EXHIBIT 10.55
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FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER
This First Amendment to Agreement and Plan of Merger ("First
Amendment") is dated as of the 29th day of March, 2007 by and among Bridgeline
Software, Inc., a Delaware corporation ("Bridgeline"), Objectware, Inc., a
Georgia corporation (the "Seller"), and Erez M. Katz (the "Shareholder").
W I T N E S S E T H:
WHEREAS, Bridgeline, Seller and Shareholder entered into that certain
Agreement and Plan of Merger dated as of December 7, 2006 (the "Merger
Agreement") pursuant to which the parties agreed that Seller would merge with
and into Bridgeline as provided therein;
WHEREAS, terms used herein and not otherwise defined shall have the
meaning ascribed to such terms in the Merger Agreement;
WHEREAS, the parties hereto desire to amend the Merger Agreement on the
terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt,
adequacy and sufficiency at which are hereby acknowledged, the parties hereby
agree as follows:
1. The Merger Agreement is hereby amended in the following respects:
(a) The "Target Amount" (as defined in the first line of
Section 1.2(b)), is hereby changed from "$900,000" to "$750,000."
(b) A new Section 8.6, entitled "Tax Agreements," is hereby
added as follows:
"8.6 TAX AGREEMENTS.
(a) Seller and Seller's accountants, Carr, Riggs & Ingram,
LLC, shall prepare or cause to be prepared all Tax Returns of the Seller for all
Tax periods ending on or prior to the Closing Date that are required to be filed
after the Closing Date including any Tax Return for the short period ending on
the Closing Date (the "SHORT PERIOD RETURNS"). All such Tax Returns shall be
prepared on a cash basis in a manner consistent with the prior practice of
Seller, and Shareholder shall bear all costs in connection with the preparation
of such Tax Returns. Shareholder shall provide Bridgeline with a copy of such
Tax Returns at least thirty (30) days prior to the due date for any such return
and shall make such revisions as are reasonably requested by Bridgeline.
Bridgeline shall execute and file such Tax Returns on or prior to the due date
thereof (taking into account any extensions received from the relevant tax
authorities), and Shareholder shall pay all Taxes when due with respect to said
Tax Returns, except for any Taxes arising from the failure of the Merger to
qualify as a reorganization described in Section 368(a) of the Code.
(b) In order to apportion appropriately any Taxes relating to
a period that includes the Closing Date, the parties will, to the extent
permitted by applicable law, elect with the relevant tax authority to treat the
Closing Date as the last day of a taxable period of the Seller (a "SHORT
PERIOD"), and such period shall be treated as a Short Period and a period ending
prior to or on the Closing Date for purposes of this Agreement. In any case
where applicable law does not permit the Seller to treat the Closing Date as the
last day of a Short Period, then for purposes of this Agreement, the portion of
each Tax that is attributable to the period which would have qualified as a
Short Period if such election had been permitted by applicable law (a "STRADDLE
PERIOD") shall be (i) in the case of a Tax that is not based on net income, the
total amount of such Tax for the period in question multiplied by a fraction,
the numerator of which is the number of days in the Straddle Period, and the
denominator of which is the total number of days in such period, and (ii) in the
case of a Tax that is based on net income, the Tax that would be due with
respect to the Straddle Period if such Straddle Period were a Short Period
determined based upon an interim closing of the books.
(c) Any refunds that are received by Bridgeline or the Seller,
and any amounts credited against Tax to which Bridgeline or the Seller become
entitled, that relate to Seller's periods or portions thereof ending on or
before the Closing Date shall be for the account of Shareholder, and Bridgeline
shall, to the extent there is no amount due from the Shareholder under paragraph
(a) hereof, pay over to Shareholder any such refund or the amount of such credit
within 15 days after receipt or entitlement thereto.
(d) Neither Shareholder nor Bridgeline shall file or cause to
be filed any amended Tax Return or claims for refund with respect to Seller for
any pre-Closing period without prior notification to the other party.
(e) Bridgeline and Shareholder shall cooperate fully, as and
to the extent reasonably requested by the other party, in connection with the
filing of Tax Returns pursuant to this Section 8.6 and any audit, litigation, or
other proceeding with respect to such Tax Returns. Such cooperation shall
include Bridgeline's retention and (upon Shareholder's request) the provision of
records and information which are reasonably relevant to any such audit,
litigation, or other proceeding."
(c) Section 10.3(a) is deleted in its entirety and replaced
with the following:
"(a) All fees and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by
the party incurring such fees and expenses, whether or not the Merger is
consummated; PROVIDED, HOWEVER, that if the Merger is consummated, Bridgeline
shall pay up to an aggregate of $200,000 for the reasonable legal expenses of
counsel to the Seller and accounting expenses incurred in connection with the
Merger including the accounting fees for the audit of Seller's fiscal years
ending September 30, 2004, September 30, 2005 and September 30, 2006, it being
acknowledged and agreed to by the parties that the Shareholder shall be
personally responsible for any such expenses of Seller exceeding this limit."
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(d) Section 10.3(b)(ix) is deleted in its entirety and
replaced with the following:
"(ix) by Seller, at any time following June 15,
2007."
(e) The introductory sentence of Section 10.3(c) is deleted in
its entirety and replaced with the following:
"Bridgeline shall pay Seller a termination fee of
$200,000 (plus reasonable expenses of the Seller actually incurred relating to
the transactions contemplated by this Agreement prior to termination) in the
event of termination of this Agreement; provided that no such termination fee
shall be paid by Bridgeline to Seller in the event of the termination of this
Agreement:"
(f) Section 10.3(c)(vii) is deleted in its entirety and
replaced with the following:
"(vii) by Bridgeline, at any time following June 15,
2007."
2. Except as amended hereby, the Merger Agreement remains in full force
and effect.
3. This First Amendment may be executed in multiple counterparts, each
of which shall be deemed an original and all of which taken together shall
constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment as of the day and year first above written.
BRIDGELINE:
Bridgeline Software, Inc.
By: /s/ Thomas L. Massie
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Name: Thomas L. Massie
Title: President and Chief Executive Officer
SELLER:
Objectware, Inc.
By: /s/ Erez M. Katz
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Name: Erez M. Katz
Title: President and Chief Executive Officer
SHAREHOLDER:
By: /s/ Erez M. Katz
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Erez M. Katz
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