Fill and Sign the Amendment 1 Rights Form

AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT This Amendment No. 1 (the "Amendment") to Registration Rights Agreement dated as of January 12, 1998 (the "Rights Agreement") is made and entered into as of January 12, 1999 pursuant to Section 19 of the Rights Agreement by and among Turnstone Systems, Inc., a Delaware corporation, and the purchasers of the Company's Series A Preferred Stock pursuant to the Series A Preferred Stock Purchase Agreement dated January 12, 1998 (the "Series A Purchasers"). Capitalized terms used in this Amendment that are not otherwise defined herein shall have the respective meanings assigned to them in the Rights Agreement. RECITALS WHEREAS, Section 20(b) of the Rights Agreement permits the Company to grant additional registration rights on a pari passu basis with those granted to the Series A Purchasers pursuant to the Rights Agreement, and Section 19 of the Rights Agreement permits amendment thereof by written consent of the Company and holders of 66-2/3% of the outstanding shares of Registrable Securities; WHEREAS, certain of the Series A Purchasers and certain other entities have agreed to purchase shares of the Company's Series B Preferred Stock (the "Series B Shares") pursuant to the Series B Preferred Stock Purchase Agreement dated December 23, 1998; WHEREAS, the Company has agreed to grant the purchasers of the Series B Shares registration rights on a pari passu basis with those currently held by the Series A Purchasers. WHEREAS, the Series A Purchasers and the Company wish to enter this Amendment to clarify the definition section of the Rights Agreement and to include as Registrable Securities thereunder future series of Preferred Stock of the Company (including the Series B Shares) that may be issued pursuant to stock purchase agreements approved by the Board of Directors. AGREEMENT NOW, THEREFORE, the parties hereto hereby agree as follows: 1. For purposes of the Rights Agreement, each reference to "Series A Preferred" shall hereafter be deemed to refer to the "Preferred." 2. For purposes of the Rights Agreement, "Preferred" shall mean shares of any series of the Preferred Stock of the Company issued and sold by the Company pursuant to a stock purchase agreement approved by the Company's Board of Directors. 3. The definition of "Series A Preferred" in Section 1 of the Rights Agreement shall be deleted in its entirety. 4. The definition of Purchaser in Section 1 of the Rights Agreements is hereby amended and restated to read as follows: 7 "Purchaser" shall mean each person or entity who has acquired shares of Preferred and who is a signatory to this Agreement or who holds Registrable Securities and may become a signatory pursuant to Section 20(b) hereof. 5. This Amendment shall also be deemed to make each of the undersigned a signatory to the Rights Agreement pursuant to Section 20(b) thereof. 6. Except as expressly set forth in this Amendment, the Rights Agreement shall continue in full force and effect in accordance with its terms. 7. This Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Amendment shall be governed by and construed and enforced in accordance with the laws of the State of California, without reference to the conflict of laws provisions thereof. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 8 IN WITNESS WHEREOF, the parties hereto have caused this AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT to be executed as of the date first above written. "COMPANY" TURNSTONE SYSTEMS A DELAWARE CORPORATION By: /s/ Richard N. Tinsley -------------------------------- Name: Richard N. Tinsely ------------------------------ Title: CEO ----------------------------- "PURCHASERS" INSTITUTIONAL VENTURE PARTNERS VII, L.P., BY ITS GENERAL PARTNER INSTITUTIONAL VENTURE MANAGEMENT VII, L.P. /s/ Geoffrey Yang ----------------------------------- Geoffrey Y. Yang, General Partner INSTITUTIONAL VENTURE MANAGEMENT VII, L.P. /s/ Geoffrey Yang ----------------------------------- Geoffrey Y. Yang, General Partner IVP FOUNDERS FUND I, L.P., BY ITS GENERAL PARTNER INSTITUTIONAL VENTURE MANAGEMENT VI, L.P. /s/ Geoffrey Yang ----------------------------------- Geoffrey Y. Yang, General Partner [SIGNATURE PAGE TO AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT] 9 "PURCHASERS" (CONT'D) MATRIX PARTNERS V, L.P. By: Matrix V Management Company, L.L.C. Its General Partner /s/ Andrew Verhalen ----------------------------------- By: Andrew W. Verhalen, Member [SIGNATURE PAGE TO AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT] 10 "PURCHASERS" (CONT'D) BENCHMARK CAPITAL PARTNERS II, L.P. as nominee for BENCHMARK CAPITAL PARTNERS, II, L.P. BENCHMARK FOUNDERS' FUND II, L.P. BENCHMARK FOUNDERS' FUND II-A, L.P. BENCHMARK MEMBERS' FUND II, L.P. By: Benchmark Capital Management Co. II, L.L.C. Its General Partner By: /s/ Andrew S. Rachleff ------------------------------- Managing Member [SIGNATURE PAGE TO AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT] 11 "PURCHASERS" (CONT'D) WS INVESTMENT COMPANY 97B By: /s/ Thomas C. DeFilipps ---------------------------------- Thomas C. DeFilipps, General Partner /s/ Thomas C. DeFilipps ------------------------------------- Thomas C. DeFilipps COMDISCO, INC. By: /s/ James P. Labe --------------------------------- Name: James P. Labe ------------------------------- Title: President, Comdisco Ventures Division ------------------------------------- IVP BROADBAND FUND, L.P., BY ITS GENERAL PARTNER IVP BROADBAND MANAGEMENT, LLC BY ITS MANAGING DIRECTOR, INSTITUTIONAL VENTURE MANAGEMENT VIII, LLC By: /s/ Geoffrey Yang --------------------------------- Geoffrey Y. Yang, Managing Director [SIGNATURE PAGE TO AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT] 12 "PURCHASERS" (CONT'D) STANFORD UNIVERSITY By: /s/ H. A. Turner --------------------------------- Name: Harry A. Turner ------------------------------- Title: Managing Director, Stanford Management Company ------------------------------ [SIGNATURE PAGE TO AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT] 13 IN WITNESS WHEREOF, the parties hereto have caused this Addendum Signature Page to Registration Rights Agreement to be executed as of the date first above written. "COMPANY" TURNSTONE SYSTEMS, INC. A DELAWARE CORPORATION By: /s/ Richard N. Tinsley -------------------------------- Name: Richard N. Tinsley ------------------------------ Title: CEO ----------------------------- "ADDITIONAL PURCHASER" CHARLES ROSS PARTNERS INVESTMENT FUND NUMBER 7 By: /s/ Gregory E. Lawler -------------------------------- Name: Gregory E. Lawler ------------------------------ Title: General Partner -----------------------------