Exhibit 10.2
EXECUTION COPY
INVESTOR RIGHTS
AGREEMENT
This INVESTOR RIGHTS AGREEMENT (this
“ Agreement ”) is made as of the 6th day of
April, 2005, by and between The Peoples BancTrust Company, Inc., an
Alabama business corporation and bank holding company (the “
Company ”), and Endurance Capital Investors, L.P., a
Delaware limited partnership (“ Endurance
”).
WHEREAS, the Company and Endurance
have entered into a stock purchase agreement dated as of April 6,
2005 (the “ Purchase Agreement ”), whereby
Endurance is purchasing shares of Common Stock (as defined below)
from the Company;
WHEREAS, after Endurance purchases
the Shares, it will own 567,588 shares of Common Stock;
and
WHEREAS, the Company has agreed to
provide Endurance with certain information rights regarding the
Company and with certain registration rights with respect to the
shares of Common Stock Endurance will own as set forth
herein.
NOW, THEREFORE, in consideration of
the foregoing and the mutual covenants of the parties set forth
herein and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, subject to the
terms and conditions set forth herein, the parties hereby agree as
follows:
Section 1. Certain
Definitions . In this Agreement, the following terms shall have
the meanings specified below. Capitalized terms not otherwise
defined herein shall have the meanings ascribed to them in the
Purchase Agreement.
“ Agreement ”
shall have the meaning ascribed to it in the preamble of this
Agreement.
“ Bank ” shall
mean The Peoples Bank and Trust Company, an Alabama banking
corporation.
“ Business Day ”
shall mean any day of the year other than (a) any Saturday or
Sunday or (b) any other day on which the Bank or banks located in
New York, New York are generally closed for business.
“ Common Stock ”
shall mean the Company’s common stock, $.10 par value per
share.
“ Company ” shall
have the meaning ascribed to it in the preamble of this
Agreement.
“ CPR ” shall
mean Center for Public Resources.
“ Endurance ”
shall have the meaning ascribed to it in the preamble of this
Agreement.
“ Exchange Act ”
shall mean the Securities Exchange Act of 1934.
“ Fair Market Value
” shall mean the average of the daily high sales price per
share of Common Stock and daily low sales price per share of Common
Stock as of a given day or over a specified period.
“ GAAP ” shall
mean United States generally accepted accounting principles at the
time in effect.
“ Governmental
Authority ” shall mean the government of the United
States or any foreign country or any state or political subdivision
thereof or any entity, body or authority exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government, including any quasi-governmental entity
established to perform such functions.
“ Indemnified Party
” shall have the meaning ascribed to it in Section
8(c) of this Agreement.
“ Indemnifying Party
” shall have the meaning ascribed to it in Section
8(c) of this Agreement.
“ Law ” shall
mean any law, statute, regulation, ordinance, rule, order
(including cease and desist orders), decree (including consent
decrees), memorandum of understanding, directive, regulatory
action, judgment , settlement agreement or other
governmental requirement enacted, promulgated or imposed by any
Governmental Authority.
“ Loss ” or
“ Losses ” shall mean any and all losses
(including reductions in value), liabilities, costs, claims,
damages and expenses (including attorney’s fees and expenses
and costs of investigation and litigation).
“ Person ” shall
mean any individual, corporation, proprietorship, firm,
partnership, limited partnership, limited liability company, trust,
association or other entity, as well as any syndicate or group that
would be deemed to be a person under Section 13(d) of the Exchange
Act.
“ Piggyback Notice
” shall have the meaning ascribed to it in Section
3(a) of this Agreement.
“ Piggyback
Registration ” shall have the meaning ascribed to it in
Section 3(a) of this Agreement.
“ Purchase Agreement
” shall have the meaning ascribed to it in the recitals to
this Agreement.
Unless the context otherwise
requires, the terms “ register ,” “
registered ” and “ registration ”
refer to a registration effected by preparing and filing a
registration statement in compliance with the Securities Act and
the declaration or ordering of the effectiveness of such
registration statement by the SEC.
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“ Registrable Stock
” shall mean the Common Stock owned by Endurance as of the
date hereof and any other Common Stock issuable upon any stock
split, stock dividend, recapitalization or otherwise with respect
to such Common Stock.
“ Rule 144 ”
shall mean Rule 144 promulgated by the SEC under the Securities
Act.
“ SEC ” shall
mean the United States Securities and Exchange Commission or its
successor in interest.
“ Securities Act
” shall mean the Securities Act of 1933.
“ Registration Request
” shall have the meaning ascribed to it in Section
2(a) of this Agreement.
“ Shares ” shall
mean the number of shares of the Company’s Common Stock that
Endurance purchased under the Purchase Agreement.
“ Subsidiary ,”
when used with reference to a specified Person, means any
corporation, partnership, trust or other entity of which the
majority of outstanding voting securities are owned (directly or
indirectly) by such Person, unless the context otherwise requires,
any reference to a Subsidiary shall be a Subsidiary of the
Company.
“ Suspension Right
” shall have the meaning ascribed to it in Section
2(c) of this Agreement.
Section 2. Demand
Registration .
(a) (i) Upon receipt of a written
request from Endurance to the Company (a “ Registration
Request ”) delivered not earlier than one (1) year after
the date hereof, the Company shall promptly prepare and file with
the SEC, but in any event within 90 days after its receipt of such
Registration Request, a registration statement for the purpose of
effecting a registration of the sale of all Registrable Stock
requested to be Registered by Endurance. Unless otherwise requested
in the Registration Request, each such registration shall be an
underwritten registration, and Endurance shall have the right to
designate the lead managing underwriter for such registration;
provided , however , that such underwriter is
reasonably satisfactory to the Company. The Company shall use its
best efforts to effect such registration as soon as practicable
(including, without limitation, the execution of an undertaking to
file post-effective amendments and appropriate qualification under
applicable state securities laws).
(ii) The Company shall not be
required to effect (A) more than two registrations pursuant to
Section 2(a)(i) or (B) a registration of Registrable Stock,
(1) of less than 50% of the Shares issued pursuant to the Purchase
Agreement or (2) if the Fair Market Value of the Registrable Stock
on the date of the Registration Request is less than $1,000,000. No
registration shall be counted toward the number set forth in
Section 2(a)(ii)(A) unless and until such registration has
been declared effective by the SEC and remains continuously
effective until the earlier of (x) 180 days thereafter and (y) the
date on which all shares of Registrable Stock registered in such
registration have been sold (but not before the expiration of the
period referred
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to in Section 4(3) of the Securities Act and
Rule 174 thereunder, if applicable). The Company shall not be
required to prepare and file a registration statement or otherwise
effect a registration under this Section 2 during the period
beginning on the date of filing of, and ending on the date one
hundred eighty (180) days following, the effective date of a
registration statement pertaining to a public offering of Common
Stock, whether such registration statement was filed pursuant to a
demand under Section 2 of this Agreement or otherwise;
provided that the Company makes reasonable good faith efforts to
cause such registration statement to become effective.
(b) The Company shall keep any
registration effected pursuant to Section 2(a) continuously
effective until the earliest of (i) 180 days thereafter, (ii) the
date on which all shares of Registrable Stock registered in such
registration have been sold pursuant to an effective registration
statement or Rule 144 and (iii) the date on which, in the
reasonable opinion of counsel to the Company, all of the
Registrable Stock registered in such registration may be sold in
accordance with Rule 144(k).
(c) Notwithstanding the foregoing,
the Company shall have the right (the “ Suspension
Right ”) to defer any such filing under Section
2(a) (or suspend sales under any registration statement filed
under Section 2(a) or defer the updating of any such filed
registration statement and suspend sales thereunder) at any time or
from time to time, for one period of not more than 90 days during
any period of 365 days, if the Company shall furnish to Endurance a
certificate signed by the Chief Executive Officer of the Company
stating that, in the good faith judgment of the Company, it would
be detrimental to the Company and its stockholders to file such
registration statement or amendment thereto at such time (or
continue sales under a filed registration statement) and therefore
the Company has elected to defer the filing of such registration
statement (or suspend sales under a filed registration statement),
and the reasons for such judgment.
Section 3. Piggyback
Registrations .
(a) If the Company proposes to
register any Common Stock or any securities convertible into Common
Stock under the Securities Act (other than pursuant to (i) a
registration on Form S-4 or any successor form or on Form S-3 in
the case of a resale prospectus delivered to selling shareholders
in any acquisition transaction structured as a private placement or
(ii) an offering of securities in connection with an employment
agreement or employee benefit, share dividend, share ownership or
dividend reinvestment plan) and the registration form to be used
may be used for the registration of Registrable Stock, the Company
shall give prompt written notice to Endurance of its intention to
effect such a registration (each, a “ Piggyback Notice
”) and, subject to Section 3(c) , the Company shall
include in such registration all or any portion of the Registrable
Stock as so designated by Endurance as directed by Endurance
pursuant to a written request for inclusion therein within 15
Business Days after the date of receipt by Endurance of the
Piggyback Notice (a “ Piggyback Registration ”).
Nothing herein shall affect the right of the Company to withdraw
any such registration in its sole discretion, whether or not
Endurance has elected to include Registrable Stock in such
registration.
(b) If a Piggyback Registration is a
primary underwritten registration and the managing underwriters
advise the Company in writing that, in their opinion, registration
of the number of securities requested to be included in such
registration would materially adversely
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affect the registration, offering and sale of
the Registered Stock, the Company shall include in such
registration (i) first, the securities the Company proposes to sell
and (ii) second, the Registrable Stock and similar securities
requested to be included in such registration pro rata according to
the total number of Registrable Stock and similar securities
requested to be registered among Endurance and other Persons who
have similar rights on the basis of the number of shares of Common
Stock requested to be included in such registration by each such
Person.
(c) If a Piggyback Registration is a
secondary underwritten registration on behalf of third parties and
the managing underwriters advise the Company in writing that, in
their opinion, registration of the number of securities requested
to be included in such registration would materially adversely
affect the registration, offering and sale of the Registered Stock,
the Company shall include in such registration the Registrable
Stock and similar securities requested to be included in such
registration pro rata according to the total number of Registrable
Stock and similar securities requested to be registered among
Endurance and other Persons who have similar rights on the basis of
the number of shares of Common Stock requested to be included in
such registration by each such Person.
(d) In the case of an underwritten
Piggyback Registration, the Company will have the right to select
the investment banker(s) and manager(s) to administer the offering,
and Endurance’s right to be included in such registration
pursuant to this Section 3 shall be conditioned on
Endurance’s participation in such underwriting and the
inclusion of the Registrable Stock in the underwriting to the
extent provided in this Section 3 .
Section 4. Exchange Act
Registration . The Company (a) shall (i) remain organized under
the laws of Alabama or another State of the United States of
America and will continue to have its principal operations in
Alabama or another State of the United States of America and (ii)
cause its Common Stock to continue to be registered under Section
12(b) or 12(g) of the Exchange Act, (b) shall comply in all
respects with its reporting and filing obligations under the
Exchange Act, and shall not take any action or file any document
(whether or not permitted by the Exchange Act) to terminate or
suspend such registration or to terminate or suspend its reporting
and filing obligations under the Exchange Act and (c) shall
otherwise remain eligible to file a registration statement on Form
S-3.
Section 5. Limitations on
Subsequent Registration Rights . The Company shall not, without
the consent of Endurance, enter into any agreement granting any
holder or prospective holder of any securities of the Company
registration rights with respect to such securities unless (i) such
new registration rights are on a pari passu basis with those rights
granted to Endurance hereunder, or (ii) such new registration
rights, are subordinate to the registration rights granted to
Endurance hereunder.
Section 6. Registration
Procedures .
(a) The Company shall provide
Endurance with a reasonable opportunity to review any registration
statement or prospectus relating to Registrable Stock or amendment
or supplement thereto prior to filing, if such registration
statement, prospectus, amendment or supplement contains information
about Endurance other than the name of Endurance, the number of
shares of Common Stock held by Endurance and the number of shares
being sold by Endurance, if applicable.
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(b) The Company shall promptly
notify Endurance of the occurrence of the following
events:
(i) when any registration statement
relating to the Registrable Stock or post-effective amendment
thereto filed with the SEC has become effective;
(ii) the issuance by the SEC of any
request for amendment or supplement or the issuance of any stop
order suspending the effectiveness of any registration statement
relating to the Registrable Stock;
(iii) the Company’s receipt of
any notification of the suspension of the qualification of any
Registrable Stock covered by a registration statement for sale in
any jurisdiction; and
(iv) the existence of any event,
fact or circumstance that results in a registration statement or
prospectus relating to Registrable Stock or any document
incorporated therein by reference containing an untrue statement of
material fact or omitting to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading during the distribution of the Registrable
Stock.
The Company agrees to use its best
efforts to obtain the withdrawal of any order suspending the
effectiveness of any such registration statement or any
qualification as promptly as possible. Endurance agrees that upon
receipt of any notice from the Company of the occurrence of any
event of the type described in Sections 6(b)(ii) ,
(iii) or (iv) , to immediately discontinue its
disposition of Registrable Stock pursuant to any registration
statement relating to such Registrable Stock until Endurance
receives written notice from the Company that such disposition may
be made.
(c) The Company shall provide to
Endurance, at no cost to Endurance, such reasonable number of
copies of the registration statement and any amendment thereto used
to effect the registration of the Registrable Stock, each
prospectus contained in such registration statement or
post-effective amendment and any amendment or supplement thereto
and such other documents as Endurance may reasonably request in
order to facilitate the disposition of the Registrable Stock
covered by such registration statement. The Company c
