Document:

NEITHER
      THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES
      HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
      SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
      REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
      ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
      EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
      AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
      REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
      SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
      TO
      SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
      COMPANY. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF THESE
      SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT SECURED
      BY SUCH SECURITIES.

     

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    FREEDOM
      FINANCIAL HOLDINGS, INC.

     

    WARRANT

     

    Warrant
      No. [ ] Original
      Issue Date: [*] ,
      2007

     

    Freedom
      Financial Holdings, Inc., a Maryland corporation (the
"Company"), hereby certifies that, as partial compensation for
      placement agent services, Alaron Financial Services Inc. or its registered
      assigns (the "Holder"), is entitled to purchase from the
      Company up to a total of [•] shares of Common Stock (each such
      share, a "Warrant Share" and all such shares, the
"Warrant Shares"), at any time and from time to time from
      and
      after one (1) year from the effective date of the Registration Statement
      (defined below) and through and including 5 years from the effective date of
      the
      Registration Statement (the "Expiration Date"), and subject to
      the following terms and conditions: 

     

    1.  Definitions.
      As used
      in this Warrant, the following terms shall have the respective definitions
      set
      forth in this Section 1. 

     

    "Affiliate"
      means
      any Person that, directly or indirectly through one or more intermediaries,
      controls or is controlled by or is under common control with a Person, as such
      terms are used in and construed under Rule 144.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    "Business
      Day"
      means
      any day except Saturday, Sunday and any day that is a federal legal holiday
      in
      the United States or a day on which banking institutions in the State of
      Illinois are authorized or required by law or other government action to
      close.

     

    "Common
      Stock"
      means
      the common stock of the Company, $.001 par value per share, and any securities
      into which such common stock may hereafter be reclassified.

     

    "Exchange
      Act"
      means
      the Securities Exchange Act of 1934, as amended. 

     

    "Exercise
      Price" means
      $2.50, subject to adjustment in accordance with Section 10.

     

    "Fundamental
      Transaction"
      means
      any of the following: (1) the Company effects any merger or consolidation of
      the
      Company with or into another Person, (2) the Company effects any sale of all
      or
      substantially all of its assets in one or a series of related transactions,
      (3)
      any tender offer or exchange offer (whether by the Company or another Person)
      is
      completed pursuant to which holders of Common Stock are permitted to tender
      or
      exchange their shares for other securities, cash or property, or (4) the Company
      effects any reclassification of the Common Stock or any compulsory share
      exchange pursuant to which the Common Stock is effectively converted into or
      exchanged for other securities, cash or property.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    “Illinois
      Courts”
      means
      the state and federal courts sitting in the City of Chicago,
      Illinois.

     

    “Original
      Issue Date”
      means
      the Original Issue Date first set forth on the first page of this
      Warrant.

     

    "Person"
      means an
      individual or corporation, partnership, trust, incorporated or unincorporated
      association, joint venture, limited liability company, joint stock company,
      government (or an agency or subdivision thereof) or other entity of any
      kind.

     

    “Registration
      Expenses” means
      all
      registration filing fees, reasonable professional fees and other reasonable
      expenses of the Company’s compliance with federal, state and other securities
      laws (including fees and disbursements of counsel for the underwriters in
      connection with state or other securities law qualifications and registrations),
      printing expenses, messenger, telephone and delivery expenses; reasonable fees
      and disbursements of counsel for the Company and reasonable fees and
      disbursements for counsel for the Holder or any such holders of the Securities
      (as defined in section 4(a)(i)).

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    “Registration
      Statement”
      means
      the Registration Statement on Form SB-2 initially filed with the Commission
      on
      February 8, 2007, including any and all amendments thereto.

     

    "Rule
      144"
      means
      Rule 144 promulgated by the Securities and Exchange Commission pursuant to
      the
      Securities Act, as such Rule may be amended from time to time, or any similar
      rule or regulation hereafter adopted by the Securities and Exchange Commission
      having substantially the same effect as such Rule.

     

    "Securities
      Act"
      means
      the Securities Act of 1933, as amended.

     

    "Trading
      Day"
      means
      (i) a day on which the Common Stock is traded on a Trading Market (other than
      the OTC Bulletin Board), or (ii) if the Common Stock is not listed on a Trading
      Market (other than the OTC Bulletin Board), a day on which the Common Stock
      is
      traded in the over-the-counter market, as reported by the OTC Bulletin Board,
      or
      (iii) if the Common Stock is not quoted on any Trading Market, a day on which
      the Common Stock is quoted in the over-the-counter market as reported by the
      Pink Sheets, LLC (or any similar organization or agency succeeding to its
      functions of reporting prices); provided, that in the event that the Common
      Stock is not listed or quoted as set forth in (i), (ii) and (iii) hereof, then
      Trading Day shall mean a Business Day.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    "Trading
      Market"
      means
      whichever of the New York Stock Exchange, the American Stock Exchange, the
      NASDAQ National Market, the NASDAQ SmallCap Market or OTC Bulletin Board on
      which the Common Stock is listed or quoted for trading on the date in
      question.

     

    "Warrant
      Shares" means
      the
      shares of Common Stock issuable upon exercise of this Warrant.

     

    2.  Registration
      of Warrant.
      The
      Company shall register this Warrant upon records to be maintained by the Company
      for that purpose (the "Warrant
      Register"),
      in the
      name of the record Holder hereof from time to time. The Company may deem and
      treat the registered Holder of this Warrant as the absolute owner hereof for
      the
      purpose of any exercise hereof or any distribution to the Holder, and for all
      other purposes, absent actual notice to the contrary.

     

    3.  Registration
      of Transfers.
      The
      Company shall register the transfer of any portion of this Warrant in the
      Warrant Register, upon surrender of this Warrant, with the Form of Assignment
      attached hereto duly completed and signed, to the Company at its address
      specified herein. Upon any such registration or transfer, a new Warrant to
      purchase Common Stock, in substantially the form of this Warrant (any such
      new
      Warrant, a "New
      Warrant"),
      evidencing the portion of this Warrant so transferred shall be issued to the
      transferee and a New Warrant evidencing the remaining portion of this Warrant
      not so transferred, if any, shall be issued to the transferring Holder. The
      acceptance of the New Warrant by the transferee thereof shall be deemed the
      acceptance by such transferee of all of the rights and obligations of a holder
      of a Warrant. 

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    4. Registration
      Rights.
      

    

    (a)
      For
      a
      period not exceeding seven (7) years from the date of commencement of sales
      in
      the Company’s initial public offering of securities registered pursuant to the
      Securities Act, to the extent the Warrant Shares have not already been
      registered in the Registration Statement and continue to be salable, whenever
      the Company proposes to register any of its securities under the Securities
      Act,
      whether
      for its own account or for the account of another stockholder (except for the
      registration of securities to be offered pursuant to an employee benefit plan
      on
      Form S-8, pursuant to a registration made on Form S-4 or any successor forms
      then in effect) at any time, and the registration form to be used may be used
      for the registration of the Securities (a “Piggyback
      Registration”),
      it
      will so notify in writing the Holder and any such holders of the Securities
      no
      later than forty-five (45) days prior to the anticipated filing date. The
      Company will include in the Piggyback Registration all Securities with respect
      to which the Company has received written requests for inclusion within fifteen
      (15) business days after the applicable holder’s receipt of the Company’s
      notice. The Holder or any such holders of the Securities may withdraw all or
      any
      part of the Securities from a Piggyback Registration at any time before ten
      (10)
      business days prior to the effective date of the Piggyback Registration. In
      any
      Piggyback Registration, the Company, the Holder or any such holders of the
      Securities and any Person who hereafter becomes entitled to register its
      securities in a registration initiated by the Company must sell their securities
      on the same terms and conditions. The Company shall pay or reimburse to the
      Holder or any such holders of the Securities included in a Piggyback
      Registration all Registration Expenses of those holders in connection with
      any
      Piggyback Registration.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b)
      In
      respect of the Registration Statement, or in the event of a registration
      pursuant to the provisions of this Section 4, the Company shall use its best
      efforts to cause the Warrant Shares so registered to be registered or qualified
      for sale under the securities or blue sky laws of such jurisdictions as the
      Holder or such holders may reasonably request; provided, however, that the
      Company shall not be required to qualify to do business in any state by reason
      of this Section 4(b) in which it is not otherwise required to qualify to do
      business and provided further, that the Company has no obligation to qualify
      the
      Warrant Shares where such qualification would cause any unreasonable delay
      or
      expenditure by the Company.

    

    (c)
      The
      Company shall keep effective the Registration Statement and any registration
      or
      qualification contemplated by this Section 4, and shall from time to time amend
      or supplement each applicable registration statement, preliminary prospectus,
      final prospectus, application, document and communication for such period of
      time as shall be required to permit the Holder or such holders to complete
      the
      offer and sale of the Warrant Shares covered thereby. 

    

    (d)
      In
      the event of a registration pursuant to the provisions of this Section 4, the
      Company shall furnish to the Holder and to each such holder such reasonable
      number of copies of the registration statement and of each amendment and
      supplement thereto (in each case, including all exhibits), such reasonable
      number of copies of each prospectus contained in such registration statement
      and
      each supplement or amendment thereto (including each preliminary prospectus),
      all of which shall conform to the requirements of the Securities Act and the
      rules and regulations thereunder, and such other documents as the Holder or
      such
      holders may reasonably request in order to facilitate the disposition of the
      Warrant Shares included in such registration.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (e)
      In
      the event of a registration pursuant to the provisions of this Section 4, the
      Company shall furnish the Holder and each holder of any Warrant Shares so
      registered with an opinion of its counsel to the effect that (i) the
      registration statement has become effective under the Securities Act and no
      order suspending the effectiveness of the registration statement preventing
      or
      suspending the use of the registration statement, preventing or suspending
      the
      use of the registration statement, any preliminary prospectus, any final
      prospectus, or any amendment or supplement thereto has been issued, nor to
      such
      counsel’s actual knowledge has the Securities and Exchange Commission or any
      securities or blue sky authority of any jurisdiction instituted or threatened
      to
      institute any proceedings with respect to such an order and (ii) the
      registration statement and each prospectus forming a part thereof (including
      each preliminary prospectus), and any amendment or supplement thereto, complies
      as to form with the Act and the rules and regulations thereunder. Such counsel
      shall also provide a Blue Sky Memorandum setting forth the jurisdictions in
      which the Warrant Shares have been registered or qualified for
      sale.

    

    (f)
      The
      Company agrees that until all the Warrant Shares have been sold under a
      registration statement or pursuant to Rule 144 under the Securities Act, it
      shall keep current in filing all reports, statements and other materials
      required to be filed with the Commission to permit holders of the Warrant Shares
      to sell such securities under Rule 144.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    (g)
      The
      Holder and any holders who propose to register their Warrant Shares under the
      Securities Act shall execute and deliver to the Company a selling stockholder
      questionnaire on a form to be provided by the Company.

    

    (h)
      The
      Company shall not be required by the terms hereof to file a registration
      statement if, in the opinion of counsel to the holders of the Warrant and
      Warrant Shares and counsel for the Company (or, should they not agree, in the
      opinion of another counsel experienced in securities law matters acceptable
      to
      counsel for the holders of the Warrants and Warrant Shares and the Company),
      the
      proposed public offering or other transfer as to which such registration
      statement is requested to be filed is exempt from applicable federal and state
      securities laws, rules, regulations and would result in unaffiliated purchasers
      or transferees obtaining securities that are not restricted securities as that
      term is defined in Rule 144 under the Securities Act. 

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    5.  Transfer,
      Exercise and Duration of Warrants.
      

     

    (a)  This
      Warrant may not be sold during the offering, or sold, transferred, assigned,
      pledged, or hypothecated, or be the subject of any hedging, short sale,
      derivative, put, or call transaction that would result in the effective economic
      disposition of the securities by any person for a period of 180 days immediately
      following the date of effectiveness or commencement of sales of the public
      offering, except as provided in Section 2710(g)(2) of the NASD Rules of Fair
      Practice. 

     

    (b)  This
      Warrant shall be exercisable by the registered Holder at any time and from
      time
      to time on or after one year from the effective date of the Registration
      Statement through and including the Expiration Date. At 6:30 p.m., Eastern
      Standard Time, on the Expiration Date, the portion of this Warrant not exercised
      prior thereto shall be and become void and of no value. The Company may not
      call
      or redeem any portion of this Warrant without the prior written consent of
      the
      affected Holder. 

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    6.  Delivery
      of Warrant Shares.

     

    (a)  To
      effect
      exercises hereunder, the Holder shall not be required to physically surrender
      this Warrant unless the aggregate Warrant Shares represented by this Warrant
      is
      being exercised. Upon delivery of the Exercise Notice (in the form attached
      hereto) to the Company (with the attached Warrant Shares Exercise Log) at its
      address for notice set forth herein and upon payment of the Exercise Price
      multiplied by the number of Warrant Shares that the Holder intends to purchase
      hereunder, the Company shall promptly (but in no event later than three Trading
      Days after the Date of Exercise (as defined herein)) issue and deliver to the
      Holder, a certificate for the Warrant Shares issuable upon such exercise. The
      Company shall, upon request of the Holder and subsequent to the date on which
      a
      registration statement covering the resale of the Warrant Shares has been
      declared effective by the Securities and Exchange Commission, use its reasonable
      best efforts to deliver Warrant Shares hereunder electronically through the
      Depository Trust Corporation or another established clearing corporation
      performing similar functions, if available, provided,
      that,
      the Company may, but will not be required to change its transfer agent if its
      current transfer agent cannot deliver Warrant Shares electronically through
      the
      Depository Trust Corporation. A "Date
      of Exercise"
      means
      the date on which the Holder shall have delivered to the Company: (i) the
      Exercise Notice (with the Warrant Exercise Log attached to it), appropriately
      completed and duly signed and (ii) payment of the Exercise Price for the number
      of Warrant Shares so indicated by the Holder to be purchased.

     

    (b)  If
      by the
      third Trading Day after a Date of Exercise the Company fails to deliver the
      required number of Warrant Shares in the manner required pursuant to Section
      6(a), then the Holder will have the right to rescind such exercise.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (c)  The
      Company's obligations to issue and deliver Warrant Shares in accordance with
      the
      terms hereof are absolute and unconditional, irrespective of any action or
      inaction by the Holder to enforce the same, any waiver or consent with respect
      to any provision hereof, the recovery of any judgment against any Person or
      any
      action to enforce the same, or any setoff, counterclaim, recoupment, limitation
      or termination, or any breach or alleged breach by the Holder or any other
      Person of any obligation to the Company or any violation or alleged violation
      of
      law by the Holder or any other Person, and irrespective of any other
      circumstance which might otherwise limit such obligation of the Company to
      the
      Holder in connection with the issuance of Warrant Shares. Nothing herein shall
      limit a Holder's right to pursue any other remedies available to it hereunder,
      at law or in equity including, without limitation, a decree of specific
      performance and/or injunctive relief with respect to the Company's failure
      to
      timely deliver certificates representing Warrant Shares upon exercise of the
      Warrant as required pursuant to the terms hereof.

     

    7.  Charges,
      Taxes and Expenses.
      Issuance and delivery of Warrant Shares upon exercise of this Warrant shall
      be
      made without charge to the Holder for any issue or transfer tax, withholding
      tax, transfer agent fee or other incidental tax or expense in respect of the
      issuance of such certificates, all of which taxes and expenses shall be paid
      by
      the Company; provided, however, that the Company shall not be required to pay
      any tax which may be payable in respect of any transfer involved in the
      registration of any certificates for Warrant Shares or Warrants in a name other
      than that of the Holder. The Holder shall be responsible for all other tax
      liability that may arise as a result of holding or transferring this Warrant
      or
      receiving Warrant Shares upon exercise hereof.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    8.  Replacement
      of Warrant.
      If this
      Warrant is mutilated, lost, stolen or destroyed, the Company shall issue or
      cause to be issued in exchange and substitution for and upon cancellation
      hereof, or in lieu of and substitution for this Warrant, a New Warrant, but
      only
      upon receipt of evidence reasonably satisfactory to the Company of such loss,
      theft or destruction and customary and reasonable indemnity (which shall not
      include a surety bond), if requested. Applicants for a New Warrant under such
      circumstances shall also comply with such other reasonable regulations and
      procedures and pay such other reasonable third-party costs as the Company may
      prescribe. If a New Warrant is requested as a result of a mutilation of this
      Warrant, then the Holder shall deliver such mutilated Warrant to the Company
      as
      a condition precedent to the Company’s obligation to issue the New
      Warrant.

     

    9.  Reservation
      of Warrant Shares.
      The
      Company covenants that it will at all times reserve and keep available out
      of
      the aggregate of its authorized but unissued and otherwise unreserved Common
      Stock, solely for the purpose of enabling it to issue Warrant Shares upon
      exercise of this Warrant as herein provided, the number of Warrant Shares which
      are then issuable and deliverable upon the exercise of this entire Warrant,
      free
      from preemptive rights or any other contingent purchase rights of Persons other
      than the Holder (taking into account the adjustments and restrictions of Section
      10). The Company covenants that all Warrant Shares so issuable and deliverable
      shall, upon issuance and the payment of the applicable Exercise Price in
      accordance with the terms hereof, be duly and validly authorized, issued and
      fully paid and nonassessable.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    10.  Certain
      Adjustments.
      The
      Exercise Price and number of Warrant Shares issuable upon exercise of this
      Warrant are subject to adjustment from time to time as set forth in this Section
      10.

     

    (a)  Stock
      Dividends and Splits.
      If the
      Company, at any time while this Warrant is outstanding, (i) pays a stock
      dividend on its Common Stock or otherwise makes a distribution on any class
      of
      capital stock that is payable in shares of Common Stock, (ii) subdivides
      outstanding shares of Common Stock into a larger number of shares, or (iii)
      combines outstanding shares of Common Stock into a smaller number of shares,
      then in each such case the Exercise Price shall be multiplied by a fraction
      of
      which the numerator shall be the number of shares of Common Stock outstanding
      immediately before such event and of which the denominator shall be the number
      of shares of Common Stock outstanding immediately after such event. Any
      adjustment made pursuant to clause (i) of this paragraph shall become effective
      immediately after the record date for the determination of stockholders entitled
      to receive such dividend or distribution, and any adjustment pursuant to clause
      (ii) or (iii) of this paragraph shall become effective immediately after the
      effective date of such subdivision or combination.

     

    (b)  Fundamental
      Transactions.
      If, at
      any time while this Warrant is outstanding there is a Fundamental Transaction,
      then the Holder shall have the right thereafter to receive, upon exercise of
      this Warrant, the same amount and kind of securities, cash or property as it
      would have been entitled to receive upon the occurrence of such Fundamental
      Transaction if it had been, immediately prior to such Fundamental Transaction,
      the holder of the number of Warrant Shares then issuable upon exercise in full
      of this Warrant (the "Alternate
      Consideration").
      

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

      For
        purposes of any such exercise, the determination of the Exercise Price shall
        be
        appropriately adjusted to apply to such Alternate Consideration based on
        the
        amount of Alternate Consideration issuable in respect of one share of Common
        Stock in such Fundamental Transaction, and the Company shall apportion the
        Exercise Price among the Alternate Consideration in a reasonable manner
        reflecting the relative value of any different components of the Alternate
        Consideration. If holders of Common Stock are given any choice as to the
        securities, cash or property to be received in a Fundamental Transaction,
        then
        the Holder shall be given the same choice as to the Alternate Consideration
        it
        receives upon any exercise of this Warrant following such Fundamental
        Transaction. At the Holder's option and request, any successor to the Company
        or
        surviving entity in such Fundamental Transaction shall, either (1) issue
        to the
        Holder a new warrant substantially in the form of this Warrant and consistent
        with the foregoing provisions and evidencing the Holder's right to purchase
        the
        Alternate Consideration for the aggregate Exercise Price upon exercise thereof,
        or (2) purchase the Warrant from the Holder for a purchase price, payable
        in
        cash within five Trading Days after such request (or, if later, on the effective
        date of the Fundamental Transaction), equal to the Black Scholes value of
        the
        remaining unexercised portion of this Warrant on the date of such request.
        The
        terms of any agreement pursuant to which a Fundamental Transaction is effected
        shall include terms requiring any such successor or surviving entity to comply
        with the provisions of this paragraph (b) and insuring that the Warrant (or
        any
        such replacement security) will be similarly adjusted upon any subsequent
        transaction analogous to a Fundamental Transaction. 

    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (c)  Number
      of Warrant Shares.
      Simultaneously with any adjustment to the Exercise Price pursuant to this
      Section 10, the number of Warrant Shares that may be purchased upon exercise
      of
      this Warrant shall be increased or decreased proportionately, so that after
      such
      adjustment the aggregate Exercise Price payable hereunder for the adjusted
      number of Warrant Shares shall be the same as the aggregate Exercise Price
      in
      effect immediately prior to such adjustment.

     

    (d)  Calculations.
      All
      calculations under this Section 10 shall be made to the nearest cent or the
      nearest 1/100th
      of a
      share, as applicable. The number of shares of Common Stock outstanding at any
      given time shall not include shares owned or held by or for the account of
      the
      Company, and the disposition of any such shares shall be considered an issue
      or
      sale of Common Stock.

     

    (e)  Notice
      of Adjustments.
      Upon
      the occurrence of each adjustment pursuant to this Section 10, the Company
      at
      its expense will promptly compute such adjustment in accordance with the terms
      of this Warrant and prepare a certificate setting forth such adjustment,
      including a statement of the adjusted Exercise Price and adjusted number or
      type
      of Warrant Shares or other securities issuable upon exercise of this Warrant
      (as
      applicable), describing the transactions giving rise to such adjustments and
      showing in detail the facts upon which such adjustment is based. Upon written
      request, the Company will promptly deliver a copy of each such certificate
      to
      the Holder and to the Company's Transfer Agent.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (f)  Notice
      of Corporate Events.
      If the
      Company (i) declares a dividend or any other distribution of cash, securities
      or
      other property in respect of its Common Stock, including without limitation
      any
      granting of rights or warrants to subscribe for or purchase any capital stock
      of
      the Company, (ii) authorizes or approves, enters into any agreement
      contemplating or solicits stockholder approval for any Fundamental Transaction
      or (iii) authorizes the voluntary dissolution, liquidation or winding up of
      the
      affairs of the Company, then the Company shall deliver to the Holder a notice
      describing the material terms and conditions of such transaction (but only
      to
      the extent such disclosure would not result in the dissemination of material,
      non-public information to the Holder) at least 10 calendar days prior to the
      applicable record or effective date on which a Person would need to hold Common
      Stock in order to participate in or vote with respect to such transaction,
      and
      the Company will take all steps reasonably necessary in order to insure that
      the
      Holder is given the practical opportunity to exercise this Warrant prior to
      such
      time so as to participate in or vote with respect to such transaction; provided,
      however, that the failure to deliver such notice or any defect therein shall
      not
      affect the validity of the corporate action required to be described in such
      notice.

     

    11.  Payment
      of Exercise Price.
      The
      Holder shall pay the Exercise Price by delivery of the immediately available
      funds.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    12.  Limitations
      on Exercise.
      Notwithstanding anything to the contrary contained herein, the number of Warrant
      Shares that may be acquired by the Holder upon any exercise of this Warrant
      (or
      otherwise in respect hereof) shall be limited to the extent necessary to insure
      that, following such exercise (or other issuance), the total number of shares
      of
      Common Stock then beneficially owned by such Holder and its Affiliates and
      any
      other Persons whose beneficial ownership of Common Stock would be aggregated
      with the Holder's for purposes of Section 13(d) of the Exchange Act, does not
      exceed 9.999% of the total number of issued and outstanding shares of Common
      Stock (including for such purpose the shares of Common Stock issuable upon
      such
      exercise). For such purposes, beneficial ownership shall be determined in
      accordance with Section 13(d) of the Exchange Act and the rules and regulations
      promulgated thereunder. This provision shall not restrict the number of shares
      of Common Stock which a Holder may receive or beneficially own in order to
      determine the amount of securities or other consideration that such Holder
      may
      receive in the event of a Fundamental Transaction as contemplated in Section
      10
      of this Warrant. This restriction may not be waived.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    13.  No
      Fractional Shares.
      No
      fractional shares of Warrant Shares will be issued in connection with any
      exercise of this Warrant. In lieu of any fractional shares which would,
      otherwise be issuable, the Company shall pay cash equal to the product of such
      fraction multiplied by the closing price of one Warrant Share as reported by
      the
      applicable Trading Market on the date of exercise.

     

    14.  Notices.
      Any and
      all notices or other communications or deliveries hereunder (including, without
      limitation, any Exercise Notice) shall be in writing and shall be deemed given
      and effective on the earliest of (i) the date of transmission, if such notice
      or
      communication is delivered via facsimile at the facsimile number specified
      in
      this Section prior to 6:30 p.m., (Eastern Standard Time, on a Trading Day),
      (ii)
      the next Trading Day after the date of transmission, if such notice or
      communication is delivered via facsimile at the facsimile number specified
      in
      this Section on a day that is not a Trading Day or later than 6:30 p.m., Eastern
      Standard Time, on any Trading Day, (iii) the Trading Day following the date
      of
      mailing, if sent by nationally recognized overnight courier service, or (iv)
      upon actual receipt by the party to whom such notice is required to be given.
      The addresses for such communications shall be: (i) if to the Company, 6615
      Brotherhood Way, Suite A, Fort Wayne, Indiana 46825, Attention: Brian Kistler,
      and to Weintraub Law Group PC at 10085 Carroll Canyon Road, Suite 210, San
      Diego, California 92131 (or such other address as the Company shall indicate
      in
      writing in accordance with this Section), or (ii) if to the Holder, to the
      addresses appearing on the Warrant Register or such other address as the Holder
      may provide to the Company in accordance with this Section.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    15.  Warrant
      Agent.
      The
      Company shall serve as warrant agent under this Warrant. Upon 10 days' notice
      to
      the Holder, the Company may appoint a new warrant agent. Any corporation into
      which the Company or any new warrant agent may be merged or any corporation
      resulting from any consolidation to which the Company or any new warrant agent
      shall be a party or any corporation to which the Company or any new warrant
      agent transfers substantially all of its corporate trust or shareholders
      services business shall be a successor warrant agent under this Warrant without
      any further act. Any such successor warrant agent shall promptly cause notice
      of
      its succession as warrant agent to be mailed (by first class mail, postage
      prepaid) to the Holder at the Holder's last address as shown on the Warrant
      Register.

     

    16.  Miscellaneous.

     

    (a)  This
      Warrant shall be binding on and inure to the benefit of the parties hereto
      and
      their respective successors and assigns. Subject to the preceding sentence,
      nothing in this Warrant shall be construed to give to any Person other than
      the
      Company and the Holder any legal or equitable right, remedy or cause of action
      under this Warrant. This Warrant may be amended only in writing signed by the
      Company and the Holder and their successors and assigns.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b)  All
      questions concerning the construction, validity, enforcement and interpretation
      of this Warrant shall be governed by and construed and enforced in accordance
      with the internal laws of the State of Illinois, without regard to the
      principles of conflicts of law thereof. Each party agrees that all legal
      proceedings concerning the interpretations, enforcement and defense of this
      Warrant and the transactions herein contemplated (“Proceedings”)
      (whether brought against a party hereto or its respective Affiliates, employees
      or agents) shall be commenced exclusively in the Illinois Courts. Each party
      hereto hereby irrevocably submits to the exclusive jurisdiction of the Illinois
      Courts for the adjudication of any dispute hereunder or in connection herewith
      or with any transaction contemplated hereby or discussed herein, and hereby
      irrevocably waives, and agrees not to assert in any Proceeding, any claim that
      it is not personally subject to the jurisdiction of any Illinois Court, or
      that
      such Proceeding has been commenced in an improper or inconvenient forum. Each
      party hereto hereby irrevocably waives personal service of process and consents
      to process being served in any such Proceeding by mailing a copy thereof via
      registered or certified mail or overnight delivery (with evidence of delivery)
      to such party at the address in effect for notices to it under this Warrant
      and
      agrees that such service shall constitute good and sufficient service of process
      and notice thereof. Nothing contained herein shall be deemed to limit in any
      way
      any right to serve process in any manner permitted by law. Each party hereto
      hereby irrevocably waives, to the fullest extent permitted by applicable law,
      any and all right to trial by jury in any legal proceeding arising out of or
      relating to this Warrant or the transactions contemplated hereby. If either
      party shall commence a Proceeding to enforce any provisions of this Warrant,
      then the prevailing party in such Proceeding shall be reimbursed by the other
      party for its attorney’s fees and other costs and expenses incurred with the
      investigation, preparation and prosecution of such Proceeding.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (c)  The
      headings herein are for convenience only, do not constitute a part of this
      Warrant and shall not be deemed to limit or affect any of the provisions
      hereof.

     

    (d)  In
      case
      any one or more of the provisions of this Warrant shall be invalid or
      unenforceable in any respect, the validity and enforceability of the remaining
      terms and provisions of this Warrant shall not in any way be affected or
      impaired thereby and the parties will attempt in good faith to agree upon a
      valid and enforceable provision which shall be a commercially reasonable
      substitute therefor, and upon so agreeing, shall incorporate such substitute
      provision in this Warrant.

     

    (e)  Prior
      to
      exercise of this Warrant, the Holder hereof shall not, by reason of by being
      a
      Holder, be entitled to any rights of a stockholder with respect to the Warrant
      Shares.

     

    (f) This
      Warrant (together with the other agreements and documents being delivered
      pursuant to or in connection with this Warrant) constitutes the entire agreement
      of the parties hereto with respect to the subject matter hereof, and supersedes
      all prior agreements and understandings of the parties, oral and written, with
      respect to the subject matter hereof.

    

    (g) The
      failure of the Company or the Holder to at any time enforce any of the
      provisions of this Warrant shall not be deemed or construed to be a waiver
      of
      any such provision, nor to in any way affect the validity of this Warrant or
      any
      provision hereof or the right of the Company or any Holder to thereafter enforce
      each and every provision of this Warrant. No waiver of any breach,
      non-compliance or non-fulfillment of any of the provisions of this Warrant
      shall
      be effective unless set forth in a written instrument executed by the party
      or
      parties against whom or which enforcement of such waiver is sought; and no
      waiver of any such breach, non-compliance or non-fulfillment shall be construed
      or deemed to be a waiver of any other or subsequent breach, non-compliance
      or
      non-fulfillment. 

    
 

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK,

     

    SIGNATURE
      PAGE FOLLOWS]

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by
      its
      authorized officer as of the date first indicated above.

     

    
      	 	 	 
	 	FREEDOM
              FINANCIAL HOLDINGS, INC.
	 
 	 
 	 
 
	Date: 	By:  	 
	 	
              

            
	 	Title 

    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    EXERCISE
      NOTICE

     

    FREEDOM
      FINANCIAL HOLDINGS, INC. 

     

    WARRANT
      DATED FEBRUARY __, 2007

     

    

     

    The
      undersigned Holder hereby irrevocably elects to purchase _____________ shares
      of
      Common Stock pursuant to the above referenced Warrant. Capitalized terms used
      herein and not otherwise defined have the respective meanings set forth in
      the
      Warrant.

     

    
      	
              (1)

            	
              The
                undersigned Holder hereby exercises its right to purchase
                _________________ Warrant Shares pursuant to the
                Warrant.

            

    

     

    
      	
              (2)

            	
              The
                holder shall pay the sum of $____________ to the Company in accordance
                with the terms of the Warrant.

            

    

     

    
      	
              (3)

            	
              Pursuant
                to this Exercise Notice, the Company shall deliver to the holder
                _______________ Warrant Shares in accordance with the terms of the
                Warrant.

            

    

     

    
      	
              (4)

            	
              By
                its delivery of this Exercise Notice, the undersigned represents
                and
                warrants to the Company that in giving effect to the exercise evidenced
                hereby the Holder will not beneficially own in excess of the number
                of
                shares of Common Stock (determined in accordance with Section 13(d)
                of the
                Securities Exchange Act of 1934) permitted to be owned under Section
                11 of
                this Warrant to which this notice
                relates.

            

    

    

    
      	 	 	 
	 	 	 
	
              Dated:
                ,
                

            	 	
              Name
                of Holder:

            
	 	 	 
	 	 	
              (Print)
                

            
	 	 	 
	 	 	
              By:

            
	 	 	
              Name:

            
	 	 	
              Title:

            
	 	 	 
	 	 	
              (Signature
                must conform in all respects to name of holder as specified on the
                face of
                the Warrant)

            

    

    

     

    Warrant
      Shares Exercise Log

     

    
      	
              Date

            	
              Number
                of Warrant Shares Available to be Exercised

            	
              Number
                of Warrant Shares Exercised

            	
              Number
                of Warrant Shares Remaining to be Exercised

            
	 	 	 	 

    

    

     

    freedom
      financial holdings, Inc. 

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    WARRANT
      DATED February __, 2007

     

    WARRANT
      NO. [ ]

     

    FORM
      OF
      ASSIGNMENT

     

    [To
      be
      completed and signed only upon transfer of Warrant]

     

    FOR
      VALUE
      RECEIVED, the undersigned hereby sells, assigns and transfers unto
      ________________________________ the right represented by the above-captioned
      Warrant to purchase ____________ shares of Common Stock to which such Warrant
      relates and appoints ________________ attorney to transfer said right on the
      books of the Company with full power of substitution in the
      premises.

     

    Dated: _______________,
      ____

     

    _______________________________________

     

    (Signature
      must conform in all respects to name of holder as specified on the face of
      the
      Warrant)

     

    _______________________________________

     

    Address
      of Transferee

     

    _______________________________________

     

    _______________________________________

     

    In
      the
      presence of:

     

    __________________________ESCROW
      AGREEMENT

     

    between

     

    FREEDOM
      FINANCIAL HOLDINGS, INC.,

     

    ALARON
      FINANCIAL SERVICES, INC.

     

    and

     

    TOWER
      TRUST COMPANY

     

    Dated
      as of August 9, 2007

     

    ACCOUNT
      NUMBER(S) 00-0496

     

    SHORT
      TITLE OF ACCOUNT Freedom Financial Holdings, Inc. - Escrow

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    ESCROW
      AGREEMENT made
      this
      9th
      day of
      August, 2007 by and between Tower Trust Company (“Escrow Agent”), Freedom
      Financial Holdings, Inc. (the “Company”) and Alaron Financial Services, Inc.
      (the “Underwriter”).

     

    The
      Company, Underwriter and Escrow Agent hereby agree that, in consideration of
      the
      mutual promises and covenants contained herein, Escrow Agent shall hold in
      escrow and shall distribute Escrow Property (as defined herein) in accordance
      with and subject to the following Instructions and Terms and
      Conditions:

     

    WHEREAS,
      the Company proposes to offer for sale to investors through one or more
      registered broker-dealers a minimum of 375,000 shares of common stock
      (hereinafter referred to as the "Securities") (the “Minimum Offering Amount”) up
      to a maximum of 1,500,000 shares of common stock (the “Maximum Offering Amount”)
      at a price of $2.00 per share (the "Proceeds").

     

    WHEREAS,
      the Underwriter intends to sell the Securities as the Company's agent on a
      best-efforts basis for the Securities in a public offering (the
      "Offering").

     

    WHEREAS,
      the Company and the Underwriter desire to establish an escrow account in which
      funds received from subscribers will be deposited pending completion of the
      escrow period. Tower Trust Company agrees to serve as Escrow Agent in accordance
      with the terms and conditions set forth herein.

     

    WHEREAS,
      the term Selected Dealer as used herein shall include the Underwriter and other
      co-underwriters and/or other selected dealers as part of the selling group.
      All
      Selected Dealers shall be bound by this Agreement. However, for purposes of
      communications and directives, the Escrow Agent must only accept those signed
      by
      Alaron Financial Services, Inc.

     

    NOW
      THEREFORE, in consideration of the foregoing, it is hereby agreed as follows:
      

     

     

    I.
      INSTRUCTIONS:

     

    1. 
      Establishment of Escrow Account. 

     

    On
      or
      prior to the Offering Period Commencement Date (as defined below), the parties
      shall establish an interest-bearing escrow account with the Escrow Agent, which
      escrow account shall be entitled Freedom Financial Holdings, Inc. - Escrow
      (the
      "Escrow Account"). The Selected Dealer will instruct subscribers to make checks
      for subscriptions payable to the order of the Escrow Agent. Any checks received
      that are made payable to a party other than the Escrow Agent shall be returned
      to the Selected Dealer who submitted the check.

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

     

    2. Escrow
      Property

     

    The
      property and/or funds deposited or to be deposited with Escrow Agent shall
      be as
      follows:

     

    A. Documentation.
      Concurrently with the execution and delivery hereof, the Company is delivering
      to the Escrow Agent one fully executed original copy of the Underwriting
      Agreement and a draft of the registration statement of the Company on Form
      SB-2
      (the "Escrowed Documents"), which represents all of the documents required
      to be
      placed in escrow.

    

    B. Escrowed
      Items.
      Proceeds
      received
      from subscribers will be deposited into the Escrow Account, as defined below,
      (the
      Proceeds collectively with the Escrowed Documents hereinafter are referred
      to as
      "Escrowed Items"). 

    

     

    The
      foregoing property and/or funds, plus all interest, dividends and other
      distributions and payments thereon (collectively the “Distributions”) received
      by Escrow Agent, less any property and/or funds distributed or paid in
      accordance with this Escrow Agreement, are collectively referred to herein
      as
“Escrow Property.”

     

    3. Deposits
      into the Escrow Account. 

     

    The
      Selected Dealer agrees that it shall promptly deliver all monies received from
      subscribers for the payment of the Securities to the Escrow Agent by 12 p.m.
      the
      following business day for deposit in the Escrow Account together with a written
      account of each sale, which account shall set forth, among other things, the
      subscriber's name and address, the number of securities purchased, the amount
      paid therefor, and whether the consideration received was in the form of a
      check, draft, or money order. All monies so deposited in the Escrow Account
      are
      hereinafter referred to as the "Escrow Amount."

     

    4. Collection
      Procedure. 

     

    A. The
      Escrow Agent is hereby authorized to forward each check for collection and,
      upon
      collection of the proceeds of each check, deposit the collected proceeds in
      the
      Escrow Account. As an alternative, the Escrow Agent may telephone the bank
      on
      which the check is drawn to confirm that the check has been paid.

     

    B. Any
      check
      returned unpaid to the Escrow Agent shall be returned to the Selected Dealer
      that submitted the check. In such cases, the Escrow Agent will promptly notify
      the Company of such return.

     

    C. If
      the
      Company rejects any subscription for which the Escrow Agent has already
      collected funds, the Escrow Agent, as instructed by the Company, shall promptly
      issue a refund check to the rejected subscriber. If the Company rejects any
      subscription for which the Escrow Agent has not yet collected funds but has
      submitted the subscriber's check for collection, as instructed by the Company
      the Escrow Agent shall promptly issue a check in the amount of the subscriber's
      check to the rejected subscriber after the Escrow Agent has cleared such funds.
      If the Escrow Agent has not yet submitted a rejected subscriber's check for
      collection, as instructed by the Company the Escrow Agent shall promptly remit
      the subscriber's check directly to the subscriber. 

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

    

     

    5. Escrow
      Period. 

     

    A. The
      Escrow Period shall begin with the commencement of the offering period
      commencing the date the Company’s registration statement on Form SB-2 is
      declared effective by the SEC (the “Offering Period Commencement Date”) and
      shall terminate (the “Termination Date”) upon the earlier to occur of the
      following dates: 

     

    1.
       The
      date
      upon which the Escrow Agent confirms that it has received in the Escrow Account
      gross proceeds of the Maximum Offering Amount;
      or

     

    2.
       The
      expiration of ninety (90) days from the Offering Period Commencement Date if
      the
      Minimum Offering Amount has not been met; or

     

    3.
       The
      date
      upon which a determination is made by the Company and the Underwriter to
      terminate the Offering prior to the sale of the Maximum Offering Amount;
      or

     

    4.
       The
      occurrence of an event listed in Section 7D, below.

     

    B. During
      the escrow period, the Company is aware and understands that it is not entitled
      to any funds received into escrow (except as otherwise provided in this
      agreement) and no amounts deposited in the Escrow Account shall become the
      property of the Company or any other entity, or be subject to the debts of
      the
      Company or any other entity.

     

    6. Investment
      of Escrow Property 

     

    Escrow
      Agent shall invest or reinvest Escrow Property, without distinction between
      principal and income, in taxable money market accounts. Escrow Agent shall
      have
      no liability for any loss arising from or related to any such investment other
      than in accordance with paragraph 4 of the Terms and Conditions in Part II
      of
      this Agreement.

     

    7. Distribution
      of Escrow Property

     

    Escrow
      Agent is directed to hold and distribute the Escrow Property in the following
      manner:

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

    

     

    A. Prior
      to Minimum Offering Amount Being Reached.
      In the
      event the Escrow Agent does not receive the Minimum Offering Amount deposits
      totaling $750,000 on or before the Termination Date, the Escrow Agent shall,
      as
      instructed by the Company, refund to each subscriber the amount received from
      the subscriber, without deduction, penalty, or expense to the subscriber, and
      the Escrow Agent shall notify the Company, the State
      of
      Indiana Securities Division,
      and the
      Selected Dealer in writing of its distribution of the funds. The Company shall
      pay the Escrow Agent a fee of two dollars ($2.00) per check that must be sent
      to
      each subscriber in the event the Minimum Offering Amount is not received. The
      purchase money returned to each subscriber shall be free and clear of any and
      all claims of the Company or any of its creditors and shall include a pro rata
      share of the interest earned based upon the amount invested and the number
      of
      days in escrow. In no event will the Escrow Amount be released to the Company
      until such amount is received by the Escrow Agent in collected funds.
If
      the
      Offering is terminated because the Minimum Offering Amount is not received
      all
      funds deposited in the escrow account will be returned to investors within
      one
      (1) business day or promptly thereafter. For
      purposes of this Agreement, the term "collected funds" shall mean all funds
      received by the Escrow Agent which have cleared normal banking channels and
      are
      in the form of cash. 

     

    B. In
      the
      event that the Escrow Agent has received the Minimum Offering Amount of $750,000
      in collected funds prior to the Termination Date, the collected funds shall
      be
      promptly released to the Company.

     

    C.
       Subsequent
      Weekly Releases. 
      After
      the Minimum Offering Amount has been received and disbursed to the Company,
      the
      Escrow Agent shall release all subsequently collected funds to the Company
      on a
      weekly basis beginning the Wednesday after the Minimum Offering Amount has
      been
      reached and continuing every Wednesday thereafter until the Escrow Period has
      been terminated.

     

    D. Change
      in Material Terms of Offering.
       Changes
      in the material terms of the Offering after the Offering Period Commencement
      Date would terminate the original offer and subscriber would then be entitled
      to
      a refund of their money. Material changes include the following:

     

    
      	 	
              a.

            	
              extension
                of the offering period beyond the disclosed time
                frame;

            

    

    
      	 	
              b.

            	
              change
                in the offering price;

            

    

    
      	 	
              c.

            	
              change
                in the minimum sales requirement;

            

    

    
      	 	
              d.

            	
              change
                to allow sales to affiliates in excess of those already permitted
                in order
                to meet the minimum sales
                requirement;

            

    

    
      	 	
              e.

            	
              change
                in the amount of proceeds necessary to release the proceeds held
                in
                escrow; and

            

    

    
      	 	
              f.

            	
              change
                in the application of proceeds.

            

    

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

    

    

    In
      the
      event that there is a change in the material terms of the Offering which
      requires the return of funds to subscribers, the Company shall instruct the
      Escrow Agent in writing to release funds to each subscriber pursuant to the
      same
      procedure described in Section 7A of this Agreement. 

    

     

    8. Addresses

     

    Notices,
      instructions and other communications shall be sent to Escrow Agent, 116, East
      Berry Street, Fort Wayne, Indiana 46802, and to the Company and Underwriter
      as
      follows:

     

    
      	
               

              Freedom
                Financial Holdings, Inc.

              Attn:
                Brian Kistler

              6615
                Brotherhood Way, Suite A

              Fort
                Wayne, IN 46825

               

              With
                a Copy to:

               

              Weintraub
                Law Group PC

              10085
                Carroll Canyon Road, Suite 230

              San
                Diego, California 92131

            	
               

              Alaron
                Financial Services, Inc.

              Attn:
                David Bonifield

              822
                West Washington Boulevard

              Chicago,
                Illinois 60607

            

    

    

     

    9. Compensation

     

    (a) At
      the
      time of execution of this Escrow Agreement, the Company shall pay Escrow Agent
      an acceptance fee of $1,200.

     

    (b) The
      Company shall be responsible for and shall reimburse Escrow Agent upon demand
      for all expenses, disbursements and advances incurred or made by Escrow Agent
      in
      connection with this Agreement.

     

     

    II.
      TERMS
      AND CONDITIONS:

     

    1. The
      duties, responsibilities and obligations of Escrow Agent shall be limited to
      those expressly set forth herein and no duties, responsibilities or obligations
      shall be inferred or implied. Escrow Agent shall not be subject to, nor required
      to comply with, any other agreement between or among the Company and the
      Underwriter or to which any such party is a party to, even though reference
      thereto may be made herein, or to comply with any direction or instruction
      (other than those contained herein or delivered in accordance with this Escrow
      Agreement) from any party hereto or any entity acting on its behalf. Escrow
      Agent shall not be required to, and shall not, expend or risk any of its own
      funds or otherwise incur any financial liability in the performance of any
      of
      its duties hereunder.

     

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

    

     

    2. This
      Agreement is for the exclusive benefit of the parties hereto and their
      respective successors hereunder, and shall not be deemed to give, either express
      or implied, any legal or equitable right, remedy, or claim to any other entity
      or person whatsoever.

     

    3. If
      at any
      time Escrow Agent is served with any judicial or administrative order, judgment,
      decree, writ or other form of judicial or administrative process which in any
      way affects Escrow Property (including but not limited to orders of attachment
      or garnishment or other forms of levies or injunctions or stays relating to
      the
      transfer of Escrow Property), Escrow Agent is authorized to comply therewith
      in
      any manner as it or its legal counsel of its own choosing deems appropriate;
      and
      if Escrow Agent complies with any such judicial or administrative order,
      judgment, decree, writ or other form of judicial or administrative process,
      Escrow Agent shall not be liable to any of the parties hereto or to any other
      person or entity even though such order, judgment, decree, writ or process
      may
      be subsequently modified or vacated or otherwise determined to have been without
      legal force or effect.

     

    4. (a) Escrow
      Agent shall not be liable for any action taken or omitted or for any loss or
      injury resulting from its actions or its performance or lack of performance
      of
      its duties hereunder in the absence of gross negligence or willful misconduct
      on
      its part. In no event shall Escrow Agent be liable (i) for acting in accordance
      with or relying upon any instruction, notice, demand, certificate or document
      from the Company or Underwriter or any entity acting on behalf of such party,
      (ii) for any consequential, punitive or special damages, (iii) for the acts
      or
      omissions of its nominees, correspondents, designees, subagents or
      subcustodians, or (iv) for an amount in excess of the value of the Escrow
      Property, valued as of the date of deposit.

     

    (b) If
      any
      fees, expenses or costs incurred by, or any obligations owed to, Escrow Agent
      hereunder are not promptly paid when due, Escrow Agent may reimburse itself
      therefor from the Escrow Property and may sell, convey or otherwise dispose
      of
      any Escrow Property for such purpose.

     

    (c) As
      security for the due and punctual performance of any and all of the Company’s
      obligations to Escrow Agent hereunder, now or hereafter arising, the Company,
      hereby pledges, assigns and grants to Escrow Agent a continuing security
      interest in, and a lien on, the Escrow Property and all Distributions thereon
      or
      additions thereto (whether such additions are the result of deposits by the
      Company and/or Underwriter or the investment of Escrow Property). The security
      interest of Escrow Agent shall at all times be valid, perfected and enforceable
      by Escrow Agent against the Company and all third parties in accordance with
      the
      terms of this Escrow Agreement.

     

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

    

     

    (d) Escrow
      Agent may consult with legal counsel at the expense of the the Company as to
      any
      matter relating to this Escrow Agreement, and Escrow Agent shall not incur
      any
      liability in acting in good faith in accordance with any advice from such
      counsel.

     

    (e) Escrow
      Agent shall not incur any liability for not performing any act or fulfilling
      any
      duty, obligation or responsibility hereunder by reason of any occurrence beyond
      the control of Escrow Agent (including but not limited to any act or provision
      of any present or future law or regulation or governmental authority, any act
      of
      God or war, or the unavailability of the Federal Reserve Bank wire or telex
      or
      other wire or communication facility).

     

    5. Unless
      otherwise specifically set forth herein, Escrow Agent shall proceed as soon
      as
      practicable to collect any checks or other collection items at any time
      deposited hereunder. All such collections shall be subject to Escrow Agent’s
      usual collection practices or terms regarding items received by Escrow Agent
      for
      deposit or collection. Escrow Agent shall not be required, or have any duty,
      to
      notify anyone of any payment or maturity under the terms of any instrument
      deposited hereunder, nor to take any legal action to enforce payment of any
      check, note or security deposited hereunder or to exercise any right or
      privilege which may be afforded to the holder of any such security.

     

    6. Escrow
      Agent shall provide to the Company and Underwriter monthly statements
      identifying transactions, transfers or holdings of Escrow Property and each
      such
      statement shall be deemed to be correct and final upon receipt thereof by the
      the Company and Underwriter unless Escrow Agent is notified in writing to the
      contrary within thirty (30) business days of the date of such
      statement.

     

    7. Escrow
      Agent shall not be responsible in any respect for the form, execution, validity,
      value or genuineness of documents or securities deposited hereunder, or for
      any
      description therein, or for the identity, authority or rights of persons
      executing or delivering or purporting to execute or deliver any such document,
      security or endorsement.

     

    8. Notices,
      instructions or other communications shall be in writing and shall be given
      to
      the address set forth in the “Addresses” provision herein (or to such other
      address as may be substituted therefor by written notification to Escrow Agent,
      the Company or the Underwriter). Notices to Escrow Agent shall be deemed to
      be
      given when actually received by Escrow Agent’s Corporate Trust Department.
      Escrow Agent is authorized to comply with and rely upon any notices,
      instructions or other communications believed by it to have been sent or given
      by the Company or Underwriter or by a person or persons authorized by the
      Company or Underwriter. Whenever under the terms hereof the time for giving
      a
      notice or performing an act falls upon a Saturday, Sunday, or banking holiday,
      such time shall be extended to the next day on which Escrow Agent is open for
      business.

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

    

     

    9. The
      Company shall be liable for and shall reimburse and indemnify Escrow Agent
      and
      hold Escrow Agent harmless from and against any and all claims, losses,
      liabilities, costs, damages or expenses (including reasonable attorneys’ fees
      and expenses) (collectively, “Losses”) arising from or in connection with or
      related to this Escrow Agreement or being Escrow Agent hereunder (including
      but
      not limited to Losses incurred by Escrow Agent in connection with its successful
      defense, in whole or in part, of any claim of gross negligence or willful
      misconduct on its part), provided, however, that nothing contained herein shall
      require Escrow Agent to be indemnified for Losses caused by its gross negligence
      or willful misconduct.

     

    10. The
      Proceeds will not be subject to claims by: (i) creditors of the Company; (ii)
      a
      person who, directly or indirectly, controls, is controlled by, or is under
      common control with the person specified herein, hereinafter referred to as
      an
“Affiliate”; (iii) “Associates” as defined by the North American Securities
      Administrators Association, Inc. (“NASAA”) Statement of Policy Regarding
      Corporate Securities Definitions; or (iv) Underwriters until the Proceeds have
      been released to the Company pursuant to the terms of the
      Agreement.

     

    11. The
      State
      of Indiana Securities Division shall have the right to inspect and make copies
      of the records of the Escrow Agent at any reasonable time wherever the records
      are located. 

     

    12. (a) The
      Company and Underwriter may remove Escrow Agent at any time by giving to Escrow
      Agent thirty (30) calendar days’ prior notice in writing signed by the Company
      and Underwriter. Escrow Agent may resign at any time by giving to the Company
      and Underwriter fifteen (15) calendar days’ prior written notice
      thereof.

     

    (b) Within
      ten (10) calendar days after giving the foregoing notice of removal to Escrow
      Agent or receiving the foregoing notice of resignation from Escrow Agent, the
      Company and Underwriter shall jointly agree on and appoint a successor Escrow
      Agent. If a successor Escrow Agent has not accepted such appointment by the
      end
      of such 10-day period, Escrow Agent may, in its sole discretion, deliver the
      Escrow Property to the Company and Underwriter at the address provided herein
      or
      may apply to a court of competent jurisdiction for the appointment of a
      successor Escrow Agent or for other appropriate relief. The costs and expenses
      (including reasonable attorneys’ fees and expenses) incurred by Escrow Agent in
      connection with such proceeding shall be paid by the Company.

     

    (c) Upon
      receipt of the identity of the successor Escrow Agent, Escrow Agent shall either
      deliver the Escrow Property then held hereunder to the successor Escrow Agent,
      less Escrow Agent’s fees, costs and expenses or other obligations owed to Escrow
      Agent, or hold such Escrow Property (or any portion thereof), pending
      distribution, until all such fees, costs and expenses or other obligations
      are
      paid.

     

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

    

     

    (d) Upon
      delivery of the Escrow Property to successor Escrow Agent, Escrow Agent shall
      have no further duties, responsibilities or obligations hereunder.

     

    13. (a) In
      the
      event of any ambiguity or uncertainty hereunder or in any notice, instruction
      or
      other communication received by Escrow Agent hereunder, Escrow Agent may, in
      its
      sole discretion, refrain from taking any action other than retain possession
      of
      the Escrow Property, unless Escrow Agent receives written instructions, signed
      by the Company and Underwriter, which eliminates such ambiguity or
      uncertainty.

     

    (b) In
      the
      event of any dispute between or conflicting claims by or among the Company
      and
      the Underwriter and/or any other person or entity with respect to any Escrow
      Property, Escrow Agent shall be entitled, in its sole discretion, to refuse
      to
      comply with any and all claims, demands or instructions with respect to such
      Escrow Property so long as such dispute or conflict shall continue, and Escrow
      Agent shall not be or become liable in any way to the Company and/or Underwriter
      for failure or refusal to comply with such conflicting claims, demands or
      instructions. Escrow Agent shall be entitled to refuse to act until, in its
      sole
      discretion, either (i) such conflicting or adverse claims or demands shall
      have
      been determined by a final order, judgment or decree of a court of competent
      jurisdiction, which order, judgment or decree is not subject to appeal, or
      settled by agreement between the conflicting parties as evidenced in a writing
      satisfactory to Escrow Agent or (ii) Escrow Agent shall have received security
      or an indemnity satisfactory to it sufficient to hold it harmless from and
      against any and all Losses which it may incur by reason of so acting. Escrow
      Agent may, in addition, elect, in its sole discretion, to commence an
      interpleader action or seek other judicial relief or orders as it may deem,
      in
      its sole discretion, necessary. The costs and expenses (including reasonable
      attorneys’ fees and expenses) incurred in connection with such proceeding shall
      be paid by the Company.

     

    14. This
      Agreement shall be interpreted, construed, enforced and administered in
      accordance with the internal substantive laws (and not the choice of law rules)
      of the State of Indiana. Each of the Company and the Underwriter hereby submits
      to the personal jurisdiction of and each agrees that all proceedings relating
      hereto shall be brought in courts located within the City and State of Indiana
      or elsewhere as Escrow Agent may select. Each of the Company and the Underwriter
      hereby waives the right to trial by jury and to assert counterclaims in any
      such
      proceedings. To the extent that in any jurisdiction the Company or the
      Underwriter may be entitled to claim, for itself or its assets, immunity from
      suit, execution, attachment (whether before or after judgment) or other legal
      process, each hereby irrevocably agrees not to claim, and hereby waives, such
      immunity. Each of the Company and the Underwriter waives personal service of
      process and consents to service of process by certified or registered mail,
      return receipt requested, directed to it at the address last specified for
      notices hereunder, and such service shall be deemed completed ten (10) calendar
      days after the same is so mailed.

     

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

    

     

    15. Except
      as
      otherwise permitted herein, this Escrow Agreement may be modified only by a
      written amendment signed by all the parties hereto, and no waiver of any
      provision hereof shall be effective unless expressed in a writing signed by
      the
      party to be charged.

     

    16. The
      rights and remedies conferred upon the parties hereto shall be cumulative,
      and
      the exercise or waiver of any such right or remedy shall not preclude or inhibit
      the exercise of any additional rights or remedies. The waiver of any right
      or
      remedy hereunder shall not preclude the subsequent exercise of such right or
      remedy.

     

    17. Each
      of
      the Company and the Underwriter hereby represent and warrant (a) that this
      Escrow Agreement has been duly authorized, executed and delivered on its behalf
      and constitutes its legal, valid and binding obligation and (b) that the
      execution, delivery and performance of this Escrow Agreement by the Company
      and
      the Underwriter does not and will not violate any applicable law or
      regulation.

     

    18. The
      invalidity, illegality or unenforceability of any provision of this Agreement
      shall in no way affect the validity, legality or enforceability of any other
      provision; and if any provision is held to be enforceable as a matter of law,
      the other provisions shall not be affected thereby and shall remain in full
      force and effect.

     

    19. This
      Agreement shall constitute the entire agreement of the parties with respect
      to
      the subject matter and supersedes all prior oral or written agreements in regard
      thereto.

     

    20. This
      Agreement shall terminate upon the distribution of all Escrow Property from
      the
      Account. The provisions of these Terms and Conditions shall survive termination
      of this Escrow Agreement and/or the resignation or removal of the Escrow
      Agent.

     

    21. No
      printed or other material in any language, including prospectuses, notices,
      reports, and promotional material which mentions “Tower Trust Company” by name
      or the rights, powers, or duties of the Escrow Agent under this Agreement shall
      be issued by any other parties hereto, or on such party’s behalf, without the
      prior written consent of Escrow Agent.

     

    22. The
      headings contained in this Agreement are for convenience of reference only
      and
      shall have no effect on the interpretation or operation hereof.

     

    23. This
      Escrow Agreement may be executed by each of the parties hereto in any number
      of
      counterparts, each of which counterpart, when so executed and delivered, shall
      be deemed to be an original and all such counterparts shall together constitute
      one and the same agreement.

     

    
      
         

      

      
        -10-

        
          

        

      

      
         

      

    

    

     

    24. The
      Escrow Agent does not have any interest in the Escrowed Property Deposited
      hereunder but is serving as escrow holder only and having only possession
      thereof. The Company shall pay or reimburse the Escrow Agent upon request for
      any transfer taxes or other taxes relating to the Escrowed Property incurred
      in
      connection herewith and shall indemnify and hold harmless the Escrow Agent
      any
      amounts that it is obligated to pay in the way of such taxes. Any payments
      of
      income from this Escrow Account shall be subject to withholding regulations
      then
      in force with respect to United States taxes. The parties hereto will provide
      the Escrow Agent with appropriate W-9 forms for tax I.D., number certifications,
      or W-8 forms for non-resident alien certifications. 

     

    25. Tax
      Reporting. 

     

    (a) In
      the
      event the Minimum Offering Amount is reached the taxable income will be reported
      to the Company.

     

    (b) In
      the
      event the Minimum Offering Amount is not reached the taxable income will be
      reported to each investor who received a refund on their investment. The
      Underwriter shall forward to the Escrow Agent the W-9 of each investor. Further,
      the Underwriter shall provide the Escrow Agent, within two (2) business days,
      with written instruction as to how to distribute the funds to be returned to
      investors, including amount to be returned to each investor and amount to be
      reported as taxable income by the Escrow Agent. The Company shall pay the Escrow
      Agent a fee of $1,200 in connection with federal and or state tax reporting
      on
      Form 1099- INT for interest to be returned to investors. 

     

    (c) It
      is
      understood that the Escrow Agent shall be responsible for income reporting
      only
      with respect to income earned on investment of funds which are a part of the
      Escrowed Property and is not responsible for any other reporting. 

     

    26. The
      Company and the Underwriter each shall provide the Escrow Agent with a corporate
      resolution identifying the individual(s) who is(are) authorized to sign the
      Agreement and represent the Company and the Underwriter in all dealings with
      the
      Escrow Agent. 

     

    

     

    

     

    [Remainder
      of this page intentionally left blank.]

     

    
      
         

      

      
        -11-

        
          

        

      

      
         

      

    

    

     

    27. The
      provisions of paragraphs I.6, II.9 and II.24 shall survive the termination
      of
      this Escrow Agreement or the resignation or removal of the Escrow
      Agent.

     

    IN
      WITNESS WHEREOF, each of the parties have caused this Escrow Agreement to be
      executed by a duly authorized officer as of the day and year first written
      above.

     

    
      	 	 
	
              FREEDOM
                FINANCIAL HOLDINGS, INC.

            	
              ALARON
                FINANCIAL SERVICES, INC.

            
	 	 
	 	 
	
              
                By:________/s/________________

              

            	
              
                By:___________/s/_________________

              

            
	
              Name:
                Brian Kistler

            	
              Name:
                David Bonifield

            
	
              Title:
                Chief Executive Officer

            	
              Title:
                President

            
	 	 
	 	 
	 	 
	 	 
	
               

            	TOWER
              TRUST COMPANY,
	
               

            	
              as
                Escrow Agent

            
	 	 
	 	 
	 	
              _________/s/_______________

            
	 	
              Name:
                Sharon J. Peters

            
	 	
              Title:
                Vice President and Trust Officer

            

    

    

    
      
         

      

      
        -12-

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