LOCK-UP
AGREEMENT
THIS LOCK-UP AGREEMENT dated __________, 2007
(the “Agreement”), is entered into by and among
Onstream Media Corporation, a Florida corporation
(“Onstream”) and __________________________________
(the “Principal Member,” collectively the "Principal
Members").
W I T N E S S E T H:
WHEREAS, Onstream, the Principal Members,
Infinite Conferencing, LLC (the "Company") and certain other
parties are parties to a Merger Agreement dated ___________, 2007
(the “Merger Agreement”);
WHEREAS, a condition of the Merger Agreement is
the execution of this Agreement;
WHEREAS, the Members own [_________] shares of
Onstream’s common stock (the “Shares”) upon the
Effective Date of the transactions set forth in the Merger
Agreement; and
WHEREAS, under the terms of the Merger Agreement
the Principal Members have agreed to a lock-up of the Shares for an
agreed period commencing on the Effective Date;
NOW, THEREFORE, in consideration of the premises
and the mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
The Members will not without the prior written
consent of Onstream, offer, sell, contract to sell, assign,
transfer, pledge, hypothecate, mortgage, encumber or otherwise
dispose (collectively a “Transfer”) of any of the
Shares commencing at the Effective Date except as provided for
herein. The Shares may only be sold in an aggregate amount of 25%
[________] shares per 90 day period beginning on the trading day
following the trading day that the Shares are registered for resale
pursuant to the terms of the Registration Rights Agreement of even
date hereof between and among the Company and the Principal Members
and each 90 days thereafter for three (3) additional periods (each,
a "Quarterly Distribution"). Notwithstanding the foregoing, if
there is a private sale as contemplated in Section 1(d) below, the
25% limitation shall not apply to such private sale.
In addition, the initial 50% [________] shares
portion of the Shares having a value at the Closing of the Merger
of $2,000,000 (the "Initial Tranche") shall be subject to the
following additional restrictions and rights:
(a) The Principal Members of the Company may sell no
more than an aggregate of 30,000 Shares of the Initial Tranche per
week after such Shares are eligible for resale (which amount may be
increased by Onstream at its option); provided that if the
Principal Members of the Company cannot reasonably effect the sale
of an aggregate of 30,000 Shares for sale in any week, such unsold
amount can be sold in subsequent weeks up to a maximum aggregate
amount of 50,000 Shares per week unless otherwise agreed by
Onstream.
(b) 190 days after the date of the Registration
Statement in respect to the Shares is declared effective (the
"Measurement Period"), the parties shall determine the accumulated
gross proceeds received by the Principal Members from the sale of
the Initial Tranche of the Shares. In the event that the
accumulated gross proceeds of the sale of Initial Tranche of the
Shares is less than $2,000,000, Onstream, at its sole option but
provided that all securities to be issued in connection with the
Merger Agreement and any related financing or other transactions do
not exceed 19.99% of the Company's outstanding Common Stock at the
Effective Date, will pay the difference in cash or registrable
shares of Onstream common stock to the Principal Members of the
Company. If payment is to be made in registered shares of Onstream,
the number of shares shall be determined based upon the average
closing price of Onstream's common stock for the thirty (30)
trading days prior to the end of the Measurement Period. In the
event at the end of any Measurement Period, the Principal Members
choose not to sell any or all of such Initial Tranche of Shares,
the value of such unsold Initial Tranche of Shares based on the
average closing price of Onstream's common stock for period
beginning on the date such shares were first authorized for resale
(either under the schedule established in this Lock-Up Agreement or
under such accelerated schedule that may be subsequently authorized
and/or required by Onstream at its sole option) and ending on the
end of the applicable Measurement Period, will be credited toward
accumulated gross proceeds for valuation purposes; provided, that
in the event that the Principal Members of the Company were
prevented from selling any such Initial Tranche of Shares due to
(i) the ineffectiveness of the Registration Statement covering the
resale of such Shares; (ii) trading in a Common Stock of Onstream
was suspended for any reason for consecutive trading days exceeding
five (5) consecutive trading days during the M
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