EXHIBIT C 
FORM OF REGISTRATION RIGHTS AGREEMENT 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 







REGISTRATION RIGHTS
AGREEMENT 

This Registration Rights
Agreement (this “Agreement”) is made
and entered into January __, 2015, by and among Independence Bancshares, Inc.
d/b/a nD bancgroup, a South Carolina corporation (the “Company”), and the purchasers signatory hereto (each a “Purchaser” and collectively, the “Purchasers”).

This Agreement is made
pursuant to the Subscription Agreements, dated as of January __, 2015, between
the Company and each Purchaser (the “Subscription Agreement”).

NOW, THEREFORE, IN
CONSIDERATION of the mutual
covenants contained in this Agreement, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Company and each of the Purchasers agree as follows:

1. Definitions. Capitalized
terms used and not otherwise defined herein that are defined in the Subscription
Agreement shall have the meanings given such terms in the Subscription
Agreement. As used in this Agreement, the following terms shall have the
following meanings:

“Advice” shall have the meaning set forth in Section 6(d).

“Affiliate” means, with respect to any person, any other
person which directly or indirectly controls, is controlled by, or is under
common control with, such person.

“Agreement” shall have the meaning set forth in the
Preamble.

“Business Day” means a day, other than a Saturday or Sunday, on
which banks in the State of South Carolina are open for the general transaction
of business.

“Closing” has the meaning set forth in the Subscription Agreement. 

“Closing Date” has the meaning set forth in the Subscription
Agreement. 

“Commission” means the Securities and Exchange
Commission.

“Common Stock” means the common stock of the Company, par value
$0.01 per share, and any securities into which such shares of common stock may
hereinafter be reclassified.

“Company” shall have the meaning set forth in the Preamble.

“Effective Date” means the date that the Registration Statement
filed pursuant to Section 2(a) is first declared effective by the
Commission.

“Effectiveness Deadline” means, with respect to the Initial Registration
Statement or the New Registration Statement, the earlier of (i) the 90th
calendar day following the Closing Date (or the 120th calendar day following the
Closing Date in the event that such registration statement is subject to review
by the Commission) and (ii) the 5th Business Day after the date the Company is
notified (orally or in writing, whichever is earlier) by the Commission that
such Registration Statement will not be “reviewed” or will not be subject to
further review; provided, that if the Effectiveness Deadline falls on a
Saturday, Sunday or other day that the Commission is closed for business, the
Effectiveness Deadline shall be extended to the next Business Day on which the
Commission is open for business.







“Effectiveness Period” shall have the meaning set forth in Section
2(b).

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

“Filing Deadline” means, with respect to the Initial Registration
Statement required to be filed pursuant to Section 2(a), the 45th calendar day
following the Closing Date, provided, that if the
Filing Deadline falls on a Saturday, Sunday or other day that the Commission is
closed for business, the Filing Deadline shall be extended to the next business
day on which the Commission is open for business.

“Holder” or “Holders” means the
holder or holders, as the case may be, from time to time of Registrable
Securities.

“Indemnified Party” shall have the meaning set forth in Section
5(c).

“Indemnifying Party” shall have the meaning set forth in Section
5(c).

“Initial Registration Statement” means the initial Registration Statement filed
pursuant to Section 2(a) of this Agreement.

“Losses” shall have the meaning set forth in Section 5(a).

“New Registration Statement” shall have the meaning set forth in Section
2(a).

“Person” means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or subdivision thereof) or other entity
of any kind.

“Preferred Shares” means the Series A preferred shares of the
Company, par value $0.01 per share.

“Proceeding” means an action, claim, suit, investigation or
proceeding (including, without limitation, an investigation or partial
proceeding, such as a deposition), whether commenced or threatened.

“Prospectus” means the prospectus included in a Registration
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by a Registration Statement, and all other amendments and
supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in
such Prospectus.







“Purchaser” or “Purchasers” shall have
the meaning set forth in the Preamble.

“Registrable Securities” means all of the Preferred Shares and Underlying
Shares and any securities issued or issuable upon any stock split, dividend or
other distribution, recapitalization or similar event with respect to the
Preferred Shares and the Underlying Shares, provided, that the Holder has completed and delivered to the Company a Selling
Shareholder Questionnaire; and
provided, further, that Preferred
Shares and the Underlying Shares shall cease to be Registrable Securities upon
the earliest to occur of the following: (A) a sale pursuant to a Registration
Statement or Rule 144 under the Securities Act (in which case, only such
security sold shall cease to be a Registrable Security); (B) becoming eligible
for sale without the requirement for the Company to be in compliance with the
current public information required under Rule 144(c)(1) (or Rule 144(i)(2), if
applicable) and without volume or manner of sale restrictions by Holders who are
not Affiliates of the Company; (C) if such Preferred Shares and the Underlying
Shares have ceased to be outstanding; or (D) if such Preferred Shares and the
Underlying Shares have been sold in a private transaction in which the Holder’s
rights under this Agreement have not been assigned to the transferee.

“Registration Statements” means any one or more registration statements of
the Company filed under the Securities Act that covers the resale of any of the
Registrable Securities pursuant to the provisions of this Agreement (including
without limitation the Initial Registration Statement, the New Registration
Statement and any Remainder Registration Statements), amendments and supplements
to such Registration Statements, including post-effective amendments, all
exhibits and all material incorporated by reference or deemed to be incorporated
by reference in such Registration Statements.

“Remainder Registration
Statement” shall have the
meaning set forth in Section 2(a).

“Rule 144” means Rule 144 promulgated by the Commission
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 Commission having
substantially the same effect as such Rule.

“Rule 415” means Rule 415 promulgated by the Commission
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 Commission having
substantially the same effect as such Rule.

“Rule 424” means Rule 424 promulgated by the Commission
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 Commission having
substantially the same effect as such Rule.







“SEC Guidance”
means (i) any publicly-available written or oral guidance, comments,
requirements or requests of the Commission staff and (ii) the Securities
Act.

“Securities Act” means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.

“Selling Shareholder
Questionnaire” means a
questionnaire in the form attached as Annex B hereto, or such
other form of questionnaire as may reasonably be adopted by the Company from
time to time.

“Subscription Agreement” shall have the meaning set forth in the
Recitals.

“Underlying Shares” means all shares underlying the Preferred
Shares, including the shares of Common Stock.

2. Registration.

(a) On or
prior to the Filing Deadline, the Company shall file a Registration Statement
with the Commission covering the resale of all of the Registrable Securities not
already covered by an existing and effective Registration Statement for an
offering to be made on a continuous basis pursuant to Rule 415 or, if Rule 415
is not available for offers and sales of the Registrable Securities, by such
other means of distribution of Registrable Securities as the Company may
reasonably determine (the “Initial Registration Statement”). The Initial Registration Statement shall be on Form S-1 or such other
Commission form which the Company is eligible to use with respect to the resale
from time to time, whether underwritten or otherwise, of the Registrable
Securities by the Holders (except if the Company is then eligible to register
for resale the Registrable Securities on Form S-3, then such registration shall
be on Form S-3) subject to the provisions of Section 2(e) and shall contain
(except if otherwise required pursuant to written comments received from the
Commission upon a review of such Registration Statement) the “Plan of
Distribution” section substantially in the form attached hereto as
Annex A. Notwithstanding the
registration obligations set forth in this Section 2, in the event the
Commission informs the Company that all of the Registrable Securities cannot, as
a result of the application of Rule 415, be registered for resale as a secondary
offering on a single registration statement, the Company agrees to (i) inform
each of the Holders thereof and use its commercially reasonable efforts to file
amendments to the Initial Registration Statement as required by the Commission
and/or (ii) withdraw the Initial Registration Statement and file a new
registration statement (a “New
Registration Statement”), in
either case covering the maximum number of Registrable Securities permitted to
be registered by the Commission, on Form S-1 or such other form available to the
Company to register for resale the Registrable Securities as a secondary
offering; provided, that prior to filing such amendment or New
Registration Statement, the Company shall be obligated to use its commercially
reasonable efforts to advocate with the Commission for the registration of all
of the Registrable Securities in accordance with the SEC Guidance, including
without limitation, Compliance and Disclosure Interpretation 612.09.
Notwithstanding any other provision of this Agreement, if any SEC Guidance sets
forth a limitation of the number of Registrable Securities or other shares of
Common Stock permitted to be registered on a particular Registration Statement
as a secondary offering (and notwithstanding
that the Company used diligent efforts to advocate with the Commission for the
registration of all or a greater number of Registrable Securities), the number
of Registrable Securities or other shares of Common Stock to be registered on
such Registration Statement will be reduced on a pro rata basis. In the event
the Company amends the Initial Registration Statement or files a New
Registration Statement, as the case may be, under clauses (i) or (ii) above, the
Company will use its commercially reasonable efforts to file with the Commission
one or more registration statements on Form S-1 or such other form available to
the Company to register for resale those Registrable Securities that were not
registered for resale on the Initial Registration Statement, as amended, or the
New Registration Statement (the “Remainder Registration Statements”). No Holder shall be named as an “underwriter”
in any Registration Statement without such Holder’s prior
consent.







(b) The
Company shall use its commercially reasonable efforts to cause each Registration
Statement to be declared effective by the Commission as soon as practicable (and
in no event later than the Effectiveness Deadline) and keep each Registration
Statement continuously effective under the Securities Act until the earlier of
(i) such time as all of the Registrable Securities covered by such Registration
Statement have been publicly sold by the Holders or (ii) the date that all
Registrable Securities covered by such Registration Statement may be sold by
non-affiliates of the Company without volume or manner of sale restrictions
under Rule 144, without the requirement for the Company to be in compliance with
the current public information requirements under Rule 144(c)(1) (or Rule
144(i)(2), if applicable), as determined by counsel to the Company pursuant to a
written opinion letter to such effect, addressed and reasonably acceptable to
the Company’s transfer agent and the affected Holders (the “Effectiveness Period”). Upon receipt of notice from the Commission
that the Company may request acceleration of the effectiveness of a Registration
Statement, the Company shall request such effectiveness. The Company shall
notify the Holders via facsimile or electronic mail of a “.pdf” format data file
of the effectiveness of a Registration Statement. The Company shall file a final
Prospectus with the Commission, as required by Rule 424(b).

(c) Each
Holder agrees to furnish to the Company a completed Selling Shareholder
Questionnaire not more than 10 Business Days following the date of this
Agreement. At least five Business Days prior to the first anticipated filing
date of a Registration Statement for any registration under this Agreement, the
Company will notify each Holder of the information the Company requires from
that Holder other than the information contained in the Selling Shareholder
Questionnaire, if any, which shall be completed and delivered to the Company
promptly upon request and, in any event, within two Business Days prior to the
applicable anticipated filing date. Each Holder further agrees that it shall not
be entitled to be named as a selling securityholder in the Registration
Statement or use the Prospectus for offers and resales of Registrable Securities
at any time, unless such Holder has returned to the Company a completed and
signed Selling Shareholder Questionnaire and a response to any requests for
further information as described in the previous sentence. If a Holder of
Registrable Securities returns a Selling Shareholder Questionnaire or a request
for further information, in either case, after its respective deadline, the
Company shall use its commercially reasonable efforts at the expense of the
Holder who failed to return the Selling Shareholder Questionnaire or to respond
for further information to take such actions as are required to name such Holder
as a selling security holder in the Registration Statement or any pre-effective
or post-effective amendment thereto and to
include (to the extent not theretofore included) in the Registration Statement
the Registrable Securities identified in such late Selling Shareholder
Questionnaire or request for further information. Each Holder acknowledges and
agrees that the information in the Selling Shareholder Questionnaire or request
for further information as described in this Section 2(c) will be used by the
Company in the preparation of the Registration Statement and hereby consents to
the inclusion of such information in the Registration
Statement.







(d) Notwithstanding anything to the contrary herein, at any time after the
Registration Statement has been declared effective by the Commission, the
Company may delay the disclosure of material non-public information concerning
the Company if the disclosure of such information at the time is not, in the
good faith judgment of the Company, in the best interests of the Company (a
“Grace
Period”); provided, the Company shall promptly (i) notify the Holders in writing of the
existence of material non-public information giving rise to a Grace Period
(provided that the Company shall not disclose the content of such material
non-public information to the Holders) or the need to file a post-effective
amendment, as applicable, and the date on which such Grace Period will begin,
(ii) use commercially reasonable efforts to terminate a Grace Period and (iii)
notify the Holders in writing of the date on which the Grace Period ends;
provided, further, that no single Grace Period shall exceed forty-five (45)
consecutive days, and during any three hundred sixty-five (365) day period, the
aggregate of all Grace Periods shall not exceed an aggregate of ninety (90) days
(each Grace Period complying with this provision being an “Allowable Grace Period”). For purposes of determining the length of a
Grace Period, the Grace Period shall be deemed to begin on and include the date
the Holders receive the notice referred to in clause (i) above and shall end on
and include the later of the date the Holders receive the notice referred to in
clause (iii) above and the date referred to in such notice; provided that no
Grace Period shall be longer than an Allowable Grace Period. Notwithstanding
anything to the contrary, the Company shall cause its transfer agent to deliver
unlegended Common Stock to a transferee of a Holder in accordance with the terms
of the Subscription Agreement in connection with any sale of Registrable
Securities with respect to which a Holder has entered into a contract for sale
prior to the Holder’s receipt of the notice of a Grace Period and for which the
Holder has not yet settled.

(e) In the
event that Form S-3 becomes available for the registration of the resale of
Registrable Securities hereunder, the Company shall (i) use commercially
reasonable efforts to register the resale of the Registrable Securities on Form
S-3 and (ii) use commercially reasonable efforts to undertake to register the
Registrable Securities on Form S-3 after such form becomes available,
provided that the Company shall maintain the effectiveness
of the Registration Statement then in effect until such time as a Registration
Statement on Form S-3 covering the Registrable Securities has been declared
effective by the Commission.

3. Registration Procedures

In connection with the
Company’s registration obligations hereunder:

(a) prior
to the filing of a Registration Statement and any related Prospectus or any
amendment or supplement thereto (except for Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and any similar
or successor reports), the Company shall
furnish to the Holder copies of such Registration Statement, Prospectus or
amendment or supplement thereto, as proposed to be filed, which documents will
be subject to the reasonable review of such Holder (it being acknowledged and
agreed that if a Holder does not object to or comment on the aforementioned
documents within three Business Days, then the Holder shall be deemed to have
consented to and approved the use of such documents). The Company shall not file
any Registration Statement or amendment or supplement thereto in a form to which
a Holder reasonably objects in good faith, provided that, the Company is
notified of such objection in writing within the three Business Day period
described above.







(b) (i)
the Company shall prepare and file with the Commission such amendments
(including post-effective amendments), and supplements, to each Registration
Statement and the Prospectus used in connection therewith as may be necessary to
keep such Registration Statement continuously effective as to the applicable
Registrable Securities for its Effectiveness Period (except during an Allowable
Grace Period); (ii) the Company shall cause the related Prospectus to be amended
or supplemented by any required Prospectus supplement (subject to the terms of
this Agreement), and, as so supplemented or amended, to be filed pursuant to
Rule 424 (except during an Allowable Grace Period); (iii) the Company shall
respond to any comments received from the Commission with respect to each
Registration Statement or any amendment thereto and provide the Holders true and
complete copies of all correspondence from and to the Commission relating to
such Registration Statement that pertains to the Holders as “Selling
Shareholders” but not any comments that would result in the disclosure to the
Holders of material and non-public information concerning the Company; and (iv)
the Company shall comply with the provisions of the Securities Act and the
Exchange Act with respect to the disposition of all Registrable Securities
covered by a Registration Statement until such time as all of such Registrable
Securities shall have been disposed of (subject to the terms of this Agreement)
in accordance with the intended methods of disposition by the Holders thereof as
set forth in such Registration Statement as so amended or in such Prospectus as
so supplemented; provided, that each
Purchaser shall be responsible for the delivery of the Prospectus to the Persons
to whom such Purchaser sells any of the Registrable Securities (including in
accordance with Rule 172 under the Securities Act), and each Purchaser agrees to
dispose of Registrable Securities in compliance with the plan of distribution
described in the Registration Statement and otherwise in compliance with
applicable federal and state securities laws. In the case of amendments and
supplements to a Registration Statement which are required to be filed pursuant
to this Agreement (including pursuant to this Section 3(b)) by reason of the
Company filing a report on Form 10-K, Form 10-Q or Form 8-K or any analogous
report under the Exchange Act, the Company shall have incorporated such report
by reference into such Registration Statement, if applicable, or shall file such
amendments or supplements with the Commission on the same day on which the
Exchange Act report which created the requirement for the Company to amend or
supplement such Registration Statement was filed.







(c) the
Company shall promptly notify the Holders (which notice shall, pursuant to
clauses (iii) through (v) hereof, be accompanied by an instruction to suspend
the use of the Prospectus until the requisite changes have been made) (i)(A)
when a Prospectus or any Prospectus supplement or post-effective amendment to a
Registration Statement is proposed to be filed; (B) when the Commission notifies
the Company whether there will be a “review” of such Registration Statement and
whenever the Commission comments in writing on any Registration Statement
(in which case the Company shall provide to each of the Holders true and
complete copies of all comments that pertain to the Holders as a “Selling
Shareholder” or to the “Plan of Distribution” and all written responses thereto,
but not information that the Company believes would constitute material and
non-public information); and (C) with respect to each Registration Statement or
any post-effective amendment, when the same has become effective; (ii) of any
request by the Commission or any other Federal or state governmental authority
for amendments or supplements to a Registration Statement or Prospectus or for
additional information that pertains to the Holders as “Selling Shareholder” or
the “Plan of Distribution”; (iii) of the issuance by the Commission or any other
federal or state governmental authority of any stop order suspending the
effectiveness of a Registration Statement covering any or all of the Registrable
Securities or the initiation of any Proceedings for that purpose; (iv) of the
receipt by the Company of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction, or the initiation or threatening of any
Proceeding for such purpose; and (v) of the occurrence of any event or passage
of time that makes the financial statements included in a Registration Statement
ineligible for inclusion therein or any statement made in such Registration
Statement or Prospectus or any document incorporated or deemed to be
incorporated therein by reference untrue in any material respect or that
requires any revisions to such Registration Statement, Prospectus or other
documents so that, in the case of such Registration Statement or the Prospectus,
as the case may be, it will not contain any 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 case of any Prospectus, form of prospectus
or supplement thereto, in light of the circumstances under which they were
made), not misleading.

(d) the
Company shall use commercially reasonable efforts to avoid the issuance of, or,
if issued, obtain the withdrawal of (i) any order suspending the effectiveness
of a Registration Statement, or (ii) any suspension of the qualification (or
exemption from qualification) of any of the Registrable Securities for sale in
any jurisdiction, as soon as practicable.

(e) the
Company shall, if requested by a Holder, furnish to such Holder, without charge,
at least one conformed copy of each Registration Statement and each amendment
thereto and all exhibits to the extent requested by such Person (including those
previously furnished or incorporated by reference) after the filing of such
documents with the Commission; provided, that the Company
shall have no obligation to provide any document pursuant to this clause that is
available on the Commission’s EDGAR system. The Company further agrees to
promptly deliver to each Holder, without charge, as many copies of each
Prospectus or Prospectuses (including each form of prospectus) and each
amendment or supplement thereto as such Persons may reasonably request. The
Company hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling Holders in connection with the
offering and sale of Registrable Securities covered by such Prospectus and any
amendment or supplement thereto.







(f) the
Company shall, prior to any resale of Registrable Securities by a Holder, use
its commercially reasonable efforts to register or qualify or cooperate with the
selling Holders in connection with the registration or qualification (or
exemption from the registration or qualification) of such Registrable
Securities for the resale by the Holder under the securities or Blue Sky laws of
such jurisdictions within the United States as any Holder reasonably requests in
writing, to keep each registration or qualification (or exemption therefrom)
effective during the Effectiveness Period and to do any and all other acts or
things reasonably necessary to enable the disposition in such jurisdictions of
the Registrable Securities covered by each Registration Statement;
provided, that the Company shall not be required to
qualify generally to do business in any jurisdiction where it is not then so
qualified, subject the Company to any material tax in any such jurisdiction
where it is not then so subject or file a general consent to service of process
in any such jurisdiction.

(g) the
Company shall cooperate with the Holders to facilitate the timely preparation
and delivery of certificates representing Registrable Securities to be delivered
to a transferee pursuant to the Registration Statement, which certificates shall
be free, to the extent permitted by the Subscription Agreement and under law, of
all restrictive legends, and to enable such Registrable Securities to be in such
denominations and registered in such names as any such Holders may reasonably
request. Certificates for Registrable Securities free from all restrictive
legends may be transmitted by the transfer agent to a Holder by crediting the
account of such Holder’s prime broker with DTC as directed by such
Holder.

(h) the
Company shall, as promptly and reasonably practicable following the occurrence
of any event contemplated by Section 3(c)(iii)-(v), prepare and file a
supplement or amendment, including a post-effective amendment, to the affected
Registration Statements 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, no
Registration Statement nor any Prospectus will 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 the case of any Prospectus, form of
prospectus or supplement thereto, in light of the circumstances under which they
were made), not misleading.

(i) the
Company may require each selling Holder to furnish to the Company a certified
statement as to (i) the number of shares of Common Stock beneficially owned by
such Holder and any Affiliate thereof, (ii) any Financial Industry Regulatory
Authority (“FINRA”) affiliations,
(iii) any natural persons who have the power to vote or dispose of the Common
Stock and (iv) any other information as may be requested by the Commission,
FINRA or any state securities commission.

(j) the
Company shall cooperate with any registered broker through which a Holder
proposes to resell its Registrable Securities in effecting a filing with FINRA
pursuant to FINRA Rule 5110 as requested by any such Holder and the Company
shall pay the filing fee required for the first such filing within two Business
Days of the request therefor.

(k) if
requested by a Holder, the Company shall (i) incorporate in a Prospectus
supplement or post-effective amendment to the Registration Statement such
information as the Company reasonably agrees should be included therein and (ii)
make all required filings of such Prospectus supplement or such post-effective
amendment as soon as reasonably practicable after the Company has received notification of the matters to be incorporated
in such Prospectus supplement or post-effective amendment.







(l) the
Company shall otherwise use commercially reasonable efforts to comply with all
applicable rules and regulations of the Commission under the Securities Act and
the Exchange Act, including Rule 172, notify the Holders if the Company no
longer satisfies the conditions of Rule 172 and take such other actions as may
be reasonably necessary to facilitate the registration of the Registrable
Securities hereunder; and make available to its security holders, as soon as
reasonably practicable, but not later than the Availability Date (as defined
below), an earnings statement covering a period of at least twelve (12) months,
beginning after the effective date of each Registration Statement, which earning
statement shall satisfy the provisions of Section 11(a) of the Securities Act,
including Rule 158 promulgated thereunder (for the purpose of this Section 3,
“Availability
Date” means the 45th day
following the end of the fourth fiscal quarter that includes the effective date
of such Registration Statement, except that, if such fourth fiscal quarter is
the last quarter of the Company’s fiscal year, “Availability Date” means the 90th day after the end of such fourth
fiscal quarter), in each case subject to extensions permissible under applicable
law.

4. Registration Expenses. All
fees and expenses incident to the Company’s performance of or compliance with
its obligations under this Agreement (excluding underwriting discounts, selling
commissions and legal fees and expenses of any Holder) shall be borne by the
Company whether or not any Registrable Securities are sold pursuant to a
Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to be made with the Commission and any national securities exchange or
other-the-counter service or other trading market on which the Common Stock is
then listed or quoted, (B) with respect to compliance with applicable state
securities or Blue Sky laws (including, without limitation, fees and
disbursements of counsel for the Company in connection with Blue Sky
qualifications or exemptions of the Registrable Securities and determination of
the eligibility of the Registrable Securities for investment under the laws of
such jurisdictions as requested by the Holders) and (C) if not previously paid
by the Company in connection with an issuer filing, with respect to any filing
that may be required to be made by any broker through which a Holder intends to
make sales of Registrable Securities with FINRA pursuant to FINRA Rule 5110, so
long as the broker is receiving no more than a customary brokerage commission in
connection with such sale, (ii) printing expenses (including, without
limitation, expenses of printing certificates for Registrable Securities and of
printing prospectuses if the printing of prospectuses is reasonably requested by
the Holders of a majority of the Registrable Securities included in the
Registration Statement), (iii) messenger, telephone and delivery expenses of the
Company, (iv) fees and disbursements of counsel for the Company, (v) Securities
Act liability insurance, if the Company so desires such insurance, and (vi) fees
and expenses of all other Persons retained by the Company in connection with the
consummation of the transactions contemplated by this Agreement. In addition,
the Company shall be responsible for all of its internal expenses incurred in
connection with the consummation of the transactions contemplated by this
Agreement (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense of
any annual audit and the fees and expenses incurred in connection with the
listing of the Registrable Securities on any
securities exchange as required hereunder. In no event shall the Company be
responsible for any underwriting, broker or similar fees or commissions of any
Holder or, except to the extent provided for in the Transaction Documents, any
legal fees or other costs of the Holders.







5. Indemnification.

(a) Indemnification by the Company. The Company shall, notwithstanding any termination of this Agreement,
indemnify, defend and hold harmless each Holder, the officers, directors,
agents, general partners, managing members, managers, Affiliates, employees and
investment advisors of each of them, each Person who controls any such Holder
(within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) and the officers, directors, general partners, managing members,
managers, agents, employees and investment advisors of each such controlling
Person, to the fullest extent permitted by applicable law, from and against any
and all losses, claims, damages, liabilities, costs (including, without
limitation, reasonable costs of preparation and investigation and reasonable
attorneys’ fees) and expenses (collectively, “Losses”), as incurred, that arise out of or are based upon (i) any untrue or
alleged untrue statement of a material fact contained in any Registration
Statement, any Prospectus or any form of prospectus or in any amendment or
supplement thereto or in any preliminary prospectus, or arising out of or
relating to any omission or alleged omission to state a material fact required
to be stated therein or necessary to make the statements therein (in the case of
any Prospectus or form of prospectus or supplement thereto, in light of the
circumstances under which they were made) not misleading, or (ii) any violation
or alleged violation by the Company of the Securities Act, Exchange Act or any
state securities law or any rule or regulation thereunder, in connection with
the performance of its obligations under this Agreement, except to the extent,
but only to the extent, that (A) such untrue statements, alleged untrue
statements, omissions or alleged omissions are based solely upon information
regarding such Holder furnished in writing to the Company by such Holder
expressly for use therein, or to the extent that such information relates to
such Holder or such Holder’s proposed method of distribution of Registrable
Securities and was reviewed and approved (or deemed reviewed and approved) by
such Holder expressly for use in the Registration Statement, such Prospectus or
such form of Prospectus or in any amendment or supplement thereto (it being
understood that each Holder has approved Annex A hereto for this
purpose), or (B) in the case of an occurrence of an event of the type specified
in Section 3(c)(iii)-(v), related to the use by a Holder of an outdated or
defective Prospectus after the Company has notified such Holder in writing that
the Prospectus is outdated or defective and prior to the receipt by such Holder
of the Advice contemplated and defined in Section 6(d) below, but only if and to
the extent that following the receipt of the Advice the misstatement or omission
giving rise to such Loss would have been corrected. The Company shall notify the
Holders of the institution, threat or assertion of any Proceeding arising from
or in connection with the transactions contemplated by this Agreement of which
the Company is aware. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of an Indemnified Party (as
defined in Section 5(c)) and shall survive the transfer of the Registrable
Securities by the Holders.







(b) Indemnification by Holders. Each Holder shall, severally and not jointly, indemnify and hold
harmless the Company, its directors, officers, agents and employees, each Person
who controls the Company (within the meaning of Section 15 of the Securities Act
and Section 20 of the Exchange Act), and the directors, officers, agents
or employees of such controlling Persons, to the fullest extent permitted by
applicable law, from and against all Losses, as incurred, arising out of or are
based upon any untrue or alleged untrue statement of a material fact contained
in any Registration Statement, any Prospectus, or any form of prospectus, or in
any amendment or supplement thereto or in any preliminary prospectus, or arising
out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein (in
the case of any Prospectus, or any form of prospectus or supplement thereto, in
light of the circumstances under which they were made) not misleading (i) to the
extent, but only to the extent, that such untrue statements or omissions are
based solely upon information regarding such Holder furnished in writing to the
Company by such Holder expressly for use therein or (ii) to the extent, but only
to the extent, that such information relates to such Holder or such Holder’s
proposed method of distribution of Registrable Securities and was reviewed and
approved (or deemed reviewed and approved) by such Holder expressly for use in a
Registration Statement (it being understood that the Holder has approved
Annex A hereto for this purpose), such Prospectus or such
form of Prospectus or in any amendment or supplement thereto or (iii) in the
case of an occurrence of an event of the type specified in Section
3(c)(iii)-(v), to the extent, but only to the extent, related to the use by such
Holder of an outdated or defective Prospectus after the Company has notified
such Holder in writing that the Prospectus is outdated or defective and prior to
the receipt by such Holder of the Advice contemplated in Section 6(d), but only
if and to the extent that following the receipt of the Advice the misstatement
or omission giving rise to such Loss would have been corrected. In no event
shall the liability of any selling Holder hereunder be greater in amount than
the dollar amount of the net proceeds received by such Holder upon the sale of
the Registrable Securities giving rise to such indemnification
obligation.

(c) Conduct of Indemnification Proceedings. If any Proceeding shall be brought or asserted
against any Person entitled to indemnity hereunder (an “Indemnified Party”), such Indemnified Party shall promptly notify
the Person from whom indemnity is sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall
have the right to assume the defense thereof, including the employment of
counsel reasonably satisfactory to the Indemnified Party and the payment of all
reasonable fees and expenses incurred in connection with defense thereof;
provided, that the failure of any Indemnified Party to
give such notice shall not relieve the Indemnifying Party of its obligations or
liabilities pursuant to this Agreement, except (and only) to the extent that
such failure shall have materially and adversely prejudiced the Indemnifying
Party (as finally determined by a court of competent jurisdiction, which
determination is not subject to appeal or further review).







An Indemnified Party shall
have the right to employ separate counsel in any such Proceeding and to
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Party or Parties unless: (1) the
Indemnifying Party has agreed in writing to pay such fees and expenses; (2) the
Indemnifying Party shall have failed promptly to assume the defense of such
Proceeding and to employ counsel reasonably satisfactory to such Indemnified
Party in any such Proceeding; or (3) the named parties to any such Proceeding
(including any impleaded parties) include both such Indemnified Party and the
Indemnifying Party, and such Indemnified Party shall have been advised by
counsel that a conflict of interest exists if the same counsel were to represent
such Indemnified Party and the Indemnifying Party; provided, that the Indemnifying Party shall not be liable for the fees and
expenses of more than one separate firm of attorneys at any time for all
Indemnified Parties. The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which
consent shall not be unreasonably withheld, delayed or conditioned. No
Indemnifying Party shall, without the prior written consent of the Indemnified
Party, effect any settlement of any pending Proceeding in respect of which any
Indemnified Party is a party, unless such settlement includes an unconditional
release of such Indemnified Party from all liability on claims that are the
subject matter of such Proceeding.

Subject to the terms of
this Agreement, all fees and expenses of the Indemnified Party (including
reasonable fees and expenses to the extent incurred in connection with
investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Section 5(c)) shall be paid to the Indemnified Party, as
incurred, within 20 Business Days of written notice thereof to the Indemnifying
Party; provided, that the Indemnified Party shall promptly
reimburse the Indemnifying Party for that portion of such fees and expenses
applicable to such actions for which such Indemnified Party is finally
judicially determined to not be entitled to indemnification hereunder). The
failure to deliver written notice to the Indemnifying Party within a reasonable
time of the commencement of any such action shall not relieve such Indemnifying
Party of any liability to the Indemnified Party under this Section 5, except to
the extent that the Indemnifying Party is materially and adversely prejudiced in
its ability to defend such action.

(d) Contribution. If a claim
for indemnification under Section 5(a) or 5(b) is unavailable to an Indemnified
Party or insufficient to hold an Indemnified Party harmless for any Losses, then
each Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Losses, in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Party and Indemnified Party in connection with the
actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative fault of such Indemnifying
Party and Indemnified Party shall be determined by reference to, among other
things, whether any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission of a material fact,
has been taken or made by, or relates to information supplied by, such
Indemnifying Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission. The amount paid or payable by a party as a result
of any Losses shall be deemed to include, subject to the limitations set forth
in this Agreement, any reasonable attorneys’ or other reasonable fees or
expenses incurred by such party in connection with any Proceeding to the extent
such party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section 5(d) was available to such party in
accordance with its terms.

The parties hereto agree
that it would not be just and equitable if contribution pursuant to this Section
5(d) were determined by pro rata allocation or by any other method of allocation
that does not take into account the equitable considerations referred to in the
immediately preceding paragraph. Notwithstanding the provisions of this Section
5(d), no Holder shall be required to contribute, in the aggregate, any amount in
excess of the amount by which the net proceeds actually received by such Holder from the sale of the Registrable
Securities subject to the Proceeding exceeds the amount of any damages that such
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.







The indemnity and
contribution agreements contained in this Section 5 are in addition to any
liability that the Indemnifying Parties may have to the Indemnified Parties and
are not in diminution or limitation of the indemnification provisions under the
Subscription Agreement.

6. Miscellaneous.

(a) Remedies. In the event of
a breach by the Company or by a Holder of any of their obligations under this
Agreement, each Holder or the Company, as the case may be, in addition to being
entitled to seek to exercise all rights granted by law and under this Agreement,
will be entitled to specific performance of its rights under this Agreement. The
Company and each Holder agree that monetary damages would not provide adequate
compensation for any losses incurred by reason of a breach by it of any of the
provisions of this Agreement and hereby further agrees that, in the event of any
action for specific performance in respect of such breach, it shall waive the
defense that a remedy at law would be adequate.

(b) No
Piggyback on Registrations; Prohibition on Filing Other
Registration Statements. Neither the Company nor any of its security holders may include
securities of the Company in a Registration Statement hereunder and the Company
shall not prior to the Effective Date enter into any agreement providing any
such right to any of its security holders. The Company shall not, from the date
hereof until the date that is 60 days after the Effective Date of the Initial
Registration Statement, prepare and file with the Commission a registration
statement relating to an offering for its own account under the Securities Act
of any of its equity securities, other than (i) a registration statement on Form
S-8, (ii) in connection with an acquisition on Form S-4, (iii) one shelf
registration statement and one resale registration statement on Form S-1 or (iv)
a registration statement to register for resale securities issued by the Company
pursuant to acquisitions or strategic transactions approved by a majority of the
disinterested directors of the Company, provided that any such issuance shall
only be to a Person which is, itself or through its subsidiaries, an operating
company in a business synergistic with the business of the Company and in which
the Company receives benefits in addition to the investment of funds, but shall
not include a transaction in which the Company is issuing securities primarily
for the purpose of raising capital or to an entity whose primary business is
investing in securities. For the avoidance of doubt, the Company shall not be
prohibited from preparing and filing with the Commission a registration
statement relating to an offering of Common Stock by existing shareholders of
the Company under the Securities Act pursuant to the terms of registration
rights held by such shareholder or from filing amendments to registration
statements filed prior to the date of this Agreement (or, for the avoidance of
doubt, filing any prospectus supplements related thereto pursuant to Rule
424).







(c) Compliance. Each Holder
covenants and agrees that it will comply with the prospectus delivery
requirements of the Securities Act as applicable to it (unless an exemption
therefrom is available) in connection with sales of Registrable Securities
pursuant to the Registration Statement and shall sell the Registrable Securities
only in accordance with a method of distribution described in the Registration
Statement

(d) Discontinued Disposition.
By its acquisition of Registrable Securities, each Holder agrees that, upon
receipt of a notice from the Company of the occurrence of any event of the kind
described in Section 3(c)(iii)-(v), such Holder will forthwith discontinue
disposition of such Registrable Securities under a Registration Statement until
it is advised in writing (the “Advice”) by the
Company that the use of the applicable Prospectus (as it may have been
supplemented or amended) may be resumed. The Company may provide appropriate
stop orders to enforce the provisions of this paragraph.

(e) No
Inconsistent Agreements. Neither
the Company nor any of its Subsidiaries has entered, as of the date hereof, nor
shall the Company or any of its Subsidiaries, on or after the date hereof, enter
into any agreement with respect to its securities, that would have the effect of
impairing the rights granted to the Holders in this Agreement or otherwise
conflicts with the provisions hereof.

(f) Amendments and Waivers.
The provisions of this Agreement, including the provisions of this sentence, may
not be amended, modified or supplemented, or waived unless the same shall be in
writing and signed by the Company and Holders holding at least two-thirds of the
then outstanding Registrable Securities, provided that any party may give a
waiver as to itself. Notwithstanding the foregoing, a waiver or consent to
depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of Holders and that does not directly or indirectly
affect the rights of other Holders may be given by Holders of all of the
Registrable Securities to which such waiver or consent relates; provided, that the provisions of this sentence may not be amended, modified, or
supplemented except in accordance with the provisions of the immediately
preceding sentence. Notwithstanding the foregoing, if any such amendment,
modification or waiver would adversely affect in any material respect any Holder
or group of Holders who have comparable rights under this Agreement
disproportionately to the other Holders having such comparable rights, such
amendment, modification, or waiver shall also require the written consent of the
Holder(s) so adversely affected.

(g) Notices. Any and all
notices or other communications or deliveries required or permitted to be
provided hereunder shall be delivered as set forth in the Subscription
Agreement; provided that the Company may deliver to each Holder the documents
required to be delivered to such Holder under Section 3(a) of this Agreement by
e-mail to the e-mail addresses provided by such Holder to the Company solely for
such specific purpose.

(h) Successors and Assigns.
This Agreement shall inure to the benefit of and be binding upon the successors
and permitted assigns of each of the parties and shall inure to the benefit of
each Holder. Nothing in this Agreement, express or implied, is intended to
confer upon any party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligations, or liabilities under
or by reason of this Agreement, except as expressly provided in this Agreement. The Company may not assign its rights (except
by merger or in connection with another entity acquiring all or substantially
all of the Company’s assets) or obligations hereunder without the prior written
consent of all the Holders of the then outstanding Registrable Securities. Each
Holder may assign its respective rights hereunder in the manner and to the
Persons as permitted under the Subscription Agreement.







(i) Execution and Counterparts. This Agreement may be executed in two or more counterparts, each of
which when so executed shall be deemed to be an original and, all of which taken
together shall constitute one and the same Agreement and shall become effective
when counterparts have been signed by each party and delivered to the other
party, it being understood that both parties need not sign the same counterpart.
In the event that any signature is delivered by facsimile transmission or by
e-mail delivery of a “.pdf” format data file, such signature shall create a
valid and binding obligation of the party executing (or on whose behalf such
signature is executed) with the same force and effect as if such facsimile or
“.pdf” signature were the original thereof.

(j) Governing Law. All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be determined in accordance with the provisions of the
Subscription Agreement.

(k) Cumulative Remedies. The
remedies provided herein are cumulative and not exclusive of any other remedies
provided by law.

(l) Severability. If any term,
provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the parties hereto shall use
their good faith reasonable efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.

(m) Headings. The headings in
this Agreement are for convenience only and shall not limit or otherwise affect
the meaning hereof.







(n) Independent Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under this
Agreement are several and not joint with the obligations of any other Purchaser
hereunder, and no Purchaser shall be responsible in any way for the performance
of the obligations of any other Purchaser hereunder. The decision of each
Purchaser to purchase the Common Shares pursuant to the Transaction Documents
has been made independently of any other Purchaser. Nothing contained herein or
in any other agreement or document delivered at any closing, and no action taken
by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the
Purchasers as a partnership, an association, a joint venture or any other kind
of entity, or create a presumption that the Purchasers are in any way
acting in concert with respect to such obligations or the transactions
contemplated by this Agreement. Each Purchaser acknowledges that no other
Purchaser has acted as agent for such Purchaser in connection with making its
investment hereunder and that no Purchaser will be acting as agent of such
Purchaser in connection with monitoring its investment in the Common Shares or
enforcing its rights under the Transaction Documents. Each Purchaser shall be
entitled to protect and enforce its rights, including, without limitation, the
rights arising out of this Agreement, and it shall not be necessary for any
other Purchaser to be joined as an additional party in any Proceeding for such
purpose. The Company acknowledges that each of the Purchasers has been provided
with the same Registration Rights Agreement for the purpose of closing a
transaction with multiple Purchasers and not because it was required or
requested to do so by any Purchaser.

(o) Effectiveness; Termination. This Agreement shall become automatically effective, without further
action of the parties, upon the Closing. Notwithstanding anything to the
contrary herein, this Agreement shall automatically terminate and be of no
further force and effect immediately upon the termination of the Subscription
Agreement.

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IN WITNESS WHEREOF, the
parties have executed this Registration Rights Agreement as of the date first
written above.

		INDEPENDENCE BANCSHARES, INC.
			 
			 
		By:  	
		Name: Gordon A. Baird
		Title: Chief Executive
  Officer



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SIGNATURE PAGES OF HOLDERS TO FOLLOW]








IN WITNESS WHEREOF, the
parties have executed this Registration Rights Agreement as of the date first
written above.


	[NAME OF INVESTING ENTITY]
	 
	AUTHORIZED SIGNATORY
	 
	By: 	
	Name:
	Title:
		 
	ADDRESS FOR
NOTICE





	c/o 
    	 





	Street 
      	 





	City/State/Zip  	 





	Attention: 
      	 





	Tel: 
    	 





	Fax: 
    	 





	Email: 
      	 










Annex A 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 







PLAN OF DISTRIBUTION


We are registering the
Securities issued to the selling shareholder to permit the resale of these
Securities by the holders of the Securities from time to time after the date of
this prospectus. We will not receive any of the proceeds from the sale by the
selling shareholders of the Securities. We will bear all fees and expenses
incident to our obligation to register the Securities.

The selling shareholders
may sell all or a portion of the Securities beneficially owned by them and
offered hereby from time to time directly or through one or more underwriters,
broker-dealers or agents. If the Securities are sold through underwriters or
broker-dealers, the selling shareholders will be responsible for underwriting
discounts or commissions or agent’s commissions. The Securities may be sold on
any national securities exchange or quotation service on which the securities
may be listed or quoted at the time of sale, in the over-the-counter market or
in transactions otherwise than on these exchanges or systems or in the
over-the-counter market and in one or more transactions at fixed prices, at
prevailing market prices at the time of the sale, at varying prices determined
at the time of sale, or at negotiated prices. These sales may be effected in
transactions, which may involve crosses or block transactions. The selling
shareholders may use any one or more of the following methods when selling
Securities:

	●	
      ordinary brokerage transactions and
      transactions in which the broker-dealer solicits purchasers;
  

	●	
      block trades in which the broker-dealer will
      attempt to sell the shares as agent but may position and resell a portion
      of the block as principal to facilitate the transaction; 

	●	
      purchases by a broker-dealer as principal
      and resale by the broker-dealer for its account; 

	●	
      an exchange distribution in accordance with
      the rules of the applicable exchange; 

	●	
      privately negotiated transactions;
      

	●	
      settlement of short sales entered into after
      the effective date of the registration statement of which this prospectus
      is a part; 

	●	
      broker-dealers may agree with the selling
      shareholders to sell a specified number of such securities at a stipulated
      price per share; 

	●	
      through the writing or settlement of options
      or other hedging transactions, whether such options are listed on an
      options exchange or otherwise; 

	●	
      a combination of any such methods of sale;
      and 

	●	
      any other method permitted pursuant to
      applicable law.



The selling shareholders
also may resell all or a portion of the Securities in open market transactions
in reliance upon Rule 144 under the Securities Act, as permitted by that rule,
or Section 4(a)(1) under the Securities Act, if available, rather than under
this prospectus, provided that they meet the criteria and conform to the
requirements of those provisions.

Broker-dealers engaged by
the selling shareholders may arrange for other broker-dealers to participate in
sales. If the selling shareholders effect such transactions by selling
Securities to or through underwriters, broker-dealers, or agents, such
underwriters, broker-dealers, or agents may receive commissions in the form of
discounts, concessions or commissions from the selling shareholders, or
commissions from purchasers of the Securities for whom they may act as agent
or to whom they may sell as principal. Such
commissions will be in amounts to be negotiated, but, except as set forth in a
supplement to this prospectus, in the case of an agency transaction will not be
in excess of a customary brokerage commission in compliance with FINRA Rule
2121; and in the case of a principal transaction, a markup or markdown in
compliance with FINRA Rule 2121.







In connection with sales of
the Securities or otherwise, the selling shareholders may enter into hedging
transactions with broker-dealers or other financial institutions, which may in
turn engage in short sales of the Securities in the course of hedging in
positions they assume. The selling shareholders may also sell Securities short
and, if such short sale shall take place after the date that this Registration
Statement is declared effective by the Commission, the selling shareholders may
deliver Securities covered by this prospectus to close out short positions and
to return borrowed shares in connection with such short sales. The selling
shareholders may also loan or pledge Securities to broker-dealers that in turn
may sell such shares, to the extent permitted by applicable law. The selling
shareholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).
Notwithstanding the foregoing, the selling shareholders have been advised that
they may not use shares registered on this registration statement to cover short
sales of our Securities made prior to the date the registration statement, of
which this prospectus forms a part, has been declared effective by the
SEC.

The selling shareholders
may, from time to time, pledge or grant a security interest in some or all of
the Securities owned by them and, if they default in the performance of their
secured obligations, the pledgees or secured parties may offer and sell the
Securities from time to time pursuant to this prospectus or any amendment to
this prospectus under Rule 424(b)(3) or other applicable provision of the
Securities Act of 1933, as amended, amending, if necessary, the list of selling
shareholders to include the pledgee, transferee, or other successors in interest
as selling shareholders under this prospectus. The selling shareholders also may
transfer and donate the Securities in other circumstances in which case the
transferees, donees, pledgees, or other successors in interest will be the
selling beneficial owners for purposes of this prospectus.

The selling shareholders
and any broker-dealer or agents participating in the distribution of the
Securities may be deemed to be “underwriters” within the meaning of Section
2(11) of the Securities Act in connection with such sales. In such event, any
commissions paid, or any discounts or concessions allowed, to any such
broker-dealer or agent and any profit on the resale of the shares purchased by
them may be deemed to be underwriting commissions or discounts under the
Securities Act. Selling Shareholders who are “underwriters” within the meaning
of Section 2(11) of the Securities Act will be subject to the applicable
prospectus delivery requirements of the Securities Act and may be subject to
certain statutory liabilities of, including but not limited to, Sections 11, 12,
and 17 of the Securities Act and Rule 10b-5 under the Securities Exchange Act of
1934, as amended, or the Exchange Act.







Each selling shareholder
has informed the Company that it is not a registered broker-dealer and does not
have any written or oral agreement or understanding, directly or indirectly,
with any person to distribute the Securities. Upon the Company being notified in
writing by a selling shareholder that any material arrangement has been entered
into with a broker-dealer for the sale of Securities through a block trade,
special offering, exchange distribution or secondary distribution or a purchase
by a broker or dealer, a supplement to this prospectus will be filed, if
required, pursuant to Rule 424(b) under the Securities Act, disclosing (i) the
name of each such selling shareholder and of the participating broker-dealer(s),
(ii) the number of shares involved, (iii) the price at which such the Securities
were sold, (iv) the commissions paid or discounts or concessions allowed to such
broker-dealer(s), where applicable, (v) that such broker-dealer(s) did not
conduct any investigation to verify the information set out or incorporated by
reference in this prospectus, and (vi) other facts material to the transaction.
In no event shall any broker-dealer receive fees, commissions and markups,
which, in the aggregate, would exceed eight percent (8%).

Under the securities laws
of some states, the Securities may be sold in such states only through
registered or licensed brokers or dealers. In addition, in some states the
Securities may not be sold unless such shares have been registered or qualified
for sale in such state or an exemption from registration or qualification is
available and is complied with.

There can be no assurance
that any selling shareholder will sell any or all of the Securities registered
pursuant to the shelf registration statement, of which this prospectus forms a
part.

Each selling shareholder
and any other person participating in such distribution will be subject to
applicable provisions of the Securities Exchange Act of 1934, as amended, and
the rules and regulations thereunder, including, without limitation, to the
extent applicable, Regulation M of the Exchange Act, which may limit the timing
of purchases and sales of any of the Securities by the selling shareholder and
any other participating person. To the extent applicable, Regulation M may also
restrict the ability of any person engaged in the distribution of the Securities
to engage in market-making activities with respect to the Securities. All of the
foregoing may affect the marketability of the Securities and the ability of any
person or entity to engage in market-making activities with respect to the
Securities.

We will pay all expenses of
the registration of the Securities pursuant to the registration rights
agreement, including, without limitation, Securities and Exchange Commission
filing fees and expenses of compliance with state securities or “blue sky” laws;
provided, that each selling shareholder will pay all underwriting discounts and
selling commissions, if any, and any related legal fees and expenses incurred by
it. We will indemnify the selling shareholders against certain liabilities,
including some liabilities under the Securities Act, in accordance with the
registration rights agreement, or the selling shareholders will be entitled to
contribution. We may be indemnified by the selling shareholders against civil
liabilities, including liabilities under the Securities Act, that may arise from
any written information furnished to us by the selling shareholders specifically
for use in this prospectus, in accordance with the related registration rights
agreements, or we may be entitled to contribution.







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Annex B 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 







INDEPENDENCE BANCSHARES,
INC. 

SELLING SHAREHOLDER
NOTICE AND QUESTIONNAIRE 

The undersigned holder of
securities of Independence Bancshares, Inc. d/b/a nD bancgroup, a South Carolina
corporation (the “Company”), issued
pursuant to a Subscription Agreement by and among the Company and the Purchasers
named therein, dated January __, 2015, understands that the Company intends to
file with the Securities and Exchange Commission a registration statement on
Form S-1 (the “Resale Registration Statement”) for the registration and the
resale under Rule 415 of the Securities Act of 1933, as amended (the “Securities
Act”), of the Registrable Securities in accordance with the terms of a certain
Registration Rights Agreement by and among the Company and the Purchasers named
therein, dated as of January __, 2015 (the “Agreement”). All capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Agreement.

In order to sell or
otherwise dispose of any Registrable Securities pursuant to the Resale
Registration Statement, a holder of Registrable Securities generally will be
required to be named as a selling shareholder in the related prospectus or a
supplement thereto (as so supplemented, the “Prospectus”), deliver the Prospectus to purchasers of
Registrable Securities (including pursuant to Rule 172 under the Securities
Act), and be bound by the provisions of the Agreement (including certain
indemnification provisions, as described below). Holders must complete and
deliver this Notice and Questionnaire in order to be named as selling
shareholders in the Prospectus. Holders of Registrable Securities who do not
complete, execute, and return this Notice and Questionnaire within 10 Business
Days following the date of the Agreement (1) will not be named as selling
shareholders in the Resale Registration Statement or the Prospectus and (2) may
not use the Prospectus for resales of Registrable Securities.

Certain legal consequences
arise from being named as a selling shareholder in the Resale Registration
Statement and the Prospectus. Holders of Registrable Securities are advised to
consult their own securities law counsel regarding the consequences of being
named or not named as a selling shareholder in the Resale Registration Statement
and the Prospectus.

NOTICE 

The undersigned holder (the
“Selling
Shareholder”) of Registrable
Securities hereby gives notice to the Company of its intention to sell or
otherwise dispose of Registrable Securities owned by it and listed below in Item
(3), unless otherwise specified in Item (3), pursuant to the Resale Registration
Statement. The undersigned, by signing and returning this Notice and
Questionnaire, understands and agrees that it will be bound by the terms and
conditions of this Notice and Questionnaire and the Agreement.

The undersigned hereby
provides the following information to the Company and represents and warrants
that such information is accurate and complete:







QUESTIONNAIRE


	1.	       	Name.
					 
			(a)		Full Legal Name
      of Selling Shareholder:
					 
			(b)		Full Legal Name
      of Registered Holder (if not the same as (a) above) through which
      Registrable Securities Listed in Item 3 below are held:
					 
	 
			(c)	 	Full Legal Name
      of Natural Control Person (which means a natural person who directly or
      indirectly alone or with others has power to vote or dispose of the
      securities covered by the questionnaire):
		 			
					 
	2.		Address for Notices to Selling
      Shareholder:



	 
	 
	 
	Telephone:      
      	 
	Fax:	


	Contact
      Person:       	 


	E-mail address of
      Contact Person:       	 



	3.	       	Beneficial Ownership of Registrable Securities Issuable Pursuant to
      the Subscription Agreement:
	 
			(a)	 	Type and
      Number of Registrable Securities beneficially owned and issued pursuant to
      the Agreement:
					 
					 
					 
					 
	 
			(b)		Number of
      Securities to be registered pursuant to this Notice for
  resale:
					 
					 
					 
					 










4.       Broker-Dealer Status:


	(a)		Are you a broker-dealer?	
	 			
			Yes ☐	No ☐
	 
	(b)		If “yes” to
      Section 4(a), did you receive your Registrable Securities as compensation
      for investment banking services to the Company?
	 			
			Yes ☐	No ☐
	 
	Note: If no, the
      Commission’s staff has indicated that you should be identified as an
      underwriter in the Registration Statement.
	 	
	(c)		Are you an affiliate of a
      broker-dealer?	
	 			
			Yes ☐	No ☐
	 
	Note: If yes,
      provide a narrative explanation below:	
			 
	(d)	 	If you are an affiliate of a
      broker-dealer, do you certify that you bought the Registrable Securities
      in the ordinary course of business, and at the time of the purchase of the
      Registrable Securities to be resold, you had no agreements or
      understandings, directly or indirectly, with any person to distribute the
      Registrable Securities?
			
			
			
				
			Yes ☐	No ☐



Note: If no, the
Commission’s staff has indicated that you should be identified as an underwriter
in the Registration Statement.



	5.	       	Beneficial Ownership of Other Securities of the
      Company Owned by the Selling Shareholder.
	 
			Except as set forth below in this Item 5, the
      undersigned is not the beneficial or registered owner of any securities of
      the Company other than the Registrable Securities listed above in Item
      3.
	 
			Type and amount
      of other securities beneficially owned:
	 	 	 
	 	 	 
	 	 	 









	6.	       	Relationships with the Company:
	 
			Except as set forth below, neither the undersigned nor
      any of its affiliates, officers, directors or principal equity holders
      (owners of 5% of more of the equity securities of the undersigned) has
      held any position or office or has had any other material relationship
      with the Company (or its predecessors or affiliates) during the past three
      years.
	 
			State any
      exceptions here:



			 
			 
			 
			 
	7.	       	Plan of Distribution:
	 
			The undersigned has reviewed the form of Plan
      of Distribution attached as Annex A to the
      Registration Rights Agreement, and hereby confirms that, except as set
      forth below, the information contained therein regarding the undersigned
      and its plan of distribution is correct and
    complete.
	 
			State any
      exceptions here:
			 
 
			 
			 



***********

By signing below, the
undersigned consents to the disclosure of the information contained herein in
its answers to Items (1) through (7) above and the inclusion of such information
in the Resale Registration Statement and the Prospectus. The undersigned
understands that such information will be relied upon by the Company in
connection with the preparation or amendment of any such Registration Statement
and the Prospectus. The undersigned will immediately notify the Company of any
inaccuracies in the information disclosed in this Questionnaire.

By signing below, the
undersigned acknowledges that it understands its obligation to comply, and
agrees that it will comply, with the provisions of the Exchange Act and the
rules and regulations thereunder, particularly Regulation M in connection with
any offering of Registrable Securities pursuant to the Resale Registration
Statement. The undersigned also acknowledges that it understands that the
answers to this Questionnaire are furnished for use in connection with
Registration Statements filed pursuant to the Registration Rights Agreement and
any amendments or supplements thereto filed
with the Commission pursuant to the Securities Act.







I confirm that, to the best
of my knowledge and belief, the foregoing statements (including without
limitation the answers to this Questionnaire) are correct.

IN WITNESS WHEREOF the
undersigned, by authority duly given, has caused this Questionnaire to be
executed and delivered either in person or by its duly authorized
agent.

	Dated: 
      	 	 


	Beneficial
      Owner:  	 	 


	By: 
    	 	 


	Name: 
      	 	 


	Title: