Document:

Exhibit 10.9

 

THIS
CONVERTIBLE PROMISSORY NOTE AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
NO SALE OR DISPOSITION MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH RULE 144 UNDER SAID ACT OR AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO OR AN OPINION OF COUNSEL FOR THE HOLDER SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER
THE ACT OR RECEIPT OF A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION.

 

CONVERTIBLE
PROMISSORY NOTE

 

	$500,000	January
    18, 2019

 

For
value received OWP VENTURES, INC., a Delaware corporation (the “Company”)
promises to pay to the order of The Sanguine Group LLC. (“Holder”) the principal sum of FIVE
HUNDRED THOUSAND DOLLARS (500,000.00), with interest on the outstanding principal amount at the rate of six percent (6%) per
annum, on January 18, 2022 (the Maturity Date”). Interest shall commence with the date hereof and shall
accrue on the outstanding principal amount until paid in full or this Note has been converted as provided below. Interest shall
be computed on the basis of a year of 365 days for the actual number of days elapsed.

 

1. All
payments of interest and principal shall be in lawful money of the United States of America. All payments shall be applied
first to accrued interest, and thereafter to principal.

 

2.(a)In
the event that the Company consummates the closing of a public or private offering of its Equity Securities (as defined below)
resulting in gross proceeds to the Company of at least $500,000 (excluding the conversion this Note) (a “Qualified
Financing”) at any time prior to the repayment of this Note, then the outstanding principal balance of this Note,
together with any accrued and unpaid interest thereon, or any portion thereof, shall automatically be converted into such Equity
Securities at the lower of a conversion price (i) equal to eighty percent (80%) of the purchase price paid by the investors purchasing
the Equity Securities in the Qualified Financing, or (ii) reflecting a price per share of common stock of the Company of $0.424
per share, as equitably adjusted for any stock split or stock dividends effected after the date hereof (the “Fixed
Conversion Price”). For purposes of this Note, the term “Equity Securities” shall mean
(i) any shares of common stock or preferred stock of the Company, (ii) any security convertible or exchangeable for common stock
or preferred stock of the Company, and (iii) any other rights to purchase or otherwise acquire common stock or preferred
stock of the Company, in each case issued in a Qualified Financing following the date hereof, except that Equity Securities shall
not include any security granted, issued and/or sold by the Company to any officer, employee, director, advisor or consultant
in such capacity.

 

(b)
In case of any reorganization, consolidation or merger involving the Company prior to the Maturity Date, in which the
stockholders of the Company receive securities of another entity (including any parent company of the company with which the
Company merges or is merged into) (the “Successor Issuer”) in exchange for their shares of Company common
stock, this Note shall automatically be converted into that number of shares of common stock of the Successor Issuer as the
Holder would have been entitled to receive upon consummation of such event, if the Holder had converted all of the principal
and interest outstanding under this Note immediately prior thereto at the Fixed Conversion Price.

 

     

     

    

 

(c)
In the event the Company fails to pay the outstanding obligations under this Note on the Maturity Date, Holder shall
thereafter have the option at any time and from time to time, prior to the date on which the Company makes payment in full of
the outstanding principal amount of this Note together with all accrued interest thereon, to convert all or any portion of
the outstanding principal amount of this Note plus all accrued and unpaid interest thereon into common stock of the Company
at the Fixed Conversion Price.

 

(d)
Before the Holder shall be entitled to convert this Note into Equity Securities pursuant to this Section 2, the Holder shall
give written notice to the Company at its principal corporate office, of the election to convert the same and shall state
therein the name or names in which the Equity Securities are to be issued. The Company shall, as soon as practicable
thereafter, issue and deliver to Holder or to the nominee or nominees of Holder, a certificate or certificates for the Equity
Securities to which the Holder shall be entitled as aforesaid. Conversion shall be deemed to have been effected on the date
when delivery of notice of an election to convert and surrender of the Note to be converted is made, or if applicable, on the
effective date of the Qualified Financing. All Equity Securities which may be issued upon conversion of the Note will, upon
issuance, be duly issued, fully paid and non-assessable and free from all taxes, liens, and charges with respect to the
issuance thereof.

 

(e)
Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert this Note if as a
result thereof the Holder would beneficially own in excess 4.99% or more of the outstanding shares of common stock of the
Company or a Successor Issuer, as applicable, at any time that such common stock is registered under Section 12 of the
Securities Exchange Act of 1934, as amended (the “1934 Act”). For the purposes of the immediately
preceding sentence, beneficial ownership shall be determined in accordance with Section 13(c) of the of the 1934 Act and
Regulation 13d-3 thereunder. The Holder may void the limitation described in this 2(e) upon 65 days prior notice to the
Company.

 

3. By
its acceptance of this Note, the Holder makes the following representations and warrantees:

 

(a)
The Holder represents and warrants that it is acquiring this Note and will acquire any Equity Securities on conversion of
this Note solely for its account for investment and not with a view to or for sale or distribution of the Note or Equity
Securities or any part thereof. The Holder also represents that the entire legal and beneficial interests of the Note and
Equity Securities the Holder is acquiring is being acquired for, and will be held for, its account only.

 

(b)
The Holder understands that the Note and Equity Securities have not been registered under the Securities Act of 1933, as
amended (the “Act”) on the basis that no distribution or public offering of the stock of the Company is to
be effected. The Holder realizes that the basis for the exemption may not be present if, notwithstanding its representations,
the Holder has a present intention of acquiring the securities for a fixed or determinable period in the future, selling (in
connection with a distribution or otherwise), granting any participation in, or otherwise distributing the securities. The
Holder has no such present intention.

 

    2

     

    

 

(c)
The Holder recognizes that the Note and Equity Securities must be held indefinitely unless they are subsequently registered
under the Act or an exemption from such registration is available. The Holder recognizes that the Company has no obligation
to register the Note or Equity Securities, or to comply with any exemption from such registration.

 

(d)
The Holder is aware that neither the Note nor the Equity Securities may be sold pursuant to Rule 144 adopted under the Act
unless certain conditions are met, including, among other things, the existence of a public market for the shares, the
availability of certain current public information, the resale following the required holding period under Rule 144 and the
number of shares being sold during any three month period not exceeding specified limitations. The Holder is aware that the
conditions for resale set forth in Rule 144 have not been satisfied and that the Company presently has no plans to satisfy
these conditions in the foreseeable future.

 

4. This
Note may be prepaid at any time without the consent of the Holder.

 

5. The
Company shall pay all reasonable attorneys’ fees and court costs incurred by the Holder in enforcing and collecting
this Note.

 

6. The
Company hereby waives demand, notice, presentment, protest and notice of dishonor.

 

7. This
Note shall be governed by and construed under the laws of the State of Nevada, as applied to agreements among Nevada
residents, made and to be performed entirely within the State of Nevada, without giving effect to conflicts of laws
principles.

 

8. This
Note may be transferred only upon its surrender to the Company for registration of transfer, duly endorsed, or accompanied
by a duly executed written instrument of transfer in form satisfactory to the Company. Thereupon, this Note shall be reissued
to, and registered in the name of, the transferee, or a new Note for like principal amount and interest shall be issued to,
and registered in the name of, the transferee. Interest and principal shall be paid solely to the registered holder of this
Note. Such payment shall constitute full discharge of the Company’s obligation to pay such interest and
principal.

 

	 	OWP
    VENTURES, INC.
	 	 	 
	 	By:	/s/
    Craig Ellins
	 	 	Name:
    Craig Ellins
	 	 	Title:
    Chief Executive Officer

 

 

3Exhibit

EXHIBIT 10.1

BANK OF HAWAII CORPORATION 
2014 STOCK AND INCENTIVE PLAN 
 
RESTRICTED STOCK GRANT AGREEMENT (PERFORMANCE BASED) 
(FEBRUARY 22, 2019)
This Restricted Stock Grant Agreement (“Agreement”) dated February 22, 2019 (“Grant Date”), between Bank of Hawaii Corporation, a Delaware corporation (“Company”), with its registered office at 130 Merchant Street, Honolulu, Hawaii 96813, and the executive of the Company or subsidiary of the Company (“Grantee”) who as of the Grant Date is an Eligible Person under the Bank of Hawaii Corporation 2014 Stock and Incentive Plan (“Plan”) and who is specified in the “Notice of 2019 Restricted Stock Grant (Performance Based)” (“Notice”) attached hereto.
1.Grant of Restricted Shares.  Effective as of the Grant Date, the Human Resources and Compensation Committee of the Company’s Board of Directors (“Committee”) has granted to Grantee the number of shares of Restricted Stock (“Restricted Shares”) as specified in the Notice pursuant to the Plan.  Forty-five percent (45%) of the Restricted Shares are hereby designated as “First Category Shares”, forty-five percent (45%) as “Second Category Shares”, and ten percent (10%) as “Third Category Shares”.
2.Restrictions During Period of Restriction.  The given category of Restricted Shares shall be subject to forfeiture by Grantee and shall be nontransferable until the “Period of Restriction” terminates as to such Restricted Shares.  The Restricted Shares shall vest in Grantee upon termination of the Period of Restriction (to the extent that the Restricted Shares have not previously been forfeited).  For purposes of this Agreement, the term “Period of Restriction” shall mean the period that commences on the Grant Date and terminates on the date of certification of achievement of service and financial performance objectives by the Committee (“Date of Certification”), as described in Section 2.e below (or which Period of Restriction otherwise terminates as provided in Section 2.d below).  In the event the Committee's certification is completed after the close of the New York Stock Exchange on the actual date of such certification (i.e., the date of the Committee meeting), the Date of Certification shall be deemed to be, and the Period of Restriction shall instead terminate, on the next business day.  

1.
4831-2908-2205.2 
        

As described below, the Period of Restriction shall terminate based upon the level of achievement of specified financial performance criteria, where the First Category Shares shall be conditioned upon “Return on Equity”, the Second Category Shares shall be conditioned upon “Stock Price to Book Ratio”, and the Third Category Shares shall be conditioned upon “Tier 1 Capital Ratio” (“Financial Performance Criteria”).  In this regard, the Period of Restriction shall terminate with respect to the “Applicable Vesting Percentage” of the First Category Shares and Second Category Shares, as the case may be, based upon the Company’s achievement of the respective Financial Performance Criteria in accordance with the following schedule:
	
		
	Return on Equity and Stock Price to Book Ratio

	Financial Performance Criteria-- 
Three Year Average Percentile Rank
	Applicable Vesting 
Percentage

	75th and Above (Maximum)
	100%

	62.5th – 74.9th
	75%

	50th - 62.49th
	50%

	Below 50th
	0%

Further, the Period of Restriction shall terminate with respect to the “Applicable Vesting Percentage” of the Third Category Shares based upon the Company’s achievement of the respective Financial Performance Criteria in accordance with the following schedule:
	
		
	Tier 1 Capital Ratio

	Financial Performance Criteria-- 
Three Year Average Percentile Rank
	Applicable Vesting 
Percentage

	50th and Above (Maximum)
	100%

	Below 50th
	0%

For purposes of this Agreement, the terms “Return on Equity”, “Stock Price to Book Ratio”, and “Tier 1 Capital Ratio” (as defined by the Federal Reserve Bank) shall mean such terms as determined for the banks that comprise the S&P Supercomposite Regional Bank Index (where for the applicable year, Return on Equity shall be measured as of December 31 of such year, Tier 1 Capital Ratio shall be measured as of September 30 of such year, and Stock Price to Book Ratio shall be measured based on stock price as of December 31 and book value as of September 30 of such year).  With respect to the given Financial Performance Criteria, the “Three Year Average Percentile” shall mean the Company’s percentile level on the S&P Supercomposite Regional Bank Index for the average of the numerical measures over the three years 2019, 2020, and 2021.  The Financial Performance Criteria shall be determined based on references to measures and percentiles for the peer group banks that comprise the January 2, 2019, S&P Supercomposite Regional Bank Index (with peer group banks determined by excluding banks with assets >$50B).
a.Termination of Period of Restriction For First Category Shares
The Period of Restriction shall terminate with respect to the amount equal to the Applicable Vesting Percentage multiplied by the First Category Shares, provided that:  (i) the Committee shall have certified the Three Year Average Percentile level for the Company’s “Return on Equity” that corresponds to such Applicable Vesting Percentage; and (ii) Grantee is an Employee on the Date of Certification.

2.

b.Termination of Period of Restriction Second Category Shares
The Period of Restriction shall terminate with respect to the amount equal to the Applicable Vesting Percentage multiplied by the Second Category Shares, provided that:  (i) the Committee shall have certified the Three Year Average Percentile level for the Company’s “Stock Price to Book Ratio” that corresponds to such Applicable Vesting Percentage; and (ii) Grantee is an Employee on the Date of Certification.
c.Termination of Period of Restriction Third Category Shares
The Period of Restriction shall terminate with respect to the amount equal to the Applicable Vesting Percentage multiplied by the Third Category Shares, provided that:  (i) the Committee shall have certified the Three Year Average Percentile level for the Company’s “Tier 1 Capital Ratio” that corresponds to such Applicable Vesting Percentage; and (ii) Grantee is an Employee on the Date of Certification.
d.Termination of Period of Restriction Upon Certain Terminations of Employment
In addition to the termination of the Period of Restriction based on the achievement of the service and financial performance objectives as described in Sections 2.a-2.c above, the Period of Restriction shall terminate in connection with certain terminations of Grantee’s employment with the Company and its subsidiaries as described in this Section 2.d.  Specifically, the Period of Restriction for all of the Restricted Shares shall terminate (to the extent that the Period of Restriction has not previously terminated or the Restricted Shares have not previously been forfeited) upon the occurrence of any of the following: (i) the death of Grantee; (ii) the Grantee ceasing to be an Employee due to “disability” within the meaning of that term under Section 409A of the Internal Revenue Code of 1986, as amended (“Code”) and the regulations promulgated thereunder; or (iii) upon or after the occurrence of a “Change in Control” (within the meaning of Section 2.5 of the Bank of Hawaii Corporation Change-in-Control Retention Plan, restatement effective December 17, 2009 (“Change-in-Control Plan”)) either (A) Grantee’s employment with the Company and its subsidiaries is terminated by the Company without “Cause” (within the meaning of Section 2.4 of the Change-in-Control Plan) or (B) Grantee terminates employment with the Company and its subsidiaries for “Good Reason” (within the meaning of Section 2.15 of the Change-In-Control Plan).
e.Committee Determinations.  The Committee shall certify whether the Financial Performance Criteria for the First Category Shares, Second Category Shares, and Third Category Shares have been achieved as soon as administratively practicable following the completion of the three year performance period ending December 31, 2020.  To the extent that the satisfaction of the Financial Performance Criteria is certified, the Restricted Shares subject to vesting shall vest on the Date of Certification (i.e., the Period of Restriction shall be terminated on the Date of Certification).

3.

1.Forfeiture of Unvested Restricted Shares.  Restricted Shares as to which the Period of Restriction has not terminated shall be forfeited and transferred to the Company upon the first to occur of: (a) Grantee’s ceasing to be an Employee for any reason, whether voluntary or involuntary (other than for a termination of employment described in Section 2.d), and (b) the date the Committee determines the Financial Performance Criteria were not met (to the extent that the Restricted Shares do not become vested based on the Applicable Vesting Percentages).  However, as described in Section 2 above with respect to the termination of the Period of Restriction on the Date of Certification, the Applicable Vesting Percentage of the given category of Restricted Shares shall not be forfeited, to the extent that:  (a) with respect to such Applicable Vesting Percentage of such category of Restricted Shares, the Committee has certified that the corresponding Three Year Average Percentile level for such Applicable Vesting Percentage has been achieved; and (b) the Grantee is an Employee on the Date of Certification.  Grantee’s employment shall not be treated as terminated in the case of a transfer of employment within the Company and its subsidiaries or in the case of sick leave and other approved leaves of absence.
2.Issuance of Shares; Registration; Withholding Taxes.  Restricted Shares shall be issued in Grantee’s name, shall bear the restrictive legends as are required or deemed advisable by the Company under the provisions of any applicable law, and shall be held by the Company until all restrictions lapse or such shares are forfeited as provided herein.  The Company may postpone the issuance or delivery of the Shares until (a) the completion of registration or other qualification of such Shares or transaction under any state or federal law, rule or regulation, or any listing on any securities exchange, as the Company shall determine to be necessary or desirable; (b) the receipt by the Company of such written representations or other documentation as the Company deems necessary to establish compliance with all applicable laws, rules and regulations, including applicable federal and state securities laws and listing requirements, if any; and (c) the payment to the Company of any amount required by the Company to satisfy any federal, state or other governmental withholding tax requirements related to the issuance or delivery of the Shares.  Grantee shall comply with any and all legal requirements relating to Grantee’s resale or other disposition of any Shares acquired under this Agreement.
3.Share Adjustments.  The number and kind of Restricted Shares or other property subject to this Agreement shall be subject to adjustment in accordance with Section 13 of the Plan.
4.Rights as Shareholder.  Unless otherwise provided herein, Grantee shall be entitled to all of the rights of a shareholder with respect to the Restricted Shares, including the right to vote such Shares and to receive dividends and other distributions (not including share adjustments as described in Section 5 above) payable with respect to such Shares from and after the Grant Date.  Grantee’s rights as a shareholder shall terminate with respect to any Restricted Shares forfeited by Grantee.
5.Employment Rights.  Neither the Plan nor the granting of the Restricted Shares shall be a contract of employment of Grantee by the Company or any of its subsidiaries.  Grantee may be discharged from employment at any time by the employing Company or subsidiary, subject to any employment contract that may otherwise apply to Grantee.

4.

6.Amendment.  This Agreement may be amended by the Committee at any time based on its determination that the amendment is necessary or advisable in light of any addition to, or change in, the Code or regulations issued thereunder or any federal or state securities law or other law or regulation, or the Plan, or based on any discretionary authority of the Committee under the Plan.  Unless necessary or advisable due to a change in law, any amendment to this Agreement which has a material adverse effect on the interest of Grantee under this Agreement shall be adopted only with the consent of Grantee.
7.Section 83(b) Election.  Grantee shall promptly deliver to the Company a copy of any election filed by Grantee in respect of the Restricted Shares pursuant to Code Section 83(b).
8.Notices.  Any notice or other communication made in connection with this Agreement shall be deemed duly given when delivered in person or mailed by certified or registered mail, return receipt requested, to Grantee at Grantee’s address shown on Company records or such other address designated by Grantee by similar notice, or to the Company at its then principal office, to the attention of the Corporate Secretary of the Company.  Furthermore, such notice or other communication shall be deemed duly given when transmitted electronically to Grantee at Grantee’s electronic mail address shown on the Company records or, to the extent that Grantee is an active employee, through the Company’s intranet.
9.Plan Governs.  The Restricted Shares evidenced by this Agreement are subject to the terms and conditions of the Plan and of this Agreement.  In case of conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall control.  Capitalized terms used in this Agreement and not defined herein shall have the meaning assigned in the Plan unless the context indicates otherwise.
10.Miscellaneous.  This Agreement shall bind and benefit Grantee, the heirs, distributees and personal representative of Grantee, and the Company and its successors and assigns.  This Agreement may be signed in counterparts, each of which shall be deemed an original, and said counterparts shall together constitute one and the same instrument.  Capitalized terms not herein defined shall have the meanings prescribed to them under the Plan.

5.

BY ACCEPTING THE RESTRICTED SHARES GRANTED UNDER THIS RESTRICTED STOCK GRANT AGREEMENT, GRANTEE AGREES TO ALL THE TERMS AND CONDITIONS DESCRIBED IN THIS AGREEMENT AND IN THE PLAN.
IN WITNESS WHEREOF, the Company has caused this Agreement to be signed on its behalf by the undersigned, thereunto duly authorized, effective as of the Date of Grant.

	
		
	 
	BANK OF HAWAII CORPORATION 
 
 
 
By ____________________________________ 
      MARK A. ROSSI 
      Its Vice Chairman 
   “Company”

	 
	Agreed and Accepted: 
 
 
 
_______________________________________ 
 
   “Grantee”

6.

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