FIRST AMENDMENT TO MERGER AGREEMENT
This First Amendment dated June 28, 1999 ("Amendment") to that certain
Agreement and plan of Reorganization and Merger, dated as of May 21, 1999
("Merger Agreement"), among Big City bagels, Inc., a New York corporation ("Big
city"), BCB Acquisition Corp. I ("BCB I") and BCB Acquisition Corp. II (BCB
II"), Intelligent Computer Solutions, Inc. ("ICS") and VillageNet, Inc.,
("VillageNet") and each of the stockholders of ICS and VillageNet, all of whom
are listed in Schedule 2.1 to the Merger Agreement. Terms not otherwise defined
in this Amendment will be deemed to have the definitions assigned to them in the
Merger Agreement.
It is agreed that:
ARTICLE I
Section 1.1. The Section 2.1 of the Merger Agreement is amended and
restated as follows:
"Conversion of the Stock of the Target Corporations. At the
Effective Time, (i) the 1,000 shares of the common stock, no par value
and the 40 shares of the preferred stock, no par value of ICS ("ICS
Stock"), representing all the outstanding capital stock of ICS, shall
be converted into the right to receive, at the Closing in accordance
with the BCL, 4,309,733 shares of the common stock, $.001 par value of
Big City ("Big City Common Stock") and 254,076 shares of the Class B
Preferred Stock, $.001 par value ("Big City Preferred Stock") ("ICS
Merger Consideration") and (ii) the 1,000 shares of the common stock,
no par value, of VillageNet ("VillageNet Stock"), representing all the
outstanding capital stock of VillageNet, shall be converted into the
right to receive, at the Closing in accordance with the BCL, 4,309,733
shares of Big City Common Stock and 254,076 shares of Big City
Preferred Stock ("VillageNet Merger Consideration"). The ICS Merger
Consideration and VillageNet Merger Consideration will collectively be
referred to herein as "Merger Consideration". At the Closing, the ICS
Merger Consideration and the VillageNet Merger Consideration,
respectively, will be issued to the Stockholders listed on Schedule 2.1
hereto, in the amounts to be provided to Big City prior to Closing upon
delivery by the Stockholders to Big City of the certificates
representing the ICS Stock and VillageNet Stock together with executed
stock powers. At the Effective Time, all of the 100 shares of common
stock, no par value, of each of BCB I and BCB II outstanding
immediately prior to the Effective Time shall be converted into and
exchanged for 100 shares of the common stock, no par value, of ICS and
VillageNet, respectively, as the surviving corporations of the Merger,
which shall represent all of the issued and outstanding shares of
capital stock of each of ICS and VillageNet, respectively, as the
surviving corporations of the Merger. At the Closing, each of ICS and
VillageNet, as the surviving corporations of the Merger, shall issue to
Big City a stock certificate representing such 100 shares in exchange
for the certificate which formerly represented the 100 shares of common
stock, no par value, of each of BCB I and BCB II."
Section 1.2. The Section 4.24 of the Merger Agreement is amended and
restated as follows:
"Collateral Agreements. (a) Big City has executed the
Severance Agreement and Option Agreement for Xxxx Xxxxxxx in the form
of Exhibit C-1 and Exhibit C-2 to the Merger Agreement and the
Amendment to the Severance and Consulting Agreement in the form of
Exhibit A to this Amendment and (b) Big City has executed the Warrants
granting to Xxxxxx, Xxxxxx & Xxxxxxxxx Capital Corp. the right to
purchase up to 500,000 shares of the Common Stock of Big City in the
form of Exhibit F to the Merger Agreement."
Section 1.3. The Section 4.4 of the Merger Agreement is amended to add
the following sentence at the end of the Section:
"As of the date of the Closing, the only awards made under the 1998
Plan are an option to purchase 100,000 shares of Big City Stock, the
option to Xxxx Xxxxxxx referred to in Section 4.24 of the Merger
Agreement and the award of shares of Big City Stock under the Amendment
to Severance and Consulting Agreement as provided in Exhibit A to this
Amendment."
Section 1.4. The Section 7.16 of the Merger Agreement is amended and
restated as follows:
"Amendment to Certificate of Incorporation. Prior to the
Closing Date, the board of directors of Big City will approve the
Amendment to the Certificate of Incorporation to fix the terms of the
Big City Preferred Stock, as set forth in Exhibit B to this Amendment,
and file the amendment with the Secretary of State of New York."
Section 1.5. The Section 7.1(d) of the Merger Agreement is amended to
add the following at the end thereof:
"notwithstanding the foregoing, Big City may issue up to 125,000
shares of Big City Stock under the 1998 Plan in connection with the
Amendment to Severance and Consulting Agreement as set forth in Exhibit
A to this Amendment."
Section 1.6. The Section 9.1(c) of the Merger Agreement is amended and
restated as follows:
"Amendment to Big City certificate of Incorporation. The board
of directors of Big City will have approved the Certificate of
Amendment to the Certificate of Incorporation establishing the Big City
Preferred Stock in the form of Exhibit B to this Amendment, and the
Certificate of Amendment will have been filed with the Secretary of
State of the State of New York."
Section 1.7. The Section 9.2(b) of the Merger Agreement is amended and
restated as follows:
"Certain Employment and Option Matters. Big City shall have
entered into the Severance Agreement and the Option Agreement with Xxxx
Xxxxxxx, each in the form of Exhibit C-1 and Exhibit C-2 hereof,
respectively and the Amendment to the Severance and Consulting
Agreement in the form of Exhibit A to this Amendment."
ARTICLE II
Section 2.1. This Amendment may be executed in one or more
counterparts, and by the different Parties in separate counterparts, each of
which when executed will be deemed to be an original but all of which when taken
together will constitute one and the same agreement.
Section 2.2. The Merger Agreement, as amended by this Amendment, will
continue in full force and effect. In the event of any inconsistency between the
Merger Agreement and the Exhibits and Schedules thereto and this Amendment, the
provisions of this Amendment will prevail.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be
executed as of the date first written above.
BCB ACQUISITION CORP. I INTELLIGENT COMPUTER SOLUTIONS, INC.
By:__________________________________ By:_________________________________
BCB ACQUISITION CORP. II
By:__________________________________
BIG CITY BAGELS, INC. VILLAGENET, INC.
By:__________________________________ By:_________________________________
_____________________________________ ____________________________________
Xxxxx Xxxxxx, Stockholder Xxxxxx Xxxx, Stockholder
_____________________________________ ____________________________________
Xxxxx Xxxx, Stockholder Xxxxx Xxxx, Stockholder
Xxx Xxxx Living Trust, Stockholder
____________________________________ By:_________________________________
Xxxxxxx Xxxx, custodian for Xxxxx Xxxx, Xxx Xxxx, Trustee
Stockholder
Xxxxxxx Xxxx Living Trust, Stockholder
By:_________________________________ ____________________________________
Xxxxxxx Xxxx, Trustee Xxxxxx X. Xxxxxxx, Stockholder
____________________________________ ____________________________________
Xxxxxx X. Xxxxxxx, Stockholder Xxxxxx X. Xxxxxxx, custodian for
Xxxxxxxxx X. Xxxxxxx, Stockholder
____________________________________
____________________________________ Xxxx X. Xxxxxxx, Stockholder
Xxxxxxx X. Xxxxxxx, Stockholder
____________________________________ ____________________________________
Xxxxxxxx X. Xxxxxxx, Stockholder Xxxxxxx X. Xxxxxxx, custodian for
Xxxxxx X. Xxxxxxx, Stockholder
____________________________________ ____________________________________
Xxxx X. Xxxxxxx, custodian for Xxxxxxx X. Xxxxxxx, Stockholder
Xxxxxx X. Xxxxxxx, Stockholder
