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EXHIBIT 2.2
AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
THIS AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER, (this "Amendment"),
dated as of February 22, 2001, by and among iVillage Inc., a Delaware
corporation (the "Parent"), Stanhope Acquisition Sub, LLC, a Delaware limited
liability company (the "Merger Sub") and wholly owned subsidiary of the Parent,
and Xxxxx.xxx Networks, Inc., a Delaware corporation (the "Company").
BACKGROUND
A. The parties hereto are parties to an Agreement and Plan of Merger, dated as
of February 5, 2001 (the "Original Agreement").
B. The parties hereto wish to amend certain provisions of the Original
Agreement, as provided herein.
NOW, THEREFORE, in consideration of the premises and mutual covenants
hereinafter set forth, the parties hereto, intending to be legally bound, hereby
agree as follows:
1. Article I, Section (n), hereby is amended to read in its entirety as follows:
`"Closing" and "Closing Date" shall mean the date on which the Merger becomes
effective.'
2. Article I, Section (uu), hereby is amended to read in its entirety as
follows: `"Exchange Ratio" shall mean 0.322, as may be decreased pursuant to
Schedule 7.2(g).'
3. The defined term "Fair Market Value" in Section (vv) of Article I of the
Original Agreement hereby is deleted in its entirety and replaced with the
following: "[intentionally omitted]".
4. Article I, Section (ww), hereby is amended to read in its entirety as
follows: `"Final Statement of Working Capital" shall mean a statement of
estimated working capital prepared by the Parent based on the Estimated
Statement of Working Capital and relating to March 31, 2001 and the day before
the Closing, which statement of Parent is delivered to the Company pursuant to
Schedule 7.2(g).'
5. Article I, Section (eeee), hereby is amended to read in its entirety as
follows: `"Per Share Merger Consideration" shall mean a fraction of a share of
Parent Common Stock calculated in accordance with the Exchange Ratio (as may be
adjusted downward pursuant to Schedule 7.2(g)), plus the Cash Amount.'
6. Article I, Section (nnnn), hereby is amended to read in its entirety as
follows: "Shortfall" shall mean the amount by which the Working Capital or cash
of the Company as at March 31, 2001, is less than the amounts set forth in
Section 7.2(g)(i); provided however, that any amount of Working Capital in
excess of the amount set forth in Section 7.2(g)(i) shall be added to the amount
of cash of the Company as at March 31, 2001 when determining any cash
Shortfall.'
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7. Section 2.4(a) of the Original Agreement hereby is amended to read in its
entirety as follows:
"(a) Each share of Company Common Stock issued and outstanding
immediately prior to the Effective Time (other than shares canceled
pursuant to Section 2.4(b) or shares as to which appraisal rights have been
demanded, exercised or perfected in accordance with Section 262 of the
DGCL, which shares shall be converted into the right to receive any amount
required by such Section 262, except as otherwise provided in Section 2.14)
shall be canceled and shall by virtue of the Merger and without any action
on the part of the holder thereof be converted automatically into the right
to receive the Per Share Merger Consideration (as may be adjusted downward
pursuant to Schedule 7.2(g)), upon the surrender of the Certificate
representing such share in the manner set forth in Section 2.5. All such
shares of Company Common Stock, when so converted (including shares as to
which appraisal rights have been demanded, exercised or perfected), shall
no longer be outstanding and shall automatically be canceled and retired
and shall cease to exist, and each holder of a Certificate representing
such shares shall cease to have any rights with respect thereto, except the
right to receive that amount of cash and number of shares of Parent Common
Stock into which such shares of Company Common Stock have been converted,
cash in lieu of fractional shares as provided in Section 2.6(c) and any
dividends or other distributions payable pursuant to Section 2.6 (and any
amount required by Section 262 of the DGCL, except as otherwise provided in
Section 2.14)."
8. Article II of the Original Agreement hereby is amended by adding to the end
thereof the following new Section 2.14:
"2.14 Appraisal Rights. Notwithstanding Section 2.4, if appraisal
rights are available to the holders of Company Common Stock pursuant to
Section 262 of the DGCL as a result of the Merger, shares of Company Common
Stock outstanding immediately prior to the Effective Time and held by a
holder who has demanded appraisal for such shares in accordance with
Section 262 of the DGCL shall not be converted into a right to receive from
Parent the Per Share Merger Consideration for each share held as provided
in Section 2.4(a), unless such holder fails to perfect or withdraws or
otherwise loses such right to appraisal. If after the Effective Time such
holder fails to perfect or withdraws or loses such right to appraisal, such
holder's shares of Company Common Stock shall be treated as if they had
been converted as of the Effective Time into a right to receive from Parent
the Per Share Merger Consideration. The Company shall give Parent prompt
notice of any demands received by the Company for appraisal of shares of
Company Common Stock, and Parent shall have the right to participate in all
negotiations and proceedings with respect to such demands. The Company
shall not, except with the prior written consent of Parent, make any
payment with respect to, or settle or offer to settle, any such demands.
Any amounts paid to a holder of Company Common Stock pursuant to a right of
appraisal under Section 262 of the DGCL will be paid by the Company out of
the
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Company's assets and in no event shall Parent or any affiliate thereof
reimburse the Company for such payments."
9. The reference to Section 5.16 in the definition of "Required Vote" hereby is
amended to be a reference to Section 5.15.
10. The reference to Section 2.6(c) in the last line of Section 2.4(a) hereby is
amended to be a reference to Section 2.5(c).
11. Section 1 of Schedule 7.2(g) of the Original Agreement hereby is amended to
read in its entirety as follows:
"1. On or prior to (a) the earlier of (i) April 2, 2001 and (ii) three days
prior to the Closing, the Company shall deliver to the Parent a statement of its
estimated or actual Working Capital as at March 31, 2001 and (b) three days
prior to the Closing, the Company shall deliver to the Parent a statement of its
estimated Working Capital as of the day before the Closing (collectively, the
"Estimated Statement of Working Capital"), both of which shall be prepared in
accordance with GAAP consistently applied and in the same manner and using the
same principles as used in preparing Schedule 2. The Company shall deliver to
the Parent all work papers and other supporting documentation used in or
relevant to the creation of the Estimated Statement of Working Capital along
with the delivery of the Estimated Statement of Working Capital."
12. Section 3 of Schedule 7.2(g) of the Original Agreement hereby is amended to
read in its entirety as follows:
"3. In the event that there is less cash or Working Capital on the Final
Statement of Working Capital than the amounts set forth in Section
7.2(g)(i):
(a) if the Shortfall in the case of cash and/or Working Capital is
$2,000,000 or less, (i) the Exchange Ratio shall be adjusted downward such
that the aggregate number of shares to be issued pursuant to the Merger in
exchange for Company Common Stock is decreased by the number of shares of
Parent Common Stock equal to the quotient of the Shortfall with respect to
cash or the Shortfall with respect to Working Capital, whichever is
greater, divided by $1.875, and (ii) Investor may, at its option, purchase
from the Parent pursuant to the Securities Purchase Agreement such number
of Shares (as defined in the Securities Purchase Agreement) as Investor
shall elect equal to or less than the quotient of (x) the Shortfall with
respect to cash or the Shortfall with respect to Working Capital, whichever
is greater, (y) divided by $1.875, which Shares shall be purchased at a
price of $1.875 per Share.
(b) if the Shortfall in the case of either cash or Working Capital is
more than $2,000,000 but less than $4,000,000 (i) the Exchange Ratio shall
be adjusted downward such that the aggregate number of shares to be issued
pursuant to the Merger in exchange for Company Common Stock is decreased by
the number of shares of Parent Common Stock equal to the quotient of the
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Shortfall with respect to cash or the Shortfall with respect to Working
Capital, whichever is greater, divided by $1.875; (ii) Investor shall
purchase from the Parent pursuant to the Securities Purchase Agreement a
number of Shares equal to the quotient of (x) the amount by which the
Shortfall with respect to cash or the Shortfall with respect to Working
Capital, whichever is greater, exceeds $2,000,000 divided by (y) $1.875,
which Shares shall be purchased at a price of $1.875 per Share; and (iii)
Investor may, at its option, purchase from the Parent pursuant to the
Securities Purchase Agreement such additional number of Shares as Investor
shall elect equal to or less than the quotient of (x) $2,000,000 divided by
(y) $1.875, which Shares shall be purchased at a price of $1.875 per Share.
(c) if the Shortfall in the case of either cash or Working Capital is
more than $4,000,000, the condition to Parent's obligation to effect the
Merger in Section 7.2(g)(i) shall not have been satisfied."
13. The Company hereby consents, for the purposes of Section 6.1(c) of the
Original Agreement, to the amendment of Parent's Certificate of Incorporation to
authorize a total of 200,000,000 shares of Parent Common Stock, and to the
submission of such amendment to Parent's stockholders for approval.
14. The parties hereto hereby agree that notwithstanding the Company's
representation in Section 4.24 of the Original Agreement, the holders of Company
Common Stock may be entitled to appraisal rights under Section 262 of the DGCL.
15. Section 7.1(e) of the Original Agreement hereby is amended to read in its
entirety as follows:
(e) The Parent shall have received the Tax Opinion and the Company
shall have received a legal opinion from Xxxxxx Godward LLP to the effect
that for United States federal income tax purposes each Company stockholder
will recognize gain or loss as a result of the Merger; provided however,
that if the counsel to either Parent or Company does not render such
opinion, this condition shall nonetheless be deemed to be satisfied with
respect to such party if counsel to the other party renders such opinion to
such party. The parties to this Agreement agree to make such reasonable
representations as requested by such counsel for the purpose of rendering
such opinions.
16. The Original Agreement, as amended hereby, remains in full force and effect.
17. Capitalized terms used but not defined herein shall have the meanings
designated in the Original Agreement.
18. This Amendment may be executed in two or more counterparts, each of which
shall be deemed an original and all of which together shall constitute one
instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first above written.
XXXXX.XXX NETWORKS, INC.
By: /s/ Xxxxxxx XxXxxxxx
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Name:
Title:
IVILLAGE INC.
By: /s/ Xxxxxxx XxXxxxxxx
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Name:
Title:
STANHOPE ACQUISITION SUB, LLC
By: /s/ Xxxxxxx XxXxxxxxx
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Name:
Title:
