Document:

Exhibit 4.3

 

COASTAL
CAROLINA BANCSHARES, INC.

 

ORGANIZER/FOUNDER
WARRANT AGREEMENT

 

                    ,
2008

 

	
  Warrant Holder:                                 

  	
   

  	
  No. of Shares:                                 

  

 

Coastal Carolina Bancshares, Inc. (the “Company”),
a South Carolina corporation and the holding company for Coastal Carolina
National Bank (the “Bank”), hereby grants to the person identified above
(the “Warrant Holder”) warrants (the “Warrants”) to purchase the
number of shares (the “Shares”) of common stock of the Company (the “Common
Stock”) set forth above, in recognition of the financial risk undertaken by
the Warrant Holder in organizing the Bank and the Company. Such Warrants are
granted on the following terms and conditions:

 

1. Exercise of Warrants.
The Warrant Holder may exercise the Warrants from time to time and receive the Shares
subject to the Warrants, subject to the following:

 

(a) Exercise
Price. The exercise price (the “Exercise Price”) shall be
$10.00 per Share, subject to adjustment pursuant to Section 2 below.

 

(b) Expiration
of Warrant Term. The Warrants will expire at 5:00 p.m. Eastern
Time on the tenth anniversary of the opening date of the Bank (subject to
earlier termination in certain circumstances pursuant to Section 2 or 5
below), and may not be exercised thereafter (the “Expiration Date”).

 

(c) Payment.
The purchase price for Shares as to which the Warrants are being exercised
shall be paid in cash, by wire transfer, by certified or bank cashier’s check
or by personal check drawn on funds on deposit with the Bank.

 

(d) Method
of Exercise. The Warrants shall be exercisable by a written notice
delivered to the President or Secretary of the Company which shall:

 

(1) State the Warrant Holder’s election to exercise the Warrants,
the number of Shares with respect to which it is being exercised, the person in
whose name the stock certificate for such Shares is to be registered, and such
person’s address and tax identification number (or, if more than one, the
names, addresses and tax identification numbers of such persons);

 

(2) Be signed by the person or persons entitled to exercise the
Warrants and, if the Warrants are being exercised by any person or persons
other than the original Warrant Holder, be accompanied by proof satisfactory to
counsel for the Company of the right of such person or persons to exercise the
Warrants; and

 

(3) Be accompanied by an executed copy of this Organizer/Founder
Warrant Agreement.

 

1

 

(e) Partial
Exercise. In the event of a partial exercise of the Warrants, the
Company shall either issue a new agreement for the balance of the Shares
subject to this Organizer/Founder Warrant Agreement after such partial
exercise, or it shall conspicuously note hereon the date and number of Shares
purchased pursuant to such exercise and the number of Shares remaining covered
by this Organizer/Founder Warrant Agreement.

 

(f) Restrictions
on Exercise. The Warrants may not be exercised (i) if the
issuance of Shares upon such exercise would constitute a violation of any
applicable federal or state securities or banking laws or other law or
regulation or (ii) unless the Company or the Warrant Holder, as
applicable, obtains any approval or other clearance which the Company determines
to be necessary or advisable from the Federal Reserve Board, the Federal
Deposit Insurance Corporation, the Comptroller of the Currency or any other
state or federal banking regulatory agency with regulatory authority over the
operation of the Company or the Bank (collectively the “Regulatory Agencies”).
The Company may require representations and warranties from the Warrant Holder
to comply with applicable laws or regulations, including the Securities Act of
1933, as amended (the “Act”), and state securities laws. In addition,
the Company shall not be obligated to deliver any Shares pursuant to the
exercise of the Warrants and shall have no obligation to settle such Warrants
exercise unless a registration statement under the Act with respect to the Shares
is effective and a prospectus complying in all material respects with the Act
(a “Prospectus”) is available for delivery by the Company. In the event
that a registration statement with respect to the Shares underlying such
Warrants is not effective under the Act or a Prospectus relating to the Shares
is not available for delivery by the Company, the Warrant Holder shall not be
entitled to exercise the Warrants and the Warrants may have no value and expire
worthless.

 

(g)  No Net Cash
Settlement.  In no event will
the Company be required to net cash settle the exercise of Warrants.

 

(h)  Minimum Exercise.  No less
than 100 shares of Common Stock may be purchased upon any one exercise of the Warrants
granted hereunder unless the number of shares purchased at such time is the
total remainder of shares subject to Warrants hereunder.

 

(i)  No Fractional Shares. 
A Warrant shall not be
exercisable for a fractional share; provided that, if a Warrant for a
fractional share results from an event described in Section 2 hereof,
then, upon exercise of such Warrant, the Warrant Holder shall receive the Fair
Market Value of such fractional share in cash. 
“Fair Market Value” on any date with respect to the Common
Stock shall mean:

 

(1)  if the Common Stock is listed on a
national securities exchange, the last reported sale price of a share of the
Common Stock on such exchange or, if no sale occurs on that date, the average
of the reported closing bid and asked prices on that date;

 

(2)  if the Common Stock is otherwise publicly
traded, the last reported sale price of a share of the Common Stock under the
quotation system under which the sale price is reported or, if no sale occurs
on that date, the average of 

 

2

 

the reported closing bid and asked prices on that date under the
quotation system under which the bid and asked prices are reported;

 

(3)  if no such last sales price or
average of the reported closing bid and asked prices are available on that
date, the last reported sale price of a share of the Common Stock, or if no
sale takes place, the average of the reported closing bid and asked prices as
so reported for the immediately preceding business day (i) on the national
securities exchange on which the Common Stock is listed or (ii) if the
Common Stock is otherwise publicly traded, under the quotation system under
which such data are reported, or

 

(4)  if none of the prices described
above is available, the value of a share of the Common Stock as reasonably
determined in good faith by the Board (as hereinafter defined) in a manner that
it believes to be in accordance with the Code.

 

2.  Anti-Dilution;
Business Combination; Dissolution.

 

(a)  Anti-Dilution;
Business Combination; Dissolution.  Subject to any action required by
the stockholders of the Company, the number of shares of Common Stock covered
by each outstanding Warrant and the per-share exercise price applicable to each
Warrant shall, in each case, be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a
subdivision or consolidation of shares or the payment of a stock dividend (but
only on the Common Stock) or any other increase or decrease in the number of
shares of Common Stock effected without receipt of consideration by the
Company.

 

Subject to any action required by the stockholders, in the event of a
Business Combination (as defined below) that is not a Change of Control
Business Combination (as defined below), each Warrant shall pertain to and apply
to the securities and other consideration that a holder of the number of Shares
of Common Stock underlying the Warrant would have been entitled to receive in
the Business Combination. In the event of (i) a Change of Control Business
Combination or (ii) the complete liquidation or dissolution of the
Company, then each outstanding Warrant shall terminate; provided however, that
the Warrant Holder shall, in such event, have the right immediately prior to
such Change of Control Business Combination or complete liquidation or
dissolution, to exercise the Warrants in whole or in part.

 

In the event of a change in the Common Stock as presently constituted,
which change is limited to a change of all of the authorized shares with par
value into the same number of shares with a different par value or without par
value, the shares resulting from any such change shall be deemed to be Shares
within the contemplation of this Organizer/Founder Warrant Agreement.

 

Except as expressly provided in this subsection 2(a), the Warrant
Holder shall have no rights by reason of (i) any subdivision or
consolidation of shares of any class of 

 

3

 

stock of the Company, (ii) any stock dividend, (iii) any
other increase or decrease in the number of shares of stock of any class, (iv) any
dissolution, liquidation, merger, consolidation, spin-off, split-off or split-up
of assets of the Company or stock of another corporation or (v) any
issuance by the Company of shares of stock of any class or securities
convertible into shares of stock of any class. Moreover, except as expressly
provided in this subsection 2(a), the occurrence of one or more of the above-listed
events or of any other similar event shall not affect, and no adjustment by
reason thereof shall be made with respect to, the number of, or the exercise
price relative to, the Shares underlying the Warrants.

 

The grant of the Warrants pursuant to this Organizer/Founder Warrant Agreement
shall not affect in any way the right or power of the Company to make
adjustments, reclassifications, reorganizations or changes to, of or in its
capital or business structure or to merge, consolidate, dissolve, liquidate,
sell or transfer all or any part of its business or assets.

 

(b)  Rights as a
Stockholder.  The Warrant
Holder shall have no rights as a stockholder with respect to any Shares
underlying the Warrants until the date of the issuance of Shares upon payment
of the exercise price. No adjustments shall be made for dividends (ordinary or
extraordinary, whether in cash, securities or other property) or distributions
or other rights for which the record date is prior to the date of such issuance,
except as provided in subsection 2(a).

 

(c)  Definitions.

 

(1)  “Business Combination” shall
mean consummation of a reorganization,
merger, consolidation, sale or other disposition of all or substantially all of
the assets of the Company or the Company’s acquisition of assets of another
corporation, partnership or limited liability company.

 

(2)  “Change
of Control Business
Combination” shall mean
consummation of a Business Combination, unless, following the consummation of
such transaction, (i) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities immediately
prior to the consummation of such transaction beneficially own, directly or
indirectly, more than 50% of, respectively, the then outstanding shares of
common stock or comparable interests if such resulting entity is not a
corporation and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors or
comparable management group, as the case may be, of the corporation or other
entity resulting from such Business Combination (including, without limitation,
a corporation which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or through one or
more subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Business Combination, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, as the case may be, (ii) no
Person 

 

4

 

(excluding any
corporation resulting from such Business Combination or any employee benefit
plan (or related trust) of the Company or such corporation resulting from such
Business Combination) beneficially owns, directly or indirectly, 20% or more
of, respectively, the then outstanding shares of common stock or comparable
interests if such resulting entity is not a corporation of the corporation or
other entity resulting from such Business Combination or the combined voting
power of the then outstanding voting securities entitled to vote generally in
the election of directors or comparable management group of such corporation or
other entity except to the extent that such ownership existed prior to the
Business Combination and (iii) at least a majority of the members of the
board of directors or comparable management group of the corporation or other
entity resulting from such Business Combination were members of the Incumbent
Board at the time of the execution of the initial agreement, or at the time of
the action of the Board of Directors of the Company (the “Board”),
providing for such Business Combination.

 

(3)  “Outstanding Company Common Stock” shall mean the
then outstanding shares of Common Stock.

 

(4)  “Outstanding Company Voting
Securities” shall mean the combined voting power of the then outstanding
voting securities of the Company entitled to vote generally in the election of
directors.

 

(5)  “Incumbent Board”
shall mean all the individuals who collectively, as of the date hereof,
constitute the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company’s stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board; but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a person other than a
person who is then a member of the Board.

 

3.  Valid Issuance of Common Stock.
The Company possesses the full authority and legal right to issue the Warrants
and the Shares issuable pursuant to the Warrants. The issuance of the Warrants
vests in the holder the entire legal and beneficial interests in the Warrants,
free and clear of any liens, claims and encumbrances and subject to no legal or
equitable restrictions of any kind except as described herein. The Shares that
are issuable upon exercise of the Warrants, when issued, sold and delivered in
accordance with the terms of this Organizer/Founder Warrant Agreement for the
consideration expressed herein, will be duly and validly issued, fully paid and
non-assessable.

 

4.  Transfer
and Assignment.

 

(a)  The Warrants granted in this
Organizer/Founder Warrant Agreement may not be transferred or sold unless the
transfer is (i) exempt from regulatory approval or such 

 

5

 

approval is obtained and (ii) permissible under applicable law,
including state and federal securities laws.

 

(b)  The Shares issued upon exercise of
the Warrants granted in this Organizer/Founder Warrant Agreement may not be
transferred or sold unless the transfer is (i) exempt from regulatory
approval or such approval is obtained and (ii) permissible under
applicable law, including state and federal securities laws.  Any certificates evidencing such Shares will
bear a legend to that effect.

 

5.  Mandatory
Exercise; Termination.  

 

(a)  The Company or the Bank may be
required to increase its capital to meet capital requirements imposed by
statute, rule, regulation or guideline. In order to achieve such capital
increase, any of the Regulatory Agencies may direct the Company to require the
Warrant Holder to either (i) exercise or forfeit all or part of the
Warrants or (ii) allow the Warrants to be terminated. If any of the
Regulatory Agencies so direct the Company, then the Warrant Holder must
exercise or forfeit the Warrants as set forth below, subject to the terms set
forth in Section 1(f) hereof.

 

(b)  When the Company or the Bank is
required to increase its capital as described in subsection 5(a) above,
the Company shall send a notice (the “Notice”) to the Warrant Holder (i) specifying
the number of Shares relating to the Warrants for which the Warrants must be
exercised (the “Number”); (ii) specifying the date prior to which
the Warrants must be totally or partially exercised, as the case may be (the “Deadline”);
and (iii) stating that the failure of the Warrant holder to exercise the
Warrants shall result in their automatic termination. If less than all shares
relating to warrants and options held by all holders of warrants or options of
the Company under agreements containing a provision substantially similar to
this one are required by the Company to be exercised or cancelled, the Number
for the Warrant Holder shall reflect a proportionate allocation based on the
number of Shares subject to this Organizer/Founder Warrant Agreement as
compared to the total number of shares subject to warrants and options held by
persons holding warrants with such a provision as a group.

 

(c)  If the Warrant Holder does not
exercise the Warrants pursuant to the terms of the Notice, this Organizer/Founder
Warrant Agreement shall be automatically terminated on the Deadline, without
further act or action by the Warrant Holder or the Company.  Thereafter, the Warrant Holder shall deliver
this Organizer/Founder Warrant Agreement to the Company for cancellation;
however, a failure to cancel this Organizer/Founder Warrant Agreement for any
reason (including non-delivery to the Company) shall not affect such
termination.  If the Number is less than
the total number of Shares that are then subject to exercise under this
Organizer/Founder Warrant Agreement, the Company shall issue a new Organizer/Founder
Warrant Agreement with respect to the Shares remaining covered hereby after the
partial exercise in compliance with Section 1(e) hereof.

 

6

 

6.  Covenants
of the Company. During the term of the Warrants, the
Company shall: 

 

(a)  at all times authorize, reserve and
keep available, solely for issuance upon exercise of the Warrants, sufficient shares
of Common Stock as shall be necessary to satisfy the requirements hereof;

 

(b)  on receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Organizer/Founder Warrant Agreement and, in the case of loss, theft or
destruction, on delivery of any indemnity agreement or bond reasonably
satisfactory in form and amount to the Company or, in the case of mutilation,
on surrender to the Company of this Organizer/Founder Warrant Agreement, at its
expense execute and deliver, in lieu of this Organizer/Founder Warrant
Agreement, a new Organizer/Founder Warrant Agreement of like tenor; and

 

(c)  in connection with transfers
permitted in Section 4 above, on surrender for exchange of this Organizer/Founder
Warrant Agreement or any Organizer/Founder Warrant Agreement substituted
herefor pursuant hereto, properly endorsed, to the Company, at its expense,
issue and deliver to or on the order of the holder thereof a new Organizer/Founder
Warrant Agreement of like tenor, in the name of such Warrant Holder, calling in
the aggregate on the face thereof for the issuance of the number of Shares
issuable pursuant to the terms of the Organizer/Founder Warrant Agreement so
surrendered.

 

7.  Miscellaneous.

 

(a)  Notices. All notices,
requests, demands and other communications required or permitted hereunder
shall be in writing and shall be deemed to have been duly given when delivered
by hand, telegram or facsimile transmission, or if mailed, by postage prepaid
first class mail, on the third business day after mailing, to the following
address (or at such other address as a party may notify the other hereunder):

 

To the Company:

 

Coastal Carolina Bancshares, Inc.

2305 N. Oak Street

Myrtle Beach, South Carolina 
29577

Attn:  

President 

 

 

To the Warrant Holder:

	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

7

 

(b)  Amendment. Neither this
Organizer/Founder Warrant Agreement nor the rights granted hereunder may be
amended, changed or waived except in a writing signed by each party hereto.

 

(c)  Counterparts. This Organizer/Founder
Warrant Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which shall constitute one and the same
instrument.

 

(d)  Governing Law. This
Organizer/Founder Warrant Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of South Carolina.

 

IN WITNESS WHEREOF, the Company has executed
and the Warrant Holder has signed and accepted this Organizer/Founder Warrant
Agreement as of the date and year first above written.

 

 

	
   

  	
  COASTAL CAROLINA BANCSHARES,

  
	
   

  	
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Michael D. Owens

  
	
   

  	
  Its:

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WARRANT HOLDER

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
     [name]

  

 

8Exhibit 4.4

 

COASTAL
CAROLINA BANCSHARES, INC.

 

DIRECTOR
WARRANT AGREEMENT

 

                    ,
2008

 

 

	
  Warrant Holder:                                 

  	
   

  	
  No. of Shares:                                 

  

 

Coastal Carolina Bancshares, Inc. (the “Company”),
a South Carolina corporation and the holding company for Coastal Carolina
National Bank (the “Bank”), hereby grants to the person identified above
(the “Warrant Holder”) warrants (the “Warrants”) to purchase the
number of shares (the “Shares”) of common stock of the Company (the “Common
Stock”) set forth above, in recognition of the financial risk undertaken by
the Warrant Holder in organizing the Bank and the Company and the continuing
involvement of the Warrant Holder in the management of the Company and the Bank.
Such Warrants are granted on the following terms and conditions:

 

1.  Exercise of Warrants.  One-third of the Shares subject to the
Warrants granted in this Director Warrant Agreement shall vest on each of the
first three anniversaries of the date of the opening of the Bank, subject to
the Warrant Holder’s continued service with the Company or the Bank as of such
date as an executive officer or director. Exercise of the Warrants is subject
to the following:

 

(a)  Exercise
Price.  The exercise price
(the “Exercise Price”) shall be $10.00 per Share, subject to adjustment
pursuant to Section 2 below.

 

(b)  Expiration
of Warrant Term.  The Warrants
will expire at 5:00 p.m. Eastern Time on the tenth anniversary of the
opening date of the Bank (subject to earlier termination in certain
circumstances pursuant to Section 2 or 5 below), and may not be exercised
thereafter (the “Expiration Date”).

 

(c)  Payment.  The purchase price for Shares as to
which the Warrants are being exercised shall be paid in cash, by wire transfer,
by certified or bank cashier’s check or by personal check drawn on funds on
deposit with the Bank.

 

(d)  Method
of Exercise.  The Warrants
shall be exercisable by a written notice delivered to the President or
Secretary of the Company which shall:

 

(1)  State the Warrant Holder’s election to exercise the Warrants,
the number of Shares with respect to which it is being exercised, the person in
whose name the stock certificate for such Shares is to be registered, and such
person’s address and tax identification number (or, if more than one, the
names, addresses and tax identification numbers of such persons);

 

(2)  Be signed by the person or persons entitled to exercise the
Warrants and, if the Warrants are being exercised by any person or persons
other than the original Warrant Holder, be accompanied by proof satisfactory to
counsel for the Company of the right of such person or persons to exercise the
Warrants; and

 

1

 

(3)  Be accompanied by an executed copy of this Director Warrant
Agreement.

 

(e)  Partial
Exercise.  In the event of a
partial exercise of the Warrants, the Company shall either issue a new
agreement for the balance of the Shares subject to this Director Warrant
Agreement after such partial exercise, or it shall conspicuously note hereon
the date and number of Shares purchased pursuant to such exercise and the
number of Shares remaining covered by this Director Warrant Agreement.

 

(f)  Restrictions
on Exercise.  The Warrants may
not be exercised (i) if the issuance of Shares upon such exercise would
constitute a violation of any applicable federal or state securities or banking
laws or other law or regulation or (ii) unless the Company or the Warrant
Holder, as applicable, obtains any approval or other clearance which the Company
determines to be necessary or advisable from the Federal Reserve Board, the
Federal Deposit Insurance Corporation, the Comptroller of the Currency or any
other state or federal banking regulatory agency with regulatory authority over
the operation of the Company or the Bank (collectively the “Regulatory
Agencies”). The Company may require representations and warranties from the
Warrant Holder to comply with applicable laws or regulations, including the Securities
Act of 1933, as amended (the “Act”), and state securities laws. In
addition, the Company shall not be obligated to deliver any Shares pursuant to
the exercise of the Warrants and shall have no obligation to settle such
Warrants exercise unless a registration statement under the Act with respect to
the Shares is effective and a prospectus complying in all material respects
with the Act (a “Prospectus”) is available for delivery by the Company.
In the event that a registration statement with respect to the Shares
underlying such Warrants is not effective under the Act or a Prospectus
relating to the Shares is not available for delivery by the Company, the
Warrant Holder shall not be entitled to exercise the Warrants and the Warrants
may have no value and expire worthless.

 

(g)  No Net Cash
Settlement.  In no event will
the Company be required to net cash settle the exercise of Warrants.

 

(h)  Minimum Exercise.  No less
than 100 shares of Common Stock may be purchased upon any one exercise of the Warrants
granted hereunder unless the number of shares purchased at such time is the
total remainder of shares subject to Warrants hereunder.

 

(i)  No Fractional Shares. 
A Warrant shall not be
exercisable for a fractional share; provided that, if a Warrant for a
fractional share results from an event described in Section 2 hereof,
then, upon exercise of such Warrant, the Warrant Holder shall receive the Fair
Market Value of such fractional share in cash. 
“Fair Market Value” on any date with respect to the Common
Stock shall mean:

 

(1)  if the Common Stock is listed on a
national securities exchange, the last reported sale price of a share of the
Common Stock on such exchange or, if no sale occurs on that date, the average
of the reported closing bid and asked prices on that date;

 

(2)  if the Common Stock is otherwise publicly
traded, the last reported sale price of a share of the Common Stock under the
quotation system under 

 

2

 

which
the sale price is reported or, if no sale occurs on that date, the average of
the reported closing bid and asked prices on that date under the quotation
system under which the bid and asked prices are reported;

 

(3)  if no such last sales price or average of
the reported closing bid and asked prices are available on that date, the last
reported sale price of a share of the Common Stock, or if no sale takes place,
the average of the reported closing bid and asked prices as so reported for the
immediately preceding business day (i) on the national securities exchange
on which the Common Stock is listed or (ii) if the Common Stock is
otherwise publicly traded, under the quotation system under which such data are
reported, or

 

(4)  if none of the prices described above is
available, the value of a share of the Common Stock as reasonably determined in
good faith by the Board (as hereinafter defined) in a manner that it believes
to be in accordance with the Code.

 

2.  Anti-Dilution; Business
Combination; Dissolution.

 

(a)  Anti-Dilution; Business
Combination; Dissolution.  Subject to any action required by
the stockholders of the Company, the number of shares of Common Stock covered
by each outstanding Warrant and the per-share exercise price applicable to each
Warrant shall, in each case, be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a
subdivision or consolidation of shares or the payment of a stock dividend (but
only on the Common Stock) or any other increase or decrease in the number of
shares of Common Stock effected without receipt of consideration by the
Company.

 

Subject
to any action required by the stockholders, in the event of a Business
Combination (as defined below) that is not a Change of Control Business Combination
(as defined below), each Warrant shall pertain to and apply to the securities and
other consideration that a holder of the number of Shares of Common Stock
underlying the Warrant would have been entitled to receive in the Business
Combination. In the event of (i) a Change of Control Business Combination
or (ii) the complete liquidation or dissolution of the Company, then each
outstanding Warrant shall terminate; provided however, that the Warrant Holder
shall, in such event, have the right immediately prior to such Change of
Control Business Combination or complete liquidation or dissolution, to
exercise the Warrants in whole or in part.

 

In
the event of a change in the Common Stock as presently constituted, which
change is limited to a change of all of the authorized shares with par value
into the same number of shares with a different par value or without par value,
the shares resulting from any such change shall be deemed to be Shares within
the contemplation of this Director Warrant Agreement.

 

3

 

Except
as expressly provided in this subsection 2(a), the Warrant Holder shall have no
rights by reason of (i) any subdivision or consolidation of shares of any
class of stock of the Company, (ii) any stock dividend, (iii) any
other increase or decrease in the number of shares of stock of any class, (iv) any
dissolution, liquidation, merger, consolidation, spin-off, split-off or split-up
of assets of the Company or stock of another corporation or (v) any issuance
by the Company of shares of stock of any class or securities convertible into
shares of stock of any class. Moreover, except as expressly provided in this
subsection 2(a), the occurrence of one or more of the above-listed events or of
any other similar event shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number of, or the exercise price relative
to, the Shares underlying the Warrants.

 

The
grant of the Warrants pursuant to this Director Warrant Agreement shall not
affect in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes to, of or in its capital or
business structure or to merge, consolidate, dissolve, liquidate, sell or
transfer all or any part of its business or assets.

 

(b)  Rights as a Stockholder.  The Warrant Holder shall have no rights as a
stockholder with respect to any Shares underlying the Warrants until the date
of the issuance of Shares upon payment of the exercise price. No adjustments
shall be made for dividends (ordinary or extraordinary, whether in cash,
securities or other property) or distributions or other rights for which the
record date is prior to the date of such issuance, except as provided in
subsection 2(a).

 

(c)  Definitions.

 

(1) 
“Business Combination” shall mean consummation
of a reorganization, merger, consolidation, sale or other disposition of all or
substantially all of the assets of the Company or the Company’s acquisition of
assets of another corporation, partnership or limited liability company.

 

(2)  “Change of Control Business Combination”
shall mean consummation of a Business Combination, unless, following the
consummation of such transaction, (i) all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to the consummation of such transaction beneficially own,
directly or indirectly, more than 50% of, respectively, the then outstanding
shares of common stock or comparable interests if such resulting entity is not
a corporation and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors or
comparable management group, as the case may be, of the corporation or other
entity resulting from such Business Combination (including, without limitation,
a corporation which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or through one or
more subsidiaries) in substantially the same proportions as their ownership,
immediately 

 

4

 

prior to such Business Combination, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities, as the case may
be, (ii) no Person (excluding any corporation resulting from such Business
Combination or any employee benefit plan (or related trust) of the Company or
such corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of, respectively, the then outstanding
shares of common stock or comparable interests if such resulting entity is not
a corporation of the corporation or other entity resulting from such Business
Combination or the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors or
comparable management group of such corporation or other entity except to the
extent that such ownership existed prior to the Business Combination and (iii) at
least a majority of the members of the board of directors or comparable
management group of the corporation or other entity resulting from such
Business Combination were members of the Incumbent Board at the time of the
execution of the initial agreement, or at the time of the action of the Board
of Directors of the Company (the “Board”), providing for such Business
Combination.

 

(3) 
“Outstanding Company Common Stock” shall mean the then outstanding shares
of Common Stock.

 

(4) 
“Outstanding Company Voting Securities” shall mean the combined voting
power of the then outstanding voting securities of the Company entitled to vote
generally in the election of directors.

 

(5) 
“Incumbent Board” shall mean all the individuals who collectively, as of
the date hereof, constitute the Board; provided, however, that any individual
becoming a director subsequent to the date hereof whose election, or nomination
for election by the Company’s stockholders, was approved by a vote of at least
a majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board; but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a person other than a
person who is then a member of the Board.

 

3.  Valid Issuance of Common Stock.
 The Company possesses the full authority
and legal right to issue the Warrants and the Shares issuable pursuant to the
Warrants. The issuance of the Warrants vests in the holder the entire legal and
beneficial interests in the Warrants, free and clear of any liens, claims and
encumbrances and subject to no legal or equitable restrictions of any kind
except as described herein. The Shares that are issuable upon exercise of the
Warrants, when issued, sold and delivered in accordance with the terms of this Director
Warrant Agreement for the consideration expressed herein, will be duly and
validly issued, fully paid and non-assessable.

 

5

 

4.  Transfer and
Assignment.

 

(a)  Except in the case of the Warrant
Holder’s death, and thereupon only by will or under the laws of descent and
distribution, this Director Warrant Agreement and the Warrants may not be
assigned, transferred, pledged or hypothecated in any way (whether by operation
of law or otherwise) and shall not be subject to execution, attachment or
similar process. Any attempted assignment, transfer, pledge, hypothecation or
other disposition of these Warrants contrary to the provisions hereof shall be
without legal effect.

 

(b) The Shares issued upon exercise of
the Warrants granted in this Director Warrant Agreement may not be transferred
or sold unless the transfer is (i) exempt from regulatory approval or such
approval is obtained and (ii) permissible under applicable law, including
state and federal securities laws.  Any
certificates evidencing such Shares will bear a legend to that effect.

 

5.  Mandatory
Exercise; Termination.

 

(a)  Warrant Holder shall exercise all
of Warrant Holder’s then exercisable Warrants within 90 days of the date
that Warrant Holder ceases to serve the Company or the Bank, as the case may
be, as an executive officer or director, or the then exercisable Warrants shall
terminate; provided that such 90 day period shall be extended to one year from
such cessation date if the cessation of service was a result of the Warrant
Holder’s death or disability.  If during
such initial 90 day period the Warrant Holder is re-elected an executive
officer or director of the Bank, such re-election shall have no impact on such
termination.  In the event the Warrant
Holder fails to exercise any of the Warrants referred to in this subparagraph
within the applicable time period, such Warrants shall terminate and be
forfeited.

 

(b)  The Company or the Bank may be
required to increase its capital to meet capital requirements imposed by
statute, rule, regulation or guideline. In order to achieve such capital
increase, any of the Regulatory Agencies may direct the Company to require the
Warrant Holder to either (i) exercise or forfeit all or part of the
Warrants or (ii) allow the Warrants to be terminated. If any of the
Regulatory Agencies so direct the Company, then the Warrant Holder must
exercise or forfeit the Warrants as set forth below, subject to the terms set
forth in Section 1(f) hereof.

 

(c)  When the Company or the Bank is
required to increase its capital as described in subsection 5(b) above,
the Company shall send a notice (the “Notice”) to the Warrant Holder (i) specifying
the number of Shares relating to the Warrants for which the Warrants must be
exercised (the “Number”); (ii) specifying the date prior to which
the Warrants must be totally or partially exercised, as the case may be (the “Deadline”);
and (iii) stating that the failure of the Warrant holder to exercise the
Warrants shall result in their automatic termination.  If less than all shares relating to warrants
and options held by all holders of warrants or options of the Company under
agreements containing a provision substantially similar to this one are
required by the Company to be exercised or cancelled, the Number for the
Warrant Holder shall reflect a proportionate allocation based on the number of
Shares subject to this Director Warrant Agreement as compared 

 

6

 

to the total number of shares subject to warrants and options held by
persons holding warrants or options with such a provision as a group.

 

(d)  If the Warrant Holder does not
exercise the Warrants pursuant to the terms of the Notice, this Director
Warrant Agreement shall be automatically terminated on the Deadline, without
further act or action by the Warrant Holder or the Company.  Thereafter, the Warrant Holder shall deliver
this Director Warrant Agreement to the Company for cancellation; however, a
failure to cancel this Director Warrant Agreement for any reason (including
non-delivery to the Company) shall not affect such termination.  If the Number is less than the total number of
Shares that are then subject to exercise under this Director Warrant Agreement,
the Company shall issue a new Director Warrant Agreement with respect to the
Shares remaining covered hereby after the partial exercise in compliance with Section 1(e) hereof.

 

6.  Covenants of
the Company. During the term of the Warrants, the Company shall:

 

(a)  at all times authorize, reserve and
keep available, solely for issuance upon exercise of the Warrants, sufficient shares
of Common Stock as shall be necessary to satisfy the requirements hereof;

 

(b)  on receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Director Warrant Agreement and, in the case of loss, theft or destruction,
on delivery of any indemnity agreement or bond reasonably satisfactory in form
and amount to the Company or, in the case of mutilation, on surrender to the
Company of this Director Warrant Agreement, at its expense, execute and
deliver, in lieu of this Director Warrant Agreement, a new Director Warrant Agreement
of like tenor; and

 

(c)  in connection with transfers
permitted in Section 4(b) above, on surrender for exchange of this Director
Warrant Agreement or any Director Warrant Agreement substituted herefor
pursuant hereto, properly endorsed, to the Company, at its expense, issue and
deliver to or on the order of the holder thereof a new Director Warrant Agreement
of like tenor, in the name of such Warrant Holder, calling in the aggregate on
the face thereof for the issuance of the number of Shares issuable pursuant to
the terms of the Director Warrant Agreement so surrendered.

 

7.  Miscellaneous.

 

(a)  Notices.  All notices, requests, demands and other
communications required or permitted hereunder shall be in writing and shall be
deemed to have been duly given when delivered by hand, telegram or facsimile
transmission, or if mailed, by postage prepaid first class mail, on the third
business day after mailing, to the following address (or at such other address
as a party may notify the other hereunder):

 

	
  To
  the Company:

  
	
   

  
	
  Coastal
  Carolina Bancshares, Inc.

  
	
  2305
  N. Oak Street

  

 

7

 

	
  Myrtle
  Beach, South Carolina 29577

  
	
  Attn:

  
	
  President

  

 

 

	
  To the Warrant Holder:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
					

 

(b)  Amendment.  Neither this Director Warrant Agreement nor the
rights granted hereunder may be amended, changed or waived except in a writing
signed by each party hereto.

 

(c)  Counterparts.  This Director Warrant Agreement may be
executed in counterparts, each of which shall be deemed an original, but all of
which shall constitute one and the same instrument.

 

(d)  Governing Law.  This Director Warrant Agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of South Carolina.

 

8

 

IN WITNESS WHEREOF, the Company has executed
and the Warrant Holder has signed and accepted this Director Warrant Agreement
as of the date and year first above written.

 

	
   

  	
   

  	
   

  	
  COASTAL
  CAROLINA BANCSHARES,

  
	
   

  	
   

  	
   

  	
  INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Michael
  D. Owens

  
	
   

  	
   

  	
   

  	
  Its:
  

  	
  President
  and Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  WARRANT
  HOLDER

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
     [name]

  
	
   

  	
   

  	
   

  	
   

  

 

 

9

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