exv4w2






Exhibit 4.2




GAIN CAPITAL HOLDINGS, INC.

AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT




     This AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (this “Agreement”) is entered into as
of January 11, 2008, and amends and restates the original Investor Rights Agreement, dated as
of March 29, 2006 (the “Original Agreement”), by and among GAIN Capital Holdings, Inc., a
Delaware corporation (the “Company”), the persons identified on Schedule A hereto as
an investor (each an “Investor” and
collectively, the “Investors”) and the person identified
on Schedule A hereto as a founding stockholder (the “Founding Stockholder”).



W I T N E S S E T H:




     WHEREAS, pursuant to the Series A Preferred Stock Purchase Agreement (the “Series A Purchase
Agreement”) dated as of December 2, 1999, by and among Gain Capital, Inc. (a predecessor to the
Company, “Gain Capital”) and the several persons named therein as purchasers (collectively the
“Series A Investors”), the Series A Investors purchased an aggregate of 4,545,455 shares of Gain
Capital’s Series A Preferred Stock, par value $0.001 per share, which, pursuant to a prior
reorganization transaction effected in connection with the purchase of shares of Series D Preferred
Stock (the “Reorganization Transaction”), were converted into shares of the Company’s Series A
Preferred Stock, par value $0.00001 per share (the
“Series A Preferred Stock”);



     WHEREAS, pursuant to the Series B Preferred Stock Purchase Agreement, (the “Series B Purchase
Agreement”) dated as of July 25, 2001, by and among Gain Capital and the several persons named
therein as purchasers (collectively the “Series B Investors”), the Series B Investors purchased an
aggregate of 3,000,000 shares of Gain Capital’s Series B Preferred Stock, par value $0.001 per
share, which, pursuant to the Reorganization Transaction, were converted into shares of the
Company’s Series B Preferred Stock, par value $0.00001 per
share (the “Series B Preferred Stock”);



     WHEREAS, pursuant to the Series C Preferred Stock Purchase Agreement (the “Series C Purchase
Agreement”) dated as of August 1, 2003, by and among Gain Capital Group, Inc. and the several
persons named therein as purchasers (collectively the “Series C Investors”), the Series C
Investors purchased an aggregate of 2,496,879 shares of Series C Preferred Stock, par value
$0.001 per share, which, pursuant to the Reorganization Transaction, were converted into shares
of the Company’s Series C Preferred Stock, par value $0.00001 per share (the “Series C Preferred
Stock”);



     WHEREAS, pursuant to the Series D Preferred Stock Purchase Agreement (the “Series D Purchase
Agreement”) dated as of March 26, 2006, by and among the Company, VantagePoint Venture Partners IV
(Q), L.P., a Delaware limited partnership (“VantagePoint”) and the other purchasers named therein
(together with VantagePoint, the “Series D Investors”),
the Series D Investors purchased an aggregate of 3,254,678
shares of Series D Preferred Stock, par
value $0.00001 per share (the “Series D Preferred Stock”);



 









 





     WHEREAS, pursuant to the Series E Preferred Stock Purchase Agreement (the “Series E Purchase
Agreement”) dated as of the date hereof, by and among the Company and 3i U.S. Growth Partners L.P.,
3i Technology Partners III L.P. VantagePoint Venture Partners IV (Q), L.P., VantagePoint Venture
Partners IV, L.P., VantagePoint Venture Partners IV Principals Fund, L.P. and VP New York Venture
Partners, L.P. (collectively, the “Series E Investors”), the Company has offered shares of the
Company’s Series E Preferred Stock (as defined below) and the Series E Investors have agreed to
purchase an aggregate of 2,611,606 shares of Series E Preferred Stock, $0.00001 par value (the
“Series E Preferred Stock”) of the Company;



     WHEREAS, pursuant to the Original Agreement, the Company granted certain registration
rights and financial information rights to the Series A Investors, the Series B Investors, the
Series C Investors and the Series D Investors;



     WHEREAS, the Company and the undersigned Series A Investors, Series B Investors, Series C
Investors and Series D Investors constitute the requisite parties necessary to amend and restate
the Original Agreement; and



     WHEREAS, the Company wishes to grant certain rights to the Series E Investors with respect to
the Series E Preferred Stock being purchased in accordance with the Series E Purchase Agreement as
set forth herein.



     NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties, covenants and conditions set forth in this Agreement, and for the good and valuable
consideration, the parties, intending to be legally bound, mutually agree that the Original
Agreement is hereby amended and restated as follows:



SECTION 1. GENERAL




     1.1 Definitions. As used in this Agreement the following terms shall have the
following respective meanings:



          “Blue Rock Entities” means Blue Rock Capital, L.P., Blue Rock Partners, L.P., and any hedge or
mutual funds or other investment vehicles or entities of which any of the foregoing entities are
affiliates.




          “Common Stock” means the common stock of the Company, par value of $0.00001 per share, and any
stock into which such common stock of the Company may hereafter be converted upon a
reclassification of such common stock in accordance with law.




          “Cross Atlantic Entities” means Cross Atlantic Technology Fund, L.P., XATF Management, LP,
Cross Atlantic Capital Partners, and any hedge or mutual funds or other investment vehicles or
entities of which any of the foregoing entities are affiliates.




          “Edison Entities” means Edison Venture Fund IV SBIC, L.P., Edison Partners IV, SBIC, LLC, and
any hedge or mutual funds or other investment vehicles or entities of which any of the foregoing
entities are affiliates.




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




          “Form S-3” means such form under the Securities Act as in effect on the date hereof or any
successor registration form under the Securities Act subsequently adopted by the SEC which permits
inclusion or incorporation of substantial information by reference to other documents filed by the
Company with the SEC.




          “Holder” means (a) any person owning of record Registrable Securities that have not been sold
to the public or (b) any assignee of record of such Registrable Securities in accordance with
Section 2.10 hereof.




          “Initial Public Offering” means the Company’s first firm commitment
underwritten public offering of its Common Stock registered under the Securities Act covering the
offer and sale by the Company of its Common Stock.




          “Major Investor Entities” means the Blue Rock Entities, the Cross Atlantic Entities, the
Edison Entities, the Tudor Entities, the VantagePoint Entities and the 3i Entities.




          “Preferred Stock” means the Series A Preferred Stock, the Series B Preferred Stock, the Series
C Preferred Stock, the Series D Preferred Stock and the Series E Preferred Stock.




          “Qualified Public Offering” means an underwritten, firm commitment public offering registered
under the Securities Act (other than on Form S-4 or S-8 or any successor forms thereto) covering
the offer and sale by the Company of its Common Stock in which the aggregate gross proceeds to the
Company and/or its stockholders exceed $50,000,000 (calculated after deducting underwriters’
commissions and other offering expenses); provided that the gross proceeds for the account of the
Corporation exceed $25,000,000 (calculated after deducting underwriters commissions and other
offering expenses), and in which the public offering price per share of Common Stock (calculated
before deducting underwriters’ discounts and commissions) equals or exceeds the sum of (x) $18.44
(appropriately adjusted for stock splits, reverse stock splits and similar type transactions or
occurrences with respect to the Common Stock) and (y) accumulated but unpaid dividends on one share
of Series D Preferred Stock, and in which the Corporation’s Common Stock is listed for trading on
the New York Stock Exchange, the NASDAQ National Market or the London Stock Exchange.




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




          “Registrable Securities” means (a) any Shares; (b) any other shares of Common Stock now or
hereafter held by the Investors or issuable to the Investors pursuant to options, warrants or
convertible securities; and (c) any Common Stock of the Company issued as (or issuable upon the
conversion or exercise of any warrant, right or other security which is issued as) a dividend or
other distribution with respect to, or in exchange for, or in replacement of, such




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above-described securities. Notwithstanding the foregoing, Registrable Securities shall cease to
include any securities that have been sold by a person to the public pursuant to a registration
statement in compliance with the Securities Act or pursuant to Rule 144 or sold in a private
transaction in which the transferor’s rights under Section 2 of this Agreement are not assigned.




          “Registrable Securities then outstanding” shall be the number of shares determined by
calculating the total number of shares of Common Stock that are Registrable Securities and
either (a) are then issued and outstanding or (b) are issuable pursuant to then exercisable or
convertible securities.




          “Registration Expenses” shall mean all expenses incurred by the Company in
complying with Sections 2.2, 2.3, 2.4 and 2.6 hereof, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of counsel for the Company,
reasonable fees and disbursements of a single special counsel for the Holders, blue sky fees and
expenses and fees and expenses of the Company’s accountants, including the expense of any special
audits incident to or required by any such registration (but excluding the compensation of regular
employees of the Company which shall be paid in any event by the Company) and excluding Selling
Expenses.




          “Rule 144” shall mean Rule 144 promulgated under the Securities Act, as such Rule may be
amended from time to time, or any similar successor rule that may be promulgated under the
Securities Act.




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




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




          “Selling Expenses” shall mean all underwriting discounts and selling commissions
applicable to the sale of Registrable Securities.




          “Shares” means the shares of Common Stock issued or issuable upon the conversion of the
Preferred Stock or other preferred equity securities of the Company now or hereafter owned by the
Holders.




          “3i Affiliate” means any direct or indirect subsidiary, parent, general partner, limited
partner or affiliate of the 3i Entities or of 3i Group plc or any entity or vehicle in which 3i
Group plc and/or its affiliate has a majority economic interest and which is managed or advised by
3i Group plc or any of its affiliates.




          “3i
Entities” means 3i U.S. Growth Partners L.P. and 3i Technology Partners III L.P.




          “Tudor Entities” means each of the following: Tudor BVI Global Portfolio Ltd., Tudor
Proprietary Trading, LLC, Raptor Global Portfolio, Ltd., Witches Rock Portfolio, Ltd., Tudor
Investment Corporation, Tudor Global Trading Inc., Tudor Venture II, L.P., Tudor




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Ventures III, L.P., Tudor Private Equity Fund, L.P., Tudor Arbitrage Partners, L.P., Tudor BVI
Futures, Ltd., Raptor Global Portfolio, L.P., Raptor Global Fund, L.P., Raptor Global Fund Ltd.,
ALTAR Rock Fund L.P., and their respective affiliates and any hedge or mutual funds other
investment vehicles or entities of which any of the foregoing entities are affiliates, or any
affiliate or affiliated group of Tudor Investment Corporation and/or Tudor Global Trading, Inc.




          “VantagePoint
Entities”
means VantagePoint, VantagePoint Venture Partners IV, L.P.,
VantagePoint Venture Partners IV Principals Fund, L.P., VP New York Venture Partners, L.P. and any
hedge or mutual funds other investment vehicles or entities of which any of the foregoing entities
are affiliates.




          “Warrants” means the warrants exercisable for shares of Series B Preferred Stock and issuable
to the Investors in connection with their purchase of Series B Preferred Stock.




SECTION 2. REGISTRATION; RESTRICTIONS ON TRANSFER




     2.1 Restrictions on Transfer.



          (a) Each Holder agrees not to make any disposition of all or any portion of the
Registrable Securities, Preferred Stock or Warrants unless and until:




               (i) There is then in effect a registration statement under the Securities Act covering
such proposed disposition and such disposition is made in accordance with such registration
statement;



               (ii) Such disposition is made pursuant to and in compliance with Rule 144 (it is agreed
that the Company will not require opinions of counsel for transactions made pursuant to Rule 144
except in unusual circumstances); or



               (iii) The transferee has agreed in writing to be bound by the terms of this Agreement, (B)
such Holder shall have notified the Company of the proposed disposition and shall have furnished
the Company with a detailed statement of the circumstances surrounding the proposed disposition,
and (C) if reasonably requested by the Company, such Holder shall have furnished the Company with
an opinion of counsel, reasonably satisfactory to the Company, that such disposition will not be
required to be registered under the Securities Act.



          (b) Notwithstanding the provisions of paragraphs (i), (ii) and (iii) above, no
such registration statement or opinion of counsel shall be necessary for a transfer by a
Holder
which is (A) a limited or general partnership to its partners, or former partners, (B) a
corporation
to its shareholders in accordance with their interest in the corporation or to its affiliate,
(C) a
limited liability company to its members or former members, (D) to the Holder’s immediate
family members or a trust for the benefit of an individual Holder or such Holder’s immediate
family members, (E) in the case of Tudor Ventures II, L.P. (“Tudor”), to any Tudor Entity, (F)
in
the case of any VantagePoint Entity, to any VantagePoint Entity or (G) in the case of the 3i
Entities, to any 3i Affiliate; provided that in each case the transferee will be subject to
the terms
of this Agreement to the same extent as if he were an original Holder hereunder.




          (c) Each certificate representing Registrable Securities shall (unless otherwise




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permitted by the provisions of the Agreement) be stamped or otherwise imprinted with a legend
substantially similar to the following (in addition to any legend required under applicable state
securities laws):





THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR
UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL OR
OTHER EVIDENCE SATISFACTORY TO THE COMPANY AND ITS COUNSEL
THAT SUCH REGISTRATION IS NOT REQUIRED.



          (d) The Company shall be obligated to reissue promptly unlegended
certificates at the request of any Holder thereof if the Holder shall have obtained an opinion
of
counsel (which counsel may be counsel to the Company) reasonably acceptable to the Company
to the effect that the securities proposed to be unlegended may lawfully be so disposed of
without registration, qualification or legend.




          (e) Any legend endorsed on an instrument pursuant to applicable state
securities laws and the stop-transfer instructions with respect to such securities shall be
removed
upon receipt by the Company of an order of the appropriate blue sky authority authorizing such
removal.




     2.2 Demand Registration.



          (a) Subject to the conditions of this Section 2.2, if (x) at any time prior to the
Initial Public Offering the Company receives a written request from the Holders of a majority of
the Registrable Securities then outstanding or (y) at any time subsequent to the Initial Public
Offering the Company receives a written request from the Holders of 30% of the Registrable
Securities then outstanding (as applicable, the “Initiating Holders”) that the Company file a
registration statement under the Securities Act covering the registration of all or a part of the
Registrable Securities held by such Holders, then the Company shall:




          (A) within 15 days of the receipt thereof, give notice of such request to all
Holders, and use its best efforts to effect, as soon as practicable, the registration of all
Registrable Securities that the Holders have requested to be registered; and




          (B) as soon as practicable, use its best efforts to effect such registration,
qualification or compliance (including, without limitation, the execution of an undertaking
to
file post-effective amendments, appropriate qualification under applicable blue sky or other
state securities laws, and appropriate compliance with applicable regulations issued under
the
Securities Act and any other governmental requirements or regulations) as may be so requested
and as would permit or facilitate the sale and distribution of all or such portion of such




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Registrable Securities as are specified in such request, together with all or such portion of the
Registrable Securities of any Holders joining in such request as are specified in a written
request received by the Company within 15 days after the date the Company mails such written
notice. The Company may include in such registration any securities, for its own account or for
the account of a security holder or holders, subject to the limitations set forth in Section
2.2(b) below.




          (b) If the Initiating Holders intend to distribute the Registrable Securities by
means of an underwriting, they shall so advise the Company as a part of their demand pursuant
to this Section 2.2 or Section 2.4 and the Company shall include such information in the
notice
referred to in Section 2.2(a) or Section 2.4(a), as
applicable. In such event, the right of
any
Holder to include its Registrable Securities in such registration shall be conditioned upon
participation in such underwriting. The underwriter or underwriters for such offering shall be
one of the Company’s historical underwriters or another underwriter selected by a majority in
interest of the Initiating Holders and reasonably acceptable to the
Company. Notwithstanding
any other provision of this Section 2.2 or Section 2.4, if the underwriter advises the Company
that marketing factors require a limitation of the number of securities to be underwritten
(including Registrable Securities) then the Company shall so advise all participating Holders,
and the number of shares that may be included in the underwriting and registration shall be
allocated pro rata to the participating Holders based on the number of Registrable Securities
held; provided, however, the percentage of securities assigned to the VantagePoint Entities
shall
in no case be lower than thirty percent (30%) of the total number of securities underwritten;
provided, further, that the number of shares of Registrable Securities to be included in such
underwriting and registration shall not be reduced unless all other securities of the Company
and
all securities that are not Registrable Securities are first entirely excluded from the
underwriting
and registration; and provided, further, that notwithstanding the foregoing, the Founding
Stockholder shall have, with respect to an underwritten Initial Public Offering, the priority
right
to include his shares in any “green shoe” up to his pro rata share of securities sold by the
stockholders in such underwritten Initial Public Offering to the extent not included in the
underwritten Initial Public Offering.




          (c) The Company shall not be required to effect a registration pursuant to this
Section 2.2:




               (i) prior to the earlier of (A) the third anniversary of the date of
the
Original Agreement or (B) six months following the effective date of the registration statement
pertaining to a Qualified Public Offering;



               (ii) after
the Company has effected two (2) registrations pursuant to this Section 2.2 and
such registrations have been declared or ordered effective by the SEC and pursuant to which
securities have been sold;



               (iii) during the period starting with the date of filing of, and ending on the date six
months following the effective date of, a registration statement pertaining to any underwritten
public offering made pursuant to this Section 2.2;



               (iv) if within thirty (30) days of receipt of a written request from




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Initiating Holders pursuant to Section 2.2(a), the Company gives notice to the Holders of the
Company’s intention to make its Initial Public Offering within ninety (90) days;




               (v) if the Company shall furnish to the Initiating Holders a certificate signed by the
Chairman of the Board stating that in the good faith judgment of the Board of Directors, it would
be seriously detrimental to the Company and its stockholders for such registration to be effected
at such time, in which event the Company shall have the right to defer the filing of the applicable
registration statement for a period of not more than one hundred twenty (120) days after receipt of
the request of the Initiating Holders; provided that such right to delay a request shall be
exercised by the Company not more than once in any twelve (12) month period;



               (vi) if the Initiating Holders propose to dispose of Registrable
Securities that may be immediately registered on Form S-3 and disposed of in the intended manner
pursuant to a request made pursuant to Section 2.4 below and if the Company files the requisite
Form S-3; or



               (vii) if the Initiating Holders, together with the holders of any other securities of the
Company entitled to inclusion in such registration statement, propose to sell Registrable
Securities and such other securities (if any) at an anticipated aggregate price to the public
(after deduction for underwriter’s discounts and expenses related to the issuance) of less
than $20,000,000.



     2.3 Piggyback Registrations. The Company shall notify all Holders at least thirty (30)
days prior to the filing of any registration statement under the Securities Act for a public
offering of securities of the Company (including, but not limited to, registration statements
relating to secondary offerings of securities of the Company, but excluding registration statements
relating to employee benefit plans or corporate reorganizations or other transactions under Rule
145 of the Securities Act) and will afford each such Holder an opportunity to include in such
registration statement all or part of the Registrable Securities held by such Holder. Each Holder
desiring to include Registrable Securities in any such registration statement shall notify the
Company within fifteen (15) days after the notice from the Company. Such notice shall state the
intended method of disposition of the Registrable Securities by such Holder. If a Holder decides
not to include all of its Registrable Securities in any registration statement filed by the
Company, such Holder shall nevertheless continue to have the right to include any Registrable
Securities in any subsequent registration statement or registration statements as may be filed by
the Company, all upon the terms and conditions set forth herein.



          (a) Underwriting. If the registration statement under which the Company gives notice
under this Section 2.3 is for an underwritten offering, the Company shall so advise the Holders. In
such event, the right of any Holder to include Registrable Securities in the registration statement
pursuant to this Section 2.3 shall be conditioned upon the Holder’s participation in the
underwriting. Notwithstanding any other provision of the Agreement, if the underwriter determines
in good faith that marketing factors require a limitation of the number of shares to be
underwritten, the number of shares that may be included in the underwriting shall be allocated,
first, to the Company; second, to the Holders pro rata based on the total number of Registrable
Securities held by the Holders (provided, however, notwithstanding anything to the





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contrary in the paragraph, the percentage of securities assigned to the VantagePoint Entities shall
in no case be lower than thirty percent (30%) of the total number of securities underwritten); and
third (to the extent of availability), to any other stockholder of the Company (other than a
Holder) on a pro rata basis based on the total number of shares of Common Stock then held by such
other stockholders. Notwithstanding the foregoing, the Founding Stockholder shall have, with
respect to an underwritten Initial Public Offering, the priority right to include his shares in any
“green shoe” up to his pro rata share of securities sold by the stockholders in such underwritten
Initial Public Offering to the extent not included in the underwritten Initial Public Offering.




          (b) Right to Terminate Registration. The Company shall have the right to terminate or
withdraw any registration initiated by it under this Section 2.3 prior to the effectiveness of such
registration whether or not any Holder has elected to include securities in such registration. The
Registration Expenses of such withdrawn registration shall be borne by the Company in accordance
with Section 2.5 hereof.




     2.4 Form S-3 Registration.



          (a) If the Company shall receive from any Holder or Holders a request that the Company
effect a registration on Form S-3 or any similar short-form registration statement and any related
qualification or compliance with respect to all or a part of the Registrable Securities owned by
such Holder or Holders, the Company will:




               (i) promptly give notice of the proposed registration, and any related qualification or
compliance, to all other Holders of Registrable Securities; and



               (ii) as soon as practicable, effect such registration and all such
qualifications and compliances as would permit or facilitate the sale and distribution of the
Registrable Securities specified in such request, together with the Registrable Securities of any
other Holder or Holders joining in such request by notice to the Company given within fifteen (15)
days after receipt of such notice from the Company; provided, however, that the Company shall not
be obligated to effect any such registration, qualification or compliance pursuant to this Section
2.4:



                    (1) if Form S-3 is not available for such offering by the
Holders, or



                    (2) if the Holders, together with the holders of any other
securities of the Company entitled to inclusion in such registration, propose to sell Registrable
Securities and such other securities (if any) at an anticipated aggregate price to the public of
less than $1,000,000, or



                    (3) if the Company shall furnish to the Holders a certificate
signed by the Chairman of the Board stating that in the good faith judgment of the Board of
Directors, it would be seriously detrimental to the Company and its stockholders for such Form S-3
registration to be effected at such time, in which event the Company shall have the right to defer
the filing of the Form S-3 registration statement for a period of not more than ninety (90) days
after receipt of the request of the Holder or Holders under this Section 2.4; provided, that



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such right to delay a request shall be exercised by the Company not more than once in any
twelve (12) month period, or




                    (4) if the Company has, within the twelve (12) month period
preceding the date of such request, already effected two (2) registrations on Form S-3 for the
Holders pursuant to this Section 2.4.



          (b) Subject to the foregoing, the Company shall file a Form S-3 registration
statement covering the Registrable Securities and other securities so requested to be
registered as
soon as practicable after receipt of the request or requests of the Holders. Registrations
effected
pursuant to this Section 2.4 shall not be counted as demands for registration or registrations
effected pursuant to Section 2.2. If the initiating Holders intend to distribute Registrable
Securities pursuant to an underwriting, they shall so advise the Company in the demand
pursuant
to Section 2.2(b).




          (c) After the Company’s Initial Public Offering, the Company will use
commercially reasonable efforts to qualify for the registration of its shares of Common Stock
on
Form S-3.




     2.5 Expenses of Registration. Except as specifically provided below in this Section
2.5, all Registration Expenses incurred in connection with any registration, qualification or
compliance pursuant to Sections 2.2, 2.3 or 2.4 herein shall be borne by the Company. All
Selling Expenses incurred in connection with any registrations hereunder, shall be borne by
the
selling party, either the Company or the Holders selling the securities, as applicable. The
Company shall not, however, be required to pay for Registration Expenses regarding any
registration proceeding begun pursuant to Section 2.2, the request of which has been
subsequently withdrawn by the Initiating Holders (and such Initiating Holders hereby indemnify
the Company (on a several basis in proportion to the number of shares for which registration
was
requested) against all such expenses) unless (a) the withdrawal is based upon material adverse
information concerning the Company (including a material drop in the market price of the
Company’s common stock) of which the Initiating Holders were not aware at the time of such
request or (b) the Holders of a majority of Registrable Securities agree to forfeit their
right to one
requested registration pursuant to Section 2.2, in which event such right shall be forfeited
by all
Holders). If the Holders are required to pay the Registration Expenses, as provided above,
such
expenses shall be borne by the Holders requesting such registration in proportion to the
number
of shares for which registration was requested.



     2.6 Obligations of the Company. Whenever required to register any Registrable
Securities, the Company shall, as expeditiously as reasonably possible:



          (a) Prepare and file with the SEC a registration statement with respect to such
Registrable Securities and use all reasonable efforts to cause such registration statement to
become effective, and, upon the request of the Holders of a majority of the Registrable Securities
registered thereunder, keep such registration statement effective for up to three months for a
registration pursuant to Section 2.2 and for up to two years for a registration pursuant to Section
2.4 or, if earlier, until the Holder or Holders have completed the distribution related thereto.




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          (b) Prepare and file with the SEC such amendments and supplements to such
registration statement and the prospectus used in connection with such registration statement
as
may be necessary to keep such registration effective and comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such registration
statement for the period set forth in paragraph (a) above.




          (c) Furnish to the Holders such number of copies of a prospectus, including a
preliminary prospectus, in conformity with the requirements of the Securities Act, and such
other
documents as they may reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.




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




          (e) In the event of any underwritten public offering, enter into and perform its
obligations under an underwriting agreement, in usual and customary form, with the managing
underwriter(s) of such offering.




          (f) 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 happening of any event as a result of which the prospectus included in
such
registration statement, as then in effect, includes an untrue statement of a material fact or
omits
to state a material fact required to be stated therein or necessary to make the statements
therein
not misleading in the light of the circumstances then existing.




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




          (h) Otherwise use its commercially reasonable efforts to comply with all applicable
rules and regulations of the SEC, and make available to its security holders, as soon as reasonably
practicable, an earnings statement covering the period of at least twelve months, but not more than
eighteen months, beginning with the first month after the effective date of such registration
statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the
Securities Act.




      2.7 Furnishing Information. It shall be a condition precedent to the obligations of the
Company to take any action pursuant to Section 2.2, 2.3 or 2.4 that the selling Holders shall
furnish to the Company such information regarding themselves, the Registrable Securities held




-11-









 







by them and the intended method of disposition of such securities as shall be required under rules
and regulations promulgated under the Securities Act to effect the registration of their
Registrable Securities.




     2.8 Indemnification. In the event any Registrable Securities are included in a
registration statement under Sections 2.2, 2.3 or 2.4:



          (a) To the extent permitted by law, the Company will indemnify and hold
harmless each Holder and the partners, officers, directors and stockholders of each Holder,
any
underwriter (as defined in the Securities Act) for such Holder and each person, if any, who
controls such Holder or underwriter within the meaning of the Securities Act or the Exchange
Act, against any losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange Act or other federal or state law,
insofar
as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or
are
based upon any of the following statements, omissions or violations (collectively a
“Violation”)
by the Company: (i) any untrue statement or alleged untrue statement of a material fact
contained
in such registration statement, including any preliminary prospectus or final prospectus
contained
therein or any amendments or supplements thereto, (ii) the omission or alleged omission to
state
therein a material fact required to be stated therein, or necessary to make the statements
therein
not misleading, or (iii) any violation or alleged violation by the Company of the Securities
Act,
the Exchange Act, any state securities law or any rule or regulation promulgated under the
Securities Act, the Exchange Act or any state securities law in connection with the offering
covered by such registration statement; and the Company will pay as incurred to each such
Holder, partner, officer, director, stockholder, underwriter or controlling person for any
legal or
other expenses reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the indemnity agreement
contained in this Section 2.8(a) shall not apply to amounts paid in settlement of any such
loss,
claim, damage, liability or action if such settlement is effected without the consent of the
Company, which consent shall not be unreasonably withheld, nor shall the Company be liable in
any such case for any such loss, claim, damage, liability or action to the extent that it
arises out
of or is based upon a Violation which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such registration by such Holder,
partner, officer, director, stockholder, underwriter or controlling person of such Holder.




          (b) To the extent permitted by law, each Holder will, if Registrable Securities
held by such Holder are included in the securities as to which such registration,
qualification or
compliance is being effected, severally and not jointly, indemnify and hold harmless the
Company, each of its directors, its officers and each person, if any, who controls the Company
within the meaning of the Securities Act, any underwriter and any other Holder selling
securities
under such registration statement or any of such other Holder’s partners, directors, officers
or
stockholders or any person who controls such Holder, against any losses, claims, damages or
liabilities to which the Company or any such person may become subject under the Securities
Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages
or
liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in
each case
to the extent (and only to the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished by such Holder under an instrument duly executed
by such Holder and stated to be specifically for use in connection with such registration; and




-12-









 







each such Holder will pay as incurred any legal or other expenses reasonably incurred by the
Company or any such person in connection with investigating or defending any such loss, claim,
damage, liability or action if it is judicially determined that there was such a Violation;
provided, however, that the indemnity agreement contained in this Section 2.8(b) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement
is effected without the consent of the Holder, which consent shall not be unreasonably withheld;
provided further, that in no event shall any indemnity and payment obligation under this Section
2.8 exceed the net proceeds (after deducting commissions, taxes and other expenses) from the
offering received by such Holder.




          (c) Promptly after receipt by an indemnified party under this Section 2.8 of
notice of the commencement of any action (including any governmental action), such
indemnified party will, if a claim in respect thereof is to be made against any indemnifying
party
under this Section 2.8, deliver to the indemnifying party a written notice of the commencement
thereof and the indemnifying party shall have the right to participate in, and, to the extent
the
indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to
assume the defense thereof with counsel mutually satisfactory to the parties; provided,
however,
that an indemnified party shall have the right to retain its own counsel, with the fees and
expenses to be paid by the indemnifying party, if representation of such indemnified party by
the
counsel retained by the indemnifying party would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the indemnifying party
within
a reasonable time of the commencement of any such action, if materially prejudicial to its
ability
to defend such action, shall relieve such indemnifying party of any liability to the
indemnified
party under this Section 2.8, but the omission so to deliver written notice to the
indemnifying
party will not relieve it of any liability that it may have to any indemnified party otherwise
than
under this Section 2.8.




          (d) If the indemnification provided for in this Section 2.8 is held by a court of
competent jurisdiction to be unavailable to an indemnified party with respect to any losses,
claims, damages or liabilities referred to herein, the indemnifying party, in lieu of
indemnifying
such indemnified party thereunder, shall to the extent permitted by applicable law contribute
to
the amount paid or payable by such indemnified party as a result of such loss, claim, damage
or
liability in such proportion as is appropriate to reflect the relative fault of the
indemnifying party
on the one hand and of the indemnified party on the other in connection with the Violation(s)
that resulted in such loss, claim, damage or liability, as well as any other relevant
equitable
considerations. The relative fault of the indemnifying party and of the indemnified party
shall be
determined by a court of law by reference to, among other things, whether the untrue or
alleged
untrue statement of a material fact or the omission to state a material fact relates to
information
supplied by the indemnifying party or by the indemnified party and the parties’ relative
intent,
knowledge, access to information and opportunity to correct or prevent such statement or
omission; provided, that in no event shall any contribution by a Holder hereunder exceed the
net
proceeds (after deducting commissions, taxes and other expenses) from the offering received by
such Holder.




          (e) The obligations of the Company and Holders under this Section 2.8 shall
survive completion of any offering of Registrable Securities in a registration statement and
the




-13-









 








termination
of this Agreement. No indemnifying party, in the defense of any such claim or
litigation, shall, except with the consent of each indemnified party, 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.




     2.9 Termination of Registration Rights. All registration rights granted under this
Section 2 shall terminate and be of no further force and effect once all Registrable
Securities held
by and issuable to Holders (and their affiliates, partners, former partners, members and
former
members) may be sold under Rule 144 during any ninety
(90) day period.



     2.10 Assignment of Registration Rights. The rights to cause the Company to register
Registrable Securities pursuant to this Section 2 may be assigned by a Holder to a transferee
or
assignee of Registrable Securities which (a) is a subsidiary, parent, general partner, limited
partner, former partner, member, shareholder, former member or affiliate of a Holder, (b) is a
Holder’s immediate family member or trust for the benefit of an individual Holder or immediate
family members, (c) acquires at least fifty percent (50%) of the shares of Registrable
Securities
then held by the transferring Holder, (d) acquires at least twenty percent (20%) of the
Registrable
Securities then outstanding (as adjusted for stock splits and combinations), (e) in the case
of
Tudor, to any Tudor Entity, or (f) in the case of the 3i Entities, to any 3i Affiliate;
provided,
however, (i) the transferor shall, within ten (10) business days after such transfer or
assignment,
furnish to the Company written notice of the name and address of such transferee or assignee
and
the securities with respect to which such registration rights are being assigned and (ii) such
transferee or assignee shall agree to be subject to all restrictions set forth in this
Agreement.



     2.11 Amendment of Registration Rights. Any provision of this Section 2 may be
amended and the observance thereof may be waived (either generally or in a particular instance
and either retroactively or prospectively), only with the written consent of the Company and
holders of at least a majority of the Registrable Securities; provided that no such amendment
or
waiver shall affect any Holder in a more adverse or disproportionate manner than the other
Holders without obtaining the consent of such adversely and disproportionately affected Holder
(excluding for this purpose any adverse or disproportional effects resulting solely from
differences in the numerical per share dividend rate, ranking, original issue price,
redemption
price or conversion price of a series of Preferred Stock). Any amendment or waiver effected in
accordance with this Section 2.11 shall be binding upon each
Holder and the Company. By
acceptance of any benefits under this Section 2, Holders of Registrable Securities hereby
agree to
be bound by the provisions hereunder.



     2.12 Limitation on Subsequent Registration Rights. After the date of this
Agreement, the Company shall not, without the prior written consent of the Holders of a
majority
of the Registrable Securities then outstanding, enter into any agreement with any holder or
prospective holder of any securities of the Company that would grant such holder registration
rights senior to, or on a parity with, those granted to the Holders hereunder.



     2.13 “Market Stand-Off” Agreement; Agreement to Furnish Information. Each
Holder hereby agrees that such Holder shall not sell or otherwise transfer or dispose of any
Common Stock (or other securities) of the Company held by such Holder (other than those




-14-









 







included in the registration) for a period specified by the representative of the underwriters of
Common Stock (or other securities) of the Company not to exceed one hundred eighty (180) days
following the effective date of a registration statement of the Company filed under the Securities
Act; provided that:




               (i) such agreement shall apply only to, and in connection with, the Company’s Initial
Public Offering; and



               (ii) all officers and directors of the Company and holders of at least one percent (1%)
of the Company’s voting securities enter into similar agreements.



     Each Holder agrees to execute and deliver such other agreements as may be reasonably requested
by the Company or the underwriter which are consistent with the foregoing or which are necessary to
give further effect thereto. In addition, if requested by the Company or the representative of the
underwriters of Common Stock (or other securities) of the Company, each Holder shall provide,
within ten (10) days of such request, such information as may be required by the Company or such
representative to comply with rules and regulations promulgated under the Securities Act in
connection with the completion of any public offering of the Company’s securities pursuant to a
registration statement filed under the Securities Act. The obligations described in this Section
2.13 shall not apply to a registration relating solely to employee
benefit plans on Form S-1 or
Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely
to a Rule 145 transaction on Form S-4 or similar forms that may be promulgated in the future. The
Company may impose stop-transfer instructions with respect to the shares of Common Stock (or other
securities) subject to the foregoing restriction until the end of said one hundred eighty (180) day
period.



     2.14 Rule 144 Reporting. With a view to making available to the Holders the benefits of
certain rules and regulations of the SEC which may permit the resale of the Registrable Securities
to the public without registration, the Company agrees to use its best efforts to:



          (a) Make and keep public information available, as those terms are
understood and defined in Rule 144 or any similar or analogous rule promulgated under the
Securities Act, at all times after the effective date of the first registration filed by the
Company
for an offering of its securities to the general public;




          (b) File with the SEC, in a timely manner, all reports and other documents
required of the Company under the Exchange Act; and




          (c) So long as a Holder owns any Registrable Securities, furnish to such
Holder forthwith upon request: a written statement by the Company as to its compliance with
the
reporting requirements of Rule 144 and of the Exchange Act (at any time after it has become
subject to such reporting requirements); a copy of the most recent annual or quarterly report
of
the Company; and such other reports and documents as a Holder may reasonably request in
availing itself of any rule or regulation of the SEC allowing it to sell any such securities
without
registration.




-15-









 





SECTION 3. COVENANTS OF THE COMPANY




     3.1 Basic Financial Information and Reporting.



          (a) The Company will maintain true books and records of account in which
full and correct entries will be made of all its business transactions pursuant to a system of
accounting established and administered in accordance with U.S. generally accepted accounting
principles consistently applied, and will set aside on its books all such proper accruals and
reserves as shall be required under U.S. generally accepted accounting principles consistently
applied.




          (b) Within one hundred fifty (150) days after the end of each fiscal year of the
Company and so long as an Investor (with its affiliates) owns (or holds securities convertible
into
or exercisable for) at least 500,000 Shares (as may be adjusted from time to time for stock
splits,
stock dividends, combinations, subdivision, recapitalizations and the like) (a “Major
Investor”),
the Company will furnish each Major Investor a consolidated balance sheet of the Company, as
at the end of such fiscal year, and a consolidated statement of income and a consolidated
statement of cash flows of the Company, for such year, all prepared in accordance with U.S.
generally accepted accounting principles consistently applied and setting forth in each case
in
comparative form the figures for the previous fiscal year and the figures from the most recent
budget approved by the Board of Directors, all in reasonable detail. Such financial statements
shall be accompanied by a report and opinion thereon by independent public accountants of
national standing whose selection has been approved by the Board of Directors.




          (c) The Company will furnish each such Major Investor (i) at least thirty (30)
days prior to the beginning of each fiscal year a consolidated annual budget and operating
plans,
for such fiscal year approved by the Board of Directors (and as soon as available, any
subsequent
revisions thereto); and (ii) within thirty (30) days after the end of each month and fiscal
quarter, a
consolidated balance sheet of the Company as of the end of each such month or fiscal quarter,
and a consolidated statement of income and a consolidated statement of cash flows of the
Company for such month or fiscal quarter and for the current fiscal year to date, including a
comparison to plan figures for such period, prepared in accordance with U.S. generally
accepted
accounting principles consistently applied, excluding footnotes and year-end adjustments, and
a
narrative discussion and analysis of the results of operations and financial condition of the
Company.




          (d) The Company will furnish to each Major Investor:




               (i) promptly following receipt by the Company, each audit response letter, accountant’s
management letter and other written report submitted to the Company by its independent public
accountants in connection with an annual or interim audit of the books of the Company or any of its
subsidiaries; and



               (ii) promptly after the commencement thereof, written notice of all actions, suits,
claims, proceedings, investigations and inquiries by, against or affecting the Company that could
materially adversely affect the Company or any of its subsidiaries, if any; and



-16-









 





               (iii) within ten (10) days after receipt thereof, copies of any
notifications received by it regarding any defaults or alleged defaults or any loans or leases to
which the Company is a party; and



               (iv) promptly, from time to time, such other information regarding the business,
prospects, financial condition, operations, property or affairs of the Company and its subsidiaries
as such Major Investor reasonably may request, including, but not limited to,
advertising, sales, and promotion costs and all marketing and sales personnel salaries and board
approved compensation plans.



     3.2 Inspection Rights. Each Major Investor shall have the right, at its expense (but
without any responsibility to defray expenses incurred by the Company in complying with its
obligations under this Section 3.2), to visit and inspect any of the properties of the Company
or
any of its subsidiaries, and to discuss the affairs, finances and accounts of the Company or
any of
its subsidiaries with its officers, and to review such information as is reasonably requested
all at
such reasonable times and as often as may be reasonably requested; provided, however, that the
Company shall not be obligated under this Section 3.2 with respect to a Major Investor that is
itself a competitor of the Company.



     3.3
Confidentiality of Records. Except with respect to such Investors as are parties
to separate confidentiality agreements with the Company (the terms of which separate
confidentiality agreements shall control), each Investor, on behalf of itself and its
managers,
directors, officers, employees, representatives and other advisors (collectively, the
“Investor
Parties”) agrees for a period of four years after receipt from the Company and its agents of
any
information concerning the business and affairs of the Company (the “Confidential Material”),
to hold such information in strict confidence and to use such Confidential Information solely
for
the purpose of evaluating and managing the Investor’s investment in the Company and only to
make available such Confidential Information to such manager, directors, officers, employees,
representatives (including legal and accounting representatives) and other advisors as is
reasonably necessary for the Investor to evaluate and manage the investment or as may be
required by law or regulation or to comply with the requirements of (or to receive approvals
from) any applicable governmental agency. Notwithstanding the foregoing, “Confidential
Information” shall not include any information which: (i) is or becomes available to the
public
other than as a result of a disclosure by such Investor; (ii) was known to the Investor on a
nonconfidential basis prior to its disclosure to the Investor by the Company; or (iii) becomes
available to the Investor on a nonconfidential basis from a source other than the Company or
its
agents, provided that such source is not bound by a confidentiality agreement with the
Company.
In addition, notwithstanding the foregoing, the Investor may disclose Confidential Information
to
any affiliate of the Investor and its managers, directors, officers, employees,
representatives and
other advisors as is reasonably necessary for the sole purpose of evaluating and managing the
Investor’s investment in the Company as long as such affiliate, manager, director, officer,
employee, representative or advisor agrees to keep such information confidential and provided
such affiliate is not a competitor of the Company. Notwithstanding anything else in this
Agreement to the contrary, each party hereto (and each employee, representative, or other
agent
of any party) may disclose to any and all persons, without limitation of any kind, the Federal
income tax treatment and Federal income tax structure of any and all transaction(s)
contemplated
herein and all materials of any kind (including opinions or other tax analyses) that are or
have



-17-









 






been provided to any party (or to any employee, representative, or other agent of any party)
relating to such tax treatment or tax structure, provided, however, that this authorization of
disclosure shall not apply to restrictions reasonably necessary to comply with securities
laws.




     Notwithstanding anything to the contrary in this Section 3.3, the Company understands and
agrees that the Major Investor Entities are in the business of evaluating technologies and the
potential development plans of a large number of companies. In the course of their businesses, the
Major Investor Entities are provided access to a variety of, and a steady stream of information
regarding, many companies’ business plans, ideas and projections. Accordingly, the Company
acknowledges that the Major Investor Entities may have in the past or may in the future hold
discussions with, evaluate an investment in or develop an investment relationship with one or more
companies who could be deemed to be competitive with the Company. The Company agrees that the Major
Investor Entities may use, but not disclose, Residual Knowledge in evaluating, making or managing
investments or investment relationships. For purposes of this
Section 3.3, “Residual Knowledge” is
knowledge of ideas, concepts and know-how contained in confidential information that is retained in
the memories of persons who have had access to the confidential information. “Residual Knowledge”
shall not include confidential information that has been intentionally memorized so as to reduce it
to an intangible form for the purpose of creating Residual Knowledge.



     3.4 Reservation of Common Stock. The Company will at all times reserve and keep
available, solely for issuance and delivery upon the conversion of the Preferred Stock and
upon
exercise of the Warrants, all shares of Preferred Stock and Common Stock issuable from time to
time upon such conversion or exercise.



     3.5 Directors’ Expenses. The Company shall reimburse each member of the Board
of Directors for all reasonable out of pocket expenses incurred in connection with the
performance of such member’s duties as a Director and other reasonable expenses incurred that
are 

pre-approved by the Company.



     3.6 Directors’ Liability and Indemnification. The Company’s Certificate of
Incorporation shall provide (a) for elimination of the liability of director to the maximum
extent
permitted by law and (b) for indemnification of directors for acts on behalf of the Company to
the maximum extent permitted by law. In addition, the Company shall enter into and use its
best
efforts to at all times maintain indemnification contracts with each of its directors to
indemnify
such directors to the maximum extent permissible under Delaware law.



     3.7 Indemnification. The Company will indemnify members of the Board of
Directors to the broadest extent permitted by applicable law and will indemnify each Investor
for
any claims brought against the Investors by any third party (including any other shareholder
of
the Company) as a result of this financing and will enter into indemnification agreements with
each representative of the Major Investor Entities on the Company’s Board of Directors in a
form satisfactory to the applicable Major Investor Entity.



     3.8 Real Property Holding Corporation. The Company covenants that it will
operate in a manner such that it will not become a “United States real property holding
corporation” as that term is defined in Section 897(c)(2) of the Internal Revenue Code of
1986,



-18-









 





as amended, and the regulations thereunder (“FIRPTA”). The Company agrees to make determinations as
to its status as a USRPHC, and will file statements concerning those determinations with the
Internal Revenue Service, in the manner and at the times required
under 

Reg. 1.897-2(h), or any
supplementary or successor provision thereto. Within thirty (30) days of a request from an Investor
or any of its partners, the Company will inform the requesting party, in the manner set forth in
Reg. 1.897- 2(h)(1)(iv) or any supplementary or successor provision thereto, whether that party’s
interest in the Company constitutes a United States real property interest (within the meaning of
Internal Revenue Code Section 897(c)(1) and the regulations thereunder) and whether the Company has
provided to the Internal Revenue Service all required notices as to its USRPHC status.




     3.9 Termination of Covenants. All covenants of the Company contained in Section
3 of this Agreement (with the exception of Sections 3.4, 3.11, 3.12, and 3.13, which shall
continue for so long as any shares of Preferred Stock or Warrants remain outstanding, and
Sections 3.5, 3.6 and 3.7, which shall continue for so long as any Investor has a
representative on
the Company’s Board of Directors) shall expire and terminate as to each Investor upon the
earlier of (i) the effective date of the registration statement pertaining to the Qualified
Public
Offering or (ii) upon an acquisition of the Company by another corporation or entity by
consolidation, merger or other reorganization in which the holders of the Company’s
outstanding
voting stock immediately prior to such transaction, together with their affiliates, own
immediately after such transaction securities representing less than fifty percent (50%) of
the
voting power of the corporation or other entity surviving such transaction (a “Change in
Control”).



     3.10 Key Man Insurance. The Company will use its best efforts to maintain in full
force and effect term life insurance in the amount of $2,000,000 on the life of Glenn Stevens,
naming the Company as beneficiary.



     3.11 Directors and Officers Insurance. The Company has purchased and shall
maintain directors and officers liability insurance covering the directors and officers of the
Company in an amount of at least $5,000,000. Immediately prior to the consummation of an
Initial Public Offering the level of coverage shall be increased to at least $10,000,000.



     3.12 Employee Agreements. The Company will cause each person now or hereafter
employed by it or any subsidiary (or engaged by the Company or any subsidiary as a
consultant/independent contractor) with access to confidential information and/or trade
secrets to
enter into a non-disclosure and proprietary rights assignment agreement, substantially in the
form
approved by the Board of Directors.



     3.13 Equal Board Treatment. If any of the Major Investor Entities have
representatives on the Board of Directors of the Company, any such representatives shall be
accorded no less favorable treatment than the treatment which any other member of such Board
of Directors receives in his or her capacity as a member of such Board of Directors with
respect
to all matters, including, without limitation, expense reimbursement and access to Company
information and management; it being understood that only Independent Directors are expected
to receive equity compensation for their Board of Director service. In addition, all observers
to
the Board of Directors appointed by the Major Investor Entities shall receive equal treatment
to
each other with respect to all matters, including, without limitation, expense reimbursement.



-19-









 





SECTION 4. RIGHT OF PURCHASE




     4.1 Subsequent Offerings. The Investors, along with Founding Stockholder and
holders of more than 40,000 shares of Common Stock (each, a “Participant”, and collectively,
the “Participants”), shall have Pro Rata a right to purchase all Equity Securities, as defined
below, that the Company may, from time to time, propose to sell and issue after the date of
this
Agreement, other than the Equity Securities excluded by Section 4.6 hereof. The term “Equity
Securities” shall mean (i) any Common Stock or Preferred Stock (including, for this purpose,
any new series of Preferred Stock that is hereafter created) of the Company, (ii) any security
convertible or exchangeable, with or without consideration, into or for any Common Stock or
Preferred Stock (including any option to purchase such a convertible or exchangeable
security),
(iii) any security carrying any warrant or right to subscribe to or purchase any Common Stock
or
Preferred Stock or (iv) any such warrant or right. The term “Pro Rata” means the quotient
determined by dividing the number of shares of Common Stock held by each Participant,
assuming conversion of all Preferred Stock and exercise of all Warrants, by the total number
of
 shares of Common Stock held by all Participants, assuming conversion of all Preferred Stock
and
exercise of all Warrants.



     4.2 Exercise of Rights. If the Company proposes to issue any Equity Securities, it
shall give the Participants notice of its intention, describing the Equity Securities, the
identity of
the person(s) to whom such Equity Securities would be issued, and the price and other terms
and
conditions upon which the Company proposes to issue the same. Each Participant shall have
twenty (20) days from the receipt of such notice to agree to purchase up to its Pro Rata share
of
the Equity Securities proposed to be issued, for the price and upon the terms and conditions
specified in the notice by giving notice to the Company and stating therein the quantity of
Equity
Securities it agrees to purchase.



     4.3 Issuance of Equity Securities to Other Persons. If any Participant fails to
exercise the right of first refusal for the full amount of its Pro Rata portion of Equity
Securities
proposed to be offered by the Company, then the Company shall have one hundred twenty (120)
days thereafter to sell such of the Equity Securities not covered by a purchase election to
the
person(s) (and only the person(s)) identified by the Company in its Notice provided pursuant
to
Section 4.2, at a price no lower than, and upon other terms and conditions materially no more
favorable to the purchasers thereof than were offered to the
Investors pursuant to Section 4.2
hereof.



     4.4 Termination and Waiver of Right of First Refusal. The right of first refusal
established by this Section 4 shall not apply to, and shall terminate upon the effective date
of the
registration statement pertaining to the Company’s first Qualified Public Offering; provided,
that
if such registration does not become effective, the right of first refusal established by this
Section
4 shall be deemed to have been reinstated notwithstanding such previous termination. The
provisions of this Section 4 may be amended or waived only by the agreement of the Company
and of the Investors (or any assignee) holding a majority of the outstanding shares of voting
capital stock of the Company held by the Investors at any time; provided that no such
amendment or waiver shall affect an Investor in a more adverse or disproportionate manner than



-20-









 




the other Investors without obtaining the consent of such adversely and disproportionately affected
Investor (excluding for this purpose any adverse or disproportional effects resulting solely from
differences in the numerical per share dividend rate, ranking, original issue price, redemption
price or conversion price of a series of Preferred Stock, but including the circumstance where an
Investor’s rights under this Section 4 are waived in respect of a financing transaction in which
one or more other Investors are allowed to participate), and further provided that no right may be
taken away from the Founding Stockholder without the consent of holders of a majority of the shares
of voting capital stock held by the Founding Stockholder.




     4.5 Transfer of Rights of First Refusal. Each Investor may assign its right of first
refusal under this Section 4 in whole or in part to one or more of the following: any
subsidiary,
parent, general partner, limited partner, former partner, member, former member, general
partner
of a general partner, or affiliate of such Investor or in the case of Tudor, to any Tudor
Entity, or
in the case of VantagePoint Entities, to any VantagePoint Entity, or
in the case of the 3i
Entities,
any 3i Affiliate, who shall agree to be bound by this Agreement in connection with and
following such purchase.



     4.6 Excluded Securities. The right of first refusal established by this Section 4 shall
have no application to any of the following Equity Securities:



          (a) shares of Common Stock (and/or options, warrants or other Common
Stock purchase rights issued pursuant to such options, warrants or other rights) issued or to
be
issued to employees, officers or directors of, or consultants or advisors to the Company or
any
subsidiary, pursuant to compensation plans, compensation agreements, or other compensation
arrangements that are approved by the Board of Directors.




          (b) shares of Series E Preferred Stock issuable pursuant to the Series E
Purchase Agreement;




          (c) stock issued pursuant to the conversion or exercise of outstanding options,
outstanding warrants, or any other outstanding convertible or exercisable securities as of the
date
of this Agreement;




          (d) stock issued pursuant to rights or agreements granted after the date of this
Agreement, provided that the rights of first refusal established by this Section 4 applied
with
respect to the initial sale or grant by the Company of such rights or agreements;




          (e) any Equity Securities issued for consideration other than cash pursuant to
a merger, consolidation, acquisition or similar business combination that is approved by the
Board of Directors;




          (f) shares of Common Stock issued in connection with any stock split, stock
dividend or recapitalization by the Company;




          (g) shares of Common Stock issued upon conversion of the Shares;




          (h) any Equity Securities issued pursuant to any equipment leasing arrangement, or
debt financing from a bank or similar financial institution; provided, such




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equipment leasing arrangement, or debt financing is approved by the Board of Directors and, if
such issuances exceed in the aggregate 1,000,000 shares, the consent of the holders of at least
a majority of the Preferred Stock voting as a single class;




          (i) any Equity Securities issued in connection with strategic transactions involving
the Company and other entities, including (i) joint ventures, manufacturing, marketing or
distribution arrangements or (ii) technology transfer or development arrangements or (iii)
strategic customer relationships; provided that such strategic transactions and the issuance of
shares therein has been approved by the Board of Directors and, (x) if such issuances exceed in the
aggregate 1,000,000 shares of Common Stock (on an as-converted or exercised basis), the consent of
the holders of at least a majority of the Preferred Stock, voting as a single class and (y) if such
issuance is at a valuation below $12.29 per share, the consent of the holders of at least a
majority of the Series D Preferred Stock, voting as a separate class; or




          (j) any Equity Securities issued in connection with the Company’s Initial Public
Offering.




SECTION 5. MISCELLANEOUS




     5.1 Governing Law. This Agreement shall be governed by and construed under the laws of
the State of Delaware without giving effect to the conflicts of laws principles thereof. This
Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware
without regard to that state’s conflicts of laws principles. Any unresolved controversy or claim
arising out of or relating to this Agreement, except (i) as otherwise provided in this Agreement or
(ii) with respect to which a party seeks injunctive or other equitable relief, shall be submitted
to arbitration by one arbitrator. In connection with any arbitration conducted pursuant to this
Agreement, the Company shall nominate not less than five potential arbitrators who shall be
independent of the Company and who shall have reasonable experience in the type of transactions
provided for in this Agreement or in the area of disputes involving complex commercial
transactions. The holders of a majority of the Preferred Stock (on an as-converted basis), voting
together as a single class, shall select a single arbitrator from among the persons nominated by
the Company. The arbitration shall take place in New York City, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association (the “AAA”) then in effect, and judgment
upon any award rendered in such arbitration will be binding and may be entered in any court having
jurisdiction thereof. There shall be limited discovery prior to the arbitration hearing as follows:
(a) exchange of witness lists and copies of documentary evidence and documents relating to or
arising out of the issues to be arbitrated, (b) depositions of all party witnesses and (c) such
other discovery as may be allowed by the arbitrators. Depositions shall be conducted in accordance
with the New York Code of Civil Procedure. The arbitrator shall be required to provide in writing
to the parties the basis for the award or order of such arbitrator. A court reporter shall record
all hearings, with such record constituting the official transcript of such proceedings. Each party
will bear its own costs in respect of any disputes arising under this Agreement. The parties
knowingly and voluntarily agree to this arbitration provision and acknowledge that, except with
respect to proceedings involving a request for injunctive or other equitable relief, arbitration
shall be instead of any civil litigation, meaning that the parties each are waiving any rights to a
jury trial. Each of the parties to this Agreement consents to personal jurisdiction and venue for
any equitable action sought in the




-22-









 







United States District Court for the Southern District of New York and any state court in the State
of New York that is located in New York County (and in the appropriate appellate courts from any of
the foregoing).




     5.2 Survival. The representations, warranties, covenants, and agreements made
herein shall survive any investigation made by any Investor and the closing of the
transactions
contemplated hereby. All statements as to factual matters contained in any certificate or
other
instrument delivered by or on behalf of the Company pursuant hereto in connection with the
transactions contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.



     5.3 Successors and Assigns.



          (a) Except as otherwise expressly provided herein, the provisions hereof shall
inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors, and
administrators of the parties hereto and shall inure to the benefit of and be enforceable by
each
person who shall be a holder of Registrable Securities from time to time; provided, however,
that
prior to the receipt by the Company of adequate written notice of the transfer of any
Registrable
Securities specifying the full name and address of the transferee, the Company may deem and
treat the person listed as the holder of such shares in its records as the absolute owner and
holder
of such shares for all purposes, including the payment of dividends or any redemption price.




          (b) In addition to the provisions of Section 2.10 and notwithstanding anything
herein contained to the contrary or any provision of the Series E Purchase Agreement or any
related agreement or the Series D Purchase Agreement or any related agreement or the Series C
Purchase Agreement or any related agreement or the Series B Purchase Agreement or any related
agreement, or the Series A Purchase Agreement or any related agreement, (a) each of Blue Rock
Capital, L.P. (“BRC”), Cross
Atlantic Technology Fund, L.P. (“XATF”), Edison Venture Fund
IV, LP (“Edison”), Tudor, The Raptor Global Portfolio, Ltd. (“Raptor”) and ALTAR Rock Fund
L.P. (“Altar”) shall each have the right to assign all of its rights and obligations under
this
Agreement to a transferee or assignee which is a subsidiary, parent, general partner, limited
partner or affiliate of BRC, XATF, Edison, Tudor, Raptor or Altar, as the case may be;
provided,
however, that each of BRC, XATF, Edison, Tudor, Raptor or Altar, as the case may be, shall,
within ten (10) days after such transfer or assignment, furnish to the Company written notice
of
the name and address of such transferee or assignee and such transferee or assignee shall
agree in
writing to be subject to the restrictions set forth in this Agreement, (b) each of each of
VantagePoint, VantagePoint Venture Partners IV, L.P. (“Venture Partners”) and VantagePoint
Venture Partners IV Principals Fund, L.P. (“Principals Fund”) shall each have the right to
assign all of its rights and obligations under this Agreement to a transferee or assignee
which is
which is a subsidiary, parent, general partner, limited partner, affiliate of VantagePoint,
Vantage
Partners or Principals Fund, as the case may be, or a VantagePoint Entity; provided, however,
that each of VantagePoint, Venture Partners or Principals Fund, as the case may be, shall,
within
ten (10) days after such transfer or assignment, furnish to the Company written notice of the
name and address of such transferee or assignee and such transferee or assignee shall be
subject
to the restrictions set forth in this Agreement, and (c) the 3i Entities shall have the right
to assign
all of its rights and obligations under this Agreement to any 3i Affiliate; provided, however,
that
the 3i Entities shall, within ten (10) days after such transfer or assignment, furnish to the




-23-









 







Company written notice of the name and address of such transferee or assignee and such
transferee or assignee shall agree in writing to be subject to the restrictions set forth in
this Agreement applicable to the 3i Entities.




     5.4
Entire Agreement. This Agreement and the Schedule hereto, constitute the full
and entire understanding and agreement among the parties with regard to the subject matter
hereof.



     5.5 Severability. In case any provision of the Agreement shall be invalid, illegal, or
unenforceable, the validity, legality, and enforceability of the remaining provisions shall
not in
any way be affected or impaired thereby.



     5.6 Amendment and Waiver.



          (a) Except as otherwise expressly provided herein (including but not limited
to Section 4.4), this Agreement may be amended or modified only upon the consent of the
Company and the holders of at least a majority of the Registrable Securities; provided that no
such amendment shall affect a Major Investor Entity in a more adverse or disproportionate
manner than the other holders of Registrable Securities or any particular series of Preferred
Stock
in a more adverse and disproportionate manner than the other series of Preferred Stock
(including by affecting specific rights or obligations provided only to such Major Investor
Entity
or series of Preferred Stock) without obtaining the consent of such adversely and
disproportionately affected Major Investor Entities or series of Preferred Stock (excluding
for
this purpose any adverse or disproportional effects resulting solely from differences in the
numerical per share dividend rate, ranking, original issue price, redemption price or
conversion
price of a series of Preferred Stock).




          (b) Except as otherwise expressly provided herein, the obligations of the
Company and the rights of the Holders under this Agreement may be waived only with the
consent of the holders of at least a majority of the Registrable Securities; provided that no
such
waiver shall affect a Major Investor Entity in a more adverse or disproportionate manner than
the
other series of Preferred Stock (including by affecting specific rights or obligations
provided
only to such Major Investor Entity or series of Preferred Stock) than the other holders of
Registrable Securities or any particular series of Preferred Stock in a more adverse or
disproportionate manner without obtaining the consent of such adversely and disproportionately
affected Major Investor Entities or series of Preferred Stock (excluding for this purpose any
adverse or disproportional effects resulting solely from differences in the numerical per
share
dividend rate, ranking, original issue price, redemption price or conversion price of a series
of
Preferred Stock).




     5.7 Delays or Omissions. It is agreed that no delay or omission to exercise any right,
power, or remedy accruing to any Holder, upon any breach, default or noncompliance of the
Company under this Agreement shall impair any such right, power, or remedy, nor shall it be
construed to be a waiver of any such breach, default or noncompliance, or any acquiescence
therein, or of any similar breach, default or noncompliance
thereafter occurring. It is
further
agreed that any waiver, permit, consent, or approval of any kind or character on any Holder’s
part of any breach, default or noncompliance under the Agreement or any waiver on such



-24-









 




Holder’s part of any provisions or conditions of this Agreement must be in writing and shall be
effective only to the extent specifically set forth in such writing. All remedies, either under
this Agreement, by law, or otherwise afforded to Holders, shall be cumulative and not
alternative.




     5.8 Notices and Consents. All notices and consents required or permitted hereunder
must be in writing and shall be deemed effectively given: (a) upon personal delivery to the
party
to be notified, (b) when sent by confirmed telex or facsimile if sent during normal business
hours
of the recipient; if not, then on the next business day, (c) three business days after having
been
sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one
business
day after deposit with a nationally recognized overnight courier, specifying next day
delivery,
with written verification of receipt. All communications shall be sent to the party to be
notified
at the address as set forth on the signature pages hereof or Exhibit A hereto or at
such other
address as such party may designate by ten (10) days advance written notice to the other
parties
hereto.



     5.9
Titles and Subtitles. The titles of the sections and subsections of this Agreement
are for convenience of reference only and are not to be considered in construing this
Agreement.



     5.10
Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.



[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]




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     IN WITNESS WHEREOF, the parties hereto have executed this AMENDED AND RESTATED INVESTOR RIGHTS
AGREEMENT as of the date set forth in the first paragraph hereof.



	 	 	 	 	 
	 	COMPANY:



GAIN CAPITAL HOLDINGS, INC.

 	 
	 	By:  	/s/ Glenn Stevens
 	 
	 	 	Glenn Stevens 	 
	 	 	Chief Executive Officer 	 
	 
	 	FOUNDING STOCKHOLDER:

 	 
	 	By:  	/s/
Mark E. Galant 	 
	 	 	Mark Galant 	 
	 	 	 	 
	 	The Mark E. Galant 2007 GRAT

 	 
	 	By:  	/s/ Mark E. Galant	 
	 	 	Name:  	Mark E. Galant	 
	 	 	Title:  	Trustee 	 
	 



[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]




 









 





	 	 	 	 	 
	 	SERIES D INVESTORS:



VANTAGEPOINT VENTURES PARTNERS IV (Q), L.P.

 	 
	 	By:  	VantagePoint     Venture Associates     IV,
 	 
	 	 	L. L.C., its General Partner 	 
	 
	 	By:  	 /s/ Alan E. Salzman
 	 
	 	Name:	Alan E. Salzman  	 
	 	Title:	Managing Member 	 
	 
	 	VANTAGEPOINT VENTURE PARTNERS IV, L.P.

 	 
	 	By:  	VantagePoint Venture     Associates IV,
 	 
	 	 	L.L.C., its General Partner 	 
	 	 	 	 
	 	By:  	                        /s/ Alan E. Salzman
 	 
	 	Name:	Alan E. Salzman 	 
	 	Title:	Managing Member 	 
	 
	 	VANTAGEPOINT VENTURE PARTNERS IV PRINCIPALS FUND, L.P.

 	 
	 	By:  	VantagePoint     Venture Associates     IV,
 	 
	 	 	L.L.C., its General Partner 	 
	 	 	 
	 	By:  	                        /s/ Alan E. Salzman
 	 
	 	Name:	Alan E. Salzman  	 
	 	Title:	Managing Member 	 
	 
	 	VP NEW YORK VENTURE PARTNERS, L.P.

 	 
	 	By:  	VantagePoint Venture     Associates    IV,
 	 
	 	 	L.L.C.,  its General Partner 	 
	 	 	 
	 	By:  	                        /s/ Alan E. Salzman
 	 
	 	Name:	Alan E. Salzman 	 
	 	Title:	Managing Member 	 
	 



[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]





 









 







	 	 	 	 	 
	 	SERIES C INVESTORS:




TUDOR VENTURES II, L.P.
 	 
	 	By:  	Tudor Ventures Group, L.P.
 	 
	 	 	its General Partner 	 
	 	 	 	 
	 	By:  	                           /s/ Carmen J. Scarpa, Jr.
 	 
	 	 	TUDOR VENTURES II L.P. 	 
	 	By:  	                        Tudor Ventures Group L.P., general partner
 	 
	 	By:  	                        Carmen J. Scarpa, Jr.
 	 
	 	 	Managing Director, Tudor Ventures Group LLC 	 
	 	 	 	 
	 	THE RAPTOR GLOBAL PORTFOLIO, LTD.
 	 
	 	By:  	Tudor Investment Corporation,
 	 
	 	 	as Investment Advisor 	 
	 	 	 
	 	By:  	                          /s/ Carmen J. Scarpa, Jr.
 	 
	 	 	Carmen J. Scarpa, Jr. 	 
	 	 	Managing Director

Tudor Investment Corporation as
Investment Advisor
 The Raptor Global Portfolio Ltd. 	 
	 
	 	ALTAR ROCK FUND L.P.
 	 
	 	By:  	Tudor Investment Corporation,
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	                          /s/ Carmen J. Scarpa, Jr.
 	 
	 	 	Carmen J. Scarpa, Jr. 	 
	 	 	Managing Director

Tudor Investment Corporation
as General Partner
 Altar Rock Fund L.P. 	 
	 



[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]





 









 






	 	 	 	 	 
	 	SERIES B INVESTORS:




EDISON VENTURE FUND IV SBIC, L.P.
 	 
	 	By:  	Edison Partners IV, SBIC, LLC,
 	 
	 	 	its General Partner 	 
	 	 	 
	 	By:  	                              /s/ Chris Sugden
 	 
	 	 	Name:  	Chris Sugden  	 
	 	 	Title:  	General Partner 	 
	 
	 	CROSS ATLANTIC TECHNOLOGY FUND, L.P.
 	 
	 	By:  	XATF Management, LP, its General Partner,
 	 
	 	 	by Cross Atlantic Capital Partners, its General 	 
	 	 	Partner 	 
	 	 	 
	 	By:  	/s/
Gerry McCrory 
 	 
	 	 	Gerry McCrory 	 
	 	 	Partner 	 
	 
	 	BLUE ROCK CAPITAL, L.P.
 	 
	 	By:  	Blue Rock Partners, L.P., its General Partner,
 	 
	 	 	by Blue Rock, Inc., its General Partner 	 
	 	 	 
	 	By:  	/s/
Virginia Breen  
 	 
	 	 	Virginia Breen  	 
	 	 	President 	 
	 



[SIGNATURE
PAGE TO INVESTOR RIGHTS AGREEMENT]





 









 





	 	 	 	 	 
	 	SERIES A INVESTORS:



CROSS ATLANTIC TECHNOLOGY FUND, L.P.
 	 
	 	By:  	XATF Management, LP, its General Partner,
 	 
	 	 	by Cross Atlantic Capital Partners, its General Partner 	 
	 	 	 
	 	By:  	                        /s/ Gerry McCrory
 	 
	 	 	Gerry McCrory 	 
	 	 	Partner 	 
	 
	 	BLUE ROCK CAPITAL, L.P.
 	 
	 	By:  	Blue Rock Partners, L.P., its General Partner,
 	 
	 	 	by Blue Rock, Inc., its General Partner 	 
	 	 	 
	 	By:  	                        /s/ Virginia Breen
 	 
	 	 	Virginia Breen 	 
	 	 	President 	 
	 



[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]





 









 





	 	 	 	 	 
	 	SERIES E INVESTORS:


3I U.S. GROWTH PARTNERS L.P.
 	 
	 	By:  	3i U.S. Growth Corporation, its general partner
 	 
	 	 	 
	 	By:  	                                       /s/ Whitney Bower
 	 
	 	Name: Whitney Bower 	 
	 	Title:   Partner 	 
	 
	 	3I TECHNOLOGY PARTNERS III L.P.
 	 
	 	By:  	3i Technology Corporation, its general partner
 	 
	 	 	 
	 	By:  	
/s/ David Silverman
 	 
	 	Name:  David Silverman	 
	 	Title:    Senior Vice President	 
	 



[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]





 









 





	 	 	 	 	 
	 	SERIES E INVESTORS:



VANTAGEPOINT VENTURE PARTNERS IV (Q), L.P.

 	 
	 	By:  	VantagePoint     Venture Associates     IV,
 	 
	 	 	L. L.C., its General Partner 	 
	 	 	 
	 	By:  	                        /s/ Alan E. Salzman
 	 
	 	Name:	Alan E. Salzman  	 
	 	Title:	Managing Member 	 
	 
	 	VANTAGEPOINT VENTURE PARTNERS IV, L.P.

 	 
	 	By:  	VantagePoint     Venture Associates     IV,
 	 
	 	 	L. L.C., its General Partner 	 
	 	 	 
	 	By:  	                        /s/ Alan E. Salzman
 	 
	 	Name:	Alan E. Salzman  	 
	 	Title:	Managing Member 	 
	 
	 	VANTAGEPOINT VENTURE PARTNERS IV PRINCIPALS FUND, L.P.

 	 
	 	By:  	VantagePoint     Venture Associates     IV,
 	 
	 	 	L. L.C., its General Partner 	 
	 	 	 
	 	By:  	                        /s/ Alan E. Salzman
 	 
	 	Name:	Alan E. Salzman  	 
	 	Title:	Managing Member 	 
	 
	 	VP NEW YORK VENTURE PARTNERS, L.P.

 	 
	 	By:  	VantagePoint     Venture Associates     IV,
 	 
	 	 	L. L.C., its General Partner 	 
	 	 	 
	 	By:  	                        /s/ Alan E. Salzman
 	 
	 	Name:	Alan E. Salzman  	 
	 	Title:	Managing Member 	 
	 



[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]





 









 








GAIN CAPITAL HOLDINGS, INC.




COUNTERPART SIGNATURE PAGE TO AMENDED AND RESTATED INVESTOR

RIGHTS AGREEMENT




January       , 2008



The undersigned desiring to become an Investor as of the date set forth above of GAIN Capital
Holdings, Inc., a Delaware corporation (the “Company”), hereby adopts and agrees to be bound by all
of the terms and provision of, and shall be entitled to all of the benefits and privileges of, the
Amended and Restated Investor Rights Agreement dated as of January 11, 2008, among the Company and
the Investors named therein (the “Investor Rights Agreement”) and further authorizes the Company to
attach this signature page to the Investor Rights Agreement in order to make the undersigned a
party to the Investor Rights Agreement.




	 	 	 	 	 
	 	 	 
	 	
 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 



[SIGNATURE PAGE TO INVESTOR RIGHTS AGREEMENT]





 









 





SCHEDULE A




Schedule of Investors




Name and Address




Founding Stockholder




Mark Galant together with The Mark E. Galant 2007 GRAT




Series A Investors




Cross Atlantic Capital Partners, Inc.

5 Radnor Corporate Center, #555

100 Matsonford Road

Radnor, PA19087




Blue Rock Capital, L.P.

230 Lackawanna Drive

Andover, NJ 07821




Series B Investors




Edison Venture Fund IV, L.P.

5 Radnor Corporate Center, #555

100 Matsonford Road

Radnor, PA19087




Cross Atlantic Capital Partners, Inc.

5 Radnor Corporate Center, #555

100 Matsonford Road

Radnor, PA19087




Blue Rock Capital, L.P.

230 Lackawanna Drive

Andover, NJ 07821




Series C Investors




Tudor Ventures II, L.P.

50 Rowes Wharf

6th Floor

Boston, MA 02110




The Raptor Global Portfolio, Ltd.

50 Rowes Wharf




 









 





6th Floor

Boston, MA 02110




ALTAR Rock Fund L.P.

50 Rowes Wharf

6th Floor

Boston, MA 02110




Series D Investors




VantagePoint Venture Partners IV (Q), L.P.

1001 Bayhill Drive, Suite 300

San Bruno, CA 94066




VantagePoint Venture Partners IV, L.P.

1001 Bayhill Drive, Suite 300

San Bruno, CA 94066




VantagePoint Venture Partners Principals Fund, L.P.

1001 Bayhill Drive, Suite 300

San Bruno, CA 94066




VP New York Venture Partners, L.P.

1001 Bayhill Drive, Suite 300

San Bruno, CA 94066




Series E Investors




3i U.S. Growth Partners L.P.

880 Winter Street, Suite 330,

Waltham, MA 02451




3i
Technology Partners III L.P.

880 Winter Street, Suite 330,

Waltham, MA 02451




VantagePoint Venture Partners IV (Q), L.P.

1001 Bayhill Drive, Suite 300

San Bruno, CA 94066




VantagePoint Venture Partners IV, L.P.

1001 Bayhill Drive, Suite 300

San Bruno, CA 94066




VantagePoint
Venture Partners Principals Fund, L.P.

1001 Bayhill Drive, Suite 300

San Bruno, CA 94066




VP New York Venture Partners, L.P.

1001 Bayhill Drive, Suite 300

San Bruno, CA 94066