Document:

<PAGE>

                                                                   EXHIBIT 10.16

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND
HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH,
THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF
COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER THE SECURITIES ACT OF 1933.

                          CONVERTIBLE PROMISSORY NOTE

$9,999,999.89                                                      March 1, 2000
                                                            Bellevue, Washington

     For value received, Mercata, Inc., a Delaware corporation (the "Company"),
promises to pay to Waelinvest. (the "Holder"), the principal sum of nine million
nine hundred ninety-nine thousand nine hundred ninety-nine dollars and eighty-
nine cents ($9,999,999.89). No interest shall accrue or be paid on this Note;
provided, that if this Note shall not have converted in accordance with Section
2 below on or before May 31, 2000, this Note shall bear interest accruing from
the date hereof on the unpaid principal amount at a rate equal to the lower of
(a) 7.00% per annum, compounded annually or (b) the highest rate permitted by
law. This Note is one of a series of Convertible Promissory Notes containing
substantially identical terms and conditions issued pursuant to that certain
Series C Preferred Stock Purchase Agreement, dated March 1, 2000 (the "Purchase
Agreement"). Such Notes are referred to herein as the "Notes," and the holders
thereof are referred to herein as the "Holders." This Note is subject to the
following terms and conditions.

     1.   Maturity.  Unless converted as provided in Section 2, this Note will
automatically mature and be due and payable on May 31, 2000 (the "Maturity
Date"). Subject to Section 2 below, any interest shall accrue on this Note but
shall not be due and payable until the Maturity Date.

     2.   Conversion

          (a)  HSR Clearance.  As soon as practicable after the Closing (as
defined in the Purchase Agreement), the Company and the Holder hereby agree to
file or to cause to be filed with the United States Federal Trade Commission
(the "FTC") and the Antitrust Division of the United States Department of
Justice (the "DOJ") pursuant to the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended (the "HSR Act") all requisite documents and notifications in
order to provide for the conversion of this Note into shares of the Company's
Series C Preferred Stock. Upon the earlier of one business day after (i) the
date all required clearances or pre-termination notices under the HSR Act have
been received from the FTC and the DOJ (or all applicable waiting periods have
expired) or (ii) the date the Holder and the Company are no longer required by
law to make filings under the HSR to convert this Note into capital stock, the
entire principal amount of this Note shall automatically convert into fully-paid
and non-assessable shares of the Company's Series C Preferred Stock (the
"Stock"); provided,

                                       1.
<PAGE>

however, the automatic conversion of such principal amount into shares of the
Stock shall be conditioned upon (A) the Company having provided to the Holder a
compliance certificate in the form attached hereto as Exhibit A or (B) the
Holder having waived such applicable terms, conditions or certifications
included in such certificate, either individually or in the aggregate. The
number of shares of Stock to be issued upon such conversion shall be equal to
the quotient obtained by dividing (i) the entire outstanding principal amount of
this Note by (ii) $11.894142 (as adjusted for any future stock splits, stock
dividends, recapitalizations or the like to the Stock), provided that no
fractional shares shall be issued. In the event that the required clearances
from the FTC and the DOJ are not obtained, this Note shall not be convertible
into the Stock.

          (b)  Redemption. In the event the Company consummates a Liquidity
Event (as defined below) prior to the conversion of this note pursuant to
Section 2(a), then the Company shall redeem this Note for an aggregate
consideration substantially equivalent to the consideration which would have
been received by the Holder had the Note been converted into Series C Preferred
Stock immediately prior to the consummation of such Liquidity Event, as
determined in the reasonable and good faith judgement of the Board of Directors
of the Company. For the Purposes of hereof "Liquidity Event" shall mean (i) any
consolidation or merger of the Company with or into any other corporation or
other entity or person, or any other corporate reorganization, in which the
stockholders of the Company immediately prior to such consolidation, merger or
reorganization, own less than 50% of the Company's voting power immediately
after such consolidation, merger or reorganization, or any transaction or series
of related transactions to which the Company is a party in which in excess of
50% of the Company's voting power is transferred (ii) any voluntary or
involuntary liquidation or dissolution of the Company, or (iii) the sale of all
or substantially all the assets of the Company.

          (c)  Mechanics and Effect of Conversion. No fractional shares of the
Company's capital stock will be issued upon conversion of this Note. In lieu of
any fractional share to which the Holder would otherwise be entitled, the
Company will pay to the Holder in cash the amount of the unconverted principal
and interest balance of this Note that would otherwise be converted into such
fractional share. Upon conversion of this Note pursuant to this Section 2, the
Holder shall surrender this Note, duly endorsed, at the principal offices of the
Company or any transfer agent of the Company. At its expense, the Company will,
as soon as practicable thereafter, issue and deliver to such Holder, at such
principal office, a certificate or certificates for the number of shares to
which such Holder is entitled upon such conversion, together with any other
securities and property to which the Holder is entitled upon such conversion
under the terms of this Note, including a check payable to the Holder for any
cash amounts payable as described herein. Upon conversion of this Note, the
Company will be forever released from all of its obligations and liabilities
under this Note with regard to that portion of the principal amount and accrued
interest being converted including without limitation the obligation to pay such
portion of the principal amount and accrued interest.

     3.   Payment.  All payments shall be made in lawful money of the United
States of America at such place as the Holder hereof may from time to time
designate in writing to the Company. Payment shall be credited first to the
accrued interest then due and payable and the remainder applied to principal.
Prepayment of this Note may be made without penalty, if the Company's Board of
Directors has determined, in consultation with legal counsel, and with the

                                       2.
<PAGE>

consent of the Holders of a majority of the outstanding principal amount of the
Notes, that the required clearances or pre-termination notices under the HSR Act
specified in Section 2(a) are not likely to be obtained, otherwise this note
made not prepaid without the consent of the Holders of a majority of the
outstanding principal amount of the Notes; provided, however, that the Company
may repay the Note on or after May 31, 2000 in the event the conditions to
conversion set forth in Section 2 hereof have not occurred.

     4.   Transfer; Successors and Assigns.  The terms and conditions of this
Note shall inure to the benefit of and be binding upon the respective successors
and assigns of the parties. Notwithstanding the foregoing, the Company may not
assign, pledge or otherwise transfer this Note without the prior written consent
of the Holder, which shall not be unreasonably withheld, and the Holder may not
assign, pledge, or otherwise transfer this Note without the prior written
consent of the Company, which shall not be unreasonably withheld. Subject to the
preceding sentence, this Note may be transferred only upon surrender of the
original Note for registration of transfer, duly endorsed, or accompanied by a
duly executed written instrument of transfer in form satisfactory to the Holder.
Thereupon, a new note for the same principal amount and interest will be issued
to, and registered in the name of, the transferee. Interest and principal are
payable only to the registered holder of this Note.

     5.   Governing Law. This Note and all acts and transactions pursuant hereto
and the rights and obligations of the parties hereto shall be governed,
construed and interpreted in accordance with the laws of the State of
Washington, without giving effect to principles of conflicts of law.

     6.   Notices.  Any notice required or permitted by this Note shall be in
writing and shall be deemed sufficient upon delivery, when delivered personally
or one business day after being sent by a nationally-recognized overnight
delivery service (such as Federal Express or UPS), or forty-eight (48) hours
after being deposited in the U.S. mail, as certified or registered mail, with
postage prepaid, addressed to the party to be notified at such party's address
as set forth below or as subsequently modified by written notice.

     7.   Amendments and Waivers.  Any term of this Note may be amended only
with the written consent of the Company and at least a majority in interest of
the Holders. Any amendment or waiver effected in accordance with this Section 7
shall be binding upon the Company, the Holders and each transferee of the Notes.

     8.   Waiver.  The Company waives presentment and demand for payment, notice
of dishonor, protest and notice of protest of this Note, and shall pay all costs
of collection when incurred, including, without limitation, reasonable
attorneys' fees, costs and other expenses.

     The right to plead any and all statutes of limitations as a defense to any
demands hereunder is hereby waived to the full extent permitted by law.

                                       3.
<PAGE>

     ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON
LAW.
                                   COMPANY:

                                   Mercata, Inc.

                                   By:________________________________

                                      Tom Van Horn
                                      President

                                   Address:  110-110th Avenue Northeast,
                                             Suite 360
                                             Bellevue, WA 98004

AGREED TO AND ACCEPTED:

Waelinvest

By:__________________________

Name:________________________

Title:_______________________

Address:  102 rue Waelhem
          1030 Bruxelles
          Belgium

                 SIGNATURE PAGE TO CONVERTIBLE PROMISSORY NOTE

                                       4.
<PAGE>

                 Exhibit A to the Convertible Promissory Note

                            COMPLIANCE CERTIFICATE

     The undersigned, _______________, the President and Chief Executive Officer
of Mercata, Inc., a Delaware corporation (the "Company"), certifies that he is
authorized to execute this Compliance Certificate for and on behalf of the
Company, and further certifies that:

     1.   The representations and warranties of the Company contained in Section
3.19 of the Series C Preferred Stock Purchase Agreement, dated ____________,
2000 (the "Purchase Agreement"), are true and correct as though made on and as
of the date hereof.

     2.   The Company has performed or fulfilled all covenants, agreements and
conditions contained in the Purchase Agreement and that certain Convertible
Promissory Note, dated ______________, 2000, in the amount of $9,999,999.89 of
the Company in favor of Waelinvest to be performed or fulfilled by the Company
on or prior to the date hereof.

     In Witness Whereof, the undersigned has hereunto set his hand this _______
day of _________________, 2000.

                                   Mercata, Inc.

                                   By:_________________________

                                   Name:_______________________

                                   Title:______________________

                      EXHIBIT A -- COMPLIANCE CERTIFICATE

                                      5.<PAGE>

                                                                   EXHIBIT 10.17

                                 MERCATA, INC.

                             AMENDED AND RESTATED
                           INVESTOR RIGHTS AGREEMENT

                                 March 1, 2000
<PAGE>

                               Table Of Contents

<TABLE>
<CAPTION>
                                                                                  Page
<S>                                                                               <C>
SECTION 1.  GENERAL..............................................................    1
     1.1    Definitions..........................................................    1
SECTION 2.  REGISTRATION; RESTRICTIONS ON TRANSFER...............................    3
     2.1    Restrictions on Transfer.............................................    3
     2.2    Demand Registration..................................................    4
     2.3    Piggyback Registrations..............................................    5
     2.4    Form S-3 Registration................................................    6
     2.5    Expenses of Registration.............................................    7
     2.6    Obligations of the Company...........................................    8
     2.7    Termination of Registration Rights...................................    9
     2.8    Delay of Registration; Furnishing Information........................    9
     2.9    Indemnification......................................................    9
     2.10   Assignment of Registration Rights....................................   11
     2.11   Amendment of Registration Rights.....................................   12
     2.12   Limitation on Subsequent Registration Rights.........................   12
     2.13   "Market Stand-Off" Agreement; Agreement to Furnish Information.......   12
     2.14   Rule 144 Reporting...................................................   13
SECTION 3.  COVENANTS OF THE COMPANY.............................................   13
     3.1    Basic Financial Information and Reporting............................   13
     3.2    Inspection Rights....................................................   14
     3.3    Confidentiality of Records...........................................   14
     3.4    Reservation of Common Stock..........................................   14
     3.5    Stock Vesting........................................................   14
     3.6    Proprietary Information and Inventions Agreement.....................   15
     3.7    Assignment of Right of First Refusal.................................   15
     3.8    Termination of Covenants.............................................   15
SECTION 4.  RIGHTS OF FIRST REFUSAL..............................................   15
     4.1    Subsequent Offerings.................................................   15
     4.2    Exercise of Rights...................................................   16
     4.3    Issuance of Equity Securities to Other Persons.......................   16
</TABLE>

                                      i.
<PAGE>

                               Table Of Contents
                                  (Continued)

<TABLE>
<CAPTION>
                                                                                  Page
<S>                                                                               <C>
     4.4    Sale Without Notice..................................................   16
     4.5    Termination and Waiver of Rights of First Refusal....................   16
     4.6    Transfer of Rights of First Refusal..................................   17
     4.7    Excluded Securities..................................................   17
SECTION 5.  MISCELLANEOUS........................................................   17
     5.1    Governing Law........................................................   17
     5.2    Survival.............................................................   17
     5.3    Successors and Assigns...............................................   18
     5.4    Entire Agreement.....................................................   18
     5.5    Severability.........................................................   18
     5.6    Amendment and Waiver.................................................   18
     5.7    Delays or Omissions..................................................   18
     5.8    Notices..............................................................   19
     5.9    Attorneys' Fees......................................................   19
     5.10   Titles and Subtitles.................................................   19
     5.11   Additional Investors.................................................   19
     5.12   Counterparts.........................................................   19
     5.13   Consent and Waiver...................................................   19
     5.14   Amendment of Prior Investor Rights Agreement.........................   19
</TABLE>

                                      ii.
<PAGE>

                                 MERCATA, INC.
                 AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

          This Amended and Restated Investor Rights Agreement (the "Agreement")
is entered into as of the lst day of March, 2000, by and among Mercata, Inc., a
Delaware corporation (the "Company"), the holders of the Company's Series A
Preferred Stock (the "Series A Holders"), the holders of the Company's Series B
Preferred Stock ("Series B Holders") and the purchasers of the Company's Series
C Preferred Stock (the "Series C Stock") set forth on Exhibit A of that certain
Series C Preferred Stock Purchase Agreement of even date herewith (the "Purchase
Agreement") and Exhibit A hereto.  The Series A Holders, the Series B Holders
and the purchasers of the Series C Stock shall be referred to hereinafter as the
"Investors" and each individually as an "Investor."

                                    Recitals

          Whereas, the Company proposes to sell and issue up to three million
three hundred sixty three thousand (3,363,000) shares of its Series C Stock
pursuant to the Purchase Agreement;

          Whereas, the Company, the Series A Holders and the Series B Holders
have entered into that certain Investor Rights Agreement, dated as of September
30, 1999, as amended (the "Prior Investor Rights Agreement"), and desire to
amend and restate such agreement with the terms and conditions of the Agreement;
and

          Whereas, as a condition of entering into the Purchase Agreement, the
Investors have requested that the Company extend to them registration rights,
information rights and other rights as set forth below.

          Now, Therefore, in consideration of the mutual promises,
representations, warranties, covenants and conditions set forth in this
Agreement and in the Purchase Agreement, the parties mutually agree as follows:

SECTION 1.      GENERAL

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

                "Affiliate" of a person or entity means any person or entity who
controls, is controlled by or under common control with such person or entity
and, for each person or entity that is listed in the definition of Amerindo,
"Affiliate" shall include such other persons and entities listed in the
definition of Amerindo.

                "Amerindo" means Amerindo Technology Growth Fund II, Inc.,
Vertex Captial II LLC, Vertex Capital III LLC, Sands Brothers/Amerindo
Technology Associates LLC, Sands Brothers/Amerindo Technology Associates
Institution LLC, Sands Brothers/Amerindo

                                      1.
<PAGE>

Technology Offshore Associates LLC, Litton Master Trust, James Stableford and
Aurora Technology Fund LLC.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended.

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

          "Holder" means any person owning of record Registrable Securities that
have not been sold to the public or any assignee of record of such Registrable
Securities in accordance with Section 2.10 hereof.

          "Initial Offering" means the Company's first firm commitment
underwritten public offering of its Common Stock registered under the Securities
Act.

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

          "Registrable Securities" means (a) Common Stock of the Company that
are part of the Shares; (b) Common Stock of the Company issued or issuable upon
conversion of the Shares; and (c) any Common Stock of the Company issued as (or
issuable upon the conversion or exercise of any warrant, right or other security
which is issued as) a dividend or other distribution with respect to, or in
exchange for or in replacement of, such above-described securities.
Notwithstanding the foregoing, Registrable Securities shall not include any
securities sold by a person to the public either pursuant to a registration
statement or Rule 144 or sold in a private transaction in which the transferor's
rights under Section 2 of this Agreement are not assigned.

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

          "Registration Expenses" shall mean all expenses incurred by the
Company in complying with Sections 2.2, 2.3 and 2.4 hereof, including, without
limitation, all registration and filing fees, printing expenses, fees and
disbursements of counsel for the Company, reasonable fees and disbursements not
to exceed twenty-five thousand dollars ($25,000) of a single special counsel for
the Holders, blue sky fees and expenses and the expense of any special audits
incident to or required by any such registration (but excluding the compensation
of regular employees of the Company which shall be paid in any event by the
Company).

          "SEC" or "Commission" means the Securities and Exchange Commission.

          "Securities Act" shall mean the Securities Act of 1933, as amended.

                                      2.
<PAGE>

          "Selling Expenses" shall mean all underwriting discounts and selling
commissions applicable to the sale.

          "Shares" shall mean the one million (1,000,000) shares of Common Stock
currently held by Vulcan Ventures Incorporated, the Company's Series A Preferred
Stock issued pursuant to that certain Series A Preferred Stock Purchase
Agreement, dated March 17, 1999, and the Company's Series B Stock issued
pursuant to that certain Series B Preferred Stock Purchase Agreement, dated
September 30, 1999, and the Company's Series C Preferred Stock issued pursuant
to the Purchase Agreement and held by the Investors listed on Exhibit A hereto
and their permitted assigns.

SECTION 2.  REGISTRATION; RESTRICTIONS ON TRANSFER

  2.1     Restrictions on Transfer.

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

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

              (ii)   (A) The transferee has agreed in writing to be bound by the
terms of this Agreement, (B) such Holder shall have notified the Company of the
proposed disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed disposition, and (C) if
reasonably requested by the Company, such Holder shall have furnished the
Company with an opinion of counsel, reasonably satisfactory to the Company, that
such disposition will not require registration of such shares under the
Securities Act. It is agreed that the Company will not require opinions of
counsel for transactions made pursuant to Rule 144 except in unusual
circumstances.

              (iii)  Notwithstanding the provisions of paragraphs (i) and (ii)
above, no such registration statement or opinion of counsel shall be necessary
for a transfer by a Holder which is (A) a partnership to its partners or former
partners in accordance with partnership interests, (B) a corporation to its
shareholders in accordance with their interest in the corporation, (C) a limited
liability company to its members or former members in accordance with their
interest in the limited liability company, or (D) to the Holder's family member
or trust for the benefit of an individual Holder; provided that in each case the
transferee will be subject to the terms of this Agreement to the same extent as
if he were an original Holder hereunder.

          (b) Each certificate representing Shares or Registrable Securities
shall (unless otherwise permitted by the provisions of the Agreement) be stamped
or otherwise imprinted with a legend substantially similar to the following (in
addition to any legend required under applicable state securities laws):

     THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
     THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED,
     SOLD OR OTHERWISE

                                      3.
<PAGE>

       TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND
       UNTIL REGISTERED UNDER THE ACT OR UNLESS THE COMPANY HAS
       RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
       AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.

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

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

  2.2  Demand Registration.

       (a) Subject to the conditions of this Section 2.2, if the Company shall
receive a written request from the Holders (the "Initiating Holders") proposing
to sell Registrable Securities at an anticipated aggregate offering price, net
of underwriting discounts and commissions, exceeding twenty-five million dollars
($25,000,000) (a "Qualified Public Offering")), then the Company shall, within
thirty (30) days of the receipt thereof, give written notice of such request to
all Holders, and subject to the limitations of this Section 2.2, use its best
efforts to effect, as soon as practicable, the registration under the Securities
Act of all Registrable Securities that the Holders request to be registered.

       (b) If the Initiating Holders intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall so
advise the Company as a part of their request made pursuant to this Section 2.2
or any request pursuant to Section 2.4 and the Company shall include such
information in the written notice referred to in Section 2.2(a) or Section
2.4(a), as applicable.  In such event, the right of any Holder to include its
Registrable Securities in such registration shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent provided herein.  All
Holders proposing to distribute their securities through such underwriting shall
enter into an underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting by a majority in interest of the
Initiating Holders (which underwriter or underwriters shall be reasonably
acceptable to the Company).  Notwithstanding any other provision of this Section
2.2 or Section 2.4, if the underwriter advises the Company that marketing
factors require a limitation of the number of securities to be underwritten
(including Registrable Securities) then the Company shall so advise all Holders
of Registrable Securities which would otherwise be underwritten pursuant hereto,
and the number of shares that may be included in the underwriting shall be
allocated to the Holders of such Registrable Securities on a pro rata basis
based on the number of Registrable Securities held by all such Holders
(including the Initiating Holders); provided, however, that the number of shares
of Registrable Securities to be included in such underwriting and registration
shall not be

                                      4.
<PAGE>

reduced unless all other securities of the Company are first entirely excluded
from the underwriting and registration. Any Registrable Securities excluded or
withdrawn from such underwriting shall be withdrawn from the registration.

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

            (i)    prior to one hundred eighty (180) days following the
effective date of the registration statement pertaining to the Initial Offering;

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

            (iii)  if the Company shall furnish to Holders requesting a
registration statement pursuant to this Section 2.2, a certificate signed by the
Chairman of the Board stating that in the good faith judgment of the Board of
Directors of the Company, it would be seriously detrimental to the Company and
its shareholders for such registration statement to be effected at such time, in
which event the Company shall have the right to defer such filing for a period
of not more than ninety (90) days after receipt of the request of the Initiating
Holders; provided that such right to delay a request shall be exercised by the
Company not more than once in any twelve (12) month period; or

            (iv)   if the Initiating Holders propose to dispose of shares of
Registrable Securities that may be immediately registered on Form S-3 pursuant
to a request made pursuant to Section 2.4 below.

  2.3     Piggyback Registrations.  The Company shall notify all Holders of
Registrable Securities in writing at least fifteen (15) days prior to the filing
of any registration statement under the Securities Act for purposes of a public
offering of securities of the Company (including, but not limited to,
registration statements relating to secondary offerings of securities of the
Company, but excluding registration statements relating to employee benefit
plans or with respect to corporate reorganizations or other transactions under
Rule 145 of the Securities Act) and will afford each such Holder an opportunity
to include in such registration statement all or part of such Registrable
Securities held by such Holder.  Each Holder desiring to include in any such
registration statement all or any part of the Registrable Securities held by it
shall, within ten (10) days after the above-described notice from the Company,
so notify the Company in writing.  Such notice shall state the intended method
of disposition of the Registrable Securities by such Holder.  If a Holder
decides not to include all of its Registrable Securities in any registration
statement thereafter filed by the Company, such Holder shall nevertheless
continue to have the right to include any Registrable Securities in any
subsequent registration statement or registration statements as may be filed by
the Company with respect to offerings of its securities, all upon the terms and
conditions set forth herein.

          (a) Underwriting. If the registration statement under which the
Company gives notice under this Section 2.3 is for an underwritten offering, the
Company shall so advise the Holders of Registrable Securities. In such event,
the right of any such Holder to be included in a registration pursuant to this
Section 2.3 shall be conditioned upon such Holder's

                                      5.
<PAGE>

participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent provided herein. All
Holders proposing to distribute their Registrable Securities through such
underwriting shall enter into an underwriting agreement in customary form with
the underwriter or underwriters selected for such underwriting by the Company.
Notwithstanding any other provision of the Agreement, if the underwriter
determines in good faith that marketing factors require a limitation of the
number of shares to be underwritten, the number of shares that may be included
in the underwriting shall be allocated, first, to the Company; second, to the
Holders on a pro rata basis based on the total number of Registrable Securities
held by the Holders; and third, to any shareholder of the Company (other than a
Holder) on a pro rata basis. No such reduction shall (i) reduce the securities
being offered by the Company for its own account to be included in the
registration and underwriting, or (ii) reduce the amount of securities of the
selling Holders included in the registration below twenty-five percent (25%) of
the total amount of securities included in such registration, unless such
offering is the Initial Offering and such registration does not include shares
of any other selling shareholders, in which event any or all of the Registrable
Securities of the Holders may be excluded in accordance with the immediately
preceding sentence. In no event will shares of any other selling shareholder be
included in such registration which would reduce the number of shares which may
be included by Holders without the written consent of Holders of not less than a
majority of the Registrable Securities proposed to be sold in the offering. If
any Holder disapproves of the terms of any such underwriting, such Holder may
elect to withdraw therefrom by written notice to the Company and the
underwriter, delivered at least ten (10) business days prior to the effective
date of the registration statement. Any Registrable Securities excluded or
withdrawn from such underwriting shall be excluded and withdrawn from the
registration. For any Holder which is a partnership or corporation, the
partners, retired partners and shareholders of such Holder, or the estates and
family members of any such partners and retired partners and any trusts for the
benefit of any of the foregoing person shall be deemed to be a single "Holder",
and any pro rata reduction with respect to such "Holder" shall be based upon the
aggregate amount of shares carrying registration rights owned by all entities
and individuals included in such "Holder," as defined in this sentence.

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

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

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

          (b) as soon as practicable, effect such registration and all such
qualifications and compliances as may be so requested and as would permit or
facilitate the sale and

                                      6.
<PAGE>

distribution of all or such portion of such Holder's or Holders' Registrable
Securities as are specified in such request, together with all or such portion
of the Registrable Securities of any other Holder or Holders joining in such
request as are specified in a written request given within fifteen (15) days
after receipt of such written notice from the Company; provided, however, that
the Company shall not be obligated to effect any such registration,
qualification or compliance pursuant to this Section 2.4:

              (i)    if Form S-3 (or any successor or similar form) is not
available for such offering by the Holders, or

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

              (iii)  if within thirty (30) days of receipt of a written request
from  any Holder or Holders pursuant to this Section 2.4, the Company gives
notice to such Holder or Holders of the Company's intention to make a public
offering within ninety (90) days;

              (iv)   if the Company shall furnish to the Holders a certificate
signed by the Chairman of the Board of Directors of the Company stating that in
the good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such Form S-3
registration to be effected at such time, in which event the Company shall have
the right to defer the filing of the Form S-3 registration statement for a
period of not more than ninety (90) days after receipt of the request of the
Holder or Holders under this Section 2.4; provided, that such right to delay a
request shall be exercised by the Company not more than once in any twelve (12)
month period, or

              (v)    in any particular jurisdiction in which the Company would
be required to qualify to do business or to execute a general consent to service
of process in effecting such registration, qualification or compliance.

          (c) Subject to the foregoing, the Company shall file a Form S-3
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders.  Registrations effected pursuant to this
Section 2.4 shall not be counted as demands for registration or registrations
effected pursuant to Sections 2.2 or 2.3, respectively.

  2.5     Expenses of Registration.  Except as specifically provided herein, all
Registration Expenses incurred in connection with any registration,
qualification or compliance pursuant to Section 2.2 or any registration under
Section 2.3 or Section 2.4 herein shall be borne by the Company.  All Selling
Expenses incurred in connection with any registrations hereunder, shall be borne
by the holders of the securities so registered pro rata on the basis of the
number of shares so registered.  The Company shall not, however, be required to
pay for expenses of any registration proceeding begun pursuant to Section 2.2 or
2.4, the request of which has been subsequently withdrawn by the Initiating
Holders unless (a) the withdrawal is based upon material adverse information
concerning the Company of which the Initiating Holders were not

                                      7.
<PAGE>

aware at the time of such request or (b) the Holders of a majority of
Registrable Securities agree to forfeit their right to one requested
registration pursuant to Section 2.2 or Section 2.4, as applicable, in which
event such right shall be forfeited by all Holders. If the Holders are required
to pay the Registration Expenses, such expenses shall be borne by the holders of
securities (including Registrable Securities) requesting such registration in
proportion to the number of shares for which registration was requested. If the
Company is required to pay the Registration Expenses of a withdrawn offering
pursuant to clause (a) above, then the Holders shall not forfeit their rights
pursuant to Section 2.2 or Section 2.4 to a demand registration.

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

          (a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use all reasonable efforts to cause
such registration statement to become effective, and, upon the request of the
Holders of a majority of the Registrable Securities registered thereunder, keep
such registration statement effective for up to thirty (30) days or, if earlier,
until the Holder or Holders have completed the distribution related thereto. The
Company shall not be required to file, cause to become effective or maintain the
effectiveness of any registration statement that contemplates a distribution of
securities on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act.

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

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

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

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

          (f) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits

                                      8.
<PAGE>

to state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing.

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

  2.7     Termination of Registration Rights.  All registration rights granted
under this Section 2 shall terminate and be of no further force and effect three
(3) years after the date of the Company's Initial Offering.  In addition, a
Holder's registration rights shall expire if all Registrable Securities held by
and issuable to such Holder (and its affiliates, partners, former partners,
members and former members) may be sold under Rule 144 during any ninety (90)
day period.

  2.8     Delay of Registration; Furnishing Information.

          (a) No Holder shall have any right to obtain or seek an injunction
restraining or otherwise delaying any such registration as the result of any
controversy that might arise with respect to the interpretation or
implementation of this Section 2.

          (b) It shall be a condition precedent to the obligations of the
Company to take any action pursuant to Section 2.2, 2.3 or 2.4 that the selling
Holders shall furnish to the Company such information regarding themselves, the
Registrable Securities held by them and the intended method of disposition of
such securities as shall be required to effect the registration of their
Registrable Securities.

          (c) The Company shall have no obligation with respect to any
registration requested pursuant to Section 2.2 or Section 2.4 if, due to the
operation of subsection 2.2(b), the number of shares or the anticipated
aggregate offering price of the Registrable Securities to be included in the
registration does not equal or exceed the number of shares or the anticipated
aggregate offering price required to originally trigger the Company's obligation
to initiate such registration as specified in Section 2.2 or Section 2.4,
whichever is applicable.

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

          (a) To the extent permitted by law, the Company will indemnify and
hold harmless each Holder, the partners, officers and directors of each Holder,
any underwriter (as defined in the Securities Act) for such Holder and each
person, if any, who controls such Holder or underwriter within the meaning of
the Securities Act or the Exchange Act, against any losses, claims, damages, or
liabilities (joint or several) to which they may become subject under the
Securities Act, the Exchange Act or other federal or state law, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any of the

                                      9.
<PAGE>

following statements, omissions or violations (collectively a "Violation") by
the Company: (i) any untrue statement or alleged untrue statement of a material
fact contained in such registration statement, including any preliminary
prospectus or final prospectus contained therein or any amendments or
supplements thereto, (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not misleading, or (iii) any violation or alleged violation by the
Company of the Securities Act, the Exchange Act, any state securities law or any
rule or regulation promulgated under the Securities Act, the Exchange Act or any
state securities law in connection with the offering covered by such
registration statement; and the Company will pay as incurred to each such
Holder, partner, officer, director, underwriter or controlling person for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided however, that the indemnity agreement contained in this Section 2.9(a)
shall not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Company, which consent shall not be unreasonably withheld, nor shall the Company
be liable in any such case for any such loss, claim, damage, liability or action
to the extent that it arises out of or is based upon a Violation which occurs in
reliance upon and in conformity with written information furnished expressly for
use in connection with such registration by such Holder, partner, officer,
director, underwriter or controlling person of such Holder.

          (b) To the extent permitted by law, each Holder will, if Registrable
Securities held by such Holder are included in the securities as to which such
registration qualifications or compliance is being effected, indemnify and hold
harmless the Company, each of its directors, its officers and each person, if
any, who controls the Company within the meaning of the Securities Act, any
underwriter and any other Holder selling securities under such registration
statement or any of such other Holder's partners, directors or officers or any
person who controls such Holder, against any losses, claims, damages or
liabilities (joint or several) to which the Company or any such director,
officer, controlling person, underwriter or other such Holder, or partner,
director, officer or controlling person of such other Holder may become subject
under the Securities Act, the Exchange Act or other federal or state law,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereto) arise out of or are based upon any Violation, in each case to the
extent (and only to the extent) that such Violation occurs in reliance upon and
in conformity with written information furnished by such Holder under an
instrument duly executed by such Holder and stated to be specifically for use in
connection with such registration; and each such Holder will pay as incurred any
legal or other expenses reasonably incurred by the Company or any such director,
officer, controlling person, underwriter or other Holder, or partner, officer,
director or controlling person of such other Holder in connection with
investigating or defending any such loss, claim, damage, liability or action if
it is judicially determined that there was such a Violation; provided, however,
that the indemnity agreement contained in this Section 2.9(b) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of the Holder, which consent
shall not be unreasonably withheld; provided further, that in no event shall any
indemnity under this Section 2.9 exceed the proceeds from the offering received
by such Holder.

          (c) Promptly after receipt by an indemnified party under this Section
2.9 of notice of the commencement of any action (including any governmental
action), such indemnified party will, if a claim in respect thereof is to be
made against any indemnifying party

                                      10.
<PAGE>

under this Section 2.9, deliver to the indemnifying party a written notice of
the commencement thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume the defense
thereof with counsel mutually satisfactory to the parties; provided, however,
that an indemnified party shall have the right to retain its own counsel, with
the fees and expenses to be paid by the indemnifying party, if representation of
such indemnified party by the counsel retained by the indemnifying party would
be inappropriate due to actual or potential differing interests between such
indemnified party and any other party represented by such counsel in such
proceeding. The failure to deliver written notice to the indemnifying party
within a reasonable time of the commencement of any such action, if materially
prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section
2.9, but the omission so to deliver written notice to the indemnifying party
will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Section 2.9.

          (d) If the indemnification provided for in this Section 2.9 is held by
a court of competent jurisdiction to be unavailable to an indemnified party with
respect to any losses, claims, damages or liabilities referred to herein, the
indemnifying party, in lieu of indemnifying such indemnified party thereunder,
shall to the extent permitted by applicable law contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage or
liability in such proportion as is appropriate to reflect the relative fault of
the indemnifying party on the one hand and of the indemnified party on the other
in connection with the Violation(s) that resulted in such loss, claim, damage or
liability, as well as any other relevant equitable considerations.  The relative
fault of the indemnifying party and of the indemnified party shall be determined
by a court of law by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission to state a material
fact relates to information supplied by the indemnifying party or by the
indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission;
provided, that in no event shall any contribution by a Holder hereunder exceed
the proceeds from the offering received by such Holder.

          (e) The obligations of the Company and Holders under this Section 2.9
shall survive completion of any offering of Registrable Securities in a
registration statement and the termination of this agreement. No Indemnifying
Party, in the defense of any such claim or litigation, shall, except with the
consent of each Indemnified Party, consent to entry of any judgment or enter
into any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Indemnified Party of a release from
all liability in respect to such claim or litigation.

  2.10    Assignment of Registration Rights.  The rights to cause the Company to
register Registrable Securities pursuant to this Section 2 may be assigned by a
Holder to a transferee or assignee of Registrable Securities which (a) is an
Affiliate, general partner, limited partner, retired partner, member or retired
member of a Holder, (b) is a Holder's family member or trust for the benefit of
an individual Holder, or (c) acquires at least one hundred thousand (100,000)
shares of Registrable Securities (as adjusted for stock splits and
combinations); provided, however, (i) the transferor shall, within ten (10) days
after such transfer, furnish to the Company written notice of the name and
address of such transferee or assignee and the securities with

                                      11.
<PAGE>

respect to which such registration rights are being assigned and (ii) such
transferee shall agree to be subject to all restrictions set forth in this
Agreement.

  2.11    Amendment of Registration Rights.  Any provision of this Section 2 may
be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and the Holders of at least a majority of the
Registrable Securities then outstanding.  Any amendment or waiver effected in
accordance with this Section 2.11 shall be binding upon each Holder and the
Company.  By acceptance of any benefits under this Section 2, Holders of
Registrable Securities hereby agree to be bound by the provisions hereunder.

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

  2.13    "Market Stand-Off" Agreement; Agreement to Furnish Information.  Each
Holder hereby agrees that such Holder shall not sell, transfer, make any short
sale of, grant any option for the purchase of, or enter into any hedging or
similar transaction with the same economic effect as a sale, any Common Stock
(or other securities) of the Company held by such Holder (other than those
included in the registration) for a period specified by the representative of
the underwriters of Common Stock (or other securities) of the Company not to
exceed one hundred eighty (180) days following the effective date of a
registration statement of the Company filed under the Securities Act; provided
that:

          (a) such agreement shall apply only to the Company's Initial Offering;

          (b) all officers and directors of the Company enter into similar
agreements;

          (c) such agreement shall not apply to the purchase or sale of Common
Stock (or other securities registered by the Company) acquired in the Company's
Initial Offering (other than any shares that are purchased in the Initial
Offering as part of a directed share program) or on the open market after the
Company's Initial Offering by Amerindo.

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

                                      12.
<PAGE>

subject to the foregoing restriction until the end of said one hundred eighty
(180) day period.

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

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

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

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

SECTION 3.  COVENANTS OF THE COMPANY

  3.1       Basic Financial Information and Reporting.

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

            (b) As soon as practicable after the end of each fiscal year of the
Company, and in any event within one hundred twenty (120) days thereafter, the
Company will furnish to each Investor a balance sheet of the Company, as at the
end of such fiscal year, and a statement of income and a statement of cash flows
of the Company, for such year, all prepared in accordance with generally
accepted accounting principles consistently applied and setting forth in each
case in comparative form the figures for the previous fiscal year, all in
reasonable detail.  Such financial statements shall be accompanied by a report
and opinion thereon by independent public accountants of national standing
selected by the Company's Board of Directors.

            (c) The Company will furnish each Investor, as soon as practicable
after the end of the first, second and third quarterly accounting periods in
each fiscal year of the Company, and in any event within forty-five (45) days
thereafter, a balance sheet of the Company as of the end of each such quarterly
period, and a statement of income and a statement of cash flows of the Company
for such period and for the current fiscal year to date, prepared in accordance
with generally accepted accounting principles, with the exception that no notes
need be attached to such statements and year-end audit adjustments may not have
been made.

                                      13.
<PAGE>

          (d) So long as an Investor (with its Affiliates) shall own not less
than one million (1,000,000) shares of Registrable Securities (as adjusted for
stock splits, combinations and the like) (a "Major Investor"), the Company will
furnish each such Major Investor requesting such information as soon as
practicable after the end of each month, and in any event within twenty-one (21)
days thereafter, a balance sheet of the Company as of the end of each such month
and a statement of income and a statement of cash flows of the Company for such
month and for the current fiscal year to date prepared in accordance with
generally accepted accounting principles consistently applied, with the
exception that no notes need be attached to such statements and year-end audit
adjustments may not have been made.

  3.2     Inspection Rights.  Each Major Investor shall have the right to visit
and inspect any of the properties of the Company or any of its subsidiaries, and
to discuss the affairs, finances and accounts of the Company or any of its
subsidiaries with its officers, and to review such information as is reasonably
requested all at such reasonable times and as often as may be reasonably
requested; provided, however, that the Company shall not be obligated under this
Section 3.2 with respect to a competitor of the Company or with respect to
information which the Board of Directors determines in good faith is
confidential and should not, therefore, be disclosed.

  3.3     Confidentiality of Records. Each Investor agrees to use, and to use
its best efforts to insure that its authorized representatives use, the same
degree of care as such Investor uses to protect its own confidential information
to keep confidential any information furnished to it which the Company
identifies as being confidential or proprietary (so long as such information is
not in the public domain), except that such Investor may disclose such
proprietary or confidential information to any partner, subsidiary or parent of
such Investor for the purpose of evaluating its investment in the Company as
long as such partner, subsidiary or parent is advised of the confidentiality
provisions of this Section 3.3.

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

  3.5     Stock Vesting.  Unless otherwise approved by the Board of Directors,
all stock options and other stock equivalents issued after the date of this
Agreement to employees, directors, consultants and other service providers shall
be subject to vesting as follows:  (a) twenty-five percent (25%) of such stock
shall vest at the end of the first year following the earlier of the date of
issuance or such person's services commencement date with the company, and (b)
seventy-five percent (75%) of such stock shall vest over the remaining three (3)
years.  With respect to any shares of stock purchased by any such person, the
Company's repurchase option shall provide that upon such person's termination of
employment or service with the Company, with or without cause, the Company or
its assignee (to the extent permissible under applicable securities laws and
other laws) shall have the option to purchase at cost any unvested shares of
stock held by such person.

  3.6     Proprietary Information and Inventions Agreement.  The Company shall
require all employees to execute and deliver a Proprietary Information and
Inventions Agreement in the form attached to the Purchase Agreement.  The
Company shall require all consultants to

                                      14.
<PAGE>

execute and deliver an agreement containing confidentiality and other reasonably
protective provisions for the Company under the circumstances.

  3.7       Assignment of Right of First Refusal. In the event the Company
elects not to exercise any right of first refusal or right of first offer the
Company may have on a proposed transfer of any of the Company's outstanding
capital stock pursuant to the Company's charter documents, by contract or
otherwise, the Company shall, to the extent it may do so, assign such right of
first refusal or right of first offer to each Major Investor. In the event of
such assignment, each Major Investor shall have a right to purchase its pro rata
portion (as defined in Section 4.1) of the capital stock proposed to be
transferred.

  3.8       Termination of Covenants.  All covenants of the Company contained in
Section 3 of this Agreement shall expire and terminate as to each Investor upon
the earlier of (i) the effective date of the registration statement pertaining
to the Initial Offering or (ii) upon (a) the sale, lease or other disposition of
all or substantially all of the assets of the Company or (b) an acquisition of
the Company by another corporation or entity by consolidation, merger or other
reorganization in which the holders of the Company's outstanding voting stock
immediately prior to such transaction own, immediately after such transaction,
securities representing less than fifty percent (50%) of the voting power of the
corporation or other entity surviving such transaction, provided that this
Section 3.8(ii)(b) shall not apply to a merger effected exclusively for the
purpose of changing the domicile of the Company (a "Change in Control").

SECTION 4.  RIGHTS OF FIRST REFUSAL

  4.1       Subsequent Offerings.  So long as an Investor (with its Affiliates)
shall own not less than three hundred thousand (300,000) shares of Registrable
Securities (as adjusted for stock splits and combinations and the like) (a
"Significant Investor"), each such Significant Investor shall have a right of
first refusal to purchase its pro rata share of all Equity Securities, as
defined below, that the Company may, from time to time, propose to sell and
issue after the date of this Agreement, other than the Equity Securities
excluded by Section 4.7 hereof.  Each Investor's pro rata share is equal to the
ratio of (a) the number of shares of the Company's Common Stock (including all
shares of Common Stock issued or issuable upon conversion of the Shares) which
such Investor is deemed to be a holder immediately prior to the issuance of such
Equity Securities to (b) the total number of shares of the Company's outstanding
Common Stock (including all shares of Common Stock issued or issuable upon
conversion of the Shares or upon the exercise of any outstanding warrants or
options) immediately prior to the issuance of the Equity Securities.  The term
"Equity Securities" shall mean (i) any Common Stock, Preferred Stock or other
security of the Company, (ii) any security convertible, with or without
consideration, into any Common Stock, Preferred Stock or other security
(including any option to purchase such a convertible security), (iii) any
security carrying any warrant or right to subscribe to or purchase any Common
Stock, Preferred Stock or other security or (iv) any such warrant or right.

  4.2       Exercise of Rights.  If the Company proposes to issue any Equity
Securities, it shall give each Significant Investor written notice of its
intention, describing the Equity Securities, the price and the terms and
conditions upon which the Company proposes to issue the

                                      15.
<PAGE>

same. Each Significant Investor shall have fifteen (15) days from the giving of
such notice to agree to purchase its pro rata share of the Equity Securities for
the price and upon the terms and conditions specified in the notice by giving
written notice to the Company and stating therein the quantity of Equity
Securities to be purchased. Notwithstanding the foregoing, the Company shall not
be required to offer or sell such Equity Securities to any Significant Investor
who would cause the Company to be in violation of applicable federal securities
laws by virtue of such offer or sale.

  4.3     Issuance of Equity Securities to Other Persons.  If not all of the
Significant Investors elect to purchase their pro rata share of the Equity
Securities, then the Company shall promptly notify in writing the Significant
Investors who do so elect and shall offer such Significant Investors the right
to acquire such unsubscribed shares.  The Significant Investors shall have five
(5) days after receipt of such notice to notify the Company of its election to
purchase all or a portion thereof of the unsubscribed shares.  If the
Significant Investors fail to exercise in full the rights of first refusal, the
Company shall have ninety (90) days thereafter to sell the Equity Securities in
respect of which the Significant Investor's rights were not exercised, at a
price and upon general terms and conditions materially no more favorable to the
purchasers thereof than specified in the Company's notice to the Significant
Investors pursuant to Section 4.2 hereof.  If the Company has not sold such
Equity Securities within ninety (90) days of the notice provided pursuant to
Section 4.2, the Company shall not thereafter issue or sell any Equity
Securities, without first offering such securities to the Significant Investors
in the manner provided above.

  4.4     Sale Without Notice.  In lieu of giving notice to the Significant
Investors prior to the issuance of Equity Securities as provided in Section 4.2,
the Company may elect to give notice to the Significant Investors within thirty
(30) days after the issuance of Equity Securities.  Such notice shall describe
the type, price and terms of the Equity Securities.  Each Significant Investor
shall have twenty (20) days from the date of receipt of such notice to elect to
purchase its pro rata share of Equity Securities (as defined in Section 4.1, and
calculated before giving effect to the sale of the Equity Securities to the
purchasers thereof).  The closing of such sale shall occur within sixty (60)
days of the date of notice to the Significant Investors.

  4.5     Termination and Waiver of Rights of First Refusal.  The rights of
first refusal established by this Section 4 shall not apply to, and shall
terminate upon the earlier of (i) the effective date of the registration
statement pertaining to the Company's Initial Offering or (ii) a Change in
Control.  The rights of first refusal established by this Section 4 may be
amended, or any provision waived with the written consent of Significant
Investors holding a majority of the Registrable Securities held by all
Significant Investors, or as permitted by Section 5.6.

  4.6     Transfer of Rights of First Refusal.  The rights of first refusal of
each Significant Investor under this Section 4 may be transferred to the same
parties, subject to the same restrictions as any transfer of registration rights
pursuant to Section 2.10.

                                      16.
<PAGE>

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

          (a)  shares of Common Stock (and/or options, warrants or other Common
Stock purchase rights issued pursuant to such options, warrants or other rights)
issued or to be issued after the Original Issue Date (as defined in the
Company's Certificates of Incorporation) to employees, officers or directors of,
or consultants or advisors to the Company or any subsidiary, pursuant to stock
purchase or stock option plans or other arrangements that are approved by the
Board of Directors;

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

          (c)  any Equity Securities issued for consideration other than cash
pursuant to a merger, consolidation, acquisition or similar business
combination;

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

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

          (f)  any Equity Securities issued pursuant to any equipment leasing or
loan arrangement, or debt financing from a bank or similar financial or lending
institution;

          (g)  any Equity Securities that are issued by the Company pursuant to
a registration statement filed under the Securities Act; and

          (h)  shares of the Company's Common Stock or Preferred Stock issued in
connection with strategic transactions involving the Company and other entities,
including (i) joint ventures, manufacturing, marketing or distribution
arrangements or (ii) technology transfer or development arrangements; provided
that such strategic transactions and the issuance of shares therein, has been
approved by the Company's Board of Directors.

SECTION 5.  MISCELLANEOUS

     5.1  Governing Law. This Agreement shall be governed by and construed under
the laws of the State of Washington as applied to agreements among Washington
residents entered into and to be performed entirely within Washington.

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

                                      17.
<PAGE>

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

     5.4  Entire Agreement. This Agreement, the Exhibits and Schedules hereto,
the Purchase Agreement and the other documents delivered pursuant thereto
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and no party shall be liable or bound to any
other in any manner by any representations, warranties, covenants and agreements
except as specifically set forth herein and therein.

     5.5  Severability. In the event one or more of the provisions of this
Agreement should, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality, or unenforceability
shall not affect any other provisions of this Agreement, and this Agreement
shall be construed as if such invalid, illegal or unenforceable provision had
never been contained herein.

     5.6  Amendment and Waiver.

          (a)  Except as otherwise expressly provided, this Agreement may be
amended or modified only upon the written consent of the Company and the holders
of at least seventy percent (70%) of the Registrable Securities.

          (b)  Except as otherwise expressly provided, the obligations of the
Company and the rights of the Holders under this Agreement may be waived only
with the written consent of the holders of at least a majority of the
Registrable Securities.

          (c)  Notwithstanding the foregoing, this Agreement may be amended with
only the written consent of the Company to include additional purchasers of
Shares as "Investors," "Holders" and parties hereto.

     5.7  Delays or Omissions. It is agreed that no delay or omission to
exercise any right, power, or remedy accruing to any Holder, upon any breach,
default or noncompliance of the Company under this Agreement shall impair any
such right, power, or remedy, nor shall it be construed to be a waiver of any
such breach, default or noncompliance, or any acquiescence therein, or of any
similar breach, default or noncompliance thereafter occurring. It is further
agreed that any waiver, permit, consent, or approval of any kind or character on
any Holder's part of any breach, default or noncompliance under the Agreement or
any waiver on such Holder's part of any provisions or conditions of this
Agreement must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement, by law, or otherwise afforded to Holders, shall be cumulative and not
alternative.

                                      18.
<PAGE>

     5.8  Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (a) upon personal delivery to the
party to be notified, (b) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient; if not, then on the next business
day, (c) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid, or (d) one (1) day after deposit with
a nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the party
to be notified at the address as set forth on the signature pages hereof or
Exhibit A hereto or at such other address as such party may designate by ten
(10) days advance written notice to the other parties hereto.

     5.9  Attorneys' Fees. In the event that any suit or action is instituted to
enforce any provision in this Agreement, the prevailing party in such dispute
shall be entitled to recover from the losing party all fees, costs and expenses
of enforcing any right of such prevailing party under or with respect to this
Agreement, including without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals.

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

     5.11 Additional Investors. Notwithstanding anything to the contrary
contained herein, if the Company shall issue additional shares of its Preferred
Stock pursuant to the Purchase Agreement, any purchaser of such shares of
Preferred Stock may become a party to this Agreement by executing and delivering
an additional counterpart signature page to this Agreement and shall be deemed
an "Investor" hereunder.

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

     5.13 Consent and Waiver. Each "Investor" under the Prior Investor Rights
Agreement hereby:

          (a)  Consents, on behalf of all such "Investors", under Section 2.12
of the Prior Investor Rights Agreement, to the registration rights granted to
the Holders hereunder, and

          (b)  Waives, on behalf of all such "Investors", such "Investors"
rights of first refusal and related rights to notice, under Section 4 and
Section 5.6 of the Prior Rights Agreement as they apply to the purchase of
shares of stock being purchased and sold by the Company pursuant to the Purchase
Agreement.

     5.14 Amendment of Prior Investor Rights Agreement. The Prior Investor
Rights Agreement is hereby amended in its entirety and restated herein. Such
amendment and restatement is effective upon the execution of the Agreement by
the Company, the holders of at least seventy percent (70%) of the "Registrable
Securities" (as defined in the Prior Investors Rights Agreement). Upon such
execution, all provisions of, rights granted and covenants made in the Prior
Agreement are hereby waived, released and amended on their entirety and shall
have no further force and effect.

                                      19.
<PAGE>

                     [THIS SPACE INTENTIONALLY LEFT BLANK]

                                      20.
<PAGE>

     In Witness Whereof, the parties hereto have executed this Amended and
Restated Investor Rights Agreement as of the date set forth in the first
paragraph hereof.

                                        COMPANY:

                                        Mercata, Inc.

                                        By: /s/ Tom Van Horn
                                            -------------------------------
                                            Tom Van Horn
                                            President

                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                        INVESTOR(S):

                                        Vulcan Ventures Incorporated

                                        By: /s/ William D. Savoy
                                           ---------------------------------
                                            William D. Savoy
                                            Vice President

                                        /s/ William D. Savoy
                                        ------------------------------------
                                        William D. Savoy

                                        /s/ Bert Kolde
                                        ------------------------------------
                                        Bert Kolde

                                        /s/ Diane Daggatt
                                        ------------------------------------
                                        Diane Daggatt

                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                        INVESTOR(S):

                                        Highland Capital Partners IV Limited
                                        Partnership

                                         By: Highland Management Partners IV LLC
                                             Its: General Partner

                                             By: /s/ Daniel Nova
                                                 ------------------------------
                                                  Member

                                        Highland Entrepreneurs' Fund IV Limited
                                        Partnership

                                         By: Highland Management Partners IV LLC
                                             Its: General Partner

                                             By: /s/ Daniel Nova
                                                 -------------------------------
                                                 Member

                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                        INVESTOR(S):

                                        Amerindo Technology Growth Fund II, Inc.

                                        By: /s/ Gary A. Tanaka
                                           -----------------------------------
                                        Name: Gary A. Tanaka
                                              --------------------------------
                                        Title: Director
                                               -------------------------------
                                        Vertex Capital II LLC

                                        By: /s/ [ILLEGIBLE]
                                            ----------------------------------
                                        Name: [ILLEGIBLE]
                                             ---------------------------------
                                        Title:________________________________

                                        Vertex Capital III LLC

                                        By: /s/ [ILLEGIBLE]
                                           -----------------------------------
                                        Name: [ILLEGIBLE]
                                             ---------------------------------
                                        Title:________________________________

                                        Sands Brothers/Amerindo Technology
                                        Associates LLC

                                        By: /s/ Martin S. Sands
                                           -----------------------------------
                                        Name: Martin S. Sands
                                             ---------------------------------
                                        Title: Manager
                                              --------------------------------

                                        Sands Brothers/Technology Associates
                                        Institution LLC

                                        By: /s/ Martin S. Sands
                                           -----------------------------------
                                        Name: Martin S. Sands
                                             ---------------------------------
                                        Title: Manager
                                              --------------------------------

                                        Sands Brothers/Amerindo Technology
                                        Offshore Associates LLC

                                        By: /s/ Martin S. Sands
                                           ------------------------------------
                                        Name: Martin S. Sands
                                             ----------------------------------
                                        Title: Manager
                                              ---------------------------------
                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                        Litton Master Trust

                                        By: /s/ Joaguin Garcia-Larrieu
                                           -------------------------------------
                                        Name: Joaguin Garcia-Larrieu
                                             -----------------------------------
                                        Title: Attorney-in-Fact
                                              ----------------------------------

                                        /s/ James Stableford
                                        ----------------------------------------
                                        James Stableford

                                        Aurora Technology Fund LLC

                                        By: /s/ [ILLEGIBLE]
                                        Name:___________________________________
                                        Title:__________________________________

                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                        INVESTOR(S):

                                        Beagle Limited

                                        By:_____________________________________

                                        Name:___________________________________

                                        Title:__________________________________

                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                        INVESTOR(S):

                                        Global Retail Partners, L.P.
                                         By: Global Retail Partners, Inc.
                                             Its: General Partner

                                        By: /s/ Osamu R. Watanabe
                                           -------------------------------------
                                        Name: Osamu R. Watanabe
                                             -----------------------------------
                                        Title: Vice President
                                              ----------------------------------

                                        DLJ Diversified Partners, L.P.
                                         By: DLJ Diversified Partners, Inc.
                                             Its: General Partner

                                       By: /s/ Osamu R. Watanabe
                                           -------------------------------------
                                       Name:  Osamu R. Watanabe
                                             -----------------------------------
                                       Title:  Vice President
                                              ----------------------------------

                                         By: DLJ Diversified Partners, Inc.
                                             Its: General Partner

                                        By: /s/ Osamu R. Watanabe
                                           -------------------------------------
                                        Name: Osamu R. Watanabe
                                             -----------------------------------
                                        Title: Vice President
                                              ----------------------------------

                                        GRP Partners, L.P.
                                         By: Global Retail Partners, Inc.
                                             Its: General Partner

                                        By: /s/ Osamu R. Watanabe
                                           -------------------------------------
                                        Name: Osamu R. Watanabe
                                             -----------------------------------
                                        Title: Vice President
                                              ----------------------------------

                                        Global Retail Partners Funding, Inc.

                                        By: /s/ Osamu R. Watanabe
                                           -------------------------------------
                                        Name: Osamu R. Watanabe
                                             -----------------------------------
                                        Title: Vice President
                                              ----------------------------------

                                        DLJ ESC II, L.P.
                                         By: DLJ LBO Plans Management
                                             Corporation
                                             Its: General Partner

                                        By: /s/ Osamu R. Watanabe
                                           -------------------------------------
                                        Name: Osamu R. Watanabe
                                             -----------------------------------
                                        Title: Vice President
                                              ----------------------------------

                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                        INVESTOR(S):

                                        Waelinvest

                                        By: /s/ Freddy De Greef
                                           -------------------------------------

                                        Name: Freddy De Greef
                                           -------------------------------------

                                        Title: C.E.O.
                                              ----------------------------------

                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                        INVESTOR(S):

                                        Watershed Capital I, L.P.

                                        By: Watershed Capital G.P. I, L.P.
                                            Its: General Partner

                                            By: Watershed Capital G.P. I, L.L.C.
                                                Its: General Partner

                                            By: ________________________________
                                                Ralph C. Derrickson
                                                Managing Member

                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                        INVESTOR(S):

                                        TWP Mercata Investors

                                        By: /s/ David A. Baylor
                                            -----------------------------------
                                            David A. Baylor
                                            Managing Partner

                    SIGNATURE PAGE TO AMENDED AND RESTATED
                          INVESTORS RIGHTS AGREEMENT
<PAGE>

                                   Exhibit A

                             SCHEDULE OF INVESTORS

Name and Address

Vulcan Ventures Incorporated
110 - 110th Avenue N.E., Suite 550
Bellevue, WA 98004

Highland Capital Partners IV Limited Partnership
Two International Place
Boston, MA 02110

Highland Entrepreneurs' Fund IV Limited Partnership
Two International Place
Boston, MA 02110

Amerindo Technology Growth Fund II, Inc.
c/o Amerindo Investment Advisors
399 Park Avenue, 22nd Floor
New York, NY 10022

Vertex Capital II LLC
130 West Lake Street
Wayzata, MN 55391
Attn: Matthew Fitzmaurice

Vertex Capital III LLC
130 West Lake Street
Wayzata, MN 55391
Attn: Matthew Fitzmaurice

Sands Brothers/Amerindo Technology Associates LLC
c/o Amerindo Investment Advisors
399 Park Avenue, 22nd Floor
New York, NY 10022

Sands Brothers/Technology Associates Institution LLC
c/o Amerindo Investment Advisors
399 Park Avenue, 22nd Floor
New York, NY 10022

                       EXHIBIT A - SCHEDULE OF INVESTORS
                                      A-1
<PAGE>

Name and Address

Sands Brothers/Amerindo Technology Offshore Associates LLC
c/o Amerindo Investment Advisors
399 Park Avenue, 22nd Floor
New York, NY 10022

Litton Master Trust
c/o Amerindo Investment Advisors
399 Park Avenue, 22nd Floor
New York, NY 10022

James Stableford
c/o Amerindo Investment Advisors
43 Upper Grosvenor Street
London, England W1X 9PG

Aurora Technology Fund LLC
152 West 57th Street, 57th Floor
New York, NY 10019

Beagle Limited
c/o Hecht and Company
111 West 40th Street, 20th Floor
New York, NY 10018

Global Retail Partners, L.P.
2121 Avenue of the Stars, 30th Floor
Los Angeles, CA 90067
Attention: Osamu Watanabe

  with copy to:
  Global Retail Partners, L.P.
  277 Park Avenue, 19th Floor
  New York, NY 10172
  Attention: Nicole Arnaboldi

DLJ Diversified Partners, L.P.
277 Park Avenue, 19th Floor
New York, NY 10172
Attention: Nicole Arnaboldi

  with copy to:
  DLJ Diversified Partners, L.P.
  277 Park Avenue, 23rd Floor
  New York, NY 10172
  Attention: Ivy Dodes

                       EXHIBIT A - SCHEDULE OF INVESTORS
                                      A-2
<PAGE>

Name and Address

DLJ Diversified Partners - A, L.P.
277 Park Avenue, 19th Floor
New York, NY 10172
Attention: Nicole Arnaboldi

  with copy to:
  DLJ Diversified Partners - A, L.P.
  277 Park Avenue, 23rd Floor
  New York, NY 10172
  Attention: Ivy Dodes

GRP Partners, L.P.
2121 Avenue of the Stars, 30th Floor
Los Angeles, CA  90067
Attention: Osamu Watanabe

  with copy to:
  GRP Partners, L.P.
  277 Park Avenue, 19th Floor
  New York, NY 10172
  Attention:  Nicole Arnaboldi

Global Retail Partners Funding, Inc.
277 Park Avenue, 19th Floor
New York, NY 10172
Attention: Nicole Arnaboldi

  with copy to:
  Global Retail Partners Funding, Inc.
  2121 Avenue of the Stars, 30th Floor
  Los Angeles, CA 90067
  Attention: Osamu Watanabe

DLJ ESC II L.P.
277 Park Avenue, 19th Floor
New York, NY 10172
Attention: Ed Poletti

  with copy to:
  DLJ ESC II L.P.
  277 Park Avenue, 23rd Floor
  New York, NY 10172
  Attention: Ivy Dodes

                       EXHIBIT A - SCHEDULE OF INVESTORS
                                      A-3
<PAGE>

Name and Address

Waelinvest
102 rue Waelhem
1030 Bruxelles
Belgium

  with copy to:
  525 Market Street, 23rd Floor
  San Francisco, CA 94105

Watershed Capital I, L.P.
Two Union Square
601 Union Street, Suite 4200
Seattle, WA 98101

William D. Savoy
110 - 110th Avenue NE, Suite 550
Bellevue, WA 98004-5862

Diane H. Daggatt
110 - 110th Avenue NE, Suite 550
Bellevue, WA 98004-5862

Bert Kolde
110 - 110th Avenue NE, Suite 550
Bellevue, WA 98004-5862

TWP Mercata Investors
c/o Thomas Weisel Partners
1 Montgomery Street, Suite 3700
San Francisco, CA 94104
Attention: Fredericka Drum

                       EXHIBIT A - SCHEDULE OF INVESTORS
                                      A-4

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