exv10w1






Exhibit 10.1




SUBSCRIPTION AGREEMENT




     This Subscription Agreement (this “Agreement”), dated as of June 11, 2010, is made by and
among the Company (as defined below), successor to Fremont General Corporation, a Nevada
corporation (the “Debtor”), and each investor identified on Annex I (each individually, an
“Investor,” and together with their respective successors and permitted assigns, the “Investors”).



     WHEREAS, the Investors wish to purchase from the Company (as defined below), upon the terms
and conditions stated herein pursuant to that certain Signature Group Holdings LLC’s Fourth Amended
Chapter 11 Plan of Reorganization of Fremont General Corporation, Joined By James McIntyre as
Co-Plan Proponent, Dated May 13, 2010 (the “Plan”), an aggregate of 12,500,000 shares of the
Company’s common stock (the “Shares”); and



     WHEREAS, pursuant to the Plan, the Debtor shall emerge from bankruptcy as a Nevada corporation
(the “Company”), and a $10,000,000 capital contribution contemplated by this Agreement will be
deemed to occur on the Effective Date following (i) the merger of FGCC and FRC into the Company as
contemplated by Article IV.A of the Plan and (ii) the effectiveness of the amended and restated
Articles of Incorporation and the amended and restated Bylaws described in Article IV.G of the Plan
and attached thereto as exhibits.



     NOW, THEREFORE, in consideration of the mutual promises, representations, warranties and
covenants herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Investors mutually agree as
follows. Capitalized terms used and not otherwise defined herein shall have the meanings given such
terms in the Plan.



ARTICLE 1

PURCHASE OF COMMON STOCK



1.1 Purchase of Shares in Exchange for Cash Payment. Subject to the terms and
conditions of this Agreement, on the Effective Date, the Investor listed in Annex I shall
severally, and not jointly, purchase, and the Company shall sell and issue to each of the
Investors, the Shares in the respective amounts set forth opposite each such Investor’s name on
Annex I in exchange for the purchase price set forth opposite each such Investor’s name on
Annex I.



1.2 Trust Account. At least 10 days prior to the Effective Date, each Investor shall
deliver into a trust account, to be held at the law firm of Rutan & Tucker, LLP, cash equal to the
amount set forth opposite each such Investor’s name on Annex I (the “Trust Account”), or
shall otherwise provide evidence of the availability of funds to the reasonable satisfaction of the
Company.



1.3 Investor Information. Each Investor shall deliver complete, final and accurate copies
of Annex I, Annex II, and Annex III (if applicable), setting forth information regarding the
identification and certain representations of the Investors, at least 5 days prior to the Effective
Date.






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1.4 Closing. The closing of the purchase and sale of the Shares shall take place on the
Effective Date at the offices of Manderson, Schafer & McKinlay LLP, 4695 MacArthur Court, Suite
1270, Newport Beach, California, 92660, or at such other location as the Company and the Investors
shall mutually agree.



1.5 Delivery. On the Effective Date, the Company shall deliver to each Investor the Shares
(in certificate or book entry form), each registered in such name or names as each Investor may
designate. On the Closing Date, each Investor shall pay, or cause Rutan & Tucker, LLP to pay (by
wire transfer in same day funds to an account specified by the Company in writing or pursuant to
other funding instructions specified by the Company in writing), to the Company the amount set
forth opposite each such Investor’s name on Annex I under column 1.b.




ARTICLE 2

REPRESENTATIONS AND WARRANTIES OF THE INVESTORS




     Each Investor, severally and not jointly, represents and warrants to the Company that the
statements contained in this Article 2 are true and correct as of the date hereof and will be as of
the Effective Date, except to the extent such representations and warranties are specifically made
as of a particular date (in which case such representations and warranties are true and correct as
of such date).


2.1 Investor is an “accredited investor” as defined by Rule 501 of Regulation D under the
Securities Act, which is set forth under Appendix II to this Agreement. Investor
acknowledges that it has such knowledge and experience in financial and business matters that
Investor is capable of evaluating the merits and risks of an investment in the Securities and of
making an informed investment decision with respect thereto. Investor acknowledges that an
investment in the Securities is speculative and involves a high degree of risk and that Investor
can bear the economic risk of the acceptance of the Securities, including a total loss of its
investment. Investor is experienced in evaluating and investing in early stage or start-up or
reorganizing companies such as the Company. Investor acknowledges that the Debtor is currently not
in compliance with reporting requirements under the rules of the Securities and Exchange
Commission.



2.2 Investor understands that the Shares, and all underlying securities, have not been
registered under the Securities Act on the ground that the issuance thereof is exempt under Section
4(2) of the Act and/or Regulation D as a transaction by an issuer not involving any public
offering, and that the statutory basis for the exception claimed would not be present if any of the
representations and warranties of Investor contained in this Agreement are untrue, or
notwithstanding the Investor’s representations and warranties, the Investor currently intends to
acquire any of the Shares for resale upon the occurrence or non-occurrence of some predetermined
event.



2.3 Investor is purchasing the Shares solely for its own account, and, in the event that
the Investor should acquire any underlying securities, will be acquiring such underlying securities






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solely for its own account, and not for the benefit of any other Person. Investor is acquiring the
Shares solely for investment purposes and not with a view to distribution or resale, nor with the
intention of selling, transferring or otherwise disposing of all or any part thereof for any
particular price, or at any particular time, or upon the happening of any particular event or
circumstance, except selling, transferring, or disposing of the Shares, in full compliance with all
applicable provisions of the Securities Act, the rules and regulations promulgated by the
Securities and Exchange Commission thereunder, and applicable state securities laws. Investor
understands and acknowledges that an investment in the Shares is not a liquid investment.



2.4 Information. Investor confirms that Investor has received and has had a
chance to review the Plan, the related Court-approved Signature Group Holdings, LLC Disclosure
Statement dated January 20, 2010, and the Court-approved Fremont General Corporation Informational
Cover Letter regarding the solicitation of five (5) competing chapter 11 plans in the bankruptcy
case of Fremont General Corporation and the exhibits attached thereto. Investor confirms that
Investor has had the opportunity to ask questions of, and receive answers from, the Company or any
authorized Person acting on its behalf concerning the Company and its business, and to obtain any
additional information, to the extent possessed by the Company (or to the extent it could have been
acquired by the Company without unreasonable effort or expense) necessary to verify the accuracy of
the information received by Investor. In connection therewith, Investor acknowledges that Investor
has had the opportunity to discuss the Company’s business, management and financial affairs with
the Company’s management or any authorized Person acting on its behalf. Investor has received and
reviewed all the information concerning the Company and the Shares, both written and oral, that
Investor desires. In determining whether to make this investment, Investor has relied solely on
Investor’s own knowledge and understanding of the Company and its business based upon Investor’s
own due diligence investigations.



2.5 Authorization. Investor has all requisite legal and other power and authority to
execute and deliver this Agreement and to carry out and perform its obligations under the terms of
this Agreement. This Agreement constitutes a valid and legally binding obligation of Investor
enforceable in accordance with its terms, subject as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting creditors’ rights
and to general equity principles.



2.6 Suitability of Investment. Investor has carefully considered and has discussed with
its legal, tax, accounting and financial advisors, to the extent the Investor has deemed necessary,
the suitability of this investment and the transactions contemplated by this Agreement for the
Investor’s particular federal, state, provincial, local and foreign tax and financial situation and
has independently determined that this investment and the transactions contemplated by this
Agreement are a suitable investment for the Investor. Investor understands that it (and not the
Company) shall be responsible for Investor’s own tax liability that may arise as a result of the
investment in the Shares or the transactions contemplated by this Agreement.



2.7 Restricted Securities. The Investor understands that the Shares are characterized as
“restricted securities” under the federal securities laws, inasmuch as they are being acquired from
the Company in a transaction not involving a public offering and that, under such laws and






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applicable regulations, the Shares may be resold without registration under the Securities Act only
in certain limited circumstances. The Investor acknowledges that the Shares must be held
indefinitely unless subsequently registered under the Securities Act or an exemption from such
registration is available.



Pursuant to the Signature Plan, certificates evidencing shares of stock and warrants received by
(i) holders of securities issued in reliance upon the exemption set forth in section 4(2) of the
Securities Act, (ii) holders of five percent or more of the outstanding common stock or (iii) by
holders that request legended certificates and who certify that they may be deemed to be
underwriters within the meaning of section 1145 of the Bankruptcy Code, will bear a legend
substantially in the form below:



THE SECURITIES EVIDENCED BY THIS CERTIFICATE AND, IF APPLICABLE, THE COMMON STOCK UNDERLYING SUCH
SECURITIES, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE
SECURITIES. LAWS OF ANY STATE OR OTHER JURISDICTION AND MAY NOT BE SOLD, OFFERED FOR SALE OR
OTHERWISE TRANSFERRED UNLESS REGISTERED OR QUALIFIED UNDER SAID ACT AND APPLICABLE STATE SECURITIES
LAWS OR UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH
REGISTRATION OR QUALIFICATION IS NOT REQUIRED.



Any person that would receive legended securities as provided above may instead receive
certificates evidencing securities without such legend if, prior to the Effective Date, such person
or entity delivers to the Debtor (a) an opinion of counsel reasonably satisfactory to the Debtor to
the effect that the shares to be received by such person or entity (or the common stock underlying
such shares) may be sold without registration under the Securities Act and (b) a certification that
such person or entity is not an “underwriter” within the meaning of section 1145 of the Bankruptcy
Code.



Any holder of a certificate evidencing shares of the Reorganized Debtor bearing such legend may
present such certificate to the transfer agent for exchange for one or more new certificates not
bearing such legend or for transfer to a new holder without such legend at such times as (a) such
shares are sold pursuant to an effective registration statement under the Securities Act or (b)
such holder delivers to the Reorganized Debtor an opinion of counsel reasonably satisfactory to the
Reorganized Debtor to the effect that such shares are no longer subject to the restrictions
pursuant to an exemption under the Securities Act and such shares may be sold without registration
under the Securities Act, in which event the certificate issued to the transferee will not bear
such legend.



2.8 Investor Information. The residency of Investor (or, in the case of a partnership,
limited liability company or corporation, such entity’s principal place of business) is correctly
set forth below Investor’s name on Annex I. Each Investor shall complete and sign
Annex II or Annex III hereto (as applicable), providing certain investor
representations contained therein.







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ARTICLE 3

CONDITIONS RELATING TO THE CLOSING



3.1 Conditions to the Obligations of the Company at the Closing. The obligation
of the Company to consummate the transactions to be performed by it in connection with the Closing
with respect to each Investor are, unless otherwise indicated, subject to the satisfaction of the
following conditions as of the Effective Date, unless such conditions are waived by the Company:




     (a) Representations, Warranties and Covenants. The representations and warranties made
by each such Investor in Article 2 hereof shall be true and correct as of the Effective Date. The
Investor shall have performed and complied in all material respects with all covenants and
agreements required by this Agreement to be performed or complied with by it on or prior to the
Effective Date.



     (b) Availability of Funds. The Investors shall have deposited in the Trust Account
all of the cash needed to satisfy the Investors’ purchase obligations under the Plan and this
Agreement, or shall otherwise have provided evidence of the availability of funds to the reasonable
satisfaction of the Company.


3.2 Conditions to the Obligations of the Investors at the Closing. The obligation
of each Investor to consummate the transactions to be performed by it in connection with the
Closing with respect to the Company are, unless otherwise indicated, subject to the satisfaction of
the following conditions as of the Effective Date, unless such conditions are waived by such
Investor:




     (a) Covenants. The Company shall have performed and complied in all material respects
with all covenants and agreements required by this Agreement to be performed or complied with by it
on or prior to the Effective Date.



     (b) Changes to the Plan. Any modifications to the Plan shall be reasonably acceptable
to such Investor.



     (c) All conditions set forth in Section VIII.B of the Plan shall have been satisfied and none
of the foregoing conditions shall have been waived without the prior written approval of such
Investor.



ARTICLE 4

MISCELLANEOUS



4.1 Governing Law. Unless a rule of law or procedure is supplied by federal law (including
the Bankruptcy Code and Bankruptcy Rules), the laws of (a) the State of California shall govern the
construction and implementation of the Plan and (except as may be provided otherwise in any such
agreements, documents, or instruments) any agreements, documents, and instruments executed in
connection with the Plan and (b) the laws of the state of incorporation of the Debtor






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shall govern corporate governance matters; in each case without giving effect to the principles of
conflicts of law thereof.



4.2 No Third Party Reliance. Anything contained herein to the contrary
notwithstanding, the representations and warranties contained in this Agreement (a) are being given
as an inducement to the Company to enter into this Agreement and (b) are solely for the benefit of
the Company. Accordingly, no third party shall be a third-party or other beneficiary of such
representations and warranties and no such third party shall have any rights of contribution
against the Investors or the Company with respect to such representations or warranties or any
matter subject to or resulting in indemnification under this Agreement or otherwise.



4.3 Amendment. This Agreement may not be modified or amended in any manner except in a
writing executed by the Company, Craig Noell, Kenneth Grossman, and any Investor whose interest may
be adversely affected by the amendment.



4.4 Counterparts; Facsimile and Electronic Signatures. This Agreement may be executed in
any number of counterparts, and each such counterpart hereof shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one agreement. Counterpart
signatures to this Agreement delivered by facsimile or other electronic transmission shall be
acceptable and binding.



4.5 Headings. The section and paragraph headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or interpretation of this
Agreement.




* * * * *




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IN WITNESS WHEREOF, each of the undersigned has duly executed this Subscription Agreement as of the
date first written above.



INVESTOR



	 	 	 	 	 
	Individuals:	 	Entities:	 	 
	(Includes joint tenants, tenants in common and individual IRA beneficiaries)
	 	(Includes corporations, limited liability companies, partnerships,
cooperatives, trusts and IRA custodians)	 	 
	 
	 	 	 	 
	 
	 

Name of Subscriber (as it is to appear on certificate(s))
	 	 

Name of Entity Subscriber (as it is to appear on certificate(s))	 	 
	 
	 	 	 	 
	 
	 

Signature
	 	 

Authorized Signature	 	 
	 
	 	 	 	 
	 
	 

Name of Joint Subscriber, if any (as it is to appear on certificate(s))
	 	 

Print Name	 	 
	 
	 	 	 	 
	 
	 

Signature of Joint Subscriber
	 	 

Title	 	 





	 	 	 	 	 	 	 

	 	 	Accepted by:	 	 
	 
	 	 	 	 	 	 
	 	 	REORGANIZED DEBTOR	 	 
	 
	 	 	 	 	 	 
	 
	 	By:	 	 
	 	 
	 
	 
	 	Name:	 	 
	 	 
	 
	 
	 	Title:	 	 
	 	 
	 
	 
	 	 	 	 
	 	 





[Signature page to Subscription Agreement]





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Annex I




Subscription Schedule



	 	 	 	 	 
	Name and Address1	 	(a)	 	(b)
	of Investor	 	Common Stock (#)	 	Purchase Price ($)
	 
	 
	 	 	 	 







 




			
	1	 	Listed address is the principal place of
business, if a business entity, or state of residency, if an individual.





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Annex II




ADDITIONAL REPRESENTATIONS AND WARRANTIES

OF INVESTOR WHO IS AN INDIVIDUAL


Investor represents and warrants as follows:





	1.	 	Investor is an individual.
	 
	2.	 	Investor is a resident of the following (check applicable line)






	 	(i)	 	U.S. state and county:                                         , or
	 
	 	(ii)	 	foreign country:                                        






	3.	 	Investor understands that the Company’s reliance on the exemptions from
registration under the Securities Act is based in part on the representations made
herein by Investor. Investor is an “accredited investor” as that term is defined in
Regulation D under the Securities Act and falls within the category indicated below
(check the applicable line):






	 	a.	 	A broker or dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934.
	 
	 	b.	 	An individual whose individual net worth, or joint net worth
with his or her spouse, at the time of this purchase exceeds $1,000,000.
	 
	 	c.	 	An individual who had an individual income in excess of
$200,000 in each of the two most recent years, or joint income with his or her
spouse in excess of $300,000 in each of those years, and has a reasonable
expectation of reaching the same income level in the current year.





	 	 	 	 	 

	 
	 	INVESTOR	 	 
	 
	 	 	 	 
	 
	 
	 	 

[Signature of Investor]	 	 
	 
	 	 	 	 
	 
	 
	 	 

[Print Name of Investor]	 	 






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Annex III




ADDITIONAL REPRESENTATIONS AND WARRANTIES OF

INVESTOR THAT IS NOT AN INDIVIDUAL




     Investor represents and warrants as follows:



     1. Investor is a (fill in one of the following: “corporation,” “partnership,” “limited
liability company,” “trust,” “foundation” or other type of organization):                                         .



     2. Investor maintains its principal place of business in the following (i) U.S. state and
county, or (ii) foreign country:                                         .




	3.	a.	 	If Investor is a corporation, Investor is duly incorporated, validly existing
and in good standing under the laws of:                                         (U.S. state or foreign country).
	 
	 	b.	 	If Investor is a partnership, limited liability company, trust or other
form of organization, Investor is duly organized and validly existing under the laws
of :                                         (U.S. state or foreign country).





     4. Investor understands that the Company’s reliance on the exemptions from registration under
the Securities Act is based in part on the representations made herein by Investor. Investor is an
“accredited investor” as that term is defined in Regulation D under the Securities Act and falls
within the category indicated below (check the applicable line):




	 	a.	 	A bank, as defined in Section 3(a)(2) of the Securities Act or a savings
and loan association or other institution as defined in Section 3(a)(5)(A) of the
Securities Act, whether acting in its individual or fiduciary capacity.
	 
	 	b.	 	A broker or dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934.
	 
	 	c.	 	An insurance company as defined in Section 2(13) of the Securities Act.
	 
	 	d.	 	An investment company required to be registered under the Investment
Company Act or a business development company as defined in Section 2(a)(48) of the
Investment Company Act.
	 
	 	e.	 	A Small Business Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business Investment Act of
1958.
	 
	 	f.	 	A private business development company as defined in Section 202(a)(22)
of the Investment Advisers Act of 1940.





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	 	g.	 	An organization described in Section 501(c)(3) of the Code, not formed for
the specific purpose of acquiring the securities offered, with total assets in
excess of $5,000,000.
	 
	 	h.	 	A corporation, Massachusetts or similar business trust, limited liability
company or partnership, not formed for the specific purpose of acquiring the
securities offered, with total assets in excess of $5,000,000 (other than one
described in item (g) above).
	 
	 	i.	 	A trust, with total assets in excess of $5,000,000, not formed for the
specific purpose of acquiring the securities offered, whose purchase is directed by
a sophisticated person as described in Regulation Section 230.506(b)(2)(ii)
promulgated under the Securities Act.
	 
	 	j.	 	An entity in which all of the equity owners are “accredited investors.”





     5. Investor
          
 (fill in “was” or “was not”) formed for the specific purpose of making an
investment in the Company.



	 	 	 	 	 	 	 

	 	 	INVESTOR:	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 

	 	 







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