Exhibit 2.1(b)
FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER
This FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER (this "Amendment") is
made and entered into as of November 25, 2003, by and among NOMOS Corporation, a
Delaware corporation (the "Company"), North American Scientific, Inc., a
Delaware corporation ("Acquiror"), and AM Capital I, Inc., a Delaware
corporation and wholly-owned subsidiary of Acquiror ("Merger Sub").
RECITALS
WHEREAS, the Company, Acquiror and Merger Sub entered into the Agreement
and Plan of Merger, dated as of October 26, 2003 (the "Merger Agreement"), which
provides for the merger (the "Merger") of the Company with and into Merger Sub,
which shall continue as surviving corporation in the Merger, on the terms and
subject to the conditions set forth therein;
WHEREAS, on November 4, 2003 Xxxxxx/Xxxxxx Incorporated made a demand
against the Company for a sum of approximately $2,250,000 (the "Demand Amount")
which Xxxxxx/Hunter alleges is due in connection with the Merger pursuant to the
terms of an engagement letter executed by the Company dated June 2, 2000 (any
dispute, claim or controversy arising out of such demand being referred to
herein as the "Xxxxxx/Xxxxxx Dispute"); and
WHEREAS, in order to establish a separate escrow fund under the
Indemnification Escrow Agreement to secure indemnification obligations to the
Acquiror Indemnified Parties under the Merger Agreement in respect of any
Damages (including, without limitation, the Demand Amount and anticipated
attorneys' fees and expenses incurred in investigating and preparing for any
litigation or proceeding) that has been or may be incurred by the Company or the
Acquiror Indemnified Parties in connection with the Xxxxxx/Hunter Dispute after
the date of the Merger Agreement, the Company, Acquiror and Merger Sub desire to
amend the Merger Agreement as set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
promises and covenants contained in this Amendment, and for other good and
valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound, hereby agree as
follows:
1. Certain Definitions. All capitalized terms used but not defined herein
are used herein as defined in the Merger Agreement.
2. Indemnification Escrow Agreement. Section 3.6 of the Merger Agreement
is hereby amended and restated in its entirety as follows:
"3.6 Indemnification Escrow Agreement. Pursuant to Article XII hereof, the
stockholders of the Company shall indemnify and hold the Acquiror and the
Surviving Corporation harmless from and against certain Indemnified Losses
(as hereinafter defined). On or prior to Closing, Acquiror, an escrow
agent (the "Escrow Agent") mutually agreed upon by Acquiror and the
Company, and the
Company, on behalf of its stockholders, shall enter into an
Indemnification Escrow Agreement in substantially the form of Exhibit 3.5
attached hereto (as the same may be modified pursuant to mutual agreement
of the parties hereto prior to the Closing, the "Indemnification Escrow
Agreement"). Notwithstanding any other provision in this Agreement to the
contrary (a) in order to secure the general indemnification obligations to
the Acquiror Indemnified Parties (as hereinafter defined) under this
Agreement, other than with respect to any Special Indemnified Losses (as
hereinafter defined), a certificate evidencing ten percent (10%) of the
shares of Acquiror Common Stock which would otherwise be delivered to the
stockholders of the Company at Closing pursuant to Section 3.3 hereof
(collectively, the "General Escrowed Shares") shall be registered in the
name of the Escrow Agent, as nominee for the stockholders of the Company,
and ten percent (10%) of the aggregate amount of cash which would
otherwise be delivered to the stockholders of the Company pursuant to
Section 3.3 hereof (the "General Escrowed Cash") shall instead be
deposited into and held in escrow (the "General Escrow Fund") pursuant to
the terms of the Indemnification Escrow Agreement and (b) in order to
secure the indemnification obligations to the Acquiror Indemnified Parties
under this Agreement solely with respect to any Special Indemnified
Losses, a certificate evidencing 307,617 shares of Acquiror Common Stock
which would otherwise be delivered to the stockholders of the Company
pursuant to Section 3.3 hereof (collectively, the "Special Escrowed
Shares") shall be registered in the name of the Escrow Agent, as nominee
for the stockholders of the Company, and an aggregate amount of cash equal
to $700,800 which would otherwise be delivered to the stockholders of the
Company pursuant to Section 3.3 hereof (the "Special Escrowed Cash"),
shall instead be deposited into and held in escrow (the "Special Escrow
Fund"), separate from the General Escrow Fund, pursuant to the terms of
the Indemnification Escrow Agreement. Acquiror is hereby directed by the
Company, on behalf of each of the Company's stockholders, to deposit the
number of General Escrowed Shares and Special Escrowed Shares
(collectively, the "Escrowed Shares") and amount of General Escrowed Cash
and Special Escrowed Cash (collectively, the "Escrowed Cash") set forth
opposite such stockholder's name in Annex A to the Indemnification Escrow
Agreement with the Escrow Agent at the Closing, and Acquiror shall make
such deposit as so directed and as contemplated in the preceding
sentence."
3. Indemnification Escrow Agreement. Section 3.7 of the Merger Agreement
is hereby amended and restated in its entirety as follows:
"3.7 Appointment of Stockholder Representative. By virtue of the approval
of this Agreement by the holders of Company Common Stock and Company
Preferred Stock, Xxxx X. Xxxxxx shall be approved as and appointed by the
Company to be the "Stockholder Representative" under the Indemnification
Escrow Agreement (the "Stockholder Representative") and shall be
constituted and appointed as agent and attorney-in-fact for and on behalf
of each such holder. The Stockholder Representative shall have full power
and authority to represent such holders and their successors with respect
to all matters arising under the Indemnification Escrow Agreement and all
actions taken by the Stockholder Representative thereunder shall be
binding upon all
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stockholders and their successors as if expressly confirmed and ratified
in writing by each of them, including, without limitation, resolving all
claims relating to the General Escrow Fund and the Special Escrow Fund and
any indemnification claims and obligations."
4. Definitions. The following definitions are hereby added to Article XI
of the Merger Agreement:
"'Xxxxxx/Hunter' means Xxxxxx/Xxxxxx Incorporated."
"'Xxxxxx/Hunter Dispute' means any dispute, claim or controversy
(including, without limitation, any action, suit, proceeding, hearing or
investigation of, in, or before any court or quasi-judicial or
administrative agency of any federal, state, local or foreign jurisdiction
or before any arbitrator) relating to or arising out of the demand made by
Xxxxxx/Xxxxxx against the Company on November 4, 2003 for a sum of
approximately $2,250,000 that Xxxxxx/Hunter alleges is due in connection
with the Merger pursuant to the terms of an engagement letter executed by
the Company dated June 2, 2000."
5. Indemnification of Acquiror Indemnified Parties. Section 12.1 of the
Merger Agreement is hereby amended and restated in its entirety as follows:
"12.1 Indemnification of Acquiror Indemnified Parties. Each stockholder of
the Company, jointly and severally (an "Indemnifying Party"), shall
indemnify and hold harmless Acquiror and the Surviving Corporation, and
their respective officers, directors, employees, consultants, stockholders
and affiliates (collectively, the "Acquiror Indemnified Parties") from and
against any and all damages, losses, claims, liabilities, demands,
charges, suits, penalties, costs and expenses, including court costs and
reasonable attorneys' fees and expenses incurred in investigating and
preparing for any litigation or proceeding (collectively, "Damages") which
any of the Acquiror Indemnified Parties shall have actually sustained, or
to which any of Acquiror Indemnified Parties shall have actually been
subjected, relating to or arising directly or indirectly out of (i) any
breach or default by the Company of any of its representations or
warranties contained in Article V hereof or any covenants or agreements
under this Agreement or (ii) the Xxxxxx/Xxxxxx Dispute, which for the
removal of doubt would include, without limitation, any Damages incurred
by any Acquiror Indemnified Parties or the Company between the date of the
Merger Agreement and the Closing. Any Damages relating to or arising out
of the Xxxxxx/Hunter Dispute which any Acquiror Indemnified Party or the
Company shall have actually sustained, or to which any of the Acquiror
Indemnified Parties the Company shall have actually been subjected, are
referred to herein as 'Special Indemnified Losses'. Any Damages, other
than Special Indemnified Losses, which any Acquiror Indemnified Party
shall have actually sustained, or to which any of the Acquiror Indemnified
Parties shall have actually been subjected, are referred to herein as
'General Indemnified Losses'. The Special Indemnified Losses and General
Indemnified Losses shall be referred to herein as 'Indemnified Losses'."
6. Limitations on Liability. Section 12.4 of the Merger Agreement is
hereby amended and restated in its entirety as follows:
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"12.4 Limitations on Liability.
(a) Notwithstanding anything contained herein to the contrary, no
Indemnifying Party shall have any indemnification obligations under this
Article XII with respect to General Indemnified Losses until such time as
the aggregate General Indemnified Losses for which the Acquiror
Indemnified Parties are otherwise entitled to indemnification hereunder
equals or exceeds $400,000 (the "Basket"), at which point, the
Indemnifying Party shall be liable for the full amount of all such General
Indemnified Losses without regard to the Basket. The Special Indemnified
Losses are not subject to or limited in any way by the Basket, and the
Indemnifying Parties shall be liable for the full amount of all such
Special Indemnified Losses.
(b) The aggregate indemnification obligations under this Article XII
with respect to General Indemnified Losses shall be capped at 10% of the
aggregate Merger Consideration. The rights of the Acquiror Indemnified
Parties to make claims against the Escrowed Shares, Escrowed Cash and any
proceeds thereof shall be the sole and exclusive remedy of such Acquiror
Indemnified Parties after the Closing with respect to any representation
and warranty, covenant or agreement made by the Company under this
Agreement and with respect to the Xxxxxx/Xxxxxx Dispute and no former
stockholder, optionholder, warrantholder, director, officer, employee or
agent of the Company shall have any personal liability hereunder to the
Acquiror Indemnified Parties after the Closing in connection with the
Merger.
(c) If any matters giving rise to a claim of General Indemnified
Losses pursuant to this Article XII by the Acquiror Indemnified Parties is
reasonably likely to be covered by any insurance policy of Acquiror, then
no amount shall be recovered pursuant to this Article XII unless and until
such Acquiror Indemnified Parties shall have made all commercially
reasonable efforts for a period of six months to obtain reimbursement for
such General Indemnified Loss under such insurance policy, and then only
to the extent aggregate insurance proceeds actually received by such
Acquiror Indemnified Parties in respect of all Damages arising from such
claim (less any premium adjustments and similar charges made as a result
of making such claim) are less than such Damages; provided, however, that
if no insurance proceeds are received after making such commercially
reasonable efforts upon the termination of such six month period, such
Acquiror Indemnified Parties shall be entitled to recover the full amount
of such General Indemnified Losses. Matters giving rise to a claim of
Special Indemnified Losses pursuant to this Article XII by the Acquiror
Indemnified Parties shall not be subject to this Section 12.4(c)."
7. Exhibit 3.5; Form of Indemnification Escrow Agreement. On or prior to
the Closing, the parties hereto shall modify the form of Indemnification Escrow
Agreement attached to the Merger Agreement as Exhibit 3.5 (a) to provide for the
establishment, maintenance and administration by the Escrow Agent of the Special
Escrow Fund for the sole purpose of satisfying Claims (as defined in the
Indemnification Escrow Agreement) arising out of the Xxxxxx/Hunter Dispute and
(b) to provide, in form and substance reasonably satisfactory to the Company and
Acquiror, that the Stockholder Representative will be entitled to be indemnified
out of any funds remaining in the General Escrow Fund after any required
distributions to the
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Acquiror Indemnified Parties and the Escrow Agent, but prior to any
distributions to the Stockholders (as defined in the Escrow Agreement), to cover
any losses that may incurred by the Stockholder Representative as a result of
actions or inactions taken by the Stockholder Representative in such capacity,
other than losses for which indemnification would be inappropriate (e.g., losses
resulting from willful misconduct, gross negligence or bad faith). For purposes
of clause (a) of this Section 7, the Special Escrow Fund shall be established,
maintained and administered pursuant to provisions substantially similar to the
provisions relating to the establishment, maintenance and administration of the
Escrow Fund as set forth in the form of Indemnification Escrow Agreement
attached as Exhibit 3.5 to the Merger Agreement on the date hereof, except as
set forth below:
(a) the Escrow Termination Date (as defined in the Indemnification
Escrow Agreement) shall be modified to provide for the termination of the
Special Escrow Fund upon the payment of all Claims (as defined in the
Indemnification Escrow Agreement) relating to the Xxxxxx/Xxxxxx Dispute as
soon as practicable after the final resolution of the Xxxxxx/Hunter
Dispute as evidenced by (i) a certified copy of a final non-appealable
judicial order or judgment with respect to the Xxxxxx/Xxxxxx Dispute
setting forth the Claim Amount (as defined in the Indemnification Escrow
Agreement), if any, that the Acquiror Indemnified Parties are entitled to
receive out of the Special Escrow Fund with respect to the Xxxxxx/Hunter
Dispute or (ii) a copy of a written memorandum signed by an Acquiror
Indemnified Party and the Stockholder Representative setting forth the
Claim Amount, if any, that the Acquiror Indemnified Parties are entitled
to receive out of the Special Escrow Fund with respect to the
Xxxxxx/Xxxxxx Dispute;
(b) Sections 5(d) and 5(e) of the Indemnification Escrow Agreement
shall be modified to provide for distributions from the Special Escrow
Fund to be made with a combination of Special Escrowed Cash and Special
Escrowed Shares determined as follows:
(i) a pro rata portion of any Claim Amount to be disbursed in
connection with the Xxxxxx/Hunter Dispute shall be settled from each
Subaccount (as defined in the Indemnification Escrow Agreement)
established under the Special Escrow Fund based upon the relative
proportional value of the Special Escrow Fund then deposited in such
Subaccount, provided that, for the purposes of such valuation, the
value of each Special Escrow Share shall be $7.47 (the
"Pre-Announcement Share Price");
(ii) to the extent that any Subaccount established under the
Special Escrow Fund contains any Special Escrowed Cash, such
disbursable portion of such Claim Amount shall be paid in cash and
the balance of such disbursable portion shall be paid in Special
Escrowed Shares valued at the Pre-Announcement Share Price; and
(iii) to the extent that any Subaccount established under the
Special Escrow Fund only contains Special Escrowed Shares, such
disbursable portion of such Claim Amount shall be paid solely in
Special Escrowed Shares valued at the Pre-Announcement Share Price.
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8. Effect on Merger Agreement. Except as set forth in this Amendment, the
terms and provisions of the Merger Agreement are hereby ratified and declared to
be in full force and effect.
9. Acknowledgement of No Company Material Adverse Effect. Each of the
parties hereto hereby acknowledges and agrees that no breach or alleged breach
by the Company of any representation and warranty, covenant or agreement
contained in the Merger Agreement which relates to or arises out of the
Xxxxxx/Xxxxxx Dispute shall individually, or when taken together with any other
breach or alleged breach by the Company of any representation and warranty,
covenant or agreement, be deemed to constitute a Company Material Adverse
Effect.
10. General Provisions. This Amendment shall become effective upon its
execution, which may occur in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. This Amendment shall be governed by and construed in accordance with
the laws of the State of Delaware applicable to contracts executed and to be
performed wholly within such State. Captions and paragraph headings are used
herein for convenience only, are not a part of this Amendment or the Merger
Agreement as amended by this Amendment and shall not be used in construing
either document. Other than the reference to the Merger Agreement contained in
the first recital of this Amendment, each reference to the Merger Agreement and
any agreement contemplated thereby or executed in connection therewith, whether
or not accompanied by reference to this Amendment, shall be deemed a reference
to the Merger Agreement as amended by this Amendment.
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IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
Agreement and Plan of Merger to be duly executed as of the day and year first
written above.
North American Scientific, Inc.
By: /s/ L. Xxxxxxx Xxxxxx
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Name: L. Xxxxxxx Xxxxxx
Title: President and Chief Executive Officer
NOMOS Corporation
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
Title: President and Chief Executive Officer
AM Capital I, Inc.
By: /s/ L. Xxxxxxx Xxxxxx
--------------------------------------------
Name: L. Xxxxxxx Xxxxxx
Title: President and Chief Executive Officer
