Document:

Exhibit 10.6(b)

 

SOUTH
CAROLINA BANK AND TRUST

 

RESTATED
ESCROW AGREEMENT

 

Relating
to Subscriptions for Shares of  Coastal
Carolina Bancshares, Inc.

 

This Restated Escrow Agreement (the “Restated Agreement”)
is made and entered into as of the       th day of
                      ,
2008, by and between Coastal Carolina Bancshares, Inc., a South Carolina corporation  (the “Company”), South Carolina Bank and Trust (the “Escrow
Agent”), and Commerce Street Capital, LLC (the “Agent”).

 

WHEREAS, the Company proposes to offer and sell (the “Offering”)
up to 3,000,000 shares of Common Stock, $0.01 par value per share (the “Shares”),
to investors at $10.00 per Share pursuant to a public offering registered
pursuant to the Securities Act of 1933;

 

WHEREAS, the Company and the Escrow Agent previously
entered into an Escrow Agreement dated June 6, 2008 (the “Original
Agreement”);

 

WHEREAS, since the date of the Original Agreement, the
Company has entered into an Agency Agreement dated                       ,
2008, with the Agent under which the Agent has been engaged to act as sales
agent and assist in the sale of the Shares on a “best efforts” basis; and

 

WHEREAS, as a result, it is desired that the Agent become a
party to the escrow arrangement for subscription funds received in the
Offering, and the Company, the Escrow Agent and the Agent desire to modify and
restate the Original Agreement by entering into this Restated Agreement.

 

NOW, THEREFORE, in consideration of the premises and other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

 

1.              ESCROW
DEPOSIT.

 

a.                  Each investor
will deliver the funds in payment for the Shares purchased by such investor, as
set forth in the Subscription Agreement, to the Company for further delivery to
the Escrow Agent.  The Company will
collect and deliver to the Escrow Agent appropriate IRS W-9 Forms for each
investor.  Checks should be made payable
to “South Carolina Bank and Trust, as Escrow Agent for Coastal Carolina
Bancshares, Inc.” and sent to the Escrow Agent promptly.  If any check does not clear normal banking
channels in due course, the Escrow Agent will promptly notify the Company.  Any check which does not clear normal banking
channels and is returned by the drawer’s bank to Escrow Agent will be promptly
turned over to the Company along with all other subscription documents relating
to such check.  Any check received that
is made payable to a party other than the Escrow Agent shall be returned to the
Company for return to the proper party. 
The Company in its sole and absolute discretion may reject any
subscription for Shares in whole or in part for any reason and upon such
rejection, it shall notify and instruct the Escrow Agent in writing to return
the appropriate amount of Escrowed Funds by check made payable to the
investor.  If the Company rejects or
cancels any subscription for any reason, the Company will retain any interest
earned on the Escrowed Funds to help defray organizational costs.

 

b.                  Subscription
Agreements for the Shares shall be promptly reviewed for accuracy by the
Company and, immediately thereafter, the Company shall promptly deliver to the
Escrow 

 

1

 

Agent
the following information: (i) the name and address of the investor; (ii) the
number of Shares subscribed for by such investor; (iii) the subscription
price paid by such investor; (iv) the investor’s tax identification number
certified by such investor; and (v) a copy of the investor’s Subscription
Agreement.

 

2.              INVESTMENT
OF ESCROW DEPOSIT.  All funds
received by the Escrow Agent pursuant to this Restated Agreement shall be
invested in compliance with applicable laws, rules and regulations,
including Rule 15(c)(2-4) under the Securities Exchange Act of 1934 and
applicable requirements of regulatory agencies. 
To the extent permissible thereunder, such funds may be invested in
deposit accounts or certificates of deposit which are insured by the Federal
Deposit Insurance Corporation or another agency of the United States
government, short-term securities issued or fully guaranteed by the United
States government, federal funds, or such other investments as the Escrow Agent
and the Company shall agree, provided such investments may be liquidated
without penalty within one business day. 
The Company shall provide the Escrow Agent with instructions from time
to time concerning in which of the specific investment instruments described
above the Escrowed Funds shall be invested, and the Escrow Agent shall adhere
to such instructions.  Unless and until
otherwise instructed by the Company, the Escrow Agent shall invest the Escrowed
Funds in an interest bearing account that complies with such laws, rules,
regulations and requirements.  Interest
will begin accruing no later than the next business day after receipt.  Incoming wire transfers received by 6:00 P.M.
(ET) will be posted as soon as feasible. 
Incoming wire transfers received without a Subscription Agreement will
be posted, but returned after five business days if a Subscription Agreement
has not been received by the Company. Interest and other earnings shall start
accruing on such funds as soon as such funds would be deemed to be available
for access under applicable banking laws and pursuant to the Escrow Agent’s own
banking policies.

 

3.              CERTIFICATION
OF FUNDS.  Upon receipt
of (i) funds in the amount of at least $21 million in payment for Shares, less
the amount certified by the Company to have been received by it as
subscriptions from organizers, founders and executive officers (which do not
have to be held in escrow as of the date of such certification) and (ii) at
the direction of Company, the Escrow Agent shall certify to the appropriate
regulatory authorities that the Escrow Agent holds a minimum of $21 million less
the amount certified by the Company to have been received by it as subscriptions
from organizers, founders and executive officers (which do not have to be held
in escrow as of the date of such certification) on deposit in the escrow
account for the purchase of Shares in Company.

 

4.              DISTRIBUTION
OF FUNDS.  The Escrow
Agent shall distribute the funds held by it under this Restated Agreement as
follows:

 

a.                  Upon receipt of
(i) funds in the amount of at least $21 million in payment for Shares, (ii) 
receipt of a certificate from the Agent that all of the conditions set forth in
the Agency Agreement between the Company and the Agent have been satisfied or
otherwise waived, and (iii) a certificate executed by the Company’s CEO or
CFO attesting that all other conditions to the release of funds as described in
the Company’s prospectus pertaining to the offering, including but not limited
to approval of the appropriate bank regulators, have been met and directing the
Escrow Agent to distribute all funds then held by the Escrow Agent pursuant to this
Restated Agreement to the Company, then the Escrow Agent shall deliver the
funds, by cashier’s check, wire transfer, or other form of payment mutually
acceptable to the Company and the Escrow Agent, to the Company, together with
the income earned thereon pursuant to subsection (c) of this Section 4.  The parties anticipate that there may be
multiple distributions of escrowed funds and that both the Agent and the
Company will deliver a certificate as contemplated above prior to each such
distribution.  No distribution will be
made until the last investor deposit to be distributed in that distribution has
been made for at least two business days. 
The Company shall provide account information and other necessary
directions for disbursements by the Escrow Agent to it under this Restated Agreement.  The Escrow Agent was provided a copy of the
form of Subscription Agreement at the signing of the Original Agreement.

 

2

 

b.               Upon (i) receipt of
direction from the Company, to return the funds to the investors; or (ii) in
the event the Escrow Agent shall have received less than $21 million or shall
have received no direction or certificate from the Company pursuant to either
subsection (a) or this subsection (b) of this Section 4 on or prior
to initial closing date of  the Offering
as described in the Company’s prospectus (unless the Company notifies the
Escrow Agent that the Offering has been extended), the Escrow Agent shall
distribute such funds to the investors, without interest, pursuant to
subsection (c) of this Section 4. 
The Company may give notice to the Escrow Agent that the Company is
canceling its offer of the Shares prior to the ultimate expiration date of the
Offering as described in the Company’s prospectus (beyond such date the
Offering may not be extended by the Company), and the Escrow Agent shall
distribute the funds to the investors in accordance with this Restated Agreement.

 

c.               Any income earned on the
investment of funds received under this Restated Agreement will first be
applied against the Escrow Agent’s fee set forth in Section 9 hereof and
any expense of the Escrow Agent incurred pursuant to Section 6 hereof,
provided that in no event shall the Escrow Agent apply any of the investors’
original investment principal towards such fees and expenses.  To the extent that such income exceeds the
Escrow Agent’s fee and expenses, the Escrow Agent shall distribute such excess
to the Company, in the event that funds are returned to investors pursuant to
subsection (b) of this Section. 
Such excess shall also be delivered to the Company, in the event that
the funds received and held hereunder are delivered to the Company pursuant to
subsection (a) of this Section.  To
the extent that the income earned on the investment of funds does not exceed
the Escrow Agent’s fees and expenses, the Company shall promptly pay the Escrow
Agent the amount by which the Escrow Agent’s fees and expenses exceed the
income.

 

5.              AUTHORIZATION
FOR DISBURSEMENT.  The Escrow
Agent is hereby authorized and directed to issue its checks for each
disbursement hereunder and the Escrow Agent shall be relieved of all liability
with respect to making the disbursements in accordance with the provisions
hereof.

 

6.              PROFESSIONAL
SERVICES USED BY ESCROW AGENT.  The Escrow
Agent may engage the services of such attorneys, accountants, and other
professionals, as the Escrow Agent may, in its sole discretion, deem advisable
to carry out its duties under the Restated Agreement.  The Company agrees to reimburse the Escrow
Agent for all costs, expenses and professional fees incurred hereunder which
are not covered by income earned on escrowed funds pursuant to Section 4(c)
hereof, including all legal fees and expenses incurred in the review of this Restated
Agreement.

 

7.              LIABILITY
OF ESCROW AGENT.

 

a.                  In performing any of its duties under the Restated Agreement, or upon the
claimed failure to perform its duties hereunder, the Escrow Agent shall not be
liable to anyone for any damages, losses or expenses which it may incur as a
result of the Escrow Agent so acting, or failing to act; provided, however, the
Escrow Agent shall be liable for damages arising out of its willful default or
misconduct or its gross negligence under this Restated Agreement.  Accordingly, the Escrow Agent shall not incur
any such liability with respect to (i) any action taken or omitted to be
taken in good faith upon advice of its counsel or counsel for the Company which
is given with respect to any questions relating to the duties and
responsibilities of the Escrow Agent hereunder; or (ii) any action taken
or omitted to be taken in reliance upon any document, including any written
notice or instructions provided for in this Restated Agreement, not only as to
its due execution and to the validity and effectiveness of its provisions but
also as to the truth and accuracy of any information contained therein, if the
Escrow Agent shall in good faith believe such document to be genuine, to have
been signed or presented by a proper person or persons, and to conform with the
provisions of this Restated Agreement.

 

3

 

b.                  The Company agrees to indemnify and hold harmless the Escrow Agent
against any and all losses, claims, damages, liabilities and expenses,
including, without limitation, reasonable costs of investigation and counsel
fees and disbursements which may be imposed by the Escrow Agent or incurred by
it in connection with its acceptance of this appointment as Escrow Agent
hereunder or the performance of its duties hereunder, including, without
limitation, any litigation arising from this Restated Agreement or involving
the subject matter thereof; except, that if the Escrow Agent shall be found
guilty of willful default, misconduct or gross negligence under this Restated Agreement,
then, in that event, the Escrow Agent shall bear all such losses, claims,
damages and expenses.

 

c.                  If a dispute ensues between any of the parties hereto which, in the
opinion of the Escrow Agent, is sufficient to justify its doing so, the Escrow
Agent shall retain legal counsel of its choice as it reasonably may deem
necessary to advise it concerning its obligations hereunder and to represent it
in any litigation to which it may be a party by reason of this Restated Agreement.  The Escrow Agent shall be entitled to tender
into the registry or custody of any court of competent jurisdiction all money
or property in its hands under the terms of this Restated Agreement, and to
file such legal proceedings as it deems appropriate, and shall thereupon be
discharged from all further duties under this Restated Agreement.  Any such legal action may be brought in any
such court as the Escrow Agent shall determine to have jurisdiction
thereof.  In connection with such
dispute, the Company shall indemnify the Escrow Agent against its court costs
and reasonable attorney’s fees incurred.

 

8.              RESIGNATION.  The Escrow Agent may resign at any time upon
fifteen days’ written notice to the Company. 
Such resignation shall take effect upon receipt by the Escrow Agent of
an instrument of acceptance executed by a successor escrow agent and subscribed
and consented to by the Company, and the delivery by the Escrow Agent to such
successor of any funds held under this Restated Agreement.  The Escrow Agent, if it has not received such
an instrument of acceptance prior to the expiration of fifteen calendar days
after the giving of notice of resignation, shall be discharged of its duties
and obligations hereunder only upon the deposit of any funds being held by it
under this Restated Agreement into, and the acceptance thereof, by a court of
competent jurisdiction, to which application shall be made for the appointment
of a successor escrow agent and such successor agent so appointed shall succeed
to all of the rights, duties and responsibilities of the Escrow Agent
hereunder.

 

9.              ESCROW
AGENT’S FEES.   There will be no fees charged by the Escrow
Agent for the administration and execution of this Restated Agreement.

 

10.       NOTICE.  All notices, certificates, requests, demands
and other communications or deliveries hereunder shall be in writing and shall
be sufficiently given and shall be deemed given when delivered, postage
prepaid, addressed as follows by Certified Mail (or other means, if unanimously
agreed to by the parties in writing):

 

	
   

  	
  To the Escrow Agent:

  	
  Attention: Alex Shuford

  
	
   

  	
   

  	
  South
  Carolina Bank and Trust

  
	
   

  	
   

  	
  Post
  Office Box 1030

  
	
   

  	
   

  	
  Columbia,
  SC 29202

  
	
   

  	
   

  	
   

  
	
   

  	
  To
  the Investors:

  	
  To
  the persons named and at the Addresses listed in the Subscription Agreements

  
	
   

  	
   

  	
   

  
	
   

  	
  To
  Company:

  	
  Attention:
  Holly L. Schreiber, CFO

  
	
   

  	
   

  	
  Coastal
  Carolina Bancshares, Inc.

  
	
   

  	
   

  	
  Post
  Office Box 2969

  
	
   

  	
   

  	
  Myrtle
  Beach, SC 29578

  

 

 

4

 

	
   

  	
  To
  Agent:

  	
  Attention:
  Charles W. Ingram

  
	
   

  	
   

  	
  Commerce
  Street Capital, LLC

  
	
   

  	
   

  	
  1700
  Pacific Avenue

  
	
   

  	
   

  	
  Suite 2020

  
	
   

  	
   

  	
  Dallas,
  Texas 75201

  

 

Any
party may, by notice given hereunder, designate any future or different
addresses to which subsequent notices, certificates, and other communications
shall be sent.

 

11.       REPRESENTATIONS OF THE COMPANY.  The Company hereby acknowledges that the
status of the Escrow Agent with respect to the offering of the Shares is that
of agent only for the limited purposes herein set forth, and hereby agrees it
will not represent or imply that the Escrow Agent, by serving as the Escrow
Agent hereunder or otherwise, has investigated the desirability or advisability
of an investment in the Shares, or has approved, endorsed or passed upon the
merits of the Shares, nor shall the Company use the name of the Escrow Agent in
any manner whatsoever in connection with the offer or sale of the Shares, other
than in the Company’s registration statement and related prospectus by acknowledgment
that the Escrow Agent has agreed to serve as Escrow Agent for the limited
purposes herein set forth.

 

12.       ENTIRE AGREEMENT.  This Restated Agreement sets forth the entire
agreement and understanding of the parties with regard to the escrow transaction
and supersedes all prior agreements, arrangements and understandings relating
to the subject matter hereof.

 

13.       AMENDMENT.  This Restated Agreement may be amended,
modified, superseded or canceled, and any of the terms or conditions hereof may
be waived, only by a written instrument executed by each party hereto or, in
the case of a waiver, by the party waiving compliance.  The failure of any party at any time or times
to require performance of any provision hereof shall in no manner affect the
right at a later time to enforce the same. 
No waiver in any one or more instances by any party of any condition, or
of the breach of any term contained in this Restated Agreement, whether by
conduct or otherwise, shall be deemed to be, or construed as, a further or
continuing waiver of any such condition or breach, or a waiver of any other
condition or of the breach of any other terms of this Restated Agreement.

 

14.       BINDING
EFFECT.  This Restated Agreement
shall inure to the benefit of and shall be binding upon the parties hereto and
their respective heirs, executors, successors, administrators and assigns.  The Escrow Agent shall be bound only by the
terms of this Restated Agreement and shall not be bound by or incur any
liability with respect to any other agreement or understanding between the
parties with respect to the subject matter hereof except as herein expressly
provided herein.  The Escrow Agent shall
not have any duties hereunder except those specifically set forth herein.

 

15.       ASSIGNMENT.  No interest of any party to this Restated Agreement
shall be assignable in the absence of a written agreement by and between the
parties to this Restated Agreement, executed with the same formalities as this
original Restated Agreement.

 

16.       SEVERABILITY.  In the event any court of competent
jurisdiction shall hold any provision of this Restated Agreement invalid or
unenforceable, such holding shall not invalidate or render unenforceable any
other provision hereof.

 

17.       EXECUTION
OF COUNTERPARTS.  This Restated Agreement
may be executed in several counterparts, each of which shall be an original,
and all of which shall constitute one and the same instrument.

 

5

 

18.       APPLICABLE
LAW.  This Restated Agreement
shall be construed and governed exclusively by the laws of the State of South
Carolina, without regard to its principles of conflicts of law.

 

19.       HEADINGS.  The headings used in this Restated
Agreement have been prepared for the convenience of reference only and shall not
control, affect the meaning of, or be taken as an interpretation of any
provisions of this Restated Agreement.

 

[Signatures on following
page]

 

6

 

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

 

 

	
   

  	
  ESCROW AGENT:  SOUTH CAROLINA BANK AND 

  TRUST

  
	
   

  	
   

  
	
   

  	
  By:

  
	
   

  	
   

  
	
   

  	
  Alex Shuford, Executive Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  COMPANY:

  	
  COASTAL CAROLINA BANCSHARES, 

  
	
   

  	
  INC

  
	
   

  	
   

  
	
   

  	
  By:

  
	
   

  	
   

  
	
   

  	
  Holly L. Schreiber, Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  AGENT:

  	
  COMMERCE STREET CAPITAL, LLC

  
	
   

  	
   

  
	
   

  	
  By:

  
	
   

  	
   

  
	
   

  	
  Charles W. Ingram, Senior Vice President

  
				

 

7Exhibit
10.9

 

	
   

  	
  

  	
  COMMERCE STREET CAPITAL,
  LLC

  1700 PACIFIC AVENUE, SUITE 2020

  DALLAS, TEXAS 75201

  214 - 545 - 6800

  www.commercestreetcapital.com

  

 

August 4,
2008

 

Mr. Michael D.
Owens, CEO

Coastal Carolina
Bancshares, Inc. /

Coastal Carolina National
Bank (In organization)

2305 North Oak Street

Myrtle Beach, SC 29577

 

Dear Mr. Owens,

 

In accordance with our
recent conversations, Commerce Street Capital, LLC (“CSC”), a Texas limited
liability company and registered as a broker or dealer under the Securities Exchange
Act of 1934, (the “Exchange Act”), is pleased to submit this (Engagement Letter
the “EL”) in connection with the proposed offering (the “Offering”) of shares
of common stock (“Common Shares”) of Coastal Carolina Bancshares, Inc.
(the “Company”), a South Carolina corporation, and a holding company for
Coastal Carolina National Bank (the “Bank”) to prospective investors.  This letter supersedes and replaces in its
entirety our Engagement Letter of June 25, 2008, and is intended to
address certain specifics of CSC’s role as consultant to the Company.  The Company acknowledges that, with respect
to the Offering, CSC will act on a “best efforts” basis only, and not pursuant
to any “firm commitment.”

 

In connection with the
Offering, CSC proposes to assist management and the Board of Directors of the
Company on (i) the establishment of a comprehensive plan for the
development and execution of the Offering as well as to assist the Company’s
and the Bank’s management in establishing a computer database that will enable
the Company’s and the Bank’s management and directors to gauge the progress of
the Offering on a daily basis, (ii) how best to coordinate all aspects of
the Company’s stock sales efforts, including assistance as to sales techniques
which have been successful in other stock offerings, and (iii) facilitating
all retirement account purchases of Common Shares through the various types of
retirement accounts that potential investors may have.  The Company assures CSC that its board of
directors will remain active in the Offering process and its management team
will be present each day during the Offering to lead the Offering process,
including the guidelines discussed in Attachment A.

 

The following generally
address certain matters related to the Offering.

 

	
   

  	
  1.

  	
  The Offering will
  consist of a minimum of approximately 2,100,000 and a maximum of
  approximately 3,000,000 Common Shares to be sold by the Company at a price of
  $10.00 per share.

  
	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  The Common Shares to be
  offered will be registered by the Company under the Securities Act of 1933,
  as amended (the “Securities Act”) on the appropriate registration statement
  (the “Registration Statement”). The Company agrees that

  

 

 

 

 

	
   

  	
   

  	
  the Registration
  Statement (a) shall comply with the applicable provisions of the
  (i) Securities Act and the rules and regulations promulgated
  thereunder, (ii) to the extent applicable, the Exchange Act of 1934 and
  the rules and regulations promulgated thereunder, (iii) laws
  promulgated by the Company’s and the Bank’s regulators, and (b) shall
  not contain an untrue statement of a material fact or omit to state a
  material fact necessary to make the statements therein, in light of the
  circumstances under which they are made, not misleading.

  
	
   

  	
   

  	
   

  
	
   

  	
  3.

  	
  The Company will cause
  to be established appropriate procedures to ensure that, prior to the
  issuance of the Common Shares, subscription funds are held in a separate
  escrow account and not in the Company’s or the Bank’s general funds.

  
	
   

  	
   

  	
   

  
	
   

  	
  4.

  	
  As compensation for
  CSC’s services, CSC will be paid the following fees and reimbursed for its
  expenses as follows:

  
	
   

  
	
   

  	
  (a)

  	
  The Company or the Bank
  will pay CSC a cash fee equal to $20,000 payable upon the later of CSC’s
  receipt and delivery to the Company of a “no objection” notice from the Financial
  Industries Regulatory Authority (the “FINRA”) in connection with the Offering
  or the Commencement Date (which for purposes of this engagement letter shall
  be the date of the final prospectus made a part of the Registration Statement
  (such date referred to here as the “Commencement Date”)). On the first day of
  the first full month after the Commencement Date and for each month
  thereafter until the Offering is completed, the Company or the Bank will pay
  CSC the sum of $20,000 (due at the commencement of each month thereafter) for
  the term of CSC’s engagement hereunder.

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  If the Offering is
  successful (the Company raises at least the minimum, or subject to securities
  laws, and with the consent of the bank regulatory authorities such lesser
  amount as needed for the Bank to commence operations), the Company agrees to
  pay CSC at each closing (“Closing”) at which subscriptions for Common Shares
  are accepted by the Company and the subscription funds are released from
  escrow, a cash fee equal to (i) 2.0% of the gross proceeds from the
  Offering on the first $3,000,000 in subscriptions received from investors who
  are not introduced to the Company by CSC, (ii) 4% on all subsequent in
  subscriptions in excess of the initial $3,000,000 received from investors who
  are not introduced to the Company by CSC and (iii) 5.0% of the gross
  proceeds from subscriptions received from investors introduced to the Company
  by CSC (which investors shall be documented in writing prior to the Closing);
  provided, however, that the fee paid at the Closing will be reduced by the
  aggregate of the fees paid to CSC pursuant to paragraph 4(a) above. In
  addition, subscriptions from Mr. Bill Crosby, either individually or in
  the name of his company, Interstate Brokers, Inc., Mr. Stephen Anderson,
  Mr. Larry Silver (a founder) and those individuals who are the
  directors, officers, organizers or employees of the Company or the Bank as of
  the date of this EL will not be subject to the fee.

  
					

 

 

 

2

 

 

	
   

  	
  (c)

  	
  The Company agrees to
  reimburse the actual and accountable reasonable expenses of CSC in connection
  with its activities related to the Offering in accordance with this EL. These
  expenses will be presented to the Company at regular intervals. Attachment B,
  a part of this EL, defines the reimbursement policy to be followed. Without
  prior written consent of the Company, total expenses per month will not
  exceed $6,000 for the use of one on-site consultant and not more than an
  additional $3,000, or $9,000, in aggregate, for two on-site consultants.
  Notwithstanding any other provision of this EL, the Company will pay all
  reasonable third party expenses of CSC, including marketing and advertising,
  catering and facilities, printing and reproduction, and legal fees (which
  legal fees will be capped at $20,000, excluding blue sky registrations and
  FINRA Rule 2710 filings, if any).

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  If the Company elects
  to engage CSC as a Sponsoring Dealer, CSC will provide this service as part
  of the engagement at no additional charge.

  
	
   

  
	
   

  	
  5.

  	
  Regardless of whether
  the proposed Offering is consummated, the Company and the Bank agree to
  indemnify and hold harmless CSC and its controlling persons, representatives
  and agents in accordance with Attachment C, which is incorporated herein by
  this reference and made a part hereof.

  
	
   

  	
   

  	
   

  
	
   

  	
  6.

  	
  It is understood that
  the proceeds of the Offering will be used to pay for the pre-opening expenses
  of the Company and the Bank, support the future growth of the Bank and for
  general corporate purposes, all as disclosed by the Company in the
  Registration Statement.

  
	
   

  	
   

  	
   

  
	
   

  	
  7.

  	
  The Company, and its
  counsel, will attempt to qualify or register the Common Shares for sale under
  the securities laws of such states and other jurisdictions as may be reasonably
  necessary, in the mutually agreed opinion of the Company and CSC, provided
  that, the parties currently agree that qualification and registration will
  only be completed in North Carolina, South Carolina, Georgia and Florida.
  Prior to closing, the Company’s counsel shall provide CSC with evidence of
  compliance with the foregoing in the form of a blue sky memorandum. To the
  extent that CSC and its counsel assist in this process, the Company will pay
  the reasonable fees and expenses of CSC’s counsel in connection with such
  efforts, which shall be in addition to any cap set forth in paragraph
  4(c) above.

  
	
   

  	
   

  	
   

  
	
   

  	
  8.

  	
  The Registration
  Statement, the Subscription Agreement and every aspect of the Offering must
  be satisfactory in form and substance to the Company, CSC and their
  respective counsel. The Company will include in the Subscription Agreement
  such provisions as CSC may reasonably request in order to elicit from each
  investor information necessary to determine the suitability of an investment
  in the Company for such investor.

  
					

 

 

3

 

 

	
   

  	
  9.

  	
  If the Offering
  proceeds, the Company and CSC will enter into an Agency Agreement immediately
  prior to or following the initial distribution of the Registration Statement,
  or if the Offering has previously commenced any supplement to the
  Registration Statement disclosing the participation of CSC in the Offering.
  The Agency Agreement will contain, among other provisions customary in such
  agreements, provisions consistent with this letter and satisfactory to the
  parties, including the following:

  
	
   

  
	
   

  	
  (a)

  	
  representations and
  warranties, covenants and conditions, which are customary and appropriate for
  a registered or exempt, as applicable, offering of securities;

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  an agreement by the
  Company and the Bank to pay all expenses incident to the performance of its
  obligations under the agreement, including, among others, the SEC and FINRA
  filing fees (including fees related to the Agency Agreement), if any, the
  reasonable fees and expenses of the Company’s counsel, the reasonable fees
  and expenses of the independent public accountants for the Company, the cost
  of preparing, printing and filing the Registration Statement, the cost of
  furnishing reasonable quantities thereof to CSC, and to pay the out-of-pocket
  expenses of CSC as described in paragraph 4 above if the Offering is not
  completed; and

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  the agreement of the
  Company and the Bank to indemnify and hold harmless CSC and its controlling
  persons, representatives and agents from all expenses, losses, claims,
  actions, damages or liabilities incurred in connection with any claim made
  against the Company, the Bank or CSC, as the case may be, concerning any
  matters contemplated by this EL, including against liabilities based upon
  alleged misstatements in and alleged omissions from the Registration
  Statement, and appropriate provisions for contribution in the event this
  indemnity undertaking is found to be unenforceable in form and substance
  satisfactory to our attorneys; provided, however, that such indemnity will
  not exceed the scope of the indemnity set forth in Attachment C.

  
	
   

  
	
   

  	
  10.

  	
  The Company
  acknowledges and agrees that the Offering is a sophisticated enterprise and
  that CSC has been engaged solely with respect to the matters set forth
  herein. In such capacity, CSC shall act as an independent contractor and
  CSC’s duties hereunder are contractual and shall be owed solely to the
  Company. Each party disclaims any intention to impose a fiduciary duty on the
  other.

  
	
   

  	
   

  	
   

  
	
   

  	
  11.

  	
  This EL shall terminate
  automatically without any action of the parties hereto upon the expiration
  date of the Offering, unless extended by the mutual consent of the Company
  and CSC. This EL may be terminated by either the Company or CSC upon 30 days
  written notice to the other party. In the event this EL terminates as
  provided in this paragraph 11, the Company shall promptly reimburse all
  outstanding actual and accountable expenses of CSC as provided in paragraph
  4(c).

  
							

 

 

4

 

 

	
   

  	
  12.

  	
  This EL shall be
  governed by and construed in accordance with the laws of the State of Texas,
  without regard to the conflicts of law provisions thereof.

  
	
   

  	
   

  	
   

  
	
   

  	
  13.

  	
  This EL shall not be
  assigned by either party without the other party’s prior consent, which
  consent shall not be unreasonably withheld. Notwithstanding the foregoing,
  CSC may assign this EL to a successor in interest, by way of merger or the
  sale of substantially all of its assets, or to any entity which is under the
  common control of the members of CSC.

  

 

The
purpose of this EL is to set forth the terms of the proposed engagement of CSC
as mutually understood and, except for the agreement as to the payment of fees
and expenses and indemnification contained in paragraphs 4 and 5 above,
respectively, is not to be construed as a binding contract or commitment on the
part of any party hereto.  It is
understood that the proposed Offering is subject to satisfactory investigation
on our part of the activities of the Company and the Bank and the absence of
any material adverse change in the condition (financial or other), earnings,
business, prospects, net worth or results of operations of the Company or the
Bank or in the overall capital markets. 
You will give CSC and its counsel full access to the records of the
Company and the Bank (to the extent permitted by law) for the purpose of
completing our investigation, and will keep us apprised of all material
developments affecting the Company or the Bank.

 

 

5

 

 

If
this EL sets forth correctly the understanding of the Company, please sign and
return to us one copy of this letter.

 

We are looking forward to
working on the Offering with you.

 

Sincerely,

 

	
  Commerce
  Street Capital, LLC

  
	
   

  
	
  By:

  	
  /s/ Charles W. Ingram

  	
   

  
	
  Name:

  	
  Charles W. Ingram

  
	
  Title:

  	
  Senior Vice President

  
	
   

  
	
  Accepted and Agreed to:

  
	
   

  
	
  Coastal
  Carolina Bancshares, Inc. /

  
	
  Coastal
  Carolina National Bank (In Organization

  
	
   

  
	
  By:

  	
  /s/ Holly L. Schreiber

  	
   

  
	
   

  	
  Holly L. Schreiber

  
	
   

  	
  Chief Financial Officer

  
	
   

  
	
  Date:

  	
   August 8, 2008

  	
   

  
	
   

  	
   

  
								

 

 

 

 

 

 

 

6

 

 

ATTACHMENT
A

 

 

Management/Director/Organizer
Responsibilities

 

 

Time
Period - 30 days prior to CSC’s Commencement Date:

 

Organizer/Director/Management
Responsibilities:

 

1.  Provide a list of names (minimum desired is
100 from each organizer/director/manager) of prospective investors.  All investors included on such list will be
persons for whom the organizer/director/manager reasonably believes an
investment in the Company is suitable based on such person’s financial and tax
status, investment objectives and investment experience.   The list shall include proper addresses,
phone numbers and, if available, email addresses.  Any useful background (retired, sold company,
etc.) regarding potential investors is very helpful.

 

2.  Prepare all collateral material, including,
folders, stationery, postage reply envelopes, advertisements and tombstones (if
appropriate) and a website (if appropriate).

 

Time
Period - Following the Commencement Date:

 

Organizer/Director
Responsibilities

 

1.  Participate in the process.

2.  Be proactive in arranging one-on-one and
group meetings.

3.  Encourage people to attend lunch and dinner
functions.

4.  Promptly return phone calls from the CSC
onsite consultant.

5.  Complete funding investment in transaction
promptly when asked.

6.  Collectively invest at least 10% of the
minimum amount.

 

Management
Responsibilities:

 

1.  Same tasks as organizers/directors under 1-5
above.

2.  Support CSC on a day-to-day basis.

3.  Be present at the Company office every
business day.

4.  Prepare and deliver presentations.

5.  Actively call and work prospects/contacts.

 

 

7

 

 

ATTACHMENT B

 

MEALS

 

Up to $250 per week per  person with receipts attached to expense
reports.

 

MILEAGE/AIRFARE

 

$.585 per mile on direct
business related travel with personal cars. All mileage is to be logged on a
daily basis on expense reports. When traveling by air, the lower of coach or economy
fares, if available, will be used.

 

LODGING

 

The lowest cost
alternative to the Company will be used commensurate with safety and
cleanliness for personnel.

 

 

 

 

 

 

 

8

 

 

ATTACHMENT
C

 

Coastal Carolina Bancshares, Inc.,
Coastal Carolina Dream Team, LLC and Coastal Carolina National Bank (collectively,
the “Company”) agree to indemnify and hold harmless CSC and each person, if any, who controls CSC within
the meaning of Section 15 of the Securities Act of 1933, as amended, or Section 20
of the Securities Exchange Act of 1934, as amended, and their respective
members, partners, directors, officers, employees, agents and controlling
persons (CSC and each such person being an “Indemnified Party”) from and against
any and all loss, claim, damage, judgment, assessment, cost and other liability
(each a “Claim”), joint or several, to which such Indemnified Party may become
subject under any applicable federal or state law, or otherwise, and related to
or arising out of any transaction contemplated by this EL or the engagement of
CSC pursuant to, and the performance by CSC of the services contemplated by
this EL and will reimburse any Indemnified Party for all reasonable fees and
expenses (including reasonable counsel fees and expenses) as they are incurred
in connection with the investigation of, preparation for, or defense of any
pending or threatened claim or any action or proceeding arising therefrom,
whether or not such Indemnified Party is a party and whether or not such claim,
action or proceeding is initiated or brought by or on behalf of the Company.
The Company will not be liable under the foregoing indemnification and
reimbursement provisions to the extent that any loss, claim, damage, judgment,
assessment, cost or any other liability, or related expense, is found in a
final judgment by a court of competent jurisdiction to have resulted from an
Indemnified Party’s willful misconduct, bad faith or gross negligence or the
breach of this EL.  The Company also agrees
that no Indemnified Party will have any liability (whether direct or indirect,
in contract or tort or otherwise) to the Company or its security holders or
creditors related to or arising out of the engagement of CSC pursuant to, or
the performance by CSC of the services contemplated by, this Agreement except
to the extent that any loss, claim, damage, judgment, assessment, cost or any
other liability, or related expenses, is found in a final judgment by a court
of competent jurisdiction to have resulted from an Indemnified Party’s willful
misconduct, bad faith or gross negligence or the breach of this Agreement.

 

If the indemnification of an Indemnified Party provided for in this EL
is for any reason held unenforceable (other than for a reason provided in the
prior paragraph), the Company agrees to contribute to the losses, claims,
damages, judgments, assessments, costs and other liabilities, and related
expenses, for which such indemnification is held unenforceable (i) in such
proportion as is appropriate to reflect the relative benefits to the Company
and its security holders, on the one hand, and CSC, on the other hand, of the
transaction as contemplated (whether or not the transaction is consummated) or (ii) if
(but only if) the allocation provided for in clause (i) is for any
reason held unenforceable, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) but also the
relative fault of the Company, on the one hand, and CSC, on the other hand, as
well as any other relevant equitable considerations; provided, however, that,
to the extent permitted by applicable law, in no event will the Indemnified
Parties be required to contribute an aggregate amount in excess of the
aggregate fees actually paid to CSC under this Agreement.

 

The Company agrees that, without CSC’s prior written consent, which
consent will not be unreasonably withheld, it will not settle, compromise or
consent to the entry of any judgment in any pending or threatened claim,
action, or proceeding in respect of which indemnification could be sought under
the indemnification provisions of this EL, whether or not CSC or any other 

 

 

9

 

 

Indemnified Party is
an actual or threatened party to such claim, action, or proceeding, unless such
settlement, compromise or consent includes an unconditional release of each
Indemnified Party from all liability arising out of such claim, action or
proceeding.  The Company shall not be
liable for any settlement of any litigation or proceeding effected without its
consent.

 

Upon receipt by an Indemnified Party of actual notice
of a Claim as to which indemnification may be sought hereunder, such
Indemnified Party shall promptly notify the Company of the nature and basis of
the Claim.  In addition, an Indemnified
Party shall promptly notify the Company after any action is commenced against
the Indemnified Party (by way of service with a summons or other legal process)
and shall transmit a copy to the business address of the Company.  The Company may, and shall, if requested by
any Indemnified Party, assume the defense of any Claim against such Indemnified
Party in respect of which indemnity may be sought hereunder, including, without
limitation, the employment of counsel reasonably satisfactory to such
Indemnified Party and the payment of the fees and expenses of such counsel and
necessary experts, in which event the Company shall not be liable for the fees
and expenses of any other counsel retained by such Indemnified Party in
connection with such litigation or proceeding.

 

The reimbursement, indemnity and contribution obligations of the
Company under the preceding paragraphs shall be in addition to any liability
that the Company may otherwise have, and shall be binding upon and inure to the
benefit of the successors, assigns, heirs and personal representatives of any
Indemnified Party.

 

In the event that an Indemnified Party is requested or
required to appear as a witness in any action brought by or on behalf of or
against the Company or any affiliate of the Company in a transaction
contemplated by this EL in which such Indemnified Party is not named as a
defendant, the Company agrees to reimburse CSC for all reasonable expenses
incurred by it in connection with such Indemnified Party’s appearing and
preparing to appear as such a witness, including, without limitation, the
reasonable fees and disbursements of its legal counsel.

 

 

 

 

 

 

 

10

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