EXHIBIT 2.2
EXECUTION COPY
FIRST AMENDMENT TO THE AGREEMENT AND PLAN OF MERGER
This First Amendment (this "Amendment"), dated as of March 17, 1999 to
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the certain Agreement and Plan of Merger (the "Merger Agreement") dated as of
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January 29, 1999 by and among Muzak Holdings LLC (f/k/a ACN Holdings, LLC)
("Parent"), Audio Communications Network, LLC ("Sub"), Muzak Limited Partnership
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("MLP"), MLP Acquisition, L.P. ("MLP Acquisition") and Music Holdings Corp.
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("MHC," and together with MLP Acquisition, the "GP Entities").
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WHEREAS, Parent, Sub, MLP and the GP Entities (collectively, the "Parties")
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desire to amend the Merger Agreement on the terms and conditions set forth
herein.
NOW THEREFORE, in consideration of the mutual agreements set forth herein,
the Parties agree as follows:
1. Capitalized Terms. Capitalized terms used herein without definition
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shall have the meanings ascribed to such terms in the Merger Agreement.
2. Additional Consideration. Section 2.1(b) of the Merger Agreement is
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hereby amended in its entirety to read as follows:
"(b) Conversion of the Units. Each Unit outstanding immediately prior
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to the Effective Time shall be converted into the right to receive a
portion of the Merger Consideration (as defined in Section 2.3(a) below) as
provided herein, except that, notwithstanding anything contained herein to
the contrary, any Units owned by Sub as of immediately prior to the
Effective Time shall be extinguished and Sub shall have no right to receive
any portion of the Merger Consideration with respect to its ownership of
such Units."
3. Merger Consideration. The last sentence of Section 2.3(a) of the
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Merger Agreement is hereby amended in its entirety to read as follows:
"For purposes of this Section 2.3(a), the "Specified Percentage" shall
equal 3.964326%."
4. Enterprise Value. Section 2.3(f)(ii) of the Merger Agreement is
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hereby amended in its entirety to read as follows:
"(ii) "Enterprise Value means $234,245,115."
5. Tax Matters. Section 6.7(c) of the Merger Agreement is hereby amended
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in its entirety to read as follows:
"(c) Parent, the Surviving Entity, MLP and the GP Entities agree to
treat the Merger, for all federal, state and local income tax purposes, as
(i) a transfer by MLP of all of its assets (subject to its liabilities) to
the Surviving Entity in exchange for the Payment Fund (exclusive of the LLC
Units) and the Escrow Funds followed by (ii) the liquidation of MLP;
provided that with respect to any Units owned by Sub as of immediately
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prior to the Effective Time, the Surviving Entity will be treated as
acquiring a proportionate interest in the assets of MLP (subject to the
liabilities of MLP) in liquidation of the partnership interest in MLP held
by Sub, pursuant to Code Sections 731(b) and 732(b)."
6. Sound of Music Payment Obligation. In connection with the calculation
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of Funded Indebtedness, the parties hereto have included $3,570,000 for MLP's
obligation to make payments to Xxxxxxx X. Xxxxxxx, Xxxxxxx X. Xxxxxxx and Xxxx
Xxxxxxx (collectively, the "Cushings") pursuant to that certain Non-Competition
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Agreement, executed in 1998, among MLP and the Cushings (such obligation, the
"Sound of Music Payment Obligation"). If within 90 days after the date hereof,
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MHC delivers to Parent a written agreement, executed by each of the Cushings,
pursuant to which the Cushings agree that in exchange for the payment to the
Cushings of an amount less than $3,570,000 (such amount, the "Sound of Music
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Pay-off Amount") the Sound of Music Payment Obligation shall be terminated and
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satisfied in full, then the Surviving Entity shall deliver to MHC, on behalf of
the holders of Units as of immediately prior to the Effective Time, a cash
payment in an amount equal to $3,570,000 minus the Sound of Music Pay-off
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Amount. Parent hereby represents and warrants to MHC that any such payment to
MHC is not prohibited by any credit agreement or indenture which Parent or
Surviving Entity are or will be a party.
7. Governing Law. This Amendment shall be governed by, and construed in
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accordance with, the laws of the State of Delaware, regardless of the laws that
might otherwise govern under the applicable principles of conflicts of laws
thereof.
8. Counterparts. This Amendment may be executed in any number of
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counterparts, each of which shall be deemed an original, but all of which
together shall constitute a single instrument.
9. Agreement. In all other respects the Merger Agreement is ratified
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and shall, as so changed by these amendments, continue in full force and effect.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first set forth above.
MUZAK HOLDINGS LLC
By:/s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
Title: Executive Vice President
AUDIO COMMUNICATIONS NETWORK, LLC
By:/s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
Title: Executive Vice President
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[SIGNATURE PAGE TO FIRST AMENDMENT TO THE AGREEMENT AND PLAN OF MERGER]
MUZAK LIMITED PARTNERSHIP
By: MUZAK ACQUISITION, L.P.
Managing General Partner
By: MUSIC HOLDINGS CORP.
its General Partner
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
Title: Vice President and Assistant Secretary
MLP ACQUISITION, L.P.
By: MUSIC HOLDINGS CORP.
its General Partner
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
Title: Vice President and Assistant Secretary
MUSIC HOLDINGS CORP.
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
Title: Vice President and Assistant Secretary
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