Exhibit 10.12
March 22, 1999
Xx. Xxxxxx X. Xxxxxx
00 Xxxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Dear Xxxxxx:
Reference is made to the Agreement, dated December 29, 1998 (the
"Agreement"), among GP Strategies Corporation (the "Company"), Xxxxxx X. Xxxxxxx
("Xxxxxxx") and Xxxxxx X. Xxxxxx ("Xxxxxx"). All capitalized terms shall have
the meanings set forth in the Agreement.
The Company, Xxxxxxx and Xxxxxx hereby agree as follows:
1. All references to "cashless" exercise in the Agreement are
hereby amended to mean a transaction whereby Xxxxxx shall pay
the exercise price of the options being exercised by
delivering to the Company shares of Common Stock (the
"Delivered Shares") (all such shares having been held by
Xxxxxx for at least six months) with a market value (based on
the Average Closing Price on the Cashless Exercise Date) equal
to the exercise price of the options being exercised and shall
receive the number of shares of Common Stock of the Company
with a market value equal to the sum of (i) the Spread and
(ii) the market value of the Delivered Shares.
2. In the event that the Company commences the process of
preparing a registration statement for a public offering of
its shares (the "Offering") on or prior to April 15, 1999,
which shall be evidenced by an "organizational" meeting (the
"Organizational Meeting") of the working group of lawyers,
accountants, investment bankers and others involved in the
proposed transaction, as well as other customary actions,
then:
a. Within ten business days after the Organizational Meeting,
Xxxxxx shall deliver a written notice to the Company
indicating the number of shares of Common Stock (including
shares of Common Stock issuable upon exercise of options) that
he desires to have included in the Offering, which number
shall be not less than 100,000 shares and not more than 20% of
the number of shares to be sold by the Company in the
Offering. Subject to paragraphs 2b, 2d and 2e, the Company
shall include in the Offering such number of shares of Common
Stock owned by Xxxxxx;
b. In the event that the managing underwriter or underwriters
advise the Company in writing that it is impracticable to
include all shares of Common Stock in the Offering, then any
reduction in the number of shares shall be on pro rata basis
between the Company and Xxxxxx, based on the number of shares
requested to be so included in the Offering by the Company and
Xxxxxx;
x. Xxxxxx shall be entitled to all customary piggy-back
registration rights with respect to the Offering including,
without limitation, receipt of written opinions, comfort
letters and indemnification rights;
x. Xxxxxx shall furnish such customary information and enter into
such customary agreements, including customary "lock-up"
agreements, in connection with the Offering as the Company or
the managing underwriter or underwriters may reasonably
request;
e. The Company shall consummate the Offering on or after July 5,
1999, provided that in the event that the staff of the
Securities and Exchange Commission (the "SEC") chooses not to
review the registration statement and the Company and the
managing underwriter or underwriters jointly determine that
the Offering shall be consummated on or prior to June 15,
1999, then none of Xxxxxx'x shares shall be included in the
Offering and Xxxxxx shall have the right to sell to the
Company (the "Put Right"), and the Company shall have the
right to purchase from Xxxxxx (the "Call Right"), on the terms
and conditions set forth below, the number of shares of Common
Stock that Xxxxxx had requested to be included in the Offering
(as provided in Section 2a hereof), subject to any reduction
as provided in Section 2b hereof, at a price per share equal
to the public offering price in the Offering less
underwriter's fees and commissions, provided that the Call
Right may not be exercised by the -------- Company unless the
price per share in the public offering is equal to at least
$15 per share; and
f. During the period of ten business days commencing on the date
the Offering is consummated (the "Offering Consummation
Date"), the Company may exercise the Call Right by written
notice to Xxxxxx, or Xxxxxx may exercise the Put Right by
written notice to the Company, provided that no such exercise
shall take -------- place in violation of applicable law. On
the business day after the day the Put Right or Call Right is
exercised, Xxxxxx shall deliver to the Company original stock
certificates representing the number of shares of Common Stock
subject to the Put Right or Call Right, as the case may be,
and stock powers with respect thereto, and the Company shall
deliver to Xxxxxx the purchase price for such shares in
immediately available funds.
3. In the event that (i) the Company does not hold an
Organizational Meeting to commence the process of preparing a
registration statement prior to April 15, 1999, or (ii) the
Offering Consummation Date is not prior to July 31, 1999, then
the Company shall file with SEC a registration statement on
Form S-3 on or prior to April 16, 1999 (or, August 15, 1999,
in the case of clause (ii)) relating to the resale of 100,000
shares of Common Stock owned by Xxxxxx. At the request of
Xxxxxx, at any time on or after September 1, 1999, the Company
shall also file with the SEC up to two additional registration
statements on Form S-3 relating to shares of Common Stock
owned by Xxxxxx. The Company shall use its reasonable best
efforts to have each such registration statement declared
effective as promptly as practicable after filing and to
maintain the effectiveness of such registration statement
until the earlier of the disposition by Xxxxxx of the Xxxxxx
Shares registered thereunder or the date on which Xxxxxx is
eligible to sell any Xxxxxx Shares registered thereunder still
held by him pursuant to Rule 144(k) under the Securities Act
(or any successor rule). The Company shall pay all expenses of
each such registration statement; provided, that Xxxxxx shall
be responsible for any brokerage or underwriting fees or
commissions and any counsel or -------- advisors representing
him. Xxxxxx will give the Company notice at least five
business days prior to any sale of Xxxxxx Shares and will sell
all Xxxxxx Shares in an orderly manner so as to minimize any
disruption of the trading market caused by such sales. This
provision shall replace Section 11 of the Agreement, which is
hereby deleted in its entirety.
4. The Company represents and warrants that (a) this letter
agreement and the transactions contemplated hereby have been
approved by all necessary corporate action and that the Put
Right and the Call Right have been approved by its Board of
Directors, and (b) the execution, delivery and performance of
this letter agreement by the Company will not violate, result
in a breach of, conflict with, or (with or without the giving
of notice of the passage of time or both) entitle any party to
terminate or call a default under, any agreement to which the
Company is a party. In addition, the Company represents and
warrants that the termination of Xxxxxx'x employment with the
Company will not accelerate the expiration date, result in a
termination or otherwise affect any of his options so long as
Xxxxxx remains a consultant with the Company.
5. At any time and from time to time, each party agrees, without
further consideration, to take such actions and to execute and
deliver such documents as the other parties may reasonably
request to effectuate the purposes of this letter agreement.
6. Except as specifically amended hereby, the Agreement shall
remain in full force and effect as originally executed. This
letter agreement may be modified only by a written instrument
duly executed by the party to be charged.
7. Any waiver by any party of a breach of any provision of this
letter agreement shall not operate as or be construed to be a
waiver of any other breach of such provision or of any breach
of any other provision of this letter agreement. The failure
of a party to insist upon strict adherence to any term of this
letter agreement on one or more occasions shall not be
considered a waiver or deprive that party of the right
thereafter to insist upon strict adherence to that term or any
other term of this letter agreement. Any waiver must be in
writing. Xxxxxx hereby waives any and all breaches by the
Company of Section 11 of the Agreement.
8. The provisions of this letter agreement shall be binding upon
and inure to the benefit of the parties hereto and the
successors and assigns of the Company and the respective
assigns, heirs, and personal representatives of the individual
parties hereto.
9. If any provision of this letter agreement is invalid, or
unenforceable, the balance of this letter agreement shall
remain in effect, and if any provision is inapplicable to any
person or circumstance, it shall nevertheless remain
applicable to all other persons and circumstances.
10. The Company will promptly reimburse Xxxxxx for his reasonable
legal fees and expenses incurred in connection with this
letter agreement, as well as reasonable legal fees and
expenses in connection with the Offering, provided that Xxxxxx
shall be obligated to pay all broker or underwriters fees and
commissions in connection with shares sold by him in the
Offering.
11. This letter agreement does not create, and shall not be
construed as creating, any rights enforceable by any person
not a party to this letter agreement (except as provided in
Section 9).
If you are in agreement with the foregoing, please deliver a copy of
this letter to the undersigned, whereupon this letter shall become a
binding agreement between us.
Sincerely,
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Xxxxxx X. Xxxxxxx
GP STRATEGIES CORPORATION
By:____________________________
The foregoing is hereby Agreed to as of the date hereof:
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Xxxxxx X. Xxxxxx
