Exhibit 2.1
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (the "Merger Agreement") is entered into
as of the 21st day of July, 1999 by and between XXxxxx.xxx Inc., a Florida
corporation ("EMusic"), and XXxxxx.xxx Inc., a Delaware corporation ("Sub").
WITNESSETH:
WHEREAS, Sub is a corporation duly organized and existing under the laws of
the State of Delaware, having its address at 0000 Xxxxxxxx, 0xx Xxxxx, Xxxxxxx
Xxxx, Xxxxxxxxxx, 00000;
WHEREAS, EMusic is a corporation duly organized and existing under the laws
of the State of Florida, having its address at 0000 Xxxxxxxx, 0xx Xxxxx, Xxxxxxx
Xxxx, Xxxxxxxxxx, 00000;
WHEREAS, on the date of this Merger Agreement, Sub has authority to issue
200,000,000 shares of Common Stock, par value $.001 per share (the "Sub Common
Stock"), of which 1,000 shares are issued and outstanding and owned by EMusic
and 20,000,000 shares of Preferred Stock, par value $.001 per share (the "Sub
Preferred Stock"), of which 120,000 shares have been designated as Series B
Preferred Stock (the "Sub Series B Preferred Stock"), none of such shares are
issued and outstanding;
WHEREAS, as of June 21, 1999, the record date for the special meeting at
which the shareholders of EMusic approved a form of this Merger Agreement,
EMusic had authority to issue (i) 200,000,000 shares of Common Stock, par value,
$.01 per share (the "EMusic Common Stock"), of which 15,690,879 shares were
issued and outstanding as of such date and (ii) 500,000 shares of Preferred
Stock, par value $.01 per share, of which 120,000 shares have been designated as
Series B Preferred Stock (the "EMusic Series B Preferred Stock") and 117,570 of
such shares were issued and outstanding as of such date;
WHEREAS, the respective Boards of Directors for Sub and EMusic have
determined that, for the purpose of effecting the reincorporation of EMusic in
the State of Delaware, it is advisable and to the advantage of said two
corporations and their shareholders that EMusic merge with and into Sub upon the
terms and conditions herein provided; and
WHEREAS, the respective Boards of Directors of Sub and EMusic, the
shareholders of EMusic, and the sole stockholder of Sub have adopted and
approved this Merger Agreement;
NOW, THEREFORE, in consideration of the mutual agreements and covenants set
forth herein, EMusic and Sub hereby agree to merge as follows:
1. Merger. EMusic shall be merged with and into Sub, and Sub shall
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survive the merger (the "Merger"), effective upon the date when this Merger
Agreement is made effective in accordance with applicable law (the "Effective
Date").
2. Governing Documents. The Amended and Restated Certificate of
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Incorporation of Sub shall be the Certificate of Incorporation of the surviving
corporation; and the Amended and Restated Bylaws of Sub shall be the Bylaws of
the surviving corporation.
3. Directors and Officers. The directors and officers of EMusic shall
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become the directors and officers of Sub upon the Effective Date.
4. Succession. On the Effective Date, Sub shall succeed to EMusic in the
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manner of and as more fully set forth in Section 259 of the General Corporation
Law of the State of Delaware.
5. Further Assurances. From time to time, as and when required by Sub
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or by its successors and assigns, there shall be executed and delivered, on
behalf of EMusic, such deeds and other instruments, and there shall be taken or
caused to be taken by it such further and other action as shall be appropriate
or necessary in order to vest, perfect or confirm, of record or otherwise, in
Sub, the title to and possession of all the property, interests, assets, rights,
privileges, immunities, powers, franchises and authority of EMusic, and
otherwise to carry out the purposes of this Merger Agreement and the officers
and directors of Sub are fully authorized in the name and on behalf of EMusic or
otherwise to take any and all such action and to execute and deliver any and all
such deeds and other instruments.
6. Stock of EMusic. Upon the Effective Date, by virtue of the Merger and
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without any action on the part of the holder thereof, (i) each share of EMusic
Common Stock outstanding immediately prior thereto shall be changed and
converted into one fully paid and nonassessable share of Sub Common Stock and
(ii) each share of EMusic Series B Preferred Stock outstanding immediately prior
thereto shall be changed and converted into one fully paid and nonassessable
share of Sub Series B Preferred Stock.
7. Stock Certificates. On and after the Effective Date, all of the
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outstanding certificates which prior to that time represented shares of EMusic
stock shall be deemed for all purposes to evidence ownership of and to represent
the shares of Sub stock into which the shares of EMusic stock represented by
such certificates have been converted as herein provided. The registered owner
on the books and records of Sub or its transfer agent of any such outstanding
stock certificate shall, until such certificate shall have been surrendered for
transfer or otherwise accounted for to Sub or its transfer agent, have and be
entitled to exercise any voting and other rights with respect to and to receive
any dividend and other distributions upon the shares of Sub stock evidenced by
such outstanding certificate as above provided.
8. Options. Upon the Effective Date, each outstanding option, warrant or
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other right to purchase shares of EMusic stock, including those options granted
under the 1998 Stock Option Plan (the "1998 Plan") and the Nonstatutory Stock
Option Plan (the "Nonstatutory Plan") of EMusic, shall be converted into and
become an option, warrant or right to purchase the same number of shares of Sub
stock at a price per share equal to the exercise price of the option, warrant or
right to purchase EMusic stock and upon the same terms and subject to the same
conditions as set forth in the 1998 Plan and the Nonstatutory Plan,
respectively, and other agreements entered into by EMusic pertaining to such
options, warrants or rights. A number of shares of Sub stock shall be reserved
for purposes of such options, warrants and rights equal to the number of shares
of EMusic stock so reserved as of the Effective Date. As of the Effective Date,
Sub shall assume all obligations of EMusic under agreements pertaining to such
options, warrants and rights, including the 1998 Plan and Nonstatutory Plan, and
the outstanding options, warrants or other rights, or portions thereof, granted
pursuant thereto.
9. Other Employee Benefit Plans. As of the Effective Date, Sub hereby
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assumes all obligations of EMusic under any and all employee benefit plans in
effect as of said date or with respect to which employee rights or accrued
benefits are outstanding as of said date.
10. Outstanding Common Stock of Sub. Forthwith upon the Effective Date,
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all shares of Sub Common Stock presently issued and outstanding in the name of
EMusic shall be canceled and retired and resume the status of authorized and
unissued shares of Sub Common Stock, and no shares of Sub Common Stock or other
securities of Sub shall be issued in respect thereof.
11. Covenants of Sub. Sub covenants and agrees that it will, on or before
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the Effective Date:
a. Qualify to do business as a foreign corporation in the State of
California, and in all other states in which EMusic is so qualified and in which
the failure so to qualify would have a material adverse impact on the business
or financial condition of Sub. In connection therewith, Sub shall irrevocably
appoint an agent for service of process as required under the provisions of
Section 2105 of the California Corporations Code and under applicable provisions
of state law in other states in which qualification is required hereunder.
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b. File any and all documents with the Florida tax authorities
necessary to the assumption by Sub of all of the tax liabilities of EMusic.
12. Book Entries. As of the Effective Date, entries shall be made upon
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the books of Sub in accordance with the following:
a. The assets and liabilities of EMusic shall be recorded at the
amounts at which they were carried on the books of EMusic immediately prior to
the Effective Date, with appropriate adjustments to reflect the retirement of
the shares of Sub Common Stock presently issued and outstanding.
b. There shall be credited to the capital stock of Sub the aggregate
amount of the par value of all shares of Sub stock resulting from the conversion
of the outstanding Sub Common Stock pursuant to the Merger.
c. There shall be credited to the capital surplus account of Sub the
aggregate of the amounts shown in the capital stock and capital surplus accounts
of EMusic immediately prior to the Effective Date, less the amount credited to
the common stock account of Sub pursuant to Paragraph (b) above.
d. There shall be credited to the retained earnings account of Sub
an amount equal to that carried in the retained earning account of EMusic
immediately prior to the Effective Date.
13. Conditions. It shall be a condition precedent to the consummation
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of the Merger and the other transactions contemplated by this Merger Agreement
that the shares of Sub Common Stock to be issued by Sub shall, upon official
notice of issuance, be listed on the Nasdaq National Market prior to or on the
Effective Date.
14. Amendment. EMusic, at any time, to the fullest extent permitted by
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Section 251(d) of the Delaware General Corporation Law, may amend this Merger
Agreement in any manner as may be determined in the judgment of the respective
Boards of Directors of Sub and EMusic to be necessary, desirable or expedient in
order to clarify the intention of the parties hereto or to effect or facilitate
the purposes and intent of this Merger Agreement.
15. Abandonment. At any time before the Effective Date, this Merger
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Agreement may be terminated and the Merger may be abandoned by the Board of
Directors of either EMusic or Sub or both, notwithstanding approval of this
Merger Agreement by the sole stockholder of Sub and the shareholders of EMusic.
16. Counterparts. In order to facilitate the filing and recording of this
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Merger Agreement, the same may be executed in any number of counterparts, each
of which shall be deemed to be an original.
THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK
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IN WITNESS WHEREOF, this Merger Agreement, having first been duly approved
by resolution of the Board of Directors of EMusic and Sub, and subsequently duly
approved by resolution of the shareholders of EMusic and the sole stockholder of
Sub, is hereby adopted, approved, certified executed and acknowledged on behalf
of each of said two corporations by their respective officers thereunto duly
authorized.
Xxxxxx.xxx Inc., a Florida corporation
By: /s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx, Executive Vice President
ATTEST:
/s/ Xxxxx Xxxxx
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Xxxxx Xxxxx, Secretary
Xxxxxx.xxx Inc. a Delaware corporation
By: /s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx, Executive Vice President
ATTEST:
/s/ Xxxxx Xxxxx
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Xxxxx Xxxxx, Secretary
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