EXHIBIT 10.3
LOCK-UP AGREEMENT
THIS LOCK-UP AGREEMENT
(this “ Agreement
”) is made and entered into as of May 12, 2004, by and among
RITA Medical Systems, Inc., a Delaware corporation (“
Parent ”), Horizon Medical Products, Inc., a Georgia
corporation (the “ Company ”), and the
undersigned shareholder of the Company (“ Holder
”). Capitalized terms used but not otherwise defined herein
shall have the meanings ascribed to them in the Merger Agreement
(as defined below).
BACKGROUND
A. Parent, the Company and Hornet
Acquisition Corp., a Delaware corporation and wholly owned
subsidiary of Parent (“ Merger Sub ”), have
entered into an Agreement and Plan of Merger, dated as of the date
hereof (the “ Merger Agreement ”), which
provides for the merger of the Merger Sub with and into the Company
(the “ Merger ”), pursuant to which the Company
shall become a wholly-owned subsidiary of Parent.
B. Holder has been advised that
Holder may be deemed to be an “affiliate” of Parent
after the consummation of the Merger as the term
“affiliate” is defined in Rule 144 of the Rules and
Regulations (the “ Rules and Regulations ”) of
the Securities and Exchange Commission (the “
Commission ”), although nothing contained herein shall
be construed as an admission by Holder that Holder will in fact be
an “affiliate” of Parent after the consummation of the
Merger.
C. As a condition and inducement to
the willingness of Parent, Merger Sub and the Company to enter into
the Merger Agreement, Holder has agreed to enter into this
Agreement.
NOW, THEREFORE,
intending to be legally bound, the
parties hereto agree as follows:
1. Acknowledgments by Holder
. Holder has carefully read this Agreement and the Merger Agreement
and has had the opportunity to discuss the requirements of this
Agreement with Holder’s professional advisors, who Holder
believes are qualified to advise Holder with regard to such
matters.
2. Affiliate Status;
Lock-up.
(a) Affiliate Status . Holder
has been advised that (i) the issuance of Parent Common Stock to
Holder Company Shareholders in connection with the Merger will be
registered on a registration statement on Form S-4 promulgated
under the Securities Act of 1933, as amended (the “ 1933
Act ”) and that the resale by Holder of shares of Parent
Common Stock issued to the undersigned in the Merger will be
registered under the 1933 Act on a post-effective amendment to such
registration statement on Form S-3 (the “ Resale
Registration Statement ”), (ii) the resale of such shares
by Holder may be subject to restrictions set forth in Rule 144 and
Rule 145 of the Rules and Regulations, and (iii) Holder may be
deemed to be an affiliate of Parent after the consummation of the
Merger.
(b) Lock-up . Holder agrees,
during the 12-month period beginning on the date of the
consummation of the Merger, not to offer, contract to sell or
otherwise sell, dispose of, loan, pledge, grant any rights with
respect to, 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 (each, a
“Disposition”) of any shares of Parent Common Stock,
except to the extent that: (A)(i) such Disposition is made in
conformity with the requirements of Rule 145(d) promulgated under
the 1933 Act, to the extent such Rule may be applicable to such
Disposition, (ii) such Disposition is made pursuant to an effective
registration statement under the 1933 Act or an appropriate
exemption from registration or (iii) Holder delivers to Parent a
written opinion of counsel, reasonably acceptable to Parent in form
and substance, that such Disposition is otherwise exempt from
registration under the 1933 Act; and (B) the number of shares of
Parent Common Stock subject to Dispositions made by Holder during
the three month-period ending on
the date of any such Disposition (and including
the shares of Parent Common Stock subject to such Disposition) does
not exceed 200% of the number of shares of Parent Common Stock
Holder would be entitled to sell in accordance with the volume
limitations set forth in Rule 144(e)(1) of the Rules and
Regulations if all shares of Parent Common Stock subject to
Dispositions made by Holder during such three-month period were
subject to such volume limitations (regardless of whether the
resale thereof has been registered under the 1933 Act).
Notwithstanding anything to the contrary herein, this Agreement
shall not prohibit a transfer of any shares of Parent Common Stock
by Holder, if Holder is a partnership or limited liability company,
to one or more partners or members of Holder or to an affiliated
Person under common control with Holder; provided, however, that
unless such transfer is effected in accordance with Section 2(b)(B)
above, such transfer shall be permitted only if, as a precondition
to such transfer, the transferee agrees in writing to be bound by
all of the terms of this Section 2(b).
(c) Holder understands that there
will be placed on the certificates for the Parent Common Stock
issued to Holder, or any substitutions therefor, a legend stating
in substance:
“THE SHARES REPRESENTED BY
THIS CERTIFICATE ARE HELD BY AN “AFFILIATE” OF RITA
MEDICAL SYSTEMS, INC. AND MAY ONLY BE TRANSFERRED IN ACCORDANCE
WITH RULE 144 UNDER THE SECURITIES ACT OF 1933, AND WERE ISSUED IN
A TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES
ACT OF 1933 APPLIES. THE SHARES
