Stock Purchase Agreement [Amendment] - RIGL Corp., Telco Billing Inc., Morris & Miller Ltd., and Mathew & Markson Ltd.
AMENDMENT TO THE STOCK PURCHASE AGREEMENT.
The amendment to Stock Purchase Agreement ("Amendment") is made and entered
into on the16th day of March, 1999, by and among RIGL Corporation, a Nevada
corporation ("RIGL"), Telco Billing, Inc. a Nevada corporation ("TBI") Morris
& Miller, Ltd and Mathew & Markson, Ltd. (collectively "Shareholders").
RECITALS
A. On or about march 16, 1999, a certain Stock Purchase Agreement
(Agreement") was executed by the parties above named, which said Agreement is
still in full force and effect as TBI and the Shareholders have elected not to
declare a default, but the parties hereto acknowledge that RIGL is in
substantial and material default pursuant to the terms and conditions of said
Agreement in that RIGL has not complied with the provisions of paragraph 1.3.1
of said Agreement.
B. RIGL has requested that the time for performance pursuant to
paragraph 1.3.1 of said agreement shall be extended in the manner hereinafter
set forth.
C. TBI and the shareholders have agreed to extend the time for
performance under paragraphs 1.3.1 of said Agreement subject to and in
conformance with the provisions of this Amendment, and not otherwise, but only
upon the condition that RIGL shall pay to Mathew & Markson, one of the
Shareholders, an "Extension Fee" in the sum of $2,000,000 as hereinafter
provided, none of which shall be refundable.
D. Except for the revisions, amendments and additions effected by
this Amendment, the said Agreement shall be deemed to be in full force and
effect according to its terms, as amended.
Now therefore in consideration of the mutual promises of parties' and
other valuable consideration, it is agreed as follows:
1. Recitals. Each and all of the Recitals is hereby represented by
the parties hereto to be true and accurate as of the date hereof, and said
Recitals are hereby incorporated fully into this Amendment.
2. Extension Fee. RIGL is hereby granted an extension of time, up to
but not past 5:00 p.m. on the 16th day of July, 1999, ("Extension Date") in
which to pay the Royalty Balance of $5,000,000.00 provided for in said
Agreement subject to the following:
a) Concurrently with the execution of this Agreement, RIGL shall pay to
Mathew & Markson in cash, cashier's check drawn on a Phoenix, Arizona bank, or
by wire transfer to Mathew & Markson pursuant to wiring instructions, the sum
of one million dollars ($1,000,000.00) as and for an Extension Fee which
extends to RIGL the right to defer payment of the Royalty Balance as provided
for herein;
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b) The receipt of payment of the Extension Fee by Mathew & Markson shall
be deemed to cure RIGL's default of paragraph 1.3.1 of the Agreement, and
shall extend the time for RIGL to pay the Royalty Balance of $5,000,000 prior
to the expiration of the Extension Date.
C) Upon the receipt of the Extension Fee by Mathew & Markson, the parties
agree that paragraph 1.3.1 of the Agreement is hereby deleted in full, and in
lieu thereof, the following paragraphs 1.31 through and including 1.3.8 shall
be substituted for paragraph 1.3.1 of said Agreement:
1.3.1. On or before 5:00 p.m. on June 16, 1999, RIGL shall have the option to
pay directly to Mathew & Markson at such address as Mathew & Markson shall
designate in writing, in cash, cashier's check drawn on a Phoenix, Arizona
bank, or by wire transfer pursuant to written instructions, the remaining
$3,000,000.00 of the Royalty Balance;
1.3.2. In Lieu of the payment provided for in paragraph 1.3.1, on or before
5:00 p.m. on June 16, 1999, RIGL shall have the option of paying to Mathew &
Markson the sum of $3,000,000.00 inclusive of the Extension Fee, along with a
Promissory Note (the "Note") in favor of Mathew & Markson in the original
principal amount of $2,000,000.00, with all outstanding principal due and
payable no later than 5:00 p.m. on July 15, 1999. The note shall be in a form
satisfactory to Mathew & Markson, and shall be secured by 2,000,000 shares of
the restricted common shares of RIGL Corporation. The terms of such security
arrangement shall be set forth in a Stock Pledge Agreement on terms and
conditions acceptable to Mathew & Markson. The share certificate representing
the 2,000,000 shares shall be validly issued, fully paid and non-accessible
and shall be accompanied by opinion of counsel for RIGL as to its authenticity
and shall be held in escrow by counsel for Mathew & Markson until such time as
the Note is fully satisfied or a default occurs under the terms of the Note
and or the Stock Pledge;
1.3.3. Upon the payment of either the entire $5,000,000.00 Royalty Balance
described in paragraph 1.3.1, or that $3,000,000 portion of the Royalty
Balance and delivery of the Note, Stock Pledge and Shares, TBI and
Shareholders shall close the transaction contemplated under the Agreement in
accordance with paragraph 1.6 therein;
1.3.4. In the event that RIGL shall fail or refuse to perform completely in
accordance with the separate provisions of paragraphs 1.3.1 or 1.3.2 of this
Amendment, then none of the Extension Fee shall be credited toward the Royalty
Balance, and RIGL shall be deemed to have substantially and materially
breached the said agreement as herein amended, and the Extension Fee shall be
deemed to have been earned by TBI and the Shareholders;
1.3.5. In the event that RIGL shall fully perform pursuant to paragraph
1.3.1, or in the alternative pursuant to paragraph 1.3.2, then and in either
of such events the Extension Fee shall be credited toward the payment of the
Royalty Balance of $5,000,000.00.
1.3.6. All references to time herein shall be determined to refer to Phoenix
local time;
1.3.7. It is the intension of the parties hereto that the Extension Fee shall
at no time be repaid to RIGL, but that said Extension Fee shall either be
retained by Mathew & Markson on behalf of TBI and the Shareholders as payment
for the Extension Fee, or, the Extension Fee shall be applied toward payment
of the Royalty Balance and retained by Mathew & Markson for that reason;
1.3.8. No Part of the Extension Fee paid by RIGL shall be derived from the
sale or hypothecation of any of the real, personal or intangible property of
TBI and/or its affiliates, it being the intent of the parties that only funds
at risk by RIGL and/or its affiliates will be used to pay the Extension Fee.
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3. Build out allowance. In the event RIGL elects to move forward
under paragraph 1.3.2, as additional consideration, RIGL agrees to provide
Simple.Net a build-out allowance of $250,000.00 to be used as Simple.Net deems
reasonable to build out, furnish and equip office space to be utilized by
Simple.Net located at 4840 E. Jasmine Street, Suite 111, Mesa, Arizona 85205.
This space is currently leased by RIGL pursuant to a lease dated July 1, 1998.
The initial terms of the Lease expires on June 30. 2003. Simple.Net shall
have the right to sublease such space from RIGL for the sum of $1.00 per year
for the remainder of the initial term, and RIGL warrants to comply with the
terms of the July 1, 1996 Lease and pay all rent in a timely manner.
4. Right of Offer. In the event RIGL elects to Move forward under,
and complies with the terms of paragraph 1.3.2, RIGL shall have the right to
receive notification from the principals of Simple.Net of their intention to
sell Simple.Net before Simple.Net is advertised for sale on the general
market. If Simple.Net receive and offer(s) to sel, RIGL shall receive
notification of such offer(s) and shall have the right to compete against such
offer(s) for the right to purchase Simple.Net upon such terms mutually
acceptable to the principals of Simple.Net and RIGL. Simple.Net shall have no
obligation to accept any such offer from RIGL.
This Amendment has been executed on the day and year first above written.
RIGL
RIGL CORPORATION, a Nevada corporation
By: ______________/S/_____________
WILLIAM O'NEAL
Its: Sr. Vice President
TBI
TELCO BILLING, INC., an Arizona corporation
By: _____________/S/_____________
JOSEPH CARLSON
Its: President
SHAREHOLDERS:
Morris & Miller, Ltd.
By: _____________/S/_____________
CATHERINE THOMAS
Its: Director
Mathew & Markson, Ltd.
By: _____________/S/_____________
ILSE COOPER
Its: Director
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EXHIBIT C
LICENSE AGREEMENT
_________________
This EXCLUSIVE LICENSING AGREEMENT ("License") is entered into on this 21st