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REGISTRATION RIGHTS AGREEMENT
Dated as of September 3, 1997
by and among
NB CAPITAL CORPORATION
and
NATIONAL BANK OF CANADA
and
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
as Initial Purchaser
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made
and entered into as of September 3, 1997 by and among NB CAPITAL CORPORATION, a
Maryland corporation (the "Company"), National Bank of Canada, a Canada
chartered bank (the "Bank") and the 100% owner of all the issued and outstanding
common stock of the Company, and XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED ("Xxxxxxx Xxxxx" or the "Initial Purchaser").
This Agreement is made pursuant to the Purchase Agreement
dated as of August 22, 1997 by and among the Company, the Bank and the Initial
Purchaser (the "Purchase Agreement"), which provides for, among other things,
the sale by the Company to the Initial Purchaser of 300,000 shares of the
Company's 8.35% Noncumulative Exchangeable Preferred Stock, Series A (each, a
"Security" and together, "Securities"), each of which will automatically be
exchanged, upon the occurrence of certain events, for one of the Bank's 8.45%
Noncumulative First Preferred Share, Series Z (a "Bank Preferred Share"). In
order to induce the Initial Purchaser to enter into the Purchase Agreement, the
Company and the Bank have agreed to provide to the Initial Purchaser and their
direct and indirect transferees the registration rights set forth in this
Agreement. The execution and delivery of this Agreement is a condition to the
closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. Definitions. As used in this Agreement, the following
capitalized defined terms shall have the following meanings:
"Advice" shall have the meaning set forth in the last
paragraph of Section 3 hereof.
"Applicable Period" shall have the meaning set forth in
Section 3(r) hereof.
"Business Day" shall mean a day that is not a Saturday, a
Sunday, or a day on which banking institutions in New York, New
York are required to be closed.
"Closing Time" shall mean the Closing Time as defined in the
Purchase Agreement.
"Company" shall have the meaning set forth in the preamble
to this Agreement and also includes the Company's successors and
permitted assigns.
"Depositary" shall mean The Depository Trust Company, or any
other depositary appointed by the Company; provided, however,
that such depositary must have an address in the Borough of
Manhattan, in The City of New York.
"Effectiveness Period" shall have the meaning set forth in
Section 2(b) hereof.
"Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
"Exchange Offer" shall mean the exchange offer by the
Company and the Bank of Exchange Securities for Securities
pursuant to Section 2(a) hereof.
"Exchange Offer Registration" shall mean a registration
under the Securities Act effected pursuant to Section 2(a)
hereof.
"Exchange Offer Registration Statement" shall mean an
exchange offer registration statement on Form S-1 or S-4 (or, if
applicable, on another appropriate form), and all amendments and
supplements to such registration statement, in each case
including the Prospectus contained therein, all exhibits thereto
and all material incorporated by reference therein.
"Exchange Period" shall have the meaning set forth in
Section 2(a) hereof.
"Exchange Securities" shall mean the 8.35% Noncumulative
Exchangeable Preferred Stock, Series A, issued by the Company
identical to the Securities (except that the transfer
restrictions thereon shall be eliminated) to be offered to
Holders of Securities in exchange for Exchange Securities
pursuant to the Exchange Offer.
"Holder" shall mean the Initial Purchaser, for so long as it
owns any Registrable Securities, and each of their successors,
assigns and direct and indirect transferees who become registered
owners of Registrable Securities.
"Initial Purchaser" shall have the meaning set forth in the
preamble to this Agreement.
"Inspectors" shall have the meaning set forth in Section
3(n) hereof.
"Issue Date" shall mean the date of original issuance of the
Securities.
"Liquidated Damages" shall have the meaning and set forth in
Section 2(e) hereof.
"Majority Holders" shall mean the Holders of a majority of
the aggregate number of shares of outstanding Registrable
Securities.
"Offering Memorandum" shall mean the Offering Memorandum
relating to the Securities dated as of August 22, 1997.
"Participating Broker-Dealer" shall have the meaning set
forth in Section 3(r) hereof.
"Person" shall mean an individual, partnership, corporation,
trust or unincorporated organization, or a government or agency
or political subdivision thereof.
"Prospectus" shall mean the prospectus included in a
Registration Statement, including any preliminary prospectus, and
any such prospectus as amended or supplemented by any prospectus
supplement, including a prospectus supplement with respect to the
terms of the offering of any portion of the Registrable
Securities covered by a Shelf Registration Statement, and by all
other amendments and supplements to a prospectus, including
post-effective amendments, and in each case including all
material incorporated by reference therein.
"Purchase Agreement" shall have the meaning set forth in the
preamble to this Agreement.
"Records" shall have the meaning set forth in Section 3(m)
hereof.
"Registrable Securities" shall mean each Security until (i)
the date on which such Security has been exchanged by a Person
(ii) the date on which such Security has been effectively
registered under the Securities Act and disposed of in accordance
with the Shelf Registration Statement, (iii) the date on which
such Security is eligible for distribution to the public pursuant
to Rule 144(k) under the Securities Act (or any similar provision
then in force, but not Rule 144A under the Securities Act), (iv)
the date such Security shall have been otherwise transferred by
the holder thereof and a new Security not bearing
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a legend restricting further transfer shall have been
delivered by the Company and subsequent disposition of such
Security shall not require registration or qualification under
the Securities Act or any similar state law then in force or (v)
such Security ceases to be outstanding.
"Registration Expenses" shall mean any and all expenses
incident to performance of or compliance by the Company and the
Bank with this Agreement, including without limitation: (i) all
SEC, stock exchange or National Association of Securities
Dealers, Inc. (the "NASD") registration and filing fees, (ii) all
fees and expenses incurred in connection with compliance with
state securities or blue sky laws (including reasonable fees and
disbursements of one counsel for any underwriters or the Initial
Purchaser in connection with blue sky qualification of any of the
Exchange Securities or Registrable Securities) and compliance
with the rules of the NASD, (iii) all expenses of any Persons
(other than the Holders or Persons acting on the request of the
Holders) in preparing or assisting in preparing, word processing,
printing and distributing any Registration Statement, any
Prospectus and any amendments or supplements thereto, and in
preparing or assisting in preparing, printing and distributing
any underwriting agreements, securities sales agreements and
other documents relating to the performance of and compliance
with this Agreement, (iv) all rating agency fees, (v) the fees
and disbursements of counsel for the Company and of the
independent certified public accountants of the Company,
including the expenses of any "cold comfort" letters required by
or incident to such performance and compliance, (vi) the fees and
expenses of the Transfer Agent, and any exchange agent or
custodian, (vii) all fees and expenses incurred in connection
with the listing, if any, of any of the Registrable Securities on
any securities exchange or exchanges, (viii) the fees and
expenses of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP ("Skadden,
Arps"), counsel for the Initial Purchaser and the Holders in
connection with a Shelf Registration Statement hereunder, and
(ix) any fees and disbursements of any underwriter customarily
required to be paid by Company or sellers of securities and the
reasonable fees and expenses of any special experts retained by
the Company in connection with any Registration Statement, but
excluding fees of counsel to the Initial Purchaser and
underwriting discounts and commissions and transfer taxes, if
any, relating to the sale or disposition of Registrable
Securities by a Holder.
"Registration Statement" shall mean any registration
statement of the Company and the Bank which covers any of the
Exchange Securities or Registrable Securities pursuant to the
provisions of this Agreement, and all amendments and supplements
to any such Registration Statement, including post-effective
amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by
reference therein.
"SEC" shall mean the Securities and Exchange Commission.
"Securities" shall have the meaning set forth in the
preamble to this Agreement and shall be deemed to included the
interest of the Holder thereof in the Bank Preferred Shares.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Senior Preferred Shares" shall mean the Adjustable Rate
Cumulative Senior Preferred Shares of the Company.
"Shelf Registration" shall mean a registration effected
pursuant to Section 2(b) hereof.
"Shelf Registration Statement" shall mean a "shelf"
registration statement of the Company and the Bank pursuant to
the provisions of Section 2(b) hereof which covers all of the
Registrable Securities or all of the Private Exchange Securities,
as the case may be, on an appropriate form under Rule 415 under
the Securities Act, or any similar rule that may be adopted by
the SEC, 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 material incorporated by reference therein.
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"Transfer Agent" shall mean the Bank of Nova Scotia Trust
Company of New York.
2. Registration Under the Securities Act.
(a) Exchange Offer. To the extent not prohibited by any
applicable law or applicable SEC policy, the Company and the Bank shall, for the
benefit of the Holders, at the Company's cost (i) use their best efforts to file
with the SEC within 150 days after the Issue Date an Exchange Offer Registration
Statement on an appropriate form or forms under the Securities Act covering the
offer by the Company to the Holders to exchange all of the Registrable
Securities for a like number of Exchange Securities, (ii) use their best efforts
to cause such Exchange Offer Registration Statement to be declared effective
under the Securities Act by the SEC within 180 days after the Issue Date, (iii)
use their best efforts to have such Registration Statement remain effective for
no fewer than 30 days (or longer if required by applicable law) after the date
notice of the Exchange Offer has been mailed to the Holders and (iv) commence
the Exchange Offer and use its best efforts to issue Exchange Securities in
exchange for all Securities properly tendered prior thereto in the Exchange
Offer not later than 45 days after the date on which the Exchange Offer
Registration Statement was declared effective by the SEC. Upon the effectiveness
of the Exchange Offer Registration Statement, the Company and the Bank shall
promptly commence the Exchange Offer, it being the objective of such Exchange
Offer to enable each Holder eligible and electing to exchange Registrable
Securities for Exchange Securities (assuming that such Holder is not an
affiliate of the Company within the meaning of Rule 405 under the Securities Act
and is not a broker-dealer tendering Registrable Securities acquired directly
from the Company for its own account as a result of market making activities or
other trading activities, acquires the Exchange Securities in the ordinary
course of such Holder's business and has no arrangements or understandings with
any Person to participate in the Exchange Offer for the purpose of distributing
(within the meaning of the Securities Act) the Exchange Securities) to transfer
such Exchange Securities from and after their receipt without any limitations or
restrictions under the Securities Act and without material restrictions under
state securities or blue sky laws.
In connection with the Exchange Offer, the Company and the
Bank shall:
(i) mail to each Holder a copy of the Prospectus forming
part of the Exchange Offer Registration Statement, together with
an appropriate letter of transmittal and related documents;
(ii) keep the Exchange Offer open for acceptance for a
period of not less than 30 days after the date notice thereof is
mailed to the Holders (or longer if required by applicable law)
(such period referred to herein as the "Exchange Period");
(iii) utilize the services of the Depositary for the
Exchange Offer, if permitted by the Depositary;
(iv) permit Holders to withdraw tendered Securities at any
time prior to the close of business, New York time, on the last
Business Day of the Exchange Period, by sending to the
institution specified in the notice, a telegram, telex, facsimile
transmission or letter setting forth the name of such Holder, the
number of Securities delivered for exchange, and a statement that
such Holder is withdrawing such Holder's election to have such
Securities exchanged;
(v) notify each Holder that any Security not tendered will
remain outstanding and continue to receive dividends, if, when
and as declared by the Company's Board of Directors, but will not
retain any rights under this Agreement (except in the case of the
Initial Purchaser and Participating Broker-Dealers as provided
herein); and
(vi) otherwise comply in all respects with all applicable
laws relating to the Exchange Offer.
As soon as practicable after the close of the Exchange Offer
the Company and the Bank shall:
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(i) accept for exchange all Securities or portions thereof
tendered and not validly withdrawn pursuant to the Exchange
Offer; and
(ii) deliver, or cause to be delivered, to the Exchange
Agent for cancellation all Securities so accepted for exchange,
and issue, and cause the Transfer Agent under the Transfer Agent
Agreement to promptly authenticate and deliver to each Holder, a
new Exchange Security equal in number to the number of the
Securities surrendered by such Holder and accepted for exchange.
Each Holder of Registrable Securities who wishes to exchange
such Registrable Securities for Exchange Securities in the Exchange Offer will
be required to make certain customary representations in connection therewith,
including representations that such Holder is not an affiliate of the Company
within the meaning of Rule 405 under the Securities Act, that any Exchange
Securities to be received by it will be acquired in the ordinary course of
business and that at the time of the commencement of the Exchange Offer it has
no arrangement with any Person to participate in the distribution (within the
meaning of the Securities Act) of the Exchange Securities.
Upon consummation of the Exchange Offer in accordance with
this Section 2(a), the provisions of this Agreement shall continue to apply,
mutatis mutandis, solely with respect to Registrable Securities that are held by
the Initial Purchaser and Exchange Securities held by Participating
Broker-Dealers, and the Company shall have no further obligation to register
Registrable Securities and the Liquidated Damages shall no longer apply pursuant
to Section 2(b) hereof.
(b) Shelf Registration. In the event that (i) the Company or
the Bank is not permitted to file the Exchange Offer Registration Statement or
to consummate the Exchange Offer because the Exchange Offer is not permitted by
a change in law or applicable interpretation of the SEC, (ii) the Exchange Offer
Registration Statement is not declared effective within 180 days after the Issue
Date, (iii) any holder of Securities notifies the Company within 30 days after
the commencement of the Exchange Offer that (a) due to a change in law or policy
it is not entitled to participate in the Exchange Offer, (b) due to a change in
law or policy it may not resell the Exchange Securities acquired by it in the
Exchange Offer to the public without delivering a prospectus and the prospectus
contained in the Exchange Offer Registration Statement is not appropriate or
available for such resales by such holder or (c) it is a broker-dealer and owns
Securities acquired directly from the Company or an affiliate of the Company or
(d) the holders of a majority of the Securities may not resell the Exchange
Securities acquired by them in the Exchange Offer to the public without
restriction under the Securities Act and without restriction under applicable
blue sky or state securities laws or (e) the Company requests the Initial
Purchaser pursuant to Section 7(b) hereof to effect the public distribution of
Securities, then the Company and the Bank shall, at their cost, file as promptly
as practicable after such determination or date, in addition or in lieu of
effecting the registration of the Exchange Securities pursuant to the Exchange
Offer Registration Statement, and, in any event, prior to the later of (A) 180
days after the Issue Date or (B) 30 days after such filing obligation arises
(provided, however, that if the Company and the Bank have not consummated the
Exchange offer within 150 days after the Issue Date, then the Company and the
Bank shall file the Shelf Registration Statement with the SEC on or prior to the
180th day after the Issue Date), a Shelf Registration Statement providing for
the sale by the Holders of Registrable Securities, and shall use their best
efforts to cause such Shelf Registration Statement declared effective by the SEC
as soon as practicable and, in any event, on or prior to 60 days after the
obligation to file the Shelf Registration Statement arises. No Holder of
Registrable Securities may include any of its Registrable Securities in any
Shelf Registration filed pursuant to clause (e) above or any other Shelf
Registration pursuant to this Agreement unless and until such Holder furnishes
to the Company in writing, within 15 days after receipt of a request therefor,
such information as the Company may, after conferring with counsel with regard
to information relating to Holders that would be required by the SEC to be
included in such Shelf Registration Statement or Prospectus included therein,
reasonably request for inclusion in any Shelf Registration Statement or
Prospectus included therein. Each Holder as to which any Shelf Registration is
being effected agrees to furnish to the Company all information with respect to
such Holder necessary to make any information previously furnished to the
Company by such Holder not materially misleading.
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The Company and the Bank agree to use their best efforts to
keep the Shelf Registration Statement continuously effective, supplemented and
amended for a period of up to two years after the Issue Date (six months in the
case of a Shelf Registration Statement filed at the request of the Initial
Purchaser) (or such shorter period provided for in any amendment to Rule 144(k)
under the Securities Act (or any successor provision other than Rule 144A) upon
the expiration of which securities are eligible for distribution to the public)
from the Issue Date or such shorter period that will terminate when all the
Registrable Securities covered by the Shelf Registration Statement have been
sold pursuant thereto (subject to extension pursuant to the last paragraph of
Section 3 hereof) or otherwise cease to be Registrable Securities (the
"Effectiveness Period"). The Company and the Bank shall not permit any
securities other than Registrable Securities to be included in the Shelf
Registration. The Company and the Bank further agree, if necessary, to
supplement or amend the Shelf Registration Statement, if required by the rules,
regulations or instructions applicable to the registration form used by the
Company and the Bank for such Shelf Registration Statement or by the Securities
Act or by any other rules and regulations thereunder for shelf registrations,
and the Company and the Bank agree to furnish to the Holders of Registrable
Securities copies of any such supplement or amendment promptly after its being
used or filed with the SEC.
(c) Expenses. The Company shall pay all Registration Expenses
in connection with the registration pursuant to Section 2(a) or 2(b) hereof and
Skadden, Arps, as counsel for the Holders to act as counsel for the Holders of
the Registrable Securities in connection with a Shelf Registration Statement.
Except as provided in the preceding sentence, each Holder shall pay all expenses
of its counsel, underwriting discounts and commissions and transfer taxes, if
any, relating to the sale or disposition of such Holder's Registrable Securities
pursuant to the Shelf Registration Statement.
(d) Effective Registration Statement. An Exchange Offer
Registration Statement pursuant to Section 2(a) hereof or a Shelf Registration
Statement pursuant to Section 2(b) hereof will not be deemed to have become
effective unless it has been declared effective by the SEC; provided, however,
that if, after it has been declared effective, the offering of Registrable
Securities pursuant to a Shelf Registration Statement is interfered with by any
stop order, injunction or other order or requirement of the SEC or any other
governmental agency or court, such Registration Statement will be deemed not to
have been effective during the period of such interference, until the offering
of Registrable Securities may legally resume.
(e) Liquidated Damages. If (i) (A) the Company and the Bank
fail to file an Exchange Offer Registration Statement or a Shelf Registration
Statement on or before the 150th day after the Issue Date or (B) notwithstanding
that the Company has consummated or will consummate an Exchange Offer, the
Company is required to file a Shelf Registration Statement and such Shelf
Registration Statement is not filed on or prior to the date required by Section
2(b) hereof, then commencing on the day after either such required filing date,
an additional amount being liquidated damages shall be payable to the holders of
the Securities at a rate of 0.25% of the liquidation preference per annum; or
(ii) if (A) neither the Exchange Offer Registration
Statement is declared effective by the SEC on or prior to the
180th day after the Issue Date nor a Shelf Registration Statement
is declared effective by the SEC on or prior to the later of the
30th day after the applicable required filing date or the 180th
day after the Issue Date or (B) notwithstanding that the Company
has consummated or will consummate an Exchange Offer, the Company
is required to file a Shelf Registration Statement and such Shelf
Registration Statement is not declared effective by the SEC on or
prior to the later of the 30th day after the date such Shelf
Registration Statement was required to be filed or the 180th day
after the Issue Date, then, commencing on the 181st day after the
Issue Date with respect to the Exchange Offer Registration
Statement or the 31st day after the applicable required filing
date (or the 181st day of the Issue Date, if later), an
additional amount being liquidated damages shall be payable to
the holders of the Securities at a rate of 0.25% of the
liquidation preference per annum; or
(iii) if (A) the Company has not exchanged Exchange
Securities for all Securities validly tendered in accordance with
the terms of the Exchange Offer on or prior to the 45th day after
the date on
6
which the Exchange Offer Registration Statement was declared
effective or (B) if applicable, the Shelf Registration Statement
has been declared effective and such Shelf Registration Statement
ceases to be available for use by holders of the Securities at
any time prior to the second anniversary of the Issue Date (other
than after such time as all Securities have been disposed of
thereunder or otherwise cease to be Registrable Securities), and
such event continues for a period exceeding 30 consecutive days
or 90 days in any 360-day period, whether or not consecutive,
then, an additional amount being liquidated damages, shall be
payable to the holders of the Securities at a rate of 0.25% of
the liquidation preference per annum commencing on (x) the 31st
day after such effective date, in the case of (A) above, or (y)
the 31st consecutive day or 91st day in any 360-day period
following the day such Shelf Registration Statement ceases to be
available in the case of (B) above.
provided, however, that the liquidated damages rate on the liquidation
preference of the Securities may not exceed in the aggregate 0.25% per annum
calculated on the basis of the number of days elapsed in a 360-day year of
twelve 30-day months; provided, further, however, that (1) upon the filing of
the Exchange Offer Registration Statement or a Shelf Registration Statement (in
the case of clause (i) above), (2) upon the effectiveness of the Exchange Offer
Registration Statement or a Shelf Registration Statement (in the case of clause
(ii) above), or (3) upon the exchange of Exchange Securities for all Securities
tendered (in the case of clause (iii) (A) above), or upon the availability of
the Shelf Registration Statement which had ceased to be available (in the case
of clause (iii) (B) above), liquidated damages on the liquidation preference of
the Securities as a result of such clause (or the relevant subclause thereof)
shall cease to accrue.
Any amounts of Liquidated Damages due pursuant to clause (i),
(ii) or (iii) above will be payable in cash quarterly on the 30th day of March,
June, September and December of each year to the Holders of record on the
immediately preceding 15th day of such month.
(f) Specific Enforcement. Without limiting the remedies
available to the Initial Purchaser and the Holders, the Company and the Bank
acknowledge that any failure by the Company or the Bank to comply with its
obligations under Section 2(a) and Section 2(b) hereof may result in material
irreparable injury to the Initial Purchaser or the Holders for which there is no
adequate remedy at law, that it would not be possible to measure damages for
such injuries precisely and that, in the event of any such failure, the Initial
Purchaser or any Holder may obtain such relief as may be required to
specifically enforce the Company's and the Bank's obligations under Section 2(a)
and Section 2(b) hereof.
3. Registration Procedures. In connection with the obligations
of the Company and the Bank with respect to the Registration Statements pursuant
to Sections 2(a) and 2(b) hereof, the Company and the Bank shall:
(a) prepare and file with the SEC a Registration Statement
or Registration Statements as prescribed by Sections 2(a) and
2(b) hereof within the relevant time period specified in Section
2 hereof on the appropriate form or forms under the Securities
Act, which form (i) shall be selected by the Company and the
Bank, (ii) shall, in the case of a Shelf Registration, be
available for the sale of the Registrable Securities by the
selling Holders thereof and (iii) shall comply as to form in all
material respects with the requirements of the applicable form
and include or incorporate by reference all financial statements
required by the SEC to be filed therewith; and use their best
efforts to cause such Registration Statement to become effective
and remain effective in accordance with Section 2 hereof;
(b) prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may
be necessary under applicable law to keep such Registration
Statement effective for the Effectiveness Period or the
Applicable Period, as the case may be; and cause each Prospectus
to be supplemented by any required prospectus supplement, and as
so supplemented to be filed pursuant to Rule 424 (or any similar
provision then in force) if required pursuant to Rule 424 (or any
similar provision then in force) under the Securities Act; and
comply with the provisions of the
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Securities Act, the Exchange Act and the rules and
regulations promulgated thereunder applicable to it with respect
to the disposition of all securities covered by each Registration
Statement during the Effectiveness Period or the Applicable
Period, as the case may be, in accordance with the intended
method or methods of distribution by the selling Holders thereof
described in this Agreement (including sales by any Participating
Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify each
Holder of Registrable Securities to be covered by such Shelf
Registration Statement, at least three Business Days prior to
filing, that a Shelf Registration Statement with respect to the
Registrable Securities is being filed and advising such Holder
that the distribution of Registrable Securities will be made in
accordance with the method selected by the Majority Holders; and
(ii) furnish to each Holder of Registrable Securities and to each
underwriter of an underwritten offering of Registrable
Securities, if any, without charge, as many copies of each
Prospectus, including each preliminary prospectus, and any
amendment or supplement thereto and such other documents as such
Holder or underwriter may reasonably request, in order to
facilitate the public sale or other disposition of the
Registrable Securities; and (iii) subject to the last paragraph
of Section 3 hereof, hereby consent to the use of the Prospectus
or any amendment or supplement thereto by each of the selling
Holders of Registrable Securities in connection with the offering
and sale of the Registrable Securities covered by the Prospectus
or any amendment or supplement thereto;
(d) in the case of a Shelf Registration, use their best
efforts to register or qualify the Registrable Securities under
all applicable state securities or "blue sky" laws of such
jurisdictions by the time the applicable Registration Statement
is declared effective by the SEC as any Holder of Registrable
Securities covered by a Registration Statement and each
underwriter of an underwritten offering of Registrable Securities
shall reasonably request in writing in advance of such date of
effectiveness, and do any and all other acts and things which may
be reasonably necessary or advisable to enable such Holder or
underwriter to consummate the disposition in each such
jurisdiction of such Registrable Securities owned by such Holder;
provided, however, that neither the Company nor the Bank shall be
required to (i) qualify as a foreign corporation or as a dealer
in securities in any jurisdiction where it would not otherwise be
required to qualify but for this Section 3(d) or (ii) take any
action which would subject it to general service of process or to
taxation in any such jurisdiction if it is not so subject;
(e) in the case of (1) a Shelf Registration or (2)
Participating Broker-Dealers who have notified the Company and
the Bank that they will be utilizing the Prospectus contained in
the Exchange Offer Registration Statement as provided in Section
3(r) hereof, notify each Holder of Registrable Securities, or
such Participating Broker-Dealers, as the case may be, their
counsel and confirm such notice in writing (i) when a
Registration Statement has become effective and when any
post-effective amendments and supplements thereto become
effective, (ii) of any request by the SEC or any state securities
authority for post-effective amendments and supplements to a
Registration Statement or Prospectus or for additional
information after the Registration Statement has become
effective, (iii) of the issuance by the SEC or any state
securities authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation of
any proceedings for that purpose, (iv) in the case of a Shelf
Registration, if, between the effective date of a Registration
Statement and the closing of any sale of Registrable Securities
covered thereby, the representations and warranties of the
Company and the Bank contained in any underwriting agreement,
securities sales agreement or other similar agreement, if any,
relating to such offering (but not including the Purchase
Agreement or this Agreement) cease to be true and correct in all
material respects, (v) if the Company or the Bank receives any
notification with respect to the suspension of effectiveness of a
Registration Statement or the qualification of the Registrable
Securities or the Exchange Securities to be sold by any
Participating Broker-Dealer for offer or sale in any jurisdiction
described in Section 3(d) hereof or the initiation of any
proceeding for such purpose, (vi) of the happening of any event
or the failure of any event to occur or the discovery of any
facts or otherwise during the Effectiveness Period or Applicable
Period, as the case may be, which makes any statement made in a
Registration Statement or the related Prospectus untrue in any
material respect or
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which causes such Registration Statement or Prospectus to
omit to state a material fact necessary to make the statements
therein (in the case of the Prospectus, in the light of the
circumstances under which they were made) not misleading and
(vii) the Company's reasonable determination that a
post-effective amendment to the Registration Statement would be
appropriate;
(f) make reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement
as soon as practicable;
(g) in the case of a Shelf Registration, furnish to each
Holder of Registrable Securities, without charge, at least one
conformed copy of each Registration Statement relating to such
Shelf Registration and any post-effective amendment thereto
(without documents incorporated therein by reference or exhibits
thereto, unless requested in writing);
(h) in the case of a Shelf Registration, cooperate with the
selling Holders of Registrable Securities to facilitate the
timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive
legends; and cause such Registrable Securities to be in such
permitted denominations and registered in such names as the
selling Holders or the underwriters may reasonably request at
least two Business Days prior to the closing of any sale of
Registrable Securities;
(i) in the case of a Shelf Registration, upon the occurrence
of any circumstance contemplated by Section 3(e)(ii), 3(e)(iii),
3(e)(v), 3(e)(vi) or 3(e)(vii) hereof, use their best efforts to
prepare a supplement or post-effective amendment to a
Registration Statement or the related Prospectus or any document
incorporated therein by reference or file any other required
document (subject to Section 3(a)) so that, as thereafter
delivered to the purchasers of the Registrable Securities or
Exchange Securities to whom a Prospectus is being delivered by a
Participating Broker-Dealer who has notified the Company that it
will be utilizing the Prospectus contained in the Exchange Offer
Registration Statement as provided in Section 3(r) hereof, such
Prospectus will not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; and to notify each Holder or
Participating Broker-Dealer, as the case may be, to suspend use
of the Prospectus as promptly as practicable after the occurrence
of such an event, and each Holder and Participating Broker-Dealer
hereby agrees to suspend use of the Prospectus until the Company
have amended or supplemented the Prospectus to correct such
misstatement or omission;
(j) in the case of a Shelf Registration, upon the filing of
any document which is to be incorporated by reference into a
Registration Statement or a Prospectus after the initial filing
of a Registration Statement, provide a reasonable number of
copies of such document to the Holders of Securities registrable
thereunder;
(k) obtain a CUSIP number for all Exchange Securities or
Registrable Securities, as the case may be, not later than the
effective date of a Registration Statement, and provide the
transfer agent with certificates for the Exchange Securities or
the Registrable Securities, as the case may be, in a form
eligible for deposit with the Depositary;
(l) in the case of a Shelf Registration, enter into such
agreements (including underwriting agreements) as are customary
in underwritten offerings and take all such other appropriate
actions as are reasonably requested in order to expedite or
facilitate the registration or the disposition of such
Registrable Securities, and in such connection, whether or not an
underwriting agreement is entered into and whether or not the
registration is an underwritten registration: (i) make such
representations and warranties to Holders of such Registrable
Securities and the underwriters (if any), with respect to the
business of the Company and the Bank and its subsidiaries as then
conducted or proposed to be
9
conducted and the Registration Statement, Prospectus and
documents, if any, incorporated or deemed to be incorporated by
reference therein, in each case, as are customarily made by
issuers to underwriters in underwritten offerings, and confirm
the same if and when requested; (ii) obtain opinions of counsel
to the Bank and the Company and updates thereof in form and
substance reasonably satisfactory to the managing underwriters
(if any) and the Holders of a majority in principal amount of the
Registrable Securities being sold, addressed to each selling
Holder and the underwriters (if any) covering the matters
customarily covered in opinions requested in underwritten
offerings and such other matters as may be reasonably requested
by such Holders and underwriters; (iii) obtain "cold comfort"
letters and updates thereof in form and substance reasonably
satisfactory to the managing underwriters (if any) from the
independent certified public accountants of the Bank and the
Company (and, if necessary, any other independent certified
public accountants of any subsidiary of the Company or of any
business acquired by the Bank or the Company for which financial
statements and financial data are, or are required to be,
included in the Registration Statement), addressed to the selling
Holders of Registrable Securities and to each of the underwriters
(if any), such letters to be in customary form and covering
matters of the type customarily covered in "cold comfort" letters
in connection with underwritten offerings and such other matters
as reasonably requested by such selling Holders and underwriters;
and (iv) if an underwriting agreement is entered into, the same
shall contain indemnification provisions and procedures no less
favorable than those set forth in Section 4 hereof (or such other
less favorable provisions and procedures acceptable to Holders of
a majority in aggregate principal amount of Registrable
Securities covered by such Registration Statement and the
managing underwriters or agents) with respect to all parties to
be indemnified pursuant to said Section (including, without
limitation, such underwriters and selling Holders). The above
shall be done at each closing under such underwriting agreement
upon the request of the Majority Holders, or as and to the extent
required thereunder;
(m) if (1) a Shelf Registration is filed pursuant to Section
2(b) or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2(a) is required
to be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period, upon the request of the Initial Purchaser,
make available for inspection by a representative or
representatives (reasonably acceptable to the Bank) of the
selling Holders of such Registrable Securities being sold, or
each such Participating Broker-Dealer, as the case may be, any
underwriter participating in any such disposition of Registrable
Securities, if any, (collectively, the "Inspectors"), at the
offices where normally kept, during reasonable business hours,
all financial and other records, pertinent corporate documents
and properties of the Company, the Bank and its subsidiaries
(collectively, the "Records") as shall be reasonably necessary to
enable them to exercise any applicable due diligence
responsibilities, and cause the officers, directors and employees
of the Company or the Bank and its subsidiaries to supply all
information in each case reasonably requested by any such
Inspector in connection with such Registration Statement. Records
which the Company or the Bank determines, in good faith, to be
confidential or any Records which they notify the Inspectors are
confidential shall not be disclosed by the Inspectors unless (i)
the disclosure of such Records is necessary in connection with
the Inspectors' assertion of any claims or actions or with their
establishment of any defense in an action then pending before a
court of competent jurisdiction, (ii) the release of such Records
is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction or (iii) the information in such Records
has been made generally available to the public. Each selling
Holder of such Registrable Securities and each such Participating
Broker-Dealer will be required to agree that information obtained
by it as a result of such inspections shall be deemed
confidential and shall not be used by it as the basis for any
market transactions in the securities of the Company or the Bank
unless and until such is made generally available to the public.
Each selling Holder of such Registrable Securities and each such
Participating Broker-Dealer will be required to further agree
that it will, prior to disclosure of such Records pursuant to
clause (i) or (ii) above, give prompt notice to the Company and
the Bank and allow the Company and the Bank at their expense to
undertake appropriate action to prevent disclosure to the public
of the Records deemed confidential;
10
(n) comply with all applicable rules and regulations of the
SEC and make generally available to their securityholders
earnings statements satisfying the provisions of Section 11(a) of
the Securities Act and Rule 158 thereunder (or any similar rule
promulgated under the Securities Act) as promptly as practicable;
(o) cooperate with each seller of Registrable Securities
covered by any Registration Statement and each underwriter, if
any, participating in the disposition of such Registrable
Securities and their respective counsel in connection with any
filings required to be made with the NASD;
(p) in the case of the Exchange Offer Registration Statement
(i) include in the Exchange Offer Registration Statement a
section entitled "Plan of Distribution," which section shall be
reasonably acceptable to the Initial Purchaser or another
representative of the Participating Broker-Dealers, and which
shall contain a summary statement of the positions taken or
policies made by the staff of the SEC with respect to the
potential "underwriter" status of any broker-dealer (a
"Participating Broker-Dealer") that holds Registrable Securities
acquired for its own account as a result of market-making
activities or other trading activities and that will be the
beneficial owner (as defined in Rule 13d-3 under the Exchange
Act) of Exchange Securities to be received by such broker-dealer
in the Exchange Offer, whether such positions or policies have
been publicly disseminated by the staff of the SEC or such
positions or policies, in the reasonable judgment of the Initial
Purchaser or such other representative, represent the prevailing
views of the staff of the SEC, including a statement that any
such broker-dealer who receives Exchange Securities for
Registrable Securities pursuant to the Exchange Offer may be
deemed a statutory underwriter and must deliver a prospectus
meeting the requirements of the Securities Act in connection with
any resale of such Exchange Securities, (ii) furnish to each
Participating Broker-Dealer who has delivered to the Company the
notice referred to in Section 3(e), without charge, as many
copies of each Prospectus included in the Exchange Offer
Registration Statement, including any preliminary prospectus, and
any amendment or supplement thereto, as such Participating
Broker-Dealer may reasonably request, (iii) subject to the last
paragraph of this Section 3 hereby consent to the use of the
Prospectus forming part of the Exchange Offer Registration
Statement or any amendment or supplement thereto, by any Person
subject to the prospectus delivery requirements of the SEC,
including all Participating Broker-Dealers, in connection with
the sale or transfer of the Exchange Securities covered by the
Prospectus or any amendment or supplement thereto, for a period
of up to six months, (iv) use their best efforts to keep the
Exchange Offer Registration Statement effective and to amend and
supplement the Prospectus contained therein in order to permit
such Prospectus to be lawfully delivered by all Persons subject
to the prospectus delivery requirements of the Securities Act for
such period of time as such Persons must comply with such
requirements in order to resell the Exchange Securities;
provided, however, that such period shall not be required to
exceed 180 days (or such longer period if extended pursuant to
the last sentence of Section 3 hereof) (the "Applicable Period"),
and (iv) include in the transmittal letter or similar
documentation to be executed by an exchange offeree in order to
participate in the Exchange offer (x) the following provision:
"If the exchange offeree is a broker-dealer holding
Registrable Securities acquired for its own account as a
result of market-making activities or other trading
activities, it will deliver a prospectus meeting the
requirements of the Securities Act in connection with any
resale of Exchange Securities received in respect of such
Registrable Securities pursuant to the Exchange Offer";
and (y) a statement to the effect that by a Participating
Broker-Dealer making the acknowledgment described in clause (x)
and by delivering a Prospectus in connection with the exchange of
Registrable Securities, such Participating Broker-Dealer will not
be deemed to admit that it is an underwriter within the meaning
of the Securities Act.
11
The Company and the Bank may require each seller of
Registrable Securities as to which any registration is being
effected to furnish to the Company and the Bank such information
regarding such seller and the proposed distribution of such
Registrable Securities, as the Company or the Bank may from time
to time reasonably request in writing. The Company and the Bank
may exclude from such registration the Registrable Securities of
any seller who fails to furnish any such information which the
Company or the Bank reasonably requires in order for the Shelf
Registration Statement to comply with applicable law and SEC
policy within a reasonable time after receiving such request and
shall be under no obligation to compensate any such seller for
any lost income, interest or other opportunity foregone, or any
liability incurred, as a result of the Company's or the Bank's
decision to exclude such seller.
In the case of (1) a Shelf Registration Statement or (2)
Participating Broker-Dealers who have notified the Company and the Bank that
they will be utilizing the Prospectus contained in the Exchange Offer
Registration Statement as provided in Section 3(r) hereof that are seeking to
sell Exchange Securities and are required to deliver Prospectuses, each Holder
or Participating Broker-Dealer, as the case may be, agrees that, upon receipt of
any notice from the Company or the Bank of the happening of any event of the
kind described in Section 3(e)(ii), 3(e)(iii), 3(e)(v), 3(e)(vi) or 3(e)(vii)
hereof, such Holder or Participating Broker-Dealer, as the case may be, will
forthwith discontinue disposition of Registrable Securities pursuant to a
Registration Statement or Exchange Securities, as the case may be, until such
Holder's or Participating Broker-Dealer's, as the case may be, receipt of the
copies of the supplemented or amended Prospectus contemplated by Section 3(i)
hereof or until it is advised in writing (the "Advice") by the Company that the
use of the applicable Prospectus may be resumed, and, if so directed by the
Company, such Holder or Participating Broker-Dealer, as the case may be, will
deliver to the Company (at the Company's expense) all copies in such Holder's or
Participating Broker-Dealer's, as the case may be, possession, other than
permanent file copies then in such Holder's or Participating Broker-Dealer's, as
the case may be, possession, of the Prospectus covering such Registrable
Securities or Exchange Securities, as the case may be, current at the time of
receipt of such notice. If the Company or the Bank shall give any such notice to
suspend the disposition of Registrable Securities or Exchange Securities, as the
case may be, pursuant to a Registration Statement, (x) the Company and the Bank
shall use their best efforts to file and have declared effective (if an
amendment) as soon as practicable an amendment or supplement to the Registration
Statement and, in the case of an amendment, have such amendment declared
effective as soon as practicable; provided, however, that the Company or the
Bank may postpone the filing of such amendment or supplement for a period not to
extend beyond the earlier to occur of (I) 30 days after the date of the
determination of the Board of Directors referred to below and (II) the day after
the cessation of the circumstances described below upon which such postponement
is based, if the Board of Directors of the Company or the Bank determines
reasonably and in good faith that such filing would require disclosure of
material information which the Company or the Bank has a bona fide purpose for
preserving as confidential; provided, further, however, that the Company shall
be entitled to such postponement only once during any 12-month period and the
exercise by the Company of its rights under this provision shall not relieve it
of any obligation to pay liquidated damages under Section 2(e); and (y) the
Company and the Bank shall extend the period during which such Registration
Statement shall be maintained effective pursuant to this Agreement by the number
of days in the period from and including the date of the giving of such notice
to and including the date when the Company or the Bank shall have made available
to the Holders or Participating Broker-Dealers, as the case may be, (x) copies
of the supplemented or amended Prospectus necessary to resume such dispositions
or (y) the Advice.
4. Indemnification and Contribution. (a) The Company and the
Bank shall, jointly and severally, indemnify and hold harmless the Initial
Purchaser, each Holder, including Participating Broker-Dealers, each underwriter
who participates in an offering of Registrable Securities, their respective
affiliates, each Person, if any, who controls any of such parties within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
and each of their respective directors, officers, employees and agents, as
follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact
contained in any Registration Statement (or any amendment or
supplement thereto), covering Registrable Securities or
12
Exchange Securities, including all documents incorporated
therein by reference, or the omission or alleged omission
therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement
of a material fact contained in any Prospectus (or any amendment
or supplement thereto) or the omission or alleged omission
therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the prior written
consent of the Company and the Bank; and
(iii) against any and all expenses whatsoever, as incurred
(including reasonable fees and disbursements of one counsel
chosen by all indemnified parties with respect to any single
claim (except to the extent otherwise expressly provided in
Section 4(c) hereof)), reasonably incurred in investigating,
preparing or defending against any litigation, or any
investigation or proceeding by any court or governmental agency
or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged
untrue statement or omission, to the extent that any such expense
is not paid under subparagraph (i) or (ii) of this Section 4(a);
provided, however, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission (i) made in reliance upon and
in conformity with written information furnished in writing to the Company or
the Bank by the Initial Purchaser, such Holder, such Participating Broker-Dealer
or any underwriter with respect to such Initial Purchaser, Holder, Participating
Broker-Dealer or underwriter, as the case may be, expressly for use in the
Registration Statement (or any amendment or supplement thereto) or any
Prospectus (or any amendment or supplement thereto) or (ii) contained in any
Prospectus if such Initial Purchaser, such Holder, including Participating
Broker-Dealers or such underwriter failed to send or deliver a copy of the
Prospectus (as amended or supplemented) to the Person asserting such losses,
claims, damages or liabilities on or prior to the delivery of written
confirmation of any sale of securities covered thereby to such Person in any
case where such delivery is required by the Securities Act and a court of
competent jurisdiction in a judgment not subject to appeal or final review shall
have determined that such Prospectus would have corrected such untrue statement
or omission. Any amounts advanced by the Company or the Bank to an indemnified
party pursuant to this Section 4 as a result of such losses shall be returned to
the Company or the Bank if it shall be finally determined by such a court in a
judgment not subject to appeal or final review that such indemnified party was
not entitled to indemnification by the Company or the Bank.
(b) Each Holder agrees, severally and not jointly, to
indemnify and hold harmless the Company, the Bank, the Initial Purchaser, each
underwriter who participates in an offering of Registrable Securities and the
other selling Holders and each of their respective directors, officers
(including each officer of the Company or the Bank who signed the Registration
Statement), employees and agents and each Person, if any, who controls the
Company, the Bank, the Initial Purchaser, any underwriter or any other selling
Holder within the meaning of Section 15 of the Act or Section 20 of the Exchange
Act, against any and all loss, liability, claim, damage and expense whatsoever
described in the indemnity contained in Section 4(a) hereof, as incurred, but
only with respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in the Registration Statement (or any amendment
thereto) or any Prospectus (or any amendment or supplement thereto) in reliance
upon and in conformity with written information furnished to the Company or the
Bank by such selling Holder expressly for use in the Registration Statement (or
any supplement thereto), or any such Prospectus (or any amendment or supplement
thereto); provided, however, that, in the case of the Shelf Registration
Statement, no such Holder shall be liable for any claims hereunder in excess of
the amount of net proceeds received by such Holder from the sale or other
disposition of Registrable Securities pursuant to such Shelf Registration
Statement.
13
(c) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure to
so notify an indemnifying party shall not relieve such indemnifying party from
any liability hereunder to the extent it is not materially prejudiced as a
result thereof and in any event shall not relieve it from any liability which it
may have otherwise than on account of this indemnity agreement. In the case of
parties indemnified pursuant to Section 4(a) above, counsel to the indemnified
parties shall be selected by the Initial Purchaser, and, in the case of parties
indemnified pursuant to Section 4(b) above, counsel to the indemnified parties
shall be selected by the Company and the Bank. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 4 (whether or
not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) 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.
(d) If at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for reasonable fees and
expenses of counsel to which such indemnified party is entitled pursuant to
Section 4(a) or (b), such indemnifying party agrees that it shall be liable for
any settlement of the nature contemplated by Section 4(a)(ii) effected without
its written consent if (i) such settlement is entered into more than 215 days
after receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement (other than
reimbursement for fees and expenses that the indemnifying party is contesting in
good faith).
(e) If any of the indemnity provisions set forth in this
Section 4 is for any reason held to be unavailable to the indemnified parties
although applicable in accordance with its terms, the Company and the Bank and
the Holders, including participating Broker-Dealers shall contribute to the
aggregate losses, liabilities, claims, damages and expenses of the nature
contemplated by such indemnity agreement incurred by the Company, the Bank, the
Initial Purchaser, the Holders and the Participating Broker-Dealers; provided,
however, that 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 that was not guilty of such fraudulent
misrepresentation. As between the Company and the Holders, such parties shall
contribute to such aggregate loses, liabilities, claims, damages, and expenses
of the nature contemplated by such indemnity agreement incurred by such
indemnified party, as incurred, in such proportion as shall be appropriate to
reflect the relative fault of the Company and the Bank on the one hand and of
the Holder of Registrable Securities, the Participating Broker-Dealer or the
Initial Purchaser, as the case may be, on the other hand in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative fault of the Company and the Bank on the one hand
and the Holders of Registrable Securities, including Participating
Broker-Dealers or the Initial Purchaser, as the case may be, on the other hand,
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company and the
Bank, or by such Holder of Registrable Securities, the Participating
Broker-Dealer or the Initial
14
Purchaser, as the case may be, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company and the Bank and the Holders of the Registrable
Securities and the Initial Purchaser agree that it would not be just and
equitable if contribution pursuant to this Section 4 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 4.
For purposes of this Section 4, each affiliate of the Initial
Purchaser or any Holder, and each director, officer, employee, agent and Person,
if any, who controls a Holder of Registrable Securities, the Initial Purchaser
or a Participating Broker-Dealer within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as such other Person, and each director of the Company, the Bank,
each officer of the Company or the Bank who signed the Registration Statement,
and each director, officer, employee, agent and Person, if any, who controls the
Company or the Bank within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act shall have the same rights to contribution as the
Company and the Bank.
5. Participation in Underwritten Registrations. No Holder may
participate in any underwritten registration hereunder unless such Holder (a)
agrees to sell such Holder's Registrable Securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements. The Company and the
Bank shall be under no obligation to compensate any Holder for lost income,
interest or other opportunity foregone, or other liability incurred, as a result
of the Company's or the Bank's decision to exclude such Holder from any
underwritten registration if such Holder has not complied with the provisions of
this Section 5 in all material respects following 5 business days' written
notice of non-compliance and the Company's or the Bank's decision to exclude
such Holder.
6. Selection of Underwriters. The Holders of Registrable
Securities covered by the Shelf Registration Statement who desire to do so may
sell the securities covered by such Shelf Registration in an underwritten
offering. In any such underwritten offering, the underwriter or underwriters and
manager or managers that will administer the offering will be selected by the
Majority Holders of the Registrable Securities included in such offering;
provided, however, that such underwriters and managers must be reasonably
satisfactory to the Company and the Bank.
7. Miscellaneous.
(a) Rule 144 and Rule 144A. For so long as the Company or the
Bank is subject to the reporting requirements of Section 13 or 15 of the
Exchange Act and any Registrable Securities remain outstanding, each of the
Company and the Bank covenants that it will file the reports required to be
filed by it under the Securities Act and Section 13(a) or 15(d) of the Exchange
Act and the rules and regulations adopted by the SEC thereunder, that if it
ceases to be so required to file such reports, it will upon the request of any
Holder of Registrable Securities (a) make publicly available such information as
is necessary to permit sales pursuant to Rule 144 under the Securities Act, (b)
deliver such information to a prospective purchaser as is necessary to permit
sales pursuant to Rule 144A under the Securities Act, and (c) take such further
action that is reasonable in the circumstances, in each case, to the extent
required from time to time to enable such Holder to sell its Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by (i) Rule 144 under the Securities Act, as such
rule may be amended from time to time, (ii) Rule 144A under the Securities Act,
as such rule may be amended from time to time, or (iii) any similar rules or
regulations hereafter adopted by the SEC. Upon the reasonable written request of
any Holder of Registrable Securities, the Company and the Bank will deliver to
such Holder a written statement as to whether it has complied with such
requirements.
15
(b) The Initial Purchaser hereby undertakes on a best efforts
basis to distribute the Senior Preferred Shares to a minimum of 100 holders
independent of the Company and of one another.
(c) No Inconsistent Agreements. Neither the Company nor the
Bank have entered into nor will the Company or the Bank on or after the date of
this Agreement enter into any agreement which is inconsistent with the rights
granted to the Holders of Registrable Securities in this Agreement or otherwise
conflicts with the provisions hereof. The rights granted to the Holders
hereunder do not in any way conflict with and are not inconsistent with the
rights granted to the holders of the Bank's other issued and outstanding
securities under any such agreements.
(d) Amendments and Waivers. The provisions of this Agreement,
including provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, otherwise than with the prior written consent of the Company
and the Bank and the Majority Holders affected by any such amendment,
modification or supplement; provided, however, that no amendment, modification,
or supplement or waiver or consent to the departure with respect to the
provisions of Section 4 hereof shall be effective as against any Holder of
Registrable Securities unless consented to in writing by such Holder of
Registrable Securities.
(e) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telex, telecopier, or any courier guaranteeing overnight
delivery (i) if to a Holder (other than the Initial Purchaser), at the most
current address set forth in the records of the Registrar, (ii) if to the
Initial Purchaser, at the most current address given by the Initial Purchaser to
the Company by means of a notice given in accordance with the provisions of this
Section 7(d), the address set forth in the Purchase Agreement and (iii) if to
the Company or the Bank, initially at the address set forth in the Purchase
Agreement and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 7(e).
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is acknowledged, if telecopied; and
on the next Business Day, if timely delivered to an air courier guaranteeing
overnight delivery.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns and transferees of each
of the parties hereto, including, without limitation and without the need for an
express assignment, subsequent Holders; provided, however, that nothing herein
shall be deemed to permit any assignment, transfer or other disposition of
Registrable Securities in violation of the terms of the Purchase Agreement. If
any transferee of any Holder shall acquire Registrable Securities, in any
manner, whether by operation of law or otherwise, such Registrable Securities
shall be held subject to all of the terms of this Agreement, and by taking and
holding such Registrable Securities, such Person shall be conclusively deemed to
have agreed to be bound by and to perform all of the terms and provisions of
this Agreement, including the restrictions on resale set forth in this Agreement
and, if applicable, the Purchase Agreement, and such Person shall be entitled to
receive the benefits hereof.
(g) Third Party Beneficiary. The Holders shall be third party
beneficiaries of the agreements made hereunder between the Company and the Bank,
on the one hand, and the Initial Purchaser, on the other hand, and shall have
the right to enforce such agreements directly to the extent they deem such
enforcement necessary or advisable to protect their rights or the rights of
Holders hereunder.
(h) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
16
(i) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(j) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. Specified times
of day refer to New York City time.
(k) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
(l) Securities Held by the Company, the Bank or any of their
Affiliates. Whenever the consent or approval of Holders of a specified
percentage of Registrable Securities is required hereunder, Registrable
Securities held by the Company, the Bank or any of their affiliates (as such
term is defined in Rule 405 under the Securities Act) shall not be counted in
determining whether such consent or approval was given by the Holders of such
required percentage.
(m) Submission to Jurisdiction. By execution and delivery of
this Agreement, the Bank (i) acknowledges that it has irrevocably designated and
appointed the Company as its agent in The City of New York upon whom process may
be served in any suit or proceeding arising out of or relating to this Agreement
that may be instituted in the Supreme Court of the State of New York or the
United States District Court for the Southern District of New York, in either
case in the Borough of Manhattan, The City of New York, and acknowledges that
the Company has accepted such designation, (ii) submits to the nonexclusive
jurisdiction of any such court in any such suit or proceeding, and (iii) agrees
that service of process upon the Company and written notice of said service to
the Bank (mailed or delivered in each case as specified in Section 7 (e) hereof)
shall be deemed in every respect effective service of process upon the Bank in
any such suit or proceeding. The Bank further agrees to take any and all action,
including the execution and filing of any and all such documents and
instruments, as may be necessary to continue such designation and appointment of
the Company in full force and effect so long as this Agreement shall be in full
force and effect.
17
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
NB CAPITAL CORPORATION
By:
------------------------------
Name:
Title:
NATIONAL BANK OF CANADA
By:
------------------------------
Name:
Title:
Confirmed and accepted as of
the date first above written:
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By:
----------------------------
Name:
Title:
0178142.05-01S3a