LOCK-UP AGREEMENT
THIS
AGREEMENT (this “Agreement”) is dated as of October 7,
2009 by and between Orient Paper, Inc., a Nevada corporation (the
“Company”), and Zhenyong Liu
(“Shareholder”).
WHEREAS,
the Company entered into a Securities Purchase Agreement with the
investors listed in the Schedule of Buyers attached thereto
(individually, a “ Buyer ” and collectively, the
“ Buyers ”) whereby the Company will sell to the
Buyers an aggregate of 8,333,332 shares of the Company’s
common stock, par value $0.001 per share (“ Common
Stock ”), for a total aggregate purchase price of
approximately $5,000,000 in a private placement financing
transaction (the “ Financing Transaction
”).
WHEREAS,
Shareholder wishes to induce the Company and the Buyers to enter
into the Financing Transaction.
WHEREAS,
in order to induce the Company and the Buyers to enter into the
Financing Transaction pursuant to the Securities Purchase Agreement
dated October 7, 2009 by and among the Company and the Buyers (the
“Securities Purchase Agreement”), Shareholder has
agreed not to sell any shares of the Company’s Common Stock
that Shareholder presently owns or may acquire after the date
hereof, except in accordance with the terms and conditions set
forth herein (collectively, the “ Lock-Up Shares
”). Capitalized terms used herein without definition shall
have the meanings assigned to such terms in the Securities Purchase
Agreement.
NOW,
THEREFORE, in consideration of the covenants and conditions
hereinafter contained, the parties hereto agree as
follows:
1.
Restriction on Transfer; Term . The Shareholder hereby
agrees with the Company that such Shareholder will not offer, sell,
contract to sell, assign, transfer, hypothecate, pledge or grant a
security interest in, or otherwise dispose of, or enter into any
transaction which is designed to, or might reasonably be expected
to, result in the disposition of (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise,
directly or indirectly) (each, a “transfer”), any of
the Lock-Up Shares and shall not transfer such shares until a date
that is twelve (12) months following the Closing Date under the
Securities Purchase Agreement (the “Period”), unless
(i) the Buyers, who are holders of at least 75% of the shares of
Common Stock purchased under the Securities Purchase Agreement at
the time of the purported transfer within the Period, consent to
the same, such consent not to be unreasonably withheld, or (ii) all
or any part of such Lock-Up Shares are transferred pursuant to that
Make Good Securities Escrow Agreement of even date herewith entered
into between the Company, the Shareholder and the
Buyers.
2.
Ownership . During the Period, Shareholder shall retain all
rights of ownership in the Lock-Up Shares, including, without
limitation, voting rights and the right to receive any dividends
that may be declared in respect thereof, except regarding any
Lock-Up Shares transferred pursuant to the Make Good Securities
Escrow Agreement.
3.
Company and Transfer Agent . The Company is hereby
authorized to disclose the existence of this Agreement to its
transfer agent. The Company and its transfer agent are hereby
authorized to decline to make any transfer of the Common Stock if
such transfer would constitute a violation or breach of this
Agreement and/or the Securities Purchase Agreement.
4.
Notices . All notices, demands, consents, requests,
instructions and other communications to be given or delivered or
permitted under or by reason of the provisions of this Agreement or
in connection with the transactions contemplated hereby shall be in
writing and shall be deemed to be delivered and received by the
intended recipient as follows: (i) if personally delivered, on the
business day of such delivery (as evidenced by the receipt of the
personal delivery service), (ii) if mailed certified or registered
mail return receipt requested, two (2) business days after being
mailed, (iii)
