EXHIBIT 2.2
FIRST AMENDMENT
TO
AGREEMENT AND PLAN OF REORGANIZATION
This FIRST AMENDMENT to AGREEMENT AND PLAN OF REORGANIZATION (this
"Amendment") is made and entered into as of January 3, 2003 by and among Brocade
Communications Systems, Inc., a Delaware corporation ("Parent"), Maverick
Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of
Parent ("Sub"), Rhapsody Networks, Inc., a Delaware corporation (the "Company"),
Xxxxxxx X. Xxxxx (the "Stockholder Representative"), and U.S. Bank, N.A. (the
"Escrow Agent").
WHEREAS, the parties have previously entered into that certain
Agreement and Plan of Reorganization, dated as of November 5, 2002 (the
"Agreement"); and
WHEREAS, the parties wish to amend the Agreement pursuant to Section
8.3 thereof as set forth below;
NOW, THEREFORE, the parties hereto agree as follows:
1. All capitalized terms used and not defined herein shall have the
meanings ascribed to such terms in the Agreement. All references to the
Agreement in any other agreement among the parties relating to the
transactions contemplated by the Agreement shall be deemed to refer to
the Agreement as amended hereby.
2. Section 1.6(a)(xv) of the Agreement is hereby amended and restated to
state in its entirety as follows:
(xv) "EXCHANGE RATIO" shall mean the Residual Proceeds
divided by the Total Outstanding Shares, rounded to the nearest
ten billionth (.0000000001) (with amounts .00000000005 and above
rounded up).
3. Section 1.6(b)(v) of the Agreement is hereby amended and restated to
state in its entirety as follows:
(v) The shares of Parent Common Stock to be received in
connection with the Merger or to be received upon exercise of
vested or unvested Company Options assumed in connection with
the Merger shall be restricted such that each Stockholder may
not: (i) offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant for the
sale of, or otherwise dispose of or transfer any shares of
Parent Common Stock to be received in connection with the
Merger or to be received upon exercise of
vested or unvested Company Options assumed in connection with
the Merger or (ii) enter into any swap or any other agreement
or any transaction that transfers, in whole or in part,
directly or indirectly, the economic consequence of ownership
of the Parent Common Stock to be received in connection with
the Merger or to be received upon exercise of vested or
unvested Company Options assumed in connection with the
Merger, whether any such swap or transaction is to be settled
by delivery of Parent Common Stock or other securities, in
cash or otherwise (collectively, the "LOCK-UP PROVISION"). The
Lock-up Provision shall lapse as follows: (A) a number of
shares equal to forty five percent (45%) of the shares of
Parent Common Stock to be received by each Stockholder
(including for the purpose of calculating the percentages in
this sentence all shares subject to assumed Company Options,
whether vested or unvested, and the aggregate number of
additional shares that may be issued upon payment in full of
the Earn-Out Payment) shall be freely tradeable and
transferable upon the Closing, to the extent vested or, if
forty five percent (45%) of such shares are not vested, up to
forty five percent (45%) of such shares upon vesting), (B) a
number of shares equal to thirty percent (30%) of the shares
of Parent Common Stock to be received by each Stockholder
shall be freely tradeable and transferable on the date that is
six (6) months after the Closing, to the extent vested or, if
thirty percent (30%) of such shares are not vested, up to
thirty percent (30%) of such shares upon vesting), and (C) the
remaining twenty-five percent (25%) of the shares of Parent
Common Stock to be received by such Stockholder (including
shares released from the escrow and shares received upon
payment of the Earn-Out Payment, if any) shall be freely
tradeable and transferable on the first anniversary of the
Closing; provided however, that if such Stockholder is a
non-officer employee of the Company at the Effective Time,
then the remaining twenty-five percent (25%) of the shares of
Parent Common Stock to be received by such Stockholder
(including shares released from the escrow and shares received
upon payment of the Earn-Out Payment, if any) shall be
released from the Lock-up Provision (but not the escrow or any
other restriction) on the date that is six (6) months after
the Closing. Certificates that represent shares of Parent
Common Stock to be received in connection with the Merger or
issued upon exercise of vested or unvested Company Options
assumed in connection with the Merger shall be legended to
reflect the Lock-up Provision (the "LOCK-UP LEGEND").
4. This Amendment shall be governed by and construed in accordance with
the laws of the State of California, regardless of the laws that might
otherwise govern under applicable principles of conflicts of laws
thereof.
5. This Amendment may be executed in one or more counterparts, all of
which shall be considered one and the same agreement and shall become
effective when one or more counterparts have been signed by each of the
parties and delivered to the other party, it being understood that all
parties need not sign the same counterpart.
6. Except as amended by this Amendment, the terms and conditions of the
Agreement shall remain unchanged and the Agreement shall remain in full
force and effect.
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IN WITNESS WHEREOF, Parent, Sub, the Company, the Escrow Agent and the
Stockholder Representative have caused this First Amendment to Agreement and
Plan of Reorganization to be signed by their duly authorized respective
officers, all as of the date first written above.
BROCADE COMMUNICATIONS RHAPSODY NETWORKS, INC.
SYSTEMS, INC.
By: /s/ Xxxxxxx Xxxxxx By: /s/ Xxxxxx Xxxxxxxx
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Name: Xxxxxxx Xxxxxx Name: Xxxxxx Xxxxxxxx
Title: VP, Finance and Chief Financial Officer Title: Chief Financial Officer
STOCKHOLDER REPRESENTATIVE: MAVERICK ACQUISITION CORP.
/s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxxx Xxxxxx
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Xxxxxxx X. Xxxxx
Name: Xxxxxxx Xxxxxx
Title: Treasurer
ESCROW AGENT:
U.S. BANK, N.A.
By: /s/ Xxx Xxxxxx
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Name: Xxx Xxxxxx
Title: Vice President
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