AMENDMENT NO. 2 TO PLAN AND AGREEMENT OF MERGER
AMENDMENT NO. 2, made and entered into as of September 30, l996 (this
"Amendment"), to the PLAN AND AGREEMENT OF MEREST, dated as of April 29, 1996,
as amended by Amendment No. 1 made and entered into as of June 28, 1996, (as so
amended, the "Merger Agreement"), by and between J. MlCHAELS, INC., a New York
corporation (the "company"), and XXXXXX XXXXXXX CAPITAL MARKETS GROUP INC., a
Delaware corporation wholly-owned by Xxxxxx Xxxxxxx ("MSCMG").
W I T N E SS E TH:
WHEREAS, the Company and MSCMG have entered into the Merger Agreement; and
WHEREAS, the Company and MSCMG desire to amend the Merger Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. Termination. Section 10.1(d) of the Merger Agreement shall be amended by
(a) deleting the reference to "September.30, 1996" appearing in the third line
thereof and substituting in its place "January 6, 1997" and (b) inserting after
the word "herein" appearing in the fourth line thereof the following clause:
", provided, however, that if the Company has not yet implemented a
one-for-seven reverse stock split of its common stock (the "Reverse
Stock Split") on or prior to November 15, 1996, then, at the option of
the Company, the Effective Time of the Merger may be deferred until
either the third or sixth day of January, 1997"
2. Reverse Stock Split. The Company shall, immediately following execution
of this Amendment, take all actions necessary to allow it to amend its
certificate of incorporation to cause its Common Stock, par value $1.00 per
share, to be reverse split on a one-for-seven basis, including making such
filings with the Securities and Exchange Commission, The NASDAQ Stock Market and
the State of New York as may be required and mailing an information atatement to
its stockholders. In connection with such Reverse Stock Split, fractional shares
shall be rounded upwards to the next largest whole share. Such Reverse Stock
Split shall become effectixe immediately after the Effective Time of the Merger.
MSCMG shall indemnify the Company and its officers, directors, employees,
affiliates, successors or assigns (the "Indemnified Parties") for, and shall
hold the Indemnified Parties harmless from and against, and shall reimburse the
Indemnified Parties for, any and all damages, losses, liabilities, penalties or
expenses of any kind or of any nature whatatever incurred by the Indemnified
Parties in connection with the Reverse Stock Split.
3. Expenses. Section 12.1 of the Merger Agreement shall be amended by
inserting the following paragraph after the first paragraph thereof:
"Further, MSCMG shall pay all additional third party expenses (including,
but not limited to, reasonable attorneys' fees, accountants' fees and filing
fees and excluding expenses relating to the liquidation of the Company's assets
(including, but not limited to, salaries and all other costs relatlng to the
Company's employees)) of the Company incurred in connection with (i) the Reverse
stock Split and (ii) the continued affairs of the Company until the Effective
Time of the Merger which would not have been incurred had the Closing occurred
on September 20, 1996."
4. Legal Fees. Promptly following the execution of this Amendment, MSCMG
shall reimburse the Company in the amount of $5,000 for legal fees previous1y
paid by it in connection with the transactions contemplated by the Merger
Agreement. Further, MSCMG shall similarly pay all outstanding invoices for legal
fees for services rendered by Moses & Singer LLP, special counsel to the
Company, to the Company pursuant to the Merger Agreement.
5. Approval of this Amendment. All authorizations, approvals and consents
(including consents of the Boards of Directors) necessary for the execution and
delivery by the Company and MSCMG of this Amendment have been given or made.
6. Governing Law. This Amendment shall be construed and enforced in
accordance with and governed by the laws of the State of New York applicable to
contracts executed in and to be performed solely within such state.
7. Status of the Merger Agreement. All other terms and conditions of the
Merger Agreement shall remain in full force and effect, as amended hereby.
8. Miscellaneous. (a) Headings. All headings in this Amendment are for
convenience of reference only and are not intended to limit or affect the
meaning of any provision hereof.
(b) Counterparts. This Amendment may be executed in one or more
counterparts with the same effect as if the signatures to all such counterparts
were upon the same instrument, and all such counterparts shall constitute but
one instrument.
(c) Capitalized Terms. All capitalized terms used in this Amendment, unless
otherwise defined herein, shall have the same meaning as such terms have in the
Merger Agreement.
IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
by a duly authorized officer and to become effective as of the day and year
first above written.
X. XXXXXXXX, INC.
By: /S/ XXXXX X. XXXXXXXX
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Name: Xxxxx X. Xxxxxxxx
Title: President
XXXXXX XXXXXXX CAPITAL
MARKETS GROUP INC.
By: /S/ XXXXXX X. XXXXXXX
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Name: Xxxxxx X. XXXXXXX
Title: President
