This Stock
Purchase Agreement (this “ Agreement ”) is made
as of September 13, 2006 by and between First Acceptance
Corporation, a Delaware corporation (the “ Company
”), and Edward Pierce (“ Executive
”).
WHEREAS, the
Company wishes to sell to Executive, and Executive desires to
purchase from the Company, shares of its common stock, par value
$0.01 per share (“ Common Stock ”), pursuant to
the terms and conditions set forth below.
NOW, THEREFORE, in
consideration of the premises and the representations, warranties
and agreements herein contained and intending to be legally bound
hereby, the Company and Executive hereby agree as
follows:
ARTICLE I
DELIVERY OF COMMON STOCK AND RELATED MATTERS
Section 1.1 Purchase of Common Stock . The
Company shall authorize and issue to Executive and, subject to the
terms and conditions set forth herein, Executive shall accept from
the Company, an aggregate of 50,000 shares of Common Stock (the
“ Shares ”) in consideration for a cash payment
of $590,500. Upon execution of this Agreement, (i) the Company
will instruct its transfer agent to issue the Shares to Executive
as promptly as practicable; and (ii) Executive shall make its
payment in respect of such Shares by wire transfer of immediately
available funds to the account(s) specified in writing by the
Company to Executive.
Section 1.2 Restricted Securities . Executive
understands that the Shares are being issued only in a transaction
not involving any public offering in the United States within the
meaning of the Securities Act of 1933, as amended (the “
Securities Act ”), the Shares have not been registered
under the Securities Act or any other applicable securities law,
that the Shares will be “restricted securities” within
the meaning of Rule 144 under the Securities Act and that
(A) prior to the expiration of the holding period applicable
to sales of restricted securities pursuant to Rule 144 under
the Securities Act, the Shares may be offered, resold, pledged or
otherwise transferred only in accordance with any applicable
securities laws of any state of the United States or any other
applicable jurisdiction (i) (a) in a transaction meeting the
requirements of Rule 144 under the Securities Act,
(b) outside the U.S. to a foreign purchaser in a transaction
meeting the requirements of Regulation S or (c) pursuant
to a transaction that is otherwise exempt from the registration
requirements of the Securities Act and state securities laws,
(ii) to the Company or (iii) pursuant to an effective
registration statement under the Securities Act and
(B) Executive will notify any subsequent purchaser from it of
the resale restrictions set forth in (A) above, if then
applicable. Executive agrees that the certificates representing the
Shares shall bear a restrictive legend in substantially the
following form:
“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ACQUIRED IN A
TRANSACTION THAT WAS NOT REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE, AND
MAY NOT BE SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE
STATE SECURITIES LAWS OR AN
APPLICABLE
EXEMPTION THEREFROM TO THE REGISTRATION REQUIREMENTS OF SUCH ACT OR
LAWS.”
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company
represents and warrants to Executive as follows:
Section 2.1 Organization and Standing of the
Company . The Company is a corporation duly organized, validly
existing and in good standing under the laws of its state of
incorpo
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