Exhibit 10(h)(5)

AMENDED AND RESTATED RESTRICTED STOCK AGREEMENT

THIS AMENDED AND RESTATED RESTRICTED STOCK AGREEMENT (this “Agreement”, together
with the Option Award Letter attached hereto, the “Equity Agreements”) is
entered into as of December 13, 2006 and effective as of the Effective Date (as
defined below), among NewStar Financial, Inc., a Delaware corporation (formerly
known as Novus Capital, Inc., the “Company”), and David R. Dobies, the holder of
the number of shares of Class A Common Stock (as defined below), set forth under
the heading “Restricted Stock” on Schedule I hereto (such person being referred
to as the “Management Stockholder”).

WITNESSETH:

WHEREAS, on June 17, 2004, the Management Stockholder and the Company entered
into a Restricted Stock Agreement (the “Original Agreement”) which set forth
certain rights and restrictions of the Management Stockholder with respect to
the Restricted Stock (as hereinafter defined);

WHEREAS, the Original Agreement contemplated, among other things, that upon the
initial public offering of the Common Stock (the “IPO”), the Company would grant
the Management Stockholder options to purchase Common Stock based on the
formulas set forth in Section 4 of the Original Agreement (the “RSA Options”);

WHEREAS, upon the effective date of the registration statement on form S-1
registering the IPO (the “Effective Date”), the Company will grant the
Management Stockholders the RSA Options in the form attached hereto as Exhibit A
and the Investors (as defined in the Original Agreement) will have been deemed
to have achieved the Minimum Required Internal Rate of Return (as defined in the
Original Agreement);

WHEREAS, pursuant to the terms of the Company’s second amended and restated
certificate of incorporation, upon the consummation of the IPO, each of the
Company’s outstanding shares will, pursuant to a reverse stock split (the
“Reverse Stock Split”), automatically be deemed .4031 shares;

WHEREAS, pursuant to the terms of the Company’s second amended and restated
certificate of incorporation, immediately following the Reverse Stock Split,
each share of the Company’s Class A Common Stock shall automatically convert to
one share of the Company’s Common Stock (the “Class A Conversion”);

WHEREAS, each of the Management Stockholder and the Company desire to amend and
restate the Original Agreement as set forth herein;

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NOW, THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Management Stockholder hereby agree as
follows:

1. Certain Definitions. For purposes of the Equity Agreements, the following
terms shall have the following meanings:

“Award” means the shares of Restricted Stock and RSA Options described
hereunder. Awards may be granted for services to be rendered or for services
already rendered to the Company or any Affiliate.

“Affiliate” means (i) with respect to any Person, any other Person directly or
indirectly controlling, controlled by or under common control with such first
Person, (ii) a partner, member or stockholder of any Stockholder, or (iii) any
spouse, domestic partner, child, grandchild, parent, grandparent or sibling of a
Stockholder or a trust or other entity for their benefit; provided that no
securityholder of the Company shall be deemed an Affiliate of any other
securityholder solely by reason of an investment in the Company. For the
purposes of this definition, “control” (including, with correlative meanings,
the terms “controlling,” “controlled by” and “under common control with”) means,
with respect to any Person, the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of such Person,
whether through ownership of voting securities, by contract or otherwise.

“Aggregate Purchase Price” means $1,594.12.

“Amended and Restated Restricted Stock Agreements” shall mean the Amended and
Restated Restricted Stock Agreements, substantially in the form of this
agreement, entered into between the Company and the Management Members on the
date hereof.

“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 are authorized by law to close.

“Cause” means “Cause” as defined in the Management Stockholder’s employment
agreement with the Company or, if the Management Stockholder does not have an
employment agreement with the Company, (i) the willful and continued failure of
the Management Stockholder to perform substantially the Management Stockholder’s
duties with the Company or one of its affiliates (other than any such failure
resulting from incapacity due to physical or mental illness), after a written
demand for substantial performance is delivered to the Management Stockholder by
the Board of Directors, which specifically identifies the manner in which the
Board of Directors believes that the Management Stockholder has not
substantially performed the Management Stockholder’s duties, or (ii) willful
engaging by the Management Stockholder in illegal conduct or gross misconduct
which is materially and demonstrably injurious to the Company or its affiliates,
or (iii) conviction of or made a plea of guilty or nolo contendere to, a felony,
or (iv) a material breach of his or her obligations under Section 4 or Section 5
hereof. For purposes of this definition of “Cause”, no act or failure to act on
the part of the Management Stockholder shall be considered “willful” unless it
is done, or omitted to be done, by the Management Stockholder in bad faith or
without reasonable belief that the Management Stockholder’s actions or omission
was in the best interests of the Company. Any act, or failure to act, based upon
express authority given pursuant to a resolution duly adopted by

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the Board of Directors with respect to such act or omission or upon the
instructions of the Chief Executive Officer of the Company or based upon the
advice of counsel for the Company shall be conclusively presumed to be done, or
omitted to be done, by the Management Stockholder in good faith and in the best
interests of the Company.

“Change of Control” means the occurrence of one or more of the following events:

(a) the consummation of a merger or consolidation of the Company with or into
any other corporation or other entity in which holders of the Company’s voting
securities immediately prior to such merger or consolidation will not, directly
or indirectly, continue to hold at least a majority of the outstanding voting
securities of the Company;

(b) a sale, lease, exchange or other transfer (in one transaction or a related
series of transactions) of all or substantially all of the Company’s assets;

(c) the acquisition by any person or any group of persons, acting together in
any transaction or related series of transactions, of such quantity of the
Company’s voting securities as causes such person, or group of persons, to own
beneficially, directly or indirectly, as of the time immediately after such
transaction or series of transactions, 51% or more of the combined voting power
of the voting securities of the Company other than as a result of (X) an
acquisition of securities directly from the Company or (Y) an acquisition of
securities by the Company which by reducing the voting securities outstanding
increases the proportionate voting power represented by the voting securities
owned by any such person or group of persons to 50% or more of the combined
voting power of such voting securities;

(d) a change in the composition of the Board within a two (2) year period such
that a majority of the members of the Board are not Continuing Directors; or

(e) the liquidation or dissolution of the Company;

provided, however, that in no case shall (1) the public offering and sale of the
Company’s Common Stock by its stockholders pursuant to a registered secondary
offering or (2) the voluntary or involuntary bankruptcy of the Company
constitute a Change in Control.

“Change of Control Liquidity Event” means a Change of Control and, within two
years after such Change of Control, either (i) the termination of the Management
Stockholder without Cause (provided that the termination was not for Performance
Reasons with respect to which the Management Stockholder received written notice
from the Board of such acts or omissions resulting in Performance Reasons prior
to such Transfer and failed to cure the same within the cure period provided by
the Board in accordance with the definition of the term “Performance Reasons”)
or (ii) the termination by the Management Stockholder for Good Reason.

“Class A Common Stock” means the Company’s authorized shares of Class A Common
Stock, par value $0.01 per share.

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“Common Stock” means the Company’s authorized shares of common stock, par value
$0.01 per share, and any stock into which such Common Stock may thereafter be
converted, changed, reclassified or exchanged.

“Company Entity” means the Company or one of its Subsidiaries.

“Confidential Information” means any information relating to the business or
affairs of the Company Entities or, as provided below, any of their respective
Affiliates, including, but not limited to, customer identities, potential
customers, employees, business and financial strategies, methods or practices,
business plans, financial models, proposals, documents or materials owned,
developed or possessed by a Company Entity, profit margins or other proprietary
information used by such Company Entity or any of its Affiliates; provided that
Confidential Information shall not include (i) information that is or becomes
generally known to the public other than as a result of a disclosure by the
Management Stockholder in violation of this Agreement, (ii) information that was
known to the Management Stockholder prior to becoming a consultant to or an
employee of the Company or (iii) information which becomes known to the
Management Stockholder following a Termination Event, through no wrongful act of
the Management Stockholder, by disclosure from a third party unless the
Management Stockholder has reason to believe that such third party is under an
obligation or duty of confidentiality or secrecy with respect to such
information or is an employee, officer, director or stockholder of the Company;
and provided, further, that (A) in such case where any Affiliate has a separate
confidentiality requirement or agreement to which any Company Entity is subject,
such confidentiality requirement or agreement shall supercede the requirements
herein and (B) unless a confidentiality requirement or agreement referred to in
the preceding clause (A) exists with respect to an Affiliate, Confidential
Information for purposes of this definition as it relates to Affiliates shall be
deemed to include only Confidential Information of Affiliates, the employees or
consultants of which, are participants or observers at Board meetings of the
Company.

“Continuing Directors” shall mean as of any date of determination, any member of
the Board who (i) was a member of the Board immediately after the date of the
Company’s initial public offering, or (ii) was nominated for election or elected
to the Board with the approval of, or whose election to the Board was ratified
by, at least a majority of the Continuing Members who were members of the Board
at the time of that nomination or election.

“Corporate Transaction” means any exchange, reclassification or other conversion
of shares of Common Stock into any cash, securities, or other property pursuant
to a merger or consolidation of the Company or any Subsidiary of the Company
with any Person.

“Forfeiture” means the transfer by the Management Stockholder to the Company of
Restricted Stock in exchange for the Purchase Price and the forfeiture by the
Management Stockholder of any and all rights, interests and claims in respect of
such shares of Restricted Stock upon the occurrence of an event specified in,
and to the extent provided in, Section 2. “Forfeited” shall have a corollary
meaning when used herein.

“Good Reason” means “Good Reason” as defined in the Management Stockholder’s
employment agreement with the Company or, if the Management Stockholder

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does not have an employment agreement with the Company, the occurrence of (i) a
reduction by the relevant Company Entity in the Management Stockholder’s annual
base salary from such Management Stockholder’s annual base salary then in
effect, (ii) a forced relocation by the relevant Company Entity of the
Management Stockholder’s place of employment to a location greater than twenty
five (25) miles from his or her initial place of employment or, if the
Management Stockholder’s initial place of employment is in the Darien,
Connecticut office of the Company, outside of Fairfield County, Connecticut or
(iii) a material diminution by the relevant Company Entity in the Management
Stockholder’s principal duties and responsibilities; provided that a change or
restructuring of the reporting structure of the Company or of the person to
which the Management Stockholder directly reports or a change in the Management
Stockholder’s title shall not constitute a material diminution of the Management
Stockholder’s duties and responsibilities for purposes of clause (iii).

“Management Members” means the Management Stockholder and all other Persons that
are parties to Amended and Restated Restricted Stock Agreements.

“Non-Forfeitable Shares” means the shares of Restricted Stock which are no
longer subject to Forfeiture under Section 2(a) or Section 2(c)(i).

“Nonqualified Stock Option” shall mean a stock option not described in Sections
422(b) or 423(b) of the Code.

“Performance Reasons” shall exist (i) when the Management Stockholder fails to
meet commercially reasonable written performance objectives and has failed to
cure (if the failure is not due to acts, events or conditions outside of the
Management Stockholder’s control) such act or omission or acts or omissions to
the reasonable satisfaction of the Board, within such reasonable time as the
Board shall determine and specify in such written notice, but in no case less
than thirty (30) days after receipt of written notice from the Company,
specifying such act or omission, or (ii) if the Management Stockholder is
unwilling to relocate to a location less than twenty-five (25) miles from their
initial place of employment or, if the Management Stockholder’s initial place of
employment is in the Darien, Connecticut office of the Company, outside of
Fairfield County, Connecticut.

“Permitted Transferee” means any spouse, domestic partner, lineal descendant,
sibling, parent, heir, executor, administrator, charitable trust, testamentary
trustee, legatee or beneficiary of the Management Stockholder or a trust, the
beneficiaries of which, or a corporation or partnership, the stockholders or
partners of which, include only the Management Stockholder and any spouse,
domestic partner, lineal descendant, sibling, parent or heir of the Management
Stockholder.

“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.

“Purchase Price” means, with respect to a Forfeiture, the amount obtained by
dividing the Aggregate Purchase Price by the number of shares of Restricted
Stock to be Forfeited.

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“Restricted Business” means any of the following: (i) the business of extending
senior, subordinated or asset-based loans to middle-market companies as targeted
by the Company at the effective date of the Termination Event, (ii) providing
real estate financing of the types offered by the Company at the effective date
of the Termination Event, (iii) extending asset-backed loans or investing in
asset-backed securities with financial products of the types then offered by the
Company at the effective date of the Termination Event or (iv) any other
material line of business engaged in by the Company at the effective date of the
Termination Event.

“Restricted Stock” means the shares of Common Stock set forth under the heading
“Restricted Stock” on Schedule I hereto and any and all securities that are
distributed or paid in respect of Restricted Stock, including as a result of a
stock dividend or distribution, stock split, recapitalization or similar
transaction, including a Corporate Transaction.

“Stockholders Agreement” means the Stockholders’ Agreement among the Company and
the securityholders named therein, dated June 18, 2004, and all amendments
thereto.

“Subsidiary” means, with respect to the Company, any Person in which the Company
owns at least fifty-one percent (51%) of the voting control or economic
interests and which is an operating subsidiary of the Company.

“Termination Event” means the termination of employment or consultancy of the
Management Stockholder with the relevant Company Entity.

“Transfer” means, with respect to any shares of capital stock of the Company,
(i) when used as a verb, to sell, assign, dispose of, exchange, pledge,
encumber, hypothecate or otherwise transfer such shares 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 shares or any participation or interest therein or any
agreement or commitment to do any of the foregoing; provided, however, that any
pledge of such shares to the Company or to a lender of a Company Entity as
security for such Company Entity’s obligations shall not constitute a Transfer
for purposes hereof.

2. Terms and Conditions of Awards. The Awards, and any shares of Common Stock
issued pursuant to an exercise of an RSA Option, shall be subject to the terms
and conditions of the 2006 Incentive Plan of the Company (the “Incentive Plan”)
(although such Awards and any shares of Common Stock issued with respect to the
exercise of any RSA Options shall not be deemed to have been granted under the
Incentive Plan), including, without limitation, Article IX (Parachute
Limitations), Article XI (Administration) and Article XII (Miscellaneous
Provisions), including any amendments thereto, but excluding Article II (Shares
Subject to Plan). Any capitalized terms not defined herein shall have the
meanings ascribed to them in the Incentive Plan.

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3. Release or Forfeiture of Restricted Stock. The Restricted Stock is fully
vested subject to Forfeiture as provided in this Section 3.

(a) General Termination Forfeiture. Subject to Section 3(b) and Section 3(c),
the Restricted Stock shall be subject to Forfeiture as follows:

(i) As of the Effective Date, sixty percent (60%) of the Restricted Stock
constitutes Non-Forfeitable Shares;

(ii) forty percent (40%) of the Restricted Stock is Forfeited if a Termination
Event occurs after the Effective Date and prior to June 17, 2007;

(iii) twenty percent (20%) of the Restricted Stock is Forfeited if a Termination
Event occurs on or after June 17, 2007 and prior to June 17, 2008; and

(iv) zero percent (0%) of the Restricted Stock is Forfeited if a Termination
Event occurs on or after June 17, 2008.

(b) Change of Control Liquidity Event. Notwithstanding the provisions of
Section 3(a), upon the occurrence of a Change of Control Liquidity Event, one
hundred percent (100%) of the Restricted Stock shall constitute Non-Forfeitable
Shares.

(c) Forfeiture Upon Certain Termination Events.

(i) Notwithstanding Section 3(a), if the employment of the Management
Stockholder was terminated (A) by the Management Stockholder for Good Reason or
(B) by the Company without Cause (provided that the termination was not for
Performance Reasons), then only those shares of Restricted Stock that would not
be Non-Forfeitable Shares pursuant to Section 3(a) on the first anniversary of
the effective date of the Termination Event (as if such Termination Event
occurred on such first anniversary) will be Forfeited. However, if the
Termination Event was for Performance Reasons, the Management Stockholder shall
Forfeit those shares of Restricted Stock that are not Non-Forfeitable Shares on
the effective date of the Termination Event.

(ii) Notwithstanding Section 3(a), if the Termination Event was due to the
Management Stockholder’s death or disability, then upon such death or the
effective date of the Termination Event, as applicable, one hundred percent
(100%) of the Restricted Stock shall constitute Non-Forfeitable Shares.

(iii) Notwithstanding Section 3(a), if the employment or consultancy of the
Management Stockholder was terminated by any Company Entity for Cause, then all
of the shares of Restricted Stock that are not Non-Forfeitable Shares as of the
effective date of the Termination Event will be Forfeited on such date.

(d) Management Equity Incentive Pool. All shares of Common Stock which are
Forfeited by a Management Member pursuant to Section 3(a) or Section 3(c) (or
any successor sections of similar meaning) of an Amended and Restated Restricted
Stock Agreement will be added to the amount of equity incentives available to be
granted to senior management of the Company that are party to Amended and
Restated Restricted Stock Agreements.

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4. Dividends. The Management Stockholder will have all the rights of a
stockholder with respect to the Restricted Stock, including the right to receive
all ordinary cash dividends as the Board may pay with respect to the Common
Stock in accordance with the terms of the Company’s Certificate of
Incorporation.

5. Confidentiality. The Management Stockholder agrees that Confidential
Information was and shall be made available in connection with the Management
Stockholder’s employment by or consultancy with the Company Entities. The
Management Stockholder acknowledges that the Confidential Information that he or
she develops or invents in connection with his or her employment by or services
to a Company Entity or has obtained or will obtain in connection therewith is
the property of such Company Entity. The Management Stockholder agrees that he
or she will not disclose any Confidential Information to any other Person,
except that Confidential Information may be disclosed: (i) to the extent
required by applicable law, rule or regulation (including complying with any
oral or written questions, interrogatories, requests for information or
documents, subpoena, civil investigative demand or similar process to which the
Management Stockholder is subject); provided that the Management Stockholder
gives such Company Entity prompt notice of such requests, to the extent
practicable, so that such Company Entity may seek an appropriate protective
order or similar relief (and the Management Stockholder shall cooperate with
such efforts by such Company Entity at Company expense, and shall in any event
make only the minimum disclosure required by such law, rule or regulation unless
the Management Stockholder reasonably believes that other disclosure is
necessary or advisable in order to avoid adverse consequences to the Management
Stockholder), (ii) if the prior written consent of the Board shall have been
obtained, or (iii) to such Persons to the extent necessary in the reasonable
judgment of the Management Stockholder to perform his duties as an employee of
or consultant to a Company Entity and, in his reasonable judgment, such
disclosure is not harmful to the Company.

6. Restrictive Covenants.

(a) During the term of employment and for a period of one (1) year after the
effective date of the Termination Event (the “Non-Compete Period”) (i) the
Management Stockholder shall not, directly or indirectly, (A) alone or as a
partner, officer, director, shareholder, member, sole proprietor, employee or
consultant of any other firm or entity personally engage or participate in any
Restricted Business as a material portion of his or her responsibilities,
(B) cause, solicit, induce or encourage any employees, consultants or
contractors of the Company Entities to leave such employment or service, or
hire, employ or otherwise engage any such individual, or (C) cause, induce or
encourage any customer, supplier or licensor of the Company Entities, or any
other Person who has a material business relationship with the Company Entities,
to terminate or modify any such relationship.

(b) The parties hereto agree that, if any court of competent jurisdiction in a
final nonappealable judgment determines that a specified time period, a
specified business limitation or any other relevant feature of this Section 6 is
unreasonable, arbitrary or against public policy, then a lesser time period,
business limitation or other relevant feature which is determined to be
reasonable, not arbitrary and not against public policy may be enforced against
the applicable party.

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7. Conflicting Agreements. The Management Stockholder represents and agrees
that, except as provided in the Stockholders Agreement, he shall not, without
Board consent, (a) grant any proxy or enter into or agree to be bound by any
voting trust or agreement with respect to the Restricted Stock or (b) other than
the Management Stockholder’s employment agreement with the Company, enter into
any agreement or arrangement of any kind with any Person with respect to its
shares of Restricted Stock inconsistent with the provisions of this Agreement.

8. Specific Performance. The rights of the parties under this Agreement are
unique and, accordingly, the parties shall, in addition to such other remedies
as may be available to any of them at law or in equity, have the right to
enforce their rights hereunder by actions for specific performance to the extent
permitted by law.

9. Notices. All notices and other communications hereunder shall be given in
accordance with Section 7.02 of the Stockholders Agreement.

10. Custody; Legend. The certificates representing the Restricted Stock and
bearing such legends as may be required by the Company to evidence the
restrictions specified herein will be issued in the Management Stockholder’s
name but will be held in custody by the Company. The Management Stockholder
shall receive certificates representing the Restricted Stock at such time that
the shares of Restricted Stock have become Non-Forfeitable Shares. At such time
as the restrictions imposed by this Agreement are no longer applicable, the
legend referred to in the preceding sentence shall be removed.

11. Entire Agreement. The Equity Agreements, the Stockholders Agreement
(including any and all exhibits, schedules and other instruments contemplated
thereby) and the applicable provisions of the Incentive Plan constitute the
entire agreement among the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings between them or any of them as
to such subject matter; provided, however, in the event of a conflict between
the terms of the Equity Agreements and the Management Stockholder’s employment
agreement, the terms of the employment agreement shall prevail.

12. No Right To Continued Employment. The Equity Agreements are not a contract
of employment and the terms of the Management Stockholder’s employment or
service with the Company shall not be affected by, or construed to be affected
by, this Agreement, except to the extent specifically provided herein. Nothing
herein shall impose, or be construed as imposing, an obligation (i) on the part
of the Company to continue the Management Stockholder’s employment or service
with the Company or (ii) on the part of the Management Stockholder to remain in
the employ of or service to the Company.

13. Further Agreements. Each of the parties hereto agrees to execute all such
further instruments and documents and to take all such further action as any
other party may reasonably require in order to effectuate the terms and purposes
of the Equity Agreements.

14. Waiver and Amendment. Any of the provisions of this Agreement may be waived
by an instrument in writing executed by (i) the Company and (ii) the Management
Stockholder. This Agreement may not be amended except by an instrument in
writing executed by (i) the Company and (ii) the Management Stockholder.
Notwithstanding the foregoing, except as otherwise

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expressly set forth in the proviso in this sentence, in the event that
Management Members holding not less than sixty-six and two-thirds percent (66
 2/3%) of the Common Stock subject to Amended and Restated Restricted Stock
Agreements held by all such Management Members waive any provision of, or
execute an amendment to, their respective Amended and Restated Restricted Stock
Agreement (or such smaller percentage equal to 100% minus the aggregate
percentage of the Common Stock held by such notifying non-consenting Management
Members if fewer than four (4) Management Members notify the Company in writing
that they will not agree to such waiver or amendment after receiving notice of
the request for such waiver or amendment), the Management Stockholder hereby
agrees, upon the request therefor from the Company, to waive such provision or
execute such amendment to this Agreement on the same terms, provided that the
Management Stockholder shall not be required to waive or amend (i) any term of
this Agreement that would treat such Management Stockholder in an inconsistent
manner with respect to all other Management Members or (ii) any amendment to the
terms of Sections 3(a), 6 or this Section 14. Notwithstanding the foregoing, the
Company may amend this Agreement without the consent of the Management
Stockholder or any other Management Member to the extent that the Board in its
good faith judgment determines necessary to correct a manifest error in any term
hereof.

15. Assignment; Successors and Assigns. Except as otherwise expressly provided
herein, the Restricted Stock and the rights and obligations of the parties
herein may not be assigned without the prior written consent of the other party.
This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective heirs, executors, legal representatives,
successors and permitted assigns.

16. Severability. In case any one or more of the provisions contained in this
Agreement shall for any reason be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
any other provision of this Agreement and such invalid, illegal and
unenforceable provision shall be reformed and construed so that it will be
valid, legal, and enforceable to the maximum extent permitted by law.

17. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

18. Section Headings. The headings contained in this Agreement are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.

19. Governing Law. This Agreement shall be construed and enforced in accordance
with and governed by the internal laws of the State of Delaware.

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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the day
and year first above written.

 

NEWSTAR FINANCIAL, INC. By:   /s/ Timothy J. Conway Name: Timothy J. Conway
Title: President

SIGNATURE PAGE TO AMENDED AND RESTATED RESTRICTED STOCK AGREEMENT

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MANAGEMENT STOCKHOLDER: /s/ David R. Dobies

David R. Dobies

SIGNATURE PAGE TO AMENDED AND RESTATED RESTRICTED STOCK AGREEMENT

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SCHEDULE I

SCHEDULE OF RESTRICTED STOCK

 

MANAGEMENT STOCKHOLDER

  

RESTRICTED STOCK

David R. Dobies

   159,412 shares of Class A Common Stock which shall be 64,259 shares of Common
Stock after giving effect to the Reverse Stock Split and the Class A Conversion

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EXHIBIT A

See Attached

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NEWSTAR FINANCIAL, INC.

RSA Option Award Letter

Pursuant to this RSA Option Award Letter (the “Award Letter”), NewStar
Financial, Inc. hereby grants to you (the “Optionee”) the following option (the
“Option”) to purchase Common Stock. All capitalized terms used but not defined
herein shall have the meaning assigned to them in the Amended and Restated
Restricted Stock Agreement between you and the Company dated December 13, 2006
(the “Agreement”):

 

Name of Optionee:   

David R. Dobies

Total Number of shares of Common Stock Subject to this Option:    107,225
Exercise Price per share of Common Stock:    $ 17.00 Grant Date:    December 13,
2006 Vesting Commencement Date:    December 13, 2006 Vesting Schedule:    The
shares subject to this Option shall vest according to the following schedule:
(i) 60% upon the Effective Date and (ii) 10% on each anniversary of the
Effective Date for each of the four years following the Effective Date. Date
Exerciseable:    This Option may be exercised to the extent the shares subject
to this Option have vested at any time after the Grant Date. Acceleration:   
Upon the occurrence of a Change of Control Liquidity Event or upon termination
of the Optionee for death or disability, one hundred percent (100%) of the
shares subject to this Option shall automatically vest.

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Effect of Termination:   

If the employment of the Optionee was terminated (A) by the Optionee for Good
Reason or (B) by the Company without Cause (provided that the termination was
not for Performance Reasons), then the shares subject to this Option shall
continue to vest for one (1) year following the date of the Termination Event.
Any shares that have not vested by the one year anniversary of the date of the
Termination Event shall be cancelled and of no further effect.

If the employment of the Optionee was terminated by the Company for Cause or for
Performance Reasons, then all shares subject to this Option shall cease vesting
on the date of the Termination Event. Any shares that have not vested on the
date of the Termination Event shall be cancelled and of no further effect.

Expiration Date:    This option shall expire ten (10) years from the Grant Date,
unless earlier terminated as described below. Expiration of Option Upon
Termination:   

Except as otherwise extended by the Board, upon the termination of the service
of the Optionee, this Option shall expire on the earliest of the following
occasions:

 

(i) subject to clause (iv), the date that is three months after the voluntary
termination of the Optionee’s service or the termination of the Optionee’s
service by the Company (or by an Subsidiary) other than for Cause;

 

(ii) the date of the termination of the Optionee’s service by the Company (or by
an Subsidiary) for Cause;

 

(iii) the date one year after the termination of the Optionee’s service by
reason of Optionee’s death or disability; or

 

(iv) in the case of a Change of Control Liquidity Event, the Expiration Date.

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Other Terms:    Additional terms of this Option are set forth in the General
Terms attached hereto. Conflicting Terms:    In the event of a conflict between
the terms of this Award Letter and the Optionee’s employment agreement, the
terms of the employment agreement shall prevail.

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By your signature and the signature of the Company’s representative below, you
and the Company agree that this Option is granted under and governed by the
terms of the Agreement, the 2006 Incentive Plan of the Company (to the extent
set forth in the Agreement) and the General Terms.

 

OPTIONEE:     NEWSTAR FINANCIAL, INC.        By:      Name: David R. Dobies    
Name:   Timothy J. Conway Address:          Title:   President

SIGANATURE PAGE TO RSA OPTION GRANT

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NEWSTAR FINANCIAL, INC.

RSA Option Award

General Terms

1. Type of Option. This Option is intended to qualify as a Non-Qualified Stock
Option.

(a) Vesting of Option if Service Continues. If the Optionee’s service to the
Company has continued through the periods set forth in the Vesting Schedule set
forth in the Award Letter, the Optionee may exercise the Option for such number
of Shares as have become exercisable pursuant to such schedule. Notwithstanding
the foregoing, the Committee may, in its discretion, accelerate the date on
which any portion of the Option becomes exercisable, subject to the requirements
of section 409A of the Code. The foregoing rights are cumulative and may be
exercised only before the expiration date set forth in the Award Letter.

(b) Purpose and Waiver. The purpose of this Option is to encourage the Optionee
to enter into and/or maintain a continuing and long-term relationship with the
Company. It is not a purpose of this Option to reward the Optionee for the
completion of any specific project or of any discrete period of service which
may fall between consecutive vesting periods of this Option. By signing the
Award Letter, the Optionee hereby waives any claims to any Shares that have not
become exercisable pursuant to Section 1(a) as of the date of the termination of
the Optionee’s service to the Company and Shares that are subject to repurchase
upon the exercise of the Repurchase Option (as defined herein).

2. Exercise.

(a) General. Within the limits set forth in Section 1 above, the Option may be
exercised from time to time with respect to all or any part of the Shares as to
which it is exercisable at the time; provided, however, that the Option may not
be exercised as to less than 10% of the total number of Shares subject to this
Option at any one time, except with respect to the remaining Shares then
purchasable under the Option, if less than 10% of such total number of Shares
remain. Shares purchased upon exercise of this Option will be subject to
restrictions on transfer. In addition, the exercise of the Option shall be
subject to satisfaction of all conditions the Committee may impose on the
exercise of the Option pursuant to the Award Letter or the Agreement, and any
such exercise shall be effective only after all such conditions have been
satisfied.

(b) Deliveries. To exercise the Option, the Optionee (or other person exercising
the Option) must deliver to the Company the following:

(i) a completed and signed Notice of Stock Option Exercise, in the form of
Attachment A hereto (the “Exercise Notice”). If the Option is being exercised by
a person other than the Optionee, the Exercise Notice must be accompanied by
proof of the right of such person to exercise the Option and such other
pertinent information as the Company deems necessary;

(ii) payment in full of the aggregate Exercise Price of the Shares being
purchased:

(1) in cash or by check made payable to the order of the Company;

(2) subject to Section 2(c), below, by delivery of shares of Common Stock having
an aggregate Fair Market Value on the date of exercise equal to the aggregate
Exercise Price;

(3) subject to Section 2(c), below, if previously approved by the Committee, by
a combination of cash, check and/or shares of Common Stock; or

SIGANATURE PAGE TO RSA OPTION GRANT

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(4) if the Common Stock is then traded on a national securities exchange or on
the NASDAQ National Market (or successor trading system), by delivery of an
irrevocable undertaking, satisfactory in form and substance to the Company, by a
creditworthy securities broker to sell such Shares and to deliver promptly to
the Company sufficient funds to pay the aggregate Exercise Price and any
applicable withholding taxes, or delivery by the Optionee to the Company of a
copy of irrevocable instructions, satisfactory in form and substance to the
Company, to a creditworthy securities broker to sell such Shares and to deliver
promptly to the Company sufficient funds to pay the aggregate Exercise Price and
any applicable withholding or employment taxes; or

(5) if the Common Stock is then traded on a national securities exchange or on
the NASDAQ National Market (or successor trading system), by delivery by the
Optionee to the Company of a copy of irrevocable instructions, satisfactory in
form and substance to the Company, to pledge such Shares to a securities broker
or lender approved by the Company as security for a loan, and to deliver
promptly to the Company sufficient funds to pay the aggregate Exercise Price and
any applicable withholding or employment taxes.

(c) Limitations on Payment by Delivery of Common Stock. If clause (2) or (4) of
Section 2(b)(ii) is applicable, and if the Optionee wishes to deliver shares of
Common Stock held by the Optionee (“Old Stock”) to the Company in full or
partial payment of the aggregate Exercise Price, then:

(i) the certificate or certificates representing such Old Stock shall be duly
endorsed for transfer to the Company and such Old Stock shall be free of all
transfer restrictions, liens, encumbrances and other legal or equitable
interests;

(ii) if the Old Stock so delivered is subject to restrictions or limitations
imposed by agreement between the Optionee and the Company, an equivalent number
of Shares shall be subject to all restrictions and limitations applicable to the
Old Stock to the extent that the Optionee paid for the Shares by delivery of Old
Stock, in addition to any restrictions or limitations imposed by the Equity
Agreements; and

(iii) notwithstanding any provision of the Equity Agreements to the contrary,
the Optionee may not pay any part of the aggregate Exercise Price hereof by
transferring Old Stock to the Company (A) unless such Old Stock has been owned
by the Optionee free of any substantial risk of forfeiture for at least six
(6) months and (B) the Committee determines that payment of the aggregate
Exercise Price by delivery of such Old Stock will not result in a charge to
earnings for financial accounting purposes.

(d) Share Certificate(s).

(i) Delivery. Subject to Section 2(e), below, the Company shall deliver a
certificate or certificates representing the Shares to the transfer agent of the
Company, as custodian (the “Custodian”) as soon as practicable after receipt of
the deliveries specified in Section 2(b), above. Such certificate or
certificates shall be registered in the name of the person or persons so
exercising this Option. The certificate or certificates so delivered to the
Custodian shall be held by the Custodian for the benefit and in favor of the
Optionee, subject to the provisions of this Section 2(d). Notwithstanding the
escrow, the Optionee shall retain the right to vote and enjoy all other rights
and incidents of ownership of the Shares represented by said certificates. The
Custodian shall issue a receipt to the Optionee evidencing the delivery of the
stock certificates and transfer powers. The Custodian shall arrange to keep any
stock certificates and stock transfer powers delivered to him under this
Section 2(d) in a secure place and shall keep true and accurate records of all
such certificates and powers.

(ii) Concerning the Custodian. The Company shall indemnify and hold harmless the
Custodian against any and all costs or expenses (including attorneys’ fees
expenses), judgments, fines, losses, claims, damages, liabilities and amounts
paid in settlement in connection with any claim, action, suit, proceeding or
investigation arising out of or pertaining to this Award Letter. Any person
succeeding to the office of Treasurer shall succeed to and assume the rights and
obligations of Custodian hereunder.

 

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(e) Legal and Regulatory Matters. No Shares shall be issued upon the exercise of
this Option unless and until the Company has determined in its sole discretion
that:

(i) The Company and the Optionee have taken all actions required to register the
Shares under the Securities Act of 1933, as amended, or any successor statute
(the “Securities Act”), or to perfect an exemption from the registration
requirements of the Securities Act;

(ii) Any applicable listing requirements of any stock exchange or other
securities market on which the Common Stock is listed have been satisfied; and

(iii) All other applicable provisions of federal and state law have been
satisfied.

(f) The Company may require, as a condition to the exercise of this Option, that
Optionee agree to be bound by certain provisions specified by the Company, in
addition to the provisions of Sections 4 and 5 hereof.

3. No Rights as Shareholder. The Optionee (or any other person entitled to
exercise the Option) shall not be entitled to any rights as a shareholder of the
Company with respect to any Shares issuable upon exercise of this Option until
such Shares shall have been registered on the stock transfer books of the
Company in the name of the Optionee (or such other person).

4. Restrictions on Transfer.

(a) No Transfer of Options. This Option is not transferable by the Optionee
except to a Permitted Transferee.

(b) No Transfer of Shares. The Optionee shall not sell, assign, transfer,
pledge, hypothecate or otherwise dispose of, by operation of law or otherwise
(collectively “transfer”), any of the Shares, or any interest therein, unless
such transfer is made in compliance with the provisions of the Equity Agreements
and the Stockholders Agreement.

(c) Condition to Transfers to Permitted Transfers. It shall be a condition of
transfer to a Permitted Transferee that (i) the transferee agrees to be bound by
the terms of the Equity Agreements and (ii) the Optionee has complied with all
applicable laws in connection with such transfer.

(d) Effect of Prohibited Transfer of Shares. Any transfer of Shares in violation
of this Award Letter shall be void. The Company shall not be required (i) to
transfer on its books any of the Shares which shall have been transferred in
violation of this Award Letter or (ii) to treat as the owner of such Shares or
pay dividends to any transferee to whom any such Shares shall have been so
transferred.

5. Securities Law Restrictions on Resale.

(a) Optionee’s Representations and Agreements. The Optionee represents and
agrees that (i) unless and until registered under the Securities Act, the Shares
will be of an illiquid nature and will be deemed to be “restricted securities”
for purposes of the Securities Act; (ii) the Shares to be acquired upon
exercising this Option will be acquired for investment, and not with a view to
the sale or distribution thereof, and (iii) such Shares may not be sold except
in compliance with the registration requirements of the Securities Act or an
exemption therefrom.

(b) Legends on Certificates. Unless the Shares have been registered under the
Securities Act, each certificate evidencing any of the Shares shall bear a
legend referring to the restrictions on transfer imposed by the Securities Act,
and any applicable state securities laws, as well as a legend to the following
effect:

“THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS
UPON TRANSFER AND MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED, HYPOTHECATED
OR OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH AND SUBJECT TO ALL OF THE
TERMS AND

 

3

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CONDITIONS OF A CERTAIN STOCK OPTION AWARD LETTER BETWEEN THE COMPANY AND THE
REGISTERED OWNER OF THIS CERTIFICATE. THE COMPANY WILL FURNISH A COPY OF SUCH
AWARD LETTER TO THE HOLDER OF THIS CERTIFICATE UPON WRITTEN REQUEST AND WITHOUT
CHARGE.”

(c) Removal of Legends. If, in the opinion of counsel to the Company, any legend
placed on a stock certificate representing Shares issued under this Award Letter
is no longer required, then the holder of such certificate shall be entitled to
exchange such certificate for a certificate representing the same number of
Shares but without such legend.

(d) Lock-up Agreement. The Optionee agrees that, in the event that the Company
effects any underwritten public offering of Common Stock registered under the
Securities Act, neither the Shares nor any interest in the Shares may be sold,
offered for sale, pledged or otherwise disposed of, directly or indirectly
(including through the granting of options or any hedging transactions), without
the prior written consent of the managing underwriter(s) of the offering, for
the same period of time after the execution of an underwriting agreement in
connection with such offering, and on the same terms, that all of the Company’s
then directors and executive officers agree to be restricted.

6. No Retention Rights. Nothing in the Award Letter or the Agreement confers
upon the Optionee any right to continue in the service of the Company for any
period of specific duration or shall be construed to interfere with or otherwise
restrict in any way the rights of the Company or of the Optionee, which rights
are expressly reserved by each, to terminate the Optionee’s service at any time
and for any reason, with or without cause.

7. Taxes. As a condition to the issuance of Shares upon exercise of this Option,
the Optionee hereby agrees that, if the Company in its discretion determines
that it is or could be obligated to withhold any tax in connection with the
exercise of this Option, or in connection with the transfer of, or the lapse of
restrictions on, any Shares or other property acquired pursuant to the Option,
the Company may, in its discretion, withhold the appropriate amount of tax
(a) in cash from the Optionee’s wages or other remuneration or (b) in kind from
the Shares or other property otherwise deliverable to the Optionee on exercise
of this Option. The Optionee further agrees that, if the Company does not
withhold an amount sufficient to satisfy the withholding obligation of the
Company, the Optionee will on demand, and as a condition to the issuance of
Shares upon the exercise of this Option, make reimbursement in cash for the
amount underwithheld or, if permitted by the Committee, provide such cash or
other security as the Committee deems adequate to meet the liability or
potential liability of the Company for the withholding of tax, and to augment
such cash or other security from time to time in any amount reasonably deemed
necessary by the Committee to preserve the adequacy of such cash or other
security.

8. Amendments. The Committee may at any time or times amend the Option granted
hereunder for the purpose of satisfying the requirements of any changes in
applicable laws or regulations or for any other purpose which at the time may be
permitted by law. Except for amendments described in the foregoing sentence
necessary to comply with applicable laws and regulations, no termination,
amendment of the Option or the Award Letter shall, without the Optionee’s
consent, materially adversely affect the Optionee’s rights under the Option or
the Award Letter. Notwithstanding the foregoing, this Award Letter shall be
amended as required by Section 10(h) below to the extent required by regulatory
or statutory guidance.

9. Adjustments for Stock Splits, Stock Dividends, Etc. If from time to time
while the Shares subject to this Option remain outstanding there is any stock
split-up, stock dividend, stock distribution or other reclassification of the
Common Stock of the Company, (a) any and all new, substituted or additional
securities to which the Optionee is entitled by reason of his ownership of
Shares shall be immediately subject to the restrictions on transfer and other
provisions of the Equity Agreements in the same manner and to the same extent as
such Shares and (b) appropriate adjustment shall be made to the Exercise Price,
subject to compliance with section 409A of the Code, if applicable. No
adjustment shall be made for dividends or similar rights for which the record
date is prior to the date of exercise.

 

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10. Miscellaneous.

(a) Subject to Agreement. The Optionee acknowledges that this Option is subject
to the terms and conditions of the Agreement and of the Incentive Plan (to the
extent set forth in the Agreement).

(b) Severability; Governing Law. If any provisions of this Award Letter shall be
determined to be illegal or unenforceable by any court of law, the remaining
provisions shall be severable and enforceable in accordance with their terms.
This Award Letter shall be governed by, and construed in accordance with, the
internal laws of Delaware, without giving effect to the principles of the
conflicts of laws thereof.

(c) Injunctive Relief. It is acknowledged that it will be impossible to measure
the damages that would be suffered by the Company if the Optionee fails to
comply with the provisions of this Award Letter and that, in the event of any
such failure, the Company will not have an adequate remedy at law. The Company
shall, therefore, be entitled to obtain specific performance of each of the
Optionee’s obligations hereunder and to obtain immediate injunctive relief. The
Optionee shall not urge, as a defense to any proceeding for such specific
performance or injunctive relief, that the Company has an adequate remedy at
law.

(d) Binding Effect. This Award Letter shall be binding upon and inure to the
benefit of the parties and their respective heirs, executors, administrators,
successors and permitted assigns.

(e) Notices. All notices required or permitted hereunder shall be in writing and
be effective upon personal delivery, upon deposit with the United States Post
Office, by registered or certified mail, postage prepaid, or upon deposit with a
recognized express overnight courier service, addressed, if to the Company, to
its principal executive office at the time, Attention: President, and if to the
Optionee, to the address shown beneath his or her signature on the signature
page of this Award Letter, or at such other address or addresses as either party
shall designate to the other in accordance with this Section 10(e).

(f) Entire Agreement. This Award Letter, together with the Agreement and as
applicable, the Incentive Plan, constitute the entire agreement between the
parties hereto pertaining to the subject matter hereof and supersedes all prior
and contemporaneous agreements and understandings, whether oral or written, of
the parties hereto concerning the subject matter hereof.

(g) Waivers. Any provision contained in this Award Letter may be waived, either
generally or in any particular instance, by the Committee or by an Optionee, but
no such waiver by the Committee shall operate to the detriment of the Optionee
without the Optionee’s consent.

(h) Statutory Requirements and Subsequent Amendment. This Award Letter and the
grant of any Option hereunder is intended, to the extent applicable, to
constitute good faith compliance with the requirements of the American Jobs
Creation Act, specifically with respect to the definition of deferred
compensation and the provisions of section 409A of the Code. To the extent
required by subsequent guidance, whether statutory or regulatory, the Company
and Optionee agree that any Option granted hereunder may be modified, rescinded
or substituted by the Company with an award of comparable economic value as
required to maintain compliance with the provisions of section 409A of the Code.

 

5

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Attachment A

Notice of Stock Option Exercise

(To be completed and signed only on exercise of Option)

I hereby exercise the stock option (the “Option”) granted by NewStar Financial,
Inc. (the “Company”) to me on             , subject to all the terms and
provisions thereof as contained in the RSA Option Award Letter of the same date
signed by me concerning such Option (the “Award Letter”) and the Amended and
Restated Restricted Stock Agreement (the “Agreement”), and notify you of my
desire to purchase             Shares pursuant to the Option.

Enclosed is my check in the sum of $             in full payment for such Shares
and applicable withholding and employment taxes.

I have been made aware of and understand that a holder of Non-Qualified Stock
Options will be taxed upon the holder’s exercising his/her options, and may be
subject to withholding.

I understand that all taxes relating to the exercise of these options are my
responsibility alone, and have sought advice from my tax advisor as I determined
appropriate.

I hereby confirm to the Company each of my representations, covenants and
agreements in the Award Letter and the Agreement.

All capitalized terms in this Notice of Stock Option Exercise have the meanings
set forth in the Award Letter or in the Agreement, as the case may be.

DATED:_________________

Signature:           Name:     

SIGANATURE PAGE TO RSA OPTION GRANT