Fill and Sign the Rights Agreement Form

AMENDMENT NO. 2 TO REGISTRATION RIGHTS AGREEMENT This Amendment No. 2 (the "Amendment") to Registration Rights Agreement dated as of January 12, 1998 (the "Rights Agreement") and amended by Amendment No. 1 to Registration Rights Agreement dated as of January 12, 1999, is made and entered into as of November 21, 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") and the purchasers of the Company's Series B Preferred Stock pursuant to the Series B Preferred Stock Purchase Agreements dated January 12, 1999 and June 21, 1999 (the "Series B Purchasers" and together with the Series A Purchasers, the "Preferred Holders"). 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 6(a) of the Rights Agreement grants the Preferred Holders the right to include their Registrable Securities in any registration by the Company of its securities, for its own account or the account of a security holder or holders exercising their demand registration rights, other than registrations relating solely to employee benefit plans or registrations relating solely to transactions pursuant to Rule 145 promulgated under the Securities Act, 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; and WHEREAS, the Preferred Holders and the Company wish to enter this Amendment to amend and waive their registration rights under Section 6(a). NOW, THEREFORE, the parties hereto hereby agree as follows: AGREEMENT 1. Section 6(a) of the Rights Agreement is hereby amended and restated to read as follows: Notice of Registration. If the Company shall determine to register any of its securities, either for its own account or the account of a security holder or holders exercising their respective demand registration rights, other than (i) a registration relating solely to employee benefit plans; (ii) a registration relating solely to a transaction pursuant to Rule 145 promulgated under the Securities Act; or (iii) the initial public offering of the Company's common stock, the Company will: (x) promptly give to each Holder written notice thereof; and (y) include in such registration (and any related qualification under blue sky laws or other compliance), and in any underwriting involved therein, all the Registrable Securities specified in a written request or requests, made within 30 days after receipt of such written notice from the Company, by any Holder or Holders. 2 2. Section 6(b) of the Rights Agreement is hereby amended to delete the following of phrase at the end of the first sentence (such that the first sentence shall now end immediately before such phrase): ", provided that in the case of the Company's initial public offering, the managing underwriter shall include in such offering at least 25% of the Registrable Securities requested to be included in such offering" 3. Except as expressly set forth in this Amendment, the Rights Agreement shall continue in full force and effect in accordance with its terms. 4. 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] 2 3 IN WITNESS WHEREOF, the parties hereto have caused this AMENDMENT NO. 2 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. Tinsley ----------------------------------- Title: CEO ----------------------------------- "PREFERRED HOLDERS" MATRIX PARTNERS V, L.P. By: Matrix V Management Company, L.L.C. Its General Partner /s/ ANDREW W. VERHALEN ----------------------------------------- By: Andrew W. Verhalen, Member MATRIX PARTNERS ENTREPRENEURS FUND, L.P. By: Matrix V Management Company, L.L.C. Its General Partner /s/ ANDREW W. VERHALEN ----------------------------------------- By: Andrew W. Verhalen, Member [SIGNATURE PAGE TO AMENDMENT NO. 2 TO REGISTRATION RIGHTS AGREEMENT] 3 4 "PREFERRED HOLDERS" (CONT'D) INSTITUTIONAL VENTURE PARTNERS VII, L.P., BY ITS GENERAL PARTNER INSTITUTIONAL VENTURE MANAGEMENT VII, L.P. /s/ GEOFFREY Y. YANG ----------------------------------------- Geoffrey Y. Yang, General Partner INSTITUTIONAL VENTURE MANAGEMENT VII, L.P. /s/ GEOFFREY Y. YANG ----------------------------------------- Geoffrey Y. Yang, General Partner IVP FOUNDERS FUND I, L.P., BY ITS GENERAL PARTNER INSTITUTIONAL VENTURE MANAGEMENT VI, L.P. /s/ GEOFFREY Y. YANG ----------------------------------------- Geoffrey Y. Yang, General Partner IVP BROADBAND MANAGEMENT, LLC BY ITS MANAGING DIRECTOR, INSTITUTIONAL VENTURE MANAGEMENT VIII, LLC By: /s/ GEOFFREY Y. YANG -------------------------------------- Geoffrey Y. Yang, Managing Director [SIGNATURE PAGE TO AMENDMENT NO. 2 TO REGISTRATION RIGHTS AGREEMENT] 4 5 "PREFERRED HOLDERS" (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: ------------------------------------- , Managing Member [SIGNATURE PAGE TO AMENDMENT NO. 2 TO REGISTRATION RIGHTS AGREEMENT] 5 6