EXHIBIT
2.3
PROCERA NETWORKS,
INC.
LOCK UP
AGREEMENT
This LOCK UP
AGREEMENT ( the " Agreement
”) dated as of September 29, 2006, is by and among the
shareholders set forth on the signature page hereto who hold forty
nine percent (49%) of the securities of Netintact PTY LTD,
Australian Company Number 103 004 744AB, (each a “
Seller ” and collectively referred to as
“ Sellers ”); and Procera Networks,
Inc., a Nevada corporation, (“ Procera
”).
RECITAL
WHEREAS , as of the date hereof, Procera and Sellers of
Netintact PTY LTD, Australian Company Number 103 004 744AB
(“ Netintact ”) have entered into that
certain Exchange Agreement by and among Procera and Sellers (the
Exchange Agreement ”);
WHEREAS , the obligations in the Exchange Agreement are
conditioned upon the execution and delivery of this Agreement;
and
WHEREAS , in connection with the consummation of the
Exchange Agreement, Procera, and Sellers have agreed to restrict
the transfer of Sellers shares of capital stock issued as set forth
below.
AGREEMENT
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Lock
Up . In
connection with the execution and delivery of the Exchange
Agreement each Seller hereby agrees that he shall not sell, offer,
pledge, contract to sell, make any short sale of, grant any option
for the purchase of, or enter into any hedging or similar
transaction with the same economic effect as a sale, or otherwise
transfer or dispose of, directly or indirectly (collectively,
“ Transfer ”), any common stock (or
other securities) of Procera owned by Seller, as of the Closing
Date of the Exchange Agreement (“ Sellers’
Securities ”).
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2.
Exceptions to Lock Up . Notwithstanding the foregoing, each Seller may
Transfer up to 33.33% of Seller’s Securities on each of the
first three anniversaries of the Closing Date of the Exchange
Agreement year (i.e. after two (2) years 66.66% of the
Sellers’ Securities, and after three (3) years all
Sellers’ Securities, subject to securities compliance, shall
be released from the obligations of this Agreement). Furthermore,
upon a Change of Control (as defined below) of the Company, this
Agreement shall terminate and be of no further force and effect.
“ Change of Control ” shall be defined
as (i) a sale of equity securities of the Company (other than in a
public offering) in one transaction or series of related
transactions representing more than fifty percent (50%) of the
issued and outstanding shares of the Company; or (ii) a sale of
substantially all of the Company’s assets.
3. Stock
Transfer Instructions . Each Seller also agrees and consents to the
entry of stop transfer instructions with Procera’s transfer
agent and registrar against the transfer of the Sellers’
Securities except in compliance with the foregoing restrictions. It
is understood that this Agreement shall become effective only upon
execution and delivery of the Exchange Agreement and shall be void
and of no further force or effect if the Exchange Agreement is
terminated.
4.
Legend. Concurrently
with the execution of this Agreement, there shall be imprinted or
otherwise placed, on certificates representing the Sellers’
Securities, the following restrictive legend (the “
Legend ”):
“THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND
CONDITIONS OF A LOCK UP AGREEMENT WHICH PLACES CERTAIN RESTRICTIONS
ON THE TRANSFER OF THE SHARES REPRESENTED HEREBY. ANY PERSON
ACCEPTING ANY INTEREST IN SUCH SHARES SHALL BE DEEMED TO AGREE TO
AND SHALL BECOME BOUND BY ALL THE PROVISIONS OF SUCH AGREEMENT. A
COPY OF SUCH TRANSFER AGREEMENT WILL BE FURNISHED TO THE RECORD
HOLDER OF THIS CERTIFICATE WITHOUT CHARGE UPON WRITTEN REQUEST TO
THE COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS.”
Each Seller
agrees that, during the term of this Agreement, Seller will not
remove, and will not permit to be removed (upon registration of
transfer, reissuance of otherwise),
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