Exhibit 10.3

 

REGISTRATION RIGHTS AGREEMENT

 

REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of July 27, 2016, by
and between JERNIGAN CAPITAL, INC., a Delaware corporation (the “Company”), and
certain funds managed or advised by Highland Capital Management, L.P. or its
controlled affiliates (“Highland”) and identified on the signature page(s)
hereto (each, a “Buyer” and collectively, together with their permitted
transferees and assigns, the “Buyers”). Capitalized terms used herein and not
otherwise defined herein shall have the respective meanings set forth in the
Stock Purchase Agreement dated as of the date hereof (as amended, restated,
supplemented or otherwise modified from time to time, the “Stock Purchase
Agreement”).

 

RECITALS:

 

A.           Upon the terms and subject to the conditions of the Stock Purchase
Agreement, the Company has agreed to issue to the Buyers and the Buyers have
agreed to purchase shares of the Company’s Series A Preferred Stock, par value
$0.01 per share (the “Series A Preferred Stock”), pursuant to Section 1 of the
Stock Purchase Agreement;

 

B.           In connection with the sale and purchase of the Series A Preferred
Stock, the Company may issue to the Buyers shares of the Company’s common stock,
par value $0.01 per share (the “Common Stock”), as dividends in respect of the
Company’s Series A Preferred Stock; and

 

C.           To induce the Buyers to enter into the Stock Purchase Agreement,
the Company has agreed to provide certain registration rights under the
Securities Act of 1933, as amended, and the rules and regulations there under,
or any similar successor statute (collectively, the “Securities Act”), and
applicable state securities laws.

 

NOW, THEREFORE, in consideration of the promises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Buyer hereby
agree as follows:

 

ARTICLE I
DEFINITIONS

 

The following terms, as used herein, have the following meanings:

 

“Agreement” has the meaning set forth in the preamble.

 

“Board of Directors” means the Board of Directors of the Company.

 

“Business Day” means any day on which the Principal Market is open for trading
during normal trading hours (i.e., 9:30 a.m. to 4:00 p.m. Eastern Time),
including any day on which the Principal Market is open for trading for a period
of time less than the customary time.

 

“Buyers” has the meaning set forth in the preamble.

 

“Commission” means the U.S. Securities and Exchange Commission.

 

“Common Stock” has the meaning set forth in the recitals.

 

 

 

 

“Company” has the meaning set forth in the preamble.

 

“Effectiveness Date” has the meaning set forth in Section 2.1(a).

 

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated by the Commission thereunder.

 

“FINRA” has the meaning set forth in Section 3.1(k).

 

“Holder” means any Initial Holder and any direct or indirect transferee of any
Registrable Securities.

 

“Holders’ Counsel” means one counsel for the Holders that is selected by the
Holders holding a majority of the Registrable Securities included in the Shelf
Registration Statement, with such selection being effective by written consent
of Holders holding a majority of the Registrable Securities, whether record or
beneficial Holders.

 

“Indemnified Party” has the meaning set forth in Section 4.2.

 

“Indemnifying Party” has the meaning set forth in Section 4.2.

 

“Initial Holder” means the Buyers in any purchase pursuant to the Stock Purchase
Agreement.

 

“Initial Holder Representative” means NexPoint Advisors, L.P.

 

“Initiating Holder” has the meaning set forth in Section 2.2(a).

 

“Inspectors” has the meaning set forth in Section 3.1(i).

 

“Marketed Underwritten Offering” has the meaning set forth in Section 2.2(b).

 

“Marketed Underwritten Offering Notice” has the meaning set forth in Section
2.2(b).

 

“Person” means any individual or entity including any limited liability company,
a partnership, a joint venture, a corporation, a trust, an unincorporated
organization and a government or any department or agency thereof.

 

“Principal Market” means the New York Stock Exchange; provided, however, that in
the event the Company’s Common Stock is ever primarily traded on the Nasdaq
Stock Market, the OTC Bulletin Board, or another nationally recognized market or
exchange, then the “Principal Market” shall mean such other market or exchange
on which the Company’s Common Stock is then primarily listed or traded.

 

“Records” has the meaning set forth in Section 3.1(i).

 

 2 

 

 

“Registrable Securities” means (1) all shares of Common Stock owned by the
Initial Holders, whether owned at the time of the execution of this Agreement or
acquired after the date of this Agreement, (2) any shares of Common Stock that
Holders receive as dividends on the Company’s Common Stock or Series A Preferred
Stock, and (3) any shares of Common Stock owned by a Holder that was issued or
is issuable with respect to the Series A Preferred Stock or the Common Stock by
way of exchange, stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise. As to any particular Registrable Securities, such
Registrable Securities shall only cease to be Registrable Securities when (a) a
registration statement with respect to the sale of such securities has been
declared effective by the Commission and such particular Registrable Securities
have been disposed of under such registration statement, (b) such time as such
particular Registrable Securities have been otherwise transferred to holders who
may trade such shares without restriction under the Securities Act, and the
Company has delivered a new certificate or other evidence of ownership for such
securities not bearing a restrictive legend, or (c) such particular Registrable
Securities are eligible to be sold at one time under the exemption of Rule 144
free of all limitations of such rule.

 

“Registration Default” has the meaning set forth in Section 2.1(e).

 

“Registration Expenses” has the meaning set forth in Section 3.2.

 

“Rule 144” means Rule 144 (or any successor rule of similar effect) promulgated
under the Securities Act.

 

“Rule 415” means Rule 415 (or any successor rule of similar effect) promulgated
under the Securities Act.

 

“Securities Act” has the meaning set forth in the recitals.

 

“Selling Expenses” means all underwriting discounts, selling commissions and
stock transfer taxes applicable to the sale of Registrable Securities.

 

“Selling Holder” means any Holder whose Registrable Securities are entitled to
be registered for resale pursuant to the terms hereof.

 

“Series A Preferred Stock” has the meaning set forth in the recitals.

 

“Shelf Filing Date” has the meaning set forth in Section 2.1(a).

 

“Shelf Registration Period” has the meaning set forth in Section 2.1(b).

 

“Shelf Registration Statement” has the meaning set forth in Section 2.1(a).

 

“Stock Purchase Agreement” has the meaning set forth in the recitals.

 

“Successor” has the meaning set forth in Section 5.9.

 

“Underwritten Offering Notice” has the meaning assigned to it in Section 2.2(a).

 

“Underwriter” means a securities dealer who purchases any Registrable Securities
or other securities of the Company as principal for the resale of such
securities and not as part of such dealer’s market making activities.

 

“Underwriters’ Counsel” means one counsel for the Underwriter(s), selected in
accordance with the terms of this Agreement, of an Underwritten Offering.

 

“Underwritten Offering” means any sale of Common Stock to an Underwriter(s) on a
firm commitment basis.

 

 3 

 

 

ARTICLE II
REGISTRATION RIGHTS

 

Section 2.1           Shelf Registration.

 

(a)          Subject to Sections 2.1(c), (d) and (e) hereof, the Company shall
(i) use commercially reasonable efforts to prepare and file with the Commission,
as soon as reasonably possible following the date of this Agreement but in no
event later than 60 days following the date of this Agreement unless the Initial
Holder Representative shall on behalf of the Initial Holders in writing
designate a later date (the “Shelf Filing Date”), a registration statement (such
registration statement, including any replacement registration statement, the
“Shelf Registration Statement”) with respect to the resale of the Registrable
Securities under the Securities Act on Form S-3 (or any similar or successor
form or other form to the extent that Form S-3 is not available), which Shelf
Registration Statement (A) shall provide for the registration and the sale by
the Holders of the Registrable Securities on a continuous or delayed basis
pursuant to Rule 415, (B) 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 Commission to be filed
therewith or be incorporated therein and (C) shall be reasonably acceptable to
the Holders’ Counsel, and (ii) use its commercially reasonable efforts to cause
such Shelf Registration Statement to be declared effective by the Commission as
soon as practicable thereafter but in no event later than 180 days after filing
(the “Effectiveness Date”). The Shelf Registration Statement shall provide for
the resale of the Registrable Securities pursuant to any method or combination
of methods legally available by the Holders, and the Shelf Registration
Statement and any form of prospectus included or incorporated by reference
therein (or any prospectus supplement relating thereto) shall reflect such plan
of distribution or methods of sale.

 

(b)          Subject to Sections 2.1(c), (d) and (e), the Company shall use
commercially reasonable efforts to keep the Shelf Registration Statement
continuously effective for the period beginning on the Effectiveness Date and
ending on the date that all of the Registrable Securities registered under the
Shelf Registration Statement cease to be Registrable Securities (the “Shelf
Registration Period”). During the Shelf Registration Period, the Company shall
(i) subject to Section 2.1(c) hereof, prepare and file with the Commission such
supplements, amendments and/or post-effective amendments to the Shelf
Registration Statement as may be (A) necessary to keep the Shelf Registration
Statement continuously effective for the Shelf Registration Period or
(B) reasonably requested by the Holders (whether or not required by the form on
which the securities are being registered), including, without limitation, to
identify additional Holders in such Shelf Registration Statement or to register
additional Registrable Securities under such Self Registration Statement, and
shall use commercially reasonable efforts to cause each such supplement,
amendment and/or post-effective amendment to be declared effective by the
Commission, if required, as soon as practicable after the filing thereof,
(ii) subject to Section 2.1(c) hereof, use commercially reasonable efforts to
cause any related prospectus to be supplemented by any required supplement, and
as so supplemented to be filed with the Commission pursuant to Rule 424 under
the Securities Act (or any similar provisions then in force under the Securities
Act), to the extent required, and (iii) comply in all material respects with the
provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by the Shelf Registration Statement during the
Shelf Registration Period in accordance with the intended methods of disposition
in market transactions as may be reasonably requested from time to time by the
Holders and set forth in such Shelf Registration Statement as so amended or
supplemented or such prospectus as so supplemented.

 

 4 

 

 

(c)          If a majority of the Board of Directors determines in its good
faith judgment that the availability of the Shelf Registration Statement or the
use of any related prospectus or prospectus supplement would require the
disclosure of material information that the Company has a bona fide business
purpose for preserving as confidential or the disclosure of which would impede
the Company’s ability to consummate a material transaction (which may include an
offering of the Company’s securities by the Company), and that the Company is
not otherwise required by applicable securities laws or regulations to disclose,
upon written notice from the Company of such determination by the Board of
Directors, the rights of the Holders to offer, sell or distribute any
Registrable Securities pursuant to the Shelf Registration Statement or to
require the Company to take action with respect to the registration or sale of
any Registrable Securities pursuant to the Shelf Registration Statement,
including with respect to an Underwritten Offering, shall be suspended until the
earlier of (i) the date upon which the Company notifies the Holders in writing
that suspension of such rights for the grounds set forth in this Section 2.1(c)
is no longer necessary and the Holders have received copies of any required
amendment or supplement to the relevant prospectus, and (ii) 45 days following
receipt of such written notice from the Company. The Company agrees to give such
notice as promptly as reasonably practicable following the date that such
suspension of rights is no longer necessary.

 

(d)          The Company may not utilize the suspension rights under Section
2.1(c) more than one time in any three-month period nor more than two times in
any 12-month period. Each Holder agrees by acquisition of the Registrable
Securities that upon receipt of any suspension notice provided for under Section
2.1(c), such Holder will discontinue its disposition of Registrable Securities
pursuant to the Shelf Registration Statement relating to such Registrable
Securities until the expiration of the applicable suspension period as provided
in Section 2.1(c).

 

(e)          If (i) the Shelf Registration Statement has not been filed with the
Commission by the Shelf Filing Date, (ii) the Shelf Registration Statement has
not been declared effective by the Commission by Effectiveness Date, or (iii) to
the extent that Registrable Securities remain outstanding, the Shelf
Registration Statement is filed and declared effective but shall thereafter
cease to be effective (without being succeeded by a replacement shelf
registration statement which is filed and declared effective) or usable
(including as a result of any suspension period under Section 2.1(c) hereof) for
the offer and sale of such Registrable Securities for any period of time
(including any suspension period under Section 2.1(c) hereof) which shall exceed
30 consecutive Business Days or for more than an aggregate of 90 Business Days
in any 365-day period, which is not in connection with a post-effective
amendment to such Shelf Registration Statement required in the business judgment
of the majority of the Board of Directors arrived at in good faith, provided
that, in connection with any post-effective amendment to such Shelf Registration
Statement that is required to be declared effective by the Commission, such
lapse or unavailability may continue for a period of no more than 30 consecutive
Business Days, which such period shall be extended for an additional 30 Business
Days if the Company receives a comment letter from the Commission in connection
therewith (each such event referred to in the immediately preceding clauses (i),
(ii) and (iii), a “Registration Default”). THE PARTIES ACKNOWLEDGE THAT THE
REMEDIES PROVIDED FOR IN THE ARTICLES SUPPLEMENTARY TO THE COMPANY’S ARTICLES OF
AMENDMENT AND RESTATEMENT FOR A FAILURE TO FILE THE REGISTRATION STATEMENT OR A
FAILURE TO HAVE THE SHELF REGISTRATION STATEMENT DECLARED OR REMAIN EFFECTIVE
ARE DIFFICULT TO MEASURE AND THAT SUCH REMEDIES PROVIDED FOR THEREIN ARE
REASONABLE LIQUIDATED DAMAGES AND NOT A PENALTY. Promptly (but in no event more
than five Business Days) after the occurrence of a Registration Default, the
Company shall give the Holders at such time written notice of such occurrence.

 

 5 

 

 

Section 2.2           Underwritten Shelf Take-Downs.

 

(a)          At any time during which the Company has an effective Shelf
Registration Statement with respect to the Registrable Securities, by written
notice to the Company specifying the intended method or methods of disposition
thereof (an “Underwritten Offering Notice”), one or more Selling Holder(s)
beneficially owning at least an aggregate of 5% of the Registrable Securities
(each an “Initiating Holder”) may request an Underwritten Offering of
Registrable Securities pursuant to such Shelf Registration Statement, and the
Company shall use its commercially reasonable efforts to amend or supplement the
applicable Shelf Registration Statement, if necessary, for such purpose as soon
as practicable; provided, however, that (i) any Underwritten Offering Notice
shall be required to be in respect of at least $15 million in anticipated net
proceeds in the aggregate and (ii) in no event shall the Company be required to
effect (a) more than one Underwritten Offering during any consecutive
90-calendar day period,(b) more than two Underwritten Offerings during any
rolling twelve-month period and (c) more than six Marketed Underwritten
Offerings under this Section 2.2.  Subject to Section 2.2(b)(ii) below, such
Initiating Holders shall have the right to select the managing Underwriter(s) to
administer such offering, which managing Underwriter(s) shall be reasonably
acceptable to the Company.

 

(b)          If any Underwritten Offering Notice requests a customary “road
show” (including an “electronic road show”) or other marketing effort by the
Company and the Underwriters over a period expected to exceed 48 hours (a
“Marketed Underwritten Offering”), promptly upon delivery of such Underwritten
Offering Notice (but in no event more than three (3) Business Days thereafter),
the Company shall promptly deliver a written notice (a “Marketed Underwritten
Offering Notice”) of such Marketed Underwritten Offering to all Selling Holders
(other than the Initiating Holders), and the Company shall include in such
Marketed Underwritten Offering all such Registrable Securities of such Selling
Holders that are registered on the Shelf Registration Statement for which the
Company has received written requests, which requests must specify the aggregate
amount of such Registrable Securities of such Selling Holders requested to be
offered and sold pursuant to such Marketed Underwritten Offering, for inclusion
therein within 5 Business Days after the date that such Marketed Underwritten
Offering Notice has been delivered; provided, that if the managing
Underwriter(s) of any proposed Marketed Underwritten Offering informs the
Selling Holders that have requested to participate in such Marketed Underwritten
Offering in writing that, in its or their good-faith opinion, the number of
Registrable Securities which such Selling Holders intend to include in such
Marketed Underwritten Offering exceeds the number of Registrable Securities
which can be sold in such offering without being likely to have a significant
adverse effect on the price, timing or distribution of the securities offered or
the market for the securities offered, then the Registrable Securities to be
included in such Marketed Underwritten Offering shall be the number of
Registrable Securities that, in the opinion of such managing Underwriter(s), can
be sold without having such adverse effect in such Marketed Underwritten
Offering, which number shall be allocated (i) first, to the Registrable
Securities requested to be included in such Marketed Underwritten Offering by
the Initiating Holders and (ii) second, to the Registrable Securities requested
to be included in such Marketed Underwritten Offering by any Selling Holder who
is not one of the Initiating Holders on a pro rata basis.  The Holders of a
majority of the Registrable Securities to be included in any Marketed
Underwritten Offering shall have the right to select the managing Underwriter(s)
to administer such offering, which managing Underwriter(s) shall be reasonably
acceptable to the Company. No holder of securities of the Company shall be
permitted to include such holder’s securities in any Marketed Underwritten
Offering except for Holders who wish to include Registrable Securities pursuant
to this Section 2.2(b)(ii). Notwithstanding anything herein to the contrary, if
an Underwritten Offering Notice does not expressly specify that the Underwritten
Offering shall include a customary road show or other substantial marketing
efforts over a period expected to exceed 48 hours, the Company shall have no
obligation to deliver a Marketed Underwritten Offering Notice to Holders.

 

 6 

 

 

(c)          Notwithstanding anything to the contrary herein, the Company shall
not be obligated to effect, or take any action to effect, an Underwritten
Offering during any customary lock-up period required by the underwriters in
connection with any prior primary underwritten public offering of securities of
the Company for its own account (a “Company Underwritten Offering”) or
(ii) during the period commencing on the date that is thirty (30) days prior to
the Company’s good faith estimate of the date of filing of a registration
statement, prospectus or prospectus supplement relating to a Company
Underwritten Offering and ending on the date that is sixty (60) days after the
filing of a final prospectus with respect to a Company Underwritten Offering
(the “Black-Out Period”). Promptly upon the commencement of any Black-Out
Period, the Company shall deliver a notice of the institution thereof (a
“Black-Out Notice”), which Black-Out Notice shall provide the reason(s) for
which a Black-Out Period has been instituted. Following the delivery of a
Black-Out Notice in accordance with this Section 2.2(c), the Company shall not
be obligated to effect the Underwritten Offering requested by such Underwritten
Offering Notice until the expiration of the Black-Out Period; provided, however,
that the Company shall notify the Initiating Holder promptly if it elects not to
pursue a Company Underwritten Offering, in which case the Holders shall no
longer be subject to the Black-Out Period and may immediately submit to the
Company a new Underwritten Offering Notice.

 

(d)          In the event of any Company Underwritten Offering, each Holder
hereby agrees that it shall not, to the extent requested by the Company or an
underwriter of securities of the Company, directly or indirectly sell, offer to
sell (including without limitation any short sale), grant any option or
otherwise transfer or dispose of any Registrable Securities (other than to
donees or affiliates of such Holder who agree to be similarly bound) for a
period of up to sixty (60) days following the date of any underwriting agreement
with respect to a Company Underwritten Offering; provided, however, that no
Holder shall be subject to the restrictions in this Section 2.2(d) unless (i)
all executive officers and directors of the Company enter into similar
agreements and (ii) any concession or proportionate release allowed to any
executive officer or director of the Company that entered into similar
agreements shall be afforded to the Holders.

 

ARTICLE III
REGISTRATION PROCEDURES

 

Section 3.1           Filings; Information. In connection with the registration
of Registrable Securities pursuant to Sections 2.1 and 2.2:

 

(a)          The Company will prepare and file with the Commission a Shelf
Registration Statement on Form S-3 or such other form that the Company is
eligible to use and which counsel for the Company shall deem appropriate and
available for the sale of the Registrable Securities to be registered thereunder
in accordance with the intended methods of distribution thereof, as may be
reasonably necessary to effect the sale of the Registrable Securities, including
in an Underwritten Offering. Before filing a Shelf Registration Statement,
prospectus or any free writing prospectus, or any amendments or supplements
thereto, the Company shall (x) furnish to the managing Underwriter(s), if any,
and the Holders participating in the Shelf Registration Statement or an
Underwritten Offering, as applicable, copies of all documents prepared to be
filed, and provide such managing Underwriter(s), if any, and such Holders and
their respective counsel with a reasonable opportunity to review and comment on
such documents prior to their filing and (y) not file any Shelf Registration
Statement or prospectus to which any such Underwriters or Holders, as
applicable, shall reasonably object. The Company may require Holders to furnish
in writing to the Company such information regarding such Holders and other
information as the Company may be legally required to disclose in connection
with such registration.

 

 7 

 

 

(b)          The Company shall, if requested, prior to filing a Shelf
Registration Statement or any amendment or supplement thereto, furnish to the
Selling Holders, and each applicable managing Underwriter, if any, copies
thereof, and thereafter furnish to the Selling Holders and each such
Underwriter, if any, such number of copies of such Shelf Registration Statement,
amendment and supplement thereto (in each case including all exhibits thereto
and documents incorporated by reference therein, unless such exhibits and
documents are available on the Commission’s Electronic Data Gathering and
Retrieval System) and the prospectus included in such Shelf Registration
Statement (including each prospectus, preliminary prospectus and prospectus
supplement, as applicable) as the Selling Holders or each such managing
Underwriter, if any, may reasonably request in order to facilitate the sale of
the Registrable Securities by the Selling Holders.

 

(c)          After the filing of the Shelf Registration Statement, the Company
will promptly notify the Selling Holders and the managing Underwriter(s), if
any, of any stop order issued or, to the Company’s knowledge, threatened to be
issued by the Commission and use its commercially reasonable efforts to prevent
the entry of such stop order or to remove it if entered.

 

(d)          In addition to the requirements imposed on the Company elsewhere
herein, the Company will qualify the Registrable Securities for offer and sale
under such other securities or “blue sky” laws of such jurisdictions in the
United States as any Selling Holder or managing Underwriter(s), if any, or their
respective counsel reasonably request in writing for the registration or
qualification of the Registrable Securities for sale; keep any such registration
or qualification (or exemption therefrom) effective during the period in which
such Shelf Registration Statement is required to be kept effective; and do any
and all other acts and things which may be necessary or advisable to enable each
Selling Holder to consummate the disposition of the Registrable Securities owned
by such Selling Holder in such jurisdictions; provided, however, that the
Company will not be required to (i) qualify to generally do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 3.1(d), (ii) subject itself to taxation in any such jurisdiction, or
(iii) consent to general service of process in any such jurisdiction where it is
not then subject.

 

(e)          The Company will as promptly as is reasonably practicable notify
the Selling Holders and the managing Underwriter(s), if any, at any time when a
prospectus relating to the sale of the Registrable Securities is required by law
to be delivered in connection with sales by an Underwriter or dealer, of the
occurrence of any event requiring the preparation of a supplement or amendment
to such prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain an untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading and promptly make available to the
Selling Holders and to the managing Underwriter(s), if any, any such supplement
or amendment. Upon receipt of any notice of the occurrence of any event of the
kind described in the preceding sentence, the Selling Holders will forthwith
discontinue the offer and sale of Registrable Securities pursuant to the Shelf
Registration Statement covering such Registrable Securities until receipt by the
Selling Holders and the managing Underwriter(s) of the copies of such
supplemented or amended prospectus and, if so directed by the Company, the
Selling Holders shall deliver to the Company all copies, other than permanent
file copies then in the possession of the Selling Holders, of the most recent
prospectus covering such Registrable Securities at the time of receipt of such
notice. Furthermore, in the event the Company shall give such notice, the
Company shall, as promptly as is reasonably practicable, subject to the
suspension rights under Sections 2.1(c), (d) and (e), if applicable, prepare a
supplement or post-effective amendment to the Shelf Registration Statement or a
supplement to the related prospectus or any document incorporated or deemed to
be incorporated therein by reference, and file any other required document so
that, as thereafter delivered to the purchasers of the Registrable Securities
being sold thereunder, such prospectus will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.

 

 8 

 

 

(f)          [Reserved]

 

(g)          [Reserved]

 

(h)          If requested by the managing Underwriter(s) or any Selling Holder,
the Company shall promptly incorporate in a prospectus supplement or
post-effective amendment such information as the managing Underwriter(s) or any
Selling Holder reasonably requests to be included therein, including without
limitation, with respect to the Registrable Securities being sold by such
Selling Holder, the purchase price being paid therefor by the Underwriters and
with respect to any other terms of the Underwritten Offering of the Registrable
Securities to be sold in such offering, and promptly make all required filings
of such prospectus supplement or post-effective amendment.

 

(i)          The Company shall promptly make available for inspection by Initial
Holder Representative, any other representative designated to act as a
representative of the Holders (other than the Initial Holders) (the “Additional
Representative”), or any representative of the Underwriter(s) participating in
any disposition of Registrable Securities pursuant to a Shelf Registration
Statement, Holders’ Counsel and Underwriters’ Counsel, and any accountant or
other agent or representative retained by or on behalf of the Initial Holders
(as representative of any such Initial Holder), the Additional Representative,
or the representative of such Underwriter(s) (collectively, the “Inspectors”),
all financial and other records, pertinent corporate documents and properties of
the Company (collectively, the “Records”), as shall reasonably be necessary to
enable them to exercise their due diligence responsibility (including the
conduct of a reasonable investigation within the meaning of Section 11 of the
Securities Act), and cause the Company’s officers, directors and employees to
supply all information requested by any such Inspector in connection with such
registration statement; provided, however, that unless the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in the
registration statement or the release of such Records is ordered pursuant to a
subpoena or other order from a court of competent jurisdiction, the Company
shall not be required to provide any information under this subparagraph (i) if
(A) the Company believes, after consultation with counsel for the Company, that
to do so would cause the Company to forfeit an attorney-client privilege that
was applicable to such information or (B) if the Company has requested and been
granted from the Commission confidential treatment of such information contained
in any filing with the Commission or documents provided supplementally or
otherwise.

 

(j)          The Company shall cause the Common Stock included in any Shelf
Registration Statement to be listed on each securities exchange, including,
without limitation, the Principal Market, on which securities issued by the
Company are then listed, if the Registrable Securities so qualify.

 

 9 

 

 

(k)          The Company shall cooperate with each Selling Holder, 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 Financial Industry Regulatory Authority (“FINRA”).

 

(l)          The Company shall, as may be reasonably requested in an
Underwritten Offering Notice, participate in any customary roadshow organized
for purposes of publicizing the sale or other disposition of the Registrable
Securities. Such participation shall include, but not be limited to, dispatch by
the Company of personnel, on a reasonable basis and subject to the operational
needs of the Company, to assist in each presentation during made such roadshow,
and provision of the Company data needed for purposes of the roadshow.

 

(m)          The Company shall, during the period when the prospectus is
required to be delivered under the Securities Act, use commercially reasonable
efforts to promptly file all documents required to be filed with the Commission
pursuant to Section 13(a) of the Exchange Act.

 

Section 3.2           Registration Expenses. In connection with any registration
effected hereunder, the Company shall pay all expenses incurred in connection
with such registration (the “Registration Expenses”), including without
limitation: (i) registration and filing fees with the Commission and FINRA,
(ii) all fees and expenses, if any, of compliance with securities or blue sky
laws (including fees and disbursements of counsel in connection with blue sky
qualifications of the Registrable Securities), (iii) printing expenses,
messenger and delivery expenses, (iv) fees and expenses incurred in connection
with the listing or quotation of the Registrable Securities, (v) fees and
expenses of counsel to the Company and the fees and expenses of independent
certified public accountants for the Company (including fees and expenses
associated with any special audits or the delivery of comfort letters),
(vi) fees and expenses of Holders’ counsel, (vii) the fees and expenses of any
additional experts retained by the Company in connection with such registration
and (viii) the fees and expenses of other persons retained by the Company,
whether or not any Shelf Registration Statement becomes effective; provided that
in no event shall Registration Expenses include any Selling Expenses or the fees
or expenses of counsel to the Underwriters.

 

Section 3.3           Underwriters; Due Diligence. In the case of an
Underwritten Offering, the Company will:

 

(a)          make such customary representations and warranties to the
applicable Selling Holders and the Underwriters or agents, if any, in form,
substance and scope as are customarily made by issuers in secondary Underwritten
Offerings, (b) enter into such customary agreements (including underwriting
agreements in customary form, which shall include, without limitation, customary
indemnification provisions) and take all such other actions as any Selling
Holder or the managing Underwriter(s), if any, reasonably request in order to
expedite or facilitate the Registration and disposition of such Registrable
Securities, (c) obtain for delivery to Holders’ Counsel and Underwriters’
Counsel and to the Underwriter(s), if any, an opinion or opinions from counsel
for the Company dated the date of the closing under the underwriting agreement,
in customary form, scope and substance (including any customary REIT tax
opinions), which opinions shall be reasonably satisfactory to Holders’ Counsel
and Underwriters’ Counsel, and (d) obtain for delivery to the Company and the
managing Underwriter(s), with copies to Holders’ Counsel and Underwriters’
Counsel, a comfort letter from the Company’s independent certified public
accountants in customary form and covering such matters of the type customarily
covered by comfort letters as the managing Underwriter(s) reasonably request,
dated the date of execution of the underwriting agreement and brought down to
the date of the closing of the Underwritten Offering, as specified in the
underwriting agreement.

 

 10 

 

 

(b)          use commercially reasonable efforts to cause appropriate officers
and employees to be reasonably available, on a customary basis and upon
commercially reasonable notice, to meet with prospective investors in
presentations, meetings and road shows and otherwise to facilitate, cooperate
with, and participate in each such proposed Underwritten Offering to the extent
reasonably requested by the managing Underwriter(s).

 

Section 3.4           Duties of Selling Holders in Underwritten Offerings.

 

(a)          In the case of an Underwritten Offering, the Selling Holders agree
to timely furnish to the Company any information regarding the Holder and the
distribution of such Holder’s Registrable Securities as the Company reasonably
determines is required to be included in any Registration Statement or any
prospectus or prospectus supplement relating to an Underwritten Offering.

 

(b)          With respect to Underwritten Offerings, (i) the right of any Holder
to include such Holder’s Registrable Securities in an Underwritten Offering
shall be conditioned upon such Holder’s participation in the process and
required delivery of information for such Underwritten Offering and the
inclusion of such Holder’s Registrable Securities in the Underwritten Offering
to the extent provided herein, (ii) each Holder participating in such
Underwritten Offering agrees to enter into an underwriting agreement in
customary form and sell such Holder’s Registrable Securities on the basis
provided in any underwriting arrangements approved by those entitled to select
the managing Underwriter(s) hereunder and (iii) each Holder participating in
such Underwritten Offering agrees to complete and execute all questionnaires,
powers of attorney, indemnities, underwriting agreements, lock-up agreements and
other documents reasonably required under the terms of such underwriting
arrangements. The Company hereby agrees with each Holder that, in connection
with any Underwritten Offering in accordance with the terms hereof, it will
negotiate in good faith and execute all indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements, including using all commercially reasonable efforts to procure
customary legal opinions and auditor “comfort” letters provided for herein.

 

 11 

 

 

ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION

 

Section 4.1           Indemnification By the Company. The Company agrees to
indemnify, and hold harmless each Selling Holder and their respective officers,
directors, partners, shareholders, members, employees, agents and
representatives and each Person (if any) which controls a Selling Holder within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages, liabilities,
costs and expenses (including reasonable attorneys’ fees) caused by, arising out
of, resulting from or related to any untrue statement or alleged untrue
statement of a material fact contained or incorporated by reference in any
registration statement or prospectus relating to the Registrable Securities (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, including all documents
attached thereto or incorporated by reference therein, or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages or liabilities are caused by or based
upon any information furnished in writing to the Company by or on behalf of such
Selling Holder or by such Selling Holder’s failure to deliver a copy of the
registration statement or prospectus or any amendments or supplements thereto
after the Company has furnished such Selling Holder with copies of the same;
provided, however, that the Company shall have no obligation to indemnify under
this sentence to the extent any such losses, claims, damages or liabilities have
been finally and non-appealability determined by a court of competent
jurisdiction to have resulted from such Selling Holder’s willful misconduct or
gross negligence or an intentional act or omission in violation of applicable
laws. The Company also agrees to indemnify any Underwriter of the Registrable
Securities, their officers and directors and each person who controls such
Underwriter on substantially the same basis as that of the indemnification of
the Selling Holders provided in this Section 4.1, except insofar as such losses,
claims, damages or liabilities are caused by or based upon any information
furnished in writing to the Company by or on behalf of such Underwriter or by
such Underwriter’s failure to deliver a copy of the registration statement or
prospectus or any amendments or supplements thereto after the Company has
furnished the Underwriter with copies of the same; provided, however, that the
Company shall have no obligation to indemnify under this sentence to the extent
any such losses, claims, damages or liabilities have been finally and
non-appealably determined by a court to have resulted from any such
Underwriter’s willful misconduct or gross negligence. The obligations of the
Company under this Section 4.1 shall be in addition to any liability that the
Company may otherwise have to any Indemnified Person and the obligations of any
Indemnified Person under this Section 4.1 shall be in addition to any liability
that such Indemnified Person may otherwise have to the Company. The remedies
provided in this Section 4.1 are not exclusive and shall not limit any rights or
remedies which may otherwise be available to an indemnified party at law or in
equity.

 

Section 4.1           Indemnification By Selling Holders. Each Selling Holder
agrees to indemnify, and hold harmless the Company, its officers and directors,
and each Person, if any, that controls the Company within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, liabilities, costs and expenses
(including reasonable attorneys’ fees) caused by, arising out of, resulting from
or related to any untrue statement or alleged untrue statement of a material
fact contained or incorporated by reference in any registration statement or
prospectus relating to the Registrable Securities (as amended or supplemented if
the Company shall have furnished any amendments or supplements thereto) or any
preliminary prospectus, including all documents attached thereto or incorporated
by reference therein, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, but only with respect to information
furnished in writing by or on behalf of such Selling Holder specifically for use
in any registration statement or prospectus relating to the Registrable
Securities, or any amendment or supplement thereto or any preliminary
prospectus. Each Selling Holder also agrees to indemnify and hold harmless any
Underwriters of the Registrable Securities, their officers and directors and
each person who controls such Underwriters on substantially the same basis as
that of the indemnification of the Company provided in this Section 4.2, but
only with reference to information furnished in writing by or on behalf of such
Selling Holder specifically for use in any registration statement or prospectus
relating to the Registrable Securities, or any amendment or supplement thereto
or any preliminary prospectus. Each such Selling Holder’s liability under this
Section 4.2 shall be limited to an amount equal to the net proceeds (after
deducting the applicable underwriting discount and expenses associated with such
Selling Holder’s Registrable Securities sold thereunder) received by such
Selling Holder from the sale of such Registrable Securities by such Selling
Holder in the applicable offering. Notwithstanding anything herein to the
contrary, the obligations of each Selling Holder under this Article IV shall be
several and not joint.

 

 12 

 

 

Section 4.2           Conduct Of Indemnification Proceedings. In case any
proceeding (including any investigation by any court, governmental, regulatory
or administrative agency or commission or other governmental authority or
instrumentality, domestic (federal, state or municipal) or foreign governmental
entity) shall be instituted involving any Person in respect of which indemnity
may be sought pursuant to Section 4.1 or Section 4.2, such Person (the
“Indemnified Party”) shall promptly notify the Person against whom such
indemnity may be sought (the “Indemnifying Party”) in writing and the
Indemnifying Party, and the Indemnifying Party shall have the right to assume
the defense thereof with counsel of its own choosing reasonably acceptable to
the Indemnified Party. Any Indemnified Party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such
Indemnified Party except to the extent that (1) the employment thereof has been
specifically authorized by the Indemnifying Party in writing, (2) the
Indemnifying Party has failed after a reasonable period of time to assume such
defense and to employ counsel or (3) in such action there is, in the reasonable
opinion of counsel, a material conflict on (or a potential material conflict
with respect to) any material issue between the position of the Indemnifying
Party and the position of such Indemnified Party, in which case the Indemnifying
Party shall be responsible for the reasonable fees and expenses of no more than
one such separate counsel. The Indemnifying Party will not be liable to any
Indemnified Party under this Agreement (y) for any settlement by a Indemnified
Party effected without the Indemnifying Party’s prior written consent, which
shall not be unreasonably withheld or delayed; or (z) to the extent, but only to
the extent, that a loss, claim, damage or liability is determined in a final,
non-appealable judgment, to directly result from any Indemnified Party’s breach
of its representations, warranties or covenants under this Agreement or any
conduct by such Indemnified Party which constitutes fraud, gross negligence or
willful misconduct. The indemnification required by this Article IV shall be
made by periodic payments of the amount thereof during the course of the
investigation or defense, as and when bills are received or are incurred. The
indemnity agreements contained herein shall be in addition to any cause of
action or similar right of any Indemnified Party against the Indemnifying Party
or others and any liabilities the Indemnifying Parties may be subject to
pursuant to applicable law.

 

Section 4.3           Contribution.

 

(a)          If the indemnification provided for in this Article IV is, by
operation of law unavailable to an Indemnified Party in respect of any losses,
claims, damages or liabilities in respect of which indemnity is to be provided
hereunder, then each such Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall to the fullest extent permitted by law, contribute to
the amount paid or payable by such Indemnified Party as a result of such losses,
claims, damages or liabilities in such proportion as is appropriate to reflect
the relative fault of such party in connection with the statements or omissions
that resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative fault of the Company, a
Selling Holder and the Underwriter 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 such party and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.

 

 13 

 

 

(b)          The Company and each Selling Holder agrees that it would not be
just and equitable if contribution pursuant to this Section 4.3 were determined
by pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an Indemnified Party as a result of the
losses, claims, damages or liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such Indemnified Party
in connection with investigating or defending any such action or claim. Each
Selling Holder shall not be required pursuant to Article IV to contribute any
amount in excess of the amount by which the proceeds of any sale (before
deducting the applicable underwriting discount and expenses associated with such
Selling Holder’s Registrable Securities in the applicable offering) received by
such Selling Holder exceeds the amount of any damages that such Selling Holder
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.

 

ARTICLE V
MISCELLANEOUS

 

Section 5.1           Participation In Underwritten Offerings. No Selling Holder
may participate in any Underwritten Offering contemplated hereunder, unless such
Selling Holder (a) agrees to sell its Registrable Securities on the basis
provided in any underwriting arrangements approved by those entitled hereunder
to approve such arrangements, (b) completes and executes all (to the extent
reasonable and customary) questionnaires, powers of attorney, custody
arrangements, of such underwriting arrangements and this Agreement and (c)
furnishes in writing to the Company such information regarding such Selling
Holder and other information as the Company may reasonably request or as may
legally be required in connection with such Underwritten Offering; provided,
however, that no such Selling Holder shall be required to make any
representations or warranties in connection with any such Underwritten Offering
other than representations and warranties as to (i) such Selling Holder’s
ownership of its Registrable Securities to be sold or transferred in a manner
that is free and clear of all liens, claims and encumbrances, (ii) such Selling
Holder’s power and authority to effect such transfer and (iii) such matters
pertaining to compliance with applicable securities laws as may reasonably be
requested; provided further, however, that the obligation of such Selling Holder
to indemnify pursuant to any such underwriting agreements shall be several, and
not joint, among such Selling Holder selling Registrable Securities, and the
liability of each such Selling Holder will be in proportion to, and, provided
further that such liability will be limited to, the net amount received by such
Selling Holder from the sale of such Selling Holder’s Registrable Securities
pursuant to such Underwritten Offering.

 

Section 5.2           Rule 144. The Company shall use commercially reasonable
efforts to file any and all reports required to be filed by it under the
Securities Act and the Exchange Act and shall take such further action as the
Holders may reasonably request to the extent required from time to time to
enable the Holders to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144, as
such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission. Upon the request of any Holder, the Company
will deliver to such Holder a written statement as to whether it has complied
with such reporting requirements.

 

Section 5.3           Amendments, Waivers, Etc. This Agreement may not be
amended, waived or otherwise modified or terminated except by an instrument in
writing signed by the Company and the Holders of at least two-thirds of the
Registrable Securities then held by all the Holders.

 

 14 

 

 

Section 5.4           Counterparts. This Agreement may be executed and delivered
(including by facsimile transmission) in one or more counterparts, all of which
shall be considered one and the same agreement and shall become effective when
one or more counterparts have been signed by each of the parties and delivered
to the other parties, it being understood that all parties need not sign the
same counterpart.

 

Section 5.5           Entire Agreement. This Agreement, together with the Stock
Purchase Agreement and the other agreements, instruments and documents referred
to herein and therein, constitutes the entire agreement of the parties hereto
and supersedes all prior agreements, letters of intent and understandings, both
written and oral, among the parties with respect to the subject matter hereof.

 

Section 5.6           Articles, Sections. Unless the context indicates
otherwise, references to Articles, Sections and paragraphs shall refer to the
corresponding articles, sections and paragraphs in this Agreement.

 

Section 5.7           Governing Law; Jurisdiction; Jury Trial. THE CORPORATE
LAWS OF THE STATE OF MARYLAND SHALL GOVERN ALL ISSUES CONCERNING THE RELATIVE
RIGHTS OF THE COMPANY AND ITS STOCKHOLDERS. ALL QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK. THE COMPANY AND HOLDERS HEREBY IRREVOCABLY SUBMIT TO THE NON-EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK,
BOROUGH OF MANHATTAN FOR THE ADJUDICATION OF ANY DISPUTE BROUGHT BY THE COMPANY
OR ANY INVESTOR HEREUNDER, IN CONNECTION HEREWITH OR WITH ANY TRANSACTION
CONTEMPLATED HEREBY OR DISCUSSED HEREIN (INCLUDING WITH RESPECT TO THE
ENFORCEMENT OF ANY OF THE TRANSACTION DOCUMENTS), AND HEREBY IRREVOCABLY WAIVE,
AND AGREE NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING BROUGHT BY THE COMPANY
OR ANY HOLDER, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION
OF ANY SUCH COURT, OR THAT SUCH SUIT, ACTION OR PROCEEDING IS IMPROPER. EACH
PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO
PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY MAILING A COPY
THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY (WITH EVIDENCE OF
DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THIS
AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD AND SUFFICIENT
SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN SHALL BE DEEMED
TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.
EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.

 

 15 

 

 

Section 5.8           Assignment of Registration Rights. No Holder of
Registrable Securities may assign all or any part of its rights under this
Agreement to any person without the prior written consent of the Company, which
consent shall not be unreasonably withheld; provided, however, that the rights
under this Agreement may be assigned to any Affiliate of the Holders to whom
Registrable Securities have been transferred without requiring the Company’s
consent, provided that the transferring Holder promptly provides notice of such
assignment and the transferee agrees in writing to be bound by the terms and
conditions of this Agreement.

 

Section 5.9           Parties in Interest. This Agreement shall be binding upon
and inure to the benefit of the Company and any successor organization that
shall succeed to substantially all of the business and property of the Company,
whether by merger, consolidation, acquisition of all or substantially all of the
assets of the Company or otherwise, including by operation of law (each, a
“Successor”). The Company hereby covenants and agrees that it shall cause any
Successor to adopt and assume this Agreement. If a parent entity of the Company
or its Successor becomes the issuer of the Registrable Securities, then the
Company or such Successor shall cause such parent entity to adopt and assume
this Agreement to the same extent as if the parent entity were the Company or
such Successor.

 

Section 5.10         Notices. Any notices, consents or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (a) upon receipt when
delivered personally; (b) upon receipt when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (c) one Business Day after deposit with a
nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses and facsimile numbers
for such communications shall be:

 

If to the Company:   Jernigan Capital, Inc. 6410 Poplar Avenue, Suite 650
Memphis, TN 38119 Telephone: 901-567-9510 Facsimile: 901-567-9557 Attention:
John A. Good Attention: William H. Mathieu     With a copy to:   Morrison &
Foerster LLP 2000 Pennsylvania Avenue, Suite 6000 Washington, DC 20006
Telephone: 202-887-1554 Facsimile: 202-785-7522 Attention: David P. Slotkin    
If to the Initial Holders:   NexPoint Advisors, L.P. 300 Crescent Court, Suite
700 Dallas, TX  75201 Telephone: 972-628-4100 Facsimile: 972-628-4147 Attention:
Matt McGraner

 

 16 

 

 

With a copy to:   Highland Capital Management, L.P. 300 Crescent Court, Suite
700 Dallas, TX  75201 Telephone: 972-628-4100 Facsimile: 972-628-4147 Attention:
Thomas Surgent     and       Jones Day 2727 North Harwood Street Dallas,
TX  75201 Telephone: 214-220-3939 Facsimile: 214-969-5100 Attention: Charles
Haag

 

or at such other address and/or facsimile number and/or to the attention of such
other person as the recipient party has specified by written notice given to
each other party one Business Day prior to the effectiveness of such change.
Written confirmation of receipt (x) given by the recipient of such notice,
consent or other communication, (y) mechanically or electronically generated by
the sender’s facsimile machine containing the time, date, and recipient
facsimile number or (z) provided by a nationally recognized overnight delivery
service, shall be rebuttable evidence of receipt in accordance with clause (a),
(b) or (c) above, respectively.

 

Section 5.11         Headings. The headings contained in this Agreement are for
convenience of reference only and are not part of the substance of this
Agreement.

 

Section 5.12         Limitations on Subsequent Registration Rights. From and
after the date of this Agreement, the Company shall not, without the prior
written consent of the Holders of not less than two-thirds of the then
outstanding Registrable Securities, enter into any agreement with any holder or
prospective holder of any equity securities of the Company that would allow such
holder or prospective holder (a) to include such equity securities in any
registration statement filed for the Registrable Securities pursuant to the
terms of this Agreement, unless under the terms of such agreement, such holder
or prospective holder may include such equity securities in any such
registration only to the extent that the inclusion of its equity securities will
not reduce the amount of Registrable Securities of the Holders or (b) to have
its equity securities registered on a registration statement that is declared
effective prior to the Effectiveness Date (exclusive of a registration statement
filed on Form S-8).

 

Section 5.13         Initial Holder Representative. Each Initial Holder hereby
acknowledges and agrees that it has irrevocably approved and appointed the
designation of, and hereby irrevocably designates, NexPoint Advisors, L.P. as
the Initial Holder Representative and NexPoint Advisors, L.P. is hereby
appointed as of the date hereof as the true and lawful agent and attorney in
fact of the Initial Holders as the Initial Holder Representative for and on
behalf of the Initial Holders to give and receive notices and communications in
connection with this Agreement and all related matters, to take all actions, and
to take all other actions that the Initial Holder Representative deems necessary
hereunder. In fulfilling its duties hereunder, the Initial Holder Representative
shall act in good faith and in a manner that the Initial Holder Representative
reasonably believes to be in the best interests of the Initial Holders, taken as
a whole. Notices or communications to or from the Initial Holder Representative
shall constitute notice to or from the Initial Holders. Each Initial Holder
hereby agrees to receive correspondence from the Initial Holder Representative,
including in electronic form. It is understood by all parties that NexPoint
Advisors, L.P. is executing this Agreement solely in its capacity as the Initial
Holder Representative. The Initial Holder Representative shall be entitled to
act in its sole and absolute discretion and shall incur no liability whatsoever
to the Initial Holders for any act done or omitted hereunder as the Initial
Holder Representative, including errors in judgment, while acting in good faith
or in reliance on the advice of counsel, accountants, or other advisors,
consultants, or experts.

 

 17 

 

 

IN WITNESS WHEREOF, the Buyers and the Company have caused this Agreement to be
duly executed as of the date first written above.

 

  THE COMPANY:       JERNIGAN CAPITAL, INC.         By: /s/ John A. Good   Name:
John A. Good   Title: President and Chief Operating Officer

 

[Signature Page to Registration Rights Agreement]

 

 

 

 

  INITIAL HOLDER Representative:       NexPoint Advisors, L.P.   By: NexPoint
Advisors GP, LLC, its general partner       By:   /s/ Brian Mitts   Name: Brian
Mitts   Title: Executive Vice President

 

[Signature Page to Registration Rights Agreement]

 

 

 

 

  BUYERS:       NexPoint Real Estate Strategies Fund         By: /s/ Brian Mitts
  Name:  Brian Mitts   Title:  Vice President, Chief Financial Officer,
Principal Financial Officer and Principal Accounting Officer           NexPoint
Real Estate Capital, LLC         By: /s/ Brian Mitts   Name: Brian Mitts  
Title:  Chief Financial Officer and Executive Vice President              
NexPoint Real Estate Opportunities, LLC       By: NexPoint Advisors, L.P., its
Manager   By: NexPoint Advisors GP, LLC, its general partner         By: /s/
Brian Mitts   Name: Brian Mitts   Title:  Executive Vice President

 

[Signature Page to Registration Rights Agreement]