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Exhibit 10.5(d)
AMENDMENT NO. 1
TO
CONSULTING AGREEMENT
THIS AMENDMENT NO. 1 is made and entered into as of February 24, 2000, by
and between I.T. Technology, Inc., a Delaware corporation (the "Company") and
Xxxxxx Xxxxxxx, an individual ("Consultant") (the "Amendment") to the Consulting
Agreement dated as of June 18, 1999 between the Company and Consultant (the
"Agreement") .
NOW, THEREFORE, in consideration of the mutual promises contained herein
the parties hereto to amend the Agreement as follows:
1. Definitions. Unless otherwise defined in this Agreement, all capitalized
terms used in this Agreement shall have the meanings set forth in the Agreement.
2. Paragraph 3(b) of the Agreement is hereby deleted in its entirety and
shall be of no further force of effect in lieu thereof is replaced with the
following:
" (b) In addition to the foregoing issuance of shares of common stock
of the Company, in the event that the Company's current interest in
Xxxxxxxxxx.Xxx, Inc. ("Stampville") of 50.1% is not reduced to less than
27.5% pursuant to the Company's agreement with Stampville as a result of
its failure to invest at least $2,750,000 in Stampville and further so long
as: (i) thereafter the Company owns no less than 10% of the outstanding
common stock of Stampville and (ii) Consultant remains as a consultant to
or employee of the Company or Stampville, Consultant shall receive from the
Company:
(i) the "Consultant's Percentage", as hereinafter defined, of the
aggregate amount of "Dividends", as hereinafter defined, paid or
distributed to the shareholders of Stampville during any fiscal year
(the "Consultant Profit Share");
(ii) the Consultant Profit Share shall only be payable to the
Consultant in the event the Stampville makes a payment in cash or
property (but not in stock of Stampville) to its shareholders in
general as a dividend or distribution (the "Dividend"); in which case
the Consultant Profit Share due for such year will be payable at the
same time and in the same manner as the Dividend;
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(iii) in the event no Dividend is paid to Stampville's
shareholders during any year, Consultant's rights to any Consultant
Profit Share for that year shall be null and void and shall not be
added to or aggregated with any Consultant Profit Share paid in a
subsequent year;
(iv) in the event Consultant's employment with or consulting for
the Company and Stampville terminates during any fiscal year, for any
reason (the "Termination"), Consultant shall only be entitled to a
Consultant Profit Share Payable thereafter during such fiscal year
equal to the product of the full Consultant Profit Share for the
period during such fiscal year for which the Dividend is payable (the
"Dividend Period") multiplied by a fraction the numerator of which is
the number of days during such Dividend Period prior to the
Termination and the denominator of which is the full number of days in
the Dividend Period;
(v) in addition to the Consultant Profit Share, Consultant shall
be entitled to receive from the Company the "Consultant's Pro-Rata
Share", as hereinafter defined, of the proceeds actually received by
the Stampville shareholders from a "Sale Transaction", as hereinafter
defined. For the purposes hereof the "Consultant's Pro-Rata Share"
shall be equal to the product of the total consideration distributed
to the holders of common stock of Stampville in connection with such
Sale Transaction multiplied by the product of the "Consultant's
Percentage", as hereinafter defined, multiplied by a fraction the
numerator of which is equal to the number of shares of Stampville
common stock outstanding as of the date hereof or 100,000 shares and
the denominator of which is equal to the number of shares of
Stampville common stock outstanding immediately preceding the
consummation of the Sale Transaction (excluding any shares that have
been issued or retired as a result of stock splits or reverse stock
splits);
(vi) in the event of a Sale transaction where the shareholders of
Stampville receive consideration other than cash, Consultant shall
receive, at the Company's discretion, either such consideration or its
value in cash;
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(vii) for the purposes hereof a "Sale Transaction" shall be
defined as a transaction or a series of related transactions pursuant
to which: (aa) all or substantially all of the outstanding capital
stock of Stampville is sold; or (bb) Stampville's merger with or into
a another entity the result of which is that the holders of
Stampville's outstanding capital stock immediately prior to the
consummation of the transaction(s) do not own a majority of the
capital stock in the surviving entity immediately following the
transaction. Notwithstanding anything to the contrary contained
elsewhere herein, no transaction shall be considered a Sale
Transaction unless the definitive agreement with respect to such
transaction is entered into during the term of Consultant's engagement
as a consultant to or employee of the Company or Stampville or solely
in the case of Consultant's involuntary termination without cause,
within thirty (30) days after such termination;
(viii) for the purposes of hereof, the Consultant's Percentage
shall initially be one percent (1%)(the "Initial Percentage");
provided however, in the event Consultant has received of any prior
payments of Consultant's Pro- Rata Share, the Consultant's Percentage
shall, prior to any subsequent payment of a Consultant's Pro-Rata
Share, be adjusted to reflect such payments, so that the Consultant's
Percentage then in effect shall be equal to the product of the Initial
Percentage multiplied by a fraction the numerator of which is the
percentage of the Company's ownership of the Common Stock of
Stampville immediately prior to the last Sale Transaction and the
denominator of which is 50.1% (excluding the effects of prior stock
splits, stock dividends, reverse stock splits and like transactions) ;
and
(vi) for the purposes of hereof, the determination by the Company
of the Consultant Profit Share or the Consultant's Pro-Rata Share
shall be final and binding on the Consultant. In addition, nothing
contained herein shall require Stampville to declare of pay a Dividend
during any year in which a Consultant Profit Share would thereupon
become due; the determination as to whether or not Stampville shall
declare or pay a Dividend shall remain within the sole discretion of
Stampville's Board of Directors.
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3. Paragraph 3(c) of the Agreement is hereby deleted to add at the end of
the first line thereof the following:
" on compensation due under Paragraph 3(a)."
4. Survival of Provisions. Except as specifically provided in this
Amendment, all of the terms and conditions contained in the Agreement shall
remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date and at the place first above written.
I.T. TECHNOLOGY, INC.
By: /s/ XXXXX XXXXXX
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Its: President
/s/ XXXXXX XXXXXXX
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Xxxxxx Xxxxxxx
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