Exhibit 4.39
LOCK-UP AND WAIVER AGREEMENT
October 17, 2000
Insynq, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxx
Ladies and Gentlemen:
The undersigned understands that Insynq, Inc., a Delaware corporation (the
"Company"), is currently negotiating agreements to sell $3 million of
convertible debentures and up to $10 million shares of its Common Stock, $0.001
par value ("Common Stock") to certain purchasers thereunder (the "Purchasers"),
and in connection with such agreements, the Company will be required to register
shares of Common Stock to be purchased by the Purchasers and other shares of
Common Stock underlying the convertible debentures and warrants to be purchased
by the Purchasers pursuant to a Registration Statement on Form SB-2 (the
"Finance Registration Statement").
The Company believes that the above-described financings are in the best
interests of the Company, and the Purchasers have required that the Company
receive letters from certain of its shareholders to address the Purchasers'
concerns and conditions to providing such financings. Consequently, the Company
is hereby requesting this letter from the undersigned as a material inducement
to the Purchasers' agreement to enter into the above-described financings. The
Company believes that the failure of the undersigned to execute and deliver this
Agreement could result in the inability of the Company to continue its
operations.
In consideration of the foregoing and the indirect benefits that will be
realized by the undersigned as a holder of the Company's equity securities from
the financings described above, and notwithstanding the registration rights
previously granted to the undersigned by the Company, the undersigned hereby
waives any rights it may have to participate in the Finance Registration
Statement and further waives the exercise of any such registration, repurchase
or "put" rights it may have for a period of 180 business days ( defined as days
when the securities markets are open and trading) after the Finance Registration
Statement is declared effective by the Securities and Exchange Commission, plus
such number of business days after the effective date that the Purchasers are
not permitted to utilize the Registration Statement to sell shares (the "Waiver
Period"). In addition, the undersigned agrees that it will not, until the
expiration of the Waiver Period, directly or indirectly (i) offer to sell, sell
or contract to sell otherwise sell, dispose of, loan, pledge or grant any rights
with respect to any shares of Common Stock or securities convertible into or
exchangeable for any shares of Common Stock, or (ii) enter into any swap or any
other agreement or any transaction that transfers, in whole or in part, directly
or indirectly, the economic consequence of ownership of the Common Stock,
whether any such swap or transaction is to be settled by delivery of Common
Stock or other securities, in cash or otherwise.
The undersigned further agrees that this Agreement may not be amended
without the consent of the Company and the Purchasers in writing, and that the
Purchasers are deemed to be third-party beneficiaries to this Agreement with the
right to enforce this agreement as if it were the Company hereunder.
The undersigned further agrees that it will deliver to the Company its
shares of Common Stock currently held, if any, so that the Company will place a
restrictive legend on such shares to evidence the agreements set forth in this
letter, and further consents to the entry of stop transfer instructions with the
Company's transfer agent against any transfer of shares of Common Stock held by
the undersigned not in compliance with this Agreement.
The undersigned represents and warrants that it owns the number of shares
of Common Stock, or securities convertible into or exercisable for the number of
shares of Common Stock, indicated below its signature to this Agreement, and has
the power to enter into and perform its obligations under this Agreement. The
undersigned further understands and agrees that its execution and delivery of
this Agreement to the Company will constitute its binding agreement with respect
to the matters set forth herein.
Very truly yours,
Signature: /s/ Xxxxxxx X. Xxxxxx
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Printed Name: Xxxxxxx X. Xxxxxx
No. of Shares Owned: 496,466
No. of Shares Subject to Warrants, Options to
Debentures: None
-2-
AMENDMENT NO. 1 TO LOCK-UP AGREEMENT
This Amendment No. 1 of Lock-Up ("Amendment No. 1") is effective as of
November 30, 2000, by and between Insynq, Inc., a Delaware corporation (the
"Company") and Xxxxxxx X. Xxxxxx ("Shareholder").
WHEREAS, the Shareholder has executed that certain Lock-Up Agreement as of
October 17, 2000; and
WHEREAS, pursuant to that certain Lock-Up Agreement Shareholder waived the
exercise of any previously granted registration, repurchase or "put" rights he
may have had for a period of 180 business days (defined as days when the
securities markets are open and trading); and
WHEREAS, the Shareholder is an affiliate (as that term is defined by the
Securities and Exchange Commission) of the Company and is therefore subject to
certain restrictions on sales of common stock of the Company.
NOW, THEREFORE, in consideration of the foregoing, and of the mutual
covenants hereafter contained, and of other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
The Shareholder shall be allowed to sell up to 50,000 shares during each
calendar quarter beginning March 30, 2001. All other aspects of the Lock-Up
Agreement shall remain in effect.
INSYNQ, INC.
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
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Title: Chairman, CEO
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XXXXXXX X. XXXXXX, individually
/s/ Xxxxxxx X. Xxxxxx
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