Exhibit 2.2
AMENDMENT NO. 1
TO
AGREEMENT OF PURCHASE FOR THE
PRECISION GUNNERY TRAINING SYSTEMS ASSETS
This Amendment No. 1 to Agreement of Purchase for the Precision Gunnery
Training Systems Assets (this "AMENDMENT NO. 1") is made as of July 20, 2000 by
and between PERCEPTRONICS, INC., a Delaware corporation ("Seller"), and EIDETICS
CORPORATION, a California corporation ("BUYER"), with reference to that certain
Agreement of Purchase for the Precision Gunnery Training Systems Assets (the
"AGREEMENT OF PURCHASE"), entered into as of May 31, 2000, by and between Seller
and Buyer. All capitalized terms not otherwise defined in this Amendment No. 1
shall have the same respective meanings as set forth in the Agreement of
Purchase.
WHEREAS, the parties have previously entered into the Agreement of
Purchase, and
WHEREAS, the parties now desire to clarify certain provisions of the
Agreement of Purchase, including provisions regarding the payment of royalties
by Buyer to Seller.
NOW, THEREFORE, in consideration of the foregoing and the provisions set
forth below, the parties hereto hereby agree as follows:
1. AMENDMENT OF SECTION 2.6(B). Subsection (b) of Section 2.6 of the
Agreement of Purchase is hereby amended in its entirety to read as follows:
(b) Other than with respect to revenues under the Egyptian
Contract and any add-on contract, extension agreement, modification
agreement and upgrade contract related thereto, Buyer shall, for a
period of four years after the date of the acquisition by Buyer of the
Purchased Assets, pay to Seller a three percent (3%) royalty fee on
cash-basis gross revenues (as payments are received actually or
constructively by Buyer or its Affiliate) allocable to PGTS sales
and/or sales of simulators using as a material and integral component
of such simulator the acquired Perceptronics simulation technology,
including but not limited to PGTS, TT150 and AGPT. The royalty rate
shall be paid only on the portion of a contract specifically relating
to the PGTS Assets and not to other contract deliverables. In addition
to the foregoing, Buyer shall pay to Seller a three percent (3%)
royalty fee on cash-basis gross revenues (as payments are received
actually or constructively by Buyer or its Affiliate) received with
respect to the Egyptian Contract and any add-on contract, extension
agreement, modification agreement and upgrade contract related
thereto, such payments to continue until the later of either (i) four
years after the date of the award of the Egyptian Contract, or (ii)
the date that the last payment under any such add-on contract,
extension agreement, modification agreement or upgrade contract is
received by Buyer or its Affiliate. Notwithstanding the foregoing, any
amounts paid by Buyer with respect to the Lease under SCHEDULE 2.3,
Item 1, shall offset Buyer's
obligation to pay the first amounts of royalty fees otherwise payable
under any provision of this section.
2. WAIVER OF CLOSING DELIVERIES. Buyer hereby waives Seller's obligation
under Section 2.7(i) of the Agreement of Purchase to deliver at Closing the
consents set forth on SCHEDULE 3.5, Items 1, 3 and 4. Buyer and Seller hereby
certify that each of their respective representations and warranties as set
forth in the Agreement are true as of the Closing Date and hereby waive the
requirement of separate certificates as required under the last sentence of
Section 2.7(h) and the last sentence of Section 2.7(l). Seller hereby
acknowledges receipt of a copy of the Good Standing Certificate required to be
delivered by Buyer under Section 2.7(k) and waives the receipt of an original
certificate as a condition of Closing. Notwithstanding the preceding sentence,
Buyer shall deliver a Good Standing Certificate to Seller in compliance with the
provisions of Section 2.7(k) within three business days after the Closing.
3. BANK ACCOUNT. Buyer and Seller shall establish and maintain a bank
account in the sole name of Buyer and under Buyer's federal employer
identification number (the "BANK ACCOUNT"). Until such time as Seller has
delivered to Buyer the consent set forth on SCHEDULE 3.5, Item 3, Seller shall
irrevocably designate the Bank Account as the sole and direct destination for
all payments with respect to the Egyptian Contract (and any add-on contract,
extension agreement, modification agreement and upgrade contract related
thereto) and Buyer shall not take any action inconsistent with such designation.
Buyer shall have sole authority to designate signatories on the Bank Account and
to make distributions from the Bank Account. All payments with respect to the
Egyptian Contract (and any add-on contract, extension agreement, modification
agreement and upgrade contract related thereto), and all proceeds thereof, are
the property of Buyer and any such payments, and proceeds thereof, actually
received by or under the custody or control of Seller shall be held by Seller in
trust for the benefit of Buyer.
4. GRANT OF SECURITY INTEREST. Until such time as Seller has delivered to
Buyer the consent set forth on SCHEDULE 3.5, Item 3, Seller hereby grants to
Buyer a continuing security interest (the "SECURITY INTEREST") in and to all
payments with respect to the Egyptian Contract and any add-on contract,
extension agreement, modification agreement and upgrade contract related
thereto, and all proceeds thereof. All payments with respect to the Egyptian
Contract (and any add-on contract, extension agreement, modification agreement
and upgrade contract related thereto), and all proceeds thereof, are the
property of Buyer and any such payments, and proceeds thereof, actually received
by or under the custody or control of Seller shall be held by Seller in trust
for the benefit of Buyer. The Security Interest shall terminate immediately upon
delivery by Buyer to Seller of the consent set forth on SCHEDULE 3.5, Item 3,
and Buyer shall terminate any lien of record relating to the Security Interest.
5. FULL FORCE AND EFFECT. Except as expressly amended by this Amendment
No. 1, the Agreement of Purchase shall remain in full force and effect in
accordance with its terms.
[Signature page follows.]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to
be duly executed and delivered on its behalf by an officer thereunto duly
authorized, all as of the date first written above.
PERCEPTRONICS, INC.
By: /s/ XXXXXXX XXXXXXX
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Name: Xxxxxxx Xxxxxxx
Title: President and Secretary
EIDETICS CORPORATION
By: /s/ XXXXX XXXXX
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Name: Xxxxx Xxxxx
Title: President and Assistant Secretary
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