Document:

Blueprint

  

 Exhibit 10.4

 

After Recording Return To:

 

LAZARUS ENERGY HOLDINGS, LLC

801 Travis, Suite 2100

Houston, Texas 77002

Attn: Jonathan Carroll

 

 

NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS:
YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER’S LICENSE NUMBER.

 

 

COLLATERAL ASSIGNMENT

 

THIS COLLATERAL ASSIGNMENT (as amended, modified or restated from time to time, this “Assignment”) dated as of AUGUST 15, 2016 (the “Effective Date”), is executed by BLUE
DOLPHIN PIPE LINE COMPANY, a Delaware corporation (“Grantor”), with offices at 801 Travis Street, Suite 2100, Houston, TX 77002, for the benefit of LAZARUS ENERGY HOLDINGS, LLC (together with its successors and assigns, “Lender”) with offices at 801 Travis, Suite 2100 Houston, Texas 77002.

 

RECITALS

 

WHEREAS, Lender and BLUE DOLPHIN PIPE LINE COMPANY, a Delaware corporation (referred to herein as “Grantor” and “Debtor”, interchangeably), have entered into a LOAN
AND SECURITY AGREEMENT dated as of the Effective Date (as amended, modified or restated from time to time, the “Loan Agreement”; capitalized terms not defined herein shall have the same meanings as in the Loan Agreement).

WHEREAS, Grantor is also the Grantor under that certain EASEMENT AGREEMENT dated as of December 11, 2013 by and between BLUE DOLPHIN PIPE LINE COMPANY, a Delaware corporation and FLNG Land II, Inc. (also referred to
herein collectively as “Counterparties” and individually as “Counterparty. (A true, correct and complete copy of said Easement Agreement is attached hereto as Exhibit A, as amended, the “Easement Agreement”).

 

WHEREAS, Grantor’s execution of this Agreement is a condition precedent to Lender’s agreement to execute the Loan Agreement.

NOW, THEREFORE, in consideration of the premises herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Grantor hereby agrees in favor of Lender as follows:

1. Assignment. As security for the repayment of the Indebtedness, Grantor hereby transfers, pledges, and assigns to Lender, its successors and assigns, and grants Lender a security
interest in all right, title and interest of Grantor in and to the Easement Agreement, including, without limitation, all disbursement rights, reimbursement payments, payment rights, and all other rights to payment under the Easement Agreement (collectively, the “Payment Rights”). This Assignment shall constitute a security agreement within the meaning of the Code. Grantor hereby irrevocably instructs the Counterparty to make any and all payments owing
to Grantor with respect to the Payment Rights directly to Lender.

 

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2. Representations and Warranties. Grantor hereby represents and warrants to Lender that:

(a) A true, correct and complete copy of the Easement Agreement has been attached to this Assignment as Exhibit A (together with all assignments, amendments, modifications or understandings relating
thereto). The Easement Agreement is in full force and effect.

(b) Grantor has not executed any prior assignment, pledge or hypothecation of its rights under the Easement Agreement or the Payment Rights. Lender has a first priority lien in the Easement Agreement and the Payment Rights. Grantor will defend
at its expense Lender’s right, title and security interest in and to the Easement Agreement and the Payment Rights against the claims of any third party.

(c) The execution, delivery, and performance of this Assignment by Grantor has been duly authorized by all necessary action by Grantor, and this Assignment constitutes a legal, valid and binding obligation of Grantor, enforceable in accordance
with its terms, except as limited by bankruptcy, insolvency or similar laws of general application relating to the enforcement of creditors’ rights and except to the extent specific remedies may generally be limited by equitable principles.

(d) Grantor’s execution, delivery and performance of this Assignment and the consummation of the transactions contemplated thereby by Grantor, do not (i) conflict with, result in a violation of, or constitute a default under (1)
any provision of its organizational documents or other instrument binding upon Grantor, (2) any law, governmental regulation, court decree or order applicable to Grantor, or (3) any contractual obligation, agreement, judgment, license, order or permit applicable to or binding upon Grantor, (ii) require the consent, approval or authorization of any third party which consent or approval has not been obtained, or (iii) result in or require the creation of any lien, charge or encumbrance upon any property or assets
of Grantor except as may be expressly contemplated by this Assignment.

(e) Grantor has no actual knowledge that the Counterparty has asserted any default or non-performance by Grantor of Grantor’s duties and obligations under the Easement Agreement, Grantor has performed all of Grantor’s duties and
obligations which are now due and performable under the Easement Agreement, and no defense or counter-claim exists with respect to the duties and obligations of the Counterparty under the Easement Agreement.

3. Covenants and Agreements. Grantor hereby covenants in favor of Lender as follows:

(a) Grantor will perform all of its duties and obligations under the Easement Agreement in accordance with the terms thereof. Grantor shall not amend, alter or modify the Easement Agreement without the express prior written consent of Lender.

(b) Grantor shall promptly notify Lender of any default by Grantor or the Counterparty in the performance of their respective duties and obligations under the Easement Agreement and shall immediately remedy any default by Grantor thereunder.

(c) Grantor shall execute such further and additional instruments and assignments as may be requested by Lender to vest in Lender a valid security interest in and to all rights, title and interest of Grantor in and to the Easement Agreement
and the Payment Rights.

(d) Grantor will not take any action that would in any manner impair the enforceability of Lender’s security interest in the Easement Agreement or the Payment Rights. Grantor (i) will, if requested by Lender, strictly enforce the terms
and conditions of the Easement Agreement, and (ii) shall not grant any waiver or indulgence with respect the Easement Agreement.

4. Lender as Agent. Grantor hereby agrees as follows:

(a) Upon the occurrence and during the continuation of an Event of Default (which includes a default under the Easement Agreement), Lender shall be irrevocably appointed agent and attorney-in-fact as to performance by Grantor of its obligations
under the Easement Agreement, and as to the enforcement of Grantor’s rights and remedies under the Easement Agreement;

  

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(b) All reasonable costs, expenses and liabilities incurred and payments made by Lender as agent and attorney-in-fact shall be considered a loan by Lender to Grantor which shall be repayable on demand and which shall bear interest at the Maturity
Rate (as defined in the Note referred to in the Loan Agreement);

(c) Regarding the existence of any Event of Default for purposes of this Assignment, Grantor agrees that the Counterparty may rely upon written certifications from Lender that such an Event of Default exists; and

(d) Notwithstanding the foregoing, Lender shall have no obligation whatsoever to perform any of Grantor’s obligations under the Easement Agreement.

5. Foreclosure. This Assignment is executed as additional security for the payment of the Indebtedness and all other indebtedness owing or to become owing by Grantor to Lender,
and it is expressly stipulated, covenanted and agreed that an Event of Default by Grantor under the terms of the Loan Agreement shall constitute a default under the terms of this Assignment and that foreclosure under this Assignment shall operate to foreclose fully the rights of Grantor arising from the Easement Agreement, and in such event, all rights of Grantor under the Easement Agreement shall be vested in the successful bidder at such foreclosure. In addition, Lender shall have all other rights and remedies
of a secured party under the Code.

6. Grantor Remains Liable. Notwithstanding anything to the contrary contained herein, (a) Grantor shall remain liable under the Easement Agreement to the extent set forth therein
to perform all of Grantor’s duties and obligations thereunder to the same extent as if this Assignment had not been executed; (b) the exercise by Lender of any of its rights hereunder shall not release Grantor from any of its duties or obligations under the Easement Agreement; and (c) Lender shall not have any obligation or liability under the Easement Agreement by reason of this Assignment, nor shall Lender be obligated to perform any of the obligations or duties of Grantor thereunder or to take any action
to collect or enforce any claim for payment assigned hereunder.

7. Receipt of Payments. All payments with respect to the Payment Rights and other amounts and proceeds received by Grantor in respect of the Easement Agreement shall be received
in trust for the benefit of Lender and shall be paid to Lender as provided under the Loan Documents.

8. General. Grantor hereby further agrees as follows:

(a) No remedy or right conferred upon Lender by operation of law, by this Assignment, Loan Agreement or by any other instrument executed by Grantor in connection therewith is intended to be, nor shall it be, exclusive of any other right or
remedy, but each and every remedy or right shall be cumulative and shall be in addition to every other remedy or right conferred upon Grantor and each and every such remedy or right may be pursued by Lender in such manner or order, together or separately, and at such times as Lender may elect.

(b) If any term or provision of this Assignment, or the application thereof to any person or circumstance shall, to any extent be invalid or unenforceable, the remainder of this Assignment, or the application of such term or provision to persons
or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Assignment shall be valid and be enforced to the fullest extent permitted by law.

(c) Notice provided for in this Assignment must be in writing, and shall be given or served in the same manner as specified in the Loan Agreement.

9. Invalid Provisions. If any provision of this Assignment are held to be illegal, invalid or unenforceable under present or future laws, such provision shall be fully severable
and the remaining provisions of this Assignment shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance.

  

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10. Counterparts. This Assignment may be separately executed in any number of counterparts, each of which shall be an original, but all of which, taken together, shall be deemed
to constit

ute one and the same instrument.

11. Survival. All representations and warranties made in this Assignment or in any document, statement, or certificate furnished in connection with this Assignment shall survive the execution and delivery
this Assignment and no investigation by Lender or any closing shall affect the representations and warranties or the right of Lender to rely upon them.

 

 

 

NOTICE OF FINAL AGREEMENT:

 

THIS ASSIGNMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES, AND THE SAME MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

 

 

REMAINDER OF PAGE LEFT INTENTIONALLY BLANK

  

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EXECUTED as of the date of the acknowledgment below, but to be effective as of the Effective Date.

	
GRANTOR:
	
 
	
 

	
 
	
 
	
 

	
BLUE DOLPHIN PIPE LINE COMPANY
	
 
	
 

	
 
	
 
	
 

	
By: BLUE DOLPHIN ENERGY COMPANY
	
 
	
  

	
Its: Sole Shareholder
	
 
	
  

	
 
	
 
	
  

	
By:/s/ TOMMY L. BYRD
	
 
	
  

	
Name: Tommy L. Byrd
	
 
	
  

	
Title: CFO
	
 
	
  

 

  

STATE OF TEXAS                                                                 §

COUNTY OF DALLAS                                                        
§

This instrument was acknowledged before me on August 12th, 2016, by Tommy L. Byrd., CFO of BLUE DOLPHIN ENERGY COMPANY, a Delaware corporation, and Sole Shareholder of BLUE DOLPHIN PIPE LINE COMPANY, a Delaware corporation, on behalf of said entities.

[SEAL]                                                      /
s / JENNIFER M. HARVEY

                                                                   Notary Public, State of Texas

 

 

 

 

  

5

 

 

EXHIBIT A

EASEMENT AGREEMENT

 

See Attached.

 

 

  

6HCSB FINANCIAL CORPORATION

2016 EQUITY INCENTIVE PLAN

 

Restricted
Stock Award Grant Notice

 

	Participant Name:   	[•]
	 	 
	Company: 	HCSB Financial Corporation
	 	 
	Notice: 	A summary of the terms of your grant of Restricted Shares is set out in this notice (the “Grant Notice”) but subject always to the terms of the HCSB Financial Corporation 2016 Equity Incentive Plan (the “Plan”) and the Restricted Stock Award Agreement (the “Award Agreement”).  In the event of any inconsistency between the terms of this Grant Notice, the terms of the Plan and the Award Agreement, the terms of the Plan and the Award Agreement shall prevail.
	 	 
	Type of Award: 	Restricted Stock Award
	 	 
	Stock:	Shares of voting common stock, par value $0.01 per share, of the Company 
	 	 
	Number of Shares	 
	of Stock Subject	 
	to Grant: 	[•]
	 	 
	Grant Date:	[•], 2016
	 	 
	Vesting Schedule:  	Restricted Shares granted will vest (i.e., restrictions shall lapse) upon the later of (i) the lapse of the Time Vesting Conditions set forth below, and (ii) the Company’s achievement of both of the Performance Vesting Conditions set forth below, such date being the vesting date, in each case provided that you have provided continuous employment to the Company or any Participating Employer through each such vesting date:
	 	 
	 	Time Vesting Conditions

 

	 	Time Vesting Date	No. of Shares
	 	August 18, 2017	[20%]
	 	August 18, 2018	[20%]
	 	August 18, 2019	[20%]
	 	August 18, 2020	[20%]
	 	August 18, 2021	[20%]

 

	 	Performance Vesting Conditions
	 	 
	 	No Restricted Shares shall vest on the Time Vesting Dates set forth above unless the Company has achieved both of the Performance Vesting Conditions set forth below:

 

    	 

     

    

 

	 	A.	The Company must have reported net income (after income taxes) for two consecutive quarters prior to the applicable Time Vesting Date, as such net income (or net loss) is reported in the Company’s Consolidated Statements of Income (Loss) in the Company’s Quarterly Reports on Form 10-Q for the periods ending March 31, June 30, and September 30 and the Company’s Annual Reports on Form 10-K for the periods ending December 31, as filed with the Securities and Exchange Commission.  If the Company has not reported net income (after income taxes) for two consecutive quarters prior to the applicable Time Vesting Date, then the Restricted Shares for such Time Vesting Date shall be eligible for vesting upon the Company’s reporting of two consecutive quarters of net income prior to August 18, 2021.  If the Company has not reported two consecutive quarters of net income prior to August 18, 2021, then any unvested Restricted Shares shall be forfeited. 
	 	 	 
	 	B.	If the Order (issued to the Company’s wholly owned subsidiary, Horry County State Bank, by the Bank’s Supervisory Authorities effective February 10, 2011) has not been removed by the Supervisory Authorities prior to the applicable Vesting Date, then the number of Restricted Shares that shall vest on such Vesting Date shall be reduced to 50% of the Restricted Shares set forth on the schedule above for such Vesting Date, subject to (A) above.  Once the Order has been removed by the Supervisory Authorities, all Restricted Shares that would have otherwise vested shall vest equally over the remaining Vesting Dates listed on the Time Vesting Schedule above.  For the avoidance of doubt and by way of illustration, if the Order is removed by the Supervisory Authorities on September 30, 2017, then in addition to the [10%] shares of Restricted Stock previously vested on August 18, 2017, [22.5%] Restricted Shares (in each case, including [2.5%] Restricted Shares representing one-fourth of the Restricted Shares that were not previously vested on August 18, 2017 due to the Order being effective) will vest on each of August 18, 2018, August 18, 2019, August 18, 2020, and August 18, 2021.  If the Order is not removed by the Supervisory Authorities prior to August 18, 2021, then any unvested Restricted Shares shall be forfeited.   For the purposes of this paragraph, Supervisory Authorities shall refer to the Federal Deposit Insurance Corporation and the South Carolina Board of Financial Institutions.

 

    	 	2	 

     

    

 

	 	In the event of a Change of Control, all unvested Restricted Shares will automatically vest in full immediately prior to the consummation of the Change of Control.
	 	 
	Acceptance:   	You acknowledge receipt of, and understand and agree to, this Grant Notice, the Award Agreement and the Plan. You further acknowledge that as of the Grant Date, this Grant Notice, the Award Agreement and the Plan set forth the entire understanding between you and the Company or any Participating Employer regarding the Restricted Shares and supersede all prior oral and written Award Agreements on the subject.

 

[Signatures appear on the following
page.]

 

    	 	3	 

     

    

IN WITNESS WHEREOF, the Company
and the Participant have duly executed and delivered this Grant Notice as of the Grant Date.

 

 

	HCSB FINANCIAL CORPORATION	 	PARTICIPANT
	 	 	 
	By: 	 	 
	Name:	 	Name: 
	Title: 	 	 
	 	 	Address: 

 

 

Attachments:

 

		1.	Restricted Stock Award Agreement
	 	 	 
		2.	2016 Equity Incentive Plan

    	 	4	 

     

    

HCSB
FINANCIAL CORPORATION

 

Restricted Stock Award Agreement

 

Pursuant to the
Restricted Stock Grant Notice (the “Grant Notice”) and this Restricted Stock Award Agreement (this “Award
Agreement”), HCSB Financial Corporation (the “Company”) has granted the Participant, as identified
in the Grant Notice, the number of restricted shares of the Company’s Common Stock under the Company’s 2016 Equity
Incentive Plan (the “Plan”) indicated in the Grant Notice (the “Restricted Shares”). Capitalized
terms not defined in this Award Agreement but defined in the Plan or the Grant Notice will have the same definitions as in the
Plan or the Grant Notice, respectively.

 

1.                 
Restrictions and Vesting Schedule. The Restricted Shares are being awarded to Participant
subject to the transfer and forfeiture conditions set forth in this Award Agreement and the Plan (the “Restrictions”).
Subject to the provisions of Section 2 below, the Restricted Shares will vest, and Restrictions shall lapse, as provided in the
Participant’s Grant Notice. The period from the Date of Grant through the last Vesting Date set forth in the Grant Notice
is referred to as the “Restriction Period.” Except to the extent vesting accelerates pursuant to the terms of
the Grant Notice or Section 2 below, any unvested Restricted Shares shall be automatically forfeited upon Participant’s Termination
from Service.

 

2.                 
Acceleration of Vesting upon a Change in Control. In the event of a Change of Control,
all unvested Restricted Shares will automatically vest in full immediately prior to the consummation of the Change of Control.

 

3.                 
Assignment or Transfer of Shares. Unless otherwise provided by the Board, prior to
the vesting of the Restricted Shares, Participant may not directly or indirectly, by operation of law or otherwise, voluntarily
or involuntarily, sell, assign, pledge, encumber, charge or otherwise transfer any of the Restricted Shares still subject to Restrictions.
The Restricted Shares shall be forfeited if Participant violates or attempts to violate these transfer Restrictions. After any
Stock has been released from the Restrictions, Participant shall not directly or indirectly, by operation of law or otherwise,
voluntarily or involuntarily, sell, assign, pledge, encumber, charge or otherwise transfer any interest in the Stock except in
compliance with the provisions herein and the provisions of applicable securities laws.

 

4.                 
Delivery of Shares. The Company shall enter such Award of Restricted Stock in book
entry form with appropriate restrictions noted with respect thereto.

 

5.                 
Rights of Participant. Subject to the provisions of this Award Agreement, Participant
shall exercise all rights and privileges of a shareholder of the Company with respect to the Restricted Shares deposited pursuant
to Section 4. Participant shall be deemed to be the holder for purposes of receiving any dividends that may be paid with respect
to such shares of Stock and for the purpose of exercising any voting rights relating to such shares of Stock, even if some or all
of such shares of Stock have not yet vested and been released from the Restrictions.

 

6.                 
Restrictive Legends. The Company’s book entry notations representing the Stock
shall have been noted with a legend in substantially the following form:

 

“THE SHARES
REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS SET FORTH IN A RESTRICTED STOCK AWARD AGREEMENT BETWEEN THE COMPANY
AND THE REGISTERED HOLDER, OR SUCH HOLDER’S PREDECESSOR IN INTEREST, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF
THE COMPANY. ANY TRANSFER OR ATTEMPTED TRANSFER OF ANY SHARES SUBJECT TO SUCH RESTRICTED STOCK AWARD IS VOID WITHOUT THE PRIOR
EXPRESS WRITTEN CONSENT OF THE COMPANY.”

    	 	5	 

     

    

The Company shall
remove or cause the removal of the foregoing legend as and to the extent of the lapse of the applicable Restrictions.

 

7.                 
Section 83(b) Election. Participant understands that Section 83(a) of the Code taxes
as ordinary income the difference between the amounts paid for the Stock and the fair market value of the Stock as of the date
any Restrictions on the Stock lapse. Participant understands that Participant may elect to be taxed at the time the Restricted
Shares are granted rather than when and as the Restrictions lapse, by filing an election under Section 83(b) (“83(b) Election”)
of the Code with the Internal Revenue Service within 30 days from the Date of Grant. Even if the fair market value of the Restricted
Shares at the time of the Grant equals the amount paid for the Stock, if any, the 83(b) Election must be made to avoid income under
Section 83(a) in the future. Participant understands that failure to file such an 83(b) Election in a timely manner may result
in adverse tax consequences for Participant. Participant further understands that an additional copy of such 83(b) Election is
required to be filed with his or her federal income tax return for the calendar year in which the Grant Date in connection with
this Award Agreement falls. Participant further acknowledges and understands that it is Participant’s decision as to whether
to file such 83(b) Election, and neither the Company nor the Company’s legal or financial advisors shall have any obligation
or responsibility with respect to such filing. Participant acknowledges that the foregoing is only a summary of the effect
of United States federal income taxation with respect to purchase of the Stock hereunder, and does not purport to be complete.
Participant further acknowledges that the Company has directed Participant to seek independent advice regarding the applicable
provisions of the Code, the income tax laws of any municipality, state or foreign country in which Participant may reside, and
the tax consequences of Participant’s death. Participant assumes all responsibility for filing an 83(b) Election and paying
all taxes resulting from such election or the lapse of the Restrictions on the Stock.

 

8.                 
Refusal to Transfer. The Company shall not be required to transfer on its books any
shares of Stock of the Company which shall have been transferred in violation of any of the provisions set forth in this Award
Agreement.

 

9.                 
No Employment Rights. This Award Agreement is not an employment contract and nothing
in this Award Agreement shall confer upon the Participant any right to continued employment with or service to the Company or any
Subsidiary, as the case may be, nor shall it interfere in any way with the right of the Company or any Subsidiary to terminate
the employment or service of the Participant at any time.

 

10.             
Governing Plan Document. The Restricted Shares granted hereunder are subject to all
the provisions of the Plan, the provisions of which are hereby incorporated by reference herein, and is further subject to all
interpretations, amendments, rules and regulations which may from time to time be promulgated and adopted pursuant to the Plan.
Capitalized terms used herein and not defined shall have the meanings assigned in the Plan. In the event of any conflict between
the provisions of this Award Agreement and those of the Plan, the provisions of the Plan shall control.

 

11.             
Adjustments. The Restricted Shares shall be subject to adjustments as provided in Sections
4, 9, 10, 11 and 14 of the Plan.

 

    	 	6	 

     

    

12.             
Acknowledgements. No waiver of any breach of any provision of this Award Agreement
by the Company shall be construed to be a waiver of any succeeding breach or as a modification of such provision.

 

13.             
Miscellaneous.

 

(a)              
Notices. All notices required or permitted hereunder shall be in writing and shall be deemed
effectively given: (a) when personally delivered to the party to be notified; (b) when sent by confirmed facsimile to the
party to be notified; (c) five business days after deposit in the United States Mail postage prepared by certified or registered
mail with return receipt requested at any time other than during a general discontinuance of postal service due to strike, lockout,
or otherwise (in which case notice, request, waiver or other communication shall be effectively given upon receipt) and address
to the party to be notified as set forth above; or (d) two business days after deposit with a national recognized overnight
delivery service, postage prepaid, addressed to the party to be notified as set forth above with next-business-day delivery guaranteed.
A party may change its notice address by giving the other party ten days’ written of the new address in the manner set forth
above.

 

(b)              
Successors and Assigns.  This Award Agreement shall inure to the benefit of the successors
and assigns of the Company and, subject to the restrictions on transfer herein set forth, be binding upon Participant, Participant’s
successors, and assigns.

 

(c)              
Governing Law. This Award Agreement shall be governed by and construed in accordance with
the laws of the State of South Carolina, without reference to principles of conflict of laws.

 

(d)              
Entire Award Agreement; Amendment. This Award Agreement, along with the Grant Notice and the
Plan constitute the entire Award Agreement between the parties with respect to the subject matter hereof and supersedes and merges
all prior agreements or understandings, whether written or oral. This Award Agreement may only be amended as described in Section
11 of the Plan.

 

    	 	7	 

     

    

ATTACHMENT A

ELECTION UNDER SECTION 83(B)

OF THE INTERNAL REVENUE CODE OF 1986

 

The undersigned taxpayer
hereby elects, pursuant to §83(b) of the Internal Revenue Code, to include in taxpayer’s gross income or alternative
minimum tax income, as applicable, for the current taxable year, the amount of any income that may be taxable to taxpayer in connection
with taxpayer’s receipt of the property described below:

 

	1.	The taxpayer’s name, address and taxpayer identification number are as follows:
	 	 
	 	Name:
	 	Address:
	 	 
	 	SS# 
	 	 
	2.	Description of property with respect to which the election is being made:
	 	 
	 	_________ shares of Common Stock of HCSB Financial Corporation, a South Carolina corporation (the “Company”), granted pursuant to a Restricted Stock Award under the Company’s Equity Incentive Plan. 
	 	 
	3.	The date on which the property was transferred is.
	 	 
	 	The taxable year for which the election is made is calendar year          . 
	 	 
	4.	The property is subject to the following restrictions:
	 	 
	 	The Restricted Shares are subject to a vesting schedule pursuant to which restrictions on transfer will lapse.
	 	 
	5.	The fair market value at time of transfer (determined without regard to any restriction other than a restriction which by its terms will never lapse) of such property is $_________.
	 	 
	6.	Furnishing statement to employer:
	 	 
	 	A copy of this statement has been furnished to the Company.

 

 

	Dated: 	 
	 	Taxpayer:  

 

    	 	8

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