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First Amendment To Agreement And Plan Of Merger

Agreement and Plan of Merger

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 This Agreement and Plan of Merger involves

COMMUNICATIONS SALES LEASING, INC. | Communications Sales Leasing, Inc, CSL Fiber Holdings LLC, Thor Merger Sub Inc, Tower Cloud, Inc | Shareholder Representative Services LLC

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Title: FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER
Governing Law: Delaware     Date: 8/11/2016
Industry: Real Estate Operations     Sector: Services

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Exhibit 2.2

 

EXECUTION COPY

 

FIRST AMENDMENT TO

AGREEMENT AND PLAN OF MERGER

 

This is the First Amendment (the “ First Amendment ”) to that certain Agreement and Plan of Merger dated as of June 20, 2016 (the “ Merger Agreement ”) by and among Communications Sales & Leasing, Inc., CSL Fiber Holdings LLC, Thor Merger Sub Inc., Tower Cloud, Inc., and Shareholder Representative Services LLC, in its capacity as the Equityholders’ Representative.  The effective date of this First Amendment is August 11, 2016.  Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Merger Agreement.

 

WHEREAS, the Merger Agreement was executed by the parties hereto on June 20, 2016;

 

WHEREAS, pursuant to Section 12.02(a) of the Merger Agreement, the Merger Agreement may be amended in a writing signed by Parent, Purchaser, the Company (or the Surviving Corporation following the Closing) and the Equityholders’ Representative; and

 

WHEREAS, pursuant to Section 2.07(f) of the Merger Agreement, the parties to the Merger Agreement agreed to implement a plan to permit the holders of Out-of-the-Money Company Stock Options to participate in any Per Share Adjustment Consideration, Per Share Escrow Release Amount, Per Share Equityholders’ Representative Fund Release Amount, and Per Share Earn-Out Payments to the extent the Out-of-the-Money Company Stock Options held by such Equityholders would have been In-the-Money Company Stock Options if such amounts and all prior Per Share Closing Cash Consideration, Per Share Adjustment Consideration, Per Share Escrow Release Amounts, Per Share Equityholders’ Representative Fund Release Amounts and Per Share Earn-Out Payments had been included in the Merger Consideration paid on the Closing Date.

 

NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree to amend the Merger Agreement as follows:

 

 

1.

Section 1.01 of the Merger Agreement is hereby amended by adding the following defined term immediately following the definition of “Covered Tax”:

 

Cumulative Merger Consideration Per Common Share ” means, at any point in time, the cumulative amount of Common Merger Consideration previously paid in respect of each share of Company Common Stock issued and outstanding immediately prior to the Effective Time.

 

 

2.

The definition of “Fully Diluted Common Number” set forth in Section 1.01 of the Merger Agreement is hereby amended and restated in its entirety as follows:

 

Fully Diluted Common Number ” means, with respect to any payment of any portion of Common Merger Consideration to be paid hereunder:

 

(i) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is less than or equal to $0.09, the total number of shares of Company Stock (including Dissenting Shares, but excluding Disregarded Shares) outstanding immediately prior to the Effective Time (assuming all shares of Company Preferred Stock are converted into Company Common Stock as of such time);

 

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EXECUTION COPY

(ii) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.09 but less than or equal to $0.11, the sum of (A) the total number of shares of Company Stock (including Dissenting Shares, but excluding Disregarded Shares) outstanding immediately prior to the Effective Time (assuming all shares of Company Preferred Stock are converted into Company Common Stock as of such time) and (B) the total number of shares of Company Common Stock issuable upon the exercise in full of all Company Stock Options (whether or not vested) with an exercise price of $0.09 or less and outstanding immediately prior to the Effective Time;

 

(iii) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.11 but less than or equal to $0.13, the sum of (A) the total number of shares of Company Stock (including Dissenting Shares, but excluding Disregarded Shares) outstanding immediately prior to the Effective Time (assuming all shares of Company Preferred Stock are converted into Company Common Stock as of such time) and (B) the total number of shares of Company Common Stock issuable upon the exercise in full of all Company Stock Options (whether or not vested) with an exercise price of $0.11 or less and outstanding immediately prior to the Effective Time;

 

(iv) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.13 but less than or equal to $0.24, the sum of (A) the total number of shares of Company Stock (including Dissenting Shares, but excluding Disregarded Shares) outstanding immediately prior to the Effective Time (assuming all shares of Company Preferred Stock are converted into Company Common Stock as of such time) and (B) the total number of shares of Company Common Stock issuable upon the exercise in full of all Company Stock Options (whether or not vested) with an exercise price of $0.13 or less and outstanding immediately prior to the Effective Time;

 

(v) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.24 but less than or equal to $0.41, the sum of (A) the total number of shares of Company Stock (including Dissenting Shares, but excluding Disregarded Shares) outstanding immediately prior to the Effective Time (assuming all shares of Company Preferred Stock are converted into Company Common Stock as of such time) and (B) the total number of shares of Company Common Stock issuable upon the exercise in full of all Company Stock Options (whether or not vested) with an exercise price of $0.24 or less and outstanding immediately prior to the Effective Time; and

 

(vi) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.41, the sum of (A) the total number of shares of Company Stock (including Dissenting Shares, but excluding Disregarded Shares) outstanding immediately prior to the Effective Time (assuming all shares of Company Preferred Stock are converted into Company Common Stock as of such time) and (B) the total number of shares of Company Common Stock issuable upon the exercise in full of all Company Stock Options (whether or not vested) with an exercise price of $0.41 or less and outstanding immediately prior to the Effective Time.

 

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For illustrative purposes only, a sample application of the Fully Diluted Common Number definition to a series of hypothetical Common Merger Consideration payments is attached hereto as Schedule IA .

 

 

3.

The definition of “Pro Rata Share” set forth in Section 1.01 of the Merger Agreement is hereby amended and restated in its entirety as follows:

 

Pro Rata Share ” means, with respect to an Equityholder’s entitlement to receive any portion of the Common Merger Consideration to be paid hereunder,

 

(i) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is less than or equal to $0.09, a fraction (expressed as a percentage) (A) the numerator of which is the total number of shares of Company Common Stock held by such Equityholder (on an as-converted basis with respect to any shares of Company Preferred Stock held by such Equityholder) immediately prior to the Effective Time, and (B) the denominator of which is the Fully Diluted Common Number;

 

(ii) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.09 but less than or equal to $0.11, a fraction (expressed as a percentage) (A) the numerator of which is the sum of (1) the total number of shares of Company Common Stock held by such Equityholder (on an as-converted basis with respect to any shares of Company Preferred Stock held by such Equityholder) immediately prior to the Effective Time and (2) the total number of shares of Company Common Stock issuable upon the exercise in full of all Company Stock Options (whether or not vested) with an exercise price of $0.09 or less and held by such Equityholder immediately prior to the Effective Time, and (B) the denominator of which is the Fully Diluted Common Number;

 

(iii) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.11 but less than or equal to $0.13, a fraction (expressed as a percentage) (A) the numerator of which is the sum of (1) the total number of shares of Company Common Stock held by such Equityholder (on an as-converted basis with respect to any shares of Company Preferred Stock held by such Equityholder) immediately prior to the Effective Time and (2) the total number of shares of Company Common Stock issuable upon the exercise in full of all Company Stock Options (whether or not vested) with an exercise price of $0.11 or less and held by such Equityholder immediately prior to the Effective Time, and (B) the denominator of which is the Fully Diluted Common Number;  

 

(iv) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.13 but less than or equal to $0.24, a fraction (expressed as a percentage) (A) the numerator of which is the sum of (1) total number of shares of Company Common Stock held by such Equityholder (on an as-converted basis with respect to any shares of Company Preferred Stock held by such Equityholder) immediately prior to the Effective Time and (2) the total number of shares of Company Common Stock issuable upon the exercise in full of all Company Stock Options (whether or not vested) with an exercise price of $0.13 or less and held by such Equityholder immediately prior to the Effective Time, and (B) the denominator of which is the Fully Diluted Common Number;

 

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EXECUTION COPY

(v) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.24 but less than or equal to $0.41, a fraction (expressed as a percentage) (A) the numerator of which is the sum of (1) the total number of shares of Company Common Stock held by such Equityholder (on an as-converted basis with respect to any shares of Company Preferred Stock held by such Equityholder) immediately prior to the Effective Time and (2) the total number of shares of Company Common Stock issuable upon the exercise in full of all Company Stock Options (whether or not vested) with an exercise price of $0.24 or less and held by such Equityholder immediately prior to the Effective Time, and (B) the denominator of which is the Fully Diluted Common Number; and

 

(vi) to the extent that such payment of Common Merger Consideration would result in a Cumulative Merger Consideration Per Common Share that is greater than $0.41, a fraction (expressed as a percentage) (A) the numerator of which is the sum of (1) the total number of shares of Company Common Stock held by such Equityholder (on


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