EXHIBIT 10.12
REVOLVING NOTE
$75,000
As of August 3, 2004
Houston, Texas
Coastal
Bancshares Acquisition
Corp., a Delaware corporation (the "Maker")
promises to pay to the order of
Coastal Acquisition, LLC (the "Payee") the
principal sum of Seventy Five Thousand Dollars($75,000) lawful money of the
United States of America or such lesser
amount as may have been advanced and be
outstanding hereunder, on the terms and
conditions described below.
1. Principal. The principal balance of this Note shall be
repayable on the
later of (i)
October 31, 2004 or
(ii) the date on which Maker consummates
an initial
public offering of its securities.
2. Interest. No interest shall accrue on the
unpaid principal balance of this
Note.
3. Advancement of Funding. Maker shall have the right to
request from Payee
advances
under this Note and
Payee shall make advances under this Note, up
to an
aggregate amount funded at any time of Seventy
Five Thousand and
No/100 Dollars
($75,000.00).
4. Application of Payments.
All payments shall be
applied first to payment in
full of any
costs incurred
in the collection of any sum due under this
Note,
including (without
limitation) reasonable
attorneys' fees, then
to
the payment in
full of any late charges and finally to the reduction of the
unpaid principal
balance of this Note.
5. Events of Default. The
following shall constitute Events of Default:
(a) Failure to Make Required Payments. Failure by Maker to pay the
principal of or accrued interest on this Note within five (5)
business
days following the date when due.
(b) Voluntary Bankruptcy, Etc. The commencement by Maker of a
voluntary
case under
the Federal Bankruptcy Code, as now constituted or
hereafter
amended, or
any other applicable federal or state
bankruptcy,
insolvency,
reorganization,
rehabilitation or
other
similar law,
or the consent by it to the appointment of or taking
possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator (or
other similar official) of Maker or for any
substantial part
of its property, or the making by it of any
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assignment for the
benefit of creditors, or the failure of Maker
generally to pay its
debts as such debts become due, or the taking of
corporate action by Maker in furtherance of any of the
foregoing.
(c) Involuntary Bankruptcy, Etc. The
entry of a decree or order for relief
by a court having
jurisdiction in the premises in respect of maker in
an involuntary
case under the
Federal Bankruptcy Code, as now or
hereafter constituted,
or any other applicable federal or state
bankruptcy, insolvency or other similar law, or appointing a
receiver,
liquidator, assignee,
custodian,
trustee, sequestrator (or similar
official) of Maker or for any substantial part of its property, or
ordering
the winding-up or liquidation of its affairs, and the
continuance of any
such decree or order
unstayed and in effect for a
period of 60 consecutive days.
6. Remedies.
(a) Upon the occurren
