IS CAPABLE OF EVALUATING THE MERITS AND RISKS OF AN
INVESTMENT IN THE SHARES AND IN PROTECTING HIS OR HER OWN INTEREST IN CONNECTION
WITH THE INVESTMENT.
4.4
HOLDER UNDERSTANDS THAT THE SHARES HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OR UNDER ANY STATE SECURITIES LAWS.
HOLDER IS FAMILIAR WITH
THE PROVISIONS OF THE SECURITIES ACT AND RULE 144 THEREUNDER AND UNDERSTANDS
THAT THE RESTRICTIONS ON TRANSFER PLACED ON THE SHARES MAY RESULT IN HOLDER
BEING REQUIRED TO HOLD THE SHARES FOR AN INDEFINITE PERIOD OF TIME.
4.5
HOLDER BELIEVES THAT HE OR SHE HAS RECEIVED ALL THE INFORMATION HE
OR SHE CONSIDERS NECESSARY OR APPROPRIATE FOR DECIDING WHETHER TO INVEST IN THE
SHARES, AND HOLDER HAS HAD AN OPPORTUNITY TO ASK QUESTIONS AND RECEIVE ANSWERS
FROM NMB AND ITS OFFICERS AND DIRECTORS REGARDING THE BUSINESS, PROSPECTS AND
FINANCIAL CONDITION OF NMB.
4.6
HOLDER AGREES NOT TO SELL, ASSIGN, TRANSFER OR OTHERWISE DISPOSE
OF, WITH OR WITHOUT CONSIDERATION ("TRANSFER") ANY OF THE SHARES EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR AN EXEMPTION
FROM REGISTRATION.
AS A FURTHER CONDITION TO ANY SUCH TRANSFER, EXCEPT IN THE
EVENT THAT SUCH TRANSFER IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IF IN THE REASONABLE OPINION OF COUNSEL TO NMB ANY
TRANSFER OF THE SHARES BY THE CONTEMPLATED TRANSFEREE THEREOF WOULD NOT BE
EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE
SECURITIES ACT, NMB MAY REQUIRE THE CONTEMPLATED TRANSFEREE TO FURNISH NMB WITH
AN INVESTMENT LETTER SETTING FORTH SUCH INFORMATION AND AGREEMENTS AS MAY BE
REASONABLY REQUESTED BY NMB TO ENSURE COMPLIANCE BY SUCH TRANSFEREE WITH THE
SECURITIES ACT.
HOLDER AGREES TO COMPLY WITH ANY AND ALL PROCEDURES FOR ANY
SUCH SALE, ASSIGNMENT OR TRANSFER OF THE SHARES SET FORTH IN THIS AGREEMENT.
4.7
EACH CERTIFICATE EVIDENCING THE SHARES WILL BEAR EITHER THE
FOLLOWING LEGENDS OR
SIMILAR LEGENDS:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE "ACT") AND ARE "RESTRICTED SHARES" AS THAT TERM IS
DEFINED IN RULE 144 UNDER THE ACT.
THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD
OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE ACT."
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A CALL OPTION AND
PROXY IN FAVOR OF BY NATIONAL MERCANTILE BANCORP PURSUANT TO AN AGREEMENT
BETWEEN NATIONAL MERCANTILE BANCORP AND THE REGISTERED HOLDER HEREOF, A COPY OF
WHICH IS ON FILE AT THE OFFICE OF THE ISSUER."
Each Holder agrees to deliver to NMB upon demand the certificate or certificates
evidencing such Holder's Series A Preferred for inclusion of these legends.
4.8
ALL SHARES OF SERIES A PREFERRED DELIVERED TO NMB IN EXCHANGE FOR
SHARES OF NMB COMMON WILL UPON SURRENDER TO NMB BE FREE OF ALL LIENS AND
CHARGES.
5.
Registration Rights.
5.1
IF AT ANY TIME AFTER THE EARLIER OF THE COMMENCEMENT DATE OR
JUNE 30, 2005,