LOCK-UP AGREEMENT
THIS LOCK-UP AGREEMENT (this
“Agreement”) is made and entered into as of December ___, 2010, by and
among Piper Acquisition III, Inc., a Nevada corporation (the "Company")
and _________ (the “Holder”), including the Holder’s successors and
permitted assigns.
WHEREAS,
on December __, 2010, effective December 1, 2010, the Company, First Street
Hospital, L.P. (“Hospital”) , First Surgical Woodlands, L.P. (“Woodlands”),
First Street Surgical Center, L.P. (“Surgical Center”), First Surgical Partners,
L.L.C. (“Partners” and together with Hospital, Woodlands and Surgical Center,
the “Entities”) and the partners and/or members of the Entities, including the
Holder, entered into a Contribution Agreement (the “Contribution
Agreement"), pursuant to which the Company acquired the Entities (the
“Contribution”);
WHEREAS,
at the effective time of the Contribution, the Holder shall receive shares
of the Company's common stock in connection with the Contribution (the
“Shares”);
WHEREAS,
the execution and delivery of this Agreement is a condition precedent to
the consummation of the Contribution and the other
transactions contemplated by the Contribution Agreement;
WHEREAS,
the Holder understands that the Company and its shareholders will enter into and
close a contribution agreement or similar arrangement (the “Reverse Merger”)
with a corporation that files periodic reports with the U.S. Securities Exchange
Commission (the “Shell”) and, upon closing the Reverse Merger, the Holder will
contribute the Shares to the Shell in exchange for shares of common stock of the
Shell;
WHEREAS, the Holder understands and
agrees that the agreements, covenants, restrictions and responsibilities set
forth in this Agreement shall remain binding upon Holder and in full effect with
respect to the securities of the Shell that the Holder receives in exchange for
the Shares (the “Shell Securities” and together with the Shares, the
“Securities”).
NOW,
THEREFORE, in consideration of the foregoing and of the mutual covenants
and agreements set forth herein, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, there parties
hereto agree as follows:
1. Lock-up
Agreement; Clawback.
(a)
The Holder agrees that it shall not transfer, offer, pledge, sell, contract
to sell, grant any options for the sale of or otherwise dispose of,
directly or indirectly, any Securities held by such Holder through December 1,
2020. If requested by an underwriter of Common Stock, each Holder will
reaffirm the agreement set forth in this Section 1 in a separate writing in
a form satisfactory to such underwriter. The Company may impose
stop-transfer instructions with respect to the Securities.
(b)
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 10% of the Holder’s
Securities per year, (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, (C) with the prior written consent of the Board of
Directors of the Company, or (D) the exchange of the Shares for shares of common
stock of the Shell in connection with the Reverse Merger. For
purposes of this Letter Agreement, “immediate family” shall mean any
relationship by blood, marriage or adoption, not more remote than first
cousin.
(c) The Shares, the Shell Securities
or any securities issued in exchange of the Shares shall be returned to the
Company for cancellation upon the Holder’s (A) breach of this Agreement, (B)
breach of the Non-Compete Agreement entered by and between the Company and
Holder, (C) breach of the Voting Agreement entered by and between the Company
and Holder (D) failure to maintain the required medical license by Holder or
Holder’s affiliates, (E) the commencement, whether voluntary or involuntary, of
any bankruptcy documentation by the Holder.
2. Piggyback
Registrations. If the Company, or any successor, proposes to file
any registration statement under the Securities Act for purposes of an
offering of securities of the Company (including, but not limited to,
registration statements relating to secondary offerings of securities of
the Company, but excluding Registration Statements relating to employee
benefit plans or other compensatory arrangements or with respect to
corporate reorganizations, or other transactions under Rule 145 of the
Securities Act), the Company agrees that it will use its best efforts to
include 10% of the Shares or Shell Securities, as applicable, on such
registration statement.
3. Restrictive
Legend. All certificates representing the Securities deliverable to
the Holder pursuant to the Contribution or the Reverse Merger and any
certificates subsequently issued with respect thereto or in substitution
therefor shall bear a legend substantially as follows, in addition to
any legend the Company determines is required pursuant to any applicable
legal requirement including the standard legend required under the Securities
Act of 1933, as amended:
"The
shares represented by this certificate may not be offered, sold, pledged,
transferred or otherwise disposed of except in accordance with
the requirements of the Securities Act of 1933, as amended, and the
other conditions specified in that certain Contribution Agreement dated
as of December 1, 2010 and that certain Lock-Up Agreement dated as of
December 1, 2010, copies of which agreements the Company will furnish, without
charge, to the holder of this certificate upon written request
therefor."
The
Company, at its discretion, may cause a stop transfer order to be
placed with its transfer agent(s) with respect to the certificates
representing the Securities.
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4.
Miscellaneous.
(a) Amendments
and Waivers. The provisions of this Agreement, including the provisions of
this sentence, may not be amended, modified or supplemented, and waivers or
consents to departures from the provisions hereof may not be given without
the written consent of the Company and the Holder.
(b) Notices.
All notices and other communications provided for or permitted hereunder
shall be made in writing by hand-delivery, registered first- class mail,
telex, telecopier, or any courier guaranteeing overnight delivery to the
addresses for the Holder and the Company set forth in the Contribution
Agreement. All such notices and communications shall be deemed to
have been duly given: at the time delivered by hand, if personally
delivered; five business days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt is
acknowledged, if telecopied; or at the time delivered if delivered by an
air courier guaranteeing overnight delivery.
(c) Successors
and Assigns. This Agreement shall inure to the benefit of and be binding
upon the successors and permitted assigns as permitted hereunder of each of
the parties. Specifically, the Holder understands and agrees that the
agreements, covenants, restrictions and responsibilities set forth in this
Agreement shall remain binding upon Holder and in full effect with respect to
the Securities of the Shell that the Holder receives in exchange for the
Shares.
(d) Counterparts.
This Agreement may be executed in any number of counterparts and by the
parties hereto in separate 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.
(e) Headings.
The headings in this Agreement are for convenience of reference only and
shall not limit or otherwise affect the meaning hereof.
(f) Governing
Law. This agreement shall be governed by and construed in accordance with
the laws of the State of Nevada without giving effect to the conflicts of
law provisions thereof.
(g) Specific
Performance. The parties hereto acknowledge that there would be no adequate
remedy at law if any party fails to perform any of its obligations
hereunder, and accordingly agree that each party, in addition to any other
remedy to which it may be entitled at law or in equity, shall be
entitled to compel specific performance of the obligations of any other
party under this Agreement in accordance with the terms and conditions of
this Agreement in any court of the United States or any State thereof
having jurisdiction.
(h) Entire
Agreement. This Agreement is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive statement of
the agreement and understanding of the parties hereto in respect of the
subject matter contained herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to
such subject matter.
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(i) Additional
Actions and Documents. The parties hereto shall take or cause to be taken
such further actions, shall execute, deliver and file, or cause to be
executed, delivered or filed, such further documents and instruments, and
shall obtain such consents as may be necessary or as the other party may
reasonably request, without the payment of further consideration, in
order
fully to effectuate the purposes, terms and conditions of this
Agreement.
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
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COMPANY:
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HOLDER:
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PIPER
ACQUISITION III. Inc.
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By:
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Name:
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Title:
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