Exhibit 10.5
Xxxxxx X. Xxxxx
0000 Xxxx Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
September 1, 1998
Xx. Xxxxxxx X. Xxxxxx
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxxxx, Xxxxxxxx 00000
Dear Xxxxx:
This letter serves to memorialize our Agreement concerning all common shares of
Xxxxx Technology Group, Inc., an Illinois business corporation (the "Company"),
held by you (the "Xxxxxx Shares") during the term of this Agreement. The term
of this Agreement shall commence on the date of your execution of this Agreement
and shall conclude on the earlier of the date immediately preceding the date the
Company undertakes an initial public offering and sale of common shares or the
date of the termination of your employment (the "Primary Term"). This Agreement
does not cover transfers of common shares for estate planning purposes, and in
the Primary Term, this Agreement does not cover the sale of common shares
pursuant to an initial public offering. If you are actively employed by the
Company at the end of the Primary Term of this Agreement, the term of this
agreement shall automatically, without any lapse, extend to conclude on the date
of the termination of your employment with the Company; provided however, that
if your employment is terminated due to death, permanent disability or
involuntary termination without cause, the terms of this Agreement shall extend
to the period during which you retain any of the Xxxxxx Shares. In such case,
this Agreement shall cover any shares sold by me in an initial public offering
and any shares sold by me in a secondary public offering, provided this
Agreement has not otherwise terminated.
If during the term of this Agreement I choose to sell to an outside party any of
the common shares of the Company held by me, you shall have the option to sell
to such purchaser (or an affiliate or assignee of such purchaser) such Xxxxxx
Shares of an equal proportion (the "Xxxxxx Tag Proportion") for the same price
per share and under the same terms as the common shares I choose to sell. In
addition to the foregoing, during the Primary Term and any extension thereof
pursuant to the preceding Paragraph hereof, you shall be entitled to participate
on the same terms that I participate in any registration of shares in the
Company pro rata to the extent that I participate with respect to my shares, to
the extent permitted by law or by the managing underwriter with respect to such
sale.
You shall receive written notice of my choice to sell my shares (including the
identity of the purchaser, number of shares to be purchased, the proposed
purchase price per share, and terms), and you shall have four (4) business days
within which to provide a written commitment to sell the Xxxxxx Tag Proportion.
Your failure to execute and deliver such
September 1, 1998
Xx. Xxxxxxx X. Xxxxxx
Page Two
written commitment shall be deemed a waiver of your option as it pertains to
that particular proposed transaction. In the event you waive or are deemed to
waive such option, I will have the right to sell the number of common shares
which would have been the aggregate of the shares I initially proposed to sell,
plus the Xxxxxx Tag Proportion had you committed to exercise your option, for
the same price and under the same terms as initially proposed. A waiver as to a
proposed transaction, other than as set forth hereinabove, shall not be deemed
to be a waiver of any subsequently proposed transaction.
A Simplified Example: Assume I hold 90,000 shares, and you hold 10,000 shares.
If I choose to sell fifteen percent (15%) of my shares [equal to 13,500 shares]
for two dollars per share ($2.00/share) cash at closing in a private placement,
you shall have four (4) business days within which to execute a written
commitment to exercise your option to sell the Xxxxxx Tag Proportion [fifteen
percent (15%), equal to 1,500 shares] to such purchaser for two dollars per
share ($2.00/share), cash at closing. If you do not provide the written
commitment, you waive the option as to that particular transaction, and I have
the right to sell a total of 15,000 of my shares in the transaction, for the
same price and under the same terms.
Notwithstanding the foregoing, this Agreement does not cover shares sold by me
on the open market, i.e. shares sold on a recognized stock exchange or network,
such as NASDAQ, NYSE, etc.
If this letter accurately reflects our Agreement, please execute and date both
originals of this letter and return one to me.
Sincerely,
/s/ Xxxxxx X. Xxxxx
XXXXXX X. XXXXX
AGREED:
/s/ Xxxxxxx X. Xxxxxx
_______________________________
XXXXXXX X. XXXXXX
Executed: February 17, 1999
