<PAGE> 1
EXHIBIT 2.2
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY OTHER SECURITIES LAWS AND MAY
NOT BE SOLD OR OTHERWISE DISPOSED OF OR TRANSFERRED BY PAYEE
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
SUCH LAWS OR IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENT OF SUCH ACTS.
THE ABILITY OF PAYEE TO TRANSFER THIS NOTE IS EXPRESSLY
LIMITED BY THE PROVISIONS OF SECTION 4 HEREOF.
PROMISSORY NOTE
$15,000,000 September 8, 2000
FOR VALUE RECEIVED, the undersigned, MetaCreations Corporation, a
Delaware corporation ("Obligor"), hereby promises to pay to Computer
Associates International, Inc., a Delaware corporation ("Payee"), the
principal amount of FIFTEEN MILLION DOLLARS ($15,000,000) (the "Original
Principal Amount") or such lesser amount as determined in accordance with
Section 1.1 below, on June 8, 2001 (the "Maturity Date") in lawful money of
the United States of America by certified check or wire transfer to an account
designated by Payee.
This Promissory Note (this "Note") is Note No. 1 referred to in that
certain Stock Purchase Agreement, dated as of August 23, 2000 (the
"Agreement") by and between the Payee and the Obligor with respect to all the
outstanding capital stock of Viewpoint Digital, Inc. (the "Company").
Capitalized terms used but not defined herein shall have the meanings ascribed
to such terms in the Agreement.
Section 1. Reduction of Principal. The Original Principal Amount
shall be subject to reduction in accordance with the following calculation:
The outstanding principal amount of this Note shall equal (a) (i) the
Original Principal Amount less (ii) the amount, if any, of losses incurred by
the Company during the period commencing on the Closing Date and ending on the
Maturity Date (the "Operating Period"), less (iii) the amount, if any, by
which nine million six hundred thousand dollars ($9,600,000) exceeds the
revenues of the Company during the Operating Period MULTIPLIED BY (b) the
lesser of (x) 1 and (y) a fraction, the numerator of which is equal to the
number of Offered Employees who remain employed by the Company on the Maturity
Date and the denominator of which is equal to 95% of the number of Offered
Employees; provided, that such numerator and denominator shall both be reduced
by the number of Offered Employees who are involuntarily terminated by the
Obligor prior to the Maturity Date; and further provided that the foregoing
<PAGE> 2
reductions, if any, set forth in (ii) and (iii) above shall be subject to and
conditioned upon the Company having financial, personnel and other resources
during the Operating Period which are substantially comparable to those
resources which were available to the Company during the same period in
1999-2000.
Section 2. Obligor's Offset Rights. Obligor shall have no offset
rights with respect to the outstanding principal amount of this Note and any
amounts payable by the Seller pursuant to the Agreement or otherwise.
Section 3. Investment Representations. Payee understands that this
Note has not been registered under the Securities Act of 1933, as amended, or
any other securities laws and the rules and regulations promulgated thereunder
("Securities Act") and that the Obligor has no obligation to effect any such
registration. Payee represents and warrants to the Obligor that it is an
"accredited investor" as defined by the Securities Act and that it is
acquiring this Note for its own account, for investment and not with a view to
the distribution thereof. Payee agrees that it will not, and understands that
under the Securities Act it may not, sell or otherwise dispose of or transfer
this Note except pursuant to an effective registration statement under the
Securities Act or in a transaction exempt from the registration requirements
of the Securities Act.
Section 4. Transfer of this Note. Payee may Transfer this Note in
whole, but not in part, provided that (i) until this Note is duly presented to
the Obligor for registration of such transfer, the Obligor shall for all
purposes be entitled to treat the Payee named herein as the holder thereof and
(ii) any such transfer shall be subject to the other terms, restrictions and
conditions set forth in this Note.
Under no circumstances may Payee Transfer this Note to a person who
is a competitor of Obligor, its subsidiaries or its affiliates. For purposes
hereof, a competitor shall be deemed to be any Person who, directly or
indirectly, owns, manages, operates, represents, promotes, consults for or is
employed by, controls or participates in the ownership, operation, acquisition
or management of any other business which is substantially similar to the
business then being conducted by the Obligor or any of its subsidiaries
anywhere in the world. Further, anything to the contrary notwithstanding,
Payee may not Transfer this Note if such Transfer would violate any Securities
Act.
Section 5. Audit. Within six months after the Operating Period, Payee
shall have the right to cause an independent auditing firm to commence an
audit of the books and records of the Obligor at Payee's expense, provided
that should the audit result in an adjustment of more than 10% of the revenue
or loss incurred by the Company during the Operating Period, the cost of the
audit shall be paid by the Obligor.
Section 6. Amendment. No amendment of this Note shall be effective
unless in writing and signed by the Obligor and the Payee.
Section 7. Waiver. No waiver of any obligation or right under this
Note shall be effective unless set forth in a written instrument signed by the
party against whom such waiver is sought to be enforced. No course of dealing
between the Obligor and any holder of this Note or any delay on the part of
the holder hereof exercising any rights hereunder shall operate as a
2
<PAGE> 3
waiver of any right of the holder of this Note. Any waiver of rights hereto by
either party shall not be deemed a continuing waiver or a waiver of other
rights.
Section 8. Cancellation. After all principal and all other amounts at
any time owed on this Note have been paid in full, this Note shall be
surrendered to the Obligor for cancellation and shall not be reissued.
Section 9. Covenants Bind Successors and Assigns. All the covenants,
stipulations, promises and agreements in this Note contained by or on behalf
of the Obligor shall bind its successors and assigns, whether so expressed or
not.
Section 10. Governing Law. This Note shall be governed by and
construed in accordance with the domestic laws of the State of New York,
without giving effect to any choice of law or conflict of law provision or
rule (whether of the State of New York or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of
New York. Each party hereto consents to the jurisdiction of the federal or
state courts located in the State of New York for the adjudication of any
dispute arising hereunder.
Section 11. Headings. The headings of the sections and subsections
of this Note are inserted for convenience only and do not constitute a part of
this Note.
Section 12. Notices. Notices are to be delivered to the Payee at
the following address:
Computer Associates International, Inc.
One Computer Associates Plaza
Islandia, New York 11749
Facsimile No.: (631) 342-4866
Attn: Thomas Bennett
with a copy (which shall not constitute notice) to:
Computer Associates International, Inc.
One Computer Associates Plaza
Islandia, New York 11749
Facsimile No.: (631) 342-4866
Attn: General Counsel
Notices are to be delivered to the Obligor at the following address:
MetaCreations Corporation
498 Seventh Avenue
New York, New York 10018
Facsimile No.: (212) 201-0899
Attn: General Counsel
3
<PAGE> 4
with a copy (which shall not constitute notice) to:
Milbank, Tweed, Hadley & McCloy
1 Chase Manhattan Plaza
New York, NY 10005
Telephone: (212) 530-5000
Facsimile No.: (212) 530-5219
Attn: Mark L. Weissler, Esq.
All notices pursuant to this Note must be in writing and sent to the
party to be notified by facsimile transmission with transmission verified, by
certified or registered mail, return receipt requested, or by overnight
delivery service with delivery verified, or by personal delivery, in each case
with a copy by regular mail or facsimile transmission to the party's attorney
as specified below, any such notice being effective upon receipt. Any party
from time to time may change its address, facsimile number or other
information for the purpose of notices to that party by giving notice
specifying such change to the other party hereto.
Section 13. Severability. In case any provision of this Note shall be
invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions of this Note shall not in any way be affected or
impaired thereby.
4
<PAGE> 5
IN WITNESS WHEREOF the Obligor has caused this Note to be duly
executed and delivered as of the day and year first written above.
ATTEST: METACREATIONS CORPORATION,
"Obligor"
/s/ Brian J. O'Donoghue By: /s/ Tommy Bennett
------------------------------ ------------------------------
Name: Tommy Bennett
Title: Senior Vice President
The undersigned hereby consents to and agrees with the terms of this
Promissory Note.
COMPUTER ASSOCIATES
INTERNATIONAL, INC., "Payee"
By: /s/ Robert E. Rice
------------------------------
Name: Robert E. Rice
Title: Chief Executive Officer
5
