LOCKUP AGREEMENT

THIS LOCKUP AGREEMENT (the “Agreement”) is made as of September 29, 2011 by IM
Ready-Made LLC, a New York limited liability company (“Holder”) in connection
with the ownership of shares of NetFabric Holdings, Inc., a Delaware corporation
(the “Company”). Capital terms used and not otherwise defined herein shall have
the respective meanings set forth in the Asset Purchase Agreement by and among
Xcel Brands, Inc., IM Brands LLC, and IM Ready-Made LLC, dated as of May 19,
2011 as amended, and its attachments thereto (the “Purchase Agreement”).

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

1. 
Background.

 
a.             On May 19, 2011, XCel Brands, Inc., a Delaware corporation
(‘‘XCel’’) and its wholly owned subsidiary, IM Brands, LLC entered into the
Purchase Agreement with Holder, pursuant to which the Buyers acquired certain
assets of Holder (the “Assets”), including (i) the “Isaac Mizrahi” brands
(including the trademarks “Isaac Mizrahi New York,” “Isaac Mizrahi” and “Isaac
MizrahiLIVE”) (the “IM Trademarks”), (ii) the license agreements between Holder
and third parties related to the IM Trademarks, (iii) design agreements with Liz
Claiborne and QVC, Inc. to design the “Liz Claiborne New York” brand for sale
exclusively at QVC, and (iv) computers, design software, and other assets
related to the licensing and design of the IM Trademarks and the design of the
Liz Claiborne New York brand.
 
b.             On September 29, 2011, the Company, XCel, and NetFabric
Acquisition Corp., a Delaware corporation (‘‘Acquisition Corp.’’) and
wholly-owned subsidiary of the Company, entered into an Agreement of Merger and
Plan of Reorganization (the ‘‘Merger Agreement’’) pursuant to which Acquisition
Corp. was merged with and into XCel, with XCel surviving as a wholly-owned
subsidiary of the Company (the ‘‘Merger’’). The closing of the Purchase
Agreement occurred in conjunction with the consummation of the Merger.
 
c.             Simultaneous with the Purchase Agreement and the Merger, the
Company is conducting a private offering (the “Offering”) to certain accredited
investors (the “Investors”) consisting of a minimum of $2,500,000 up to a
maximum of $4,000,000 of investment units, each consisting of one hundred
thousand (100,000) shares of the Company’s common stock (the “Common Stock”),
$0.001 par value, and one warrant to purchase fifty thousand (50,000) shares of
Common Stock, at a per unit purchase price of $500,000, pursuant to Section 4(2)
of the Securities Act of 1933, as amended (the “Securities Act”) and Rule 506
promulgated under Regulation D thereunder in accordance with the rules and
regulations of the United States Securities and Exchange Commission.
 
d.            As partial consideration for the Assets, Holder is being issued
2,759,000 shares of Common Stock, par value $.001 pursuant to Section 3.3(iv) of
the Purchase Agreement (the “Initial Stock Consideration”), and may acquire
additional shares in the future pursuant to the Purchase Agreement, including
the Earn-Out Shares, QVC Earn-Out Shares and Note Shares (the “Additional Stock
Consideration”) (collectively the Initial Stock Consideration and the Additional
Stock Consideration, but excluding the Excluded Shares (as defined below), are
referred to as the “Lockup Shares”).
 
 

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e.             As a condition to the Purchase Agreement pursuant to Section 6.15
and as an inducement to the Investors to participate in the Offering, Holder has
agreed to refrain from selling any of the Lockup Shares pursuant to the terms
set forth in Section 2 herein other than up to 1,200,000 of the shares which
constitute Initial Stock Consideration which may be transferred free of any
restrictions on transfer under this Agreement (the “Excluded Shares”).
 
f.             As an inducement to the Investors to participate in the Offering,
Holder has agreed to refrain from including any Lockup Shares other than the
Excluded Shares in the registration statement (the “Registration Statement”) to
be filed by the Company with the Securities and Exchange Commission to register
for resale securities issued or issuable to the Investors of the Offering.
 
g.             As an inducement to the Holder to enter into this Agreement and
consummate the transactions contemplated by the Purchase Agreement, the Company
has agreed to include the Excluded Shares in the Registration Statement.
 
2. 
Sale Restriction.

 
a.             Initial Stock Consideration.  Holder hereby agrees that during
the six (6) months from the date hereof, in the case of the Initial Stock
Consideration (other than the Excluded Shares), including any shares of Common
Stock acquired pursuant to a stock split, stock dividend, reverse stock split,
subdivision, combination, reclassification or similar change in the capital
structure of the Company (each an “Adjustment”) (such period herein referred to
as the “Initial Period”), Holder shall not, directly or indirectly, through an
“affiliate” or “associate” (as such terms are defined in the General Rules and
Regulations under the Securities Act), or otherwise, offer, sell, contract to
sell, pledge, hypothecate, grant an option for sale, or otherwise dispose of, or
transfer or grant any rights with respect thereto in any manner (or enter into
any transaction which is designed to, or might reasonably be expected to, result
in the disposition, whether by actual disposition, effective economic
disposition due to cash settlement, transfer of the entity holding the Lockup
Shares or otherwise) either privately or publicly (each, a “Transfer”) any of
the Initial Stock Consideration (other than the Excluded Shares), or enter into
any agreement or any transaction that has the effect of transferring, in whole
or in part, directly or indirectly, the economic consequence of ownership of the
Initial Stock Consideration whether any such agreement or transaction is to be
settled by delivery of the Lockup Shares, other than in connection with an offer
made to all shareholders of the Company in connection with merger, consolidation
or similar transaction involving the Company. Holder further agrees that the
Company and its transfer agent are authorized to place “stop orders” on its
books to prevent any transfer of any of the Initial Stock Consideration (other
than the Excluded Shares) held by Holder in violation of this Agreement.  
 
 

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b.            Additional Stock Consideration.
 
i           Holder hereby further agrees that during the twelve (12) month
period from the respective date on which any Additional Stock Consideration is
issued (each such twelve month period herein referred to as an “Additional
Lockup Period” and any issuance of Additional Stock Consideration is referred to
as an “Additional Stock Issuance”), including any shares of Common Stock
acquired pursuant to an Adjustment, Holder shall not, directly or indirectly,
through an “affiliate” or “associate” (as such terms are defined in the General
Rules and Regulations under the Securities Act), or otherwise, Transfer any of
the Additional Stock Consideration, or enter into any agreement or any
transaction that has the effect of transferring, in whole or in part, directly
or indirectly, the economic consequence of ownership of the Additional Stock
Consideration, whether any such agreement or transaction is to be settled by
delivery of the Lockup Shares, other than in connection with an offer made to
all shareholders of the Company in connection with merger, consolidation or
similar transaction involving the Company. Holder further agrees that the
Company and its transfer agent are authorized to place “stop orders” on its
books to prevent any transfer of the Additional Stock Consideration held by
Holder in violation of this Agreement.  
 
ii          Upon the expiration of an Additional Lockup Period, the foregoing
restrictions on Transfer set forth in Section 2(a) shall lapse with respect to
25% of the Additional Stock Consideration as to which such Additional Stock
Issuance relates (in each case taking into account and proportionally adjusting
for any Adjustments occurring during such period), and the Holder may Transfer
such shares without restriction subject to applicable federal securities
laws.  Additionally, on the first day of each of the first three consecutive
three month periods following the end of an Additional Lockup Period, the
restrictions on Transfer provided for in Section 2(a) shall lapse with respect
to an additional 25% of the Additional Stock Consideration as to which such
Additional Stock Issuance relates (in each case taking into account and
proportionally adjusting for any Adjustments occurring during such period), and
the Holder may Transfer such shares without restriction subject to applicable
federal securities laws.
 
c.            Notwithstanding the foregoing restrictions on transfer, the Holder
may, at any time and from time to time during the Initial Period or otherwise,
transfer the Lockup Shares (i) as bona fide gifts or transfers by will or
intestacy, (ii) to any trust for the direct or indirect benefit of the
undersigned or the immediate family of the Holder, provided that any such
transfer shall not involve a disposition for value, (iii) to a partnership which
is the general partner of a partnership of which the Holder is a general
partner, or (iv) to the Holder’s members, provided, that, in the case of any
gift or transfer described in clauses (i), (ii), (iii) or (iv), each donee or
transferee agrees in writing to be bound by the terms and conditions contained
herein in the same manner as such terms and conditions apply to the undersigned,
and provided that any sales by such done or transferee shall be aggregated with
any sales of the Holder for purposes of complying with the restriction set forth
in Section 2(c)(ii) herein. For purposes hereof, “immediate family” means any
relationship by blood, marriage or adoption, not more remote than first
cousin.  Notwithstanding anything to the contrary, the Excluded Shares shall not
be subject to any of the restrictions set forth in this Section 2.
 
d.             In the event that any shares of Common Stock owned, held or
controlled by any of the officers or directors of the Company are released from
any of the restrictions set forth in their applicable lockup agreements, then a
pro rata amount (with such amount calculated based on the aggregate amount of
the Initial Stock Consideration owned by the Holder and/or its members in
relation to the aggregate amount of Common Stock owned, held or controlled by
such officer of director) of the Lockup Shares shall be automatically released
from the applicable restrictions in this Agreement.
 
 

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3. 
Registration Rights and Limitations.

 
As partial consideration for the execution of this Agreement, (i) the Company
agrees that (a) the Company shall include the Excluded Shares in the
Registration Statement and (ii) the Holder shall have the same registration
rights with respect to the Excluded Shares that are granted to the Investors in
the Offering and (b) the Holder agrees that the Lockup Shares will not be
included in the Registration Statement.  Notwithstanding anything to the
contrary in this Agreement, the Company agrees that it shall file the
Registration Statement within sixty (60) days of the date hereof.

4. 
Miscellaneous.

 
a.             At any time, and from time to time, after the signing of this
Agreement 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 New York 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 New York or in the federal courts located in the state of New
York.  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 upon forum non
conveniens.  The parties executing this Agreement and 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 attorney’s 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.  Notices hereunder shall be given in the same manner as set forth in
the Purchase Agreement.  Each party hereby irrevocably waives personal service
of process and consents to process being served in any suit, action or
proceeding in connection with this Agreement by mailing a copy thereof via
registered or certified mail or overnight delivery (with evidence of delivery)
to such party at the address in effect for notices to it under this Agreement
and agrees that such service shall constitute good and sufficient service of
process and notice thereof.  Nothing contained herein shall be deemed to limit
in any way any right to serve process in any other manner permitted by law.  
 
 
 

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c.             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 or to which the Holder is subject to by applicable law.
 
d.             This Agreement shall be binding upon Holder, its legal
representatives, successors and assigns.
 
e.             This Agreement may be signed and delivered by facsimile signature
and delivered electronically.
 
f.             The Company agrees not to take any action or allow any act to be
taken which would be inconsistent with this Agreement.
 
g.             The Holder acknowledges that this Lockup Agreement is being
entered into for the benefit of the Investors in the Offering and may be
enforced by the Investors and may not be amended without the consent of the
Investors, which may be withheld for any reason.
[Signature Page Follows]
 
 

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

 
HOLDER:
         
/s/ Isaac Mizrahi
   
(Signature of Holder Representative)
         
Isaac Mizrahi, Vice President
   
(Print Name of Holder Representative)
 

 
COMPANY:
           
By:
/s/ Robert D’Loren
     
Name:  Robert D’Loren
     
Title:
 

 
 

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