EX-4.1






Exhibit 4.1




INVESTOR RIGHTS AGREEMENT




     THIS INVESTOR RIGHTS AGREEMENT (the “Agreement”) is entered into as of June 2, 2008,
by and among MarketAxess Holdings Inc., a Delaware corporation (including its successors and
permitted assigns, the “Company”), TCV VI, L.P., a Delaware limited partnership (“TCV
VI”), and TCV Member Fund, L.P., a Delaware limited partnership (“TCV Member Fund” and,
together with TCV VI, the “Investors”). Capitalized terms used but not defined elsewhere
herein are defined in Section 1.



RECITALS




     1. The Company has entered into a Securities Purchase Agreement, dated as of the date hereof
(as amended from time to time, the “Purchase Agreement”), with each of the Investors
pursuant to which the Company has sold to the Investors, and the Investors have purchased from the
Company, (i) an aggregate of 35,000 shares of the Series B Preferred Stock, which is convertible
into shares of the Company’s voting common stock, par value $0.003 per share (“Common
Stock”), and (ii) warrants to purchase an aggregate of 700,000 shares of Common Stock (the
“Warrants”).



     2. As a condition to each of the Investors’ obligations under the Purchase Agreement, the
Company and the Investors will enter into this Agreement for the purpose of granting certain
registration and other rights to the Investors, as well as imposing certain restrictions on the
ability of the Investors to Transfer their Securities and engage in certain other activities.



     NOW, THEREFORE, in consideration of the covenants and promises set forth herein, and for other
good and valuable consideration, intending to be legally bound hereby the parties agree as follows:



     SECTION 1. Certain Definitions. As used in this Agreement, the capitalized terms
identified in the Preamble and the Recitals shall have the meanings identified therein and the
following terms shall have the following respective meanings:



          “Agreement” shall have the meaning set forth in the Preamble hereof.



          “Commission” shall mean the Securities and Exchange Commission or any other federal
agency at the time administering the Securities Act or the Exchange Act.



          “Common Stock” shall have the meaning set forth in the Recitals hereof.



          “Company” shall have the meaning set forth in the Preamble hereof.



          “Company Indemnified Parties” shall have the meaning set forth in Section 10(a)
hereof.



          “Competitor” means any of the persons set forth on Exhibit A attached hereto.



 









 





          “Effectiveness Period” shall have the meaning set forth in Section 5(b) hereof.



          “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, or any
similar successor federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect from time to time.



          “Holder” shall mean (i) any Investor holding Registrable Securities and (ii) any
member of general or limited partner of an Investor or other person to whom the rights under this
Agreement have been transferred in accordance with Section 13 hereof.



          “Holder Indemnified Parties” shall have the meaning set forth in Section 10(b) hereof.



          “Indemnified Party” shall have the meaning set forth in Section 10(c) hereof.



          “Indemnifying Party” shall have the meaning set forth in Section 10(c) hereof.



          “Investors” shall have the meaning set forth in the Preamble hereof.



          “Lockup Period” shall have the meaning set forth in Section 2 hereof.



          “person” means an individual, corporation, partnership, limited liability company,
joint venture, association, trust, unincorporated organization, other legal entity, or any
government or governmental agency or authority.



          “Purchase Agreement” shall have the meaning set forth in the Recitals hereof.



          “register,” “registered” and “registration” refer to a registration
effected by preparing and filing a registration statement in compliance with the Securities Act,
and the declaration or ordering of the effectiveness of such registration statement.



          “Registration Expenses” shall mean all expenses incurred by the Company in complying
with Sections 5 and 6 hereof, including, without limitation, all registration, qualification,
listing and filing fees, printing expenses, escrow fees, fees and disbursements of counsel for the
Company, blue sky fees and expenses, and the expense of any special audits incident to or required
by any such registration, provided, however, that Registration Expenses shall not be deemed to
include any Selling Expenses.



          “Registrable Securities” shall mean (i) any shares of Common Stock paid as a dividend
on any shares of Series B Preferred Stock or issuable upon conversion of any share of Series B
Preferred Stock, (ii) any shares of Common Stock issuable upon exercise of the Warrants, and (iii)
any Common Stock or other securities issued or issuable in respect of the securities described in
clauses (i) and (ii) above, or this clause (iii) upon any stock split, stock dividend,
recapitalization, reclassification, merger, consolidation or similar event; provided, however, that
such securities shall only be treated as Registrable Securities until the earliest of: (w) the
date on which such security has been registered under the Securities Act and disposed of
in accordance with an effective Registration Statement relating thereto; (x) the date on which
such security has been sold pursuant to Rule 144 and the security is no longer a Restricted



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Security; (y) the date on which all Registrable Securities owned by the Holder thereof may be
resold without volume or other restrictions during any and all three-month periods pursuant to Rule
144; or (z) the date on which such security is transferred in a transaction pursuant to which the
registration rights are not also assigned in accordance with Section 13 hereof.



          “Resale Shelf Registration” shall have the meaning set forth in Section 5(a) hereof.



          “Restricted Affiliate” means: (a) any person who is directly or indirectly
responsible for the formation, management, operations, oversight or administration of the
Purchasers (including, without limitation, any principals, partners or employees of any such
person); and (b) any investment fund directly or indirectly formed, managed or controlled by any
one or more persons referred to in the preceding clause (a).



          “Restricted Securities” shall mean the Securities required to bear the first legend
set forth in Section 3 hereof.



          “Rule 144” shall mean Rule 144 promulgated under the Securities Act and any successor
provision.



          “Securities” shall mean all shares of Series B Preferred Stock purchased by the
Investors pursuant to the Purchase Agreement, all shares of Series B Preferred Stock issued to the
Investors as dividends, the Warrants, all shares of Common Stock issuable upon conversion of the
Series B Preferred Stock or upon exercise of the Warrants and all shares of Common Stock issued or
issuable in respect of any of the foregoing.



          “Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder or any similar federal statute and the rules and regulations of
the Commission thereunder, all as the same shall be in effect at the time.



          “Selling Expenses” shall mean all underwriting discounts, selling commissions and
stock transfer taxes applicable to the securities registered by the Holders.



          “Series B Preferred Stock” shall mean the Company’s Series B Preferred Stock, par
value $0.001 per share.



          “Shelf Registration” shall mean the Resale Shelf Registration or a Subsequent Shelf
Registration, as applicable.



          “Subsequent Holder Notice” shall have the meaning set forth in Section 5(e) hereof.



          “Subsequent Shelf Registration” shall have the meaning set forth in Section 5(c)
hereof.



          “TCV VI” shall have the meaning set forth in the Preamble hereof.



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          “TCV Member Fund” shall have the meaning set forth in the Preamble hereof.



          “Transfer” shall mean any, direct or indirect, pledge, sale, contract to sell,
assignment, transfer or other encumbrance or disposition.



          “Underwritten Offering” shall have the meaning set forth in Section 5(f) hereof.



          “Underwritten Offering Notice” shall have the meaning set forth in Section 5(f)
hereof.



          “Warrants” shall have the meaning set forth in the Recitals hereof.



     SECTION 2. Transfer Restrictions.



     (a) From the date hereof until the first anniversary of this Agreement (such period being the
“Lockup Period”) the Investors shall not Transfer any Securities without the prior written
consent of the Company; provided, that in the event the Board of Directors shall (i)
approve a tender offer for a majority of the outstanding capital stock of the Company or (ii)
approve a merger or consolidation of the Company with any other person that would result in the
voting securities of the Company outstanding immediately prior thereto representing less than a
majority of the voting power to elect a majority of the board of directors or similar body of the
person surviving such merger or resulting from such consolidation, then the Investors shall be
permitted to tender shares of Common Stock into such tender offer or deliver shares of Common Stock
in connection with the consummation of such merger.



     (b) At no time, without the prior written consent of the Company, will the Investors Transfer
(i) any of the Series B Preferred Stock or Warrants to any Competitor
or (ii) any of the Common Stock issuable upon conversion of the
Series B Preferred Stock or upon exercise of the Warrants to any Competitor in a privately negotiated
transaction. The Investors will not knowingly
participate in a series of privately negotiated transactions which results in the Transfer
of any Securities to any Competitor. In addition, no shares of
Series B Preferred Stock or Warrants may be
Transferred, unless the Transferee agrees
to be bound by the terms of this Section 2(b).



     (c) In any event, Restricted Securities shall not be Transferred except upon the conditions
specified in Section 4, which conditions are intended to ensure compliance with the provisions of
the Securities Act. Any attempted Transfer in violation of this Section 2 shall be void ab initio.



     SECTION 3. Restrictive Legend. Each certificate representing the Securities (unless
otherwise permitted by the provisions of Section 4 below) shall be stamped or otherwise imprinted
with a legend in the following form (in addition to any legend required under applicable state
securities laws):




“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT
WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR



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DISTRIBUTION THEREOF. SUCH
SHARES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT THEREUNDER OR AN EXEMPTION FROM SUCH
REGISTRATION.”



          In addition, for so long as the Securities are subject to the restrictions set forth in
Section 2, each certificate representing the Securities shall be stamped or otherwise imprinted
with a legend in the following form:





“THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON
TRANSFER SET FORTH IN AN INVESTOR RIGHTS AGREEMENT. THE COMPANY WILL MAIL TO THE
HOLDER OF THIS CERTIFICATE A COPY OF SUCH INVESTOR RIGHTS AGREEMENT, AS IN EFFECT ON
THE DATE OF MAILING, WITHOUT CHARGE, PROMPTLY AFTER RECEIPT OF A WRITTEN REQUEST
THEREFOR.”



          Each Investor consents to the Company making a notation on its records and giving instructions
to any transfer agent of the Restricted Securities in order to implement the restrictions on
transfer set forth in Section 2.




     SECTION 4. Notice of Proposed Transfers. Each Holder shall comply in all respects
with the provisions of this Section 4. Prior to any proposed Transfer of any Restricted
Securities, unless there is in effect a registration statement under the Securities Act covering
the proposed Transfer, a Holder shall give written notice to the Company of such Holder’s intention
to effect such Transfer. Each such notice shall describe the manner and circumstances of the
proposed Transfer in sufficient detail, and shall be accompanied by either (a) an opinion of legal
counsel reasonably satisfactory to the Company to the effect that the proposed Transfer of the
Restricted Securities may be effected without registration under the Securities Act, (b) a “no
action” letter from the Commission to the effect that the Transfer of such securities without
registration will not result in a recommendation by the staff of the Commission that action be
taken with respect thereto or (c) any other evidence reasonably satisfactory to counsel to the
Company, whereupon such Investor shall be entitled to Transfer such Restricted Securities in
accordance with the terms of the notice delivered by such Investor to the Company. Notwithstanding
the foregoing, in the event a Holder shall give the Company a representation letter containing such
representations as the Company shall reasonably request, the Company will not require such a notice
or legal opinion or “no action” letter or such other evidence (x) in any transaction in compliance
with Rule 144, (y) in any transaction in which a Holder that is a corporation distributes
Restricted Securities solely to its majority owned subsidiaries or Affiliates for no consideration
or (z) in any transaction in which a Holder that is a partnership or limited liability company
distributes Restricted Securities solely to its Affiliates (including affiliated fund
partnerships), or partners or members of such Holder or
its Affiliates for no consideration (and to the extent the Securities will be Restricted
Securities when held by such transferees they agree to be bound by the terms of this Agreement).
Each certificate evidencing the Restricted Securities transferred shall bear the appropriate
restrictive legend set forth in Section 3 above, except that such certificate shall not bear the
first such restrictive legend if such legend is not required in order to establish compliance with
any provisions of the Securities Act. Upon the request of a Holder of a



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certificate bearing the
first such restrictive legend and, if necessary, the appropriate evidence as required by clause
(a), (b) or (c) of the third sentence of this Section 4, the Company shall remove the first such
restrictive legend from such certificate and from the certificate to be issued to the applicable
transferee if such legend is not required in order to establish compliance with any provisions of
the Securities Act and the Holder promptly Transfers the Security. Upon the request of a Holder of
a certificate bearing the second restrictive legend, the Company shall remove such restrictive
legend from such certificate when the provisions of Section 2 are no longer applicable to such
Security.



     SECTION 5. Resale Shelf Registration.



          (a) The Company shall use its best efforts to file within six months of the date hereof a
registration statement covering the sale or distribution from time to time by the Holders, on a
delayed or continuous basis pursuant to Rule 415 of the Securities Act, including without
limitation, by way of underwritten offering, block sale or other distribution plan designated by
the Holders of a majority of the Registrable Securities, of all of the Registrable Securities on
Form S-3 (except if the Company is not then eligible to register for resale the Registrable
Securities on Form S-3, then such registration shall be on another appropriate form and shall
provide for the registration of such Registrable Securities for resale by such Holders in
accordance with any reasonable method of distribution elected by the Holders) (the “Resale
Shelf Registration Statement”) and shall use its best efforts to cause such Resale Shelf
Registration to be declared effective by the Commission as promptly as possible after the filing
thereof, but in any event prior to the twelve month anniversary of the date of this Agreement.



          (b) Once declared effective, the Company shall, subject to Section 9(j), use its best efforts
to cause the Resale Shelf Registration to be continuously effective and usable until such time as
there are no longer any Registrable Securities
(the “Effectiveness Period”).



          (c) If any Shelf Registration ceases to be effective under the Securities Act for any reason
at any time during the Effectiveness Period, the Company shall use its commercially reasonable
efforts to promptly cause such Shelf Registration to again become effective under the Securities
Act (including obtaining the prompt withdrawal of any order suspending the effectiveness of such
Shelf Registration), and in any event shall within 30 days of such cessation of effectiveness,
amend such Shelf Registration in a manner reasonably expected to obtain the withdrawal of any order
suspending the effectiveness of such Shelf Registration or, file an additional registration
statement (a “Subsequent Shelf Registration”) for an offering to be made on a delayed or
continuous basis pursuant to Rule 415 of the Securities Act registering the resale from time to
time by Holders thereof of all securities that are Registrable Securities as of the time of such
filing. If a Subsequent Shelf Registration is filed, the Company shall use its commercially
reasonable efforts to (x) cause such Subsequent Shelf Registration to become effective under the
Securities Act as promptly as is reasonably practicable after such filing, but in
no event later than the date that is 90 days after such Subsequent Shelf Registration is filed
and (y) keep such Subsequent Shelf Registration (or another Subsequent Shelf Registration)
continuously effective until the end of the Effectiveness Period. Any such Subsequent Shelf
Registration shall be a Registration Statement on Form S-3 to the extent that the Company is
eligible to use such form. Otherwise, such Subsequent Shelf Registration shall be on another



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appropriate form and shall provide for the registration of such Registrable Securities for resale
by such Holders in accordance with any reasonable method of distribution elected by the Holders.



          (d) The Company shall supplement and amend any Shelf Registration if required by the rules,
regulations or instructions applicable to the registration form used by the Company for such Shelf
Registration if required by the Securities Act or as reasonably requested by the Holders covered by
such Shelf Registration.



          (e) If a person becomes a Holder of Registrable Securities after a Shelf Registration becomes
effective under the Securities Act, the Company shall, as promptly as is reasonably practicable
following delivery of written notice to the Company of such person becoming a Holder and requesting
for its name to be included as a selling securityholder in the prospectus related to the Shelf
Registration (a “Subsequent Holder Notice”), and in any event within 15 days after such
date:



               (i) if required and permitted by applicable law, file with the Commission a supplement to the
related prospectus or a post-effective amendment to the Shelf Registration and any necessary
supplement or amendment to any document incorporated therein by reference and file any other
required document with the Commission so that such Holder is named as a selling securityholder in
the Shelf Registration and the related prospectus in such a manner as to permit such Holder to
deliver a prospectus to purchasers of the Registrable Securities in accordance with applicable law;
provided, however, that if a post-effective amendment is required by the rules and regulations of
the Commission in order to permit resales by such Holder, the Company shall not be required to file
more than one post-effective amendment or a supplement to the related prospectus for such purpose
in any 45-day period;



               (ii) if, pursuant to Section 5(e)(i), the Company shall have filed a post-effective amendment
to the Shelf Registration, use its efforts to cause such post-effective amendment to become
effective under the Securities Act as promptly as is reasonably practicable, but in any event by
the date that is 60 days after the date such post-effective amendment is required by this
Section 5(e) to be filed; and



               (iii) notify such Holder as promptly as is reasonably practicable after the effectiveness
under the Securities Act of any post-effective amendment filed pursuant to clause (i) above.



          (f) The Holders of a majority of the Registrable Securities may on one occasion after the
Resale Shelf Registration Statement becomes effective deliver a written notice to the Company (the
“Underwritten Offering Notice”) specifying that the sale of some or all of the Registrable
Securities subject to the Shelf Registration, not to be less than 1,000,000 shares of Registrable
Securities, is intended to be conducted through an underwritten offering (the “Underwritten
Offering”). In the event of an Underwritten Offering:



               (i) The Holders of a majority of Registrable Securities to be included in such Underwritten
Offering shall have the right to select the managing underwriter or underwriters to administer the
offering; provided, however, that such managing underwriter or underwriters shall be reasonably
acceptable to the Company.



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               (ii) The Holders of Registrable Securities to be included in such Underwritten Offering and
the Company shall enter into an underwriting agreement in such customary form as shall have been
negotiated and agreed to by the Company with the underwriter or underwriters selected for such
underwriting.



               (iii) Notwithstanding any other provision of this Section 5, if the managing underwriter or
underwriters of a proposed Underwritten Offering advises the Board of Directors of the Company that
in its or their opinion the number of Registrable Securities requested to be included in such
Underwritten Offering exceeds the number which can be sold in such Underwritten Offering in light
of market conditions, the Registrable Securities shall be included on a pro rata basis upon the
number of securities that each Holder shall have requested to be included in such offering. To
facilitate the allocation of shares in accordance with the above provisions, the Company or the
managing underwriters may round the number of shares allocated to any Holder or other holder to the
nearest 100 shares. If any Holder disapproves of the terms of any such underwriting, such Holder
may elect to withdraw therefrom by written notice to the Company and the managing underwriter or
underwriters.



          (g) In the event any Holder requests to participate in a Shelf Registration pursuant to this
Section 5 in connection with a distribution of Registrable Securities to its partners or members,
the Shelf Registration shall in the event such distribution and subsequent resale is permitted by
applicable law provide for resale by such partners or members, if requested by such Holder.



     SECTION 6. Company Registration.



          (a) Notice of Registration. If at any time or from time to time the Company shall
determine to file a registration statement for an underwritten public offering of its equity
securities (for the avoidance of doubt, the following will not apply to any registration
statement filed on a Form S-4, Form S-8 or any successor forms), the Company will:



               (i) promptly give to each Holder written notice thereof; and



               (ii) subject to Section 6(b) below, include in such registration and underwritten offering
(and any related qualification under blue sky laws or other compliance) all the Registrable
Securities specified in a written request or requests made within 10 days after receipt of such
written notice from the Company by any Holder.



          (b) Underwriting. The right of any Holder to registration pursuant to this Section 6 shall be conditioned
upon such Holder’s participation in such underwriting and the inclusion of Registrable Securities
in the underwriting to the extent provided herein. Each Holder proposing to distribute its
securities through such underwriting shall (together with the Company and the other holders
distributing their securities through such underwriting) enter into and perform such Holder’s
obligations under an underwriting agreement with the managing underwriter selected for such
underwriting by the Company or by the stockholders of the Company who have the right to select the
underwriters (such underwriting agreement to be in the form negotiated by the Company or such
stockholders, as the case may be). Notwithstanding any other provision of this Section 6, if the
managing underwriter or underwriters of a proposed



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underwritten offering with respect to which
Holders of Registrable Securities have exercised their piggyback registration rights advise the
Board of Directors of the Company that in its or their opinion the number of Registrable Securities
requested to be included in the offering thereby and all other securities proposed to be sold in
the offering exceeds the number which can be sold in such underwritten offering in light of market
conditions, the Registrable Securities and such other securities to be included in such underwritten
offering shall be allocated, (i) first, (x) in the event such offering was initiated by the
Company, up to the total number of securities that the Company has requested to be included in such
registration and (y) in the event such offering was initiated by the holders of securities (other
than the Holders) who have exercised their demand registration rights, up to the total number of
securities that such holders of such securities have requested to be included in such offering,
(ii) second, and only if all the securities referred to in clause (i) have been included, up to the
total number of securities that the Holders and other holders of securities that have contractual
rights to be included in such registration have requested to be included in such offering (pro rata
based upon the number of securities that each of them shall have requested to be included in such
offering) and (iii) third, and only if all the securities referred to in clause (ii) have been
included, all other securities proposed to be included in such offering that, in the opinion of the
managing underwriter or underwriters can be sold without having such adverse effect. To facilitate
the allocation of shares in accordance with the above provisions, the Company or the managing
underwriters may round the number of shares allocated to any Holder or other holder to the nearest
100 shares. If any Holder disapproves of the terms of any such underwriting, such Holder may elect
to withdraw therefrom by written notice to the Company and the managing underwriter or
underwriters. Any securities excluded or withdrawn from such underwriting shall be withdrawn from
such registration.



          (c) Right to Terminate Registration. The Company or the holders of securities who
have caused a registration statement to be filed as contemplated by this Section 6, as the case may
be, shall have the right to have any registration initiated by it or them under this Section 6
terminated or withdrawn prior to the effectiveness thereof, whether or not any Holder has elected
to include securities in such registration.



     SECTION 7. Limitations on Subsequent Registration Rights. From and after the date
hereof, the Company shall not enter into any agreement granting any holder or prospective holder of
any securities of the Company registration rights with respect to such securities that conflict
with the rights granted to the Holders herein, without
the consent of Holders of at least a majority of the Registrable Securities. It is agreed
that the granting of pro rata registration rights to any other investor in the Company shall not be
considered to conflict with the rights granted to the Holders herein.



     SECTION 8. Expenses of Registration. All Registration Expenses incurred in connection
with any registration pursuant to Sections 5 and 6 shall be borne by the Company. All Selling
Expenses relating to securities registered on behalf of the Holders shall be borne by the Holders
of the registered securities included in such registration pro rata on the basis of the number of
shares so registered, except that the Company will pay the reasonable fees and expenses (not to
exceed $25,000 in the aggregate) of one counsel to the Holders in connection with the exercise by
the Holders of the registration rights pursuant to Sections 5 and 6.



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     SECTION 9. Registration Procedures. In the case of each registration effected by the
Company pursuant to Sections 5 and 6, the Company will keep each Holder participating in such
registration reasonably informed as to the status thereof and, at its expense, the Company will:



          (a) prepare and file with the Commission a registration statement with respect to such
securities in accordance with the applicable provisions of this Agreement;



          (b) prepare and file with the Commission such amendments, including post-effective amendments,
and supplements to such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the Securities Act
with respect to the disposition of all securities covered by such registration statement and as may
be necessary to keep the registration statement continuously effective for the period set forth in
this Agreement;



          (c) furnish to the Holders participating in such registration and to their legal counsel
copies of the registration statement proposed to be filed, and provide such Holders and their legal
counsel the reasonable opportunity to review and comment on such registration statement;



          (d) furnish to the Holders participating in such registration and to the underwriters of the
securities being registered such reasonable number of copies of the registration statement,
preliminary prospectus, final prospectus and such other documents as such underwriters may
reasonably request in order to facilitate the public offering of such securities;



          (e) use reasonable efforts to notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is required to be delivered
under the Securities Act of the Company’s knowledge of the happening of any event as a result of
which the prospectus included in such registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or incomplete in the light of the
circumstances then existing, and, subject to Section 9(j), at the request of any such
Holder, prepare promptly and furnish to such Holder a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchaser of such shares, such prospectus shall not include an untrue statement of
a material fact or omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading or incomplete in the light of the circumstances then
existing;



          (f) use reasonable efforts to register and qualify the securities covered by such registration
statement under such other securities or blue sky laws of such jurisdictions as shall be reasonably
requested by the Holders, provided, however, that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions;



          (g) make available for inspection by any Holder participating in such registration, any
underwriter participating in any disposition pursuant to such registration, and



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any attorney or
accountant retained by any such Holder or underwriter, all relevant financial and other records,
pertinent corporate documents and properties of the Company, and cause the Company’s officers and
directors to supply all information reasonably requested by any such Holder, underwriter, attorney
or accountant in connection with such registration statement;



          (h) in the event that the Registrable Securities are being offered in an underwritten public
offering, enter into and perform its obligations under an underwriting agreement in accordance with
the applicable provisions of this Agreement and participate and cooperate with the underwriters in
connection with any road show or marketing activities customary for an underwritten public
offering;



          (i) use reasonable efforts to furnish, on the date that such Registrable Securities are
delivered to the underwriters for sale, if such securities are being sold through underwriters, (i)
an opinion, dated as of such date, of the legal counsel representing the Company for the purposes
of such registration, in form and substance as is customarily given to underwriters in an
underwritten public offering, addressed to the underwriters, if any, and (ii) a letter dated as of
such date, from the independent certified public accountants of the Company, in form and substance
as is customarily given by independent certified public accountants to underwriters in an
underwritten public offering, addressed to the underwriters; and



          (j) notwithstanding any other provision of this Agreement, if the Board of Directors of the
Company has determined in good faith that the disclosure necessary for continued use of the
prospectus and registration statement by the Holders could be materially detrimental to the
Company, the Company shall have the right not to file or not to cause the effectiveness of any
registration covering any Registrable Securities and to suspend the use of the prospectus and the
registration statement covering any Registrable Security for such period of time as its use would
be materially detrimental to the Company by delivering written notice of such suspension to all
Holders listed on the Company’s records; provided, however, that in any 12-month period the Company
may exercise the right to such suspension not more than twice and for not more than an aggregate of
120 days. From and after the date of a notice of suspension under this Section 9(j), each Holder
agrees not to use the prospectus or registration
statement until the earlier of (1) notice from the Company that such suspension has been
lifted or (2) the day following the 90th day of suspension within any 12-month period.



     SECTION 10. Indemnification.



          (a) The Company will, with respect to any Registrable Securities as to which registration or
qualification or compliance under applicable “blue sky” laws has been effected pursuant to this
Agreement, indemnify each Holder, each Holder’s current and former officers, directors, partners
and members, and each person controlling such Holder within the meaning of Section 15 of the
Securities Act, and each underwriter thereof, if any, and each person who controls any such
underwriter within the meaning of Section 15 of the Securities Act (collectively, the “Company
Indemnified Parties”), against all expenses, claims, losses, damages and liabilities, joint or
several, (or actions in respect thereof) arising out of or based on any untrue statement (or
alleged untrue statement) of a material fact contained in any registration statement, prospectus,
preliminary prospectus, offering circular or other document, or any amendment or supplement thereto
incident to any such registration, qualification or compliance



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or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were made, not misleading, or any
violation by the Company of any rule or regulation promulgated under the Securities Act, Exchange
Act or state securities laws applicable to the Company in connection with any such registration,
and the Company will reimburse each of the Company Indemnified Parties for any reasonable legal and
any other expenses reasonably incurred in connection with investigating, preparing or defending any
such claim, loss, damage, liability or action, as such expenses are incurred. The indemnity
agreement contained in this Section 10(a) shall not apply to amounts paid in settlement of any
loss, claim, damage, liability or action if such settlement is effected without the consent of the
Company (which consent shall not be unreasonably withheld or delayed), nor shall the Company be
liable to a Holder in any such case for any such loss, claim, damage, liability or action (1) to
the extent that it arises out of or is based upon a violation or alleged violation of any state or
federal law (including any claim arising out of or based on any untrue statement or alleged untrue
statement or omission or alleged omission in the registration statement or prospectus) which occurs
in reliance upon and in conformity with written information furnished expressly for use in
connection with such registration by or on behalf of such Holder or (2) in the case of a sale
directly by a Holder of Registrable Securities (including a sale of such Registrable Securities
through any underwriter retained by such Holder engaging in a distribution solely on behalf of such
Holder), such untrue statement or alleged untrue statement or omission or alleged omission was
corrected in a final or amended prospectus, and such Holder failed to deliver a copy of the final
or amended prospectus at or prior to the confirmation of the sale of the Registrable Securities to
the person asserting any such loss, claim, damage or liability in any case in which such delivery
is required by the Securities Act.



          (b) Each Holder will, if Registrable Securities held by such Holder are included in the
securities as to which such registration or qualification or compliance under applicable “blue sky”
laws is being effected, indemnify, severally and not jointly, the Company, each of its directors,
officers, partners and members, each underwriter, if any, of the Company’s
securities covered by such a registration, each person who controls the Company or such
underwriter within the meaning of Section 15 of the Securities Act, and each other Holder and each
of such Holder’s officers, directors, partners and members and each person controlling such Holder
within the meaning of Section 15 of the Securities Act (collectively, the “Holder Indemnified
Parties”), against all expenses, claims, losses, damages and liabilities (or actions in respect
thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a
material fact contained in any registration statement, prospectus, preliminary prospectus, offering
circular or other document, or any amendment or supplement thereto incident to any such
registration, qualification or compliance or based on any omission (or alleged omission) to state
therein a material fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances in which they were made, not misleading, or any violation by such
Holder of any rule or regulation promulgated under the Securities Act, Exchange Act or state
securities law applicable to such Holder, and will reimburse each of the Holder Indemnified Parties
for any reasonable legal or any other expenses reasonably incurred in connection with
investigating, preparing or defending any such claim, loss, damage, liability or action, as such
expenses are incurred, in each case to the extent, but only to the extent, that such untrue
statement (or alleged untrue statement) or omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document in reliance upon and in



12









 







conformity with written information furnished to the Company by such Holder and stated to be
specifically for use therein, provided, however, that in no event shall any indemnity under this
Section 10(b) payable by a Holder exceed the amount by which the net proceeds actually received by
such Holder from the sale of Registrable Securities included in such registration exceeds the
amount of any other losses, expenses, settlements, damages, claims and liabilities that such Holder
has been required to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission or violation. The indemnity agreement contained in this Section 10(b) shall not
apply to amounts paid in settlement of any loss, claim, damage, liability or action if such
settlement is effected without the consent of the applicable Holder (which consent shall not be
unreasonably withheld or delayed), nor shall the Holder be liable for any such loss, claim, damage,
liability or action where such untrue statement or alleged untrue statement or omission or alleged
omission was corrected in a final or amended prospectus, and the Company or the underwriters failed
to deliver a copy of the final or amended prospectus at or prior to the confirmation of the sale of
the Registrable Securities to the person asserting any such loss, claim, damage or liability in any
case in which such delivery is required by the Securities Act



          (c) Each party entitled to indemnification under this Section 10 (the “Indemnified
Party”) shall give notice to the party required to provide indemnification (the
“Indemnifying Party”) promptly after such Indemnified Party has actual knowledge of any
claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the
defense of any such claim or any litigation resulting therefrom, provided, however, that counsel
for the Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be
approved by the Indemnified Party (whose approval shall not unreasonably be withheld or delayed),
and the Indemnified Party may participate in such defense at such party’s expense; provided,
further, however, that an Indemnified Party (together with all other Indemnified Parties which may
be represented without conflict by one counsel) shall have the right to retain one separate
counsel, with the reasonable fees and expenses to be paid by the Indemnifying Party, if
representation of such Indemnified Party by the counsel retained by the Indemnifying Party would be
inappropriate due to conflicting interests between such Indemnified Party and any
other party represented by such counsel in such proceeding. The failure of any Indemnified
Party to give notice as provided herein shall relieve the Indemnifying Party of its obligations
under this Section 10, only to the extent that, the failure to give such notice is materially
prejudicial or harmful to an Indemnifying Party’s ability to defend such action. No Indemnifying
Party, in the defense of any such claim or litigation, shall, except with the consent of each
Indemnified Party (which consent shall not be unreasonably withheld or delayed), consent to entry
of any judgment or enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all
liability in respect to such claim or litigation. The indemnity agreements contained in this
Section 10 shall not apply to amounts paid in settlement of any loss, claim, damage, liability or
action if such settlement is effected without the consent of the Indemnifying Party, which consent
shall not be unreasonably withheld or delayed. The indemnification set forth in this Section 10
shall be in addition to any other indemnification rights or agreements that an Indemnified Party
may have.



          (d) If the indemnification provided for in this Section 10 is held by a court of competent
jurisdiction to be unavailable to an Indemnified Party, other than pursuant to its terms, with
respect to any claim, loss, damage, liability or action referred to therein, then, subject to the



13









 







limitations contained in Section 10(e), the Indemnifying Party, in lieu of indemnifying such
Indemnified Party hereunder, shall contribute to the amount paid or payable by such Indemnified
Party as a result of such claim, loss, damage, liability or action in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party on the one hand and the
Indemnified Party on the other in connection with the actions that resulted in such claims, loss,
damage, liability or action, as well as any other relevant equitable considerations. The relative
fault of the Indemnifying Party and of the Indemnified Party shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact related to information supplied by the Indemnifying Party or by
the Indemnified Party and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and the Holders agree
that it would not be just and equitable if contribution pursuant to this Section 10(d) were based
solely upon the number of entities from whom contribution was requested or by any other method of
allocation which does not take account of the equitable considerations referred to above in this
Section 10(d). In no event shall any Holder’s contribution obligation under this Section 10(d)
exceed the amount by which the net proceeds actually received by such Holder from the sale of
Registrable Securities included in such registration exceeds the amount of any other losses,
expenses, settlements, damages, claims and liabilities that such Holder has been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged omission or violation.



          (e) No person guilty of fraudulent misrepresentation (within the meaning of the Securities
Act) shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.



     SECTION 11. Information by Holders, Etc. The Holder or Holders of Registrable
Securities included in any registration shall furnish to the Company such information regarding
such Holder or Holders and their Affiliates,
the Registrable Securities held by them and the distribution proposed by such Holder or
Holders and their Affiliates as the Company may reasonably request in writing and as shall be
required in connection with any registration, qualification or compliance referred to in this
Agreement. It is understood and agreed that the obligations of the Company under Section 5 and
Section 6 are conditioned on the timely provisions of the foregoing information by such Holder or
Holders and, without limitation of the foregoing, will be conditioned on compliance by such Holder
or Holders with the following:



          (a) such Holder or Holders will, and will cause their respective Affiliates to, cooperate with
the Company in connection with the preparation of the applicable registration statement, and for so
long as the Company is obligated to keep such registration statement effective, such Holder or
Holders will and will cause their respective Affiliates to, provide to the Company, in writing and
in a timely manner, for use in such registration statement (and expressly identified in writing as
such), all information regarding themselves and their respective Affiliates and such other
information as may be required by applicable law to enable the Company to prepare such registration
statement and the related prospectus covering the applicable Registrable Securities owned by such
Holder or Holders and to maintain the currency and effectiveness thereof;



14









 





          (b) during such time as such Holder or Holders and their respective Restricted Affiliates may
be engaged in a distribution of the Registrable Securities, such Holder or Holders will, and they
will cause their Restricted Affiliates to, comply with all laws applicable to such distribution,
including Regulation M promulgated under the Exchange Act, and, to the extent required by such
laws, will, and will cause their Restricted Affiliates to, among other things: (i) not engage in
any stabilization activity in connection with the securities of the Company in contravention of
such laws; (ii) distribute the Registrable Securities acquired by it solely in the manner described
in the applicable registration statement; and (iii) if required by applicable law, cause to be
furnished to each agent or broker-dealer to or through whom such Registrable Securities may be
offered, or to the offeree if an offer is made directly by such Holder or Holders or their respective Restricted Affiliates, such copies of
the applicable prospectus (as amended and supplemented to such date) and documents incorporated by
reference therein as may be required by such agent, broker-dealer or offeree, provided, however,
that the Company shall have provided such Holder or Holders with an adequate number of copies
thereof;



          (c) such Holder or Holders shall, and they shall cause their respective Restricted Affiliates to,
permit the Company and its representatives and agents to
examine such documents and records and will supply in a timely manner any information as they may
be reasonably request to provide in connection with the offering or other distribution of
Registrable Securities by such Holder or Holders; and



          (d) on receipt of written notice from the Company of the happening of any of the events
specified in Section 9(j), or that requires the suspension by such Holder or Holders and their
respective Affiliates of the distribution of any of the Registrable Securities owned by such Holder
or Holders, then such Holders shall, and they shall cause their respective Affiliates to, cease
offering or distributing the Registrable Securities owned by such Holder or Holders until the
offering and distribution of the Registrable Securities owned by such Holder or Holders may
recommence in accordance with the terms hereof and applicable law.



     SECTION 12. Rule 144 Reporting. With a view to making available the benefits of
certain rules and regulations of the Commission which may at any time permit the sale of the
Restricted Securities to the public without registration, the Company agrees that, for so long as a
Holder owns Registrable Securities, the Company will use its commercially reasonable efforts to:



          (a) make and keep public information available, as those terms are understood and defined in
Rule 144;



          (b) file with the Commission in a timely manner all reports and other documents required of
the Company under the Securities Act and the Exchange Act; and



          (c) so long as a Holder owns any Restricted Securities, to furnish to the Holder forthwith
upon written request a written statement by the Company as to its compliance with the reporting
requirements of Rule 144, the Securities Act and the Exchange Act, a copy of the most recent annual
or quarterly report of the Company, and such other reports and documents of the Company and other
information in the possession of or reasonably obtainable by the Company as a Holder may reasonably
request in availing itself of any rule or regulation of the Commission allowing a Holder to sell
any such securities without registration.



15









 





     SECTION 13. Transfer of Registration Rights. The rights to cause the Company to
register securities granted to a Holder under this Agreement may be assigned to a transferee or
assignee in connection with any transfer or assignment of Registrable Securities by such party;
provided, however, that (a) such transfer may otherwise be effected in accordance with applicable
securities laws, (b) prior written notice of such assignment is given to the Company, (c) such
transferee or assignee (i) acquires from such Holder at least 700,000 Registrable Securities (as
adjusted for any stock dividends paid in Registrable Securities, and combinations, stock splits,
recapitalizations and the like each with respect to shares of Registrable Securities, (ii) is a
general or limited partner or member of such Holder, (iii) is a member of a limited liability
company that is a general or limited partner or member of such Holder, (iv) is a retired partner of
any of the foregoing, or (v) is a spouse, ancestor, lineal descendant or sibling of any of the
foregoing who acquires Registrable Securities by gift, will or intestate succession, and (d) such
transferee or assignee agrees in writing to be bound by, and subject to, this Agreement as a Holder
pursuant to a written instrument in form and substance reasonably acceptable to the Company. All
shares or Registrable Securities transferred by affiliated persons, shall be aggregated together
for purposes of determining the availability of any rights in this Section 13.



     SECTION 14. Termination of Rights. The rights of any particular Holder to cause the
Company to register securities under Sections 5 and 6 shall terminate with respect to such Holder
upon the date upon which all of such Holder’s shares are no longer Registrable Securities.



     SECTION 15. Miscellaneous.



          15.1. Counterparts. This Agreement may be executed in one or more counterparts, all
of which shall be considered one and the same agreement, and will become effective when one or more
counterparts have been signed by a party and delivered to the other parties. Copies of executed
counterparts transmitted by telecopy, telefax or other electronic transmission service shall be
considered original executed counterparts for purposes of this Section 15.1, provided that receipt
of copies of such counterparts is confirmed.



          15.2. Governing Law; Waiver of Jury Trial.



          (a) This Agreement and any disputes arising hereunder or controversies related hereto shall be
governed by and construed in accordance with the internal laws, and not the laws of conflicts, of
the State of New York that apply to contracts made and performed entirely within such state.



          (b) Waiver of Jury Trial. EACH PARTY HERETO, FOR ITSELF AND ITS AFFILIATES, HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, SUIT OR OTHER PROCEEDING (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO THE ACTIONS OF THE PARTIES HERETO OR THEIR RESPECTIVE
AFFILIATES PURSUANT TO THIS AGREEMENT OR IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR
ENFORCEMENT HEREOF.



16









 





          15.3. Entire Agreement; No Third Party Beneficiary. This Agreement and the Related
Agreements (as defined in the Purchase Agreement) contain the entire agreement by and among the
parties with respect to the subject matter hereof and all prior negotiations, writings and
understandings relating to the subject matter of this Agreement, including the letter of intent
dated May 23, 2008 between the Company and TCV VI, are merged in and are superseded and canceled
by, this Agreement and the Related Agreements (except that the Confidentiality Letter dated May 27,
2008 between the Company and TCMI, Inc shall remain in full force and effect in accordance with its
terms). Except as provided in Section 10, this Agreement is not intended to confer upon any person
not a party hereto (or their successors and permitted assigns) any rights or remedies hereunder.



          15.4. Expenses. Except as provided in Section 8, all fees, costs and expenses
incurred in connection with this Agreement and the transactions contemplated hereby, including
accounting and legal fees shall be paid by the party incurring such expenses.



          15.5. Notices. All notices and other communications hereunder will be in writing and
given by certified or registered mail, return receipt requested, nationally recognized overnight
delivery service, such as Federal Express or facsimile (or like transmission) with confirmation of
transmission by the transmitting equipment or personal delivery against receipt to the party to
whom it is given, in each case, at such party’s address or facsimile number set forth below or such
other address or facsimile number as such party may hereafter specify by notice to the other
parties hereto given in accordance herewith. Any such notice or other
communication shall be deemed to have been given as of the date so personally delivered or
transmitted by facsimile or like transmission, on the next business day when sent by overnight
delivery services or five days after the date so mailed if by certified or registered mail.



          If to the Company, to:


MarketAxess Holdings Inc.

140 Broadway, 42nd Floor

New York, NY 10005

Fax No.: (212) 813-6390

Attention: Chief Executive Officer



with a copy to:

Proskauer Rose LLP

1585 Broadway

New York, NY 10036-8299

Fax No.: (212) 969-2900

Attention: Adam J. Kansler



If to an Investor, to:



Technology Crossover Ventures




17









 







528 Ramona Street

Palo Alto, CA 94301

Fax No.: (650) 614-8222

Attention: Carla S. Newell



with a copy to:



Latham & Watkins LLP

140 Scott Drive

Menlo Park, CA 94025

Fax No.: (650) 463-2600

Attention: Peter Kerman




          15.6. Successors and Assigns. This Agreement will be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted assigns. Any purported
assignment or delegation in violation of this Agreement shall be null and void ab
initio.



          15.7. Headings. The Section, Article and other headings contained in this Agreement
are inserted for convenience of reference only and will not affect the meaning or interpretation of
this Agreement.



          15.8. Amendments and Waivers. This Agreement may not be modified or amended except by
an instrument or instruments in writing signed by the Company and the holders of a majority of the
Registrable Securities outstanding at the time of such amendment. Any party hereto may, only by an
instrument in writing, waive compliance by any other party or
parties hereto with any term or provision hereof on the part of such other party or parties
hereto to be performed or complied with. No failure or delay of any party in exercising any right
or remedy hereunder shall operate as a waiver thereof, nor will any single or partial exercise of
any right or power, or any abandonment or discontinuance of steps to enforce such right or power,
preclude any other or further exercise thereof or the exercise of any other right or power. The
waiver by any party hereto of a breach of any term or provision hereof shall not be construed as a
waiver of any subsequent breach. The rights and remedies of the parties hereunder are cumulative
and are not exclusive of any rights or remedies that they would otherwise have hereunder.



          15.9. Interpretation; Absence of Presumption.



          (a) For the purposes hereof: (i) words in the singular shall be held to include the plural
and vice versa and words of one gender shall be held to include the other gender as the context
requires; (ii) the terms “hereof,” “herein,” and “herewith” and words of similar import shall,
unless otherwise stated, be construed to refer to this Agreement as a whole and not to any
particular provision of this Agreement, and Section and paragraph references are to the Sections
and paragraphs in this Agreement unless otherwise specified; (iii) the word “including” and words
of similar import when used in this Agreement shall mean “including, without limitation,” unless
the context otherwise requires or unless otherwise specified; and (iv) the word “or” shall not be
exclusive.



18









 





          (b) With regard to each and every term and condition of this Agreement, the parties hereto
understand and agree that the same have or has been mutually negotiated, prepared and drafted, and
if at any time the parties hereto desire or are required to interpret or construe any such term or
condition, no consideration will be given to the issue of which party hereto actually prepared,
drafted or requested any term or condition of this Agreement.



          15.10. Severability. Any provision hereof that is held to be invalid, illegal or
unenforceable in any respect by a court of competent jurisdiction, shall be ineffective only to the
extent of such invalidity, illegality or unenforceability, without affecting in any way the
remaining provisions hereof, provided, however, that the parties will attempt in
good faith to reform this Agreement in a manner consistent with the intent of any such ineffective
provision for the purpose of carrying out such intent.



          15.11. Rights of Holders. Each party to this Agreement shall have the absolute right
to exercise or refrain from exercising any right or rights that such party may have by reason of
this Agreement, including, without limitation, the right to consent to the waiver or modification
of any obligation under this Agreement, and such party shall not incur any liability to any other
party or other holder of any securities of the Company as a result of exercising or refraining from
exercising any such right or rights.



[The next page is the signature page]




19









 





     IN WITNESS WHEREOF, the parties have executed this Investor Rights Agreement as of the date
first above written.



	 	 	 	 	 
	 	MARKETAXESS HOLDINGS INC.

 	 
	 	By: 	/s/ Richard M. McVey 	 
	 	 	Name: 	Richard M. McVey	 
	 	 	Title: 	Chief Executive Officer	 
	 	

TCV VI, L.P.

By: Technology Crossover Management VI, L.L.C.

Its: General Partner
 	 



	 	 	 	 	 
	 	By: 	/s/ Carla S. Newell	 
	 	 	Name: 	Carla S. Newell 	 
	 	 	Title: 	 Attorney-in-Fact 	 
	 
	 	TCV MEMBER FUND, L.P.

By: Technology Crossover Management VI, L.L.C.

Its: General Partner

 	 
	 	By: 	/s/ Carla S. Newell	 
	 	 	Name: 	Carla S. Newell 	 
	 	 	Title: 	Attorney-in-Fact