REGISTRATION RIGHTS AGREEMENT
EXHIBIT
10.3
THIS
REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is
entered into as of May 10, 2010 by and between Jacksonville Bancorp, Inc., a
Florida corporation (the “Company”), and the
investors listed on the signature page(s) hereto (the “Investors”).
RECITALS
WHEREAS, this Agreement is
made pursuant to a Stock Purchase Agreement (the “Stock Purchase
Agreement”), dated as of May 10, 2010, by and between the Company and
each Investor;
WHEREAS, pursuant to the Stock
Purchase Agreement, and subject to the terms and conditions set forth therein,
(a) the Investors have agreed to purchase from the Company, pursuant to a
private placement by the Company, shares (the “Shares”) of the
Company’s common stock, par value $0.01 (the “Common Stock”), and
(b) the Company has agreed to issue and sell the Shares to the Investors;
and
WHEREAS, as a condition to the
consummation of the transactions contemplated by the Stock Purchase Agreement,
the Company has agreed to enter into this Agreement in order to grant certain
registration rights to the Investors, as set forth below.
NOW, THEREFORE, in
consideration of the foregoing promises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties, intending to be legally bound, hereto agree as follows:
SECTION
1. GENERAL
1.1 Definitions. As
used in this Agreement, the following terms shall have the following respective
meanings:
“ABI” means Atlantic
BankGroup, Inc., a Florida corporation.
“Acquisition” means
the acquisition of ABI by merger with the Company.
“Agreement” has the
meaning set forth in the recitals.
“Affiliate” of any
Person means any other Person controlling, controlled by or under common control
with such
particular person or entity. The term “control” (including the terms
“controlling”, “controlled” and “under common control with”) as used with
respect to any Person means the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities, by contract or
otherwise.
“Allowable Suspension
Period” has the meaning set forth in Section
2.5.
“Business Day” means a
day, other than a Saturday or Sunday, on which banks in New York City are open
for the general transaction of business.
“CapGen” means CapGen
Capital Group IV LP, a Delaware limited partnership.
“Closing” means the
Closing, as defined in the Stock Purchase Agreement.
“Common Stock” has the
meaning set forth in the recitals.
“Company” has the
meaning set forth in the preamble.
“Effective Date” means
the date that the registration statement filed pursuant to Section 2.1(b) is
first declared effective by the Commission.
“Effectiveness
Deadline” means, with respect to the initial registration statement
required to be filed pursuant to Section 2.1(b), the
earlier of (i) the 60th calendar day following the Filing Date (or the 120th
calendar day following the Filing Date in the event that such registration
statement is subject to review by the SEC or additional financial statements
reflecting the acquisition of ABI are required by SEC rules or are requested by
SEC staff) and (ii) the 5th Business Day after the date the Company is notified
(orally or in writing, whichever is earlier) by the SEC that such registration
statement will not be “reviewed” or will not be subject to further review; provided that if the
Effectiveness Deadline falls on a Saturday, Sunday or other day that the
Commission is closed for business, the Effectiveness Deadline shall be extended
to the next Business Day on which the Commission is open for
business.
“Effectiveness Period”
has the meaning set forth in Section 2.1(b).
“Event” has the
meaning set forth in Section 2.1(b).
“Event Date” has the
meaning set forth in Section 2.1(b).
“Exchange Act” means
the Securities Exchange Act of 1934, as amended, or similar federal statute
successor thereto, and the rules and regulations of the Commission promulgated
thereunder, as they each may be in effect from time to time.
“Filing Date” means
the earlier of (i) the Filing Deadline and (ii) the date on which the initial
Mandatory Registration is filed with the SEC.
“Filing Deadline” has
the meaning set forth in Section
2.1(b).
“Form S-1” means a
registration statement on Form S-1 under the Securities Act as in effect on the
date hereof or any successor or similar registration form under the Securities
Act subsequently adopted by the SEC.
“Form S-3” means a
registration statement on Form S-3 under the Securities Act as in effect on the
date hereof or any successor or similar registration form under the Securities
Act subsequently adopted by the SEC which permits inclusion or incorporation of
substantial information by reference to other documents filed by the Company
with the SEC.
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“Holder” means any
Investor and any transferee thereof, which holds directly of record or
indirectly through a broker-dealer or securities clearing agency of record and
following notice to the Company and a proper transfer of Shares, from time to
time, Registrable Securities, provided that the Investor
may transfer its rights under this Agreement to its Affiliates without notice or
consent from the Company.
“Holder Affiliates”
has the meaning set forth in Section
2.8(a).
“Investors” has the
meaning set forth in the preamble.
“Liquidated Damages”
has the meaning set forth in Section
2.1(b).
“Mandatory
Registration” has the meaning set forth in Section
2.1(b).
“Misstatement” has the
meaning set forth in Section
2.4(g).
“New Stock” means
Common Stock or securities convertible into, or exchangeable or exercisable for
Common Stock, or which have voting rights or participation features with Common
Stock, offered in a public or nonpublic offering by the Company.
“Person” means any
individual, corporation, partnership, sole proprietorship, joint venture,
limited liability company, business trust, joint stock company, trust,
association or unincorporated organization or any government or any agency or
political subdivision thereof.
“Qualified Equity
Offering” means a public or nonpublic offering of New Stock solely for
cash and not pursuant to a Special Registration; provided, however, that none
of the following offerings shall constitute a Qualified Equity
Offering: (a) any offering pursuant to any stock purchase plan,
dividend reinvestment plan, stock ownership plan, stock option or equity
compensation or incentive plan or other similar plan where stock is being issued
or offered to a trust, other entity or otherwise, to or for the benefit of any
employees, potential employees, officers or directors of the Company, or (b) any
offering made as consideration pursuant to an acquisition or business
combination (whether structured as a merger or otherwise), a partnership or
joint venture or strategic alliance or investment by the Company or similar
non-capital raising transaction (but not an offering to raise capital or monies
to pay the purchase consideration for such an acquisition).
“Register,”
“registered,” and “registration” shall
refer to a registration effected by preparing and filing a registration
statement in compliance with the Securities Act, and the declaration or ordering
of effectiveness of such registration statement.
“Registrable
Securities” means (a) the Shares; (b) any other shares of Common Stock
held by the Holders and purchased from the Company, whether directly, or
indirectly through an underwriter or placement agent; and (c) any Common Stock
of the Company issued as (or issuable upon the conversion or exercise of any
warrant, right, preferred stock or other security which is issued after the
Closing as) a dividend, stock split or other distribution or in connection with
a combination of shares, recapitalization, merger, consolidation or other
reorganization with respect to, or in exchange for or in replacement of, the
Common Stock held by the Holders, provided, however, that Registrable
Securities shall not include any shares of Common Stock which have been sold to
the public by a Holder either pursuant to a registration statement or Rule 144,
or which have been sold in a private transaction in which the transferor’s
rights under this Agreement are not assigned.
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“Registrable Securities then
outstanding” shall be the number of shares determined by calculating the
total number of shares of the Company’s Common Stock that are Registrable
Securities and either (a) are then issued and outstanding or (b) are issuable
pursuant to exercisable or convertible securities.
“Registration
Expenses” shall mean all fees and expenses incurred by the Company
relating to any registration, qualification or compliance pursuant to this
Agreement (including any Mandatory Registration or Shelf Registration),
including, without limitation, all registration and filing fees, exchange
listing fees, transfer agent’s and registrar’s fees, cost of distributing
prospectuses in preliminary and final form as well as any supplements thereto,
printing expenses, fees and disbursements of counsel for the Company, blue sky
fees and expenses, Financial Industry Regulatory Authority
fees, expenses of the Company’s independent accountants, and fees and
expenses of underwriters (excluding discounts and commissions) and any other
Persons retained by the Company, but shall not include the compensation of
regular employees of the Company, which shall be paid in any event by the
Company, and shall not include Selling Expenses, which shall be paid by the
Holders. Notwithstanding the foregoing, Registration Expenses shall
include the reasonable, documented, fees and expenses of one counsel chosen by
the Holders of a majority of the Registrable Securities covered by such
registration for such counsel rendering services customarily performed by
counsel for selling shareholders that are submitted to the Company in
writing.
“Rule 144” means Rule
144 promulgated by the Commission pursuant to the Securities Act, as such Rule
may be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission having substantially the same effect as such
Rule.
“SEC” or “Commission” means the
Securities and Exchange Commission or any successor agency.
“SEC Guidance” means
(i) any publicly-available written or oral guidance, comments, requirements or
requests of the SEC staff and (ii) the Securities Act.
“Securities Act” shall
mean the Securities Act of 1933, as amended, or similar federal statute
successor thereto, and the rules and regulations of the Commission promulgated
thereunder, as they each may, from time to time, be in effect.
“Selling Expenses”
shall mean all underwriting discounts, selling commissions and stock transfer
taxes applicable to the sale of Registrable Securities and fees and
disbursements of counsel for any Holder (other than the fees and disbursements
of counsel included in Registration Expenses).
“Shares” has the
meaning set forth in the recitals.
“Shelf Registration”
has the meaning set forth in Section
2.1(b).
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“Shelf Termination
Date” has the meaning set forth in Section
2.1(b).
“Special Registration”
means the registration of (a) equity securities and/or options or other rights
in respect thereof solely registered on Form S-4 or Form S-8 (or any successor
or similar registration form under the Securities Act) or (b) shares of equity
securities and/or options or other rights in respect thereof to be offered to
directors, management, employees, potential employees, consultants, customers,
lenders or vendors of the Company or its direct or indirect subsidiaries or in
connection with dividend reinvestment or stock purchase plans.
“Stock Purchase
Agreement” has the meaning set forth in the recitals.
“Suspension Period”
has the meaning set forth in Section
2.5.
“Violation” has the
meaning set forth in Section
2.9(a).
SECTION
2. REGISTRATION
2.1 Demand Registration and
Shelf Registration.
(a) Subject
to the conditions of this Section 2.1, so long
as the Holders hold at least 25% of the Shares purchased pursuant to the Stock
Purchase Agreement or resulting from such Shares by virtue of a stock split,
stock dividend or distribution in respect of such purchase by the Holders as of
the date hereof, if the Company shall receive a written request from the Holders
that the Company file a registration statement under the Securities Act covering
the registration of at least 25% of the Registrable Securities then outstanding
or a lesser percent if the anticipated aggregate offering price based on the
then-current market prices, net of underwriting discounts and commissions, would
exceed $2,500,000, then the Company shall, within 10 days of the receipt
thereof, give written confirmation of such request to the Holders, and subject
to the limitations of this Section 2.1, effect,
as expeditiously as reasonably possible, the registration under the Securities
Act of all Registrable Securities that the Holders request to be
registered.
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(b) Mandatory
Registration.
(i) The
Company shall use its reasonable best efforts to file by the 30th day
following the Closing or if the Company is required to file audited or pro forma
financial statements with the SEC to reflect the Acquisition, not later than two
(2) Business Days after the date of filing such financial statements with the
SEC on or prior to the deadline for filing such financial statements (such date,
the “Filing
Deadline”), with the SEC, a registration statement on Form S-1 or such
other SEC form which the Company is eligible to use with respect to the resale
from time to time, whether underwritten or otherwise, of the Registrable
Securities by the Holders. The Company shall use Form S-3, if it is
then eligible to use Form S-3. The Company shall use its reasonable
best efforts to promptly respond to all SEC comments, if any, related to such
registration statement but in any event within two weeks of the receipt thereof,
and shall use its reasonable best efforts to obtain all such qualifications and
compliances as may be so requested and as would permit or facilitate the sale
and distribution of all of the Holders’ Registrable Securities, including
causing such registration statement to be declared effective by the SEC as soon
as practicable after filing and no later than the Effectiveness
Deadline. The Company shall use its reasonable best efforts to
maintain the effectiveness of the registration effected pursuant to this Section 2.1(b) at all
times. The registration contemplated by this Section 2.1(b) is
referred to herein as the “Mandatory
Registration.” The Mandatory Registration shall be filed with
the SEC in accordance with and pursuant to Rule 415 promulgated under the
Securities Act (or any successor rule then in effect) (a “Shelf
Registration”). So long as any such Shelf Registration is
effective as required herein and in compliance with the Securities Act and is
usable for resale of Registrable Securities, the Holders shall be entitled to
demand any number of takedowns (including underwritten takedowns, provided that (i) the
Registrable Securities requested to be included in such underwritten takedown
constitute at least 25% of the Registrable Securities then outstanding or (ii)
the anticipated aggregate offering price based on the then-current market
prices, net of underwriting discounts and commissions, would exceed $2,500,000
from the Shelf Registration. In connection with any such takedown,
the Company shall take all customary and reasonable actions that the Company
would take in connection with an underwritten registration pursuant to Section 2.1(a) or
Section 2.3
(including, without limitation, all actions referred to in Section 2.5 necessary
to effectuate such sale in the manner determined by the Holders of at least a
majority of the Registrable Securities to be included in such underwritten
takedown). The Company shall use its reasonable best efforts to cause
the registration statement or statements filed hereunder to remain effective
until such date (the “Shelf Termination
Date”) that is the earlier of (i) the date on which all Registrable
Securities included in the registration statement shall have been sold or shall
have otherwise ceased to be Registrable Securities and (ii) the date that all
Registrable Securities covered by such registration statement may be sold
without volume or manner of sale restrictions under Rule 144 (after taking into
account any Holder’s status as an Affiliate of the Company) for purposes of Rule
144 and without the requirement for compliance by the Company with the current
public information requirements under Rule 144(c)(1) or, if applicable, Rule
144(i)(2), as determined by counsel to the Company (the “Effectiveness
Period”). In the event the Mandatory Registration must be
effected on Form S-1 or any similar long-form registration as the Company may
elect or is required to use, such registration shall nonetheless be filed as a
Shelf Registration and the Company shall use all reasonable best efforts to keep
such registration current and effective, including by filing periodic
post-effective amendments to update the information therein, including the
financial statements contained in such registration statement in accordance with
Regulation S-X promulgated under the Securities Act until the Shelf Termination
Date. The Company shall not include in the Mandatory Registration any
securities which are not Registrable Securities without the prior written
consent of the Holders of at least a majority of the Registrable Securities
included in such registration. The Company shall request
effectiveness of a Registration Statement as of 5:00 P.M. New York City time on
a Business Day. The Company shall promptly notify the Holders via
facsimile or electronic mail in a “.pdf” format data file of the effectiveness
of a Registration Statement within one (1) Business Day of the Effective Date.
The Company shall, by 9:30 A.M. New York City time on the first Business Day
after the Effective Date, file a final Prospectus with the Commission, as
required by Rule 424(b).
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(ii) Notwithstanding
the registration obligations set forth in this Section 2.1(b), in the event the
SEC informs the Company that all of the Registrable Securities then outstanding
cannot, as a result of the application of Rule 415 of the Securities Act, be
registered for resale as a secondary offering on a single registration
statement, the Company agrees to promptly (i) inform each of the Holders thereof
and use its commercially reasonable efforts to file amendments to the initial
registration statement as required by the SEC and/or (ii) withdraw the initial
registration statement and file a new registration statement, in either case
covering the maximum number of Registrable Securities permitted to be registered
by the SEC, on Form X-0, Xxxx X-0 or such other form available to the Company to
register for resale the Registrable Securities as a secondary offering; provided, that prior to filing such
amendment or new registration statement, the Company shall be obligated to use
its commercially reasonable efforts to advocate with the Commission for the
registration of all of the Registrable Securities in accordance with the SEC
Guidance, including without limitation, Compliance and Disclosure Interpretation
612.09. Notwithstanding any other provision of this Agreement, if any SEC
Guidance sets forth a limitation of the number of Registrable Securities or
other shares of Common Stock permitted to be registered on a particular
Registration Statement as a secondary offering (and notwithstanding that the
Company used diligent efforts to advocate with the SEC for the registration of
all or a greater number of Registrable Securities), the number of Registrable
Securities or other shares of Common Stock to be registered on such registration
statement will be reduced on a pro rata basis. In the event the Company amends
the initial registration statement or files a new registration statement, as the
case may be, under clauses (i) or (ii) above, the Company will use its
commercially reasonable efforts to file with the SEC, as promptly as allowed by
SEC or SEC Guidance provided to the Company or to registrants of securities in
general, one or more registration statements on Form X-0, Xxxx X-0 or such other
form available to the Company to register for resale those Registrable
Securities that were not registered for resale on the initial registration
statement, as amended, or the new registration statement.
(iii) If:
(i) the initial registration statement required to be filed pursuant to Section 2.1(b) is not
filed with the SEC on or prior to the Filing Deadline, or (ii) the initial
registration statement required to be filed pursuant to Section 2.1(b) is not
declared effective by the SEC (or otherwise does not become effective) for any
reason on or prior to the Effectiveness Deadline (any such failure an “Event,” and the date
on which such Event occurs, an “Event Date” for
purposes of this Section 2.1(b)(iii)),
then in addition to any other rights the Holders may have hereunder or under
applicable law, on each Event Date, the Company shall pay one time to each
Holder an amount in cash, as liquidated damages and not as a penalty (“Liquidated Damages”),
equal to 1% of the purchase price paid in cash for any Registrable Securities
held by such Holder on the Event Date. The parties agree that
notwithstanding anything to the contrary herein or in the Stock Purchase
Agreement, no Liquidated Damages shall be payable if as of the relevant Event
Date, the Registrable Securities may be sold by non-affiliates without volume or
manner of sale restrictions under Rule 144 and the Company is in compliance with
the current public information requirements under Rule 144(c)(1) (or Rule
144(i)(2), if applicable), as determined by counsel to the
Company. The Effectiveness Deadline for a Registration Statement
shall be extended without default or Liquidated Damages hereunder in the event
that the Company’s failure to obtain the effectiveness of the registration
statement on a timely basis results from the failure of an Investor to timely
provide the Company with information requested by the Company and necessary to
complete the registration statement in accordance with the requirements of the
Securities Act (in which case the Effectiveness Deadline would be
extended).
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(iv) In
the event that Form S-3 is not available for the registration of the resale of
Registrable Securities hereunder, the Company shall (i) register the resale of
the Registrable Securities on another appropriate form and (ii) undertake to
register the Registrable Securities on Form S-3 promptly after such form is
available, provided
that the Company shall
maintain the effectiveness of the Registration Statement then in effect until
such time as a Registration Statement on Form S-3 covering the Registrable
Securities has been declared effective by the Commission.
(c) Notwithstanding
any other provision of this Section 2.1 or Section 2.2, if the
managing underwriter advises the Company that marketing factors require a
limitation of the number of securities to be underwritten (including Registrable
Securities), then the Company shall so advise the Holders of Registrable
Securities which would otherwise be included in such underwritten registration
or takedown off the registration statement, and the number of shares of
Registrable Securities that may be included in the underwriting shall be
allocated to the Holders of such Registrable Securities on a pro rata basis based on the
number of Registrable Securities held by all such Holders. Any
Registrable Securities excluded or withdrawn from such underwriting shall be
withdrawn from the registration or takedown, as applicable.
(d) Other
than any Mandatory Registration required pursuant to Section 2.1(b), the
Company may include in any registration pursuant to Section 2.1(a) other
securities for sale for its own account or for the account of any other Person;
provided that, if the
managing underwriter for the offering shall determine that the number of shares
proposed to be offered in such offering would be reasonably likely to adversely
affect such offering, then the Registrable Securities to be sold by the Holders
shall be included in such registration before any securities proposed to be sold
for the account of the Company or any other Person.
2.2 Piggyback
Registrations.
(a) The
Company shall notify each Holder who holds Registrable Securities in writing at
least 10 Business Days prior to the filing of any registration statement under
the Securities Act for purposes of a public offering of securities of the
Company (whether in connection with a public offering of securities by the
Company, a public offering of securities by shareholders of the Company, or
both, but excluding any registration relating to an offering that is not a
Qualified Equity Offering or which is a Special Registration, or a registration
on any registration form that does not permit secondary sales) and in any event
including a registration resulting from obligations arising out of any other
registration rights agreement to which the Company is a party, and shall afford
each such Holder an opportunity to include in such registration statement all or
part of the Registrable Securities held by such Holder. Each Holder
desiring to include in any such registration statement all or any part of the
Registrable Securities held by such Holder shall, within five (5) Business Days
after receipt of the above-described notice from the Company, so notify the
Company in writing. Such notice shall state such Holder’s desire to
include all or a part of the Registrable Securities held by such
Holder. If a Holder decides not to include all of its Registrable
Securities in any registration statement thereafter filed by the Company, such
Holder shall nevertheless continue to have the right to include any Registrable
Securities in any subsequent registration statement or registration statements
as may be filed by the Company with respect to offerings of its securities, all
upon the terms and conditions set forth herein.
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(b) Underwriting. If
the registration statement under which the Company gives notice under this Section 2.2 is for an
underwritten offering, the Company shall so advise in such notice the Holders
who hold Registrable Securities. In such event, the right of any such
Holder to be included in a registration pursuant to this Section 2.2 shall be
conditioned upon such Holder’s participation in such underwriting and the
inclusion of the Registrable Securities such Holder desires to include in such
registration in the underwriting. All Holders proposing to distribute
their Registrable Securities through such underwriting shall enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting by the Company.
Notwithstanding
any other provision of this Agreement, if the managing underwriter determines in
good faith that marketing factors require a limitation of the number of Shares
to be underwritten in a registration statement pursuant to this Section 2.2, the
number of Shares that may be included in such underwriting shall be allocated
first to the Company; second, to all Holders who are entitled to participate and
who have elected to participate in the offering pursuant to the terms of this
Agreement, on a pro
rata basis based upon the total number of Shares held by each such
participating Holder that are subject to piggyback registration rights pursuant
hereto; and third, to any other shareholder of the Company on a pro rata basis.
If any
Holder disapproves of the terms of any such underwriting, such Holder may elect
to withdraw therefrom by written notice to the Company and the managing
underwriter, delivered at least 10 calendar days prior to the effective date of
the registration statement or in the case of a registration statement on Form
S-3 or similar short-form registration statement, by the close of business on
the first Business Day after the public notice of an offering or if the offering
is publicly announced at the beginning of a Business Day, 4:00 P.M. Eastern
Time on such day.
(c) Right to Terminate
Registration. The Company shall have the right to terminate or
withdraw any registration initiated by it under this Section 2.2 prior to
the effectiveness of such registration whether or not any Holder has elected to
include securities in such registration. The Registration Expenses of
such withdrawn registration shall be borne by the Company in accordance with
Section
2.3.
2.3 Expenses of
Registration. Except as specifically provided herein, all
Registration Expenses incurred in connection with any registration,
qualification or compliance hereunder shall be borne by the
Company. The obligation of the Company to bear Registration Expenses
shall apply irrespective of whether a registration, once properly demanded or
requested becomes effective or is withdrawn or suspended. All Selling Expenses
incurred shall be borne by the Holders of the Shares so registered pro rata on the basis of the
number of Shares so registered. Notwithstanding the foregoing, the
Holders and not the Company shall be required to pay for expenses of any
registration proceeding begun pursuant to Section 2.1(a), the
request of which has been subsequently withdrawn by the Holders, unless (a) the
Company has requested the Holders to withdraw such request or the Company and
the Holders of a majority of Registered Securities requesting such registration
determine that such request should be withdrawn, (b) the withdrawal is based
upon material adverse information concerning the Company that the Company had
not publicly disclosed prior to the request for registration or that the Company
had not otherwise notified the Holders of at the time of such request for
registration or (c) the Holders of a majority of Registrable Securities
requesting such registration, as the case may be, agree to forfeit their right
to one requested registration pursuant to Section
2.1(a).
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If the
Holders are required to pay the Registration Expenses, such expenses shall be
borne by the Holders of Registrable Securities requesting such registration in
proportion to the number of Registrable Securities for which registration was
requested. If the Company is required to pay the Registration
Expenses of a withdrawn offering pursuant to clause (a) above, then the Holders
shall not forfeit their rights pursuant to Section
2.1(a).
2.4 Obligations of the
Company. In the case of a Mandatory Registration and whenever
required to effect the registration of any Registrable Securities, the Company
shall, as expeditiously as practicable:
(a) In
the case of a Mandatory Registration, prepare and file with the SEC a
registration statement, and all amendments and supplements thereto and related
prospectuses and issuer free writing prospectuses as may be necessary to comply
with applicable securities laws, with respect to such Registrable Securities and
use its reasonable best efforts to cause such registration statement to become
effective, provided
that before filing a registration statement or prospectus or any
amendments or supplements thereto and issuer free writing prospectuses, the
Company shall furnish to the one counsel selected by the Holders of a majority
of the Registrable Securities covered by such registration statement copies of
all such documents proposed to be filed and give such counsel a reasonable
opportunity to review and comment on such documents before they are filed and
the opportunity to object to any information pertaining to the Holders that is
contained therein, and the Company shall make any changes with respect to, and
in reliance upon, information regarding the Holders reasonably requested by such
counsel to such documents prior to filing, and notify each Holder of the
effectiveness of each registration statement filed hereunder.
(b) In
the case of all registration statements other than a Mandatory Registration
Statement, prepare and file with the SEC a registration statement, and all
amendments and supplements thereto and related prospectuses and issuer free
writing prospectuses as may be necessary to comply with applicable securities
laws, with respect to such Registrable Securities and use all reasonable best
efforts to cause such registration statement to become effective, provided that, before filing
a registration statement or prospectus or any amendments or supplements thereto
and issuer free writing prospectuses, the Company shall furnish to the counsel
selected by the Holders of a majority of Registrable Securities covered by such
registration statement copies of all such documents proposed to be filed and
give such counsel a reasonable opportunity to review and comment on such
documents before they are filed and the opportunity to object to any information
pertaining to the Holders that is contained therein, and the Company shall make
any changes reasonably requested by such counsel with respect to and in reliance
upon, information regarding the Holders to such documents prior to filing,
notify in writing each Holder of the effectiveness of each registration
statement filed hereunder, and, upon the request of the holders of a majority of
the Registrable Securities registered thereunder, keep such registration
statement effective for up to 180 days or, if earlier, until the Holder or
Holders have completed the distribution related thereto, or, a period ending on
the earlier of (i) the date on which all Registrable Securities included in the
registration statement shall have been sold or shall have otherwise ceased to be
Registrable Securities and (ii) the date that all Registrable Securities covered
by such registration statement may be sold without volume or manner of sale
restrictions under Rule 144 (after taking into account any Holder’s status as an
Affiliate of the Company), and without the requirement for the Company to be in
compliance with the current public information requirements under Rule 144(c)(1)
(or Rule 144(i)(2), if applicable), as determined by counsel to the
Company.
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(c) Provide
to each Holder a copy of any disclosure regarding the plan of distribution or
the selling Holders, in each case, with respect to such Holder, at least two (2)
Business Days in advance of any filing with the SEC of any registration
statement or any amendment or supplement thereto that includes such
information.
(d) Furnish
to the selling Holders such number of copies of a prospectus, including a
preliminary prospectus, and each amendment and supplement thereto, in conformity
with the requirements of the Securities Act, and such other documents as they
may reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.
(e) Use
its reasonable best efforts to register and qualify the securities covered by
such registration statement under such other securities or Blue Sky laws of such
jurisdictions as shall be reasonably requested by the selling Holders; provided that the Company
shall not be required in connection therewith or as a condition thereto to
qualify to do business or to file a general consent to service of process in any
such jurisdictions.
(f)
In the event of any underwritten
public offering, enter into and perform its obligations under an underwriting
agreement, in usual and customary form, with the managing underwriter of such
offering. Each Holder participating in such underwriting shall also
enter into and perform its obligations under such an agreement.
(g) Promptly
notify each Holder who holds Registrable Securities covered by such registration
statement at any time when a prospectus relating thereto is required to be
delivered under the Securities Act of the happening of any event as a result of
which the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances under which they were made (a
“Misstatement”)
and the Company shall promptly prepare and file with the SEC (and furnish to
each such Holder a reasonable number of copies of) a supplement or amendment to
such prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus shall not contain an untrue statement of
a material fact or omit to state any fact necessary to make the statements
therein not misleading in light of the circumstances under which they were
made.
(h) Use
its reasonable best
efforts to furnish, on the date that such Registrable Securities are delivered
to the underwriters for sale, if such securities are being sold through
underwriters, (i) an opinion, dated as of such date, of the counsel representing
the Company for the purposes of such registration, in form and substance as is
customarily given to underwriters in an underwritten public offering, addressed
to the underwriters, if any, and (ii) a “comfort” letter dated as of such date,
from the independent registered public accountants of the Company, in form and
substance as is customarily given by independent registered public accountants
to underwriters in an underwritten public offering addressed to the
underwriters.
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(i)
Promptly notify each
Holder who holds Registrable Securities covered by such registration statement
in the event of the issuance of any stop order suspending the effectiveness of a
registration statement, or any order suspending or preventing the use of any
related prospectus or suspending the qualification of any equity securities
included in such registration statement for sale in any jurisdiction, and use
its reasonable best efforts promptly to obtain the withdrawal of such
order.
(j)
Prior to the
termination of registration rights in connection with all of the outstanding
Registrable Securities held by Holders other than CapGen and other Affiliates of
the Company and except in the case of a registration statement on Form S-3 or
similar short-form registration statement filed to register any shares of Common
Stock issued in connection with a Special Registration, in connection with an
offering excluded from a Qualified Equity Offering in connection with securities
issued to CapGen, the Company shall not grant to any other Person other than
CapGen the right to request the Company to register any shares of Common Stock
for resale in a registration on Form S-1 or Form S-3 (or a similar short-form
registration statement) without the consent of Holders holding a majority of
Registrable Securities unless (i) the registration or sale of such shares of
Common Stock was expressly permitted by the Stock Purchase Agreement and (ii)
such rights are consistent with the provisions hereof.
(k) The
Company shall cooperate with the Holders to facilitate the timely preparation
and delivery of Registrable Securities (whether through The Depository Trust
Company, book-entry or physical certificates), which certificates shall be free,
to the extent permitted under law, of all restrictive legends, and to enable
such Registrable Securities to be in such denominations and registered in such
names as any such Holders may reasonably request. Registrable
Securities in certificated form and free from all restrictive legends may be
transmitted by the transfer agent to a Holder by crediting the account of such
Holder’s prime broker with DTC as directed by such Holder.
(l)
The Company shall otherwise use commercially reasonable
efforts to comply with all applicable rules and regulations of the Commission
under the Securities Act and the Exchange Act, including Rule 172, notify the
Holders promptly if the Company no longer satisfies the conditions of Rule 172
and take such other actions as may be reasonably necessary to facilitate the
registration of the Registrable Securities hereunder.
(m) The
Company shall use commercially reasonable efforts to list the Registrable
Securities covered by such registration statement with any securities exchange
on which the Common Stock of the Company is then listed.
2.5 Suspension of
Sales. Upon receipt of written notice from the Company that a
registration statement or prospectus contains a Misstatement, each Holder who
holds Registrable Securities shall forthwith discontinue disposition of
Registrable Securities until such Holder has received copies of the supplemented
or amended prospectus that corrects such Misstatement, or until such Holder is
advised in writing by the Company that the use of the prospectus may be resumed
(a “Suspension
Period”), and, if so directed by the Company, such Holder shall deliver
to the Company (at the Company’s expense) all copies, other than permanent file
copies then in such Holder’s possession, of the prospectus covering such
Registrable Securities current at the time of receipt of such
notice. No single Suspension Period shall exceed 30 consecutive days
and, during any 365-day period, the aggregate of all Suspension Periods shall
not exceed an aggregate of 60 days (each Suspension Period complying with this
provision being an “Allowable Suspension
Period”). In addition, the Allowable Suspension Period shall
also include up to 30 days in each case where an amendment to the registration
statement on Form S-1 is required to update such registration statement, subject
to a 15 day further extension if such amendment is reviewed by the SEC, in each
case, solely as a result of the filing of periodic reports and current reports
under the Exchange Act.
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2.6 Termination of Registration
Rights. A Holder’s registration rights shall expire if all
Registrable Securities held by such Holder (and its Affiliates, partners,
members and former members) may be sold without volume or manner of sale
restrictions under Rule 144 (after taking into account any Holders’ status as an
Affiliate of the Company as determined by the Company), and without the
requirement for the Company to be in compliance with the current public
information requirements under Rule 144(c)(1) (or Rule 144(i)(2), if
applicable), as determined by counsel to the Company. In no event
shall this Agreement terminate as to a Holder that is an Affiliate of the
Company prior to the expiration of three months after such Holder ceased to be
an Affiliate of the Company, and provided further that at
least one year has elapsed since such Holder acquired the Shares from the
Company or from an Affiliate of the Company.
2.7 Delay of Registration;
Furnishing Information.
(a) No
Holder shall have any right to obtain or seek an injunction restraining or
otherwise delaying any such registration as the result of any controversy that
might arise with respect to the interpretation or implementation of this Section
2.
(b) It
shall be a condition precedent to the obligations of the Company to take any
action pursuant to Sections 2.1 or Section 2.2 that the
selling Holders shall furnish to the Company such information regarding
themselves, the Registrable Securities held by them and the intended method of
disposition of such securities as shall be required to effect the registration
of their Registrable Securities.
(c) The
Company shall have no obligation with respect to any registration requested
pursuant to Section
2.1(a) (except that any expenses in connection with such registration or
attempted registration shall be Registration Expenses) if the number of shares
or the anticipated aggregate offering price of the Registrable Securities to be
included in the registration does not equal or exceed the number of shares or
the anticipated aggregate offering price required to originally trigger the
Company’s obligation to initiate such registration as specified in Section
2.1(a).
2.8 Indemnification. In
the event any Registrable Securities are included in a registration statement
under this Section
2:
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(a) To
the extent permitted by law, the Company will indemnify and hold harmless each
Holder, the officers, directors, agents, general partners, managing members,
managers, affiliates and employees of each Holder (collectively, “Holder Affiliates”),
and each Person, if any, who controls such Holder and Holder Affiliates within
the meaning of the Securities Act or the Exchange Act, against any losses,
claims, damages, or liabilities (joint or several) to which they may become
subject under the Securities Act, or the Exchange Act or other federal or state
law, insofar as such losses, claims, damages, or liabilities (or actions in
respect thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively, a “Violation”): (i)
any untrue statement or alleged untrue statement of a material fact contained in
such registration statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto, except to
the extent that such untrue statement or alleged untrue statement is based
solely upon information provided in writing by such Holder expressly for use
therein, (ii) the omission or alleged omission to state therein a material fact
required to be stated therein, or necessary to make the statements therein not
misleading, except to the extent that such omission or alleged omission is based
solely upon information provided in writing by such Holder expressly for use
therein or (iii) any violation or alleged violation by the Company of the
Securities Act, the Exchange Act, any state securities law or any rule or
regulation promulgated under the Securities Act, the Exchange Act or any state
securities law; and the Company will pay to each such Holder or Holder
Affiliate, or controlling person, as accrued, any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this Section 2.9(a) shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability, or action if such settlement is effected without the prior written
consent of the Company.
(b) To
the extent permitted by law and provided that such Holder is not entitled to
indemnification pursuant to Section 2.8(a) above
with respect to such matter, each selling Holder (severally and not jointly)
will indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, and each Person, if any, who
controls the Company within the meaning of the Securities Act or the Exchange
Act, against any losses, claims, damages, or liabilities to which any of the
foregoing persons may become subject under the Securities Act, the Exchange Act
or other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or are based upon any
(i) untrue statement or alleged untrue statement of a material fact regarding
such Holder and provided in writing by such Holder expressly for use in such
registration statement, including any preliminary prospectus or final prospectus
contained therein or any amendments, supplements or free writing prospectuses
thereto or (ii) the omission or alleged omission to state therein a material
fact required to be stated therein, or necessary to make the statements therein
not misleading, in each case to the extent (and only to the extent) that such
untrue statement or alleged untrue statement or omission or alleged omission was
made in such registration statement, preliminary or final prospectus, amendment,
supplement or free writing prospectuses thereto, in reliance upon and in
conformity with written information furnished by such Holder expressly for use
in connection with such registration statement; and each such Holder will pay
the Company or controlling Person, as accrued, any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability, or action as a result of such Holder’s
untrue statement or omission; provided, however, that the
indemnity agreement contained in this Section 2.8(b) shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Holders; provided,
that, (x) the
indemnification obligations in this Section 2.8(b) shall
be individual and several not joint for each Holder and (y) in no event shall
the aggregate of all indemnification payments by any Holder under this Section 2.8(b) exceed
the net proceeds from the offering received by such Holder.
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(c) Promptly
after receipt by an indemnified party under this Section 2.9 of notice
of the commencement of any claim or action (including any governmental action),
such indemnified party will, if a claim in respect thereof is to be made against
any indemnifying party under this Section 2.8, deliver
to the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an
indemnified party (together with all other indemnified parties which may be
represented without conflict by one counsel) shall have the right to retain one
separate counsel, with the reasonable fees and expenses of such counsel to be
paid by the indemnifying party, if representation of such indemnified party by
the counsel retained by the indemnifying party would be inappropriate due to
actual or potential differing interests between such indemnified party and any
other party represented by such counsel in such proceeding. The
failure to deliver written notice to the indemnifying party within a reasonable
time of the commencement of any such action shall not relieve such indemnifying
party of any liability to the indemnified party under this Section 2.8, except
to the extent such failure to give notice has a material adverse effect on the
ability of the indemnifying party to defend such action.
(d) If
the indemnification provided for in this Section 2.8 is held
by a court of competent jurisdiction to be unavailable to an indemnified party
with respect to any loss, liability, claim, damage or expense referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party hereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim, damage, or expense
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and of the indemnified party on the other in
connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of
the indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties’ relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission. Notwithstanding the foregoing, the amount any
Holder will be obligated to contribute pursuant to this Section 2.8(d) will
be limited to an amount equal to the per share offering price (less any
underwriting discount and commissions) multiplied by the number of shares sold
by such Holder pursuant to the registration statement which gives rise to such
obligation to contribute (less the aggregate amount of any damages which such
Holder has otherwise been required to pay in respect of such loss, liability,
claim, damage, or expense or any substantially similar loss, liability, claim,
damage, or expense arising from the sale of such Registrable
Securities). No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution hereunder from any person who was not guilty of such fraudulent
misrepresentation.
15
(e) Notwithstanding
the foregoing, to the extent that the provisions on indemnification and
contribution contained in the underwriting agreement entered into in connection
with the underwritten public offering are in conflict with the foregoing
provisions, the provisions in the underwriting agreement shall control; provided that the
indemnification provisions of the Holders in any underwriting agreement may not
conflict with the provisions of this Section 2.8 without
the consent of the Holders.
(f)
The obligations of
the Company and the Holders under this Section 2.8 shall
survive the completion of any offering of shares of Common Stock in a
registration statement under this Section 2, and
otherwise. The indemnity and contribution agreements contained in
this Section
2.8 are in addition to any liability that an indemnifying party may have
to an indemnified party.
2.9 Rule 144
Reporting. With a view to making available to the Holders the
benefits of certain rules and regulations of the SEC which may permit the sale
of the Registrable Securities to the public without registration, the Company
agrees to use its reasonable best efforts
to:
(a) make
and keep public information available, as those terms are understood and defined
in Rule 144 or any similar or analogous rule promulgated under the Securities
Act, at all times after the effective date of this Agreement;
(b) file
with the SEC, in a timely manner, all reports and other documents required of
the Company under the Exchange Act; and
(c) so
long as a Holder owns any Registrable Securities, furnish to such Holder
promptly upon request: a written statement by the Company as to its compliance
with the reporting requirements of Rule 144, and of the Exchange Act; a copy of
the most recent annual or quarterly report of the Company; and such other
reports and documents as a Holder may reasonably request in availing itself of
any rule or regulation of the SEC allowing it to sell any such securities
without registration.
SECTION
3. MISCELLANEOUS
3.1 Successors and
Assigns. Except as otherwise provided herein, the terms and
conditions of this Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties (including any transferees
of any shares of Registrable Securities). In addition, whether or not
any express assignment shall have been made, the provisions of this Agreement
which are for the benefit of the Holders as such shall be for the benefit of,
and enforceable by, any subsequent Holder. Nothing in this Agreement,
express or implied, is intended to, or shall confer upon any Person other than
the parties hereto or their respective successors and assigns (including any
transferees of any shares of Registrable Securities) or any subsequent Holder
any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.
3.2 Governing
Law. This Agreement shall be governed by and construed under
the laws of the State of New York without regard to its conflicts of laws
rules.
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3.3 Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
3.4 Titles,
etc. The titles and subtitles used in this Agreement are used
for convenience only and are not to be considered in construing or interpreting
this Agreement. Herein, the singular shall include the plural and
vice versa, any reference to gender shall include any genders and the words
“include”, “including” and derivations thereof shall mean without limitation,
whether by enumeration or otherwise.
3.5 Notices. Unless
otherwise provided, any notice required or permitted under this Agreement shall
be given in writing and shall be deemed effectively given upon personal delivery
to the party to be notified or upon deposit with the United States Post Office,
by registered or certified mail, postage prepaid and addressed to the party to
be notified at the address indicated for such party on the signature page
hereof, or at such other address as such party may designate, or by delivery
with a reliable overnight delivery service by three (3) days’ advance written
notice to the other parties.
3.6 Amendments and
Waivers. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company, and the Holders as long as the Holders hold
Registrable Securities. Any amendment or waiver effected in
accordance with this paragraph shall be binding upon each Holder of any
Registrable Securities then outstanding and the Company.
3.7 Severability. If
one or more provisions of this Agreement are held to be unenforceable under
applicable law, such provision shall be excluded from this Agreement and the
balance of the Agreement shall be interpreted as if such provision were so
excluded and shall be enforceable in accordance with its terms.
3.8 Aggregation of
Stock. All shares of Registrable Securities held or acquired
by any Holders which are Affiliates shall be aggregated together for the purpose
of determining the availability of any rights under this Agreement.
3.9 Entire
Agreement. This Agreement constitutes the full and entire
understanding and agreement among the parties with regard to the subject matter
hereof.
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IN WITNESS WHEREOF, the
parties hereto have caused and this Agreement to be executed by their respect
undersigned officers thereto duly authorized as of the date set forth in the
first paragraph hereof.
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JACKSONVILLE
BANCORP, INC.
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By:
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/s/
Xxxxxxx X. Xxxxx, III
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Name: Xxxxxxx
X. Xxxxx, III
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Title:
President
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Address: 000
Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx,
Xxxxxxx 00000
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Attention:
Xxxxxxx X. Xxxxx, III
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INVESTOR
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By:
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Name:
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Title:
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Address:
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[Signature
Page to Registration Rights Agreement]
