Contract
EXHIBIT
A
AMENDMENT
NO. 1
TO
AMENDMENT NO. 1 TO AGREEMENT AND PLAN
OF MERGER (this “Amendment”),
effective as of March 19, 2010, among FIRECOM, INC., a New York corporation
(“Parent”), FCI
MERGER CORP., a Delaware corporation (“Merger Sub”), and
SYNERGX SYSTEMS INC., a Delaware corporation (the “Company”).
RECITALS
WHEREAS, Parent, Merger Sub and the
Company (sometimes collectively, the “Parties”) are parties
to an Agreement and Plan of Merger, dated as of January 22, 2010 (the “Merger Agreement”);
and
WHEREAS, the Parties desire to amend
the Merger Agreement to reflect mutually agreed upon revised terms for the
merger transaction set forth therein, in accordance with the provisions of this
Amendment.
NOW, THEREFORE, in consideration of the
promises and mutual covenants contained herein, and intending to be legally
bound hereby, the Parties hereto agree as follows:
1. Definitions. Capitalized
terms used herein, but not otherwise defined, shall have the meanings ascribed
to them in the Merger Agreement.
2. Amendments. Pursuant
to Section 9.03 of the Merger Agreement, the Parties hereby agree to the
following amendments to the Merger Agreement:
2.1 The first Recital is
amended to provide that upon the Merger, each of the issued and outstanding
shares of the Company Stock, other than any Appraisal Shares or Cancelled
Shares, will be converted into the right to receive seventy ($.70) cents in
cash, per share, without interest (the “Merger
Consideration”).
2.2 Section 6.02(a) of the
Merger Agreement is amended by adding the following sentence at the end of the
definition of Superior Proposal:
“In addition, because of the costs
incurred, or to be incurred, and the time to be expended, by the Company in
gathering and furnishing information to and otherwise dealing with Persons or
groups of Persons who present Takeover Proposals, upon the Special Committee
determining that a specific Takeover Proposal constitutes a Superior Proposal,
the Person or group of Persons who presented such Takeover Proposal shall pay
One Hundred Thousand ($100,000) Dollars to the Company as a non-refundable
deposit, to be used in connection with the Company’s expenses related to the
transaction contemplated under such Takeover Proposal and for payment of the
Company’s obligations arising from the termination of this
Agreement. Upon entry by such Person or group of Persons into a
definitive acquisition agreement with the Company, they shall deposit Four
Hundred Thousand ($400,000) Dollars into an escrow arrangement similar to
arrangement in the Escrow Agreement referred to in Section 7.05(f)
herein.”
2.3 Section 6.02(b) of the
Merger Agreement is amended by adding the following sentence at the end of such
Section:
“As of the effective date of the
Amendment to this Agreement, no Person or group of Persons shall be deemed a
Solicited Party. In addition, any Person or group of Persons with
which the Company (including members of the Special Committee) and other
Representatives, and the Financial Advisor, had contact during the Solicitation
Period with respect to a Takeover Proposal and had been deemed a Solicited Party
shall any longer be considered a Solicited Party for all purposes of the
Agreement.”
2.4 Section 7.05(f) of the
Merger Agreement is renumbered to be Section 7.05(g), and the following shall be
Section 7.05(f):
“(f) Escrow
Deposit. Within ten (10) Business Days after the effective
date of the Amendment, Parent shall deposit the sum of Five Hundred Thousand
($500,000) Dollars (the “Escrow Funds”) in
escrow with Sichenzia Xxxx Xxxxxxxx Xxxxxxx LLP (the “Escrow Agent”),
pursuant to an escrow agreement (the “Escrow Agreement”) in
form satisfactory to the Company, Parent and the Escrow Agent. The
Escrow Funds shall be held under the Escrow Agreement until the first to occur
of: (i) the Closing Date, at which time the Escrow Funds shall be applied to the
Merger Consideration and delivered to the Paying Agent in accordance with
Section 3.02(a) herein; or (ii) the termination of the Agreement other than
pursuant to Section 9.01(b)(ii) herein, at which time the Escrow Funds shall be
delivered to Parent, subject to the Company’s rights under Section 7.05(d)
herein; or (iii) the termination of the Agreement solely pursuant to Section
9.01(b)(ii) herein, at which time the Escrow Funds shall be delivered to the
Company; or (iv) as otherwise provided in the Escrow Agreement.”
2.5 Section 7.07 of the
Merger Agreement is amended to read as follows:
“The Company has obtained a
forebearance agreement (the “Forbearance
Agreement”) from TD Bank, N.A. (the “Bank”) to the Company
and Xxxxx Systems, Inc., Xxxxx Fire Systems, Inc. and Xxxxx Technologies, Inc.
as to the enforcement through April 30, 2010 of the Bank’s rights under the
credit facility that it has extended to the Company. The Company
agrees to maintain the Forebearance Agreement as currently in effect and to use
its best efforts to have the Bank extend the Forbearance Agreement to June 30,
2010 and on such other terms as otherwise reasonably satisfactory to
Parent. At the request of the Bank, Parent shall furnish a guaranty
of the Company’s credit facility upon terms mutually agreeable to the Bank and
Parent, which guaranty shall become effective as of the Closing
Date. From the date of the Merger Agreement until the Closing Date,
the Bank shall not have demanded immediate payments of the obligations of the
Company and its Subsidiaries with respect to the credit facility nor shall it
have commenced collection or other enforcement action against the Company or the
Subsidiaries on any amounts due to the Bank.”
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2.6 ARTICLE VII of the
Merger Agreement shall be amended by adding the following as Section 7.09
thereto:
“Upon the request of the Company and
upon the concurrence of Parent, Parent and the Company shall negotiate in good
faith for Parent to guaranty the obligations of the Company to third parties
under contracts (other than to the Bank pursuant to Section 7.07 herein) with
the Company or its Subsidiaries, with the terms of the guaranties (the “Contract Guaranties”)
being at the discretion of the Parent. The Contract Guaranties shall
provide that the obligation of Parent thereunder shall cease upon the
termination of this Agreement, and that if this Agreement is terminated pursuant
to Section 9.01(e), the party which made a proposal determined to a Superior
Proposal shall provide a substitute Contract Guaranty or assume Parent’s
obligations under any Contract Guaranty unless such Contract Guaranty is waived
by the recipient of such Contract Guaranty; provided, that any such waiver shall
not affect the termination of the Contract Guaranties previously furnished by
Parent.”
2.7 Section 9.01(b)(i) of
the Merger Agreement shall be amended by changing the Outside Date from “April
30, 2010”to “June 30, 2010.”
3. Reference to and Effect on
the Merger Agreement.
3.1 On and after the
effective date of this Amendment, each reference to “this Agreement.”
“hereunder,” “hereof,” “herein” or words of like import shall mean and be a
reference to the Merger Agreement as amended hereby.
3.2 Except as expressly
amended by this Amendment, the provisions of the Merger Agreement shall remain
in full force and effect.
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4. Counterparts. This
Amendment may be executed in one or more counterparts, each of which shall be
deemed an original, and all of which shall constitute a single
instrument.
IN
WITNESS WHEREOF, the undersigned have caused this Amendment to the Merger
Agreement to be executed and delivered by its respective officers hereunto duly
authorized on the date first above written.
| FIRECOM, INC. | |||
| By: | /s/ Xxxxxxx Xxxxx | ||
| Name: | Xxxxxxx Xxxxx | ||
| Title: | Vice President, Finance | ||
| FIC MERGER CORP. | |||
| By: | /s/ Xxxxxxx Xxxxx | ||
| Name: | Xxxxxxx Xxxxx | ||
| Title: | Vice President | ||
| SYNERGX SYSTEMS INC. | |||
| By: | /s/ Xxxx Xxxxxxxx | ||
| Name: | Xxxx Xxxxxxxx | ||
| Title: | Vice President and CFO | ||
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