Exhibit 10.1
PARTNERS’ EQUITY AGREEMENT
Dated as of
February 7, 2006
 
By and Between
THOMAS WEISEL PARTNERS GROUP, INC.
and
THE PARTNERS

 

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                      Page
 
  ARTICLE I        
 
           
 
  RESTRICTIONS ON TRANSFER        
 
           
Section 1.01
  General Restrictions on Transfer     2  
Section 1.02
  Legends     2  
Section 1.03
  Permitted Transferees     2  
Section 1.04
  Restrictions on Transfers by Shareholders     3  
 
           
 
  ARTICLE II        
 
           
 
  REGISTRATION RIGHTS        
 
           
Section 2.01
  Demand Registration     4  
Section 2.02
  Piggyback Registration     7  
Section 2.03
  Lock-Up Agreements     8  
Section 2.04
  Registration Procedures     8  
Section 2.05
  Indemnification by the Company     12  
Section 2.06
  Indemnification by Participating Shareholders     12  
Section 2.07
  Conduct of Indemnification Proceedings     13  
Section 2.08
  Contribution     14  
Section 2.09
  Participation in Public Offering     15  
Section 2.10
  Other Indemnification     15  
Section 2.11
  Cooperation by the Company     15  
Section 2.12
  No Transfer of Registration Rights     15  
Section 2.13
  Underwritten Offering Committee     15  
Section 2.14
  Term of Registration Rights     16  
Section 2.15
  Other Agreements     16  
 
           
 
  ARTICLE III        
 
           
 
  SHAREHOLDER COVENANTS        
 
           
Section 3.01
  Confidential Information     16  
Section 3.02
  Noncompetition     17  
Section 3.03
  Nonsolicitation of Clients     18  
Section 3.04
  Nonsolicitation of Employees     18  
Section 3.05
  Transfer of Client Relationships     18  
Section 3.06
  Prior Notice Required     19  
Section 3.07
  Shareholder Covenants Generally     19  
Section 3.08
  Damages     19  
Section 3.09
  Arbitration     20  
Section 3.10
  Compensation     20  

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                      Page
 
  ARTICLE IV        
 
           
 
  MISCELLANEOUS        
 
           
Section 4.01
  Binding Effect; Assignability; Benefit     21  
Section 4.02
  Notices     21  
Section 4.03
  Waiver; Amendment; Termination     22  
Section 4.04
  Fees and Expenses     22  
Section 4.05
  Governing Law     22  
Section 4.06
  Jurisdiction     22  
Section 4.07
  WAIVER OF JURY TRIAL     23  
Section 4.08
  Specific Enforcement     23  
Section 4.09
  Counterparts; Effectiveness     23  
Section 4.10
  Entire Agreement     23  
Section 4.11
  Captions     23  
Section 4.12
  Severability     23  
 
           
 
  ARTICLE V        
 
           
 
  DEFINITIONS        
 
           
Section 5.01
  Definitions     24    
Exhibit A:
  Joinder Agreement to Partners’ Equity Agreement        

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PARTNERS’ EQUITY AGREEMENT
          This PARTNERS’ EQUITY AGREEMENT (this “Agreement”), dated as of
February 7, 2006, is entered into by and between Thomas Weisel Partners Group,
Inc., a Delaware corporation (the “Company”) and the individuals listed on the
signature page hereof (each, a “Shareholder”). “Shareholder” shall mean, if such
person shall have “Transferred” any of his or her “Company Securities” to any of
his or her respective “Permitted Transferees” (as such terms are defined below),
such person and such Permitted Transferees, taken together, and any right,
obligation or action that may be exercised or taken at the election of such
person may be taken at the election of such person and such Permitted
Transferees. Capitalized terms used have the meanings set forth in Article V.
W I T N E S S E T H:
          WHEREAS, pursuant to the Plan of Reorganization and Merger Agreement
(the “Reorganization Agreement”), dated as of October 14, 2005, by and among the
Company, Thomas Weisel Partners Group LLC (“TWPG LLC”) and TWPG Merger Sub LLC,
the Company has agreed to succeed to the businesses of TWPG LLC through
reorganization transactions (the “Reorganization”) involving, among others, the
merger of TWPG Merger Sub LLC with and into TWPG LLC;
          WHEREAS, In connection with the Reorganization, the Shareholders will
exchange his or her interests in TWPG LLC for Common Shares (as defined below);
          WHEREAS, the parties hereto acknowledge that each Shareholder, as a
result of his or her relationship with TWPG LLC, has obtained knowledge of the
Confidential Information (as defined below), and that the Company’s future
businesses rely, to a significant extent, upon such Confidential Information and
the goodwill of TWPG LLC in general;
          WHEREAS, the parties hereto acknowledge that, following consummation
of the Reorganization, as provided in and subject to the terms and conditions of
this Agreement, the Shareholders may sell or dispose of certain of his or her
Company Securities (as defined below), and receive substantial benefits as a
result of the Reorganization.
          WHEREAS, the parties hereto desire to enter into this Agreement to
govern certain of their rights, duties and obligations after consummation of the
Reorganization;
          NOW, THEREFORE, in consideration of the covenants and agreements
contained herein and in the Reorganization Agreement, the parties hereto agree
as follows:

 

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ARTICLE I
RESTRICTIONS ON TRANSFER
          Section 1.01 General Restrictions on Transfer. (a) Each Shareholder
understands and agrees that the Company Securities received by him or her
pursuant to the Reorganization Agreement have not been registered under the
Securities Act and are restricted securities under the Securities Act and the
rules and regulations promulgated thereunder. Each Shareholder agrees that he or
she shall not Transfer any Company Securities (or solicit any offers in respect
of any Transfer of any Company Securities), except in compliance with the
Securities Act, any other applicable securities or “blue sky” laws, and the
terms and conditions of this Agreement.
               (a) Any attempt to Transfer any Company Securities otherwise than
in compliance with this Agreement shall be null and void, and the Company shall
not, and shall cause any transfer agent not to, give any effect in the Company’s
stock records to such attempted Transfer.
          Section 1.02 Legends. (a) In addition to any other legend that may be
required under the Reorganization Agreement or otherwise, each certificate for
Company Securities issued to the Shareholders shall bear a legend in
substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY FOREIGN OR STATE SECURITIES LAWS AND MAY NOT BE OFFERED OR SOLD
EXCEPT IN COMPLIANCE THEREWITH. THIS SECURITY IS ALSO SUBJECT TO ADDITIONAL
RESTRICTIONS ON TRANSFER AS SET FORTH IN THE PARTNERS’ EQUITY AGREEMENT, DATED
AS OF FEBRUARY ___, 2006, COPIES OF WHICH MAY BE OBTAINED UPON REQUEST FROM
THOMAS WEISEL PARTNERS GROUP, INC. OR ANY SUCCESSOR THERETO.
               (b) If any Company Securities shall cease to be Registrable
Securities under clause (i) or clause (ii) of the definition thereof, the
Company, upon the written request of the holder thereof, shall issue to such
holder a new certificate evidencing such Company Securities without the first
sentence of the legend required by Section 1.02(a) endorsed thereon. If any
Company Securities cease to be subject to any and all restrictions on Transfer
set forth in this Agreement, the Company, upon the written request of the holder
thereof, shall issue, or cause to be issued, to such holder a new certificate
evidencing such Company Securities without the second sentence of the legend
required by Section 1.02(a) endorsed thereon.
          Section 1.03 Permitted Transferees. Notwithstanding anything to the
contrary in this Agreement, a Shareholder may at any time Transfer any or all of
his or

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her Company Securities to one or more of his or her Permitted Transferees
without the consent of the Company so long as (a) such Permitted Transferee has
agreed in writing to be bound by the terms of this Agreement pursuant to a
Joinder Agreement in the form of Exhibit A attached hereto, and (b) the Transfer
to such Permitted Transferee is in compliance with the Securities Act and any
other applicable securities or “blue sky” laws.
          Section 1.04 Restrictions on Transfers by Shareholders. (a) Subject to
Sections 1.04(b), 1.04(c) and 1.04(d), a Shareholder shall not Transfer any of
his or her Company Securities until after the fifth anniversary of the Closing
Date, except to one or more of his or her Permitted Transferees in accordance
with Section 1.03; provided that, to the extent that at the time of any proposed
Transfer, in the reasonable judgment of the Underwritten Offering Committee, the
Shareholder continues to be actively engaged in the businesses of the Firm, his
or her Company Securities may be released from the restrictions on Transfers set
forth in this Section 1.04(a) to permit that:
               (i) up to one-third of the Company Securities of such Shareholder
may be Transferred at any time after the third anniversary of the Closing Date
(it being understood that, for purposes of this clause, any Company Securities
Transferred by such Shareholder pursuant to Section 1.04(b)(i) on or prior to
the third anniversary shall be included in calculating the one-third permitted
to be Transferred hereunder); and
               (ii) up to an additional one-third of the Company Securities of
such Shareholder may be Transferred at any time after the fourth anniversary of
the Closing Date (it being understood that, for purposes of this clause, any
Company Securities Transferred by such Shareholder pursuant to
Section 1.04(b)(i) after the third anniversary but on or prior to the fourth
anniversary shall be included in calculating the additional one-third permitted
to be Transferred hereunder).
          (b) Notwithstanding the provisions of Section 1.04(a), a Shareholder
may Transfer any of his or her Company Securities as follows:
               (i) in a Public Offering in connection with the exercise of his
or her rights under Article II subject to the limitations set forth therein;
               (ii) following the termination of the employment of such
Shareholder by the Company due to the Shareholder’s death or disability, in a
Transfer that meets all of the requirements of Rule 144; or
               (iii) subject to the approval of the Underwritten Offering
Committee, in a Transfer with or without consideration of any kind (A) to a
spouse, lineal descendant, sibling or parent of the Shareholder (each, a “Family
Member”), (B) a trust that is for the exclusive benefit of such Shareholder
and/or one or more Family Members and/or any institution qualified as tax exempt
under Section 501(c)(3) of the Code (“Charitable Organization”) or (C) any

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Charitable Organization; provided, however, that in each case any such
transferee shall have agreed in writing to be bound by the terms of this
Agreement pursuant to a Joinder Agreement in the form of Exhibit A attached
hereto, and such Transfer is in compliance with the Securities Act and any other
applicable securities or “blue sky” laws).
              (c) The restrictions on Transfers set forth in Section 1.04(a)
shall not terminate with respect to any Company Securities that have been
pledged to the Company as security in connection with the Shareholder Covenants
until such time as the Shareholder Covenants shall have expired.
              (d) The restrictions on Transfers set forth in Section 1.04(a)
shall terminate automatically upon a Change of Control.
ARTICLE II
REGISTRATION RIGHTS
          Section 2.01 Demand Registration. (a) The Company shall give prompt
notice to each Shareholder (so long as such Shareholder is an Eligible
Shareholder) of each Window Period, which notice shall specify the Maximum Share
Number. If at any time during a Window Period or at any time following the fifth
anniversary of the Closing Date, the Company shall receive a request from the
Shareholder (the “Requesting Shareholder”) that the Company effect the
registration under the Securities Act of all or any portion of such Requesting
Shareholder’s Registrable Securities, and specifying the intended method of
disposition thereof, then the Company shall promptly give notice of such
requested registration (each such request shall be referred to herein as a
“Demand Registration”) to the Other Shareholders. The Company shall use its
commercially reasonable efforts to effect, subject to the provisions of
Section 2.01(f), the registration under the Securities Act of the Registrable
Securities for which the Requesting Shareholders have requested registration
under this Section 2.01 and all other Registrable Securities of the same class
as those requested to be registered by the Requesting Shareholders that any
Other Shareholders with rights to request registration under Section 2.02 (all
such Other Shareholders, together with the Requesting Shareholders, the
“Registering Shareholders”) have requested the Company to register by request
received by the Company within five (5) Business Days after such Other
Shareholders receive the Company’s notice of the Demand Registration, all to the
extent necessary to permit the disposition (in accordance with the intended
methods thereof as aforesaid) of the Registrable Securities so to be registered,
provided that,
               (i) subject to Section 2.01(d), the Company shall not be
obligated to effect more than two Demand Registrations in any twelve-month
period,
               (ii) the Company shall not be obligated to effect a Demand
Registration unless the aggregate number of shares of the Registrable

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Securities requested to be included in such Demand Registration equals or
exceeds 5% of the Common Shares outstanding at the time the request for the
Demand Registration is made,
               (iii) the Company shall not be obligated to include in such
registration a number of Registrable Securities of the Shareholder which exceeds
such Shareholder’s Pro Rata Portion (unless any Other Shareholder who is an
Eligible Shareholder shall choose not to participate in such registration up to
the full amount of such Other Shareholder’s Pro Rata Portion, in which case each
Registering Shareholder may choose to increase the number of Registrable
Securities to be included in such registration by his or her Pro Rata Portion of
the Shortfall subject to the provisions of Section 2.01(e)),
               (iv) the Company shall not be required to effect the registration
of Registrable Securities in excess of the Maximum Share Number (the limitations
in clauses (ii), (iii) and (iv) of this Section 2.01(a), collectively, the
“Public Offering Limitations”),
               (v) in no event shall the Company be required to effect a Demand
Registration from any Requesting Shareholder unless such Requesting Shareholder
at the time the request is made (x) continues to be actively engaged in the
businesses of the Firm (in the reasonable judgment of the Underwritten Offering
Committee), (y) has suffered a termination of employment by the Firm resulting
from a disability or (z) is a Permitted Transferee (a Shareholder who fulfills
the criteria in clauses (x)-(z) of this Section 2.01(a)(v), an “Eligible
Shareholder”), and
               (vi) The Company shall not be required to effect a Demand
Registration within 180 days of a Piggyback Registration effected pursuant to
Section 2.02.
               (b) Promptly after the expiration of the five (5) Business-Day
period referred to in Section 2.01(a), the Company will notify all Registering
Shareholders of the identities of the other Registering Shareholders and the
number of shares of Registrable Securities requested to be included therein. At
any time prior to the effective date of the registration statement relating to
such registration, the Requesting Shareholder may revoke such request, without
liability to any of the other Registering Shareholders, by providing a notice to
the Company revoking such request. A request, so revoked, shall be considered to
be a Demand Registration unless (i) such revocation arose out of the fault of
the Company (in which case the Company shall be obligated to pay all
Registration Expenses in connection with such revoked request) or (ii) the
Requesting Shareholder reimburses the Company for all Registration Expenses in
connection with such revoked request.

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               (c) The Company shall be liable for and pay all Registration
Expenses in connection with any Demand Registration, regardless of whether such
Registration is effected, except as set forth in Section 2.01(b).
               (d) A Demand Registration shall not be deemed to have occurred:
               (i) unless the registration statement relating thereto has become
effective under the Securities Act; provided that such registration statement
shall not be considered a Demand Registration if, after such registration
statement becomes effective, such registration statement is interfered with by
any stop order, injunction or other order or requirement of the SEC or other
governmental agency or court; or
               (ii) if the Maximum Offering Size is reduced in accordance with
Section 2.01(e) such that less than 66 2/3% of the Registrable Securities of the
Registering Shareholders sought to be included in such registration are
included.
               (e) If a Demand Registration involves an underwritten Public
Offering and the managing underwriter advises the Company and the Registering
Shareholders that, in its view, the number of shares of Registrable Securities
requested to be included in such registration (including any securities that the
Company proposes to be included or are otherwise contractually required to be
included that are not Registrable Securities under this Agreement) exceeds the
largest number of shares that can be sold without having an adverse effect on
such offering, including the price at which such shares can be sold (the
“Maximum Offering Size”), the Company shall include in such registration, in the
priority listed below, up to the Maximum Offering Size:
               (i) first, so much of the Company Securities proposed to be
registered for the account of the Company as would not cause the offering to
exceed the Maximum Offering Size,
               (ii) second, all Registrable Securities requested to be included
in such registration by the Registering Shareholders who are Eligible
Shareholders and all Company Securities contractually required to be registered
for the account of any other Persons (allocated, if necessary for the offering
not to exceed the Maximum Offering Size, pro rata among such Holders and such
other Persons on the basis of the relative number of Registrable Securities or
such other Company Securities so requested to be included in such registration
by each such Registering Shareholder and such other Person), and
               (iii) third, any Company Securities proposed, but not
contractually required, to be registered for the account of any other Persons
with such priorities among them as the Company may determine.

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               (f) Upon notice to each Requesting Shareholder, the Company may
defer the filing of a registration statement pursuant to this Section 2.01 for a
reasonable period of time not exceeding 90 days if (i) at the time the Company
receives the request for such Demand Registration, there is (A) material
non-public information regarding the Company which, in the judgment of the
Board, is not in the Company’s best interest to disclose and which the Company
is not otherwise required to disclose or (B) there is a significant business
opportunity (including, but not limited to, the acquisition or disposition of
assets (other than in the ordinary course of business) or any merger,
consolidation, tender offer or other similar transaction) available to the
Company which, in the judgment of the Board, is not in the Company’s best
interest to disclose; or (ii) prior to receiving the request for such Demand
Registration, the Company has determined to effect an offering in connection
with which equity securities of the Company are sold to an underwriter or
underwriters for reoffering to the public pursuant to an effective registration
statement under the Securities Act, and the Company has determined to proceed
with such offering.
          Section 2.02 Piggyback Registration. (a) If the Company proposes to
register any of the equity securities issued by it under the Securities Act
(other than a registration relating to Common Shares issuable upon exercise of
employee stock options or in connection with any employee benefit or similar
plan of the Company or in connection with a direct or indirect acquisition by
the Company of another Person on Form S-8 or S-4, or any successor or similar
forms), whether or not for sale for its own account, the Company shall each such
time give notice at least ten (10) Business Days prior to the anticipated filing
date of the registration statement relating to such registration to each
Shareholder (so long as such Shareholder is then an Eligible Shareholder), which
notice shall set forth such Shareholder’s rights under this Section 2.02 and
shall offer such Shareholder the opportunity to include in such registration
statement the number of Registrable Securities of the same class or series as
those proposed to be registered as such Shareholder may request (a “Piggyback
Registration”), subject to the provisions of Section 2.02(b) and the Public
Offering Limitations. Upon the request of such Shareholder (if such Shareholder
is then an Eligible Shareholder) made within five (5) Business Days after the
receipt of notice from the Company (which request shall specify the number of
Registrable Securities intended to be registered by such Shareholder), the
Company shall use its commercially reasonable efforts to effect the registration
under the Securities Act of all Registrable Securities that the Company has been
so requested to register by all such other Shareholders, to the extent necessary
to permit the disposition of the Registrable Securities so to be registered,
provided that (i) if such registration involves an underwritten public offering,
all such Shareholders requesting to be included in the Company’s registration
must sell their Registrable Securities to the underwriters selected by the
Company on the same terms and conditions as apply to the Company or the
Requesting Shareholders, as applicable, and (ii) if, at any time after giving
notice of its intention to register any Company Securities pursuant to this
Section 2.02(a) and prior to the effective date of the registration statement
filed in connection with such registration, the Company shall determine for any
reason not to register such securities, the Company shall give notice to

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all such Shareholders and, thereupon, shall be relieved of its obligation to
register any Registrable Securities in connection with such registration. No
registration effected under this Section 2.02 shall relieve the Company of its
obligations to effect a Demand Registration to the extent required by
Section 3.01. The Company shall pay all Registration Expenses in connection with
each Piggyback Registration.
          (b) If a Piggyback Registration involves an underwritten Public
Offering (other than any Demand Registration, in which case the provisions with
respect to priority of inclusion in such offering set forth in Section 2.01(e)
shall apply) and the managing underwriter advises the Company that, in its view,
the number of Shares that the Company and such Shareholders intend to include in
such registration exceeds the Maximum Offering Size, the Company shall include
in such registration, in the following priority, up to the Maximum Offering
Size:
     (i) first, so much of the Company Securities proposed to be registered for
the account of the Company as would not cause the offering to exceed the Maximum
Offering Size, and
     (ii) second, all Registrable Securities requested to be included in such
registration by any Shareholders who are Eligible Shareholders pursuant to
Section 2.02 and all securities contractually required to be registered for the
account of any other Persons (allocated, if necessary for the offering not to
exceed the Maximum Offering Size, pro rata among such Shareholders and such
other Persons on the basis of the relative number of Registrable Securities or
such other Company Securities so requested to be included in such registration
by each such Shareholder and such other Person), and
     (iii) third, any Company Securities proposed, but not contractually
required, to be registered for the account of any other Persons with such
priorities among them as the Company shall determine.
     Section 2.03 Lock-Up Agreements. If any registration of Registrable
Securities shall be effected in connection with a Public Offering, each
Shareholder shall not offer to sell, contract to sell, or otherwise sell,
dispose of, loan, pledge or grant any rights with respect to any Common Shares,
any options or warrants to purchase any Common Shares, or any securities
convertible into or exchangeable for any Common Shares now owned or hereafter
acquired directly by such Shareholder or with respect to which such Shareholder
has or hereafter acquires the power of disposition (except as part of such
Public Offering) during the period beginning on the effective date of the
applicable registration statement until the earlier of (i) such time as the
Company and the managing underwriter shall agree and (ii) 215 days (such period,
the “Lock-Up Period” for the applicable registration statement).
     Section 2.04 Registration Procedures. Whenever a Shareholder requests that
any Registrable Securities be registered pursuant to Section 2.01 or 2.02,
subject to the provisions of such Sections, the Company shall use its
commercially

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reasonable efforts to effect the registration and the sale of such Registrable
Securities in accordance with the intended method of disposition thereof as
quickly as practicable and, in connection with any such request:
          (a) The Company shall prepare and file with the SEC a registration
statement on any form for which the Company then qualifies or that counsel for
the Company shall deem appropriate and which form shall be available for the
sale of the Registrable Securities to be registered thereunder in accordance
with the intended method of distribution thereof, and use its commercially
reasonable efforts to cause such filed registration statement to become and
remain effective for a period of not less than 180 days (or such shorter period
in which all of the Registrable Securities of the Registering Shareholders
included in such registration statement shall have actually been sold
thereunder).
          (b) Prior to filing a registration statement or prospectus or any
amendment or supplement thereto, the Company shall, if requested, furnish to
each participating Shareholder and each underwriter, if any, of the Registrable
Securities covered by such registration statement copies of such registration
statement as proposed to be filed, and thereafter, to the extent such documents
are not publicly available on the SEC’s EDGAR website, the Company shall furnish
to such Shareholder and each underwriter, without charge, at least one conformed
copy of each registration statement and each amendment thereto, including
financial statements and schedules, all documents incorporated or deemed to be
incorporated therein by reference, and all exhibits to the extent requested by
such Shareholder (including those previously furnished or incorporated by
reference) promptly after the filing of such documents with the SEC. The
Shareholder shall have the right to request that the Company modify any
information contained in such registration statement, amendment and supplement
thereto pertaining to such Shareholder and the Company shall use its
commercially reasonable efforts to comply with such request; provided, however,
that the Company shall not have any obligation so to modify any information if
the Company reasonably expects that doing so would cause the prospectus to
contain an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading.
          (c) After the filing of the registration statement, the Company shall
(i) cause the related prospectus to be supplemented by any required prospectus
supplement, and, as so supplemented, to be filed pursuant to Rule 424 under the
Securities Act, (ii) comply with the provisions of the Securities Act with
respect to the disposition of all Registrable Securities covered by such
registration statement during the applicable period in accordance with the
intended methods of disposition by the Registering Shareholders thereof set
forth in such registration statement or supplement to such prospectus and
(iii) promptly notify each Registering Shareholder holding Registrable
Securities covered by such registration statement of any stop order issued or
threatened by the SEC or any state securities commission and take all reasonable
actions required to prevent the entry of such stop order or to remove it if
entered.

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          (d) The Company shall use its commercially reasonable efforts to
(i) register or qualify the Registrable Securities covered by such registration
statement under such other securities or “blue sky” laws of such jurisdictions
in the United States as any Registering Shareholder holding such Registrable
Securities reasonably (in light of such Shareholder’s intended plan of
distribution) requests and (ii) cause such Registrable Securities to be
registered with or approved by such other governmental agencies or authorities
as may be necessary by virtue of the business and operations of the Company and
do any and all other acts and things that may be reasonably necessary or
advisable to enable such Shareholder to consummate the disposition of the
Registrable Securities owned by such Shareholder; provided that the Company
shall not be required to (A) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 2.04(d), (B) subject itself to taxation in any such jurisdiction or
(C) consent to general service of process in any such jurisdiction.
          (e) The Company shall immediately notify each Registering Shareholder
holding such Registrable Securities covered by such registration statement, at
any time when a prospectus relating thereto is required to be delivered under
the Securities Act, of the occurrence of an event requiring the preparation of a
supplement or amendment to such prospectus so that, as thereafter delivered to
the purchasers of such Registrable Securities, such prospectus will not contain
an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading and promptly prepare and make available to each such Shareholder and
file with the SEC any such supplement or amendment.
          (f) The Company shall select an underwriter or underwriters in
connection with any Public Offering. In connection with any Public Offering, the
Company shall enter into customary agreements (including an underwriting
agreement in customary form) and take such all other actions as are reasonably
required in order to expedite or facilitate the disposition of such Registrable
Securities in any such Public Offering, including the engagement of a “qualified
independent underwriter” in connection with the qualification of the
underwriting arrangements with the NASD.
          (g) Upon execution of confidentiality agreements in form and substance
reasonably satisfactory to the Company, the Company shall make available for
inspection by any Registering Shareholder and any underwriter participating in
any disposition pursuant to a registration statement being filed by the Company
pursuant to this Section 2.04 and any attorney, accountant or other professional
retained by any such Shareholder or underwriter (collectively, the
“Inspectors”), all financial and other records, pertinent corporate documents
and properties of the Company (collectively, the “Records”) as shall be
reasonably necessary or desirable to enable them to exercise their due diligence
responsibility, and cause the Company’s officers, directors and employees to
supply all information reasonably requested by any Inspectors in connection with
such registration statement. Records that the Company determines, in good faith,
to be confidential and that it notifies the Inspectors are confidential shall
not be disclosed by the Inspectors unless (i) disclosure of such information is
required by court or

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administrative order or is necessary to respond to inquiries of regulatory
authorities; (ii) disclosure of such information, in the opinion of counsel to
such Person, is required by law; (iii) such information becomes generally
available to the public other than as a result of a disclosure or failure to
safeguard by such Person or (iv) such information becomes available to such
Person from a source other than the Company and such source is not known by such
Person to be bound by a confidentiality agreement with the Company. The
Shareholder agrees that information obtained by it as a result of such
inspections shall be deemed confidential and shall not be used by it or its
Affiliates as the basis for any market transactions in the Company Securities
unless and until such information is made generally available to the public. The
Shareholder further agrees that, upon learning that disclosure of such Records
is required by court or administrative order or necessary to respond to
inquiries of regulatory authorities, it shall give prompt notice to the Company
in advance of such disclosure and allow the Company to undertake appropriate
action to prevent disclosure of the Records deemed confidential.
          (h) The Company shall furnish to each Registering Shareholder and to
each such underwriter, if any, a signed counterpart, addressed to such
Shareholder or underwriter, of a comfort letter or comfort letters from the
Company’s independent public accountants, in form and substance as are customary
in connection with underwritten public offerings.
          (i) The Company may require each such Registering Shareholder promptly
to furnish in writing to the Company such information regarding the distribution
of the Registrable Securities as the Company may from time to time reasonably
request and such other information as may be legally required in connection with
such registration.
          (j) The Shareholder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 2.04(e),
such Shareholder shall forthwith discontinue disposition of Registrable
Securities pursuant to the registration statement covering such Registrable
Securities until such Shareholder’s receipt of the copies of the supplemented or
amended prospectus contemplated by Section 2.04(e), and, if so directed by the
Company, such Shareholder shall deliver to the Company all copies, other than
any permanent file copies then in such Shareholder’s possession, of the most
recent prospectus covering such Registrable Securities at the time of receipt of
such notice. If the Company shall give such notice, the Company shall extend the
period during which such registration statement shall be maintained effective
(including the period referred to in Section 2.04(a)) by the number of days
during the period from and including the date of the giving of notice pursuant
to Section 2.04(e) to the date when the Company shall make available to such
Shareholder a prospectus supplemented or amended to conform with the
requirements of Section 2.04(e).
          (k) The Company shall use its commercially reasonable efforts to list
all Registrable Securities covered by such registration statement on any
securities

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exchange or quotation system on which any of the Registrable Securities are then
listed or traded.
          (l) The Company shall have appropriate officers of the Company
(i) prepare and make presentations at any “road shows” and before analysts and
rating agencies, as the case may be, (ii) take other actions to obtain ratings
for any Registrable Securities and (iii) otherwise use their commercially
reasonable efforts to cooperate as reasonably requested by the underwriters in
the offering, marketing or selling of the Registrable Securities.
     Section 2.05 Indemnification by the Company. The Company agrees to
indemnify and hold harmless each Registering Shareholder holding Registrable
Securities covered by a registration statement, its officers, directors,
employees, partners and agents, and each Person, if any, who controls such
Shareholder (within the meaning of Section 15 of the Securities Act) from and
against any and all losses, claims, damages, liabilities and expenses (including
reasonable expenses of investigation and reasonable attorneys’ fees and
expenses) (“Damages”) arising out of or relating to any untrue statement or
alleged untrue statement of a material fact contained in any registration
statement or prospectus relating to the Registrable Securities (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) or any preliminary prospectus, or arising out of or relating to any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such Damages are caused by or related to any such untrue
statement or omission or alleged untrue statement or omission so made based upon
information furnished in writing to the Company by such Shareholder or on such
Shareholder’s behalf expressly for use therein; provided that, with respect to
any untrue statement or omission or alleged untrue statement or omission made in
any preliminary prospectus, or in any prospectus, as the case may be, the
indemnity agreement contained in this paragraph shall not apply to the extent
that any Damages result from the fact that a current copy of the prospectus (or
such amended or supplemented prospectus, as the case may be) was not sent or
given to the Person asserting any such Damages at or prior to the written
confirmation of the sale of the Registrable Securities concerned to such Person
if it is determined that the Company has provided such prospectus to such
Shareholder and it was the responsibility of such Shareholder to provide such
Person with a current copy of the prospectus (or such amended or supplemented
prospectus, as the case may be) and such current copy of the prospectus (or such
amended or supplemented prospectus, as the case may be) would have cured the
defect giving rise to such Damages. The Company also agrees to indemnify any
underwriters of the Registrable Securities, their officers and directors and
each Person who controls such underwriters (within the meaning of Section 15 of
the Securities Act) on substantially the same basis as that of the
indemnification of the Shareholders provided in this Section 2.05.
     Section 2.06 Indemnification by Participating Shareholders. Each
Shareholder holding Registrable Securities included in any registration
statement agrees

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to indemnify and hold harmless the Company, its officers, directors, agents and
employees and each Person who controls the Company (within the meaning of
Section 15 of the Securities Act) to the same extent as the foregoing indemnity
from the Company to such Shareholder, but only (i) with respect to information
furnished in writing by such Shareholder or on such Shareholder’s behalf
expressly for use in any registration statement or prospectus relating to the
Registrable Securities, or any amendment or supplement thereto, or any
preliminary prospectus or (ii) to the extent that any Damages result from the
fact that a current copy of the prospectus (or such amended or supplemented
prospectus, as the case may be) was not sent or given to the Person asserting
any such Damages at or prior to the written confirmation of the sale of the
Registrable Securities concerned to such Person if it is determined that it was
the responsibility of such Shareholder to provide such Person with a current
copy of the prospectus (or such amended or supplemented prospectus, as the case
may be) and such current copy of the prospectus (or such amended or supplemented
prospectus, as the case may be) would have cured the defect giving rise to such
loss, claim, damage, liability or expense. The Shareholder also agrees to
indemnify and hold harmless underwriters of the Registrable Securities, their
officers and directors and each Person who controls such underwriters (within
the meaning of Section 15 of the Securities Act) on substantially the same basis
as that of the indemnification of the Company provided in this Section 2.06. As
a condition to including Registrable Securities in any registration statement
filed in accordance with Article II, the Company may require that it shall have
received an undertaking reasonably satisfactory to it from any underwriter to
indemnify and hold it harmless to the extent customarily provided by
underwriters with respect to similar securities.
     Section 2.07 Conduct of Indemnification Proceedings. If any proceeding
(including any governmental investigation) shall be instituted involving any
Person in respect of which indemnity may be sought pursuant to this Article II,
such Person (an “Indemnified Party”) shall promptly notify the Person against
whom such indemnity may be sought (the “Indemnifying Party”) in writing and the
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to such Indemnified Party, and shall assume the
payment of all fees and expenses, provided that the failure of any Indemnified
Party so to notify the Indemnifying Party shall not relieve the Indemnifying
Party of its obligations hereunder except to the extent that the Indemnifying
Party is materially prejudiced by such failure to notify. In any such
proceeding, any Indemnified Party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless (i) the Indemnifying Party and the Indemnified
Party shall have mutually agreed to the retention of such counsel or (ii) in the
reasonable judgment of such Indemnified Party representation of both parties by
the same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that, in connection with any proceeding
or related proceedings in the same jurisdiction, the Indemnifying Party shall
not be liable for the reasonable fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) at any time for all such
Indemnified Parties, and that all such fees and expenses shall be reimbursed as
they

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are incurred. In the case of any such separate firm for the Indemnified Parties,
such firm shall be designated in writing by the Indemnified Parties. The
Indemnifying Party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent, or if
there be a final judgment for the plaintiff, the Indemnifying Party shall
indemnify and hold harmless such Indemnified Parties from and against any loss
or liability (to the extent stated above) by reason of such settlement or
judgment. Without the prior written consent of the Indemnified Party, no
Indemnifying Party shall effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Party is or could have been a
party and indemnity could have been sought hereunder by such Indemnified Party,
unless such settlement includes an unconditional release of such Indemnified
Party from all liability arising out of such proceeding.
     Section 2.08 Contribution. If the indemnification provided for in this
Article II is unavailable to the Indemnified Parties in respect of any Damages,
then each such Indemnifying Party, in lieu of indemnifying such Indemnified
Party, shall contribute to the amount paid or payable by such Indemnified Party
as a result of such Damages (i) as between the Company and the Registering
Shareholder holding Registrable Securities covered by a registration statement,
on the one hand, and the underwriters, on the other, in such proportion as is
appropriate to reflect the relative benefits received by the Company and such
Shareholder on the one hand and the underwriters on the other, from the offering
of the Registrable Securities or, if such allocation is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits but also the relative fault of the Company and such
Shareholder, on the one hand, and of such underwriters, on the other, in
connection with the statements or omissions that resulted in such Damages, as
well as any other relevant equitable considerations and (ii) as between the
Company, on the one hand, and such Shareholder, on the other, in such proportion
as is appropriate to reflect the relative fault of the Company and of such
Shareholder in connection with such statements or omissions, as well as any
other relevant equitable considerations. The relative benefits received by the
Company and such Shareholder, on the one hand, and such underwriters, on the
other, shall be deemed to be in the same proportion as the total proceeds from
the offering (net of underwriting discounts and commissions but before deducting
expenses) received by the Company and such Shareholder bear to the total
underwriting discounts and commissions received by such underwriters, in each
case as set forth in the table on the cover page of the prospectus. The relative
fault of the Company and such Shareholder, on the one hand, and of such
underwriters, on the other, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and such Shareholder or by such underwriters. The
relative fault of the Company, on the one hand, and of such Shareholder, on the
other, shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by such party,
and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.

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     The Company and each Shareholder agree that it would not be just and
equitable if contribution pursuant to this Section 2.08 were determined by pro
rata allocation (even if the underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an Indemnified Party as a result of the Damages
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such Indemnified Party in connection with investigating
or defending any such action or claim. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. The contribution agreement contained in this
Section 2.08 is in addition to any liability that the Indemnifying Parties may
have to the Indemnified Parties.
     Section 2.09 Participation in Public Offering. No Person may participate in
any Public Offering hereunder unless such Person (i) agrees to sell such
Person’s securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and
(ii) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements and the provisions of this Agreement in
respect of registration rights.
     Section 2.10 Other Indemnification. Indemnification similar to that
specified herein (with appropriate modifications) shall be given by the Company
and each Registering Shareholder participating therein with respect to any
required registration or other qualification of securities under any federal or
state law or regulation or governmental authority other than the Securities Act.
     Section 2.11 Cooperation by the Company. If a Shareholder shall transfer
any Registrable Securities pursuant to Rule 144, the Company shall cooperate, to
the extent commercially reasonable, with such Shareholder and shall provide to
such Shareholder such information as such Shareholder shall reasonably request.
     Section 2.12 No Transfer of Registration Rights. None of the rights of a
Shareholder under this Article II shall be assignable by such Shareholder to any
Person acquiring Securities in any Public Offering or pursuant to Rule 144.
     Section 2.13 Underwritten Offering Committee. The Shareholder acknowledges
that the Board has the power, at any time, to alter the composition, mandate and
authority of the Underwritten Offering Committee. The Shareholder has been
informed by the Company that the Underwritten Offering Committee (i) shall
initially include Thomas W. Weisel, who will chair the committee, and (ii) shall
act with the unanimous approval of the members of the committee.

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     Section 2.14 Term of Registration Rights. The Company agrees that, subject
to Section 4.03(b), the rights of a Shareholder with respect to the registration
rights granted pursuant to this Agreement shall remain in effect, subject to the
terms and conditions hereof, so long as there are Registrable Securities issued
and outstanding.
     Section 2.15 Other Agreements. Following the Closing Date, the Company
agrees that:
          (a) it will file the reports required to be filed by the Company under
the Exchange Act, so as to enable a Shareholder to sell Registrable Securities
pursuant to Rule 144;
          (b) it shall cooperate with such Shareholder in connection with any
sale or other disposition by such Shareholder of any Registrable Securities
pursuant to Rule 144;
          (c) it will take such action as such Shareholder may reasonably
request, to the extent required from time to time to enable such Shareholder to
sell its Registrable Securities without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144, including
providing any legal opinions; and
          (d) upon the request of such Shareholder, it shall deliver to such
Shareholder a written certification of a duly authorized officer as to whether
it has complied with such requirements.
ARTICLE III
SHAREHOLDER COVENANTS
     Section 3.01 Confidential Information. In the course of involvement in the
Firm’s activities or otherwise, each Shareholder has obtained or may obtain
confidential information concerning the Firm’s businesses, strategies,
operations, financial affairs, organizational and personnel matters (including
information regarding any aspect of the Shareholder’s tenure as a Managing
Director of the Company or of the termination of such employment), policies,
procedures and other non-public matters, or concerning those of third parties.
Such information (“Confidential Information”) may have been or be provided in
written or electronic form or orally. In consideration of, and as a condition
to, continued access to Confidential Information, and without prejudice to or
limitation on any other confidentiality obligations imposed by agreement or by
law, each Shareholder hereby undertakes to use and protect Confidential
Information in accordance with any restrictions placed on its use or disclosure.
Without limiting the foregoing, except as authorized by the Firm or as required
by law, each Shareholder may not disclose or allow disclosure of any
Confidential Information, or of any information derived therefrom, in whatever
form, to any person unless such person is a director, officer, partner,
employee, attorney or agent of the Firm and, in such Shareholder’s reasonable
good faith judgment, has a need to know the Confidential Information or

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information derived therefrom in furtherance of the business of the Firm. The
foregoing obligations will survive, and remain binding and enforceable
notwithstanding, any termination of a Shareholder’s employment and any
settlement of the financial rights and obligations arising from a Shareholder’s
employment. Without limiting the foregoing, the existence of, and any
information concerning, any dispute between a Shareholder and the Firm shall
constitute Confidential Information except that a Shareholder may disclose
information concerning such dispute to the arbitrator that is considering such
dispute, or to such Shareholder’s legal counsel (provided that such counsel
agrees not to disclose any such information other than as necessary to the
prosecution or defense of the dispute).
     Section 3.02 Noncompetition. (a) In view of each Shareholder’s importance
to the Firm, each Shareholder hereby agrees that the Firm would likely suffer
significant harm from such Shareholder’s competing with the Firm during such
Shareholder’s Employment Period (as defined in the Employment Agreement) and for
some period of time thereafter. Accordingly, each Shareholder hereby agrees that
such Shareholder will not, without the written consent of the Company, during
the Employment Period and for twelve months following the Date of Termination:
     (i) form, or acquire a 5% or greater equity ownership, voting or profit
participation interest in, any Competitive Enterprise; or
     (ii) associate (including, but not limited to, association as an officer,
employee, partner, director, consultant, agent or advisor) with any Competitive
Enterprise and in connection with such association engage in, or directly or
indirectly manage or supervise personnel engaged in, any activity
     (1) which is similar or substantially related to any activity in which such
Shareholder was engaged, in whole or in part, at the Firm,
     (2) for which such Shareholder had direct or indirect managerial or
supervisory responsibility at the Firm, or
     (3) which calls for the application of the same or similar specialized
knowledge or skills as those utilized by such Shareholder in such Shareholder’s
activities at the Firm,
at any time during the one-year period immediately prior to the Date of
Termination (or, in the case of an action taken during the Employment Period,
during the one-year period immediately prior to such action), and, in any such
case, irrespective of the purpose of the activity or whether the activity is or
was in furtherance of advisory, agency, proprietary or fiduciary business of
either the Firm or the Competitive Enterprise.

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(By way of example only, this provision precludes an “advisory” investment
banker from joining a leveraged-buyout firm or a research analyst from becoming
a proprietary trader or joining a hedge fund, in each case without the written
consent of the Company)
          (b) For purposes of the Shareholder Covenants, a “Competitive
Enterprise” is a business enterprise that engages in, or owns or controls a
significant interest in any entity that engages in financial services such as
investment banking, public or private finance, financial advisory services,
private investing (for anyone other than such Shareholder and members of such
Shareholder’s family), merchant banking, asset or hedge fund management,
securities brokerage, sales, lending, custody, clearance, settlement or trading.
          (c) For purposes of the Shareholder Covenants, “Date of Termination”
means such Shareholder’s Date of Termination (as defined in the Employment
Agreement).
     Section 3.03 Nonsolicitation of Clients. (a) Each Shareholder hereby agrees
that during the Employment Period and for twelve months following the Date of
Termination, such Shareholder will not, in any manner, directly or indirectly,
(1) Solicit a Client to transact business with a Competitive Enterprise or to
reduce or refrain from doing any business with the Firm or (2) interfere with or
damage (or attempt to interfere with or damage) any relationship between the
Firm and a Client.
          (b) For purposes of the Shareholder Covenants, the term “Solicit”
means any direct or indirect communication of any kind whatsoever, regardless of
by whom initiated, inviting, advising, encouraging or requesting any person or
entity, in any manner, to take or refrain from taking any action.
          (c) For purposes of the Shareholder Covenants, the term “Client” means
any client or prospective client of the Firm to whom such Shareholder provided
services, or for whom such Shareholder transacted business, or whose identity
became known to such Shareholder in connection with such Shareholder’s
relationship with or employment by the Firm.
     Section 3.04 Nonsolicitation of Employees. Each Shareholder hereby agrees
that during the Employment Period and for twelve months following the Date of
Termination, such Shareholder will not, in any manner, directly or indirectly,
Solicit any person who is an Employee to resign from the Firm or to apply for or
accept employment with any Competitive Enterprise.
     Section 3.05 Transfer of Client Relationships. (a) During the Coverage
Period, each Shareholder hereby agrees to take all actions and do all such
things as may be reasonably requested by the Firm from time to time to maintain
for the

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Firm the business, goodwill, and business relationships with any of the Firm’s
Clients with whom such Shareholder worked during the term of such Shareholder’s
employment.
          (b) For purposes of the Shareholder Covenants, the term “Coverage
Period” means the 90-day period beginning on the date on which notice of such
Shareholder’s termination of employment is delivered to or by the Firm, or in
the case of termination for Cause or on account of Extended Absence (each as
defined in the Employment Agreement), the 90-day period beginning on the Date of
Termination.
     Section 3.06 Prior Notice Required. Each Shareholder hereby agrees that
prior to accepting employment with any other person or entity during the
Employment Period or during the twelve months following the Date of Termination,
such Shareholder will provide such prospective employer with written notice of
the provisions of this Agreement, with a copy of such notice delivered
simultaneously to the General Counsel of the Company.
     Section 3.07 Shareholder Covenants Generally. (a) Each Shareholder’s
covenants as set forth in Sections 3.01 through 3.06 of this Agreement are from
time to time referred to herein as the “Shareholder Covenants.” If any of the
Shareholder Covenants is finally held to be invalid, illegal or unenforceable
(whether in whole or in part), such Shareholder Covenant shall be deemed
modified to the extent, but only to the extent, of such invalidity, illegality
or unenforceability and the remaining Shareholder Covenants shall not be
affected thereby; provided, however, that if any of the Shareholder Covenants is
finally held to be invalid, illegal or unenforceable because it exceeds the
maximum scope determined to be acceptable to permit such provision to be
enforceable, such Shareholder Covenant will be deemed to be modified to the
minimum extent necessary to modify such scope in order to make such provision
enforceable hereunder.
          (b) Each Shareholder understands that the Shareholder Covenants may
limit such Shareholder’s ability to earn a livelihood in a business similar to
the business of the Firm.
          (c) Each Shareholder acknowledges that a violation on such
Shareholder’s part of any of the Shareholder Covenants would cause irreparable
damage to the Firm. Accordingly, each Shareholder agrees that the Firm will be
entitled to injunctive relief for any actual or threatened violation of any of
the Shareholder Covenants in addition to any other remedies it may have.
     Section 3.08 Damages. (a) Each Shareholder acknowledges that such
Shareholder’s compliance with the Shareholder Covenants is an important factor
to the continued success of the Firm’s operations and its future prospects. Each
Shareholder and the Company agree that if at any time such Shareholder were to
breach any of the Shareholder Covenants, the damages to the Firm would be
material, but that the amount of such damages would be uncertain and not readily
ascertainable. Accordingly, each Shareholder and the Company agree that if such
Shareholder breaches any of the

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Shareholder Covenants at any time, such Shareholder shall forfeit to the Company
that number of his or her Company Securities that remain subject to the
restrictions on Transfer under Section 1.04(a) of this Agreement at such time
(it being understood that, for purposes of this Section 3.08, any Transfers
otherwise permitted under Section 1.04(b) at such time shall be prohibited with
respect to the Shareholder), with a Fair Market Value at such time equal to the
dollar amount (the “Liquidated Damages”) communicated to such Shareholder by the
Company on or prior to the date hereof and, if the Fair Market Value of his or
her Company Securities that remain subject to the restrictions on Transfer under
Section 1.04(a) of this Agreement at such time is less than the Liquidated
Damages, a cash payment by such Shareholder to the Company equal to such
difference.
          (b) Each Shareholder and the Company agree that the Liquidated Damages
are reasonable in proportion to the probable damages likely to be sustained by
the Firm if such Shareholder breaches at any time any of the Shareholder
Covenants, that the amount of actual damages to be sustained by the Firm in the
event of such breach is incapable of precise estimation and that such forfeiture
is not intended to constitute a penalty or punitive damages for any purposes.
The forfeiture by such Shareholder of his or her Company Securities or any cash
payment by such Shareholder as the Liquidated Damages will not be construed as a
release or waiver by the Company of the right to prevent the continuation of any
such violation of such Shareholder Covenants in equity (including injunctive
relief) or otherwise.
          (c) Each Shareholder acknowledges and agrees that such Shareholder’s
obligations under this Section 3.08 will be full recourse obligations and will
be secured pursuant to the Pledge Agreement.
          (d) Each Shareholder acknowledges and agrees that the Liquidated
Damages pursuant to this Section 3.08 shall be in addition to, and not in lieu
of, any required forfeitures of awards that may be granted to such Shareholder
in the future under one or more of the Company’s compensation and benefit plans.
     Section 3.09 Arbitration. Any dispute, controversy or claim between a
Shareholder and the Firm arising out of or relating to or concerning the
provisions of the Shareholder Covenants, the Pledge Agreement, any agreement
between a Shareholder and the Company relating to or arising out of such
Shareholder’s employment with the Firm or otherwise concerning any rights,
obligations or other aspects of such Shareholder’s employment relationship in
respect of the Firm (“Employment Related Matters”) shall be finally settled by
arbitration in New York City before, and in accordance with the rules then
obtaining of, the NASD or, if the NASD declines to arbitrate the matter, the AAA
in accordance with the commercial arbitration rules of the AAA.
     Section 3.10 Compensation. Each Shareholder hereby acknowledges that the
Company intends to maintain the Company’s total compensation and benefits

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expense, including that payable to the Shareholders as employees but excluding
equity awards to be made in connection with the initial public offering of
Common Shares, at between 55% and 58% of its net revenues in each fiscal year,
beginning in 2006 (although the Company retains the ability to change this rate
in the future). Compensation and benefits expense will include, among other
things, all salaries, bonus and other compensation (both cash and non-cash) paid
by the Company and its subsidiaries to their employees.
ARTICLE IV
MISCELLANEOUS
     Section 4.01 Binding Effect; Assignability; Benefit. (a) This Agreement
shall inure to the benefit of and be binding upon the parties hereto and their
respective heirs, successors, legal representatives and permitted assigns. A
Shareholder shall cease to be bound by the terms hereof when such Shareholder
ceases to own beneficially any Company Securities (other than (i) the provisions
of Sections 2.05, 2.06, 2.07, 2.08 and 2.10 applicable to such Shareholder with
respect to any offering of Registrable Securities completed before the date such
Shareholder ceased to own any Company Securities; (ii) Article III and
(iii) Sections 4.02, 4.04, 4.05, 4.06, 4.07 and 4.08).
          (b) Neither this Agreement nor any right, remedy, obligation or
liability arising hereunder or by reason hereof shall be assignable by any party
hereto pursuant to any Transfer of Company Securities or otherwise, except that
any Permitted Transferee acquiring Company Securities shall (unless already
bound hereby) execute and deliver to the Company an agreement to be bound by
this Agreement in the form of Exhibit A hereto and shall thenceforth be a
“Shareholder”.
          (c) Nothing in this Agreement, expressed or implied, is intended to
confer on any Person other than the parties hereto, and their respective heirs,
successors, legal representatives and permitted assigns, any rights, remedies,
obligations or liabilities under or by reason of this Agreement.
     Section 4.02 Notices. All notices, requests and other communications to any
party shall be in writing and shall be delivered in person, mailed by certified
or registered mail, return receipt requested, or sent by facsimile transmission,

              if to the Company to:
 
       
 
      Thomas Weisel Partners Group, Inc.
 
      One Montgomery Street
 
      San Francisco, CA 94104
 
      Attention: General Counsel
 
      fax: (415) 364-2694

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              with a copy to:
 
 
      Sullivan & Cromwell LLP
 
      1870 Embarcadero Road
 
      Palo Alto, CA 94303
 
      Attention: Scott D. Miller, Esq.
 
      fax: (650) 461-5700
 
            if to a Shareholder, to the last known address of such Shareholder
set forth in the records maintained by the Company.

     Any and all notices or other communications or deliveries required or
permitted to be provided pursuant to this Agreement shall be in writing and
shall be deemed to have been effectively given (a) upon personal delivery to the
party to be notified, (b) when sent by confirmed telex or facsimile if sent
during normal business hours of the party to be notified or, if not, then on the
next Business Day, (c) five Business Days after having been sent by registered
or certified mail, return receipt requested, postage prepaid or (d) one Business
Day after deposit with a nationally recognized overnight courier, specifying
next Business Day delivery, with written verification of receipt.
     Any Person that becomes a Shareholder shall provide its address and fax
number to the Company.
     Section 4.03 Waiver; Amendment; Termination. (a) No provision of this
Agreement may be waived except by an instrument in writing executed by the party
against whom the waiver is to be effective. No provision of this Agreement may
be amended or otherwise modified except by an instrument in writing executed by
the Company with approval of the Board.
          (b) This Agreement shall terminate on the tenth anniversary of the
date hereof unless earlier terminated.
     Section 4.04 Fees and Expenses. Except as otherwise provided in this
Agreement, each party hereto shall pay its own fees and expenses incurred in
connection with the preparation of this Agreement, or any amendment or waiver
hereof, and the transactions contemplated hereby and all matters related hereto.
     Section 4.05 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
     Section 4.06 Jurisdiction. The parties hereby agree that, unless otherwise
set forth in this Agreement, any suit, action or proceeding seeking to enforce
any provision of, or based on any matter arising out of or in connection with,
this Agreement or the transactions contemplated hereby shall be brought in the
United States

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District Court for the Northern District of California or any California State
court sitting in San Francisco, so long as one of such courts shall have subject
matter jurisdiction over such suit, action or proceeding, and that any case of
action arising out of this Agreement shall be deemed to have arisen from a
transaction of business in the State of California, and each of the parties
hereby irrevocably consents to the jurisdiction of such courts (and of the
appropriate appellate courts therefrom) in any such suit, action or proceeding
and irrevocably waives, to the fullest extent permitted by law, any objection
that it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding in any such court or that any such suit, action or
proceeding which is brought in any such court has been brought in an
inconvenient form. Process in any such suit, action or proceeding may be served
on any party anywhere in the world, whether within or without the jurisdiction
of any such court. Without limiting the foregoing, each party agrees that
service of process on such party as provided in Section 4.02 shall be deemed
effective service of process on such party.
     Section 4.07 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
     Section 4.08 Specific Enforcement. Each party hereto acknowledges that the
remedies at law of the other parties for a breach or threatened breach of this
Agreement would be inadequate and, in recognition of this fact, any party to
this Agreement, without posting any bond, and in addition to all other remedies
that may be available, shall be entitled to obtain equitable relief in the form
of specific performance, a temporary restraining order, a temporary or permanent
injunction or any other equitable remedy that may then be available.
     Section 4.09 Counterparts; Effectiveness. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received counterparts hereof signed by all of the other parties hereto.
     Section 4.10 Entire Agreement. This Agreement and the Employment Agreement
constitutes the entire agreement among the parties hereto and supersede all
prior and contemporaneous agreements and understandings, both oral and written,
among the parties hereto with respect to the subject matter hereof and thereof.
     Section 4.11 Captions. The captions herein are included for convenience of
reference only and shall be ignored in the construction or interpretation
hereof.
     Section 4.12 Severability. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, the remainder of the terms,
provisions,

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covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
ARTICLE V
DEFINITIONS
     Section 5.01 Definitions. The following terms, as used herein, have the
following meanings:
     “AAA” means the American Arbitration Association.
     “Affiliate” means, with respect to any Person, any other Person directly or
indirectly controlling, controlled by or under common control with such Person,
provided that no securityholder of the Company shall be deemed an Affiliate of
any other securityholder solely by reason of any investment in the Company. For
the purpose of this definition, the term “control” (including, with correlative
meanings, the terms “controlling”, “controlled by” and “under common control
with”), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities,
by contract or otherwise.
     “Agreement” has the meaning set forth in the preamble.
     “Anniversary Period” means, at any time, the twelve-month period which
commenced on the immediately preceding anniversary of the Closing Date.
     “Board” means the board of directors of the Company.
     “Business Day” means any day except a Saturday, Sunday or other day on
which commercial banks in New York City, New York or San Francisco, California
are authorized by law to close.
     “By-laws” means the By-laws of the Company, as amended from time to time.
     “Change of Control” means (A) the consummation of a merger, consolidation,
statutory share exchange or similar form of corporate transaction involving the
Company or the sale or other disposition of all or substantially all of the
assets of the Company to an entity that is not an Affiliate or that, in each
case, requires shareholder approval under the laws of the Company’s jurisdiction
of organization, unless immediately following such transaction, either: (i) at
least 50% of the total voting power of the surviving entity or its parent
entity, if applicable, is represented by securities of the Company that were
outstanding immediately prior to the transaction (or securities into which the
Company’s securities were converted or exchanged in such transaction); or
(ii) at least 50% of the members of the board of directors (including directors
whose

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election or nomination was approved by the incumbent directors of the Board) of
the company resulting from the transaction were members of the Board at the time
of the Board’s approval of the execution of the initial agreement providing for
the transaction or (B) the filing by any “person” or “group” (in each case
within the meaning of Section 13(d)(3) of the Exchange Act), other than the
Company, of a Schedule TO or any other schedule, form or report under the
Exchange Act, disclosing that such person or group has become the direct or
indirect “beneficial owner,” as defined in Rule 13d-3 under the Exchange Act, of
Company Securities representing more than 50% of the total voting power of the
Company.
     “Charitable Organization” has the meaning set forth in Section 1.04(a)(iv)
of this Agreement.
     “Charter” means the Certificate of Incorporation of the Company, as amended
from time to time.
     “Client” has the meaning set forth in Section 3.03(c) of this Agreement.
     “Closing Date” means February 7, 2006.
     “Code” means the Internal Revenue Code of 1986, as amended.
     “Common Shares” means shares of Common Stock.
     “Common Stock” means the common stock, par value $0.01 per share, of the
Company and any stock into which such Common Stock may thereafter be converted
or changed.
     “Company” has the meaning set forth in the preamble.
     “Company Securities” means, with respect to a Shareholder, (i) the Common
Stock, (ii) securities convertible into or exchangeable for Common Stock,
(iii) any other equity or equity-linked security issued by the Company and
(iv) options, warrants or other rights to acquire Common Stock or any other
equity or equity-linked security issued by the Company and, in each case,
beneficially owned by the Shareholder as of the Closing Date.
     “Competitive Enterprise” has the meaning set forth in Section 3.02(b) of
this Agreement.
     “Confidential Information” has the meaning set forth in Section 3.01 of
this Agreement.
     “Coverage Period” has the meaning set forth in Section 3.05(b) of this
Agreement.

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     “Damages” has the meaning set forth in Section 2.05 of this Agreement.
     “Date of Termination” has the meaning set forth in Section 3.02(c) of this
Agreement.
     “Demand Registration” has the meaning set forth in Section 2.01(a) of this
Agreement.
     “Eligible Shareholder” has the meaning set forth in Section 2.01(a)(v) of
this Agreement.
     “Employee” means any person employed by the Firm who receives compensation,
other than a person receiving compensation in the nature of a consulting fee, a
pension or a retainer.
     “Employment Agreement” means the employment agreement between a Shareholder
and the Company of even date herewith.
     “Employment Related Matters” has the meaning set forth in Section 3.09 of
this Agreement.
     “Exchange Act” means the Securities Exchange Act of 1934, as amended.
     “Fair Market Value” means, as of any date, (1) in the case of a Common
Share, the average of the daily closing prices for a Common Share on the
principal securities exchange or market on which the Common Stock is traded for
the 20 consecutive Business Days (or, if such trading has commenced less than 20
Business Days prior to the date in question, the actual number of Business Days
elapsed since the commencement of such trading) before the date in question, and
(2) otherwise, the fair market value thereof as determined in good faith by the
Company. Any good faith determination by the Company of the Fair Market Value
under this Agreement will be binding on the Shareholders.
     “Family Member” has the meaning set forth in Section 1.04 (a)(iv) of this
Agreement.
     “Firm” means the Company, together with its Subsidiaries.
     “Indemnified Party” has the meaning set forth in Section 2.07 of this
Agreement.
     “Indemnifying Party” has the meaning set forth in Section 2.07 of this
Agreement.
     “Initial Ownership” means, with respect to a Shareholder at any time, the
fraction, the numerator of which is the number of Common Shares beneficially
owned (as

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such term is defined in Rule 13d-3 under the Exchange Act) by such Shareholder
as of the Closing Date and the denominator of which is the number of Common
Shares beneficially owned by the Shareholder and all Other Shareholders who are
then Eligible Shareholders.
     “Inspectors” has the meaning set forth in Section 2.04(g) of this
Agreement.
     “Liquidated Damages” has the meaning set forth in Section 3.08(a) of this
Agreement.
     “Lock-Up Period” has the meaning set forth in Section 2.03 of this
Agreement.
     “Maximum Offering Size” has the meaning set forth in Section 2.01(e) of
this Agreement.
     “Maximum Share Number” means, with respect to any Anniversary Period, the
aggregate number of Common Shares that the Shareholder and the Other
Shareholders shall be permitted to Transfer in a registered offering. The
Maximum Share Number shall be (A) for the Anniversary Period ending on the first
anniversary of the Closing Date, 2,473,051 and (B) for each Anniversary Period
thereafter until the fifth anniversary of the Closing Date, that number of
Common Shares as the Underwritten Offering Committee shall decide in its sole
discretion.
     “NASD” means the National Association of Securities Dealers, Inc.
     “Other Shareholder” means any other shareholder of the Company who is party
to this Agreement.
     “Permitted Transferee” means a Person to whom Company Securities are
Transferred (A) pursuant to Section 1.04(b)(iii) or (B) by will or the laws of
descent and distribution.
     “Person” means an individual, corporation, limited liability company,
partnership, association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
     “Piggyback Registration” has the meaning set forth in Section 2.02(a) of
this Agreement.
     “Pledge Agreement” means the pledge agreement entered into between the
Shareholder and the Company of even date herewith.

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     “Pro Rata Portion” means, with respect to a Shareholder, that portion of
the Maximum Share Number calculated by multiplying the Maximum Share Number by
such Shareholder’s Initial Ownership.
     “Public Offering” means an underwritten public offering of Registrable
Securities of the Company pursuant to an effective registration statement under
the Securities Act, other than pursuant to a registration statement on Form S-4
or Form S-8 or any similar or successor form.
     “Public Offering Limitations” has the meaning set forth in
Section 2.01(a)(iv) of this Agreement.
     “Records” has the meaning set forth in Section 2.04(g) of this Agreement.
     “Registering Shareholders” has the meaning set forth in Section 3.01(a) of
this Agreement.
     “Registrable Securities” means, with respect to a Shareholder, any Common
Shares and any securities issued or issuable in respect of such Shares by way of
conversion, exchange, stock dividend, split or combination, recapitalization,
merger, consolidation, other reorganization or otherwise; provided, however,
that such Registrable Securities shall cease to be Registrable Securities at any
time when (i) a registration statement covering such Shares has been declared
effective by the SEC and such Shares have been disposed of pursuant to such
effective registration statement, (ii) such Shares are sold under circumstances
in which all of the applicable conditions of Rule 144 are met or such securities
may be sold pursuant to Rule 144(k) or (iii) such Shares are otherwise
Transferred, the Company has delivered a new certificate or other evidence of
ownership for such Shares not bearing the legend required pursuant to this
Agreement and such Shares may be resold without subsequent registration under
the Securities Act.
     “Registration Expenses” means any and all expenses incident to the
performance of or compliance with any registration or marketing of securities,
including all (i) registration and filing fees, and all other fees and expenses
payable in connection with the listing of securities on any securities exchange
or automated interdealer quotation system, (ii) fees and expenses of compliance
with any securities or “blue sky” laws (including reasonable fees and
disbursements of counsel in connection with “blue sky” qualifications of the
securities registered), (iii) expenses in connection with the preparation,
printing, mailing and delivery of any registration statements, prospectuses and
other documents in connection therewith and any amendments or supplements
thereto, (iv) security engraving and printing expenses, (v) internal expenses of
the Company (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), (vi) reasonable
fees and disbursements of counsel for the Company and customary fees and
expenses for independent certified public

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accountants retained by the Company (including the expenses relating to any
comfort letters or costs associated with the delivery by independent certified
public accountants of any comfort letters requested pursuant to
Section 2.04(h)), (vii) reasonable fees and expenses of any special experts
retained by the Company in connection with such registration, (viii) reasonable
fees, out-of-pocket costs and expenses of the Shareholders, including one
counsel for all of the Shareholders participating in the offering selected by
the Shareholders holding the majority of the Registrable Securities to be sold
for the account of all Shareholders in the offering, (ix) fees and expenses in
connection with any review by the NASD of the underwriting arrangements or other
terms of the offering, and all fees and expenses of any “qualified independent
underwriter,” including the fees and expenses of any counsel thereto, (x) fees
and disbursements of underwriters customarily paid by issuers or sellers of
securities, but excluding any underwriting fees, discounts and commissions
attributable to the sale of Registrable Securities, (xi) costs of printing and
producing any agreements among underwriters, underwriting agreements, any “blue
sky” or legal investment memoranda and any selling agreements and other
documents in connection with the offering, sale or delivery of the Registrable
Securities, (xii) transfer agents’ and registrars’ fees and expenses and the
fees and expenses of any other agent or trustee appointed in connection with
such offering, (xiii) expenses relating to any analyst or investor presentations
or any “road shows” undertaken in connection with the registration, marketing or
selling of the Registrable Securities, (xiv) fees and expenses payable in
connection with any ratings of the Registrable Securities, including expenses
relating to any presentations to rating agencies and (xv) all out-of pocket
costs and expenses incurred by the Company or its appropriate officers in
connection with their compliance with Section 2.04(l).
     “Reorganization” has the meaning set forth in the recitals.
     “Reorganization Agreement” has the meaning set forth in the recitals.
     “Requesting Shareholder” has the meaning set forth in Section 2.01(a) of
this Agreement.
     “Rule 144” means Rule 144 promulgated by the SEC pursuant to the Securities
Act, as amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC having substantially the same effect as such rule.
     “SEC” means the United States Securities and Exchange Commission.
     “Securities Act” means the Securities Act of 1933, as amended.
     “Shareholder” has the meaning set forth in the preamble.
     “Shareholder Covenants” means the provisions contained in Sections 3.01
through 3.06 of this Agreement.
     “Shares” means Common Shares.

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     “Shortfall” means, in respect of any registration, the difference between
the Maximum Share Number and the number of Common Shares requested to be
included in that registration by each Shareholder who is an Eligible
Shareholder.
     “Solicit” has the meaning set forth in Section 3.03(b) of this Agreement.
     “Subsidiary” means, with respect to any Person, any entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by such Person.
     “Transfer” means, with respect to any Company Securities, (i) when used as
a verb, to sell, assign, dispose of, exchange, pledge, encumber, hypothecate or
otherwise transfer such Company Securities or any participation or interest
therein, whether directly or indirectly, or agree or commit to do any of the
foregoing and (ii) when used as a noun, a direct or indirect sale, assignment,
disposition, exchange, pledge, encumbrance, hypothecation, or other transfer of
such Company Securities or any participation or interest therein or any
agreement or commitment to do any of the foregoing, in each case of (i) and
(ii), other than a pledge by the Shareholder of his or her Company Securities as
collateral pursuant to the Pledge Agreement.
     “TWPG LLC” has the meaning set forth in the recitals.
     “Underwritten Offering Committee” means the committee designated by the
Board and to which committee the Board has delegated the power to (i) open a
Window Period and (ii) approve Transfers in accordance with Section 1.04.
     “Window Period” means such period of time, from time to time, commencing on
the 180th day following the Closing Date and ending on the fifth anniversary of
the Closing Date, as the Underwritten Offering Committee shall in its sole
discretion determine, when a Shareholder will be permitted to request Demand
Registrations, subject to the provisions of Article II.

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the date and year first above written.

            THOMAS WEISEL PARTNERS GROUP, INC.
      By:   /s/ Mark Fisher         Name:   Mark Fisher        Title:   General
Counsel and Secretary     

     
 
[NAMES OF PARTNERS]
 
   
 
                                                              

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EXHIBIT A
JOINDER AGREEMENT TO PARTNERS’ EQUITY AGREEMENT
     This Joinder Agreement (this “Joinder Agreement”) is made as of the date
written below by the undersigned (the “Joining Party”) in accordance with the
Partners’ Equity Agreement, dated as of February ___, 2006 (the “Partners’
Equity Agreement”) by and between Thomas Weisel Partners Group, Inc. and the
individuals listed on the signature page thereto, as the same may be amended
from time to time. Capitalized terms used but not defined herein shall have the
meaning ascribed to such terms in the Partners’ Equity Agreement.
     The Joining Party hereby acknowledges, agrees and confirms that, by its,
his or her execution of this Joinder Agreement, the Joining Party shall be
deemed to be a party to the Partners’ Equity Agreement as of the date hereof and
shall have all of the rights and obligations of a “Shareholder” thereunder as if
it, he or she had executed the Partners’ Equity Agreement. The Joining Party
hereby ratifies, as of the date hereof, and agrees to be bound by, all of the
terms, provisions and conditions contained in the Partners’ Equity Agreement.
     IN WITNESS WHEREOF, the undersigned has executed this Joinder Agreement as
of the date and year written below.

          Date: ____________, 20__  [NAME OF JOINING PARTY]
      By:           Name:           Title:  

      Address for Notices: