Lock-Up; Leak-Out Clause Samples
The Lock-Up; Leak-Out clause restricts the immediate sale or transfer of securities by certain shareholders following a transaction, such as an IPO or acquisition. Typically, it imposes a lock-up period during which these shareholders cannot sell their shares, followed by a leak-out period that allows them to sell only a limited amount over time, often in specified increments. This clause helps prevent large, sudden sales that could negatively impact the market price and ensures an orderly transition of shares into the public market.
Lock-Up; Leak-Out. (a) The Holder agrees that they shall not transfer, offer, pledge, sell, contract to sell, grant any options for the sale of, assign or otherwise dispose of, directly or indirectly, for twelve (12) months from the Effective Date (as defined above), the Shares (the “Lockup Shares”) held by such Holder, subject to Section 1(b) below. If requested by an underwriter of Common Stock, each Holder will reaffirm the agreement set forth in this Section 1(a) in a separate writing in a form satisfactory to such underwriter. The Company may impose stop-transfer instructions with respect to the Lockup Shares.
(b) Notwithstanding the foregoing, if a Holder seeks permission to sell shares before the Effective Date or in amounts exceeding limits stipulated in this Agreement, the Holder may request a waiver from the Board of Directors. If the Board of Directors grants such a waiver, then before the waiver takes effect, 50% of the shares subject to that waiver must be transferred to one or more Acquisition Credit (“AC”) holders in exchange for AC amounts equal to the dollar amount of stock being sold by the Holder from those AC holders receiving the shares. Any Holder who receives AC as payment obtains the same conversion rights as the other AC holders.
(c) Notwithstanding the foregoing, the restrictions set forth in Section 1(a) above shall not apply to (A) the sale by the Holder of up to 2% of the Lockup and not more than 10% of daily stock liquidity, whichever is lower, commencing 3 months after Acquisition Credit holders can first sell their shares (the “Effective Date”), which is estimated to be approximately 9 months after the first closing, (B) transfers (i) as a bona fide gift or gifts, provided that the donee or donees thereof agree to be bound in writing by the restrictions set forth herein, or (ii) to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned, provided that the trustee of the trust agrees to be bound in writing by the restrictions set forth herein, and provided further that any such transfer shall not involve a disposition for value, or (C) with the prior written consent of the Board of Directors of the Company. For purposes of this Letter Agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin. The 2% restriction is increased pursuant to the following schedule: 10th month 2% 11th month 2% 12th month 5% 13th month 5% 14th month 5% 1...
Lock-Up; Leak-Out. The parties shall have executed and delivered each to the other a Lock-Up Agreement in the form annexed hereto as Exhibit A.
Lock-Up; Leak-Out. Except as provided herein, the terms of the Lock-Up/Leak-Out Agreement among the Company, Executive, ▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ as Trustee of the Raphael and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Family Trust dated May ___, 2005 (the “LU/LO Agreement”) is incorporated herein by reference. The “Leak-Out Period” as defined in the LU/LO Agreement shall be extended so that it shall commence on June 1, 2006 and extend through the greater of (i) the Term of Executive’s employment under this Agreement and any consulting or other retention period after the Termination Date during which Executive continues to provide services to the Company, or (ii) seven (7) years from the date of execution of this Agreement (the “First Leak-Out Period”). A further extension of the Leak-Out Period shall commence immediately on the day after the last day of the First Leak-Out Period and shall be extended through the seventh anniversary of the day after the last day of the First Leak-Out Period (the “Second Leak-Out Period”). During the First Leak-Out Period and the Second Leak-Out Period, Executive shall be limited to the sale or disposition of an aggregate total of 50,000 shares of Company common stock in any consecutive three (3) month period.
Lock-Up; Leak-Out. The Investor agrees to be bound by the Lock-Up / Leak-Out Agreement, of any in the form, attached as Appendix F.
Lock-Up; Leak-Out. The Investor agrees to be bound by the Lock-Up / Leak-Out Agreement, of any in the form required by the Company’s underwriters in connection with any initial public offering or any other form of going public transaction.
Lock-Up; Leak-Out. New York Farms Group, Inc., the holder of the shares of ICNB and holder of forty-nine percent (49%) of the issued and outstanding equity interests of GGFI, shall have executed and delivered to ICNB a lock-up/leak-out agreement in the form annexed hereto as Exhibit E.
Lock-Up; Leak-Out. ICNB shall have executed and delivered to CANB a lock-up/leak-out agreement in the form annexed hereto as Exhibit D.
Lock-Up; Leak-Out. The provisions set forth in Section 7.11 (Lock Up/Leak Out) of the Equity Purchase Agreement are hereby incorporated by reference as such provisions relate to Seller.
Lock-Up; Leak-Out. Except as permitted in connection with Seller’s Put Option (defined below), or with the written consent of Buyer, Seller shall be prohibited from selling, hypothecating or otherwise dividing or assigning the Sundance Shares for a period of 12 months from the date of issuance and such restrictions shall be set forth on the stock certificates evidencing the Sundance Shares.
Lock-Up; Leak-Out. The Holder agrees that for all shares of the Issuer’s common stock issued to the Holder hereunder, the Holder shall not sell any such shares for at least two days after receipt of such shares (such that Holder’s broker shall not sell short any shares after issuing a notice of conversion but before Holder’s broker receives conversion shares). The Holder also agrees that the Holder shall not sell a number of shares of Issuer’s common stock on any trading day exceeding (i) ten percent (10%) of the daily trading volume of the Issuer’s common stock (the “Trading Volume”) during any trading day when the Trading Volume is less than 200,000 shares, or (ii) twenty percent (20%) of the Trading Volume during any trading day when the Trading Volume is equal to or greater than 200,000 shares.