AMENDMENT NO. 1, dated August 3, 1998 to Agreement and Plan of Merger
(the "Agreement") made as of July 24, 1998, by and among COMC, Inc., an Illinois
corporation with an office at 000 Xxxxx Xxxxxxxx Xxxxxxxxx, Xxxxxxx, Xxxxxxxxxx
00000 (the "Company"), COMC Acquisition Corp., a California corporation and a
wholly owned subsidiary of the Company having an address c/o the Company
("Subsidiary"), ICF Communication Systems Inc., a California corporation having
an office at 0000 Xxxx Xxxx, Xxxxx X, Xxxxxxxx, Xxxxxxxxxx 00000-0000 ("ICF"),
Xxxxxxx X. Xxxxx, having an address at 000 Xxxxxxxxx, Xxxxxxxx, Xxxxxxxxxx 00000
("Xxxxx"), Xxxxxxx X. Xxxxxxx, having an address at 000 Xxxxx Xxxxx, Xxxxx,
Xxxxxxxxxx 00000 ("Lincoln," together with Xxxxx herein sometimes referred to as
the "Shareholders"). Terms not otherwise defined herein shall have the meaning
ascribed to them in the Agreement.
W I T N E S S E T H :
WHEREAS, the parties to the Agreement have agreed to certain amendments
to the Agreement as hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual agreements, covenants
and representations and warranties hereinafter set forth, the parties hereby
agree as follows:
1. Article 2.4(d) is hereby amended to read as follows:
"(d) Directors and Officers. Effective on the Closing Date, the Board
of Directors of the Surviving Corporation shall consist of all members of the
Board of Directors of the Company immediately after the Closing and two
individuals nominated by Lincoln and Xxxxx who must be employees of the
Surviving Corporation. Xxxxx shall be appointed President and Lincoln shall be
appointed Chairman of the Surviving Corporation. In addition, one person to be
designated by Xxxxx and Lincoln shall be appointed as an executive officer of
the Surviving Corporation. Xxxxx Xxxxxxxxx shall be appointed Chief Financial
Officer of the Surviving Corporation."
2. Article 2.5(a) is hereby amended to read as follows:
"(a) Upon consummation of the Merger, all shares of ICF Stock
outstanding immediately prior to the Effective Date shall, by virtue of the
Merger and without any action on the part of the holder thereof be canceled and
the holders of said shares immediately prior to the Effective Date shall by
virtue of the Merger and without any action on their part have the right to
receive:
(i) $1,500,000 in cash to be paid at the Closing;
(ii) $1,500,000 on January 5, 1999 under the terms of two
separate secured promissory notes in the form attached
hereto as Exhibit F (the "Secured Notes");
(iii) $1,000,000 on January 4, 1999 under the
terms of two separate promissory notes in
the form attached hereto as Exhibit B;
(iv) $1,000,000 on the first anniversary of the Closing under the
terms of two separate promissory notes in the form
attached hereto as Exhibit C (together with the Secured
Notes and the promissory notes under paragraph (iii)hereof,
the "Promissory Notes"); and
(v) $9,000,000 in shares of Common Stock."
3. There shall be added a new Section 2.5(e) which shall read as
follows:
"(e) The Secured Notes shall be entitled to the benefits of a Pledge
and Security Agreement in the form attached hereto as Exhibit G."
4. Exhibits F and G are attached to this Amendment.
5. Other than as specifically set forth herein, the Agreement is in all
respects ratified and confirmed.
6. This Amendment may be executed in counterparts and by facsimile
transmission.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed as of the day and year first written above.
COMC, INC.
By:
COMC ACQUISITION CORP.
By:
ICF COMMUNICATION SYSTEMS, INC.
By:
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxx
EXHIBIT F
FORM OF SECURED PROMISSORY NOTE
$750,000
August ___, 1998
For value received, COMC, INC., an Illinois corporation having an
address 000 Xxxxx Xxxxxxxx Xxxxxxxxx, Xxxxxxx, Xxxxxxxxxx 00000 ("Maker"),
hereby promises to pay to Xxxxxxx X. Xxxxxxx ("Payee"), at his office at 000
Xxxxx Xxxxx, Xxxxx, Xxxxxxxxxx 00000, or at such other place as Payee shall from
time to time designate to Maker in writing, the sum set forth above. Interest
shall accrue on the principal amount from time to time outstanding and unpaid at
the rate of 8% per annum (10% in the event of a default). Principal and interest
accruing on this Note shall be payable on January 5, 1999, subject to prepayment
as hereinafter provided. This Note is executed in accordance with the terms of
that certain Agreement and Plan of Merger dated __________, 1998 by and between
Maker, COMC Acquisition, Inc., ICF Communication Systems, Inc., Xxxxxxx Xxxxxxx
and Xxxxxxx X. Xxxxx (as subsequently amended, the "Agreement"). In the event of
a default in the payment of principal or interest, Maker, at the option of
Payee, will issue to Payee shares of Maker's Common Stock par value $.01 (the
"Common Stock"), valued in accordance with Section 2.5(b) of the Agreement.
The principal due hereunder may be paid in whole, or in partial
payments at any time before it is payable under this Note without premium or
penalty.
The entire principal amount of this Note, together with accrued
interest, shall be payable on the occurrence of any of the following events
(each an "Event of Default"):
A. Maker shall be in default in the payment of principal or interest
due and demanded under this Note;
B. Payee shall be dismissed without cause as defined in that certain
Employment Agreement of even date hereof between Payee and COMC Acquisition
Corp. or its successor;
C. a judgment in any amount is rendered against the Maker and the same
shall remain undischarged for a period in excess of thirty (30) days or
execution shall at any time not be effectively stayed; or
D. Maker shall suspend or discontinue doing business for any reason,
become insolvent, call a meeting of creditors, have a creditors' committee
appointed, make a general assignment for the benefit of creditors or shall admit
in writing its inability to pay its debts as they become due or shall commence
or shall have commenced against it any action or proceeding for relief under the
United States Bankruptcy Code or any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under the United States
Bankruptcy Code or any other present or future statute, law or regulation or
shall file any answer admitting or not contesting the allegations of a petition
filed against it in any such proceeding or shall seek or consent to or acquiesce
in the appointment of any trustee, receiver or liquidator of the Maker, or all
or any part of its properties or assets, or shall have its assets attached or be
subject to receivership.
In the event of a default of Maker's obligation to make the principal
payment hereunder, it will, in lieu of cash at Payee's option, forthwith issue
to Payee 500,000 shares of Common Stock plus an amount in shares of Common Stock
(valued at a price of $1.50 per share) equal to the accrued interest due
hereunder. The number of shares of Common Stock to be issued hereunder (and the
Closing Price, as defined in the Agreement, as appropriate) shall be adjusted in
the event of a stock split or other type of corporate reorganization. As a
condition to the issuance of Common Stock, to assure compliance with federal and
state securities laws, Payee shall be required to execute and deliver to the
Company an instrument certifying that the shares of Common Stock are being
acquired for the sole account of Payee and not with a view to any resale or
distribution.
The Common Stock to be issued under the preceding sentence shall be
included in the Registration Statement (as defined in the Agreement). In the
event that Maker shall have filed the Registration Statement prior to the
issuance of the Common Stock, it shall, prior to effectiveness of the
Registration Statement, file an amendment to the Registration Statement to
include the Common Stock in the Registration Statement. If the Registration
Statement shall have become effective prior to the issuance of the Common Stock,
the Company shall as soon as possible file a new registration statement with
respect to the Common Stock under the same terms (other than the time period to
allow registration) set forth in the Agreement. Maker shall pay all expenses of
the registration hereunder. In no event, however, shall Maker pay Payee's
underwriting discounts or the fees of Payee's personal counsel.
In addition, if Maker at any time proposes to register any of its
securities under the Securities Act of 1933, as amended, for sale to the public,
whether for its own account or for the account of other security holders or both
(except with respect to registration statements on Forms X-0, X-0 or another
form not available for registering the Common Stock for sale to the public), it
will give written notice to Payee of its intention so to do. Upon the written
request of Payee, Maker will use its best efforts to cause the Common Stock as
to which registration shall have been so requested to be included in the
securities to be covered by the registration statement proposed to be filed by
Maker. In the event that any registration pursuant to this subsection shall be,
in whole or in part, an underwritten public offering of Common Stock, the number
of shares of Common Stock to be included in such an underwriting may be reduced
if and to the extent that the managing underwriter shall be of the opinion that
such inclusion would adversely affect the marketing of the securities to be sold
by Maker therein.
Any and all notices or other communications required or permitted to be
given under any of the provisions of this Note shall be in writing and shall be
deemed to have been duly given when personally delivered or mailed by first
class certified mail, return receipt requested, addressed to the parties at
their respective addresses set forth above (or at such other address as any
party may specify by notice to all other parties given as aforesaid).
This Note is entitled to the benefits of and secured by that certain
Pledge and Security Agreement of even date herewith by and between Payee and
COMC Acquisition Corp., a California corporation and wholly-owned subsidiary of
Maker.
This Note shall be governed by, and interpreted and construed in
accordance with, and be under the jurisdiction of the laws of the State of
California. All disputes relating to the interpretation and enforcement of the
provisions of this Note shall be resolved and determined exclusively by the
state or federal courts sitting in the County of Santa Clara, California, and
such courts are hereby granted exclusive jurisdiction for such purpose. Trial by
jury is waived. Service of process shall be effective when given by certified
mail or private courier at the address above written. The holder of this Note
shall be entitled on demand to recover costs of collection, which costs shall
accrue interest payable on demand at the rate set forth above. This Note may not
be changed or terminated orally.
In the event of any litigation or arbitration arising under this Note,
proceeds to judgment or an award, the losing party of any claim arising
thereunder shall pay to the prevailing party all of its costs and expenses
incurred in connection with the prosecution or defense of such claim including,
but not limited to, any and all reasonable attorney's fees.
COMC, INC.
By:
