Attached files
| file | filename |
|---|---|
| 8-K - Saint James CO | v165179_8k.htm |
| EX-2.1 - Saint James CO | v165179_ex2-1.htm |
| EX-10.2 - Saint James CO | v165179_ex10-2.htm |
| EX-99.1 - Saint James CO | v165179_ex99-1.htm |
| EX-10.8 - Saint James CO | v165179_ex10-8.htm |
| EX-10.6 - Saint James CO | v165179_ex10-6.htm |
| EX-10.9 - Saint James CO | v165179_ex10-9.htm |
| EX-99.2 - Saint James CO | v165179_ex99-2.htm |
| EX-10.7 - Saint James CO | v165179_ex10-7.htm |
| EX-10.1 - Saint James CO | v165179_ex10-1.htm |
| EX-10.4 - Saint James CO | v165179_ex10-4.htm |
| EX-10.3 - Saint James CO | v165179_ex10-3.htm |
THE
SAINT JAMES COMPANY
REGISTRATION
RIGHTS AGREEMENT
This
Registration Rights Agreement dated as of October ___, 2009 (this “Agreement”),
is entered into by and among THE SAINT JAMES COMPANY, a North Carolina
corporation (the “Company”), and SAPHIRE ADVISORS, LLC, a Delaware limited
liability company (“Shareholder”).
WHEREAS, pursuant to that certain
Membership Interest Purchase Agreement (the “Purchase Agreement”), dated as of
October __, 2009, by and among Shareholder, The Saint James Eos Wine Company, a
California corporation (the “Purchaser”), and the Company, the Company
agreed: (i) to issue 2,500,000 restricted shares of Saint James Stock
to Shareholder; and (ii) upon conversion of the Note, to issue the Conversion
Stock to Shareholder (Capitalized terms not otherwise defined herein shall have
the meaning set forth in the Purchase Agreement).
NOW,
THEREFORE, in consideration of the foregoing, and of the mutual representations,
covenants and agreements set forth in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
Section
1. Definitions.
1.1. As
used in this Agreement, the following terms shall have the following
meanings:
“Affiliate” means,
with respect to any Person, any entity controlling, controlled by or under
common control with such designated Person. For the purposes of this
definition, “control” shall have the meaning specified as of the date of this
Agreement for that word in Rule 405 promulgated by the Commission under the
Securities Act.
“Commission” means the
Securities and Exchange Commission, and any successor thereto.
“Exchange Act” means
the Securities Exchange Act of 1934, as amended.
“Person” means an
individual, partnership, corporation, business trust, limited liability company,
joint stock company, trust, unincorporated association, joint venture, or other
entity of whatever nature.
“Register,” “Registered” and
“Registration”
means a Registration effected by preparing and filing a Registration statement
in compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such Registration statement by the Commission, with such
effectiveness continuing for not less than 36 consecutive calendar days (or such
shorter period as will terminate when all Registrable Stock shall have been sold
or withdrawn).
“Rule 144” means Rule
144 promulgated by the Commission under the Securities Act, as such rule may be
amended from time to time, or any successor Rule thereto.
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“Securities” means any
debt or equity securities of the Company, whether now or hereafter authorized,
and any instrument convertible into, or exercisable or exchangeable for,
Securities or a Security.
“Securities Act” means
the Securities Act of 1933, as amended.
Section
2. Registration. The
Company shall use its diligent efforts (a) to file a Registration statement
under the Securities Act as soon as practicable, and in any event within sixty
(60) days following the Closing Date, and (b) to effect the Registration under
the Securities Act of: (i) the 2,500,000 restricted shares of Saint
James Stock issued to Shareholder pursuant to the Asset Purchase Agreement; (ii)
the Earnout Stock; and (iii) 120% of the amount of Conversion Stock, which would
be issued if all of the indebtedness outstanding under the Note on the Closing
Date were converted into Conversion Stock as of such date, all to the extent
requisite to permit disposition by Shareholder and their affiliates
(collectively, the “Registrable Stock”) in accordance with the intended methods
of disposition described on Schedule 1 attached
hereto.
Section
3. Registration
Procedures.
3.1. The
Company will, as expeditiously as reasonably possible:
(a) before
filing each Registration statement or prospectus or amendment or supplement
thereto with the Commission, furnish counsel for the Shareholder with copies of
all such documents (other than exhibits thereto) proposed to be filed, which
shall be subject to the prompt, reasonable approval of such
counsel;
(b) prepare
and file with the Commission a Registration statement with respect to such
Registrable Stock and use its diligent efforts to cause such Registration
statement to become effective as soon as practicable after filing;
(c) prepare
and file with the Commission such amendments and supplements to such
Registration statement and the prospectus used in connection therewith as may be
necessary to keep such Registration statement effective and to comply with the
provisions of the Securities Act with respect to the sale or other disposition
of all Registrable Stock covered by such Registration statement in accordance
with the intended methods of disposition set forth in such Registration
statement;
(d) prepare
and promptly file with the Commission, and notify Shareholder immediately after
the filing of, such amendment or supplement to such Registration statement or
prospectus as may be necessary to correct any statements or omissions if any
event shall have occurred as the result of which any such Registration statement
or prospectus would include an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the light
of the circumstances in which they were made, not misleading, and notify
Shareholder immediately after its discovery of such event;
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(e) furnish
to the underwriters and Shareholder such numbers of copies of such Registration
statement, each amendment and supplement thereto, the prospectus included in
such Registration statement (including each preliminary prospectus) and such
other documents as such underwriters or Shareholder may reasonably request
(including legal opinions and accountant comfort letters) in order to facilitate
the disposition of the Registrable Stock subject to such Registration statement
in accordance with such Registration statement;
(f) use
its diligent efforts to Register or qualify any Registrable Stock covered by
such Registration statement under the securities or blue sky laws of such
jurisdictions within the United States of America as Shareholder or the
underwriters reasonably request, and to take any other acts which Shareholder or
the underwriters may reasonably request under such securities or blue sky laws
to enable the consummation of the disposition in such jurisdictions of such
Registrable Stock (provided, however, that the Company may not be required under
this Agreement (i) to qualify generally to do business as a foreign corporation
in any jurisdiction in which it would not otherwise be required to qualify, or
(ii) to subject itself to taxation in any such jurisdiction, or (iii) to consent
to general service of process in any such jurisdiction);
(g) provide
a transfer agent and registrar for all Registrable Stock sold under the
Registration not later than the effective date of the Registration
statement;
(h) use
all diligent efforts to cause any stop order that may be issued to be withdrawn
promptly;
(i) enter
into such customary agreements (including underwriting agreements in customary
form) and take all such other actions as the underwriters, if any, or any
Shareholder reasonably requests in order to expedite or facilitate the
disposition of such Registrable Stock, provided that in no event shall the
indemnification or contribution obligations of the Company contained in any such
agreement be greater than the obligations set forth in Section 5;
(j) make
available for inspection by Shareholder, any underwriter participating in any
disposition pursuant to such Registration statement, and any attorney,
accountant or other agent retained by Shareholder or underwriter, all financial
and other records, pertinent corporate documents and properties of the Company,
and cause the Company’s officers, directors, employees and independent
accountants to supply all information reasonably requested by Shareholder or
underwriter in connection with such Registration statement, all subject to such
limitations as the Company reasonably deems appropriate in order to protect the
Company’s confidential or proprietary information; and
(k) use
diligent efforts to cause Registrable Stock to be designated or listed for
trading in the same manner as similar securities issued by the Company are then
designated or listed on each inter-dealer quotation system of which any of the
Company’s securities are then quoted.
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3.2 Shareholder
agrees as follows:
(a) Shareholder
shall cooperate as reasonably requested by the Company with the Company in
connection with the preparation of the Registration statement, and for so long
as the Company is obligated to file and keep effective the Registration
statement, shall provide to the Company, in writing, for use in the Registration
statement, all such information and undertakings as it may reasonably request
regarding Shareholder (and its direct and indirect members) and their plan of
distribution of the Registrable Stock to enable the Company to prepare the
Registration statement and prospectus covering the Registrable Stock, to
maintain the currency and effectiveness thereof and otherwise to comply with all
applicable requirements of law in connection therewith.
(b) During
such time as Shareholder may be engaged in a distribution of the Registrable
Stock, Shareholder shall comply with Regulation M promulgated under the Exchange
Act and pursuant thereto it shall, among other things: (i) not engage
in any stabilization activity in connection with the securities of the Company
in contravention of such regulation; (ii) distribute the Registrable Stock under
the Registration statement solely in the manner described in the Registration
statement; and (iii) cease distribution of such Registrable Stock pursuant to
such Registration statement upon receipt of written notice from the Company that
the prospectus covering the Registrable Stock contains any untrue statement of a
material fact or omits a material fact required to be stated therein or
necessary to make the statements therein not misleading.
(c) Shareholder,
by execution of this Agreement, agrees: (i) that upon receipt of any
written notice from the Company, Shareholder will forthwith discontinue its
disposition of Registrable Stock pursuant to the Registration statement relating
to such Registrable Stock until the receipt by Shareholder of the copies of the
supplemented or amended prospectus contemplated by Section 3.1(e) and, if so
directed by the Company, will deliver to the Company all copies other than
permanent file copies, then in possession of Shareholder of the prospectus
relating to such Registrable Stock current at the time of receipt of
such notice; and (ii) that it will immediately notify the Company, at any time
when a prospectus relating to the registration of such Registrable Stock is
required to be delivered under the Securities Act, of the happening of any event
as a result of which information previously furnished by Shareholder to the
Company for inclusion in such prospectus contains an untrue statement of a
material fact or omits to state any material fact required to be stated therein
or necessary to make the statements therein not misleading in the light of the
circumstances under which they were made.
Section
4. Expenses. The
Company shall pay all expenses incurred in effecting all Registrations of
Registrable Stock provided for in this Agreement, including, without limitation,
all Registration and filing fees, printing expenses, fees and disbursements of
counsel for the Company, underwriting expenses (except as limited hereinbelow),
expenses of any audits incident to or required by any such Registration and
expenses of complying with the securities or blue sky laws of any applicable
jurisdictions, other than fees and disbursements of counsel to Shareholders and
underwriting discounts and commissions).
Section
5. Indemnification.
5.1. The
Company agrees, to the extent permitted by law, to indemnify and hold harmless
Shareholder and each direct or indirect member of Shareholder, against any
losses, claims, damages or liabilities (except as limited by Section 5.5), joint
or several, arising out of or based upon:
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(a) any
alleged untrue statement of any material fact contained, on the effective date
thereof, in any Registration statement under which such Securities were
Registered under the Securities Act, any preliminary prospectus or final
prospectus contained therein, or any summary prospectus contained therein, or
any Securities being Registered, or any amendment or supplement thereto,
or
(b) any
alleged omission to state in any such document a material fact required to be
stated therein or necessary to make the statements therein not
misleading,
except
insofar as any such loss, claim, damage or liability is:
(i) caused
by or contained in any information furnished in writing to the Company by
Shareholder or any direct or indirect member of a Shareholder thereof expressly
for use in connection with such Registration, or
(ii) caused
by Shareholder’s or any of its direct or indirect members’ failure to deliver a
copy of the Registration statement or prospectus or any amendment or supplement
thereto as required by the Securities Act or the rules or regulations
thereunder, or
(iii) caused
by the use of a prospectus or preliminary prospectus or any amendment or
supplement by Shareholder or Any of its direct or indirect members after receipt
of notice from the Company that it should no longer be used.
In
connection with an underwritten offering, the Company will indemnify such
underwriters, their officers and directors and each Person who controls (within
the meaning of the Securities Act) such underwriters to the same extent as
provided above with respect to the sellers of Registrable Stock (and with the
same exception with respect to information furnished or omitted by such
underwriter or controlling person thereof). The Company shall
reimburse each Person indemnified pursuant to this Section 5.1 in
connection with investigating or defending any loss, claim, damage, liability or
action indemnified against. The reimbursements required by this Section 5.1 shall be
made by periodic payments during the course of the investigation or defense, as
and when bills are received or expenses incurred. The indemnities
provided pursuant to this Section 5.1 shall
remain in force and effect regardless of any investigation made by or on behalf
of the indemnified party and shall survive transfer of Registrable Stock by a
Shareholder or any direct or indirect member thereof.
5.2. In
the event of any Registration of any Registrable Stock under the Securities Act
pursuant to this Agreement, Shareholder agrees to furnish to the Company in
writing such information and affidavits as the Company reasonably requests for
use in connection with any Registration statement or prospectus in connection
with the Registration or any amendment or supplement thereto.
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5.3. To
the extent permitted by law, and subject to the limitation set forth in the last
sentence of this Section 5.3,
Shareholder agrees to indemnify and hold harmless the Company, its directors,
officers, direct and indirect members, employees and agents
against:
(a) any
losses, claims, damages or liabilities (except as limited by Section 5.5),
arising out of or based upon:
(i) any
alleged untrue statement of any material fact contained, on the effective date
thereof, in any Registration statement under which such Securities were
Registered under the Securities Act, any preliminary prospectus or final
prospectus contained therein, or any summary prospectus contained therein, or
any Securities being Registered, or any amendment or supplement thereto,
or
(ii) any
alleged omission to state in any such document a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
only insofar as any such loss, claim, damage or liability is caused by or
contained in any information furnished in writing to the Company by the
indemnifying Shareholder expressly for use in connection with such Registration;
and
(b) any
losses, claims, damages or liabilities, joint or several, arising out of or
based upon:
(i) any
failure by Shareholder or any of its direct or indirect members to deliver a
copy of the Registration statement or prospectus or any amendment or supplement
thereto as required by the Securities Act or the rules or regulations
thereunder, or
(ii) any
failure by Shareholder or any of its direct or indirect members to stop using
the Registration statement or prospectus or any amendment or supplement thereto
after receipt of written notice from the Company to stop.
In
connection with an underwritten offering, Shareholder will indemnify such
underwriters, their officers and directors and each Person who controls (within
the meaning of the Securities Act) such underwriters to the same extent as
provided above with respect to the Company and other
sellers. Shareholder shall reimburse each Person indemnified pursuant
to this Section
5.3 in connection with investigating or defending any loss, claim,
damage, liability or action indemnified against. The reimbursements
required by this Section 5.3 shall be
made by periodic payments during the course of the investigation or defense, as
and when bills are received or expenses incurred. The indemnities
provided pursuant to this Section 5.3 shall
remain in force and effect regardless of any investigation made by or on behalf
of the indemnified party and shall survive transfer of Registrable Stock by an
indemnifying Person, and transfer of other Securities by any other indemnified
Person.
5.4. Indemnification
similar to that specified in Sections 5.1 and
5.3 (with such
modifications as shall be appropriate) shall be given by the Company and each
Shareholder of any Registrable Stock covered by any Registration or other
qualification of Securities under any federal or state securities law or
regulation other than the Securities Act with respect to any such Registration
or other qualification effected pursuant to this Agreement.
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5.5. In
the event the Company or Shareholder receives a complaint, claim or other notice
of any loss, claim or damage, liability or action, giving rise to claim for
indemnification under this Section 5, the Person
claiming indemnification shall promptly notify the Person against whom
indemnification is sought of such complaint, notice, claim or action, and such
indemnifying Person shall have the right to investigate and defend any such
loss, claim, damage, liability or action. The Person claiming
indemnification shall have the right to employ separate counsel in any such
action and to participate in the defense thereof but the fees and expenses of
such counsel shall not be at the expense of the Person against whom
indemnification is sought (unless the Person claiming indemnification reasonably
believes (with written advice of counsel) that the ability of the counsel
defending such action to defend such Person’s interests therein is affected
adversely and materially by a conflict of interest) and the indemnifying Person
shall not be obligated to indemnify any Person for any settlement of any claim
or action effected without the indemnifying Person’s consent, which consent will
not be unreasonably withheld.
Section
6. Compliance with Rule
144. In the event that the Company (a) Registers a class of
Securities under Section 12 of the Exchange Act, (b) issues an offering circular
meeting the requirements of Regulation A under the Securities Act or (c)
commences to file reports under Section 13 or 15(d) of the Exchange Act, then at
the request of Shareholder or any direct or indirect member thereof who proposes
to sell Securities in compliance with Rule 144, the Company shall, to the extent
necessary to enable Shareholder to comply with such Rule, (y) forthwith furnish
to Shareholder a written statement of compliance with the filing requirements of
the Commission as set forth in Rule 144 and (z) exercise all diligent efforts to
make available to the public and Shareholder such information as will enable any
Shareholder or any direct or indirect members thereof to make sales pursuant to
Rule 144.
Section
7. Piggyback
Rights. If, at any time prior to the registration of the
Registrable Shares, the Company registers pursuant to the Securities Act and
sells in a public distribution for its own account any Saint James Stock, the
Company shall, upon request, register and allow each Shareholder to sell in
conjunction with such distribution any or all of its Registrable
Shares. The Company shall give Shareholder such notice of a proposed
public distribution as is reasonable under the circumstances, giving primary
consideration to the need of the Company to raise capital and the timing of the
proposed distribution.
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Section
8. Legends.
8.1 Certificates
evidencing the Saint James Stock and Conversion Stock shall not contain any
legend with respect to transfer restrictions or otherwise: (i)
following any sale of Saint James Stock, Conversion Stock or Earnout Stock
pursuant to Rule 144, or (ii) if such Saint James Stock, Conversion Stock or
Earnout stock is eligible for sale under Rule 144(b)(ii), or (iii) if such
legend is not required under applicable requirements of the Securities Act
(including judicial interpretations and pronouncements issued by the staff of
the SEC). The Company shall cause its counsel to issue a legal
opinion to its transfer agent promptly after the effective date of a
Registration statement with respect to the Registrable Stock if required by the
transfer agent to effect the removal of the legend hereunder upon sales of
Registrable Stock in compliance with the plan of distribution set forth in the
Registration statement. The Company agrees that at such time as such
legend is no longer required under this Section 8.1, it will,
no later than seven Trading Days following the delivery by Shareholder or any
direct or indirect members of a Shareholder to the Company or its transfer agent
of a certificate representing common stock, as applicable, issued with a
restrictive legend (such seventh Trading Day, the “Legend Removal Date”),
deliver or cause to be delivered to Shareholder or its direct or indirect
members, as applicable, a certificate representing such shares that is free from
all restrictive and other legends. The Company may not make any notation
on its records or give instructions to the transfer agent that enlarge the
restrictions on transfer of the Registrable Stock issued to Shareholder beyond
those set forth in this Agreement. Certificates for stock subject to
legend removal hereunder shall be transmitted by the transfer agent to
Shareholder by crediting the account of such Shareholder’s prime broker with the
Depository Trust Company System.
8.2 Shareholder
agrees that the removal of the restrictive legend from certificates representing
Registrable Stock as set forth in this Section 8 is
predicated upon the Company’s reliance that such Shareholder will sell any
Registrable Stock pursuant to either the registration requirements of the
Securities Act, including any applicable prospectus delivery requirements, or an
exemption therefrom, and that if any Registrable Stock is sold pursuant to a
Registration statement, it will be sold in compliance with the plan of
distribution set forth therein.
Section
9. Miscellaneous.
9.1. Governing Law and
Jurisdiction. It is the intention of the parties that internal
laws of the State of California (irrespective of its choice of law principles)
shall govern the validity of this Agreement. Each of the parties
submits to the exclusive jurisdiction of any state or federal court sitting in
San Francisco, California, in any action or proceeding arising out of or
relating to this Agreement or the transactions contemplated
herein. Each of the parties waives any defense of inconvenient forum
to the maintenance of any action or proceeding so brought and waives any bond,
surety or other security that might be required of any other party with respect
thereto.
9.2 Assignment; Successors and
Assigns. Neither this Agreement nor any rights, benefits or
obligations set forth herein may be assigned by any of the parties
hereto. Except as otherwise provided herein, each and all of the
covenants, terms, provisions and agreements contained herein shall be binding
upon, and shall inure to the benefit of, the successors, executors, heirs,
representatives, administrators and assigns of each of the respective
parties.
9.3 Severability. If
any provision of this Agreement, or the application thereof, shall for any
reason and to any extent be invalid or unenforceable, the remainder of this
Agreement and application of such provisions to other Persons or circumstances
shall be interpreted so as best to reasonably effect the intent of the parties
hereto. The parties further agree to replace any such invalid or
unenforceable provisions of this Agreement with valid and enforceable provisions
which will achieve, to the extent possible, the economic, business and other
purposes of the invalid or unenforceable provisions.
9.4 Entire
Agreement. This Agreement and the Purchase Agreement
constitute the entire understanding and agreement of the parties with respect to
the subject matter hereof and supersede all prior and contemporaneous agreements
or understandings, written or oral, among the parties with respect to such
subject matter.
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9.5 Amendment. Any
term or provision of this Agreement may be amended, and the observance of any
term of this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively) only by a writing signed by
the party to be bound thereby.
9.6 No
Waiver. The failure of any party to enforce any of the
provisions hereof shall not be construed to be a waiver of the right of such
party thereafter to enforce such provision.
9.7 Attorneys’
Fees. Should a suit or proceeding be brought relating to this
Agreement, the prevailing party shall be entitled to recover reasonable
attorneys’ fees, and all other costs, expenses and fees incurred in connection
with such a suit or proceeding and all costs, expenses and fees of any
appeal.
9.8. Notices. Whenever
any party hereto desires or is required to give any notice, demand or request
with respect to this Agreement, each such communication shall be in writing and
shall be effective only if it is delivered by personal service, sent by express
courier service with guaranteed next Trading Day delivery, charges prepaid or by
facsimile or e-mail with verification of receipt, or mailed by the United States
certified mail, postage prepaid, return receipt requested, addressed as
follows:
If to
Shareholder, to:
Saphire
Advisors, LLC
381
Mallory Station Road, Suite 211
Franklin,
Tennessee 37067
Attention:
Jeffrey S. Hopmayer
with a
copy (which shall not constitute notice) to:
Horwood
Marcus & Berk Chartered
180 N.
LaSalle Street, Suite 3700
Chicago,
Illinois 60601
Attention:
Keith H. Berk, Esq.
Facsimile:
(312) 264-2582
If to
Purchaser or Saint James, to:
95 Fable
Farm Road
New
Canaan, CT 06840
Attention:
Richard Hurst
Facsimile:
(203) 972-0265
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with a
copy (which shall not constitute notice) to:
Baker
& Hostetler LLP
600 Anton
Boulevard, Suite 900
Costa
Mesa, California 92626-7221
Attention:
Randy Katz, Esq.
Facsimile:
(714) 966-8802
Each such
communication shall be effective when received by the addressee thereof in the
case of personal service, facsimile or e-mail or, if sent by express courier,
within one Trading Day after delivery to such courier or, if sent by certified
mail in the manner set forth above, three Trading Days after being deposited in
the United States mail. Any party may change its address for such
communications by giving notice thereof to the other party in conformity with
this Section
9.8.
9.9 Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original but all of which shall together constitute one and the same
Agreement.
9.10. Headings. The
headings used herein are solely for the convenience of the parties and shall not
control or affect the meaning or construction of any provisions
hereof.
IN WITNESS WHEREOF, the parties hereto
have caused this Registration Rights Agreement to be executed on the day first
above written.
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THE SAINT JAMES COMPANY
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SAPHIRE ADVISORS, LLC
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By:
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By:
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Its:
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Jeffrey Hopmayer, Manager
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