An agreement between a company or the underwriters ( www.practicallaw.com/7-382-3888) on the one hand, and a stockholder on the other hand, that is executed in the course of a registered securities offering. In the lock-up agreement, the stockholder agrees that it will not sell its shares of the company for a specified period of time after the effective date of the registration statement ( www.practicallaw.com/4-382-3743) or after the date of the underwriting agreement. The typical lock-up period in an initial public offering ( www.practicallaw.com/2-382-3541) is for 180 days; in a follow-on offering ( www.practicallaw.com/5-382-3479) , the lock-up period is usually 90 days. See also overhang analysis ( www.practicallaw.com/7-382-3666) .
For more information on lock-up agreements, see Underwriting Agreement Commentary: Covenants ( www.practicallaw.com/7-380-7925) .