AGREEMENT
AND PLAN OF MERGER
This
Amendment, dated as of February 12, 2008, is among Mandalay Media, Inc., a
Delaware corporation (“Parent”), Twistbox Acquisition, Inc., a Delaware
corporation and a wholly-owned subsidiary of Parent (“Merger Sub”), Twistbox
Entertainment, Inc., a Delaware corporation (the “Company”), and Adi McAbian and
Spark Capital, L.P. (“Spark Capital”) as representatives of the stockholders of
the Company (collectively, the “Stockholder Representatives” and individually, a
“Stockholder Representative”).
1.
Reference
to Merger Agreement; Definitions.
Reference is made to the Agreement and Plan of Merger dated as of December
31,
2007, by and among Parent, Merger Sub, the Company and the Stockholder
Representatives (the “Merger Agreement”). Terms defined in the Merger Agreement
and not otherwise defined herein are used herein with the meanings so defined.
2.
Amendment
to Section 1.4(a) of Merger Agreement. Section 1.4(a) of the Merger Agreement
is
hereby deleted in its entirety and replaced with the following:
“(a) At
the
Effective Time, the Certificate of Incorporation of the Company shall be
the
Certificate of Incorporation of the Surviving Corporation.”
3.
Amendment
to Schedule 1.5(a) of Merger Agreement.
Schedule 1.5(a) of the Merger Agreement is hereby deleted in its entirety
and
replaced with new Schedule 1.5(a) attached hereto.
4.
Amendment
to Section 1.5(e) of Merger Agreement. Section 1.5(e) of the Merger Agreement
is
hereby deleted in its entirety and replaced with the following:
“(e) Stock
Options.
At
the
Effective Time, each
outstanding option (a “Company Option”) to purchase shares of Company Common
Stock issued pursuant to the Company’s 2006 Stock Incentive Plan (the “Stock
Plan”) shall be assumed by Parent, on the same terms and conditions as were
applicable under the Stock Plan immediately prior to the Effective Time,
except
that:
(i) the
number of shares of Parent Common Stock subject to each Company Option shall
be
determined by multiplying the number of shares of Company Common Stock that
were
subject to such Company Option immediately prior to the Effective Time by
the
Option Conversion Ratio (as defined below), and rounding the resulting number
down to the nearest whole number of shares of Parent Common Stock; and (ii)
the
per share exercise price for the shares of Parent Common Stock issuable upon
exercise of each Company Option shall be determined by dividing the per share
exercise price of Company Common Stock subject to such Company Option, as
in
effect immediately prior to the Effective Time, by the Option Conversion
Ratio;
provided, however, that the exercise price and the number of shares of Parent
Common Stock subject to each Company Option shall be determined in a manner
consistent with the requirements of Section 409A of the Code to the extent
applicable; and provided, further, that in the case of any Company Option
to
which Section 422 of the Code applies, the option price, the number of shares
subject to such Company Option and the terms and conditions of exercise of
such
Company Option shall be determined in accordance with the foregoing, subject
to
such adjustments as are necessary in order to satisfy the requirements of
Section 424(a) of the Code. Any restriction on the exercise of any Company
Option assumed by Parent shall continue in full force and effect and the
term,
exercisability and other provisions of such Company Option shall otherwise
remain unchanged as a result of the assumption of such Company Option; provided,
however, the Company Options that are accelerated at the Effective Time as
a
result of the Merger, as set forth in Schedule
2.3(a),
shall
be immediately exercisable after the Effective Time. The “Option
Conversion Ratio”
shall
be equal to 0.72967. Notwithstanding anything to the contrary set forth herein
or on Schedule 1.5(a), the Merger Consideration shall consist of an aggregate
of
12,325,000 shares of Parent Common Stock which will include the conversion
of
all shares of Company Capital Stock and the reservation of all shares of
Parent
Common Stock required for assumption of the Company Options that have vested
as
of the Effective Time.
Parent
shall reserve for issuance a sufficient number of shares of Parent Common
Stock
for delivery upon exercise of the Company Options assumed by Parent, which,
as
of the date hereof, are as set forth on Schedule 1.5(a) (such Schedule to
be
amended at or prior to Closing to reflect the issuance of any shares of Company
Common Stock, whether by exercise of Company Options or otherwise, after
the
date hereof and prior to Closing).”
5.
Miscellaneous
.
Except
as otherwise set forth herein, the Merger Agreement shall remain in full
force
and effect without change or modification. This Amendment may be executed
in any
number of counterparts, which together shall constitute one instrument, and
shall bind and inure to the benefit of the parties and their respective
successors and assigns.
IN
WITNESS WHEREOF, the parties hereto have executed this Amendment as of the
day
and year first above written.
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MANDALAY MEDIA, INC. |
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By: /s/ Jay Wolf |
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Name: Jay Wolf |
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Title: Chief Financial
Officer |
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TWISTBOX ACQUISITION, INC. |
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By: /s/ Jay
Wolf |
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Name: Jay Wolf |
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Title: Chief Financial
Officer |
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TWISTBOX ENTERTAINMENT, INC. |
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By: /s/ Ian Aaron |
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Name: Ian Aaron |
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Title: President and Chief Executive
Officer |
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STOCKHOLDER REPRESENTATIVE |
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By: /s/ Adi McAbian |
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Name: Adi McAbian |
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Spark Capital, L.P. |
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By: Spark Management Partners, LLC,
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its General Partner |
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By: /s/ Dennis
Miller |
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Name: Dennis Miller |
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Managing
Member |