LOCK-UP AGREEMENT
__________,
2007
00000
Xxxxxxxx Xxxxxxxxx, Xxxxx0000
Xxx
Xxxxxxx, XX 00000
| Attention: |
Chief
Executive Officer
Chief
Financial Officer
|
Gentlemen:
This
Lock-Up Agreement is entered into by the undersigned for the benefit of Hunter
World Markets, Inc. The undersigned is the owner of [an
option
to purchase _____shares of common stock, par value $0.0001, at $______per
share under
the
2006 Stock Option Plan]1[a
warrant
to purchase ______shares of common stock, par value $0.0001, at an exercise
price of $____ per share]2[
_____
shares of common stock, par value $0.0001]
3
(the
“Covered
Securities”)
of
ProElite, Inc., a New Jersey corporation (the “Company”).
The
undersigned hereby agrees that, during the period beginning on the date hereof
(the
“Effective
Date”)
and
ending on the date that is 18 months after the date the Company receives
notification by the Securities and Exchange Commission that the registration
statement required to be filed by the Company pursuant to that certain
Registration Rights Agreement between the Company and the investors of the
Company’s private placement offering on June 30, 2007 (the “Registration
Statement”)
has
been declared effective (the
“Lock-Up
Period”),
the
undersigned will not: (1) sell, transfer, assign, pledge or hypothecate any
Covered Securities, unless it is to an individual, entity or charity that agrees
to be subject to the terms and conditions of this Lock-Up Agreement or (2)
subject the Covered Securities to any hedging, short sale, derivative, put,
or
call transactions that would result in the effective economic disposition of
the
Covered Securities by any person (the “Lock-Up”).
Notwithstanding
the foregoing:
1. The
Lock-Up shall not apply during the period that the sales price per share of
common stock is at least $15.00, provided (A) the Registration Statement has
been declared effective by the Securities and Exchange Commission and is then
still effective and (B) the shares of the Company’s common stock are then listed
on the Nasdaq Stock Market or the American Stock Exchange.
2. The
Lock-Up shall not prevent transactions where the transferee agrees to be bound
by the terms of this Lock-Up Agreement.
1
For
option holders only
2
For
warrant holders
3
Only
applicable to the shareholders in the initial lock-up.
[3. This
Lock-Up Agreement shall terminate upon receipt of a written notice from Hunter
World Markets, Inc. requesting the Company to release a portion or all of the
Covered Securities from the provisions of this Lock-Up Agreement. Such notice
shall be attached to this Lock-Up Agreement.]4
The
obligations of the undersigned that are contained in this letter agreement
also
apply (i) to all Covered Securities that the undersigned may receive as a
stock dividend or other distribution on the Covered Securities and (ii) to
all other securities of the Company that the undersigned may receive in a
recapitalization or similar transaction in exchange for Covered Securities
acquired by the undersigned.
The
undersigned consents to the entry of stop transfer instructions with the
Company’s transfer agent and registrar against the transfer of the Covered
Securities except in compliance with the preceding provisions of this Lock-Up
Agreement. The undersigned also consents to the placement of the following
legend on any and all stock certificates that evidence the Covered Securities
which are the subject of this Lock-Up Agreement:
“THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS OF THAT CERTAIN
LOCK-UP AGREEMENT BETWEEN THE COMPANY AND THE SHAREHOLDERS NAMED THEREIN, DATED
AS OF [_______], 2007. A COPY OF THE LOCK-UP AGREEMENT MAY BE INSPECTED AT
THE
PRINCIPAL OFFICE OF THE COMPANY.”
4
Only
applicable to the shareholders in the initial lock-up.
2
|
Very
truly yours,
|
|||
| Shareholder Name: | |||
|
Number
of Covered Securities:
|
|||
| ACCEPTED: | |||
| ProElite, Inc. | |||
| By: | |||
|
Xxxxxxx
XxXxxx, Chief Executive Officer
|
|||
3
