As filed with the Securities and Exchange Commission on
November 9, 2009
Registration
No. 333-
UNITED STATES SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C.
20549
Form S-3
REGISTRATION
STATEMENT
UNDER
THE SECURITIES ACT OF
1933
THOMAS WEISEL PARTNERS GROUP,
INC.
(Exact Name of Registrant as
Specified in Its Charter)
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Delaware
(State or other jurisdiction
of
incorporation or organization)
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20-3550472
(I.R.S. Employer
Identification No.)
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One Montgomery Street
San Francisco, California 94104
(415) 364-2500
(Address, Including Zip Code,
and Telephone Number,
Including Area Code, of Registrants Principal Executive
Offices)
Mark P. Fisher
Thomas Weisel Partners Group, Inc.
One Montgomery Street
San Francisco, California 94104
(415) 364-2500
(Name, address, including zip
code, and telephone number,
including area code, of agent
for service)
Copies to:
Scott D. Miller
Sarah P. Payne
Sullivan & Cromwell LLP
1870 Embarcadero Road
Palo Alto, California 94303
(650) 461-5600
Approximate date of commencement of proposed sale to the
public:
From time to time after the effective
date of this registration statement, as determined by market and
other conditions.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans,
please check the following
box.
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If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to
Rule 415 under the Securities Act of 1933, other than
securities offered only in connection with dividend or interest
reinvestment plans, check the following
box.
þ
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act,
please check the following box and list the Securities Act
registration statement number of the earlier effective
registration statement for the same
offering.
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If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following
box and list the Securities Act registration statement number of
the earlier effective registration statement for the same
offering.
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If this Form is a registration statement pursuant to General
Instruction I.D. or a post-effective amendment thereto that
shall become effective upon filing with the Commission pursuant
to Rule 462(e) under the Securities Act, check the
following
box.
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If this Form is a post-effective amendment to a registration
statement filed pursuant to General Instruction I.D. filed to
register additional securities or additional classes of
securities pursuant to Rule 413(b) under the Securities
Act, check the following
box.
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Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer
or a smaller reporting company. See the definitions of
large accelerated filer, accelerated
filer and smaller reporting company in
Rule 12b-2 of the Exchange Act. (Check one):
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer
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Smaller reporting company
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(Do not check if a smaller reporting company)
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CALCULATION OF REGISTRATION FEE
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Proposed Maximum
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Proposed Maximum
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Amount of
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Title of Each Class of
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Amount to be
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Offering Price
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Aggregate
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Registration
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Securities to be Registered
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Registered
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Per Unit
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Offering Price
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Fee
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Debt Securities
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(1)
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(1)
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(1)
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N/A
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Preferred Stock
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(1)
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(1)
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(1)
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N/A
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Common Stock
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(1)
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(1)
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(1)
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N/A
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Warrants
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(1)
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(1)
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(1)
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N/A
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Units(2)
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(1)
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(1)
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(1)
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N/A
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Total
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$100,000,000
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(1)
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$100,000,000
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$5,580(3)
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(1)
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There are being registered hereunder such indeterminate
principal amount of Debt Securities, such indeterminate number
of shares of Preferred Stock, such indeterminate number of
shares of Common Stock, such indeterminate number of warrants of
the Registrant and such indeterminate number of Units as shall
have an aggregate initial offering price not to exceed
$100,000,000. If any Debt Securities are issued at an original
issue discount, then the securities registered shall include
such additional Debt Securities as may be necessary such that
the aggregate initial public offering price of all securities
issued pursuant to this Registration Statement will equal
$100,000,000. Any securities registered hereunder may be sold
separately or as units with other securities registered
hereunder. The proposed maximum initial offering price per unit
will be determined, from time to time, by the Registrant in
connection with the issuance by the Registrant of the securities
registered hereunder. There are also being registered hereunder
an indeterminate number of shares of Common Stock as shall be
issuable upon conversion or exercise of any securities that
provide for that issuance.
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(2)
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Each Unit will be issued under a unit agreement or indenture and
will represent an interest in one or more Debt Securities,
shares of Common Stock, shares of Preferred Stock and Warrants,
in any combination.
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(3)
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Calculated pursuant to Rule 457(o) of the rules and
regulations under the Securities Act.
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The Registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective
date until the Registrant shall file a further amendment which
specifically states that this Registration Statement shall
thereafter become effective in accordance with Section 8(a)
of the Securities Act or until the Registration Statement shall
become effective on such date as the Securities and Exchange
Commission, acting pursuant to said Section 8(a), may
determine.
The
information in this preliminary prospectus is not complete and
may be changed. These securities may not be sold until the
registration statement filed with the Securities and Exchange
Commission is effective. This preliminary prospectus is not an
offer to sell nor does it seek an offer to buy these securities
in any jurisdiction where the offer or sale is not permitted.
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SUBJECT TO COMPLETION, DATED
NOVEMBER 9, 2009
Thomas Weisel Partners Group,
Inc.
$100,000,000
DEBT SECURITIES
PREFERRED STOCK
COMMON STOCK
WARRANTS
UNITS
Thomas Weisel Partners Group, Inc. from time to time may offer
to sell debt securities, preferred stock and common stock,
either individually, represented by warrants or in units. We may
also offer common stock issuable upon the conversion of debt
securities or preferred stock. The total amount of these
securities will have an initial aggregate offering price of up
to $100,000,000, or the equivalent amount in other currencies,
currency units or composite currencies.
We may offer and sell these securities to or through one or more
underwriters, dealers and agents, or directly to purchasers, on
a continuous or delayed basis.
This prospectus describes some of the general terms that may
apply to these securities and the general manner in which they
may be offered. The specific terms of any securities to be
offered, and the specific manner in which they may be offered,
will be described in supplements to this prospectus. You should
read this prospectus and the applicable prospectus supplement
carefully before you invest.
Our common stock is listed on The Nasdaq Global Market under the
symbol TWPG. The last reported sale price of the
common stock on The Nasdaq Global Market on November 6,
2009 was $4.87 per share.
Investing in these securities involves risks. See
Risk Factors beginning on page 3.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or passed upon the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal
offense.
The date of this prospectus
is ,
2009.
Explanatory
Note
This document is called a prospectus and is part of a
registration statement that we filed with the Securities and
Exchange Commission, or SEC, using a shelf
registration or continuous offering process. Under this shelf
process, we may from time to time sell any combination of the
securities described in this prospectus in one or more offerings
up to a total dollar amount of $100,000,000.
This prospectus provides you with a general description of the
securities we may offer. Each time we sell securities, we will
provide a prospectus supplement containing specific information
about the terms of the securities being offered. That prospectus
supplement may include a discussion of any risk factors or other
special considerations that apply to those securities. The
prospectus supplement may also add, update or change information
in this prospectus. If there is any inconsistency between the
information in this prospectus and a prospectus supplement, you
should rely on the information in that prospectus supplement.
You should read both this prospectus and any prospectus
supplement together with the additional information described
under the heading Available Information.
The registration statement containing this prospectus, including
exhibits to the registration statement, provides additional
information about us and the securities offered under this
prospectus. The registration statement can be read at the SEC
web site or at the SEC offices mentioned under the heading
Available Information.
When acquiring any securities discussed in this prospectus, you
should rely only on the information provided in this prospectus
and in the prospectus supplement, including the information
incorporated by reference. Neither we nor any underwriters or
agents have authorized any dealer, salesperson or other person
to give any information or to make any representations to you
other than the information contained in this prospectus and the
prospectus supplement. You must not rely on any information or
representations not contained or incorporated by reference in
this prospectus or the prospectus supplement as if we had
authorized it. You should not assume that the information
contained in this prospectus, the prospectus supplement or any
documents incorporated by reference is truthful and complete as
of any date other than the date on the cover page of those
documents. We are not making an offer of these securities in any
state where the offer is not permitted.
Unless otherwise stated or the context otherwise requires,
references in this prospectus to Thomas Weisel
Partners, we, our or
us refer to Thomas Weisel Partners Group, Inc. and
its direct and indirect subsidiaries.
1
THOMAS
WEISEL PARTNERS GROUP, INC.
We are an investment bank focused principally on growth
companies and growth investors. We were founded in 1998 as a
limited liability company, and initially capitalized through
investments from our founding partners and more than 20 venture
capital and private equity firms. On February 7, 2006,
Thomas Weisel Partners Group, Inc., a Delaware corporation,
succeeded to the business of Thomas Weisel Partners Group LLC
and completed an initial public offering of its common stock.
On January 2, 2008, we completed our acquisition of
Westwind Capital Corporation, an independent, institutional
investment bank focused on growth companies and growth
investors, particularly in the energy and mining sectors.
Subsequent to the acquisition of Westwind, we have 12 office
locations in four countries.
Our business is managed as a single operating segment and we
generate revenues by providing financial services that include
investment banking, brokerage, research and asset management. We
take a comprehensive approach in providing these services to
growth companies. We are exposed to volatility and trends in the
general securities market and the economy. Notwithstanding this
exposure to volatility and trends, in order to provide value to
our clients, we have made a long-term commitment to maintaining
a substantial, full-service integrated business platform. As a
result of this commitment, if business conditions result in
decreases to our revenues, we may not experience corresponding
decreases in the expense of operating our business.
Our headquarters are located at One Montgomery Street,
San Francisco, California 94104 and our telephone number is
(415) 364-2500.
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RISK
FACTORS
You should carefully consider the following risks and all of the
other information set forth in this prospectus before deciding
to invest in the securities. If any of the events or
developments described below actually occurred, our business,
financial condition or results of operations would likely
suffer. In that case, the trading price of the securities would
likely decline, and you could lose all or part of your
investment in the securities.
Risks
Related to Our Business
Our
businesses have been and may continue to be adversely affected
by conditions in the global financial markets and economic
conditions generally.
Our businesses, by their nature, do not produce predictable
earnings, and are affected by changes in economic conditions
generally and in particular by conditions in the financial
markets. Over the past year, economic conditions and the state
of the financial markets have changed suddenly, significantly
and negatively which has affected and continues to affect our
business and results of operations.
Since mid-2007, the financial services industry and the
securities markets generally experienced significant valuation
declines in virtually all asset categories. This was initially
triggered by the subprime mortgage crisis, but eventually spread
to other asset classes, including equities. Financial markets
over this period have been characterized by substantially higher
volatility, a lack of liquidity and a general loss of investor
confidence, initially in financial institutions, but more
recently in companies in a number of other industries and in the
broader markets, including the industries in which we specialize.
Tighter credit has forced investors and other market
participants to reduce leverage rapidly, which has exacerbated
market volatility and contributed to further declines in asset
values. Market conditions have also led to the failure or merger
of a number of prominent financial institutions with which we
compete. Financial institution failures or near-failures have
resulted in further losses and have also impacted the trading
prices of shares in all financial institutions, including ours.
In addition, as of the end of 2008, the United States and many
other international markets are in a recession.
Business activity across a wide range of industries, including
the sectors in which we specialize, is greatly reduced. The
weakness in equity markets has resulted in diminished trading
volume of securities that could adversely impact our brokerage
business. Industry-wide declines in the size and number of
underwritings and mergers and acquisitions transactions have had
an adverse effect on our revenues. Reductions in the trading
prices for equity securities tend to reduce the deal value of
investment banking transactions, such as underwritings and
mergers and acquisitions transactions, which in turn may reduce
the fees we earn from these transactions. Also, difficult market
conditions have decreased the value of assets under management
in our asset management and private client business, which
decrease the amount of asset-based fees we receive, and may also
affect our ability to attract additional, or retain existing,
assets under management within these businesses.
In addition, as an investment bank focused principally on the
growth sectors of the economy, we depend significantly on
transactions by venture capital-backed companies for sources of
revenues and potential business opportunities. To the extent
venture capital investment activities slow due to difficult
market conditions or otherwise, our business, financial
condition, results of operations and cash flows may be adversely
affected.
Our financial performance depends to a great extent on the
economic environment in which we operate. Since mid-2007 the
business environment has been extremely adverse for our
businesses and those of many of our clients and there can be no
assurance that these conditions will improve in the near term.
Until they do, we expect our results of operations will continue
to be adversely affected.
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We
focus principally on specific sectors of the economy, and a
deterioration in the business environment in these sectors
generally or decline in the market for securities of companies
within these sectors could materially adversely affect our
businesses.
We focus principally on the technology, healthcare, industrial
growth, consumer, energy and mining sectors of the economy.
Therefore, volatility in the business environment in these
sectors generally, or in the market for securities of companies
within these sectors particularly, could substantially affect
our financial results and the market value of our common stock.
The business environment for companies in these sectors can
experience substantial volatility, and our financial results may
consequently be subject to significant variations from year to
year. The market for securities in each of our focus sectors may
also be subject to industry-specific risks. For example, changes
in policies by the United States Food and Drug Administration
may affect the market for securities of biotechnology and
healthcare companies and volatility in the commodities markets
may affect the market for securities of energy or mining
companies that operate in the affected markets. Underwriting
transactions, strategic advisory engagements and related trading
activities in our focus sectors represent a significant portion
of our businesses. This concentration exposes us to the risk of
substantial declines in revenues in the event of downturns in
these sectors of the economy.
Any future downturns in our focus sectors could materially
adversely affect our business and results of operations.
Regulatory
and legal developments related to auction rate securities could
adversely affect our business, financial condition, operations
and cashflow.
Since February 2008, the auctions through which most auction
rate securities (ARS) are sold and interest rates
are determined have failed, resulting in a lack of liquidity for
these securities.
We, together with many other firms in the financial services
industry, have received inquiries from the Financial Industry
Regulatory Authority (FINRA) requesting information
concerning purchases of auction rate securities by our
customers. Separately, we have been named in FINRA arbitrations
filed by two retail customers who purchased auction rate
securities.
We did not, at any time, underwrite auction rate securities or
manage the associated auctions. We acted as agent for our
customers when buying in auctions managed by underwriters.
Nevertheless, some combination of FINRA
and/or
our
customers could seek to compel us to purchase auction rate
securities from our customers, although we do not have
sufficient regulatory capital nor do we have cash or borrowing
capacity to repurchase all of the auction rate securities held
by those customers. We are and have been exploring potential
solutions for our Private Client Services customers and have
supported the efforts of industry participants, including
particularly the efforts of those underwriters of auction rate
securities who have entered into settlements with the SEC and
other regulators that contain best efforts
commitments to repurchase auction rate securities, to resolve
issues relating to the lack of liquidity for auction rate
securities. We have filed Statements of Claims with FINRA
against the various investment banks who acted as the
underwriters and auction managers of most of the auction rate
securities currently held by our customers. Through this
process, we hope to secure for our customers relief that is the
same as or equivalent to the relief that these entities have
agreed to provide to their own retail customers.
On July 23, 2009, the staff of the Enforcement Department
of FINRA (the Staff) advised our broker-dealer
subsidiary Thomas Weisel Partners LLC (TWP), that
the Staff has made a preliminary determination to recommend
disciplinary action in connection with TWPs transactions
in ARS on behalf of its customers, including transactions for
and with us. The Staffs recommendation involves potential
violations of FINRA and Municipal Securities Rulemaking Board
rules and certain anti-fraud and other provisions of the federal
securities laws in connection with the purchase and sales of ARS
and certain statements and disclosures made in connection with
those purchases and sales. A Staff preliminary determination is
neither a formal allegation nor is it evidence of wrongdoing.
TWP has responded to the Staffs preliminary determination
and continues to communicate with the Staff to provide its
perspective on relevant events and alleged conduct and to seek
to resolve the matter, but there can be no assurance that those
efforts will be successful or that a disciplinary proceeding
will not be brought. TWP is prepared
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to contest vigorously any formal disciplinary action that would
result in a censure, fine, or other sanction that could be
material to our business, financial position or results of
operations. If FINRA were to institute disciplinary action, it
is possible that such action could result in a material adverse
effect on our business, financial position or results of
operations. However, we are unable to determine at this time the
impact on it of the ultimate resolution of this matter.
Our
financial results may fluctuate substantially from period to
period, which may impair our stock price.
We have experienced, and expect to experience in the future,
significant periodic variations in our revenues and results of
operations. These variations may be attributable in part to the
fact that our investment banking revenues are typically earned
upon the successful completion of a transaction, the timing of
which is uncertain and beyond our control. In most cases we
receive little or no payment for investment banking engagements
that do not result in the successful completion of a
transaction. As a result, our business is highly dependent on
market conditions as well as the decisions and actions of our
clients and interested third parties. For example, a
clients acquisition transaction may be delayed or
terminated because of a failure to agree upon final terms with
the counterparty, failure to obtain necessary regulatory
consents or board or shareholder approvals, failure to secure
necessary financing, adverse market conditions or unexpected
financial or other problems in the clients or
counterpartys business. If the parties fail to complete a
transaction on which we are advising or an offering in which we
are participating, we will earn little or no revenue from the
transaction. This risk may be intensified by our focus on growth
companies, as the market for securities of many of these
companies has experienced significant variations in the number
and size of equity offerings. Recently, more companies
initiating the process of an initial public offering are
simultaneously exploring merger and acquisition opportunities.
If we are not engaged as a strategic advisor in any such
dual-tracked process, our investment banking revenues would be
adversely affected in the event that an initial public offering
is not consummated.
In addition, we receive warrants from time to time as
compensation for investment banking services which are adjusted
to fair value through earnings in accordance with
U.S. generally accepted accounting principles at the end of
each quarter, which could increase the volatility of our
quarterly earnings.
As a result, we are unlikely to achieve steady and predictable
earnings on a quarterly basis. These fair value adjustments
could in turn adversely affect our stock price.
Our
ability to retain our professionals and recruit additional
professionals is critical to the success of our business, and
our failure to do so may materially adversely affect our
reputation, business and results of operations.
Our ability to obtain and successfully execute our business
depends upon the personal reputation, judgment, business
generation capabilities and project execution skills of our
senior professionals, particularly Thomas W. Weisel, our
founder, Chairman and Chief Executive Officer, Lionel F.
Conacher, our President and Chief Operating Officer, and the
other members of our Executive Committee. Our senior
professionals personal reputations and relationships with
our clients are a critical element in obtaining and executing
client engagements. We encounter intense competition for
qualified employees from other companies in the investment
banking industry as well as from businesses outside the
investment banking industry, such as investment advisory firms,
hedge funds, private equity funds and venture capital funds.
From time to time, we have experienced losses of investment
banking, brokerage, research and other professionals, and losses
of our key personnel may occur in the future. The departure or
other loss of Mr. Weisel, Mr. Conacher, any other
member of our Executive Committee or any other senior
professional who manages substantial client relationships and
possesses substantial experience and expertise, could impair our
ability to secure or successfully complete engagements, protect
our market share or retain assets under management, each of
which, in turn, could materially adversely affect our business
and results of operations. Certain of our investment funds may
be subject to key man provisions which, upon the departure or
other loss of some or all of the investment professionals
managing the fund, may permit the investors in the fund to
dissolve the fund or may result in a reduction of the management
fees paid with respect to the investment fund.
5
In connection with our initial public offering and our
conversion to corporate form, many of our professionals received
substantial amounts of common stock in exchange for their
membership interests. Ownership of, and the ability to realize
equity value from, our common stock, unlike that of membership
interests in Thomas Weisel Partners Group LLC (the predecessor
to Thomas Weisel Partners Group, Inc.), does not depend upon
continued employment and our professionals are not restricted
from leaving us by the potential loss of the value of their
ownership interests. Similarly, in connection with our
acquisition of Westwind, many of the Westwind professionals
received substantial amounts of common stock (or shares
exchangeable for our common stock) in consideration of their
ownership interests in Westwind. Ownership of, and the ability
to realize equity value from our common stock (or shares
exchangeable for our common stock), unlike that of ownership
interests in Westwind, does not depend on continued employment
and these professionals are not restricted from leaving us by
potential loss of the value of their ownership interests. These
shares of common stock (and shares exchangeable for our common
stock) are subject to certain restrictions on transfer and a
portion are pledged to secure liquidated damages obligations to
us as set forth in the Partners Equity Agreement and the
Westwind Capital Corporation Shareholders Equity
Agreement, each of which has been filed as an exhibit to our
Annual Report on
Form 10-K
for the fiscal year ended December 31, 2008. However, these
agreements will survive for only a limited period and will
permit any professional that is party thereto to leave us
without losing any of their shares of common stock (or shares
exchangeable for our common stock) if they comply with these
agreements, and, in some cases, compliance with these agreements
may also be waived. Consequently, the steps we have taken to
encourage the continued service of these individuals after our
initial public offering may not be effective.
If any of our professionals were to join an existing competitor
or form a competing company, some of our clients could choose to
use the services of that competitor instead of our services. The
compensation arrangements, non-competition agreements and
lock-up
agreements we have entered into with certain of our
professionals may not prove effective in preventing them from
resigning to join our competitors and the non-competition
agreements may not be upheld if we were to seek to enforce our
rights under these agreements.
If we are unable to retain our professionals or recruit
additional professionals, our reputation, business, results of
operations and financial condition may be materially adversely
affected.
Our
efforts to limit compensation and benefits expense may hinder
our ability to retain our professionals and recruit additional
professionals.
Competitive pressures may require that our compensation and
benefits expense increase in order to retain our professionals
and recruit additional professionals. Further, new business
initiatives and efforts to expand existing businesses generally
require that we incur compensation and benefits expense before
realizing associated additional revenues. Additionally, we have
granted equity awards in connection with our IPO and as part of
our compensation and hiring process, the full expense of which
is recognized pro rata over a three- or four-year vesting
period. The future expense associated with these grants could
result in an increase to our compensation and benefits expense
in 2009 and subsequent years.
As of September 30, 2009, there was $34.0 million of
unrecognized compensation expense related to non-vested
restricted stock unit awards, which is expected to be recognized
over a weighted-average period of 2.1 years.
Pricing
and other competitive pressures may impair the revenues and
profitability of our brokerage business.
We derive a significant portion of our revenues from our
brokerage business. Along with other brokerage firms, we have
experienced intense price competition in this business in recent
years. In particular, the ability to execute trades
electronically and through other alternative trading systems has
increased the pressure on trading commissions, volume and
spreads and has required us to make investments in our brokerage
business in order to compete. We expect this trend toward
alternative trading systems to continue. We believe we may
experience competitive pressures in these and other areas as
some of our competitors seek to obtain market share by competing
on the basis of price. In addition, we face pressure from our
larger competitors, which may be better able to offer a broader
range of complementary products and services to brokerage
clients in order to win their trading business. As we are
committed to maintaining our comprehensive research coverage to
support our brokerage business, we may
6
be required to make substantial investments in our research
capabilities. If we are unable to compete effectively with our
competitors in these areas, brokerage revenues may decline and
our business, financial condition and results of operations may
be adversely affected.
We
face strong competition from larger firms.
The brokerage, investment banking and asset management
industries are intensely competitive, and we expect them to
remain so. We compete on the basis of a number of factors,
including client relationships, reputation, the abilities and
past performance of our professionals, market focus and the
relative quality and price of our services and products. We have
experienced intense price competition with respect to our
brokerage business, including large block trades, spreads and
trading commissions, as well as competition due to the increased
use of commission sharing arrangements. Pricing and other
competitive pressures in investment banking, including the
trends toward multiple book runners, co-managers and multiple
financial advisors handling transactions, have continued and
could adversely affect our revenues, even during periods where
the volume and number of investment banking transactions are
increasing. Competitive factors with respect to our asset
management activities include the amount of firm capital we can
invest in new products and our ability to increase assets under
management, including our ability to attract capital for new
investment funds. We believe we may experience competitive
pressures in these and other areas in the future as some of our
competitors seek to obtain market share by competing on the
basis of price.
We are a relatively small investment bank with approximately
460 employees as of September 30, 2009. Many of our
competitors in the brokerage, investment banking and asset
management industries have a broader range of products and
services, greater financial and marketing resources, larger
customer bases, greater name recognition, more senior
professionals to serve their clients needs, greater global
reach and more established relationships with clients than we
have. These larger and better capitalized competitors may be
better able to respond to changes in the brokerage, investment
banking and asset management industries, to compete for skilled
professionals, to finance acquisitions, to fund internal growth
and to compete for market share generally.
Notwithstanding the displacement in the financial services that
occurred in 2008, the scale of our competitors has increased
over time as a result of substantial consolidation among
companies in the brokerage and investment banking industries. In
addition, a number of large commercial banks, insurance
companies and other broad-based financial services firms have
established or acquired underwriting or financial advisory
practices and broker-dealers or have merged with other financial
institutions. These firms have the ability to offer a wider
range of products than we do, which may enhance their
competitive position. They also have the ability to support
investment banking with commercial banking, insurance and other
financial services in an effort to gain market share, which has
resulted, and could further result, in pricing pressure in our
businesses. In particular, the ability to provide financing has
become an important advantage for some of our larger competitors
and, because we do not provide such financing, we may be unable
to compete as effectively for clients in a significant part of
the brokerage and investment banking market. If we are unable to
compete effectively with our competitors, our business,
financial condition and results of operations will be adversely
affected.
We
have incurred losses and may incur losses in the
future.
We recorded net losses of $203.3 million for the year ended
December 31, 2008 and $48.5 million for the nine
months ended September 30, 2009 and we may incur additional
losses in the future. If we are unable to finance any future
losses, those losses may have a significant effect on our
liquidity as well as our ability to operate.
In addition, we may incur significant expenses in connection
with initiating new business activities or in connection with
any expansion of our underwriting, brokerage or asset management
businesses. We may also engage in strategic acquisitions and
investments for which we may incur significant expenses.
Accordingly, we will need to increase our revenues at a rate
greater than our expenses to achieve and maintain profitability.
If our revenues do not increase sufficiently, or even if our
revenues increase but we are unable to manage our expenses, we
will not achieve and maintain profitability in future periods.
7
Our
capital markets and strategic advisory engagements are singular
in nature and do not generally provide for subsequent
engagements.
Our strategy is to take a lifecycle approach in providing
investment banking services to our clients, however, our
investment banking clients generally retain us on a short-term,
engagement-by-engagement
basis in connection with specific capital markets or mergers and
acquisitions transactions, rather than on a recurring basis
under long-term contracts. As these transactions are typically
singular in nature and our engagements with these clients may
not recur, we must seek out new engagements when our current
engagements are successfully completed or are terminated. As a
result, high activity levels in any period are not necessarily
indicative of continued high levels of activity in any
subsequent period. If we are unable to generate a substantial
number of new engagements and generate fees from the successful
completion of these transactions, our business and results of
operations would likely be adversely affected.
A
significant portion of our brokerage revenues are generated from
a relatively small number of institutional
clients.
A significant portion of our brokerage revenues are generated
from a relatively small number of institutional clients. For
example, for the nine months ended September 30, 2009 we
generated 26% of our brokerage revenues, or approximately 3% of
our net revenues, from our ten largest brokerage clients.
Similarly, for the nine months ended September 30, 2008 we
generated 25% of our brokerage revenues, or approximately 16% of
our net revenues, from our ten largest brokerage clients. If any
of our key clients departs or reduces its business with us and
we fail to attract new clients that are capable of generating
significant trading volumes, our business and results of
operations will be adversely affected.
Poor
investment performance, pricing pressure and other competitive
factors may reduce our asset management revenues or result in
losses.
As part of our strategy, we are investing in the expansion of
our asset management business. Our revenues from this business
are primarily derived from management fees which are based on
committed capital
and/or
assets under management and incentive fees, which are earned if
the return of our investment funds exceeds certain threshold
returns. Our ability to maintain or increase assets under
management is subject to a number of factors, including
investors perception of our past performance, market or
economic conditions, competition from other fund managers and
our ability to negotiate terms with major investors.
Investment performance is one of the most important factors in
retaining existing clients and competing for new asset
management and private equity business and our historical
performance may not be indicative of future results. Poor
investment performance and other competitive factors could
reduce our revenues and impair our growth in many ways:
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existing clients may withdraw funds from our asset management
business in favor of better performing products;
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our incentive fees could decline or be eliminated entirely;
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firms with which we have business relationships may terminate
these relationships with us;
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our capital investments in our investment funds or the seed
capital we have committed to new asset management products may
diminish in value or may be lost; and
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our key employees in the business may depart, whether to join a
competitor or otherwise.
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Our investment funds include gains and losses that have not yet
been realized through sales or other transactions. These
unrealized gains and losses are recognized in our results of
operations because these investments are accounted for in
accordance with GAAP using the fair value method based on the
percentage interest in the underlying partnerships. The
underlying investments held by such partnerships are valued
based on quoted market prices, or estimated fair value if there
is no public market. Due to the inherent uncertainty of
valuation, fair values of these non-marketable investments may
differ from the values that would have been used had a ready
8
market existed for these investments, which differences could be
material, and these differences may result in increased
volatility in our asset management revenues.
To the extent our future investment performance is perceived to
be poor in either relative or absolute terms, our asset
management revenues will likely be reduced and our ability to
raise new funds will likely be impaired. Even when market
conditions are generally favorable, our investment performance
may be adversely affected by our investment style and the
particular investments that we make.
In addition, over the past several years, the size and number of
investment funds, including exchange-traded funds, hedge funds
and private equity funds, has continued to increase. This trend
came to an end recently with the contraction of the credit
markets and the general downturn of the economy, which have been
major contributors to a reduction in the available investor
capital pool. This, coupled with the over-allocation of many
institutional investors to the alternative asset fund class,
could make it increasingly difficult for us to raise capital for
new investment funds. Also, difficult market conditions have
decreased the value of assets under management in our asset
management and private client business, which decreases the
amount of asset-based fees we receive, and may also affect our
ability to attract additional, or retain existing, assets under
management within these businesses.
Increases
in capital commitments in our trading, underwriting and other
businesses increase the potential for significant
losses.
The trend in capital markets is toward larger and more frequent
commitments of capital by financial services firms in many of
their activities. For example, in order to attract clients,
investment banks are increasingly committing capital to purchase
large blocks of stock from publicly-traded issuers or their
significant shareholders, instead of the more traditional
marketed underwriting process, in which marketing is typically
completed before an investment bank commits capital to purchase
securities for resale. We have participated in this trend and
expect to continue to do so. As a result, we will be subject to
increased risk as we commit greater amounts of capital to
facilitate primarily client-driven business. Furthermore, we may
suffer losses even when economic and market conditions are
generally favorable for others in the industry.
We may enter into large transactions in which we commit our own
capital as part of our trading business. The number and size of
these large transactions may materially affect our results of
operations in a given period. We may also incur significant
losses from our trading activities due to market fluctuations
and volatility from quarter to quarter. We maintain trading
positions in the fixed income and equity markets to facilitate
client trading activities, and, at times, these positions can be
large and concentrated in a single issuer. To the extent that we
own assets, i.e., have long positions, a downturn in the value
of those assets or in those markets could result in losses.
Conversely, to the extent that we have sold assets we do not
own, i.e., have short positions, an upturn in those markets
could expose us to potentially unlimited losses as we attempt to
cover our short positions by acquiring assets in a rising market.
We also commit capital to investment funds we sponsor and
utilize our own funds as seed capital for new products and
services in our asset management business. These investments may
diminish in value or may be lost entirely if market conditions
are not favorable.
Limitations
on our access to capital could impair our liquidity and our
ability to conduct our businesses.
Liquidity, or ready access to funds, is essential to financial
services firms. Failures of financial institutions have often
been attributable in large part to insufficient liquidity.
Liquidity is of particular importance to our trading business
and perceived liquidity issues may affect our clients and
counterparties willingness to engage in brokerage
transactions with us. Our liquidity could be impaired due to
circumstances that we may be unable to control, such as a
general market disruption or an operational problem that affects
our trading clients, third parties or us. Further, our ability
to sell assets may be impaired if other market participants are
seeking to sell similar assets at the same time.
Our asset management business is also subject to liquidity risk
due to investments in high-risk, illiquid assets. We have made
substantial principal investments in our investment funds and
may make additional investments in future funds, which often
invest in securities that are not publicly traded. There is a
significant risk that we may be unable to realize our investment
objectives by sale or other disposition at attractive prices or
may otherwise be
9
unable to complete any exit strategy. In particular, these risks
could arise from changes in the financial condition or prospects
of the portfolio companies in which investments are made,
changes in national or international economic conditions or
changes in laws, regulations, fiscal policies or political
conditions of countries in which investments are made. It takes
a substantial period of time to identify attractive investment
opportunities and then to realize the cash value of our
investments through resale. Even if an investment proves to be
profitable, it may be several years or longer before any profits
can be realized in cash.
We have several broker-dealer subsidiaries in several different
jurisdictions which are each subject to the capital requirements
of the relevant governmental and self-regulatory authorities in
those jurisdictions. For example, Thomas Weisel Partners LLC,
our largest broker-dealer subsidiary, is subject to the net
capital requirements of the Securities and Exchange Commission
(SEC) and various self-regulatory organizations of
which it is a member. These requirements typically specify the
minimum level of net capital a broker-dealer must maintain and
also mandate that a significant part of its assets be kept in
relatively liquid form. Any failure to comply with these net
capital requirements could impair our ability to conduct our
core business as a brokerage firm. Furthermore, Thomas Weisel
Partners LLC and our other broker-dealer subsidiaries are
subject to laws and regulations that authorize regulatory bodies
to block or reduce the flow of funds from them to Thomas Weisel
Partners Group, Inc. As a holding company, Thomas Weisel
Partners Group, Inc. depends on distributions and other payments
from its subsidiaries to fund all payments on its obligations,
including debt obligations. As a result, regulatory actions
could impede access to funds that Thomas Weisel Partners Group,
Inc. needs to make payments on obligations, including debt
obligations.
Our
risk management policies and procedures may leave us exposed to
unidentified or unanticipated risk.
Our risk management strategies and techniques may not be fully
effective in mitigating our risk exposure in all market
environments or against all types of risk.
Among other risks, we are exposed to the risk that third parties
that owe us money, securities or other assets will not perform
their obligations. These parties may default on their
obligations to us due to bankruptcy, lack of liquidity,
operational failure, breach of contract or other reasons. We are
also subject to the risk that our rights against third parties
may not be enforceable in all circumstances. As a clearing
member firm, we finance our customer positions and could be held
responsible for the defaults or misconduct of our customers.
Although we regularly review credit exposures to specific
clients and counterparties and to specific industries and
regions that we believe may present credit concerns, default
risk may arise from events or circumstances that are difficult
to detect or foresee. In addition, concerns about, or a default
by, one institution could lead to significant liquidity
problems, losses or defaults by other institutions, which in
turn could adversely affect us. Also, risk management policies
and procedures that we utilize with respect to investing our own
funds or committing our capital with respect to investment
banking, trading activities or asset management activities may
not protect us or mitigate our risks from those activities. If
any of the variety of instruments, processes and strategies we
utilize to manage our exposure to various types of risk are not
effective, we may incur losses.
Our
operations and infrastructure may malfunction or
fail.
Our businesses are highly dependent on our ability to process,
on a daily basis, a large number of increasingly complex
transactions across diverse markets. Our financial, accounting
or other data processing systems may fail to operate properly or
become disabled as a result of events that are wholly or
partially beyond our control, including a disruption of
electrical or communications services or our inability to occupy
one or more of our offices. The inability of our systems to
accommodate an increasing volume of transactions could also
constrain our ability to expand our businesses. If any of these
systems do not operate properly or are disabled, if we
experience difficulties in conforming these systems to changes
in law or regulation or changes in our business activities or if
there are other shortcomings or failures in our internal
processes, people or systems, we could suffer an impairment to
our liquidity, financial loss, disruption of our businesses,
liability to clients, regulatory intervention or reputational
damage.
We also face the risk of operational failure of any of our
clearing agents, the exchanges, clearing houses or other
financial intermediaries we use to facilitate our securities
transactions. Any such failure could adversely affect our
ability to effect transactions and to manage our exposure to
risk.
10
In addition, our ability to conduct business may be adversely
impacted by a disruption in the infrastructure that supports our
businesses and the communities in which we are located. This may
include a disruption due to transitioning from one third-party
service provider to another or due to a disruption involving
electrical, communications, transportation or other services
used by us or third parties with which we conduct business,
whether due to fire, other natural disaster, power or
communications failure, act of terrorism or war or otherwise.
Nearly all of our employees in our primary locations, including
San Francisco, New York, Toronto, London and Boston, work
in close proximity to each other. If a disruption occurs in one
location and our employees in that location are unable to
communicate with or travel to other locations, our ability to
service and interact with our clients may suffer and we may not
be able to implement successfully contingency plans that depend
on communication or travel. Insurance policies to mitigate these
risks may not be available or may be more expensive than the
perceived benefit. Further, any insurance that we may purchase
to mitigate certain of these risks may not cover our loss.
Our operations also rely on the secure processing, storage and
transmission of confidential and other information in our
computer systems and networks. Our computer systems, software
and networks may be vulnerable to unauthorized access, computer
viruses or other malicious code and other events that could have
a security impact. If one or more of such events occur, this
potentially could jeopardize our or our clients or
counterparties confidential and other information
processed and stored in, and transmitted through, our computer
systems and networks, or otherwise cause interruptions or
malfunctions in our, our clients, our counterparties
or third parties operations. We may be required to expend
significant additional resources to modify our protective
measures or to investigate and remediate vulnerabilities or
other exposures, and we may be subject to litigation and
financial losses that are either not insured against or not
fully covered through any insurance maintained by us.
Strategic
investments or acquisitions and joint ventures may result in
additional risks and uncertainties in our
business.
We intend to grow our business through both internal expansion
and through strategic investments, acquisitions or joint
ventures. To the extent we make strategic investments or
acquisitions or enter into joint ventures, we face numerous
risks and uncertainties combining or integrating businesses,
including integrating relationships with customers, business
partners and internal data processing systems. In the case of
joint ventures, we are subject to additional risks and
uncertainties in that we may be dependent upon, and subject to
liability, losses or reputational damage relating to, systems,
controls and personnel that are not under our control. In
addition, conflicts or disagreements between us and our joint
venture partners may negatively impact our businesses.
Any future acquisitions or joint ventures could entail a number
of risks, including problems with the effective integration of
operations, the inability to maintain key pre-acquisition
business relationships, the inability to retain key employees,
increased operating costs, exposure to unanticipated
liabilities, risks of misconduct by employees not subject to our
control, difficulties in realizing projected efficiencies,
synergies and cost savings, and exposure to new or unknown
liabilities.
Any future growth of our business may require significant
resources
and/or
result in significant unanticipated losses, costs or
liabilities. In addition, expansions, acquisitions or joint
ventures may require significant managerial attention, which may
be diverted from our other operations.
Our
international activities are subject to political, economic,
legal, operational and other risks that are inherent in
operating in a foreign country.
In connection with our business activities in Canada, England
and Switzerland, and to the extent that we pursue other business
opportunities outside the United States, we will be subject to
political, economic, legal, operational and other risks that are
inherent in operating in a foreign country, including risks of
possible nationalization, expropriation, price controls, capital
controls, exchange controls and other restrictive governmental
actions, as well as the outbreak of hostilities. In many
countries, the laws and regulations applicable to the securities
and financial services industries are uncertain and evolving,
and it may be difficult for us to determine the exact
requirements of local laws in every market. Our inability to
remain in compliance with local laws in a particular foreign
market could have a significant and negative effect not only on
our businesses in that market but also on our reputation
11
generally. We are also subject to the enhanced risk that
transactions we structure might not be legally enforceable in
the relevant jurisdictions.
As we
expand our international operations, we will increase our
exposure to foreign currency risk.
As a result of the expanded international operations, we hold
assets, incur liabilities, earn revenues and pay expenses in
foreign currencies, including the Canadian dollar, the Swiss
franc and the pound sterling. Because our financial statements
will continue to be presented in U.S. dollars, we will be
required to translate assets, liabilities, income and expenses
that relate to our international operations and that are
denominated in foreign currencies into U.S. dollars at the
then-applicable exchange rates. Consequently, increases and
decreases in the value of the U.S. dollar versus the
various foreign currencies will affect the value of these items
in our financial statements, even if their value has not changed
in such foreign currencies. As a result, our financial results
could be more volatile as a result of our international
operations.
Evaluation
of our prospects may be more difficult in light of our limited
operating history.
Our Company was formed in 1998 and we have a limited operating
history upon which to evaluate our business and prospects. In
addition we acquired Westwind in 2008, which was formed in 2002
and which also has a limited operating history. As a relatively
young enterprise, we are subject to the risks and uncertainties
that face a company during its formative development. Some of
these risks and uncertainties relate to our ability to attract
and retain clients on a cost-effective basis, expand and enhance
our service offerings, raise additional capital and respond to
competitive market conditions. We may not be able to address
these risks adequately, and our failure to do so may adversely
affect our business and the value of an investment in our common
stock.
Despite
the completion of our integration of Westwind, the combined
company may not realize synergies, efficiencies or cost
savings.
Prior to the completion of our acquisition of Westwind in 2008,
we and Westwind operated independently. Despite the completion
of our integration of Westwind, there can be no assurance that
the combined company will realize any synergies, efficiencies or
cost savings or that any of these benefits will be achieved
within a specific time frame.
We
could be subject to unknown liabilities of Westwind, which could
cause us to incur substantial financial obligations and harm our
business.
Although the former Westwind shareholders are required to
indemnify us for certain breaches of representations and
warranties made in the arrangement agreement governing our
acquisition of Westwind, the shareholders obligation is
subject to monetary and time limitations. In addition, if we are
entitled to indemnification by the former Westwind shareholders,
it may be costly to enforce those rights
and/or
we
may not be successful in collecting amounts we are entitled to.
If there are liabilities of Westwind of which we are not aware,
we may have little or no recourse against the former Westwind
shareholders and may be obligated to bear the costs of those
liabilities. In addition, many of the former Westwind
shareholders have continued as employees of the combined company
following closing of the transaction. Accordingly, if an
indemnifiable claim does arise, we may need to weigh the need to
be indemnified for that claim against the potential employee
distraction or damage to employee relations that may result if
we were to seek recourse for that claim.
Following
our acquisition of Westwind, we are subject to additional risks
relating to Westwinds business.
As a result of the acquisition of Westwind, we are subject to
the risks relating to Westwinds business. Because the
risks and uncertainties facing us may differ from those that
faced Westwind, the market price, results of operations and
financial condition of the combined company may be affected by
risks and uncertainties different from those affecting us prior
to the acquisition. These risks include the following:
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Westwinds focus on specific sectors of the economy
Westwinds investment banking business
focused principally on the mining and energy sectors of the
economy. As a result of the acquisition of Westwind, the
combined companys business has more exposure to these
sectors than Thomas Weisel Partners business
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had prior to the transaction. Volatility in the business
environment in these sectors generally, including the related
commodities markets, or in the market for securities of
companies within these sectors, could substantially affect our
business and results of operations.
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Westwinds focus on Canada
Westwind
generated a substantial majority of its revenues from
Canadian-based clients. As a result, Westwinds business
and results of operations was highly dependent on the strength
of the Canadian economy. As a result of the acquisition of
Westwind, we expect that a significant portion of the combined
companys business will be derived from Canadian-based
clients. Accordingly, our business will be affected by changes
in the Canadian economy and investment activity in Canada. To
the extent that we experience a decline in business in Canada,
due to unfavorable conditions in the Canadian economy or
otherwise, we may not be able to offset these declines by
increases in other aspects of our business and our financial
results could suffer.
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An
impairment in the carrying value of other intangible assets
could negatively affect our consolidated statements of financial
position, results of operations and cash flows.
A substantial portion of our assets arise from other intangible
assets recorded as a result of our acquisition of Westwind. We
perform a test for impairment of such other intangible assets
when events or changes in circumstances indicate these
intangible assets may not be recoverable. If the test resulted
in a write down of other intangible assets, we could incur a
significant loss.
Risks
Related to Our Industry
Risks
associated with regulatory impact on capital
markets.
Highly-publicized financial scandals in recent years have led to
investor concerns over the integrity of the U.S. financial
markets, and have prompted Congress, the SEC and FINRA to
significantly expand corporate governance and public disclosure
requirements. To the extent that private companies, in order to
avoid becoming subject to these new requirements, decide to
forgo initial public offerings, our equity underwriting business
may be adversely affected. In addition, provisions of the
Sarbanes-Oxley Act of 2002 and the corporate governance rules
imposed by self-regulatory organizations have diverted many
companies attention away from capital market transactions,
including securities offerings and acquisition and disposition
transactions. In particular, companies that are or are planning
to be public are incurring significant expenses in complying
with the SEC and accounting standards relating to internal
control over financial reporting, and companies that disclose
material weaknesses in such controls under the new standards may
have greater difficulty accessing the capital markets. These
factors, in addition to adopted or proposed accounting and
disclosure changes or changes in laws and regulations governing
brokerage and research activities, may have an adverse effect on
our business.
Financial
services firms have been subject to increased scrutiny over the
last several years, increasing the risk of financial liability
and reputational harm resulting from adverse regulatory
actions.
Firms in the financial services industry have been operating in
a difficult regulatory environment. The U.S. financial
services industry has experienced increased scrutiny from a
variety of regulators, including the SEC, FINRA and state
attorneys general. Penalties and fines sought by regulatory
authorities have increased substantially over the last several
years. This regulatory and enforcement environment has created
uncertainty with respect to a number of transactions that had
historically been entered into by financial services firms and
that were generally believed to be permissible and appropriate.
We may be adversely affected by changes in the interpretation or
enforcement of existing laws and rules by these governmental
authorities and self-regulatory organizations. We also may be
adversely affected as a result of new or revised legislation or
regulations imposed by the SEC, other United States or foreign
governmental regulatory authorities or self-regulatory
organizations that supervise the financial markets. Among other
things, we could be fined, prohibited from engaging in some of
our business activities or subject to limitations or conditions
on our business activities. Substantial legal liability or
significant regulatory action against us could have material
adverse financial effects or cause significant reputational harm
to us, which could seriously harm our business prospects.
13
In addition, financial services firms are subject to numerous
conflicts of interest or perceived conflicts. The SEC and other
federal and state regulators have increased their scrutiny of
potential conflicts of interest. We have adopted various
policies, controls and procedures to address or limit actual or
perceived conflicts and regularly seek to review and update our
policies, controls and procedures. However, appropriately
dealing with conflicts of interest is complex and difficult, and
our reputation could be damaged if we fail, or appear to fail,
to deal appropriately with conflicts of interest. Our policies
and procedures to address or limit actual or perceived conflicts
may also result in increased costs, additional operational
personnel and increased regulatory risk. Failure to adhere to
these policies and procedures may result in regulatory sanctions
or client litigation.
Our
exposure to legal liability is significant, and damages that we
may be required to pay and the reputational harm that could
result from legal action against us could materially adversely
affect our businesses.
We face significant legal risks in our businesses, and, in
recent years, the volume of claims and amount of damages sought
in litigation and regulatory proceedings against financial
institutions have been increasing. These risks include potential
liability under securities or other laws for materially false or
misleading statements made in connection with securities
offerings and other transactions, potential liability for
fairness opinions and other advice we provide to
participants in strategic transactions and disputes over the
terms and conditions of complex trading arrangements. We are
also subject to claims arising from disputes with employees for
alleged discrimination or harassment, among other things. These
risks often may be difficult to assess or quantify, and their
existence and magnitude often remain unknown for substantial
periods of time.
Our role as advisor to our clients on important underwriting or
mergers and acquisitions transactions involves complex analysis
and the exercise of professional judgment, including rendering
fairness opinions in connection with mergers and
other transactions. Therefore, our activities may subject us to
the risk of significant legal liabilities to our clients and
aggrieved third parties, including shareholders of our clients
who could bring securities class actions against us. Our
investment banking engagements typically include broad
indemnities from our clients and provisions to limit our
exposure to legal claims relating to our services, but these
provisions may not protect us or may not be enforceable in all
cases. For example, an indemnity from a client that subsequently
is placed into bankruptcy is likely to be of little value to us
in limiting our exposure to claims relating to that client. As a
result, we may incur significant legal and other expenses in
defending against litigation and may be required to pay
substantial damages for settlements and adverse judgments.
Substantial legal liability or significant regulatory action
against us could have a material adverse effect on our results
of operations or cause significant reputational harm to us,
which could seriously harm our business and prospects.
While our review of the need for any loss contingency reserve
has led us to conclude that, based upon currently available
information, we have established an adequate provision for loss
related to these matters, we are not able to predict with
certainty the outcome of such matters, and there can be no
assurance that those matters will not have a material adverse
effect on our results of operations in any future period, and a
significant judgment or settlement could have a material adverse
impact on our results of operations, consolidated statements of
financial condition and cash flows.
Employee
misconduct could harm us and is difficult to detect and
deter.
There have been a number of highly publicized cases involving
fraud or other misconduct by employees in the financial services
industry in recent years, and we run the risk that employee
misconduct could occur at our company. For example, misconduct
by employees could involve the improper use or disclosure of
confidential information, which could result in regulatory
sanctions and serious reputational or financial harm. It is not
always possible to deter employee misconduct and the precautions
we take to detect and prevent this activity may not be effective
in all cases, and we may suffer significant reputational harm
for any misconduct by our employees.
Risks
Related to Ownership of Our Common Stock
Taken
together, a significant percentage of our outstanding common
stock and shares exchangeable for common stock is owned or
controlled by our senior professionals and other employees and
their interests may differ from those of other
shareholders.
Our Chief Executive Officer, Thomas W. Weisel, beneficially owns
approximately 8% of our common stock and our President and Chief
Operating Officer, Lionel F. Conacher, beneficially owns
approximately 4% of our
14
common stock (including exchangeable shares). Mr. Weisel
and Mr. Conacher, together with the other members of our
Executive Committee, collectively own approximately 16% of our
common stock (including exchangeable shares) and together with
our current employees own a significant percentage of our common
stock outstanding. As a result of these shareholdings, our
current employees have significant influence over the outcome of
elections of our board of directors, control over our management
and policies, in general, and the outcome of any corporate
transaction or other matter submitted to the shareholders for
approval, including mergers, consolidations and the sale of all
or substantially all of our assets, and their interests may
differ from those of other shareholders.
Provisions
of our organizational documents may discourage an acquisition of
us.
Our organizational documents contain provisions that will impede
the removal of directors and may discourage a third party from
making a proposal to acquire us. For example, our board of
directors may, without the consent of shareholders, issue
preferred stock with greater voting rights than our common
stock. If a change of control or change in management that
shareholders might otherwise consider to be favorable is
prevented or delayed, the market price of our common stock could
decline.
Future
sales of our common stock could cause our stock price to decline
and the trading volume of our common stock may be
volatile.
Sales of substantial amounts of common stock by our senior
professionals, employees and other shareholders, or the
possibility of such sales, may adversely affect the price of our
common stock, may impede our ability to raise capital through
the issuance of equity securities, and may cause trading volume
in our common stock to be volatile.
As of September 30, 2009, there were approximately
25.4 million shares of our common stock outstanding, and
approximately 6.3 million exchangeable shares of TWP
Acquisition Company (Canada) Inc., one of our wholly-owned
subsidiaries. Each exchangeable share is exchangeable at any
time into common stock of the registrant on a one-for-one basis,
entitles the holder to dividend and other rights economically
equivalent to those of the common stock, and through a voting
trust, votes at our stockholder meetings.
Of these shares, up to approximately one half are freely
transferable without restriction or further registration under
the Securities Act of 1933 or pursuant to an exemption from
registration under Rule 144. Subject to certain exceptions,
the remaining approximately one half of these shares of common
stock and shares exchangeable for common stock will be available
for future sale upon the expiration or the waiver of transfer
restrictions or in accordance with registration rights. In
addition, since we became a public company we have granted (and
will continue to grant in the future) equity awards to our
employees that began to vest and become deliverable. Upon
vesting and delivery of the shares of common stock underlying
these awards many employees may decide to sell all or a portion
of their shares in the public markets and these sales may happen
at or around the same time due to similar vesting dates or due
to the limited periods of time (trading windows) when we allow
our employees to trade our common stock. These factors may
affect both the price of our common stock and the volume of
shares traded. For further information refer to the
Securities Authorized for Issuance under Equity
Compensation Plans within Item 5
Market for Registrants Common Equity, Related
Stockholder Matters and Issuer Purchases of Equity
Securities of our Annual Report on
Form 10-K
for the fiscal year ended December 31, 2008.
The
market price of our common stock may decline.
The price of our common stock may fluctuate widely, depending
upon many factors, including our perceived prospects and those
of the financial services industry in general, differences
between our actual financial and operating results and those
expected by investors, changes in general economic or market
conditions, broad market fluctuations and failure to be covered
by securities analysts. Declines in the price of our stock may
adversely affect our ability to recruit and retain key
employees, including our senior professionals.
Broad market and industry factors may adversely affect the
market price of our common stock, regardless of our actual
operating performance. Factors that could cause fluctuations in
our stock price may include, among others, actual or anticipated
variations in quarterly operating results, changes in financial
estimates by us or by any securities analysts who might cover
our stock, or our failure to meet the estimates made by
securities analysts, announcements by us or our competitors or
significant acquisitions, strategic partnerships or
divestitures, announcements by our
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competitors of their financial or operating results, to the
extent those announcements are perceived by investors to be
indicative of our future financial results or market conditions,
additions or departures of key personnel, sales of our common
stock, including sales of our common stock by our directors,
officers and employees or by our other principal stockholders,
and cyclical changes in the market in the growth sectors of the
economy.
Your
interest in our firm may be diluted due to issuance of
additional shares of common stock.
Owners of our common stock may experience dilution of their
equity investment as a result of our issuance of additional
shares of common stock or securities that are convertible into,
or exercisable for, shares of our common stock. We may issue
additional shares of common stock in connection with any merger
or acquisition we undertake, in future public or private
offerings to raise additional capital or in satisfaction of
currently outstanding restricted stock units, warrants and
options. For example, on January 2, 2008, we issued a total
of 7,009,112 shares of our common stock (and exchangeable
shares) to former shareholders of Westwind in connection with
our acquisition of Westwind. We also have granted and will
continue to grant equity awards under our Equity Incentive Plan
as part of our compensation and hiring processes, and when these
awards are vested or become deliverable we will issue additional
shares of common stock in satisfaction thereof. As of
September 30, 2009, there were 8,836,041 restricted stock
units outstanding.
For further information refer to the Securities Authorized
for Issuance under Equity Compensation Plans within
Item 5 Market for Registrants
Common Equity, Related Stockholder Matters and Issuer Purchases
of Equity Securities of our Annual Report on
Form 10-K
for the fiscal year ended December 31, 2008.
We may
be required to make substantial payments under indemnification
agreements.
In connection with our initial public offering and our
conversion to corporate form, we entered into agreements that
provide for the indemnification of our members, partners,
directors, officers and certain other persons authorized to act
on our behalf against certain losses that may arise out of our
initial public offering or the related reorganization
transactions, certain liabilities of our partners relating to
the time they were members of Thomas Weisel Partners Group LLC,
and certain tax liabilities of our former members that may arise
in respect of periods prior to our initial public offering when
we operated as a limited liability company.
In addition, in connection with acquisition transactions, such
as our acquisition of Westwind, and in connection with the
ordinary conduct of our business, such as in our relationship
with our clearing brokers, we have provided and will continue to
provide indemnities to counterparties.
We may be required to make payments under these indemnification
agreements, which could adversely affect our financial condition.
We do
not expect to pay any cash dividends in the foreseeable
future.
We intend to retain any future earnings to fund the operation
and expansion of our business, and, therefore, we do not
anticipate paying cash dividends in the foreseeable future.
Accordingly, our shareholders must rely on sales of their shares
of common stock after price appreciation, which may never occur,
as the only way to realize any future gains on an investment in
our common stock. Investors seeking cash dividends should not
purchase our common stock.
Risks
Related to Debt Securities
If we
issue unsecured debt securities, your right to receive payments
on the debt securities will be unsecured and will be effectively
subordinated to our existing and future secured indebtedness and
to indebtedness of any of our subsidiaries who do not guarantee
the debt securities.
Any unsecured debt securities issued by us will be effectively
subordinated to the claims of our secured creditors. In the
event of the insolvency, bankruptcy, liquidation,
reorganization, dissolution or winding up of our business our
secured creditors would generally have the right to be paid in
full before any distribution is made to the holders of the
unsecured debt securities. Furthermore, if any of our
subsidiaries do not guarantee the unsecured securities, these
debt securities will be effectively subordinated to the claims
of all creditors, including trade creditors and tort claimants,
of those subsidiaries. In the event of the insolvency,
bankruptcy, liquidation,
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reorganization, dissolution or winding up of the business of a
subsidiary that is not a guarantor, creditors of that subsidiary
would generally have the right to be paid in full before any
distribution is made to the issuers of the unsecured debit
securities or the holders of the unsecured debt securities.
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
We have made statements in this prospectus and the prospectus
supplement and in the documents that are incorporated by
reference that are forward-looking statements. In some cases,
you can identify these statements by forward-looking words such
as may, might, will,
should, expect, plan,
anticipate, believe,
estimate, predict, potential
or continue, the negative of these terms and other
comparable terminology. These forward-looking statements, which
are subject to risks, uncertainties and assumptions about us,
may include projections of our future financial performance,
based on our growth strategies and anticipated trends in our
business. These statements are only predictions based on our
current expectations and projections about future events. There
are important factors that could cause our actual results, level
of activity, performance or achievements to differ materially
from the results, level of activity, performance or achievements
expressed or implied by the forward-looking statements. In
particular, you should consider the numerous risks outlined
under Risk Factors in our Annual Report on
Form 10-K
for the year ended December 31, 2008, and our Quarterly
Reports on
Form 10-Q
for the quarters ended March 31, 2009, June 30, 2009,
and September 30, 2009 each of which is incorporated by
reference in this prospectus.
These risks are not exhaustive. Other sections of this
prospectus may include additional factors which could adversely
impact our business and financial performance. Moreover, we
operate in a very competitive and rapidly changing environment.
New risk factors emerge from time to time and it is not possible
for our management to predict all risk factors, nor can we
assess the impact of all factors on our business or the extent
to which any factor, or combination of factors, may cause actual
results to differ materially from those contained in any
forward-looking statements.
Although we believe the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee
future results, level of activity, performance or achievements.
Moreover, neither we nor any other person assumes responsibility
for the accuracy or completeness of any of these forward-looking
statements. You should not rely upon forward-looking statements
as predictions of future events. We are under no duty to update
any of these forward-looking statements after the date of this
prospectus or the prospectus supplement to conform our prior
statements to actual results or revised expectations.
RATIO OF
EARNINGS TO FIXED CHARGES AND EARNINGS TO COMBINED FIXED CHARGES
AND PREFERENCE DIVIDENDS
The following table sets forth Thomas Weisel Partners
consolidated ratio of earnings to fixed charges for each of the
periods indicated. As of the date of this prospectus, we have
one share of special voting preferred stock outstanding. No
dividends accrue on the special voting preferred stock, and for
all periods presented, there were no preference dividends.
Accordingly, for all periods presented, the ratio of earnings to
combined fixed charges and preference dividends is equal to the
ratio of earnings to fixed charges.
For purposes of the ratios set forth below, earnings
represent income from continuing operations before income taxes
plus fixed charges. Income does not include equity earnings in
unconsolidated subsidiaries less than 50% owned. Fixed charges
include, as applicable, interest expense, amortization of debt
issuance costs and one-third of rental expense, which is
estimated to be representative of the interest factor.
Preference dividends represent pre-tax earnings
required to cover dividends on preferred stock.
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Nine Months Ended
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Year Ended December 31,
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September 30,
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2004
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2005
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2006
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2007
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2008
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2009
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Ratio of Earnings to Fixed Charges (unaudited)
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5.3
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(a
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4.8
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(a
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(a
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(a
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(a)
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Earnings for the nine months ended September 30, 2009 and the
years ended December 31, 2008, 2007 and 2005 were inadequate to
cover fixed charges by $4,102, $6,676, $7,115, and $4,871,
respectively.
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USE OF
PROCEEDS
Except as we may specifically state in any prospectus
supplement, we intend to use the net proceeds from the sale of
the securities for general corporate purposes.
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DESCRIPTION
OF DEBT SECURITIES WE MAY OFFER
This section outlines some of the provisions of the
indentures and the debt securities. This information may not be
complete in all respects and is qualified entirely by reference
to the indentures under which the debt securities are issued.
These indentures are incorporated by reference as exhibits to
the registration statement of which this prospectus is a part.
This information relates to terms and conditions that generally
apply to the debt securities. The specific terms of any series
of debt securities will be described in the prospectus
supplement. If so described in a prospectus supplement, the
terms of that series may differ from the general description of
the terms presented below.
Debt
Securities May Be Senior or Subordinated
We may issue senior or subordinated debt securities. Neither the
senior debt securities nor the subordinated debt securities will
be secured by any of our property or assets. Thus, by owning a
debt security, you are one of our unsecured creditors.
The senior debt securities will constitute part of our senior
debt, will be issued under our senior debt indenture described
below and will rank equally with all of our other unsecured and
unsubordinated debt.
The subordinated debt securities will constitute part of our
subordinated debt, will be issued under our subordinated debt
indenture described below and will be subordinated in right of
payment to all of our senior debt, as defined in the
subordinated debt indenture. The prospectus supplement for any
series of subordinated debt securities will indicate the
approximate amount of senior debt outstanding as of the end of
our most recent fiscal quarter. Neither indenture limits our
ability to incur additional senior indebtedness.
When we refer to debt securities in this prospectus,
we mean both the senior debt securities and the subordinated
debt securities.
The
Senior Debt Indenture and the Subordinated Debt
Indenture
The senior debt securities and the subordinated debt securities
are each governed by a document called an indenture
the senior debt indenture, in the case of the senior debt
securities, and the subordinated debt indenture, in the case of
the subordinated debt securities. Each indenture is a contract
between us and The Bank of New York Mellon Trust Company, N.A.,
which will initially act as trustee. The indentures are
substantially identical, except for the provisions relating to
subordination, which are included only in the subordinated
indenture.
The trustee under each indenture has two main roles:
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First, the trustee can enforce your rights against us if we
default. There are some limitations on the extent to which the
trustee acts on your behalf, which we describe later under
Events of Default; and
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Second, the trustee performs administrative duties for us, such
as sending you interest payments and notices.
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When we refer to the indenture or the trustee with respect to
any debt securities, we mean the indenture under which those
debt securities are issued and the trustee under that indenture.
The indentures permit us to issue different series of securities
from time to time. We may issue securities in such amounts, at
such times and on such terms as we wish. The debt securities may
differ from one another in their terms. Neither indenture limits
the aggregate amounts of debt securities that we may issue or
the aggregate amount of any particular series.
The indentures and the debt securities are governed by New York
law.
This
Section Is Only a Summary
Because this section is a summary, it does not describe every
aspect of the debt securities. The indentures, any supplemental
indentures and the debt securities contain the full legal text
of the matters described in this section. This summary is
subject to and qualified in its entirety by reference to all the
provisions of the indentures, including definitions of some of
the terms used in the indentures. The indentures are exhibits to
our registration statement. See Available
Information for information on how to obtain a copy. This
summary is also subject to and qualified by
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reference to the description of the particular terms of your
series of debt securities described in any prospectus supplement.
Specific
Terms of a Series of Debt Securities
In this section we summarize only the more important terms of
the indentures that will apply generally to the debt securities.
Each particular debt security will have financial, legal and
other terms specific to it, and the specific terms of each debt
security will be described in the applicable prospectus
supplement. Those terms may vary from the terms described here.
As you read this section, therefore, please remember that the
specific terms of your debt security as described in your
prospectus supplement will supplement and, if applicable, may
modify or replace the general terms described in this section.
The statements we make in this section may not apply to your
debt security.
We may issue the debt securities as original issue discount
securities, which are debt securities that are offered and sold
at a substantial discount to their stated principal amount. The
debt securities may also be issued as indexed securities or
securities denominated in foreign currencies or currency units,
as well as composite currencies or composite currency units, as
described in more detail in the prospectus supplement relating
to any of these types of debt securities.
The prospectus supplement relating to a series of debt
securities will specify whether the securities are senior or
subordinated debt securities and will describe the following
terms of the series:
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the title of the series;
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any limit on the aggregate principal amount of the series;
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the manner in which we will pay interest on the debt securities;
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the date or dates on which we will pay the principal of the debt
securities;
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the rate per annum, which may be fixed or variable, at which the
debt securities will bear interest, if any, and the date from
which that interest will accrue;
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the dates on which interest, if any, will be payable and the
regular record dates for the interest payment dates;
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any mandatory or optional sinking funds or analogous provisions,
or provisions for redemption at the option of the holder;
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any redemption provisions, including redemption prices;
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any terms and conditions upon which we will repurchase debt
securities at the option of the holders of the debt securities;
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the denominations in which debt securities will be issuable, if
other than denominations of $1,000 and integral multiples of
$1,000;
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the currency of payment of the debt securities if other than
U.S. dollars and the manner of determining the equivalent
amount in U.S. dollars;
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if payments are to be made, at your option or ours, in a
different currency, how the amount and manner of these payments
will be determined;
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any index used to determine the amount payable in respect of the
debt securities;
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if other than 100%, the portion of the principal amount that
shall be payable upon acceleration of maturity following an
event of default;
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whether the provisions described under Defeasance and
Discharge apply to the debt securities;
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any right to convert the series into shares of our common stock
or other securities or property;
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whether the debt securities will be issuable in the form of a
global security, the depository with respect to the debt
securities, and any special circumstances under which the global
security may be registered for transfer or exchange in the name
of a person other than the depository or its nominee;
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any change to the events of default that apply to the debt
securities and any change in the rights of the trustee or
holders to declare the principal amount due and payable
following an event of default;
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any change in the covenants contained in the indentures; and
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any other special features of the debt securities.
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Special U.S. Federal income tax considerations may apply to
a series of debt securities issued as original issue discount
securities. These tax considerations will be discussed in the
related prospectus supplement. In addition, if any special
U.S. Federal income tax considerations apply to a series of
debt securities denominated in a currency or currency unit other
than U.S. dollars, the related prospectus supplement will
describe those considerations.
Conversion
Rights
If debt securities of any series are convertible into our common
stock or other securities or property, the related prospectus
supplement will discuss the conversion terms. Those terms will
include provisions as to whether the conversion is mandatory or
at the option of the holder and may also include provisions for
calculating the number of shares of common stock or other
securities or property to be delivered upon conversion.
Subordination
of Subordinated Debt Securities
Holders of subordinated debt securities should recognize that
contractual provisions in the subordinated debt indenture may
prohibit us from making payments on those securities.
Subordinated debt securities are subordinate in right of
payment, to the extent and in the manner stated in the
subordinated debt indenture, to all our senior debt, including
all debt securities we have issued that constitute senior debt
and all debt securities we will issue under the senior debt
indenture.
The subordinated debt indenture defines senior debt
as all indebtedness and other payment obligations of Thomas
Weisel Partners relating to its debt, as defined below,
including:
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overdraft obligations;
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obligations under foreign exchange contracts and currency
exchange agreements;
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letters of credit;
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bankers acceptances;
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interest rate protection agreements; and
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any loans or advances from banks;
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whether or not evidenced by notes or similar instruments and
whether existing now or in the future. All amendments, renewals,
extensions, modifications and refundings of these obligations
will also be included in senior debt. Senior debt excludes the
subordinated debt securities and any other indebtedness or
obligations specifically designated as being subordinate, or not
superior, in right of payment to the subordinated debt
securities.
As defined in the subordinated debt indenture, debt
means:
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every obligation for borrowed money;
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every obligation evidenced by bonds, debentures, notes, or other
similar instruments;
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every reimbursement obligation under letters of credit,
bankers acceptances or similar facilities;
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every obligation issued or assumed as the deferred purchase
price of property or services, excluding trade accounts payable
or payment obligations arising in the ordinary course of
business;
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the redemption or repayment price of any redeemable
stock; and
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every obligation listed above incurred by another person, or
payment of dividends by another person, the payment of which is
guaranteed by Thomas Weisel Partners.
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The subordinated debt indenture provides that, unless all
principal of and any premium or interest on the senior debt has
been paid in full, no payment or other distribution may be made
in respect of any subordinated debt securities in the following
circumstances:
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in the event of any insolvency or bankruptcy proceedings, or any
receivership, liquidation, reorganization, debt restructuring or
other similar proceeding involving, or any liquidation,
dissolution or other winding up of, or any assignment for the
benefit of creditors or any other marshalling of assets and
liabilities of, Thomas Weisel Partners;
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in the event that any subordinated debt securities have been
declared due and payable before their stated maturity; or
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in the event of a default in any payment with respect to senior
debt, or any event of default relating to any senior debt that
would permit the acceleration of its maturity, or if any
judicial proceeding is pending in respect of any default of this
kind.
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For the purposes of the subordination provisions, the payment of
cash or delivery of property or securities upon conversion of a
subordinated debt security, excluding delivery of our common
stock and certain of our subordinated securities, will be deemed
a payment of the principal of that subordinated debt security.
Legal
Ownership
Street
Name and Other Indirect Holders
Investors who hold debt securities in accounts at banks or
brokers will generally not be recognized by us as legal holders
of debt securities. This is called holding in street name.
Instead, we would recognize only the bank or broker, or the
financial institution the bank or broker uses to hold its debt
securities. These intermediary banks, brokers and other
financial institutions pass along principal, interest and other
payments on the debt securities, either because they agree to do
so in their customer agreements or because they are legally
required to do so. If you hold debt securities in street name,
you should check with your own institution to find out:
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how it handles debt securities payments and notices;
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whether it imposes fees or charges;
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how it would handle voting, if it were ever required;
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whether and how you can instruct it to send you debt securities
registered in your own name so you can be a direct holder as
described below; and
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how it would pursue rights under the debt securities if there
were a default or other event triggering the need for holders to
act to protect their interests.
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Direct
Holders
Our obligations, as well as the obligations of the trustee and
those of any third parties employed by us or the trustee, under
the debt securities run only to persons who are registered as
holders of debt securities. As noted above, we do not have
obligations to you if you hold in street name or other indirect
means, either because you choose to hold debt securities in that
manner or because the debt securities are issued in the form of
global securities as described below. For example, once we make
payment to the registered holder we have no further
responsibility for the payment even if that holder is legally
required to pass the payment along to you as a street name
customer but does not do so.
Global
Securities
What is a Global Security?
A global security is a special
type of indirectly held security, as described above under
Street Name and Other Indirect Holders.
If we choose to issue debt securities in the form of global
securities, the ultimate beneficial owners of global securities
can only be indirect holders. We require that the global
security be registered in the name of a financial institution we
select.
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We also require that the debt securities included in the global
security not be transferred to the name of any other direct
holder unless the special circumstances described in the section
Legal Ownership and Book-Entry Issuance below occur.
The financial institution that acts as the sole direct holder of
the global security is called the depositary. Any person wishing
to own a security must do so indirectly by virtue of an account
with a broker, bank or other financial institution that in turn
has an account with the depositary. The prospectus supplement
indicates whether your series of debt securities will be issued
only in the form of global securities.
Further details of legal ownership are discussed in the section
Legal Ownership and Book-Entry Issuance.
In the remainder of this description you means
direct holders and not street name or other indirect holders of
debt securities. Indirect holders should read the previous
subsection entitled Street Name and Other Indirect
Holders.
Overview
of Remainder of This Description
The remainder of this description summarizes:
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Additional mechanics
relevant to the debt securities
under normal circumstances, such as how you transfer ownership
and where we make payments.
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Your rights under several
special situations
, such as if
we merge with another company or if we want to change a term of
the debt securities.
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Your rights if we
default
or experience other financial
difficulties.
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Our relationship with the trustee.
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Additional
Mechanics
Exchange
and Transfer
Unless otherwise provided in the prospectus supplement, debt
securities will have a minimum denomination of $1,000. You may
have your debt securities divided into more debt securities of
smaller denominations in integral multiples of $1,000, but not
below the minimum denomination, or combined into fewer debt
securities of larger denominations, as long as the total
principal amount is not changed. This is called an exchange.
You may exchange or transfer your debt securities at the office
of the trustee. The trustee acts as our agent for registering
debt securities in the names of holders and transferring debt
securities. We may change this appointment to another entity or
perform the service ourselves. The entity performing the role of
maintaining the list of registered holders is called the
security registrar. It will also register transfers of the debt
securities.
You will not be required to pay a service charge to transfer or
exchange debt securities, but you may be required to pay for any
tax or other governmental charge associated with the exchange or
transfer. The transfer or exchange of a debt security will only
be made if the security registrar is satisfied with your proof
of ownership.
If we designate additional transfer agents, they will be named
in the prospectus supplement. We may cancel the designation of
any particular transfer agent. We may also approve a change in
the office through which any transfer agent acts.
If the debt securities are redeemable and we redeem less than
all of the debt securities of a particular series, we may block
the transfer or exchange of debt securities during a specified
period of time in order to freeze the list of holders to prepare
the mailing. The period begins 15 days before the day we
mail the notice of redemption and ends on the day of that
mailing. We may also refuse to register transfers or exchanges
of debt securities selected for redemption. However, we will
continue to permit transfers and exchanges of the unredeemed
portion of any security being partially redeemed.
Payment
and Paying Agents
We will pay interest to you if you are a direct holder listed in
the trustees records at the close of business on a
particular day in advance of each due date for interest, even if
you no longer own the security on the interest due date. That
particular day, usually about two weeks in advance of the
interest due date, is called the regular record date and is
stated in the prospectus supplement.
23
We will pay interest, principal and any other money due on the
debt securities at the corporate trust office of the trustee in
Los Angeles, California. That office is currently located at
700 S. Flower Street, Suite 500, Los Angeles,
California 90017. You must make arrangements to have your
payments picked up at or wired from that office. We may also
choose to pay interest by mailing checks.
Interest on global securities will be paid to the holder of the
securities by wire transfer of
same-day
funds.
Holders buying and selling debt securities must work out between
them how to compensate for the fact that we will pay all the
interest for an interest period to the one who is the registered
holder on the regular record date. The most common manner is to
adjust the sales price of the debt securities to pro rate
interest fairly between buyer and seller. This pro rated
interest amount is called accrued interest.
Street name and other indirect holders should consult their
banks or brokers for information on how they will receive
payments.
We may also arrange for additional payment offices, and may
cancel or change these offices, including our use of the
trustees corporate trust office. These offices are called
paying agents. We may also choose to act as our own paying
agent. We must notify the trustee of changes in the paying
agents for any particular series of debt securities.
Notices
We and the trustee will send notices only to direct holders,
using their addresses as listed in the trustees records.
Regardless of who acts as paying agent, all money that we pay to
a paying agent that remains unclaimed at the end of two years
after the amount is due to direct holders will be repaid, upon
request by Thomas Weisel Partners, to Thomas Weisel Partners.
After that two-year period, you may look only to Thomas Weisel
Partners for payment and not to the trustee, any other paying
agent or anyone else.
Special
Situations
Mergers
and Similar Events
We are generally permitted to consolidate or merge with another
company or firm. We are also permitted to sell or lease
substantially all of our assets to another firm or to buy or
lease substantially all of the assets of another firm. However,
we may not take any of these actions unless certain specified
conditions are met, including the following:
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Where we merge out of existence or sell or lease our assets, the
other firm must be an entity that is organized under
U.S. or Canadian laws and must assume our obligations on
the debt securities.
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The merger, sale or lease of assets or other transaction must
not cause a default on the debt securities, and we must not
already be in default. For purposes of this test, a default
would include an event of default that has occurred and not been
cured, as described under Events of
Default What Is an Event of Default? A default
for this purpose would also include any event that would be an
event of default if the requirements for giving us a notice of
default or for our default having to continue for a specific
period of time were disregarded.
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We must deliver to the trustee an officers certificate and
opinion of counsel confirming that, among others, the merger,
sale or lease of assets or other transaction complies with the
above conditions and, in the case of a merger or consolidation
in which we merge out of existence and our successor is an
entity organized under the law of any province in Canada, that
the merger will not result in any material adverse tax
consequences to holders of debt securities.
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Modification
and Waiver
There are three types of changes we can make to the indentures
and the debt securities.
Changes Requiring Your Approval.
First, there
are changes that cannot be made to your debt securities without
your specific approval. Following is a list of those types of
changes that require the approval of each holder of debt
securities:
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change the stated maturity of the principal or interest on a
debt security;
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reduce any amounts due on a debt security;
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reduce the amount of principal payable upon acceleration of the
maturity of a debt security following a default;
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change the place or currency of payment on a debt security;
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impair your right to sue for payment;
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in the case of subordinated debt securities, modify the
subordination provisions in a manner adverse to the holders;
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reduce the percentage of holders of debt securities whose
consent is needed to modify or amend the indentures;
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reduce the percentage of holders of debt securities whose
consent is needed to waive compliance with the indentures or to
waive defaults;
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modify any other aspect of the provisions dealing with
modification and waiver of the indentures; and
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any change that adversely affects certain of your conversion
rights or decreases the conversion rate or increases your
conversion price.
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Changes Requiring a Majority Approval.
The
second type of change to the indentures and the debt securities
is the kind that requires an approval by holders of debt
securities owning a majority of the principal amount of the
particular series affected. Most changes fall into this
category. Majority approval would be required for us to obtain a
waiver of all or part of any covenants, or a waiver of a past
default. However, we cannot obtain a waiver of a payment default
or any other aspect of the indentures or the debt securities
listed in the first category described above under
Changes Requiring Your Approval unless
we obtain your individual consent to the waiver.
Changes Not Requiring Approval.
The third type
of change does not require any approval by holders of debt
securities. This type is limited to clarifications and other
changes that would not adversely affect holders of the debt
securities in any material respect.
Further
Details Concerning Votes and Consents
When seeking approval, we will use the following rules to
determine whether the holders of the requisite principal amount
of the outstanding securities have given, made or taken any
action under the indenture as of any date:
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For original issue discount securities, we will use the
principal amount that would be due and payable on the voting
date if the maturity of the debt securities were accelerated to
that date because of a default.
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For debt securities whose principal amount is not known (for
example, because it is based on an index), we will use a special
rule for that security described in the prospectus supplement.
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For debt securities denominated in one or more foreign
currencies or currency units, we will use the U.S. dollar
equivalent determined as described in the prospectus supplement.
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Debt securities will not be considered outstanding, and
therefore not eligible to vote, if we have deposited or set
aside in trust for you money for their payment or redemption, if
they have been fully defeased as described later under
Defeasance and Discharge or if they are
owned by Thomas Weisel Partners or any of its affiliates.
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We will generally be entitled to set any day as a record date to
determine the holders of outstanding debt securities that are
entitled to vote or take other action under the indentures. In
limited circumstances, the trustee will be entitled to set a
record date for action by holders. If we or the trustee set a
record date for a vote or other action to be taken by holders of
a particular series, that vote or action may be taken only by
persons who are holders of outstanding debt securities of that
series on the record date and must be taken within 180 days
following the record date or another period that we may specify,
or as the trustee may specify if it set the record date. We may
shorten or lengthen, but not beyond 180 days, this period
from time to time.
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Street name and other indirect holders should consult their
banks or brokers for information on how approval may be granted
or denied if we seek to change the indentures or the debt
securities or request a waiver.
25
Defeasance
and Discharge
The following discussion of full defeasance and discharge will
apply to your series of debt securities only if we choose to
have them apply to that series. If we do so choose, we will say
so in the prospectus supplement.
The indentures provide that if we choose to have the defeasance
and discharge provision applied to the debt securities, we can
legally release ourselves from any payment or other obligations
on the debt securities, except for the ministerial obligations
described below, if we put in place the following arrangements
for you to be repaid and comply with other requirements set
forth in the indentures:
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We must deposit in trust for the benefit of all direct holders
of the debt securities a combination of money and
U.S. government or U.S. government agency notes or
bonds that will generate enough cash to make any interest,
premium, principal or other payments on the debt securities on
their various due dates.
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We must deliver to the trustee a legal opinion of our counsel
confirming that we received from, or there has been published
by, the U.S. Internal Revenue Service a ruling, or there
has been a change in U.S. federal income tax law, and, in
either case, under then current U.S. law we may make the
above deposit without causing you to be taxed on the debt
securities any differently than if we did not make the deposit
and just repaid the debt securities ourselves.
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In the case of the subordinated debt securities, no default in
the payment of any principal of or premium or interest on any
senior debt may have occurred and be continuing, no event of
default with respect to any senior debt may have resulted in
acceleration of the maturity of the senior debt, and no other
event of default with respect to any senior debt may have
occurred and be continuing permitting the holders of such senior
debt to accelerate the maturity of the senior debt.
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In addition, the subordinated debt indenture provides that if we
choose to have the defeasance and discharge provision applied to
the subordinated debt securities, the subordination provisions
of the subordinated debt indenture will become ineffective.
However, even if we make the deposit in trust and opinion
delivery arrangements discussed above, a number of our
obligations relating to the debt securities will remain. These
include our obligations:
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to register the transfer and exchange of debt securities;
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to replace mutilated, destroyed, lost or stolen debt securities;
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to maintain paying agencies; and
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to hold money for payment in trust.
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Covenant
Defeasance
The indentures also allow us to choose whether covenant
defeasance will apply to any series of debt securities. If we do
so choose, we will say so in the prospectus supplement.
The indentures provide that if we choose to have the covenant
defeasance provision applied to any debt securities, we need not
comply with specified covenants in the debt securities. In
addition, covenant defeasance would also render ineffective any
event of default provisions relating to many of the restrictive
covenants. These provisions are discussed below under
Events of Default. Any of our other
obligations affected by covenant defeasance will be specified in
the prospectus supplement.
In order to exercise the covenant defeasance option, we must put
into place the same deposit in trust and similar opinion
delivery arrangements as those discussed above under
Defeasance and Discharge and comply with
other requirements set forth in the indentures.
Events of
Default
You will have special rights if an event of default occurs and
is not cured, as described later in this subsection.
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What Is an Event of Default?
The term event of
default means any of the following:
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We fail to pay the principal or any premium on a debt security
on the stated maturity date.
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We fail to pay interest on a debt security within 30 days
from the relevant due date.
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We do not deposit any sinking fund payment on its due date.
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We remain in breach of specified covenants in the indentures for
60 days after we receive a notice of default stating that
we are in breach. The notice must be sent by the trustee or by
holders of at least 25% in principal amount of the relevant
series of debt securities.
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We default under any indebtedness for money borrowed if:
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(a) that default either (1) results from the failure
to pay the principal of that indebtedness at its stated maturity
or (2) relates to an obligation other than the obligation
to pay the principal of that indebtedness at its stated maturity
and results in that indebtedness becoming or being declared due
and payable prior to the date on which it would otherwise have
become due and payable,
(b) the principal amount of that indebtedness, together
with the principal amount of any other indebtedness in default
for failure to pay principal at stated maturity or the maturity
of which has been so accelerated, aggregates $50,000,000 or more
at any one time outstanding and
(c) that indebtedness is not discharged, or the
acceleration is not rescinded or annulled, within 30 days
after written notice as provided in the indenture.
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A court enters a decree of bankruptcy, insolvency or
reorganization against us.
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We file voluntary proceedings under bankruptcy, insolvency or
reorganization laws.
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Any other event of default described in the prospectus
supplement occurs.
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Remedies If an Event of Default Occurs.
If an
event of default other than those described in the sixth or
seventh bullet point above has occurred and has not been cured,
the trustee or the holders of at least 25% in principal amount
of the debt securities of the affected series may declare the
entire principal amount of all the debt securities of that
series to be due and immediately payable. This is called a
declaration of acceleration of maturity. A declaration of
acceleration of maturity may be canceled by the holders of at
least a majority in principal amount of the debt securities of
the affected series. If any event of default described in the
sixth or seventh bullet point above occurs, the entire principal
amount of all the debt securities of that series shall
automatically, and without any declaration or other action on
the part of the trustee or any holder, become immediately due
and payable.
Except in cases of default, where the trustee has some special
duties, the trustee is not required to take any action under the
indentures at the request of any holders unless the holders
offer the trustee reasonable protection from expenses and
liability. This protection is called an indemnity. If reasonable
indemnity is provided, the holders of a majority in principal
amount of the outstanding debt securities of the relevant series
may direct the time, method and place of conducting any lawsuit
or other formal legal action seeking any remedy available to the
trustee. These majority holders may also direct the trustee in
performing other actions under the indentures.
Before you bypass the trustee and bring your own lawsuit or
other formal legal action or take other steps to enforce your
rights or protect your interests relating to the debt
securities, the following must occur:
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You must give the trustee written notice that an event of
default has occurred and remains uncured;
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The holders of at least 25% in principal amount of all
outstanding debt securities of the relevant series must make a
written request that the trustee take action because of the
default, and must offer reasonable indemnity to the trustee
against the cost and other liabilities of taking that action;
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The trustee must have not taken action for 60 days after
receipt of the above notice and offer of indemnity; and
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No inconsistent direction must have been given to the trustee
during the
60-day
period from the holders of a majority in principal amount of the
outstanding debt securities of the relevant series.
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Street name and other indirect holders should consult their
banks or brokers for information on how to give notice or
direction to or make a request of the trustee and to make or
cancel a declaration of acceleration.
We will furnish to the trustee every year a written statement
from some of our designated officers certifying that, to their
knowledge, we are in compliance with the indentures and the debt
securities, or else specifying any default.
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DESCRIPTION
OF PREFERRED STOCK WE MAY OFFER
This section describes the general terms and provisions of
the preferred stock we may offer. This information may not be
complete in all respects and is qualified entirely by reference
to our restated certificate of incorporation, as amended. The
specific terms of any series will be described in a prospectus
supplement. Those terms may differ from the terms discussed
below. Any series of preferred stock we issue will be governed
by our restated certificate of incorporation, as amended, and by
the certificate of designations relating to that series. We will
file the certificate of designations with the SEC and
incorporate it by reference as an exhibit to our registration
statement at or before the time we issue any preferred stock of
that series.
Authorized
Preferred Stock
Our restated certificate of incorporation, as amended,
authorizes us to issue 10,000,000 shares of preferred
stock, par value $0.01 per share. We may issue preferred stock
from time to time in one or more series, without stockholder
approval, when authorized by our board of directors.
Upon issuance of a particular series of preferred stock, our
board of directors is authorized to specify:
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the number of shares to be included in the series;
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the annual dividend rate for the series and any restrictions or
conditions on the payment of dividends;
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the redemption price, if any, and the terms and conditions of
redemption;
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any sinking fund provisions for the purchase or redemption of
the series;
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if the series is convertible, the terms and conditions of
conversion;
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the amounts payable to holders upon our liquidation, dissolution
or winding up; and
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any other rights, preferences and limitations relating to the
series.
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The boards ability to authorize, without stockholder
approval, the issuance of preferred stock with conversion and
other rights, may adversely affect the rights of holders of our
common stock or other series of preferred stock that may be
outstanding.
As of September 30, 2009, we had one share of preferred
stock issued and outstanding.
Specific
Terms of a Series of Preferred Stock
The preferred stock we may offer will be issued in one or more
series. Shares of preferred stock, when issued against full
payment of its purchase price, will be fully paid and
non-assessable. Their par value or liquidation preference,
however, will not be indicative of the price at which they will
actually trade after their issue. If necessary, the prospectus
supplement will provide a description of U.S. Federal
income tax consequences relating to the purchase and ownership
of the series of preferred stock offered by that prospectus
supplement.
The preferred stock will have the dividend, liquidation,
redemption and voting rights discussed below, unless otherwise
described in a prospectus supplement relating to a particular
series. A prospectus supplement will discuss the following
features of the series of preferred stock to which it relates:
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the designations and stated value per share;
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the number of shares offered;
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the amount of liquidation preference per share;
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the initial public offering price at which the preferred stock
will be issued;
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the annual dividend rate, the method of its calculation, the
dates on which dividends would be paid and the dates, if any,
from which dividends would cumulate;
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any redemption or sinking fund provisions;
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any conversion or exchange rights; and
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any additional voting, dividend, liquidation, redemption,
sinking fund and other rights, preferences, privileges,
limitations and restrictions.
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Rank
Unless otherwise stated in the prospectus supplement, the
preferred stock will have priority over our common stock with
respect to dividends and distribution of assets, but will rank
junior to all our outstanding indebtedness for borrowed money.
Any series of preferred stock could rank senior, equal or junior
to our other capital stock, as may be specified in a prospectus
supplement, as long as our restated certificate of incorporation
so permits.
Dividends
Holders of each series of preferred stock shall be entitled to
receive cash dividends to the extent specified in the prospectus
supplement when, as and if declared by our board of directors,
from funds legally available for the payment of dividends. The
rates and dates of payment of dividends of each series of
preferred stock will be stated in the prospectus supplement.
Dividends will be payable to the holders of record of preferred
stock as they appear on our books on the record dates fixed by
our board of directors. Dividends on any series of preferred
stock may be cumulative or non-cumulative, as discussed in the
prospectus supplement.
Convertibility
Shares of a series of preferred stock may be exchangeable or
convertible into shares of our common stock, another series of
preferred stock or other securities or property. The conversion
or exchange may be mandatory or optional. The prospectus
supplement will specify whether the preferred stock being
offered has any conversion or exchange features, and will
describe all the related terms and conditions.
Redemption
The terms, if any, on which shares of preferred stock of a
series may be redeemed will be discussed in the prospectus
supplement.
Liquidation
Upon any voluntary or involuntary liquidation, dissolution or
winding up of the affairs of Thomas Weisel Partners, holders of
each series of preferred stock will be entitled to receive
distributions upon liquidation in the amount described in the
related prospectus supplement plus an amount equal to any
accrued and unpaid dividends for the then-current dividend
period (including any accumulation in respect of unpaid
dividends for prior dividend periods, if dividends on that
series of preferred stock are cumulative). These distributions
will be made before any distribution is made on any securities
ranking junior to the preferred stock with respect to
liquidation, including our common stock. If the liquidation
amounts payable relating to the preferred stock of any series
and any other securities ranking on a parity regarding
liquidation rights are not paid in full, the holders of the
preferred stock of that series will share ratably in proportion
to the full liquidation preferences of each security. Holders of
our preferred stock will not be entitled to any other amounts
from us after they have received their full liquidation
preference.
Voting
Rights
The holders of shares of preferred stock will have no voting
rights, except:
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as otherwise stated in the applicable prospectus supplement;
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as otherwise stated in the certificate of designations
establishing the series; or
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as required by applicable law.
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No Other
Rights
The shares of a series of preferred stock will not have any
preferences, voting powers or relative, participating, optional
or other special rights except:
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as discussed above or in the prospectus supplement;
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as provided in our restated certificate of incorporation and in
the certificate of designations; and
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as otherwise required by law.
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Transfer
Agent
The transfer agent for each series of preferred stock will be
named and described in the prospectus supplement for that series.
31
DESCRIPTION
OF COMMON STOCK WE MAY OFFER
The following summary description of our common stock is
based on the provisions of our restated certificate of
incorporation, as amended, and amended and restated bylaws and
the applicable provisions of the Delaware General Corporation
Law. This information may not be complete in all respects and is
qualified entirely by reference to the provisions of our
restated certificate of incorporation, as amended, amended and
restated bylaws and the Delaware General Corporation Law. For
information on how to obtain copies of our restated certificate
of incorporation, as amended, and amended and restated bylaws,
see Available Information.
We may offer common stock issuable upon the conversion of debt
securities or preferred stock, the exercise of warrants and
pursuant to stock purchase contracts.
General
The following description of our capital stock is subject to our
restated certificate of incorporation, as amended, and amended
and restated bylaws and the provisions of applicable Delaware
law.
Authorized
Capital
We currently have authority to issue 100,000,000 shares of
common stock, par value $0.01 per share. As of November 4,
2009, 31,780,379 shares of our common stock were
outstanding, including 6,260,618 exchangeable shares of TWP
Acquisition Company (Canada), Inc., one of our wholly-owned
subsidiaries.
Voting
Rights
Each outstanding share of our common stock is entitled to one
vote on all matters submitted to a vote of stockholders. There
is no cumulative voting.
Dividend
and Liquidation Rights
The holders of outstanding shares of our common stock are
entitled to receive dividends out of assets legally available
for the payment of dividends at the times and in the amounts as
our board of directors may from time to time determine. The
shares of common stock are neither redeemable nor convertible.
Holders of our common stock have no preemptive or subscription
rights to purchase any securities of Thomas Weisel Partners.
Upon liquidation, dissolution or winding up of Thomas Weisel
Partners, the holders of our common stock are entitled to
receive pro rata the assets of Thomas Weisel Partners which are
legally available for distribution, after payment of all debts
and other liabilities and subject to the prior rights of any
holders of preferred stock then outstanding.
Statutory
Provisions Addressing Business Combinations
We are subject to the provisions of Section 203 of the
Delaware General Corporation Law. This statute prohibits a
publicly held Delaware corporation like us from engaging in a
business combination with an interested stockholder for a period
of three years after the date of the transaction in which the
stockholder became an interested stockholder, unless:
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prior to that date, our board of directors approved either the
business combination or the transaction that resulted in the
stockholder becoming an interested stockholder;
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upon completion of the transaction that resulted in that person
becoming an interested stockholder, the interested stockholder
owned at least 85% of the voting stock of the corporation
outstanding at the time the transaction commenced, excluding,
for purposes of determining the number of shares outstanding,
shares owned by directors who are also officers and by certain
employee stock plans; or
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on or after the date the stockholder became an interested
stockholder, the business combination is approved by our board
of directors and authorized by the affirmative vote, and not by
written consent, of at least two-thirds of our outstanding
voting stock, excluding the stock owned by the interested
stockholder.
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A business combination includes a merger or
consolidation, asset sale or other transaction resulting,
directly or indirectly, in a financial benefit to the interested
stockholder. An interested stockholder is a person,
other than us and any direct or indirect majority owned
subsidiary of ours, who:
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is the owner of 15% or more of any class of our outstanding
voting stock; or
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is an affiliate or associate of ours and was the owner of 15% or
more of any class of our outstanding voting stock at any time
within the preceding three years including the affiliates or
associates of that person.
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Section 203 expressly exempts from the requirements
described above any business combination by a corporation with
an interested stockholder who became an interested stockholder
at a time when the section did not apply to the corporation.
Exchange,
Transfer Agent and Registrar
Our common stock is listed on The Nasdaq Global Market. The
transfer agent and registrar for our common stock is BNY Mellon
Shareowner Services.
Certain
Anti-Takeover Matters
Our charter and by-laws include a number of provisions that may
have the effect of encouraging persons considering unsolicited
tender offers or other unilateral takeover proposals to
negotiate with our board of directors rather than pursue
non-negotiated takeover attempts. These provisions include:
Advance
Notice Requirements
Our by-laws establish advance notice procedures with regard to
shareholder proposals relating to the nomination of candidates
for election as directors or new business to be brought before
meetings of our shareholders. These procedures provide that
notice of such shareholder proposals must be timely and given in
writing to our Secretary prior to the meeting at which the
action is to be taken. Generally, to be timely, notice must be
received at our principal executive offices not less than
90 days nor more than 120 days prior to the
anniversary date of the annual meeting for the preceding year.
The notice must contain certain information specified in the
by-laws.
No
Written Consent of Shareholders
Our charter requires all shareholder actions to be taken by a
vote of the shareholders at an annual or special meeting, and
does not permit our shareholders to act by written consent
without a meeting.
Preferred
Stock
Our charter provides for 10,000,000 authorized shares of
preferred stock. The existence of authorized but unissued shares
of preferred stock may enable the board of directors to render
more difficult or to discourage an attempt to obtain control of
us by means of a merger, tender offer, proxy contest or
otherwise. For example, if in the due exercise of its fiduciary
obligations, the board of directors were to determine that a
takeover proposal is not in our best interests, the board of
directors could cause shares of preferred stock to be issued
without shareholder approval in one or more private offerings or
other transactions that might dilute the voting or other rights
of the proposed acquiror or insurgent shareholder or shareholder
group. In this regard, the charter grants our board of directors
broad power to establish the rights and preferences of
authorized and unissued shares of preferred stock. The issuance
of shares of preferred stock could decrease the amount of
earnings and assets available for distribution to holders of
shares of common stock. The issuance may also adversely affect
the rights and powers, including voting rights, of such holders
and may have the effect of delaying, deterring or preventing a
change in control of us.
Limitation
of Liability and Indemnification Matters
Our certificate of incorporation provides that a director of
ours will not be liable to us or our shareholders for monetary
damages for breach of fiduciary duty as a director, except in
certain cases where liability is mandated by
33
the Delaware General Corporation Law. Our certificate of
incorporation also provides for indemnification, to the fullest
extent permitted by law, by us of any person made or threatened
to be made a party to, or who is involved in, any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact
that such person is or was our director or officer, or at our
request, serves or served as a director or officer of any other
enterprise, against all expenses, liabilities, losses and claims
actually incurred or suffered by such person in connection with
the action, suit or proceeding. Our certificate of incorporation
also provides that, to the extent authorized from time to time
by our broad of directors, we may provide indemnification to any
one or more employees and other agents of ours to the extent and
effect determined by the board of directors to be appropriate
and authorized by the Delaware General Corporation Law. Our
certificate of incorporation also permits us to purchase and
maintain insurance for the foregoing and we expect to maintain
such insurance.
34
DESCRIPTION
OF WARRANTS WE MAY OFFER
The following summary outlines some of the provisions of each
warrant agreement, the warrants and the warrant certificates
that we may offer. This information may not be complete in all
respects and is qualified entirely by reference to the warrant
agreement with respect to the warrants of any particular series.
The specific terms of any series of warrants will be described
in the prospectus supplement. If so described in a prospectus
supplement, the terms of that series of warrants may differ from
the general description of terms presented below.
We may issue warrants for the purchase of our debt securities,
preferred stock, common stock or units. Warrants may be issued
independently or together with debt securities, preferred stock,
common stock or units, and may be attached to or separate from
those securities.
Warrant
Agreements
Each series of warrants will be evidenced by certificates issued
under a separate warrant agreement to be entered into between us
and a bank or trust company that we select as warrant agent with
respect to such series. The warrant agent will have its
principal office in the U.S. and have a combined capital
and surplus of at least $50,000,000.
Issuance
in Series
The prospectus supplement relating to a series of warrants will
mention the name and address of the warrant agent. The
prospectus supplement will describe the terms of the series of
warrants in respect of which this prospectus is being delivered,
including:
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the offering price;
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the currency for which the warrants may be purchased;
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the designation and terms of the securities with which the
warrants are issued and the number of warrants issued with each
security or each principal amount of security;
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the date on which the warrants and the related securities will
be separately transferable;
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in the case of warrants to purchase debt securities, the
principal amount of debt securities that can be purchased upon
exercise, and the price for purchasing those debt securities;
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in the case of warrants to purchase preferred stock, common
stock or depositary shares, the number of shares of preferred
stock or common stock or the number of depositary shares, as the
case may be, that can be purchased upon the exercise, and the
price for purchasing those shares;
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in the case of warrants to purchase units upon exercise, the
number and type of units that can be purchased upon exercise,
and the price of those units;
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the dates on which the right to exercise the warrants will
commence and expire;
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material U.S. Federal income tax consequences of holding or
exercising those warrants;
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the terms of the securities issuable upon exercise of those
warrants; and
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any other terms of the warrants.
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Warrant certificates may be exchanged for new warrant
certificates of different denominations, may be presented for
transfer registration, and may be exercised at the warrant
agents corporate trust office or any other office
indicated in the prospectus supplement. If the warrants are not
separately transferable from the securities with which they were
issued, this exchange may take place only if the certificates
representing the related securities are also exchanged. Prior to
warrant exercise, warrantholders will not have any rights as
holders of the underlying securities, including the right to
receive any principal, premium, interest, dividends, or payments
upon our liquidation, dissolution or winding up or to exercise
any voting rights.
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Exercise
of Warrants
Each warrant will entitle the holder to purchase the securities
specified in the prospectus supplement at the exercise price
mentioned in, or calculated as described in, the prospectus
supplement. Unless otherwise specified in the prospectus
supplement, warrants may be exercised at any time up to
5:00 p.m., New York time, on the expiration date mentioned
in that prospectus supplement. After the close of business on
the expiration date, unexercised warrants will become void.
Warrants may be exercised by delivery of the warrant certificate
representing the warrants to be exercised, or in the case of
global securities, as described below under Legal
Ownership and Book-Entry Issuance, by delivery of an
exercise notice for those warrants, together with certain
information, and payment to the warrant agent in immediately
available funds, as provided in the prospectus supplement, of
the required purchase amount. The information required to be
delivered will be on the reverse side of the warrant certificate
and in the prospectus supplement. Upon receipt of payment and
the warrant certificate or exercise notice properly executed at
the office indicated in the prospectus supplement, we will, in
the time period the relevant warrant agreement provides, issue
and deliver the securities purchasable upon such exercise. If
fewer than all of the warrants represented by such warrant
certificates are exercised, a new warrant certificate will be
issued for the remaining amount of warrants.
If mentioned in the prospectus supplement, securities may be
surrendered as all or part of the exercise price for warrants.
Antidilution
Provisions
In the case of warrants to purchase common stock, the exercise
price payable and the number of shares of common stock
purchasable upon warrant exercise may be adjusted in certain
events, including:
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the issuance of a stock dividend to common stockholders or a
combination, subdivision or reclassification of common stock;
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the issuance of rights, warrants or options to all common
stockholders entitling them to purchase common stock for an
aggregate consideration per share less than the current market
price per share of common stock;
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any distribution to our common stockholders of evidences of our
indebtedness or of assets, excluding cash dividends or
distributions referred to above; and
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any other events mentioned in the prospectus supplement.
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No adjustment in the number of shares purchasable upon warrant
exercise will be required until cumulative adjustments require
an adjustment of at least 1% of such number. No fractional
shares will be issued upon warrant exercise, but we will pay the
cash value of any fractional shares otherwise issuable.
Modification
We and any warrant agent may amend any warrant agreement and the
terms of the related warrants by executing a supplemental
warrant agreement, without any such warrantholders
consent, for the purpose of:
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curing any ambiguity, any defective provision contained in the
warrant agreement, or making any other corrections to the
warrant agreement that are not inconsistent with the provisions
of the warrant certificates;
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evidencing the succession of another corporation to us and its
assumption of our covenants contained in the warrant agreement
and the warrants;
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appointing a successor depository, if the warrants are issued in
the form of global securities;
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evidencing a successor warrant agents acceptance of
appointment with respect to the warrants;
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adding to our covenants for the warrantholders benefit or
surrendering any right or power we have under the warrant
agreement;
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issuing warrants in definitive form, if such warrants are
initially issued in the form of global securities; or
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amending the warrant agreement and the warrants as we deem
necessary or desirable and that will not adversely affect the
warrantholders interests in any material respect.
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We and the warrant agent may also amend any warrant agreement
and the related warrants by a supplemental agreement with the
consent of the holders of a majority of the unexercised warrants
affected by such amendment, for the purpose of adding, modifying
or eliminating any of the warrant agreements provisions or
of modifying the warrantholders rights. However, no such
amendment that:
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reduces the number or amount of securities receivable upon
warrant exercise or increases the exercise price;
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shortens the time period during which the warrants may be
exercised;
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otherwise adversely affects the exercise rights of
warrantholders in any material respect; or
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reduces the number of unexercised warrants the consent of the
holders of which is required for amending the warrant agreement
or the related warrants;
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may be made without the consent of each holder affected by that
amendment.
Consolidation,
Merger and Sale of Assets
Each warrant agreement will provide that we may consolidate or
merge with or into any other corporation or sell, lease,
transfer or convey all or substantially all of our assets to any
other corporation, provided that:
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either we are the continuing corporation, or the corporation
formed by or resulting from the consolidation or merger or that
receives the assets is organized under U.S. law and assumes
our obligations for the unexercised warrants and the performance
of all covenants of the relevant warrant agreements; and
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we or that successor corporation must not immediately be in
default under that warrant agreement.
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Enforceability
of Rights by Holders of Warrants
Each warrant agent will act solely as our agent under the
relevant warrant agreement and will not assume any obligation or
relationship of agency or trust for any warrantholder. A single
bank or trust company may act as warrant agent for more than one
issue of warrants. A warrant agent will have no duty or
responsibility in case we default in performing our obligations
under the relevant warrant agreement or warrant, including any
duty or responsibility to initiate any legal proceedings or to
make any demand upon us. Any warrantholder may, without the
warrant agents consent or consent of any other
warrantholder, enforce by appropriate legal action its right to
exercise that warrant.
Replacement
of Warrant Certificates
We will replace any destroyed, lost, stolen or mutilated warrant
certificate upon delivery to us and the relevant warrant agent
of satisfactory evidence of the ownership of that warrant
certificate and of its destruction, loss, theft or mutilation,
and (in the case of mutilation) surrender of that warrant
certificate to the relevant warrant agent, unless we have, or
the warrant agent has, received notice that the warrant
certificate has been acquired by a bona fide purchaser. That
warrantholder will also be required to provide indemnity
satisfactory to us and the relevant warrant agent before a
replacement warrant certificate will be issued.
Title
We, the warrant agents and any of their agents may treat the
registered holder of any warrant certificate as the absolute
owner of the warrants evidenced by that certificate for any
purpose and as the person entitled to exercise the rights
attaching to the warrants so requested, despite any notice to
the contrary. See Legal Ownership and Book-Entry
Issuance.
37
DESCRIPTION
OF UNITS WE MAY OFFER
This section outlines some of the provisions of the units and
the unit agreements. This information may not be complete in all
respects and is qualified entirely by reference to the unit
agreement with respect to the units of any particular series.
The specific terms of any series of units will be described in a
prospectus supplement. If so described in a particular
supplement, the specific terms of any series of units may differ
from the general description of terms presented below.
We may issue units comprised of one or more debt securities,
shares of common stock, shares of preferred stock, stock
purchase contracts and warrants in any combination. Each unit
will be issued so that the holder of the unit is also the holder
of each security included in the unit. Thus, the holder of a
unit will have the rights and obligations of a holder of each
included security. The unit agreement under which a unit is
issued may provide that the securities included in the unit may
not be held or transferred separately, at any time or at any
time before a specified date.
The prospectus supplement may describe:
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the designation and terms of the units and of the securities
comprising the units, including whether and under what
circumstances those securities may be held or transferred
separately;
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any provisions of the governing unit agreement that differ from
those described below; and
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any provisions for the issuance, payment, settlement, transfer
or exchange of the units or of the securities comprising the
units.
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The provisions described in this section, as well as those
described under Description of Debt Securities We May
Offer, Description of Preferred Stock We May
Offer, Description of Common Stock We May
Offer and Description of Warrants We May Offer
will apply to each unit and to any debt security, preferred
stock, common stock or warrant included in each unit,
respectively.
Issuance
in Series
We may issue units in such amounts and in as many distinct
series as we wish. This section summarizes terms of the units
that apply generally to all series. Most of the financial and
other specific terms of your series will be described in the
prospectus supplement.
Unit
Agreements
We will issue the units under one or more unit agreements to be
entered into between us and a bank or other financial
institution, as unit agent. We may add, replace or terminate
unit agents from time to time. We will identify the unit
agreement under which each series of units will be issued and
the unit agent under that agreement in the prospectus supplement.
The following provisions will generally apply to all unit
agreements unless otherwise stated in the prospectus supplement.
Enforcement
of Rights
The unit agent under a unit agreement will act solely as our
agent in connection with the units issued under that agreement.
The unit agent will not assume any obligation or relationship of
agency or trust for or with any holders of those units or of the
securities comprising those units. The unit agent will not be
obligated to take any action on behalf of those holders to
enforce or protect their rights under the units or the included
securities.
Except as indicated in the next paragraph, a holder of a unit
may, without the consent of the unit agent or any other holder,
enforce its rights as holder under any security included in the
unit, in accordance with the terms of that security and the
indenture, warrant agreement or other instrument under which
that security is issued. Those terms are described elsewhere in
this prospectus under the sections relating to debt securities,
preferred stock, common stock and warrants.
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Notwithstanding the foregoing, a unit agreement may limit or
otherwise affect the ability of a holder of units issued under
that agreement to enforce its rights, including any right to
bring a legal action, with respect to those units or any
securities, other than debt securities, that are included in
those units. Limitations of this kind will be described in the
prospectus supplement.
Modification
Without Consent of Holders
We and the applicable unit agent may amend any unit or unit
agreement without the consent of any holder:
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to cure any ambiguity;
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to correct or supplement any defective or inconsistent
provision; or
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to make any other change that we believe is necessary or
desirable and will not adversely affect the interests of the
affected holders in any material respect.
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We do not need any approval to make changes that affect only
units to be issued after the changes take effect. We may also
make changes that do not adversely affect a particular unit in
any material respect, even if they adversely affect other units
in a material respect. In those cases, we do not need to obtain
the approval of the holder of the unaffected unit; we need only
obtain any required approvals from the holders of the affected
units.
Modification
With Consent of Holders
We may not amend any particular unit or a unit agreement with
respect to any particular unit unless we obtain the consent of
the holder of that unit, if the amendment would:
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impair any right of the holder to exercise or enforce any right
under a security included in the unit if the terms of that
security require the consent of the holder to any changes that
would impair the exercise or enforcement of that right; or
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reduce the percentage of outstanding units or any series or
class the consent of whose holders is required to amend that
series or class, or the applicable unit agreement with respect
to that series or class, as described below.
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Any other change to a particular unit agreement and the units
issued under that agreement would require the following approval:
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If the change affects only the units of a particular series
issued under that agreement, the change must be approved by the
holders of a majority of the outstanding units of that
series; or
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If the change affects the units of more than one series issued
under that agreement, it must be approved by the holders of a
majority of all outstanding units of all series affected by the
change, with the units of all the affected series voting
together as one class for this purpose.
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These provisions regarding changes with majority approval also
apply to changes affecting any securities issued under a unit
agreement, as the governing document.
In each case, the required approval must be given by written
consent.
Unit
Agreements Will Not Be Qualified Under Trust Indenture
Act
No unit agreement will be qualified as an indenture, and no unit
agent will be required to qualify as a trustee, under the
Trust Indenture Act. Therefore, holders of units issued
under unit agreements will not have the protections of the
Trust Indenture Act with respect to their units.
Title
Thomas Weisel Partners, the unit agents and any of their agents
may treat the registered holder of any unit certificate as an
absolute owner of the units evidenced by that certificate for
any purpose and as the person entitled to exercise the rights
attaching to the units so requested, despite any notice to the
contrary. See Legal Ownership and Book-Entry
Issuance.
39
LEGAL
OWNERSHIP AND BOOK-ENTRY ISSUANCE
Unless otherwise mentioned in the prospectus supplement,
securities will be issued in the form of one or more global
certificates, or global securities, registered in the name of a
depositary or its nominee. Unless otherwise mentioned in the
prospectus supplement, the depositary will be The Depository
Trust Company, commonly referred to as DTC. DTC has
informed us that its nominee will be Cede & Co.
Accordingly, we expect Cede & Co. to be the initial
registered holder of all securities that are issued in global
form. No person that acquires a beneficial interest in those
securities will be entitled to receive a certificate
representing that persons interest in the securities
except as mentioned below or in the prospectus supplement.
Unless definitive securities are issued under the limited
circumstances described below,
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all references in this prospectus to actions by holders of
securities issued in global form refer to actions taken by DTC
upon instructions from its participants; and
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all references to payments and notices to holders refer to
payments and notices to DTC or Cede & Co., as the
registered holder of these securities.
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DTC has informed us that it is a limited purpose trust company
organized under the New York Banking Law, a banking organization
within the meaning of the New York Banking Law, a member of the
Federal Reserve System, a clearing corporation within the
meaning of the New York Uniform Commercial Code, and a clearing
agency registered under Section 17A of the Securities
Exchange Act of 1934, as amended, and that it was created to
hold securities for its participating organizations and to
facilitate clearance and settlement of securities transactions
among its participants through electronic book-entry. This
eliminates the need for physical movement of certificates.
DTCs participants include securities brokers and dealers,
banks, trust companies and clearing corporations. Indirect
access to the DTC system also is available to others, such as
banks, brokers, dealers and trust companies, that clear through
or maintain a custodial relationship with a participant, either
directly or indirectly.
Persons that are not participants or indirect participants but
desire to purchase, sell or otherwise transfer ownership of, or
other interests in, securities may do so only through
participants and indirect participants. Under a book-entry
format, holders may experience some delay in their receipt of
payments, as these payments will be forwarded by our designated
agent to Cede & Co., as nominee for DTC. DTC will
forward these payments to its participants, who will then
forward them to indirect participants or holders. Holders will
not be recognized by the relevant registrar, transfer agent,
warrant agent or unit agent as registered holders of the
securities entitled to the benefits of our restated certificate
of incorporation, as amended,
and/or
the
applicable indenture, warrant agreement or unit agreement.
Beneficial owners that are not participants will be permitted to
exercise their rights only indirectly through and according to
the procedures of participants and, if applicable, indirect
participants.
Under the rules, regulations and procedures governing DTC and
its operations as currently in effect, DTC will be required to
make book-entry transfers of securities among participants and
to receive and transmit payments to participants. DTC rules
require participants and indirect participants with which
beneficial securities owners have accounts to make book-entry
transfers and receive and transmit payments on behalf of their
respective account holders.
Because DTC can act only on behalf of participants, the ability
of a beneficial owner of securities issued in global form to
pledge those securities to non-participants may be limited due
to the unavailability of physical certificates for these
securities. Beneficial owners may also be unable to sell
interests in their securities to some insurance companies and
other institutions that are required by law to own their
securities in the form of physical certificates.
DTC has advised us that it will take any action permitted to be
taken by a registered holder of any securities under its
certificate of incorporation or the relevant indenture, warrant
agreement or unit agreement only at the direction of one or more
participants to whose accounts with DTC those securities are
credited.
Unless otherwise mentioned in the prospectus supplement, a
global security will be exchangeable for definitive securities
registered in the names of persons other than DTC or its nominee
only if:
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DTC notifies us that it is unwilling or unable to continue as
depositary for that global security or if DTC ceases to be a
clearing agency registered under the Exchange Act when it is
required to be so registered;
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We execute and deliver to the relevant registrar, transfer
agent, trustee, warrant agent
and/or
unit
agent an order complying with the requirements of our restated
certificate of incorporation, as amended, and amended and
restated bylaws or the relevant indenture, warrant agreement
and/or
unit
agreement that this global security shall be so
exchangeable; or
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there has occurred and is continuing a default in the payment of
any amount due in respect of the securities or, in the case of
debt securities, an event of default or an event that, with the
giving of notice or lapse of time, or both, would constitute an
event of default with respect to those debt securities.
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In these circumstances, the global security will be exchangeable
for securities registered in the names that DTC directs.
DTC will generally not be required to notify its participants of
the availability of definitive securities. When DTC surrenders
the global security and delivers instructions for
re-registration, the registrar, transfer agent, trustee,
depositary, warrant agent or unit agent, as the case may be,
will reissue the securities as definitive securities.
Except as described above, a global security may not be
transferred except as a whole to DTC or another nominee of DTC,
or to a successor depositary we appoint. Except as described
above, DTC may not sell, assign, transfer or otherwise convey
any beneficial interest in a global security unless the
beneficial interest is in an amount equal to an authorized
denomination for those securities.
None of Thomas Weisel Partners Group, Inc., the trustees, any
registrar and transfer agent, any warrant agent or any unit
agent, or any of their agents, will have any responsibility for
any aspect of DTCs or any participants records
relating to, or for payments made on account of, beneficial
interests in a global security, or for maintaining, supervising
or reviewing any records relating to those beneficial interests.
41
PLAN OF
DISTRIBUTION (CONFLICTS OF INTEREST)
We may sell the securities offered by this prospectus and
applicable prospectus supplements:
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through underwriters or dealers;
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through agents;
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directly to purchasers;
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as a dividend or distribution or in a subscription rights
offering to our existing securityholders; or
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through a combination of any such methods of sale.
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If underwriters are used to sell securities, we will enter into
an underwriting agreement or similar agreement with them at the
time of the sale to them. In that connection, underwriters may
receive compensation from us in the form of underwriting
discounts or commissions and may also receive commissions from
purchasers of the securities for whom they may act as agent. Any
such underwriter, dealer or agent may be deemed to be an
underwriter within the meaning of the Securities Act of 1933, as
amended.
The applicable prospectus supplement relating to the securities
will set forth:
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the offering terms, including the name or names of any
underwriters, dealers or agents;
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the purchase price of the securities and the proceeds to us, if
any, from such sale;
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any underwriting discounts, concessions, commissions and other
items constituting compensation to underwriters, dealers or
agents;
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any initial public offering price;
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any discounts or concessions allowed or reallowed or paid by
underwriters or dealers to other dealers;
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in the case of debt securities, the interest rate, maturity and
redemption provisions;
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in the case of convertible debt securities, the conversion rate
and other terms, conditions and features; and
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any securities exchanges on which the securities may be listed.
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If underwriters or dealers are used in the sale, the securities
will be acquired by the underwriters or dealers for their own
account and may be resold from time to time in one or more
transactions in accordance with the rules of The Nasdaq Global
Market:
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at a fixed price or prices that may be changed;
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at market prices prevailing at the time of sale;
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at prices related to such prevailing market prices; or
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at negotiated prices.
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The securities may be offered to the public either through
underwriting syndicates represented by one or more managing
underwriters or directly by one or more of such firms. Unless
otherwise set forth in an applicable prospectus supplement, the
obligations of underwriters or dealers to purchase the
securities will be subject to certain conditions precedent and
the underwriters or dealers will be obligated to purchase all
the securities if any are purchased. Any public offering price
and any discounts or concessions allowed or reallowed or paid by
underwriters or dealers to other dealers may be changed from
time to time.
Securities may be sold directly by us or through agents
designated by us from time to time. Any agent involved in the
offer or sale of the securities in respect of which this
prospectus and a prospectus supplement is delivered will be
named, and any commissions payable by us to such agent will be
set forth, in the prospectus supplement. Unless otherwise
indicated in the prospectus supplement, any such agent will be
acting on a best efforts basis for the period of its appointment.
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If we offer securities in a subscription rights offering to our
existing security holders, we may enter into a standby
underwriting agreement with dealers, acting as standby
underwriters. We may pay the standby underwriters a commitment
fee for the securities they commit to purchase on a standby
basis. If we do not enter into a standby underwriting
arrangement, we may retain a dealer-manager to manage a
subscription rights offering for us.
If so indicated in the prospectus supplement, we will authorize
underwriters, dealers or agents to solicit offers from certain
specified institutions to purchase securities from us at the
public offering price set forth in the prospectus supplement
pursuant to delayed delivery contracts providing for payment and
delivery on a specified date in the future. Such contracts will
be subject to any conditions set forth in the prospectus
supplement and the prospectus supplement will set forth the
commissions payable for solicitation of such contracts. The
underwriters and other persons soliciting such contracts will
have no responsibility for the validity or performance of any
such contracts.
Underwriters, dealers and agents may be entitled under
agreements entered into with us to be indemnified by us against
certain civil liabilities, including liabilities under the
Securities Act of 1933 as amended, or to contribution by us to
payments which they may be required to make. The terms and
conditions of such indemnification will be described in an
applicable prospectus supplement. Underwriters, dealers and
agents may be customers of, engage in transactions with, or
perform services for, us in the ordinary course of business.
Any underwriters to whom securities are sold by us for public
offering and sale may make a market in such securities, but such
underwriters will not be obligated to do so and may discontinue
any market making at any time without notice. No assurance can
be given as to the liquidity of the trading market for any
securities.
Certain persons participating in any offering of securities may
engage in transactions that stabilize, maintain or otherwise
affect the price of the securities offered. In connection with
any such offering, the underwriters or agents, as the case may
be, may purchase and sell securities in the open market. These
transactions may include overallotment and stabilizing
transactions and purchases to cover syndicate short positions
created in connection with the offering. Stabilizing
transactions consist of certain bids or purchases for the
purpose of preventing or retarding a decline in the market price
of the securities and syndicate short positions involve the sale
by the underwriters or agents, as the case may be, of a greater
number of securities than they are required to purchase from us
in the offering. The underwriters may also impose a penalty bid,
whereby selling concessions allowed to syndicate members or
other broker-dealers for the securities sold for their account
may be reclaimed by the syndicate if such securities are
repurchased by the syndicate in stabilizing or covering
transactions. These activities may stabilize, maintain or
otherwise affect the market price of the securities, which may
be higher than the price that might otherwise prevail in the
open market, and if commenced, may be discontinued at any time.
These transactions may be effected on The Nasdaq Global Market,
in the over-the-counter market or otherwise. These activities
will be described in more detail in the sections entitled
Plan of Distribution (Conflicts of Interest) or
Underwriting in the applicable prospectus supplement.
In compliance with the guidelines of the Financial Industry
Regulatory Authority, Inc. (FINRA), the maximum commission or
discount to be received by any FINRA member or independent
broker dealer may not exceed 8% of the offering amount for any
offering of securities under this prospectus.
Conflicts
of Interest
Thomas Weisel Partners LLC, a broker-dealer registered with
FINRA and a wholly-owned subsidiary of Thomas Weisel Partners
Group, Inc., may participate in offerings of securities under
this registration statement. As such, Thomas Weisel Partners
Group, Inc. has a conflict of interest as defined in
NASD Conduct Rule 2720(f)(5)(B) and any offerings under
this registration statement will be conducted in compliance with
Rule 2720. No underwriter having a Rule 2720 conflict
of interest will confirm sales to any account over which the
underwriter exercises discretionary authority without the
specific written approval of the accountholder.
43
VALIDITY
OF SECURITIES
The validity of the securities offered hereby will be passed
upon for us by Sullivan & Cromwell LLP, Palo Alto,
California.
EXPERTS
The financial statements incorporated in this prospectus by
reference from Thomas Weisel Partners Group, Inc. and
Subsidiaries Annual Report on
Form 10-K
for the year ended December 31, 2008, and the effectiveness
of Thomas Weisel Partners Group, Inc. and Subsidiaries
internal control over financial reporting have been audited by
Deloitte & Touche LLP, an independent registered
public accounting firm, as stated in their reports, which are
incorporated herein by reference. Such financial statements have
been so incorporated in reliance upon the reports of such firm
given upon their authority as experts in accounting and auditing.
AVAILABLE
INFORMATION
Where You
Can Find More Information
We have filed with the Securities and Exchange Commission, or
SEC, a registration statement on
Form S-3
under the Securities Act of 1933, as amended, with respect to
the securities offered hereby. This prospectus does not contain
all of the information set forth in the registration statement
and the exhibits and schedules thereto. For further information
with respect to us and our securities, reference is made to the
registration statement and the exhibits and any schedules filed
therewith. Statements contained in this prospectus as to the
contents of any contract or other document referred to are not
necessarily complete and in each instance, if such contract or
document is filed as an exhibit, reference is made to the copy
of such contract or other document filed as an exhibit to the
registration statement, each statement being qualified in all
respects by such reference. A copy of the registration
statement, including the exhibits and schedules thereto, may be
read and copied at the SECs Public Reference Room at
100 F Street, N.E., Washington, DC 20549. Information
on the operation of the Public Reference Room may be obtained by
calling the SEC at
1-800-SEC-0330.
In addition, the SEC maintains an Internet website at
http://www.sec.gov
that contains reports, proxy and information statements, and
other information regarding issuers that file electronically
with the SEC. Interested persons can electronically access the
registration statement, including the exhibits and any schedules
thereto, at the SECs website.
We are subject to the full informational requirements of the
Securities Exchange Act of 1934, as amended. We fulfill our
obligations with respect to such requirements by filing annual,
quarterly and current reports, proxy statements and other
information with the SEC. We furnish our stockholders with
annual reports containing consolidated financial statements
certified by an independent registered public accounting firm.
We also maintain an Internet website at
http://www.tweisel.com.
The information on our website shall not be deemed to be
incorporated into this prospectus or the registration statement
of which it forms a part.
Our Investor Relations Department can be contacted at Thomas
Weisel Partners Group, Inc., One Montgomery Street,
San Francisco, California 94104, Attention: Investor
Relations; telephone:
415-364-2500,
email:
investorrelations@tweisel.com
.
Incorporation
of Certain Information by Reference
Some of the information that you may want to consider in
deciding whether to invest in the securities is not included in
this prospectus, but rather is incorporated by reference to
certain reports that we have filed with the SEC. This permits us
to disclose important information to you by referring to those
documents rather than repeating them in full in the prospectus.
The information incorporated by reference in this prospectus
contains important business and financial information. In
addition, information that we file with the SEC after the date
of this prospectus and prior to the completion of this offering
will update and supersede the information contained in this
prospectus and incorporated filings. We incorporate by reference
the following documents filed by us with the SEC:
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|
|
|
|
our annual report on
Form 10-K
and
10-K/A
for the fiscal year ended December 31, 2008;
|
44
|
|
|
|
|
our quarterly reports on
Form 10-Q
for the three months ended March 31, 2009, the three and
six months ended June 30, 2009 and the three and nine
months ended September 30, 2009;
|
|
|
|
our Current Reports on
Form 8-K
filed on February 12, 2009 (other than the information
furnished under Item 2.02 thereof and Exhibit 99.1
thereto), March 16, 2009, April 29, 2009 (other than
the information furnished under Item 2.02 thereof and
Exhibit 99.1 thereto), June 3, 2009, July 27,
2009, July 29, 2009 (other than the information furnished
under Items 2.02 and 7.01 thereof and Exhibit 99.1
thereto), September 25, 2009 and October 28, 2009
(other than the information furnished under Item 2.02
thereof and Exhibit 99.1 thereto);
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|
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|
the description of our common stock contained in our
registration statement on
Form 8-A,
filed with the SEC on January 17, 2006, including any
amendments or reports filed for the purpose of updating such
description; and
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|
|
|
all filings we make with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as
amended after the date of this prospectus but prior to the
completion of the offering of the securities offered pursuant to
this prospectus.
|
Any statement contained in a document incorporated by reference,
or deemed to be incorporated by reference, in this prospectus
shall be deemed to be modified or superseded for purposes of
this prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is
incorporated by reference in this prospectus modifies or
supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this prospectus. Statements
contained in this prospectus as to the contents of any contract
or other document referred to in this prospectus do not purport
to be complete and where reference is made to the particular
provisions of such contract or other document, such provisions
are qualified in all respects by reference to all of the
provisions of such contract or other document.
You may request a copy of these filings, at no cost, by writing
or telephoning us at the following address: Thomas Weisel
Partners Group, Inc., One Montgomery Street, San Francisco,
California 94104, Attention: Investor Relations; telephone:
415-364-2500,
e-mail:
investorrelations@tweisel.com
.
The information in this prospectus may not contain all of the
information that may be important to you. You should read the
entire prospectus, as well as the documents incorporated by
reference in the prospectus, before making an investment
decision.
45
PROSPECTUS ,
2009
Thomas
Weisel Partners Group, Inc.
$100,000,000
DEBT SECURITIES
PREFERRED STOCK
COMMON STOCK
WARRANTS
UNITS
PART II
Information
Not Required in Prospectus
|
|
ITEM 14.
|
OTHER
EXPENSES OF ISSUANCE AND DISTRIBUTION
|
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|
|
|
|
|
|
Amount
|
|
|
SEC registration fee
|
|
$
|
5,580
|
|
Trustees fees and expenses
|
|
$
|
15,000
|
|
Legal fees and expenses
|
|
$
|
100,000
|
|
Accounting fees and expenses
|
|
$
|
5,000
|
|
Printing expenses
|
|
$
|
7,000
|
|
FINRA filing fee
|
|
$
|
10,500
|
|
Miscellaneous
|
|
$
|
10,000
|
|
Total
|
|
$
|
153,080
|
|
|
|
|
|
|
Each of the amounts set forth above, other than the SEC
registration fee, is an estimate.
|
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ITEM 15.
|
LIABILITY
AND INDEMNIFICATION OF DIRECTORS AND OFFICERS
|
Section 145 of the Delaware General Corporation Law
provides that a corporation may indemnify directors and officers
as well as other employees and individuals against expenses
(including attorneys fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by such
person in connection with any threatened, pending or completed
actions, suits or proceedings in which such person is made a
party by reason of such person being or having been a director,
officer, employee or agent to the Registrant. The Delaware
General Corporation Law provides that Section 145 is not
exclusive of other rights to which those seeking indemnification
may be entitled under any bylaw, agreement, vote of stockholders
or disinterested directors or otherwise. Article Eleventh
of the Registrants Certificate of Incorporation provides
for indemnification by the Registrant of its directors, officers
and employees to the fullest extent permitted by the Delaware
General Corporation Law.
Section 102(b)(7) of the Delaware General Corporation Law
permits a corporation to provide in its certificate of
incorporation that a director of the corporation shall not be
personally liable to the corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the
directors duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation
of law, (iii) for unlawful payments of dividends or
unlawful stock repurchases, redemptions or other distributions,
or (iv) for any transaction from which the director derived
an improper personal benefit. The Registrants Certificate
of Incorporation provides for such limitation of liability to
the fullest extent permitted by the Delaware General Corporation
Law.
The Registrant maintains standard policies of insurance under
which coverage is provided (a) to its directors and
officers against loss rising from claims made by reason of
breach of duty or other wrongful act, while acting in their
capacity as directors and officers of the Registrant, and
(b) to the Registrant with respect to payments which may be
made by the Registrant to such officers and directors pursuant
to any indemnification provision contained in the
Registrants Certificate of Incorporation or otherwise as a
matter of law.
The Registrant has also entered into separate indemnification
agreements with each of its directors and executive officers
which may be broader than the specific indemnification
provisions contained in the Delaware General Corporation Law.
II-1
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ITEM 16.
|
INDEX
TO EXHIBITS.
|
|
|
|
|
|
Exhibit
|
|
|
No.
|
|
Description
|
|
|
1
|
.1
|
|
Form of Underwriting Agreement for Preferred Stock, Common
Stock, Warrants and Units
|
|
1
|
.2
|
|
Form of Underwriting Agreement for Debt Securities
|
|
4
|
.1
|
|
Certificate of Incorporation (incorporated by reference to
Exhibit 3.1 of the Companys Registration Statement on
Form S-1,
File
No. 333-129108)
|
|
4
|
.2
|
|
By-Laws (incorporated by reference to Exhibit 3.2 of the
Companys Registration Statement on
Form S-1,
File
No. 333-129108)
|
|
4
|
.3
|
|
Certificate of Designations, Preferences and Rights of the
Special Voting Preferred Stock of the Company (incorporated by
reference to Exhibit 3.3 of the Companys Current
Report on
Form 8-K
filed January 3, 2008, File
No. 000-51730)
|
|
4
|
.4
|
|
Form of Certificate of Designations
|
|
4
|
.5
|
|
Form of Senior Indenture between the Company and The Bank of New
York Mellon Trust Company N.A., as Trustee thereunder
|
|
4
|
.6
|
|
Form of Subordinated Indenture between the Company and The Bank
of New York Mellon Trust Company N.A., as Trustee thereunder
|
|
4
|
.7
|
|
Form of Warrant Agreement
|
|
4
|
.8(1)
|
|
Form of Unit Agreement
|
|
5
|
.1
|
|
Opinion and Consent of Sullivan & Cromwell LLP
|
|
12
|
.1
|
|
Computation of Ratio of Earnings to Fixed Charges
|
|
23
|
.1
|
|
Consent of Deloitte & Touche LLP, Independent
Registered Public Accounting Firm
|
|
23
|
.2
|
|
Consent of Sullivan & Cromwell LLP (contained in
Exhibit 5.1)
|
|
24
|
|
|
Powers of Attorney (included on the signature pages hereto)
|
|
25
|
.1
|
|
Form T-1
Statement of Eligibility under the Trust Indenture Act of
1939 of The Bank of New York Mellon Trust Company N.A., as
Trustee under the Senior Indenture
|
|
25
|
.2
|
|
Form T-1
Statement of Eligibility under the Trust Indenture Act of
1939 of The Bank of New York Mellon Trust Company N.A., as
Trustee under the Subordinated Indenture
|
|
|
|
(1)
|
|
A form of Unit Agreement, if any, to be filed by amendment or as
an exhibit to a document to be incorporated by reference herein
in connection with an offering of the offered securities.
|
The undersigned Registrant hereby undertakes:
To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) to include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the
maximum aggregate offering price set forth in the
Calculation of Registration Fee table in the
effective registration statement; and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement;
II-2
provided
,
however
, that paragraphs (i),
(ii) and (iii) do not apply if the information
required to be included in a post-effective amendment by those
paragraphs is contained in reports filed with or furnished to
the Commission by the Registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that
are incorporated by reference in the registration statement, or
is contained in a form of prospectus filed pursuant to
Rule 424(b) that is part of the registration statement.
That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial
bona fide
offering thereof.
To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
That, for the purpose of determining liability under the
Securities Act of 1933 to any purchaser:
(A) Each prospectus filed by a Registrant pursuant to Rule
424(b)(3) shall be deemed to be part of the registration
statement as of the date the filed prospectus was deemed part of
and included in the registration statement; and
(B) Each prospectus required to be filed pursuant to Rule
424(b)(2), (b)(5) or (b)(7) as part of a registration statement
in reliance on Rule 430B relating to an offering made
pursuant to Rule 415(a)(1)(i), (vii) or (x) for the
purpose of providing the information required by
Section 10(a) of the Securities Act of 1933 shall be deemed
to be part of and included in the registration statement as of
the earlier of the date such form of prospectus is first used
after effectiveness or the date of the first contract of sale of
securities in the offering described in the prospectus. As
provided in Rule 430B, for liability purposes of the issuer
and any person that is at that date an underwriter, such date
shall be deemed to be a new effective date of the registration
statement relating to the securities in the registration
statement to which the prospectus relates, and the offering of
such securities at that time shall be deemed to be the initial
bona fide
offering thereof.
Provided
,
however
, that no statement made in a registration
statement or prospectus that is part of the registration
statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or
prospectus that is part of the registration statement will, as
to a purchaser with a time of contract of sale prior to such
effective date, supersede or modify any statement that was made
in the registration statement or prospectus that was part of the
registration statement or made in any such document immediately
prior to such effective date.
That, for the purpose of determining liability of the Registrant
under the Securities Act of 1933 to any purchaser in the initial
distribution of the securities, the undersigned Registrant
undertakes that in a primary offering of securities of the
undersigned Registrant pursuant to this registration statement,
regardless of the underwriting method used to sell the
securities to the purchaser, if the securities are offered or
sold to such purchaser by means of any of the following
communications, the undersigned Registrant will be a seller to
the purchaser and will be considered to offer or sell such
securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the
undersigned Registrant relating to the offering required to be
filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering
prepared by or on behalf of the undersigned Registrant or used
or referred to by the undersigned Registrant;
(iii) The portion of any other free writing prospectus
relating to the offering containing material information about
the undersigned Registrant or its securities provided by or on
behalf of the undersigned Registrant; and
(iv) Any other communication that is an offer in the
offering made by the undersigned Registrant to the purchaser.
That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrants
annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plans annual report pursuant
to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration
statement shall be deemed to be a new registration
II-3
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial
bona fide
offering thereof.
With respect to any offering in which securities are to be
offered to existing security holders pursuant to warrants or
rights and any securities not taken by security holders are to
be reoffered to the public, the Registrant hereby undertakes to
supplement the prospectus, after the expiration of the
subscription period, to set forth the results of the
subscription offer, the transactions by the underwriters during
the subscription period, the amount of unsubscribed securities
to be purchased by the underwriters, and the terms of any
subsequent reoffering thereof. If any public offering by the
underwriters is to be made on terms differing from those set
forth on the cover page of the prospectus, a post-effective
amendment will be filed to set forth the terms of such offering.
To file an application for the purpose of determining the
eligibility of the trustee to act under subsection (a) of
Section 310 of the Trust Indenture Act in accordance
with the rules and regulations prescribed by the Commission
under Section 305(b)(2) of the Trust Indenture Act.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the Registrant pursuant to
the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer
or controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the
opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933
and will be governed by the final adjudication of such issue.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on
Form S-3
and has duly caused this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the
City of San Francisco, State of California, on this 9th day
of November, 2009.
Thomas Weisel Partners Group, Inc.
Name: Thomas W. Weisel
|
|
|
|
Title:
|
Chairman and Chief Executive Officer
|
POWER OF
ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below hereby constitutes and appoints Thomas
W. Weisel, Lionel F. Conacher, Ryan Stroub and Mark P. Fisher,
and each of them acting individually, as his true and lawful
attorneys-in-fact and agents, each with full power of
substitution, for the undersigned in any and all capacities, to
sign any and all amendments to this Registration Statement
(including post-effective amendments or any abbreviated
registration statement and any amendments thereto filed pursuant
to Rule 462(b) increasing the number of securities for
which registration is sought), and to file the same, with all
exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, with full power of each to act
alone, full power and authority to do and perform each and every
act and thing requisite and necessary to be done in connection
therewith, as fully for all intents and purposes as the
undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or his or
their substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following
persons in the capacities and on the dates indicated:
|
|
|
|
|
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
/s/ Thomas
W. Weisel
Thomas
W. Weisel
|
|
Director, Chairman and Chief Executive Officer (principal
executive officer)
|
|
November 9, 2009
|
|
|
|
|
|
/s/ Ryan
Stroub
Ryan
Stroub
|
|
Chief Financial Officer (principal financial and accounting
officer)
|
|
November 9, 2009
|
|
|
|
|
|
/s/ Thomas
I.A. Allen
Thomas
I.A. Allen
|
|
Director
|
|
November 9, 2009
|
|
|
|
|
|
/s/ Matthew
R. Barger
Matthew
R. Barger
|
|
Director
|
|
November 9, 2009
|
|
|
|
|
|
/s/ Michael
W. Brown
Michael
W. Brown
|
|
Director
|
|
November 9, 2009
|
II-5
|
|
|
|
|
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
/s/ Robert
E. Grady
Robert
E. Grady
|
|
Director
|
|
November 9, 2009
|
|
|
|
|
|
/s/ B.
Kipling Hagopian
B.
Kipling Hagopian
|
|
Director
|
|
November 9, 2009
|
|
|
|
|
|
/s/ Alton
F. Irby III
Alton
F. Irby III
|
|
Director
|
|
November 9, 2009
|
|
|
|
|
|
/s/ Timothy
A. Koogle
Timothy
A. Koogle
|
|
Director
|
|
November 9, 2009
|
II-6
INDEX TO
EXHIBITS
|
|
|
|
|
Exhibit
|
|
|
No.
|
|
Description
|
|
|
1
|
.1
|
|
Form of Underwriting Agreement for Preferred Stock, Common
Stock, Warrants and Units
|
|
1
|
.2
|
|
Form of Underwriting Agreement for Debt Securities
|
|
4
|
.1
|
|
Certificate of Incorporation (incorporated by reference to
Exhibit 3.1 of the Companys Registration Statement on
Form S-1,
File
No. 333-129108)
|
|
4
|
.2
|
|
By-Laws (incorporated by reference to Exhibit 3.2 of the
Companys Registration Statement on
Form S-1,
File
No. 333-129108)
|
|
4
|
.3
|
|
Certificate of Designations, Preferences and Rights of the
Special Voting Preferred Stock of the Company (incorporated by
reference to Exhibit 3.3 of the Companys Current
Report on
Form 8-K
filed January 3, 2008, File
No. 000-51730)
|
|
4
|
.4
|
|
Form of Certificate of Designations
|
|
4
|
.5
|
|
Form of Senior Indenture between the Company and The Bank of New
York Mellon Trust Company N.A., as Trustee thereunder
|
|
4
|
.6
|
|
Form of Subordinated Indenture between the Company and The Bank
of New York Mellon Trust Company N.A., as Trustee thereunder
|
|
4
|
.7
|
|
Form of Warrant Agreement
|
|
4
|
.8(1)
|
|
Form of Unit Agreement
|
|
5
|
.1
|
|
Opinion and Consent of Sullivan & Cromwell LLP
|
|
12
|
.1
|
|
Computation of Ratio of Earnings to Fixed Charges
|
|
23
|
.1
|
|
Consent of Deloitte & Touche LLP, Independent
Registered Public Accounting Firm
|
|
23
|
.2
|
|
Consent of Sullivan & Cromwell LLP (contained in
Exhibit 5.1)
|
|
24
|
|
|
Powers of Attorney (included on the signature pages hereto)
|
|
25
|
.1
|
|
Form T-1
Statement of Eligibility under the Trust Indenture Act of
1939 of The Bank of New York Mellon Trust Company N.A., as
Trustee under the Senior Indenture
|
|
25
|
.2
|
|
Form T-1
Statement of Eligibility under the Trust Indenture Act of
1939 of The Bank of New York Mellon Trust Company N.A., as
Trustee under the Subordinated Indenture
|
|
|
|
(1)
|
|
A form of Unit Agreement, if any, to be filed by amendment or as
an exhibit to a document to be incorporated by reference herein
in connection with an offering of the offered securities.
|
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