Exhibit 10.1
EXECUTION COPY

 
 
REGISTRATION RIGHTS AGREEMENT
dated as of October 15, 2010
by and between
PATRIOT NATIONAL BANCORP, INC.
and
PNBK HOLDINGS LLC

 
 

 

 

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Table of Contents

         
1. Certain Definitions
    1  
 
       
2. Shelf Registration Statements
    4  
 
       
3. Additional Demand Registrations
    5  
 
       
4. Piggyback Registrations
    6  
 
       
5. Other Registrations
    7  
 
       
6. Selection of Underwriters
    8  
 
       
7. Holdback Agreements
    8  
 
       
8. Procedures
    8  
 
       
9. Registration Expenses
    13  
 
       
10. Indemnification
    14  
 
       
11. Rule 144
    15  
 
       
12. Transfer of Registration Rights
    16  
 
       
13. Conversion or Exchange of Other Securities
    16  
 
       
14. Miscellaneous
    17  

 

 

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REGISTRATION RIGHTS AGREEMENT, dated as of October 15, 2010, by and between
Patriot National Bancorp, Inc., a Connecticut corporation (the “Company”), and
PNBK Holdings LLC, a Delaware limited liability company (“Investor”).
In consideration of the mutual covenants and agreements herein contained and
other good and valid consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties to this Agreement hereby agree as follows:
1. Certain Definitions.
In addition to the terms defined elsewhere in this Agreement, the following
terms shall have the following meanings:
“Affiliate” of any Person means any other Person that, directly or indirectly,
through one or more intermediaries, controls, or is controlled by, or is under
common control with, such Person. The term “control” (including the terms
“controlling,” “controlled by” and “under common control with”) as used with
respect to any Person means the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities, by contract or otherwise.
“Agreement” means this Registration Rights Agreement, including all amendments,
modifications and supplements and any exhibits or schedules to any of the
foregoing, and shall refer to this Registration Rights Agreement as the same may
be in effect at the time such reference becomes operative.
“Blackout Period” has the meaning set forth in Section 8(e) hereof.
“Business Day” means any day, except a Saturday, Sunday or legal holiday on
which banking institutions in the State of New York or State of Connecticut are
authorized or obligated by law or executive order to close.
“Closing Date” has the meaning set forth in the Securities Purchase Agreement.
“Common Stock” means common stock, par value $0.01 per share, of the Company.
“Company” has the meaning set forth in the introductory paragraph and includes
any other person referred to in the second sentence of Section 14(c) hereof.
“Delay Period” has the meaning set forth in Section 3(d) hereof.
“Demand Registration” has the meaning set forth in Section 3(a) hereof.
“Demand Registration Statement” has the meaning set forth in Section 3(a)
hereof.

 

 

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“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“FINRA” means the Financial Industry Regulatory Authority, Inc.
“Full Cooperation” means, in connection with any underwritten offering, where,
in addition to the cooperation otherwise required by this Agreement, (a) members
of senior management of the Company (including the chief executive officer and
chief financial officer) fully cooperate with the underwriter(s) in connection
therewith and, at the recommendation or request of the underwriters, make
themselves available to participate in “road-show” and other customary marketing
activities in such locations (domestic and foreign) as recommended by the
underwriter(s) (including one-on-one meetings with prospective purchasers of the
Registrable Common Stock) and (b) the Company prepares preliminary and final
prospectuses (preliminary and final prospectus supplements in the case of an
offering pursuant to the Shelf Registration Statement) for use in connection
therewith containing such additional information as reasonably requested by the
underwriter(s) (in addition to the minimum amount of information required by
law, rule or regulation).
“Fully Marketed Underwritten Offering” means an underwritten offering in which
there is Full Cooperation.
“Governmental Entity” means any national, federal, state, municipal, local,
territorial, foreign or other government or any department, commission, board,
bureau, agency, regulatory authority or instrumentality thereof, or any court,
judicial, administrative or arbitral body or public or private tribunal.
“Investor” has the meaning set forth in the introductory paragraph.
“NASDAQ” means The NASDAQ Stock Market LLC.
“Permitted Transferee” means an Affiliate of the Investor or any member, limited
partner or shareholder of the Investor or member, limited partner or shareholder
of the Investor’s Affiliates.
“Person” means any individual, sole proprietorship, partnership, limited
liability company, joint venture, trust, unincorporated organization,
association, corporation, institution, public benefit corporation, Governmental
Entity or any other entity.
“Piggyback Registration” has the meaning set forth in Section 4(a) hereof.
“Piggyback Registration Statement” has the meaning set forth in Section 4(a)
hereof.

 

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“Prospectus” means the prospectus or prospectuses forming a part of, or deemed
to form a part of, or included in, or deemed included in, any Registration
Statement, as amended or supplemented by any prospectus supplement with respect
to the terms of the offering of any portion of the Registrable Common Stock
covered by such Registration Statement and by all other amendments and
supplements to the prospectus, including post-effective amendments and all
material incorporated by reference in such prospectus or prospectuses.
“Registrable Common Stock” means (i) any shares of Common Stock issued as Stock
Consideration and (ii) any other security into or for which the Common Stock
referred to in clause (i) has been converted, substituted or exchanged, and any
security issued or issuable with respect thereto upon any stock dividend or
stock split or in connection with a combination of shares, reclassification,
recapitalization, merger, consolidation or other reorganization or otherwise.
“Registration Expenses” has the meaning set forth in Section 9(a) hereof.
“Registration Statement” means any registration statement of the Company that
covers any of the Registrable Common Stock pursuant to the provisions of this
Agreement, including the Prospectus, amendments and supplements to such
Registration Statement, including post-effective amendments, all exhibits and
all materials incorporated by reference in such Registration Statement.
“Rule 144” means Rule 144 promulgated by the SEC pursuant to the Securities Act,
as such rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC as a replacement thereto having substantially the
same effect as such rule.
“Rule 415” means Rule 415 promulgated by the SEC pursuant to the Securities Act,
as such rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC as a replacement thereto having substantially the
same effect as such rule.
“SEC” means the Securities and Exchange Commission.
“Securities Act” means the Securities Act of 1933, as amended.
“Securities Purchase Agreement” means the Securities Purchase Agreement, dated
as of December 16, 2009, by and among the Company, Patriot National Bank, a
banking subsidiary of the Company organized under the laws of the United States
of America, and Investor, as amended. All capitalized terms used herein but not
otherwise defined shall have those meanings set forth in the Securities Purchase
Agreement.
“Shelf Registration Statement” has the meaning set forth in Section 2(a) hereof.
“Stock Consideration” means the shares of Common Stock issued to Investor
pursuant to the Securities Purchase Agreement.

 

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“Suspension Notice” has the meaning set forth in Section 8(e) hereof.
“underwritten registration or underwritten offering” means an offering in which
securities of the Company are sold to one or more underwriters (as defined in
Section 2(a)(11) of the Securities Act) for resale to the public.
2. Shelf Registration Statements.
(a) Right to Request Registration. At the request of Investor, the Company shall
use its reasonable best efforts to promptly file a registration statement on
Form S-3 or such other form under the Securities Act then available to the
Company providing for the resale pursuant to Rule 415 from time to time by
Investor of such number of shares of Registrable Common Stock requested by
Investor to be registered thereby (including the Prospectus, amendments and
supplements to the shelf registration statement or Prospectus, including pre-
and post-effective amendments, all exhibits thereto and all material
incorporated by reference or deemed to be incorporated by reference, if any, in
such shelf registration statement, the “Shelf Registration Statement”). The
Company shall use its reasonable best efforts to cause the Shelf Registration
Statement to be declared effective by the SEC as promptly as practicable
following such filing. The Company shall maintain the effectiveness of the Shelf
Registration Statement for a period of at least eighteen (18) months in the
aggregate plus the duration of any Blackout Period. The plan of distribution
contained in the Shelf Registration Statement (or related Prospectus supplement)
shall be determined by Investor in consultation with the Company.
(b) Number of Fully Marketed Underwritten Offerings. Investor shall be entitled
to request an aggregate of four (4) Fully Marketed Underwritten Offerings
pursuant to the Shelf Registration Statement; provided, however, that Investor
shall be entitled to request no more than two (2) underwritten offerings
pursuant to the Shelf Registration Statement in any twelve (12)-month period
that require involvement by management of the Company in “road-show” or similar
marketing activities. If Investor requests a Fully Marketed Underwritten
Offering, the Company shall cause there to occur Full Cooperation in connection
therewith. An underwritten offering shall not count as one of the permitted
Fully Marketed Underwritten Offerings if there is not Full Cooperation in
connection therewith or Investor is not able to sell at least 50% of the
Registrable Common Stock desired to be sold in such Fully Marketed Underwritten
Offering. Except as provided in this Section 2(b), there shall be no limitation
on the number of takedowns off the Shelf Registration Statement.

 

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3. Additional Demand Registrations.
(a) Right to Request Registration. Any time after the date hereof, Investor may
request registration for resale under the Securities Act of all or part of the
Registrable Common Stock pursuant to a Registration Statement separate from the
Shelf Registration Statement (a “Demand Registration”). As promptly as
practicable after such request, but in any event within twenty (20) days of such
request by Investor, the Company shall file a registration statement registering
for resale such number of shares of Registrable Common Stock held by Investor as
requested to be so registered (including the Prospectus, amendments and
supplements to such registration statement or Prospectus, including pre- and
post-effective amendments, all exhibits thereto and all material incorporated by
reference or deemed to be incorporated by reference, if any, in such
registration statement, a “Demand Registration Statement”). In connection with
each such Demand Registration, the Company shall cause there to occur Full
Cooperation.
(b) Number of Demand Registrations. Investor will be entitled to request four
(4) Demand Registrations pursuant to Section 3(a) minus the number of Fully
Marketed Underwritten Offerings completed off of the Shelf Registration
Statement. A registration shall not count as one of the permitted Demand
Registrations pursuant to Section 3(a) (i) until the related Demand Registration
Statement has become effective, (ii) if Investor is not able to register and
sell at least 50% of the Registrable Common Stock requested to be included in
such registration, or (iii) if there was not Full Cooperation in connection
therewith. For avoidance of doubt, the aggregate number of Demand Registrations
and Fully Marketed Underwritten Offerings completed off of the Shelf
Registration Statement shall not exceed four (4).
(c) Priority on Demand Registrations. If a Demand Registration pursuant to this
Section 3 involves an underwritten offering and the managing underwriter shall
advise the Company that in its opinion the number of securities requested to be
included in such registration exceeds the number of securities that can be sold
in such offering without having an adverse effect on such offering, including
the price at which such securities can be sold, then the Company shall include
in such registration the maximum number of shares that such underwriter advises
can be so sold without having such effect, allocated (i) first, to Registrable
Common Stock requested by Investor to be included in such registration and
(ii) second, among all shares of Common Stock requested to be included in such
registration by any other Persons (including securities to be sold for the
account of the Company) allocated among such Persons in such manner as they may
agree.

 

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(d) Restrictions on Demand Registrations. The Company may postpone the filing or
the effectiveness of a Demand Registration Statement if, based on the good faith
judgment of the Company’s Board of Directors, such postponement is necessary in
order to avoid premature disclosure of a matter the Board of Directors has
determined would not be in the best interest of the Company to be disclosed at
such time; provided, however, that Investor requesting such Demand Registration
Statement shall be entitled, at any time after receiving notice of such
postponement and before such Demand Registration Statement becomes effective, to
withdraw such request and, if such request is withdrawn, such Demand
Registration shall not count as one of the permitted Demand Registrations. The
Company shall provide written notice to Investor of (x) any postponement of the
filing or effectiveness of a Demand Registration Statement pursuant to this
Section 3(d), (y) the Company’s decision to file or seek effectiveness of such
Demand Registration Statement following such postponement and (z) the
effectiveness of such Demand Registration Statement. The Company may defer the
filing or effectiveness of a particular Demand Registration Statement pursuant
to this Section 3(d) only once during any twelve (12)-month period.
Notwithstanding the provisions of this Section 3(d), the Company may not
postpone the filing or effectiveness of a Demand Registration Statement past the
date that is the earliest of (a) the date upon which any disclosure of a matter
the Board of Directors has determined would not be in the best interest of the
Company to be disclosed is disclosed to the public or ceases to be material,
(b) forty-five (45) days after the date upon which the Board of Directors has
determined such matter should not be disclosed and (c) such date that, if such
postponement continued, would result in there being more than ninety (90) days
in the aggregate in any twelve (12)-month period during which the filing or
effectiveness of one or more Registration Statements has been so postponed. The
period during which filing or effectiveness is so postponed hereunder is
referred to as a “Delay Period.”
(e) Effective Period of Demand Registrations. After any Demand Registration
filed pursuant to this Agreement has become effective, the Company shall use its
reasonable best efforts to keep such Demand Registration Statement effective for
a period of at least 90 days from the date on which the SEC declares such Demand
Registration Statement effective plus the duration of any Delay Period and any
Blackout Period, or such shorter period that shall terminate when all of the
Registrable Common Stock covered by such Demand Registration Statement has been
sold pursuant to such Demand Registration Statement in accordance with the plan
of distribution set forth therein.
4. Piggyback Registrations.
(a) Right to Piggyback. Whenever the Company proposes to publicly sell or
register for sale any of its common equity securities pursuant to a registration
statement (a “Piggyback Registration Statement”) under the Securities Act (other
than a registration statement on Form S-8 or on Form S-4 or any similar
successor forms thereto), whether for its own account or for the account of one
or more securityholders of the Company (a “Piggyback Registration”), the Company
shall give prompt written notice to Investor of its intention to effect such
sale or registration and, subject to Sections 4(b) and 4(c), shall include in
such transaction all Registrable Common Stock with respect to which the Company
has received a written request from Investor for inclusion therein within
fifteen (15) days after the receipt of the Company’s notice. The Company may
postpone or withdraw the filing or the effectiveness of a Piggyback Registration
at any time in its sole discretion, without prejudice to Investor’s right to
immediately request a Demand Registration or Shelf Registration Statement
hereunder. A Piggyback Registration shall not be considered a Demand
Registration for purposes of Section 3 of this Agreement or a Shelf Registration
Statement for purposes of Section 2 of this Agreement.

 

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(b) Priority on Primary Registrations. If a Piggyback Registration is initiated
as an underwritten primary registration on behalf of the Company where the
primary use of proceeds does not include the repurchase, redemption,
subscription or retirement of capital stock of the Company (a “Stock
Repurchase”), and the managing underwriter advises the Company in writing that
in its opinion the number of securities requested to be included in such
registration exceeds the number of securities that can be sold in such offering
without having an adverse effect on such offering, including the price at which
such securities can be sold, then the Company shall include in such registration
the maximum number of shares that such underwriter advises can be so sold
without having such effect, allocated (i) first, to the securities the Company
proposes to sell, (ii) second, to the Registrable Common Stock requested to be
included therein by Investor, and (iii) third, among other securities requested
to be included in such registration by other security holders of the Company on
such basis as such holders may agree among themselves and the Company.
(c) Priority on Secondary Registrations. If a Piggyback Registration is
initiated as an underwritten registration on behalf of a holder of the Company’s
securities other than Registrable Common Stock or on behalf of the Company where
the use of proceeds includes a Stock Repurchase, and the managing underwriter
advises the Company in writing that in its opinion the number of securities
requested to be included in such registration exceeds the number that can be
sold in such offering without having an adverse effect on such offering,
including the price at which such securities can be sold, then the Company shall
include in such registration the maximum number of shares that such underwriter
advises can be so sold without having such effect, allocated (i) first, to the
securities requested to be included therein by the holder(s) requesting such
registration and the Registrable Common Stock requested to be included in such
registration, pro rata among the holders of such securities on the basis of the
number of shares requested to be registered by such holders and (ii) second, to
other securities (including Registrable Common Stock) requested to be included
in such registration by other security holders, the Company and Investor, pro
rata among such holder(s), the Company and Investor on the basis of the number
of shares requested to be registered by them.
5. Other Registrations
The Company shall not grant to any Person the right, other than as set forth
herein, to request the Company to register any securities of the Company except
such rights as are not more favorable than or not inconsistent with the rights
granted to Investor and that do not adversely affect the priorities set forth
herein of Investor.

 

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6. Selection of Underwriters.
If any of the Registrable Common Stock covered by a Demand Registration
Statement or a Shelf Registration Statement is to be sold in an underwritten
offering, Investor shall have the right to select the managing underwriter(s) to
administer the offering subject to the prior approval of the Company, which
approval shall not be unreasonably withheld.
7. Holdback Agreements.
The Company agrees not to, and shall exercise its reasonable best efforts to
obtain agreements (in the underwriters’ customary form) from its directors,
executive officers and beneficial owners of 5% or more of the Company’s
outstanding voting stock not to, directly or indirectly offer, sell, pledge,
contract to sell, (including any short sale), grant any option to purchase or
otherwise dispose of any equity securities of the Company or enter into any
hedging transaction relating to any equity securities of the Company during the
ninety (90) days beginning on the effective date of any underwritten Demand
Registration Statement or any underwritten Piggyback Registration Statement or
the pricing date of any underwritten offering pursuant to any Registration
Statement (except as part of such underwritten offering or pursuant to
registrations on Form S-8 or S-4 or any successor forms thereto) unless the
underwriter managing the offering otherwise agrees to a shorter period.
8. Procedures.
(a) In connection with the registration and sale of Registrable Common Stock
pursuant to this Agreement, the Company shall use its reasonable best efforts to
effect the registration and the sale of such Registrable Common Stock in
accordance with Investor’s intended methods of disposition thereof, and pursuant
thereto the Company shall as expeditiously as reasonably practicable:
(i) prepare and file with the SEC a Registration Statement with respect to such
Registrable Common Stock and use its reasonable best efforts to cause such
Registration Statement to become effective as soon as practicable thereafter;
and before filing a Registration Statement or Prospectus or any amendments or
supplements thereto (including any prospectus supplement for a shelf takedown),
furnish to Investor and the underwriter or underwriters, if any, copies of all
such documents proposed to be filed, including documents incorporated by
reference in the Prospectus and, if requested by Investor, the exhibits
incorporated by reference, and Investor (and the underwriter(s), if any) shall
have the opportunity to review and comment thereon, and the Company will make
such changes and additions thereto as reasonably requested by Investor (and the
underwriter(s), if any) prior to filing any Registration Statement or amendment
thereto or any Prospectus or any supplement thereto;

 

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(ii) prepare and file with the SEC 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 period of not less
than 90 days, in the case of a Demand Registration Statement or an aggregate of
eighteen (18) months, in the case of a Shelf Registration Statement (plus, in
each case, the duration of any Delay Period and any Blackout Period), or such
shorter period as is necessary to complete the distribution of the securities
covered by such Registration Statement 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 Investor thereof set forth in such Registration
Statement and, in the case of the Shelf Registration Statement, prepare such
prospectus supplements containing such disclosures as may be reasonably
requested by Investor or any underwriter(s) in connection with each shelf
takedown;
(iii) furnish to Investor such number of copies of such Registration Statement,
each amendment and supplement thereto, each Prospectus (including each
preliminary Prospectus and Prospectus supplement) and such other documents as
Investor and any underwriter(s) may reasonably request in order to facilitate
the disposition of the Registrable Common Stock, provided, however, that the
Company shall have no such obligation to furnish copies of a final prospectus if
the conditions of Rule 172(c) under the Securities Act are satisfied by the
Company;
(iv) use its reasonable best efforts to register or qualify such Registrable
Common Stock under such other securities or blue sky laws of such jurisdictions
(domestic or foreign) as Investor and any underwriter(s) reasonably requests and
do any and all other acts and things that may be reasonably necessary or
advisable to enable Investor and any underwriter(s) to consummate the
disposition in such jurisdictions of the Registrable Common Stock (provided,
that the Company will not be required to (1) qualify generally to do business in
any jurisdiction where it would not otherwise be required to qualify but for
this subparagraph (iv), (2) subject itself to taxation in any such jurisdiction
or (3) consent to general service of process in any such jurisdiction);
(v) notify Investor and any underwriter(s), at any time when a Prospectus
relating thereto is required to be delivered under the Securities Act, of the
occurrence of any event as a result of which any Prospectus contains an untrue
statement of a material fact or omits any material fact necessary to make the
statements therein not misleading, and, at the request of Investor or any
underwriter(s), the Company shall prepare a supplement or amendment to such
Prospectus so that, as thereafter supplemented and/or amended, such Prospectus
shall not contain an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not misleading;

 

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(vi) in the case of an underwritten offering, (i) enter into such customary
agreements (including underwriting agreements in customary form), (ii) take all
such other actions as Investor or the underwriter(s) reasonably request in order
to expedite or facilitate the disposition of such Registrable Common Stock
(including, without limitation, causing senior management and other Company
personnel to cooperate with Investor and the underwriter(s) in connection with
performing due diligence) and (iii) cause its counsel to issue opinions of
counsel in form, substance and scope as are customary in primary underwritten
offerings, addressed and delivered to the underwriter(s) and Investor;
(vii) in connection with each Demand Registration pursuant to Section 3 and each
Fully Marketed Underwritten Offering requested by Investor under Section 2,
cause there to occur Full Cooperation and, in all other cases, cause members of
senior management of the Company to be available to participate in, and to
cooperate with the underwriter(s) in connection with customary marketing
activities (including select conference calls and one-on-one meetings with
prospective purchasers);
(viii) make available for inspection by Investor, any underwriter participating
in any disposition pursuant to a Registration Statement, and any attorney,
accountant or other agent retained by Investor or underwriter, all pertinent
financial and other records, pertinent corporate documents and properties of the
Company, and cause the Company’s officers, directors, employees and independent
accountants to supply all information reasonably requested by Investor, any
underwriter, any attorney, any accountant or any agent in connection with such
Registration Statement;
(ix) use its reasonable best efforts to cause all such Registrable Common Stock
to be listed on NASDAQ, or any exchange on which securities of the same class
issued by the Company are then listed or, if no such similar securities are then
listed, on a national securities exchange selected by the Company and agreed to
by Investor;
(x) provide a transfer agent and registrar for all such Registrable Common Stock
not later than the effective date of such Registration Statement;

 

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(xi) if requested, cause to be delivered, immediately prior to the pricing of
any underwritten offering, immediately prior to effectiveness of each
Registration Statement (and, in the case of an underwritten offering, at the
time of closing of the sale of Registrable Common Stock pursuant thereto),
letters from the Company’s independent registered public accountants addressed
to Investor and each underwriter, if any, stating that such accountants are
independent public accountants within the meaning of the Securities Act and the
applicable rules and regulations adopted by the SEC thereunder, and otherwise in
customary form and covering such financial and accounting matters as are
customarily covered by letters of the independent registered public accountants
delivered in connection with primary underwritten public offerings;
(xii) make generally available to Investor and its Affiliates a consolidated
earnings statement (which need not be audited) for the 12 months beginning after
the effective date of a Registration Statement as soon as reasonably practicable
after the end of such period, which earnings statement shall satisfy the
requirements of an earning statement under Section 11(a) of the Securities Act;
and
(xiii) promptly notify Investor and the underwriter or underwriters, if any:
(1) when the Registration Statement, any pre-effective amendment, the Prospectus
or any Prospectus supplement or post-effective amendment to the Registration
Statement has been filed and, with respect to the Registration Statement or any
post-effective amendment, when the same has become effective;
(2) of any written request by the SEC for amendments or supplements to the
Registration Statement or any Prospectus or of any inquiry by the SEC relating
to the Registration Statement or the Company’s status as a well-known seasoned
issuer;
(3) of the notification to the Company by the SEC of its initiation of any
proceeding with respect to the issuance by the SEC of any stop order suspending
the effectiveness of the Registration Statement; and
(4) of the receipt by the Company of any notification with respect to the
suspension of the qualification of any Registrable Common Stock for sale under
the applicable securities or blue sky laws of any jurisdiction.

 

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(b) The Company represents and warrants that no Registration Statement
(including any amendments or supplements thereto and Prospectuses contained
therein) shall contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein, or necessary to make the
statements therein not misleading (except that the Company makes no
representation or warranty with respect to information relating to Investor
furnished to the Company by or on behalf of Investor specifically for use
therein).
(c) The Company shall make available to Investor (i) promptly after the same is
prepared and publicly distributed, filed with the SEC, or received by the
Company, one copy of each Registration Statement and any amendment thereto, each
preliminary Prospectus and Prospectus and each amendment or supplement thereto,
each letter written by or on behalf of the Company to the SEC or the staff of
the SEC (or other governmental agency or self-regulatory body or other body
having jurisdiction, including any domestic or foreign securities exchange), and
each item of correspondence from the SEC or the staff of the SEC (or other
governmental agency or self-regulatory body or other body having jurisdiction,
including any domestic or foreign securities exchange), in each case relating to
such Registration Statement or to any of the documents incorporated by reference
therein, and (ii) such number of copies of each Prospectus, including a
preliminary Prospectus, and all amendments and supplements thereto and such
other documents as Investor or any underwriter may reasonably request in order
to facilitate the disposition of the Registrable Common Stock. The Company will
promptly notify Investor of the effectiveness of each Registration Statement or
any post-effective amendment or the filing of any supplement or amendment to
such Shelf Registration Statement or of any Prospectus supplement. The Company
will promptly respond to any and all comments received from the SEC, with a view
towards causing each Registration Statement or any amendment thereto to be
declared effective by the SEC as soon as practicable and shall file an
acceleration request, if necessary, as soon as practicable following the
resolution or clearance of all SEC comments or, if applicable, following
notification by the SEC that any such Registration Statement or any amendment
thereto will not be subject to review.
(d) The Company may require Investor to furnish to the Company any other
information regarding Investor and the distribution of such securities as the
Company reasonably determines, based on the advice of counsel, is required to be
included in any Registration Statement.

 

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(e) Investor agrees that, upon notice from the Company of the happening of any
event as a result of which the Prospectus included (or deemed included) in such
Registration Statement contains an untrue statement of a material fact or omits
any material fact necessary to make the statements therein not misleading (a
“Suspension Notice”), Investor will forthwith discontinue disposition of
Registrable Common Stock pursuant to such Registration Statement for a
reasonable length of time not to exceed 10 days (45 days in the case of an event
described in Section 3(d)) until Investor is advised in writing by the Company
that the use of the Prospectus may be resumed and is furnished with a
supplemented or amended Prospectus as contemplated by Section 8(a) hereof;
provided, however, that such postponement of sales of Registrable Common Stock
by Investor shall not exceed ninety (90) days in the aggregate in any 12 month
period. If the Company shall give Investor any Suspension Notice, the Company
shall extend the period of time during which the Company is required to maintain
the applicable Registration Statements effective pursuant to this Agreement by
the number of days during the period from and including the date of the giving
of such Suspension Notice to and including the date Investor either is advised
by the Company that the use of the Prospectus may be resumed or receives the
copies of the supplemented or amended Prospectus contemplated by Section 8(a) (a
“Blackout Period”). In any event, the Company shall not be entitled to deliver
more than a total of three (3) Suspension Notices or notices of any Delay Period
in any twelve (12)-month period.
(f) The Company shall not permit any officer, director, underwriter, broker or
any other person acting on behalf of the Company to use any free writing
prospectus (as defined in Rule 405 under the Securities Act) in connection with
any registration statement covering Registrable Common Stock, without the prior
written consent of Investor and any underwriter.
9. Registration Expenses.
(a) All expenses incident to the Company’s performance of or compliance with
this Agreement, including, without limitation, all registration and filing fees
(including SEC registration fees and FINRA filing fees), fees and expenses of
compliance with securities or blue sky laws, listing application fees, printing
expenses, transfer agent’s and registrar’s fees, cost of distributing
Prospectuses in preliminary and final form as well as any supplements thereto,
and fees and disbursements of counsel for the Company and all accountants and
other Persons retained by the Company (all such expenses being herein called
“Registration Expenses”) (but not including any underwriting discounts or
commissions or transfer taxes, if any, attributable to the sale of Registrable
Common Stock), shall be borne by the Company. In addition, the Company shall pay
its internal expenses (including, without limitation, all salaries and expenses
of its officers and employees performing legal or accounting duties), the
expense of any annual audit or quarterly review, the expense of any liability
insurance and the expenses and fees for listing the securities to be registered
on each securities exchange on which they are to be listed.
(b) The Company shall pay, or shall reimburse Investor for, the reasonable fees
and disbursements of one law firm chosen by Investor as its counsel in
connection with each Registration Statement and sale of Registrable Common Stock
pursuant thereto.
(c) The obligation of the Company to bear the expenses described in Section 9(a)
and to pay or reimburse Investor for the expenses described in Section 9(b)
shall apply irrespective of whether any sales of Registrable Common Stock
ultimately take place.

 

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10. Indemnification.
(a) The Company shall indemnify, to the fullest extent permitted by law,
Investor and its officers, directors, employees and Affiliates and each Person
who controls Investor (within the meaning of the Securities Act) against all
losses, claims, damages, liabilities and expenses arising out of or based upon
any untrue or alleged untrue statement of material fact contained in any
Registration Statement, Prospectus, preliminary Prospectus or any “issuer free
writing prospectus” (as defined in Securities Act Rule 433) 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 or any violation or alleged violation by the Company of the
Securities Act, the Exchange Act or applicable “blue sky” laws, except insofar
as the same are made in reliance and in conformity with information relating to
Investor furnished in writing to the Company by Investor expressly for use
therein. In connection with an underwritten offering, the Company shall
indemnify such underwriter(s), their officers, employees and directors and each
Person who controls such underwriter(s) (within the meaning of the Securities
Act) at least to the same extent as provided above with respect to the
indemnification of Investor.
(b) In connection with any Registration Statement in which Investor is
participating, Investor shall furnish to the Company in writing such information
as the Company reasonably determines, based on the advice of counsel, is
required to be included in any such Registration Statement or Prospectus and
shall indemnify, to the fullest extent permitted by law, the Company, its
officers, employees, directors, Affiliates, and each Person who controls the
Company (within the meaning of the Securities Act) against all losses, claims,
damages, liabilities and expenses arising out of or based upon 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 the same are made in reliance and in
conformity with information relating to Investor furnished in writing to the
Company by Investor expressly for use therein.
(c) Any Person entitled to indemnification hereunder shall (i) give prompt
written notice to the indemnifying party of any claim with respect to which it
seeks indemnification and (ii) unless in such indemnified party’s reasonable
judgment a conflict of interest between such indemnified and indemnifying
parties may exist with respect to such claim, permit such indemnifying party to
assume the defense of such claim with counsel reasonably satisfactory to the
indemnified party. If such defense is assumed, the indemnifying party shall not
be subject to any liability for any settlement made by the indemnified party
without its consent (but such consent will not be unreasonably withheld). An
indemnifying party who is not entitled to, or elects not to, assume the defense
of a claim shall not be obligated to pay the fees and expenses of more than one
counsel (in addition to any local counsel) for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party there may be one or more legal or equitable defenses
available to such indemnified party that are in addition to or may conflict with
those available to another indemnified party with respect to such claim. Failure
to give prompt written notice shall not release the indemnifying party from its
obligations hereunder.

 

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(d) 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 party or any officer, director or controlling Person of such
indemnified party and shall survive the transfer of securities.
(e) If the indemnification provided for in or pursuant to this Section 10 is due
in accordance with the terms hereof, but is held by a court to be unavailable or
unenforceable in respect of any losses, claims, damages, liabilities or expenses
referred to herein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified Person as a result of such losses, claims, damages,
liabilities or expenses in such proportion as is appropriate to reflect the
relative fault of the indemnifying party on the one hand and of the indemnified
party on the other in connection with the statements or omissions that result in
such losses, claims, damages, liabilities or expenses as well as any other
relevant equitable considerations. The relative fault of the indemnifying party
on the one hand and of the indemnified party on the other 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 indemnifying party or by the indemnified
party, and by such party’s relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. In no event shall
the liability of Investor be greater in amount than the amount of net proceeds
received by Investor upon such sale.
11. Rule 144.
The Company covenants that it will file the reports required to be filed by it
under the Securities Act and the Exchange Act and the rules and regulations
adopted by the SEC thereunder, and it will take such further action as Investor
may reasonably request to make available adequate current public information
with respect to the Company meeting the current public information requirements
of Rule 144(c) under the Securities Act, to the extent required to enable
Investor to sell Registrable Common Stock 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, or
(ii) any similar rule or regulation hereafter adopted by the SEC. Upon the
request of Investor, the Company will deliver to Investor a written statement as
to whether it has complied with such information and requirements.

 

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12. Transfer of Registration Rights.
(a) Investor may transfer all or any portion of its then-remaining rights under
this Agreement to any transferee who acquires at least ten percent (10%) of the
Stock Consideration (each, a “transferee”); provided, however, that the rights
of the Investor to registration of Registrable Common Stock pursuant to this
Agreement may be assigned to any Permitted Transferee of the Investor to which
there is transferred to such Permitted Transferee any Registrable Common Stock,
regardless of amount. Any transfer of registration rights pursuant to this
Section 12 shall be effective upon receipt by the Company of (x) written notice
from Investor stating the name and address of any transferee and identifying the
amount of Registrable Common Stock with respect to which the rights under this
Agreement are being transferred and the nature of the rights so transferred and
(y) a written agreement from the transferee to be bound by all of the terms of
this Agreement. In connection with any such transfer, the term “Investor” as
used in this Agreement shall, where appropriate to assign such rights to such
transferee, be deemed to refer to the transferee holder of such Registrable
Common Stock. Investor and such transferees may exercise the registration rights
hereunder in such proportion (not to exceed the then-remaining rights hereunder)
as they shall agree among themselves.
(b) After such transfer, Investor shall retain its rights under this Agreement
with respect to all other Registrable Common Stock owned by Investor. Upon the
request of Investor, the Company shall execute a Registration Rights Agreement
with such transferee or a proposed transferee substantially similar to the
applicable sections of this Agreement.
13. Conversion or Exchange of Other Securities.
If Investor offers Registrable Common Stock by forward sale, or any options,
rights, warrants or other securities issued by it or any other person that are
offered with, convertible into or exercisable or exchangeable for any
Registrable Common Stock, the Registrable Common Stock subject to such forward
sale or underlying such options, rights, warrants or other securities shall be
eligible for registration pursuant to Sections 2, 3 and 4 of this Agreement.

 

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14. Miscellaneous.
(a) Notices. All notices, requests, consents and other communications required
or permitted hereunder shall be in writing and shall be hand delivered or mailed
postage prepaid by registered or certified mail or by facsimile transmission
(with immediate telephone confirmation thereafter) and, in the case of Investor,
shall also be sent via e-mail,

     
(a)
  If to Investor to it at:
 
   
 
  PNBK Holdings LLC
 
  885 Third Avenue, 28th Floor
 
  New York, NY 10022
 
  Attn: Michael A. Carrazza
 
  Telephone: (212) 451-2900
 
  Fax: (212) 451-2999
 
    with copies to (which copies alone shall not constitute notice):
 
   
 
  Skadden, Arps, Slate, Meagher & Flom LLP
 
  Four Times Square
 
  New York, New York 10036
 
  Attn: David C. Ingles
 
  Telephone: (212) 735-3000

 
  Fax: (212) 735-2000
 
   
 
  and
 
   
 
  Robinson & Cole LLP
 
  1055 Washington Boulevard
 
  Stamford, CT 06901-2249
 
  Attn: Eric J. Dale
 
  Telephone: (203) 462-7500
 
  Fax: (203) 462-7599

 

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(b)
  If to the Company:
 
   
 
  Patriot National Bancorp, Inc.
 
  900 Bedford Street
 
  Stamford, CT 06901
 
  Attn: Chairman of the Board
 
  Telephone: (203) 324-7500
 
  Fax: (203) 316-2982
 
    with copies to (which copies alone shall not constitute notice):
 
   
 
  Hinckley, Allen & Snyder LLP
 
  20 Church Street
 
  Hartford, CT 06103
 
  Attn: William W. Bouton III
 
            Sarah M. Lombard
 
  Telephone: (714) 371-2500

 
  Fax: (714) 371-2550

or at such other address as such party each may specify by written notice to the
others, and each such notice, request, consent and other communication shall for
all purposes of the Agreement be treated as being effective or having been given
when delivered personally, upon one business day after being deposited with a
courier if delivered by courier, upon receipt of facsimile confirmation if
transmitted by facsimile, or, if sent by mail, at the earlier of its receipt or
72 hours after the same has been deposited in a regularly maintained receptacle
for the deposit of United States mail, addressed and postage prepaid as
aforesaid.
(b) No Waivers. No failure or delay by any party in exercising any right, power
or privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
(c) Successors and Assigns. The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. If the outstanding Common Stock is converted into or
exchanged or substituted for other securities issued by any other Person, as a
condition to the effectiveness of the merger, consolidation, reclassification,
share exchange or other transaction pursuant to which such conversion, exchange,
substitution or other transaction takes place, such other Person shall
automatically become bound hereby with respect to such other securities
constituting Registrable Common Stock and, if requested by Investor or a
permitted transferee, shall further evidence such obligation by executing and
delivering to Investor and such transferee a written agreement to such effect in
form and substance satisfactory to Investor.
(d) Governing Law. The internal laws, and not the laws of conflicts (other than
Section 5-1401 of the General Obligations Law of the State of New York), of New
York shall govern the enforceability and validity of this Agreement, the
construction of its terms and the interpretation of the rights and duties of the
parties.

 

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(e) Jurisdiction. Any suit, action or proceeding seeking to enforce any
provision of, or based on any matter arising out of or in connection with, this
Agreement or the transactions contemplated hereby may be brought in any federal
or state court located in the County and State of New York, and each of the
parties hereby consents to the jurisdiction of such courts (and of the
appropriate appellate courts therefrom) in any such suit, action or proceeding
and irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding in any such court or that any such suit, action or
proceeding which is brought in any such court has been brought in an
inconvenient forum. Process in any such suit, action or proceeding may be served
on any party anywhere in the world, whether within or without the jurisdiction
of any such court. Without limiting the foregoing, each party agrees that
service of process on such party as provided in Section 14(a) shall be deemed
effective service of process on such party.
(f) Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
(g) Counterparts; Effectiveness. This Agreement may be executed in any number of
counterparts (including by facsimile) and by different parties hereto in
separate counterparts, with the same effect as if all parties had signed the
same document. All such counterparts shall be deemed an original, shall be
construed together and shall constitute one and the same instrument. This
Agreement shall become effective when each party hereto shall have received
counterparts hereof signed by all of the other parties hereto.
(h) Entire Agreement. This Agreement contains the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes and
replaces all other prior agreements, written or oral, among the parties hereto
with respect to the subject matter hereof.
(i) Captions. The headings and other captions in this Agreement are for
convenience and reference only and shall not be used in interpreting, construing
or enforcing any provision of this Agreement.
(j) Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner materially adverse to any party. Upon such a
determination, the parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner in order that the transactions contemplated
hereby be consummated as originally contemplated to the fullest extent possible.

 

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(k) Amendments. The provisions of this Agreement, including the provisions of
this sentence, may not be amended, modified or supplemented, and waivers or
consents to or departures from the provisions hereof may not be given, without
the written consent of the Company and Investor.
(l) Aggregation of Stock. All Registrable Common Stock held by or acquired by
any Affiliated Persons will be aggregated together for the purpose of
determining the availability of any rights under this Agreement.
(m) Equitable Relief. The parties hereto agree that legal remedies may be
inadequate to enforce the provisions of this Agreement and that equitable
relief, including specific performance and injunctive relief, may be used to
enforce the provisions of this Agreement.

 

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IN WITNESS WHEREOF, this Registration Rights Agreement has been duly executed
and delivered by the duly authorized officers of the parties hereto as of the
date first herein above written.

            PATRIOT NATIONAL BANCORP, INC.
      By:   /s/ Angelo De Caro         Name:   Angelo De Caro        Title:  
CEO        PNBK HOLDINGS LLC
      By:   PNBK SPONSOR LLC,         its Managing Member

    By:   /s/ Michael A. Carrazza         Name:   Michael A. Carrazza       
Title:   Manager   

[Signature Page to Registration Rights Agreement]