REGISTRATION RIGHTS AGREEMENT
This AGREEMENT (this "Agreement"), dated as of March 28,
1997, is entered into among Meridian Financial Corporation,
an Indiana corporation (the "Company"), and those parties
listed under the heading "Shareholders" on the signature page
to this Agreement (the "Shareholders").
WHEREAS, pursuant to a Securities Purchase Agreement dated as
of March 28, 1997, the Shareholders have, concurrently with
the execution of this Agreement, purchased from the Company
shares of its Series C Convertible Preferred Stock
("Preferred Shares"); and
WHEREAS, the Company and the Shareholders desire to provide a
mechanism for the registration of the Conversion Shares (as
defined in Section 1(c)) and certain other securities of the
Company that may hereafter be issued in respect of the
Conversion Shares;
NOW, THEREFORE, in consideration of the premises and the
representations, warranties and agreements contained herein
and intending to be legally bound hereby, the parties hereto
agree as follows:
SECTION .Definitions. For purposes of this Agreement, the
following terms shall have the following meanings:
()The term "Commission" shall have the meaning assigned
thereto in Section 2(c) of this Agreement.
()The term "Company Common Stock" means the common stock, no
par value, of the Company.
()The term "Conversion Shares" means the shares of Company
Common Stock issuable upon conversion of Preferred Shares;
()The term "Demand" shall have the meaning assigned thereto
in Section 2(a) of this Agreement.
()The term "Demand Registration" shall have the meaning
assigned thereto in Section 2(a) of this Agreement.
()The term "Demanding Sellers" shall have the meaning
assigned thereto in Section 2(e) of this Agreement.
()The term "Internal Expenses" shall have the meaning
assigned thereto in Section 7 of this Agreement.
()The term "Maximum Demand Number" shall have the meaning
assigned thereto in Section 2(e) of this Agreement.
()The term "Maximum Piggyback Number" shall have the meaning
assigned thereto in Section 3(b) of this Agreement.
()The term "Other Demand Rights" shall have the meaning
assigned thereto in Section 3(b) of this Agreement.
()The term "Other Demanding Sellers" shall have the meaning
assigned thereto in Section 3(b) of this Agreement.
()The term "Person" means any individual, firm, corporation,
partnership, limited liability company or other entity, and
shall include any successor (by merger or otherwise) of such
entity.
()The term "Piggyback Notice" shall have the meaning assigned
thereto in Section 3(a) of this Agreement.
()The term "Piggyback Registration" shall have the meaning
assigned thereto in Section 3(a) of this Agreement.
()The term "Piggyback Seller" shall have the meaning assigned
thereto in Section 3(b) of this Agreement.
()The term "Primary Offering" shall have the meaning assigned
thereto in Section 3(b) of this Agreement.
()The term "Registrable Securities" means (i) the Conversion
Shares and (ii) securities issued or issuable with respect to
the Conversion Shares (or other Registrable Securities by
virtue of this clause (ii)) by way of a dividend, stock
split, combination of shares, recapitalization,
reorganization, reclassification, merger, consolidation,
compulsory share exchange or any transaction or series of
related transactions in which Preferred Shares, shares of
Company Common Stock or Registrable Securities are changed
into, converted into or exchanged for other securities. As to
any particular Registrable Securities, such securities shall
cease to be Registrable Securities when (i) a registration
statement registering such securities under the Securities
Act has been declared effective and such securities have been
sold or otherwise transferred by the holder thereof pursuant
to such registration statement or (ii) such securities are
sold in compliance with Rule 144. For purposes of this
Agreement, a Person will be deemed to be a holder of
Registrable Securities whenever such Person has the right to
acquire such Registrable Securities from the Company (by
conversion, exercise or otherwise, including, without
limitation, by conversion of Preferred Shares) whether or not
such acquisition has actually been effected; provided,
however, that if more than one Person would be deemed to be
the holder of Registrable Securities by virtue of this
sentence, then the Person who then owns such Registrable
Securities shall be deemed to be the holder thereof; provided
further, that the Company need not recognize any Person as a
holder of Registrable Securities unless such Person acquired
such Registrable Securities (or the securities evidencing the
right to acquire Registrable Securities) from the Company or
unless such Person otherwise appears as a holder of record of
such Registrable Securities (or such securities evidencing
such right) on the books and records of the Company.
()The term "Registration Expenses" shall have the meaning
assigned thereto in Section 7 of this Agreement.
()The term "Requisite Amount" means 60% of the then
outstanding Registrable Securities.
()The term "Rule 144" means Rule 144 (or any successor
provisions) promulgated under the Securities Act.
()The term "Securities Act" shall have the meaning assigned
thereto in Section 2(a) of this Agreement.
SECTION .Demand Registrations.
()Requests for Registration. At any time and from time to
time after the earlier to occur of (i) the fourth anniversary
of the date of this Agreement and (ii) the closing of the
first registered public offering of equity securities of the
Company, holders of the Requisite Amount of Registrable
Securities shall be entitled to make written requests of the
Company (each such request being a "Demand") for registration
under the Securities Act of 1933, as amended (the "Securities
Act"), of all or part of the Registrable Securities (a
"Demand Registration"). Such Demand shall specify: (i) the
aggregate number and kind of Registrable Securities requested
to be registered; and (ii) the intended method of
distribution in connection with such Demand Registration to
the extent then known. No Demand shall be effective or impose
any obligation upon the Company unless such Demand shall
request the registration of not less than the Requisite
Amount of Registrable Securities. Within ten days after
receipt of a Demand, the Company shall give written notice of
such Demand to all other holders of Registrable Securities
and shall include in such registration all Registrable
Securities of each holder thereof with respect to which the
Company has received a written request for inclusion therein
within 20 days after the receipt by such holder of the
Company's notice required by this paragraph.
()Number of Demand Registrations. The holders of Registrable
Securities shall be entitled to two Demand Registrations.
()Satisfaction of Obligations. Subject to Section 4, a
registration shall not be treated as a Demand Registration
until (i) the applicable registration statement under the
Securities Act has been filed with the Securities and
Exchange Commission (the "Commission") with respect to such
Demand Registration and (ii) such registration statement
shall have been maintained continuously effective for a
period of at least 120 days or such shorter period when all
Registrable Securities included therein have been sold
thereunder in accordance with the manner of distribution set
forth in such registration statement.
()Restrictions on Demand Registrations. The Company shall
not be obligated to file any Demand Registration within 180
days after the effective date of a so-called "firm
commitment" underwritten registration in which all holders of
Registrable Securities were given so-called "piggyback"
rights pursuant to Section 3 hereof (provided that, with
respect to such a registration in which such piggyback rights
were exercised, each such holder exercising such piggyback
rights was permitted to include in such registration all
Registrable Securities that such holder sought to include
therein). In addition, the Company shall be entitled to
postpone (upon written notice to all holders of Registrable
Securities) the filing or the effectiveness of a registration
statement in respect of a Demand (x) for up to 90 days (but
no more than once in any period of nine consecutive months
and no more than two times in total) if the Company's Board
of Directors determines in good faith and in its reasonable
judgment that effecting the Demand Registration in respect of
such Demand would (i) have a material adverse effect on any
proposal or plan by the Company to engage in any material,
public debt or equity financing, acquisition or disposition
of assets (other than in the ordinary course of business) or
any material merger, consolidation, tender offer or other
similar transaction (in each case, authorization for the
negotiation of which has been obtained from the Board of
Directors of the Company prior to the service of such Demand)
or (ii) involve disclosure obligations contrary to the
Company's best interests or (y) until such time as a
registration statement may be filed and become effective
without the necessity of the Company having conducted any
special audit of its financial statements solely for the
purpose of such registration, unless the holders of the
Registrable Securities sought to be registered in such Demand
agree to pay one-half the costs of any such special audit.
()Participation in Demand Registrations. Neither the Company
nor any other Person shall include any securities other than
Registrable Securities in a Demand Registration, except with
the written consent of the holders of the majority of the
Registrable Securities sought to be registered pursuant to
such Demand Registration. If, in connection with a Demand
Registration, any managing underwriter (or, if such Demand
Registration is not an underwritten offering, a nationally
recognized independent underwriter selected by the holders of
a majority of the Registrable Securities sought to be
registered in such Demand Registration (which such
underwriter shall be reasonably acceptable to the Company and
whose fees and expenses shall be borne solely by the
Company)) advises the Company and the holders of the
Registrable Securities sought to be included in such Demand
Registration that, in its opinion, the inclusion of all the
Registrable Securities and, if authorized pursuant to this
paragraph, other securities of the Company, in each case,
sought to be registered in connection with such Demand
Registration would adversely affect the marketability of the
Registrable Securities sought to be sold pursuant thereto,
then the Company shall include in the registration statement
applicable to such Demand Registration only such securities
as the Company and the holders of Registrable Securities
sought to be registered therein ("Demanding Sellers") are
advised by such underwriter can be sold without such an
effect (the "Maximum Demand Number"), as follows and in the
following order of priority:
()first, the number of Registrable Securities sought to be
registered by each Demanding Seller, pro rata in proportion
to the number of Registrable Securities sought to be
registered by all Demanding Sellers; and
()second, if the number of Registrable Securities to be
included under clause (i) next above is less than the Maximum
Demand Number, the number of securities sought to be included
by each other seller, pro rata in proportion to the number of
securities sought to be sold by all such other sellers, which
in the aggregate, when added to the number of securities to
be included pursuant to clause (i) next above, equals the
Maximum Demand Number.
()Selection of Underwriters. If the holders of a majority of
the Registrable Securities sought to be registered in a
Demand Registration request that such Demand Registration be
an underwritten offering, then such holders shall select a
nationally recognized underwriter or underwriters to manage
and administer such offering, such underwriter or
underwriters, as the case may be, to be subject to the
approval of the Company's Board of Directors, which such
approval shall not be unreasonably withheld.
()Other Registrations. If the Company has received a Demand
pursuant to this Section 2 and if the applicable registration
statement in respect of such Demand has not been withdrawn or
abandoned, the Company will not file or cause to be effected
any other registration of any of its equity securities or
securities convertible or exchangeable into or exercisable
for its equity securities under the Securities Act (except on
Form S-4 or S-8 or any successor form), whether on its own
behalf or at the request of any holder or holders of such
securities, until a period of at least 120 days has elapsed
from the effective date of a firm commitment underwritten
Demand Registration (or, if later, the date of an
underwriting agreement with respect thereto) or a period of
at least 90 days has elapsed from the effective date of any
other Demand Registration, unless, in each case, a shorter
period of time is approved by the holders of a majority of
the Registrable Securities included in such Demand
Registration.
SECTION .Piggyback Registrations.
()Right to Piggyback. At any time from and after the date
hereof, whenever the Company proposes to register any of its
equity securities under the Securities Act (other than
pursuant to a Demand Registration or on a Form S-4 or S-8 (or
any successor form)) (a "Piggyback Registration"), the
Company shall give all holders of Registrable Securities
prompt written notice thereof (but not less than 30 days
prior to the filing by the Company with the Commission of any
registration statement with respect thereto). Such notice (a
"Piggyback Notice") shall specify, at a minimum, to the
extent known, the number and kind of securities proposed to
be registered, the proposed date of filing of such
registration statement with the Commission, the proposed
means of distribution, the proposed managing underwriter or
underwriters (if any and if known), and a good faith estimate
by the Company of the proposed minimum offering price of such
securities, as such price is proposed to appear on the facing
page of such registration statement. Upon the written
request of a holder of Registrable Securities given within
ten business days of such holder's receipt of the Piggyback
Notice (which written request shall specify the number and
kind of Registrable Securities intended to be disposed of by
such holder and the intended method of distribution thereof),
the Company shall include in such registration all
Registrable Securities with respect to which the Company has
received such written requests for inclusion; provided that
such holder sells such Registrable Securities only in
accordance with the method of distribution selected by the
Company or in accordance with any other method of
distribution which may be approved by the managing
underwriter of such offering.
()Priority on Piggyback Registrations. If, in connection
with a Piggyback Registration, any managing underwriter (or,
if such Piggyback Registration is not an underwritten
offering, a nationally recognized independent underwriter
selected by the Company (reasonably acceptable to the holders
of a majority of the Registrable Securities sought to be
included in such Piggyback Registration and whose fees and
expenses shall be borne solely by the Company)) advises the
Company and the holders of the Registrable Securities to be
included in such Piggyback Registration, that, in its
opinion, the inclusion of all the securities sought to be
included in such Piggyback Registration by the Company, any
Persons who have sought to have shares registered thereunder
pursuant to rights to demand (other than pursuant to so-
called "piggyback" or other incidental or participation
registration rights) such registration (such demand rights
being "Other Demand Rights" and such Persons being "Other
Demanding Sellers"), any holders of Registrable Securities
seeking to sell such securities in such Piggyback
Registration ("Piggyback Sellers") and any other proposed
sellers, in each case, if any, would adversely affect the
marketability of the securities sought to be sold pursuant
thereto, then the Company shall include in the registration
statement applicable to such Piggyback Registration only such
securities as the Company and the Piggyback Sellers are so
advised by such underwriter can be sold without such an
effect, which may exclude any class of Registrable Securities
if, in the judgment of such underwriter, the inclusion of
such Registrable Securities would adversely affect the
marketability of the securities sought to be sold pursuant
thereto (the "Maximum Piggyback Number"), as follows and in
the following order of priority:
()if the Piggyback Registration is an offering on behalf of
the Company and not any Person exercising Other Demand Rights
(whether or not other Persons seek to include securities
therein pursuant to so-called "piggyback" or other incidental
or participatory registration rights) (a "Primary Offering"),
then (A) first, such number of securities to be sold by the
Company as the Company shall have determined, (B) second, if
the number of securities to be included under clause (A) next
above is less than the Maximum Piggyback Number, the number
of Registrable Securities of each Piggyback Seller, pro rata
in proportion to the number of securities sought to be
registered by all the Piggyback Sellers, which in the
aggregate, when added to the number of securities to be
registered under clause (A) next above, equals the Maximum
Piggyback Number and (C) third, if the number of securities
to be included under clauses (A) and (B) next above is less
than the Maximum Piggyback Number, the number of securities
of each other proposed seller, pro rata in proportion to the
number of securities sought to be registered by all such
other proposed sellers, which in the aggregate, when added to
the number of securities to be registered under clauses (A)
and (B) next above, equals the Maximum Piggyback Number;
()if the Piggyback Registration is an offering other than
pursuant to a Primary Offering, then (A) first, such number
of securities sought to be registered by each Other Demanding
Seller, pro rata in proportion to the number of securities
sought to be registered by all such Other Demanding Sellers,
(B) second, if the number of securities included under clause
(A) next above is less than the Maximum Piggyback Number, the
number of securities sought to be registered by each
Piggyback Seller, pro rata in proportion to the number of
securities sought to be registered by all the Piggyback
Sellers, which in the aggregate, when added to the number of
securities to be registered pursuant to clause (A) next
above, equals the Maximum Piggyback Number and (C) third, if
the number of securities to be included under clauses (A) and
(B) next above is less than the Maximum Piggyback Number, the
number of securities of each other proposed seller, pro rata
in proportion to the number of securities sought to be
included by all such other proposed sellers, which in the
aggregate, when added to the number of securities to be
registered under clauses (A) and (B) next above, equals the
Maximum Piggyback Number.
()Withdrawal by the Company. If, at any time after giving
written notice of its intention to register any of its
securities as set forth in Section 3(a) and prior to the time
the registration statement filed in connection with such
registration is declared effective, the Company shall
determine for any reason not to register such securities, the
Company may, at its election, give written notice of such
determination to each holder of Registrable Securities and
thereupon shall be relieved of its obligation to register any
Registrable Securities in connection with such particular
withdrawn or abandoned registration (but not from its
obligation to pay the Registration Expenses in connection
therewith as provided herein).
SECTION .Withdrawal Rights. Any holder of Registrable
Securities having notified or directed the Company to include
any or all of its Registrable Securities in a registration
statement under the Securities Act (whether pursuant to
Section 2 or 3 hereof) shall have the right to withdraw any
such notice or direction with respect to any or all of the
Registrable Securities designated for registration thereby by
giving written notice to such effect to the Company prior to
the effective date of such registration statement. In the
event of any such withdrawal, the Company shall not include
such Registrable Securities in the applicable registration
and such Registrable Securities shall continue to be
Registrable Securities hereunder. No such withdrawal shall
affect the obligations of the Company with respect to the
Registrable Securities not so withdrawn; provided that in the
case of a registration pursuant to Section 2 hereof, if such
withdrawal shall reduce the number of Registrable Securities
sought to be included in such registration below the
Requisite Amount, then the Company shall as promptly as
practicable give each holder of Registrable Securities so to
be registered notice to such effect, referring to this
Agreement and summarizing this Section, and within five
business days following the effectiveness of such notice,
either the Company or the holders of a majority of the
Registrable Securities may, by written notice to each holder
of Registrable Securities or the Company, respectively, elect
that such registration statement not be filed or, if
theretofore filed, be withdrawn. During such five business
day period, the Company shall not file such registration
statement if not theretofore filed or, if such registration
statement has been theretofore filed, the Company shall not
seek, and shall use its best efforts to prevent, the
effectiveness thereof. Any registration statement not filed
or withdrawn in accordance with an election by the Company or
the holders of Registrable Securities shall not be counted as
a Demand for purposes of Section 2 hereof.
SECTION .Holdback Agreements.
()Holders. Each holder of Registrable Securities agrees not
to effect any public sale or distribution (including sales
pursuant to Rule 144) of equity securities of the Company, or
any securities convertible into or exchangeable or
exercisable for such securities, during the seven days
immediately prior to and the 120-day period beginning on the
effective date of any Demand Registration or (excluding sales
pursuant to Rule 144) any Piggyback Registration (in each
case, except as part of such registration and whether or not,
in the case of a Piggyback Registration, any Registrable
Securities are included therein), or, in each case, if later,
the date of any underwriting agreement with respect thereto.
The holders of a majority of the Registrable Securities
included in a Demand Registration may waive the limitation
contained in this paragraph with respect to such Demand
Registration.
()The Company. The Company agrees (i) not to effect, whether
for itself or for any other Person, any public sale or
distribution of its securities of the same class as any
Registrable Securities to be registered by the Company
pursuant to this Agreement, or any securities convertible
into or exchangeable or exercisable for such securities,
during the seven days immediately prior to and the 120-day
period beginning on the effective date of any registration in
connection with a Demand Registration or a Piggyback
Registration with respect to such Registrable Securities
(except as part of such registration to the extent permitted
pursuant to this Agreement or pursuant to registrations on
Form S-4 or Form S-8 (or any successor form)) or, in each
case, if later, the date of any underwriting agreement with
respect thereto, and (ii) in connection with a Demand
Registration will use reasonable efforts to cause each of the
Company's officers and each holder (other than a holder of
Registrable Securities and a holder eligible to report its
holdings on Schedule 13G pursuant to Section 13(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act")) of at least 5% of its Common Stock, or Common Stock
and any securities convertible into or exchangeable or
exercisable for Common Stock, representing, in the aggregate,
at least 5% of the Common Stock (on a fully diluted basis) to
agree not to effect any public sale or distribution
(excluding sales pursuant to Rule 144) of any such securities
during such period (except as part of such registration to
the extent permitted pursuant to the terms of this
Agreement). This Section 5(b) shall not be deemed to limit
the exercise of Demands hereunder by the holders of
Registrable Securities and the disposition of such securities
by such holders as permitted by the other terms of this
Agreement.
SECTION .Registration Procedures. Whenever the holders of
Registrable Securities have requested that any Registrable
Securities be registered pursuant to this Agreement (whether
pursuant to Section 2 or Section 3 of this Agreement), the
Company shall use its best efforts to effect the registration
and the sale of such Registrable Securities in accordance
with the intended method of disposition thereof and, in
connection therewith, the Company shall as expeditiously as
possible:
()prepare and file with the Commission a registration
statement with respect to such Registrable Securities, on any
form for which the Company then qualifies and which counsel
for the Company shall deem appropriate for the sale of such
Registrable Securities in accordance with the intended method
of distribution thereof, and use its best efforts to cause
such registration statement to become effective;
()prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such
registration statement effective for a continuous period of
not less than 120 days (or, if earlier, until all Registrable
Securities included in such registration statement have been
sold thereunder in accordance with the manner of distribution
set forth therein) and comply with the provisions of the
Securities Act with respect to the disposition of all
securities covered by such registration statement during such
period in accordance with the intended methods of disposition
by the sellers thereof as set forth in such registration
statement (including, without limitation, by incorporating in
a prospectus supplement or post-effective amendment, at the
request of a seller of Registrable Securities, the terms of
the sale of such Registrable Securities);
()before filing with the Commission any such registration
statement or prospectus or any amendments or supplements
thereto, the Company shall furnish to counsel selected by the
holders of a majority of the Registrable Securities covered
by such registration statement and counsel for the
underwriter or sales or placement agent, if any, in
connection therewith, drafts of all such documents proposed
to be filed and provide such counsel with a reasonable
opportunity for review thereof and comment thereon, such
review to be conducted and such comments to be delivered with
reasonable promptness;
()promptly (i) notify the selling holders of Registrable
Securities of each of (x) the filing and effectiveness of the
registration statement and prospectus and any amendments or
supplements thereto, (y) the receipt of any comments from the
Commission or any state securities law authorities or any
other governmental authorities with respect to any such
registration statement or prospectus or any amendments or
supplements thereto and (z) any oral or written stop order
with respect to such registration, any suspension of the
registration or qualification of the sale of such Registrable
Securities in any jurisdiction or any initiation or
threatening of any proceedings with respect to the foregoing
and (ii) use its best efforts to obtain the withdrawal of any
order suspending the registration or qualification (or the
effectiveness thereof) or suspending or preventing the use of
any related prospectus in any jurisdiction with respect
thereto;
()furnish to each seller of Registrable Securities, the
underwriters and the sales or placement agent, if any, and
counsel for each of the foregoing, a conformed copy of such
registration statement and each amendment and supplement
thereto (in each case, including all exhibits thereto and
documents incorporated by reference therein) and such
additional number of copies of such registration statement,
each amendment and supplement thereto, the prospectus
(including each preliminary prospectus) included in such
registration statement and prospectus supplements and all
exhibits thereto and documents incorporated by reference
therein and such other documents as such seller, underwriter,
agent or counsel may reasonably request in order to
facilitate the disposition of the Registrable Securities
owned by such seller, the use of each of which thereby and
therefor to which the Company hereby consents;
()if requested by the managing underwriter or underwriters of
any registration or by the holders of a majority of the
Registrable Securities included in any registration
statement, subject to approval of counsel to the Company in
its reasonable judgment, promptly incorporate in a
prospectus, supplement or post-effective amendment to the
registration statement such information concerning
underwriters and the plan of distribution of the Registrable
Securities as such managing underwriter or underwriters or
such holders reasonably shall furnish to the Company in
writing and request be included therein, including, without
limitation, with respect to the number of Registrable
Securities being sold by such holders to such underwriter or
underwriters and the purchase price being paid therefor by
such underwriter or underwriters; and make all required
filings of such prospectus, supplement or post-effective
amendment as soon as reasonably possible after being notified
of the matters to be incorporated in such prospectus,
supplement or post-effective amendment;
()use its best efforts to register or qualify such
Registrable Securities under such securities or "blue sky"
laws of such jurisdictions as any seller reasonably requests
and do any and all other acts and things which may be
reasonably necessary or advisable to enable such seller to
consummate the disposition in such jurisdictions of the
Registrable Securities owned by such seller and keep such
registration or qualification in effect for so long as the
registration statement remains effective under the Securities
Act (provided that the Company shall not be required to (i)
qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this
paragraph or (ii) subject itself to taxation in any such
jurisdiction where it would not otherwise be subject to
taxation but for this paragraph);
()notify each seller of such Registrable Securities, at any
time when a prospectus relating thereto is required to be
delivered under the Securities Act, upon the discovery that,
or of the happening of any event as a result of which, the
registration statement covering such Registrable Securities,
as then in effect, contains an untrue statement of a material
fact or omits to state any material fact required to be
stated therein or any fact necessary to make the statements
therein not misleading, and promptly prepare and furnish to
each such seller a supplement or amendment to the prospectus
contained in such registration statement so that such
Registration Statement shall not, and such prospectus as
thereafter delivered to the purchaser of such Registrable
Securities shall not, contain an untrue statement of a
material fact or omit to state any material fact required to
be stated therein or any fact necessary to make the
statements therein not misleading;
()cause all such Registrable Securities to be listed on each
securities exchange and included in each established over-
the-counter market on which or through which securities of
the same class of the Company are then listed or traded and,
if not so listed or traded, to be listed on the National
Association of Securities Dealers Automated Quotation system
("NASDAQ") and if listed on NASDAQ, use its reasonable
efforts to secure designation of all such Registrable
Securities covered by such registration statement as a NASDAQ
"national market system security" within the meaning of Rule
11Aa2-1 under the Exchange Act, or, failing that, to secure
NASDAQ authorization for such Registrable Securities and,
without limiting the generality of the foregoing, to arrange
for at least two (2) market makers to register as such with
respect to such Registrable Securities with the National
Association of Securities Dealers;
()provide a transfer agent, registrar and CUSIP number for
all of such Registrable Securities not later than the
effective date of such registration statement;
()make available for inspection by any seller of Registrable
Securities, any underwriter participating in any disposition
pursuant to such registration statement, and any attorney,
accountant or other agent retained by any such seller or
underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause
the Company's officers, directors, employees, attorneys and
independent accountants to supply all information, in each
case reasonably requested by any such sellers, underwriters,
attorneys, accountants or agents in connection with such
registration statement, subject to the right of the Company
to limit access to any such information to the extent that
(i) the Company is restricted from providing such information
pursuant to any bona fide confidentiality agreement to which
the Company or any of its subsidiaries is a party and (ii)
the Company shall have delivered to each seller of the
Registrable Securities a certificate duly executed by the
chief executive or chief financial officer of the Company
stating that such information does not contain any material
information that has not been publicly disclosed and which
would be required to be disclosed in, or which would
materially affect any information required to be disclosed
in, such registration statement;
()use its best efforts to comply with all applicable laws
related to such registration statement and offering and sale
of securities and all applicable rules and regulations of
governmental authorities in connection therewith (including,
without limitation, the Securities Act and the Exchange Act
and the rules and regulations promulgated by the Commission)
and make generally available to its security holders as soon
as practicable (but in any event not later than 15 months
after the effectiveness of such registration statement) an
earnings statement of the Company and its subsidiaries
complying with Section 11(a) of the Securities Act;
()furnish to each seller of Registrable Securities a signed
counterpart of (i) an opinion of counsel for the Company
(which counsel shall be reasonably acceptable to the holders
of a majority of the Registrable Securities being so
registered) and (ii) a "comfort" letter signed by the
independent public accountants who have certified the
Company's financial statements included or incorporated by
reference in such registration statement, covering such
matters with respect to such registration statement and, in
the case of the accountants' comfort letter, with respect to
events subsequent to the date of such financial statements,
as are customarily covered in opinions of issuer's counsel
and in accountants' comfort letters delivered to the
underwriters in underwritten public offerings of securities
for the account of, or on behalf of, an issuer of common
stock, such opinion and comfort letters to be dated the date
such opinions and comfort letters are customarily dated in
such transactions, and covering, in the case of such legal
opinion, such other legal matters and, in the case of such
comfort letter, such other financial matters, as any seller
of such Registrable Securities may reasonably request; and
()take all such other actions as the holders of a majority of
the Registrable Securities being sold or the underwriters, if
any, reasonably request in order to expedite or facilitate
the disposition of such Registrable Securities.
Without limiting any of the foregoing, in the event that the
offering of Registrable Securities is to be made by or
through an underwriter, the Company shall enter into an
underwriting agreement with a managing underwriter or
underwriters containing representations, warranties,
indemnities and agreements customarily included (but not
inconsistent with the agreements contained herein) by an
issuer of common stock in underwriting agreements with
respect to offerings of common stock for the account of, or
on behalf of, selling shareholders. In connection with the
sale of Registrable Securities hereunder, any seller of such
Registrable Securities may, at its option, require that any
and all representations and warranties by, and indemnities
and agreements of, the Company to or for the benefit of such
underwriter or underwriters (or which would be made to or for
the benefit of such an underwriter or underwriters if such
sale of Registrable Securities were pursuant to a customary
underwritten offering) be made to and for the benefit of such
seller and that any or all of the conditions precedent to the
obligations of such underwriter or underwriters (or which
would be so for the benefit of such underwriter or
underwriters under a customary underwriting agreement) be
conditions precedent to the obligations of such seller in
connection with the disposition of its securities pursuant to
the terms hereof (it being agreed that in connection with any
Demand Registration, without limiting any rights or remedies
of the holders of Registrable Securities, subject to Section
4, in the event any such condition precedent shall not be
satisfied and, if not so satisfied, shall not be waived by
the holders of a majority of the Registrable Securities to be
included in such Demand Registration, such Demand
Registration shall not be counted as a permitted Demand
hereunder). Each seller of Registrable Securities pursuant
to the terms of this Agreement shall be required to make such
representations and warranties to, and agreements with, the
Company and/or underwriter or underwriters as are customary
in similar transactions or are contemplated by the terms of
this Agreement. In connection with any offering of
Registrable Securities registered pursuant to this Agreement,
the Company shall (i) furnish to the underwriter, if any (or,
if no underwriter, the sellers of such Registrable
Securities), unlegended certificates representing ownership
of the Registrable Securities being sold, in such
denominations as requested for sale pursuant to such
registration and (ii) instruct any transfer agent and
registrar of the Registrable Securities to release any stop
transfer order with respect thereto.
Each seller of Registrable Securities hereunder agrees that
upon receipt of any notice from the Company of the happening
of any event of the kind described in paragraph (h) of this
Section 6, such seller shall forthwith discontinue such
seller's disposition of Registrable Securities pursuant to
the applicable registration statement and prospectus relating
thereto until such seller's receipt of the copies of the
supplemented or amended prospectus contemplated by paragraph
(h) of this Section 6 and, if so directed by the Company,
deliver to the Company (at the Company's sole cost and
expense) all copies, other than permanent file copies, then
in such seller's possession of the prospectus current at the
time of receipt of such notice relating to such Registrable
Securities. In the event the Company shall give such notice,
the 120-day period during which such registration statement
must remain effective pursuant to this Agreement shall be
extended by the number of days during the period from the
date of giving of a notice regarding the happening of an
event of the kind described in paragraph (h) of this Section
6 to the date when all such sellers shall receive such a
supplemented or amended prospectus and such prospectus shall
have been filed with the Commission.
SECTION .Registration Expenses. All expenses incident to the
Company's performance of, or compliance with, its obligations
under this Agreement (without implication that the contrary
would otherwise be true, whether or not a registration
statement under the Securities Act is filed with the
Commission or becomes effective under the Securities Act)
including, without limitation, all registration and filing
fees, all fees and expenses of compliance with securities and
"blue sky" laws (including, without limitation, the fees and
expenses of counsel for underwriters or placement or sales
agents in connection therewith to the extent provided for in
the underwriting agreement), all printing and copying
expenses, all messenger and delivery expenses, all fees and
expenses of underwriters and sales and placement agents in
connection therewith (excluding discounts and commissions),
all fees and expenses of the Company's independent certified
public accountants and counsel (including, without
limitation, with respect to "comfort" letters and opinions)
and other Persons retained by the Company in connection
therewith, and the fees and expenses of no more than one
counsel for the holders (as a group) of Registrable
Securities to be registered hereunder (collectively, the
"Registration Expenses") shall be borne by the Company unless
otherwise provided in this Agreement except that the Company
will, in any event (and without implication that the contrary
would otherwise be true), pay its internal expenses
(including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting
duties, and the expense of any annual audit) (collectively,
"Internal Expenses") and the expenses and fees for listing
the securities to be registered on each securities exchange
and included in each established over-the-counter market on
which securities of the same class issued by the Company are
then listed or traded or for listing on the NASDAQ pursuant
to paragraph (i) of Section 6 of this Agreement.
SECTION .Indemnification.
()By the Company. The Company agrees to indemnify, to the
fullest extent permitted by law, each holder of Registrable
Securities, its officers, directors, employees and agents and
each Person who controls (within the meaning of the
Securities Act) such holder or such an other indemnified
Person against all losses, claims, damages, liabilities and
expenses caused by any untrue or alleged untrue statement of
material fact contained in any registration statement,
prospectus or preliminary prospectus or any amendment thereof
or supplement thereto or any omission or alleged omission of
a material fact required to be stated therein or of a fact
necessary to make the statements therein not misleading,
except insofar as the same are caused by and contained in any
information furnished in writing to the Company by such
holder expressly for use therein. In connection with an
underwritten offering and without limiting any of the
Company's other obligations under this Agreement, the Company
shall indemnify such underwriters, their officers, directors,
employees and agents and each Person who controls (within the
meaning of the Securities Act) such underwriters or such an
other indemnified Person to the same extent as provided above
with respect to the indemnification of the holders of
Registrable Securities.
()By Holders. In connection with any registration statement
in which a holder of Registrable Securities is participating,
each such holder will furnish to the Company in writing
information regarding such holder's ownership of Registrable
Securities and its intended method of distribution thereof
and, to the extent permitted by law, shall indemnify the
Company, its directors, officers, employees and agents and
each Person who controls (within the meaning of the
Securities Act) the Company or such an other indemnified
Person against any losses, claims, damages, liabilities and
expenses (including with respect to any claim for
indemnification hereunder asserted by any other indemnified
Person) resulting from any untrue or alleged untrue statement
of material fact contained in the registration statement,
prospectus or preliminary prospectus or any amendment thereof
or supplement thereto or any omission or alleged omission of
a material fact required to be stated therein or necessary to
make the statements therein not misleading, but only to the
extent that such untrue statement or omission is caused by
and contained in such information so furnished in writing by
such holder; provided that the obligation to indemnify will
be several, not joint and several, among holders of
Registrable Securities and the liability of each such holder
of Registrable Securities will be in proportion to and
limited to the net amount received by such holder from the
sale of Registrable Securities pursuant to such registration
statement.
()Notice. Any Person entitled to indemnification hereunder
shall give prompt written notice to the indemnifying party of
any claim with respect to which it seeks indemnification;
provided, however, the failure to give such notice shall not
release the indemnifying party from its obligation under this
Section 8, except to the extent that the indemnifying party
has been materially prejudiced by such failure to provide
such notice.
()Defense of Actions. In any case in which any such action
is brought against any indemnified party, and it notifies an
indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein,
and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party will not (so long
as it shall continue to have the right to defend, contest,
litigate and settle the matter in question in accordance with
this paragraph) be liable to such indemnified party hereunder
for any legal or other expense subsequently incurred by such
indemnified party in connection with the defense thereof
other than reasonable costs of investigation, supervision and
monitoring (unless such indemnified party reasonably objects
to such assumption on the grounds that there may be defenses
available to it which are different from or in addition to
the defenses available to such indemnifying party, in which
event the indemnified party shall be reimbursed by the
indemnifying party for the expenses incurred in connection
with retaining separate legal counsel; provided that the
indemnifying party shall not be obligated to reimburse the
indemnified parties for the fees and expenses of more than
one counsel for all indemnified parties who do not have
different or additional defenses among themselves). An
indemnifying party shall not be liable for any settlement of
an action or claim effected without its consent. The
indemnifying party shall lose its right to defend, contest,
litigate and settle a matter if it shall fail to diligently
contest such matter (except to the extent settled in
accordance with the next following sentence). No matter
shall be settled by an indemnifying party without the consent
of the indemnified party (which consent shall not be
unreasonably withheld).
()Survival. The indemnification provided for under this
Agreement shall remain in full force and effect regardless of
any investigation made by or on behalf of the indemnified
Person and will survive the transfer of the Registrable
Securities.
()Contribution. If recovery is not available under the
foregoing indemnification provisions for any reason or
reasons other than as specified therein, any Person who would
otherwise be entitled to indemnification by the terms thereof
shall nevertheless be entitled to contribution with respect
to any losses, claims, damages, liabilities or expenses with
respect to which such Person would be entitled to such
indemnification but for such reason or reasons. In
determining the amount of contribution to which the
respective Persons are entitled, there shall be considered
the Persons' relative knowledge and access to information
concerning the matter with respect to which the claim was
asserted, the opportunity to correct and prevent any
statement or omission, and other equitable considerations
appropriate under the circumstances. It is hereby agreed
that it would not necessarily be equitable if the amount of
such contribution were determined by pro rata or per capita
allocation.
SECTION .Participation in Underwritten Registrations. No
Person may participate in any underwritten registration
hereunder unless such Person (a) agrees to sell such Person's
securities on the basis provided in any underwriting
arrangements and (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of
such underwriting arrangements.
SECTION .Miscellaneous.
()Existing Registration Rights; No Inconsistent Agreements.
The Company represents and warrants that there are no
existing rights to require or request the Company to register
any equity securities of the Company, or any securities
convertible or exchangeable into or exercisable for such
securities. The Company shall not grant to any Person the
right to require or request the Company to register any
equity securities of the Company, or any securities
convertible or exchangeable into or exercisable for such
securities, without the prior written consent of the holders
of two-thirds of the Registrable Securities.
()Rule 144. The Company shall timely file the reports, if
any, required to be filed by it under the Securities Act or
the Exchange Act (including, if required, the reports under
Sections 13 and 15(d) of the Exchange Act referred to in
subparagraph (c)(1) of Rule 144). Upon the request of any
holder of Registrable Securities, the Company shall: (i)
deliver to such holder a written statement as to its
compliance with the reporting requirements of Rule 144, as
such rule may be amended from time to time, and (ii) take
such further action, including, without limitation, supply
and make publicly available any other information in the
possession of or reasonably obtainable by the Company, with
the purpose of allowing such holder to avail itself of Rule
144 or any other rule or regulation of the Commission
allowing it to sell securities without registration under the
Securities Act.
()Remedies. If any party to this Agreement obtains a
judgment against any other party hereto by reason of any
breach of this Agreement or the failure of such other party
to comply with the provisions hereof, a reasonable attorneys'
fee as fixed by the court shall be included in such judgment.
No remedy conferred upon any party to this Agreement is
intended to be exclusive of any other remedy herein or by law
provided or permitted, but each such remedy shall be
cumulative and shall be in addition to every other remedy
given hereunder or now or hereafter existing at law or in
equity or by statute.
()Amendments and Waivers. Except as otherwise provided
herein, the provisions of this Agreement may be amended or
waived and the Company may take any action herein prohibited,
or omit to perform any act herein required to be performed by
it, only if the Company has obtained the written consent of
holders of two-thirds of the Registrable Securities; provided
that no such amendment or waiver may be made and the Company
may not take any such action or fail to perform any such act
if such amendment, action or failure to perform adversely
affects any holder or group of holders of Registrable
Securities in a manner that does not adversely affect the
holders of Registrable Securities in general, without the
written consent of such holder or members of such group of
holders holding a majority of the Registrable Securities held
by such group. Notwithstanding the foregoing, holders of
Registrable Securities outstanding from time to time shall
not be entitled to adversely affect the rights of former
holders of Registrable Securities under this Agreement by any
such amendment or waiver without the consent of a majority in
interest of such former holders so affected. The waiver by
any party hereto of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of
any other provision of this Agreement or of any further
breach of the provision so waived or of any other provision
of this Agreement. No extension of time for the performance
of any obligation or act hereunder shall be deemed an
extension of time for the performance of any other obligation
or act. The waiver by any party of any of the conditions
precedent to its obligations under this Agreement shall not
preclude it from seeking redress for breach of this
Agreement.
()Successors and Assigns. All covenants and agreements in
this Agreement by or on behalf of any of the parties hereto
will bind and inure to the benefit of the respective
successors and assigns of the parties hereto whether so
expressed or not. In addition, whether or not any express
assignment has been made, the provisions of this Agreement
which are for the benefit of purchasers or holders of
Registrable Securities are also for the benefit of, and
enforceable by, any subsequent holder of Registrable
Securities; provided that securities shall cease to be
Registrable Securities under the circumstances provided in
Section 1(q).
()Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be
effective and valid under applicable law, but if any
provision of this Agreement is held to be prohibited by or
invalid under applicable law, such provision will be
ineffective only to the extent of such prohibition or
invalidity, and the remaining provisions of this Agreement
shall continue to be binding and in full force and effect.
()Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be effective only upon
delivery and thereafter shall be deemed to be an original,
and all of which shall be taken to be one and the same
instrument with the same effect as if each of the parties
hereto had signed the same signature page. Any signature
page of this Agreement may be detached from any counterpart
of this Agreement without impairing the legal effect of any
signature thereon and may be attached to another counterpart
of this Agreement identical in form hereto and having
attached to it one or more additional signature pages.
()Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience only and shall not be
deemed to limit, characterize or interpret any provision of
this Agreement.
()Governing Law. All questions concerning the construction,
validity and interpretation of this Agreement and the
exhibits and schedules hereto will be governed by the
internal law, and not the law of conflicts, of Illinois.
()Notices. All notices and other communications which are
required or permitted to be given or delivered under or by
reason of the provisions of this Agreement shall be in
writing and shall be delivered personally, mailed by
certified or registered mail, return receipt requested, sent
by reputable overnight courier or sent by confirmed
telecopier, addressed as follows:
()if to the Company, at 0000 Xxxxxxxxxx Xxxx, Xxxxx 000,
Xxxxxxxxxxxx, Xxxxxxx 00000-0000, Attention: President;
()if to any Shareholder, at the address of such Shareholder
as disclosed by the records of the Company; or to such other
address and/or such other addressee as any of the above shall
have specified by notice hereunder. Each notice or other
communication which shall be delivered personally, mailed or
telecopied in the manner described above shall be deemed
sufficiently given, served, sent, received or delivered for
all purposes at such time as it is delivered to the addressee
(with the return receipt, the delivery receipt or the
affidavit of messenger being deemed conclusive, but not
exclusive, evidence of such delivery) or at such time as
delivery is refused by the addressee upon presentation.
()Entire Agreement. This Agreement constitutes the sole and
entire
agreement of the parties with respect to the subject matter
hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date
first written above.
MERIDIAN FINANCIAL
CORPORATION
By:
Its:
SHAREHOLDERS:
INROADS CAPITAL PARTNERS,
L.P.
By:INROADS GENERAL
PARTNERS, L.P., its general partner
By:
Title:
MESIROW CAPITAL PARTNERS VII,
an Illinois Limited Partnership
By:MESIROW FINANCIAL
SERVICES, INC., its general partner
By:
Title:
EDGEWATER PRIVATE EQUITY FUND
II, L.P.
By:XXXXXX MANAGEMENT,
INC.,
its general partner
By:
Title:
