EXHIBIT 10.2
 
PREEMPTIVE AND REGISTRATION RIGHTS AGREEMENT
 
THIS PREEMPTIVE AND REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is entered
into as of November 26, 2007 by and among PrivateBancorp, Inc., a Delaware
corporation (the “Company”), and the persons listed on the signature page hereof
(referred to collectively herein, and including the Institutional Investor (as
defined below), as the “Investors” and each individually as an “Investor”).
 
RECITALS
 
WHEREAS, this Agreement is made pursuant to the Stock Purchase Agreement (the
“Stock Purchase Agreement”), dated as of November 26, 2007, by and among the
Company and certain purchasers of shares of the Company’s common stock and the
Company’s Series A Junior Nonvoting Preferred Stock (the “Series A Stock”)
thereunder, including the Investors.
 
WHEREAS, pursuant to the Stock Purchase Agreement, (a) each of the Investors has
agreed to purchase from the Company pursuant to a private placement offering by
the Company of shares of its Common Stock, no par value (the “Common Stock”)
and/or shares of its Series A Stock (together with the Common Stock, the
“Shares”), and (b) the Company will issue the Shares to the Investors in
accordance therewith; and
 
WHEREAS, in connection with the consummation of the transactions contemplated by
the Stock Purchase Agreement, the parties desire to enter into this Agreement in
order to grant certain registration rights to the Investors, and certain
preemptive rights to the Institutional Investor, as set forth below.
 
NOW, THEREFORE, in consideration of the foregoing premises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
 
SECTION 1         GENERAL
 
1.1           Definitions.  As used in this Agreement, the following terms shall
have the following respective meanings:
 
“Affiliate” of any particular Person means any other Person controlling,
controlled by or under common control with such particular person or
entity.  For purposes of clarification GTCR Fund IX/A, L.P., a Delaware limited
partnership, GTCR Fund IX/B, L.P., a Delaware limited partnership and GTCR
Co-Invest III, L.P., a Delaware limited partnership, shall be deemed to be
Affiliates.
 
“Common Stock” means shares of common stock, no par value per share, of the
Company.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended, or similar
federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect at the time.
 

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“Form S-3” means such form under the Securities Act as in effect on the date
hereof or any successor or similar registration form under the Securities Act
subsequently adopted by the SEC which permits inclusion or incorporation of
substantial information by reference to other documents filed by the Company
with the SEC.
 
“Holder” means any Investor, including the Institutional Investor and its
Affiliates, who holds Registrable Securities and any holder of Registrable
Securities to whom the registration rights conferred by this Agreement have been
transferred in compliance with Section 2.10 hereof.
 
“Institutional Investor” means GTCR Fund IX/A, L.P., a Delaware limited
partnership.
 
“Institutional Investor Percentage Interest” means the aggregate percentage
beneficial ownership of the Institutional Investor and its Affiliates of the
Company’s outstanding shares of Common Stock on the date of determination
(assuming conversion of the Series A Stock).
 
“Lock-up Agreement” has the meaning assigned thereto in Section 5.2 of the Stock
Purchase Agreement.
 
“New Stock” means Common Stock or Series A Stock, or securities convertible into
or exchangeable for Common Stock of the Company or which have voting rights or
participation features with Common Stock of the Company, offered in a public or
nonpublic offering by the Company.
 
“Person” means any individual, corporation, partnership, joint venture, limited
liability company, business trust, joint stock company, trust or unincorporated
organization or any government or any agency or political subdivision thereof.
 
“Qualified Equity Offering” means a public or nonpublic offering of Common Stock
or Series A Stock, or securities convertible into or exchangeable for Common
Stock of the Company or which have voting rights or participation features with
Common Stock of the Company (collectively, “New Stock”) solely for cash and not
pursuant to a Special Registration; provided, however, that none of the
following offerings shall constitute a Qualified Equity Offering:  (a) any
offering pursuant to any stock purchase plan, stock ownership plan, stock option
or equity compensation plan or other similar plan where stock is being issued or
offered to a trust, other entity or otherwise, to or for the benefit of any
employees, potential employees, officers or directors of the Company, or (b) any
offering made as consideration pursuant to an acquisition (whether structured as
a merger or otherwise), a partnership or joint venture or strategic alliance or
investment by the Company or similar non-capital raising transaction (but not an
offering to raise capital to fund an acquisition).
 
“Register,” “registered,” and “registration” shall refer to a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act and applicable rules and regulations thereunder, and the
declaration or ordering of effectiveness of such registration statement.
 
“Registrable Securities” means (a) Shares of Common Stock; (b) any shares of
Common Stock issued or issuable upon the conversion of any Series A Stock issued
pursuant to
 

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the Stock Purchase Agreement; (c) any other shares of Common Stock held by the
Holders; and (d) any Common Stock of the Company issued as (or issuable upon the
conversion or exercise of any warrant, right, preferred stock or other security
which is issued as) a dividend or other distribution with respect to, or in
exchange for or in replacement of, the Shares or any other shares of Common
Stock held by the Holders, provided, however, that Registrable Securities shall
not include any shares of Common Stock which have been sold to the public by a
Holder either pursuant to a registration statement or Rule 144 under the
Securities Act, or which have been sold in a private transaction in which the
transferor’s rights under this Agreement are not assigned.
 
“Registrable Securities then outstanding” shall be the number of shares
determined by calculating the total number of shares of the Company’s Common
Stock that are Registrable Securities and either (a) are then issued and
outstanding or (b) are issuable pursuant to exercisable or convertible
securities (including Series A Stock).
 
“Registration Expenses” shall mean all expenses incurred by the Company in
effecting any registration pursuant to this Agreement (including any Mandatory
Registration or Shelf Registration), including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel for the Company, blue sky fees and expenses, and expenses of the
Company’s independent accountants in connection with any regular or special
reviews or audits incident to or required by any such registration, and fees and
expenses of underwriters (excluding discounts and commissions) and any other
Persons retained by the Company, but shall not include Selling Expenses, certain
fees and disbursements of counsel for the Holders (except as set forth below)
and the compensation of regular employees of the Company, which shall be paid in
any event by the Company.  Notwithstanding the foregoing, Registration Expenses
shall include the reasonable, documented, fees and expenses of one counsel
chosen by the holders of a majority of the Registrable Securities covered by
such registration for such counsel rendering services customarily performed by
counsel for selling stockholders that are submitted to the Company in writing.
 
“SEC” or “Commission” means the Securities and Exchange Commission and any
successor agency.
 
“Securities Act” shall mean the Securities Act of 1933, as amended, or similar
federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect at the time.
 
“Selling Expenses” shall mean all underwriting discounts, selling commissions
and stock transfer taxes applicable to the sale of Registrable Securities and
fees and disbursements of counsel for any Holder (other than the fees and
disbursements of counsel included in Registration Expenses).
 
“Series A Stock” means the Company’s Series A Junior Nonvoting Preferred Stock.
 
“Shares” mean shares of Common Stock and/or Series A Stock issued by the Company
to the Investors pursuant to the Stock Purchase Agreement.
 

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“Special Registration” means the registration of (a) equity securities and/or
options or other rights in respect thereof solely registered on Form S-4 or
Form S-8 (or successor forms) or (b) shares of equity securities and/or options
or other rights in respect thereof to be offered to directors, management,
employees, potential employees, consultants, customers, lenders or vendors of
the Company or its direct or indirect subsidiaries or in connection with
dividend reinvestment plans.
 
SECTION 2          REGISTRATION
 
2.1           Demand Registration and Shelf Registration.
 
(a)           Subject to the conditions of this Section 2.1 and the terms and
conditions of the Lock-up Agreement, if the Company shall receive a written
request from (1) the Institutional Investor, so long as the Institutional
Investor and its Affiliates hold at least 25% of the Shares (determined on an as
converted to Common Stock basis) held by the Institutional Investor and its
Affiliates as of the date hereof or (2) , in the event the Institutional
Investor and its Affiliates do not hold at least 25% of the Shares (determined
on an as converted to Common Stock basis) held by the Institutional Investor and
its Affiliates as of the date hereof, then the Holders of at least fifty percent
(50%) of the Registrable Securities (the “Initiating Holders”) that the Company
file a registration statement under the Securities Act covering the registration
of at least twenty-five percent (25%) of the Registrable Securities then
outstanding (or a lesser percent if the anticipated aggregate offering price,
net of underwriting discounts and commissions, would exceed $50,000,000), then
the Company shall, within ten (10) days of the receipt thereof, give written
notice of such request to all Holders, and subject to the limitations of this
Section 2.1, effect, as expeditiously as reasonably possible, the registration
under the Securities Act of all Registrable Securities that either the Holders
request to be registered.
 
(b)           The Company shall use its reasonable best efforts to file with the
SEC a registration statement on the applicable SEC form with respect to the
resale from time to time, whether underwritten or otherwise, of the Registrable
Securities by the holders thereof within nine months after the date hereof.  The
Company shall use its reasonable best efforts to respond to all SEC comments
related to such registration statement within 20 calendar days of the receipt
thereof, and shall use its reasonable best efforts to cause such registration
statement to be declared effective by the SEC within twelve months after the
date hereof.  The Company shall use its reasonable best efforts to maintain the
effectiveness of the registration effected pursuant to this Section 2.1(b) at
all times, subject only to the limitations on effectiveness set forth in
Section 2.5 below.  The registration contemplated by this Section 2.1(b) is
referred to herein as the “Mandatory Registration.”  The Mandatory Registration
shall be filed with the SEC in accordance with and pursuant to Rule 415
promulgated under the Securities Act (or any successor rule then in effect) (a
“Shelf Registration”).  So long as any such Shelf Registration is effective as
required herein and in compliance with the Securities Act and is usable for
resale of Registrable Securities, the Institutional Investor or the holders of
at least 50% of the Registrable Securities shall be entitled to demand any
number of draw-downs (including underwritten draw-downs, provided that the
anticipated aggregate offering value of the Registrable Securities requested to
be included in such underwritten draw-down must equal at least twenty-five
percent (25%) of the Registrable Securities then outstanding (or a lesser
percent if the anticipated aggregate offering price, net of underwriting
discounts and commissions, would exceed
 

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$25,000,000)) from the shelf and, in connection with any such draw-down, the
Company shall take all customary and reasonable actions that the Company would
take in connection with an underwritten registration pursuant to Section 2.1(a)
or Section 2.3 (including, without limitation, all actions referred to in
Section 2.5 necessary to effectuate such sale in the manner determined by the
holders of at least a majority of the Registrable Securities to be included in
such underwritten draw-down).  The Company shall use its reasonable efforts to
cause the registration statement or statements filed on Form S-3 or any similar
short-form registration as the Company may elect to remain effective until such
date (the “Shelf Termination Date”) as is the earlier of (i) the date on which
all Registrable Securities included in the registration statement shall have
been sold or shall have otherwise ceased to be Registrable Securities and
(ii) the date on which all remaining Registrable Securities may be sold during
any ninety (90) day period without any restriction pursuant to Rule 144 under
the Securities Act, other than Rule 144(k), after taking into account any
Holders’ status as an affiliate of the Company as determined by the counsel to
the Company pursuant to a written opinion letter addressed to the Company’s
transfer agent to such effect.  In the event the Mandatory Registration must be
effected on Form S-1 or any similar long-form registration as the Company may
elect, such registration shall nonetheless be filed as a Shelf Registration and
the Company shall use its commercially reasonable efforts to keep such
registration current and effective, including by filing periodic post-effective
amendments to update the financial statements contained in such registration
statement in accordance with Regulation S-X promulgated under the Securities Act
until the Shelf Termination Date.  The Company shall not include in the
Mandatory Registration any securities which are not Registrable Securities
without the prior written consent of the holders of at least a majority of the
Registrable Securities included in such registration.
 
(c)           If the Institutional Investor or the Initiating Holders, as the
case may be, intend to distribute the Registrable Securities covered by their
request by means of an underwriting or any underwritten takedown off the
registration statement filed pursuant to the Mandatory Registration, they shall
so advise the Company as a part of their request made pursuant to this
Section 2.1 or any request pursuant to Section 2.3 and the Company shall include
such information in the written notice referred to in Section 2.1(a),
Section 2.1(b) or Section 2.3(a), as applicable.  In such event, the right of
any Holder to include such Holder’s Registrable Securities in such registration
or underwritten takedown off the registration statement filed pursuant to the
Mandatory Registration shall be conditioned upon such Holder’s participation in
such underwriting and the inclusion of such Holder’s Registrable Securities in
the underwriting to the extent provided herein.  All Holders proposing to
distribute their securities through such underwriting shall enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting by the Company and reasonably acceptable to the
Institutional Investor, so long as the Institutional Investor and its Affiliates
hold at least 25% of the Shares (determined on an as converted to Common Stock
basis) held by the Institutional Investor and its Affiliates as of the date
hereof, and, in the event the Institutional Investor and its Affiliates do not
hold at least 25% of the Shares (determined on an as converted to Common Stock
basis) held by the Institutional Investor and its Affiliates as of the date
hereof, then the Holders of a majority of the Registrable Securities; provided
that no holder of Registrable Securities included in any underwritten
registration or underwritten takedown off the registration statement filed
pursuant to the Mandatory Registration shall be required to make any
representations or warranties to the Company or the underwriters (other than
representations and warranties regarding such holder, such holder’s title to the
securities and
 

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such holder’s intended method of distribution) or, without the consent of the
Institutional Investor, to undertake any indemnification obligations to the
Company or the underwriters with respect thereto, except as otherwise provided
in Section 2.9 below.
 
Notwithstanding any other provision of this Section 2.1 or Section 2.3, if the
underwriter advises the Company that marketing factors require a limitation of
the number of securities to be underwritten (including Registrable Securities)
then the Company shall so advise all Holders of Registrable Securities which
would otherwise be underwritten pursuant hereto, and the number of shares that
may be included in the underwriting shall be allocated to the Holders of such
Registrable Securities on a pro rata basis based on the number of Registrable
Securities held by all such Holders (including the Initiating Holders).  Any
Registrable Securities excluded or withdrawn from such underwriting shall be
withdrawn from the registration.
 
(d)           The Company shall not be required to effect a registration
pursuant to this Section 2.1 other than the Mandatory Registration pursuant to
Section 2.1(b) above:  (i) prior to the first anniversary date on the Closing
Date (as defined in the Stock Purchase Agreement); (ii) after the Company has
effected two (2) registrations pursuant to this Section 2.1, and such
registration has been declared or ordered effective and kept effective by the
Company as required by Section 2.5(a) of this Agreement and at least fifty
percent (50%) of the Registrable Securities thereby are sold; (iii) during the
period starting with the date thirty (30) days prior to the Company’s good faith
estimate of the date of filing of, and ending on a date ninety (90) days after
the effective date of, a Company-initiated registration; provided that the
Company is actively employing in good faith all reasonable efforts to cause such
registration statement to become effective; (iv) if the Company shall furnish to
the Institutional Investor and the Holders requesting a registration statement
pursuant to this Section 2.1, a certificate signed by the Chairman of the Board
stating that in the good faith and reasonable judgment of the Board of Directors
of the Company, the anticipated offering would be seriously detrimental to the
Company and its stockholders for such registration statement to be effected at
such time (but excluding any detriment to the Company solely as a result of its
impact on the share price), in which event the Company shall have the right to
defer such filing for a period of not more than ninety (90) days after receipt
of the request of the Institutional Investor or Initiating Holders; provided
that such right to delay a request shall be exercised by the Company not more
than twice in any twelve (12) month period; or (v) if the Institutional Investor
or Initiating Holders propose to dispose of shares of Registrable Securities
that may be immediately registered on Form S-3 pursuant to a request made
pursuant to Section 2.3 below.  Notwithstanding the foregoing, any expenses in
connection with such registration or attempted registration shall be
Registration Expenses.
 
(e)           The Company may include in any such registration other securities
for sale for its own account or for the account of any other Person; provided
that, if the underwriter for the offering shall determine that the number of
shares proposed to be offered in such offering would be reasonably likely to
adversely affect such offering, then the securities to be sold by the
Institutional Investor and/or the Holders shall be included in such registration
before any securities proposed to be sold for the account of the Company or any
other Person.
 
(f)           The Company shall not grant to any other Person the right to
request the Company (i) to register any shares of Common Stock in a demand
registration unless such rights
 

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are consistent with the provisions hereof, or (ii) to register any securities of
the Company (other than shares of Common Stock) in a demand registration.
 
2.2           Piggyback Registrations.
 
(a)           Subject to the terms and conditions of the Lock-up Agreement, the
Company shall notify each Investor who holds, and all Holders of, Registrable
Securities in writing at least ten (10) days prior to the filing of any
registration statement under the Securities Act for purposes of a public
offering of securities of the Company (whether in connection with a public
offering of securities by the Company, a public offering of securities by
shareholders of the Company, or both, but excluding a registration relating
solely to employee benefit plans, or a registration relating to a corporate
reorganization or other transaction on Form S-4, or a registration on any
registration form that does not permit secondary sales) and will afford each
such Investor and/or Holder an opportunity to include in such registration
statement all or part of such Registrable Securities held by such Investor
and/or Holder as set forth herein.  Each Investor and/or Holder desiring to
include in any such registration statement all or any part of the Registrable
Securities held by such Investor and/or Holder shall, within five (5) days after
the above-described notice from the Company, so notify the Company in
writing.  Such notice shall state the intended method of disposition of the
Registrable Securities by such Investor and/or Holder as set forth herein.  If
an Investor and/or Holder decides not to include all of its Registrable
Securities in any registration statement thereafter filed by the Company, such
Investor or Holder shall nevertheless continue to have the right to include any
Registrable Securities in any subsequent registration statement or registration
statements as may be filed by the Company with respect to offerings of its
securities, all upon the terms and conditions set forth herein.
 
(b)           Underwriting.  If the registration statement under which the
Company gives notice under this Section 2.2 is for an underwritten offering, the
Company shall so advise Investors who hold, and the Holders of, Registrable
Securities.  In such event, the right of any such Investor and/or Holder to be
included in a registration pursuant to this Section 2.2 shall be conditioned
upon such Investor’s or Holder’s participation in such underwriting and the
inclusion of such Investor’s and/or Holder’s Registrable Securities in the
underwriting to the extent provided herein.  All Investors and/or Holders
proposing to distribute their Registrable Securities through such underwriting
shall enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by the Company.
 
Notwithstanding any other provision of this Agreement, if the underwriter
determines in good faith that marketing factors require a limitation of the
number of shares to be underwritten, the number of shares that may be included
in the underwriting shall be allocated first to the Company; second, to all
Investors and/or Holders who are entitled to participate and who have elected to
participate in the offering pursuant to the terms of this Agreement, on a pro
rata basis based upon the total number of shares held by each such participating
Investor or Holder that are subject to piggyback registration rights pursuant
hereto; and third, to any other stockholder of the Company on a pro rata basis.
 
If any Investor or Holder disapproves of the terms of any such underwriting,
such Investor or Holder may elect to withdraw therefrom by written notice to the
Company and the
 

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underwriter, delivered at least ten (10) calendar days prior to the effective
date of the registration statement.  Any Registrable Securities excluded or
withdrawn from such underwriting shall be excluded and withdrawn from the
registration.  For any Investor or Holder which is a partnership or corporation,
the partners, stockholders, subsidiaries, parents and affiliates of such
Investor or Holder, or the estates and family members of any such partners and
retired partners and any trusts for the benefit of any of the foregoing Persons
shall be deemed to be a single “Investor” or “Holder”, as the case may be, and
any pro rata reduction with respect to such “Investor” or “Holder” shall be
based upon the aggregate amount of shares carrying registration rights owned by
all entities and individuals included in such “Investor” or “Holder”, as defined
in this sentence.
 
(c)           Right to Terminate Registration.  The Company shall have the right
to terminate or withdraw any registration initiated by it under this Section 2.2
prior to the effectiveness of such registration whether or not any Investor
and/or Holder has elected to include securities in such registration.  The
Registration Expenses of such withdrawn registration shall be borne by the
Company in accordance with Section 2.4 hereof.
 
(d)           The Company shall not grant to any other Person the right to
request the Company (i) to register any shares of Common Stock in a piggyback
registration unless such rights are consistent with the provisions hereof, or
(ii) to register any securities of the Company (other than shares of Common
Stock) in a piggyback registration.
 
2.3           Form S-3 Registration.  Subject to the Lock-up Agreement, in case
the Company shall receive at any time from (1) the Institutional Investor, so
long as the Institutional Investor and its Affiliates hold at least 25% of the
Shares (determined on an as converted to Common Stock basis) held by the
Institutional Investor and its Affiliates as of the date hereof, or (2) in the
event the Institutional Investor and its Affiliates do not hold at least 25% of
the Shares (determined on an as converted to Common Stock basis) held by the
Institutional Investor and its Affiliates as of the date hereof, then the
Holders of at least 50% of the Registrable Securities then outstanding a written
request or requests that the Company effect a registration on Form S-3 (or any
successor to Form S-3) or any similar short-form registration statement and any
related qualification or compliance with respect to all or a part of the
Registrable Securities owned by the Institutional Investor or such Holder or
Holders, the Company will:
 
(a)           promptly give written notice of the proposed registration, and any
related qualification or compliance, to all other Holders of Registrable
Securities; and
 
(b)           as soon as practicable, file such registration statement and use
its commercially reasonable efforts to have such registration statement declared
effective and obtain all such qualifications and compliances as may be so
requested and as would permit or facilitate the sale and distribution of all or
such portion of the Institutional Investor’s or such Holder’s or Holders’
Registrable Securities as are specified in such request, together with all or
such portion of the Registrable Securities of any other Holder or Holders
joining in such request as are specified in a written request given within ten
(10) days after receipt of such written notice from the Company; provided,
however, that the Company shall not be obligated to effect any such
registration, qualification or compliance pursuant to this
Section 2.3:  (i) prior to the first anniversary date of the Closing Date (as
defined in the Stock Purchase Agreement); (ii) if
 

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Form S-3 is not available for such offering by the Institutional Investor or the
Holders; (iii) if the Institutional Investor and the Holders, together with the
holders of any other securities of the Company entitled to inclusion in such
registration, propose to sell Registrable Securities and such other securities
(if any) at an anticipated aggregate offering price to the public of less than
twenty-five million dollars ($25,000,000); or (iv) if the Company shall furnish
to the Institutional Investor and the Holders a certificate signed by the
Chairman of the Board of Directors of the Company stating that in the good faith
and reasonable judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its stockholders for such Form S-3
registration to be effected at such time (but excluding any detriment to the
Company solely as a result of its impact on the share price), in which event the
Company shall have the right to defer the filing of the Form S-3 registration
statement for a period of not more than ninety (90) days after receipt of the
request of the Institutional Investor or the Holder or Holders under this
Section 2.3; provided, that such right to delay a request shall be exercised by
the Company not more than twice in any twelve (12) month period; or (iv) after
the Company has effected four (4) registrations on Form S-3 pursuant to this
Section 2.3 and such registrations have been declared or ordered
effective.  Notwithstanding the foregoing, any expenses in connection with such
registration or attempted registration shall be Registration Expenses.
 
(c)           Subject to the foregoing, the Company shall file a Form S-3
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as reasonably practicable after receipt of
the request or requests of the Institutional Investor or such
Holders.  Registrations effected pursuant to this Section 2.3 shall not be
counted as a demand for registration or registrations effected pursuant to
Sections 2.1 or 2.2, respectively.
 
(d)           The Company shall not grant to any other Person the right to
request the Company to register any shares of Common Stock in an S-3
registration unless such rights are consistent with the provisions hereof,
except in the case of a Form S-3 registration statement filed to register any
shares of Common Stock issued in connection with any acquisition, merger or
similar transaction by the Company.
 
2.4           Expenses of Registration.  Except as specifically provided herein,
all Registration Expenses incurred in connection with any registration,
qualification or compliance hereunder shall be borne by the Company.  All
Selling Expenses incurred in connection with any registrations hereunder, shall
be borne by the holders of the securities so registered pro rata on the basis of
the number of shares so registered.  The Company shall not, however, be required
to pay for expenses of any registration proceeding begun pursuant to Section 2.1
or 2.3, the request of which has been subsequently withdrawn by the
Institutional Investor or the Initiating Holders or requesting Holder(s) unless
(a) the Company has requested the Institutional Investor or the Initiating
Holders or requesting Holder(s) to withdraw such request or the Company and the
Institutional Investor, Initiating Holders or requesting Holders(s) jointly
determine that such request should be withdrawn, (b) the withdrawal is based
upon material adverse information concerning the Company that the Company had
not publicly revealed at least forty-eight (48) hours prior to the request or
that the Company had not otherwise notified the Institutional Investor or the
Initiating Holders or requesting Holders of at the time of such request or
(c) the Institutional Investor or the Holders of a majority of Registrable
Securities, as the case may be, agree to forfeit their right to one requested
registration pursuant to Section 2.1 or Section 2.3, as applicable, in which
event such right shall be forfeited by all Holders.
 

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If the Institutional Investor and/or the Holders are required to pay the
Registration Expenses, such expenses shall be borne by the Institutional
Investor or the Holders of securities (including Registrable Securities)
requesting such registration in proportion to the number of shares for which
registration was requested.  If the Company is required to pay the Registration
Expenses of a withdrawn offering pursuant to clause (a) above, then the
Institutional Investor or the Holders, as the case may be, shall not forfeit
their rights pursuant to Section 2.1 or Section 2.3.
 
2.5           Obligations of the Company.  In the Mandatory Registration and
whenever required to effect the registration of any Registrable Securities, the
Company shall, as expeditiously as reasonably possible:
 
(a)           Subject to Section 2.1(b) in the case of the Mandatory
Registration, prepare and file with the SEC a registration statement, and all
amendments and supplements thereto and related prospectuses as may be necessary
to comply with applicable securities laws, with respect to such Registrable
Securities and use its best efforts to cause such registration statement to
become effective (provided that before filing a registration statement or
prospectus or any amendments or supplements thereto, the Company shall furnish
to the counsel selected by the Holders of a majority of the Registrable
Securities covered by such registration statement copies of all such documents
proposed to be filed, and the Company shall in good faith consider any comments
of such counsel).
 
(b)           Prepare and, within 60 days after the end of the period within
which requests for registration have been given to the Company, file with the
SEC a registration statement with respect to such Registrable Securities and use
all reasonable best efforts to cause such registration statement to become
effective (provided that, before filing a registration statement or prospectus
or any amendments or supplements thereto, the Company shall furnish to the
counsel selected by the holders of a majority of Registrable Securities covered
by such registration statement copies of all such documents proposed to be
filed, and the Company shall in good faith consider any comments of such
counsel), notify in writing each Holder of the effectiveness of each
registration statement filed hereunder, and, upon the request of the Holders of
a majority of the Registrable Securities registered thereunder, keep such
registration statement effective for up to one hundred and eighty (180) days or,
if earlier, until the Holder or Holders have completed the distribution related
thereto (or, in the case of a Shelf Registration, a period ending on such date
as is the earlier of (i) the date on which all Registrable Securities included
in the registration statement shall have been sold or shall have otherwise
ceased to be Registrable Securities and (ii) the date on which all remaining
Registrable Securities may be sold during any ninety (90) day period without any
restriction pursuant to Rule 144 under the Securities Act, other than
Rule 144(k), after taking into account any holders’ status as an affiliate of
the Company as determined by the counsel to the Company pursuant to a written
opinion letter addressed to the Company’s transfer agent to such effect).
 
(c)           Prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement for the period set forth in paragraph (a) above.
 

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(d)           Furnish to the Investors and Holders such number of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.
 
(e)           Use its commercially reasonable efforts to register and qualify
the securities covered by such registration statement under such other
securities or Blue Sky laws of such jurisdictions as shall be reasonably
requested by the Holders; provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do business or to
file a general consent to service of process in any such states or
jurisdictions.
 
(f)           In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter(s) of such offering.  Each Investor and/or
Holder participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
 
(g)           Notify each Investor who holds, and each Holder of, 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
happening of any event as a result of which the prospectus included in such
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing and, at the request of the holders of a majority of
the Registrable Securities covered by such registration statement, the Company
shall promptly prepare and furnish to each such seller a reasonable number of
copies of a supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus
shall not contain an untrue statement of a material fact or omit to state any
fact necessary to make the statements therein not misleading in light of the
circumstances under which they were made.
 
(h)           Use its commercially reasonable efforts to furnish, on the date
that such Registrable Securities are delivered to the underwriters for sale, if
such securities are being sold through underwriters, (i) an opinion, dated as of
such date, of the counsel representing the Company for the purposes of such
registration, in form and substance as is customarily given to underwriters in
an underwritten public offering, addressed to the underwriters, if any, and
(ii) a letter dated as of such date, from the independent registered public
accountants of the Company, in form and substance as is customarily given by
independent registered public accountants to underwriters in an underwritten
public offering addressed to the underwriters.
 
(i)           In the event of the issuance of any stop order suspending the
effectiveness of a registration statement, or any order suspending or preventing
the use of any related prospectus or suspending the qualification of any equity
securities included in such registration statement for sale in any jurisdiction,
the Company shall use its reasonable best efforts promptly to obtain the
withdrawal of such order.
 
2.6           Suspension of Sales.  Upon receipt of written notice from the
Company that a registration statement or prospectus contains an untrue statement
of a material fact or omits to state a material fact required to be stated
therein or necessary to make the statements therein not
 

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misleading (a “Misstatement”), each Investor who holds, and each Holder of,
Registrable Securities shall forthwith discontinue disposition of Registrable
Securities until such Investor and/or Holder has received copies of the
supplemented or amended prospectus that corrects such Misstatement, or until
such Investor and/or Holder is advised in writing by the Company that the use of
the prospectus may be resumed, and, if so directed by the Company, such Investor
and/or Holder shall deliver to the Company (at the Company’s expense) all
copies, other than permanent file copies then in such Investor’s or Holder’s
possession, of the prospectus covering such Registrable Securities current at
the time of receipt of such notice.  The total number of days that any such
suspension may be in effect in any 180 day period shall not exceed 45 days.
 
2.7           Termination of Registration Rights.  An Investor’s and a Holder’s
registration rights shall expire if all Registrable Securities held by such
Investor or Holder (and its Affiliates, partners, members and former members)
may be sold without any restriction under Rule 144 under the Securities Act,
other than Rule 144(k), during any ninety (90) day period after taking into
account any Holders’ status as an affiliate of the Company as determined by the
counsel to the Company pursuant to a written opinion letter addressed to the
Company’s transfer agent to such effect.
 
2.8           Delay of Registration; Furnishing Information.
 
(a)           No Investor or Holder shall have any right to obtain or seek an
injunction restraining or otherwise delaying any such registration as the result
of any controversy that might arise with respect to the interpretation or
implementation of this Section 2.
 
(b)           It shall be a condition precedent to the obligations of the
Company to take any action pursuant to Section 2.1, 2.2 or 2.3 that the selling
Investors and/or Holders shall furnish to the Company such information regarding
themselves, the Registrable Securities held by them and the intended method of
disposition of such securities as shall be required to effect the registration
of their Registrable Securities.
 
(c)           The Company shall have no obligation with respect to any
registration requested pursuant to Section 2.1 or Section 2.3 (except that any
expenses in connection with such registration or attempted registration shall be
Registration Expenses) if the number of shares or the anticipated aggregate
offering price of the Registrable Securities to be included in the registration
does not equal or exceed the number of shares or the anticipated aggregate
offering price required to originally trigger the Company’s obligation to
initiate such registration as specified in Section 2.1 or Section 2.3, whichever
is applicable.
 
2.9           Indemnification.  In the event any Registrable Securities are
included in a registration statement under this Section 2:
 
(a)           To the extent permitted by law, the Company will indemnify and
hold harmless each Investor, Holder, any underwriter (as defined in the
Securities Act) for such Investor or Holder and each person, if any, who
controls such Investor or Holder or underwriter within the meaning of the
Securities Act or the Exchange Act, against any losses, claims, damages, or
liabilities (joint or several) to which they may become subject under the
Securities Act, or the Exchange Act or other federal or state law, insofar as
such losses, claims, damages, or
 

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liabilities (or actions in respect thereof) arise out of or are based upon any
of the following statements, omissions or violations (collectively, a
“Violation”):  (i) any untrue statement or alleged untrue statement of a
material fact contained in such registration statement, including any
preliminary prospectus or final prospectus contained therein or any amendments
or supplements thereto, (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not misleading, or (iii) any violation or alleged violation by the
Company of the Securities Act, the Exchange Act, any state securities law or any
rule or regulation promulgated under the Securities Act, the Exchange Act or any
state securities law; and the Company will pay to each such Investor, Holder,
underwriter or controlling person, as accrued any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this Section 2.9(a) shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable in any such case
for any such loss, claim, damage, liability, or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration statement by any such Investor, Holder, underwriter or
controlling person.
 
(b)           To the extent permitted by law and provided that such Holder is
not entitled to indemnification pursuant to Section 2.9(a) above with respect to
such matter, each selling Investor or Holder (severally and not jointly) will
indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Company within the meaning of the Securities Act, any underwriter,
any other Investor or Holder selling securities in such registration statement
and any controlling person of any such underwriter or other Investor or Holder,
against any losses, claims, damages, or liabilities to which any of the
foregoing persons may become subject under the Securities Act, the Exchange Act
or other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or are based upon any
(i) untrue statement or alleged untrue statement of a material fact regarding
such Holder and provided in writing by such Holder which is contained in such
registration statement, including any preliminary prospectus or final prospectus
contained therein or any amendments or supplements thereto or (ii) the omission
or alleged omission to state therein a material fact required to be stated
therein, or necessary to make the statements therein not misleading, in each
case to the extent (and only to the extent) that such untrue statement or
alleged untrue statement or omission or alleged omission was made in such
registration statement, preliminary or final prospectus, amendment or supplement
thereto, in reliance upon and in conformity with written information furnished
by such Investor or Holder expressly for use in connection with such
registration statement; and each such Investor or Holder will pay, as accrued,
any legal or other expenses reasonably incurred by any Person intended to be
indemnified pursuant to this Section 2.9(b), in connection with investigating or
defending any such loss, claim, damage, liability, or action as a result of such
Holder’s untrue statement or omission; provided, however, that the indemnity
agreement contained in this Section 2.9(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Investor or Holder (which
consent shall not be unreasonably withheld); provided, that, (x) the
indemnification obligations in this Section 2.9(b) shall be individual and
ratable not joint and
 

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several for each Holder and (y) in no event shall the aggregate of all
indemnification payments by any Investor and/or Holder under this Section 2.9(b)
exceed the net proceeds from the offering received by such Investor and/or
Holder.
 
(c)           Promptly after receipt by an indemnified party under this
Section 2.9 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 2.9, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the reasonable fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by such
counsel in such proceeding.  The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
indemnified party under this Section 2.8, except to the extent such failure to
give notice has a material adverse effect on the ability of the indemnifying
party to defend such action.
 
(d)           If the indemnification provided for in this Section 2.9 is held by
a court of competent jurisdiction to be unavailable to an indemnified party with
respect to any loss, liability, claim, damage, or expense referred to therein,
then the indemnifying party, in lieu of indemnifying such indemnified party
hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage, or expense in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party on the one hand and of the indemnified party on the other in connection
with the statements or omissions that resulted in such loss, liability, claim,
damage, or expense as well as any other relevant equitable considerations.  The
relative fault of the indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the indemnifying party or by the indemnified
party and the parties’ relative intent, knowledge, access to information, and
opportunity to correct or prevent such statement or omission.  Notwithstanding
the foregoing, the amount any Investor or Holder will be obligated to contribute
pursuant to this Section 2.9(d) will be limited to an amount equal to the per
share public offering price (less any underwriting discount and commissions)
multiplied by the number of shares of Registrable Securities sold by such
Investor or Holder pursuant to the registration statement which gives rise to
such obligation to contribute (less the aggregate amount of any damages which
such Investor or Holder has otherwise been required to pay in respect of such
loss, liability, claim, damage, or expense or any substantially similar loss,
liability, claim, damage, or expense arising from the sale of such Registrable
Securities).  No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) will be entitled to contribution
hereunder from any person who was not guilty of such fraudulent
misrepresentation.
 

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(e)           Notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in the underwriting agreement
entered into in connection with the underwritten public offering are in conflict
with the foregoing provisions, the provisions in the underwriting agreement
shall control; provided that the indemnification provisions of the Holders in
any underwriting agreement may not conflict with the provisions of this
Section 2.9 without the consent of the Institutional Investor.
 
(f)           The obligations of the Company and Holders under this Section 2.9
shall survive the completion of any offering of Registrable Securities in a
registration statement under this Section 2, and otherwise.
 
2.10           Assignment of Registration Rights.  The rights to cause the
Company to register Registrable Securities pursuant to this Agreement may be
assigned by an Investor or Holder to a transferee or assignee of Registrable
Securities to which (a) there is transferred to such transferee no less than
twenty thousand (20,000) shares of Registrable Securities, appropriately
adjusted to reflect any stock splits, stock dividends, subdivisions, reverse
splits and similar events, (b) there is transferred to such transferee at least
ten percent (10%) of the shares of Registrable Securities held by the Investor
or Holder, (c) such transferee is an Affiliate, subsidiary or parent company,
family member or family trust for the benefit of a party hereto, or (d) such
transferee or transferees are partners of an Investor or Holder, who agree to
act through a single representative; provided, however, (i) the transferor shall
furnish to the Company written notice of the name and address of such transferee
or assignee and the securities with respect to which such registration rights
are being assigned and (ii) such transferee shall agree to be subject to all
restrictions set forth in this Agreement.
 
2.11           “Market Stand-Off’ Agreement; Agreement to Furnish
Information.  Each Investor and Holder hereby agrees that such Investor and/or
Holder shall not sell, transfer, make any short sale of, grant any option for
the purchase of, or enter into any hedging or similar transaction with the same
economic effect as a sale, any Common Stock (or other securities) of the Company
held by such Investor or Holder (other than those included in the registration)
for a period specified by the representative of the underwriters of Common Stock
(or other securities) of the Company not to exceed ten (10) days prior and
ninety (90) days following the effective date of a registration statement of the
Company filed under the Securities Act; provided that all executive officers and
directors of the Company enter into similar agreements and only if such Persons
remain subject thereto (and are not released from such agreement) for such 90
day period.  Each Investor and Holder agrees to execute and deliver such other
agreements as may be reasonably requested by the Company or the underwriter
which are consistent with the foregoing or which are necessary to give further
effect thereto.
 
In addition, if requested by the Company or the representative of the
underwriters of Common Stock (or other securities) of the Company, each Investor
and Holder shall provide, within ten (10) days of such request, such information
as may be required by the Company or such representative in connection with the
completion of any public offering of the Company’s securities pursuant to a
registration statement filed under the Securities Act.
 
The obligations described in this Section 2.11 shall not apply to a registration
relating solely to employee benefit plans on Form S-1 or Form S-8 or similar
forms that may be
 

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promulgated in the future, or a registration relating solely to a Commission
Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the
future.  The Company may impose stop-transfer instructions with respect to the
shares of Common Stock (or other securities) subject to the foregoing
restriction until the end of said 90 day period.  Each Investor and Holder
agrees that any transferee of any shares of Registrable Securities shall be
bound by this Section 2.11.
 
2.12           Rule 144 Reporting.  With a view to making available to the
Investors and Holders the benefits of certain rules and regulations of the SEC
which may permit the sale of the Registrable Securities to the public without
registration, the Company agrees to use its best efforts to:
 
(a)           make and keep public information available, as those terms are
understood and defined in SEC Rule 144 or any similar or analogous rule
promulgated under the Securities Act, at all times after the effective date of
this Agreement;
 
(b)           file with the SEC, in a timely manner, all reports and other
documents required of the Company under the Exchange Act; and
 
(c)           so long as an Investor or Holder owns any Registrable Securities,
furnish to such Investor or Holder forthwith upon request: a written statement
by the Company as to its compliance with the reporting requirements of Rule 144
under the Securities Act, and of the Exchange Act; a copy of the most recent
annual or quarterly report of the Company; and such other reports and documents
as an Investor or  Holder may reasonably request in availing itself of any rule
or regulation of the SEC allowing it to sell any such securities without
registration.
 
SECTION 3          PREEMPTIVE RIGHTS OF INSTITUTIONAL INVESTOR
 
3.1           Sale of New Stock.  Until the date on which the Institutional
Investor and its Affiliates collectively own less than five percent (5.0%) of
the outstanding Common Stock of the Company (assuming conversion of the Series A
Stock), if the Company at any time or from time to time makes a Qualified Equity
Offering, the Institutional Investor and its Affiliates shall be afforded the
opportunity to acquire from the Company for the same price and on the same terms
as such securities are proposed to be offered to others, in the aggregate up to
the amount of New Stock required to enable it to maintain its Institutional
Investor Percentage Interest.
 
3.2           Notice.
 
(a)           In the event the Company intends to make a Qualified Equity
Offering that is an underwritten public offering or a private offering made to
Qualified Institutional Buyers for resale pursuant to Rule 144A under the
Securities Act, no later than five (5) business days after the initial filing of
a registration statement with the SEC with respect to such underwritten public
offering or the commencement of marketing with respect to such Rule 144A
offering, it shall give Institutional Investor written notice of its intention
(including, in the case of a registered public offering and to the extent
possible, a copy of the prospectus included in the registration statement filed
in respect of such offering) describing, to the extent then known, the
anticipated amount of securities, range of prices, timing and other material
terms of such offering.  Institutional Investor shall have ten (10) calendar
days from the date of receipt of any such notice
 

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to notify the Company in writing that it and/or its Affiliates intend to
exercise such preemptive purchase rights and as to the amount of New Stock
Institutional Investor and its Affiliates desire to purchase, up to the maximum
amount calculated pursuant to Section 3.1 (including any over-allotment options
if applicable) (the “Designated Stock”).  Such notice shall constitute a
non-binding indication of interest of Institutional Investor and its Affiliates
to purchase the Designated Stock so specified at the range of prices and other
terms set forth in the Company’s notice to it.  The failure to respond during
such ten (10) calendar day period shall constitute a waiver of preemptive rights
in respect of such offering.
 
(b)           If the Company proposes to make a Qualified Equity Offering that
is not an underwritten public offering or Rule 144A offering (a “Private
Placement”), the Company shall give Institutional Investor written notice of its
intention, describing, to the extent then known, the anticipated amount of
securities, price and other material terms upon which the Company proposes to
offer the same.  Institutional Investor shall have ten (10) calendar days from
the date of receipt of the notice required by the immediately preceding sentence
to notify the Company in writing that it and/or its Affiliates intend to
exercise such preemptive purchase rights and as to the amount of Designated
Stock Institutional Investor and its Affiliates desire to purchase, up to the
maximum amount calculated pursuant to Section 3.1.  Such notice shall constitute
the binding agreement of Institutional Investor and/or its Affiliates to
purchase the amount of Designated Stock so specified (or a proportionately
lesser amount if the amount of New Stock to be offered in such Private Placement
is subsequently reduced) upon the price and other terms set forth in the
Company’s notice to it.  The failure of Institutional Investor to respond during
the ten (10) calendar day period referred to in the second preceding sentence
shall constitute a waiver of the preemptive rights in respect of such offering.
 
3.3           Purchase Mechanism.
 
(a)           If Institutional Investor exercises its preemptive rights provided
in Section 3.2(b), the closing of the purchase of the New Stock with respect to
which such right has been exercised shall be conditioned on the consummation of
the Private Placement giving rise to such preemptive purchase rights and shall
take place simultaneously with the closing of the Private Placement or on such
other date as the Company and the Institutional Investor shall agree in writing;
provided, that the actual amount of Designated Stock to be sold to the
Institutional Investor and its Affiliates pursuant to its exercise of preemptive
rights hereunder shall be reduced proportionately if the aggregate amount of New
Stock sold in the Private Placement is reduced and, at the option of the
Institutional Investor (to be exercised by delivery of written notice to the
Company within five (5) business days of receipt of notice of such increase),
shall be increased proportionately if such aggregate amount of New Stock sold in
the Private Placement is increased.  In connection with its purchase of
Designated Stock, Institutional Investor shall execute an instrument in form and
substance reasonably satisfactory to the Company containing representations,
warranties and agreements of Institutional Investor that are customary for
private placement transactions.
 
(b)           If the Institutional Investor exercises its preemptive purchase
rights provided in Section 3.2(a), the Company shall offer the Institutional
Investor and its Affiliates, if such underwritten public offering or Rule 144A
offering is consummated, the Designated Stock (as adjusted to reflect the actual
size of such offering when priced) at the same price as the New
 

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Stock is offered to the underwriters or initial purchasers and shall provide
written notice of such price to Institutional Investor as soon as practicable
prior to such consummation.  Contemporaneously with the execution of any
underwriting agreement or purchase agreement entered into between the Company
and the underwriters or initial purchasers of such underwritten public offering
or Rule 144A offering, Institutional Investor shall enter into an instrument in
form and substance reasonably satisfactory to the Company acknowledging
Institutional Investor’s and/or its Affiliate’s binding obligations to purchase
the Designated Stock to be acquired by it and/or its Affiliates and containing
representations, warranties and agreements of Institutional Investor that are
customary in private placement transactions, and the failure to enter into such
an instrument at or prior to such time shall constitute a waiver of preemptive
rights in respect of such offering.  Any offers and sales pursuant to this
Section 3 in the context of a registered public offering shall be also
conditioned on reasonably acceptable representations and warranties of the
Institutional Investor regarding its status as the type of offeree to whom a
private sale can be made concurrently with a registered offering in compliance
with applicable securities laws.
 
(c)           Upon the expiration of the offering periods described in
Section 3.2 above, the Company shall be entitled to sell such stock or
securities which the Institutional Investor and its Affiliates have not elected
to purchase during the 90 days following such expiration at a price not less and
on other terms and conditions not more favorable to the purchasers thereof than
that offered to the Institutional Investor and its Affiliates.  Any stock or
securities offered or sold by the Company after such 90-day period must be
reoffered to the Institutional Investor and its Affiliates pursuant to the terms
of this Section 3.2.
 
(d)           Notwithstanding any provision in this Agreement to the contrary,
in the event that the Institutional Purchaser and its Affiliates are entitled to
acquire Common Stock pursuant to this Section 3, then the Institutional
Purchaser and its Affiliates may at their option acquire securities in the form
of Series A Stock or another series of preferred stock of the Corporation with
terms, conditions and provisions that shall be established upon the issuance of
such preferred stock that are similar to and consistent with the terms,
conditions and provisions upon which the Series A Stock was established.
 
3.4           No Negotiation Right.  The Institutional Investor shall not have
any rights to participate in the negotiation of the proposed terms of any
Private Placement, underwritten public offering or Rule 144A offering.
 
3.5           Cooperation.  The Company and the Institutional Investor shall
cooperate in good faith to facilitate the exercise of the Institutional
Investor’s preemptive rights hereunder, including securing any required
approvals or consents, in a manner that does not jeopardize the timing,
marketing, pricing or execution of any offering of the Company’s securities.
 
3.6           Limitation of Rights.  Notwithstanding the above, nothing set
forth in this Section 3 shall confer upon the Institutional Investor the right
to purchase any shares of any equity securities of the Company other than Common
Stock, Series A Stock, preferred stock or other securities convertible into or
exchangeable for shares of Common Stock or which have voting rights or
participation features with Common Stock of the Company, and in no event shall
the issuance of shares of Common Stock by the Company as consideration pursuant
to any
 

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acquisition (whether structured as a merger or otherwise) (but not an offering
to raise capital to fund an acquisition) or pursuant to the terms and provisions
of any current or future equity compensation or employee benefit plan of the
Company or otherwise approved by the Board other than through a Qualified Equity
Offering be deemed included in any right granted to Institutional Investor under
this Section 3.
 
SECTION 4          MISCELLANEOUS
 
4.1           Successors and Assigns.  Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties (including
transferees of any shares of Registrable Securities).  Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
 
4.2           Governing Law.  This Agreement shall be governed by and construed
under the laws of the State of Illinois as applied to agreements among Illinois
residents entered into and to be performed entirely within the State of
Illinois.
 
4.3           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.
 
4.4           Titles and Subtitles.  The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
 
4.5           Notices.  Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified or upon
deposit with the United States Post Office, by registered or certified mail,
postage prepaid and addressed to the party to be notified at the address
indicated for such party on the signature page hereof, or at such other address
as such party may designate by ten (10) days’ advance written notice to the
other parties.
 
4.6           Expenses.  If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys’ fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
 
4.7           Amendments and Waivers.  Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively), only
with the written consent of the Company, the Institutional Investor so long as
the Institutional Investor holds Registrable Securities, and the holders of a
majority of the Registrable Securities then outstanding.  Any amendment or
waiver effected in accordance with this paragraph shall be binding upon each
Holder of any Registrable Securities then outstanding, each future Holder of all
such Registrable Securities, and the Company.
 

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4.8           Severability.  If one or more provisions of this Agreement are
held to be unenforceable under applicable law, such provision shall be excluded
from this Agreement and the balance of the Agreement shall be interpreted as if
such provision were so excluded and shall be enforceable in accordance with its
terms.
 
4.9           Aggregation of Stock.  All shares of Registrable Securities held
or acquired by any Investors which are Affiliates shall be aggregated together
for the purpose of determining the availability of any rights under this
Agreement.
 
4.10           Entire Agreement.  This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subject
matter hereof.
 

 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date set forth in the first paragraph hereof.
 
 

 
  PRIVATEBANCORP, INC.
 
 

   By:  

Name:  Larry D. Richman   Title:
 President and Chief Executive Officer
 
   Address: 
 70 West Madison Street
 Suite 900
 Chicago, Illinois  60602
 Attention:  General Counsel

 

 
  [Individually List each Investor]
 
 

   By:  

Name:     Title:
 
 
   Address: 
 

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