Lock-Up Agreement
EXHIBIT
10.4
July 10,
0000
XxxxXxxxx
Xxxxxxxxxxx
000 Xxxxx
Xxxxxx, Xxxxxxx, XX 00000
Re:
WindTamer
Corporation –
Lock-Up Agreement
Dear
Sirs:
In
connection with the establishment of a public market trading of shares of common
stock (the “Common Stock”) of WindTamer Corporation and any successor (by merger
or otherwise) thereto (the “Company”), the undersigned agrees that, commencing
on the date that the Common Stock begins trading on any of the OTC Bulletin
Board Market, an over-the-counter market, any national securities exchange
or quotation service or otherwise (the “Effective Date”), and during the period
specified below (the “Lock-Up Period”), the undersigned will not, directly or
indirectly, offer, sell, contract to sell, pledge, grant any option to purchase,
make any short sale or otherwise dispose of any shares of Common Stock, or
securities convertible into or exchangeable or exercisable for any shares of
Common Stock, whether any such aforementioned transaction is to be settled by
delivery of Common Stock or such other securities, in cash or otherwise, owned
directly or indirectly by the undersigned (including holding as a custodian) or
with respect to which the undersigned has beneficial ownership within the
rules and regulations of the Securities and Exchange Commission
(collectively the “Undersigned’s Shares”).
The
foregoing restriction is expressly agreed to preclude, without limitation, the
undersigned from engaging in any hedging, swap or other arrangement or
transaction which is designed to or which reasonably could be expected to lead
to, result in or have the same effect of a sale, transfer or disposition of any
of the Undersigned’s Shares even if such Shares would be disposed of by someone
other than the undersigned. Such prohibited hedging or other transactions
would include, without limitation, any short sale or any purchase, sale or grant
of any right (including without limitation any put or call option) with respect
to any of the Undersigned’s Shares or with respect to any security that
includes, relates to, or derives any significant part of its value from such
Shares.
The
undersigned agrees not to publicly disclose during the Lock-Up Period the
intention to make or enter into any such transaction regarding the Undersigned’s
Shares described in the above paragraphs.
The
Lock-Up Period will commence on the date hereof and continue until the 12-month
anniversary of the Effective Date.
Notwithstanding
the foregoing, the undersigned may transfer the Undersigned’s Shares (i) as
a bona fide gift or
gifts to a member of members of the immediate family of the undersigned,
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 members of 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. For purposes of this
Lock-Up Agreement, “immediate family” shall mean any relationship by blood,
marriage or adoption, not more remote than first cousin.
Notwithstanding
anything to the contrary contained herein, the undersigned may, subject to the
Company’s Xxxxxxx Xxxxxxx Policy, sell (1) such number of the Undersigned’s
Shares to generate $250,000 in gross proceeds between the six-month anniversary
of the Effective Date and the twelve-month anniversary of the Effective Date but
in no event more than 250,000 of the Undersigned’s Shares, (2) such number of
the Undersigned’s Shares to generate $250,000 in gross proceeds between the
12-month anniversary of the Effective Date and the 18-month anniversary of the
Effective Date but in no event more than 250,000 of the Undersigned’s Shares,
(3) any or all of the 200,000 Undersigned’s Shares held as of July 7, 2009, and
(4) any or all of the 400,000 Undersigned’s Shares acquired upon the exercise of
stock options held as of July 7, 2009. For purposes of
this paragraph, shares sold under (3) or (4), above, shall not be applied
towards (1) and (2), above.
The
undersigned represents and warrants that he now has, and, except as contemplated
by clauses (i) and (ii) in the above paragraph, for the duration of
this Lock-Up Agreement will have, good and marketable title to the Undersigned’s
Shares, free and clear of all liens, encumbrances, and claims
whatsoever.
The
undersigned also agrees and consents to the entry of stop transfer instructions
with the Company’s transfer agent and registrar against the transfer of the
Undersigned’s Shares except in compliance with the foregoing
restrictions. The Company and its transfer agent and registrar are hereby
authorized to decline to make any transfer of shares of Common Stock if such
transfer would constitute a violation or breach of this Lock-Up
Agreement.
In
addition, the undersigned agrees that, he will not, during the Lock-Up Period,
make any demand for or exercise any right with respect to, the registration of
any Securities or any security convertible into or exercisable or exchangeable
for the Securities.
The
undersigned understands and agrees that this Lock-Up Agreement is irrevocable
and shall be binding upon the undersigned’s heirs, legal representatives,
successors, and assigns.
This
Lock-Up Agreement may be executed in two counterparts, each of which shall be
deemed an original but both of which shall be considered one and the same
instrument.
This
Lock-Up Agreement will be governed by and construed in accordance with the laws
of the State of New York, without giving effect to any choice of law or
conflicting provision or rule (whether of the State of New York or any
other jurisdiction) that would cause the laws of any jurisdiction other than the
State of New York to be applied. In furtherance of the foregoing, the
internal laws of the State of New York will control the interpretation and
construction of this Lock-Up Agreement, even if under such jurisdiction’s choice
of law or conflict of law analysis, the substantive law of some other
jurisdiction would ordinarily apply.
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Very
truly yours,
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Xxxxx
Xxxxx
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Exact
Name of Shareholder
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/s/
Xxxxx Xxxxx
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Authorized
Signature
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Agreed to
and Acknowledged:
WINDTAMER
CORPORATION
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By:
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/s/ Xxxxxx Xxxxx |
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Name:
Xxxxxx Xxxxx
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Title:
Chief Executive
Officer
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