DIGITAL RIVER, INC.
LOCKUP AGREEMENT
July 14, 1998
BT Alex. Xxxxx Incorporated
BancAmerica Xxxxxxxxx Xxxxxxxx
Bear, Xxxxxxx & Co. Inc.
c/o BT Alex. Xxxxx Incorporated
0 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
The undersigned understands that BT Alex. Xxxxx Incorporated,
BancAmerica Xxxxxxxxx Xxxxxxxx and Bear, Xxxxxxx & Co. Inc, as
representatives (the "Representatives") of the several underwriters (the
"Underwriters"), propose to enter into an Underwriting Agreement (the
"Underwriting Agreement") among Digital River, Inc. (the "Company") and the
Underwriters, providing for the initial public offering (the "Initial Public
Offering") by the Underwriters, including the Representatives, of shares of
common stock (the "Common Stock") of the Company pursuant to a registration
statement to be filed with the Securities and Exchange Commission (the
"Commission").
In consideration of the agreement by the Underwriters to offer and sell
the Company's Common Stock pursuant to the Underwriting Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the undersigned agrees that, without the prior
written consent of BT Alex. Xxxxx Incorporated, the undersigned will not,
directly or indirectly, offer, sell, pledge, contract to sell, grant any
option to purchase, grant a security interest in, hypothecate or otherwise
sell or dispose of any Common Stock of the Company or common stock of Tech
Squared, Inc. ("Tech Squared Stock") (including, without limitation, shares
of Common Stock or Tech Squared Stock that may be deemed to be beneficially
owned by the undersigned in accordance with the rules and regulations of the
Commission and shares of Common Stock or Tech Squared Stock that may be
issued upon the exercise of a stock option or warrant) or any securities
convertible into, derivative of or exercisable or exchangeable for or any
rights to purchase or acquire Common Stock or Tech Squared Stock, owned
directly by the undersigned or with respect to which the undersigned has the
power of disposition, in any such case whether now owned or hereafter
acquired (other than Common Stock purchased in the open market and not
otherwise in breach of this Lockup Agreement) (collectively, the "Shares")
during the period commencing on the date of this Lockup Agreement and ending
on the close of business on the one hundred eightieth (180th) day after the
date of the Prospectus (as such term is defined in the Underwriting
Agreement).
Notwithstanding the foregoing, (i) the undersigned may transfer any or
all of the Shares either during his lifetime or upon death, by gift, will or
intestacy, to his immediate family or to a trust the beneficiaries of which
are exclusively the undersigned and/or a member or members of his immediate
family; PROVIDED, HOWEVER, that in any such case it shall be a condition to
the transfer that the transferee execute an agreement stating that the
transferee is receiving and holding the Shares subject to the provisions of
this Lockup Agreement, and there shall be no further transfer of such Shares
except in accordance with this Lockup Agreement; (ii) if the undersigned has
received stock options under the Company's stock option plan, he may deliver
Common Stock of the Company to the Company as payment for the exercise of the
options as prescribed under the stock option plan; or (iii) the undersigned
may offer, sell, pledge, contract to sell, grant any option to purchase,
grant a security interest in, hypothecate or otherwise sell or dispose of up
to an aggregate of 400,000 shares of Tech Squared Stock on or after the day
following the ninetieth (90(th)) day after the date of the Prospectus (as such
term is defined in the Underwriting Agreement).
In addition, the undersigned agrees that the Company and/or Tech
Squared, Inc. will, with respect to any Shares for which the undersigned is
the record holder, cause the transfer agent for the Company and/or Tech
Squared, Inc. to note stop transfer instructions with respect to such Shares
on the transfer books and records of the Company and/or Tech Squared, Inc.
The undersigned understands that the Company and the Underwriters will
proceed toward the proposed Initial Public Offering in reliance upon this Lockup
Agreement. If the effective date of the Registration Statement
(as such term is defined in the Underwriting Agreement) has not occurred on
or before November 30, 1998, then this Lockup Agreement shall be null and
void.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Lockup Agreement. All authority
herein conferred or agreed to be conferred shall survive the death or incapacity
of the undersigned and any obligations of the undersigned shall be binding upon
the heirs, personal representatives, successors and assigns of the undersigned.
This Lockup Agreement supersedes in its entirety the Lockup Agreement
executed by the undersigned dated June 5, 1998.
Very truly yours,
/s/ Xxxx X. Xxxxxxx
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Signature
Xxxx X. Xxxxxxx
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Please Print Name
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Please Print Title, if applicable
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Additional Signature(s), if stock jointly held
The undersigned understands that the Company and the Underwriters will
proceed toward the proposed Initial Public Offering in reliance upon this Lockup
Agreement and agrees to impose stop transfer instructions with respect to such
Shares on the transfer books and records of Tech Squared, Inc. in the event of
any breach of this Lockup Agreement.
TECH SQUARED, INC.
July 14, 1998
/s/ Xxxxxxx X. Apple
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Signature
Xxxxxxx X. Apple
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Please Print Name
Chief Executive Officer
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Please Print Title