Exhibit 10.3

 

LOCK-UP AGREEMENT

 

This LOCK-UP AGREEMENT (this “Agreement”) is made and entered into as of
___________, 2017, by and between ActiveCare, Inc. (the “Company”) and the
undersigned Series G Convertible Preferred Stock holder, (the “Holder”). For all
purposes of this Agreement, “Holder” includes any affiliate or controlling
person of Shareholder, and any other agent, representative or other person with
whom Holder is acting in concert.

 

W I T N E S S E T H :

 

WHEREAS, the Company approved the designation rights and preferences and
privileges of it’s Series G Convertible Preferred Stock (the “Series G
Preferred”) on November 1, 2016; and

 

WHEREAS, on_______, 2017, the Company filed the Certificate of Designations,
Preferences and Rights of the Series G Preferred (the “Series G Certificate of
Designations”) with the State of Delaware;

 

WHEREAS, on__________, 2017, the Company issued     shares of its Series G
Preferred to Holder for services rendered;

 

WHEREAS, pursuant to the Series G Certificate of Designations, such shares
automatically convert (“Automatic Conversion”) upon (i) the Company’s receipt of
$50,000,000 or more in gross revenue in a single fiscal year, (ii) the sale of
the Company via asset purchase, stock sale, merger or other business combination
in which the Company and/or its stockholders receive aggregate gross proceeds of
$25,000,000 or more, or (iii) the closing of an underwritten offering (the
“Qualified Offering”) by the Company pursuant to which the Company receives
aggregate gross proceeds of at least Ten Million Dollars (US$10,000,000) in
consideration of the purchase of shares of common stock and/or which results in
the listing of the Company’s common stock on the Nasdaq National Market, the
Nasdaq Capital Market, the New York Stock Exchange, or the NYSE MKT;

 

WHEREAS, the Company and Holder have decided to enter into this Agreement, which
shall restrict the public sale of the Holders shares of common stock upon the
triggering of an Automatic Conversion (the “Lock-Up Securities”), in accordance
with the terms below; and

 

WHEREAS, this Agreement will be in addition to the terms of the lock up
agreement that is required by the underwriter in connection with the Qualified
Offering (the “Underwriter Lock-Up Agreement”) .

 

NOW THEREFORE, for good and valuable consideration, the sufficiency and receipt
of which consideration is hereby acknowledged, the Holder and the Company hereby
agree as follows:

 

1. Lock-Up Period.

 

The Holder agrees that, from the date of an Automatic Conversion until the
earlier of (i) the Company’s receipt of $25,000,000 or more in gross revenue in
a single fiscal year (but in no event prior to twelve (12) months from the date
of the final prospectus with respect to the Qualified Offering, if any, even if
such gross revenue threshold is attained prior to such date), or (ii) eighteen
(18) months from the date thereof (such period, the “Lock-Up Period”), the
Holder shall be subject to the lock-up restrictions set forth in Section 2
below.

 

 

 

 

2. Lock-Up Restriction.

 

(a) Lock-Up. During the Lock-Up Period, the Holder will not offer, sell,
contract to sell, hypothecate or otherwise dispose of (or enter into any
transaction which is designed to, or might reasonably be expected to, result in
the sale, hypothecation or disposition (whether by actual or effective economic
sale, hypothecation or disposition due to cash settlement or otherwise) by the
Holder or any affiliate of the Holder or any person in privity with the Holder
or any affiliate of the Holder), directly or indirectly, including the filing
(or participation in the filing) of a registration statement with the U.S.
Securities and Exchange Commission in respect of, or establish or increase a put
equivalent position or liquidate or decrease a call equivalent position within
the meaning of Section 16 of the Securities Exchange Act of 1934, as amended,
with respect to the Lock-Up Securities, unless such transaction is a Permitted
Disposition (as defined below).

 

A “Permitted Disposition” shall include the following: (a) transfers of Lock-Up
Securities to a trust for the benefit of the undersigned or as a bona fide gift,
by will or intestacy or to a family member or trust for the benefit of a family
member of the undersigned (for purposes of this lock-up agreement, “family
member” means any relationship by blood, marriage or adoption, not more remote
than first cousin); or (b) transfers of Lock-Up Securities to a charity or
educational institution; provided that in the case of any transfer pursuant to
the foregoing clauses (a) or (b), (i) any such transfer shall not involve a
disposition for value, (ii) each transferee shall sign and deliver to the
Company a lock-up agreement substantially in the form of this lock-up agreement
and (iii) no filing under Section 16(a) of the Exchange Act shall be required or
shall be voluntarily made.

 

(b)   Stop Orders. The Holder further agrees that the Company is authorized to
and the Company agrees to place “stop orders” on its books to prevent any
transfer of any Lock-Up Securities of the Company held by the Holder in
violation of this Agreement. The Company agrees not to allow any transaction to
occur that is inconsistent with this Agreement.

 

3. Miscellaneous.

 

(a) At any time, and from time to time, after the signing of this Agreement, the
Holder will execute such additional instruments and take such action as may be
reasonably requested by the Company to carry out the intent and purposes of this
Agreement.

 

(b) This Agreement shall be governed by and construed in accordance with the
laws of the State of Utah without regard to principles of conflicts of laws. Any
action brought by either party against the other concerning the transactions
contemplated by this Agreement shall be brought only in the state courts of Utah
or in the federal courts located in the state of Utah. The parties to this
Agreement hereby irrevocably waive any objection to jurisdiction and venue of
any action instituted hereunder and shall not assert any defense based on lack
of jurisdiction or venue or based on forum non conveniens. The parties executing
this Agreement and any other agreements referred to herein or delivered in
connection herewith agree to submit to the in personam jurisdiction of such
courts and hereby irrevocably waive trial by jury. The prevailing party shall be
entitled to recover from the other party its reasonable attorneys’ fees and
costs. In the event that any provision of this Agreement or any other agreement
delivered in connection herewith is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any such provision which
may prove invalid or unenforceable under any law shall not affect the validity
or enforceability of any other provision of any agreement.

 

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(c) Any and all notices or other communications given under this Agreement shall
be in writing and shall be deemed to have been duly given on (i) the date of
delivery, if delivered in person to the addressee, (ii) the next business day if
sent by overnight courier, or (iii) three (3) days after mailing, if mailed
within the continental United States, postage prepaid, by certified or
registered mail, return receipt requested, to the party entitled to receive
same, at his or its address set forth below:

 

If to the Company:

 

With a copy to (which shall not constitute notice):

 

If to the Holder:

_________________

_________________

Tel No.: _________________

 

(d) The restrictions on transfer described in this Agreement are in addition to
and cumulative with any other restrictions on transfer otherwise agreed to by
the Holder (including the Underwriter Lock-Up Agreement) or to which the Holder
is subject to by applicable law.

 

(e) This Agreement shall be binding upon Holder, its legal representatives,
successors and assigns.

 

(f) This Agreement may be signed in counterparts and delivered by facsimile
signature and delivered electronically.

 

(g) The Company agrees not to take any action or allow any act to be taken which
would be inconsistent with this Agreement.

 

(h) Nothing contained herein shall affect the validity or enforceability of the
Underwriter Lock-Up Agreement which will not be affected by the terms of this
Agreement. To the extent there is any conflict between the terms of this
Agreement and the Underwriter Lock-Up Agreement, the Underwriter Lock-Up
Agreement shall govern.

 

(i) Amendments. No provision of this Agreement may be amended except in a
written instrument signed, by the Company and Holder.  

 

[-signature page follows-]

 

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IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties hereto
have executed this Agreement as of the day and year first above written.

 

  HOLDER:         By:            an individual

 

 

  COMPANY:         ACTIVECARE, INC.         By:     Name:             Title:  

 

 

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