EXHIBIT 10.2
AMENDMENT NO. 1 TO STOCK PURCHASE AGREEMENT
THIS AMENDMENT NO. 1 (this "Amendment") to the Stock Purchase Agreement
dated as of May 3, 2006 (the "Purchase Agreement"), by and between Rapid
Link, Incorporated, a Delaware corporation (the "Buyer"), and Apex
Acquisitions, Inc., a Delaware corporation (the "Stockholder") in its
capacity as the sole stockholder of Telenational Communications Inc., a
Delaware corporation (the "Company"), is made and entered into as of May 5,
2006 by and among the Buyer and the Stockholder. Capitalized terms used and
not otherwise defined in this Amendment shall have the meanings ascribed to
them in the Purchase Agreement.
RECITALS
A. Section 2.2(i) of the Purchase Agreement provides that the Initial
Cash Payment shall be paid by wire transfer of immediately available funds.
B. Buyer and the Stockholder have agreed to amend the Purchase
Agreement to provide for the payment of the Initial Cash Payment by a
promissory note in the aggregate principal amount of $1,000,000.
C. In consideration for this amendment, Buyer and Stockholder have
agreed to amend the Purchase Agreement to provide for the determination
and payment of the Contingent Stock Payment following the First Performance
Period.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:
AGREEMENT
1. Amendment.
1.1 Section 1.1 of the Purchase Agreement is hereby amended to delete,
in its entirety, the definition of "Second Performance Period."
1.2 Section 2.2(i) of the Purchase Agreement is hereby amended and
restated in its entirety as follows:
"(i) a promissory note in the aggregate principal amount of
$1,000,000 (the "Note"), the form of which is attached hereto as Exhibit
2.2(i), which shall be issued in accordance with the provisions set forth
in Section 2.4(a) below (the "Initial Note Payment");"
1.3 Section 2.3(c) of the Purchase Agreement is hereby amended and
restated in its entirety as follows:
"(c) Contingent Stock Payment Adjustment. Within 45 days after the
expiration of the First Performance Period, Buyer's independent accountant
shall determine the Company's aggregate Monthly Gross Profit for the First
Performance Period (the "First Aggregate Monthly Gross Profit"). In the
event that the Company's First Aggregate Monthly Gross Profit is less than
$900,000 (the "Target Aggregate Monthly Gross Profit"), then the Contingent
Stock Payment shall be reduced by a number of shares to be determined as
follows:
(i) the product obtained by multiplying $750,000 by a fraction
whose numerator is the Target Aggregate Monthly Gross Profit less the
First Aggregate Monthly Gross Profit and whose denominator is the
Target Aggregate Monthly Gross Profit;
(ii) divided by the volume weighted average closing price per
share of Buyer Common Stock as reported on the Over-the-Counter
Bulletin Board (or any other securities exchange or inter-dealer
quotation system on which the Buyer Common Stock is then listed) for
the 15 consecutive trading days ending on the day prior to the first
anniversary of the Closing Date (the "Per Share Price"); provided,
however, that such Per Share Price shall be not less than $0.13 per
share and not greater than $0.25 per share."
1.4 Section 2.4(a) of the Purchase Agreement is hereby amended and
restated in its entirety as follows:
"(a) Initial Note Payment. On the Closing Date, upon surrender to
Buyer of certificates representing all and not less than all of the Company
Shares, Buyer shall issue to the Stockholder the Note. The Note shall be
secured by all of the Company Shares as provided in that certain Stock
Pledge Agreement by and between Buyer and the Stockholder, the form of
which is attached hereto as Exhibit 2.4(a) (the "Pledge Agreement")."
1.5 Section 2.4(d) of the Purchase Agreement is hereby amended and
restated in its entirety as follows:
"(a) Contingent Stock Payment. In respect of the First Performance
Period, within five Business Days after the delivery of the Final
Computation of the First Aggregate Monthly Gross Profit, Buyer shall deliver
to the Stockholder certificates representing the Contingent Stock Payment,
as adjusted pursuant to Section 2.3(c) above."
1.6 Section 6.11 of the Purchase Agreement is hereby amended and
restated in its entirety as follows:
"Section 6.11 Employment and Non-Compete Agreements. Within 30 days
of the Closing Date, Buyer shall enter into an employment and non-compete
agreement with each of Christopher Canfield and Michael Prachar (the
"Telenational Executives"), in form and substance reasonably acceptable to
the Telenational Executives, and which agreements shall have substantially
the same material terms and conditions (exclusive of terms relating to
levels of compensation, including the amount of base salary, potential
bonuses, benefits and other perquisites, which may vary from one executive
to another) as Buyer's employment agreements with its key executive
officers."
1.7 Section 8.2(e) of the Purchase Agreement is hereby deleted in its
entirety and replaced with the following:
"(e) reserved"
1.8 Section 8.4 of the Purchase Agreement is hereby amended and
restated in its entirety as follows:
"Section 8.4 Deliveries by Buyer at Closing. Concurrently
herewith, Buyer has delivered or shall cause to be delivered the
following:
(a) The Note;
(b) The Pledge Agreement; and
(c) Such documents and instruments as may be necessary or
appropriate to carry out the transactions contemplated by this
Agreement."
2. Miscellaneous.
2.1 Enforceability of Purchase Agreement. Except as specifically
amended hereby, all of the terms of the Purchase Agreement shall remain and
continue in full force and effect and are hereby confirmed in all respects.
2.2 Authority; Severability. Each party hereto warrants that the
person signing below is authorized to sign this Amendment on its behalf and
to bind it to the terms of this Amendment. Should any provision of this
Amendment be held by a court of competent jurisdiction to be invalid or
illegal, such invalidity or illegality shall not invalidate the whole of
this Amendment, but rather this Amendment shall be construed as if it did
not contain the invalid or illegal part, and the rights and obligations of
the parties shall be construed and enforced accordingly.
2.3 Entire Agreement. This Amendment, together with the Purchase
Agreement, sets forth the entire agreement and understanding among
the parties as to the subject matter hereof and supersedes all prior
discussions, agreements and understandings of any and every nature among
them.
2.4 Governing Law. This Amendment shall be governed by and construed
in accordance with the internal laws of the State of Delaware, without
regard to the choice of law provisions thereof.
2.5 Counterparts. This Amendment may be executed in counterparts and
the signature pages may be combined to create a document binding on all of
the parties hereto.
IN WITNESS WHEREOF, Buyer and the Stockholder have caused their duly
authorized representatives to execute this Amendment No. 1 to Stock Purchase
Agreement as of the date first written above.
STOCKHOLDER:
Apex Acquisitions, Inc.,
a Delaware corporation
By:
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Christopher Canfield, Chief Executive Officer
BUYER:
Rapid Link, Incorporated,
a Delaware corporation
By:
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John Jenkins, Chief Executive Officer