TENTH AMENDMENT TO AGREEMENT AND PLAN OF MERGER
THIS TENTH AMENDMENT is made as of the 22nd day of April, 1998, by and
between ACCESS SOLUTIONS INTERNATIONAL, INC., a Delaware corporation ("Parent"),
PAPERCLIP SOFTWARE, INC., a Delaware corporation ("PSI"), and PAPERCLIP
ACQUISITION CORP., a Delaware corporation and wholly-owned subsidiary of Parent
("Acquisition"). Parent and Acquisition are hereinafter sometimes referred to
collectively as "Access."
W I T N E S S E T H:
WHEREAS, Parent, Acquisition and PSI executed and delivered a certain
Agreement and Plan of Merger dated as of November 12, 1997, as amended by a
certain First Amendment to Agreement and Plan of Merger dated January 8, 1998
("First Amendment"), Second Amendment to Agreement and Plan of Merger dated
February 20, 1998, Third Amendment to Agreement and Plan of Merger dated
February 27, 0000, Xxxxxx Xxxxxxxxx to Agreement and Plan of Merger dated March
3, 1998, Fifth Amendment to Agreement and Plan of Merger dated March 4, 1998,
Sixth Amendment to Agreement and Plan of Merger dated Xxxxx 0, 0000, Xxxxxxx
Amendment to Agreement and Plan of Merger dated Xxxxx 00, 0000, Xxxxxx Amendment
to Agreement and Plan of Merger dated March 12, 1998, and Ninth Amendment to
Agreement and Plan of Merger dated as of March 24, 1998 (as amended, the "Merger
Agreement"), pursuant to which Acquisition will merge with and into PSI on the
terms and conditions set forth therein; and
WHEREAS, the parties hereto now desire to amend the Merger Agreement to
reflect their agreement that the deadline for Closing be further extended and to
reflect certain other agreements among the parties.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Section 10.1(f) of the Merger Agreement is hereby amended to read as
follows: "At the election of Access or PSI, if the Closing shall not have taken
place on or before the earlier of: (i) May 20, 1998, or (ii) the consummation of
the financing contemplated by the Term Sheet dated as of April 14, 1998 between
the Company and Xxxxxxx X. Xxxxx ("Financing")."
2. The parties further agree that, effective upon the Parent's receipt of
$750,000 from the Financing, Section 10.1(f) of the Merger Agreement is hereby
amended to read as follows:
"At the election of Access or PSI, if the Closing shall not have taken
place on or before August 24, 1998 (or such later date as may be agreed to
in writing by Access and PSI)."
3. Notwithstanding the provisions of the Management Agreement, from the
date of the Financing through termination of this Agreement or the Closing Date,
no cash proceeds of the Financing may be spent by Parent or PaperClip without
the consent of both Xxxxxx X. Xxxxx, the President and CEO of Parent, and
Xxxxxxx Xxxxxxxx; provided, however, that no such approval is required for
payments for payroll, payroll taxes, sales taxes and Director & Officer
liability insurance for either Parent or PSI, and that best efforts will be made
on payments required under forbearance agreements and other payments deemed
essential for the continuing operation of the business or those necessary to
preserve the corporate entity. If a dispute arises between Messrs. Stone and
Xxxxxxxx regarding the amount or timing of a specific expenditure, it will be
brought to the Chairman of the Board of Parent for resolution.
4. Section 8.11 of the Merger Agreement is hereby amended by deleting the
existing Section 8.11 and by substituting the following paragraph:
"SECTION 8.11 Financing. Parent shall have received at least two
million dollars ($2,000,000), or a commitment to raise at least Two Million
Dollars ($2,000,000) reasonably satisfactory to PSI (in either case before
deduction of expenses or placement fees or commissions) from a private
placement of Parent's securities or other source of financing; provided,
however, that PSI agrees that, if at least $650,000 of the proceeds of the
financing contemplated by the Term Sheet dated as of April 14, 1998 between
Parent and Xxxxxxx X. Xxxxx is converted into equity of Parent, the amount
to be raised or the commitment shall be reduced to $1,900,000.
5. PSI agrees to use its best efforts to file as soon as practicable with
the SEC all reports and filings required to be filed with the SEC pursuant to
the Securities Act, the Exchange Act, and any other applicable federal
securities laws, unless ASI consents otherwise from time to time.
6. The first sentence of Section 10.2 of the Merger Agreement is hereby
amended by substituting the following language for the last clause of said
sentence: "and provided, further, that if this Agreement is terminated: (a) by
either party pursuant to Section 10.1 of this Agreement: (i) due to failure to
obtain the Access Director Approval or the Access Stockholder approval (if
applicable), or (ii) due to the failure of the condition contained in Section
8.11 of this Agreement, or (b) by Parent pursuant to Section 10.1(f) of this
Agreement, then in any such case, Parent will negotiate in good faith with PSI
an extension of the Maturity Date (as defined in the Convertible Promissory Note
dated January 29, 1997, as amended, issued by PSI), and of the date for
repayment of the Management Fee, the Out-of-Pocket Expenses, and the Advances
and any interest thereon(as defined in the Management Agreement between Parent
and PSI dated as of April 15, 1997, as amended) to permit PSI a sufficient
amount of time to secure capital necessary to continue its business and to pay
amounts due to Parent in a reasonable time period."
7. Section 3.2 of the Merger Agreement is hereby amended to read as
follows:
Effective upon the Closing Date, the Board of Directors of Parent
shall be reconstituted to consist of four persons designated by PSI (who
initially shall be Xxxxxxx Xxxxxxxx, Xxxxxxx Xxxxx and two persons
designated by PSI prior to the Closing Date) and four persons designated by
ASI (who initially shall be Xxxxxx Xxxxxxx, Xxxxxx Xxxxxxx, Xxxxxx Xxxxx
and Xxxxxx Xxxxx).
8. The following new Section 3.3 is hereby added to the Merger Agreement
SECTION 3.3 Parent Officers.
Effective upon the Closing Date, Parent's Board of Directors shall elect
Xxxxxxx Xxxxxxxx as Chairman of Parent, and Xxxxxx X. Xxxxx as President of
Parent.
9. Section 2.2(c) of the Merger Agreement is hereby amended to read as
follows:
"At the Effective Time, Parent will offer stock options to PSI
employees who continue to be employed by Parent or the Surviving
Corporation in the amounts set forth on Schedule 2.2(c) attached hereto."
10. The third sentence of Section 2.4(e) of the Merger Agreement is hereby
amended by deleting the existing sentence and substituting the following
sentence therefor:
"As soon as practicable after the Effective Time, the Parent shall
cause the Exchange Agent to send a notice and a transmittal form to each
holder of record of a Certificate advising such holder of the effectiveness
of the Merger and the procedure for surrendering to the Exchange Agent such
Certificate in exchange for the Merger Consideration."
11. Section 6.13 of the Merger Agreement is hereby amended by deleting said
section and by substituting the following therefor:
"SECTION 6.13 Intentionally omitted."
12. Section 11.1 of the Merger Agreement is hereby amended by deleting said
section and by substituting the following therefor:
"SECTION 11.1 Intentionally omitted."
13. In the event of a conflict between the terms of the Merger Agreement
and this Tenth Amendment, the terms of this Tenth Amendment shall control.
14. This Tenth Amendment supersedes and replaces the Second through Ninth
Amendments, and all other prior agreements among the parties with respect to its
subject matter.
15. Except as modified and amended hereby, the Merger Agreement, as
modified by the First Amendment and this Tenth Amendment shall remain in full
force and effect and is in all other respects ratified and confirmed.
16. This Amendment may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the day and year indicated above.
ACCESS SOLUTIONS INTERNATIONAL, INC.
By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx, President and CEO
PAPERCLIP SOFTWARE, INC.
By: /s/ Xxxxxxx Xxxxx
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Xxxxxxx Xxxxx, Chief Executive Officer
PAPERCLIP ACQUISITION CORP.
By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx, President
