Document:

exv10w3

Exhibit 10.3

 

TAX RECEIVABLE AGREEMENT

among

FXCM INC.

and

THE PERSONS NAMED HEREIN

DATED AS OF December 1, 2010

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	 	Page	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	 
	Section 1.1 Definitions
	 	 	1	 
	 
	ARTICLE II DETERMINATION OF CERTAIN REALIZED TAX BENEFIT
	 	 	8	 
	 
	Section 2.1 Exchange Basis Adjustments
	 	 	8	 
	Section 2.2 Tax Benefit Schedule
	 	 	9	 
	Section 2.3 Procedures, Amendments
	 	 	9	 
	 
	ARTICLE III TAX BENEFIT PAYMENTS
	 	 	10	 
	 
	Section 3.1 Payments
	 	 	10	 
	Section 3.2 No Duplicative Payments
	 	 	11	 
	Section 3.3 Pro Rata Payments; Coordination of Benefits
	 	 	11	 
	 
	ARTICLE IV TERMINATION
	 	 	12	 
	 
	Section 4.1 Early Termination and Breach of Agreement
	 	 	12	 
	Section 4.2 Early Termination Notice
	 	 	13	 
	Section 4.3 Payment upon Early Termination
	 	 	13	 
	 
	ARTICLE V SUBORDINATION AND LATE PAYMENTS
	 	 	13	 
	 
	Section 5.1 Subordination
	 	 	13	 
	Section 5.2 Late Payments by the Corporate Taxpayer
	 	 	14	 
	 
	ARTICLE VI NO DISPUTES; CONSISTENCY; COOPERATION
	 	 	14	 
	 
	Section 6.1 Participation in the Corporate Taxpayer’s and Holdings’ Tax Matters
	 	 	14	 
	Section 6.2 Consistency
	 	 	14	 
	Section 6.3 Cooperation
	 	 	14	 
	 
	ARTICLE VII MISCELLANEOUS
	 	 	15	 
	 
	Section 7.1 Notices
	 	 	15	 
	Section 7.2 Counterparts
	 	 	15	 
	Section 7.3 Entire Agreement; No Third Party Beneficiaries
	 	 	16	 
	Section 7.4 Governing Law
	 	 	16	 
	Section 7.5 Severability
	 	 	16	 
	Section 7.6 Successors; Assignment; Amendments; Waivers
	 	 	16	 
	Section 7.7 Titles and Subtitles
	 	 	17	 
	Section 7.8 Resolution of Disputes
	 	 	17	 
	Section 7.9 Reconciliation
	 	 	18	 
	Section 7.10 Withholding
	 	 	18	 

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	 	 	 	Page	 
	Section 7.11 Admission of the Corporate Taxpayer into a Consolidated Group; Transfers of Corporate Assets
	 	 	19	 
	Section 7.12 Confidentiality
	 	 	19	 
	Section 7.13 Change in Law
	 	 	20	 
	Section 7.14 LLC Agreement
	 	 	20	 
	Section 7.15 Independent Nature of TRA Parties’ Rights and Obligations
	 	 	20	 
	Section 7.16 Headings
	 	 	20	 

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TAX RECEIVABLE AGREEMENT

          This TAX RECEIVABLE AGREEMENT (this “Agreement”), dated as of December 1, 2010, is
hereby entered into by and among FXCM Inc., a Delaware corporation (the “Corporate
Taxpayer”) and each of the other persons from time to time a party hereto (the “TRA
Parties”) and each of the successors and assigns thereto.

RECITALS

          WHEREAS, the TRA Parties hold limited liability company interests (the “Units”) in
FXCM Holdings, LLC, a Delaware limited liability company (“Holdings”), which is classified
as a partnership for United States federal income tax purposes;

          WHEREAS, the Corporate Taxpayer holds and will hold, directly and/or indirectly, Units;

          WHEREAS, the Units that are held by the TRA Parties (as defined below) may be exchanged for
cash or Class A common stock (the “Class A Shares”) of the Corporate Taxpayer, subject to
the provisions of the Exchange Agreement (as defined below);

          WHEREAS, Holdings and each of its direct and indirect subsidiaries treated as a partnership
for United States federal income tax purposes currently have and will have in effect an election
under Section 754 of the United States Internal Revenue Code of 1986, as amended (the
“Code”), for each Taxable Year (as defined below) in which a taxable acquisition of Units
by the Corporate Taxpayer from the TRA Parties for cash or Class A Shares (an “Exchange”)
occurs;

          WHEREAS, the parties to this Agreement desire to make certain arrangements with respect to the
effect of the Exchange Basis Adjustments and Imputed Interest on the liability for Taxes (each as
defined below) of the Corporate Taxpayer;

          NOW, THEREFORE, in consideration of the foregoing and the respective covenants and agreements
set forth herein, and intending to be legally bound hereby, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

          Section 1.1 Definitions. As used in this Agreement, the terms set forth in this
Article I shall have the following meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined).

          “Affiliate” means, with respect to any Person, any other Person that directly or
indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common
Control with, such first Person.

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          “Agreed Rate” means LIBOR plus 100 basis points.

          “Agreement” is defined in the Recitals of this Agreement.

          “Amended Schedule” is defined in Section 2.3(b) of this Agreement.

          A “Beneficial Owner” of a security is a Person who directly or indirectly, through any
contract, arrangement, understanding, relationship or otherwise, has or shares: (i) voting power,
which includes the power to vote, or to direct the voting of, such security and/or (ii) investment
power, which includes the power to dispose of, or to direct the disposition of, such security. The
terms “Beneficially Own” and “Beneficial Ownership” shall have correlative
meanings.

          “Board” means the Board of Directors of the Corporate Taxpayer.

          “Business Day” means Monday through Friday of each week, except that a legal holiday
recognized as such by the government of the United States of America or the State of New York shall
not be regarded as a Business Day.

          “Change in Tax Law” is defined in Section 7.13 of this Agreement.

          “Change of Control” means the occurrence of any of the following events:

	 	(i)	 	any Person or any group of Persons acting together which would
constitute a “group” for purposes of Section 13(d) of the Securities and
Exchange Act of 1934, or any successor provisions thereto (excluding (a) a
corporation or other entity owned, directly or indirectly, by the stockholders
of the Corporate Taxpayer in substantially the same proportions as their
ownership of stock of the Corporate Taxpayer or (b) Dror Niv, any “group” for
purposes of Section 13(d) of the Securities Act of 1934 or any successor
provisions thereto that includes Dror Niv or any Person more than 50% of the
combined voting power of the then outstanding voting securities of which are
owned by Dror Niv or any such “group”) is or becomes the Beneficial Owner,
directly or indirectly, of securities of the Corporate Taxpayer representing
more than 50% of the combined voting power of the Corporate Taxpayer’s then
outstanding voting securities; or

	 	(ii)	 	the following individuals cease for any reason to
constitute a majority of the number of directors of the Corporate Taxpayer then
serving: individuals who, on the IPO Date, constitute the Board and any new
director whose appointment or election by the Board or nomination for election
by the Corporate Taxpayer’s shareholders was approved or recommended by a vote
of at least two-thirds (2/3) of the directors then still in office who either
were directors on the IPO Date or whose appointment, election or nomination for
election was previously so approved or recommended by the directors referred to
in this clause (ii); or

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	 	(iii)	 	there is consummated a merger or consolidation of the
Corporate Taxpayer with any other corporation or other entity, and, immediately
after the consummation of such merger or consolidation, either (x) the Board
immediately prior to the merger or consolidation does not constitute at least a
majority of the board of directors of the company surviving the merger or, if
the surviving company is a Subsidiary, the ultimate parent thereof, or (y) the
voting securities of the Corporate Taxpayer immediately prior to such merger or
consolidation do not continue to represent or are not converted into more than
50% of the combined voting power of the then outstanding voting securities of
the Person resulting from such merger or consolidation or, if the surviving
company is a Subsidiary, the ultimate parent thereof; or

	 	(iv)	 	the shareholders of the Corporate Taxpayer approve a plan
of complete liquidation or dissolution of the Corporate Taxpayer or there is
consummated an agreement or series of related agreements for the sale or other
disposition, directly or indirectly, by the Corporate Taxpayer of all or
substantially all of the Corporate Taxpayer’s assets, other than such sale or
other disposition by the Corporate Taxpayer of all or substantially all of the
Corporate Taxpayer’s assets to an entity, at least 50% of the combined voting
power of the voting securities of which are owned by shareholders of the
Corporate Taxpayer in substantially the same proportions as their ownership of
the Corporate Taxpayer immediately prior to such sale.

Notwithstanding the foregoing, except with respect to clause (ii) and clause (iii)(x) above, a
“Change of Control” shall not be deemed to have occurred by virtue of the consummation of any
transaction or series of integrated transactions immediately following which the record holders of
the shares of the Corporate Taxpayer immediately prior to such transaction or series of
transactions continue to have substantially the same proportionate ownership in, and own
substantially all of the shares of, an entity which owns all or substantially all of the assets of
the Corporate Taxpayer immediately following such transaction or series of transactions.

          “Class A Shares” is defined in the Recitals of this Agreement.

          “Code” is defined in the Recitals of this Agreement.

          “Consolidated Group” means any group of corporations filing consolidated, combined or
unitary tax returns of which the Corporate Taxpayer is a member.

          “Control” means the possession, direct or indirect, of the power to direct or cause
the direction of the management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise.

          “Corporate Taxpayer” is defined in the Recitals of this Agreement.

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          “Corporate Taxpayer Return” means the federal and/or state and/or local Tax Return, as
applicable, of the Corporate Taxpayer or any Consolidated Group filed with respect to Taxes of any
Taxable Year.

          “Cumulative Net Realized Tax Benefit” in respect of a TRA Party for a Taxable Year
means the cumulative amount of Realized Tax Benefits in respect of such TRA Party for all Taxable
Years of the Corporate Taxpayer, up to and including such Taxable Year, net of the cumulative
amount of Realized Tax Detriments in respect of such TRA Party for the same period. The Realized
Tax Benefit and Realized Tax Detriment in respect of each TRA Party for each Taxable Year shall be
determined based on the most recent Tax Benefit Schedule or Amended Schedule in respect of such TRA
Party, if any, in existence at the time of such determination.

          “Default Rate” means LIBOR plus 500 basis points.

          “Determination” shall have the meaning ascribed to such term in Section 1313(a) of the
Code or similar provision of state, foreign or local tax law, as applicable, or any other event
(including the execution of IRS Form 870-AD) that finally and conclusively establishes the amount
of any liability for Tax.

          “Dispute” has the meaning set forth in Section 7.8(a) of this Agreement.

          “Early Termination Date” means the date of an Early Termination Notice for purposes of
determining the Early Termination Payment.

          “Early Termination Effective Date” is defined in Section 4.2 of this Agreement.

          “Early Termination Notice” is defined in Section 4.2 of this Agreement.

          “Early Termination Schedule” is defined in Section 4.2 of this Agreement.

          “Early Termination Payment” is defined in Section 4.3(b) of this Agreement.

          “Early Termination Rate” means LIBOR plus 100 basis points.

          “Exchange” is defined in the Recitals of this Agreement.

          “Exchange Agreement” means the Exchange Agreement among the Corporate Taxpayer,
Holdings and the TRA Parties dated as of the date hereof.

          “Exchange Basis Adjustment” in respect of a TRA Party means the adjustment to the tax
basis of an Exchange Reference Asset in respect of such TRA Party under Sections 732, 734(b) and
1012 of the Code (in situations where, as a result of one or more Exchanges by such Exchange TRA
Party, Holdings becomes an entity that is disregarded as separate from its owner for tax purposes)
or under Sections 734(b), 743(b) and 754 of the Code (in situations where, following an Exchange by
such TRA Party, Holdings remains in existence as an entity for U.S. federal income tax purposes)
and, in each case, comparable sections of state and local tax laws, as a result of an Exchange by
such TRA Party and the payments made by the Corporate

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Taxpayer in respect of such TRA Party
pursuant to this Agreement. For the avoidance of doubt, the amount of any Exchange Basis
Adjustment resulting from an Exchange of one or more Units shall be determined without regard to
any Pre-Exchange Transfer of such Units and as if any such Pre-Exchange Transfer had not occurred.

          “Exchange Basis Schedule” is defined in Section 2.1 of this Agreement.

          “Exchange Date” means the date of any Exchange.

          “Exchange Reference Asset” in respect of a TRA Party means an asset that is held by
Holdings, or by any of its direct or indirect subsidiaries treated as a partnership or disregarded
entity for purposes of the applicable Tax, at the time of an Exchange by such TRA Party. An
Exchange Reference Asset also includes any asset that is “substituted basis property” under Section
7701(a)(42) of the Code with respect to an Exchange Reference Asset.

          “Expert” is defined in Section 7.9 of this Agreement.

          “Hypothetical Tax Liability” in respect of a TRA Party means, with respect to any
Taxable Year, the liability for Taxes of, without duplication, (i) any Consolidated Group and the
Corporate Taxpayer and (ii) Holdings, but only with respect to the Corporate Taxpayer’s and any
other Consolidated Group members’ proportionate share of the Taxes imposed on Holdings, in each
case using the same methods, elections, conventions and similar practices used on the relevant
Corporate Taxpayer Return, but (i) using the Non-Stepped Up Tax Basis in respect of such TRA Party
(as reflected on the applicable Exchange Basis Schedule including amendments thereto for the
Taxable Year) and (ii) excluding any deduction attributable to Imputed Interest in respect of such
TRA Party for the Taxable Year. For the avoidance of doubt, Hypothetical Tax Liability shall be
determined without taking into account the carryover or carryback of any Tax item (or portions
thereof) that is attributable to the Exchange Basis Adjustment or Imputed Interest, as applicable.

          “Imputed Interest” in respect of a TRA Party shall mean any interest imputed under
Section 1272, 1274 or 483 or other provision of the Code and any similar provision of state and
local tax law with respect to the Corporate Taxpayer’s payment obligations in respect of such TRA
Party under this Agreement.

          “IPO” means the initial public offering of Class A Shares by the Corporate Taxpayer.

          “IPO Date” means the date of the IPO.

          “IRS” means the United States Internal Revenue Service.

          “LIBOR” means during any period, an interest rate per annum equal to the one-year
LIBOR reported, on the date two days prior to the first day of such period, on the Telerate Page
3750 (or if such screen shall cease to be publicly available, as reported on Reuters Screen page
“LIBOR01” or by any other publicly available source of such market rate) for London interbank
offered rates for United States dollar deposits for such period.

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          “LLC Agreement” means, with respect to Holdings, the Third Amended and Restated
Limited Liability Company Agreement of Holdings, dated on or about the date hereof, as amended from
time to time.

          “Market Value” shall mean the closing price of the Class A Shares on the applicable
Exchange Date on the national securities exchange or interdealer quotation system on which such
Class A Shares are then traded or listed, as reported by the Wall Street Journal; provided,
that if the closing price is not reported by the Wall Street Journal for the applicable Exchange
Date, then the Market Value shall mean the closing price of the Class A Shares on the Business Day
immediately preceding such Exchange Date on the national securities exchange or interdealer
quotation system on which such Class A Shares are then traded or listed, as reported by the Wall
Street Journal; provided, further, that if the Class A Shares are not then listed
on a national securities exchange or interdealer quotation system, “Market Value” shall mean the
cash consideration paid for Class A Shares, or the fair market value of the other property
delivered for Class A Shares, as determined by the Board in good faith.

          “Material Objection Notice” has the meaning set forth in Section 4.2 of this
Agreement.

          “Non-Stepped Up Tax Basis” in respect of any TRA Party means, with respect to any
Exchange Reference Asset in respect of such TRA Party at any time, the Tax basis that such asset
would have had at such time if no Exchange Basis Adjustments in respect of such TRA Party had been
made.

          “Objection Notice” has the meaning set forth in Section 2.3(a) of this Agreement.

          “Payment Date” means any date on which a payment is required to be made pursuant to
this Agreement.

          “Person” means any individual, corporation, firm, partnership, joint venture, limited
liability company, estate, trust, business association, organization, governmental entity or other
entity.

          “Pre-Exchange Transfer” means any transfer (including upon the death of a Member) or
distribution in respect of one or more Units (i) that occurs prior to an Exchange of such Units,
and (ii) to which Section 743(b) of the Code applies.

          “Realized Tax Benefit” in respect of a TRA Party means, for a Taxable Year, the
excess, if any, of the Hypothetical Tax Liability in respect of such TRA Party over the actual
liability for Taxes of, without duplication, (i) any Consolidated Group and the Corporate Taxpayer
and (ii) Holdings, but only with respect to the Corporate Taxpayer’s and any other Consolidated
Group members’ proportionate share of the Taxes imposed on Holdings. If all or a portion of the
actual liability for such Taxes for the Taxable Year arises as a result of an audit by a Taxing
Authority of any Taxable Year, such liability shall not be included in determining the Realized Tax
Benefit unless and until there has been a Determination.

          “Realized Tax Detriment” in respect of a TRA Party means, for a Taxable Year, the
excess, if any, of the actual liability for Taxes of, without duplication, (i) any Consolidated

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Group and the Corporate Taxpayer and (ii) Holdings, but only with respect to the Corporate
Taxpayer’s and any other Consolidated Group members’ proportionate share of the Taxes imposed on
Holdings, over the Hypothetical Tax Liability in respect of such TRA Party for such Taxable Year.
If all or a portion of the actual liability for such Taxes for the Taxable Year arises as a result
of an audit by a Taxing Authority of any Taxable Year, such liability shall not be included in
determining the Realized Tax Detriment unless and until there has been a Determination.

          “Reconciliation Dispute” has the meaning set forth in Section 7.9 of this Agreement.

          “Reconciliation Procedures” has the meaning set forth in Section 2.3(a) of this
Agreement.

          “Schedule” means any of the following: (i) an Exchange Basis Schedule, (ii) a Tax
Benefit Schedule, or (iii) the Early Termination Schedule.

          “Senior Obligations” is defined in Section 5.1 of this Agreement.

          “Subsidiaries” means, with respect to any Person, as of any date of determination, any
other Person as to which such Person, owns, directly or indirectly, or otherwise controls more than
50% of the voting power or other similar interests or the sole general partner interest or managing
member or similar interest of such Person.

          “Tax Benefit Payment” is defined in Section 3.1(b) of this Agreement.

          “Tax Benefit Schedule” is defined in Section 2.2 of this Agreement.

          “Tax Return” means any return, declaration, report or similar statement required to be
filed with respect to Taxes (including any attached schedules), including, without limitation, any
information return, claim for refund, amended return and declaration of estimated Tax.

          “Taxable Year” means a taxable year of the Corporate Taxpayer as defined in Section
441(b) of the Code or comparable section of state or local tax law, as applicable (and, therefore,
for the avoidance of doubt, may include a period of less than 12 months for which a Tax Return is
made), ending on or after the IPO Date.

          “Taxes” means any and all United States federal, state, local and foreign taxes,
assessments or similar charges that are based on or measured with respect to net income or profits,
and any interest related to such Tax.

          “Taxing Authority” shall mean any domestic, federal, national, state, county or
municipal or other local government, any subdivision, agency, commission or authority thereof, or
any quasi-governmental body exercising any taxing authority or any other authority exercising Tax
regulatory authority.

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          “Treasury Regulations” means the final, temporary and proposed regulations under the
Code promulgated from time to time (including corresponding provisions and succeeding provisions)
as in effect for the relevant taxable period.

          “Units” is defined in the Recitals of this Agreement.

          “Valuation Assumptions” in respect of a TRA Party shall mean, as of an Early
Termination Date, the assumptions that: (1) in each Taxable Year ending on or after such Early
Termination Date, each Consolidated Group and the Corporate Taxpayer will have taxable income
sufficient to fully utilize the deductions arising from the Exchange Basis Adjustments and the
Imputed Interest in respect of such TRA Party during such Taxable Year or future Taxable Years
(including, as applicable and for the avoidance of doubt, Exchange Basis Adjustments and Imputed
Interest that would result from future Tax Benefit Payments that would be paid in accordance with
the Valuation Assumptions) in which such deductions would become available; (2) the United States
federal income tax rates and state and local income tax rates that will be in effect for each such
Taxable Year will be those specified for each such Taxable Year by the Code and other law as in
effect on the Early Termination Date; (3) any loss carryovers generated by any Exchange Basis
Adjustments or Imputed Interest in respect of such TRA Party and available as of the date of the
Early Termination Schedule will be utilized by the Corporate Taxpayer on a pro rata basis from the
date of the Early Termination Schedule through the scheduled expiration date of such loss
carryovers; (4) any non-amortizable assets will be disposed of (A) with respect to short-term
investments, after 12 months and (B) with respect to all other non-amortizable assets, on the
fifteenth anniversary of the relevant Exchange Basis Adjustment, provided, that in the
event of a Change of Control, such non-amortizable assets shall be deemed disposed of at the
earlier of (i) the time of sale of the relevant asset or (ii) as generally provided in this
Valuation Assumption (4); and (5) if, at the Early Termination Date, there are Units held by such
TRA Party that have not been Exchanged, then each such Unit shall be deemed to be Exchanged for the
Market Value of the Class A Shares and the amount of cash that would be transferred if the Exchange
occurred on the Early Termination Date.

ARTICLE II

DETERMINATION OF CERTAIN REALIZED TAX BENEFIT

          Section 2.1 Exchange Basis Adjustments. Within 120 calendar days after the filing of
the United States federal income tax return of the Corporate Taxpayer or the United States federal
Consolidated Group, as the case may be, for each Taxable Year in which any Exchange has been
effected by any TRA Party, the Corporate Taxpayer shall deliver to the TRA Party a schedule (the
“Exchange Basis Schedule”) that shows, in reasonable detail necessary to perform the
calculations required by this Agreement (i) the Non-Stepped Up Tax Basis in respect of such TRA
Party of the Exchange Reference Assets in respect of such TRA Party as of each applicable Exchange
Date, (ii) the Exchange Basis Adjustment in respect of such TRA Party with respect to the Exchange
Reference Assets in respect of such TRA Party as a result of the Exchanges effected in such Taxable
Year by such TRA Party, calculated in the aggregate, (iii) the period (or periods) over which the
Exchange Reference Assets in respect of such TRA Party

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are amortizable and/or depreciable and (iv)
the period (or periods) over which each Exchange Basis Adjustment in respect of such TRA Party is
amortizable and/or depreciable.

          Section 2.2 Tax Benefit Schedule.

          (a) Tax Benefit Schedule. In respect of each TRA Party, within 120 calendar days
after the filing of the United States federal income tax return of the Corporate Taxpayer or the
United States federal Consolidated Group, as the case may be, for any Taxable Year in which there
is a Realized Tax Benefit or Realized Tax Detriment in respect of such TRA Party, the Corporate
Taxpayer shall provide to such TRA Party a schedule showing, in reasonable detail the calculation
of the Realized Tax Benefit or Realized Tax Detriment in respect of such TRA Party for such Taxable
Year (a “Tax Benefit Schedule”). Each Tax Benefit Schedule will become final as provided
in Section 2.3(a) and may be amended as provided in Section 2.3(b) (subject to the procedures set
forth in Section 2.3(b)).

          (b) Applicable Principles. Subject to Section 3.3(a), the Realized Tax Benefit or
Realized Tax Detriment in respect of each TRA Party for each Taxable Year is intended to measure
the decrease or increase in the actual liability for Taxes of, without duplication, each of the
Consolidated Group and the Corporate Taxpayer, as the case may be, for such Taxable Year
attributable to the Exchange Basis Adjustments and Imputed Interest, as applicable, determined
using a “with and without” methodology. For the avoidance of doubt, the actual liability for Taxes
will take into account the deduction of the portion of the Tax Benefit Payment that must be
accounted for as interest under the Code based upon the characterization of Tax Benefit Payments as
additional consideration payable by the Corporate Taxpayer for the Units acquired in an Exchange or
for the Units or other assets acquired in connection with the IPO Transactions, as the case may be.
Carryovers or carrybacks of any Tax item attributable to the Exchange Basis Adjustments and
Imputed Interest, as applicable, shall be considered to be subject to the rules of the Code and the
Treasury Regulations or the appropriate provisions of U.S. state and local income and franchise tax
law, as applicable, governing the use, limitation and expiration of carryovers or carrybacks of the
relevant type. If a carryover or carryback of any Tax item includes a portion that is attributable
to the Exchange Basis Adjustments or Imputed Interest, as applicable, and another portion that is
not, such portions shall be considered to be used in accordance with the “with and without”
methodology. The parties agree that (i) all Tax Benefit Payments in respect of a TRA Party
attributable to the Exchange Basis Adjustments in respect of such TRA Party (other than amounts
accounted for as interest under the Code) will (A) be treated as subsequent upward purchase price
adjustments and (B) have the effect of creating additional Exchange Basis Adjustments in respect of
such TRA Party to Exchange Reference Assets in respect of such TRA Party in the year of payment,
and (ii) as a result, such additional Exchange Basis Adjustments in respect of such TRA Party will
be incorporated into the current year calculation and into future year calculations, as
appropriate.

          Section 2.3 Procedures, Amendments.

          (a) Procedure. Every time the Corporate Taxpayer delivers to a TRA Party an
applicable Schedule under this Agreement, including any Amended Schedule delivered pursuant to
Section 2.3(b), but excluding any Early Termination Schedule or amended Early Termination Schedule,
the Corporate Taxpayer shall also (i) deliver to such TRA Party schedules

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and work papers, as
determined by the Corporate Taxpayer or requested by such TRA Party, providing reasonable detail
regarding the preparation of the Schedule and (ii) allow such TRA Party reasonable access at no
cost to the appropriate representatives at the Corporate Taxpayer, as determined by the Corporate
Taxpayer or requested by such TRA Party, in connection with a review of such Schedule. Without
limiting the application of the preceding sentence, each time the Corporate Taxpayer delivers to a
TRA Party a Tax Benefit Schedule, in addition to the Tax Benefit Schedule duly completed, the
Corporate Taxpayer shall deliver to such TRA Party the Corporate Taxpayer Return, the reasonably
detailed calculation by the Corporate Taxpayer of the applicable Hypothetical Tax Liability in
respect of such TRA Party, the reasonably detailed calculation by the Corporate Taxpayer of the
actual Tax liability, as well as any other work papers as determined by the Corporate Taxpayer or
requested by such TRA Party. An applicable Schedule or amendment thereto shall become final and
binding on all parties 30 calendar days from the first date on which the TRA Party has received the
applicable Schedule or amendment thereto unless such TRA Party (A) within 30 calendar days after
receiving an applicable Schedule or amendment thereto, provides the Corporate Taxpayer with notice
of a material objection to such Schedule (“Objection Notice”) made in good faith or (B)
provides a written waiver of such right of any Objection Notice within the period described in
clause (A) above, in which case such Schedule or amendment thereto becomes binding on the date the
waiver is received by the Corporate Taxpayer. If the Corporate Taxpayer and any objecting TRA
Party, for any reason, are unable to successfully resolve the issues raised in the Objection Notice
within 30 calendar days after receipt by the Corporate Taxpayer of an Objection Notice, the
Corporate Taxpayer and such TRA Party shall employ the reconciliation procedures as described in
Section 7.9 of this Agreement (the “Reconciliation Procedures”).

          (b) Amended Schedule. In respect of each TRA Party, the applicable Schedule for any
Taxable Year may be amended from time to time by the Corporate Taxpayer (i) in connection with a
Determination affecting such Schedule, (ii) to correct inaccuracies in the Schedule identified as a
result of the receipt of additional factual information relating to a Taxable Year after the date
the Schedule was provided to such TRA Party, (iii) to comply with the Expert’s determination under
the Reconciliation Procedures, (iv) to reflect a change in the Realized Tax Benefit or Realized Tax
Detriment in respect of such TRA Party for such Taxable Year attributable to a carryback or
carryforward of a loss or other tax item to such Taxable Year, (v) to reflect a change in the
Realized Tax Benefit or Realized Tax Detriment in respect of such TRA Party for such Taxable Year
attributable to an amended Tax Return filed for such Taxable Year, or (vi) to adjust an applicable
Exchange Basis Schedule to take into account payments made pursuant to this Agreement (any such
Schedule, an “Amended Schedule”).

ARTICLE III

TAX BENEFIT PAYMENTS

          Section 3.1 Payments.

          (a) Payments. In respect of each TRA Party, within five (5) calendar days after a Tax
Benefit Schedule delivered to such TRA Party becomes final in accordance with Section 2.3(a), the
Corporate Taxpayer shall pay to such TRA Party for such Taxable Year the Tax Benefit Payment in
respect of such TRA Party determined pursuant to Section 3.1(b). Each

10

 

such Tax Benefit Payment
shall be made by wire transfer of immediately available funds to the bank account previously
designated by such TRA Party to the Corporate Taxpayer or as otherwise agreed by the Corporate
Taxpayer and such TRA Party. For the avoidance of doubt, no Tax Benefit Payment shall be made in
respect of estimated tax payments, including, without limitation, federal estimated income tax
payments. Notwithstanding anything herein to the contrary, in no event shall the aggregate Tax
Benefit Payments (other than amounts accounted for as interest under the Code) in respect of any
Exchange exceed 50% of the purchase price for the Units exchanged.

          (b) A “Tax Benefit Payment” in respect of a TRA Party means an amount, not less than
zero, equal to the sum of the Net Tax Benefit attributable to such TRA Party and the Interest
Amount. For the avoidance of doubt, for Tax purposes, the Interest Amount shall not be treated as
interest but instead shall be treated as additional consideration for the acquisition of Units or
other assets in Exchanges unless otherwise required by law. Subject to Section 3.3(a), the
“Net Tax Benefit” attributable to a TRA Party for a Taxable Year shall be an amount equal
to the excess, if any, of 85% of the Cumulative Net Realized Tax Benefit in respect of such TRA
Party as of the end of such Taxable Year over the total amount of payments previously made under
this Section 3.1 in respect of such TRA Party (excluding payments attributable to Interest
Amounts); provided, for the avoidance of doubt, that no such recipient shall be required to
return any portion of any previously made Tax Benefit Payment. The “Interest Amount” shall
equal the interest on the Net Tax Benefit calculated at the Agreed Rate from the due date (without
extensions) for filing the Corporate Taxpayer Return with respect to Taxes for such Taxable Year
until the Payment Date. Notwithstanding the foregoing, for each Taxable Year ending on or after
the date of a Change of Control, all Tax Benefit Payments in respect of a TRA Party (whether paid
with respect to Units that were Exchanged (i) prior to the date of such Change of Control or (ii)
on or after the date of such Change of Control) shall be calculated by utilizing Valuation
Assumptions (1), (3), and (4) in respect of such TRA Party, substituting in each case the terms
“the closing date of a Change of Control” for an “Early Termination Date.”

          Section 3.2 No Duplicative Payments. It is intended that the provisions of this
Agreement will not result in duplicative payment of any amount (including interest) required under
this Agreement. The provisions of this Agreement shall be construed in the appropriate manner to
ensure such intentions are realized.

          Section 3.3 Pro Rata Payments; Coordination of Benefits.

          (a) Notwithstanding anything in Section 3.1 to the contrary, to the extent that the aggregate
tax benefit of the Corporate Taxpayer or any Consolidated Group’s deduction with respect to the
Exchange Basis Adjustments or Imputed Interest in respect of all TRA Parties under this Agreement
is limited in a particular Taxable Year because the Corporate Taxpayer or applicable Consolidated
Group does not have sufficient taxable income, the limitation on the tax benefit for the Corporate
Taxpayer or the applicable Consolidated Group shall be allocated among the TRA Parties in
proportion to the respective amounts of Realized Tax Benefits that would have been determined under
this Agreement in respect of each TRA Party if the Corporate Taxpayer or applicable Consolidated
Group had sufficient taxable income so that there were no such limitation.

11

 

          (b) If for any reason the Corporate Taxpayer does not fully satisfy its payment obligations to
make all Tax Benefit Payments due under this Agreement in respect of a particular Taxable Year,
then the Corporate Taxpayer and the TRA Parties agree that (i) the Corporate Taxpayer shall pay the
same proportion of each Tax Benefit Payment due under this Agreement in respect of such Taxable
Year, without favoring one obligation over the other, and (ii) no Tax Benefit Payment shall be made
in respect of any Taxable Year until all Tax Benefit Payments in respect of prior Taxable Years
have been made in full.

ARTICLE IV

TERMINATION

          Section 4.1 Early Termination and Breach of Agreement.

          (a) The Corporate Taxpayer may terminate this Agreement with respect to all amounts payable to
the TRA Parties and with respect to all of the Units held by TRA Parties at any time by paying to
each TRA Party the Early Termination Payment in respect of such TRA Party; provided,
however, that this Agreement shall only terminate upon the receipt of the Early Termination
Payment by the TRA Parties, and provided, further, that the Corporate Taxpayer may
withdraw any notice to execute its termination rights under this Section 4.1(a) prior to the time
at which any Early Termination Payment has been paid. Upon payment of the Early Termination
Payments by the Corporate Taxpayer, none of the TRA Parties or the Corporate Taxpayer shall have
any further payment obligations under this Agreement, other than for any (i) Tax Benefit Payment
agreed to by the Corporate Taxpayer, on the one hand, and the TRA Party, on the other, as due and
payable but unpaid as of the Early Termination Notice and (ii) Tax Benefit Payment due for the
Taxable Year ending with or including the date of the Early Termination Notice (except to the
extent that the amount described in clause (ii) is included in the Early Termination Payment). If
an Exchange occurs after the Corporate Taxpayer exercises its termination rights under this Section
4.1(a), the Corporate Taxpayer shall have no obligations under this Agreement with respect to such
Exchange.

          (b) In the event that the Corporate Taxpayer breaches any of its material obligations under
this Agreement, whether as a result of failure to make any payment when due, failure to honor any
other material obligation required hereunder or by operation of law as a result of the rejection of
this Agreement in a case commenced under the Bankruptcy Code or otherwise, then all obligations
hereunder shall be accelerated and such obligations shall be calculated as if an Early Termination
Notice had been delivered on the date of such breach and shall include, but not be limited to, (i)
Early Termination Payments calculated as if an Early Termination Notice had been delivered on the
date of a breach, (ii) any Tax Benefit Payment in respect of a TRA Party agreed to by the Corporate
Taxpayer and such TRA Party as due and payable but unpaid as of the date of a breach, and (iii) any
Tax Benefit Payment in respect of any TRA Party due for the Taxable Year ending with or including
the date of a breach. Notwithstanding the foregoing, in the event that the Corporate Taxpayer
breaches this Agreement, each TRA Party shall be entitled to elect to receive the amounts set forth
in clauses (i), (ii) and (iii) above or to seek specific performance of the terms hereof. The
parties agree that the failure to make any payment due pursuant to this Agreement within three
months of the date such payment is due shall be deemed to be a breach of a material obligation
under this

12

 

Agreement for all purposes of this Agreement, and that it will not be considered to be a
breach of a material obligation under this Agreement to make a payment due pursuant to this
Agreement within three months of the date such payment is due.

          Section 4.2 Early Termination Notice. If the Corporate Taxpayer chooses to exercise
its right of early termination under Section 4.1 above, the Corporate Taxpayer shall deliver to
each TRA Party notice of such intention to exercise such right (“Early Termination Notice”)
and a schedule (the “Early Termination Schedule”) showing in reasonable detail the
calculation of the Early Termination Payment(s) due such TRA Party. Each Early Termination Schedule
shall become final and binding on all parties 30 calendar days from the first date on which the TRA
Party has received such Schedule or amendment thereto unless the TRA Party (i) within 30 calendar
days after receiving the Early Termination Schedule, provides the Corporate Taxpayer with notice of
a material objection to such Schedule made in good faith (“Material Objection Notice”) or
(ii) provides a written waiver of such right of a Material Objection Notice within the period
described in clause (i) above, in which case such Schedule becomes binding on the date the waiver
is received by the Corporate Taxpayer (the “Early Termination Effective Date”). If the
Corporate Taxpayer and the TRA Party are, for any reason, unable to successfully resolve the issues
raised in such notice within 30 calendar days after receipt by the Corporate Taxpayer of the
Material Objection Notice, the Corporate Taxpayer and the objecting TRA Party shall employ the
Reconciliation Procedures. All Early Termination Schedules affected by any changes resulting from
a Material Objection Notice shall be updated and the Early Termination Payment(s) due in respect
thereof shall be recalculated by the Corporate Taxpayer to take into account such changes.

          Section 4.3 Payment upon Early Termination.

          (a) Within three calendar days after an Early Termination Effective Date, the Corporate
Taxpayer shall pay to each TRA Party an amount equal to the Early Termination Payment in respect of
such TRA Party. Such payment shall be made by wire transfer of immediately available funds to a
bank account or accounts designated by the TRA Party or as otherwise agreed by the Corporate
Taxpayer and such TRA Party.

          (b) “Early Termination Payment” in respect of a TRA Party shall equal the present
value, discounted at the Early Termination Rate as of the applicable Early Termination Effective
Date, of all Tax Benefit Payments in respect of such TRA Party that would be required to be paid by
the Corporate Taxpayer beginning from the Early Termination Date and assuming that the Valuation
Assumptions in respect of such TRA Party are applied.

ARTICLE V

SUBORDINATION AND LATE PAYMENTS

          Section 5.1 Subordination. Notwithstanding any other provision of this Agreement to
the contrary, any Tax Benefit Payment or Early Termination Payment required to be made by the
Corporate Taxpayer to the TRA Parties under this Agreement shall rank

13

 

subordinate and junior in
right of payment to any principal, interest or other amounts due and payable in respect of any
obligations in respect of indebtedness for borrowed money of the Corporate Taxpayer and its
Subsidiaries (“Senior Obligations”) and shall rank pari passu with all current or future
unsecured obligations of the Corporate Taxpayer that are not Senior Obligations.

          Section 5.2 Late Payments by the Corporate Taxpayer. The amount of all or any
portion of any Tax Benefit Payment or Early Termination Payment not made to the TRA Parties when
due under the terms of this Agreement shall be payable together with any interest thereon, computed
at the Default Rate and commencing from the date on which such Tax Benefit Payment or Early
Termination Payment was due and payable.

ARTICLE VI

NO DISPUTES; CONSISTENCY; COOPERATION

          Section 6.1 Participation in the Corporate Taxpayer’s and Holdings’ Tax Matters.
Except as otherwise provided herein, the Corporate Taxpayer shall have full responsibility for, and
sole discretion over, all Tax matters concerning each Consolidated Group, the Corporate Taxpayer
and Holdings, including without limitation the preparation, filing or amending of any Tax Return
and defending, contesting or settling any issue pertaining to Taxes. Notwithstanding the
foregoing, the Corporate Taxpayer shall notify a TRA Party of, and keep the TRA Party reasonably
informed with respect to, the portion of any audit of any Consolidated Group, the Corporate
Taxpayer or Holdings by a Taxing Authority the outcome of which is reasonably expected to affect
the rights and obligations of such TRA Party under this Agreement, and shall provide to each such
TRA Party reasonable opportunity to provide information and other input to the Corporate Taxpayer,
Holdings and their respective advisors concerning the conduct of any such portion of such audit;
provided, however, that the Corporate Taxpayer and Holdings shall not be required
to take any action that is inconsistent with any provision of the LLC Agreement.

          Section 6.2 Consistency. the Corporate Taxpayer and the TRA Parties agree to report
and cause to be reported for all purposes, including federal, state and local Tax purposes and
financial reporting purposes, all Tax-related items (including, without limitation, the Exchange
Basis Adjustments and each Tax Benefit Payment) in a manner consistent with that specified by the
Corporate Taxpayer in any Schedule required to be provided by or on behalf of the Corporate
Taxpayer under this Agreement unless otherwise required by law.

          Section 6.3 Cooperation. Each of the TRA Parties shall (a) furnish to the Corporate
Taxpayer in a timely manner such information, documents and other materials as the Corporate
Taxpayer may reasonably request for purposes of making any determination or computation necessary
or appropriate under this Agreement, preparing any Tax Return or contesting or defending any audit,
examination or controversy with any Taxing Authority, (b) make itself available to the Corporate
Taxpayer and its representatives to provide explanations of documents and materials and such other
information as the Corporate Taxpayer or its representatives may reasonably request in connection
with any of the matters described in clause (a) above, and (c) reasonably cooperate in connection
with any such matter, and the Corporate

14

 

Taxpayer shall reimburse each such TRA Party for any
reasonable third-party costs and expenses incurred pursuant to this Section.

ARTICLE VII

MISCELLANEOUS

          Section 7.1 Notices. All notices, requests, claims, demands and other communications
hereunder shall be in writing and shall be deemed duly given and received (a) on the date of
delivery if delivered personally, or by facsimile upon confirmation of transmission by the sender’s
fax machine if sent on a Business Day (or otherwise on the next Business Day) or (b) on the first
Business Day following the date of dispatch if delivered by a recognized next-day courier service.
All notices hereunder shall be delivered as set forth below, or pursuant to such other instructions
as may be designated in writing by the party to receive such notice:

If to the Corporate Taxpayer, to:

FXCM Inc.

32 Old Slip

New York, New York 10005

Attention: Chief Financial Officer

Facsimile: (212) 897-7662

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

Simpson Thacher & Bartlett LLP

425 Lexington Avenue

New York, New York 10017

Attention: Joshua Ford Bonnie

Facsimile: (212) 455-2502

If to the TRA Parties, to:

The address and facsimile number set forth in the records of Holdings.

Any party may change its address or fax number by giving the other party written notice of its new
address or fax number in the manner set forth above.

          Section 7.2 Counterparts. This Agreement may be executed in one or more counterparts,
all of which shall be considered one and the same agreement and shall become effective when one or
more counterparts have been signed by each of the parties and delivered to the other parties, it
being understood that all parties need not sign the same counterpart. Delivery of an executed
signature page to this Agreement by facsimile transmission shall be as effective as delivery of a
manually signed counterpart of this Agreement.

15

 

          Section 7.3 Entire Agreement; No Third Party Beneficiaries. This Agreement
constitutes the entire agreement and supersedes all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter hereof. This Agreement shall
be binding upon and inure solely to the benefit of each party hereto and their respective
successors and permitted assigns, and nothing in this Agreement, express or implied, is intended to
or shall confer upon any other Person any right, benefit or remedy of any nature whatsoever under
or by reason of this Agreement.

          Section 7.4 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the law of the State of New York, without regard to the conflicts of laws
principles thereof that would mandate the application of the laws of another jurisdiction.

          Section 7.5 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any law or public policy, all other terms and
provisions of this Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith
to modify this Agreement so as to effect the original intent of the parties as closely as possible
in an acceptable manner in order that the transactions contemplated hereby are consummated as
originally contemplated to the greatest extent possible.

          Section 7.6 Successors; Assignment; Amendments; Waivers.

          (a) Each TRA Party may assign any of its rights under this Agreement to any Person in
accordance with applicable law as long as such transferee has executed and delivered, or, in
connection with such transfer, executes and delivers, a joinder to this Agreement, in form and
substance reasonably satisfactory to the Corporate Taxpayer, agreeing to become a TRA Party, as
applicable, for all purposes of this Agreement, except as otherwise provided in such joinder.

          (b) No provision of this Agreement may be amended unless such amendment is approved in writing
by each of the Corporate Taxpayer and by the TRA Parties who would be entitled to receive at least
two-thirds of the Early Termination Payments payable to all TRA Parties hereunder if the Corporate
Taxpayer had exercised its right of early termination on the date of the most recent Exchange prior
to such amendment (excluding, for purposes of this sentence, all payments made to any TRA Party
pursuant to this Agreement since the date of such most recent Exchange); provided, that no such
amendment shall be effective if such amendment will have a disproportionate effect on the payments
certain TRA Parties will or may receive under this Agreement unless two-thirds of such TRA Parties
so disproportionately affected consent in writing to such amendment. No provision of this Agreement
may be waived unless such waiver is in writing and signed by the party against whom the waiver is
to be effective.

          (c) All of the terms and provisions of this Agreement shall be binding upon, shall inure to
the benefit of and shall be enforceable by the parties hereto and their respective successors,
assigns, heirs, executors, administrators and legal representatives. The Corporate Taxpayer shall
require and cause any direct or indirect successor (whether by purchase, merger,

16

 

consolidation or
otherwise) to all or substantially all of the business or assets of the Corporate Taxpayer, by
written agreement, expressly to assume and agree to perform this Agreement in the same manner and
to the same extent that the Corporate Taxpayer would be required to perform if no such succession
had taken place.

          Section 7.7 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.

          Section 7.8 Resolution of Disputes.

          (a) Any and all disputes which are not governed by Section 7.9 and which cannot be settled
amicably, including any ancillary claims of any party, arising out of, relating to or in connection
with the validity, negotiation, execution, interpretation, performance or non-performance of this
Agreement (including the validity, scope and enforceability of this arbitration provision) (each a
“Dispute”) shall be finally settled by arbitration conducted by a single arbitrator in New
York in accordance with the then-existing Rules of Arbitration of the International Chamber of
Commerce. If the parties to the Dispute fail to agree on the selection of an arbitrator within ten
(10) days of the receipt of the request for arbitration, the International Chamber of Commerce
shall make the appointment. The arbitrator shall be a lawyer admitted to the practice of law in
the State of New York and shall conduct the proceedings in the English language. Performance under
this Agreement shall continue if reasonably possible during any arbitration proceedings.

          (b) Notwithstanding the provisions of paragraph (a), the Corporate Taxpayer may bring an
action or special proceeding in any court of competent jurisdiction for the purpose of compelling a
party to arbitrate, seeking temporary or preliminary relief in aid of an arbitration hereunder,
and/or enforcing an arbitration award and, for the purposes of this paragraph (b), the TRA Party
(i) expressly consents to the application of paragraph (c) of this Section 7.8 to any such action
or proceeding, (ii) agrees that proof shall not be required that monetary damages for breach of the
provisions of this Agreement would be difficult to calculate and that remedies at law would be
inadequate, and (iii) irrevocably appoints the Corporate Taxpayer as agent of the TRA Party for
service of process in connection with any such action or proceeding and agrees that service of
process upon such agent, who shall promptly advise the TRA Party, as applicable, of any such
service of process, shall be deemed in every respect effective service of process upon the TRA
Party in any such action or proceeding.

          (c) (i) EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF COURTS LOCATED IN NEW
YORK, NEW YORK FOR THE PURPOSE OF ANY JUDICIAL PROCEEDING BROUGHT IN ACCORDANCE WITH THE PROVISIONS
OF THIS SECTION 7.8, OR ANY JUDICIAL PROCEEDING ANCILLARY TO AN ARBITRATION OR CONTEMPLATED
ARBITRATION ARISING OUT OF OR RELATING TO OR CONCERNING THIS AGREEMENT. Such ancillary judicial
proceedings include any suit, action or proceeding to compel arbitration, to obtain temporary or
preliminary judicial relief in aid of arbitration, or to confirm an arbitration award. The parties
acknowledge that the fora designated by this paragraph (c) have a reasonable relation to this
Agreement, and to the parties’ relationship with one another; and

17

 

               (ii) The parties hereby waive, to the fullest extent permitted by applicable law, any
objection which they now or hereafter may have to personal jurisdiction or to the laying of venue
of any such ancillary suit, action or proceeding brought in any court referred to in the preceding
paragraph of this Section 7.8 and such parties agree not to plead or claim the same.

          Section 7.9 Reconciliation. In the event that the Corporate Taxpayer and a TRA Party
are unable to resolve a disagreement with respect to the matters governed by Sections 2.3, 4.2 and
6.2 within the relevant period designated in this Agreement (“Reconciliation Dispute”), the
Reconciliation Dispute shall be submitted for determination to a nationally recognized expert (the
“Expert”) in the particular area of disagreement mutually acceptable to both parties. The
Expert shall be a partner or principal in a nationally recognized accounting or law firm, and
unless the TRA Party agrees otherwise, the Expert shall not, and the firm that employs the Expert
shall not, have any material relationship with the Corporate Taxpayer or the TRA Party or other
actual or potential conflict of interest. If the Corporate Taxpayer and TRA Party are unable to
agree on an Expert within fifteen (15) days of receipt by the respondent(s) of written notice of a
Reconciliation Dispute, the Expert shall be appointed by the International Chamber of Commerce
Centre for Expertise. The Expert shall resolve any matter relating to the Exchange Basis Schedule
or an amendment thereto or the Early Termination Schedule or an amendment thereto within 30
calendar days and shall resolve any matter relating to a Tax Benefit Schedule or an amendment
thereto within 15 calendar days or as soon thereafter as is reasonably practicable, in each case
after the matter has been submitted to the Expert for resolution. Notwithstanding the preceding
sentence, if the matter is not resolved before any payment that is the subject of a disagreement
would be due (in the absence of such disagreement) or any Tax Return reflecting the subject of a
disagreement is due, the undisputed amount shall be paid on the date prescribed by this Agreement
and such Tax Return may be filed as prepared by the Corporate Taxpayer, subject to adjustment or
amendment upon resolution. The costs and expenses relating to the engagement of such Expert or
amending any Tax Return shall be borne by the Corporate Taxpayer except as provided in the next
sentence. The Corporate Taxpayer and the TRA Party shall bear their own costs and expenses of such
proceeding, unless (i) the Expert adopts the TRA Party’s position, in which case the Corporate
Taxpayer shall reimburse the TRA Party for any reasonable out-of-pocket costs and expenses in such
proceeding, or (ii) the Expert adopts the Corporate Taxpayer’s position, in which case the TRA
Party shall reimburse the Corporate Taxpayer for any reasonable out-of-pocket costs and expenses in
such proceeding. Any dispute as to whether a dispute is a Reconciliation Dispute within the
meaning of this Section 7.9 shall be decided by the Expert. The Expert shall finally determine any
Reconciliation Dispute and the determinations of the Expert pursuant to this Section 7.9 shall be
binding on the Corporate Taxpayer and the TRA Party and may be entered and enforced in any court
having jurisdiction.

          Section 7.10 Withholding. The Corporate Taxpayer shall be entitled to deduct and
withhold from any payment payable pursuant to this Agreement such amounts as the Corporate Taxpayer
is required to deduct and withhold with respect to the making of such payment under the Code or any
provision of state, local or foreign tax law. To the extent that amounts are so withheld and paid
over to the appropriate Taxing Authority by the Corporate Taxpayer, such withheld amounts shall be
treated for all purposes of this Agreement as having been paid to the Person in respect of whom
such withholding was made.

18

 

          Section 7.11 Admission of the Corporate Taxpayer into a Consolidated Group; Transfers of
Corporate Assets.

          (a) If the Corporate Taxpayer is or becomes a member of an affiliated or consolidated group of
corporations that files a consolidated income tax return pursuant to Sections 1501 et seq. of the
Code or any corresponding provisions of state or local law, then: (i) the provisions of this
Agreement shall be applied with respect to the group as a whole; and (ii) Tax Benefit Payments,
Early Termination Payments and other applicable items hereunder shall be computed with reference to
the consolidated taxable income of the group as a whole.

          (b) If any entity that is obligated to make a Tax Benefit Payment or Early Termination Payment
hereunder transfers one or more assets to a corporation (or a Person classified as a corporation
for U.S. income tax purposes) with which such entity does not file a consolidated tax return
pursuant to Section 1501 of the Code, such entity, for purposes of calculating the amount of any
Tax Benefit Payment or Early Termination Payment (e.g., calculating the gross income of the entity
and determining the Realized Tax Benefit of such entity) due hereunder, shall be treated as having
disposed of such asset in a fully taxable transaction on the date of such contribution. The
consideration deemed to be received by such entity shall be equal to the fair market value of the
contributed asset. For purposes of this Section 7.11, a transfer of a partnership interest shall
be treated as a transfer of the transferring partner’s share of each of the assets and liabilities
of that partnership.

          Section 7.12 Confidentiality.

          (a) Each TRA Party and each of their assignees acknowledge and agree that the information of
the Corporate Taxpayer is confidential and, except in the course of performing any duties as
necessary for the Corporate Taxpayer and its Affiliates, as required by law or legal process or to
enforce the terms of this Agreement, such person shall keep and retain in the strictest confidence
and not disclose to any Person any confidential matters, acquired pursuant to this Agreement, of
the Corporate Taxpayer and its Affiliates and successors, concerning Holdings and its Affiliates
and successors or the Members, learned by the TRA Party heretofore or hereafter. This Section 7.12
shall not apply to (i) any information that has been made publicly available by the Corporate
Taxpayer or any of its Affiliates, becomes public knowledge (except as a result of an act of the
TRA Party in violation of this Agreement) or is generally known to the business community and
(ii) the disclosure of information to the extent necessary for the TRA Party to prepare and file
its Tax Returns, to respond to any inquiries regarding the same from any taxing authority or to
prosecute or defend any action, proceeding or audit by any taxing authority with respect to such
returns. Notwithstanding anything to the contrary herein, each TRA Party and each of their
assignees (and each employee, representative or other agent of the TRA Party or its assignees, as
applicable) may disclose to any and all Persons, without limitation of any kind, the tax treatment
and tax structure of the Corporate Taxpayer, Holdings and their Affiliates, and any of their
transactions, and all materials of any kind (including opinions or other tax analyses) that are
provided to the TRA Party relating to such tax treatment and tax structure.

          (b) If a TRA Party or an assignee thereof commits a breach, or threatens to commit a breach,
of any of the provisions of this Section 7.12, the Corporate Taxpayer shall have the right and
remedy to have the provisions of this Section 7.12 specifically enforced by

19

 

injunctive relief or
otherwise by any court of competent jurisdiction without the need to post any bond or other
security, it being acknowledged and agreed that any such breach or threatened breach shall cause
irreparable injury to the Corporate Taxpayer or any of its Subsidiaries or the TRA Parties and the
accounts and funds managed by the Corporate Taxpayer and that money damages alone shall not provide
an adequate remedy to such Persons. Such rights and remedies shall be in addition to, and not in
lieu of, any other rights and remedies available at law or in equity.

          Section 7.13 Change in Law. Notwithstanding anything herein to the contrary, if, in
connection with an actual or proposed change in law, a TRA Party reasonably believes that the
existence of this Agreement could cause income (other than income arising from receipt of a payment
under this Agreement) recognized by the TRA Party upon any Exchange to be treated as ordinary
income rather than capital gain (or otherwise taxed at ordinary income rates) for United States
federal income tax purposes or would have other material adverse tax consequences to the TRA Party
(a “Change in Tax Law”), then at the election of the TRA Party, and to the extent specified
by the TRA Party, this Agreement (i) shall cease to have further effect with respect to the TRA
Party, (ii) shall not apply to an Exchange by the TRA Party occurring after a date specified by the
TRA Party, or (iii) shall otherwise be amended (with respect to the TRA Party only) in a manner
determined by the TRA Party provided that such amendment shall not result in an increase in
payments under this Agreement at any time as compared to the amounts and times of payments that
would have been due in the absence of such amendment.

          Section 7.14 LLC Agreement. This Agreement shall be treated as part of the partnership
agreement of Holdings as described in Section 761(c) of the Internal Revenue Code of 1986, as
amended, and Sections 1.704-1(b)(2)(ii)(h) and 1.761-1(c) of the Treasury Regulations.

          Section 7.15 Independent Nature of TRA Parties’ Rights and Obligations. The
obligations of each TRA Party hereunder are several and not joint with the obligations of any other
TRA Party, and no TRA Party shall be responsible in any way for the performance of the obligations
of any other TRA Party under hereunder. The decision of each TRA Party to enter into to this
Agreement has been made by such TRA Party independently of any other TRA Party. Nothing contained
herein, and no action taken by any TRA Party pursuant hereto, shall be deemed to constitute the TRA
Parties as a partnership, an association, a joint venture or any other kind of entity, or create a
presumption that the TRA Parties are in any way acting in concert or as a group with respect to
such obligations or the transactions contemplated hereby and the Corporate Taxpayer acknowledges
that the TRA Parties are not acting in concert or as a group, and the Corporate Taxpayer will not
assert any such claim, with respect to such obligations or the transactions contemplated hereby.

          Section 7.16 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

20

 

          IN WITNESS WHEREOF, the Corporate Taxpayer and each TRA Party have duly executed this
Agreement as of the date first written above.

	 	 	 	 	 
	 	FXCM INC.

 	 
	 	By:  	/s/ David S. Sassoon
 	 
	 	 	Name:  	David S. Sassoon 	 
	 	 	Title:  	Secretary and General Counsel 	 
	 
	 	TRA PARTIES

Each TRA Party set forth on Annex A hereto

 	 
	 	By:  	/s/ David S. Sassoon
 	 
	 	 	Name:  	David S. Sassoon 	 
	 	 	Title:  	Attorney-in-fact 	 
	 

[Signature Page — Tax Receivable Agreement]exv10w4

Exhibit 10.4

 

REGISTRATION RIGHTS AGREEMENT

OF

FXCM INC.

Dated as of December 1, 2010

 

 

 

Table of Contents

	 	 	 	 	 
	 	 	 	Page	 
	ARTICLE I
	 	 	 	 
	DEFINITIONS AND OTHER MATTERS
	 	 	 	 
	 
	 	 	 	 
	Section 1.1 Definitions
	 	 	1	 
	Section 1.2 Definitions Generally
	 	 	4	 
	 
	 	 	 	 
	ARTICLE II
	 	 	 	 
	REGISTRATION RIGHTS
	 	 	 	 
	 
	 	 	 	 
	Section 2.1 Exchange Registration
	 	 	5	 
	Section 2.2 Demand Registration
	 	 	5	 
	Section 2.3 Incidental Registration
	 	 	7	 
	Section 2.4 Holdback Agreements
	 	 	8	 
	Section 2.5 Registration Procedures
	 	 	9	 
	Section 2.6 Indemnification by the Company
	 	 	13	 
	Section 2.7 Indemnification by Registering Covered
Persons
	 	 	13	 
	Section 2.8 Conduct of Indemnification Proceedings
	 	 	14	 
	Section 2.9 Contribution
	 	 	15	 
	Section 2.10 Participation in Public Offering
	 	 	15	 
	Section 2.11 Other Indemnification
	 	 	15	 
	Section 2.12 Parties in Interest
	 	 	15	 
	Section 2.13 Acknowledgement Regarding the Company
	 	 	16	 
	Section 2.14 Mergers, Recapitalizations, Exchanges
or Other Transactions Affecting
Registrable Securities
	 	 	16	 
	 
	 	 	 	 
	ARTICLE III
	 	 	 	 
	MISCELLANEOUS
	 	 	 	 
	 
	Section 3.1 Term of the Agreement; Termination of
Certain Provisions
	 	 	16	 
	Section 3.2 Assignment; Successors
	 	 	16	 
	Section 3.3 Governing Law
	 	 	17	 
	Section 3.4 Severability
	 	 	17	 
	Section 3.5 Entire Agreement
	 	 	17	 
	Section 3.6 Successors and Assigns; Certain
Transferees Bound Hereby
	 	 	17	 
	Section 3.7 Counterparts
	 	 	17	 
	Section 3.8 Remedies
	 	 	17	 
	Section 3.9 Notices
	 	 	17	 
	Section 3.10 Governing Law
	 	 	18	 
	Section 3.11 Specific Performance
	 	 	18	 
	Section 3.12 Descriptive Headings
	 	 	19	 
	 
	Appendix A Covered Person Questionnaire
	 	 	 	 

i 

 

REGISTRATION RIGHTS AGREEMENT

          This REGISTRATION RIGHTS AGREEMENT (including Appendix A hereto, as such Appendix A may be
amended from time to time pursuant to the provisions hereof, this “Agreement”), is made and
entered into as of December 1, 2010, by and among FXCM Inc., a Delaware corporation (the
“Company”), and the Covered Persons (defined below) from time to time party hereto.

          WHEREAS, the Covered Persons are holders of Holdings Units (defined below), which, subject to
certain restrictions and requirements, are exchangeable at the option of the holder thereof for
shares of the Company’s Class A common stock, par value $0.01 per share (the “Class A Common
Stock”); and

          WHEREAS, the Company desires to provide the Covered Persons with registration rights with
respect to Class A Common Stock underlying their Holdings Units and certain other shares of Class A
Common Stock they may otherwise hold from time to time.

          NOW, THEREFORE, in consideration of the premises and of the mutual agreements, covenants and
provisions herein contained, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS AND OTHER MATTERS

          Section 1.1 Definitions. Capitalized terms used in this Agreement without other
definition shall, unless expressly stated otherwise, have the meanings specified in this Section
1.1:

     “Beneficial Owner” has the meaning set forth in Rule 13d-3 under the Exchange Act.

     “Board” means the Board of Directors of the Company.

     “Class A Common Stock” has the meaning ascribed to such term in the Recitals.

     “Company” has the meaning ascribed to such term in the preamble.

     “Covered Holdings Units” means, with respect to a Covered Person, such Covered
Person’s Holdings Units.

     “Covered Person” means those persons, other than the Company, who shall from time to
time be parties to this Agreement in accordance with the terms hereof (including Permitted
Transferees).

     “Demand Committee” shall mean (a) Dror (Drew) Niv, for so long as he shall be an
officer of the Company and a holder of Holdings Units or shares of Class A Common Stock, (b) David
Sakhai, for so long as he shall be an officer of the Company and a holder of Holdings Units or
shares of Class A Common Stock and (c) a representative of Long Ridge Equity Partners who shall
initially be James Brown, for so long as persons or entities affiliated with Long Ridge Equity
Partners are, assuming the exchange of all then-outstanding Holdings Units

 

 

owned by persons other than the Company, holders of at least 5% (on a fully diluted basis) of
the then-outstanding shares of Class A Common Stock. At such time as none of Drew Niv, David
Sakhai and a representative of Long Ridge Equity Partners shall continue to be a member of the
Demand Committee pursuant to the immediately preceding sentence the Demand Committee shall consist
of a representative of all Covered Persons that would, assuming the exchange of all
then-outstanding Holdings Units owned by persons other than the Company, hold at least 5% (on a
fully diluted basis) of the then-outstanding shares of Class A Common Stock (which committee may,
for the avoidance of doubt, include Drew Niv or David Sakhai). If at any time none of Drew Niv,
David Sakhai and a representative of Long Ridge Equity Partners shall continue to be a member of
the Demand Committee pursuant to the first sentence of this paragraph and there shall not be any
Covered Person that would, assuming the exchange of all then-outstanding Holdings Units owned by
persons other than the Company, hold at least 5% (on a fully diluted basis) of the then-outstanding
shares of Class A Common Stock, there shall cease to be a Demand Committee and Sections 2.2 and 2.3
hereof shall have no further force or effect. Solely for purposes of the first sentence of this
paragraph, in determining whether persons or entities affiliated with Long Ridge Equity Partners
are, assuming the exchange of all then-outstanding Holdings Units owned by persons other than the
Company, holders of at least 5% (on a fully diluted basis) of the then-outstanding shares of Class
A Common Stock, MFP Partners, L.P., Michel Daher, Charlestone Venture Holdings Limited and Yale
University shall be deemed to be persons or entities affiliated with Long Ridge Equity Partners.

     “Demand Notice” has the meaning ascribed to such term in Section 2.2(a).

     “Demand Registration” has the meaning ascribed to such term in Section 2.2(a).

     “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

     “Exchange Agreement” means the Exchange Agreement, dated as of or about the date
hereof among the Company, Holdings and holders of Holdings Units from time to time party thereto,
as amended from time to time.

     “Exchange Registration” has the meaning ascribed to such term in Section 2.1(a).

     “FINRA” means the Financial Industry Regulatory Authority, Inc.

     “Follow-on Holdback Period” has the meaning ascribed to such term in Section 2.4(a).

     “Governmental Authority” means any national, local or foreign (including U.S. federal,
state or local) or supranational (including European Union) governmental, judicial, administrative
or regulatory (including self-regulatory) agency, commission, department, board, bureau, entity or
authority of competent jurisdiction.

     “Holdback Extension” has the meaning ascribed to such term in Section 2.4(a).

     “Holdings” means FXCM Holdings, LLC, a Delaware limited liability company.

 

 

     “Holdings LLC Agreement” means the Third Amended and Restated Limited Liability
Company Agreement of Holdings dated as of or about the date hereof, as it may be amended,
supplemented or restated from time to time.

     “Holdings Unit” has the meaning given to such term in the Exchange Agreement.

     “Incidental Registration” has the meaning ascribed to such term in Section 2.3(a).

     “Indemnified Parties” has the meaning ascribed to such term in Section 2.6.

     “IPO Holdback Period” has the meaning ascribed to such term in Section 2.4(a).

     “Other Registration Rights” means any securities of the Company proposed to be
included in such registration by the holders of registration rights granted other than pursuant to
this Agreement.

     “Permitted Transferee” means any transferee of a Holdings Unit after the date hereof
the transfer of which was permitted by the Holdings LLC Agreement.

     “Public Offering” means an underwritten public offering pursuant to an effective
registration statement under the Securities Act, other than pursuant to a registration statement on
Form S-4 or Form S-8 or any similar or successor form.

     “Registering Covered Person” has the meaning ascribed to such term in Section 2.5(a).

     “Registrable Securities” means shares of Class A Common Stock that may be delivered in
exchange for Holdings Units and other shares of Class A Common Stock otherwise held by Covered
Persons from time to time. For purposes of this Agreement, Registrable Securities shall cease to be
Registrable Securities when such Registrable Securities (i) are Transferred in a Public Sale, (ii)
are eligible to be sold by the Covered Person owning such Registrable Securities (including
Registrable Securities deliverable to a Covered Person under an effective Exchange Registration)
pursuant to Rule 144(b)(1) under the Securities Act or, in the case of Registrable Securities that
are not “restricted securities” under Rule 144 under the Securities Act, pursuant to Section 4(1)
of the Securities Act (or, in each case, any successor provision then in effect) or (iii) cease to
be outstanding (or issuable upon exchange).

     “Registration Expenses” means any and all expenses incident to the performance of or
compliance with any registration or marketing of securities, including all (i) SEC and securities
exchange registration and filing fees, and all other fees and expenses payable in connection with
the listing of securities on any securities exchange or automated interdealer quotation system,
(ii) fees and expenses of compliance with any securities or “blue sky” laws (including reasonable
fees and disbursements of counsel in connection with “blue sky” qualifications of the securities
registered), (iii) expenses in connection with the preparation, printing, mailing and delivery of
any registration statements, prospectuses and other documents in connection therewith and any
amendments or supplements thereto, (iv) security engraving and printing expenses, (v) internal
expenses of the Company and Holdings (including, without limitation, all salaries and expenses of
the officers and employees of the Company or Holdings performing legal or accounting duties), (vi)
reasonable fees and disbursements of counsel for the Company or Holdings and

 

 

customary fees and expenses for independent certified public accountants retained by the
Company or Holdings (including the expenses relating to any comfort letters or costs associated
with the delivery by independent certified public accountants of any comfort letters requested
pursuant to Section 2.5(i)), (vii) reasonable fees and expenses of any special experts retained by
the Company or Holdings in connection with such registration, (viii) in connection with a
registration pursuant to Sections 2.2 or 2.3, reasonable fees of not more than one counsel for all
of the Covered Persons participating in the offering selected by the Demand Committee, (ix) fees
and expenses in connection with any review by FINRA of the underwriting arrangements or other terms
of the offering, and all fees and expenses of any “qualified independent underwriter,” including
the fees and expenses of any counsel thereto, (x) fees and disbursements of underwriters
customarily paid by issuers or sellers of securities, but excluding any underwriting fees,
discounts and commissions attributable to the sale of Registrable Securities, (xi) costs of
printing and producing any agreements among underwriters, underwriting agreements, any “blue sky”
or legal investment memoranda and any selling agreements and other documents in connection with the
offering, sale or delivery of the Registrable Securities, (xii) transfer agents’ and registrars’
fees and expenses and the fees and expenses of any other agent or trustee appointed in connection
with such offering, (xiii) expenses relating to any analyst or investor presentations or any “road
shows” undertaken in connection with the registration, marketing or selling of the Registrable
Securities, (xiv) fees and expenses payable in connection with any ratings of the Registrable
Securities, including expenses relating to any presentations to rating agencies and (xv) all
out-of-pocket costs and expenses incurred by the Company, Holdings or their appropriate officers in
connection with their compliance with Section 2.5(m).

     “SEC” means the Securities and Exchange Commission.

     “Securities Act” means the U.S. Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

     “Suspension Period” has the meaning ascribed to such term in Section 2.5(k).

          Section 1.2 Definitions Generally. Wherever required by the context of this
Agreement, the singular shall include the plural and vice versa, and the masculine gender shall
include the feminine and neuter genders and vice versa, and references to any agreement, document
or instrument shall be deemed to refer to such agreement, document or instrument as amended,
supplemented or modified from time to time. When used herein:

     (a) the word “or” is not exclusive;

     (b) the words “including,” “includes,” “included” and “include” are deemed to be
followed by the words “without limitation”;

     (c) the terms “herein,” “hereof” and “hereunder” and other words of similar import
refer to this Agreement as a whole and not to any particular section, paragraph or
subdivision;

     (d) the word “person” means any individual, corporation, limited liability company,
trust, joint venture, association, company, partnership or other legal entity or a
government or any department or agency thereof or self-regulatory organization; and

 

 

     (e) all section, paragraph or clause references not attributed to a particular document
shall be references to such parts of this Agreement, and all exhibit, annex and schedule
references not attributed to a particular document shall be references to such exhibits,
annexes and schedules to this Agreement.

ARTICLE II

REGISTRATION RIGHTS

          Section 2.1 Exchange Registration.

     (a) The Company shall use its commercially reasonable efforts to file with the SEC
prior to the time that Holdings Units held by Covered Persons become available for exchange
for Class A Common Stock pursuant to the terms of the Exchange Agreement and cause to be
declared effective under the Securities Act by the SEC promptly thereafter, one or more
registration statements (the “Exchange Registration”) covering (i) the delivery by
the Company from time to time to the Covered Persons of all shares of Class A Common Stock
deliverable to the Covered Persons in exchange for Holdings Units pursuant to the Exchange
Agreement or (ii) if the Company determines that the registration provided for in clause (i)
is not available for any reason, the registration of resale of such shares of Class A Common
Stock by the Covered Persons.

     (b) The Company shall be liable for and pay all Registration Expenses in connection
with any Exchange Registration, regardless of whether such registration is effected.

     (c) Upon notice to each Covered Person, the Company may postpone effecting a
registration pursuant to this Section 2.1 for a reasonable time specified in the notice but
not exceeding 120 days, if (i) the Board shall determine in good faith that effecting the
registration would materially and adversely affect an offering of securities of the Company
the preparation of which had then been commenced or (ii) the Company is in possession of
material non-public information the disclosure of which during the period specified in such
notice the Board believes in good faith would not be in the best interests of the Company.

          Section 2.2 Demand Registration.

     (a) If at any time the Company shall receive a written request (a “Demand
Notice”) from the Demand Committee that the Company effect the registration under the
Securities Act of all or any portion of the Registrable Securities specified in the Demand
Notice (a “Demand Registration”), specifying the information set forth under Section
2.5(j), then the Company shall use its commercially reasonable efforts to effect, as
expeditiously as reasonably practicable, subject to the restrictions in Section 2.2(d), the
registration under the Securities Act of the Registrable Securities for which the Demand
Committee has requested registration under this Section 2.2, all to the extent necessary to
permit the disposition (in accordance with the intended methods thereof as aforesaid) of the
Registrable Securities so to be registered. The Demand Committee shall allocate

 

 

participation in any Demand Registration ratably among Covered Persons in accordance
with their Registrable Securities.

     (b) At any time prior to the effective date of the registration statement relating to
such registration, the Demand Committee may revoke such Demand Registration request by
providing a notice to the Company revoking such request. The Company shall be liable for
and pay all Registration Expenses in connection with any Demand Registration.

     (c) If the sole or managing underwriter of a Demand Registration advises the Company in
writing that in its opinion the number of Registrable Securities and other securities
requested to be included exceeds the number of Registrable Securities and other securities
which can be sold in such offering without adversely affecting the distribution of the
securities being offered, the price that will be paid in such offering or the marketability
thereof, the Company will include in such registration the greatest number of (i)
Registrable Securities proposed to be registered by the holders thereof, (ii) securities
having Other Registration Rights that are pari passu with the demand rights granted in
respect of Registrable Securities hereunder proposed to be registered by the holders thereof
and (iii) securities proposed to be registered by the Company for its own account which in
the opinion of such underwriters can be sold in such offering without adversely affecting
the distribution of the securities being offered, the price that will be paid in such
offering or the marketability thereof, ratably among the holders of Registrable Securities,
the holders of such Other Registration Rights and the Company, based (A) as between the
Company and such holders requesting registration, on the respective amounts of securities
requested to be registered, and (B) as among the holders requesting registration, on the
respective amounts of Registrable Securities (whether requested to be registered pursuant to
Sections 2.1, 2.2 or 2.3) and securities subject to such Other Registration Rights, as the
case may be, held by each such holder; provided, however, that the Company shall have the
right (the “Priority Right”) to receive priority over all holders of Registrable
Securities in any Demand Registration to be effected under this Section 2.2 with respect to
securities that the Company proposes to include in such registration for its own account by
giving written notice of its election to exercise such Priority Right to the holders of
Registrable Securities requesting registration thereof.

     (d) Upon notice to the Demand Committee, the Company may postpone effecting a
registration pursuant to this Section 2.2 on up to three occasions during any period of six
consecutive months for a reasonable time specified in the notice but not exceeding 120 days
in the aggregate (which period may not be extended or renewed), if (i) the Board shall
determine in good faith that effecting the registration would materially and adversely
affect an offering of securities of the Company the preparation of which had then been
commenced or (ii) the Company is in possession of material non-public information the
disclosure of which during the period specified in such notice the Board believes in good
faith would not be in the best interests of the Company.

 

 

          Section 2.3 Incidental Registration.

     (a) Requests for Incidental Registration. At any time the Company proposes to
register any shares of Class A Common Stock under the Securities Act (other than an Exchange
Registration or registrations on such form(s) solely for registration of shares of Class A
Common Stock in connection with any employee benefit plan or dividend reinvestment plan or a
merger or consolidation), including registrations pursuant to Section 2.2(a), whether or not
for sale for its own account, the Company will give written notice to the Demand Committee
at least fifteen (15) days prior to the initial filing of such Registration Statement with
the SEC of its intent to file such registration statement. Upon the written request of the
Demand Committee made within twenty (20) days after any such notice is given (which request
shall specify the Registrable Securities intended to be disposed of by such holder), the
Company will use its commercially reasonable efforts to effect the registration (an
“Incidental Registration”) under the Securities Act of all Registrable Securities
which the Company, as the case may be, has been so requested to register by the Demand
Committee; provided, however, that if, at any time after giving written
notice of its intention to register any securities and prior to the effective date of the
Registration Statement filed in connection with such Incidental Registration, the Company
shall determine for any reason not to register or to delay registration of such securities,
the Company may, at its election, give written notice of such determination to each holder
of such Registrable Securities and, thereupon, (a) in the case of a determination not to
register, the Company shall be relieved of its obligation to register any Registrable
Securities under this Section 2.3 in connection with such registration (but not from its
obligation to pay the expenses incurred in connection therewith), and (b) in the case of a
determination to delay registration, the Company shall be permitted to delay registering any
Registrable Securities under this Section 2.3 during the period that the registration of
such other securities is delayed. The Demand Committee shall allocate participation in any
Incidental Registration ratably among Covered Persons in accordance with their Registrable
Securities.

     (b) Priority on Incidental Registration. If the sole or managing underwriter
of a registration advises the Company in writing that in its opinion the number of
Registrable Securities and other securities requested to be included exceeds the number of
Registrable Securities and other securities which can be sold in such offering without
adversely affecting the distribution of the securities being offered, the price that will be
paid in such offering or the marketability thereof, the Company will include in such
registration the Registrable Securities and other securities of the Company in the following
order of priority:

          (i) first, the greatest number of securities of the Company proposed to be included in
such registration by the Company for its own account and by holders of Other Registration
Rights that have priority over the Incidental Registration rights granted to holders of
Registrable Securities under this Agreement, which in the opinion of such underwriters can
be so sold; and

          (ii) second, after all securities that the Company proposes to register for its own
account or for the accounts of holders of Other Registration Rights

 

 

that have priority over the Incidental Registration rights under this Agreement have
been included, the greatest amount of Registrable Securities and securities having Other
Registration Rights that are pari passu with Registrable Securities, in each case
requested to be registered by the holders thereof which in the opinion of such underwriters
can be sold in such offering without adversely affecting the distribution of the securities
being offered, the price that will be paid in such offering or the marketability thereof,
ratably among the holders of Registrable Securities (whether requested to be registered
pursuant to Sections 2.1, 2.2 or 2.3) and securities subject to such Other Registration
Rights based on the respective amounts of Registrable Securities and securities subject to
such Other Registration Rights held by each such holder.

     (c) Upon delivering a request under this Section 2.3, a Covered Person will, if
requested by the Company, execute and deliver a custody agreement and power of attorney in
form and substance reasonably satisfactory to the Company with respect to such Covered
Person’s Securities to be registered pursuant to this Section 2.3 (a “Custody Agreement
and Power of Attorney”). The Custody Agreement and Power of Attorney will provide,
among other things, that the Covered Person will deliver to and deposit in custody with the
custodian and attorney-in-fact named therein a certificate or certificates representing such
Securities (duly endorsed in blank by the registered owner or owners thereof or accompanied
by duly executed stock powers in blank) and irrevocably appoint said custodian and
attorney-in-fact with full power and authority to act under the Custody Agreement and Power
of Attorney on such Covered Person’s behalf with respect to the matters specified therein.
Such Covered Person also agrees to execute such other agreements as the Company may
reasonably request to further evidence the provisions of this Section 2.3.

     (d) Notwithstanding anything to the contrary herein, after the time the Company has
caused to become effective an Exchange Registration, covering all shares to be registered
pursuant to Section 2.1 hereof, and at any time that such Exchange Registration remains
effective and available for use, any Covered Person who is not an “affiliate” of the Company
for purposes of Rule 144 shall not have the right to participate in such Incidental
Registration pursuant to this Section 2.3, except to the extent the shares to be registered
and offered pursuant to such Incidental Registration will be an underwritten offering.

          Section 2.4 Holdback Agreements.

     (a) Each Covered Person agrees that if requested in writing in connection with an
underwritten offering made pursuant to a Registration Statement for which such Covered
Person has registration rights pursuant to this Article II by the managing underwriter or
underwriters of such underwritten offering, such holder will not effect any Public Sale or
distribution of any of the securities being registered or any securities convertible or
exchangeable or exercisable for such securities (except as part of such underwritten
offering), during the period beginning 10 days prior to, and ending 180 days after, the
effective date of the Company’s initial public offering of the Class A Common Stock (the
“IPO Holdback Period”), except as part of such Initial Public Offering, or, in the case of
any subsequent underwritten offering pursuant to this Agreement, during the

 

 

period beginning seven days prior to, and ending 90 days after, the effective date of
any such subsequent underwritten registration (the “Follow-On Holdback Period”), except as
part of any such underwritten registration (or for such shorter period as to which the
managing underwriter or underwriters may agree, provided that such shorter period applies
equally to all Covered Persons). If (i) the Company issues an earnings release or discloses
other material information or a material event relating to the Company occurs during the
last 17 days of the IPO Holdback Period or a Follow-On Holdback Period (as applicable) or
(ii) prior to the expiration of the IPO Holdback Period or a Follow-On Holdback Period (as
applicable), the Company announces that it will release earnings results during the 16-day
period beginning upon the expiration of such period, then to the extent necessary for a
managing or co-managing underwriter of a registered offering required hereunder to comply
with FINRA Rule 2711(f)(4), the IPO Holdback Period or the Follow-On Holdback Period (as
applicable) will be extended until 18 days after the earnings release or disclosure of other
material information or the occurrence of the material event, as the case may be (a
“Holdback Extension”). Notwithstanding the foregoing, no Follow-On Holdback Period shall
apply to any person who (i) is not an executive officer or director of the Company, a
selling stockholder in such offering or a person selling Holdings Units to the Company,
Holdings or any of the their respective subsidiaries if such purchase is funded by the sale
of Class A Common Stock by the Company, Holdings or any of their respective subsidiaries in
such offering and (ii) holds, together with its affiliates, less than 1% of the
then-outstanding Class A Common Stock.

     (b) The Company agrees (i) not to effect any public sale or distribution of its equity
securities, or any securities convertible into or exchangeable or exercisable for such
securities, during the seven days prior to and during the 180-day period beginning on the
effective date of any underwritten Demand Registration (or for such shorter period as to
which the managing underwriter or underwriters may agree), except as part of such Demand
Registration or in connection with an Exchange Registration or any employee benefit or
similar plan, any dividend reinvestment plan, or a business acquisition or combination and
(ii) to use all reasonable efforts to cause each holder of at least 5% (on a fully-diluted
basis) of its Class A Common Stock, or any securities convertible into or exchangeable or
exercisable for such Class A Common Stock, which are or may be purchased from the Company at
any time after the date of this Agreement (other than in a registered offering) to agree not
to effect any sale or distribution of any such Class A Common Stock during such period
(except as part of such underwritten offering, if otherwise permitted).

          Section 2.5 Registration Procedures. In connection with any request by the Demand
Committee that Registrable Securities be registered pursuant to Sections 2.2 or 2.3, subject to the
provisions of such Sections, the paragraphs below shall be applicable, and in connection with any
Exchange Registration pursuant to Section 2.1, paragraphs (a), (c), (d), (e), (f), (k), (l) and (n)
below shall be applicable:

     (a) The Company shall as expeditiously as reasonably practicable prepare and file with
the SEC a registration statement on any form for which the Company then qualifies or that
counsel for the Company shall deem appropriate and which form shall be available for the
registration of the Registrable Securities to be registered thereunder in

 

 

accordance with the intended method of distribution thereof, and use its commercially
reasonable efforts to cause such filed registration statement to become and remain effective
for a period of not less than 40 days, or in the case of an Exchange Registration until all
of the Registrable Securities of the Covered Persons included in any such registration
statement (each, a “Registering Covered Person”) shall have actually been exchanged
thereunder.

     (b) Prior to filing a registration statement or prospectus or any amendment or
supplement thereto, the Company shall, if requested, furnish to each Registering Covered
Person and each underwriter, if any, of the Registrable Securities covered by such
registration statement copies of such registration statement as proposed to be filed, and
thereafter the Company shall furnish to such Registering Covered Person and underwriter, if
any, such number of copies of such registration statement, each amendment and supplement
thereto (in each case including all exhibits thereto and documents incorporated by reference
therein), the prospectus included in such registration statement (including each preliminary
prospectus and any summary prospectus) and any other prospectus filed under Rule 424 or Rule
430A under the Securities Act and such other documents as such Registering Covered Person or
underwriter may reasonably request in order to facilitate the disposition of the Registrable
Securities owned by such Registering Covered Person. The Registering Covered Person shall
have the right to request that the Company modify any information contained in such
registration statement, amendment and supplement thereto pertaining to such Registering
Covered Person and the Company shall use its commercially reasonable efforts to comply with
such request, provided, however, that the Company shall not have any obligation to so modify
any information if the Company reasonably expects that so doing would cause the prospectus
to contain an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not misleading.

     (c) After the filing of the registration statement, the Company shall (i) cause the
related prospectus to be supplemented by any required prospectus supplement, and, as so
supplemented, to be filed pursuant to Rule 424 under the Securities Act, (ii) comply with
the provisions of the Securities Act with respect to the disposition of all Registrable
Securities covered by such registration statement during the applicable period in accordance
with the intended methods of disposition by the Registering Covered Person thereof set forth
in such registration statement or supplement to such prospectus and (iii) promptly notify
each Registering Covered Person holding Registrable Securities covered by such registration
statement of any stop order issued or threatened by the SEC suspending the effectiveness of
such registration statement or any state securities commission and take all commercially
reasonable efforts to prevent the entry of such stop order or to obtain the withdrawal of
such order if entered.

     (d) To the extent any “free writing prospectus” (as defined in Rule 405 under the
Securities Act) is used, the Company shall file with the SEC any free writing prospectus
that is required to be filed by the Company with the SEC in accordance with the Securities
Act and retain any free writing prospectus not required to be filed.

 

 

     (e) The Company shall use its commercially reasonable efforts to (i) register or
qualify the Registrable Securities covered by such registration statement under such other
securities or “blue sky” laws of such jurisdictions in the United States as any Registering
Covered Person holding such Registrable Securities or each underwriter, if any, reasonably
(in light of such member’s intended plan of distribution) requests and (ii) cause such
Registrable Securities to be registered with or approved by such other governmental agencies
or authorities as may be necessary by virtue of the business and operations of the Company
and do any and all other acts and things that may be reasonably necessary or advisable to
enable such Registering Covered Person to consummate the disposition of the Registrable
Securities owned by such person, provided that the Company shall not be required to (A)
qualify generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this Section 2.5(e), (B) subject itself to taxation in any such
jurisdiction or (C) consent to general service of process in any such jurisdiction.

     (f) The Company shall immediately notify each Registering Covered Person holding such
Registrable Securities covered by such registration statement or each underwriter, if any,
at any time when a prospectus relating thereto is required to be delivered under the
Securities Act, of the occurrence of an event requiring the preparation of a supplement or
amendment to such prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain an untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary to make
the statements therein not misleading and promptly prepare and make available to each such
Registering Covered Person or underwriter, if any, and file with the SEC any such supplement
or amendment.

     (g) The Demand Committee shall select an underwriter or underwriters in connection with
any Public Offering. In connection with any Public Offering, the Company shall enter into
customary agreements (including an underwriting agreement in customary form) and take such
all other actions as are reasonably required in order to expedite or facilitate the
disposition of such Registrable Securities in any such Public Offering, including if
necessary the engagement of a “qualified independent underwriter” in connection with the
qualification of the underwriting arrangements with FINRA.

     (h) Subject to the execution of confidentiality agreements satisfactory in form and
substance to the Company in the exercise of its good faith judgment, pursuant to the
reasonable request of the Demand Committee or underwriter (if any), the Company will give to
each Registering Covered Person, each underwriter (if any) and their respective counsel and
accountants (i) reasonable and customary access to its books and records and (ii) such
opportunities to discuss the business of the Company with its directors, officers,
employees, counsel and the independent public accountants who have certified its financial
statements, as shall be appropriate, in the reasonable judgment of counsel to such
Registering Covered Person or underwriter, to enable them to exercise their due diligence
responsibility.

     (i) The Company shall use its commercially reasonable efforts to furnish to each
Registering Covered Person and to each such underwriter, if any, a signed

 

 

counterpart, addressed to such person or underwriter, of (i) an opinion or opinions of
counsel to the Company and (ii) a comfort letter or comfort letters from the Company’s
independent public accountants, each in customary form and covering such matters of the kind
customarily covered by opinions or comfort letters, as the case may be, as the Demand
Committee or underwriter reasonably requests.

     (j) Each Registering Covered Person registering securities under Sections 2.2 or 2.3
shall promptly furnish in writing to the Company the information set forth in Appendix B and
such other information regarding itself, the distribution of the Registrable Securities as
the Company may from time to time reasonably request and such other information as may be
legally required or advisable in connection with such registration.

     (k) Each Registering Covered Person and each underwriter, if any, agrees that, upon
receipt of any notice from the Company of the happening of any event of the kind described
in Section 2.5(f), such Registering Covered Person or underwriter shall forthwith
discontinue disposition of Registrable Securities pursuant to the registration statement
covering such Registrable Securities until such Registering Covered Person’s or
underwriter’s receipt of the copies of the supplemented or amended prospectus contemplated
by Section 2.5(f), provided, however, that, upon written notice to each
Registering Covered Person and each underwriter, if any, and for a reasonable time specified
in the notice but not exceeding 60 days thereafter or 90 days in any 365 day period (the
“Suspension Period”), the Company may suspend the use or effectiveness of any
registration statement if the Company’s Board reasonably believes that the Company is in
possession of material non-public information, the failure of which to be disclosed in the
prospectus included in the registration statement could constitute a material misstatement
or omission; and, if so directed by the Company, such Registering Covered Person or
underwriter shall deliver to the Company all copies, other than any permanent file copies
then in such Registering Covered Person’s possession, of the most recent prospectus covering
such Registrable Securities at the time of receipt of such notice. If the Company shall
give such notice, the Company shall extend the period during which such registration
statement shall be maintained effective (including the period referred to in Section 2.5(a))
by the number of days during the period from and including the date of the giving of notice
pursuant to Section 2.5(f) to the date when the Company shall make available to such
Registering Covered Person a prospectus supplemented or amended to conform with the
requirements of Section 2.5(f).

     (l) The Company shall use its commercially reasonable efforts to list all Registrable
Securities covered by such registration statement on any securities exchange or quotation
system on which any of the Registrable Securities are then listed or traded.

     (m) The Company shall cause appropriate officers of the Company or Holdings to (i)
prepare and make presentations at any “road shows” and before analysts and rating agencies,
as the case may be, (ii) take other actions to obtain ratings for any Registrable Securities
and (iii) otherwise use their commercially reasonable efforts to cooperate as reasonably
requested by the underwriters in the offering, marketing or selling of the Registrable
Securities.

 

 

     (n) The Company shall cooperate with the Registering Covered Persons to facilitate the
timely delivery of Registrable Securities to be sold, which shall not bear any restrictive
legends, and to enable such Registrable Securities to be issued in such denominations and
registered in such names as such Registering Covered Persons may reasonably request at least
two business days prior to the closing of any sale of Registrable Securities.

          Section 2.6 Indemnification by the Company. In the event of any registration of any
Registrable Securities of the Company under the Securities Act pursuant to this Article II, the
Company will, and it hereby does, indemnify and hold harmless, to the extent permitted by law, a
Registering Covered Person, each affiliate of such Registering Covered Person and their respective
directors and officers or general and limited partners or members and managing members (including
any director, officer, affiliate, employee, agent and controlling person of any of the foregoing)
and each other person, if any, who controls such seller within the meaning of the Securities Act
(collectively, the “Indemnified Parties”), from and against any and all losses, claims,
damages and liabilities (including, without limitation, legal fees and other expenses incurred in
connection with any suit, action or proceeding or any claim asserted, as such fees and expenses are
incurred), joint or several, that arise out of, or are based upon, (1) any untrue statement or
alleged untrue statement of a material fact contained in any registration statement or amendment or
supplement thereto under which such Registrable Securities were registered or any omission or
alleged omission to state therein a material fact required to be stated therein or necessary in
order to make the statements therein not misleading, or (2) any untrue statement or alleged untrue
statement of a material fact contained in any prospectus, any free writing prospectus or any
“issuer information” filed or required to be filed pursuant to Rule 433(d) under the Securities Act
in respect of the Registrable Securities, or amendment or supplement thereto, or any omission or
alleged omission to state therein a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading;
provided, that the Company shall not be liable to any Indemnified Party in any such case to
the extent that any such loss, claim, damage, liability (or action or proceeding in respect
thereof) or expense arises out of or is based upon any untrue statement or alleged untrue statement
or omission or alleged omission made in such registration statement, prospectus, any free writing
prospectus or any “issuer information” filed or required to be filed pursuant to Rule 433(d) under
the Securities Act in respect of the Registrable Securities, or amendment or supplement thereto, in
reliance upon and in conformity with written information furnished to the Company with respect to
such seller or any underwriter specifically for use in the preparation thereof.

          Section 2.7 Indemnification by Registering Covered Persons. Each Registering Covered
Person hereby severally and not jointly indemnifies and holds harmless, and the Company may
require, as a condition to including any Registrable Securities in any registration statement filed
in accordance with this Article II, that the Company shall have received an undertaking reasonably
satisfactory to it from any underwriter to indemnify and hold harmless, the Company and all other
prospective sellers of Registrable Securities, each officer of the Company who signed the
Registration Statement and each person, if any, who controls the Company and all other prospective
sellers of Registrable Securities within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act to the same extent as the indemnity set forth in Section 2.6 above, but only
with respect to any losses, claims, damages or

 

 

liabilities that arise out of, or are based upon, any untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with written information
furnished to the Company with respect to such seller specifically for use in the preparation of
such registration statement, prospectus, any free writing prospectus or any “issuer information”
filed or required to be filed pursuant to Rule 433(d) under the Securities Act in respect of the
Registrable Securities, or amendment or supplement thereto. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of the Company, any of the
Registering Covered Persons or any underwriter, or any of their respective affiliates, directors,
officers or controlling persons and shall survive the transfer of such securities by such person.
In no event shall any such indemnification liability of any Registering Covered Person be greater
in amount than the dollar amount of the proceeds received by such Registering Covered Person upon
the sale of the Registrable Securities giving rise to such indemnification obligation.

          Section 2.8 Conduct of Indemnification Proceedings. Promptly after receipt by an
Indemnified Party hereunder of written notice of the commencement of any action or proceeding with
respect to which a claim for indemnification may be made pursuant to this Article II, such
Indemnified Party will, if a claim in respect thereof is to be made against an indemnifying party,
give written notice to the latter of the commencement of such action; provided, that the failure of
the Indemnified Party to give notice as provided herein shall not relieve the indemnifying party of
its obligations under this Article II, except to the extent that the indemnifying party is
materially prejudiced by such failure to give notice.

          In case any such action is brought against an Indemnified Party, unless in such Indemnified
Party’s reasonable judgment a conflict of interest between such Indemnified Party and indemnifying
parties may exist in respect of such claim, the indemnifying party will be entitled to participate
in and to assume the defense thereof, jointly with any other indemnifying party similarly notified
to the extent that it may wish, with counsel reasonably satisfactory to such Indemnified Party, and
after notice from the indemnifying party to such Indemnified Party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such Indemnified Party for any legal
or other expenses subsequently incurred by the latter in connection with the defense thereof other
than reasonable costs of investigation. It is understood and agreed that the indemnifying person
shall not, in connection with any proceeding or related proceeding in the same jurisdiction, be
liable for the fees and expenses of more than one separate firm (in addition to any local counsel)
for all Indemnified Parties, and that all such fees and expenses shall be reimbursed as they are
incurred. Any such separate firm (x) for any Covered Person, its affiliates, directors and officers
and any control persons of such Indemnified Party shall be designated in writing by the Demand
Committee, (y) in all other cases shall be designated in writing by the Board. The indemnifying
person shall not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying person agrees to indemnify each Indemnified Party from and against any loss or
liability by reason of such settlement or judgment. No indemnifying person shall, without the
written consent of the Indemnified Party, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Party is or could have been a party and
indemnification could have been sought hereunder by such Indemnified Party, unless such settlement
(A) includes an unconditional release of such Indemnified Party, in form and substance reasonably
satisfactory to such Indemnified Party, from all liability on claims that are the subject matter of
such proceeding and

 

 

(B) does not include any statement as to or any admission of fault, culpability or a failure
to act by or on behalf of any Indemnified Party.

          Section 2.9 Contribution. If the indemnification provided for in this Article II from
the indemnifying party is unavailable to an Indemnified Party hereunder in respect of any losses,
claims, damages, liabilities or expenses referred to herein, then the indemnifying party, in lieu
of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such losses, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying party and
Indemnified Parties in connection with the actions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations. The relative
fault of such indemnifying party and Indemnified Parties shall be determined by reference to, among
other things, whether any action in question, including any untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact, has been made by, or
relates to information supplied by, such indemnifying party or Indemnified Parties, and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such action. The amount paid or payable by a party under this Section 2.9 as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be deemed to include any
legal or other fees or expenses reasonably incurred by such party in connection with any
investigation or proceeding.

          The parties hereto agree that it would not be just and equitable if contribution pursuant to
this Section 2.9 were determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to in the immediately preceding
paragraph. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.

          Section 2.10 Participation in Public Offering. No Covered Person may participate in
any Public Offering hereunder unless such Covered Person (a) agrees to sell such Covered Person’s
securities on the basis provided in any underwriting arrangements approved by the Covered Persons
entitled hereunder to approve such arrangements and (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents reasonably required
under the terms of such underwriting arrangements and the provisions of this Agreement in respect
of registration rights.

          Section 2.11 Other Indemnification. Indemnification similar to that specified herein
(with appropriate modifications) shall be given by the Company and the Registering Covered Person
participating therein with respect to any required registration or other qualification of
securities under any federal or state law or regulation or Governmental Authority other than the
Securities Act.

          Section 2.12 Parties in Interest. Each Covered Person shall be entitled to receive
the benefits of this Agreement and shall be bound by the terms and provisions of this Agreement by
reason of such Covered Person’s election to participate in a registration under this Article II.
To the extent Holdings Units are effectively transferred in accordance with the terms of the
Holdings LLC Agreement, the Permitted Transferee of such Holdings Units shall be

 

 

entitled to receive the benefits of this Agreement and shall be bound by the terms and
provisions of this Agreement upon becoming bound hereby pursuant to Section 3.1(c).

          Section 2.13 Acknowledgement Regarding the Company. Other than those determinations
reserved expressly to the Demand Committee, all determinations necessary or advisable under this
Article II shall be made by the Board, the determinations of which shall be final and binding.

          Section 2.14 Mergers, Recapitalizations, Exchanges or Other Transactions Affecting
Registrable Securities. The provisions of this Agreement shall apply to the full extent set
forth herein with respect to the Registrable Securities, to any and all securities or units of
Holdings or the Company or any successor or assign of any such person (whether by merger,
amalgamation, consolidation, sale of assets or otherwise) that may be issued in respect of, in
exchange for, or in substitution of such Registrable Securities, by reason of any dividend, split,
issuance, reverse split, combination, recapitalization, reclassification, merger, amalgamation,
consolidation or otherwise.

ARTICLE III

MISCELLANEOUS

          Section 3.1 Term of the Agreement; Termination of Certain Provisions.

          (a) The term of this Agreement shall continue until the first to occur of (i) such time as no
Covered Person holds any Covered Holdings Units or Registrable Securities and (ii) such time as the
Agreement is terminated by the Company and the Demand Committee. This Agreement may be amended only
with the consent of the Company and the Demand Committee; provided that no amendment may materially
and adversely affect the rights of a Covered Person, as such, other than on a pro rata basis with
other Covered Persons without the consent of such Covered Person (or, if there is more than one
such Covered Person that is so affected, without the consent of a majority of such affected Covered
Persons in accordance with their holdings of Covered Holdings Units and Registrable Securities).

          (b) Unless this Agreement is theretofore terminated pursuant to Section 3.1(a) hereof, a
Covered Person shall be bound by the provisions of this Agreement with respect to any Covered
Holdings Units or Registrable Securities until such time as such Covered Person ceases to hold any
Covered Holdings Units or Registrable Securities. Thereafter, such Covered Person shall no longer
be bound by the provisions of this Agreement other than Sections 2.7, 2.8, 2.9 and 2.11 and this
Article III.

          (c) Any Permitted Transferee of a Covered Person shall be entitled to become part to this
agreement as a Covered Person; provided, that, such Permitted Transferee shall first sign an
agreement in the form approved by the Company acknowledging that such Permitted Transferee is bound
by the terms and provisions of the Agreement.

          Section 3.2 Assignment; Successors. This Agreement shall be binding upon and
inure to the benefit of the respective legatees, legal representatives, successors and assigns of
the Covered Persons;
provided, however, that a Covered Person may not assign this Agreement or any of his rights or
obligations hereunder, and any purported assignment in breach hereof by a

 

 

Covered Person shall be
void except in connection with any transfer to a Permitted Transferee in accordance with this
Agreement; and provided further that no assignment of this Agreement by the Company or to a
successor of the Company (by operation of law or otherwise) shall be valid unless such assignment
is made to a person which succeeds to the business of such person substantially as an entirety.

          Section 3.3 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.

          Section 3.4 Severability. Whenever possible, each provision of this Agreement shall
be interpreted in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability
shall not affect any other provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable
provision had never been contained herein.

          Section 3.5 Entire Agreement. Except as otherwise expressly set forth herein, this
document embodies the complete agreement and understanding among the parties hereto with respect to
the subject matter hereof and supersedes and preempts any prior understandings, agreements or
representations by or among the parties, written or oral, which may have related to the subject
matter hereof in any way.

          Section 3.6 Successors and Assigns; Certain Transferees Bound Hereby. Except as
otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable
by each of the Company and Holdings and their successors and assigns, and by the Covered Persons
and their respective successors and assigns so long as they hold shares of Class A Common Stock or
Holdings Units.

          Section 3.7 Counterparts. This Agreement may be executed in separate counterparts
each of which shall be an original and all of which taken together shall constitute one and the
same agreement.

          Section 3.8 Remedies. The Company, Holdings and the Covered Persons shall be entitled
to enforce their rights under this Agreement specifically, to recover damages by reason of any
breach of any provision of this Agreement (including costs of enforcement) and to exercise all
other rights existing in their favor. The parties hereto agree and acknowledge that money damages
would not be an adequate remedy for any breach of the provisions of this Agreement and that, in
addition to any other rights and remedies existing in its favor, the Company, Holdings or any
Covered Person may in its or his sole discretion apply to any court of law or equity of competent
jurisdiction for specific performance and/or other injunctive relief (without posting a bond or
other security) in order to enforce or prevent any violation of the provisions of this Agreement.

          Section 3.9 Notices. All notices, requests, claims, demands and other communications
hereunder shall be in writing and shall be given (and shall be deemed to have

 

 

been duly given upon
receipt) by delivery in person, by courier service, by fax, by electronic mail (delivery receipt
requested) or by registered or certified mail (postage prepaid, return receipt requested) to the
respective parties at the following addresses (or at such other address for a party as shall be as
specified in a notice given in accordance with this Section 3.9):

          (a) If to the Company at:

FXCM Inc.

32 Old Slip

New York, New York 10005

Attention: Chief Financial Officer

with a copy to:

Simpson Thacher & Bartlett LLP

425 Lexington Avenue

New York, New York 10017-3954

Attention: Joshua Ford Bonnie, Esq.

          (b) If to Holdings at:

FXCM Holdings, LLC

32 Old Slip

New York, New York 10005

Attention: Chief Financial Officer

with a copy to:

Simpson Thacher & Bartlett LLP

425 Lexington Avenue

New York, New York 10017-3954

Attention: Joshua Ford Bonnie, Esq.

     (c) If to any Covered Person, to the address and other contact information set forth in
the records of Holdings from time to time.

          Section 3.10 Governing Law. The Delaware Limited Liability Company Act shall govern
all questions arising under this Agreement concerning the relative rights of Holdings and the
holders of its limited liability company interests. The Delaware General Company Law shall govern
all questions arising under this Agreement concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity and interpretation of this
Agreement shall be governed by and construed in accordance with the domestic laws of the State of
New York applicable to contracts made and to be performed in the State of New York.

          Section 3.11 Specific Performance. Each party hereto acknowledges that the remedies
at law of the other parties for a breach or threatened breach of this Agreement would be inadequate
and, in recognition of this fact, any party to this Agreement, without posting any

 

 

bond, and in
addition to all other remedies that may be available, shall be entitled to obtain equitable relief
in the form of specific performance, a temporary restraining order, a temporary or permanent
injunction or any other equitable remedy that may be then available.

          Section 3.12 Descriptive Headings. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.

[Remainder of Page Intentionally Left Blank]

 

 

          IN WITNESS WHEREOF, the parties hereto have duly executed or caused to be duly executed this
Agreement as of the dates indicated.

	 	 	 	 	 
	 	FXCM INC.

 	 
	 	By:  	/s/ David S. Sassoon
 	 
	 	 	Name:  	David S. Sassoon 	 
	 	 	Title:  	Secretary and General Counsel 	 
	 
	 	COVERED PERSONS

Each Covered Person set forth on Annex A hereto

 	 
	 	By:  	/s/ David S. Sassoon
 	 
	 	 	Name:  	David S. Sassoon 	 
	 	 	Title:  	Attorney-in-fact 	 

 

 

Appendix A

FXCM INC.

Covered
Person Questionnaire

The undersigned Covered Person understands that the Company has filed or intends to file with the
SEC a registration statement for the registration of the shares of Class A Common Stock (as such
may be amended, the “Registration Statement”), in accordance with Sections 2.2 or 2.3 of
the Registration Rights Agreement, dated as of                                          (the “Registration Rights
Agreement”), among the Company and the Covered Persons referred to therein. A copy of the
Agreement is available from the Company upon request at the address set forth below. All
capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in
the Registration Rights Agreement.

NOTICE

The undersigned Covered Person hereby gives notice to the Company of its intention to register
Registrable Securities beneficially owned by it and listed below in Item 3 (unless otherwise
specified under Item 3) pursuant to the Registration Statement. The undersigned, by signing and
returning this Questionnaire, understands that it will be bound by the terms and conditions of this
Questionnaire and the Registration Rights Agreement.

Pursuant to the Registration Rights Agreement, the undersigned has agreed to indemnify and hold
harmless the Company and all other prospective sellers of Registrable Securities, each officer of
the Company who signed the Registration Statement and each person, if any, who controls the Company
and all other prospective sellers of Registrable Securities within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities arising in connection with statements made or omissions concerning the
undersigned in the Registration Statement, prospectus, any free writing prospectus or any “issuer
information” in reliance upon the information provided in this Questionnaire.

The undersigned Covered Person hereby provides the following information to the Company and
represents and warrants that such information is accurate and complete:

QUESTIONNAIRE

1. Name.

	 	(a)	 	Full Legal Name of Covered Person:
	 
	 
	 	 	 	 

	 
	 	(b)	 	Full Legal Name of Covered Person (if not the same as (a) above) through which
Registrable Securities Listed in Item 3 below are held:
	 
	 
	 	 	 	 

 

 

	 	(c)	 	Full Legal name of DTC Participant (if applicable and if not the same as (b)
above) through which Registrable Securities listed in Item 3 below are held:
	 
	 
	 	 	 	 

	 
	 	(d)	 	Full Legal Name of natural control person (which means a natural person who
directly or indirectly alone or with others has power to vote or dispose of the
Registrable Securities listed in Item 3 below):
	 
	 
	 	 	 	 

2. Address for Notices to Covered Person:

	 
	 	 	 	 

	 
	 	 	 	 

	 
	 	 	 	 

	 	 	 
	Telephone:
	 	 
	 

	 	 

	 	 	 

	Fax:
	 	 
	 

	 	 

	 	 	 

	Email:
	 	 
	 

	 	 

	 	 	 

	Contact Person:
	 	 
	 

	 	 

3. Beneficial Ownership of Registrable Securities:

	 	 	 	Number of Registrable Securities beneficially owned:
	 
	 
	 	 	 	 

	 
	 	 	 	 

	 
	 	 	 	 

4. Broker-Dealer Status:

	 	(a)	 	Are you a broker-dealer?

Yes      o          No     o

	 	Note: 	 	If yes, the SEC’s staff has indicated that you should be identified as an
underwriter in the Registration Statement.
	 
	 	(b)	 	Are you an affiliate of a broker-dealer?

Yes      o          No     o

	 	 	 	If yes, please identify the broker-dealer with whom the Covered Person is affiliated
and the nature of the affiliation:                               
	 
	 
	 	 	 	 

	 
	 	 	 	 

 

 

	 	(c)	 	If you are an affiliate of a broker-dealer, do you certify that you bought the
Registrable Securities in the ordinary course of business, and at the time of the
purchase of the Registrable Securities to be resold, you had no agreements or
understandings, directly or indirectly, with any person to distribute the Registrable
Securities?

Yes      o          No     o

	 	Note: 	 	If no, the SEC’s staff has indicated that you should be identified as an
underwriter in the Registration Statement.
	 
	 	(d)	 	If you are (1) a broker-dealer or (2) an affiliate of a broker-dealer and
answered “no” to Question 4(c), do you consent to being named as an underwriter in the
Registration Statement?

Yes      o          No     o

5. Beneficial Ownership of Other Securities of the Company Owned by the Covered Person.

	 	 	 	Except as set forth below in this Item 5, the undersigned Covered Person is not the
beneficial or registered owner of any securities of the Company other than the
Registrable Securities listed above in Item 3.
	 
	 	 	 	Type and Amount of Other Securities beneficially owned by the Covered Person:
	 
	 
	 	 	 	 

	 
	 	 	 	 

	 
	 	 	 	 

6. Relationships with the Company:

	 	 	 	Except as set forth below, neither the undersigned Covered Person nor any of its
affiliates, officers, directors or principal equity holders (owners of 5% or more of
the equity securities of the undersigned) has held any position or office or has had
any other material relationship with the Company (or its predecessors or affiliates)
during the past three years.
	 
	 	 	 	State any exceptions here:
	 
	 
	 	 	 	 

	 
	 	 	 	 

 

 

7. Intended Method of Disposition of Registrable Securities (Only Applicable to a Demand
Registration Effected Pursuant to Section 2.2 of the Registration Rights Agreement):

	 	 	 	Intended Method or Methods of Disposition of Registrable Securities beneficially
owned:
	 
	 	 	 	 

	 
	 	 	 	 

	 
	 	 	 	 

 

 

The undersigned agrees to promptly notify the Company of any inaccuracies or changes in the
information provided herein that may occur subsequent to the date hereof and at any time while the
Registration Statement remains in effect.

By signing below, the undersigned consents to the disclosure of the information contained herein in
its answers to Items 1 through 7 and the inclusion of such information in the Registration
Statement and the related prospectus. The undersigned understands that such information will be
relied upon by the Company in connection with the preparation or amendment of the Registration
Statement and the related prospectus.

IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this Questionnaire to be
executed and delivered either in person or by its duly authorized agent.

	 	 	 	 	 	 	 	 	 	 

	Dated:

	 	 	 	 	 	Beneficial Owner:	 	 	 
	 

	 	 
	 	 	 	 	 	 	 

	 	 	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

     PLEASE SEND A COPY OF THE COMPLETED AND EXECUTED QUESTIONNAIRE BY FAX OR ELECTRONIC MAIL, AND
RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:

FXCM Inc.

32 Old Slip

New York, New York 10005

Attention: Chief Financial Officer

Fax:

Electronic Mail:

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