EXHIBIT 10.4
FORM OF UNIT OFFERING LOCK-UP AGREEMENT
January __, 2007
Ladies and Gentlemen:
The undersigned is a director, executive officer or beneficial owner of
shares of capital stock, or securities convertible into or exercisable or
exchangeable for the capital stock (each, a "Company Security") of Towerstream
Corporation, a Delaware corporation (the "Company"). The undersigned understands
that the Company will merge with a wholly-owned subsidiary of a publicly traded
company (the "Parent"), concurrently with a private placement by the Parent of
up to 100 units (the "Units") of the Parent, each Unit consisting of 50,000
shares of common stock, par value $0.001 per share, of the Parent and a
detachable transferable warrant to purchase 25,000 shares of common stock of the
Parent at an exercise price of $4.50 per share (the "Funding Transaction"). The
undersigned also understands that WFG Investments, Inc., Granite Financial
Group, LLC, Ardent Advisors and Palladium Capital Advisors, LLC have acted as
placement agents with respect to the Funding Transaction (the "Placement
Agents"). The undersigned understands that the Company, the Parent and the
Placement Agents will proceed with the Funding Transaction in reliance on this
agreement.
In recognition of the benefit that the Funding Transaction will confer upon
the undersigned, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned agrees, for the
benefit of the Company, the Parent, the Placement Agents and each investor in
the Funding Transaction, that, during the period beginning on the initial
closing of the Funding Transaction (the "Closing Date") and ending twelve (12)
months after such date, the undersigned will not, without the prior written
consent of the Placement Agents, directly or indirectly, (i) offer, sell, offer
to sell, contract to sell, hedge, pledge, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase or sell (or announce any offer, sale, offer of sale,
contract of sale, hedge, pledge, sale of any option or contract to purchase,
purchase of any option or contract of sale, grant of any option, right or
warrant to purchase or other sale or disposition), or otherwise transfer or
dispose of (or enter into any transaction or device that is designed to, or
could be expected to, result in the disposition by any person at any time in the
future), any Company Security or securities of the Parent into or for which a
Company Security may be converted, exercised or exchanged, whether by operation
of law or otherwise (each, a "Parent Security"), beneficially owned, within the
meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), by the undersigned on the date hereof or hereafter acquired or
(ii) enter into any swap or other agreement or any transaction that transfers,
in whole or in part, directly or indirectly, the economic consequence of
ownership of any Company Security or Parent Security, whether any such swap or
transaction described in clause (i) or (ii) above is to be settled by delivery
of any Company Security or Parent Security.
The undersigned further agrees that the undersigned will not for so long as
the lock-up in the immediately preceding paragraph shall be in effect, without
the prior written consent of the
Parent and the managing underwriter (if a managing or lead underwriter is
appointed), during the period commencing on the date of the final prospectus
relating to the initial underwritten public offering of the Parent and ending on
the date specified by the Parent and the managing underwriter (such period not
to exceed one hundred eighty (180) calendar days) (i) lend, offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, or
otherwise transfer or dispose of, directly or indirectly, any securities of the
Parent, including (without limitation) shares of common stock of Parent or any
securities convertible into or exercisable or exchangeable for shares of Parent
common stock (whether now owned or hereafter acquired) or (ii) enter into any
swap or other arrangement that transfers to another, in whole or in part, any of
the economic consequences of ownership of any securities of the Parent,
including (without limitation) shares of Parent common stock or any securities
convertible into or exercisable or exchangeable for shares of Parent common
stock (whether now owned or hereafter acquired), whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of
securities, in cash or otherwise.
In furtherance of the foregoing, the Company, the Parent and the transfer
agent of each are hereby authorized to decline to make any transfer of any
Company Security or Parent Security if such transfer would constitute a
violation or breach of this agreement.
Notwithstanding the foregoing, the undersigned (and any transferee of the
undersigned) may transfer any shares of a Company Security or a Parent Security
(i) as a bona fide gift or gifts, provided that prior to such transfer the donee
or donees thereof agree in writing to be bound by the restrictions set forth
herein, (ii) to any trust, partnership, corporation or other entity formed for
the direct or indirect benefit of the undersigned or the immediate family of the
undersigned, provided that prior to such transfer a duly authorized officer,
representative or trustee of such transferee agrees in writing to be bound by
the restrictions set forth herein, and provided further that any such transfer
shall not involve a disposition for value, (iii) to non-profit organizations
qualified as charitable organizations under Section 501(c)(3) of the Internal
Revenue Code of 1986, as amended, or (iv) if such transfer occurs by operation
of law, such as rules of descent and distribution, statutes governing the
effects of a merger or a qualified domestic order, provided that prior to such
transfer the transferee executes an agreement stating that the transferee is
receiving and holding any Company Security or Parent Security subject to the
provisions of this agreement. For purposes hereof, "immediate family" shall mean
any relationship by blood, marriage or adoption, not more remote than first
cousin. In addition, the foregoing shall not prohibit privately negotiated
transactions, provided the transferees agree, in writing, to be bound to the
terms of the lock-up agreements for the balance of the lock-up period.
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The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this agreement and that, upon request,
the undersigned will execute any additional documents necessary or desirable in
connection with the enforcement hereof. Any obligations of the undersigned shall
be binding upon the heirs, personal representatives, successors and assigns of
the undersigned.
Very truly yours,
Signature:
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Print Name:
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Date: January ___, 2007
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