EXHIBIT 2.01
AMENDMENT
AGREEMENT OF ACQUISITION
AND
PLAN OF REORGANIZATION
between
SONA DEVELOPMENT CORP.
(“Sona”) and
SIBLING ENTERTAINMENT GROUP, INC.
(“Sibling”)
Dated June 28, 2006 (the
“Agreement”)
The parties to this Amendment hereby
agree to the following changes in the Agreement.
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A.
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Section 1.3 Closing Date of the
Agreement is deleted in its entirety and the following substituted
in lieu thereof:
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“The closing of the
Acquisition (the “Closing Date”) shall take place
within three (3) business days after compliance with Section 1.2
herein is completed by both parties and any other conditions of
this Agreement shall be satisfied. The parties have contemplated
February 9, 2007 as a Closing Date. However, in good faith, both
parties shall agree to close prior to such time if all conditions
for closing are satisfied. Notwithstanding the above, if the
closing does not take place by February 9, 2007, either party may
terminate this Agreement.”
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B.
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To conclude Sibling’s efforts
to acquire Dick Foster Productions, Inc., and to meet current
working capital needs, Sona shall permit Sibling Theatrical, Inc.
to raise up to three million ($3,000,000) dollars from a banking or
other financial institution (the “Lending Bank”)
through a debt instrument guaranteed by third parties (the
“Guarantor”), whereby Sibling shall be permitted to
compensate the Guarantor and the Lending Bank with cash, stock
and/or warrants (the “Debt Offering”), which
compensation in the form of stock and/or warrants shall be
exchanged in equal measure for stock and/or warrants of Sona on the
Closing Date as considered in Article 1.1. of the Agreement. In
exchange for a no fee guarantee the Guarantor shall receive
3,600,000 million purchase warrants exercisable for a period of
five (5) year from the date of issuance with an exercise price in
the following denominations:
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a.
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1,200,000 warrants at
$0.55/share.
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b.
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1,200,000 warrants at
$0.75/share.
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c.
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1,200,000 warrants at
$1.00/share.
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C.
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Furthermore, Sona shall permit
Sibling in advance of closing the Debt Offering to accept from the
Guarantor an advance of up to Seven-Hundred Fifty Thousand
($750,000) Dollars of which Five Hundred Thousand ($500,000)
Dollars will be repaid upon the closing of the Debt Offering; and
Two Hundred Fifty Thousand ($250,000) will be repaid in the form of
a convertible debenture entitling the Guarantor as the debenture
holder to convert any outstanding principal of the debenture into
shares of common stock at the rate of $0.35/share for a total of
714,288 shares and upon conversion to receive an additional
issuance of 357,144 stock purchase warrants exercisable at
$0.75/share and 357,144 stock purchase warrants exercisable at
$1.00/share, both with a term of five (5) years from the date of
issuance.
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Page 5 of 9
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D.
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Section 4.2 (b) of the Agreement is
deleted in its entirety and the following substituted in lieu
thereof:
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“Sibling shall not (i)
directly or indirectly redeem, purchase or otherwise acquire or
agree to redeem, purchase or otherwise acquire any shares of its
capital stock except as set forth on Exhibit B attached hereto as
Revised Exhibit B to the Agreement; (ii) amend its articles of
incorporation or bylaws or those of the Subsidiaries; or (iii)
split, combine or reclassify its capital stock or declare, set
aside or pay any dividend payable in cash, stock or property or
make any distribution with respect to such stock;
and”
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E.
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Section 4.2 (c) of the Agreement is
deleted in its entirety and the following substituted in lieu
thereof:
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“Sibling and its Subsidiaries
shall not (i) issue or agree to issue any additional shares of, or
options, warrants or rights of any kind to acquire shares of, its
capital stock other than its present offering of Series F shares
(5,714,300), any shares required to be issued by Sibling pursuant
to any registration agreement, the RHS Convertible debenture, the
Debt Offering and related stock and/or warrants issued to licensed
investment bankers and brokers engaged to sell and place any
existing or proposed offerings and/or debt and related
participation agreements, or execute any other consulting
agreements other than those detailed in exhibits attached the
Agreement and any supplemental exhibits. Attached hereto and made
apart hereof as Exhibit G(b) is the subscription agreement for the
Series F offering; (ii) acquire or dispose of any assets other than
in the ordinary course of business; (iii) incur additional
indebtedness or any other liabilities or enter into any other
transaction except in the ordinary course of business except for
the Debt Offering; (iv) enter into any contract, agreement,
commitment or arrangement with respect to any of the foregoing
other than those detailed in the exhibits attached to the Agreement
and any supplemental exhibits, or (v) except as contemplated by
this Amendment, enter into any contract, agreement, commitment or
arrangement to dissolve, merge; consolidate or enter into any other
material business contract or enter into any negotiations in
connection therewith other than those detailed in exhibits attached
to the Agreement and any supplemental exhibits.”
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F.
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Section 4.2 (e) of the Agreement is
deleted in its entirety and the following substituted in lieu
thereof:
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“Sibling and its Subsidiaries
will not enter into any new employment agr
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