Exhibit 10.8
LOCK-UP AGREEMENT
___________, 2003
Gilford Securities Incorporated
000 Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx, XX 00000
Attn: Managing Director of Corporate Finance
Gentlemen:
The undersigned (the "SECURITYHOLDER") understands that Gilford Securities
Incorporation (the "Managing Agent"), has entered into a letter of intent (the
"LETTER OF INTENT") with Natural Golf Corporation (the "COMPANY"), pursuant to
which the Managing Agent confirmed its intent to act as the managing agent in
connection with a proposed public offering, whether in the form of a "best
efforts" or "firm commitment" (the "OFFERING") of shares of common stock (the
"COMMON STOCK") to be issued by the Company.
1. In consideration of the Managing Agent entering into the Letter of Intent and
agreeing to incur expenses thereunder, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Securityholder agrees that the Securityholder will not, without the prior
written consent of the Managing Agent, directly or indirectly offer, sell,
pledge, contract to sell (including any short sale), grant any option to
purchase, enter into any contract to sell or otherwise dispose of or transfer
any shares of Common Stock (including without limitation, any shares of
Common Stock which may be deemed to be beneficially owned by the
Securityholder in accordance with the rules and regulations of the Securities
and Exchange Commission (the "SEC"), any shares of Common Stock which may be
issued upon exercise of any stock options or warrants or upon conversion or
exchange of any convertible or exchangeable securities) or any debentures,
rights, warrants, options or other securities that are convertible into, or
exercisable or exchangeable for, Common Stock (collectively, "RIGHTS") or
enter into any Hedging Transaction (as defined below) (each of the foregoing
referred to as a "DISPOSITION") for a period beginning on the date hereof and
continuing through and including the date which is the date eleven (11)
months from the initial closing date of the Offering (the "LOCK-UP PERIOD").
Notwithstanding the foregoing, the Lock-up Period shall not be longer than
thirty (30) days less than the shortest lock-up period agreed to by any
officer or director of the Company in connection with this Offering, and no
officer or director of the Company shall be released from any such lock-up
agreement unless the Securityholder first has been released from the Lock-Up
Period. The foregoing restriction is expressly intended to preclude the
Securityholder from engaging in any Hedging Transaction or other transaction
which is designed to or is reasonably expected to lead to or result in a
Disposition during the Lock-Up Period even if the securities would be
disposed of by someone other than the Securityholder. "Hedging Transaction"
means 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 security (other than
a broad-based market basket or index) that includes, relates to or derives
any significant part of its value from the Common Stock or any Rights. The
foregoing restrictions set forth in this paragraph shall apply to all shares
of Common Stock and all Rights now owned or hereafter acquired by the
Securityholder, except that such restrictions shall not apply to shares of
Common Stock and Rights acquired in open market transactions after the
completion of the Offering.
2. Notwithstanding the foregoing, the Securityholder may transfer any or all of
the Securityholder's Common Stock or Rights (i) if the Securityholder is a
natural person, by gift, will or intestacy so long as the transfer is not for
value; (ii) if the Securityholder is a natural person, to any trust for the
direct or indirect benefit of the Securityholder or the immediate family of
the Securityholder so long as the transfer is not for value; (iii) if the
Securityholder is a partnership, to a partner of such partnership or a
retired partner of such partnership who retires after the date hereof so long
as the transfer is not for value; and (iv) if the Securityholder is a
corporation, limited liability company or limited partnership to any of its
wholly-owned subsidiaries; provided, however, that in any such case it shall
be a condition to the transfer that, prior to or concurrently with such
transfer, the transferee executes and delivers to the Managing Agent an
agreement, in form and substance satisfactory to the Managing Agent, stating
that the transferee is receiving and agrees to hold the Common Stock or
Rights, as the case may be, subject to the provisions of this letter
agreement, and there shall be no further transfer of such Common Stock or
Rights, as the case may be, except in accordance with this letter agreement.
For purposes of this Lock-Up Agreement, "immediate family" shall mean any
relationship by blood, marriage, or adoption, not more remote than first
cousin.
3. Without limiting the restrictions herein, any Disposition by the
Securityholder shall remain at all times subject to applicable securities
laws, including without limitation the resale restrictions imposed by Rule
144 promulgated under the Securities Act of 1933, as amended.
4. The Securityholder hereby agrees that, to the extent that the terms of this
letter agreement conflict with or are in any way inconsistent with any
registration rights agreement or similar agreement to which the
Securityholder is a party or under which the Securityholder is entitled to
any right or benefit, this letter agreement supersedes such registration
rights agreement or similar agreements.
5. The Securityholder understands that the Company and the Managing Agent intend
to proceed with the Offering in reliance on this letter agreement.
6. This letter agreement shall immediately terminate, and the Securityholder
shall have no further obligations, nor shall the Managing Agent have any
further rights, under this letter agreement, if either (i) the Letter of
Intent is terminated at any time or (ii) a registration statement in
connection with the Offering shall not have been declared effective by the
SEC on or before June 30, 2004.
7. This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York without regard to the conflicts of
laws principles thereof. The parties
hereto hereby irrevocably agree that any suit or proceeding arising directly
and/or indirectly pursuant to or under this Agreement, shall be brought
solely in a federal or state court located in the City, County and State of
New York. By its execution hereof, the parties hereby covenant and
irrevocably submit to the IN PERSONAM jurisdiction of the federal and state
courts located in the City, County and State of New York and agree that any
process in any such action may be served upon any of them personally, or by
certified mail or registered mail upon them or their agent, return receipt
requested, with the same full force and effect as if personally served upon
them in New York City. The parties hereto waive any claim that any such
jurisdiction is not a convenient forum for any such suit or proceeding and
any defense or lack of IN PERSONAM jurisdiction with respect thereto. In the
event of any such action or proceeding, the party prevailing therein shall be
entitled to payment from the other party hereto of its reasonable counsel
fees and disbursements.
8. The Securityholder hereby represents and warrants that the Securityholder has
full power and authority to enter into this letter agreement and that this
letter agreement has been duly authorized (if applicable), executed and
delivered by the Securityholder and is a valid and binding agreement of the
Securityholder. All authority herein conferred or agreed to be conferred
shall survive the death or incapacity of the Securityholder and any
obligations of the Securityholder shall be binding upon the heirs, personal
representatives, successors and assigns of the Securityholder.
Very truly yours,
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(Signature)
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(Print Name)
