AMENDMENT
TO
AGREEMENT AND PLAN OF
MERGER
This Amendment to Agreement and Plan of Merger
(this “Amendment”) is made as of November 30, 2006 by
and among CAPITAL GROWTH SYSTEMS, INC., a Florida corporation
(“Capital Growth”), GLOBAL CAPACITY MERGER SUB, INC., a
Texas corporation (“Global Capacity Mergeco”), GLOBAL
CAPACITY GROUP, INC., a Texas corporation (“Global
Capacity”), JOHN ABRAHAM (“Abraham”) and DAVID P.
WALSH (“Walsh”), (Abraham and Walsh are hereinafter
collectively referred to as the “Shareholders”), under
the following circumstances:
R E C I T A L
S
A.
The parties hereto entered into an
Agreement and Plan of Merger dated as of October 6, 2006 (the
“Merger Agreement”), pursuant to which Capital Growth
agreed to acquire Global Capacity as part of a reverse triangular
merger under which Global Capacity Mergeco will merge with and into
Global Capacity, with Global Capacity continuing as the surviving
corporation (the “Merger”).
B.
The parties entered into an
Extension Agreement dated as of October 12, 2006 (the
“Extension Agreement”), pursuant to which the parties,
among other things, agreed to extend the Closing Date to December
11, 2006 in exchange for a certain non-refundable, fully earned
extension payment, an increase to the Merger Consideration and the
Cash Consideration payable at Closing, an acknowledgment concerning
priority of the Global Capacity Merger transaction over other
transactions and certain other agreements as set forth
therein.
C.
On November 29, 2006, counsel for
Global Capacity sent Capital Growth a notice alleging certain
breaches under the Extension Agreement (the “Default
Notice”).
D.
The parties desire to amend the
Merger Agreement and the Extension Agreement, as set forth herein,
and to provide for withdrawal of the Default Notice effective upon
occurrence of both the (i) execution of this Amendment; and (ii)
the wire transfer of $200,000 to David Walsh and John Abraham, as
set forth herein.
NOW, THEREFORE, in consideration of the
foregoing and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties hereto do hereby agree as follows:
1.
Amendment to Merger Agreement and
Extension Agreement . The
Merger Agreement and the Extension Agreement shall be, and they
hereby are, amended as follows:
(A) The Cash Consideration payable at Closing shall
be, and it hereby is, increased to $5,200,000.
(B) Section 3 of the Extension Agreeme
