Schedule 6.20 REGISTRATION RIGHTS
Exhibit
99.3
Schedule
6.20
REGISTRATION
RIGHTS
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1.
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Certain
Definitions.
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The
following capitalized terms used herein shall have the meanings set forth
below. All terms not defined herein shall have the meaning set forth
in the Agreement and Plan of Merger, dated as of March 30, 2010 (the “Merger Agreement”),
by and between FHB Formation LLC, a Delaware limited liability company, and
Northeast Bancorp, a Maine corporation.
“Filing Date” shall
have the meaning set forth in Section 2(a).
“FINRA” shall mean the
Financial Industry Regulatory Authority.
“Holder” shall mean an
Investor who receives shares of Surviving Company Common Stock pursuant to the
Merger Agreement.
“Initiating Holders”
shall have the meaning set forth in Section 3(a).
“Nine Month Anniversary
Date” shall have the meaning set forth in Section 2(a).
“Offering Blackout
Period” shall have the meaning set forth in Section 3(c).
“Prospectus” shall
mean the prospectus included in a Registration Statement, including any
preliminary prospectus, as amended or supplemented by any prospectus supplement
with respect to the terms of the offering of any portion of the Registrable
Shares covered by such Registration Statement, and by all other amendments and
supplements to such prospectus, including post-effective amendments, and in each
case including all material incorporated by reference therein.
“Registrable Shares”
shall mean all Surviving Company Voting Common Stock issued to Holders pursuant
to the Merger and any shares of Surviving Company Voting Common Stock or other
securities issued or issuable in respect of the shares of Surviving Company
Voting Common Stock upon conversion of Surviving Company Non-Voting Common Stock
or by way of spin-off, dividend or stock split or in connection with a
combination of shares, reclassification, merger, consolidation or
reorganization; provided,
however, that such shares of Surviving Company Voting Common Stock shall
not include (i) Surviving Company Voting Common Stock for which a
Registration Statement relating to the sale thereof shall have become effective
under the Securities Act and which have been disposed of, as applicable, under
such Registration Statement, and (ii) Surviving Company Voting Common Stock sold
pursuant to Rule 144; provided, further, that as to
any Registrable Shares, such securities shall cease to constitute “Registrable
Shares” from and after the date on which such securities may be freely sold
publicly without either registration under the Securities Act or compliance with
any restrictions or limitations, including without limitation restrictions as to
volume or manner of sales or public information requirements, under Rule
144.
“Registration Effectiveness
Date” shall have the meaning set forth in Section 2(a).
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“Registration
Expenses” shall mean any and all expenses incident to the performance of
or compliance with this Agreement, including without limitation: (a) all
registration and filing fees; (b) all fees and expenses associated with a
required listing of the Registrable Shares on any securities exchange; (c) fees
and expenses with respect to filings required to be made with the NASDAQ or
FINRA; (d) fees and expenses of compliance with securities or “blue sky” laws
(including reasonable fees and disbursements of counsel for the underwriters or
holders of securities in connection with blue sky qualifications of the
securities and determination of their eligibility for investment under the laws
of such jurisdictions); (e) printing expenses, messenger, telephone and delivery
expenses; (f) fees and disbursements of counsel for the Surviving Company and
customary fees and expenses for independent certified public accountants
retained by the Surviving Company (including the expenses of any comfort
letters, or costs associated with the delivery by independent certified public
accountants of a comfort letter or comfort letters, if such comfort letter or
comfort letters is required by the managing underwriter); (g) securities acts
liability insurance, if the Surviving Company so desires; (h) all internal
expenses of the Surviving Company (including, without limitation, all salaries
and expenses of its officers and employees performing legal or accounting
duties); (i) the expense of any annual audit; (j) the fees and expenses of any
person, including special experts, retained by the Surviving Company; and (k)
the reasonable out-of-pocket expenses of Holders, including, without limitation,
the expenses of a single counsel for Holders, in connection with the
Registration Statements filed by the Surviving Company pursuant to Section 2(a)
hereof; provided, however,
that Registration Expenses shall not include, and the Surviving Company
shall not have any obligation to pay, any underwriting fees, discounts, or
commissions attributable to the sale of such Registrable Shares, or any legal
fees and expenses of counsel to any Holder (except as specifically provided
above) and any underwriter engaged by any Holder.
“Registration
Statement” shall mean any registration statement of the Surviving Company
which covers the resale of any of the Registrable Shares under the Securities
Act on an appropriate form, and all amendments and supplements to such
registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
materials incorporated by reference therein.
“Resale Shelf Registration
Expiration Date” shall have the meaning set forth in
Section 2(a).
“Resale Shelf Registration
Statement” shall have the meaning set forth in Section 2(a).
“Rule 144” means Rule
144 under the Securities Act (or any successor provision).
“Surviving Company
Offering” shall have the meaning set forth in Section 3(c).
“Suspension Event”
shall have the meaning set forth in Section 3(b).
“Underwritten Demand
Notice” shall have the meaning set forth in Section 3(a).
“Underwritten Demand
Statement” shall have the meaning set forth in Section 3(a).
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2.
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Resale Registration
Rights.
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(a) Registration Statement
Covering Resale of Registrable Shares. At any time following
the date that is the nine month anniversary of the Effective Time (the “Nine Month Anniversary
Date”), a Holder or Holders then holding not less than five percent (5%)
of the issued and outstanding shares of Surviving Company Common Stock may, on
not more than three occasions in aggregate, request in writing that the
Surviving Company file a shelf registration statement (a “Resale Shelf Registration
Statement”) pursuant to Rule 415 under the Securities Act covering all of
the Registrable Shares to enable the resale on a delayed or continuous basis of
such Registrable Shares by the Holders. The Resale Shelf Registration
Statement shall be filed on Form S-3 (or any applicable successor form thereto)
with the SEC not later than 30 days following such request (such date of filing,
the “Filing
Date”). The Surviving Company shall use its commercially
reasonable efforts to have the Resale Shelf Registration Statement declared
effective under the Securities Act as expeditiously as practicable, but in no
event later than (i) 15 days following the Filing Date in the case where the SEC
does not elect to review the Resale Shelf Registration Statement, and (ii) 60
days following the Filing Date, in the case where the SEC elects to review the
Resale Shelf Registration Statement (such date of effectiveness, the “Registration Effectiveness
Date”). The Surviving Company agrees to use its commercially
reasonable efforts to maintain the effectiveness of the Resale Shelf
Registration Statement, including by filing any necessary post-effective
amendments and prospectus supplements, or, alternatively, by filing new
registration statements relating to the Registrable Shares as required by Rule
415 under the Securities Act, continuously until the date (the “Resale Shelf Registration
Expiration Date”) which is the earlier of (x) two years following the
Registration Effectiveness Date, or (y) the date on which all Registrable Shares
have been disposed of by the Holders.
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(b) Notification and
Distribution of Materials. The Surviving Company shall notify
the Holders of the effectiveness of any Registration Statement applicable to the
Registrable Shares and shall furnish to the Holders, without charge, such number
of copies of the Registration Statement (including any amendments, supplements
and exhibits), the Prospectus contained therein (including each preliminary
prospectus and all related amendments and supplements) and any documents
incorporated by reference in the Registration Statement or such other documents
as the Holders may reasonably request in order to facilitate the sale of the
Registrable Shares in the manner described in the Registration
Statement.
(c) Amendments and
Supplements. The Surviving Company shall promptly prepare and
file with the SEC from time to time such amendments and supplements to the
Registration Statement and Prospectus used in connection therewith as may be
necessary to keep the Registration Statement effective and to comply with the
provisions of the Securities Act with respect to the disposition of all the
Registrable Shares until the Resale Shelf Expiration Date. Upon five
Business Days’ notice, the Surviving Company shall file any supplement or
post-effective amendment to the Registration Statement with respect to the plan
of distribution or a Holder’s ownership interests in his, her or its Registrable
Shares that is reasonably necessary to permit the sale of such Holder’s
Registrable Shares pursuant to the Registration Statement.
(d) Notice of Certain
Events.
(i) The
Surviving Company shall promptly and in any event within three Business Days
notify the Holders of, and confirm in writing, any request by the SEC for any
amendment or supplement to, or additional information in connection with, any
Registration Statement required to be prepared and filed hereunder (or
Prospectus relating thereto). The Surviving Company shall promptly
and in any event within three Business Days notify each Holder of, and confirm
in writing, the filing of the Registration Statement or any Prospectus,
amendment or supplement related thereto or any post-effective amendment to the
Registration Statement and the effectiveness of any post-effective
amendment.
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(ii) At
any time when a Prospectus relating to the Registration Statement is required to
be delivered under the Securities Act to a transferee, the Surviving Company
shall immediately notify the Holders (A) 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 any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and (B) in such event, to suspend sales of Registrable
Shares. Subject to the provisions of Section 3 below, in such event,
the Surviving Company shall promptly, and in any event within ten Business Days,
prepare and file a supplement to or an amendment of such Prospectus as may be
necessary so that, as thereafter deemed delivered to the purchasers of
Registrable Shares sold under the Prospectus, such Prospectus shall not include
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they are made, not misleading. The
Surviving Company shall, if necessary, promptly, and in any event within ten
Business Days, amend the Registration Statement of which such Prospectus is a
part to reflect such amendment or supplement.
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3.
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Underwritten Offering
Rights
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(a) Subject
to the conditions set forth in this Agreement, at any time after the Nine Month
Anniversary Date, the Surviving Company shall, at the written request of any
Holder or Holders (the “Initiating Holders”)
to sell in an underwritten offering that number of Registrable Shares
(i) with an aggregate Fair Market Value of not less than $5,000,000 as of
the date of such request or (ii) equal to twenty-five percent (25%) of the
Registrable Shares (an “Underwritten Demand
Notice”), cause to be prepared and filed as soon as practicable after the
date of such request by such Initiating Holder either (i) a registration
statement or (ii) a (A) supplement, (B) post-effective amendment or
(C) Form 8-K incorporated by reference to the Resale Shelf Registration
Statement in accordance with the rules under the Securities Act (or such
other rule as is applicable to the proposed sale), in each case covering all or
a portion of such Registrable Shares for the purpose of effecting an
underwritten offering of such Registrable Shares (an “Underwritten Demand
Statement”); provided,
however, that the Surviving Company shall not be required to effect an
Underwritten Demand Statement pursuant to a request under this Section 3(a)
more than three times for the Holders of Registrable Shares collectively; provided, further, that no
Holder shall be entitled to demand an Underwritten Demand Statement during a
Suspension Event or Offering Blackout Period. A registration
requested pursuant to this Section 3(a) shall not count as one of the three
permitted Underwritten Demand Statements unless the Holders of Registrable
Shares participating in such Underwritten Demand Statement register at least
fifty percent (50%) (by number of shares) of the amount of Registrable Shares
requested to be included in such Underwritten Demand Statement.
(b) The
Surviving Company shall use its commercially reasonable efforts to have the
Underwritten Demand Statement declared effective under the Securities Act, if
required, as expeditiously as practicable. Any Underwritten Demand
Statement filed under this Section 3 shall reflect such plan or method of
distribution of the applicable securities as shall be designated by the managing
underwriter.
(c) Pursuant
to the exercise of each underwritten demand right, the Surviving Company shall
have the right to postpone the filing or the effectiveness of each Underwritten
Demand Statement pursuant to this Section 3 as provided in Section
4.
(d) Notwithstanding
anything to the contrary contained herein, no request may be made under this
Section 3 within 90 days after the effective date of an Underwritten Demand
Statement filed by the Surviving Company pursuant to any Underwritten Demand
Notice.
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(e) The
Initiating Holders shall be entitled to select nationally recognized investment
banks to act as the underwriters for such offering; provided, however, that, such
selection shall be subject to the consent of the Surviving Company (which
consent shall not be unreasonably withheld).
(f) The
Surviving Company shall make available members of the management of the
Surviving Company and its Affiliates for reasonable assistance in selling
efforts related to such offering (including, without limitation, senior
management attendance at due diligence meetings with underwriters and their
counsel and road shows) and shall enter into underwriting agreements containing
usual and customary terms and conditions for such types of offerings and take
all such other actions in connection therewith customarily undertaken by issuers
in order to expedite or facilitate the disposition of such Registrable Shares,
including without limitation: (i) make such representations and warranties to
the underwriters with respect to the business of the Surviving Company, the
Registration Statement, the Prospectus and any documents, if any, incorporated
or deemed to be incorporated by reference therein, as may reasonably be required
by the underwriters; (ii) obtain opinions of counsel to the Surviving Company
and updates thereof, addressed to Holders and each of the underwriters;
(iii) obtain “cold comfort” letters and updates thereof from the
independent certified public accountants of the Surviving Company addressed to
Holders and each of the underwriters; (iv) ensure that, if an underwriting
agreement is entered into, such agreement shall contain indemnification
provisions and procedures that are usual and customary for an offering of such
size; (v) file with the SEC a final Prospectus with respect to the offering that
satisfies the requirements of Section 10(a) of the Securities Act as soon as
practicable after the Registration Statement is declared effective and, in any
event, prior to the first scheduled date for delivery by the Holders to the
underwriters or purchasers of Registrable Securities in the offering and (vi)
deliver such documents and certificates as may be reasonably requested by the
underwriters and their respective counsel to evidence the continued validity of
the representations and warranties made pursuant to clause (i) of this Section
3(f).
(g) In
connection with an Underwritten Demand Statement, if the managing underwriter of
such offering determines that the number of securities sought to be offered
should be limited due to market conditions, then the number of securities to be
included in such underwritten public offering shall be reduced to a number
deemed satisfactory by such managing underwriter; provided, however, that
securities shall be excluded in the following sequence: (i) first, shares
of Surviving Company Voting Common Stock held by any stockholders not having
registration rights with regard to securities of the Surviving Company, (ii)
second, shares of Surviving Company Voting Common Stock held by stockholders
other than the holders of Registrable Shares having contractual, incidental
“piggy back” rights to include such securities in the registration statement,
(iii) third, shares of Surviving Company Voting Common Stock sought to be
registered by the Surviving Company for its own account and (iv) fourth,
Registrable Shares, it being understood that no shares of Surviving Company
Voting Common Stock shall be registered for the account of Parent or any
stockholder of the Surviving Company other than the Holders unless all
Registrable Shares for which holders thereof have requested registration have
been registered. If there is a reduction of some but not all of the
number of Registrable Shares pursuant to clauses (i) through (iv), such
reduction shall be made on a pro rata basis (based upon the aggregate number of
securities held by the holders in the applicable category and subject to the
priorities set forth in the preceding sentence).
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4.
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Suspension of
Registration Requirement; Restriction on
Sales.
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(a) The
Surviving Company shall as promptly as possible notify each Holder of, and
confirm in writing, the issuance by the SEC of any stop order suspending the
effectiveness of a Registration Statement with respect to such Holder’s
Registrable Shares or the initiation of any proceedings for that
purpose. The Surviving Company shall use its reasonable best efforts
to obtain the withdrawal of any order suspending the effectiveness of such a
Registration Statement at the earliest possible moment.
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(b) Notwithstanding
anything to the contrary set forth in this Agreement, the Surviving Company’s
obligation under this Agreement to file, amend or supplement a Registration
Statement, or to cause a Registration Statement, or any filings with any state
securities commission, to become effective shall be suspended, for one or more
reasonable periods not to exceed the period described in Section 5 below, if the
Board of Directors of the Surviving Company determines in good faith that such
suspension is in the best interests of the Surviving Company and its
shareholders in order to avoid the disclosure of information not otherwise then
required by law (in the absence of a registration or sales thereunder) to be
publicly disclosed or for another valid business purpose (any such circumstances
being hereinafter referred to as a “Suspension
Event”). The Surviving Company shall notify the Holders of the
existence of any Suspension Event by promptly delivering to each Holder a
certificate signed by an executive officer of the Surviving Company stating that
a Suspension Event has occurred and is continuing.
(c) Subject
to the terms of Section 5 below, each Holder of Registrable Shares agrees, if
requested by the managing underwriter or underwriters in a Surviving
Company-initiated underwritten offering (each, a “Surviving Company
Offering”), not to effect any public sale or distribution of any of the
Registrable Shares pursuant to a then effective Shelf Registration Statement or
if a Shelf Registration Statement is not then effective, not to request the
filing of a Shelf Registration Statement pursuant to Section 2 above or request
an Underwritten Demand Statement during the Offering Blackout
Period. The Surviving Company shall use reasonable best efforts to
give written notice to each Holder of any Offering Blackout Period at least 15
days prior to the commencement of the Offering Blackout Period; provided, however, that if
the Surviving Company is unable to provide 15 days advance notice of the
commencement of the Offering Blackout Period, the Surviving Company shall
provide as much notice as reasonably possible; provided, further, that the
failure to timely provide such notice shall not in any way prohibit the
commencement of an Offering Blackout Period. The “Offering Blackout
Period” shall commence on a date set by the Surviving Company, which
shall be no earlier than the fifteenth day preceding the anticipated date of
pricing of such Surviving Company Offering, and shall end on the earliest to
occur of:
(i) the
later to occur of 60 days after the closing date of such Surviving Company
Offering or one day after the date on which the closing price of the class of
equity securities sold by the Surviving Company in such Surviving Company
Offering shall have averaged for a period of 20 consecutive trading days at
least one hundred five percent (105%) of the initial price to the public of such
security in such Surviving Company Offering; or
(ii) the
date on which all directors and executive officers who have been required to
enter into contractual lock-up or similar restrictions on the sale of shares of
Surviving Company Voting Common Stock owned by them may begin to effect public
sales of shares of Surviving Company Voting Common Stock following such
Surviving Company Offering, including pursuant to waivers of the restrictions by
the managing underwriter or underwriters;
provided, however, that this
Subsection 4(c) shall not prohibit resales of Registrable Shares by any Holder
not subject to the registration requirements of the Securities Act (including,
without limitation resale of Registrable Shares pursuant to Rule 144) and
similarly exempt from any registration requirement under any state “blue sky” or
similar laws; provided,
further, that the purchaser in any private resale shall agree in writing
to be subject to such restrictions for the remaining portion of such period that
would otherwise apply to such Holder.
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Subject
to the terms of Section 5 below, each Holder agrees that, following the
Registration Effectiveness Date relating to Registrable Shares of such Holder,
such Holder will not effect any sales of the Registrable Shares pursuant to such
Registration Statement or any filings with any state securities commission at
any time after such Holder has received notice from the Surviving Company to
suspend sales as a result of the occurrence or existence of any Suspension Event
or so that the Surviving Company may correct or update the Registration
Statement or such filing. The Holders may recommence effecting sales
of the Registrable Shares pursuant to the Registration Statement or such
filings, and all other obligations which are suspended as a result of a
Suspension Event shall no longer be so suspended, following further notice to
such effect from the Surviving Company, which notice shall be given by the
Surviving Company not later than one Business Day after the conclusion of any
such Suspension Event.
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5.
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Limitations on
Suspension/Blackout Periods
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Notwithstanding
anything herein to the contrary, the Surviving Company covenants and agrees that
(a) the Surviving Company’s rights to suspend its obligation under the
agreements set forth herein to file, amend or supplement a Registration
Statement and maintain the effectiveness of any Registration Statement during
the pendency of any Suspension Event, (b) the Holders’ obligation to
suspend public sales of Registrable Shares during one or more Offering Blackout
Periods, and (c) the Holders’ obligations to suspend sales of Registrable Shares
pursuant to a Registration Statement during the pendency of any Suspension
Event, shall not, in the aggregate, cause the Holders to be required to suspend
sales of Registrable Shares or relieve the Surviving Company of its obligation
to file, amend or supplement and maintain the effectiveness of a Registration
Statement for longer than any 90 days during any 12 month period.
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6.
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Piggyback
Registration
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If the
Surviving Company proposes to register in an underwritten offering any of
Surviving Company Voting Common Stock under the Securities Act for sale to the
public (other than a registration effected solely to implement an employee
benefit plan or a transaction to which Rule 145 of the Securities Act is
applicable, or a registration statement on Form X-0, X-0 or another form not
available for registering the Registrable Shares for sale to the public, or in
connection with an Underwritten Demand Statement), each such time it will give
written notice at the applicable address of record to each Holder of Registrable
Shares of its intention to do so. Upon the written request of any of
such Holders of the Registrable Shares, given within ten Business Days after
receipt by such Person of such notice, the Surviving Company shall, subject to
the limits contained in this Section 6, use its commercially reasonable
efforts to cause all such Registrable Shares of the requesting Holders to be
registered under the Securities Act and qualified for sale under any state
securities or “blue sky” law, to the extent required to permit such sale or
other disposition of their Registrable Shares; provided, however, that if
the managing underwriter of such offering determines that the number of
securities sought to be offered should be limited due to market conditions, then
the number of securities to be included in such underwritten public offering
shall be reduced to a number deemed necessary by such managing
underwriter. Any shares eligible to be included pursuant to this
Section 6 will be excluded in the following order of priority:
(a) Surviving Company Voting Common Stock held by any shareholders not
having any such contractual, incidental “piggyback” registration rights, (b)
Surviving Company Voting Common Stock held by any shareholders having
contractual, incidental “piggyback” registration rights pursuant to an agreement
other than this Agreement, and (c) a portion of the Registrable Shares sought to
be included by the Holders thereof as determined pro rata based upon the
aggregate number of Registrable Shares held by such Holders.
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7.
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State Securities
Laws
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Subject
to the conditions set forth in this Agreement, the Surviving Company shall, in
connection with the filing of any Registration Statement hereunder, file such
documents as may be necessary to register or qualify the Registrable Shares
under the securities or “blue sky” laws of such states as the Holders may
reasonably request, and the Surviving Company shall use its commercially
reasonable efforts to cause such filings to become effective in a timely manner;
provided, however, that
the Surviving Company shall not be obligated to qualify as a foreign corporation
to do business under the laws of any such state in which it is not then
qualified or to file any general consent to service of process in any such
state. Once effective, the Surviving Company shall use its
commercially reasonable efforts to keep such filings effective until the earlier
of (a) such time as all of the Registrable Shares have been disposed of in
accordance with the intended methods of disposition by the Holders as set forth
in the applicable Registration Statement, (b) in the case of a particular
state, the applicable Holders have notified the Surviving Company that they no
longer require an effective filing in such state in accordance with their
original request for filing or (c) the date on which the applicable
Registration Statement ceases to be effective.
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8.
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Listing
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The
Surviving Company will cause all Registrable Shares to be listed or otherwise
eligible for full trading privileges on the principal national securities
exchange (currently NASDAQ) on which the shares of Surviving Company Voting
Common Stock are then listed or quoted, not later than the date on which the
Registrable Shares are issued by the Surviving Company to a
Holder. The Surviving Company will use commercially reasonable
efforts to continue the listing or trading privilege for all Registrable Shares
on such exchange. The Surviving Company will as promptly as
practicable notify the Holders of, and confirm in writing, the delisting of the
shares of Surviving Company Voting Common Stock by such exchange.
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9.
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Expenses
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The
Surviving Company shall bear all Registration Expenses incurred in connection
with the registration of the Registrable Shares pursuant to this Agreement and
the Surviving Company’s performance of its other obligations under the terms of
this Agreement.
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10.
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Indemnification by the
Surviving Company
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The
Surviving Company agrees to indemnify and hold harmless each Holder whose shares
are included in the Registration Statement, and if such Holder is not an
individual, such Holder’s directors, officers and each person, if any, that
controls a Holder whose shares are included in the Registration Statement within
the meaning of the Securities Act, against any losses, claims, damages, expenses
or liabilities to which such Holder or other such Person may become subject by
reason of any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any 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 insofar as such losses, claims,
damages, expenses or liabilities arise out of or are based upon information
furnished in writing to the Surviving Company by or on behalf of a Holder for
use in the Registration Statement. The Surviving Company shall have
the right to assume the defense and settlement of any claim or suit for which
the Surviving Company may be responsible for indemnification under this
Section 9 with counsel reasonably satisfactory to the indemnified
party. The indemnified party may participate in any such defense or
settlement, but the Surviving Company shall not be liable to such indemnified
party for any legal or other expenses incurred by such indemnified party in
connection with the defense thereof; provided, however, that (a)
if the Surviving Company fails to take reasonable steps necessary to defend in
good faith the action or proceeding within ten Business Days after receiving
notice from such indemnified party that the indemnified party believes it has
failed to do so; or (b) if such indemnified party who is a defendant in any
action or proceeding which is also brought against the Surviving Company shall
have reasonably concluded, based on the advice of counsel, that there may be one
or more legal defenses available to such indemnified party which are not
available to the Surviving Company; or (c) if representation of both parties by
the same counsel is impermissible under applicable standards of professional
conduct, then, in any such case, the indemnified party shall have the right to
assume or continue its own defense as set forth above (but with no more than one
firm of counsel for all indemnified parties in each jurisdiction) and the
Surviving Company shall be liable for any reasonable expenses
therefor. Each Holder whose shares are included in the Registration
Statement agrees, severally and not jointly with any other Holder, to indemnify
and hold harmless the Surviving Company and its directors, officers and each
Person, if any, that controls the Surviving Company within the meaning of the
Securities Act, against any losses, claims, damages, expenses or liabilities to
which the Surviving Company or other such Person may become subject by reason of
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, but only insofar as such losses, claims,
damages, expenses or liabilities arise out of or are based upon information
furnished in writing to the Surviving Company by or on behalf of such Holder for
use in the Registration Statement. No indemnifying party shall,
without the written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to, any
action or claim in respect of which indemnification or contribution may be
sought hereunder unless such settlement, compromise or judgment (a) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim, and (b) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified
party.
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11.
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Covenants of
Holders
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It shall
be a condition to the Surviving Company’s obligation under this Section 11 to
include any Holder as a selling stockholder in any Registration Statement that
such Holder (a) shall have provided promptly (and in any event within five
Business Days of the request therefor) such information and other materials as
the Surviving Company or its counsel shall reasonably request in connection with
the Registration Statement and (b) shall have promptly taken all such actions as
the Surviving Company shall reasonably request in connection with the
Registration Statement. Each Holder hereby represents, warrants and
agrees that all such information provided by such Holder or on its behalf shall
be true, complete and correct in all material respects. Each Holder
further agrees that if it shall become aware of any information that would cause
any of the statements in the Registration Statement with respect to such Holder
to be false or misleading with respect to any material fact, or to omit to state
any material fact necessary to make such statements therein not false or
misleading, it shall promptly inform the Surviving Company in writing, and the
Surviving Company shall use its commercially reasonable efforts to promptly
amend or supplement the Registration Statement. Each Holder shall
comply with the Securities Act and any other laws applicable to any disposition
of any Registrable Securities pursuant to any Registration
Statement. The information regarding the Surviving Company included
or incorporated by reference in the Registration Statement shall not at the time
the Registration Statement is filed with the SEC and at the time it becomes
effective under the Securities Act contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading. The
information regarding the Surviving Company included or incorporated by
reference in any Prospectus relating to the Registration Statement, as then
amended or supplemented, shall not, as of the date such Prospectus, as then
amended or supplemented, is delivered to the Holder, contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in light of the circumstances under which
they are made, not misleading. Subject to the terms of this Section
11, if the Surviving Company becomes aware of any information that would cause
any of the statements in the Registration Statement or any Prospectus related
thereto, as then amended or supplemented, with respect to the Surviving Company
to be false or misleading with respect to any material fact, or to omit to state
any material fact necessary to make such statements not false or misleading, the
Surviving Company shall use its reasonable best efforts to promptly amend or
supplement the Registration Statement or such Prospectus.
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12.
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Contribution
|
If the
indemnification provided for in Section 10 is unavailable to an indemnified
party with respect to any losses, claims, damages, expenses or liabilities
referred to therein or is insufficient to hold the indemnified party harmless as
contemplated therein, then the indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, expenses or
liabilities in such proportion as is appropriate to reflect the relative fault
of the indemnifying party, on the one hand, and the indemnified party, on the
other hand, in connection with the statements or omissions which resulted in
such losses, claims, damages, expenses or liabilities as well as any other
relevant equitable considerations. The relative fault of the
indemnifying party, on the one hand, and of the indemnified party, on the other
hand, shall be determined by reference to, among other factors, whether the
untrue or alleged untrue statement of a material fact or omission or alleged
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. The Surviving Company and the Holders agree
that it would not be just and equitable if contribution pursuant to this
Section 12 were determined by pro rata allocation or by any
other method of allocation that fails to take account of the equitable
considerations referred to above. No Holder shall be required to
contribute any amount in excess of the amount by which the net proceeds to such
Holder from the sale of such Holder’s Registrable Securities pursuant to the
Registration Statement exceeds the amount of any damages which such Holder has
otherwise paid or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation.
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13.
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No Other Obligation to
Register; Rule 144
Information
|
Except as
otherwise expressly provided in this Agreement, the Surviving Company shall have
no obligation to the Holders to register the Registrable Shares under the
Securities Act. The Surviving Company shall use its best efforts to
file with the SEC such information as is required under the Exchange Act for so
long as there are holders of Registrable Shares; and in such event, the
Surviving Company shall use its best efforts to take all action as may be
required as a condition to the availability of Rule 144. The
Surviving Company shall furnish to any Holder of Registrable Shares upon request
a written statement executed by the Surviving Company as to the steps it has
taken to comply with the current public information requirement of Rule
144. The Surviving Company shall use its best efforts to facilitate
and expedite transfers of Registrable Shares pursuant to Rule 144, which efforts
shall include timely notice to its transfer agent to expedite such transfers of
Registrable Shares accompanied by any required authorizations by the Surviving
Company and opinions of Surviving Company counsel.
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14.
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Amendments and
Waivers
|
The
provisions of this Agreement may not be amended, modified, or supplemented or
waived without the prior written consent of (i) the Surviving Company, (ii)
Holders of a majority of the aggregate outstanding Registrable Shares, and
(iii) Specified Holders of ninety percent (90%) of the aggregate
outstanding Registrable Shares; provided, however, that no such
amendment, modification, supplement or waiver may materially adversely affect
the rights of or materially alter the obligations of a Holder with respect to
such Holder’s Registrable Shares disproportionately generally vis-à-vis other Holders of
Registrable Shares without such Holder’s prior written consent. A
“Specified Holder” is a Holder that is or may be deemed to be an
“affiliate” (as that term is defined in Rule 12b-2 of the Exchange Act) of the
Surviving Company or that has one or more representatives serving as a director,
observer, adviser or consultant of the Surviving Company.
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15.
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Notices
|
Except as
set forth below, all notices and other communications provided for or permitted
hereunder shall be in writing and shall be deemed to have been duly given when
and if delivered personally or sent by facsimile (with respect to notice by
facsimile, on a Business Day between the hours of 8:00 a.m. and 5:00 p.m., New
York time), five Business Days after being sent if mailed by registered or
certified mail (return receipt requested), postage prepaid, or upon receipt if
sent by courier or overnight delivery service to the respective parties at the
following addresses (or at such other address for any party as shall be
specified by like notice; provided, however, that
notices of a change of address shall be effective only upon receipt
thereof):
If to the
Surviving Company:
Northeast
Bancorp
000 Xxxxx
Xxxxxx
Xxxxxxxx,
XX 00000
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Attention:
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Chief
Executive Officer
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Facsimile:
|
(000)
000-0000
|
With
copies to:
Xxxxxxx
Xxxxxxx XXX
Xxxxxxxx
Xxxxx
Xxxxxx,
XX 00000
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Attention:
|
Xxxxxxx
X. Xxxxx, Esq.
|
| Xxxxx X. Xxxxxxxx, Esq. |
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Facsimile
|
(000)
000-0000
|
If to the
Holders:
At the
respective addresses set forth in the Equity Commitment Letters.
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16.
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Successors and
Assigns
|
The
agreements set forth herein shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the parties
hereto and their respective successors and assigns. If any successor,
assignee or transferee of any Holder shall acquire Registrable Shares in any
manner, whether by operation of law or otherwise, (a) such successor,
assignee or transferee shall be entitled to all of the benefits of a “Holder”
hereunder and (b) such Registrable Shares shall be held subject to all of the
terms hereunder, and by taking and holding such Registrable Shares such Person
shall be conclusively deemed to have agreed to be bound by all of the terms and
provisions hereof.
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17.
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Governing
Law
|
The
agreements set forth herein shall be governed by, and interpreted in accordance
with, the laws of the State of Delaware, without regard to the conflict of law
principles thereof. The Surviving Company and each Holder
(a) consents to submit itself to the exclusive personal jurisdiction of the
Delaware Court of Chancery, New Castle County, or if that court does not have
jurisdiction, a federal court sitting in the State of Delaware (the “Delaware Courts”) in
any action or proceeding arising out of or relating to the agreements set forth
herein, (b) agrees that all claims in respect of such action or proceeding
may be heard and determined in any such court, (c) agrees that it will not
attempt to deny or defeat such personal jurisdiction by motion or other request
for leave from any such court, and (d) agrees not to bring any action or
proceeding arising out of or relating to the agreements set forth herein in any
other court. The Surviving Company and each Holder waives any defense
or inconvenient forum to the maintenance of any action or proceeding so brought
and waives any bond, surety or other security that might be required of any
other party with respect thereto. To the extent permitted by
applicable law, any party hereto may make service on another party by sending or
delivering a copy of the process to the party to be served at the address and in
the manner provided for the giving of notices in Section 9.5 in the case of the
Surviving Company and, in the case of the Holder, by sending or delivering a
copy of the process to the party to be served at the address of the Holder set
forth in such Holder’s Equity Commitment Letter. Nothing in this
Section 17, however, shall affect the right of any party to serve legal process
in any other manner permitted by law. THE SURVIVING COMPANY AND EACH
HOLDER HEREBY IRREVOCABLY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO THE AGREEMENTS SET FORTH HEREIN.
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18.
|
Severability
|
In the
event that any one or more of the provisions contained herein, or the
application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be in any way impaired thereby, it being
intended that all of the rights and privileges of the parties hereto shall be
enforceable to the fullest extent permitted by law.
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19.
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Entire
Agreement
|
The
agreements set forth herein and the Equity Commitment Letters are intended by
the parties as a final expression of their agreement and intended to be the
complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained
herein. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein, with respect to
such subject matter. The agreements set forth herein supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
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