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EXHIBIT 10.4
LOCK-UP AGREEMENT
THIS LOCK-UP AGREEMENT (the "AGREEMENT") is made and entered
into as of the 14th day of February, 2005, between Technest
Holdings, Inc., a
Nevada corporation ("TECHNEST"), and the individuals that
execute and deliver a
Counterpart Signature Page hereof, and sometimes collectively
referred to herein
as the "SHAREHOLDERS" and each, a "SHAREHOLDER." For all
purposes of this
Agreement, "Shareholder" includes any "affiliate, controlling
person of
Shareholder, agent, representative or other person with whom
Shareholder is
acting in concert with.
WHEREAS, Markland Technologies, Inc, a Florida corporation
(the "BUYER"), is acquiring Common Stock of Technest (the
"CHANGE IN CONTROL
TRANSACTION"); and
WHEREAS, the Buyer that is participating in the Change in
Control Transaction has identified a potential reorganization,
merger or
acquisition for Technest that may or may not be completed or if
completed, may
or may not be beneficial to Technest and its stockholders (the
"REORGANIZATION
TRANSACTION"); and
WHEREAS, in order to facilitate the consummation of the
transactions contemplated by the Change in Control Transaction
and the
Reorganization Transaction and to protect the Company, the
Shareholders have
agreed to enter into this Agreement and to restrict the public
sale, assignment,
transfer, conveyance, hypothecation or alienation of the Common
Stock, all on
the terms set forth below.
NOW, THEREFORE, in consideration of the foregoing premises
and
the mutual covenants contained herein, the receipt and
sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Except as otherwise expressly provided herein, and except
as each Shareholder may be otherwise restricted from selling
shares of Common
Stock, each Shareholder agrees (a) not to directly or
indirectly, sell, offer,
contract or grant any option to sell (including without
limitation any short
sale), pledge, transfer, establish an open "put equivalent
position" within the
meaning of Rule 16a-1(h) under the Securities Exchange Act of
1934, as amended
(the "EXCHANGE ACT"), or enter into any swap, hedge or other
arraignment to
transfer any economic consequences of ownership or otherwise
dispose of any of
the Common Stock or publicly announce the undersigned's
intention to do any the
foregoing, for the period commencing on the execution and
delivery of this
Agreement and until the earlier of (i) the seven (7) month
period from the
filing of a Form 8-K ("SUCCESSOR ISSUER 8-K") in connection with
the Closing of
the Reorganization Transaction and (ii) such time as there shall
be an effective
registration statement providing for the sale of the
Shareholders' Common Stock
(the "LOCK-UP PERIOD");
2. An appropriate legend describing this Agreement shall be
imprinted on each stock certificate representing Common Stock
covered hereby,
and the transfer records of Technest transfer agent shall
reflect such
appropriate restrictions.
3. During the Lock-Up Period, Technest shall maintain its
"reporting" status with the Securities and Exchange Commission;
file all reports
that are required to be filed by it during such period; and use
its best efforts
to ensure that the Common Stock is continually quoted for public
trading on a
nationally recognized medium of no less significance than the
OTC Electronic
Bulletin Board of the National Association of Securities
Dealers, Inc. (the
"NASD"), the NASDAQ Small Cap or a recognized national stock
exchange.
4. Each Shareholder signing this Agreement shall have the
right to have any shares of Common Stock subject to this
Agreement included in
the next registration statement to be filed by Technest for the
sale of its
Common Stock (other than a registration statement on Forms S-8
or S-4).
Notwithstanding anything to the contrary set forth herein,
Technest may, in its
sole discretion and in good f
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