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Exhibit 10.9    
    

 
 

STOCK ESCROW AGREEMENT    
    

        STOCK ESCROW AGREEMENT, dated as of                        , 2005
("Agreement"), by and among COASTAL BANCSHARES ACQUISITION CORP., a Delaware corporation ("Company"),
CARY M. GROSSMAN, COASTAL ACQUISITION, LLC, W. DONALD BRUNSON, SCOTT CLINGAN, FRED S. ZEIDMAN, JEFFREY P. SANGALIS (collectively "Initial Stockholders") and Continental Stock Transfer & Trust
Company ("Escrow Agent"). 

        WHEREAS,
the Company has entered into an Underwriting Agreement, dated            , 2005 ("Underwriting Agreement"), with I-Bankers Securities Incorporated and Newbridge
Securities Corporation (collectively, the "Representatives") acting as representative of the several underwriters (collectively, the "Underwriters"), pursuant to which, among other matters, the
Underwriters will agree to purchase 4,000,000 units ("Units") of the Company. Each Unit will consist of one share of the Company's Common Stock, par value $.01 per share, and two Warrants, each
Warrant to purchase one share of Common Stock, all as more fully described in the Company's final Prospectus, dated            , 2005 ("Prospectus") comprising part of the Company's
Registration
Statement on Form S-1 (File No. 333-118294) under the Securities Act of 1933, as amended ("Registration Statement"), declared effective
on                        , 2005
("Effective Date"). 

        WHEREAS,
the Initial Stockholders have agreed as a condition of the sale of the Units to deposit their shares of Common Stock of the Company, as set forth opposite their respective names
in Exhibit A attached hereto (collectively "Escrow Shares"), in escrow as hereinafter provided. 

        WHEREAS,
the Company and the Initial Stockholders desire that the Escrow Agent accept the Escrow Shares, in escrow, to be held and disbursed as hereinafter provided. 

        IT
IS AGREED: 

        1.     Appointment
of Escrow Agent. The Company and the Initial Stockholders hereby appoint the Escrow Agent to act in accordance with and subject to the terms of this Agreement
and the Escrow Agent hereby accepts such appointment and agrees to act in accordance with and subject to such terms. 

        2.     Deposit
of Escrow Shares. On or before the Effective Date, each of the Initial Stockholders shall deliver to the Escrow Agent certificates representing his respective
Escrow Shares, to be held and disbursed subject to the terms and conditions of this Agreement. Each Initial Stockholder acknowledges that the certificate representing his Escrow Shares is legended to
reflect the deposit of such Escrow Shares under this Agreement. 

        3.     Disbursement
of the Escrow Shares. The Escrow Agent shall hold the Escrow Shares until the third anniversary of the Effective Date ("Escrow Period"), on which date it
shall, upon written instructions from each Initial Stockholder, disburse each of the Initial Stockholder's Escrow Shares to such Initial Stockholder; provided, however, that if the Escrow Agent is
notified by the Company pursuant to Section 6.7 hereof that the Company is being liquidated at any time during the Escrow Period, then the Escrow Agent shall promptly destroy the certificates
representing the Escrow Shares and; provided further, that if, after the Company consummates a Business Combination (as such term is defined in the Registration Statement), it (or the surviving
entity) subsequently consummates a liquidation, merger, stock exchange or other similar transaction which results in all of the stockholders of such entity having the right to exchange their shares of
Common Stock for cash, securities or other property, then the Escrow Agent will, upon receipt of a certificate, executed by the Chief Executive Officer or Chief Financial Officer of the Company, in
form reasonably acceptable to the Escrow Agent, that such transaction is then being consummated, release the Escrow Shares to the Initial Stockholders upon consummation of the transaction so that they
can similarly participate. The Escrow Agent shall have no further duties hereunder after the disbursement or destruction of the Escrow Shares in accordance with this Section 3. 

        4.     Rights
of Initial Stockholders in Escrow Shares. 

        4.1    Voting Rights as a Stockholder.    Subject to the terms of the Insider Letter described in Section 4.4
hereof and except as herein provided, the Initial Stockholders shall retain all of their rights as stockholders of the Company during the Escrow Period, including, without limitation, the right to
vote such shares. 

        4.2    Dividends and Other Distributions in Respect of the Escrow Shares.    During the Escrow Period, all dividends
payable in cash with respect to the Escrow Shares shall be paid to the Initial Stockholders, but all dividends payable in stock or other non-cash property ("Non-Cash
Dividends") shall be delivered to the Escrow Agent to hold in accordance with the terms hereof. As
used herein, the term "Escrow Shares" shall be deemed to include the Non-Cash Dividends distributed thereon, if any. 

        4.3    Restrictions on Transfer.    During the Escrow Period, no sale, transfer or other disposition may be made of
any or all of the Escrow Shares except (i) by gift to a member of Initial Stockholder's immediate family or to a trust, the beneficiary of which is an Initial Stockholder or a member of an
Initial Stockholder's immediate family, (ii) by virtue of the laws of descent and distribution upon death of any Initial Stockholder, (iii) pursuant to a qualified domestic relations
order, or (iv) pursuant to a transfer of record ownership whereby there is no change in beneficial ownership; provided, however, that such permissive transfers may be implemented only upon the
respective transferee's written agreement to be bound by the terms and conditions of this Agreement and of the Insider Letter signed by the Initial Stockholder transferring the Escrow Shares. During
the Escrow Period, the Initial Stockholders shall not pledge or grant a security interest in the Escrow Shares or grant a security interest in their rights under this Agreement. 

        4.4    Insider Letters.    Each of the Initial Stockholders has executed a letter agreement with the Representatives
and the Company, dated as indicated on Exhibit A hereto, and which is filed as an exhibit to the Registration Statement ("Insider Letter"), respecting the rights and obligations of such Initial
Stockholder in certain events, including but not limited to the liquidation of the Company. 

        5.     Concerning
the Escrow Agent. 

        5.1    Good Faith Reliance.    The Escrow Agent shall not be liable for any action taken or omitted by it in good
faith and in the exercise of its own best judgment, and may rely conclusively and shall be protected in acting upon any order, notice, demand, certificate, opinion or advice of counsel (including
counsel chosen by the Escrow Agent), statement, instrument, report or other paper or document (not only as to its due execution and the validity and effectiveness of its provisions, but also as to the
truth and acceptability of any information therein contained) which is believed by the Escrow Agent to be genuine and to be signed or presented by the proper person or persons. The Escrow Agent shall
not be bound by any notice or demand, or any waiver, modification, termination or rescission of this Agreement unless evidenced by a writing delivered to the Escrow Agent signed by the proper party or
parties and, if the duties or rights of the Escrow Agent are affected, unless it shall have given its prior written consent thereto. 

        5.2    Indemnification.    The Escrow Agent shall be indemnified and held harmless by the Company from and against any
expenses, including counsel fees and disbursements, or loss suffered by the Escrow Agent in connection with any action, suit or other proceeding involving any claim which in any way, directly or
indirectly, arises out of or relates to this Agreement, the services of the Escrow Agent hereunder, or the Escrow Shares held by it hereunder, other than expenses or losses arising from the gross
negligence or willful misconduct of the Escrow Agent. Promptly after the receipt by the Escrow Agent of notice of any demand or claim or the commencement of any action, suit or proceeding, the Escrow
Agent shall notify the other parties hereto in writing. In the event of the receipt of such notice, the Escrow Agent, in its sole discretion, may commence an action in the nature of interpleader in an
appropriate court to determine ownership or disposition of the Escrow Shares or it may deposit the Escrow Shares with the clerk of any appropriate court or it may retain the Escrow Shares pending
receipt of a final, non-appealable order of a court having jurisdiction over all of the parties hereto directing to whom 

and
under what circumstances the Escrow Shares are to be disbursed and delivered. The provisions of this Section 5.2 shall survive in the event the Escrow Agent resigns or is discharged
pursuant to Sections 5.5 or 5.6 below. 

        5.3    Compensation.    The Escrow Agent shall be entitled to reasonable compensation from the Company for all
services rendered by it hereunder. The Escrow Agent shall also be entitled to reimbursement from the Company for all expenses paid or incurred by it in the administration of its duties hereunder
including, but not limited to, all counsel, advisors' and agents' fees and disbursements and all taxes or other governmental charges. 

        5.4    Further Assurances.    From time to time on and after the date hereof, the Company and the Initial Stockholders
shall deliver or cause to be delivered to the Escrow Agent such further documents and instruments and shall do or cause to be done such further acts as the Escrow Agent shall reasonably request to
carry out more effectively the provisions and purposes of this Agreement, to evidence compliance herewith or to assure itself that it is protected in acting hereunder. 

        5.5    Resignation.    The Escrow Agent may resign at any time and be discharged from its duties as escrow agent
hereunder by its giving the other parties hereto written notice and such resignation shall become effective as hereinafter provided. Such resignation shall become effective at such time that the
Escrow Agent shall turn over to a successor escrow agent appointed by the Company, the Escrow Shares held hereunder. If no new escrow agent is so appointed within the 60 day period following
the giving of such notice of resignation, the Escrow Agent may deposit the Escrow Shares with any court it reasonably deems appropriate. 

        5.6    Discharge of Escrow Agent.    The Escrow Agent shall resign and be discharged from its duties as escrow agent
hereunder if so requested in writing at any time by the other parties hereto, jointly, provided, however, that such resignation shall become effective only upon acceptance of appointment by a
successor escrow agent as provided in Section 5.5. 

        5.7    Liability.    Notwithstanding anything herein to the contrary, the Escrow Agent shall not be relieved from
liability hereunder for its own gross negligence or its own willful misconduct. 

        6.     Miscellaneous. 

        6.1    Governing Law.    This Agreement shall for all purposes be deemed to be made under and shall be construed in
accordance with the laws of the State of New York. 

        6.2    Third Party Beneficiaries.    Each of the Initial Stockholders hereby acknowledges that the Underwriters are
third party beneficiaries of this Agreement and this Agreement may not be modified or changed without the prior written consent of the Representatives. 

        6.3    Entire Agreement.    This Agreement contains the entire agreement of the parties hereto with respect to the
subject matter hereof and, except as expressly provided herein, may not be changed or modified except by an instrument in writing signed by the party to the charged. 

        6.4    Headings.    The headings contained in this Agreement are for reference purposes only and shall not affect in
any way the meaning or interpretation thereof. 

        6.5    Binding Effect.    This Agreement shall be binding upon and inure to the benefit of the respective parties
hereto and their legal representatives, successors and assigns. 

        6.6    Notices.    Any notice or other communication required or which may be given hereunder shall be in writing and
either be delivered personally or be mailed, certified or registered mail, or by private national courier service, return receipt requested, postage prepaid, and shall be deemed given when so
delivered personally or, if mailed, two days after the date of mailing, as follows: 

        If
to the Company, to: 

Coastal
Bancshares Acquisition Corp.

9821 Katy Freeway, Suite 500

Houston, Texas 77024

Attn: Cary M. Grossman, Co-Chief Executive Officer 

        If
to a Stockholder, to his address set forth in Exhibit A. 

        and
if to the Escrow Agent, to: 

Continental
Stock Transfer & Trust Company

18 Battery Place

New York, New York 10004

Attn: Chairman 

The
parties may change the persons and addresses to which the notices or other communications are to be sent by giving written notice to any such change in the manner provided herein for giving
notice. 

        6.7    Liquidation of Company.    The Company shall give the Escrow Agent written notification of the liquidation and
dissolution of the Company in the event that the Company fails to consummate a Business Combination within the time period(s) specified in the Prospectus. 

        6.8    Amendment.    This Agreement contains the entire agreement and understanding of the parties hereto with respect
to the subject matter hereof. This Agreement or any provision hereof may only be changed, amended or modified by a writing signed by each of the parties hereto; provided, however, that no such change,
amendment or modification may be made without the prior written consent of the Representative. As to any claim, cross-claim or counterclaim in any way relating to this Agreement, each party waives the
right to trial by jury. 

        6.9    Assignment.    This Agreement may not be assigned by the Escrow Agent without the prior consent of the Company. 

        WITNESS
the execution of this Agreement as of the date first above written. 

	 	 	COASTAL BANCSHARES ACQUISITION CORP.
	 	 	 	 	 
	 	 	 	 	 
	 	 	By:	 	 
	 	 	 	 	
 Cary M. Grossman

Co-Chief Executive Officer
	 	 	 	 	 
	 	 	INITIAL STOCKHOLDERS:
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	
 Cary M. Grossman
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	
 Coastal Acquisition, LLC

By: Cary M. Grossman, Manager
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	
 W. Donald Brunson
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	
 Scott Clingan
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	
 Fred S. Zeidman
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	
 Jeffrey P. Sangalis
	 	 	 	 	 
	 	 	CONTINENTAL STOCK TRANSFER & TRUST COMPANY
	 	 	 	 	 
	 	 	 	 	 
	 	 	By:	 	 
	 	 	 	 	

	 	 	Name:	 	 
	 	 	 	 	

	 	 	Title:	 	 
	 	 	 	 	

EXHIBIT A  

	Name and Address of Initial

Stockholder
 
	 	Number of Shares
	 	Stock Certificate Number

	

Cary M. Grossman

9821 Katy Freeway, Suite 500,

Houston, Texas 77024.	
 	

282,500	
 	

1
	

Coastal Acquisition, LLC

9821 Katy Freeway, Suite 500,

Houston, Texas 77024.	
 	

300,000	
 	

2
	

W. Donald Brunson

American Prudential Capital, Inc.

13100 Northwest Frwy., Suite 300

Houston, Texas 77040	
 	

242,500	
 	

3
	

Scott Clingan

9821 Katy Freeway, Suite 500

Houston, Texas 77024	
 	

85,000	
 	

4
	

Fred S. Zeidman

2104 Chilton Road

Houston, Texas 77019	
 	

40,000	
 	

5
	

Jeffrey P. Sangalis

RSTW Partners

5847 San Felipe, Suite 4350

Houston, TX 77057	
 	

50,000	
 	

6

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Exhibit 10.9

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Exhibit 10.14    
    

 
 

WARRANT PURCHASE PARTICIPATION AGREEMENT    
    

        THIS WARRANT PURCHASE PARTICIPATION AGREEMENT (the "Participation Agreement") is made as of September 30, 2004, by and among W. Donald Brunson ("Brunson"),
Cary M. Grossman ("Grossman"), Jeffrey P. Sangalis ("Sangalis") and Scott Clingan ("Clingan"). 

RECITALS  

        WHEREAS, the parties hereto are officers and/or directors of Coastal Bancshares Acquisition Corp., a Delaware corporation (the "Company"), which filed its initial
registration statement on Form S-1 on August 17, 2004 (No. 333-118294) for the proposed public offering of 4 million units, each consisting of one
share of Common Stock and two warrants (the "Offering"). 

        WHEREAS,
Grossman and Brunson hold membership interests in Coastal Acquisition, LLC ("Coastal LLC") and Coastal LLC holds 300,000 shares of Common Stock of the Company. 

        WHEREAS,
in connection with the Offering, Grossman and Brunson have entered into an agreement with I-Bankers Securities Incorporated and Newbridge Securities Corporation (the
"Representatives") whereby they have agreed to purchase, collectively, up to 1,000,000 warrants at market prices not to exceed $0.65 per warrant (the "Warrants") of the Company, following the closing
of the Offering and within a twenty trading-day period commencing on the date separate trading of the Warrants commences (the "Warrant Purchase Agreement"). 

        WHEREAS,
pursuant to the Warrant Purchase Agreement, (i) the Representatives have an irrevocable order to purchase, on one or more occasions, up to 1,000,000 Warrants (the
"Order") for the accounts of Grossman and Brunson, and (ii) in connection with the Order, Grossman and Brunson may notify
the Representatives that all or part of the respective purchase of the Warrants will be made by an affiliate or designee. 

        WHEREAS,
the parties hereto desire to participate in the purchase of the Warrants, as an affiliate or designee, and the parties desire to enter into this Participation Agreement, which
sets forth the commitment by each party to participate in fulfilling the Order, by purchasing the number of Warrants equal to a specified economic value ("Warrant Value"). 

AGREEMENT  

        NOW, THEREFORE, in consideration of the promises contained herein, and other good and valuable consideration, the receipt and sufficiency of which we hereby
acknowledged, the parties hereby agree as follows: 

        1.     The
Order, as prescribed by the Representatives, shall be fulfilled as follows: 

	(a)
	Brunson
shall purchase, for his personal account, the lesser of (i) a $100,000 Warrant Value, and (ii) the difference between a $100,000 Warrant Value and the Order;

	(b)
	If
the Order exceeds a $100,000 Warrant Value, Brunson shall purchase the lesser of (i) a $50,000 Warrant Value, and (ii) the difference between the Order and a $150,000
Warrant Value, for his personal account, or through an affiliate or designee;

	(c)
	If
the Order exceeds a $150,000 Warrant Value, Grossman shall purchase the lesser of (i) a $50,000 Warrant Value, and (ii) the difference between the Order and a
$200,000, for his personal account;

	(d)
	If
the Order exceeds a $200,000 Warrant Value, Grossman shall purchase the lesser of (i) a $275,000 Warrant Value, and (ii) the difference between the a $475,000 Warrant
Value and the Order, for his personal account or through an affiliate or designee; 

 

	(e)
	If
the Order exceeds a $475,000 Warrant Value, Clingan and Sangalis shall purchase, on a pro-rata basis, the lesser of (i) a $100,000 Warrant Value (the "Commitment
Value"), and (ii) the difference between the a $575,000 Warrant Value and the Order; and

	(f)
	If
the Order exceeds a $575,000 Value, Brunson shall purchase the lesser of (i) a $75,000 Warrant Value, or (ii) the difference between a $650,000 Warrant Value and the
Order, for his personal account or through an affiliate or designee. 

        2.    Consideration.    In consideration of the commitment by Clingan and Sangalis to enter into this Participation
Agreement, Brunson agrees to transfer a certain percentage of his membership interest in Coastal LLC as set forth below. 

        (i)    Brunson
will transfer, on a pro-rata basis, up to 100% of his membership interest in Coastal LLC (the "Interest"), which represents a residual ownership of
27,451 shares of Common Stock of the Company, to Clingan and Sangalis in correlation with the percentage of the Commitment Value purchased by Clingan and Sangalis pursuant to Section 1(e) above
(the "Transferred Interest"); and 

        (ii)   The
Transferred Interest will be subject to a minimum of 36.4% of the Interest, which represents a residual ownership of 10,000 shares of Common Stock of the Company. 

        By
way of illustration, if Clingan and Sangalis purchase a $1 to $18,200 Warrant Value, the Transferred Interest will be 36.4% of the Interest, and each of Clingan and Sangalis will
receive 18.2% of the Interest. If Clingan and Sangalis purchase a $50,000 Warrant Value, the Transferred Interest will be 50% of the Interest, and each of Clingan and Sangalis will receive 25% of the
Interest. 

        3.    Further Assurances.    Each of the parties hereto agrees to execute and deliver such additional documents and do
such additional acts as the other may reasonably request in order to carry out the intent of this Participation Agreement and to more fully evidence the transactions contemplated hereby. 

        4.    Governing Law.    This Participation Agreement shall be interpreted, construed, and enforced in accordance with
the laws of the State of Texas, without regard to conflicts of laws principles. 

        5.    Counterparts.    This Participation Agreement may be executed in any number of counterparts, each of which shall
be an original, but all of which together shall constitute one instrument. 

        6.    Successors and Assigns.    This Participation Agreement shall be binding upon, and shall inure to the benefit
of, Assignor and Assignee and their respective successors and assigns. 

   

   

   

[Signature page to follow]

2

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

	

 	
 	

/s/  W. DONALD BRUNSON      
 W. Donald Brunson
	

 	
 	

 	

 
	

 	
 	

/s/  CARY M. GROSSMAN      
 Cary M. Grossman
	

 	
 	

 	

 
	

 	
 	

/s/  JEFFREY P. SANGALIS      
 Jeffrey P. Sangalis
	

 	
 	

 	

 
	

 	
 	

/s/  SCOTT CLINGAN      
 Scott Clingan

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Exhibit 10.14

WARRANT PURCHASE PARTICIPATION AGREEMENT

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