LOCK-UP AGREEMENT
Exhibit 10.7
This LOCK-UP AGREEMENT (this “Agreement”) is dated
as of June 25, 2010 by and between China Green Material Technologies, Inc., a
Nevada corporation, (the “Company”), and
_________ (the “Purchaser”).
WHEREAS, the Company intends to
consummate a private placement transaction with the Purchaser, whereby the
Company will issue, at a price of $1.50 per share, for up to an aggregate of
1,866,666 shares of the Company’s common stock, par value $0.01, (the “Common
Stock”) with an aggregate purchase price of up to $2,800,000 (the “Financing
Transaction”);
WHEREAS, in connection with the
Financing Transaction, the Company entered into a Securities Purchase Agreement,
dated as of the date hereof (the “Securities Purchase
Agreement”), by and between the Company and the Purchaser;
WHEREAS, in order to induce the Company
and the Purchaser to enter into the Financing Transaction, the Purchaser has
agreed not to sell any shares of the Company’s Common Stock except in accordance
with the terms and conditions set forth herein (the “Lock-Up Shares”).
Capitalized terms used herein without definition shall have the meanings
assigned to such terms in the Purchase Agreement.
NOW, THEREFORE, in consideration of the
covenants and conditions hereinafter contained, the Purchaser hereby agrees as
follows:
1. Restriction on Transfer;
Term.
The Purchaser hereby agrees that the
Purchaser will not, directly or indirectly, sell, offer to sell, contract to
sell, or grant any option for the sale (including without limitation any short
sale), grant any security interest in, pledge, hypothecate, hedge, establish an
open “put equivalent position” within the meaning of Rule 16a-1(h) under the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder (collectively, the “Exchange Act”) or
otherwise dispose of or enter into any transaction which is designed to, or
could be expected to, result in the disposition (whether by actual disposition
or effective economic disposition due to cash settlement or otherwise, directly
or indirectly ) of any shares of Common Stock (collectively, a “Disposition”)
currently or hereafter owned either of record or beneficially (as defined in
Rule 13d-3 under the Exchange Act) by the Purchaser, or publicly announce the
Purchaser’s intention to do any of the foregoing, for a period commencing on the
date hereof and continuing through the close of trading on the date that is
twenty-four (24) months following the Closing Date, as defined in the Securities
Purchase Agreement (the “Lock-up
Period”). The Purchaser also agrees and consents to the entry
of stop transfer instructions with the Company’s transfer agent and registrar
against the transfer of shares of Common Stock held by the
Purchaser.
The foregoing restriction has been
expressly agreed to preclude the holder of the Common Stock from engaging in any
hedging or other transaction which is designed to or reasonably expected to lead
to or result in a Disposition of the Common Stock during the Lock-up Period,
even if such Common Stock would be disposed of by someone other than such
holder. Such prohibited hedging or other transactions would include,
without limitation, any short sale (whether or not against the box) or any
purchase, sale, or grant of any right (including, without limitation, any put or
call option) with respect to any Common Stock or with respect to any security
(other than a broad-based market basket or index) that included, relates to, or
derives any significant part of its value from the Common Stock. The
Purchaser also agrees and consents to the entry of stop transfer instructions
with the Company’s transfer agent and registrar against the transfer of shares
of Common Stock held by the Purchaser except in compliance with the foregoing
restrictions.
2. Notices. All
notices, demands, consents, requests, instructions and other communications to
be given or delivered or permitted under or by reason of the provisions of this
Agreement or in connection with the transactions contemplated hereby shall be in
writing and shall be deemed to be delivered and received by the intended
recipient as follows: (i) if personally delivered, on the business day of such
delivery (as evidenced by the receipt of the personal delivery service), (ii) if
mailed certified or registered mail return receipt requested, two (2) business
days after being mailed, (iii) if delivered by overnight courier (with all
charges having been prepaid), on the business day of such delivery (as evidenced
by the receipt of the overnight courier service of recognized standing), or (iv)
if delivered by facsimile transmission, on the business day of such delivery if
sent by 6:00 p.m. in the time zone of the recipient, or if sent after that time,
on the next succeeding business day (as evidenced by the printed confirmation of
delivery generated by the sending party’s telecopier machine). If any notice,
demand, consent, request, instruction or other communication cannot be delivered
because of a changed address of which no notice was given (in accordance with
this Section 4), or the refusal to accept same, the notice, demand, consent,
request, instruction or other communication shall be deemed received on the
second business day the notice is sent (as evidenced by a sworn affidavit of the
sender). All such notices, demands, consents, requests, instructions and other
communications will be sent to the following addresses or facsimile numbers as
applicable.
If to the
Company:
27F
(Changqing Building)
000
Xxxxxxxxx Xxxx Xxxxx Xxxx
X.X.
Xxxxx 000000
Fax No.
00-000-00000000
with
copies (which copies shall not constitute notice to the Company)
to:
[ ]
If to the
Purchaser,
[ ]
or to
such other address as any party may specify by notice given to the other party
in accordance with this Section 4.
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3. Amendment. This
Agreement may not be modified, changed, supplemented, amended or terminated, nor
may any obligations hereunder be waived, except by written instrument signed by
each of the parties hereto.
4. Entire
Agreement. This Agreement contains the entire understanding
and agreement of the parties relating to the subject matter hereof and
supersedes all prior and/or contemporaneous understandings and agreements of any
kind and nature (whether written or oral) among the parties with respect to such
subject matter.
5. Governing
Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York, without giving
effect to any of the conflicts of law principles which would result in the
application of the substantive law of another jurisdiction. This Agreement shall
not be interpreted or construed with any presumption against the party causing
this Agreement to be drafted.
6. Waiver of Jury
Trial. EACH OF THE PARTIES HERETO HEREBY UNCONDITIONALLY AND
IRREVOCABLY WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION, SUIT OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY. EACH OF THE PARTIES UNCONDITIONALLY AND IRREVOCABLY
CONSENTS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK
LOCATED IN NEW YORK COUNTY AND THE FEDERAL DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK WITH RESPECT TO ANY SUIT, ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, AND
EACH OF THE PARTIES HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY OBJECTION
TO VENUE IN NEW YORK COUNTY OR SUCH DISTRICT, AND AGREES THAT SERVICE OF ANY
SUMMONS, COMPLAINT, NOTICE OR OTHER PROCESS RELATING TO SUCH SUIT, ACTION OR
OTHER PROCEEDING MAY BE EFFECTED IN THE MANNER PROVIDED IN SECTION
4.
7. Severability. The
provisions of this Agreement are severable and, in the event that any court of
competent jurisdiction shall determine that any one or more of the provisions or
part of the provisions contained in this Agreement shall, for any reason, be
held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision or part of a
provision of this Agreement and such provision shall be reformed and construed
as if such invalid or illegal or unenforceable provision, or part of such
provision, had never been contained herein, so that such provisions would be
valid, legal and enforceable to the maximum extent possible.
8. Binding Effect;
Assignment. This Agreement and the rights and obligations
hereunder may not be assigned by the Purchaser hereto without the prior written
consent of the Company. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective successors and permitted
assigns.
9. Headings. The
section headings contained in this Agreement are inserted for reference purposes
only and shall not affect in any way the meaning, construction or interpretation
of this Agreement. Any reference to the masculine, feminine, or neuter gender
shall be a reference to such other gender as is appropriate. References to the
singular shall include the plural and vice versa.
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10. Counterparts. This
Agreement may be executed in any number of counterparts, each of which when so
executed shall be deemed to be an original and, all of which taken together
shall constitute one and the same Agreement and shall become effective when
counterparts have been signed by each party and delivered to the other parties
hereto, it being understood that all parties need not sign the same counterpart.
In the event that any signature is delivered by facsimile transmission, such
signature shall create a valid binding obligation of the party executing (or on
whose behalf such signature is executed) the same with the same force and effect
as if such facsimile signature were the original thereof.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]
[SIGNATURE
PAGE TO LOCK-UP AGREEMENT]
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IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
written above herein.
By: /s/
Signed
Name:
Zhonghao Su
Title:
Chief Executive Officer
[Purchaser]
By: /s/
Signed
Name:
Title:
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