EXHIBIT 10.6
LOCK-UP LETTER AGREEMENT
AUGUST __, 1998
X.X. Xxxxxx & Company, L.L.C.
0000 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Xxxxx Xxxx and Shire Incorporated
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
I am the owner of _________ shares of Common Stock, no par value (the
"Common Stock") of Dectron Internationale, Inc., a corporation organized
under the laws of the province of Quebec, Canada (the "Company").
The Company intends to conduct an initial public offering of its Common
Stock ("IPO") which shall be underwritten by X.X. Xxxxxx & Company, LLC and
Xxxxx Xxxx and Shire Incorporated (the "Underwriters"), as expressed in a
letter of intent between the Company and the Underwriters (the "Letter of
Intent") dated June 25, 1998. The undersigned recognizes the benefits which
the Company will derive from the IPO. For and in consideration of the
Underwriters entering into the Letter of Intent and its willingness to
conduct the IPO contemplated thereby on mutually acceptable terms, I hereby
agree to the following lock-up arrangement restricting the sale of the
Company's Common Stock.
A. THE LOCK-UP
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1. The period during which the Company's Common Stock shall be subject
to the restrictions set forth herein shall commence on the date hereof and
terminate on the date which is eighteen (18) months from the closing of the
IPO, or on the date which is thirty six (36) months from the closing of the
IPO in the event my total compensation as an officer or director of the
Company is in excess of $100,000 per year, or if I own five percent (5%) or
more of the Company's outstanding stock (such period herein referred to as
the "Lock-Up Period"). During the Lock-Up Period, I will not sell, pledge,
hypothecate, grant an option for sale or otherwise dispose of, or transfer or
grant the General Rules and Regulations under the Securities Act of 1933, as
amended, or otherwise) any of the shares of Common Stock (directly or
indirectly owned or controlled by me on the date hereof) (the "Securities"),
without the Underwriters's prior written consent. During the Lock-Up Period,
securities may be sold or otherwise transferred in a private transaction so
long as the acquiror of the Securities, by written agreement with the
Underwriters entered into at the time of acquisition and delivered to the
Underwriters prior to the consummation of such acquisition, agrees to be
bound by the terms of this Paragraph
A.1 for the balance of the Lock-Up Period, and by the terms of Paragraph A.2
below; and, provided further, that the Securities, or any portion thereof,
may be transferred by any such transferee to a trust for the benefit of, or
as gifts to, either individually or collectively in any number, such
transferee, or his or her spouse and children, (a "Permitted Transferee") and
in such event the trustee of such trust or donor shall execute this Lock-Up
Letter Agreement and agree to be bound thereby; or (ii) by court order or
pursuant to the laws of descent and distribution.
2. In the event I desire to sell any of the Securities at any time
during the term of the Lock-Up Period or within 12 months after termination
of the Lock-Up Period as described below, publicly under Rule 144 or
otherwise, I will sell such securities through the Underwriters, so long as
the price and terms of execution offered by the Underwriters are at least as
favorable as may be obtained from other brokerage firms.
3. Following the expiration of the Lock-Up Period, the shares of Common
Stock subject to this Lock-Up Agreement shall be released from the
restrictions set forth in Paragraph A.1 at a rate of twenty percent (20%) per
annum for a period of five (5) years, except in the event of a bona-fide
tender offer made at above the prevailing market price. Once released, such
shares may be sold in accordance with the provisions of Paragraph A.2 above.
4. Notwithstanding anything herein to the contrary, all of the
Securities shall be released from the restrictions set forth in paragraph
A.1, to the extent not previously released, on _____________________.
B. PROVISIONS APPLICABLE TO SHARES
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The Company and the undersigned hereby acknowledge and represent that:
(a) A copy of this Lock-Up Agreement will be available from the
Company or its transfer agent upon request and without charge and a copy of
this Lock-Up Agreement may be filed with the Securities Commissions of
various states, including, without limitation, any state securities
commission requiring its availability.
(b) A typed legend will be placed on the reverse side of each stock
certificate representing the Common Stock covered by the Lock-Up Agreement
which states that the sale or transfer of the shares evidenced by the
certificate is subject to certain restrictions pursuant to an agreement
between the shareholder (whether beneficial or of record) and the
Underwriters, which agreement is on file with the Company and the Company's
stock transfer agent from whom a copy is available, upon request and without
charge.
(c) The terms and conditions of this Lock-Up Agreement can only be
modified (including premature termination thereof), upon the written consent
of the Underwriters and the prior approval of any state securities commission
which requires such consent.
(d) Stop transfer instructions will be placed with the transfer agent
against all shares of the Company's Common Stock subject to the restrictions
contained in
paragraph A(1) of this Lock-Up Agreement. Notwithstanding the foregoing,
shares subject to this Lock-Up Agreement may be transferred by the transfer
agent when shares are accompanied by an opinion of company counsel certifying
that such transfer is a permitted transfer.
If this agreement is acceptable to X.X. Xxxxxx, please sign the form of
acceptance below and deliver one of the counterparts hereof to me. This will
become a binding agreement between us upon execution by each of the parties
hereto.
Very truly yours,
--------------------------------------
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(Number of Shares Beneficially Owned)
AGREED to and ACCEPTED this
___ day of August 1998.
X.X. XXXXXX & COMPANY, LLC
By
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Authorized Signature
XXXXX XXXX AND SHIRE INCORPORATED
By
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Authorized Signature
