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                                                                   Exhibit 10.5

                         FORM OF PIPER JAFFRAY COMPANIES
                          2003 LONG-TERM INCENTIVE PLAN

SECTION 1. PURPOSE

         The purpose of the Plan is to promote the interests of the Company and
its stockholders by giving the Company a competitive advantage in attracting,
retaining and motivating employees, officers, consultants and Directors capable
of assuring the future success of the Company, to offer such persons incentives
that are directly linked to the profitability of the Company's businesses and
increases in stockholder value, and to afford such persons an opportunity to
acquire a proprietary interest in the Company.

SECTION 2. DEFINITIONS

         As used in the Plan, the following terms shall have the meanings set
forth below.

         (a) "AFFILIATE" means any entity that, directly or indirectly through
one or more intermediaries, is controlled by, controlling or under common
control with the Company.

         (b) "AWARD" means any Stock Option, Stock Appreciation Right,
Restricted Stock, Restricted Stock Unit, Performance Award, Dividend Equivalent,
Other Stock Grant, Other Stock-Based Award or Tax Offset Bonus granted under the
Plan.

         (c) "AWARD AGREEMENT" means any written agreement, contract or other
instrument or document evidencing any Award granted under the Plan. Each Award
Agreement shall be subject to the applicable terms and conditions of the Plan
and any other terms and conditions (not inconsistent with the Plan) determined
by the Committee.

         (d) "BOARD" means the Board of Directors of the Company.

         (e) "CODE" means the Internal Revenue Code of 1986, as amended from
time to time, and any regulations promulgated thereunder.

         (f) "CHANGE IN CONTROL" has the meaning set forth in Section 7.

         (g) "COMMITTEE" means a committee of Directors designated by the Board
to administer the Plan, which initially shall be the Compensation Committee of
the Board. The Committee shall be comprised of not less than such number of
Directors as shall be required to permit Awards granted under the Plan to
qualify under Rule 16b-3 and Section 162(m) of the Code, and each member of the
Committee shall be an Outside Director.

         (h) "COMPANY" means Piper Jaffray Companies, a Delaware corporation.

         (i) "COVERED EMPLOYEE" means a Participant designated prior to the
grant of Restricted Stock, Restricted Stock Units or Performance Awards by the
Committee who is or

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may be a "covered employee" within the meaning of Section 162(m)(3) of the Code
in the year in which any such Award is expected to be taxable to such
Participant.

         (j) "DIRECTOR" means a member of the Board, including any Outside
Director.

         (k) "DIVIDEND EQUIVALENT" means any right granted under Section 6(e) of
the Plan.

         (l) "EFFECTIVE DATE" has the meaning set forth in Section 11 of the
Plan.

         (m) "ELIGIBLE INDIVIDUAL" means any employee, officer, Director or
consultant providing services to the Company or any Affiliate, and prospective
employees and consultants who have accepted offers of employment or consultancy
from the Company or any Affiliate, whom the Committee determines to be an
Eligible Individual.

         (n) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended from time to time.

         (o) "EXERCISE PRICE" has the meaning set forth in Section 6(a) of the
Plan.

         (p) "FAIR MARKET VALUE" means, with respect to any property (including,
without limitation, any Shares or other securities), the fair market value of
such property determined by such methods or procedures as shall be established
from time to time by the Committee. Notwithstanding the foregoing and except as
otherwise provided by the Committee, the Fair Market Value of a Share as of a
given date shall be the closing sales price for one Share on the New York Stock
Exchange or such other national securities market or exchange as may at the time
be the principal market for the Shares, or if the Shares were not traded on such
national securities market or exchange on such date, then on the next preceding
date on which the Shares are traded, all as reported by such source as the
Committee may select.

         (q) "INCENTIVE STOCK OPTION" means any Stock Option granted under
Section 6(a) of the Plan that is designated as, and intended to qualify as, an
"incentive stock option" within the meaning of Section 422 of the Code.

         (r) "NON-QUALIFIED STOCK OPTION" means any Stock Option granted under
Section 6(a) of the Plan that is not an Incentive Stock Option.

         (s) "OUTSIDE DIRECTOR" means any Director who qualifies as an "outside
director" within the meaning of Section 162(m) of the Code and as a
"non-employee director" within the meaning of Rule 16b-3.

         (t) "PARTICIPANT" means an Eligible Individual designated to be granted
an Award under the Plan.

         (u) "PERFORMANCE AWARD" means any right granted under Section 6(d) of
the Plan.

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         (v) "PERFORMANCE GOALS" means the performance goals established by the
Committee in connection with the grant of an Award. In the case of Qualified
Performance-Based Awards, (i) such goals shall be based on the attainment of
specified levels of one or more of the following measures with respect to the
Company or such subsidiary, division or department of the Company for or within
which the Participant performances services: revenue growth; earnings before
interest, taxes, depreciation, and amortization; earnings before interest and
taxes; operating income; pre- or after- tax income; earnings per share; cash
flow; cash flow per share; return on equity; return on invested capital; return
on assets; economic value added (or an equivalent metric); share price
performance; total shareholder return; improvement in or attainment of expense
levels; improvement in or attainment of working capital levels and (ii) such
Performance Goals shall be set by the Committee within the time period
prescribed by Section 162(m) of the Code and related regulations. Such
Performance Goals also may be based upon the attaining of specified levels of
Company performance under one or more of the measures described above relative
to the performance of other companies.

         (w) "PLAN" means this Piper Jaffray Companies 2003 Long-Term Incentive
Plan, as set forth herein and as hereinafter amended from time to time.

         (x) "QUALIFIED PERFORMANCE-BASED AWARD" means an Award of Restricted
Stock, Restricted Stock Units or Performance Awards designated as such by the
Committee at the time of grant, based upon a determination that (i) the
recipient is or may be a Covered Employee in the year in which the Company would
expect to be able to claim a tax deduction with respect to such Restricted Stock
or Performance Awards and (ii) the Committee wishes such Award to qualify for
the Section 162(m) Exemption.

         (y) "RESTRICTED STOCK" means any Share granted under Section 6(c) of
the Plan.

         (z) "RESTRICTED STOCK UNIT" means any unit granted under Section 6(c)
of the Plan evidencing the right to receive a Share (or a cash payment equal to
the Fair Market Value of a Share) at some future date.

         (aa) "RULE 16b-3" means Rule 16b-3, as promulgated by the Securities
and Exchange Commission under Section 16(b) of the Exchange Act, as amended from
time to time.

         (bb) "SECTION 162(m) EXEMPTION" means the exemption from the limitation
on deductibility imposed by Section 162(m) of the Code that is set forth in
Section 162(m)(4)(C) of the Code.

         (cc) "SHARE" or "SHARES" means a share or shares of common stock, par
value $.01 per share, of the Company.

         (dd) "STOCK APPRECIATION RIGHT" means any right granted under Section
6(b) of the Plan.

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         (ee) "STOCK OPTION" means an Incentive Stock Option or a Non-Qualified
Stock Option.

SECTION 3. ADMINISTRATION

         (a) POWER AND AUTHORITY OF THE COMMITTEE. The Plan shall be
administered by the Committee, except with respect to Awards to non-employee
Directors, which shall be administered by the Nominating and Governance
Committee. All references to the "Committee" with respect to grants to
non-employee Directors shall refer to the Nominating and Governance Committee.
Subject to the terms of the Plan and to applicable law, the Committee shall have
full power and authority to:

                  (i) designate Participants;

                  (ii) determine whether and to what extent any type (or types)
         of Award is to be granted hereunder;

                  (iii) determine the number of Shares to be covered by (or the
         method by which payments or other rights are to be determined in
         connection with) each Award;

                  (iv) determine the terms and conditions of any Award or Award
         Agreement;

                  (v) subject to Section 9 hereof, amend the terms and
         conditions of any Award or Award Agreement and accelerate the vesting
         and/or exercisability of any Stock Option or waive any restrictions
         relating to any Award; PROVIDED, HOWEVER, that (A) except for
         adjustments pursuant to Section 4(c) of the Plan, in no event may any
         Stock Option granted under this Plan be (x) amended to decrease the
         Exercise Price thereof, (y) cancelled in conjunction with the
         grant of any new Stock Option with a lower Exercise Price, or (z)
         otherwise subject to any action that would be treated, for accounting
         purposes, as a "repricing" of such Stock Option, unless such amendment,
         cancellation, or action is approved by the stockholders of the Company
         to the extent required by applicable law and stock exchange rules and
         (B) the Committee may not adjust upwards the amount payable to a
         Covered Employee with respect to a Qualified Performance-Based Award or
         waive or alter the Performance Goals associated therewith in a manner
         that would violate Section 162(m) of the Code.

                  (vi) determine whether, to what extent and under what
         circumstances the exercise price of Awards may be paid in cash, Shares,
         other securities, other Awards or other property, or canceled,
         forfeited or suspended;

                  (vii) determine whether, to what extent and under what
         circumstances cash, Shares, other securities, other Awards, other
         property and other amounts payable with respect to an Award under the
         Plan shall be deferred either automatically or at the election of the
         holder thereof or the Committee;

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                  (viii) interpret and administer the Plan and any instrument or
         agreement, including an Award Agreement, relating to the Plan;

                  (ix) adopt, alter, suspend, waive or repeal such rules,
         guidelines and practices and appoint such agents as it shall deem
         advisable or appropriate for the proper administration of the Plan; and

                  (x) make any other determination and take any other action
         that the Committee deems necessary or desirable for the administration
         of the Plan.

Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations and other decisions under or with respect to the
Plan or any Award or Award Agreement shall be within the sole discretion of the
Committee, may be made at any time and shall be final, conclusive and binding
upon all persons, including without limitation, the Company, its Affiliates,
subsidiaries, shareholders, Eligible Individuals and any holder or beneficiary
of any Award.

         (b) ACTION BY THE COMMITTEE; DELEGATION. Except to the extent
prohibited by applicable law or the applicable rules of a stock exchange, the
Committee may delegate all or any part of its duties and powers under the Plan
to one or more persons, including Directors or a committee of Directors, subject
to such terms, conditions and limitations as the Committee may establish in its
sole discretion; PROVIDED, HOWEVER, that the Committee shall not delegate its
powers and duties under the Plan (i) with regard to officers or directors of the
Company or any Affiliate who are subject to Section 16 of the Exchange Act or
(ii) in a manner that would cause an Award designated as a Qualified
Performance-Based Award not to qualify for, or to cease to qualify for, the
Section 162(m) Exemption; and PROVIDED, FURTHER, that any such delegation may be
revoked by the Committee at any time.

         (c) POWER AND AUTHORITY OF THE BOARD. Notwithstanding anything to the
contrary contained herein, except to the extent that the grant or exercise of
such authority would cause any Award or transaction to become subject to (or
lose an exemption under) the short-swing profit recovery provisions of Section
16 of the Exchange Act or cause an Award designated as a Qualified
Performance-Based Award not to qualify for, or to cease to qualify for, the
Section 162(m) Exemption, the Board may, at any time and from time to time,
without any further action of the Committee, exercise the powers and duties of
the Committee under the Plan. To the extent that any permitted action taken by
the Board conflicts with action taken by the Committee, the Board action shall
control.

SECTION 4. SHARES AVAILABLE FOR AWARDS

         (a) SHARES AVAILABLE. Subject to adjustment as provided in Section 4(c)
of the Plan, the aggregate number of Shares that may be issued under the Plan
shall be [ ]. Shares that may be issued under the Plan may be authorized but
unissued Shares or Shares re-acquired and held in treasury. Notwithstanding the
foregoing, (i) the number of Shares available for granting

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Incentive Stock Options under the Plan shall not exceed [ ], subject to
adjustment as provided in Section 4(c) of the Plan and subject to the provisions
of Section 422 or 424 of the Code or any successor provision, and (ii) the
number of Shares available for granting Restricted Stock and Restricted Stock
Units shall not exceed [ ], subject to adjustment as provided in Section 4(c) of
the Plan.

         (b) ACCOUNTING FOR AWARDS. For purposes of this Section 4, if an Award
entitles the holder thereof to receive or purchase Shares, the number of Shares
covered by such Award or to which such Award relates shall be counted on the
date of grant of such Award against the aggregate number of Shares available for
granting Awards under the Plan. Any Shares that are used by a Participant as
full or partial payment to the Company of the purchase price relating to an
Award, including in connection with the satisfaction of tax obligations relating
to an Award, shall again be available for granting Awards (other than Incentive
Stock Options) under the Plan. In addition, if any Shares covered by an Award or
to which an Award relates are not purchased or are forfeited, or if an Award
otherwise terminates without delivery of any Shares, then the number of Shares
counted against the aggregate number of Shares available under the Plan with
respect to such Award, to the extent of any such forfeiture or termination,
shall again be available for granting Awards under the Plan.

         (c) ADJUSTMENTS. In the event of any change in corporate capitalization
(including, but not limited to, a change in the number of Shares outstanding),
such as a stock split or a corporate transaction, such as any merger,
consolidation, separation, including a spin-off, or other distribution of stock
or property of the Company (including any extraordinary cash or stock dividend),
any reorganization (whether or not such reorganization comes within the
definition of such term in Section 368 of the Code) or any partial or complete
liquidation of the Company, the Committee or Board may make such substitution or
adjustments in the aggregate number and kind of shares reserved for issuance
under the Plan, and the maximum limitation upon Stock Options and Stock
Appreciation Rights and other Awards to be granted to any Participant, in the
number, kind and Exercise Price of shares subject to outstanding Stock Options
and Stock Appreciation Rights, in the number and kind of shares subject to other
outstanding Awards granted under the Plan and/or such other equitable
substitution or adjustments as it may determine to be appropriate in its sole
discretion (including, without limitation, the provision of an amount in cash in
consideration for any such Awards); PROVIDED, HOWEVER, that the number of shares
subject to any Award shall always be a whole number.

         (d) AWARD LIMITATIONS. No more than __ shares of Common Stock may be
subject to Qualified Performance-Based Awards granted to any Eligible Individual
in any fiscal year of the Company.

SECTION 5. ELIGIBILITY

         Any Eligible Individual shall be eligible to be designated a
Participant. In determining which Eligible Individuals shall receive an Award
and the terms of any Award, the Committee may take into account the nature of
the services rendered by the respective Eligible Individuals,

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their present and potential contributions to the success of the Company or such
other factors as the Committee, in its discretion, shall deem relevant.
Notwithstanding the foregoing, Incentive Stock Options may be granted only to
full-time or part-time employees (which term as used herein includes, without
limitation, officers and Directors who also are employees), and an Incentive
Stock Option shall not be granted to an employee of an Affiliate unless such
Affiliate also is a "subsidiary corporation" of the Company within the meaning
of Section 424(f) of the Code or any successor provision.

SECTION 6. AWARDS

         (a) STOCK OPTIONS. The Committee is hereby authorized to grant Stock
Options (which may be Non-Qualified Stock Options or Incentive Stock Options) to
Eligible Individuals with the following terms and conditions and with such
additional terms and conditions not inconsistent with the provisions of the Plan
as the Committee shall determine:

                  (i) EXERCISE PRICE. The purchase price per Share purchasable
         under a Stock Option (the "EXERCISE PRICE") shall be determined by the
         Committee; PROVIDED, HOWEVER, that, unless otherwise determined by the
         Committee, such Exercise Price shall not be less than 100% of the Fair
         Market Value of a Share on the date of grant of such Stock Option.

                  (ii) OPTION TERM. The term of each Stock Option shall be fixed
         by the Committee at the time of grant, but in no event shall be more
         than 10 years from the date of grant.

                  (iii) TIME AND METHOD OF EXERCISE. The Committee shall
         determine the time or times at which a Stock Option may be exercised in
         whole or in part and the method or methods by which, and the form or
         forms (including, without limitation, cash Shares, other securities,
         other Awards or other property, or any combination thereof, having a
         Fair Market Value on the exercise date equal to the applicable Exercise
         Price) in which, payment of the Exercise Price with respect thereto may
         be made or deemed to have been made.

                  (iv) INCENTIVE STOCK OPTIONS. The Committee may designate
         Stock Options as Non-Qualified Stock Options or as Incentive Stock
         Options. Any Incentive Stock Option authorized under the Plan shall
         contain such provisions as the Committee shall deem advisable, but
         shall in all events be consistent with and contain all provisions
         required in order to qualify the Stock Option as an Incentive Stock
         Option. To the extent that any Stock Option is not designated as an
         Incentive Stock Option or even if so designated does not qualify as an
         Incentive Stock Option on or subsequent to its grant date, it shall
         constitute a Non-Qualified Stock Option.

         (b) STOCK APPRECIATION RIGHTS. The Committee is hereby authorized to
grant Stock Appreciation Rights to Eligible Individuals subject to the terms of
the Plan. Each Stock Appreciation Right granted under the Plan shall confer on
the holder upon exercise the right to

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receive, as determined by the Committee, cash or a number of Shares equal to the
excess of (A) the Fair Market Value of one Share on the date of exercise (or, if
the Committee shall so determine, at any time during a specified period before
or after the date of exercise) over (B) the grant price of the Stock
Appreciation Right as determined by the Committee, which grant price shall not
be less than 100% of the Fair Market Value of one Share on the date of grant of
the Stock Appreciation Right, unless otherwise determined by the Committee.
Subject to the terms of the Plan, the grant price, term, methods of exercise,
dates of exercise, methods of settlement and any other terms and conditions
(including conditions or restrictions on the exercise thereof) of any Stock
Appreciation Right shall be as determined by the Committee, PROVIDED, that in no
event shall the term of a Stock Appreciation Right be longer than ten years.

         (c) RESTRICTED STOCK AND RESTRICTED STOCK UNITS. The Committee is
hereby authorized to grant Restricted Stock and Restricted Stock Units to
Eligible Individuals with the following terms and conditions and with such
additional terms and conditions not inconsistent with the provisions of the Plan
as the Committee shall determine:

                  (i) RESTRICTIONS. Shares of Restricted Stock and Restricted
         Stock Units shall be subject to such restrictions as the Committee may
         impose (including, without limitation, limitation on transfer,
         forfeiture conditions, limitation on the right to vote a Share of
         Restricted Stock or the right to receive any dividend or other right or
         property with respect thereto), which restrictions may lapse separately
         or in combination at such time or times, in such installments or
         otherwise as the Committee may deem appropriate. The grant or vesting
         of Restricted Stock and Restricted Stock Units may be performance-based
         or time-based or both. Restricted Stock and Restricted Stock Units may
         be Qualified Performance-Based Awards, in which event the grant or
         vesting, as applicable, of such Restricted Stock or Restricted Stock
         Units shall be conditioned upon the attainment of Performance Goals.

                  (ii) STOCK CERTIFICATES; DELIVERY OF SHARES.

                           (A) Any Restricted Stock granted under the Plan shall
                  be evidenced in such manner as the Committee may deem
                  appropriate, including book-entry registration or issuance of
                  one or more stock certificates. Any certificate issued in
                  respect of shares of Restricted Stock shall be registered in
                  the name of such Participant and shall bear an appropriate
                  legend referring to the applicable Award Agreement and
                  possible forfeiture of such shares of Restricted Stock. The
                  Committee may require that the certificates evidencing such
                  shares be held in custody by the Company until the
                  restrictions thereon shall have lapsed and that, as a
                  condition of any Award of Restricted Stock, the Participant
                  shall have delivered a stock power, endorsed in blank,
                  relating to the Shares covered by such Award.

                           (B) In the case of Restricted Stock Units, no Shares
                  or other property shall be issued at the time such Awards are
                  granted. Upon the lapse or waiver of restrictions and the
                  restricted period relating to Restricted Stock Units (or at
                  such

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                  later time as may be determined by the Committee), Shares or
                  other cash or property shall be issued to the holder of the
                  Restricted Stock Units and evidenced in such manner as the
                  Committee may deem appropriate, including book-entry
                  registration or issuance of one or more stock certificates.

                  (iii) FORFEITURE. Except as otherwise determined by the
         Committee, upon a Participant's termination of employment (as
         determined under criteria established by the Committee) during the
         applicable restriction period, all applicable Shares of Restricted
         Stock and Restricted Stock Units at such time subject to restriction
         shall be forfeited and reacquired by the Company; PROVIDED, HOWEVER,
         that the Committee may, when it finds that a waiver would be in the
         best interest of the Company, waive in whole or in part any or all
         remaining restrictions with respect to Shares of Restricted Stock or
         Restricted Stock Units.

         (d) PERFORMANCE AWARDS. The Committee is hereby authorized to grant
Performance Awards to Eligible Individuals subject to the terms of the Plan. A
Performance Award granted under the Plan (i) may be denominated or payable in
cash, Shares (including, without limitation, Restricted Stock and Restricted
Stock Units), other securities, other Awards or other property and (ii) shall
confer on the holder thereof the right to receive payments, in whole or in part,
upon the achievement of such performance goals during such performance periods
as the Committee shall establish. Subject to the terms of the Plan, the
performance goals to be achieved during any performance period, the length of
any performance period, the amount of any Performance Award granted, the amount
of any payment or transfer to be made pursuant to any Performance Award and any
other terms and conditions of any Performance Award shall be determined by the
Committee. The Committee may, prior to or at the time of the grant, designate
Performance Awards as Qualified Performance-Based Awards, in which event it
shall condition the settlement thereof upon the attainment of Performance Goals.

         (e) DIVIDEND EQUIVALENTS. The Committee is hereby authorized to grant
Dividend Equivalents to Eligible Individuals under which the Participant shall
be entitled to receive payments (in cash, Shares, other securities, other Awards
or other property as determined in the discretion of the Committee) equivalent
to the amount of cash dividends paid by the Company to holders of Shares with
respect to a number of Shares determined by the Committee. Subject to the terms
of the Plan, such Dividend Equivalents may have such terms and conditions as the
Committee shall determine.

         (f) OTHER STOCK GRANTS. The Committee is hereby authorized, subject to
the terms of the Plan, to grant to Eligible Individuals Shares without
restrictions thereon as are deemed by the Committee to be consistent with the
purpose of the Plan.

         (g) OTHER STOCK-BASED AWARDS. The Committee is hereby authorized to
grant to Eligible Individuals, subject to the terms of the Plan, such other
Awards that are denominated or payable in, valued in whole or in part by
reference to, or otherwise based on or related to, Shares (including, without
limitation, securities convertible into Shares), as are deemed by the Committee
to be consistent with the purpose of the Plan. Shares or other securities
delivered

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pursuant to a purchase right granted under this Section 6(g) shall be purchased
for such consideration, which may be paid by such method or methods and in such
form or forms (including, without limitation, cash, Shares, other securities,
other Awards or other property or any combination thereof), as the Committee
shall determine, the value of which consideration, as established by the
Committee, shall not be less than 100% of the Fair Market Value of such Shares
or other securities as of the date such purchase right is granted, unless
otherwise determined by the Committee.

         (h) TAX OFFSET BONUS. The Committee may grant to a Participant, at the
time of granting an Award or at any time thereafter, the right to receive a cash
payment in an amount specified by the Committee, to be paid at such time or
times (if ever) as the Award results in compensation income to the Participant,
for the purpose of assisting the Participant to pay the resulting taxes, all as
determined by the Committee and on such other terms and conditions as the
Committee shall determine (a "TAX OFFSET BONUS").

         (i) GENERAL.

                  (i) CONSIDERATION FOR AWARDS. Awards may be granted for no
         cash consideration or for any cash or other consideration as determined
         by the Committee and required by applicable law.

                  (ii) AWARDS MAY BE GRANTED SEPARATELY OR TOGETHER. Awards may,
         in the discretion of the Committee, be granted either alone or in
         addition to, in tandem with or in substitution for any other Award or
         any award granted under any plan of the Company or any Affiliate.
         Awards granted in addition to or in tandem with other Awards or in
         addition to or in tandem with awards granted under any such other plan
         of the Company or any Affiliate may be granted either at the same time
         as or at a different time from the grant of such other Awards or
         awards.

                  (iii) FORMS OF PAYMENT UNDER AWARDS. Subject to the terms of
         the Plan, payments or transfers to be made by the Company or an
         Affiliate upon the grant, exercise or settlement of an Award may be
         made in such form or forms as the Committee shall determine (including,
         without limitation, cash, Shares, promissory notes (PROVIDED, HOWEVER,
         that the acceptance of such notes does not conflict with Section 402 of
         the Sarbanes-Oxley Act of 2002), other securities, other Awards or
         other property or any combination thereof), and may be made in a single
         payment or transfer, in installments or on a deferred basis, in each
         case in accordance with rules and procedures established by the
         Committee. Such rules and procedures may include, without limitation,
         provisions for the payment or crediting of reasonable interest on
         installment or deferred payments or the grant or crediting of Dividend
         Equivalents with respect to installment or deferred payments.

                  (iv) LIMITS ON TRANSFER OF AWARDS. No Award (other than Other
         Stock Grants) and no right under any such Award shall be transferable
         by a Participant otherwise than by will or by the laws of descent and
         distribution and the Company shall not be required

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         to recognize any attempted assignment of such rights by any
         Participant; PROVIDED, HOWEVER, that, if so determined by the
         Committee, a Participant may, in the manner established by the
         Committee, designate a beneficiary or beneficiaries to exercise the
         rights of the Participant and receive any property distributable with
         respect to any Award upon the death of the Participant; and PROVIDED,
         FURTHER, that, if so determined by the Committee, a Participant may
         transfer a Non-Qualified Stock Option to any Family Member (as such
         term is defined in the General Instructions to Form S-8 (or successor
         to such Instructions or such Form)) at any time that such Participant
         holds such Stock Option, whether directly or indirectly or by means of
         a trust or partnership or otherwise, PROVIDED that the Participant may
         not receive any consideration for such transfer, the Family Member may
         not make any subsequent transfers other than by will or by the laws of
         descent and distribution and the Company receives written notice of
         such transfer. Except as otherwise determined by the Committee, each
         Award (other than an Incentive Stock Option) or right under any such
         Award shall be exercisable during the Participant's lifetime only by
         the Participant or, if permissible under applicable law, by the
         Participant's guardian or legal representative. Except as otherwise
         determined by the Committee, no Award (other than an Incentive Stock
         Option) or right under any such Award may be pledged, alienated,
         attached or otherwise encumbered, and any purported pledge, alienation,
         attachment or other encumbrance thereof shall be void and unenforceable
         against the Company or any Affiliate.

                  (v) TERM OF AWARDS. Subject to Section 6(a)(ii) of the Plan,
         the term of each Award shall be for such period as may be determined by
         the Committee.

                  (vi) RESTRICTIONS. All Shares or other securities delivered
         under the Plan pursuant to any Award or the exercise thereof shall be
         subject to such stop transfer orders and other restrictions as the
         Committee may deem advisable under the Plan, applicable federal or
         state securities laws and regulatory requirements, and the Committee
         may direct appropriate stop transfer orders and cause other legends to
         be placed on the certificates for such Shares or other securities to
         reflect such restrictions.

SECTION 7. CHANGE IN CONTROL

         (a) IMPACT OF EVENT. Notwithstanding any other provision of the Plan to
the contrary, unless otherwise provided by the Committee in any Award Agreement,
in the event of a Change in Control:

                  (i) Any Stock Options and Stock Appreciation Rights
         outstanding as of the date of such Change in Control, and which are
         not then exercisable and vested, shall become fully exercisable and
         vested.

                  (ii) The restrictions and deferral limitations applicable to
         any Restricted Stock and Restricted Stock Units shall lapse, and such
         Restricted Stock and Restricted Stock Units shall become free of all
         restrictions and become fully vested.

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                   (iii) All Performance Awards shall be considered to be earned
         and payable in full, and any deferral or other restriction shall lapse
         and such Performance Awards shall be settled in cash or Shares, as
         determined by the Committee, as promptly as is practicable.

                   (iv) All restrictions on other Awards shall lapse and such
         Awards shall become free of all restrictions and become fully vested.

         (b) DEFINITION OF CHANGE IN CONTROL. For purposes of the Plan, a
"Change in Control" shall mean the happening of any of the following events:

                   (i) An acquisition by any individual, entity or group
         (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange
         Act) (a "PERSON") of beneficial ownership (within the meaning of
         Rule 13d-3 promulgated under the Exchange Act) of 20% or more of
         either (1) the then outstanding shares of common stock of the
         Company (the "OUTSTANDING COMPANY COMMON STOCK") or (2) the combined
         voting power of the then outstanding voting securities of the
         Company entitled to vote generally in the election of directors (the
         "OUTSTANDING COMPANY VOTING SECURITIES"); excluding, however, the
         following: (1) Any acquisition directly from the Company, other than
         an acquisition by virtue of the exercise of a conversion privilege
         unless the security being so converted was itself acquired directly
         from the Company, (2) Any acquisition by the Company, (3) Any
         acquisition by any employee benefit plan (or related trust)
         sponsored or maintained by the Company or any entity controlled by
         the Company, or (4) Any acquisition pursuant to a transaction which
         complies with clauses (1), (2) and (3) of subsection (iii) of this
         Section 7(b); or

                   (ii) A change in the composition of the Board such that
         the individuals who, as of the Effective Date, constitute the Board
         (such Board shall be hereinafter referred to as the "INCUMBENT
         BOARD") cease for any reason to constitute at least a majority of
         the Board; PROVIDED, HOWEVER, for purposes of this Section 7(b),
         that any individual who becomes a member of the Board subsequent to
         the Effective Date, whose election, or nomination for election by
         the Company's shareholders, was approved by a vote of at least a
         majority of those individuals who are members of the Board and who
         were also members of the Incumbent Board (or deemed to be such
         pursuant to this proviso) shall be considered as though such
         individual were a member of the Incumbent Board; but, PROVIDED,
         FURTHER, that any such individual whose initial assumption of office
         occurs as a result of an actual or threatened election contest with
         respect to the election or removal of directors or other actual or
         threatened solicitation of proxies or consents by or on behalf of a
         Person other than the Board shall not be so considered as a member
         of the Incumbent Board; or

                   (iii) Consummation of a reorganization, merger or
         consolidation or sale or other disposition of all or substantially
         all of the assets of the Company ("CORPORATE TRANSACTION");
         excluding, however, such a Corporate Transaction pursuant to which
         (1) all or substantially all of the individuals and entities who are
         the beneficial owners, respectively, of the Outstanding Company
         Common Stock and Outstanding Company Voting Securities immediately
         prior to such Corporate Transaction will beneficially own, directly
         or indirectly, more than 50% of, respectively, the outstanding
         shares of common stock, and the combined voting power of the

                                       12

<Page>

         then outstanding voting securities entitled to vote generally in the
         election of directors, as the case may be, of the corporation
         resulting from such Corporate Transaction (including, without
         limitation, a corporation which as a result of such transaction owns
         the Company or all or substantially all of the Company's assets
         either directly or through one or more subsidiaries) in
         substantially the same proportions as their ownership, immediately
         prior to such Corporate Transaction, of the Outstanding Company
         Common Stock and Outstanding Company Voting Securities, as the case
         may be, (2) no Person (other than the Company, any employee benefit
         plan (or related trust) of the Company or such corporation resulting
         from such Corporate Transaction) will beneficially own, directly or
         indirectly, 20% or more of, respectively, the outstanding shares of
         common stock of the corporation resulting from such Corporate
         Transaction or the combined voting power of the outstanding voting
         securities of such corporation entitled to vote generally in the
         election of directors except to the extent that such ownership
         existed prior to the Corporate Transaction, and (3) individuals who
         were members of the Incumbent Board will constitute at least a
         majority of the members of the board of directors of the corporation
         resulting from such Corporate Transaction; or

                   (iv) The approval by the shareholders of the Company of a
         complete liquidation or dissolution of the Company.

SECTION 8. INCOME TAX WITHHOLDING

         No later than the date as of which an amount first becomes includible
in the gross income of a Participant for federal income tax purposes with
respect to any Award under the Plan, the Participant shall pay to the Company,
or make arrangements satisfactory to the Company regarding the payment of, any
federal, state, local or foreign taxes of any kind required by law to be
withheld with respect to such amount. The obligations of the Company under the
Plan shall be conditional on such payment or arrangements, and the Company and
its Affiliates shall, to the extent permitted by law, be entitled to take such
action and establish such procedures as it deems appropriate to withhold or
collect all applicable payroll, withholding, income or other taxes from such
Participant. In order to assist a Participant in paying all or a portion of the
federal, state, local and foreign taxes to be withheld or collected upon
exercise or receipt of (or the lapse of restrictions relating to) an Award, the
Committee, in its discretion and subject to such additional terms and conditions
as it may adopt, may permit the Participant to satisfy such tax obligation by
(i) electing to have the Company withhold a portion of the Shares or other
property otherwise to be delivered upon exercise or receipt of (or the lapse of
restrictions relating to) such Award with a Fair Market Value equal to the
amount of such taxes or (ii) delivering to the Company Shares or other property
other than Shares issuable upon exercise or receipt of (or the lapse of
restrictions relating to) such Award with a Fair Market Value equal to the
amount of such taxes, PROVIDED that, in either case, not more than the legally
required minimum withholding may be settled with Shares. Any such election must
be made on or before the date that the amount of tax to be withheld is
determined.

                                       13

<Page>

SECTION 9. AMENDMENT AND TERMINATION

         (a) AMENDMENTS TO THE PLAN. The Board may amend, alter, suspend,
discontinue or terminate the Plan at any time; PROVIDED, HOWEVER, that,
notwithstanding any other provision of the Plan or any Award Agreement, without
the approval of the stockholders of the Company, no amendment, alteration,
suspension, discontinuation or termination shall be made that, absent such
approval:

                  (i) requires stockholder approval under the rules or
         regulations of the New York Stock Exchange, any other securities
         exchange or the National Association of Securities Dealers, Inc. that
         are applicable to the Company;

                  (ii) increases the number of Shares authorized under the Plan
         as specified in Section 4(a) of the Plan; or

                  (iii) without such stockholder approval, would cause the
         Company to be unable, under the Code, to grant Incentive Stock Options
         under the Plan.

         (b) AMENDMENTS TO AWARDS. The Committee may waive any conditions of or
rights of the Company under any outstanding Award, prospectively or
retroactively. Except as otherwise provided herein or in an Award Agreement, the
Committee may not amend, alter, suspend, discontinue or terminate any
outstanding Award, prospectively or retroactively, if such action would
adversely affect the rights of the holder of such Award, without the consent of
the Participant or holder or beneficiary thereof or such amendment would cause a
Qualified Performance-Based Award to cease to qualify for the Section 162(m)
Exemption.

         (c) CORRECTION OF DEFECTS, OMISSIONS AND INCONSISTENCIES. The Committee
may correct any defect, supply any omission or reconcile any inconsistency in
the Plan or any Award in the manner and to the extent it shall deem desirable to
carry the Plan into effect.

SECTION 10. GENERAL PROVISIONS

         (a) NO RIGHTS TO AWARDS. No Eligible Individual or other person shall
have any claim to be granted any Award under the Plan, and there is no
obligation for uniformity of treatment of Eligible Individuals or holders or
beneficiaries of Awards under the Plan. The terms and conditions of Awards need
not be the same with respect to any Participant or with respect to different
Participants.

         (b) AWARD AGREEMENTS. No Participant will have rights under an Award
granted to such Participant unless and until an Award Agreement shall have been
duly executed on behalf of the Company and, if requested by the Company, signed
by the Participant. In the event that any provision of an Award Agreement
conflicts with or is inconsistent in any respect with the terms of the Plan as
set forth herein or subsequently amended, the terms of the Plan shall control.

                                       14

<Page>

         (c) NO RIGHTS OF STOCKHOLDERS. Except with respect to Shares of
Restricted Stock as to which the Participant has been granted the right to vote,
neither a Participant nor the Participant's legal representative shall be, or
have any of the rights and privileges of, a stockholder of the Company with
respect to any Shares issuable to such Participant upon the exercise or payment
of any Award, in whole or in part, unless and until such Shares have been issued
in the name of such Participant or such Participant's legal representative
without restrictions thereto.

         (d) NO LIMIT ON OTHER COMPENSATION PLANS OR ARRANGEMENTS. Nothing
contained in the Plan shall prevent the Company or any Affiliate from adopting
or continuing in effect other or additional compensation arrangements, and such
arrangements may be either generally applicable or applicable only in specific
cases.

         (e) NO RIGHT TO EMPLOYMENT. The Plan shall not constitute a contract of
employment, and adoption of the Plan or the grant of an Award shall not be
construed as giving a Participant the right to be retained as an employee of the
Company or an Affiliate, or a non-employee Director to be retained as a
Director, nor shall it affect in any way the right of the Company or an
Affiliate to terminate such employment at any time, with or without cause. In
addition, the Company or an Affiliate may at any time dismiss a Participant from
employment free from any liability or any claim under the Plan or any Award,
unless otherwise expressly provided in the Plan or in any Award Agreement.

         (f) GOVERNING LAW. The Plan and all Awards granted and actions taken
thereunder shall be governed by and construed in accordance with the laws of the
State of Delaware, without reference to principles of conflict of laws thereof.

         (g) SEVERABILITY. If any provision of the Plan or any Award is or
becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction
or would disqualify the Plan or any Award under any law deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to
applicable laws, or if it cannot be so construed or deemed amended without, in
the determination of the Committee, materially altering the purpose or intent of
the Plan or the Award, such provision shall be stricken as to such jurisdiction
or Award, and the remainder of the Plan or any such Award shall remain in full
force and effect.

         (h) APPLICATION TO PARTICIPANTS OUTSIDE THE UNITED STATES. In the event
an Award is granted to a Participant who is employed or providing services
outside the United States and who is not compensated from a payroll maintained
in the United States, the Committee may, in its sole discretion, modify the
provisions of the Plan as they pertain to such individual to comply with
applicable foreign law.

         (i) NO TRUST OR FUND CREATED. Neither the Plan nor any Award shall
create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Company or any Affiliate and an Eligible
Individual or any other person. To the extent that any person acquires a right
to receive payments from the Company or any Affiliate pursuant to an

                                       15

<Page>

Award, such right shall be no greater than the right of any unsecured general
creditor of the Company or any Affiliate.

         (j) OTHER BENEFITS. No compensation or benefit awarded to or realized
by any Participant under the Plan shall be included for the purpose of computing
such Participant's compensation under any compensation-based retirement,
disability, or similar plan of the Company unless required by law or otherwise
provided by such other plan.

         (k) NO FRACTIONAL SHARES. No fractional Shares shall be issued or
delivered pursuant to the Plan or any Award, and the Committee shall determine
whether cash shall be paid in lieu of any fractional Shares or whether such
fractional Shares or any rights thereto shall be canceled, terminated or
otherwise eliminated.

         (l) HEADINGS. Headings are given to the Sections and subsections of the
Plan solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation of
the Plan or any provision thereof.

         (m) SECTION 16 COMPLIANCE; SECTION 162(m) ADMINISTRATION. The Plan is
intended to comply in all respects with Rule 16b-3 or any successor provision,
as in effect from time to time, and in all events the Plan shall be construed in
accordance with the requirements of Rule 16b-3. If any Plan provision does not
comply with Rule 16b-3 as hereafter amended or interpreted, the provision shall
be deemed inoperative. The Board, in its absolute discretion, may bifurcate the
Plan so as to restrict, limit or condition the use of any provision of the Plan
with respect to persons who are officers or directors subject to Section 16 of
the Exchange Act without so restricting, limiting or conditioning the Plan with
respect to other Eligible Individuals. The Company intends that all Stock
Options and Stock Appreciation Rights granted under the Plan to individuals who
are or who the Committee believes will be Covered Employees will constitute
"qualified performance-based compensation" within the meaning of Section 162(m)
of the Code.

         (n) CONDITIONS PRECEDENT TO ISSUANCE OF SHARES. Shares shall not be
issued pursuant to the exercise or payment of the Exercise Price or purchase
price relating to an Award unless such exercise or payment and the issuance and
delivery of such Shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933,
as amended from time to time, the Exchange Act, the rules and regulations
promulgated thereunder, the requirements of any applicable stock exchange and
the Delaware General Corporation Law. As a condition to the exercise or
payment of the Exercise Price or purchase price relating to such Award, the
Company may require that the person exercising or paying the Exercise Price
or purchase price represent and warrant that the Shares are being purchased
only for investment and without any present intention to sell or distribute
such Shares if, in the opinion of counsel for the Company, such a
representation and warranty is required by law.

                                       16

<Page>

SECTION 11. EFFECTIVE DATE OF PLAN

         Upon its adoption by the Board, the Plan shall be submitted for
approval by the stockholders of the Company and shall be effective as of the
date of such approval (the "EFFECTIVE DATE").

SECTION 12. TERM OF THE PLAN

         The Plan will terminate on the tenth anniversary of the Effective Date
or any earlier date of discontinuation or termination established pursuant to
Section 9 of the Plan. However, unless otherwise expressly provided in the Plan
or in an applicable Award Agreement, any Award theretofore granted may extend
beyond such date, and the authority of the Committee provided for hereunder with
respect to the Plan and any Awards, and the authority of the Board to amend the
Plan, shall extend beyond the termination of the Plan.

                                       17<Page>

                                                                    Exhibit 10.6

                   FORM OF SUBORDINATED LOAN AGREEMENT - CASH

THIS  AGREEMENT  is  entered  into this _____ day of  ___________________  2003,
between USB Holdings,  Inc. (the "Lender") and U.S.  Bancorp Piper Jaffray Inc.,
(the "Organization").

                  1. GENERAL

                  Subject to the terms and conditions hereinafter set forth, the
Organization promises to pay to the Lender or its assigns, (a) on October 31,
2008 (the "Scheduled Maturity Date") at the office of the Organization, the
principal amount of $180,000,000 plus accrued and unpaid interest as of the
Scheduled Maturity Date (treating the Scheduled Maturity Date as the Interest
Payment Date for the purpose of calculating the Interest Rate applicable to the
period since the last Interest Payment Date) and (b) on _____________ and the
first business banking day in Minneapolis, Minnesota of each calendar quarter
thereafter (each such date, an "Interest Payment Date"), interest on the
principal amount then outstanding at the Interest Rate. All payments made by the
Organization hereunder, both principal and interest, shall be noted in the books
and records of the Lender and shall be conclusive evidence of the amounts of
such payments absent manifest error. For the purposes of this Agreement,
"Interest Rate" means, for each Interest Payment Date, an interest rate per
annum equal to the London Interbank Offer Rate for three-month Eurodollar
deposits, as reported on Telerate page 3750 two London business days prior to
the immediately preceding Interest Payment Date (or, in the case of the first
Interest Payment Date, two London business days prior to the date hereof)
calculated on an actual/360 day basis, plus 150 basis points, such Interest Rate
to be reset on each subsequent Interest Payment Date.

                  2. SUSPENDED REPAYMENT

                  The Organization's obligation to pay the principal amount
hereof on the Scheduled Maturity Date or any accelerated maturity date shall be
suspended and the obligation shall not mature for any period of time during
which after giving effect to such payment (together with (a) the payment of any
other obligation of the Organization payable at or prior to the payment hereof
and (b) the return of any Secured Demand Note and the Collateral therefor held
by the Organization and returnable at or prior to the payment hereof).

                  (i)      in the event that the Organization is not operating
                           pursuant to the alternative net capital requirement
                           provided for in paragraph (a)(1)(ii) of Rule 15c3-1
                           (the "Rule") under the Securities Exchange Act of
                           1934, as amended (the "Act"), the aggregate
                           indebtedness of the Organization would exceed 1200
                           percent of its net capital as those terms are defined
                           in the Rule or any successor rule as in effect at the
                           time payment is to be made, or such other percent as
                           may be made applicable to the Organization at the
                           time of such payment by the New York Stock Exchange,
                           Inc. (the "Exchange") or the Securities and Exchange
                           Commission (the "SEC"), or

                  (ii)     in the event that the Organization is operating
                           pursuant to such alternative net capital requirement,
                           the net capital of the Organization would be less

                                       1
<Page>

                           than 5 percent (or such other percent as may be made
                           applicable to the Organization at the time of such
                           payment by the Exchange or the SEC) of aggregate
                           debit items computed in accordance with Exhibit A to
                           Rule 15c3-3 under the Act or any successor rule as in
                           effect at such time, or

                  (iii)    in the event that the Organization is registered as a
                           futures commission merchant under the Commodity
                           Exchange Act (the "CEA"), the net capital of the
                           Organization (as defined in the CEA or the
                           regulations thereunder as in effect at the time of
                           such payment) would be less than 6 percent (or such
                           other percentum as may be made applicable to the
                           Organization at the time of such payment by the
                           Commodity Futures Trading Commission (the "CFTC") of
                           the funds required to be segregated pursuant to the
                           CEA and the regulations thereunder, and the foreign
                           futures or foreign options secured amount less the
                           market value of commodity options purchased by
                           customers on or subject to the rules of a contract
                           market or a foreign board of trade (provided,
                           however, the deduction for each customer shall be
                           limited to the amount of customer funds in such
                           customer's account(s) and foreign futures and foreign
                           options secured amounts), or the Organization's net
                           capital would be less than the minimum capital
                           requirement as defined by the DSRO, or

                  (iv)     the Organization's net capital, as defined in the
                           Rule or any successor rule as in effect at the time
                           of such payment, would be less than 120 percent (or
                           such other percent as may be made applicable to the
                           Organization at the time of such payment by the
                           Exchange or the SEC) of the minimum dollar amount
                           required by the Rule as in effect at such time (or
                           such other dollar amount as may be made applicable to
                           the Organization at the time of such payment by the
                           Exchange or the SEC), or

                  (v)      in the event that the Organization is registered as a
                           futures commission merchant under the CEA and if its
                           net capital, as defined in the CEA or the regulations
                           thereunder as in effect at the time of such payment,
                           would be less than 120 percent (or such other percent
                           as may be made applicable to the Organization at the
                           time of such payment by the CFTC) of the minimum
                           dollar amount required by the CEA or the regulations
                           thereunder as in effect at such time (or such other
                           dollar amount as may be made applicable to the
                           Organization at the time of such payment by the
                           CFTC), or

                  (vi)     in the event that the Organization is subject to the
                           provisions of Paragraph (a)(6)(v) or (c)(2)(x)(C) of
                           the Rule, the net capital of the Organization would
                           be less than the amount required to satisfy the 1000
                           percent test (or such other percentum test as may be
                           made applicable to the Organization at the time of
                           such payment by the Exchange or the SEC) stated in
                           such applicable paragraph,

                                       2
<Page>

(the net capital necessary to enable the Organization to avoid such suspension
of its obligation to pay the principal amount hereof being hereinafter referred
to as the "Applicable Minimum Capital") and during any such suspension the
Organization shall, as promptly as consistent with the protection of its
customers, reduce its business to a condition whereby the principal amount
hereof with accrued interest thereon could be paid (together with (a) the
payment of any other obligation of the Organization payable at or prior to the
payment hereof and (b) the return of any Secured Demand Note and the Collateral
therefor held by the Organization and returnable at or prior to the payment
hereof) without the Organization's net capital being below the Applicable
Minimum Capital, at which time the Organization shall repay the principal amount
hereof plus accrued interest thereon on not less than five days' prior written
notice to the Exchange. The aggregate principal amount outstanding pursuant to
this Agreement shall mature on the first day at which under this paragraph the
Organization has an obligation to pay the principal amount hereof. If pursuant
to the terms hereof the Organization's obligation to pay the principal amount
hereof is suspended and does not mature, the Organization agrees (and the Lender
recognizes) that if the Organization's obligation to pay the principal amount
hereof is ever suspended for a period of six months or more, it will promptly
take whatever steps are necessary to effect a rapid and orderly complete
liquidation of its business. If payment is made of all or any part of the
principal hereof on the Scheduled Maturity Date or any accelerated maturity date
and if immediately after any such payment the Organization's net capital is less
than the Applicable Minimum Capital, the Lender agrees irrevocably (whether or
not such Lender had any knowledge or notice of such fact at the time of any such
payment) to repay to the Organization, its successors or assigns, the sum so
paid, to be held by the Organization pursuant to the provisions hereof as if
such payment had never been made; provided, however, that any suit for the
recovery of any such payment must be commenced within two years of the date of
such payment.

                  3. SUBORDINATION OF THE OBLIGATIONS

                  The Lender irrevocably agrees that the obligations of the
Organization under this Agreement with respect to the payment of principal and
interest are and shall be fully and irrevocably subordinate in right of payment
and subject to the prior payment or provision for payment in full of all claims
of all other present and future creditors of the Organization whose claims are
not similarly subordinated (claims hereunder shall rank pari passu with claims
similarly subordinated) and to claims which are now or hereafter expressly
stated in the instruments creating such claims to be senior in right of payment
to the claims of the class of this claim arising out of any matter occurring
prior to the date on which the Organization's obligation to make such payment
matures consistent with the provisions hereof. In the event of the appointment
of a receiver or trustee of the Organization or in the event of its insolvency,
liquidation pursuant to the Securities Investor Protection Act of 1970 ("SIPA")
or otherwise, its bankruptcy, assignment for the benefit of creditors,
reorganization whether or not pursuant to bankruptcy laws, or any other
marshalling of the assets and liabilities of the Organization, the holder hereof
shall not be entitled to participate or share, ratably or otherwise, in the
distribution of the assets of the Organization until all claims of all other
present and future creditors of the Organization, whose claims are senior
hereto, have been fully satisfied, or adequate provision has been made therefor.

                                       3
<Page>

                  4. PERMISSIVE PREPAYMENT

                  With the prior written approval of the Exchange, the
Organization may, at its option, make Prepayment of all or any portion of the
principal amount hereof to the Lender prior to the Scheduled Maturity Date at
any time subsequent to one year from the effective date of this Agreement. No
Prepayment shall be made, however, if after giving effect thereto (and to all
other payments of principal of outstanding subordination agreements of the
Organization, including the return of any Secured Demand Note and the Collateral
therefor held by the Organization, the maturity or accelerated maturity of which
are scheduled to occur within six months after the date such Prepayment is to
occur pursuant to the provisions of this paragraph, or on or prior to the
Scheduled Maturity Date for payment of the principal amount hereof disregarding
this paragraph, whichever date is earlier) without reference to any projected
profit or loss of the Organization.

                  (i)      in the event that the Organization is not operating
                           pursuant to the alternative net capital requirement
                           provided for in paragraph (a)(1)(ii) of the Rule, the
                           aggregate indebtedness of the Organization would
                           exceed 1000 percent of its net capital as those terms
                           are defined in the Rule or any successor rule as in
                           effect at the time such Prepayment is to be made (or
                           such other percent as may be made applicable at such
                           time to the Organization by the Exchange or the SEC),
                           or

                  (ii)     in the event that the Organization is operating
                           pursuant to such alternative net capital requirement,
                           the net capital of the Organization would be less
                           than 5 percent (or such other percent as may be made
                           applicable to the Organization at the time of such
                           Prepayment by the Exchange or the SEC) of aggregate
                           debit items computed in accordance with Exhibit A to
                           Rule 15c3-3 under the Act or any successor rule as in
                           effect at such time, or

                  (iii)    in the event that the Organization is registered as a
                           futures commission merchant under the CEA, the net
                           capital of the Organization (as defined in the CEA or
                           the regulations thereunder as in effect at the time
                           of such Prepayment) would be less than 7 percent (or
                           such other percent as may be made applicable to the
                           Organization at the time of such Prepayment by the
                           CFTC) of the funds required to be segregated pursuant
                           to the CEA and the regulations thereunder, and the
                           foreign futures or foreign options secured amount
                           less the market value of commodity options purchased
                           by customers of the Organization on or subject to the
                           rules of a contract market or a foreign board of
                           trade (provided, however, the deduction for each
                           customer shall be limited to the amount of customer
                           funds in such customer's account(s) and foreign
                           futures and foreign options secured amounts) or the
                           Organization's net capital would be less than the
                           minimum capital requirement as defined by the DSRO,
                           or

                  (iv)     the Organization's net capital, as defined in the
                           Rule or any successor rule as in effect at the time
                           of such Prepayment, would be less than 120 percent
                           (or such other percent as may be made applicable to
                           the Organization at

                                       4
<Page>

                           the time of such Prepayment by the Exchange or the
                           SEC) of the minimum dollar amount required by the
                           Rule as in effect at such time (or such other dollar
                           amount as may be made applicable to the Organization
                           at the time of such Prepayment by the Exchange or the
                           SEC), or

                  (v)      in the event that the Organization is registered as a
                           futures commission merchant under the CEA, its net
                           capital, as defined in the CEA or the regulations
                           thereunder as in effect at the time of such
                           Prepayment would be less than 120 percent (or such
                           other percent as may be made applicable to the
                           Organization at the time of such Prepayment by the
                           CFTC) of the minimum dollar amount required by the
                           CEA or the regulations thereunder as in effect at
                           such time or such other dollar amount as may be made
                           applicable to the Organization at the time of such
                           Prepayment by the CFTC, or

                  (vi)     in the event that the Organization is subject to the
                           provisions of paragraph (a)(6)(v) or (c)(2)(x)(C) of
                           the Rule, the net capital of the Organization would
                           be less than the amount required to satisfy the 1000
                           percent test (or such other percent test as may be
                           made applicable to the Organization at the time of
                           such Prepayment by the Exchange or the SEC) stated in
                           such applicable paragraph, or

                  (vii)    in the event that the Prepayment occurs more than 12
                           months prior to the Scheduled Maturity Date, as
                           herein defined, the Organization would not be in
                           compliance with the provisions of paragraph (e) of
                           the Rule and, if applicable, Section 1.17(e) of the
                           Regulations under the CEA.

If Prepayment is made of all or any part of the principal hereof prior to the
Scheduled Maturity Date and if the Organization's net capital is less than the
amount required to permit such Prepayment pursuant to the foregoing provisions
of this Paragraph, the Lender agrees irrevocably (whether or not such Lender had
any knowledge or notice of such fact at the time of such Prepayment) to repay
the Organization, its successor or assigns, the sum so paid to be held by the
Organization pursuant to the provisions hereof as if such Prepayment had never
been made; provided, however, that any suit for the recovery of any such
Prepayment must be commenced within two years of the date of such Prepayment.

                  5. AFFIRMATIVE COVENANTS.

                  Until all amounts hereunder, both principal and interest, have
been paid in full to the Lender, the Organization covenants and agrees with the
Lender that:

                  (i)      MINIMUM NET WORTH. The Organization will not permit
                           at any time the amount which, in conformity with
                           GAAP, is included under the caption "Shareholders'
                           Equity" (or any like caption) on the balance sheet of
                           the Organization (such amount, the Organization's
                           "Net Worth") to be less than $200,000,000.

                                       5
<Page>

                  (ii)     MINIMUM NET CAPITAL. The Organization will not permit
                           at any time its net capital (as defined by the
                           Exchange) to be less than $50,000,000 for a period of
                           30 consecutive days.

                  6. REPRESENTATIONS AND WARRANTIES

                  The Organization hereby represents and warrants to the Lender
that, as of the date of this Agreement:

                  (i)      CORPORATE EXISTENCE. The Organization has been duly
                           organized, and is validly existing and in good
                           standing, under the laws of its jurisdiction of
                           incorporation or formation and has the requisite
                           power and authority and all necessary governmental
                           approvals to own, lease and operate its properties
                           and to carry on its business as it is now being
                           conducted, except where the failure to be so
                           organized, existing or in good standing or to have
                           such power, authority and governmental approvals
                           would not, individually or in the aggregate,
                           reasonably be expected to have a material adverse
                           effect on the financial condition, operations,
                           assets, business, prospects or properties of the
                           Organization. The Organization is duly qualified or
                           licensed to do business, and is in good standing, in
                           each jurisdiction where the character of the
                           properties owned, leased or operated by it or the
                           nature of its business makes such qualification or
                           licensing or good standing necessary, except for such
                           failures to be so qualified or licensed and in good
                           standing that would not, individually or in the
                           aggregate, reasonably be expected to have a material
                           adverse effect on the financial condition,
                           operations, assets, business, prospects or properties
                           of the Organization.

                  (ii)     AUTHORITY. The Organization has full corporate power
                           and authority to execute and deliver this Agreement
                           and to perform its obligations hereunder in
                           accordance with its terms. The Agreement has received
                           all necessary approvals of the Board of Directors of
                           the Organization, and no other corporate proceedings
                           on the part of the Organization are necessary to
                           authorize the execution and delivery of this
                           Agreement or the consummation by the Organization of
                           the transactions contemplated hereby. The Agreement
                           has been duly executed and delivered by the
                           Organization, and, assuming the due authorization,
                           execution and delivery hereof by the Organization,
                           constitutes a valid and legally binding agreement of
                           the Organization, enforceable against the
                           Organization in accordance with its terms.

                  (iii)    CONSENTS; NO CONFLICTS. Entrance by the Organization
                           into this Agreement (a) does not require any consent
                           or approval of, registration or filing with, or any
                           other action by, any governmental authority, except
                           such as have been obtained or made and are in full
                           force and effect as of the date hereof, (b) will not
                           violate any applicable law or regulation or the
                           charter, by-laws or other organizational documents of
                           the Organization or

                                       6
<Page>

                           any order of any governmental authority, (c) will not
                           violate or result in a default under, or give rise to
                           a right to require any material payment under, any
                           indenture, agreement or other instrument binding upon
                           the Organization or any of its assets and (d) will
                           not result in the creation or imposition of any lien
                           on any material asset of the Organization.

                  7.       ACCELERATION IN EVENT OF INSOLVENCY

                           The Organization's obligation to pay the unpaid
                           principal amount hereof shall forthwith mature,
                           together with interest accrued thereon, in the event
                           of any receivership, insolvency, liquidation pursuant
                           to SIPA or otherwise, bankruptcy, assignment for the
                           benefit of creditors, reorganization whether or not
                           pursuant to bankruptcy laws, or any other marshalling
                           of the assets and liabilities of the Organization;
                           but payment of the same shall remain subordinate as
                           hereinabove set forth.

                  8.       EVENTS OF ACCELERATION

                  If any of the following events (each an "Event of
Acceleration") occur:

                  (i)      the Organization fails to pay any amount due under
                           this Agreement when the same becomes due and payable,
                           and such failure continues for thirty days after
                           notice thereof by the Lender to the Organization;

                  (ii)     any material representation or warranty made by the
                           Organization in this Agreement proves to have been
                           inaccurate in any material respect at the time made;
                           or

                  (iii)    the Organization fails to perform any covenant
                           contained in this Agreement relating to the conduct
                           of the business of the Organization or relating to
                           the maintenance and reporting of the Organization's
                           financial position, including those covenants set
                           forth in Section 5 hereof, and such failure shall
                           continue unremedied for a period of 30 days after
                           notice thereof from the Lender to the Organization;

then, and in every such event, and at any time thereafter during the continuance
of such event, the Lender may elect, by written notice to the Organization and
the Examining Authority, to declare the entire amount outstanding hereunder to
be due and payable in full as of the last business day of the calendar month
which is six months after the date such notice is received by the Organization
and the Examining Authority, whereupon the entire such amount shall be and
become due and payable on such date; and PROVIDED that, in accordance with the
Rules under the Act, the Lender shall not be permitted to exercise its rights
and remedies pursuant to this Section 7 by delivery of such notice prior to the
date that is six months after the Effective Date (as defined in Section 18
hereof). No course of dealing and no delay on the part of the Lender in
exercising any right, power or remedy will operate as a waiver thereof or
otherwise prejudice the Lender's rights, powers or remedies. No right, power or
remedy conferred hereby is exclusive of

                                       7
<Page>

any other right, power or remedy referred to herein or now or hereafter
available at law, in equity, by statute or otherwise.

                  9. EVENTS OF DEFAULT

                  If any of the following events (each an "Event of Default")
occur:

                  (i)      the Organization is the subject of any receivership,
                           insolvency, liquidation pursuant to SIPA or
                           otherwise, bankruptcy, assignment for the benefit of
                           creditors, reorganization whether or not pursuant to
                           bankruptcy laws, or there is any other marshalling of
                           the assets and liabilities of the Organization;

                  (ii)     the SEC revokes the registration of the Organization;
                           or

                  (iii)    the Examining Authority suspends (and does not
                           reinstate within ten (10) days) or revokes the
                           Organization's status as a member of the Exchange.

then, and in every such event (other than an event with respect to the
Organization described in clause (i) of this Section as a result of which the
Lender shall not be permitted, without special relief, to exercise its rights or
remedies), and at any time thereafter during the continuance of such event, the
Lender may elect, by written notice to the Organization and the Examining
Authority, to declare the entire amount outstanding hereunder to be due and
payable in full, whereupon the entire such amount shall be and become due and
payable on date of such notice; PROVIDED, HOWEVER, that that no such notice
shall be required in the event of occurrence of the event specified in clause
(i) of this Section, and if any such event shall occur all amounts outstanding
hereunder shall immediately and automatically be and become due and payable in
full without notice or declaration of any kind; and PROVIDED FURTHER that, in
accordance with the Rules under the Act, if a liquidation of the business of the
Organization has not been commenced, the date on which such Event of Default
occurs shall be the date on which the payment obligations of the Organization
with respect to all other subordination agreements then outstanding shall
mature. Upon the happening of an Event of Default, if liquidation of the
business of the Organization has not already occurred, the Organization shall
undertake to rapidly and orderly liquidate its business. No course of dealing
and no delay on the part of the Lender in exercising any right, power or remedy
will operate as a waiver thereof or otherwise prejudice the Lender's rights,
powers or remedies. No right, power or remedy conferred hereby is exclusive of
any other right, power or remedy referred to herein or now or hereafter
available at law, in equity, by statute or otherwise.

                  10. EFFECT OF DEFAULT

                  Default in any payment hereunder, including the payment of
interest, shall not accelerate the maturity hereof except as herein specifically
provided, and the obligation to make payment shall remain subordinated as herein
above set forth.

                                       8
<Page>

                  11. EFFECT OF ACCELERATION AND DEFAULT

                  The occurrence of any Event of Acceleration or Event of
Default shall not accelerate the maturity hereof except as herein specifically
provided, and the obligation to make payment shall remain subordinated as herein
above set forth.

                  12. NOTICE OF MATURITY OR ACCELERATED MATURITY

                  The Organization shall immediately notify the Examining
Authority for such broker or dealer, if, after giving effect of all Payments of
Payment Obligations (as that term is defined in (a)(2)(iv) of Appendix D of the
Rule) under subordination agreements then outstanding that are then due or
mature within the following six months without reference to any projected profit
or loss of the broker or dealer either the aggregate indebtedness of the broker
or dealer would exceed 1200 percent of its net capital or its net capital would
be less than 120 percent of the minimum dollar amount required by the Rule, or,
in the case of a broker or dealer operating pursuant to paragraph (a)(1)(ii) of
the Rule, its net capital would be less than 5 percent of aggregate debit items
computed in accordance with Exhibit A to Rule 15c3-3 under the Act or any
successor rule as in effect at such time, or, if registered as a futures
commission merchant, 6 percent of the funds required to be segregated pursuant
to the Commodity Exchange Act and the regulations thereunder (less the market
value of commodity options purchased by option customers on or subject to the
rules of a contract market, each such deduction not to exceed the amount of
funds in the option customer's account), if greater, or less than 120 percent of
the minimum dollar amount required by paragraphs (a)(1)(ii) of the Rule.

                  13. NON-LIABILITY OF EXCHANGE

                  The Lender irrevocably agrees that the loan evidenced hereby
is not being made in reliance upon the standing of the Organization as a member
organization of the Exchange or upon the Exchange's surveillance of the
Organization's financial position or its compliance with the Constitution, Rules
and practices of the Exchange. The Lender has made such investigation of the
Organization and its partners, officers, directors and stockholders as the
Lender deems necessary and appropriate under the circumstances. The Lender is
not relying upon the Exchange to provide any information concerning or relating
to the Organization and agrees that the Exchange has no responsibility to
disclose to the Lender any information concerning or relating to the
Organization which it may now, or at any future time, have. The Lender agrees
that neither the Exchange, its Special Trust Fund, nor any director, officer,
trustee nor employee of the Exchange or said Trust Fund shall be liable to the
Lender with respect to this Agreement or the repayment of the loan evidenced
hereby or of any interest thereon.

                  14. STATUS OF PROCEEDS

                  The proceeds hereof shall be dealt with in all respects as
capital of the Organization, shall be subject to the risks of its business, and
may be deposited in an account or accounts in the Organization's name in any
bank or trust company.

                                       9
<Page>

                  15. FUTURES COMMISSION MERCHANTS

                  If the Organization is a futures commission merchant, as that
term is defined in the CEA, the Organization agrees, consistent with the
requirements of Section 1.17(h) of the regulations of the CFTC (17 CFR 1.17(h)),
that:

                  (a)      whenever prior written notice by the Organization to
                           the Exchange is required pursuant to the provisions
                           of this Agreement, the same prior written notice
                           shall be given by the Organization to (i) the CFTC at
                           its principal office in Washington, DC, Attention
                           Chief Accountant of Division of Trading and Markets,
                           and/or (ii) the commodity exchange of which the
                           Organization is a member and which is then designated
                           by the CFTC as the Organization's designated
                           self-regulatory organization (the "DSRO"), and

                  (b)      whenever prior written consent, permission or
                           approval of the Exchange is required pursuant to the
                           provisions of this Agreement, the Organization shall
                           also obtain the prior written consent, permission or
                           approval of the CFTC and/or of the DSRO, and

                  (c)      whenever the Organization receives written notice of
                           acceleration of maturity pursuant to the provisions
                           of this Agreement, the Organization shall promptly
                           give written notice thereof to the CFTC at the
                           address stated and/or to the DSRO.

                  16. DEFINITION OF ORGANIZATION

                  The term "Organization" as used in this Agreement shall
include the Organization, its heirs, executors, administrators, successors and
assigns.

                  17. EFFECT OF EXCHANGE MEMBERSHIP TERMINATION

                  Upon termination of the Organization as a member organization
of the Exchange, the references herein to the Exchange shall be deemed to refer
to the Examining Authority. The term "Examining Authority" shall refer to the
regulatory body having responsibility for inspecting or examining the
Organization for compliance with financial responsibility requirements under
Section 9(c) of SIPA and Section 17(d) of the Act.

                  18. UPON WHOM BINDING

                  The provision of this Agreement shall be binding upon the
Lender, his or its heirs, executors, administrators, successors and assigns and
upon the Organization.

                  19. ARBITRATION

                  Any controversy arising out of or relating to this Agreement
shall be submitted to and settled by arbitration pursuant to the Constitution
and Rules of the Exchange. The Organization and the Lender shall be conclusively
bound by such arbitration.

                                       10
<Page>

                  20. EFFECTIVE DATE

                  This agreement shall be effective from the date on which it is
approved by the Exchange (such date, the "Effective Date") and shall not be
modified or amended without the prior written approval of the Exchange.

                  21. NOTICES

                  All notices, consents, waivers and other communications
required or permitted by this Agreement shall be in writing and shall be deemed
given to a party when (a) delivered to the appropriate address by hand or by
nationally recognized overnight courier service (costs prepaid); (b) sent by
facsimile with confirmation of transmission by the transmitting equipment; or
(c) received or rejected by the addressee, if sent by certified mail, return
receipt requested, in each case to the following addresses and facsimile numbers
and marked to the attention of the person (by name or title) designated below
(or to such other address, facsimile number or person as a party may designate
by notice to the other parties):

                           If to the Lender:

                           USB Holdings, Inc.
                           [ADDRESS]
                           Attention:
                           Facsimile:
                           Telephone:

                           with a copy (which shall not constitute notice) to:

                           Wachtell, Lipton, Rosen & Katz
                           51 West 52nd Street
                           New York, New York  10019
                           Attention:     _____________, Esq.
                           Facsimile:  (212) 403-2000

                           If to the Organization to:

                           U.S. Bancorp Piper Jaffray Inc.
                           800 Nicollet Mall
                           Minneapolis, Minnesota 55402
                           Attention: Sandra G. Sponem
                           Facsimile: 612-303-1321
                           Telephone: 612-303-6000

                  22. ENTIRE AGREEMENT

                  This Agreement embodies the entire agreement between the
Organization and the Lender and no other evidence of such agreement has been or
will be executed without the prior written consent of the Exchange.

                                       11
<Page>

                  23. GOVERNING LAW

                  This Agreement shall be deemed to have been made under, and
shall be governed by, the laws of the State of New York in all respects.

                  24. CANCELLATION

                  This Agreement shall not be subject to cancellation by either
party, unless the New York Stock Exchange agrees in writing to such cancellation
30 days in advance.

                  25. NO RIGHT OF SET-OFF

                  The Lender agrees that it is not taking and will not take or
assert as security for the payment of the loan any security interest in or lien
upon, whether created by contract, statute or otherwise, any property of the
Organization or any property in which the Organization may have an interest,
which is or at any time may be in the possession or subject to the control of
the Lender. The Lender hereby waives, and further agrees that it will not seek
to obtain payment of the note in whole or in any part by exercising any right of
set-off it may assert or possess whether created by contract, statute or
otherwise. Any agreement between the organization and the Lender (whether in the
nature of a general loan and collateral agreement, a security or pledge
agreement or otherwise) shall be deemed amended hereby to the extent necessary
so as not to be inconsistent with the provision of this paragraph.

                                       12
<Page>

                  IN WITNESS HEREOF the parties hereto have set their hands and
seals this _______ day of _________________________, 2003.

U.S. BANCORP PIPER JAFFRAY INC., as            USB HOLDINGS, INC., as the Lender
the Organization

By:                                            By:
   -------------------------------------          ------------------------------

Name:                                          Name:
     -----------------------------------            ----------------------------

Title:                                         Title:
      ----------------------------------             ---------------------------
               (Organization)                              (Lender)

                                       13

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