GFI Group (GFIG)

Series B Convertible Preferred Stock

        Conversion:    Each share of Series B Convertible Preferred Stock (the "Series B Preferred Stock") was automatically convertable into shares of Class B Common Stock, immediately prior to the closing of an IPO, at an initial conversion rate of one share of Class B Common Stock for each share of Series B Preferred Stock. Upon completion of the Company's IPO in January 2005, each share of Series B Preferred Stock was automatically converted into approximately 1.0017 shares of Class B Common Stock. See Note 25 for further details.

        Dividends:    Before the payment of any dividends in respect of any shares of GFI Common Stock, the holders of the Series B Preferred Stock (on an as-if-converted to GFI Class B Common Stock basis) are entitled to share ratably with the holders of GFI Common Stock in certain dividends declared on the Class B Common.

        Voting Rights:    Except as provided by law, the Series B Preferred Stock generally does not have any voting rights. To the extent the Series B Preferred Stock has voting rights, such stock is required to be voted equally with the shares of Class B Common Stock, and not as a separate class.

        Liquidation Preference:    In the event of any voluntary or involuntary liquidation, dissolution or winding-up of GFI, before any payment or distribution of the assets of GFI, or the proceeds thereof, may be made or set apart for the holders of any stock ranking junior to the Series B Preferred Stock upon liquidation, the holders of Series B Preferred Stock are entitled to receive a liquidating distribution of $14.25 per share, plus any accrued and unpaid dividends.

        Rank:    The Series B Preferred Stock generally ranks senior to the GFI Common Stock and on parity with the Series A Preferred Stock as to payment of dividends, voting, distributions of assets upon liquidation, dissolution or winding-up, whether voluntary or involuntary, or otherwise.

        Dividends to JPI—Prior to the Company's corporate reorganization in November 2001, GFI paid dividends to JPI in amounts at least equal to the amount of corporate income taxes that would have been payable had JPI not been an S corporation. Amounts paid were $0, $0 and $4,536 for the years ended December 31, 2004, 2003 and 2002, respectively. The amount paid in 2002 related to JPI's tax liabilities for the 11-month period ended November 30, 2001.

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