Document:

<PAGE>
                                                                  Exhibit 10.38

                                     7-24-00

                           VENDOR INTERFACE AGREEMENT

This VENDOR INTERFACE AGREEMENT (this "Agreement") is entered into as of by and
between Instinet UK Limited ("Instinet") and Reuters AG, ("Vendor"). (Instinet
and Vendor are sometimes referred to individually as a "Party" and collectively
as the "Parties").

                              W I T N E S S E T H:

      WHEREAS, Vendor has the software and/or system(s) developed by one of the
Reuters Group companies. The software is more fully described in Exhibit A
attached hereto and made a part hereof (the "Vendor Product(s)"); and

      WHEREAS, Instinet has created, and provided to Vendor for evaluation,
specifications using the Financial Information Exchange ("FIX") protocol for the
development or enabling of access to the Instinet System (the "Fix
Specifications": 4.0.d.9.0) for delivery by Instinet of the securities order
entry and trade reporting services described in the Fix Specifications (the
"Instinet Services") to a mutual client of Vendor and Instinet, SEB AG ("the
Customer"); and

      WHEREAS, Instinet and Vendor agree that Vendor may integrate Instinet's
proprietary OpenInstinet application, ("OpenInstinet") as more fully described
in the specification dated January 15, 2000, (the "OpenInstinet BookMark
Specification"); and

      WHEREAS, Instinet is willing to grant Vendor a limited license to use the
OpenInstinet BookMark Specification for the sole purpose of integrating
OpenInstinet into the Vendor Products and permitting the Customer to access
OpenInstinet and a limited license to use the FIX Specifications for the sole
purpose of permitting the Customer (as hereinafter defined) to access Instinet
Services through the Vendor Product(s), all subject to the terms and conditions
contained in this Agreement;

      NOW THEREFORE, in consideration of these premises, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties agree as follows:

1.    GENERAL OBLIGATIONS.

      1.1   Development, Integration and Testing. Vendor shall provide the
      ability to access the Instinet Services and OpenInstinet via the Vendor's
      Product(s) and shall test the Vendor Product(s) to ensure that such access
      operates in accordance with, and conforms to the Fix Specification and
      OpenInstinet BookMark Specification (jointly, the "Specifications").
      Vendor shall be solely responsible for any and all costs and expenses
      incurred in the development, testing and installation of the Vendor
      Product(s). The Vendor Product(s), except for OpenInstinet, are and shall
      remain the property of Vendor.
<PAGE>
      1.2   Acceptance. Upon completion of Vendor's testing pursuant to Section
      1.1 of this Agreement, Vendor shall test the Vendor Product(s) with
      Instinet (the "Acceptance Testing") until Instinet, in its sole
      discretion, has certified the Vendor Product(s) for connection to the
      Instinet System and provision of the Instinet Services and OpenInstinet
      via the Vendor Product(s) to the Customer ("Acceptance"). The Acceptance
      Testing shall be based on the Test Document for Electronic Order Entry,
      version 2.3, dated January 31, 2001. Instinet's certification of the
      Vendor Product(s) and of any future version or upgrade to the Vendor
      Product(s) shall be in writing.

      1.3   Access to Instinet System Through Vendor Product(s). Upon Acceptance
      and based on the terms and conditions contained in this Agreement, Vendor
      may provide access to the Instinet Services and OpenInstinet through the
      Vendor's Product(s) to the Customer.

      1.4   Upgrades and Alterations.

      1.4.1 Vendor. Vendor shall notify Instinet in writing as promptly as
      practicable prior to the release of any upgrade or alteration to the
      Vendor Product(s) that would affect the architecture of the Vendor
      Product(s) as it pertains to any order directed to Instinet by the
      Customer (the "Customer Orders"), the Instinet Services and/or
      OpenInstinet. In the event any upgrade or modification to the Vendor
      Product(s) causes any harm to Instinet or interferes in any way with
      Customer Orders, the Instinet System, the Instinet Services, and/or the
      OpenInstinet Book Vendor shall promptly revert to the previously certified
      version of the Vendor Product(s) at Instinet's request. Vendor shall be
      permitted to carry out testing of any upgrade or alternation to the Vendor
      Product(s) in accordance with Section 1.1 Instinet shall have the right to
      perform Acceptance Testing, in accordance with Section 1.2 herein, on all
      upgrades or modifications of the Vendor Product(s) which pertain to
      Customer Orders, the Instinet Services and/or OpenInstinet, prior to
      release of any such upgrade or modification, provided that Instinet shall
      carry out such testing promptly and with the intention of minimizing any
      interruption to the launch or operation of the Vendor Product(s).

      1.4.2 Instinet. Instinet may upgrade and/or alter the Specifications, in
      its sole discretion, from time to time during the term of this Agreement.
      Instinet shall make reasonable endeavours to consult with Vendor and
      provide all technical information reasonably requested by Vendor in
      relation to any proposed upgrade or modification to the Specifications.
      Instinet shall notify Vendor of such upgrade and/or alteration and provide
      to Vendor revised Specifications reflecting such upgrade and/or alteration
      (the "Revised Specifications") as promptly as practicable.

      1.5   Support Services and Training. Vendor shall make available a
      commercially reasonable number of personnel expertly trained to respond to
      questions from Instinet regarding the Vendor's Product(s) as pertaining to
      Customer Orders, the Instinet System, the Instinet Services and/or
      OpenInstinet during Vendor's normal business hours.

                                       2
<PAGE>
      1.6   Access Parity. Vendor shall ensure that the Vendor Product(s)
      provide the Customer with access to Instinet Services and OpenInstinet in
      a manner that is at least as favourable, both with respect to the time
      required to access the Instinet Services and the mechanics by which the
      Instinet Services and OpenInstinet are accessed, as the manner in which
      the Vendor Product(s) provide such Customer with access to the services of
      any other broker-dealer, Electronic Communication Network ("ECN") or other
      order entry or trade reporting service or destination. In the event that
      Vendor becomes aware (through notice from Instinet, the Customer or
      otherwise) that access to Instinet Services is not available to the
      Customer in accordance with the foregoing sentence, without limiting any
      remedies available under this Agreement or otherwise under law, Vendor
      shall use reasonable efforts to make the Customer's access to Instinet
      Services compliant with the foregoing sentence. For clarity, Vendor
      delivers Vendor's Product(s) without any routing preference. Vendor shall
      not be responsible for any routing preferences of the Customer required
      by, and implemented for, the Customer no matter by whom these preferences
      are implemented.

      Notwithstanding the foregoing, nothing herein shall prevent Vendor from
      entering into any strategic business alliance with any broker-dealer, ECN
      or other order entry or trade reporting service or destination where the
      specific terms and conditions of such alliance require Vendor to provide
      access to the counterparty's destination in a manner that is more
      favourable than the access Vendor provides to other destinations,
      including the Instinet Services.

      1.7   Order Handling. Vendor shall ensure that the Customer Orders shall
      be routed to Instinet in accordance with the Specifications and identified
      to Instinet as the orders of the Customer. In no event shall Vendor (i)
      redirect Customer Orders to any other ECN, order entry system or any other
      destination, (ii) conglomerate or aggregate Customer Orders with other
      Customer Orders or any other orders whatsoever, (iii) use any information
      derived from the Customer Orders for any purposes other than the
      fulfillment of its obligations under this Agreement (iv) match or
      otherwise fill Customer Orders, or (v) take any action that would
      compromise the anonymity of a Customer Order. However, Vendor shall not be
      responsible if the Customer performs any of the above actions (i.e.
      redirect, conglomerate or aggregate, match or fill or take action that
      would compromise anonymity). Vendor is not responsible for any routine
      preferences of the Customer required by, and implemented for, the
      Customer.

      1.8   Instinet Branding. Vendor shall ensure that all access to the
      Instinet Services through the Vendor Product(s) are clearly labeled as
      connecting to Instinet ("Instinet Branding"). The Instinet Branding for
      the Vendor Product(s) and/or any upgrade or modification thereto shall be
      mutually agreed by Vendor and Instinet.

                                       3
<PAGE>
2.    CUSTOMER.

      2.1   Termination. Both of Instinet and Vendor, in their independent sole
      discretion, shall have the right to terminate the Customer in accordance
      with the terms of their respective agreement with the Customer. If either
      Party terminates the Customer for breach by the Customer of its customer
      agreement with Vendor or Instinet, such termination shall be effective in
      accordance with the terms of the relevant customer agreement. The other
      Party shall be provided with notice of any such termination.

      The termination of the Customer pursuant hereto shall only affect
      Instinet's provision of Instinet Services and OpenInstinet via the Vendor
      Product(s) to the Customer. Such termination alone shall not affect any
      agreement between the Customer and Instinet or any agreement between the
      Customer and Vendor.

      2.2   Third Party Beneficiaries. In no event shall this Agreement confer
      any third party beneficiary rights upon the Customer or other clients of
      Vendor, nor shall any agreement between Instinet and the Customer confer
      any third party beneficiary rights upon Vendor.

3.    CONFIDENTIALITY.

      3.1   Provision of Confidential Matter. During the term of this Agreement,
      the Parties shall provide and/or disclose to each other certain
      information (including, without limitation, information concerning that
      Party's business, products or technical systems), which may be written or
      oral, that the Parties, their respective affiliates or their customers
      deem confidential and proprietary, whether or not such information is
      labeled as confidential or proprietary at the time it is provided or
      disclosed ("Confidential Matter"). Confidential Matter also shall include
      information relating to third party vendors or information that is
      proprietary to the disclosing Party's customers or affiliates. (The Party
      providing Confidential Matter is referred to in this Section 3 as the
      "Providing Party," and the Party receiving Confidential Matter is referred
      to in this Section 3 as the "Receiving Party").

      For purposes of this Agreement, Confidential Matter shall not include (a)
      information that was in the Receiving Party's possession, without
      restriction, prior to its disclosure to the Receiving Party by the
      Providing Party, (b) information that lawfully enters the public domain
      without violation of this Section 3 by the Receiving Party, (c)
      information that the Receiving Party lawfully receives from a third party
      without restriction and without violation of any duty of confidentiality
      owed to the Providing Party, and (d) information that is independently
      developed by the Receiving Party.

      3.2   Non-Disclosure. Except (i) as set forth in Section 3.4, and (ii) as
      may be required by law or any regulatory body or court (but only after
      compliance with Section 3.6) the Receiving Party shall maintain as
      confidential and shall not disclose Confidential Matter in whole or in
      part, directly or indirectly, to any other individual, firm, corporation
      or government authority.

                                       4
<PAGE>
      3.3   Use of Confidential Matter. Following the receipt of Confidential
      Matter, the Receiving Party shall (i) use at least the same degree of
      care, but in no event less than reasonable care, to protect such
      Confidential Matter as the Receiving Party uses with respect to its own
      confidential and proprietary information; and (ii) use such Confidential
      Matter only to fulfill its obligations under this Agreement and only in
      accordance with the terms and conditions of this Agreement.

      3.4   Representatives of the Receiving Party. Notwithstanding the
      restrictions set forth in Section 3.2, the Receiving Party may furnish the
      Confidential Matter to any of its directors, officers, employees,
      subsidiaries, agents and sub-contractors (collectively, "Representatives")
      who need to know such information for the purposes set forth in Section
      3.3; provided, however, that such Representatives are instructed to keep
      such information confidential in accordance with this Section 3. The
      Receiving Party shall be responsible for any breach of this Section 3 by
      any of its Representatives and agrees, at its sole expense, to take all
      reasonable measures (including but not limited to court proceedings) to
      restrain its Representatives from prohibited or unauthorised disclosure or
      use of any Confidential Matter.

      3.5   No Other Rights. Nothing contained in this Section 3 shall be
      construed as granting or conferring any rights by license or otherwise to
      the Receiving Party in any Providing Party's Confidential Matter.

      3.6   Required Disclosure. If a Receiving Party is requested or required
      in any judicial or administrative proceeding or by any regulatory body or
      court to disclose any Confidential Matter, such Receiving Party shall (i)
      use its best efforts to give the Providing Party prompt notice of such
      request so that it may seek an appropriate protective order or other
      remedy and (ii) consult with the Providing Party as to the advisability of
      taking legally available steps to resist or narrow such request or
      requirement. The Receiving Party shall cooperate fully with the Providing
      Party (at the Providing Party's expense) in obtaining such an order or
      other remedy. If in the absence of an appropriate protective order or
      other remedy the Receiving Party is nonetheless legally required to
      disclose Confidential Matter, the Receiving Party may make such disclosure
      without liability hereunder; provided, however, that the Receiving Party
      shall use its reasonable efforts to give the Providing Party written
      notice of the information to be disclosed as far in advance of its
      disclosure as is practicable and, upon the Providing Party's request and
      at its expense, use its reasonable efforts to obtain reasonable assurances
      that confidential treatment will be accorded to such Confidential Matter.

4.    MARKETING.

      4.1   VENDOR IS EXPRESSLY PROHIBITED FROM RELEASING THE IDENTITY OF THE
      CUSTOMER TO ANY THIRD PARTY WITHOUT FIRST OBTAINING THE WRITTEN CONSENT OF
      THE CUSTOMER AND PROVIDING A COPY THEREOF TO INSTINET.

                                       5
<PAGE>
5.    REPRESENTATIONS AND WARRANTIES.

      5.1   Vendor Representations, Warranties and Covenants. Vendor represents,
      warrants and covenants to Instinet that:

      5.1.1 the execution and delivery by Vendor of this Agreement and the
      performance of its obligations hereunder have been authorised by all
      necessary action, corporate and otherwise, and that this Agreement
      constitutes a legal, valid and binding obligation of Vendor enforceable in
      accordance with its terms, except to the extent that such enforceability
      is subject to or limited by bankruptcy, insolvency or similar laws
      relating to the enforcement of creditor's rights;

      5.1.2 the execution and delivery by Vendor of this Agreement and the
      performance of its obligations hereunder does not breach any law, rules or
      regulations to which Vendor is subject or any agreement, obligation or
      restriction by which Vendor is bound, and Vendor will not enter into or
      assume any agreement, obligation or restriction that will interfere with
      any of its obligations hereunder or the rights granted herein.

      5.2   Instinet Representations, Warranties and Covenants. Instinet
      represents, warrants and covenants to Vendor that:

      5.2.1. the execution and delivery by Instinet of this Agreement and the
      performance of its obligations hereunder have been authorised by all
      necessary action, corporate and otherwise, and this Agreement constitutes
      a legal, valid and binding obligation of Instinet enforceable in
      accordance with its terms, except to the extent that such enforceability
      is subject to or limited by bankruptcy, insolvency or similar laws
      relating to the enforcement of creditor's rights;

      5.2.2 the execution and delivery by Instinet of this Agreement and the
      performance of its obligations hereunder does not breach any law, rules or
      regulations to which Instinet is subject or any agreement, obligation or
      restriction by which Instinet is bound and Instinet will not enter into or
      assume any agreement, obligation or restriction that will interfere with
      any of its obligations hereunder or the rights granted herein; and

      5.2.3 Instinet has the right and authority to grant the license to the
      Specifications.

6.    DISCLAIMER OF WARRANTIES AND LIMITATION OF LIABILITY. EXCEPT AS SET FORTH
      IN SECTION 5.1 OF THIS AGREEMENT WITH RESPECT TO VENDOR, AND SECTION 5.2
      OF THIS AGREEMENT WITH RESPECT TO INSTINET, (I) THE VENDOR PRODUCT(S),
      WITH RESPECT TO VENDOR, AND (II) THE SPECIFICATIONS AND INSTINET SERVICES,
      WITH RESPECT TO INSTINET, ARE PROVIDED "AS IS" WITHOUT WARRANTY OF ANY
      KIND BY VENDOR OR INSTINET, RESPECTIVELY, INCLUDING BUT NOT LIMITED TO ANY
      IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A

                                       6
<PAGE>
      PARTICULAR PURPOSE. EXCEPT WITH RESPECT TO THE INDEMNIFICATION OBLIGATIONS
      CONTAINED IN SECTION 7 OF THIS AGREEMENT OR ANY INTENTIONAL MATERIAL
      BREACH OF THE CONFIDENTIALITY OBLIGATIONS CONTAINED IN SECTION 3 OF THIS
      AGREEMENT, NEITHER PARTY SHALL BE LIABLE TO THE OTHER OR ANY THIRD PARTY
      CLAIMING THROUGH THE OTHER, FOR ANY SPECIAL, INCIDENTAL, OR CONSEQUENTIAL
      DAMAGES ARISING OUT OF THE FURNISHING, PERFORMANCE, OR USE OF, OR
      INABILITY TO USE, THE SPECIFICATIONS, THE VENDOR PRODUCTS(S) OR THE
      INSTINET SERVICES PROVIDED UNDER THIS AGREEMENT.

7.    INDEMNIFICATION

      7.1   Vendor Indemnification of Instinet. Subject to the limitations set
      forth in this Section 7.1, Vendor, at its own expense, shall: (i)
      indemnify, defend and hold Instinet and/or any of its affiliates and its
      or their respective officers, directors, partners, employees, agents or
      representatives (collectively, the "Instinet Indemnitees"), harmless from
      and against (or at its option, but with Instinet's prior agreement,
      settle) any claim, action, suit or proceeding against Instinet or any of
      its affiliates and any of their respective officers, directors, partners,
      employees, agents and representatives on the basis of (A) any alleged
      infringement in whole or in part, of any third party's patent, copyright,
      trade secret or other intellectual property rights by the Vendor
      Product(s), and (B) any breach by Vendor of the obligations in Sections
      1.6, 1.7, 1.8, or the representations, warranties or covenants set forth
      in Section 5.1 of this Agreement; (ii) pay any final judgment entered or
      settlement against Instinet and indemnify and defend and hold Instinet
      harmless from and against all damages, liabilities, costs and expenses
      incurred by Instinet arising out of or in connection with any such claim,
      action, suit or proceeding. Vendor shall have no obligation to any of the
      Instinet Indemnitees pursuant to this Section 7.1 unless: (A) Instinet
      provides Vendor prompt written notice of the claim, action, suit or
      proceeding after Instinet's discovery thereof; (B) Vendor is given the
      right to control and direct the investigation, preparation, defense and
      settlement of the claim, action, suit or proceeding; provided, however,
      that Instinet shall retain the right to file an answer or take any other
      action necessary to prevent the entry of a default judgment or injunction
      against it and the right to consult with Vendor regarding the litigation
      or settlement; and (C) Instinet gives Vendor reasonable assistance and
      information at Instinet's expense in connection with such claim, action,
      suit or proceeding.

      7.2   Instinet Indemnification of Vendor. Subject to the limitations set
      forth in this Section 7.2, Instinet, at its own expense, shall: (i)
      indemnify, defend and hold Vendor and/or any of its affiliates and its or
      their respective officers, directors, partners, employees, agents or
      representatives (collectively, the "Vendor Indemnitees"), harmless from
      and against (or at its option, but with Vendor's prior agreement, settle)
      any claim, action, suit or proceeding against Vendor or any of its
      affiliates and any of their respective officers, directors, partners,
      employees, agents and representatives on the basis of (A) any alleged
      infringement in whole or in part, of any third party's intellectual
      property rights by the Specifications (unless such Specifications are
      jointly developed by

                                       7
<PAGE>
      Instinet and Vendor) (B) the Instinet Services (unless such Instinet
      Services are modified or altered by Vendor); and (C) any breach by
      Instinet of the representations, warranties or covenants set forth in
      Section 5.2 of this Agreement; and (ii) pay any final judgment entered or
      settlement against Vendor and indemnify and defend and hold Vendor
      harmless from and against all damages, liabilities, costs and expenses
      incurred by Vendor arising out of or in connection with any such claim,
      action, suit or proceeding. Instinet shall have no obligation to any of
      the Vendor Indemnitees pursuant to this Section 7.2 unless: (A) Vendor
      provides Instinet prompt written notice of the claim, action, suit or
      proceeding after Vendor's discovery thereof; (B) Instinet is given the
      right to control and direct the investigation, preparation, defense and
      settlement of the claim, action, suit or proceeding; provided, however,
      that Vendor shall retain the right to file an answer or take any other
      action necessary to prevent the entry of a default judgment or injunction
      against it and the right to consult with Instinet regarding the litigation
      or settlement; and (C) Vendor gives Instinet reasonable assistance and
      information at Vendor's expense in connection with such claim, action,
      suit or proceeding.

8.    TERM, TERMINATION, EFFECT OF TERMINATION AND SURVIVAL.

      8.1   Term. This Agreement shall be effective as of the date first written
      above and shall remain in effect until terminated by either Party pursuant
      to this Section 8.

      8.2   Termination.

      8.2.1 Termination for breach. Either Party may terminate this Agreement ,
      by giving written notice to the other Party in the event that the other
      Party commits a material breach of its obligations under this Agreement
      which (if capable of remedy) is not remedied within 30 days of receipt of
      a notice requesting that the breach be remedied,

      8.2.2 Termination for insolvency. Either Party may terminate this
      Agreement immediately and without notice if the other Party makes an
      assignment for the benefit of its creditors, files or has filed against it
      a petition under any bankruptcy, insolvency, reorganization or similar
      law, has a trustee or receiver appointed over any of its property or
      commences (by resolution or otherwise) the liquidation or winding-up of
      its affairs.

      8.3   Effect of Termination and Survival.

      8.3.1 Instinet and Vendor. Upon termination of this Agreement pursuant to
      this Section 8, the Parties shall promptly return to the other Party any
      tangible Confidential Matter in its possession, purge all Confidential
      Matter from its electronic records, and immediately cease all marketing
      efforts, including any use of the other Party's name, trademark, service
      mark or logo.

      8.3.2 Survival. Sections 3, 4.2, 6, 7, 8.3.2, and 9.6 of this Agreement
      shall survive any termination of this Agreement for any reason.

                                       8
<PAGE>
9.    MISCELLANEOUS.

      9.1   Equitable Relief. The Parties agree that the remedy at law for any
      breach by either Party of the terms of Sections 3 and 4 and 1.7 hereof
      will be inadequate and that, accordingly, in addition to any remedies
      either Party may have at law, both Parties will be entitled to apply for
      and obtain equitable relief in any court of competent jurisdiction to
      restrain the breach or threatened breach of, or otherwise to specifically
      enforce such terms.

      9.2   Notices. All notices which are required to be given pursuant to this
      Agreement shall be in writing and shall be hand delivered, sent by
      overnight courier (such as Federal Express), or sent by facsimile
      transmission, with a confirming copy sent by first class mail, postpaid,
      or sent by registered or certified mail, return receipt requested, to the
      following address or to such other address as a Party may from time to
      time designate by notice. Such notices shall be deemed given upon receipt
      if hand delivered, on the next business day if sent by overnight courier,
      upon receipt of a confirmation of transmission if sent via facsimile or
      three (3) business days after mailing if sent via registered or certified
      mail:

      If to Instinet:                     Commodity Quay,
                                          East Smithfield
                                          London E1W 1AZ
                        Attention:        Ruth Liggett

                        With a copy to:   Address as above
                        Attention:        European General Counsel

      If to Vendor:     Alexander Tuis
                        Reuters Consulting
                        Messeturm
                        Friedrich-Ebert-Anlage 49
                        D-60327 Frankfurt am Main
                        Germany/Deutschland

                        With a copy to:
                        Carsten Scherhag
                        Address as above

      9.3   Entire Agreement and Amendment. This Agreement, including the
      Exhibits, if any, contains the entire agreement between the parties with
      respect to the subject matter hereof and supersedes all other prior or
      contemporaneous oral or written communications, proposals, agreements and
      representations with respect to the subject

                                       9
<PAGE>
      matter. No amendment or modification to this Agreement shall be binding,
      unless it is in writing and executed by each Party.

      9.4   Assignment. This Agreement and the rights granted and obligations
      undertaken hereunder may not be transferred, assigned or delegated, by
      operation of law or otherwise, by either Party without the consent of the
      other Party (which consent shall not be unreasonably withheld or delayed),
      provided that each Party may assign or transfer this Agreement to any
      other member of its respective group without consent.

      9.5   Waiver of Compliance and Severability. Any waiver of any provision
      of this Agreement, or any delay by either party in the enforcement of any
      right hereunder, shall neither be construed as a continuing waiver nor
      create an expectation of non-enforcement of that or any other provision or
      right. In the event any one or more of the provisions of this Agreement
      shall for any reason be held to be invalid, illegal or unenforceable, the
      remaining provisions of this Agreement shall be unimpaired, and the
      Parties shall negotiate in good faith to substitute a provision of like
      economic intent and effect.

      9.6   Governing Law and Choice of Forum. This Agreement is made under and
      shall be governed by and construed in accordance with the laws of England
      and Wales. Both parties consent to the jurisdiction of the courts of
      England and Wales, and agree to institute any and all actions relating to
      this Agreement in such courts.

      9.7   Interpretation. The section headings contained in this Agreement are
      solely for the purpose of reference, are not part of the agreement between
      the parties and shall not in any way affect the meaning or interpretation
      of this Agreement.

      9.8   Counterparts. This Agreement may be executed in one or more
      counterparts, each of which shall be deemed an original, and both of which
      together shall constitute one and the same instrument.

      IN WITNESS WHEREOF, the authorised officers of the parties hereto have
      executed this Vendor Interface Agreement as of the date first written
      above.

REUTERS AG, Frankfurt am Main             Instinet UK LIMITED

By:                                       By:
   ---------------------------               ------------------------------
Name:                                        Name:
Title:                                       Title:

                                       10
<PAGE>
EXHIBIT A

DESCRIPTION OF VENDOR PRODUCT(S)

Effix FIX-Gateway, version V2.4.1.L5 and the SEB Commission Trader Foreign
Font-end GUI.

                                       11<PAGE>
                                                                   Exhibit 10.39

                          REGISTRATION RIGHTS AGREEMENT

                                      among

                           INSTINET GROUP INCORPORATED

                                       and

                                DAVID G. JAMAIL,

                                 DAVID R. BURCH,

                                 OVERUNDER, LLC,

                              JOHN A. MCENTIRE, IV,

                                   JOHN BUNDA,

                                  LAURA HORNE,

                                 CURRIN VAN EMAN

                                       And

                                  SHAYNE YOUNG

                           Dated as of October 1, 2001
<PAGE>
                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                            PAGE
<S>       <C>                                                               <C>
                                  ARTICLE I

                                 DEFINITIONS

    1.1   Defined Terms...................................................    1
    1.2   Interpretation..................................................    5
                                 ARTICLE II

                             REGISTRATION RIGHTS

    2.1   Restrictions on Sale............................................    6
    2.2   Demand Registrations............................................    8
    2.3   Piggyback Registrations.........................................   11
    2.4   Registration Procedures.........................................   13
    2.5   Underwritten Offerings..........................................   16
    2.6   Registration Expenses...........................................   17
    2.7   Indemnification.................................................   17
    2.8   Rule 144........................................................   20
                                 ARTICLE III

                                MISCELLANEOUS

    3.1   Term............................................................   20
    3.2   Injunctive Relief...............................................   20
    3.3   Notices.........................................................   20
    3.4   Successors, Assigns and Transferees.............................   21
    3.5   Governing Law; Submission to Jurisdiction; Appointment of
          Agent for Service of Process....................................   22
    3.6   Headings........................................................   22
    3.7   Severability....................................................   22
    3.8   Amendment; Waiver...............................................   22
    3.9   Counterparts....................................................   23
    3.10  Other Registration Rights.......................................   23
</TABLE>

                                       i
<PAGE>
                          REGISTRATION RIGHTS AGREEMENT

            REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of
October 1, 2001 by and among Instinet Group Incorporated, a Delaware corporation
(the "Issuer") and Overunder, LLC, a Delaware limited liability company
("Overunder"), David G. Jamail, an individual residing in Austin, Texas
("Jamail"), David R. Burch, an individual residing in Austin, Texas ("Burch"),
John A. McEntire, an individual residing in Austin, Texas ("McEntire"), John
Bunda, an individual residing in Austin, Texas ("Bunda"), Laura Horne, an
individual residing in Austin, Texas ("Horne"), Currin Van Eman, an individual
residing in Austin, Texas ("Van Eman") and Shayne Young, an individual residing
in Austin, Texas ("Young") (each a "Seller" and collectively, the "Sellers")
(each Seller and Issuer a "Party" and, collectively, the "Parties").

                                    RECITALS

            A.    WHEREAS, the Issuer, the Sellers and certain other parties
have entered into an Interest Purchase Agreement dated as of July 23, 2001, as
amended as of October 1, 2001 (the "Interest Purchase Agreement") pursuant to
which the Sellers will receive, among other consideration, common stock, par
value $0.01 per share (the "Instinet Common Stock") of the Issuer, in the
amounts set forth in Exhibit A (the "Initial Instinet Stock");

            B.    WHEREAS, the Parties acknowledge that Issuer has previously
entered into an agreement (the "Reuters Agreement") with Reuters Limited, a
company organized under the laws of England and Wales, in which Issuer has
agreed to provide registration rights to Reuters Limited and certain of its
Affiliates and transferees (the "Reuters Entities"); and

            C.    WHEREAS, as an inducement to the Sellers to enter into the
Interest Purchase Agreement, the Issuer has agreed to provide the registration
rights set forth in this Agreement and as an inducement to the Issuer to enter
into the Interest Purchase Agreement, the Sellers have agreed to the transfer
restrictions set forth in this Agreement.

                                    AGREEMENT

            NOW, THEREFORE, in consideration of the foregoing and the mutual
promises, covenants and agreements of the parties hereto, and for other good and
valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the Parties agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

            1.1   Defined Terms. As used in this Agreement, the following terms
shall have the following meanings:

            "Adverse Disclosure" means public disclosure of material non-public
information, which disclosure in the good faith judgment of the chief executive
officer or chief financial officer of the Issuer after consultation with counsel
to the Issuer (i) would be required to be made in any Registration Statement so
that such Registration Statement would not be
<PAGE>
materially misleading, (ii) would not be required to be made at such time but
for the filing of such Registration Statement and (iii) the Issuer has a bona
fide business purpose for not disclosing publicly.

            "Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlled by, controlling or under common control with,
such Person. For purposes of this definition, "control" means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of an entity, whether through the ownership of
securities, by contract or otherwise.

            "Agreement" means this Registration Rights Agreement.

            "Bunda" shall have the meaning set forth in the preamble.

            "Burch" shall have the meaning set forth in the preamble.

            "Business Day" means any day other than Saturday, Sunday or any day
on which banking institutions are authorized or obligated by law or executive
order to be closed in New York.

            "Closing Date" shall have the meaning set forth in the Interest
Purchase Agreement.

            "Demand Notice" shall have the meaning set forth in Section 2.2(a).

            "Demand Period" shall have the meaning set forth in Section 2.2(d).

            "Demand Purchase Date" shall have the meaning set forth in Section
2.1(c).

            "Demand Registration" shall have the meaning set forth in Section
2.2(a).

            "Demand Registration Statement" shall have the meaning set forth in
Section 2.2(a).

            "Exchange Act" means the Securities Exchange Act of 1934, as
amended, and any successor thereto, and any rules and regulations promulgated
thereunder, all as the same shall be in effect from time to time.

            "Holder" or "Holders" means (i) as of the Closing Date, any Seller
or Sellers other than McEntire, and (ii) as of the Second Closing Date, any
Seller or Sellers, in each case together with any of their respective permitted
assignees or transferees to whom any Holder may Transfer registration rights in
accordance with Section 3.4.

            "Horne" shall have the meaning set forth in the preamble.

            "Initial Instinet Stock" shall have the meaning set forth in the
recitals.

            "Instinet Common Stock" shall have the meaning set forth in the
recitals.

                                        2
<PAGE>
            "Instinet Daily Price" shall have the meaning set forth in the
Interest Purchase Agreement.

            "Instinet IPO" means the initial public offering of the Issuer
consummated on May 23, 2001.

            "Interest Purchase Agreement" shall have the meaning set forth in
the recitals.

            "IPO Lock-up Period" shall have the meaning set forth in Section
2.1(a).

            "Issuer" shall have the meaning set forth in the preamble and shall
include the Issuer's successors by merger, acquisition, reorganization or
otherwise.

            "Jamail" shall have the meaning set forth in the preamble.

            "Loss" or "Losses" shall have the meaning set forth in Section
2.7(a).

            "McEntire" shall have the meaning set forth in the preamble.

            "NASD" means the National Association of Securities Dealers, Inc.

            "Offered Shares" shall have the meaning set forth in Section 2.1(c).

            "Other Holders" shall have the meaning set forth in Section 2.3(b).

            "Overunder" shall have the meaning set forth in the preamble.

            "Party" and "Parties" shall have the meanings set forth in the
preamble.

            "Permitted Transferee" means any transferee of Initial Common Stock
pursuant to a Permitted Transfer.

            "Person" means any individual, firm, limited liability company or
partnership, joint venture, corporation, joint stock company, trust or
unincorporated organization, incorporated or unincorporated association,
government (or any department, agency or political subdivision thereof) or other
entity of any kind.

            "Permitted Transfers" means:

            (a)   any transfer of Initial Instinet Stock from one Party to
another Party;

            (b)   a transfer to a nominee or fiduciary holding for the sole
benefit of a Party and the transfer by such a nominee or fiduciary to such
Party;

            (c)   in the case of an individual Seller, a transfer to a parent,
spouse or child of such Seller or to a trust the sole beneficiaries of which
consists of the parents, the spouse or the children of such Seller; or

            (d)   a transfer to an Affiliate of a Party.

                                       3
<PAGE>
            "Piggyback Notice" shall have the meaning set forth in Section
2.3(a).

            "Piggyback Purchase Date" shall have the meaning set forth in
Section 2.1(c).

            "Piggyback Registration" shall have the meaning set forth in Section
2.3(a).

            "Prospectus" means the prospectus included in any Registration
Statement, all amendments and supplements to such prospectus and all material
incorporated by reference in such prospectus.

            "Registrable Securities" means any shares of the Initial Instinet
Stock owned by Holders and any stock or other securities into which or for which
such Initial Instinet Stock may hereafter be changed, converted or exchanged and
any other shares or securities issued to Holders in respect of such Initial
Instinet Stock (or such shares or other securities into which or for which such
shares are so changed, converted or exchanged) upon any reclassification, share
combination, share subdivision, share dividend, share exchange, merger,
consolidation or similar transaction or event; provided, however, that shares of
Initial Instinet Stock placed in escrow in accordance with the Interest Purchase
Agreement shall not be Registrable Securities for so long as they are in escrow
unless the Sellers are permitted by the Interest Purchase Agreement to replace
such Initial Instinet Stock with cash and in the relevant Registration Notice
undertake to do so during the effectiveness of the applicable Registration
Statement; and provided, further, that any securities that are Registrable
Securities shall cease to be "Registrable Securities" to the extent (i) a
Registration Statement with respect to their sale has been declared effective
under the Securities Act and they have been disposed of pursuant to such
Registration Statement, (ii) they have been distributed pursuant to Rule 144 (or
any similar provision then in force) under the Securities Act or (iii) they have
become eligible to be sold pursuant to Rule 144(k) under the Securities Act.

            "Registration" means a registration of the Issuer's securities for
sale to the public under a Registration Statement.

            "Registration Effective Date" shall have the meaning set forth in
Section 2.1(c).

            "Registration Notice" shall have the meaning set forth in Section
2.1(c).

            "Registration Statement" means any registration statement of the
Issuer filed with, or to be filed with, the SEC under the rules and regulations
promulgated under the Securities Act, including the Prospectus, amendments and
supplements to such registration statement, including post-effective amendments,
and all exhibits and all material incorporated by reference in such registration
statement.

            "SEC" means the Securities and Exchange Commission.

            "Second Closing Date" shall have the meaning set forth in the
Interest Purchase Agreement.

                                       4
<PAGE>
            "Securities Act" means the Securities Act of 1933, as amended, and
any successor thereto, and any rules and regulations promulgated thereunder, all
as the same shall be in effect from time to time.

            "Seller" shall have the meaning set forth in the preamble.

            "Trading Allowance" shall have the meaning set forth in Section
2.1(b).

            "Transfer" shall have the meaning set forth in Section 2.1(a).

            "Underwritten Offering" means a registration in which securities of
the Issuer are sold to an underwriter or underwriters on a firm commitment basis
for reoffering to the public.

            "Van Eman" shall have the meaning set forth in the preamble.

            "Young" shall have the meaning set forth in the preamble.

            1.2   Interpretation. In this Agreement:

            (a) the Table of Contents and headings are for convenience only and
shall not affect the interpretation of this Agreement;

            (b) unless otherwise specified, references to Articles, Sections,
clauses, Schedules and Exhibits are references to Articles, Sections and clauses
of, and Schedules and Exhibits to, this Agreement;

            (c) references to any document or agreement, including this
Agreement, shall be deemed to include references to such document or agreement
as amended, supplemented or replaced from time to time in accordance with its
terms and (where applicable) subject to compliance with the requirements set
forth therein;

            (d) references to any party to this Agreement or any other document
or agreement shall include its successors and permitted assigns;

            (e) whenever in this Agreement, a contract or instrument is referred
to as "enforceable," such statement shall be deemed to be limited by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other similar
laws relating to the enforcement of creditors' rights generally and by general
principles of equity;

            (f) the words "include", "includes" and "including" are not limiting
and are deemed to be followed by the words "without limitation;"

            (g) neutral pronouns and variations thereof shall be deemed to
include the feminine and masculine and neuter form;

            (h) all terms used in the singular shall be deemed to include the
plural and vice versa as the context may require; and

                                       5
<PAGE>
            (i) unless the context requires otherwise, derivative forms of any
capitalized term defined herein shall have a comparable meaning to that of such
term.

                                   ARTICLE II

                               REGISTRATION RIGHTS

            2.1   Restrictions on Sale.

            (a) For a period of 180 days after the Instinet IPO (the "IPO
Lock-up Period"), each Holder agrees not to (i) offer, sell, contract to sell,
pledge or otherwise dispose of, directly or indirectly ("Transfer"), or file
with the SEC, a registration statement under the Securities Act relating to, any
shares of Initial Instinet Stock or securities convertible into or exchangeable
or exercisable for Instinet Common Stock or (ii) publicly disclose the intention
to make any such offer, sale, pledge, disposition or filing, in each case
without the prior written consent of the Issuer.

            (b) For a period commencing at the expiration of the IPO Lock-up
Period and ending 2 years from the Closing Date, each Holder agrees not to
Transfer any shares of Initial Instinet Stock except (x) Permitted Transfers
(provided that the permitted transferee agrees in writing to be bound by the
terms of this Agreement), (y) as otherwise permitted in this Section 2.1(b) or
(z) with Issuer's prior written consent.

                  (i)   Subject to the provisions of Section 2.1(c), for a
period commencing at the expiration of the IPO Lock-up Period and ending 2 years
after the Closing Date, each Holder may Transfer any Registrable Securities
owned by such Holder pursuant to an effective Registration Statement.

                  (ii)  In addition to transfers permitted by Section 2.1(b)(i),
after the date that is the first anniversary of the Closing Date, each Seller
may Transfer up to 37,500 shares of Initial Instinet Stock in any week; provided
that such Transfers are made in accordance with Rule 144 of the Securities Act
or otherwise to the extent exemption from registration under the Securities Act
is available. Shares of such Seller's Initial Instinet Stock that may be
transferred pursuant to this Section 2.1(b)(ii) shall be the "Trading
Allowance." Anything herein to the contrary notwithstanding, the Trading
Allowance limitations set forth above shall not apply to transactions permitted
under the definition of "Permitted Transfer."

            (c) Issuer Right of First Refusal. (i) On or before the second
anniversary of the Closing Date and upon receipt of a Demand Notice or Piggyback
Notice (each a "Registration Notice") indicating any Holder's intent to sell
part or all of such Holder's Initial Instinet Stock (the "Offered Shares")
pursuant to an effective Registration Statement as provided for in Section 2.2
or 2.3 of this Agreement, Issuer shall have the exclusive right and option to
purchase such Holder's Offered Shares, exercisable by notifying such Holder at
any time during a period of 5 Business Days from Issuer's receipt of the
applicable Registration Notice.

                  (ii)  If, after receipt of a Demand Notice, Issuer elects to
purchase all of such Holder's Offered Shares, such Holder shall sell, and Issuer
shall purchase, all of such Offered Shares on a day that is no later than 3
Business Days following the date of Issuer's

                                       6
<PAGE>
election (the "Demand Purchase Date"). On the Demand Purchase Date, Issuer shall
deliver payment, in immediately available funds, equal to (x) the price per
share equal to the volume weighted average (rounded to the nearest 1/1,000) of
the Instinet Daily Price for the 7 Nasdaq trading days prior to the date of such
Demand Notice multiplied by (y) the number of Offered Shares being purchased.

                  (iii) If, after receipt of a Piggyback Notice related to an
Underwritten Offering, Issuer elects to purchase all of such Holder's Offered
Shares, such Holder shall sell, and Issuer shall purchase, all of such Offered
Shares on the date of the completion of the distribution of shares under such
Underwritten Offering (the "Piggyback Purchase Date"). On the Piggyback Purchase
Date, Issuer shall deliver payment, in immediately available funds, equal to (x)
the price per share equal to the offering price per share under the Underwritten
Offering multiplied by (y) the number of Offered Shares being purchased.
Issuer's obligation to purchase the Offered Shares under this paragraph
2.1(c)(iii) is subject to the completion of the distribution of shares under the
applicable Underwritten Offering.

                  (iv)  If, after receipt of a Piggyback Notice related to an
offering that is not an Underwritten Offering, Issuer elects to purchase all of
such Holder's Offered Shares, such Holder shall sell, and Issuer shall purchase,
all of such Offered Shares on a day that is no later than 3 Business Days
following the date (the "Registration Effective Date") on which the Registration
Statement is declared effective. On such date, Issuer shall deliver payment, in
immediately available funds, equal to (x) the price per share equal to the
volume weighted average (rounded to the nearest 1/1,000) of the Instinet Daily
Price for the 7 Nasdaq trading days prior to the Registration Effective Date
multiplied by (y) the number of Offered Shares being purchased.

            (d) Black-out Periods for Holders. In the event of a Registration by
the Issuer, the Holders of Registrable Securities agree, if requested by the
Issuer (or, in the case of an Underwritten Offering, by the managing underwriter
or underwriters) not to effect any public sale or distribution (including any
sale pursuant to Rule 144 under the Securities Act) of any securities (except,
in each case, as part of the applicable Registration, if permitted) which are
the same as or similar to those being registered in connection with such
Registration, or which are convertible into or exchangeable or exercisable for
such securities, during the period beginning 7 days before, and ending 90 days
(or such lesser period as may be permitted by the Issuer or such managing
underwriter or underwriters) after, the effective date of the Registration
Statement filed in connection with such registration (or the commencement of the
offering to the public of Issuer securities in the case of Rule 415 offerings),
to the extent such Holders are timely notified in writing by the Issuer or the
managing underwriter or underwriters.

            (e) Black-out Period for the Issuer and Others. In the case of a
Registration of Registrable Securities pursuant to Section 2.2, the Issuer
agrees, if requested by the Holders of a majority of the Registrable Securities
to be sold pursuant to the such Registration (or, in the case of an Underwritten
Offering, by the managing underwriter or underwriters in such Underwritten
Offering), not to effect any public sale or distribution of any securities
(except, in each case, as part of the applicable Registration, if permitted)
which are the same as or similar to those being registered, or which are
convertible into or exchangeable or exercisable for such securities, during the
period beginning 7 days before, and ending 90 days (or such lesser period as may
be

                                       7
<PAGE>
permitted by such holders or such underwriter or underwriters) after, the
effective date of the Registration Statement filed in connection with such
Registration, to the extent the Issuer is timely notified in writing by the
Holders of a majority of Registrable Securities covered by such Registration
Statement or the managing underwriter or underwriters. Notwithstanding the
foregoing, the Issuer may effect a public sale or distribution of securities of
the type described above and during the periods described above if the same (A)
is made pursuant to a registration on Form S-4 or S-8 or any successor form to
such forms, (B) as part of any registration of securities for offering and sale
to employees or directors of the Issuer pursuant to any employee stock plan or
other employee benefit plan arrangement or (C) as part of a registration of
securities issued solely in an acquisition or business combination.

            2.2   Demand Registrations.

            (a) Demand by Holders. (i) At any time and from time to time, a
Holder or Holders may make a written request to the Issuer (a "Demand Notice")
to use commercially reasonable efforts to register (a "Demand Registration") all
or part of the Registrable Securities held by it; provided, however, that (A)
the Issuer shall not be required to make a Demand Registration if the estimated
market value of the Registrable Securities to be so registered is less than $10
million in the aggregate and (B) the Issuer shall not be required to file a
Demand Registration Statement prior to November 23, 2001. Each request for a
Demand Registration shall specify the aggregate amount of Registrable Securities
to be registered and the intended methods of disposition thereof.

                  (ii)  Promptly following receipt of any Demand Notice, the
Issuer shall deliver written notice of such request to all other Holders of
Registrable Securities. Thereafter, the Issuer shall include in such Demand
Registration any additional Registrable Securities which the Holder or Holders
thereof have requested in writing be included in such Demand Registration;
provided that all requests therefor have been received by the Issuer within
fifteen (15) Business Days of the Issuer's having sent the applicable notice to
such Holder or Holders. All such requests shall specify the aggregate amount of
Registrable Securities to be registered and the intended method of distribution
of the same and all such Holders shall be deemed to have jointly issued the
Demand Notice.

                  (iii) Subject to Section 2.2(a)(i)(B), as promptly as
practicable following receipt of a request for a Demand Registration, the Issuer
shall file a Registration Statement relating to such Demand Registration (the
"Demand Registration Statement") and shall use its reasonable best efforts to
cause such Registration Statement promptly to be declared effective under the
Securities Act and the securities or "Blue Sky" laws of each state and other
jurisdiction of the United States as any Holder of Registrable Securities being
registered under such Registration or any underwriter, if any, reasonably
requests in a manner consistent with Issuer's obligations under Section
2.4(a)(ix) of this Agreement.

            (b) Limitation on Demand Registrations. In no event shall Issuer be
required to effect more than two Demand Registrations.

            (c) Demand Withdrawal. In the event that a Demand Registration is
requested under this Section and a Holder later determines not to sell its
Registrable Securities in

                                       8
<PAGE>
connection with the Registration requested, then prompt notice shall be given by
such Holder to the Issuer that the Registration requested with respect to such
Holder is no longer required and that the request is thereby withdrawn. Upon
receipt of such notice, the Issuer shall cease all efforts to secure
Registration with respect to such Holder and shall take all action necessary and
reasonably practicable to prevent the commencement of effectiveness for any
Registration Statement with respect to such Holder that it is preparing or has
prepared in connection with the withdrawn request. Such Registration shall be
deemed a Demand Registration for purposes of Section 2.2(b) above, unless all
participating Holders have withdrawn and (i) the withdrawing Holders shall have
paid or reimbursed the Issuer for all of the reasonable out-of-pocket fees and
expenses incurred by the Issuer in connection with the Registration of such
withdrawn Registrable Securities or (ii) the withdrawal was caused by a breach
by the Issuer of this Agreement.

            (d) Effective Registration. The Issuer shall be deemed to have
effected a Demand Registration if the Demand Registration Statement is declared
effective by the SEC and remains effective for a period (the "Demand Period")
not less than 90 days (or such shorter period as will terminate when all
Registrable Securities covered by such Demand Registration Statement have been
sold or withdrawn) or such longer period as in the opinion of counsel for the
underwriter or underwriters a Prospectus is required by law to be delivered in
connection with sales of Registrable Securities by an underwriter or dealer. No
Demand Registration shall be deemed to have been effected if (i) during the
Demand Period such registration is terminated by any stop order, injunction or
other order or requirement of the SEC or other governmental agency or court or
(ii) the conditions to closing specified in the underwriting agreement, if any,
entered into in connection with such Registration are not satisfied by reason of
a wrongful act, misrepresentation or breach of an applicable underwriting
agreement or this Agreement by the Issuer.

            (e) Suspension of Registration. If the filing, initial effectiveness
or continued use of a Demand Registration Statement at any time would require
the Issuer to make an Adverse Disclosure or would require the inclusion in such
Demand Registration Statement of financial statements that are unavailable to
the Issuer for reasons beyond the Issuer's control, the Issuer may, upon giving
prompt written notice of such action to the Holders, delay the filing or initial
effectiveness of, or suspend use of, such Demand Registration Statement for the
shortest possible period of time determined in good faith by the Issuer to be
necessary for such purpose. In the event the Issuer exercises its rights under
the preceding sentence, the Holders agree to suspend, immediately upon their
receipt of the notice referred to above, their use of the Prospectus relating to
the Demand Registration in connection with any sale or offer to sell Registrable
Securities and agree not to disclose to any other Person the fact that the
Issuer has exercised such rights or any related facts. The Issuer shall
immediately notify the Holders of the expiration of any period during which it
exercised its rights under this Section 2.2(e). If a Holder is required to
suspend the use of a Prospectus pursuant to this Section 2.2(e), the applicable
Demand Period shall be extended by the same number of days as the days such use
is suspended.

            (f) Underwritten Offering. If the Holders of not less than a
majority of the Registrable Securities requesting a Demand Registration so
elect, such offering shall be in the form of an Underwritten Offering. In the
event of an Underwritten Offering, the Issuer shall select an internationally
recognized investment bank as underwriter, and such selection shall be

                                       9
<PAGE>
subject to the written consent of the Holders of not less than a majority of the
Registrable Securities to be included in such offering, which consent may not be
unreasonably withheld.

            (g) Priority of Securities Registered Pursuant to Demand
Registrations. If the managing underwriter or underwriters of a proposed
Underwritten Offering of a class of Registrable Securities included in a Demand
Registration (or, in the case of a Demand Registration not being underwritten,
the Issuer) informs the Holders of such Registrable Securities in writing that,
in its or their opinion, the number of securities of such class requested to be
included in such Demand Registration (including securities of the Issuer for its
own account or for the account of other Persons which are not Holders of
Registrable Securities) exceeds the number which can be sold in such offering
without being likely to have a significant adverse effect on the price, timing
or distribution of the offering and sale of the Registrable Securities then
contemplated by any Holder or in the market for Instinet Common Stock, the
Issuer shall include in such registration:

                  (i)   first, (A) Registrable Securities sought to be included
therein by the Holders pursuant to the exercise of their demand registration
rights and (B) securities sought to be included in such Registration by any of
the Reuters Entities. If such number is less than the full number of such
Registrable Securities and securities of such Reuters Entities sought to be
included, such number shall be allocated 66.67% among the Holders and 33.33%
among the Reuters Entities (provided that (x) if such number of securities
allocated to the Holders is less than the full number of Registrable Securities
requested to be included, such number shall be allocated pro rata among Holders
of Registrable Securities on the basis of the number of Registrable Securities
then held by each such Holder (unless otherwise agreed by the Holders) and (y)
any number of securities in excess of the request of the Reuters Entities
pursuant to clause (B) above shall be reallocated among the requesting Holders
in a like manner). In the event that less than all of such Registrable
Securities may be included in such offering, any Holder may withdraw its request
for registration of its Registrable Securities under this Section 2.2; and

                  (ii)  second, up to the full number of the Registrable
Securities (other than Registrable Securities registered pursuant to clause
(i)), if any, in excess of the number of Registrable Securities and securities
of Reuters Entities to be sold in such offering pursuant to clause (i) above
which, in the good faith view of such investment banking firm, can be sold
without so adversely affecting such offering.

                  (iii) Any Registration withdrawn pursuant to Section 2.2(g)(i)
by all Holders participating in the Registration shall be deemed not to be a
Demand Registration for purposes of Section 2.2(b).

            (h) Registration Statement Form. Registrations under this Section
2.2 shall be on such appropriate registration form of the SEC (i) as shall be
selected by the Issuer and (ii) as shall permit the disposition of the
Registrable Securities in accordance with the intended method or methods of
disposition specified in the applicable Holders' requests for such registration.

            (i) Shelf Registration. Once the Issuer has become eligible to file
a Registration Statement with the SEC on Form S-3 (or any successor form or
other appropriate form under the

                                       10
<PAGE>
Securities Act) for an offering to be made on a continuous basis pursuant to
Rule 415 under the Securities Act (or any similar rule that may be adopted by
the SEC), a majority of the Holders may request that Issuer file a Registration
Statement on Form S-3; provided that Holders may not request a Demand
Registration during the period that such Registration Statement on Form S-3
remains effective; provided further that if (i) Issuer keeps such Registration
Statement effective for at least 180 days (excluding any days in which the use
of the Prospectus included in the Registration Statement is suspended) and (ii)
the Registration Statement covers the full amount of Registrable Securities of
the Holders, then Holders shall no longer be able to request a Demand
Registration or otherwise exercise their rights under Section 2.2 of this
Agreement.

            2.3   Piggyback Registrations.

            (a) Participation. (i) If the Issuer at any time proposes to file a
Registration Statement with respect to any offering of its securities for its
own account or for the account of any other Persons (other than (A) a
registration under Section 2.2, (B) a registration on Form S-4 or S-8 or any
successor form to such forms, (C) a registration of securities solely relating
to an offering and sale to employees or directors of the Issuer pursuant to any
employee stock plan or other employee benefit plan arrangement or (D) a
registration of securities issued solely in an acquisition or business
combination), then, as soon as practicable (but in no event less than twenty
(20) days prior to the proposed date of filing such Registration Statement), the
Issuer shall give written notice of such proposed filing to all Holders and
shall offer the Holders of such Registrable Securities the opportunity to
register such number of Registrable Securities as each such Holder may request
in writing (a "Piggyback Registration"). Subject to Section 2.3(b), the Issuer
shall use its best efforts to include in such Registration Statement all such
Registrable Securities which are requested to be included therein by written
notice from any Holder (the "Piggyback Notice") within 10 days after the receipt
by such Holder of Issuer's notice of the proposed filing of the Registration
Statement. If at any time after giving written notice of its intention to
register any securities and prior to the effective date of the Registration
Statement filed in connection with such registration, the Issuer shall determine
for any reason not to register or to delay registration of such securities, the
Issuer may, at its election, give written notice of such determination to each
Holder and, (x) in the case of a determination not to register, shall be
relieved of its obligation to register any Registrable Securities in connection
with such registration, and (y) in the case of a determination to delay
registering, shall be permitted to delay registering any Registrable Securities
for the same period as the delay in registering such other securities.

                  (ii)  If the offering pursuant to a Piggyback Registration is
to be an Underwritten Offering, then each Holder making a request for its
Registrable Securities to be included therein must, and the Issuer shall make
such arrangements with the underwriters so that each such Holder may,
participate in such Underwritten Offering on the same terms as the Issuer and
other Persons selling securities in such Underwritten Offering. If the offering
pursuant to such registration is to be on any other basis, then each Holder
making a request for a Piggyback Registration pursuant to this Section 2.3(a)
must participate in such offering on such basis.

                  (iii) Each Holder shall be permitted to withdraw all or part
of such Holder's Registrable Securities from a Piggyback Registration at any
time prior to the fifth calendar day immediately preceding the effective date of
such Piggyback Registration; provided,

                                       11
<PAGE>
that the Issuer shall be entitled to reimbursement from the Holder of such
withdrawn Registrable Securities for any SEC registration fees incurred by the
Issuer in connection with the registration of such Registrable Securities.

            (b) Priority of Piggyback Registration. If the managing underwriter
or underwriters of any proposed Underwritten Offering of Instinet Common Stock
included in a Piggyback Registration (or in the case of a Piggyback Registration
not being underwritten, the Issuer) informs the Holders seeking to be included
in such registration in writing that, in its or their opinion, the total amount
or kind of securities which such Holders and any other Persons intend to include
in such offering exceeds the number which can be sold in such offering without
being likely to have a significant adverse effect on the price, timing or
distribution of the securities offered in such offering or the market for
Instinet Common Stock, then the securities of each class to be included in such
registration shall be allocated as follows.

                  (i)   If the Underwritten Offering is on behalf of the Issuer:

                  (A) first, all securities Issuer proposes to sell for its own
account;

                  (B) second, all securities proposed to be sold by the Reuters
Entities and any other Person who beneficially owns a greater number of shares
of Instinet Common Stock than the Reuters Entities beneficially own, in excess
of the number of securities to be sold in such offering pursuant to clause (A)
above which, in the good faith view of such investment banking firm, can be sold
without adversely affecting such offering (and, if such number is less than the
full number sought to be registered by the Reuters Entities and such other
Persons, such number shall be allocated pro rata on the basis of the number of
securities requested to be included therein by the Reuters Entities and such
other Persons);

                  (C) third, and only if all the securities referenced in
clauses (A) and (B) have been included, the number of Registrable Securities and
the amount of Instinet Common Stock held by Holders and other Persons that have
a contractual right to participate in such registration that, in the opinion of
such underwriter or underwriters, can be sold without having such adverse effect
shall be included pro rata on the basis of the number of securities requested to
be included therein by such Holders and such other Persons.

                  (ii)  If the underwritten offering is made pursuant to the
exercise of demand registration rights other than by Holders:

                  (A) first, the number of securities proposed to be sold by
such other Persons (the "Other Holders") pursuant to the exercise of their
demand registration rights and (if the Other Holders are not Reuters Entities)
all securities sought to be included in such registration by the Reuters
Entities (and if that number is less than the full number of such Other Holders'
securities and Reuters Entities' securities sought to be included, such number
shall be allocated 66.67% among the Other Holders and 33.33% among the Reuters
Entities); and

                  (B) second, and only if all the securities referenced in
clause (A) have been included, the number of Registrable Securities and the
amount of Instinet Common Stock held by Holders and other Persons that have a
contractual right to participate in such registration that, in the opinion of
such underwriter or underwriters, can be sold without having such adverse

                                       12
<PAGE>
effect shall be included pro rata on the basis of the number of securities
requested to be included therein by such Holders and such Persons.

            2.4   Registration Procedures.

            (a) In connection with the Issuer's registration obligations in this
Agreement, the Issuer will, subject to the limitations set forth herein, use its
reasonable best efforts to effect any such registration so as to permit the sale
of the applicable Registrable Securities in accordance with the intended method
or methods of distribution thereof as expeditiously as reasonably practicable,
and in connection therewith the Issuer will:

                  (i)   before filing a Registration Statement or Prospectus, or
any amendments or supplements thereto and in connection therewith, furnish to
the underwriter or underwriters, if any, and to each of the Holders covered by
such Registration Statement, copies of all documents prepared to be filed, which
documents will be subject to the review of such underwriters and such Holders
and their respective counsel and the Issuer will in good faith consider any
comments thereon made by the Underwriter or such Holder;

                  (ii)  prepare and file with the SEC such amendments or
supplements to the applicable Registration Statement or Prospectus as may be (A)
reasonably requested by any participating Holder (to the extent such request
relates to information relating to such Holder) or (B) necessary to keep such
registration effective for the period of time required by this Agreement;

                  (iii) notify the selling Holders and the managing underwriter
or underwriters, if any, and (if requested) confirm such advice in writing, as
soon as reasonably practicable after notice thereof is received by the Issuer
(A) when the applicable Registration Statement or any amendment thereto has been
filed or becomes effective and when the applicable Prospectus or any amendment
or supplement thereto has been filed, (B) of any written comments by the SEC or
any request by the SEC or any other federal or state governmental authority for
amendments or supplements to such Registration Statement or Prospectus or for
additional information, (C) of the issuance by the SEC of any stop order
suspending the effectiveness of such Registration Statement or any order
preventing or suspending the use of any preliminary or final Prospectus or the
initiation or threat of any proceedings for such purposes and (D) of the receipt
by the Issuer of any notification with respect to the suspension of the
qualification of the Registrable Securities for offering or sale in any
jurisdiction or the initiation or threat of any proceeding for such purpose;

                  (iv)  promptly notify each selling Holder and the managing
underwriter or underwriters, if any, when the Issuer becomes aware of the
happening of any event as a result of which the applicable Registration
Statement or Prospectus (as then in effect) contains any untrue statement of a
material fact or omits to state a material fact necessary to make the statements
therein (in the case of the Prospectus and any preliminary Prospectus, in light
of the circumstances under which they were made) not misleading or, if for any
other reason it shall be necessary to amend or supplement such Registration
Statement or Prospectus in order to comply with the Securities Act and, in
either case as promptly as reasonably practicable thereafter,

                                       13
<PAGE>
prepare and file with the SEC an amendment or supplement to such Registration
Statement or Prospectus which will correct such statement or omission or effect
such compliance;

                  (v)   make every reasonable effort to prevent or obtain at the
earliest possible moment the withdrawal of any stop order with respect to the
applicable Registration Statement or other order suspending the use of any
preliminary or final Prospectus;

                  (vi)  promptly incorporate in a Prospectus supplement or
post-effective amendment to the applicable Registration Statement such
information as the managing underwriter or underwriters, if any, or the Holders
of a majority of the Registrable Securities being sold agree should be included
therein relating to the plan of distribution with respect to such Registrable
Securities; and make all required filings of such Prospectus supplement or
post-effective amendment as soon as reasonably practicable after being notified
of the matters to be incorporated in such Prospectus supplement or
post-effective amendment;

                  (vii) furnish to each selling Holder, its counsel and each
managing underwriter, if any, without charge, at least one conformed copy of the
applicable Registration Statement and any post effective amendment thereto,
including financial statements (but excluding all documents incorporated by
reference and all exhibits);

                  (viii) deliver to each selling Holder and each managing
underwriter, if any, without charge, as many copies of the applicable Prospectus
(including each preliminary Prospectus) as such Holder or managing underwriter
may reasonably request (it being understood that the Issuer consents to the use
of the Prospectus by each of the selling Holders and the underwriter or
underwriters, if any, in connection with the offering and sale of the
Registrable Securities covered by the Prospectus);

                  (ix)  on or prior to the date on which the applicable
Registration Statement is declared effective, use its reasonable best efforts to
register or qualify such Registrable Securities for offer and sale under the
securities or "Blue Sky" laws of each state and other jurisdiction of the United
States, as any such selling Holder or underwriter, if any, or their respective
counsel reasonably requests in writing, and do any and all other acts or things
reasonably necessary or advisable to keep such registration or qualification in
effect so as to permit the commencement and continuance of sales and dealings in
such jurisdictions for as long as may be necessary to complete the distribution
of the Registrable Securities covered by the Registration Statement; provided
that the Issuer will not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified or to take any action which would
subject it to taxation or general service of process in any such jurisdiction
where it is not then so subject;

                  (x)   cooperate with the selling Holders and the managing
underwriter, underwriters or agent, if any, to facilitate the timely preparation
and delivery of certificates representing Registrable Securities to be sold and
not bearing any restrictive legends;

                  (xi)  not later than the effective date of the applicable
Registration Statement, provide a CUSIP number for all Registrable Securities
and provide the applicable

                                       14
<PAGE>
transfer agent with printed certificates for the Registrable Securities which
certificates shall be in a form eligible for deposit with The Depository Trust
Company;

                  (xii) obtain for delivery to the selling Holders and to the
underwriter or underwriters, if any, an opinion or opinions from counsel for the
Issuer dated the effective date of the Registration Statement or, in the event
of an Underwritten Offering, the date of the closing under the underwriting
agreement, in customary form, scope and substance;

                  (xiii) in the case of an Underwritten Offering, use its
reasonable best efforts to obtain for delivery to the Issuer and the underwriter
or underwriters, if any, a cold comfort letter from the Issuer's independent
certified public accountants in customary form and covering such matters of the
type customarily covered by cold comfort letters as the managing underwriter or
underwriters reasonably request, dated the date of execution of the underwriting
agreement and brought down to the closing under the underwriting agreement;

                  (xiv) cooperate with each selling Holder and each underwriter
or agent, if any, participating in the disposition of such Registrable
Securities and their respective counsel in connection with any filings required
to be made with the NASD;

                  (xv)  use its reasonable best efforts to comply with all
applicable rules and regulations of the SEC and make generally available to the
Holders, as soon as reasonably practicable (but not more than 18 months) after
the effective date of the applicable Registration Statement, an earnings
statement satisfying the provisions of Section 11(a) of the Securities Act and
the rules and regulations promulgated thereunder;

                  (xvi) provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by the applicable Registration
Statement from and after a date not later than the effective date of such
Registration Statement;

                  (xvii) use its reasonable best efforts to cause all
Registrable Securities covered by the applicable Registration Statement to be
(A) listed on each securities exchange on which any of the Issuer's securities
of such class are then listed or (B) quoted and on each inter-dealer quotation
system on which any of the Issuer's securities of such class are then quoted, in
each case, if requested by a selling Holder or the managing underwriter or
underwriters, if any;

                  (xviii) make available upon reasonable notice at reasonable
times and for reasonable periods for inspection by a representative appointed by
the Holders of a majority of the Registrable Securities covered by the
applicable Registration Statement, by any managing underwriter or underwriters
participating in any disposition to be effected pursuant to such Registration
Statement and by any attorney, accountant or other agent retained by such
selling Holders or any such managing underwriter, all non-confidential,
pertinent financial and other records, pertinent corporate documents and
properties of the Issuer, and cause all of the Issuer's officers, directors and
employees and the independent public accountants who have certified its
financial statements to make themselves available to discuss the business of the
Issuer and to supply all information reasonably requested by any such selling
Holder, underwriter, attorney, accountant or agent in connection with such
Registration Statement as shall be necessary to enable them to exercise their
due diligence responsibility (subject to the entry by each party

                                       15
<PAGE>
referred to in this clause (xviii) into customary confidentiality agreements in
a form reasonably acceptable to the Issuer);

                  (xix) in the case of an Underwritten Offering of Instinet
Common Stock reasonably expected to have a value in excess of $50 million, cause
senior executive officers of the Issuer to be available on commercially
reasonable terms to meet with existing and potential investors; and

                  (xx)  use its reasonable diligence to take all other steps
necessary to effect the registration of the Registrable Securities contemplated
hereby.

            (b) The Issuer may require each selling Holder of Registrable
Securities as to which any Registration is being effected to furnish to the
Issuer such information regarding the distribution of such Securities and such
other information relating to such Holder and its ownership of the applicable
Registrable Securities as the Issuer may from time to time reasonably request.
Each Holder agrees to furnish such information to the Issuer and to cooperate
with the Issuer as necessary to enable the Issuer to comply with the provisions
of this Agreement. The Issuer shall have the right to exclude any Holder that
does not comply with the preceding sentence from the applicable Registration.

            (c) Each Holder agrees by acquisition of such Registrable Securities
that, upon receipt of any notice from the Issuer of the happening of any event
of the kind described in Section 2.4(a)(iv), such Holder will discontinue
disposition of its Registrable Securities pursuant to such Registration
Statement until such Holder's receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 2.4(a)(iv), or until such Holder is
advised in writing by the Issuer that the use of the Prospectus may be resumed,
and has received copies of any additional or supplemental filings that are
incorporated by reference in the Prospectus and, if so directed by the Issuer,
such Holder will deliver to the Issuer (at the Issuer's expense) all copies,
other than permanent file copies then in such Holder's possession, of the
Prospectus covering such Registrable Securities which are current at the time of
the receipt of such notice. In the event that the Issuer shall give any such
notice in respect of a Demand Registration, the period during which the
applicable Registration Statement is required to be maintained effective shall
be extended by the number of days during the period from and including the date
of the giving of such notice to and including the date when each seller of
Registrable Securities covered by such Registration Statement either receives
the copies of the supplemented or amended Prospectus contemplated by Section
2.4(a)(iv) or is advised in writing by the Issuer that the use of the Prospectus
may be resumed.

            2.5   Underwritten Offerings.

            (a) Underwriting Agreements. If requested by the underwriters for
any Underwritten Offering requested by Holders pursuant to Section 2.2, the
Issuer and the Holders of Registrable Securities to be included therein shall
enter into an underwriting agreement with such underwriters, such agreement to
be reasonably satisfactory in substance and form to the Issuer, the Holders of a
majority of the Registrable Securities to be included in such Underwritten
Offering and the underwriters, and to contain such terms and conditions as are
generally prevailing in agreements of that type, including, without limitation,
indemnities by the

                                       16
<PAGE>
Issuer, the participating Holders and the underwriters in favor of the Issuer,
the underwriters and the participating Holders, as applicable, which indemnities
are no less favorable to the recipient thereof than those provided in Section
2.7. The Holders of any Registrable Securities to be included in any
Underwritten Offering pursuant to Section 2.3 shall enter into such an
underwriting agreement at the request of the Issuer.

            (b) Price and Underwriting Discounts. In the case of an Underwritten
Offering requested by Holders pursuant to Section 2.2, the price, underwriting
discount and other financial terms for the Registrable Securities of the related
underwriting agreement shall be determined by the Holders of a majority of such
Registrable Securities. In the case of any Underwritten Offering pursuant to
Section 2.3, such price, discount and other terms shall be determined by the
Issuer, subject to the right of the Holders to withdraw their request to
participate in the registration pursuant to Section 2.3(a)(iii) after being
advised of such price, discount and other terms.

            (c) Participation in Underwritten Offerings. No Person may
participate in an Underwritten Offering unless such Person (i) agrees to sell
such Person's securities on the basis provided in any underwriting arrangements
approved by the Persons entitled to approve such arrangements and (ii) completes
and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting
arrangements.

            2.6   Registration Expenses. (a) The Issuer shall pay all of the
expenses set forth in this paragraph (a) in connection with a registration,
under this Agreement, of Registrable Securities. Such expenses are (i) all
registration and filing fees, and any other fees and expenses associated with
filings required to be made with the SEC or the NASD, (ii) all fees and expenses
of compliance with state securities or "Blue Sky" laws, including fees and
disbursements of counsel, (iii) all printing, duplicating, word processing,
messenger, telephone, facsimile and delivery expenses (including expenses of
printing certificates for the Registrable Securities in a form eligible for
deposit with The Depository Trust Company and of printing prospectuses), (iv)
all fees and disbursements of counsel for the Issuer, of all independent
certified public accountants of the Issuer and all other Persons retained by the
Issuer, (v) Securities Act liability insurance or similar insurance if the
Issuer so desires or the underwriter or underwriters, if any, so require in
accordance with then-customary underwriting practice, (vi) all fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange or the quotation of the Registrable Securities on any
inter-dealer quotation system and (vii) the reasonable fees and expenses of one
counsel for the holders of Registrable Securities, selected by the holders of a
majority of the Registrable Securities then outstanding, incurred in connection
with any registration hereunder. In addition, in all cases the Issuer shall pay
its internal expenses (including, without limitation, all salaries and expenses
of its officers and employees performing legal or accounting duties), the
expense of any audit and the fees and expenses of any Person, including special
experts, retained by the Issuer.

            (b) Other than as set forth in Section 2.6(a) and discounts,
commissions and transfer taxes attributable to shares of the Issuer or another
Person that is not a Holder of a Registrable Security, the Issuer shall not be
required to pay any other costs or expenses in the course of the transactions
contemplated hereby, including underwriting discounts and

                                       17
<PAGE>
commissions and transfer taxes attributable to the sale of Registrable
Securities and the fees and expenses of counsel to one or more of the Holders.

            2.7   Indemnification.

            (a) Indemnification by the Issuer. The Issuer agrees to indemnify
and hold harmless, to the full extent permitted by law, each Holder and their
respective officers, directors and employees and each Person who controls
(within the meaning of the Securities Act or the Exchange Act) such Persons from
and against any and all losses, claims, damages, liabilities (or actions or
proceedings in respect thereof, whether or not such indemnified party is a party
thereto) and expenses (including reasonable costs of investigation and legal
expenses), joint or several (each, a "Loss" and collectively "Losses"), arising
out of or based upon (i) any untrue or alleged untrue statement of a material
fact contained in any Registration Statement under which such Registrable
Securities were registered under the Securities Act (including any final,
preliminary or summary Prospectus contained therein or any amendment thereof or
supplement thereto or any documents incorporated by reference therein) or (ii)
any omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of a
Prospectus or preliminary Prospectus, in light of the circumstances under which
they were made) not misleading; provided, however, that the Issuer shall not be
liable to any indemnified party in any such case to the extent that any such
Loss arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any such Registration
Statement in reliance upon and in conformity with written information furnished
to the Issuer by or on behalf of such Holder, underwriter or other Person
selling under the applicable Registration Statement, expressly for use in the
preparation thereof; and provided, further, that the Issuer will not be liable
to any indemnified party in any case to the extent that any such Loss arises out
of or is based upon any untrue statement or alleged untrue statement or omission
or alleged omission made in any final, preliminary or summary Prospectus if such
untrue statement or alleged untrue statement or omission or alleged omission is
corrected in an amendment or supplement to such Prospectus which has been made
available to the Holders and the relevant Holder fails to deliver such
Prospectus as so amended or supplemented, if such delivery is required under
applicable law or the applicable rules of any securities exchange, prior to or
concurrently with the sales of the Registrable Securities to the Person
asserting such loss, claim, damage, liability or expense. This indemnity shall
be in addition to any liability Issuer may otherwise have.

            (b) Indemnification by the Holders. Each selling Holder agrees
(severally and not jointly) to indemnify and hold harmless, to the full extent
permitted by law, the Issuer, its directors and officers and each Person who
controls the Issuer (within the meaning of the Securities Act and the Exchange
Act) from and against any Losses resulting from any untrue statement or alleged
untrue statement of a material fact or any omission or alleged omission of a
material fact required to be stated in the Registration Statement under which
such Registrable Securities were registered under the Securities Act (including
any final, preliminary or summary Prospectus contained therein or any amendment
thereof or supplement thereto or any documents incorporated by reference
therein), or necessary to make the statements therein (in the case of a
Prospectus or preliminary Prospectus, in light of the circumstances under which
they were made) not misleading, to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged omission had
been contained in any information furnished in

                                       18
<PAGE>
writing by such selling Holder to the Issuer specifically for inclusion in such
Registration Statement. This indemnity shall be in addition to any liability
such Holder may otherwise have.

            (c) Conduct of Indemnification Proceedings. (i) Any Person entitled
to indemnification under this Section 2.7 shall give notice to the party
required to provide indemnification promptly after such indemnified party has
actual knowledge that a claim is to be made against the indemnified party as to
which indemnity may be sought, and shall permit the indemnifying party to assume
the defense of such claim or litigation resulting therefrom and any related
settlement and settlement negotiations, subject to the limitations on settlement
set forth below; provided, that counsel for the indemnifying party, who shall
conduct the defense of such claim or any litigation resulting therefrom, shall
be approved by the indemnified party (whose approval shall not unreasonably be
withheld), and the indemnified party may participate in such defense at such
party's expense; and provided, further, that the failure of any indemnified
party to give notice as provided herein shall not relieve the indemnifying party
of its obligations under this Section 2.7 to the extent such failure is not
materially prejudicial. If such defense is not assumed by the indemnifying
party, the indemnifying party will not be subject to any liability for any
settlement made without its consent, but such consent may not be unreasonably
withheld. Notwithstanding the preceding sentence, the indemnifying party may, at
its sole discretion, withhold its consent to any settlement involving the
imposition of equitable remedies or involving the imposition of any material
obligations on such indemnifying party other than financial obligations for
which such indemnified party will be indemnified hereunder.

                  (ii)  An indemnified party shall have the right to retain
separate counsel, with the reasonable fees and expenses of such counsel being
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 or if the indemnifying party has failed
to assume the defense of such action (provided that in no event shall the
indemnifying party be responsible for the fees and costs of more than one such
additional counsel for all indemnified parties). 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
that does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release, reasonably
satisfactory to the indemnified party, from all liability in respect to such
claim or litigation. Each indemnified party shall furnish such information
regarding itself or the claim in question as an indemnifying party may
reasonably request in writing and as shall be reasonably required in connection
with defense of such claim and litigation resulting therefrom.

            (d) Contribution. (i) If for any reason the indemnification provided
for in the paragraphs (a) and (b) of this Section 2.7 is unavailable to an
indemnified party or insufficient to hold it harmless as contemplated by
paragraphs (a) and (b) of this Section 2.7, then the indemnifying party shall
contribute to the amount paid or payable by the indemnified party as a result of
such Loss in such proportion as is appropriate to reflect the relative fault of
the indemnifying party on the one hand and the indemnified party on the other.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the indemnifying party or the indemnified party and the parties'
relative

                                       19
<PAGE>
intent, knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission.

                  (ii)  The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 2.7(d) were determined by pro
rata allocation or by any other method of allocation that does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation. If
indemnification is available under this Section 2.7, the indemnifying parties
shall indemnify each indemnified party to the full extent provided in Sections
2.7(a) and 2.7(b) hereof without regard to the relative fault of said
indemnifying parties or indemnified party.

            2.8   Rule 144. The Issuer will file the reports required to be
filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder (or, if the Issuer is not required to
file such reports, it will, upon the request of any Holder of Registrable
Securities after the transfer date, make publicly available other information so
long as necessary to permit sales pursuant to Rule 144 under the Securities
Act), and it will take such further action as any Holder may reasonably request,
all to the extent reasonably required from time to time to enable such Holder to
sell Registrable Securities without registration under the Securities Act within
the limitation of the exemptions provided by (i) Rule 144, as such Rule may be
amended from time to time, or (ii) any similar rule or regulation hereafter
adopted by the SEC. Notwithstanding the foregoing, any such sales by Holders
pursuant to Rule 144 shall be made subject to Holder's obligations under Section
2.1 of this Agreement.

                                   ARTICLE III

                                  MISCELLANEOUS

            3.1   Term. This Agreement shall terminate with respect to each
Holder upon the earlier of (i) the second anniversary of the date hereof or (ii)
the date as of which there are no Registrable Securities. The provisions of
Section 2.7 shall survive any termination of this Agreement.

            3.2   Injunctive Relief. It is hereby agreed and acknowledged that
it will be impossible to measure in money the damages that would be suffered if
the Parties fail to comply with any of the obligations herein imposed on them
and that in the event of any such failure, an aggrieved Person will be
irreparably damaged and will not have an adequate remedy at law. Any such Person
shall, therefore, be entitled (in addition to any other remedy to which it may
be entitled in law or in equity) to injunctive relief, including, without
limitation, specific performance, to enforce such obligations, and if any action
should be brought in equity to enforce any of the provisions of this Agreement,
none of the parties hereto shall raise the defense that there is an adequate
remedy at law.

            3.3   Notices. All notices, demands, instructions, waivers, consents
or other communications to be provided pursuant to this Agreement shall be in
writing, shall be effective

                                       20
<PAGE>
upon receipt, and shall be sent by hand, facsimile, air courier or registered
mail, return receipt requested, as follows:

            (a) if to Issuer, to:

                  Instinet Group Incorporated
                  3 Times Square
                  New York, New York 10036
                  Attention:  Paul A. Merolla
                  Telephone: (212) 310-7548
                  Facsimile: (212) 593-8040

                  with a copy to:

                  Cleary, Gottlieb, Steen & Hamilton
                  One Liberty Plaza
                  New York, NY  10006
                  Attention:  Yvette Teofan
                  Telephone:  (212) 225-2636
                  Facsimile:  (212) 225-3999

            (b) if to Holders, to:

                  David R. Burch
                  900 River Hills Rd.
                  Austin, Texas 78733
                  Telephone:  (512) 306-1192
                  Facsimile:  (512) 306-1513

                  with a copy to:

                  Vinson & Elkins, L.L.P.
                  1455 Pennsylvania Ave. N.W., Ste 600
                  Washington, DC  20004-1008
                  Attention:  Jay H. Hebert
                  Telephone:  (202) 639-6521
                  Facsimile:  (202) 630-6604

or to such other address as a Party may specify by notice from time to time in
writing to the other Parties in the manner specified in this Section 3.3.

            3.4   Successors, Assigns and Transferees. This Agreement shall be
binding upon and shall inure to the benefit of the Parties, and their respective
successors and permitted assigns. The registration rights of any Holder under
this Agreement with respect to any Registrable Securities may not be Transferred
or assigned, without the prior written consent of the Issuer, other than an
assignment to a Permitted Transferee; provided, that a transfer to an Affiliate
shall not relieve the Holder of its obligations hereunder. Any Transfer or
assignment made other than as provided in the first sentence of this Section 3.4
shall be null and void.

                                       21
<PAGE>
            3.5   Governing Law; Submission to Jurisdiction; Appointment of
Agent for Service of Process.

            (a) THE AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK. Each Party hereby irrevocably agrees
that any legal action or proceeding against it arising out of this Agreement or
the transactions contemplated hereby shall be brought only in the Supreme Court
of the State of New York in and for the County of New York or the U.S. District
Court for the Southern District of New York, preserving, however, all rights of
removal to a federal court under 28 U.S.C. Section 1441. Issuer hereby
irrevocably designates, appoints and empowers CT Corporation System, with
offices currently at 111 Eighth Avenue, New York, New York 10011 as its lawful
agent to receive for and on its behalf service of process in the State of New
York in any such action or proceeding. Each Seller hereby irrevocably
designates, appoints and empowers Capitol Services, Inc., with offices currently
at 40 Colvin Avenue, Suite 200, Albany, New York 12206 as its lawful agent to
receive for and on its behalf service of process in the State of New York in any
such action or proceeding. Each Party irrevocably consents to the service of
process outside the territorial jurisdiction of said courts in any such action
or proceeding by mailing copies thereof by registered United States mail,
postage prepaid, to its address as specified in or pursuant to this Section 3.5.
Any service made on such agent or its successor shall be effective when
delivered regardless of whether notice thereof is given to affected Party. If
any Person or firm designated as agent hereunder shall no longer serve as agent
of such Party to receive service of process in the State of New York, the Party
so affected shall be obligated promptly to appoint a successor to so serve; and,
unless and until such successor is appointed and the other Parties notified of
the same in writing, service upon the last designated agent shall be good and
effective. Each Party hereby agrees to at all times maintain an agent to receive
service of process in the State of New York pursuant to this Section 3.5. The
foregoing provisions of this Section 3.5 shall not affect, limit or prevent any
Party from serving process in any other manner permitted by law.

            (b) Each Party irrevocably waives any objection to the venue of the
courts designated in Section 3.5 (whether on the basis of forum non conveniens
or otherwise), and accepts and submits to the jurisdiction of such courts in
connection with any legal action or proceeding against it arising out of or
concerning this Agreement.

            3.6   Headings. The section and paragraph headings contained in this
Agreement are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.

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

            3.8   Amendment; Waiver.

                                       22
<PAGE>
            (a) Subject to the provisions of Section 3.10, this Agreement may
not be amended or modified and waivers and consents to departures from the
provisions hereof may not be given, except by an instrument or instruments in
writing making specific reference to this Agreement and signed by the Issuer and
each Holder. Each Holder and its permitted assignees shall be bound by any
amendment, modification, waiver or consent authorized by this Section 3.8(a),
whether or not such Registrable Securities shall have been marked accordingly.

            (b) The waiver by any party hereto of a breach of any provision of
this Agreement shall not operate or be construed as a further or continuing
waiver of such breach or as a waiver of any other or subsequent breach. Except
as otherwise expressly provided herein, no failure on the part of any party to
exercise, and no delay in exercising, any right, power or remedy hereunder, or
otherwise available in respect hereof at law or in equity, shall operate as a
waiver thereof, nor shall any single or partial exercise of such right, power or
remedy by such party preclude any other or further exercise thereof or the
exercise of any other right, power or remedy.

            3.9   Counterparts. This Agreement may be executed in any number of
separate counterparts and by the Parties hereto in separate counterparts each of
which when so executed shall be deemed to be an original and all of which
together shall constitute one and the same agreement.

            3.10  Other Registration Rights. Except with respect to registration
rights granted by the Issuer prior to the date hereof, without the prior written
consent of each of the Holders, the Issuer will not grant any Person (excluding
the Holders) any demand or piggyback registration rights with respect to any
securities of the Issuer which are more favorable to such Person than the rights
granted to the Holders by this Agreement. Notwithstanding the foregoing or any
other provisions of this Agreement, the Issuer may add as a "Holder" under this
Agreement any Person to whom the Issuer issues or otherwise delivers Instinet
Common Stock in connection with the acquisition by the Issuer or any of its
Affiliates of assets or equity interests on or prior to the first anniversary of
this Agreement.

                            [SIGNATURE PAGE FOLLOWS]

                                       23
<PAGE>
            IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be duly executed as of the date first written above.

                              INSTINET GROUP INCORPORATED

                               By:
                                  ------------------------------------
                                  Name:
                                  Title:

                                 OVERUNDER, LLC

                               By:
                                  ------------------------------------
                                  Name:       Andrew S. Kershner
                                  Title:      Sole Member

                               ----------------------------------------
                               David G. Jamail

                               ----------------------------------------
                               David R. Burch

                               ----------------------------------------
                               John A. McEntire, IV

                               ----------------------------------------
                               John Bunda

                               ----------------------------------------
                               Laura Horne

                               ----------------------------------------
                               Currin Van Eman

                               ----------------------------------------
                               Shayne Young

                                       24

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