FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT (this "Agreement"), is
made and entered into as of August 3, 1998, by and among: (i) FlashNet
Communications, Inc., a Texas corporation (the "Company"); (ii) Apogee Fund
LP, a Delaware limited partnership ("Apogee"); (iii) Xxxxxx X. Xxxxxx
("Xxxxxx"); (iv) ISP Investors, L.P., a Texas limited partnership ("ISP");
(v) Xxxxx X. Xxxxxxx ("Kleberg"); (vi) J. Xxxxxx Xxxx, Xx. ("Xxxx"); (vii)
Xxxx X. Xxxxxxxx ("Xxxxxxxx"); (viii) Fourteen Hill Capital, LP, a Delaware
limited partnership ("FHC"); (ix) Applied Telecommunications Technologies,
Inc., a Delaware corporation ("ATTI"); (x) Xxxx Xxxxxx ("Xxxxxx"); (xi) UD
Xxxxx Xxxxxxx XXX ("Xxxxxxx"); (xii) Xxxxx Xxxxxxx ("Xxxxxxx"); (xiii)
Xxxxxxx Xxxxxx ("Squali"); (xiv) Xxxxxxx X. Xxxxxx ("Xxxxxx"); (xv) Xxxxxx X.
Xxxxxxx Insurance Trust, U/A 6/28/91, Xxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxxx and
Xxxxxxx X. Xxxxxxx, Trustees ("Xxxxxxx Trust"); (xvi) Xxxxx X. Xxxxxxx
("Xxxxxxx"); (xvii) Xxxxx X. Xxxxxxxx ("Klepetko"); and (xviii) Q Ventures,
L.P., a Texas limited partnership ("Q Ventures").
W I T N E S S E T H:
WHEREAS, the Company, Apogee, Xxxxxx, ISP, Kleberg, King, Xxxxxxxx and
FHC (Apogee, Xxxxxx, ISP, Kleberg, King, Xxxxxxxx and FHC being collectively
referred to hereinafter as the "First Round Buyers") entered into that
certain Stock Purchase Agreement, dated as of May 7, 1998 (the "Purchase
Agreement"), pursuant to which the First Round Buyers purchased an aggregate
of 749,587 shares (the "First Round Shares") of the Series A Convertible
Preferred Stock, $1.00 par value per share, of the Company ("Series A
Preferred"); and
WHEREAS, subject to the terms and conditions hereof, simultaneously with
the execution of this Agreement, pursuant to the Purchase Agreement and this
Agreement, the Company wishes to issue and sell to ATTI, Castro, FHC, ISP,
Manning, Griffin, Squali, Wilkes, Xxxxxxx Trust, Jenkins, Klepetko, Kleberg,
King, Xxxxxxxx and Q Ventures (the "Second Round Buyers"), and the Second
Round Buyers desire to purchase from the Company, an aggregate of 614,498
shares (the "Second Round Shares") of the Series A Preferred;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereby agree as follows:
SECTION 1
PURCHASE AND SALE OF SECOND ROUND SHARES
AND AMENDMENT TO PURCHASE AGREEMENT
1.01 PURCHASE AND SALE OF SECOND ROUND SHARES. The Company hereby
agrees to issue, sell and deliver to each of the Second Round Buyers, and
each of the Second Round Buyers hereby agrees to purchase and accept from the
Company, the number of shares of the Series A Preferred as set forth beside
the name of each of the Second Round Buyers on Schedule 1.01 of this
Agreement. In consideration for the Second Round Shares, the Second Round
Buyers shall simultaneously with execution hereof pay to the Company by wire
transfer to an account designated by the Company or by personal check an
aggregate purchase price of $3,730,000, the portion of such aggregate
purchase
price paid by each Second Round Buyer being as set forth beside its name on
Schedule 1.01. The Company shall issue and deliver to the Second Round
Buyers stock certificates in definitive form registered in the name of the
Second Round Buyers evidencing the Second Round Shares.
1.02 AMENDMENTS TO PURCHASE AGREEMENT.
(a) The Purchase Agreement is hereby amended such that the
defined terms "Buyer" and "Buyers" in the Purchase Agreement shall in all
cases include the Second Round Buyers, and the Second Round Buyers, by their
execution of this Agreement, shall: (i) be deemed to have executed and
delivered the Purchase Agreement; (ii) be deemed to have made, as of the date
hereof, the representations and warranties set forth in Article IV of the
Purchase Agreement; and (iii) have all the rights, benefits and obligations
of the Purchase Agreement as if they were original signatories thereof.
(b) The Purchase Agreement is hereby amended such that the
defined term "Shares" in the Purchase Agreement shall in all cases include
the Second Round Shares.
(c) The Purchase Agreement is hereby amended by adding the
following information to Schedule 3.8 thereof:
FlashNet Telecom, Inc.
0000 Xxxxx Xxxxxx Xxxx Xxxx.
Xxxx Xxxxx, Xxxxx 00000
Incorporated in the State of Texas
Shares authorized: 100,000
Shares issued
and outstanding: 100,000
Ownership: All shares issued and outstanding are owned by
FlashNet Communications, Inc.
(d) Section 3.9 of the Purchase Agreement is hereby amended by
changing the percentage figure appearing in such section from 23.8% to 36.24%.
(e) The Purchase Agreement is hereby amended by deleting
Schedules 3.26 and 3.29 thereof in their entirety and substituting in their
place new Schedules 3.26 and 3.29 to this Agreement.
(f) Section 3.39 of the Purchase Agreement is hereby amended by
adding the following language immediately following the date appearing in the
second line thereof:
"...AND TO XXXXXXX GLOBAL SECURITIES, INC. PURSUANT TO AN ENGAGEMENT
LETTER DATED JULY 10, 1998"
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FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT PAGE 2
SECTION 2
WAIVER AND CONSENT OF FIRST ROUND BUYERS
2.01 WAIVER. Section 4 (b) of the Certificate of Designations of the
Series A Preferred (the "Certificate of Designations") provides the First
Round Buyers with certain preemptive rights in respect of offers of equity
securities by the Company. Each of the undersigned First Round Buyers hereby
waives any and all preemptive rights or other similar rights such holder may
have under Section 4(b) of the Certificate of Designations or otherwise in
respect of the Company's issuance and sale of the Second Round Shares.
2.02 CONSENT. Section 9(c) of the Certificate of Designations
prohibits the Company, without the affirmative vote or consent of the holders
of a majority of the shares of the Series A Preferred, from taking certain
actions, including amendment of the Articles of Incorporation, which is
necessary in order for the Company to issue the Second Round Shares. Each of
the undersigned First Round Buyers hereby consents to all corporate action
required to be taken by the Corporation in order for the Corporation to
issue, sell and deliver the Second Round Shares as set forth in this
Agreement.
SECTION 3
MISCELLANEOUS
3.01 SURVIVAL OF AGREEMENTS. All agreements made herein shall survive
the execution and delivery of this Agreement and the issuance, sale and
delivery of the Second Round Shares, and all statements contained in any
certificate or other instrument delivered by the Company pursuant to the
Purchase Agreement shall be deemed to constitute representations and
warranties made, as of the date hereof, by the Company to the Second Round
Buyers and to the First Round Buyers.
3.02 SUCCESSORS AND ASSIGNS. All covenants and agreements contained in
this Agreement by or on behalf of the parties hereto shall bind and inure to
the benefit of the respective successors and assigns of the parties hereto
whether so expressed or not.
3.03 NOTICES. All notices, requests, consents and other communications
under the Purchase Agreement to the Second Round Buyers shall be addressed as
follows:
Applied Telecommunications Technologies, Inc.
00 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxx Xxxxxxxx
Telefax: (000) 000-0000
Xxxx Xxxxxx
0000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Telefax: (000) 000-0000
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FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT PAGE 3
Fourteen Hill Capital, LP
0000 Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx Rodskog
Telefax: (000) 000-0000
ISP Investors, L.P.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Attn: Xxxx Xxxxxxxxxx
Telefax: (000) 000-0000
UD Xxxxx Xxxxxxx XXX
000 Xxxx 00xx Xxxxxx, Xxx. 0X
Xxx Xxxx, Xxx Xxxx 00000
Telefax: (000) 000-0000
Xxxxx Xxxxxxx
000 Xxx Xxxxx Xxxxxx
Xxxxxx, Xxx Xxxxxx 00000
Telefax: (000) 000-0000
Xxxxxxx Xxxxxx
000 Xxxxxxx Xxxxx, Xxx. 0X
Xxxxxxxx, Xxx Xxxx 00000
Telefax: (000) 000-0000
Xxxxxxx X. Xxxxxx
00 Xxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Telefax: (000) 000-0000
Xxxxxx X. Xxxxxxx Insurance Trust
U/A 6/28/91, Xxxxx X. Xxxxxxx, Xxxxxx X.
Xxxxxxx and Xxxxxxx X. Xxxxxxx, Trustees
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
Telefax: (000) 000-0000
Xxxxx X. Xxxxxxx
00 Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telefax: (000) 000-0000
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FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT PAGE 4
Xxxxx X. Xxxxxxxx
00 Xxxxxx Xxxx
Xxxxxxxxxx, Xxx Xxxx 00000
Telefax: (000) 000-0000
Xxxxx X. Xxxxxxx
000 Xxxxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Telefax: (000) 000-0000
J. Xxxxxx Xxxx, Xx.
301 Commerce, Suite 1600
Xxxx Xxxxx, Xxxxx 00000
Telefax: (000) 000-0000
Xxxx X. Xxxxxxxx
000 Xxxxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Telefax: (000) 000-0000
Q Ventures, L.P.
000 Xxxxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Telefax: (000) 000-0000
3.04 LAW GOVERNING. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas.
3.05 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
of the parties with respect to the subject matter hereof and may not be
modified or amended except in accordance with Section 8.15 of the Purchase
Agreement.
3.06 NO OTHER AMENDMENTS. Except as expressly amended hereby, the
Purchase Agreement shall continue in full force and effect in accordance with
the terms and provisions thereof.
3.07 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.
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FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT PAGE 5
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
THE COMPANY:
FLASHNET COMMUNICATIONS, INC.
By: /s/ M. Xxxxx Xxxxxx
----------------------------------
M. Xxxxx Xxxxxx
President
FIRST ROUND BUYERS:
APOGEE FUND LP
By: Paradigm Capital
---------------------------------,
its General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxx
----------------------------
Title: President
----------------------------
/s/ Xxxxxx X. Xxxxxx
---------------------------------------
Xxxxxx X. Xxxxxx
ISP Investors, L.P.
By: Xxxxxxxxxx Capital Partners, LLC,
its General Partner
By: /s/ Xxxx Xxxxxxxxxx
----------------------------
Name:
----------------------------
Title:
----------------------------
/s/ Xxxxx X. Xxxxxxx
---------------------------------------
Xxxxx X. Xxxxxxx
/s/ Xxxxxx Xxxx
---------------------------------------
J. Xxxxxx Xxxx, Xx.
/s/ Xxxx X. Xxxxxxxx
---------------------------------------
Xxxx X. Xxxxxxxx
FOURTEEN HILL CAPITAL, LP
By: Fourteen Hill Management, LLC,
its General Partner
By: Point West Capital Corporation,
its General Partner
By: /s/ Xxxxx X. Rodskog
----------------------------
Name: Xxxxx X. Rodskog
----------------------------
Title: Senior VP
----------------------------
SECOND ROUND BUYERS:
APPLIED TELECOMMUNICATIONS
TECHNOLOGIES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
----------------------------------
Title: President
---------------------------------
/s/ Xxxx X. Xxxxxx
---------------------------------------
Xxxx Xxxxxx
FOURTEEN HILL CAPITAL, LP
By: Fourteen Hill Management, LLC,
its General Partner
By: Point West Capital Corporation,
its General Partner
By: /s/ Xxxxx X. Rodskog
---------------------------------
Name: Xxxxx X. Rodskog
---------------------------------
Title: Senior V.P.
---------------------------------
ISP INVESTORS, L.P.
By: Xxxxxxxxxx Capital Partners, LLC,
its General Partner
By: /s/ Xxxx Xxxxxxxxxx
----------------------------
Name:
----------------------------
Title:
----------------------------
UD XXXXX XXXXXXX XXX
By: /s/ Xxxxx Xxxxxxx
-----------------------------
Xxxxx (Xxxxxxx) Xxxxxx
/s/ Xxxxx Xxxxxxx
----------------------------------
Xxxxx Xxxxxxx
/s/ Xxxxxxx Xxxxxx
----------------------------------
Xxxxxxx Xxxxxx
/s/ Xxxxxxx X. Xxxxxx
----------------------------------
Xxxxxxx X. Xxxxxx
XXXXXX X. XXXXXXX INSURANCE TRUST, U/A
6/28/91
By: /s/ Xxxxx X. Xxxxxxx, Trustee
-----------------------------
Xxxxx X. Xxxxxxx, Trustee
/s/ Xxxxx X. Xxxxxxx
----------------------------------
Xxxxx X. Xxxxxxx
/s/ Xxxxx X. Xxxxxxxx
----------------------------------
Xxxxx X. Xxxxxxxx
/s/ Xxxxx X. Xxxxxxx
----------------------------------
Xxxxx X. Xxxxxxx
/s/ Xxxxxx Xxxx
----------------------------------
J. Xxxxxx Xxxx, Xx.
/s/ Xxxx X. Xxxxxxxx
----------------------------------
Xxxx X. Xxxxxxxx
Q VENTURES, L.P.
By: Acme Widget, L.P.,
its General Partner
By: Scepter Holdings, Inc.,
its General Partner
By: /s/ Xxxxxx XxXxxxxxx
----------------------------
Name: Xxxxxx XxXxxxxxx
----------------------------
Title: Vice President
----------------------------
