Exhibit 2.2
Century Electronics Manufacturing, Inc.
000 Xxxxx Xxxx Xxxx
Xxxxxxxxxxx, XX 00000
July 30, 1999
Amitek Corporation
0000 Xxxxx Xxxxx Xxxx
Xxxx Xxxxx, XX 00000
Attention: Xx. Xxxxx Xx Park, President
Re: Agreement and Plan of Merger (the "Merger Agreement"), by and
among Century Electronics Manufacturing, Inc., a Delaware
corporation (the "Buyer"), Amitek Corporation, a Florida corporation
("Amitek"), and Xxxxx Xx Park and Xxxx Xxxx Park (the "Principal
Sellers"), dated as of the date hereof
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Ladies and Gentlemen:
Reference is made to the Merger Agreement pursuant to which Amitek will
merge with and into the Buyer on the terms and subject to the conditions of the
Merger Agreement. The parties hereto hereby agree as follows:
1. DEFINITIONS. Capitalized terms used but not otherwise defined in this
letter agreement are used herein as defined in the Merger Agreement.
2. CLOSING. Effective on and as of the date hereof, the parties have agreed on
the form and substance of the Merger Agreement and the agreements and
documents listed on the Closing Agenda attached hereto as Exhibit A
(collectively, the "Transaction Documents"), and all of the Transaction
Documents have been executed and delivered by the parties.
3. CENTENNIAL ADJUSTMENT. Buyer agrees to repurchase on or before September
30, 1999, all of the capital stock, and options, warrants or other
securities convertible into or exchangeable for capital stock, of the Buyer
owned by Centennial Technologies, Inc. ("Centennial") as of the date hereof
or hereafter acquired (the "Centennial Securities"); PROVIDED, HOWEVER,
that the grant to Centennial of warrants for up to 100,000 shares of Common
Stock of the Buyer, with an exercise price of at least $6.00 per share, in
connection with such repurchase shall be permitted and such warrants shall
not be considered Centennial Securities hereunder. In the event that the
Buyer shall fail to repurchase the Centennial Securities on or before
September 30, 1999, the Buyer shall, on or prior to October 2, 1999,
authorize, issue and deliver to the Sellers an amount of Century Common
Stock equal to 108,718 shares (such number of shares calculated as set
forth in Exhibit B hereto).
4. CLOSING DATE PURCHASE PRICE ADJUSTMENT. The Buyer hereby acknowledges the
receipt of the Estimated Closing Date Balance Sheet (attached as Exhibit C
hereto) and waives the requirement for three business days prior notice
under Section 2.10(a) of the Merger
Amitek Corporation -2- July 30, 1999
AGREEMENT. Notwithstanding Section 2.10(b) of the Merger Agreement, no
adjustment to the Purchase Price shall be made on the Closing Date in
respect of the Estimated Closing Date Net Book Value; provided, however,
that if the Buyer fails to deliver to the Principal Sellers the Draft
Closing Date Balance Sheet within the 60-day period referred to in Section
2.11(a) of the Merger Agreement, any adjustment to the Purchase Price that
would have been made on the Closing Date pursuant to Section 2.10(b) but
for this letter agreement shall be made on the 70th day following the
Closing Date in the manner and subject to the limitations set forth in
Section 2.10(b). This letter shall in no way affect the provisions of
Section 2.11 of the Merger Agreement, provided that to the extent such
provisions are applicable, the Closing Date Upward Adjustment and the
Closing Date Downward Adjustment shall be zero.
5. MISCELLANEOUS. Except to the extent amended or modified by this letter
agreement, the provisions of the Merger Agreement shall remain unmodified
and the Merger Agreement as amended and modified hereby is confirmed as
being in full force and effect. No party may assign either this letter
agreement or any of its rights, interests, or obligations hereunder without
the prior written approval of the other parties; provided, however, that the
Buyer may (i) assign any and all of its rights and interests hereunder to
one or more of its Affiliates and (ii) designate one or more of its
Affiliates to perform its obligations hereunder. This letter agreement may
be executed in any number of counterparts, which together shall constitute
one instrument, shall be governed by and construed in accordance with the
laws (other than the conflict of laws rules) of The Commonwealth of
Massachusetts and shall bind and inure to the benefit of the parties hereto
and their respective successors and assigns.
[Remainder of this page intentionally left blank]
EXHIBIT B
SPREADSHEETS RE: SHARE CALCULATION
Advest Investment Banking Amitek/Century Merger CONFIDENTIAL
Consideration - Without Centennial Buyback
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Cash Note Sub Total Shares-C-
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Consideration 6,475,000 8,525,000 15,000,000 2,384,171
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AAA Distribution 0 N/A N/A
LOMBARDO(a) 350,000 308,000 658,000 113,773
XXXXXXX 0 198,000 198,000 34,132
WINANS 0 400,000 400,000
XXXXXXX 0 400,000 400,000
BONUS POOL(b) 471,000 0 471,000
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SUBTOTAL 821,000 1,306,000 2,127,000 147,905
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Bal to Amitek Sh 5,654,000 7,219,000 12,873,000 2,236,266
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KWON 19.66% 1,111,853 1,419,609 2,531,463 439,759
THE PARKS 4,542,147 5,799,391 10,341,537 1,796,507
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5,654,000 7,219,000 12,873,000 2,236,266
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(a) Xxxx will get $458K in quasi-note payments, but only $308K deducted from
Park note as Century will get $K @ exercise
(b) present value of bonus pool of $490K per schedule, paid at 12/17/99
(c) Xxxxxxxx and Xxxxxxx get options in Century for the number of shares shown
Advest Investment Banking Amitek/Century Merger CONFIDENTIAL
Consideration - Without Centennial Buyback
Centennial Not Bought Back
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Century common and pref o/s now 10,687,174 10,687,174
Centennial repurchase 0 0
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common outstanding 10,687,174 10,687,174
Century options o/s now 1,105,500
Century warrants o/s now 127,397
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equivalent common o/s 1,232,897
Park #shares = P = 16.9%[P + 10,687,174 + .8*(1,232,897)] 2,374,031
Century additional warrants
Centennial 0 at 6.00
Fidelity 60,000 at 6.00
Xxxxxxx 0 at 80% IPO
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Park at 16.9% 60,000 10,140
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2,384,171
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rounded to whole shares 2,384,171
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less options to Xxxx and Xxxxx (147,905)
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Outstanding shares to Amitek shareholders 2,236,266
Existing shares 10,687,174
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total outstanding 12,923,440 17.30% amitek %
Options and warrants overhang
1,232,897
60,000
147,905
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1,440,802 1,440,802
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fully diluted 14,364,242 15.57% amitek %
Advest Investment Banking Amitek/Century Merger CONFIDENTIAL
Consideration - With Centennial Buyback
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Cash Note Sub Total Shares-C-
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Consideration 6,475,000 8,525,000 15,000,000 2,275,453
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AAA Distribution 0 N/A N/A
LOMBARDO(a) 350,000 308,000 658,000 113,773
XXXXXXX 0 198,000 198,000 34,132
WINANS 0 400,000 400,000
XXXXXXX 0 400,000 400,000
BONUS POOL(b) 471,000 0 471,000
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SUBTOTAL 821,000 1,306,000 2,127,000 147,905
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Bal to Amitek Sh 5,654,000 7,219,000 12,873,000 2,127,548
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KWON 19.66% 1,111,853 1,419,609 2,531,463 418,380
THE PARKS 4,542,147 5,799,391 10,341,537 1,709,168
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5,654,000 7,219,000 12,873,000 2,127,548
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(a) Xxxx will get $458K in quasi-note payments, but only $308K deducted from
Park note as Century will get $ @ exercise
(b) present value of bonus pool of $490K per schedule, paid at 12/17/99
(c) Xxxxxxxx and Xxxxxxx get options in Century for the number of shares shown
Advest Investment Banking Amitek/Century Merger CONFIDENTIAL
Consideration - With Centennial Buyback
Centennial Bought Back
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Century common and pref o/s now 10,687,174 10,687,174
Centennial repurchase (666,667) (666,667)
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common outstanding 10,020,507 10,020,507
Century options o/s now 1,105,500
Century warrants o/s now 127,397
------------
equivalent common o/s 1,232,897
Park #shares = P = 16.9%[P + 10,020,507 + .8*(1,232,897)] 2,238,452
Century additional warrants
Centennial 100,000 at 6.00
Fidelity 60,000 at 6.00
Xxxxxxx 200,000 at 80% IPO
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Park at negotiated amount 360,000 37,001
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2,275,453
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rounded to whole shares 2,275,453
------------
less options to Xxxx and Xxxxx (147,905)
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Outstanding shares to Amitek shareholders 2,127,548
Existing shares 10,020,507
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total outstanding 12,148,055 17.51% amitek %
Options and warrants overhang
1,232,897
360,000
147,904
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1,740,801 1,740,801
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fully diluted 13,888,856 15.32% amitek %
EXHIBIT C
ESTIMATED CLOSING DATE BALANCE SHEET
AMITEK CORPORATION
ESTIMATED CLOSING BALANCE SHEET
JULY 28, 1999
(000)
ASSETS
CURRENT ASSETS
Cash $50
Accounts Receivable 11,600
Less Allowance (64)
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Net Accounts Receivable 11,536
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Receivable From Affiliate
Inventories 10,687
Note Receivable
Loans and Advances From Affiliates
Prepaid Expenses
Other Assets 41
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Total Current Assets 22,494
PROPERTY AND EQUIPMENT
Furniture and Fixtures 343
Manufacturing Equipment 5,341
Leasehold Improvements 197
Office Equipment 519
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Subtotal 6,400
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Less Accumulated Depreciation (1,750)
Total Property and Equipment 4,650
OTHER ASSETS
Goodwill
Misc. Receivables 0
Refundable Deposits 0
Other 655
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TOTAL ASSETS $27,799
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LIABILITIES & EQUITY
CURRENT LIABILITIES
Bank Line of Credit $12,500
Accounts Payable and Accrued Expenses 11,050
Account Payable to Affiliate
Current Portion of Lease Payable 800
Loan to Affiliate
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TOTAL CURRENT LIABILITIES 24,350
Lease Commitments Less Current Portion 1,249
Stockholder Loans Payable
Subordinated Liabilities
Stockholders' Equity
Commons Stock 1
Additional Paid In Capital 2,700
Accumulated Deficit (501)
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Total Equity 2,200
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TOTAL LIABILITIES AND EQUITY $27,799
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Amitek Corporation -3- July 30, 1999
Very truly yours,
CENTURY ELECTRONICS MANUFACTURING, INC.
By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President - Finance
Accepted and Agreed:
AMITEK CORPORATION
By: /s/ Xxxxx Xx Park
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Name: Xxxxx Xx Park
Title: President
THE PRINCIPAL SELLERS
/s/ Xxxxx Xx Park
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/s/ Xxxx Xxxx Park
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