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EXHIBIT 2.1
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF MERGER
This First Amendment (the "Amendment"), dated September 4, 2001 to
Agreement and Plan of Merger dated as of May 7, 2001 (the "Agreement"), is by
and among Industrial Holdings, Inc., a Texas corporation ("IHI"), T-3 Energy
Services, Inc., a Delaware corporation ("T-3"), and First Reserve Fund VIII,
Limited Partnership, a Delaware limited partnership (the "Fund").
WHEREAS, IHI, T-3 and the Fund desire to amend the Agreement as
provided herein.
NOW, THEREFORE, in consideration of the covenants and agreements herein
contained, the parties hereto agree as follows:
1. The definition of "Exchange Factor" contained in Section 1.1 of the
Agreement is deleted and replaced as follows:
"Exchange Factor" means 90.846.
2. The following definitions contained in Section 1.1 of the Agreement
are deleted: (i) "Discretionary Equity Investment," (ii) "Joint Proxy
Statement/Prospectus," (iii) "Net Proceeds," (iv) "Registration Statement," (v)
"Sale of Stock," (vi) "Sale of Assets" and "SJMB Conversion Amount." Each
reference in the Agreement to each of the foregoing terms is hereby deleted.
3. The following definitions are added to Section 1.1 of the Agreement:
"Merger Warrant" means a warrant to purchase one share of common
stock of the Surviving Corporation for $1.28 in substantially the form attached
hereto as "Exhibit G."
"Joint Proxy Statement" shall have the meaning ascribed to it in
Section 6.3 hereof.
"Reincorporated Corporation" means the surviving corporation in the
Reincorporation.
"Reincorporation Merger Agreement" means the Agreement and Plan of
Merger attached to this Agreement as Appendix I.
4. The definition of Material Adverse Effect contained in Section 1.1
of the Agreement is deleted and replaced with the following:
"Material Adverse Effect" means with respect to a Person, any fact,
circumstance, event or condition that has or would be reasonably likely to have,
with the passage of time, a material adverse effect on the business, operations,
assets or financial condition of such Person and its
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Subsidiaries, taken as a whole, or on such Person's ability to carry out the
transactions contemplated hereby; including, but not limited to, with respect to
IHI, the environmental condition described in Exhibit F being a material cause
of IHI's inability to obtain the Financing. Notwithstanding the foregoing,
"Material Adverse Effects" shall not include changes affecting the United States
economy or the energy industry generally in which such person operates.
5. All references in the Agreement to "Joint Proxy
Statement/Prospectus" are replaced with "Joint Proxy Statement".
6. Appendix I to the Agreement is deleted and replaced with the
Reincorporation Merger Agreement set forth in Exhibit A hereto.
7. Appendix II to the Agreement is deleted and replaced with the
Restated Articles set forth in Exhibit B to this Amendment.
8. The Registration Rights Agreement set forth in Exhibit C to this
Amendment is added as Appendix IV to the Agreement.
9. The letter set forth in Exhibit F to this Amendment is added as
Exhibit F to the Agreement.
10. The form of Merger Warrant attached to this Amendment as Exhibit G
is added as Exhibit G to the Agreement.
11. Subsections 2.3(g) is deleted and replaced with the following:
(g) From and after the Effective Time, the members of the
committees of the Board of Directors of the Surviving Corporation shall be as
set forth below:
Audit Committee
Xxxxxx X. Xxxxxxx (Chairman)
Xxxxx X.. Xxxxxxx
Xxxxxx X. Xxxxxx
Compensation Committee
Xxx X. Xxxxx (Chairman)
Xxxxxx X. Xxxxxxx
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12. Subsection 2.3(h) of the Agreement is deleted and replaced with the
following:
(h) From and after the Effective Time, the officers of the
Surviving Corporation shall be as set forth below:
Title Name
----- ----
President and Chief Executive Officer Xxxxxxx X. Xxxxxxxxxx
Chief Financial Officer, Treasurer and Secretary Xxxxxxx X. Xxxx
Assistant Secretary Xxxxx X. Xxxx
All other officers of the Surviving Corporation shall
be as elected by the Board of Directors form time to time
following the Effective Time in accordance with the Restated
Bylaws. From and after the Effective Time, the officers of the
Surviving Corporation shall hold office subject to the
provisions of the Restated Bylaws and Applicable Law.
13. 3.1(b) of the Agreement is deleted and replaced with the following:
(b) At the Effective Time, each share of T-3 Common Stock issued
and outstanding immediately prior to the Effective Time (other than shares held
by a holder that properly exercises dissenters' rights in strict compliance with
the DGCL), without any action on the part of the holder thereof, shall
automatically become and be converted into (i) the right to receive certificates
evidencing a number of shares of IHI Common Stock equal to the Exchange Factor
plus (ii) 1.803 Merger Warrants, upon surrender, in accordance with Subsection
3.1(c) hereof, of certificates theretofore evidencing shares of T-3 Common
Stock. Section 3.1 of the T-3 Disclosure Schedule lists all T-3 Stockholders and
the number of shares of T-3 Common Stock owned by each such stockholder as of
the date hereof (including shares issuable upon conversion of debt held by the
Fund).
14. Section 6.3 of the Agreement is deleted and replaced with the
following:
Section 6.3 Joint Proxy Statement. As promptly as reasonably
practicable after the date hereof, IHI will prepare and file with the SEC in
accordance with the Exchange Act, a joint proxy statement (the "Joint Proxy
Statement"), relating to approval and adoption of this Agreement and the
transactions contemplated hereby by the stockholders of IHI and T-3. The parties
will take such actions as may be reasonably required to cause the Joint Proxy
Statement to be cleared by the SEC for mailing to the IHI stockholders as
promptly as practicable after such filing and to cause the shares of IHI Common
Stock issuable in connection with the Merger to be exempt from registration
under applicable federal and state securities laws. Each of the parties hereto
shall furnish all information concerning itself which is required or customary
for inclusion in the Joint Proxy Statement. As soon as reasonably practicable
after the Joint Proxy Statement has been cleared by the SEC, IHI and T-3 shall
promptly mail the Joint Proxy Statement to each of their respective
stockholders.
15. Section 6.4 of the Agreement is deleted and replaced with the
following:
Section 6.4 Registration Rights. Upon the Closing, IHI and each of
the former T-3 stockholders will enter into a registration rights agreement (the
"Registration Rights Agreement") in the form attached hereto as Appendix IV.
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16. Section 6.5 of the Agreement is deleted and replaced with the
following:
Section 6.5 Equity Investment in T-3. Immediately prior to the
closing of the Merger, the parties agree that the Fund shall make an additional
equity investment in the amount of $46,800,000 to acquire additional shares of
T-3 Common Stock at a price per share of $116.28 (the "Equity Investment").
17. Subsection 6.6(a) of the Agreement is deleted and replaced with the
following:
(a) Prior to the Closing, IHI shall use its commercially reasonable
efforts to obtain a new credit facility, which shall be in a form reasonably
satisfactory to T-3 and the Fund, containing usual and customary covenants, and
on terms that are mutually agreed upon by IHI and T-3, in a principal amount
(the "Financing") equal to the greater of (i) $80 million, and (ii) an amount
that together with the Equity Investment, will produce proceeds sufficient to
repay or refinance the IHI Senior Secured Credit Facility and the EnSerCo Loan.
18. Section 6.17 of the Agreement is hereby deleted and replaced with
the following:
Section 6.17 Nasdaq Application. IHI shall apply for initial
listing of the common stock of the Reincorporated Corporation on the Nasdaq
National Market and IHI shall remit the fees required to be paid in connection
therewith. IHI and T-3 shall use their commercially reasonable efforts to obtain
approval for the initial listing of the common stock of the Reincorporated
Corporation on the Nasdaq National Market.
19. Section 6.19 of the Agreement is deleted and replaced with the
following:
Section 6.19 Agreements with Respect to IHI Dispositions.
(a) IHI has entered into letters of intent (the "Letters of
Intent") with respect to the IHI Dispositions dated July 2, 2001 and August 6,
2001.
(b) The parties agree that definitive agreements (the
"Disposition Agreements") with the purchasers described in the Letters of Intent
must be entered into between IHI and/or its Affiliates not later than the
mailing date of the Joint Proxy Statement, or October 31, 2001, whichever occurs
first.
(c) The Disposition Agreements may take the form of a merger,
sale of stock or sale of assets or such other form as may be reasonably
acceptable to T-3 and IHI. No Disposition Agreement shall be entered into
without the written consent of T-3, which consent shall not be unreasonably
withheld; however, T-3 shall have no obligation to consent unless the
Disposition Agreements reflect the terms of the Letters of Intent (as such terms
have been amended as disclosed to T-3), in all material respects (including the
consideration to be paid thereunder). IHI agrees to keep T-3 informed regarding
the status of all negotiations relating to the IHI Dispositions and allow T-3 to
participate (with such legal or other advisors as it deems appropriate), at its
expense, in discussions and negotiations with the proposed purchasers.
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Notwithstanding the foregoing, IHI shall remain solely responsible for the IHI
Dispositions, and T-3 shall have no authority to negotiate such transactions or
enter into any agreements on IHI's behalf.
(d) Each IHI Disposition shall include the assumption by the
purchaser of the liabilities of the subject company, substantially as provided
in the relevant Letter of Intent. All proceeds from the IHI Dispositions shall
be used (i) first to repay any capitalized leases that are owed by the entity
being sold, or borrowed money indebtedness secured by the assets of the entity
being sold in the order of priority of their secured position and (ii) second to
repay a portion of IHI's Senior Secured Credit Facility satisfactory to IHI
senior secured lenders.
20. Subsection 7.1(b) of the Agreement is deleted and replaced with the
following:
(b) The IHI Stockholders shall have met and approved this
Agreement, including the plan of merger for the Merger, and the Reincorporation
Merger Agreement.
21. Subsection 7.1(f) of the Agreement is deleted and replaced with the
following:
(f) The IHI Dispositions shall have been completed in accordance
with Section 6.19 hereof.
22. Item 5 in Exhibit E to the Agreement (Opinion of LeBoeuf, Lamb,
Xxxxxx & XxxXxx, L.L.P.) is deleted.
23. The following subsection is added at the end of Section 7.1 of the
Agreement:
(g) The shares of common stock of the Reincorporated Corporation
shall have been approved for quotation on the Nasdaq National Market.
24. The following subsection is hereby added to the end of Section 7.2
of the Agreement:
(e) there shall have occurred no Material Adverse Effect with
respect to T-3 since the date of this Agreement.
25. The following subsection is hereby added to the end of Section 7.3
of the Agreement:
(g) there shall have occurred no Material Adverse Effect with
respect to IHI since the date of this Agreement.
26. IHI hereby consents to: (1) the Stock Option Agreement dated June
17, 2001 between T-3 and Xxxxxxx X. Xxxxxxxxxx, (ii) the Stock Option Agreement
dated June 17, 2001, between T-3 and Xxxxxxx X. Xxxx and (iii) the employment
agreement dated July 31, 2001,
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between Control Products of Louisiana, Inc., a wholly owned Subsidiary of T-3,
and Xxxxxx X. Xxxxxxx.
27. Capitalized terms used but not defined herein shall have the
meanings set forth in the Agreement.
28. Except as otherwise amended hereby, the Agreement remains in full
force and effect.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
signed by their respective duly authorized officers as of the date first written
above.
INDUSTRIAL HOLDINGS, INC.
By: /s/ XXXXXX X. XXXX
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Xxxxxx X. Xxxx
President and Chief Executive Officer
T-3 ENERGY SERVICES, INC.
By: /s/ XXXXXXX X. XXXXXXXXXX
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Xxxxxxx X. Xxxxxxxxxx
President and CEO
FIRST RESERVE FUND VIII,
LIMITED PARTNERSHIP
By: First Reserve GP VIII, L.P.,
its General Partner
By: First Reserve Corporation,
its General Partner
By: /s/ XXXXXX X. XXXXXXX
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Xxxxxx X. Xxxxxxx
Vice President
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