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LOCK-UP AGREEMENT
July 5, 1999
Unitrend, Inc.
0000 X. Xxxxxxxx
Xxxxxx, Xxxx 00000
Ladies and Gentlemen:
The Undersigned understands that Unitrend, Inc., a Nevada corporation,
(the "Company") intends to provide for public offering of shares of common stock
of the Company (the "Securities") pursuant to a Registration Statement on Form
S-1 (the "Registration Statement") to be filed with the Securities and Exchange
Commission.
In consideration of the Company's efforts to offer and sell the
Securities pursuant to the public offering, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Undersigned agrees that he will not, directly or indirectly, sell, offer to
sell, contract to sell, grant any option for the sale of, grant any security
interest in, pledge, margin, hypothecate, or otherwise sell, convey or dispose
of the following shares of the Company's common stock (the "Locked-Up Shares")
or any other Restricted Securities during the Lock-Up Period:
Five hundred thousand (500,000) presently-uncertificated shares,
subject to all stock splits
The "Lock-Up Period" shall be the period beginning on the date hereof
and ending at the earliest of:
(i) the date that Xx. Xxxxxx X.X. Xxxxxxxx can publicly sell all or a
portion of his shares; or
(ii) 10 months following the effective date of the Prospectus relating
to the public offering of the Securities.
The "Locked-Up Shares" shall include any securities convertible into or
exchangeable for the Locked-Up Shares, or any interest in such securities or
rights, owned directly by the Undersigned or with respect to which the
Undersigned has the power of disposition, at any time prior to the effective
date of the Registration Statement.
The "Restricted Securities" shall be any of the Company's common stock (the
"Common Stock"), or any options or warrants to purchase any Common Stock, or any
securities convertible into or exchangeable for Common Stock, or any interest in
such securities or rights, 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 at any time prior to the effective date of the
Registration Statement, except any subsequently acquired Restricted Securities
that are otherwise subject to lock-up restrictions shall be subject to such
restrictions.
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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 any of the Restricted Securities held by the Undersigned. The
Company's Board may in its absolute discretion without notice, release all or
any portion of the securities subject to this Lock-Up Agreement or any similar
agreement executed by any other security holder, and if the Company's Board
releases any securities of any other security holder, securities of the
Undersigned shall not be entitled to release from this Lock-Up Agreement.
In the event that the Undersigned owns no Common Stock of the Company
at the date hereof or prior to the Effective Date, but has the right to acquire
Common Stock of the Company pursuant to options or warrants, and if the
Undersigned exercises such options or warrants prior to the expiration of the
Lock-Up Period commencing on the Effective Date, he agrees that the Common Stock
purchased on such exercise of options or warrants will be subject to the terms
of this Lock-Up Agreement for the remaining portion of such Lock-Up Period. In
addition, the Undersigned agrees that he will not convey, sell, pledge, margin,
hypothecate or otherwise dispose of such Common Stock pursuant to the exemption
afforded by Rule 701 under the Securities Act of 1933, as amended, during such
Lock-Up Period without the prior written consent of the Company's Board.
The Undersigned further agrees that he shall not enter into any swap or
other arrangement that transfers or conveys all or a portion of the economic
consequences associated with the ownership of any Common Stock owned by the
Undersigned at the date hereof, or that the Undersigned obtains ownership of
during the Lock-Up Period (regardless of whether any of the transactions are to
be settled by the delivery of Common Stock, other securities, cash or
otherwise), for the Lock-Up Period without the prior written consent of the
Company's Board.
In the event Undersigned desires or is directed to transfer, convey, or
otherwise dispose of all or any part of his shares in the Company during the
Lock-Up Period he shall deliver written notice of such desire or direction to
the Company's Board, specifying the number of shares he desires or is directed
to dispose of. On receipt of such notice, the Company, in the Board's absolute
discretion, may preemptively buy, and the Undersigned shall sell to the Company
the number of shares set forth in the notice on the terms set forth in this
paragraph. On the death of Undersigned during the Lock-Up Period, the Company
shall buy, and the executor, administrator, or personal representative of the
Undersigned will sell to the Company, all of the shares owned by the Undersigned
at the time of his death at the price and on the terms set forth in this
paragraph. The purchase price shall be two cents ($.02) per share, subject to
all stock splits. It is understood that the purchase price, determined as set
forth above, shall be the Undersigned's basis and value of the purchased shares
for all tax purposes. In the event such value is later increased by any federal
or state taxing authority, any tax liability resulting from such increase shall
be borne by the Undersigned, or his executor, administrator, or personal
representative or as the case may be.
The Undersigned further agrees that all of the rights, authority and
preemptive provisions granted to the Company's Board pursuant to this Lock-Up
Agreement may be transferred by the Company's Board to any NASD member firm that
participates in the proposed public offering of the Company's securities.
Certificates for all certificated shares transferred according to this
Agreement, shall be delivered to the receiving party by the transferring party
not later than 15 days after the record
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date of the transfer. Then the transferring party, or his estate, shall cease to
be a shareholder of the Company with respect to such shares.
Any notice required to be given pursuant to this Agreement shall be
sent, and shall be considered to have been delivered on the date when sent by
prepaid United States registered or certified mail, return receipt requested,
properly addressed to the party to receive it, as follows: Notices to be sent to
the Company shall be addressed to it at 0000 X. Xxxxxxxx, Xxxxxx, Xxxx 00000,
attention of the President: Notices to be sent to the Undersigned shall be sent
to him at his address as shown on the Company's stock records unless a different
address has been designated in writing.
This Agreement shall bind and, unless inconsistent with its provisions,
shall insure to the benefit of the executor, administrator, or personal
representative, and the heirs and assigns of the Undersigned.
This Agreement is executed and is to be performed in Ohio, and shall be
governed by and construed in accordance with the laws of the State of Ohio.
The Undersigned understands that the Company will undertake the public
offering in reliance upon this Lock-Up Agreement.
Very truly yours,
/s/ Xxxx X. Xxxxxxxx
Xxxx X. Xxxxxxxx
Approved by Unitrend, Inc.:
By: /s/ Xxxxxx X.X. Jelinger
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President
