MF Global 2011Q2 10Q

MF Global Holdings Ltd.

10-Q Quarterly report pursuant to sections 13 or 15(d)

Filed on 08/03/2011Filed Period 06/30/2011

http://accelus.thomsonreuters.com/

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the QUARTERLY PERIOD ended June 30, 2011

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-33590

MF GLOBAL HOLDINGS LTD.(Exact name of registrant as specified in its charter)

Delaware 98-0551260(State or other jurisdiction of

incorporation or organization)

(I.R.S. EmployerIdentification No.)

717 Fifth AvenueNew York, NY 10022

(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (212) 589-6200

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934

during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filingrequirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data Filerequired to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorterperiod that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.See definition of "accelerated filer and large accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨ (Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

The number of common stock outstanding of the registrant as of June 30, 2011, was 164,892,596.

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MF GLOBAL HOLDINGS LTD.

INDEX TO FORM 10-Q

PART I.—FINANCIAL INFORMATION Item 1. Unaudited Consolidated Financial Statements and Supplementary Data 3

Unaudited Consolidated Statements of Operations 3 Unaudited Consolidated Balance Sheets 4 Unaudited Consolidated Statements of Cash Flows 5 Unaudited Consolidated Statement of Changes in Equity 7 Unaudited Consolidated Statements of Comprehensive Income 8 Notes to Unaudited Consolidated Financial Statements 9

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 53 Item 3. Quantitative and Qualitative Disclosures About Market Risk 85 Item 4. Controls and Procedures 97

PART II—OTHER INFORMATION Item 1. Legal Proceedings 97 Item 1A. Risk Factors 103 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 103 Item 3. Defaults Upon Senior Securities 103 Item 4. (Removed and Reserved) 103 Item 5. Other Information 103 Item 6. Exhibits 103

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PART I.—FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements and Supplementary Data


CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)

(Dollars in thousands, except per share and share amounts)

Three months ended

June 30,

2011 2010 Revenues

Commissions $ 364,699 $ 376,646 Principal transactions 116,767 66,342 Interest income 122,224 114,232 Other 7,553 11,872

Total revenues 611,243 569,092 Interest and transaction-based expenses:

Interest expense 41,577 45,431 Execution and clearing fees 186,487 175,196 Sales commissions 68,661 59,030

Total interest and transaction-based expenses 296,725 279,657 Revenues, net of interest and transaction-based expenses 314,518 289,435

Expenses Employee compensation and benefits (excluding non-recurring IPO awards) 171,098 155,374 Employee compensation related to non-recurring IPO awards — 8,595 Communications and technology 39,107 31,427 Occupancy and equipment costs 16,014 11,103 Depreciation and amortization 10,282 10,534 Professional fees 23,990 18,057 General and other 22,112 19,468 Restructuring charges 2,140 9,874 Impairment of goodwill 694 848

Total other expenses 285,437 265,280 Gains on exchange seats and shares 2,235 1,958 Interest on borrowings 13,751 9,535

Income before provision for income taxes 17,565 16,578 Provision for income taxes 4,843 8,141 Equity in income of unconsolidated companies (net of tax) 838 627

Net income 13,560 9,064 Net income attributable to noncontrolling interest (net of tax) 251 243

Net income applicable to MF Global Holdings Ltd. $ 13,309 $ 8,821

Dividends declared on preferred stock 5,005 7,678 Cumulative and participating dividends 630 360

Net income applicable to common shareholders $ 7,674 $ 783

Earnings per share (see Note 15): Basic $ 0.05 $ 0.01 Diluted $ 0.05 $ 0.01

Weighted average number of shares of common stock outstanding: Basic 164,272,690 130,196,655 Diluted 164,293,357 133,999,818

The accompanying notes are an integral part of these consolidated financial statements.

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CONSOLIDATED BALANCE SHEETS(Unaudited)


June 30,

2011

March 31,2011

Assets Cash and cash equivalents $ 709,379 $ 649,394 Restricted cash and segregated securities 10,924,249 11,371,350 Securities purchased under agreements to resell (including $11,974,402 and $11,898,502 at fair value, respectively) 12,057,793 9,499,768 Securities borrowed 4,954,218 2,890,840 Securities received as collateral 153,215 147,185 Securities owned ($9,139,354 and $9,365,531 pledged, respectively) 11,573,484 10,831,346 Receivables:

Brokers, dealers and clearing organizations 4,629,465 4,233,137 Customers (net of allowances of $12,362 and $12,739 respectively) 319,310 389,544 Other 134,154 65,435

Memberships in exchanges, at cost (fair value of $14,181 and $17,147, respectively) 4,502 5,851 Furniture, equipment and leasehold improvements, net 151,736 138,393 Intangible assets, net 39,213 41,912 Other assets 279,021 277,447

TOTAL ASSETS $45,929,739 $40,541,602

Liabilities and Equity Short-term borrowings, including current portion of long-term borrowings $ 366,088 $ 382,961 Securities sold under agreements to repurchase (including $8,667,980 and $7,232,434 at fair value, respectively) 17,968,868 16,626,875 Securities loaned (including $777 and $0 at fair value, respectively) 1,601,731 1,420,181 Obligation to return securities received as collateral 153,215 147,185 Securities sold, not yet purchased, at fair value 8,300,617 5,052,486 Payables:

Brokers, dealers and clearing organizations 1,779,621 1,133,635 Customers 13,567,108 13,577,197

Accrued expenses and other liabilities 255,146 282,658 Long-term borrowings 417,152 414,080

TOTAL LIABILITIES 44,409,546 39,037,258

Commitments and contingencies (Note 11) Preferred stock, $1.00 par value per share; 200,000,000 shares authorized;

1,500,000 Series A Convertible, issued and outstanding, cumulative 96,167 96,167 403,550 Series B Convertible, issued and outstanding, non-cumulative 34,446 34,446

EQUITY Common stock, $1.00 par value per share; 1,000,000,000 shares authorized, 164,892,596 and 163,595,695 shares issued and

outstanding, respectively 164,893 163,596 Additional paid-in capital 1,595,428 1,597,183 Accumulated other comprehensive income (net of tax) 6,616 3,899 Accumulated deficit (396,330) (409,639) Noncontrolling interest 18,973 18,692

TOTAL EQUITY 1,389,580 1,373,731

TOTAL LIABILITIES AND EQUITY $45,929,739 $40,541,602


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CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)

(Dollars in thousands)

Three months ended

June 30,

2011 2010 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 13,560 $ 9,064

Less: Net income attributable to noncontrolling interest, net of tax 251 243

Net income attributable to MF Global Holdings Ltd. 13,309 8,821 Adjustments to reconcile net income to net cash provided by/(used in) operating activities:

Gains on sale of exchanges seats and shares (2,235) (30) Depreciation and amortization 10,282 10,534 Stock-based compensation expense 10,053 18,122 Bad debt expense (66) 87 Deferred income taxes 4,825 (7,096) Equity in income of unconsolidated affiliate (838) (627) Dividend received from unconsolidated affiliate 141 — Income attributable to noncontrolling interest, net of tax 251 243 Amortization of debt issuance costs 2,326 1,719 Accretion of debt discount 3,071 — Impairment of goodwill 694 848 Decrease/(increase) in operating assets:

Restricted cash and segregated securities 455,743 198,526 Securities purchased under agreements to resell (2,558,024) 6,623,665 Securities borrowed (2,063,389) 103,517 Securities owned (739,689) (5,178,271) Receivables:

Brokers, dealers and clearing organizations (387,905) 1,220,875 Customers 70,405 (51,537) Other (68,669) (31,468)

Other assets (9,079) 3,185 Increase/(decrease) in operating liabilities:

Securities sold under agreements to repurchase 1,342,020 (2,032,850) Securities loaned 182,110 180,714 Securities sold, not yet purchased, at fair value 3,248,131 (104,500) Payables:

Brokers, dealers and clearing organizations 645,901 (650,859) Customers (27,736) (653,667) Accrued expenses and other liabilities (30,990) (19,518)

Net cash provided by/(used in) operating activities 100,642 (359,567)


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CONSOLIDATED STATEMENTS OF CASH FLOWS, continued(Unaudited)


Three months endedJune 30,

2011 2010 CASH FLOWS FROM INVESTING ACTIVITIES: Acquisitions (694) (848) Proceeds from sale of memberships in exchanges 2,112 — Purchase of furniture, equipment and leasehold improvements (21,094) (10,354) Dividend received from membership exchange shares 388 —

Net cash used in investing activities (19,288) (11,202)

CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from other short-term borrowings 8,127 3,987 Issuance of common stock — 184,000 Proceeds from liquidity facility borrowings 50,000 — Repayment of liquidity facility borrowings (75,000) — Payment of debt issuance costs (1,271) (6,818) Payment of common stock issuance costs — (9,200) Payment of dividends on preferred stock (5,005) (7,678)

Net cash (used in)/provided by financing activities (23,149) 164,291

Effect of exchange rates on cash and cash equivalents 1,780 (2,122)

Increase/(decrease) in cash and cash equivalents 59,985 (208,600) Cash and cash equivalents at beginning of year 649,394 826,227

Cash and cash equivalents at end of period $ 709,379 $ 617,627

SUPPLEMENTAL NON-CASH FLOW INFORMATION Securities received as collateral 6,030 (2,622) Obligation to return securities received as collateral (6,030) 2,622


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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY(Unaudited)


CommonStock

Additionalpaid-incapital

AccumulatedOther

ComprehensiveIncome

AccumulatedDeficit

Noncontrollinginterest in

subsidiaries

Total

Equity Equity at March 31, 2011 $ 163,596 $ 1,597,183 $ 3,899 $ (409,639) $ 18,692 $ 1,373,731

Stock-based compensation 10,053 10,053 Net income applicable to MF Global Holdings Ltd. 13,309 13,309 Net income attributable to noncontrolling interest 251 251 Foreign currency translation 2,717 30 2,747 Stock issued in connection with employee stock award plans 1,297 (6,803) (5,506) Dividend distributions (5,005) (5,005)

Equity at June 30, 2011 $ 164,893 $ 1,595,428 $ 6,616 $ (396,330) $ 18,973 $ 1,389,580


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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(Unaudited)



2011 2010 Net income $ 13,560 $ 9,064

Foreign currency translation adjustment 2,747 (3,227)

Comprehensive income $ 16,307 $ 5,837 Comprehensive income/(loss) attributable to noncontrolling interest 281 (254)

Comprehensive income attributable to MF Global Holdings Ltd. $ 16,026 $ 6,091


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)


Note 1: Organization and Basis of Presentation

MF Global Holdings Ltd. (together with its subsidiaries, the "Company") is one of the world's leading brokers in markets for commodities and listedderivatives. The Company provides access to more than 70 exchanges globally and is a leader by volume on many of the world's largest derivativesexchanges. The Company is an active broker-dealer in markets for fixed income securities, equities, and foreign exchange. The Company is one of 20 primarydealers authorized to trade U.S. government securities with the Federal Reserve Bank of New York. In addition to executing client transactions, the Companyprovides research and market commentary to help clients make trading decisions as well as clearing and settlement services. The Company is also active inproviding client financing and securities lending services.

The Company is headquartered in the United States ("U.S."), and has operations globally, including the United Kingdom ("U.K."), Australia,Singapore, India, Canada, Hong Kong and Japan. The Company's diversified global client base includes a wide range of institutional asset managers andhedge funds, professional traders, corporations, sovereign entities, and financial institutions. The Company also offers a range of services for individualtraders and introducing brokers. As of June 30, 2011, the Company operates and manages its business as a single operating segment.

The Company's principal subsidiaries operate as registered futures commission merchants and as broker-dealers or the local equivalent and maintainfutures, options, and securities accounts for customers. The Company's subsidiaries are members of various commodities, futures, and securities exchanges inNorth America, Europe, and the Asia Pacific region and accordingly are subject to local regulatory requirements including those of the U.S. CommodityFutures Trading Commission ("CFTC"), the U.S. Securities and Exchange Commission ("SEC"), and the U.K. Financial Services Authority ("FSA"), amongothers.

The unaudited consolidated financial statements are prepared in conformity with U.S. generally accepted accounting principles ("U.S. GAAP") andinclude the consolidated accounts of MF Global Holdings Ltd. and its subsidiaries. All material intercompany balances and transactions between theCompany's entities have been eliminated in consolidation.

Note 2: Summary of Significant Accounting Policies

Use of estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions thataffect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, andthe reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. The nature of the Company'sbusiness is such that the results of any interim period may not be indicative of the results to be expected for a full year.

Consolidation

The Company's policy is to consolidate all entities of which it owns more than 50% unless it does not have control. Investments in entities in which theCompany generally owns greater than 20% but less than 50%, or exercises significant influence, but not control, are accounted for using the equity method ofaccounting. As of June 30 and March 31, 2011, the Company owned 70.2% of MF Global Sify Securities India Private Limited, 75.0% of MF Global Financeand Investment Services India Private Limited and 73.2% of MF Global Futures Trust Co. Ltd., and had a 19.5% equity investment in Polaris MF GlobalFutures Co., Ltd.

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During fiscal 2011, the Company launched the MF Global Multi-Strategy Futures Trust Fund (the "Fund") which is sponsored by one of the Company'saffiliates in Taiwan. While it has no direct investment in the Fund, the Company is responsible for selecting the commodity trading advisors to manage theFund and providing certain clearing and execution services. The Fund is structured under Taiwanese regulations as a futures trust fund, and due to thisstructure, the Company has consolidated the Fund under the accounting guidance for consolidation. At June 30 and March 31, 2011, the Fund's total assets of$37,255 and $38,493, respectively, were included in Other assets and the Fund's total liabilities and equity of $37,255 and $38,493, respectively, wereincluded in Accrued expenses and other liabilities within the Company's consolidated balance sheet.

Restricted cash and securities segregated under federal and other regulations

Certain subsidiaries are obligated by rules mandated by their primary regulators, including the SEC and CFTC in the U.S. and the FSA in the U.K., tosegregate or set aside cash or qualified securities to satisfy regulations, promulgated to protect customer assets. Also included within Restricted cash andsegregated securities are term cash deposits of $50,397 and $56,067 as of June 30 and March 31, 2011, respectively, which are held as margin for the issuanceof bank guarantees to satisfy local exchange requirements for day-to-day clearing. In addition, many of the subsidiaries are members of clearing organizationsat which cash or securities are deposited as required to conduct day-to-day clearance activities. At June 30 and March 31, 2011, the Company was incompliance with its segregation requirements.

Collateral

The Company enters into collateralized financing transactions and matched book positions principally through the use of repurchase agreements andsecurities lending agreements. In these transactions, the Company receives cash or securities in exchange for other securities, including U.S. and Europeangovernments, government sponsored entity and federal agency obligations, corporate debt and other debt obligations, and equities. The Company recordsassets it has pledged as collateral in collateralized borrowings and other arrangements on the consolidated balance sheets when the Company is the creditor asdefined in accordance with the accounting standard for transfers and servicing of financial assets.

The Company obtains securities as collateral principally through the use of resale agreements, securities borrowing agreements, customer margin loansand other collateralized financing activities to facilitate its matched book arrangements, inventory positions, customer needs and settlement requirements. Inmany cases, the Company is permitted to sell or repledge securities held as collateral. These securities may be used to collateralize repurchase agreements, toenter into securities lending agreements or to cover short positions. As of June 30 and March 31, 2011, the fair value of securities received as collateral by theCompany, excluding collateral received under resale agreements, that it was permitted to sell or repledge was $12,044,793 and $9,932,017, respectively. TheCompany sold or repledged securities aggregating $13,385,394 and $13,090,024, respectively. Counterparties have the right to sell or repledge thesesecurities. See Note 3 for a description of the collateral received and pledged in connection with agreements to resell or repurchase securities.

Equity

The Company has 1,000,000,000 shares authorized at $1.00 par value per share ("Common Stock"). At June 30 and March 31, 2011, the Company had164,892,596 and 163,595,695 shares of Common Stock issued and outstanding, respectively. At June 30 and March 31, 2011, noncontrolling interests were$18,973 and $18,692, respectively.

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Restructuring

The Company records a liability for costs associated with an exit or disposal activity, as measured initially at its fair value, in the period in which theliability is incurred. In the first quarter of fiscal 2011, the Company completed a strategic assessment of its cost base, including reviews of its compensationstructure and non-compensation expenses, and as a result of this evaluation, reduced its workforce. During the three months ended June 30, 2010, theCompany recorded an expense of $9,874, as a result of the restructuring plan, which included $9,180 for severance and other employee compensation costsand $694 in contract termination costs related to office closures.

Additionally, in the fourth quarter of fiscal 2011, senior management introduced a new strategic plan that would restructure the Company into four linesof business. To help transition to the new business model, the Company began realigning resources and further reduced its workforce. The workforcereductions occurred mainly in North America and Europe. During the three months ended June 30, 2011, the Company recorded an additional expense of$2,140, as a result of this restructuring plan, which included $1,946 for severance and other employee compensation costs and $194 in contract terminationcosts related to office closures. During the three months ended June 30, 2011, the Company made payments of $4,663 and had a remaining accrual of $344substantially all of which will be paid out within one year.

Principal transactions

Principal transactions include revenues from both matched principal brokerage activities and proprietary transactions. Revenues and losses frommatched principal brokerage activities are recorded on a trade date basis. For these activities, executed on behalf of customers, commission is not separatelybilled to customers; instead a commission equivalent is included in the transaction price. The Company records in Principal transactions the gains or losses onrepurchase and resale agreements accounted for as sales and purchase transactions. The Company also records dividends earned and paid in structured equitytrading strategies in Principal transactions.

Profits and losses arising from various financial instruments entered into for the account and risk of the Company are recorded on a trade date basis.The Company does not separately amortize purchase premiums and discounts associated with proprietary transactions, as these are a component of therecorded fair value. Changes in the fair value of such securities are recorded as unrealized gains and losses within Principal transactions in the unauditedconsolidated statements of operations. Contractual interest income and expense on these transactions are accrued and reported in Interest income and Interestexpense in the unaudited consolidated statements of operations.

Recently issued accounting pronouncements

In June 2011, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2011-05, Comprehensive Income—Presentation of Comprehensive Income ("ASU No. 2011-05"). ASU No. 2011-05 will align U.S. GAAP guidance on presentation of comprehensive incomemore closely with the International Financial Reporting Standards ("IFRS"). However, other differences in reporting comprehensive income still remainbetween U.S. GAAP and IFRS. The Company will adopt ASU No. 2011-05 in the first quarter of fiscal 2013 and does not expect material changes to itsconsolidated financial statements.

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In May 2011, the FASB issued ASU No. 2011-04, Fair Value Measurement—Amendments to Achieve Common Fair Value Measurement andDisclosure Requirements in U.S. GAAP and IFRSs ("ASU No. 2011-04"). ASU No. 2011-04 generally represents clarifications to the current fair valuemeasurement standard under U.S. GAAP and hence many of its amendments are not intended to result in a change in the application of the requirements ofthe current standard. However, ASU No. 2011-04 does include some instances where a particular principle or requirement for measuring fair value ordisclosing information about fair value measurements has changed. The Company will adopt ASU No. 2011-04 in the fourth quarter of fiscal 2012. TheCompany is currently assessing the impact it will have on its consolidated financial statements.

In April 2011, the FASB issued ASU No. 2011-03, Transfers and Servicing—Reconsideration of Effective Control for Repurchase Agreements ("ASUNo. 2011-03"). ASU No. 2011-03 removes from the assessment of effective control the requirement that the transferor has the ability to repurchase or redeemthe financial asset that was transferred and the related collateral maintenance implementation guidance. The Company will adopt ASU No. 2011-03 in thefourth quarter of fiscal 2012 and does not expect a material impact on its consolidated financial statements upon adoption.

In January 2010, the FASB issued ASU No. 2010-06, Fair Value Measurements and Disclosures ("ASU No. 2010-06"). The guidance in ASUNo. 2010-06 provides amendments to ASC 820, Fair Value Measurements, which requires a reporting entity to disclose separately the amounts of significanttransfers in and out of Level 1 and Level 2 fair value measurements and describe the reasons for the transfers. In addition, with regards to Level 3 assets, ASUNo. 2010-06 now requires that a reporting entity should present separately information about purchases, sales, issuances and settlements on a gross basis inthe reconciliation for fair value measurements using significant unobservable inputs (Level 3). The Company adopted the new disclosures and clarifications ofexisting disclosures in the fourth quarter of fiscal 2010. The Company adopted the disclosures about purchases, sales, issuances, and settlements in the roll-forward of activity in Level 3 fair value measurements in the first quarter of fiscal 2012 with no material impact to its consolidated financial statements.

Note 3: Collateralized Financing Transactions

Transactions involving securities under agreements to resell ("resale agreements") or securities under agreements to repurchase ("repurchaseagreements") are treated as collateralized financing transactions or as purchases and sales of securities. Resale and repurchase agreements treated ascollateralized financing transactions are recorded at their contractual amounts plus accrued interest. The resulting interest income and expense for thesearrangements are generally included in Interest income and Interest expense in the unaudited consolidated statements of operations. It is the general policy ofthe Company to take possession of securities with a market value equal to or in excess of the principal amount loaned plus the accrued interest thereon inorder to collateralize resale agreements. Generally, resale transactions are collateralized with investment grade securities including U.S. Treasury and agencysecurities. Resale agreements are also collateralized with European sovereign debt, and mortgage backed securities. Securities borrowed are collateralizedwith U.S. Treasury and agency securities, mortgage backed securities, equities, and investment grade corporate bonds. The Company retains the right to re-pledge collateral received in collateralized financing transactions. Similarly, the Company is generally required to provide securities to counterparties tocollateralize repurchase agreements. The Company's agreements with counterparties generally contain contractual provisions allowing for additional collateralto be obtained, or excess collateral returned. The collateral is marked to market daily and the Company may require counterparties to deposit additionalcollateral or return collateral pledged, when deemed appropriate. The Company's credit counterparties in resale transactions are central clearers, banks andbroker-dealers.

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Certain of the Company's securities borrowed and securities loaned transactions are accounted for as collateralized financing transactions and arerecorded at the amount of cash collateral advanced or received. Securities borrowed transactions facilitate the settlement process and require the Company todeposit cash or other collateral with the lender. In securities loaned transactions, the Company receives cash or other collateral in an amount generally inexcess of the market value of the applicable securities loaned. The Company monitors the market value of securities borrowed or loaned on a daily basis, withadditional collateral obtained or refunded as necessary. Generally, securities borrowed are collateralized with U.S. Treasury and agency securities, mortgagebacked securities, equities, and investment grade corporate bonds. In securities borrowed transactions, credit counterparties are central clearers, banks, broker-dealers and can also include insurance companies and pension funds.

Credit risk can arise from collateralized financing transactions when the collateral value falls below the value of the receivables and counterparties failto provide additional collateral. As of June 30, 2011 and 2010, no provision has been recorded against resale agreements or securities borrowed transactions,as amounts were deemed collectible.

As of June 30, 2011, the market value of collateral received under resale agreements was $56,999,296, of which $516,646 was deposited as margin withclearing organizations. As of March 31, 2011, the market value of collateral received under resale agreements was $48,665,649, of which $256,288 wasdeposited as margin with clearing organizations. The collateral is valued daily and the Company may require counterparties to deposit additional collateral orreturn collateral pledged, as appropriate. As of June 30 and March 31, 2011, the market value of collateral pledged under repurchase agreements was$68,404,867 and $61,088,346, respectively. As of June 30 and March 31, 2011, there were no amounts at risk under repurchase agreements or resaleagreements that are accounted for as collateralized financing transactions with a counterparty greater than 10% of Equity.

Resale and repurchase transactions that are accounted for as collateralized financing transactions are presented on a net-by-counterparty basis when therequirements for balance sheet offsetting are satisfied. As of June 30 and March 31, 2011, the Company had securities purchased under agreements to resell of$12,057,793 and $9,499,768, respectively, which includes the impact of netting for resale agreements classified within segregated securities. Segregatedsecurities are presented on a gross basis on the consolidated balance sheets.

The Company also enters into certain resale and repurchase transactions that mature on the same date as the underlying collateral ("reverse repo-to-maturity" and "repo-to-maturity" transactions, respectively). These transactions are accounted for as sales and purchases and accordingly the Company de-recognizes the related assets and liabilities from the consolidated balance sheets, recognizes a gain or loss on the sale/purchase of the collateral assets, andrecords a forward repurchase or forward resale commitment at fair value, in accordance with the accounting standard for transfers and servicing. For thesespecific repurchase transactions that are accounted for as sales and are de-recognized from the consolidated balance sheets, the Company maintains theexposure to the risk of default of the issuer of the underlying collateral assets, such as U.S. government securities or European sovereign debt. The forwardrepurchase commitment represents the fair value of this exposure and is accounted for as a derivative. The value of the derivative is subject to mark to marketmovements which may cause volatility in the Company's financial results until maturity of the underlying collateral at which point these instruments will beredeemed at par. At June 30 and March 31, 2011, securities purchased under agreements to resell of $5,233,156 and $1,495,682, respectively, at contractvalue, were de-recognized, of which 94.2% and 72.0%, respectively, were collateralized with European sovereign debt, consisting of Italy, Spain, Belgium,Portugal and Ireland. At June 30 and March 31 2011, securities sold under agreements to repurchase of

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$16,548,450 and $14,520,341, respectively, at contract value, were de-recognized, of which 69.3% and 52.6%, respectively, were collateralized withEuropean sovereign debt, consisting of Italy, Spain, Belgium, Portugal and Ireland.

Certain of the Company's resale and repurchase agreements are carried at fair value as a result of the Company's fair value election. The Companyelects the fair value option for those resale and repurchase agreements that do not settle overnight or do not have an open settlement date, based on theoriginal maturity term stated in the contract, or that are not accounted for as purchase or sale agreements. The Company has elected the fair value option forthese instruments to more accurately reflect market and economic events in its earnings and to mitigate a potential imbalance in earnings caused by usingdifferent measurement attributes (i.e. fair value versus carrying value) for certain assets and liabilities. Changes in the fair value of these transactions arerecorded in Principal transactions in the consolidated statement of operations. The Company has not specifically elected the fair value option for certain resaleand repurchase agreements that are settled on an overnight or demand basis as these are carried at contract value, which approximates fair value. At June 30,2011, the fair value of these resale and repurchase agreements was $11,974,402 and $8,667,980, respectively. At March 31, 2011, the fair value of these resaleand repurchase agreements was $11,898,502 and $7,232,434, respectively. Changes in the fair value of these transactions are recorded in Principaltransactions in the consolidated statement of operations. During the three months ended June 30, 2011, the amount of losses and gains related to resale andrepurchase agreements were ($2,335) and $3,099, respectively. During the three months ended June 30, 2010, the amount of gains and losses related to resaleand repurchase agreements were $4,854 and ($1,902), respectively.

The Company elects to record at fair value securities borrowed and securities loaned transactions that have a specific termination date beyond thebusiness day following the trade date. Changes in the fair value of these transactions are recorded in Principal transactions in the consolidated statement ofoperations. At June 30 and March 31, 2011, no securities borrowed agreements were carried at fair value. At June 30 and March 31, 2011, the fair value ofsecurities loaned agreements were $777 and $0, respectively. Changes in the fair value of these transactions are recorded in Principal transactions in theconsolidated statement of operations. During the three months ended June 30, 2011 and 2010, the net amount of losses related to securities borrowedagreements carried at fair value was $27 and $2, respectively. For transactions not elected for fair value measurement, the amount of cash collateral advancedor received is recorded on the consolidated balance sheets. There are no securities borrowed or securities loaned transactions accounted for as sales.

The carrying values of the securities sold under repurchase transactions, including accrued interest, by maturity date are: June 30, 2011

Demand Overnight

Less than 30days 30 to 90 days

After 90days Total

Security type U.S. Government $ 1,071,037 6,923,253 554,940 581,050 771,355 $ 9,901,635 U.S. Corporations 742,020 205,326 1,066,456 100,048 163,974 2,277,824 Foreign Governments 508,317 1,152,991 1,503,633 786,888 1,408,577 5,360,406 Foreign Corporations 771 — 285,118 77,243 65,871 429,003

Total $ 2,322,145 $ 8,281,570 $ 3,410,147 $ 1,545,229 $ 2,409,777 $ 17,968,868

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March 31, 2011

Demand Overnight

Less than30 days 30 to 90 days After 90 days Total

Security type U.S. Government $ 1,763,156 $ 6,559,566 $ 590,387 $ 79,344 $ 1,015,777 $ 10,008,230 U.S. Corporations 145,603 126,286 1,065,796 150,086 64,125 1,551,896 Foreign Governments 278,653 1,423,060 2,366,795 518,446 179,874 4,766,828 Foreign Corporations — 16,714 283,207 — — 299,921

Total $ 2,187,412 $ 8,125,626 $ 4,306,185 $ 747,876 $ 1,259,776 $ 16,626,875

Note 4: Securities Owned and Securities Sold, Not Yet Purchased and Segregated Securities

Securities Owned and Securities Sold, Not Yet Purchased

Stocks, government and corporate bonds, futures, options and foreign currency transactions are reported in the unaudited consolidated financialstatements on a trade date basis. Securities owned and securities sold, not yet purchased are stated at fair value, unless designated as held-to-maturity.Realized and unrealized gains and losses are reflected in Principal transactions or Gains on exchange seats and shares in the unaudited consolidated statementsof operations. Fair values are generally based on quoted market prices. Securities sold, not yet purchased, represent obligations of the Company to deliver thespecified security and, thereby, create a liability to purchase the security in the market at prevailing prices. The Company's liability for securities to bedelivered is measured at their fair value as of the date of the unaudited consolidated financial statements. These transactions result in off-balance sheet risk, asthe Company's ultimate cost to satisfy the delivery of the Securities sold, not yet purchased, may exceed the amount reflected on the consolidated balancesheets. Shares in exchanges held by the Company that are not required for trading rights are recorded at fair market value, taking into account any restrictions.Unrealized gains and losses arising from these assets are reported separately in the unaudited consolidated statements of operations as Gains on exchangeseats and shares.

Securities owned and securities sold, not yet purchased include securities carried at fair value as well as certain marketable securities classified as held-to-maturity securities. As of June 30, 2011, securities owned of $11,573,484 consisted of $7,334,596 held at fair value and $4,238,888 held at amortized cost.As of March 31, 2011, securities owned of $10,831,346 consisted of $6,571,646 held at fair value and $4,259,700 held at amortized cost.

Securities owned and securities sold, not yet purchased, which are held at fair value, consist of the following: June 30, 2011 March 31, 2011

SecuritiesOwned

SecuritiesSold, Not

YetPurchased

SecuritiesOwned

SecuritiesSold, Not

YetPurchased

U.S. government securities and federal agency obligations $ 4,163,471 $ 4,614,914 $ 4,457,016 $ 4,332,590 Corporate debt securities 1,631,909 320,621 567,873 257,294 Foreign government bonds 500,281 160,451 716,460 68,355 Equities 849,610 3,047,466 722,903 306,926 Options 155,734 150,250 89,582 87,321 Shares held due to demutualization of exchanges 18,359 — 16,928 — Other 15,232 6,915 884 —

Total $ 7,334,596 $ 8,300,617 $ 6,571,646 $ 5,052,486

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As of June 30 and March 31, 2011, $12,997 and $0, respectively, of U.S. government securities and federal agency obligations owned by the Companywere deposited as margin with clearing organizations.

Held-to-Maturity Securities

Held-to-maturity securities primarily consist of U.S. government treasury securities, agency debentures and corporate obligations. The Companyaccounts for held-to-maturity securities under the accounting standard for investments in debt securities and classifies securities as held-to-maturity that areowned by its non broker-dealer parent and subsidiaries, where it has the positive intent and the ability to hold the securities until maturity. These securities arecarried on an amortized cost basis on the consolidated balance sheet in Securities owned or Restricted cash and segregated securities. The Companydesignates these securities as held-to-maturity at the time of purchase and re-evaluates the designation at each balance sheet date. Held-to-maturity securitiesare reviewed at least quarterly for impairment.

Of the $6,393,287 total held-to-maturity portfolio, $1,243,015 will mature within one year, $2,016,651 will mature in one to three years and $3,133,621will mature in three to five years. During the three months ended June 30, 2011 and 2010, the Company recognized other-than-temporary impairment of $136and $621, respectively, related to debt securities issued by the U.S. government and federal agencies as these were purchased at a premium and the securitieswere called prior to maturity. The Company will not recover the amortized cost of these particular securities prior to their known call date.

The following table summarizes the carrying value, fair value and unrealized gains and losses, for the held-to-maturity securities, none of which havebeen in an unrealized loss position greater than 12 months, at June 30 and March 31, 2011: June 30, 2011

Securities Owned

AmortizedCost Fair Value

GrossUnrealized

Gain

GrossUnrealized

Loss Corporate debt securities $ 1,559,106 $ 1,562,502 $ 6,058 $ (2,662) U.S. government securities and federal agency obligations 2,679,782 2,669,539 413 (10,656)

Total $ 4,238,888 $ 4,232,041 $ 6,471 $ (13,318)

June 30, 2011

Segregated Securities


GrossUnrealized

Gain

GrossUnrealized

Loss Corporate debt securities $ 1,319,945 $ 1,321,134 $ 1,666 $ (477) U.S. government securities and federal agency obligations 834,454 841,649 7,272 (77)

Total $ 2,154,399 $ 2,162,783 $ 8,938 $ (554)

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March 31, 2011

Securities Owned


GrossUnrealized

Gain

GrossUnrealized

Loss Corporate debt securities $ 1,144,790 $ 1,151,531 $ 6,900 $ (159) U.S. government securities and federal agency obligations 3,114,910 3,055,812 144 (59,242)

Total $ 4,259,700 $ 4,207,343 $ 7,044 $ (59,401)

March 31, 2011



GrossUnrealized

Gain

GrossUnrealized

Loss Corporate debt securities $ 790,029 $ 789,153 $ 1,428 $ (2,304) U.S. government securities and federal agency obligations 1,838,251 1,836,469 1,093 (2,875)

Total $ 2,628,280 $ 2,625,622 $ 2,521 $ (5,179)


At June 30 and March 31, 2011, the Company had segregated securities of $7,639,612 and $8,929,537, respectively, within Restricted cash andsegregated securities. These amounts include securities purchased under agreements to resell that are subject to the segregation requirements of the CFTC andtotaled $4,996,422 and $5,982,860 at June 30 and March 31, 2011, respectively, of which $354,903 and $1,408,210 are at fair value as a result of theCompany's fair value election, at June 30 and March 31, 2011, respectively.

Note 5: Fair Value Measurements and Derivative Activity

Fair Value

The Company carries a significant portion of its assets and liabilities at fair value. These assets and liabilities consist of financial instruments, includingcash and derivative products, and primarily represent its investment, trading, financing and customer facilitation activities. Financial instruments are recordedin the financial statements on a trade-date basis and they include related accrued interest or dividends. Changes in the fair value of financial instruments arerecognized in earnings within Principal transactions in the unaudited consolidated statements of operations.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between marketparticipants at the measurement date, or an "exit" price. The Company marks its financial instruments based on available quoted market prices, whereapplicable, and based on market convention, the Company marks its financial instruments based on product class which is generally bid or mid price. If listedprices or quotes are not available, the Company determines fair value based on comparable market transactions, executable broker quotes, or independentpricing sources with reasonable levels of price transparency. Fair value measurements are not adjusted for transaction costs.

Credit risk is a component of fair value and represents the loss the Company would incur if a counterparty or an issuer of securities or otherinstruments, the Company holds, fails to perform under its contractual obligations to the Company, or upon a deterioration in the credit quality of third partieswhose securities or other

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instruments, including OTC derivatives, the Company holds. To reduce the Company's credit exposures in its operating activities, the Company generallyenters into agreements with its counterparties that permit it to offset receivables and payables with such counterparties and obtain margin and/or collateralfrom the counterparty on an upfront and ongoing basis. The Company monitors and manages its credit exposures daily. The Company considers the impact ofcounterparty credit risk in the valuation of its assets and its own credit risk in the valuation of its liabilities that are presented at fair value.

The Company has a framework for measuring fair value, and a fair value hierarchy based on the quality of inputs used to measure fair value andenhances disclosure requirements for fair value measurements. The Company utilizes valuation techniques that maximize the use of observable inputs andminimize the use of unobservable inputs. The Company has applied this framework to all financial instruments that are required to be reported at fair value.

In this framework, financial instruments are categorized into a three-level valuation hierarchy for disclosure of fair value measurements. The hierarchygives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority tounobservable inputs (Level 3 measurements). A market is active if there are sufficient transactions on an ongoing basis to provide current pricing informationfor the asset or liability, pricing information is released publicly, and price quotations do not vary substantially either over time or among market makers.Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sourcesindependent of the reporting entity. The fair value hierarchy is based on the observability of inputs in the valuation of an asset or liability at the measurementdate. In determining the appropriate fair value hierarchy levels, the Company performs a detailed analysis of its assets and liabilities. At each reporting period,all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The three levels aredescribed as follows:

Level 1—Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 1consists of financial instruments whose fair values are determined using quoted market prices.

Level 2—Quoted prices for identical or similar assets or liabilities in markets that are less active, that is, markets in which there are few transactions forthe asset or liability that are observable for substantially the full term. Included in Level 2 are those financial instruments for which fair values areestimated using models or other valuation methodologies. These models are primarily industry-standard models utilizing various observable inputs,including time value, yield curve, volatility factors, observable current market and contractual prices for the underlying financial instruments, as well asother relevant economic measures.

Level 3—Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported bylittle or no observable market quotes). Level 3 is comprised of financial instruments whose fair value is estimated using internally developed models ormethodologies utilizing significant inputs that are not readily observable from objective sources.

Securities owned, Securities sold, not yet purchased, certain Securities purchased under agreements to resell, certain Securities Sold under agreementsto repurchase, certain Securities loaned and derivative transactions are carried at fair value. The following is a description of the valuation techniques theCompany applies to the major categories of assets and liabilities that are measured at fair value on a recurring basis.

• U.S. Treasury securities are marked from composites of end-of-day quoted prices. Accordingly, these securities are generally categorized inLevel 1 of the fair value hierarchy.

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• The fair value of foreign government obligations is determined using quoted market prices or executable broker or dealer quotes, whereobservable. These securities are marked at mid-market prices based on a composite of observable bids and offers and are generally categorized inLevel 1 of the fair value hierarchy.

• Equities include mostly exchange-traded corporate equity securities and are valued based on quoted market prices. Accordingly, these securitiesare categorized in Level 1 of the fair value hierarchy.

• Exchange-traded or listed derivative contracts, the Company carries are actively traded and valued based on the exchange settled prices.Accordingly, they are categorized in Level 1 of the fair value hierarchy.

• U.S. Agency debentures are generally valued based on the composites of end-of-day trade prices or executable broker or dealer quotes, ifapplicable. Otherwise, they are priced from independent pricing sources. U.S. agency debentures are generally categorized in Level 2 of the fairvalue hierarchy.

• Mortgage-backed securities primarily consist of U.S. government mortgage pass-throughs, liquid private-label residential mortgage-backedsecurities and collateralized mortgage obligations. They are generally priced from independent pricing sources and categorized in Level 2 of thefair value hierarchy.

• Corporate debt securities consist primarily of U.S. corporate bonds. The fair value of corporate bonds is estimated using recently executedtransactions or market quoted prices, where observable. Independent pricing sources are also used for valuation. Corporate bonds are generallycategorized in Level 2 of the fair value hierarchy.

• Most of the Company's OTC derivative contracts are traded in liquid markets and include forward, swap and option contracts related tocommodity prices, equity prices, foreign currencies and interest rates. The Company values these contracts based on pricing models whichrequire a variety of pricing inputs. The pricing models used by the Company are industry-standard models for the types of derivative contractsand model selection does not require significant judgment. Pricing inputs are normally observable and they include contractual terms, marketprices, yield curves, credit curves and volatility measures. Accordingly, these OTC derivative contracts are categorized in Level 2 of the fairvalue hierarchy.

• Certain resale and repurchase agreements and securities borrowed and loaned are carried at fair value under the fair value option. Thesetransactions are generally valued based on inputs with reasonable price transparency and are therefore generally categorized in Level 2 of the fairvalue hierarchy.

• Shares held due to demutualization of exchanges are priced based on the latest market data available, typically the most recent bids ortransactions completed. In certain cases, shares held due to demutualization of exchanges are valued based on quoted market prices and thesesecurities are categorized as Level 1, while others are priced using models with inputs that are observable at valuation. When model input pricesare observable these securities are categorized as Level 2. Where there is limited trading activity for these instruments, these securities arecategorized as Level 3 of the fair value hierarchy.

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The following tables summarize the Company's financial assets and liabilities as of June 30 and March 31, 2011, by level within the fair valuehierarchy.

Level 1 Level 2 Level 3

Impact ofNetting andCollateral

(1)

Total as ofJune 30, 2011

Assets Securities owned

U.S. government securities and federal agency obligations $ 2,425,922 $ 510,884 $ — $ — $ 2,936,806 U.S. government mortgage backed securities — 1,610,070 — — 1,610,070 Private label mortgage backed securities — 10,137 — — 10,137 Corporate debt securities — 1,636,463 — — 1,636,463 Foreign government bonds 590,977 — — — 590,977 Equities 849,610 — — — 849,610 Options 155,734 — — — 155,734 Shares held due to demutualization of exchanges 3,499 — 14,860 — 18,359 Other 885 14,347 — — 15,232

Total securities owned (4)

$ 4,026,627 $ 3,781,901 $ 14,860 $ — $ 7,823,388

Derivative Assets Futures transactions $ 2,591,228 $ — $ — $ (1,051,574) $ 1,539,654 Foreign currency and other derivative transactions 146,500 720,897 — (828,402) 38,995

Total derivative assets (2)

2,737,728 720,897 — (1,879,976) 1,578,649

Securities purchased under agreements to resell (5) (6) — 21,790,541 — (9,461,235) 12,329,306

Total assets at fair value $ 6,764,355 $ 26,293,339 $ 14,860 $ (11,341,211) $ 21,731,343

Liabilities Securities sold, not yet purchased

U.S. government securities and federal agency obligations $ 2,714,863 $ 345,063 $ — $ — $ 3,059,926 U.S. government mortgage backed securities — 1,554,988 — — 1,554,988 Corporate debt securities — 320,621 — — 320,621 Foreign government bonds 160,451 — — — 160,451 Equities 3,047,466 — — — 3,047,466 Options 150,250 — — — 150,250 Other — 6,915 6,915

Total securities sold, not yet purchased $ 6,073,030 $ 2,227,587 $ — $ — $ 8,300,617

Derivative liabilities Futures transactions $ 2,596,616 $ — $ — $ 1,055,404 $ 3,652,020 Foreign currency and other derivative transactions 190,421 687,667 — (167,405) 710,683

Total derivative liabilities (3)

2,787,037 687,667 — 887,999 4,362,703

Securities loaned (5)

— 777 — — 777 Securities sold under agreements to repurchase

(5) — 18,129,214 — (9,461,234) 8,667,980

Total liabilities at fair value $ 8,860,067 $ 21,045,245 $ — $ (8,573,235) $ 21,332,077

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(Dollars in thousands, except per share and share amounts) (1) Represents cash collateral and the impact of netting across the levels of the fair value hierarchy. Netting among positions classified within the same

level is included in that level.(2) Reflects derivative assets within Receivables from customers and Receivables from brokers, dealers and clearing organizations. Excludes $3,370,126

within Receivables from customers and Receivables from brokers, dealers and clearing organizations which are accounted for at other than fair value.Excludes $170,080 which is recorded in Securities owned.

(3) Reflects derivative liabilities within Payables to customers and Payables to brokers, dealers and clearing organizations. Excludes $10,984,026 withinPayables to customers and Payables to brokers, dealers and clearing organizations which are accounted for at other than fair value. Excludes $157,164which is recorded in Securities sold, not yet purchased.

(4) Includes $488,792 of Securities owned which are held in segregation. These securities have been classified within Restricted cash and segregatedsecurities in the consolidated balance sheet.

(5) Excludes Securities purchased under agreements to resell, Securities sold under agreements to repurchase, and Securities loaned which are held atcontract value.

(6) Includes $354,904 of Securities purchased under agreements to resell which are held in segregation. These securities have been classified withinRestricted cash and segregated securities.

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Level 1 Level 2 Level 3

Impact ofNetting andCollateral

(1)

Total as ofMarch 31,

2011 Assets Securities owned

U.S. government securities and federal agency obligations $ 3,337,477 $ 393,828 — — $ 3,731,305 U.S. government mortgage backed securities — 1,003,628 — — 1,003,628 Private label mortgage backed securities — 10,411 — — 10,411 Corporate debt securities — 572,034 — — 572,034 Foreign government bonds 716,460 — — — 716,460 Equities 722,903 — — — 722,903 Options 89,582 — — 89,582 Shares held due to demutualization of exchanges — 1,079 15,849 — 16,928 Other — 884 — — 884

Total securities owned (4)

$ 4,866,422 $ 1,981,864 $ 15,849 $ — $ 6,864,135

Derivative Assets Futures transactions $ 3,282,442 $ — $ — $ (2,300,966) $ 981,476 Foreign currency and other OTC derivative transactions 51,281 839,798 — (842,434) 48,645

Total derivative assets (2)

3,333,723 839,798 — (3,143,400) 1,030,121

Securities purchased under agreements to resell (5) (6) — 24,131,026 (10,824,314) 13,306,712

Total assets at fair value $ 8,200,145 $ 26,952,688 $ 15,849 $ (13,967,714) $ 21,200,968

Liabilities U.S. government securities and federal agency obligations $ 3,297,000 $ 74,275 $ — $ — $ 3,371,275 U.S. government mortgage backed securities — 961,315 — — 961,315 Corporate debt securities — 257,294 — — 257,294 Foreign government bonds 68,355 — — — 68,355 Equities 306,926 — — — 306,926 Options 87,321 — — — 87,321

Total securities sold, not yet purchased $ 3,759,602 $ 1,292,884 $ — $ — $ 5,052,486

Derivative liabilities Futures transactions $ 3,256,488 $ — $ — $ 408,803 $ 3,665,291 Foreign currency and other OTC derivative transactions 51,678 796,853 — (128,101) 720,430

Total derivative liabilities (3)

3,308,166 796,853 — 280,702 4,385,721

Securities sold under agreements to repurchase (5)

— 18,056,749 — (10,824,314) 7,232,435

Total liabilities at fair value $ 7,067,768 $ 20,146,486 $ — $ (10,543,612) $ 16,670,642

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(Dollars in thousands, except per share and share amounts) (1) Represents cash collateral and the impact of netting across the levels of the fair value hierarchy. Netting among positions classified within the same

level is included in that level.(2) Reflects derivative assets within Receivables from customers and Receivables from brokers, dealers and clearing organizations. Excludes $3,592,560

within Receivables from customers and Receivables from brokers, dealers and clearing organizations which are accounted for at other than fair value.Excludes $90,465 which is recorded in Securities owned.

(3) Reflects derivative liabilities within Payables to customers and Payables to brokers, dealers and clearing organizations. Excludes $10,325,111 withinPayables to customers and Payables to brokers, dealers and clearing organizations which are accounted for at other than fair value. Excludes $87,321which is recorded in Securities sold, not yet purchased.

(4) Includes $292,489 of Securities owned which are held in segregation. These securities have been classified within Restricted cash and segregatedsecurities in the consolidated balance sheet.

(5) Excludes Securities purchased under agreements to resell and Securities sold under agreements to repurchase, which are held at contract value.(6) Includes $1,408,210 of Securities purchased under agreements to resell which are held in segregation. These securities have been classified within

Restricted cash and segregated securities.

Changes in unrealized gains and losses relating to assets or liabilities, measured at fair value, still held at the end of the period are reported in Principaltransactions revenues in the unaudited consolidated statements of operations. The risks or volatility associated with the transactions that make up this amountare often offset or reduced by certain hedging strategies associated with products within a different level in the fair value hierarchy (either Level 1 or Level 2).The Company often enters into positions with one counterparty which are generally offset with opposite transactions with other counterparties. These hedgingtransactions and the associated underlying financial instruments are often classified in different levels in the fair value hierarchy.

For the three months ended June 30, 2011, the Company did not have significant transfers in or out of Level 1 and Level 2 in the fair value hierarchy.

The table below provides a reconciliation of the beginning and ending balances for the major classes of assets and liabilities measured at fair valueusing significant unobservable inputs (Level 3). The table reflects gains and losses during the periods for all financial assets and liabilities categorized asLevel 3 as of the three months ended June 30, 2011 and 2010. The net unrealized losses reflected in Level 3 should be considered in the context of the factorsdiscussed below.

• A derivative contract with Level 1 and/or Level 2 inputs is classified as a Level 3 financial instrument in its entirety if it has at least onesignificant Level 3 input.

• If there is one significant Level 3 input, the entire gain or loss from adjusting only observable inputs (i.e., Level 1 and Level 2) is still classifiedas Level 3.

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)

Three months ended

June 30,

2011 2010 Beginning balance $ 15,849 $ 14,034

Total unrealized gain 10 3,825 Total unrealized loss — (852) Transfers out of Level 3 (1,206) — Foreign currency translation 207 (6)

Balance, end of period $ 14,860 $ 17,001

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The balance at June 30, 2011 and 2010 respectively is comprised of shares held due to the demutualization of exchanges. At June 30, 2010, the balancealso included an investment classified within Other Assets. Total realized and unrealized gains or losses represent the total gains and losses recorded for theLevel 3 assets and liabilities and are reported in Gains on exchange seats and shares and in Other revenues in the unaudited consolidated statements ofoperations. Changes in the fair value hierarchy for a specific financial asset or financial liability may result in transfers in the hierarchy level. The transferfrom Level 3 to Level 1 during the three months ended June 30, 2011 represents shares held due to demutualization of exchanges that can be valued usingquoted market prices.

The fair value of long-term borrowings at June 30 and March 31, 2011 was $491,927 and $508,943, respectively. The fair value of long-term debt wasdetermined by reference to the June 30, 2011 quoted market prices.

Derivative Activity

The Company provides trade execution and clearing services for exchange-traded and OTC derivative products. In connection with these tradingservices, the Company may use derivative instruments to facilitate client transactions or to build inventory for future client demand. The Company also entersinto derivative transactions for its own account to offset the Company's exposure to counterparty transactions, changes in foreign currency and interest raterisks, and to manage its liquid corporate assets, as well as to monetize its views on the market. In accordance with the accounting standard for derivatives andhedging, the Company currently does not apply hedge accounting to its derivative activities.

The Company recognizes all of its derivative contracts as either assets or liabilities on the consolidated balance sheets at fair value, which are reflectednet of cash paid or received pursuant to credit support arrangements with counterparties and reported on a net-by-counterparty basis under legally enforceablenetting agreements. These derivative assets and liabilities are included in Receivables from and Payables to customers, Receivables from and Payables tobroker dealers and clearing organizations, Securities owned and Securities sold, not yet purchased. Changes in the fair value of all derivative instruments arerecognized in Principal transactions in the unaudited consolidated statements of operations.

The following table summarizes the fair value of the Company's derivative contracts by major type on a gross basis as of June 30 and March 31, 2011. June 30, 2011

Derivative

Assets (1)

Derivative

Liabilities (2)

Number of

Contracts

(3) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

(in thousands, except number of contracts) Derivative contracts

Interest rate $ 1,156 11,244 — 12,400 $ 1,306 9,393 — 10,699 22,267 Foreign exchange rate 64,666 371,784 — 436,450 56,297 362,398 — 418,695 2,759,883 Equity 190,553 111,577 — 302,130 258,430 106,580 — 365,010 1,174,765,618 Commodity 2,637,086 235,701 — 2,872,787 2,621,253 212,038 — 2,833,291 994,177 Other — 4,938 — 4,938 — 4,173 — 4,173 4,981

Total fair value of derivative contracts $ 3,628,705 $ 3,631,868 Impact of netting and collateral (1,879,976) 887,999

Total fair value $ 1,748,729 $ 4,519,867

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March 31, 2011

Derivative

Assets (1)

Derivative

Liabilities (2)

Number of

Contracts

(3) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

(in thousands, except number of contracts) Derivative contracts

Interest rate $ 4,043 16,271 — 20,314 $ 3,833 7,972 — 11,805 28,318 Foreign exchange rate 54,698 405,283 — 459,981 42,979 401,120 — 444,099 3,011,744 Equity 56,742 94,351 — 151,093 52,440 95,458 — 147,898 1,082,983,355 Commodity 3,307,822 323,804 — 3,631,626 3,296,234 291,061 — 3,587,295 871,357 Other — 972 — 972 — 1,243 — 1,243 1,411

Total fair value of derivative contracts $ 4,263,986 $ 4,192,340 Impact of netting and collateral (3,143,400) 280,702

Total fair value $ 1,120,586 $ 4,473,042

(1) Reflects derivative assets within Securities owned, Receivables from customers and Receivables from brokers, dealers and clearing organizations.

Excludes non-derivatives included in Securities owned and Receivables from customers and Receivables from brokers, dealers and clearingorganizations.

(2) Reflects derivative liabilities within Securities sold, not yet purchased, Payables to customers and Payables to brokers, dealers and clearing organizations.Excludes non-derivative Securities sold, not yet purchased and Payables to customers and Payables to brokers, dealers and clearing organizations whichare accounted for at other than fair value.

(3) Contract equivalent is determined using industry standards and equivalent contracts in the futures market. OTC contract equivalents are determined bydividing OTC notionals by associated contract notionals. For minor currencies for which no futures contracts are traded, contract equivalents aredetermined to be equal to the USD notional divided by $1,000, which is consistent with other minor currency futures contracts.

The Company's volumes of exchange traded futures and options executed and/or cleared, where the unrealized gain or loss is settled daily, and there isno receivable or payable associated with the contract, was 572,170,566 and 521,778,454 contracts for the three months ended June 30, 2011 and 2010,respectively. These contracts are primarily cleared through commodity clearing corporations.

The table below summarizes the gains or losses relating to the Company's trading activities as reported in Principal transactions in the unauditedconsolidated statements of operations for the three months ended June 30, 2011 and 2010.

Three Months Ended

June 30,

Type of Instrument 2011 2010 Fixed income/Interest rate $ (446) $ (4,259) Foreign exchange 8,080 17,640 Equity 76,614 24,191 Commodity 22,682 27,185 Other 9,837 1,585

Total $ 116,767 $ 66,342

Certain of the Company's derivative trading agreements contain provisions requiring the Company to post collateral according to the Company's long-term credit ratings. These terms are pursuant to bilateral agreements

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with certain counterparties, and could require immediate payment or ongoing overnight collateralization on derivative instruments in net liability positions. Asof June 30, 2011, the aggregate fair value of derivative agreements with credit-risk-related contingent features that were in a net liability position was$16,845, for which the Company has posted collateral of $29,296 in accordance with arrangements. If the Company's long term credit rating had a one-notchor two-notch reduction as of June 30, 2011, the amount of additional collateral that could be called by counterparties for these derivative agreements would beapproximately $5,060 for either reduction.

As of March 31, 2011, the aggregate fair value of derivative agreements with credit-risk-related contingent features that were in a net liability positionwas $14,249, for which the Company has posted collateral of $29,483 in accordance with arrangements. If the Company's long term credit rating had a one-notch or two-notch reduction as of March 31, 2011, the amount of additional collateral that could be called by counterparties for these derivative agreementswould be approximately $845 or $1,221, respectively.

Note 6: Receivables from and Payables to Brokers, Dealers and Clearing Organizations

Receivables from brokers, dealers and clearing organizations include amounts receivable for securities not delivered by the Company to the purchaserby the settlement date ("fails to deliver") and margin deposits. Payables to brokers, dealers and clearing organizations include amounts payable for securitiesnot received by the Company from the seller by the settlement date ("fails to receive"). Receivables from and payables to brokers, dealers and clearingorganizations also include amounts related to net receivables and payables arising from unsettled regular-way trades. Receivables from and payables tobrokers, dealers and clearing organizations consist of the following: June 30, 2011 March 31, 2011

Receivables Payables Receivables Payables Securities failed to deliver/receive $ 1,034,144 $ 1,218,161 $ 291,580 $ 466,481 Due from/to clearing brokers 952,431 28,864 1,065,362 4,144 Due from/to clearing organizations 1,591,852 93,893 908,605 120,043 Fees and commissions 498 68,134 708 69,557 Unsettled trades 929,849 280,727 1,823,641 431,921 Other 120,691 89,842 143,241 41,489

Total $ 4,629,465 $ 1,779,621 $ 4,233,137 $ 1,133,635

Note 7: Receivables from and Payables to Customers

The balances of receivables from and payables to customers pertain primarily to margin and open contractual commitments related to customers'futures, foreign currency forwards and securities transactions. Receivables from and payables to customers include gains and losses on open futures, optionsand forward contracts and amounts due on cash and margin transactions.

Securities owned by customers are held as collateral for receivables by the Company, and customer securities transactions are recorded on a trade datebasis. Securities owned by customers, including those that collateralize margin or other similar transactions, are not reflected on the consolidated balancesheets. The Company generally nets receivables and payables related to its customers' futures, foreign currency forwards and

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securities transactions on a counterparty basis pursuant to master netting or customer agreements. It is the Company's policy to settle these transactions on anet basis with its counterparties. Receivables from customers, net of allowances, and payables to customers are as follows: June 30, 2011 March 31, 2011

Receivables Payables Receivables Payables Futures transactions $ 179,467 $ 12,476,101 $ 259,499 $ 12,283,617 Foreign currency and other OTC derivative transactions 19,864 653,195 26,163 691,585 Securities transactions 79,737 433,732 51,508 595,576 Other 40,242 4,080 52,374 6,419

Total $ 319,310 $ 13,567,108 $ 389,544 $ 13,577,197

Note 8: Furniture, Equipment, and Leasehold Improvements

Furniture and equipment are stated at cost, net of accumulated depreciation and are depreciated over their estimated useful lives of 3 to 5 years on astraight-line basis. Leasehold improvements are amortized on a straight-line basis over the lesser of the economic useful life of the improvement or the term ofthe related leases, which range from 2 to 10 years. The Company capitalizes the costs of software developed for internal use in accordance with ASC 350,Intangibles- Goodwill and Other. The software developed or obtained for internal use is amortized over its estimated useful life of 1 to 5 years on a straight-line basis.

The Company reviews the carrying value of its furniture, equipment, or leasehold improvements for impairment whenever events or changes incircumstances indicate that the carrying amounts may not be recoverable. There were no impairment charges for furniture, equipment, and leaseholdimprovements recorded during the three months ended June 30, 2011 and 2010. A summary of furniture, equipment, and leasehold improvements is asfollows:

June 30,2011

March 31,2011

Leasehold improvements $ 91,717 $ 84,118 Equipment 94,490 96,861 Furniture and fixtures 44,099 35,763 Computer software 84,432 77,224

Total cost 314,738 293,966 Less: Accumulated depreciation and amortization 163,002 155,573

Cost, net of accumulated depreciation and amortization $ 151,736 $ 138,393

Note 9: Goodwill and Intangible Assets

There were no acquisitions during the three months ended June 30, 2011 or 2010.

During the three months ended June 30, 2011 earn-out payments of $694 were made relating to a prior acquisition, which were accounted for asadditional purchase consideration. As of June 30, 2011, the Company had one remaining arrangement that could result in contingent, or "earn-out", payments.These payments are based on earnings in future years, subject to maximum and minimum amounts. If the minimum earn-out is not reached at the end of 5years (to fiscal 2012), the Company's obligation to pay the earn-out can extend for up to 10 years (to fiscal 2017), subject to a remaining maximum ofapproximately $65,000.

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Goodwill represents the excess of the purchase price of a business combination over the fair value of the net assets acquired. Goodwill is not amortizedand is tested at least annually for impairment or when there is an interim triggering event. An assessment of goodwill for potential impairment is performed intwo steps. Step 1 of the analysis is used to identify the impairment and involves determining and comparing the fair value of the Company (as one reportingunit) with its carrying value, or equity. If the fair value of the Company does not exceed its carrying value, goodwill is considered impaired. Step 2 of theanalysis compares the fair value of the Company to the aggregated fair values of its individual assets, liabilities and identified intangibles, to calculate theamount of impairment, if any.

In performing Step 1 of the analysis, the Company compared its net book value to its estimated fair value. In determining the estimated fair value, theCompany performed a discounted cash flow analysis using management's current business plans, which factored in current market conditions includingcontract and product volumes and pricing as the basis for expected future cash flows for the first five years and a 1% growth rate for the cash flows thereafter.Management used a weighted average cost of capital ("WACC") of 10.81% as its discount rate in this analysis. The WACC was derived from marketparticipant data and estimates of the fair value and yield of the Company's debt, preferred stock, and equity as of the testing date. The WACC represents theyield of the Company's financial instruments as currently stated. A discounted cash flow model involves the subjective selection and interpretation of datainputs and, given market conditions at June 30, 2011, there was a limited amount of observable market data inputs available when determining the model.

Based on the results of Step 1 of the analysis, the Company determined its goodwill was impaired, as the fair value derived from the discounted cashflow model was less than the Company's book value at June 30, 2011. Then, based on the results of Step 2 of the analysis, the Company determined that itsmarket capitalization and the computed fair value from Step 1 of the analysis was less than the estimated fair value of the Company's balance sheet andtherefore recorded a charge of $694 in the three months ended June 30, 2011 to write-off the entire amount of the Company's goodwill. As discussed, theCompany has an earn-out arrangement that could result in additional goodwill being recorded in future periods. The Company will continue to assess itsgoodwill annually or whenever events or changes in circumstances indicate that an interim assessment is necessary.

The summary of the Company's goodwill is as follows: Balance as of March 31, 2011 $ —

Additions 694 Impairment (694)

Balance as of June 30, 2011 $ —

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Intangible assets, subject to amortization as of June 30, 2011 and March 31, 2010 are as follows:

June 30,2011

March 31,2011

Customer relationships Gross carrying amount $ 261,970 $ 261,970 Accumulated amortization (222,889) (220,214)

Net carrying amount 39,081 41,756

Technology assets Gross carrying amount 32,114 32,114 Accumulated amortization (32,114) (32,114)

Net carrying amount — —

Trade names Gross carrying amount 2,934 2,934 Accumulated amortization (2,802) (2,778)

Net carrying amount 132 156

Total $ 39,213 $ 41,912

Intangible assets represent the identifiable intangible assets acquired in a business combination such as customer relationships, technology assets, andtrade names. The Company amortizes finite-lived intangible assets over their estimated useful lives on a straight-line basis up to 4.5 years, unless theeconomic benefits of the intangible are otherwise impaired. Intangible assets are reviewed for impairment at least annually or whenever events or changes incircumstances indicate that the carrying amounts may not be recoverable. In the table above, impairment is included in accumulated amortization; howeverthere were no impairment charges recorded in the three months ended June 30, 2011.

The tables below present the amortization included in Depreciation and amortization for the three months ended June 30, 2011 and 2010, and theestimated future amortization through fiscal 2016 for intangible assets as of June 30, 2011.


2011 2010 Amortization expense $ 2,586 $ 5,419 June 30, 2011 Estimated future amortization expense: Remainder of 2012 $ 7,538 2013 10,397 2014 9,980 2015 6,735 2016 4,563

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Note 10: Borrowings

Short term borrowings consist of the following:

June 30,2011

March 31,2011

Liquidity facility $ 342,000 $ 367,000 Bank overdrafts 24,088 15,961

Total $ 366,088 $ 382,961

Long-term borrowings consist of:

June 30,2011

March 31,2011

1.875% Convertible Notes due 2016 $ 232,763 $ 230,063 9.00% Convertible Notes due 2038 184,389 184,017

Total $ 417,152 $ 414,080

MFGI Secured Facility

On June 29, 2011, the Company's U.S. regulated broker-dealer subsidiary, MF Global Inc. ("MFGI"), entered into a $300,000 364-day securedrevolving credit facility (the "MFGI secured facility") with a syndicate of lenders. In connection with the execution of the MFGI secured facility, theCompany paid a one-time fee to participating lenders of $1,145 recorded in Other assets which will be amortized over the life of the facility.

Under the MFGI secured facility, MFGI pays a commitment fee on the undrawn amount of 20 basis points per annum. Loans under the MFGI securedfacility bear interest on the principal amount outstanding, at the option of MFGI, at either (i) the higher of (x) the average of the rates on the offered side ofthe federal funds market quoted by three interbank federal funds brokers and (y) the Eurodollar rate for a one-month interest period, each plus 1.25%, or (ii) aperiodic fixed rate equal to the rate appearing on the Reuters Screen LIBOR01 for U.S. Dollars plus 1.25%. On all outstanding amounts, the MFGI securedfacility is secured by eligible collateral owned by MFGI and is guaranteed by the Company and one of its financing subsidiaries. At June 30, 2011, there wasno outstanding balance under the MFGI secured facility.

The borrowings, so long as the MFGI secured facility is in effect and there are loans outstanding under that facility, are subject to the terms andconditions set forth in the MFGI secured facility. The MFGI secured facility includes a covenant requiring MFGI's consolidated tangible net worth at any timenot to be less than $227,329.

At June 30, 2011, MFGI was in compliance with its covenants under the MFGI secured facility.

Liquidity Facility

At March 31, 2010, the Company had a $1,500,000 unsecured committed revolving credit facility maturing June 15, 2012 (the "liquidity facility") witha syndicate of lenders.

On June 29, 2010, the liquidity facility was amended (the "Amendment") (i) to permit the Company, in addition to certain of its subsidiaries, to borrowfunds under the liquidity facility and (ii) to extend the lending

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commitments of certain of the lenders by two years, from June 15, 2012 (the "Old Maturity Date") to June 15, 2014 (the "Extended Maturity Date").Aggregate commitments under the amended liquidity facility are $1,200,875, all of which is available to the Company for borrowing until the Old MaturityDate (at which time, $511,250 will cease to be available for borrowing), and $689,625 of which is available for borrowing until the Extended Maturity Date.On June 15, 2012, outstanding borrowings subject to the Old Maturity Date (currently equal to $145,600) will become due. Under the terms of the amendedliquidity facility, the Company may borrow under the available loan commitment subject to the Extended Maturity Date to repay the outstanding balance onthe Old Maturity Date and also for general corporate purposes.

With respect to commitments and loans maturing on the Old Maturity Date (and at the current rating level and utilization), the Company pays a facilityfee of 10 basis points per annum and LIBOR plus 1.90% per annum on the outstanding borrowing. The liquidity facility is subject to a ratings-based pricinggrid. In the event credit ratings are downgraded, the highest rate on the grid would bring the facility fee to 12.5 basis points per annum and the rate on theoutstanding borrowing to LIBOR plus 2.375% per annum.

With respect to commitments and loans maturing on the Extended Maturity Date (and at the current rating level and utilization), the Company pays afacility fee of 40 basis points per annum and LIBOR plus 2.35% per annum on the outstanding borrowing. In the event credit ratings are downgraded, thehighest rate on the grid would bring the facility fee to 75 basis points per annum and the rate on the outstanding borrowing to LIBOR plus 2.75% per annum.

On borrowings in excess of $500,000 related to the total liquidity facility, the Company will only pay a facility fee of 10 basis points per annum andLIBOR plus 0.40% per annum with respect to commitments and loans maturing on the Old Maturity Date. With respect to commitments and loans maturingon the Extended Maturity Date, pricing is unchanged on amounts in excess of $500,000 of the total liquidity facility.

In all cases, borrowings are subject to the terms and conditions set forth in the liquidity facility which contains financial and other customary covenants.The amended liquidity facility includes a covenant requiring the Company to maintain a minimum Consolidated Tangible Net Worth of not less than the sumof (i) 75% of the pro forma Consolidated Tangible Net Worth as of March 31, 2010 after giving effect to the offering by the Company of equity interests onJune 2, 2010, including exercise of the underwriters' option to purchase additional shares, and the consummation in whole or in part of the offer to exchangeof the Company dated June 1, 2010 plus (ii) 50% of the net cash proceeds of any offering by the Company of equity interests consummated after the secondamendment effective date plus (iii) 25% of cumulative net income for each completed fiscal year of the Company after the second amendment effective datefor which consolidated net income is positive. The amended liquidity facility also requires the Company to limit its Consolidated Capitalization Ratio to be nogreater than 40% prior to March 31, 2011; 37.5% on or after March 31, 2011 and before March 31, 2012; and 35% on or after March 31, 2012. Furthermore,commencing on March 31, 2012, the amended liquidity facility also requires the Company to limit its Consolidated Leverage Ratio as at the last day of anyperiod of four fiscal quarters to be no greater than 3 to 1. Under the amended liquidity facility, the Company has agreed that it will not use proceeds of anyborrowing under the liquidity facility to redeem, repurchase or otherwise retire any 9% Convertible Notes. Furthermore, beginning March 31, 2012, theCompany will not permit at any time prior to July 1, 2013, cash and cash equivalents to be less than the entire outstanding amount of the 9% ConvertibleNotes.

The amended liquidity facility continues to provide that if (i) the Company fails to pay any amount when due under the facility, or to comply with itsother requirements mentioned above, (ii) the Company fails to pay

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any amount when due on other material debt (defined as $50,000 or more in principal) (iii) other material debt is accelerated in whole or in part by thelenders, or (iv) upon certain events of liquidation or bankruptcy, an event of default will occur under the facility. Upon an event of default, all outstandingborrowings, together with all accrued interest, fees and other obligations, under the facility will become due and the Company will not be permitted to makeany further borrowings under the facility. In May 2011, for purposes of prudent liquidity management, the Company borrowed $50,000 from the liquidityfacility. In March 2011, also for purposes of prudent liquidity management, the Company borrowed $75,000 from the liquidity facility, which wassubsequently repaid in April 2011. As of June 30 and March 31, 2011, $342,000 and $367,000, respectively, was outstanding under the liquidity facility withthe remainder available to the Company. The Company has classified the $342,000 of outstanding borrowings at June 30, 2011 under the liquidity facility asshort term debt. In connection with the Amendment, the Company paid a one-time fee to participating lenders of $6,818 recorded in Other assets which willbe amortized over the life of the facility.

At June 30, 2011, the Company was in compliance with its covenants under the liquidity facility.

1.875% Convertible Senior Notes

The Company has outstanding $287,500 aggregate principal amount of its 1.875% Convertible Senior Notes due 2016 (the "1.875% ConvertibleNotes"). The 1.875% Convertible Notes bear interest at a rate of 1.875% per year, payable semi-annually in arrears on February 15 and August 1 of each year,beginning August 1, 2011. The 1.875% Convertible Notes mature on February 1, 2016. Holders may convert the 1.875% Convertible Notes at their optionprior to August 1, 2015 upon the occurrence of certain events relating to the price of the Company's Common Stock or various corporate events. On or afterAugust 1, 2015, the holders may convert at the applicable conversion rate at any time prior to maturity. The initial conversion rate for the 1.875% ConvertibleNotes is 96.4716 shares of Common Stock per $1 principal amount of 1.875% Convertible Notes, equivalent to an initial conversion price of approximately$10.37 per share of Common Stock. The conversion rate will be subject to adjustment given certain events. The Company may not redeem the notes prior tomaturity. The Company used $150,500 of the net proceeds from the offering to repay outstanding indebtedness under the liquidity facility.

In connection with the issuance of the 1.875% Convertible Notes, on February 7, 2011, the Company entered into privately negotiated convertible bondhedge and warrant transactions. The convertible bond hedge transactions cover, subject to anti-dilution adjustments, approximately 27,735,585 shares of theCompany's Common Stock, which is the same number of shares initially issuable upon conversion of the 1.875% Convertible Notes, and are expected toreduce the potential dilution with respect to the Common Stock and/or reduce the Company's exposure to potential cash payments that may be required to bemade by the Company upon conversion of the 1.875% Convertible Notes. The warrant transactions cover the same initial number of shares of CommonStock, subject to anti-dilution adjustments with each of the counterparties. The warrants have an initial strike price equal to $14.23, or 75% above the closingprice of the Common Stock on the New York Stock Exchange on February 7, 2011. The Company may, subject to certain conditions, settle the warrants incash or on a net-share basis. The warrant transactions could have a dilutive effect with respect to the Common Stock or, if the Company so elects, obligate theCompany to make cash payments or issue additional shares of Common Stock to the extent that the market price per share of Common Stock exceeds theapplicable strike price of the warrant transactions on or before any expiration date of the warrants.

The Company used approximately $27,500 of the net proceeds from the offering of the 1.875% Convertible Notes to pay the cost of the purchase of theconvertible bond hedge transactions after such cost was partially

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offset by the aggregate proceeds of approximately $36,500 to the Company from the sale of the warrant transactions which were recorded in Equity on theconsolidated balance sheet. The convertible bond hedge transactions and the warrant transactions are separate transactions, each entered into by the Companywith the counterparties, are not part of the terms of the 1.875% Convertible Notes, and will not change any holders' rights under the 1.875% ConvertibleNotes. Holders of the 1.875% Convertible Notes will not have any rights with respect to the convertible bond hedge transactions or warrant transactions.


The Company has outstanding $187,763 aggregate principal amount of 9.00% Convertible Senior Notes due 2038 (the "9% Convertible Notes"). The9% Convertible Notes bear interest at a rate of 9.00% per year, payable semi-annually in arrears on June 15 and December 15 of each year. The 9%Convertible Notes mature on June 20, 2038. Holders may convert the 9% Convertible Notes at their option at any time prior to the maturity date. Uponconversion, the Company will pay or deliver, as the case may be, cash, Common Stock or a combination thereof at the Company's election. The initialconversion rate for the 9% Convertible Notes is 95.6938 shares of Common Stock per $1 principal amount of 9% Convertible Notes, equivalent to an initialconversion price of approximately $10.45 per share of Common Stock. The conversion rate will be subject to adjustment in certain events. The Company mayredeem the 9% Convertible Notes, in whole or in part, for cash at any time on or after July 1, 2013 at a price equal to 100% of the principal amount to beredeemed plus accrued and unpaid interest. Holders may require the Company to repurchase all or a portion of their 9% Convertible Notes for cash on July 1,2013, July 1, 2018, July 1, 2023, July 1, 2028 and July 1, 2033 at a price equal to 100% of the principal amount of 9% Convertible Notes to be repurchasedplus accrued and unpaid interest.

In accordance with ASC 470, Debt, the Company has separately accounted for the liability and equity components of its convertible debt instruments.Amounts recorded for the convertible debt instruments are as follows: June 30, 2011 March 31, 2011

9%Convertible

Notes

1.875%Convertible

Notes

9%Convertible

Notes

1.875%Convertible

Notes Principal $ 187,763 $ 287,500 $ 187,763 $ 287,500 Less: Debt discount (3,374) (54,737) (3,746) (57,437)

Net carrying amount $ 184,389 $ 232,763 $ 184,017 $ 230,063

Equity component $ 5,360 $ 58,861 $ 5,360 $ 58,861

The debt discount will be amortized through fiscal 2013 for the 9% Convertible Notes and through fiscal 2016 for the 1.875% Convertible Notes. TheCompany's effective interest rates on the 9% Convertible Notes and 1.875% Convertible Notes are 10.0% and 6.8%, respectively. The aggregate interestexpense associated with the semi-annual interest payment was $5,667 and $4,613 for the three months ended June 30, 2011 and 2010, respectively. The non-cash accretion of the debt discount was $3,071 and $367 for the three months ended June 30, 2011 and 2010, respectively.

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Note 11: Commitments and Contingencies

Legal

Legal and Regulatory Matters

The Company and its subsidiaries are currently, and in the future may be, named as defendants in or made parties to various legal actions and regulatoryproceedings ("legal and regulatory matters" or "these matters"). Some of these matters that are currently pending are described below under "Description ofParticular Matters". Claims for significant monetary damages are often asserted in many of these matters involving legal actions, although a number of theseactions seek an unspecified or indeterminate amount of damages, including punitive damages, while claims for disgorgement, penalties and other remedialsanctions may be sought by governmental or other authorities in regulatory proceedings. It is inherently difficult to predict the eventual outcomes of thesematters given their complexity and the particular facts and circumstances at issue in each of them.

In view of the inherent unpredictability of outcomes in legal and regulatory matters, particularly where (1) the damages sought are unspecified orindeterminate, (2) the proceedings are in the early stages or (3) the matters involve unsettled questions of law, multiple parties or complex facts andcircumstances, there is considerable uncertainty surrounding the timing or ultimate resolution of these matters, including a possible eventual loss, fine, penaltyor business impact associated with each matter. In accordance with ASC 450, Contingencies, the Company accrues amounts for legal and regulatory matterswhere it believes they present loss contingencies that are both probable and reasonably estimable. In such cases, however, the Company may be exposed tolosses in excess of any amounts accrued and may need to adjust the accruals from time to time to reflect developments that could affect its estimate ofpotential losses. Moreover, in accordance with ASC 450, if the Company does not believe that the potential loss from a particular matter is both probable andreasonably estimable, it does not make an accrual and will monitor the matter for any developments that would make the loss contingency both probable andreasonably estimable. The actual results of resolving these matters may involve losses that are substantially higher than amounts accrued (and insurancecoverage, if any).

Although the Company has made accruals for only some of the legal and regulatory matters, it believes that loss contingencies may, in the future, bereasonably possible for a number of these matters, including both matters for which no accruals have been made and matters for which they have. Under ASC450, an event is "reasonably possible" if the chance of the event occurring is more than "remote" or "slight." For matters as to which the Company believes aloss is reasonably possible and estimable, it currently estimates that the range of reasonably possible losses, in excess of amounts accrued, could be up toapproximately $150,000 in the aggregate. This estimated range, however, is subject to the following considerations. For one of these matters, although theCompany believes that losses are reasonably possible, it is currently unable to make a reasonable estimate of such losses. The Company discusses this matterbelow under "Description of Particular Matters—In re: Platinum and Palladium Commodities Litigation."

The estimated range also does not include the BMO matter, which is discussed below under "Description of Particular Matters—Bank of Montreal("BMO")". While the Company currently believes that losses are reasonably possible for the BMO matter, the Company believes it is difficult to make anyestimate of the potential losses at this stage of the proceedings, other than to refer to a range up to the amount of the claims made against the Company in thatmatter. Those claims, for which the Company has not made any accruals, are described in the next section under the heading relating to the BMO matter.

For the matters that are covered by the estimated range, the range reflects the following amounts. For some of the covered matters, where the Companybelieves it is able to do so, the Company has estimated the losses

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based on its current assessment of the particular facts and circumstances and legal issues relating to the matters as known and understood by the Company.For each of the remaining covered matters, however, the estimated range simply reflects the amount of compensatory damages claimed against the Companyin the matter or, where such damages are not specified or the Company believes it is otherwise appropriate, the Company's estimate of the value of thecontract, account or transaction that is the subject of the matter. Although some of the covered matters include claims for punitive or statutory (e.g., treble)damages, the estimated range does not reflect any potential losses from claims of this kind because at this point the Company believes amounts are too remoteor unpredictable. In addition, a number of covered matters involve claims or counterclaims relating to debit balances in customer accounts, in which theCompany has asserted or intends to assert offsetting claims to recover the debits, and for matters of this kind the estimated range reflects only the net amountof the claims against the Company. Also, the estimated range does not reflect any potential losses from the matters described below in the Description ofParticular Matters under the headings "Unauthorized Trading Incident of February 26/27 2008—Class Action Suits" (as to which the parties have agreed to apreliminary settlement, although the settlement remains subject to court approval and other conditions, and cannot be assured) and "Agape World" (which, asit relates to the Company, was dismissed by the lower court but remains subject to possible future appeal).

Finally, the estimated range reflects losses only in excess of amounts currently accrued for the covered matters, does not give effect to any potentialinsurance coverage, which might reduce the amounts owed in some contingencies, and does not reflect any legal fees or other expenses incurred in defendingor investigating any matters (which at times have been and in the future could be substantial) or that may be demanded by a counterparty.

The losses reflected in the estimated range could occur over a period of several years or longer. The estimated range is based on currently availableinformation, is subject to modification in light of future developments and changes in the Company's management's assessments and may not reflect the actualoutcome of any matters. For all the reasons described above, the estimated range does not represent the Company's maximum loss exposure from legal andregulatory matters.

Description of Particular Matters

Unauthorized Trading Incident of February 26/27, 2008

One of the brokers of the Company's U.S. operating subsidiary, MFGI, Evan Dooley, trading for his own account out of a Memphis, Tennessee branchoffice through one of MFGI's front end order entry systems, Order Express, put on a significant wheat futures position during the late evening of February 26,2008 and early morning of February 27, 2008. The positions were liquidated at a loss of $141,045 on February 27, 2008. The trades were unauthorized andbecause the broker had no apparent means of paying for the trades, MFGI, as a clearing member of the exchange, was required to pay the $141,045 shortfall(the "Dooley Trading Incident"). As a result of the Dooley Trading Incident:

• Class Action Suits. The Company, Man Group plc (former shareholder and parent company), certain of its current and former officers anddirectors, and certain underwriters for the IPO have been named as defendants in five actions filed in the United States District Court for theSouthern District of New York. These actions, which purport to be brought as class actions on behalf of purchasers of MF Global stock betweenthe date of the IPO and February 28, 2008, seek to hold defendants liable under §§ 11, 12 and 15 of the Securities Act of 1933 for allegedmisrepresentations and omissions related to the Company's risk management and monitoring practices and procedures. The five purportedshareholder

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class actions have been consolidated for all purposes into a single action. The Company made a motion to dismiss which had been granted, withplaintiff having a right to replead and/or appeal the dismissal. Plaintiffs made a motion to replead by filing an amended complaint, which wasdenied. Plaintiffs appealed. The Second Circuit Court of Appeals vacated the decision and remanded the case for further consideration. Theparties engaged in mediation and have agreed to a preliminary settlement, which is subject to various customary conditions, includingconfirmatory discovery, preliminary approval by the United States District Court for the Southern District of New York, notice to class members,class member opt-out thresholds, a final hearing, and final approval by the District Court. The settlement provides for a total payment of $90,000to plaintiffs. Of this total payment, $2,500 is payable by the Company and has been accrued.

• Insurance Claim. MFGI filed a claim for payment of its $141,045 loss plus statutory interest under its Fidelity Bond Insurance (the "Bond"),which provides coverage for wrongful or fraudulent acts of employees, seeking indemnification for the loss on the Dooley trading incident. Aftermonths of investigation, MFGI's Bond insurers denied payment of this claim based on certain definitions and exclusions to coverage in the Bond.They also initiated an action against MFGI in the Supreme Court of the State of New York, New York County, seeking a declaration that there isno coverage for this loss under the Bond. MFGI believes the insurers' position to be in error and filed a counterclaim in order to seek to enforceits right to payment in court. The Bond insurers sought partial summary judgment, which the Court denied. The Bond insurers have filed a Noticeof Appeal to the Appellate Division, First Department and also filed a motion to Renew or Reargue with the Supreme Court, challenging theportion of the decision that found that Dooley was an employee of the Company. Insurers' motion to Renew or Reargue has been denied and theyhave filed a Notice of Appeal on that issue as well.

Bank of Montreal ("BMO")

On August 28, 2009, BMO instituted suit against MFGI and its former broker, Joseph Saab (as well as a firm named Optionable, Inc. ("Optionable")and five of its principals or employees), in the United States District Court for the Southern District of New York. In its complaint, BMO asserts variousclaims based upon allegations that Optionable and MFGI provided BMO with price indications on natural gas option contracts that BMO allegedly believedwere independent but the indications had been provided by BMO's trader, David Lee, and were passed on to BMO, thereby enabling Lee substantially toovervalue BMO's natural gas options book. BMO further alleges that MFGI and Saab aided and abetted Lee's fraud and breach of his fiduciary duties bysending price indications to BMO. There are additional separate claims against other defendants. The Complaint seeks to hold all defendants jointly andseverally liable. Although the Complaint does not specify an exact damage claim, BMO claims that the cash loss resulting from Lee's fraudulent tradingactivity, which allegedly could have been prevented had BMO received "correct pricing information", is in excess of $500,000. In addition, BMO claims thatit would not have paid brokerage commissions to MFGI (and Optionable), would not have continued Lee and his supervisor as employees at substantialsalaries and bonuses, and would not have incurred substantial legal costs and expenses to deal with the overvaluation of its natural gas options book but fordefendants' alleged conduct. All defendants, including MFGI, made a motion to dismiss the complaint, which was denied by the court.

Amacker v. Renaissance Asset Management Fund et. al.

In December 2007, MFGI, along with four other futures commission merchants ("FCMs"), was named as a defendant in an action filed in the UnitedStates District Court in Corpus Christi, Texas by 47 individuals who

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were investors in a commodity pool (RAM I LLC) operated by Renaissance Asset Management LLC. The complaint alleges that MFGI and the otherdefendants violated the Commodity Exchange Act and alleges claims of negligence, common law fraud, violation of a Texas statute relating to securitiesfraud and breach of fiduciary duty for allegedly failing to conduct due diligence on the commodity pool operator and commodity trading advisor, havingaccepted executed trades directed by the commodity trading advisor, which was engaged in a fraudulent scheme with respect to the commodity pool, andhaving permitted the improper allocation of trades among accounts. The plaintiffs claim damages of $32,000, plus exemplary damages, from all defendants.All of the FCM defendants moved to dismiss the complaint for failure to state a claim upon which relief may be granted. Following an initial pre-trialconference, the court granted plaintiffs leave to file an amended complaint. On May 9, 2008, plaintiffs filed an amended complaint in which plaintiffsabandoned all claims except a claim alleging that the FCM defendants aided and abetted violations of the Commodity Exchange Act. Plaintiffs now seek$17,000 in claimed damages plus exemplary damages from all defendants. MFGI filed a motion to dismiss the amended complaint, which was granted by thecourt and appealed by the plaintiffs.

Voiran Trading Limited

On December 29, 2008, the Company received a letter before action from solicitors on behalf of Voiran Trading Limited ("Voiran") which has nowbrought an LME arbitration proceeding. The claimant alleges that the Company's U.K. affiliate was grossly negligent in advice it gave to Voiran betweenApril 2005 and April 2006 in relation to certain copper futures contracts and claims $37,600 in damages. This arbitration is scheduled for 2012.

Sentinel Bankruptcy

The Liquidation Trustee ("Trustee") for Sentinel Management Group, Inc. ("Sentinel") sued MFGI in June 2009 on the theory that MFGI's withdrawalof $50,200 within 90 days of the filing of Sentinel's bankruptcy petition on August 17, 2007 is a voidable preference under Section 547 of the BankruptcyCode and, therefore, recoverable by the Trustee, along with interest and costs. MFGI believes there are meritorious defenses available to it and it intends toresist the Trustee's attempt to recover those funds from MFGI. In addition, to the extent the Trustee recovered any funds from MFGI it would be able to assertan offsetting claim in that amount against the assets available in Sentinel's bankruptcy case.

Agape World

In May 2009, investors in a venture set up by Nicholas Cosmo sued Bank of America and MFGI, among others, in the United States District Court forthe Eastern District of New York, in two separate class actions and one case brought by certain individuals, alleging that MFGI, among others, aided andabetted Cosmo and related entities in a Ponzi scheme in which investors lost $400,000. MFGI made motions to dismiss all of these cases which were grantedwith prejudice. The time when plaintiffs are able to appeal the dismissal will not begin to run until the action against the remaining defendants is decided.

Phidippides Capital Management/Mark Trimble

In the late spring of 2009, MFGI was sued in Oklahoma State Court by customers who were substantial investors with Mark Trimble and/orPhidippides Capital Management. Plaintiffs allege that Trimble and Phidippides engaged in a Ponzi scheme and that MFGI "materially aided and abetted"Trimble's and Phidippides' violations of the anti-fraud provisions of the Oklahoma securities laws. They are seeking damages in the amount of $20,000. MFGImade a motion to dismiss which was granted by the court. Plaintiffs appealed.

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The Court of Civil Appeals for the State of Oklahoma upheld MFGI's dismissal. Plaintiffs filed a petition for certiorari with the Supreme Court of Oklahoma,which was denied. On July 15, 2011, plaintiffs filed a Third Amended Petition against MFGI and seek to assert or reassert claims against MFGI under theOklahoma Securities Act and a new claim of common law negligence. It has reduced the damages claim to $7,000.

In re: Platinum and Palladium Commodities Litigation

On August 4, 2010, MFGI was added as a defendant to a consolidated class action complaint filed against Moore Capital Management and relatedentities in the United States District Court for the Southern District of New York which alleged claims of manipulation and aiding and abetting manipulationin violation of the Commodities Exchange Act. Specifically, the complaint alleged that, between October 25, 2007 and June 6, 2008, Moore Capital directedMFGI, as its executing broker, to enter "large" market on close orders (at or near the time of the close) for platinum and palladium futures contracts, whichallegedly caused artificially inflated prices. On August 10, 2010, MFGI was added as a defendant to a related class action complaint filed against the Moore-related entities on behalf of a class of plaintiffs who traded the physical platinum and palladium commodities in the relevant time frame, which alleges pricefixing under the Sherman Act and violations of the civil Racketeer Influenced and Corrupt Organizations Act. On September 30, 2010 plaintiffs filed anamended consolidated class action complaint that includes all of the allegations and claims identified above on behalf of subclasses of traders of futurescontracts of platinum and palladium and physical platinum and palladium. A motion to dismiss was heard on February 4, 2011. Plaintiffs' claimed damageshave not been quantified.

Marion Hecht as Receiver for Joseph Forte, L.P.

On December 21, 2010, Marion Hecht, as Receiver for Joseph Forte, L.P. (the "Partnership"), filed a complaint against MFGI in the United StatesDistrict Court for the Eastern District of Pennsylvania that alleges one claim of negligence. Specifically, the complaint alleges that the Partnership had atrading account with MFGI and that MFGI violated its duties imposed by state law and under the Commodity Exchange Act by failing to recognize that thePartnership was not properly registered with the CFTC or the National Futures Association, or take reasonable action in response to a false claimedexemption, failing to require the Partnership to provide financial reports or other financial records, failing to make sufficient inquiries or take action regardingthe registration when discrepancies in Partnership documents existed, failing to reasonably recognize or to take action upon the unusual activity in thePartnership account, and that MFGI's conduct enabled the Partnership to operate a Ponzi scheme and cause damage to the investors. The Receiver claimsMFGI caused losses in excess of $10,000. MFGI filed a motion to dismiss that was denied. MFGI has filed a motion for judgment on the pleadings.

In re: Agape World Inc. Bankruptcy

On January 28, 2011, Kenneth Silverman as Chapter 7 Trustee of Agape World, Inc. (a substantively consolidated bankruptcy estate of various Agapeentities, collectively, "Agape") filed a complaint against MFGI in the United States Bankruptcy Court, Eastern District of New York seeking to recover thetransfers made by Agape to MFGI totaling $27,100 plus any fees earned in connection with the trades. Specifically, the Trustee alleges that the transfers andthe fees received by MFGI are recoverable as fraudulent conveyances because MFGI allegedly received these funds not in good faith. The basis for thealleged bad faith is that MFGI failed to conduct sufficient diligence when opening the account, failed to respond to red flags about how account principalNicholas Cosmo was using Agape's funds and failed to provide proper oversight and monitoring which, if conducted, would have caused termination of theaccounts and trading, and prevented losses to the investors.

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US Mortgage Corp et al. via Anthony Calascibetta as Liquidating Trustee

On February 22, 2011, Anthony Calascibetta, Liquidating Trustee for U.S. Mortgage Corp. and CU National Mortgage, LLC ("Debtors") filed acomplaint against MFGI in the United States Bankruptcy Court, District of New Jersey, seeking to avoid and recover transfers in the total amount of $4,800.Specifically, the complaint alleges the Debtors utilized MFGI in connection with the purchase and sale of securities, and that the sums expended for thesecurities are recoverable by the Liquidating Trustee as fraudulent transfers intended to hinder or defraud creditors of the Debtors, or under state law, and thatMFGI intentionally disregarded unspecified facts that informed MFGI and its agents that the transfers in question were fraudulent and unauthorized. MFGIhas filed a motion to dismiss. The Liquidating Trustee recently filed a motion to amend the complaint to seek recovery of an additional $1,600 in transfers.

German Introducing-Broker Litigation

In recent years, two of the Company's subsidiaries have been named as defendants in numerous lawsuits filed in German federal courts by plaintiffswho had accounts introduced by German introducing brokers. Plaintiffs allege that the introducing brokers had contractual relationships with the twosubsidiaries, and executed equity options and other derivatives transactions for them through the subsidiaries, and that the subsidiaries should be liable forcertain alleged tortious acts of both the introducing brokers and the subsidiaries. Plaintiffs seek to recover investment losses, statutory interest, attorney's feesand costs. The Company has not conducted retail business through German introducing firms since 2006. None of the damages claimed by any individualclaimant is material, and to date many of the claims have been settled or adjudicated with minimal impact on the Company, however, the number of theselawsuits has increased in the past year. In addition, in 2010, the German Supreme Court ruled in favor of plaintiffs in a similar case against another firm andsince that time the trend in cases involving the Company's subsidiaries has increasingly been to find foreign clearing brokers liable for the alleged tortiousconduct of local introducing brokers.

Other Matters

In addition to the matters described above, the Company and its subsidiaries currently are, and in the future may be, named as defendants or otherwisemade parties to various legal actions and regulatory matters that arise in the ordinary course of business. Aside from the matters described above under"Description of Particular Matters" and those reflected in the estimated range of reasonably possible losses, the Company does not believe, on the basis ofmanagement's current knowledge and assessments, that it is party to any pending or threatened legal or regulatory matters that, either individually or in theaggregate, after giving effect to applicable accruals and any insurance coverage, will have a material adverse effect on the Company's consolidated financialcondition, operating results or cash flows.

U.K. Bonus Tax

In December 2009, the U.K. government introduced legislation which would impose a 50% charge on certain discretionary bonus payments in excessof £25, made between December 9, 2009 and April 5, 2010 to U.K. employees within the financial services industry. This law was enacted in April 2010 andduring the year ended March 31, 2011, the Company paid approximately $3,000.

Guarantees

The Company is required to disclose representations and warranties which it enters into and which may provide general indemnifications to others. Asof June 30, 2011 and 2010, the Company has guaranteed loans to

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certain individuals for their purchase of exchange seats. In these arrangements, the Company can sell the exchange seats to cover amounts outstanding. As ofJune 30, 2011 and 2010 the Company has not recorded a guarantee liability, as the fair value of the exchange seats exceeds any potential loss on these loans.

Additionally, in its normal course of business, the Company may enter into contracts that contain such representations and warranties. The Company'smaximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company that have not yetoccurred. However, based on its experience, the Company expects the risk of loss to be remote. The Company is a member of various exchanges and clearingorganizations. Under the standard membership agreement, members are required to guarantee collectively the performance of other members. Under theagreements, if another member becomes unable to satisfy its obligations to the clearing house, other members would be required to meet shortfalls. TheCompany's liability under these arrangements is not quantifiable and could exceed the cash and securities they have posted as collateral. However, theCompany believes that the potential for the Company to be required to make payments under these arrangements is remote, and accordingly, no liability hasbeen recorded.

As of June 30, 2011, the Company is contingently liable for guarantees of indebtedness owed by MFGI to a syndicate of lenders under the MFGIsecured facility. The MFGI secured facility is secured by eligible collateral owned by MFGI. The Company's obligation under the MFGI secured facility mayexceed the amount of MFGI's liability at any time. See Note 10 for further information.

Other Commitments

Certain clearing-houses, clearing banks, and clearing firms utilized by the Company are given a security interest in certain assets of the Company heldby those clearing organizations. These assets may be applied to satisfy the obligations of the Company to the respective clearing organizations.

Lines of Credit

The Company has a $1,200,875 four-year unsecured committed revolving liquidity facility (of which $511,250 will mature in 2012) and a $300,000364-day secured revolving facility through MFGI. See Note 10 for further information. The Company also has uncommitted credit agreements with financialinstitutions, in the form of trading relationships, which facilitate execution, settlement, and clearing flow on a day-to-day basis for the Company's clients, aswell as provide evidence, as required, of liquidity to the exchanges on which it conducts business. As of June 30 and March 31, 2011, the Company had$5,900 and $0 of issued letters of credit, respectively.

Note 12: Convertible Preferred Stock

Non-Cumulative Convertible Preferred Stock, Series B

In June 2008, the Company completed the issuance and sale of $150,000 in aggregate liquidation preference of its 9.75% Non- Cumulative ConvertiblePreferred Stock, Series B (the "Series B Preferred Stock"). The Company pays dividends on the Series B Preferred Stock, when, as and if declared by itsboard of directors, quarterly in arrears at a rate of 9.75% per year, payable on February 15, May 15, August 15 and November 15. Dividends on the Series BPreferred Stock are not cumulative and may be paid in cash, common stock or both.

The Series B Preferred Stock is convertible, at the holder's option, at any time, initially into 9.5694 shares of common stock based on an initialconversion price of approximately $10.45 per share, subject to specified

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adjustments. The conversion rate will also be adjusted upon the occurrence of certain make-whole acquisition transactions and other events. On or afterJuly 1, 2018, if the closing price of the Company's common stock exceeds 250% of the then-prevailing conversion price for 20 trading days during anyconsecutive 30 trading day period, the Company may, at its option, cause the Series B Preferred Stock to be automatically converted into common stock at thethen-prevailing conversion price. There is no beneficial conversion feature to be recognized at the issuance date of the Series B Preferred Stock, however,given certain conditions, a beneficial conversion feature could be recognized in the future.

The Series B Preferred Stock ranks junior to the Company's indebtedness and senior to the common stock. Upon liquidation of the Company, holders ofSeries B Preferred Stock are entitled to receive a liquidation amount of $100 per share plus declared dividends prior to any distribution to holders of CommonStock.

As of June 30, 2011, 403,550 shares of Series B Preferred Stock remain outstanding. The terms and conditions of the Series B Preferred Stock remainunchanged.

Cumulative Convertible Preferred Stock, Series A

In July 2008, the Company completed the issuance and sale of $150,000 in aggregate liquidation preference of its Cumulative Convertible PreferredStock, Series A (the "Series A Preferred Stock") to J.C. Flowers II L.P. ("J.C. Flowers"). The Company used the net proceeds from the sale of the Series APreferred Stock to repay a portion of the Company's then outstanding bridge facility pursuant to its capital plan. Pursuant to certain previously disclosedadjustment provisions of its Investment Agreement with J.C. Flowers and as a result of its completed private offerings of Series B Preferred Stock and 9%Convertible Notes, the Company paid J.C. Flowers approximately $36,300 in cash and reset the annual dividend rate on the Series A Preferred Stock, from6.0% to 10.725%. In July 2008, the Company also paid J.C. Flowers its $4,500 fee in cash in connection with the backstop facility provided by J.C. Flowersunder the Investment Agreement. The Series A Preferred Stock ranks senior to the Company's common stock with respect to dividend rights and rights uponliquidation of the Company.

Under the terms of the Investment Agreement, J.C. Flowers agreed to purchase a minimum of 1,500,000 shares, for an aggregate value of $150,000 andup to a maximum of 3,000,000 shares, for an aggregate value of $300,000, of a newly authorized series of the Company's convertible preferred stock,designated as 6.0% Cumulative Convertible Preferred Stock, Series A at a stated offer price which was 100% of their liquidation amount or preference, i.e.$100 per share. The Series A Preferred Stock is convertible any time, at the option of the holder, into eight shares of the Company's common stock,representing an initial conversion price of $12.50 per share.

Subject to certain exceptions, J.C. Flowers may not beneficially own 20% or more of the Company's outstanding common stock for a period of threeyears after the closing. Immediately prior to signing the definitive agreement with J.C. Flowers, the Company also amended its then existing shareholderrights plan (which has since been terminated) to exclude J.C. Flowers (including any affiliate of J.C. Flowers), after the first time it becomes the beneficialowner of 15% or more of the Company's common stock, and until such time as either it falls below the threshold or becomes the owner of 20% or more of theCompany's common stock, from the provision that triggers the shareholder rights plan when any person acquires 15% or more of the Company's issued andoutstanding common stock without approval of its board of directors.

The conversion rate and the conversion price are subject to adjustments in certain circumstances. Dividends on the Series A Preferred Stock arecumulative at the rate of 10.725% per annum, payable in cash or common

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stock, at the Company's option, and holders will participate in common stock dividends, if any. Dividends are payable if, as and when determined by theCompany's board of directors, but if not paid they accumulate and dividends accrue on the arrearage at the same annual rate. Accumulated dividends on theSeries A Preferred Stock become payable in full upon any conversion or any liquidation of the Company. The Company will not be permitted to pay anydividends on or to repurchase shares of its common stock during any period when dividends on the Series A Preferred Stock are in arrears. Holders will havethe right to vote with holders of the common stock on an "as-converted" basis. The Company may require the holders to convert the stock at any time afterMay 15, 2013 when the closing price of the common stock exceeds 125% of the conversion price for a specified period. In connection with the investment,J.C. Flowers was granted the right to appoint a director to the Company's Board of Directors. Pursuant to this right, the Company appointed David I. Schamisto its board. In addition, if the Company fails to pay dividends on the Series A Preferred Stock for six quarterly periods, whether or not consecutive, the SeriesA preferred shareholders will have the right as a class to elect two additional directors to the Company's board.

On April 29, 2011, the Company's Board of Directors declared a quarterly dividend on the Series A Preferred Stock and Series B Preferred Stock inamounts of $4,022 and $983, respectively. These dividends had a record date of May 1, 2011 and were paid on May 13, 2011.

Note 13: Stock-Based Compensation Plans

The Company established the 2007 Long-term Incentive Plan ("LTIP") which provides for equity compensation awards in the form of stock options,stock appreciation rights, restricted stock, restricted stock units, performance awards, cash-based awards and other awards to eligible employees, consultants,directors, and other individuals who provide services to the Company, each as determined by the Compensation Committee of the Board of Directors. As ofJune 30, 2011, the LTIP provides for the issuance of up to 32,723,295 shares.

The Company issued restricted stock units, stock options, and restricted stock under the LTIP. Generally, the majority of stock options vest in equalinstallments over three years, and vested awards can be exercised, subject to continued employment, within seven years from the date of grant. Stock optionshave an exercise price, equal to the price per share of common stock at the grant date. Restricted stock units generally vest ratably or in full after three years,subject to continued employment or meeting certain retirement eligibility criteria. Certain restricted stock units and restricted stock issued at the Company'sinitial public offering ("IPO") are defined as non-recurring IPO awards and are presented in Employee compensation related to non-recurring IPO awardswithin the consolidated statement of operations.

Compensation expense for the stock-based compensation plans has been measured in accordance with ASC 718, Compensation- Stock Compensation.For the three months ended June 30, 2011 and 2010, compensation costs include the following related to the Company's stock-based compensationarrangements:


2011 2010 Compensation costs Employee compensation and benefits (excluding IPO awards) $ 10,053 $ 9,527 Employee compensation related to non-recurring IPO awards — 8,595

Total $ 10,053 $ 18,122

Income tax benefits $ 3,282 $ 5,662

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The Company has no pool of windfall tax benefits. The Company records deferred taxes on its consolidated balance sheets related to stockcompensation awards. Due to declines in the Company's stock price, these may not equal the tax benefit ultimately realized at the date of delivery of theseawards, as the deferred tax assets are based on the stock awards' grant date fair value and any shortfall will result in a charge to the consolidated statement ofoperations in Provision for income taxes. A shortfall of $1,165 was recorded as tax expense in the three months ended June 30, 2011.

The fair value of each stock option is estimated on the date of grant using a Black-Scholes option valuation model that uses the following assumptions:

Expected Volatility: Due to the lack of historical data for the Company's own stock, the Company based its expected volatility on a representative peergroup that took into account the following criteria: industry, market capitalization, stage of life cycle and capital structure.

Expected Term: Expected term represents the period of time that options granted are expected to be outstanding. The Company elected to use thesimplified' calculation method, which is to be used for companies that lack extensive historical data. The mid-point between the vesting date and thecontractual expiration date is used as the expected term under this method.

Expected Dividend Yield: The Company has not paid and does not expect to pay dividends on its Common Stock in the future. Accordingly, theassumed dividend yield is zero.

Risk Free Interest Rate: The risk-free rate is determined using the implied yield currently available on zero-coupon U.S. government bonds with a termconsistent with the expected term on the date of grant.


2011 2010 Expected volatility 45.9% 49.0% Risk free interest rate 2.1% 2.9% Expected dividend yield 0% 0% Expected term 5.5 years 5.5 years

The following tables summarize activity for the Company's plans for the three months ended June 30, 2011:

Options

Weighted-Average

Exercise Price(per share)

Weighted-Average

RemainingContractual

Term(in years)

AggregateIntrinsic

Value Stock options outstanding at April 1, 2011 11,310,139 $ 14.43

Granted 2,600,000 7.68 Exercised (6,759) 5.92 Forfeited and cancelled (1,704,259) 6.21

Stock options outstanding as of June 30, 2011 12,199,121 13.56 6.2 3,523 Stock options fully vested and expected to vest as of June 30, 2011 11,733,676 13.81 6.2 3,294 Stock options exercisable at June 30, 2011 7,308,633 $ 17.68 5.4 $ 1,371

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During the three months ended June 30, 2010, 2,514,797 options were granted and 610,466 options were forfeited or cancelled. The weighted-averagegrant-date fair value of options granted during the three months ended June 30, 2011 and 2010 was $3.24 and $4.44, respectively. The total cash receivedfrom options exercised during the three months ended June 30, 2011 was $40 and there were no tax benefits realized from these exercises. The total intrinsicvalue of options exercised during the three months ended June 30, 2011 and 2010 was $10 and $294, respectively. Restricted Stock Units

Awards

Weighted-AverageGrant Date Fair

Value (per award) Nonvested as of April 1, 2011 10,871,144 $ 7.81

Granted 3,663,563 7.45 Vested (1,789,276) 8.21 Forfeited (42,401) 7.88

Nonvested as of June 30, 2011 12,703,030 $ 7.65 Total unrecognized compensation expense remaining $ 70,592 Weighted-average years expected to be recognized over 2.3

During the three months ended June 30, 2010, 4,555,118 restricted stock units were granted, with a weighted average grant date fair value of $7.92, and539,932 restricted stock units were forfeited. During the three months ended June 30, 2010, 459,704 shares of stock were issued from the vesting of restrictedstock units. The total fair value of restricted stock units vested during the three months ended June 30, 2011 and 2010 was $14,690 and $4,643, respectively. Restricted Stock

Awards

Weighted-AverageGrant Date Fair

Value (per award) Nonvested as of April 1, 2011 41,550 $ 7.22

Vested (41,550) 7.22

Nonvested as of June 30, 2011 — $ — Total unrecognized compensation expense remaining $ — Weighted-average years expected to be recognized over —

During the three months ended June 30, 2010, no shares of restricted stock were granted or forfeited. During the three months ended June 30, 2010,19,280 shares of restricted stock vested. The total fair value of restricted stock vested during the three months ended June 30, 2011 and 2010 was $150 and$127, respectively.

The Company has employee stock purchase plans in the U.S. and U.K. to provide employees with an opportunity to purchase shares from the Companyat a discount and to pay for these purchases through payroll deductions. In the U.S., participants can withhold 1-15% of their eligible compensation; however,no participant can purchase more than 500 shares or total shares exceeding $8 in fair market value. During the three months ended June 30, 2011 and 2010, noshares were issued from this plan. In the U.K., participants can withhold up to £0.25 per month over 3 to 5 years to purchase shares at a 20% discount fromthe price on the date of grant. During the three months ended June 30, 2011 and 2010 no shares were issued from this plan. These plans are accounted for ascompensatory under ASC 718.

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Note 14: Income Taxes

Effective Income Tax Rate

The effective income tax rate for the three months ended June 30, 2011 and 2010 was approximately 27.6% and 49.1%, respectively. The change in theCompany's effective tax rate for the three months ended June 30, 2011 reflects (i) decreased gross unrecognized tax benefits as a result of decisions in certaintax cases being resolved favorably, (ii) the impact of the Company's share price on the value of vested equity compensation and, (iii) changes in the relativepercentage of expected profits and losses being earned in higher-tax jurisdictions. The Company's annual effective tax rate on ordinary operations (excludingdiscrete items) for the three months ended June 30, 2011, was approximately 37.0% compared to 33.1% for the three months ended June 30, 2010.

Realization of deferred tax assets is dependent upon multiple variables including available loss carrybacks, future taxable income projections, thereversal of current temporary differences, and tax planning strategies. U.S. GAAP requires that the Company continually assess the need for a valuationallowance against all or a portion of its deferred tax assets. While the Company was profitable for the quarter ended June 30, 2011, the Company wasnonetheless in a three-year cumulative pre-tax loss position as of June 30, 2011 in many jurisdictions in which it does business. A cumulative loss position isconsidered negative evidence in assessing the realization of deferred tax assets. The Company has concluded that the weight given to this negative evidence isdiminished due to significant non-recurring loss and expense items recognized during the three prior years, including IPO-related costs, asset impairments andcosts related to exiting unprofitable business lines. The Company has also concluded that there is sufficient positive evidence to overcome this negativeevidence. The positive evidence includes three means by which the Company is able to fully realize its deferred tax assets. First is the reversal of existingtaxable temporary differences. Second, the Company is forecasting sufficient taxable income in the carry forward period. The Company believes that futureprojections of income can be relied upon because the income expected is based on key drivers of profitability that it began to see evidence of in fiscal 2011.Most notable in this regard are plans and assumptions relating to the significant changes to the Company's compensation structure implemented in fiscal 2011,increased trading volumes, and other macro-economic conditions. Third, in certain of its key operating jurisdictions, the Company has sufficient tax planningstrategies, which should permit realization of its deferred tax assets. Management believes these strategies are both prudent and feasible. The amount of thedeferred tax assets considered realizable, however, could be significantly reduced in the near term if the Company's actual results are significantly less thanforecast. If this were to occur, it is likely that the Company would record a material increase in its valuation allowance. Loss carryforwards giving rise to aportion of the overall net deferred tax asset either do not expire or expire no earlier than fiscal 2031.

Uncertain Tax Positions

As of March 31, 2011, the Company had total unrecognized tax benefits of $22,809. For the three months ended June 30, 2011, the Company haddecreased its gross unrecognized tax benefits by $4,146 as a result of decisions in certain tax cases being resolved favorably. The Company increased its grossunrecognized benefits by $1,016. The Company had approximately $6,311 accrued for the estimated interest and penalties on previously recordedunrecognized tax benefits at June 30, 2011.

The amount of gross unrecognized tax benefits that would, if recognized, affect the Company's effective income tax rate in future periods equals$18,801. It is expected that unrecognized tax benefits will decrease in the next twelve months by an immaterial amount as a result of expiring statutes oflimitations or settlements. The Company does not expect this change to have a significant impact on the results of operations or financial position of theCompany.

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Note 15: Earnings per Share

The Company computes earnings per share in accordance with the applicable accounting standards, which discuss the accounting for earnings per shareand participating securities and the two-class method. The Company's Series A Preferred Stock is classified as a participating security whereby the holderparticipates in undistributed earnings with common shareholders.

The numerator for Basic EPS is net income attributable to MF Global Holdings Ltd., reduced by an allocation of earnings between commonshareholders and the Series A Preferred Shareholder, based on their respective rights to receive dividends on the Company's common stock as well as anyundeclared dividends for the Series A Preferred Stock where the shareholder has a cumulative right to dividends. This is then reduced by dividends declaredfor the Series B Preferred Stock. The denominator for Basic EPS is the weighted average number of shares of common stock outstanding.

If dilutive, the numerator for Diluted EPS is net income attributable to MF Global Holdings Ltd. after adjusting for the interest expense recorded on the9% Convertible Notes, net of tax. The denominator for Diluted EPS is the weighted average number of shares of common stock outstanding with the potentialeffect of stock awards, 1.875% Convertible Notes including the impact of the privately negotiated convertible bond hedge and warrant transactions, 9%Convertible Notes, Series A and Series B Preferred Stock, if dilutive. The Company uses the if-converted method to determine the potentially dilutive effectof the 9% Convertible Notes, Series A and Series B Preferred Stock.

The Company uses the treasury stock method to reflect the potentially dilutive effect of the unvested stock awards, 1.875% Convertible Notes, andpurchased calls and sold warrants related to the 1.875% Convertible Notes. With regards to the unvested stock awards, the assumed proceeds from theassumed vesting and delivery were calculated as the sum of (a) the amount of compensation cost attributed to future services and not yet recognized as ofJune 30, 2011 and (b) the amount of tax benefit, if any, that was credited to additional paid-in capital assuming vesting and delivery of the restricted stock lessproceeds received (in the case of stock options). With regards to the 1.875% Convertible Notes, there is no impact to Diluted EPS until the Company's stockprice exceeds the contractual conversion price of the 1.875% Convertible Notes, which is $10.37. At that time, the denominator would be adjusted to includeonly the incremental shares required to settle the excess value over par of the convertible notes upon conversion. While the purchased calls are designed toeconomically offset the dilutive effect of the 1.875% Convertible Notes, under U.S. GAAP, the anti-dilutive effect of the purchased calls cannot be reflectedin the Diluted EPS until the instrument is settled. For the sold warrants, there is a dilutive impact once the Company's stock price exceeds the strike price of$14.23 which is measured under the treasury stock method assuming the proceeds from exercised warrants are used to repurchase outstanding shares. AtJune 30, 2011 since the average Common Stock price did not exceed the conversion or strike price, there were no incremental shares included in thedenominator.

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The computation of earnings per share is as follows:

Three months ended

June 30,

2011 2010 Basic and diluted earnings per share:

Numerator: Net income attributable to MF Global Holdings Ltd. $ 13,309 $ 8,821 Less: Dividends declared for Series A Preferred Stock (4,022) (4,022)

Cumulative and participating dividends (630) (360) Dividends declared on Series B Preferred Stock (983) (3,656)

Net income applicable to common shareholders $ 7,674 $ 783

Denominator: Basic weighted average shares of common stock outstanding 164,272,690 130,196,655

Diluted weighted average shares of common stock outstanding 164,293,357 133,999,818

Basic and Diluted earnings per share $ 0.05 $ 0.01

In calculating diluted earnings per share for the three months ended June 30, 2011 and 2010, 20,667 and 3,803,163, respectively, of outstanding stockawards are dilutive, while the impact of certain other outstanding stock awards, 9% Convertible Notes, 1.875% Convertible Notes, and Series A and Series BPreferred Stock are anti-dilutive. The 9% Convertible Notes, 1.875% Convertible Notes and Series A and Series B Preferred Stock are weighted based on theamount outstanding during the respective period presented. The following table presents the potential stock excluded from the computation of diluted earningsper share because the effect would have been anti-dilutive: Three months ended June 30,

2011 2010 Restricted stock units and restricted stock 12,663,792 8,330,666 Stock options 12,199,121 8,960,499 1.875% Convertible Notes 27,735,585 — 9.0% Convertible Notes 17,967,751 19,617,225 Series B Preferred Stock 3,861,722 14,354,067 Series A Preferred Stock 12,000,000 12,000,000

Total 86,427,971 63,262,457

Note 16: Segment and Geographic Information

At June 30, 2011, the Company has one reportable business segment, as defined by the accounting standard for disclosures about segments of anenterprise and related information. This standard requires a public enterprise to report financial information on a basis consistent with that used bymanagement to allocate resources and assess performance. The Company is operated and managed by its chief operating decision maker on an integratedbasis as a single operating segment. The Company does not manage its business by services or product

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lines, market types, geographic regions, client segments or any other exclusive category. As management continues to implement its strategy to reorganize theCompany's business model it may change its reporting and disclosures in the future to reflect any changes to the segmentation of its business.

Each region's contribution to the consolidated amount is as follows:


2011 2010 Revenues, net of interest and transaction-based expenses:

North America $ 122,162 $ 145,212 Europe 160,321 102,613 Rest of World 32,035 41,610

Total $ 314,518 $ 289,435

Revenues, net of interest and transaction-based expenses are attributed to geographic areas based on the location of the relevant legal entities. Rest ofworld comprises primarily the Asia/Pacific region. Revenues, net of interest and transaction-based expenses by product have not been provided as thisinformation is impracticable to obtain.

Note 17: Regulatory Requirements

The Company conducts its securities and commodities businesses though several regulated subsidiary entities around the world which are subject to therules and regulations of the applicable local supervisory authorities and principal exchanges of which they are members. These supervisory authorities andexchanges each have defined capital requirements which the respective subsidiaries of the Company are subject to. The two principal subsidiary entities of theCompany conducting such business are MFGI in the U.S. and MF Global UK Limited ("MGFUKL") in the U.K. MFGI, a futures commission merchant andsecurities broker-dealer, is required to maintain minimum net capital equal to the greater of the amount required by the SEC or CFTC, as defined. At June 30,2011, MFGI had net capital, as defined, of $570,931, net capital requirements of $399,976, and excess net capital of $170,955.

MFGI is subject to certain notifications and other provisions of the net capital rules of the SEC regarding advances to affiliates, repayments ofsubordinated liabilities, dividend payments and other equity withdrawals. At June 30, 2011, MFGI was in compliance with all of these provisions.

In accordance with the rules of the FSA in the U.K., the Company's FSA-regulated subsidiary, MFGUKL, must comply with the financial resourcesrequirements of the European Union's Capital Requirements Directive. The capital held is intended to absorb unexpected losses and a minimum requirementis calculated in accordance with a standard regulatory formula that addresses the exposure to counterparty credit risk, position/market risk, foreign exchangerisk, operational risk and concentration risk. Counterparty risk is calculated as a percentage of unpaid customer margin for exchange traded business and anexposure calculation for off-exchange business. Position risk is calculated by applying percentages to positions based on the underlying instrument andmaturity. However, for the purposes of prudential supervision, the Company as a consolidated group, is not subject to the consolidated regulatory capitalrequirements of the European Union's Capital Requirements Directive.

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At June 30, 2011, MFGUKL had financial resources in total, as defined, of $622,110, resource requirements of $438,426, and excess financialresources of $183,684. Regulators may, in addition to setting minimum capital requirements, require that regulated firms hold capital over the minimumamounts as early warning levels to address potential risk which may crystallize in periods of market stress.

The Company's other regulated subsidiaries are also subject to the respective requirements of other regulatory bodies and exchanges of which they aremembers in other international locations in which they conduct business. The Company's other regulated subsidiaries were in compliance with all of therespective capital requirements at June 30, 2011 and 2010.

Note 18: Subsequent Events

Dividends

On July 26, 2011, the Company's Board of Directors declared a quarterly dividend on the Series A Preferred Stock and Series B Preferred Stock in anaggregate amount of $4,022 and $983, respectively. These dividends have a record date of August 2, 2011 and payment date of August 15, 2011.


On August 2, 2011, the Company completed an offering of $325,000 aggregate principal amount of its 3.375% Convertible Senior Notes due 2018 (the"3.375% Convertible Notes"). The Company also granted to its underwriters, at pricing, a 30-day option to purchase an additional $45,000 principal amountof the 3.375% Convertible Notes. This additional purchase option will carry the same terms as the original offering. The 3.375% Convertible Notes bearinterest at a rate of 3.375% per year, payable semi-annually in arrears on February 1 and August 1 of each year, beginning February 1, 2012 and mature onAugust 1, 2018. Holders may convert the 3.375% Convertible Notes at their option prior to February 1, 2018 upon the occurrence of certain events relating tothe price of the Company's Common Stock or various corporate events. On or after February 1, 2018, the holders may convert at the applicable conversionrate at any time prior to the second scheduled trading day prior to maturity. The initial conversion rate for the 3.375% Convertible Notes is 101.0331 shares ofCommon Stock per $1 principal amount of 3.375% Convertible Notes, equivalent to an initial conversion price of approximately $9.90 per share of CommonStock. The conversion rate will be subject to adjustment upon the occurrence of certain events. The Company may not redeem the notes prior to maturity. TheCompany used $25,162 proceeds from the offering to fund the cost of entering into the convertible note hedge and warrant transactions described below. TheCompany also used approximately $130,620 from the offering to repurchase a portion of its outstanding 9% Convertible Notes in privately-negotiatedtransactions, and to pay all related fees and expenses. The Company expects to use any remaining net proceeds from the offering for general corporatepurposes including, without limitation, the repayment of a portion of its liquidity facility.

In connection with the issuance of the 3.375% Convertible Notes the Company also entered into privately negotiated convertible bond hedge andwarrant transactions. The convertible bond hedge transactions cover, subject to anti-dilution adjustments, approximately 32,835,758 shares of the Company'sCommon Stock, which is the same number of shares initially issuable upon conversion of the 3.375% Convertible Notes, and are expected to reduce thepotential dilution with respect to the Common Stock and/or reduce the Company's exposure to potential cash payments that may be required to be made by theCompany upon conversion of the 3.375% Convertible Notes. The warrant transactions cover the same initial number of shares of Common Stock, subject toanti-dilution adjustments with each of the counterparties. The warrants have an initial strike price equal

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to $13.0725, or 75% above the closing price of the Common Stock on the New York Stock Exchange on July 28, 2011. The Company may, subject to certainconditions, settle the warrants in cash or on a net-share basis. The warrant transactions could have a dilutive effect with respect to the Common Stock or, if theCompany so elects, obligate the Company to make cash payments or issue additional shares of Common Stock to the extent that the market price per share ofCommon Stock exceeds the applicable strike price of the warrant transactions on or before any expiration date of the warrants.

The Company used approximately $25,162 of the net proceeds from the offering of the 3.375% Convertible Notes to pay the purchase price of theconvertible bond hedges. Such cost was partially offset by the aggregate proceeds of approximately $60,574 to the Company from the sale of the warrants,with the net cost to be recorded in Equity on the consolidated balance sheet. The convertible bond hedge transactions and the warrant transactions are separatetransactions, each entered into by the Company with the counterparties, are not part of the terms of the 3.375% Convertible Notes, and will not change anyholders' rights under the 3.375% Convertible Notes. Holders of the 3.375% Convertible Notes will not have any rights with respect to the convertible bondhedge transactions or warrant transactions.

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FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements that are based on the Company's present beliefs and assumptions and on information currentlyavailable to the Company. You can identify forward-looking statements by terminology such as "may", "will", "should", "could", "would", "targets", "goal","expect", "intend", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", or the negative of these terms or other comparableterminology. These statements relate to future events or the Company's future financial performance and involve known and unknown risks, uncertainties andother factors that may cause the Company's actual results, levels of activity, performance or achievements to differ materially from those expressed or impliedby these forward-looking statements. There are important factors that could cause the Company's actual results, levels of activity, performance orachievements to differ materially from the results, levels of activity, performance or achievements expressed or implied by the forward-looking statements. Inparticular, you should consider the risks and uncertainties described under "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for thefiscal year ended March 31, 2011. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, theCompany cannot guarantee future results, levels of activity, performance or achievements. The Company cautions you not to place undue reliance on theseforward-looking statements. Forward-looking statements in this report include, but are not limited to, statements about:

• expectations regarding the business environment in which the Company operates and the trends in its industry such as changes in trading volumesand interest rates;

• its liquidity requirements and its ability to obtain access to necessary liquidity;

• its ability to execute its business strategy and strategic plan;

• its planned transition of its business from a broker into a commodities and capital markets focused investment bank;

• fluctuations in interest rates and currency exchange rates and their possible effects on its business;

• its ability to continue to provide value-added brokerage services;

• its ability to maintain trading volumes and market share;

• its ability to continue to diversify its service offerings;

• its ability to pursue opportunities to improve operating margins or profitability;

• its ability to expand its business in existing or new geographic regions;

• its ability to continue to expand its business through acquisitions or organic growth;

• the effects of pricing and other competitive pressures on its business as well as its perceptions regarding its business' competitive position;

• its accuracy regarding its expectations of its revenues and various costs and of expected cost savings;

• exposure to client and counterparty default risks as well as the effectiveness of its risk management;

• exposure to market issuer default and other risks from its principal transactions;

• its exposures to credit, counterparty, and concentration risk;

• its ability to maintain its credit rating and the effects that changes to its credit ratings would have on its business and operations;

• its ability to retain existing clients and attract new ones;

• its ability to retain its management team and other key employees;

• the likelihood of success in, and the impact of, litigation or other legal or regulatory challenges involving its business;

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• the impact of any changes in domestic and foreign regulations or government policy, including any changes or reviews of previously issuedregulations and policies;

• changes in exchange membership requirements;

• changes in its taxes and tax rate;

• its ability to maintain its existing technology systems and to keep pace with technological developments; and

• the effects of financial reform legislation and related rule making of regulatory agencies.

The Company cautions that you should not place undue reliance on any of its forward-looking statements. Further, any forward-looking statementspeaks only as of the date on which it is made. New risks and uncertainties arise from time to time, and it is impossible for the Company to predict thoseevents or how they may affect the Company. Except as required by law, the Company has no duty to, and does not intend to, update or revise the forward-looking statements in this report after the date of this report.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to help you understandMF Global Holdings Ltd. and its consolidated subsidiaries (the "Company", "its" or "itself"). The Company's MD&A should be read in conjunction with itsunaudited consolidated financial statements and the accompanying notes, included elsewhere in this Quarterly Report on Form 10-Q.

Business Overview

The Company is one of the world's leading brokers in markets for commodities and listed derivatives. The Company provides access to more than 70exchanges globally and is a leader by volume on many of the world's largest derivatives exchanges. The Company is also an active broker-dealer in marketsfor commodities, fixed income securities, equities, and foreign exchange. The Company is one of 20 primary dealers authorized to trade U.S. governmentsecurities with the Federal Reserve Bank of New York. In addition to executing client transactions, the Company provides research and market commentaryto help clients make trading decisions as well as clearing and settlement services. The Company is also active in providing client financing and securitieslending services.

The Company is headquartered in the United States, and has operations globally, including in the United Kingdom, Australia, Singapore, India, Canada,Hong Kong and Japan, as well as other countries. The Company's diversified global client base includes a wide range of institutional asset managers andhedge funds, professional traders, corporations, sovereign entities, and financial institutions. The Company also offers a range of services for individualtraders and introducing brokers.

The Company has organized its business on a global basis to offer clients an extensive array of products across a broad range of markets andgeographies. The Company seeks to tailor its offerings from market to market to meet the demands of its clients by providing the most compelling productsand services possible, while remaining within the regulations of a particular jurisdiction. The Company executes transactions for a large and diverse group ofinstitutional and retail clients, including broker-dealers and other financial institutions, corporations, hedge funds and other asset managers, governmententities and sovereign institutions, and professional traders, and it also provides a number of prime services, including clearing, settlement and portfolioreporting and record-keeping services. The Company provides its execution services for five broad categories of products, consisting of commodities,equities, fixed income, foreign exchange, and listed futures and options. The Company also provides financing and securities lending services and other primeservices to select clients, including a number of other broker-dealers. The Company operates and manages its business as a single operating segment. TheCompany does not manage its business by services or product lines, market types, geographic regions, client segments or any other exclusive category. Asmanagement continues to implement its strategy to reorganize the Company's business model into the four lines of business discussed below, the Companymay change its reporting and disclosures in the future to reflect any changes to its business.

As discussed below under "—Significant Business Developments—The Company's Strategic Plan," the Company began, in fiscal 2011, the process oftransforming into a commodities and capital markets—focused investment bank. As part of this change, the Company anticipates that principal transactionsrevenue both from revenue generated as part of its developing market making and client facilitation business, as well as revenue generated from proprietaryactivities will increase, both in absolute size and as a percentage of its total revenue. The Company's strategic plan and, in particular, the increasing amount ofthe principal transactions activities the Company engages in—both as to market making and client facilitation as well as proprietary activities—will changethe level of market risk to which the Company is exposed. See "Item 1A. Risk Factors," in the Annual Report on Form 10-K and "—Liquidity and CapitalResources," and "Item 3. Qualitative and Quantitative Disclosures about Market Risk—Market Risk" for further information.

The Company derives revenues from three main sources: (i) commissions generated from execution and clearing services; (ii) principal transactionsrevenue, generated both from client facilitation and proprietary

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activities, and (iii) net interest income from cash balances in client accounts maintained to meet margin requirements as well as interest related to itscollateralized financing arrangements and principal transactions activities.

The total volume of exchange-traded futures and options the Company executed and/or cleared increased 9.6% to 575.1 million contracts in the threemonths ended June 30, 2011 from 524.7 million contracts in the three months ended June 30, 2010. This is as a result of improved global market conditionsand increased client activity driven by the volatility in the currency and commodities markets and uncertainty in global markets specifically Europe and Japan.In addition, because the Company has been focused on increasing the size of its clearing business, its mix of trading volume has continued to be weightedmore towards clearing transactions. For a discussion of the manner in which the Company calculates its volumes, see "—Factors Affecting the Company'sResults—Trading Volumes and Volatility".

Significant Business Developments


On August 2, 2011, the Company completed an offering of $325.0 million aggregate principal amount of its 3.375% Convertible Senior Notes due 2018(the "3.375% Convertible Notes"). The Company also granted to its underwriters, at pricing, a 30-day option to purchase an additional $45.0 million principalamount of the 3.375% Convertible Notes. This additional purchase option will carry the same terms as the original offering. The 3.375% Convertible Notesbear interest at a rate of 3.375% per year, payable semi-annually in arrears on February 1 and August 1 of each year, beginning February 1, 2012 and matureon August 1, 2018. Holders may convert the 3.375% Convertible Notes at their option prior to February 1, 2018 upon the occurrence of certain events relatingto the price of the Company's Common Stock or various corporate events. On or after February 1, 2018, the holders may convert at the applicable conversionrate at any time prior to the second scheduled trading day prior to maturity. The initial conversion rate for the 3.375% Convertible Notes is 101.0331 shares ofCommon Stock per one thousand principal amount of 3.375% Convertible Notes, equivalent to an initial conversion price of approximately $9.90 per share ofCommon Stock. The conversion rate will be subject to adjustment upon the occurrence of certain events. The Company may not redeem the notes prior tomaturity. The Company used $25.2 million proceeds from the offering to fund the cost of entering into the convertible note hedge and warrant transactionsdescribed below. The Company also used approximately $130.6 million from the offering to repurchase a portion of its outstanding 9% Convertible Notes inprivately-negotiated transactions, and to pay all related fees and expenses. The Company expects to use any remaining net proceeds from the offering forgeneral corporate purposes including, without limitation, the repayment of a portion of its liquidity facility.

In connection with the issuance of the 3.375% Convertible Notes the Company also entered into privately negotiated convertible bond hedge andwarrant transactions. The convertible bond hedge transactions cover, subject to anti-dilution adjustments, approximately 32,835,758 shares of the Company'sCommon Stock, which is the same number of shares initially issuable upon conversion of the 3.375% Convertible Notes, and are expected to reduce thepotential dilution with respect to the Common Stock and/or reduce the Company's exposure to potential cash payments that may be required to be made by theCompany upon conversion of the 3.375% Convertible Notes. The warrant transactions cover the same initial number of shares of Common Stock, subject toanti-dilution adjustments with each of the counterparties. The warrants have an initial strike price equal to $13.0725, or 75% above the closing price of theCommon Stock on the New York Stock Exchange on July 28, 2011. The Company may, subject to certain conditions, settle the warrants in cash or on a net-share basis. The warrant transactions could have a dilutive effect with respect to the Common Stock or, if the Company so elects, obligate the Company tomake cash payments or issue additional shares of Common Stock to the extent that the market price per share of Common Stock exceeds the applicable strikeprice of the warrant transactions on or before any expiration date of the warrants.

The Company used approximately $25.2 million of the net proceeds from the offering of the 3.375% Convertible Notes to pay the purchase price of theconvertible bond hedges. Such cost was partially offset by

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the aggregate proceeds of approximately $60.6 million to the Company from the sale of the warrants, with the net cost to be recorded in Equity on theconsolidated balance sheet. The convertible bond hedge transactions and the warrant transactions are separate transactions, each entered into by the Companywith the counterparties, are not part of the terms of the 3.375% Convertible Notes, and will not change any holders' rights under the 3.375% ConvertibleNotes. Holders of the 3.375% Convertible Notes will not have any rights with respect to the convertible bond hedge transactions or warrant transactions.

The Company's Strategic Plan

In fiscal 2011, senior management introduced and began implementing a new strategic direction for the Company. Under its new strategic plan, theCompany intends to transform its business from a broker to a commodities and capital markets focused investment bank during the next three to five years.

The Company has assessed the opportunities in the marketplace and is reshaping itself to take advantage of several trends in the market for financialservices. For example, the financial services industry continues to consolidate and the largest global investment banks and brokerage firms have increasedtheir scale of operations, while at the same time new and proposed regulations and other trends have forced global banks to de-leverage and reduce risks ontheir balance sheets. The Company believes that one result of these developments is that large investment banks have focused their attention, energy andcapital on their largest clients, creating opportunities for the Company to service smaller and mid-sized clients that are currently overlooked by larger firms.

The Company's strategic plan is designed to leverage its strengths, including its heritage and expertise in commodities trading and its broad globalfootprint. The Company's plan includes reorganizing its business into the following four categories in the short to medium term:

Capital Markets

The Company provides institutional clients with access to, liquidity in, and insight into commodities, equities, fixed income and foreign exchange, aswell as futures and options markets. The Company will build on its strong position in the brokerage business by deepening its involvement in certain markets,by extending its involvement as a principal on a proprietary basis as well as to facilitate more of its client's transactions and widening its range of services.Although the Company historically has frequently taken a principal position to facilitate clients complete trades and began to increasingly trade for its ownaccount since fiscal 2011, the Company intends to expand its role in market making and principal trading, and to use its capital to trade on a proprietary basis.In fiscal 2011 the Company established a principal strategies group and expanded its principal trading activities. Over the longer term, the Company intends tocomplement this expanded role in principal trading by participating in other elements of traditional investment banking, including underwriting new issues ofsecurities, structuring trades and providing advisory services to issuers, with a continuing focus on the commodities and natural resources markets.

Retail Services

The Company has developed a substantial retail business, built through the acquisition and development of retail businesses in various markets, andwhich offer assorted products under several brand names. The Company has now initiated the process of transforming these activities into a consolidated,centrally managed, global business operating under a unified global brand. The Company will continue to focus on high net worth individuals, self-directedtraders, individual traders seeking broker assistance and introducing brokers. The Company plans to develop an integrated platform on which clients canpursue their trading and investing objectives in a broad range of markets, instruments and currencies through an efficient, single point of access. TheCompany believes that delivering a unified global platform, broad product offerings and worldwide market connectivity will differentiate the Company frommany of its competitors in the retail space.

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Prime Services

The Company intends to undertake a substantial realignment of its clearing and financing activities to further diversify the Company's revenue streams.In this area, the Company intends to consolidate its management focus to take advantage of its scalable infrastructure to deliver solutions to clients. TheCompany believes that clearing services are increasingly attractive to a substantial number of clients underserved by large global banks and firms that wouldprefer to outsource these activities rather than make the extensive capital investments required to self-clear. As financial services regulatory reform placesincreased emphasis on centralized clearing, the Company believes that it has the capabilities to meet expanding demand for global clearing expertise.Furthermore, the Company believes that it is well positioned to grow its clearing services activities, given its global footprint on more than 70 exchangesaround the world and its extensive experience providing clearing solutions to clients in a variety of asset classes.

Asset Management

In the future, the Company intends to diversify its revenue base and generate fee income by providing clients with access to managed products throughan asset management business. The Company intends to examine strategic opportunities to develop an asset management capability that leverages its corecompetencies in commodities trading. There has been growing investor interest in alternative investment vehicles, and the Company believes this arearepresents an important opportunity for itself. Over time, the Company intends to leverage its skills and its brand to build a family of alternative investmentvehicles.

Restructuring

During the first quarter of fiscal 2011, the Company completed a critical assessment of its cost base, including reviews of its compensation structureand non-compensation expenses and as a result of this evaluation, the Company reduced its workforce by 12%. In addition, in the fourth quarter of fiscal2011, management announced a new strategic business model which required the realignment of existing resources, and as a result the Company furtherreduced its headcount by 6%. As a result of these plans, the Company recorded restructuring charges of $2.1 million and $9.9 million during the three monthsended June 30, 2011 and 2010, respectively. For the three months ended June 30, 2011 these charges, related to the office closures in the fourth quarter offiscal 2011, include $1.9 million for severance and other employee compensation costs and $0.2 million for contract termination costs related to officeclosures. The employee terminations occurred mainly in North America and Europe. During the first quarter of fiscal 2012, the Company paid approximately$4.7 million in restructuring costs and has a remaining accrual of $0.3 million as of June 30, 2011, substantially all of which will be paid out within one year.Although the Company has reduced headcount overall, it has also strategically hired personnel to complete the implementation of its new business model.

As management continues to implement the Company's strategic plan, management will continue to evaluate the Company's businesses, globalfootprint and the resources the Company allocates versus the returns it generates on these resources. In connection with the implementation of its strategicplan, and as a result of management's continuing evaluation of the Company's businesses, management currently expects to incur future additionalrestructuring charges of between $15.0 million to $30.0 million in the second fiscal quarter, although no assurance can be made that all of these charges willtake place this quarter nor that these charges will be within management's estimated range. The estimate of the size of future additional restructuring chargesin the second quarter takes into account many factors that cannot be easily quantified, including the length of time it will take to effect the actions that willultimately require a restructuring charge and the likely response of third parties to the Company's actions.

Factors Affecting the Company's Results

The global business environment directly affects the Company's results of operations. The Company's results of operations have been and will continueto be affected by many factors, including economic, political

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and market conditions, broad trends in the brokerage and finance industry, changes in the level of trading activity in the broader marketplace, price levels andprice volatility in the derivatives, interest rate, equity, foreign exchange and commodity markets, legislative and regulatory changes and competition, amongother factors. Specifically, the Company's business has been impacted by turmoil in global markets during fiscal 2010 and improvement in certain financialmarkets during fiscal 2011, although these improvements have not continued into the first quarter of fiscal 2012. Financial markets have experienced elevatedlevels of volatility due to concerns about the outlook for global growth, the solvency of certain European sovereign nations and inflation. Mortgage andcorporate credit spreads widened in the first quarter of fiscal 2012, and the U.S. dollar appreciated against the Euro and British pound in the first quarter offiscal 2011, before depreciating in the remainder of fiscal 2011 and in the first quarter of fiscal 2012. Furthermore, short-term interest rates have remainedvery low over the past year, and as a result the Company's net interest income has been negatively affected over the same period. All of these factors havecontributed to the Company's results for the periods presented. The Company's revenues are dependent on the volume of client transactions it executes andclears and the volatility in the principal markets in which the Company operates, as well as prevailing interest rates, each of which are described below.

Trading Volumes and Volatility

The Company's trading volumes are particularly dependent on its clients' demand for exchange-traded and OTC derivative products, which relate tointerest rates, equities, foreign exchange and commodities. Demand for these products is driven by a number of factors, including the degree of volatility ofthe market prices of the underlying assets—that is, the extent to which and how rapidly those prices change during a given period. Historically, higher pricevolatility increases the need for certain clients to manage price risk and creates opportunities for speculative trading for others. Although higher pricevolatility does not necessarily lead to increases in trading volumes, changes in the absolute price levels of financial assets or commodities can have asignificant impact on trading volumes. During times of significant economic and political disruptions, clients may seek to manage their exposure to, orspeculate on, market volatility. However, as was seen in the recent past, extreme volatility and widespread uncertainly can impact the Company's clients'ability to take on or maintain positions, which has the effect of decreasing volumes.

In addition to affecting trading volumes of exchange-traded and OTC derivative products, moderate to high levels of volatility can affect the Company'smarket making and client facilitation business, as the Company's clients either seek more risk exposure or limit their risk exposure at such levels.Furthermore, volatility in markets may also create investment and trading opportunities for the Company's principal strategies group.

The total volume of exchange-traded futures and options transactions the Company executed and/or cleared increased 9.6% to 575.1 million contractsin the three months ended June 30, 2011 from 524.7 million contracts in the three months ended June 30, 2010. All volume statistics presented herein for thethree months ended June 30, 2011 and 2010 include exchange-traded futures and options contract volumes as derived from the Company's reporting systems,excluding intercompany volumes. The Company is continuing to enhance its reporting systems in order to improve the analysis of operating data generated byits business.

Interest

The Company's net interest income, calculated as interest income less interest expense, is directly affected by the spread between interest rates theCompany pays its clients on their account balances and the interest the Company earns from cash balances it holds as well as the duration of the portfolio ofclient balances invested. Client balances can be impacted by a variety of market factors, including changes in margin requirements at exchanges, marketvolatility, declining asset values, as well as changes in the composition of margin. Clients, for example, may elect to deposit securities, rather than cash, asmargin, which will result in a reduction in the Company's client balances because the securities deposited as margin are not carried on the Company's balancesheet. As a result of these market factors, client balances fluctuate, often significantly, from day to day and may not be indicative of future business.

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The Company's net interest income is also directly affected by interest earned in connection with principal transactions, such as fixed income, securitieslending and collateralized financing transactions. While spreads on these transactions remained within a relatively constant range over time, they can widen ornarrow when interest rate trends change, as was seen in the slight widening of spreads during early fiscal 2011. Accordingly, the Company carefully monitorsand seeks to economically hedge its risk exposure as appropriate. In addition, a smaller portion of the Company's interest income relates to client balances onwhich it does not pay interest and thus is directly affected by the absolute level of interest rates. As a result, the Company's net interest income is impacted bythe level and volatility of interest rates, as well as the duration of its portfolio investments made with client balances. Any fair value adjustments to theinvestments in which client balances are invested are not included in interest but presented in Principal transactions, although they form part of the return onclient balances. Included within interest income is the interest the Company earns on its excess cash. The Company's interest on borrowings is also affected bychanges in interest rates, which could increase or decrease its interest expense on its variable rate debt. Accordingly, the historically low interest rates havenegatively affected the Company's net interest income and it cannot offer any assurance that interest rates will increase in the future. As the Companytransforms itself into a full-service broker-dealer and eventually an investment bank, it expects that the proportion of its net interest income earned inconnection with principal transactions will increase relative to the interest the Company earns from its clients' cash balances.

Results of Operations

Basis of Presentation

The Company operates and manages its business on an integrated basis as a single operating segment. The Company derives its revenues principallyfrom execution and clearing services it provides to its clients, including interest income related to providing these services, and from principal transactions.Although it provides these services to a diverse client base across multiple products, markets and geographic regions, it does not manage its business, allocateresources or review its operating results based on the type of client, product or trading market or the geographic region in which these services are provided.As management continues to implement its strategy to reorganize the Company's business model into the four lines of business, the reporting and disclosuresmade in the Company's financial statements may also change in the future to reflect the realignment of its business. For information related to the Company'sgeographic regions, see Note 16 to the unaudited consolidated financial statements.

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Three Months ended June 30, 2011 Compared to the Three Months ended June 30, 2010: Three months ended June 30,

(dollars in millions, except per share and share amounts) 2011 2010 % Change Revenues

Commissions $ 364.7 $ 376.6 (3.2)% Principal transactions 116.8 66.3 76.2 Interest income 122.2 114.2 7.0 Other 7.6 11.9 (36.1)

Total revenues 611.2 569.1 7.4 Interest and transaction-based expenses:

Interest expense 41.6 45.4 (8.4) Execution and clearing fees 186.5 175.2 6.4 Sales commissions 68.7 59.0 16.4

Total interest and transaction-based expenses 296.7 279.7 6.1 Revenues, net of interest and transaction-based expenses 314.5 289.4 8.7

Expenses Employee compensation and benefits (excluding non-recurring IPO awards) 171.1 155.4 10.1 Employee compensation related to non-recurring IPO awards — 8.6 (100.0) Communications and technology 39.1 31.4 24.5 Occupancy and equipment costs 16.0 11.1 44.1 Depreciation and amortization 10.3 10.5 (1.9) Professional fees 24.0 18.1 32.6 General and other 22.1 19.5 13.3 Restructuring charges 2.1 9.9 (78.8) Impairment of goodwill 0.7 0.8 (12.5)

Total other expenses 285.4 265.3 7.6 Gains on exchange seats and shares 2.2 2.0 10.0 Interest on borrowings 13.8 9.5 45.3

Income before provision for income taxes 17.6 16.6 6.0 Provision for income taxes 4.8 8.1 (40.7) Equity in income of unconsolidated companies (net of tax) 0.8 0.6 33.3

Net income 13.6 9.1 49.5 Net income attributable to noncontrolling interest (net of tax) 0.3 0.2 50.0

Net income attributable to MF Global Holdings Ltd. $ 13.3 $ 8.8 51.1

Earnings per share: Basic $ 0.05 $ 0.01 Diluted $ 0.05 $ 0.01

Weighted average number of shares of common stock outstanding: Basic 164,272,690 130,196,655 Diluted 164,293,357 133,999,818

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Overview

Revenues, net of interest and transaction based expenses ("net revenues"), increased $25.1 million, or 8.7%, to $314.5 million for the three monthsended June 30, 2011 from $289.4 million for the three months ended June 30, 2010. The table below provides an analysis of net revenues based on howmanagement views the business, which the Company believes is a more accurate representation of its sources of revenue and which is discussed in greaterdetail below:

For the three months endedJune 30,

2011 2010 Commissions, net of execution and clearing fees $ 178.2 $ 201.4 Principal transactions and related net interest revenue 150.0 87.4 Net revenues from client payables and excess cash 47.4 47.7 Sales commissions (68.7) (59.0) Other revenue 7.6 11.9

Revenues, net of interest and transaction-based expenses $ 314.5 $ 289.4

The increase in net revenues was primarily due to the expansion of client facilitation and principal activities, as reflected in the $62.6 million increase inprincipal transactions and related net interest revenue. The increase in principal transactions was driven primarily by (i) a $36.7 million increase in revenuesgenerated from certain repurchase transactions accounted for as sales, as well as (ii) a $42.6 million increase in structured equity trades revenue. Theseincreases were partially offset by decreases in foreign exchange, equities and commodities transactions of $12.7 million. The increase in net revenues waspartially offset by a $23.2 million decrease in commissions, net of execution and clearing fees, a $9.7 million increase in sales commissions, a $4.3 milliondecrease in other revenues and a $0.3 million decrease in net revenues from client payables and excess cash.

The decrease in commissions, net of execution and clearing fees, was due to a decrease in commissions on equity transactions, commodities and futuresand options trading, partially offset by an increase in introducing broker volumes, primarily in Europe. Despite the decrease in commissions, the Companyexperienced a 9.6% increase in its total volumes of executed and/or cleared exchange-traded futures and option transactions to 575.1 million contracts for thethree months ended June 30, 2011 from 524.7 million contracts for the three months ended June 30, 2010, due to higher clearing volumes and high volume,low margin customers in the European region. The increase of 50.4 million contracts in the Company's total volumes of executed and/or cleared exchange-traded futures and option transactions was spread across many of its primary products, markets and geographic regions, but was primarily due to increasedclearing of transactions.

Other expenses, which refer to expenses other than interest and transaction-based expenses, increased $20.1 million, or 7.6%, to $285.4 million for thethree months ended June 30, 2011 from $265.3 million for the three months ended June 30, 2010. The increase was primarily due to an increase of $15.7million in employee compensation and benefits (excluding non-recurring IPO awards), which was the result of increased net revenues and the continuedimplementation of the Company's strategic plan. The increase in Other expenses was also attributed to (i) an increase of $7.7 million in communications andtechnology costs, (ii) an increase of $5.9 million in professional fees, (iii) an increase of $4.9 million in occupancy and equipment costs, and (iv) an increasein general and other expenses of $2.6 million. These increases for the three months ended June 30, 2011 were partially offset by a reduction of $8.6 million ofstock-based compensation expense on equity awards issued in connection with the completion of the Company's IPO, a reduction of $7.8 million related torestructuring charges, a reduction of $0.2 million in depreciation and amortization and a reduction of $0.1 million in impairment of intangible assets andgoodwill.

Income before provision for income taxes increased $1.0 million to $17.6 million for the three months ended June 30, 2011 from $16.6 million for thethree months ended June 30, 2010. This was primarily due to

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increased net revenues as detailed above, partially offset by increased other expenses. The increase in income before provision for income taxes, was partiallyoffset by an increase of $4.3 million in interest on borrowings.

Net income increased $4.5 million to $13.3 million for the three months ended June 30, 2011 from $8.8 million for the three months ended June 30,2010. Net income is impacted by the items discussed above, plus a decrease in the effective tax rate resulting from (i) decreased gross unrecognized taxbenefits as a result of decisions in certain tax cases being resolved favorably, (ii) the impact of the Company's share price on the value of vested equitycompensation, and (iii) changes in the relative percentage of expected profits and losses being earned in higher tax jurisdictions.

Revenues

Commissions

Commissions decreased $11.9 million, or 3.2%, to $364.7 million for the three months ended June 30, 2011 from $376.6 million for the three monthsended June 30, 2010. The decrease was primarily due to a decrease in revenue from equity transactions, commodities and trading in futures and options.Although the Company experienced a decrease in commissions, its total volumes of executed and/or cleared exchange-traded futures and options transactionsincreased 9.6% to 575.1 million contracts for the three months ended June 30, 2011 from 524.7 million contracts for the three months ended June 30, 2010.Commissions consist of both execution-only and cleared commissions. The increase in the Company's transaction volumes was attributed primarily to highvolume, low margin customers in the European region executing increased levels of trades as well as a change in the composition of the Company's clientbase. Although the Company earns less per contract on clearing transactions than execution transactions, margins with respect to clearing transactions aregenerally higher than its margins with respect to execution transactions. Over the past several quarters, the Company has focused on increasing the size of itsclearing business, and it expects to continue maintaining this emphasis. At the same time, the Company has placed less emphasis on its execution-onlybusiness because even though revenue per contract may be higher, margins have historically tended to be lower because of higher compensation costs.

Principal Transactions

Principal transactions increased $50.5 million, or 76.2%, to $116.8 million for the three months ended June 30, 2011 from $66.3 million for the threemonths ended June 30, 2010. The table below provides an analysis of the components of principal transactions:


2011 2010 Principal transactions, excluding revenues from investment of client payables $ 121.4 $ 69.4 Principal transactions revenues from investment of client payables (4.6) (3.1)

Principal transactions $ 116.8 $ 66.3

The increase in principal transactions was attributable to a $52.0 million increase in principal transactions, excluding revenues from the investment ofclient payables. This $52.0 million increase was primarily due to a $72.3 million increase in fixed income and securities borrowing and lending revenue,partially offset by a $20.3 million decrease in matched principal transactions. Of the $72.3 million increase in fixed income and securities borrowing andlending revenues, $36.7 million was generated from certain repurchase transactions that mature on the same date as the underlying collateral. Thesetransactions are accounted for as sales and the Company de-recognizes the related liabilities from its consolidated balance sheets, recognizes a gain or loss onthe sale of the collateral assets, and records a forward repurchase commitment, in accordance with the accounting standard for transfers and servicing. Forthese specific repurchase transactions that are accounted for as sales, the Company maintains the exposure to the risk of default of the issuer of the underlyingcollateral assets, as well as

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exposures to margin calls, to the extent the value of the collateral decreases. These repurchase transactions will not result in additional revenues (but couldresult in credit losses) in future periods. For information about these forward repurchase commitments, see "—Off Balance Sheet Arrangements and Risk" and"Item 3. Quantitative and Qualitative Disclosures about Market Risk—Disclosures about Market Risk—Risk Management." The increase in principaltransactions revenue was also affected by a $42.6 million increase in structured equity trades revenue, which was partially offset by decreased revenuesearned in foreign exchange, equities and commodities markets. The volume of certain types of structured equity transactions vary by season, and accordinglyrevenue from structured equity transactions will not consistently be a large contributor to Principal transactions revenue.

Principal transactions do not reflect the net interest income earned from principal transactions and related financing transactions, which is included ininterest income and expense. The table below calculates total principal transactions revenue, including the net interest generated from financing transactionsrelated to principal transactions:


2011 2010 Principal transactions, excluding revenues from investment of client payables $ 121.4 $ 69.4 Net interest generated from principal transactions and related financing transactions 28.6 18.0

Principal transactions and related net interest revenue $ 150.0 $ 87.4

Net interest income earned from these principal transactions and related financing transactions was $28.6 million compared to $18.0 million for thethree months ended June 30, 2011 and 2010, respectively. When factoring in net interest income from principal transactions and related financingtransactions, which is how management views the business, principal transactions revenues increased $62.6 million to $150.0 million from $87.4 million forthe three months ended June 30, 2011 and 2010, respectively.

Principal transactions also include dividends earned and paid on equity positions the Company holds as hedges to equity futures contracts purchasedfrom customers through a central clearing counterparty. As the Company increases its client facilitation activities and engages in more proprietary transactionsas it continues to implement its new strategic plan, the Company's risk profile has and may continue to increase as it is exposed to more market and credit riskin certain areas. See "Item 3. Quantitative and Qualitative Disclosures about Market Risk" for further information.

Interest Income, Net

Interest income, net, increased $11.8 million, or 17.2%, to $80.6 million for the three months ended June 30, 2011 from $68.8 million for the threemonths ended June 30, 2010. This increase was due to an increase of $1.2 million in net interest generated from client payables and excess cash and anincrease of $10.6 million in net interest generated from principal transactions and related financing transactions. The table below provides an analysis of thecomponents of net interest income:


2011 2010 Net interest generated from client payables and excess cash $ 52.0 $ 50.8 Net interest generated from principal transactions and related financing transactions 28.6 18.0

Net interest income $ 80.6 $ 68.8

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Net interest generated from principal transactions and related financing transactions increased to $28.6 million for the three months ended June 30,2011 from $18.0 million for the three months ended June 30, 2010 driven by improved customer activity, and increasing net interest earned by the Company'sfixed income products, consisting of both repurchase and resale transactions and stock borrowing and lending activities. In addition, net interest generatedfrom client payables and excess cash increased to $52.0 million for the three months ended June 30, 2011 from $50.8 million for the three months endedJune 30, 2010 due to increasing yields earned through extending durations on the investment of client balances and the slight recovery of global interest rates.The table below calculates net revenues from client payables and excess cash:


2011 2010 Net interest generated from client payables and excess cash $ 52.0 $ 50.8 Principal transactions revenues from investment of client payables (4.6) (3.1)

Net revenues from client payables and excess cash $ 47.4 $ 47.7

Other Revenues

Other revenues decreased $4.3 million, or 36.1%, to $7.6 million for the three months ended June 30, 2011 from $11.9 million for the three monthsended June 30, 2010. Unlike the same period in fiscal 2011, when a one-time $3.8 million gain on investment in a limited partnership (which has since beensold) was recognized, there were no similar gains in fiscal 2012. Furthermore, compared to the same quarter in fiscal 2011, clearing services income receivedfrom clients and other counterparties for the use of equity research, as well as income from various trading systems, data and other professional staff andsupport services decreased. These decreases were partially offset by an increase in facilities management and other fees.

Transaction-based Expenses

Execution and Clearing Fees

Execution and clearing fees increased $11.3 million, or 6.4%, to $186.5 million for the three months ended June 30, 2011 from $175.2 million for thethree months ended June 30, 2010. This increase was primarily due to a 9.6% increase in the Company's volume of executed and/or cleared exchange-tradedfutures and options transactions to 575.1 million contracts for the three months ended June 30, 2011 from 524.7 million contracts for the three months endedJune 30, 2010. During the three months ended June 30, 2011, the Company experienced increased transaction volumes spread across many of its primarymarkets, products and geographic regions except for futures and options and equities. The Company's execution and clearing fees are not fixed, but instead arecalculated on a per-contract basis, and vary based on the market on which transactions are executed and cleared. Not all transactions that generate execution-only revenue generate corresponding execution or clearing fees, while some matched principal transactions do. Included within execution and clearing feesare losses due to transactional errors, which increased slightly to 0.6% of net revenues for the three months ended June 30, 2011 from 0.5% of net revenuesfor the three months ended June 30, 2010.

Sales Commissions

Sales commissions increased $9.7 million, or 16.4%, to $68.7 million for the three months ended June 30, 2011 from $59.0 million for the three monthsended June 30, 2010. This increase was due to increased trading activity as a result of the volatility of certain markets. Though specific arrangements withintroducing brokers may vary, increased volumes from individual investor clients transacting through introducing brokers usually result in a proportionateincrease in commissions paid to those brokers. However, a large part of the Company's business is not generated by introducing brokers and, therefore, not allchanges to volumes result in a proportionate change to sales commissions.

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Other Expenses

Employee Compensation and Benefits (Excluding Non-Recurring IPO Awards)

These expenses refer to all employee compensation, including stock based compensation expense for equity instruments, but excluding restricted stockand restricted stock units issued in connection with the IPO, which are referred to as "IPO awards". Employee compensation and benefits (excluding IPOawards) increased $15.7 million, or 10.1%, to $171.1 million for the three months ended June 30, 2011 from $155.4 million for the three months endedJune 30, 2010. This increase was primarily due to higher net revenues and the hiring of additional personnel as a result of the newly implemented strategicplan which was not yet formulated last year.

Fixed compensation as a percentage of total employee compensation and benefits (excluding IPO awards) was 62.4% for the three months endedJune 30, 2011 compared to 62.6% for the three months ended June 30, 2010. Excluding severance costs, the ratio of fixed compensation as a percentage oftotal employee compensation and benefits (excluding IPO awards) was 62.5% for the three months ended June 30, 2011 compared to 62.7% for the threemonths ended June 30, 2010. Employee compensation and benefits (excluding IPO awards) as a percentage of net revenues increased to 54.4% for the threemonths ended June 30, 2011 from 53.7% for the three months ended June 30, 2010.

In December 2009, the U.K. government introduced legislation that imposed a 50% charge on certain discretionary bonus payments in excess of£0.025 million, made between December 9, 2009 and April 5, 2010 to U.K. employees within the financial services industry. This law was enacted in April2010 and during the three months ended June 30, 2010 the Company paid $3.0 million in respect of this tax. On December 17, 2010, the U.K.'s FinancialServices Authority published the final text of its revised Code of Practice on remuneration. Some of the Company's employees in the U.K. will be subject tothese rules, which will affect the form of remuneration these employees can receive. For example, for certain employees, the new remuneration code requiresthe establishment of an appropriate ratio of fixed to variable compensation and requires that at least 40% of variable remuneration must be deferred, rising to60% if variable remuneration exceeds £0.5 million. The Company is studying the new rules closely to assess their future impact upon its business.

Employee Compensation and Benefits Related to Non-Recurring IPO Awards

These expenses refer to stock-based compensation expense for restricted stock and restricted stock units issued in connection with the Company's IPO.These expenses are recorded under the guidance of ASC 718, Compensation- Stock Compensation, and also include other costs associated with the vesting ofthese awards. Employee compensation and benefits related to non-recurring IPO awards decreased $8.6 million, or 100.0%, for the three months endedJune 30, 2011. During fiscal 2011, all remaining restricted stock and restricted stock units issued in connection with the Company's IPO became fully vestedand the Company does not expect to incur further costs related to IPO awards in future periods.

Communications and Technology

Communications and technology expenses increased $7.7 million, or 24.5%, to $39.1 million for the three months ended June 30, 2011 from $31.4million for the three months ended June 30, 2010. This increase was due to increased market data, research and communications expenses, reflectingincreased client trades during the three months ended June 30, 2011 as compared to the three months ended June 30, 2010 as well as the expansion of equitiestrading in the U.S. and Asia Pacific region. This caption also includes software licenses and costs related to the Company's trading systems. Communicationsand technology, as a percentage of net revenues, increased to 12.4% for the three months ended June 30, 2011 from 10.9% for the three months endedJune 30, 2010.

Occupancy and Equipment Costs

Occupancy and equipment costs increased $4.9 million, or 44.1%, to $16.0 million for the three months ended June 30, 2011 from $11.1 million for thethree months ended June 30, 2010, primarily due to higher costs

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as a result of additional leased office space in New York, Japan and London. Occupancy and equipment costs, as a percentage of net revenues, increased to5.1% for the three months ended June 30, 2011 from 3.8% for the three months ended June 30, 2010.

Depreciation and Amortization

Depreciation and amortization decreased $0.2 million, or 1.9%, to $10.3 million for the three months ended June 30, 2011 from $10.5 million for thethree months ended June 30, 2010, primarily due to reduced amortization expense on intangible assets as a result of certain intangible asset impairmentsrelated to customer relationships recognized in fiscal 2011, partially offset by an increase in depreciation expense on fixed assets related to the reengineeringinitiatives. Depreciation and amortization, as a percentage of net revenues, decreased to 3.3% for the three months ended June 30, 2011 from 3.6% for thethree months ended June 30, 2010.

Professional Fees

Professional fees increased $5.9 million, or 32.6%, to $24.0 million for the three months ended June 30, 2011 from $18.1 million for the three monthsended June 30, 2010, primarily due to a $5.0 million increase in consulting fees and a $2.2 million increase in other professional fees due to the continuedimplementation of the Company's strategic plan. These increases in professional fees were partially offset by a $1.3 million decrease in legal and audit fees.Professional fees, as a percentage of net revenues, increased to 7.6% for the three months ended June 30, 2011 from 6.3% for the three months ended June 30,2010.

General and Other

General and other expenses increased $2.6 million, or 13.3%, to $22.1 million for the three months ended June 30, 2011 from $19.5 million for thethree months ended June 30, 2010. This increase was primarily due to a $1.3 million increase in travel and entertainment expenses, a $1.7 million increase inother operating expenses, a $0.9 million increase in advertising expenses related to marketing and brand realignment and a $0.5 million increase in insurancepremiums. These increases were partially offset by a $1.0 million change in foreign currency transaction expenses, as reflected in a move to gains of $0.7million during the three months ended June 30, 2011 from losses of $0.3 million during the three months ended June 30, 2010 and a $0.8 million decrease inlegal reserves and settlements. General and other also includes bad debt expenses which decreased slightly to 0.02% of net revenues for the three monthsended June 30, 2011 compared to 0.03% for the three months ended June 30, 2010. General and other expenses, as a percentage of net revenues, increased to7.0% for the three months ended June 30, 2011 from 6.7% for the three months ended June 30, 2010.

Restructuring Charges

During the three months ended June 30, 2010, the Company completed a critical assessment of its cost base, including reviews of its compensationstructure and non-compensation expenses and as a result of this evaluation, reduced its workforce. Due to these restructuring activities, the Company incurredcosts of $9.9 million or approximately 3.4% of net revenues during the three months ended June 30, 2010. These costs consisted of severance expense andcontract termination costs related to office closures. In addition, during the fourth quarter of fiscal 2011, management announced a new strategic businessmodel which required the realignment of existing resources and further reduced headcount. Due to these restructuring activities, the Company incurredadditional costs of $2.1 million or approximately 0.7% of net revenues during the three months ended June 30, 2011. These costs also consisted of severanceexpense and contract termination costs related to office closures. In connection with the implementation of the strategic plan, and as a result of the Company'scontinuing evaluation of its businesses, the Company currently expects to incur future additional restructuring charges of between $15.0 million to $30.0million in the second quarter of fiscal 2012, although it can offer no assurance that all of these charges will take place that quarter nor that these charges willbe within the estimated range.

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Impairment of Goodwill

The Company recorded impairment charges of $0.7 million and $0.8 million, or approximately 0.2% and 0.3% of net revenues in the three monthsended June 30, 2011 and 2010, respectively. Based on the results of the Company's analyses, it determined that its market capitalization and the fair valuederived from its discounted cash flow model was less than the estimated fair value of its balance sheet and the Company wrote-off the entire amount of itsgoodwill. The Company has an earn-out arrangement that could result in additional goodwill being recorded in future periods and will continue to assess itsgoodwill annually or whenever events or changes in circumstances indicate that an interim assessment is necessary.

Gains on Exchange Seats and Shares

Gains on exchange seats and shares increased $0.2 million to $2.2 million for the three months ended June 30, 2011 from $2.0 million for the threemonths ended June 30, 2010. These gains are unrealized gains and the amounts recorded are based on the fair market value movements of the Company'sremaining excess seats and shares. Absent future demutualizations or changes in trading requirements, the Company does not expect to recognize materialamounts of gains on seats and shares in future periods.

Interest on Borrowings

Interest on borrowings increased $4.3 million, or 45.3%, to $13.8 million for the three months ended June 30, 2011 from $9.5 million for the threemonths ended June 30, 2010. This increase was primarily due to higher levels of outstanding debt driven by the issuance of 1.875% Convertible Notes in thefourth quarter of fiscal 2011, as well as an increase in facility fees resulting from the amendment of the liquidity facility in June 2010. These increases werepartially offset by lower interest payments on the reduced aggregate principal amount of outstanding 9% Convertible Notes as a result of an offer to exchangein the second quarter of fiscal 2011 and repurchases of the 9% Convertible Notes in the open market in the fourth quarter of fiscal 2011. The Companyexpects to continue to opportunistically repurchase its 9% Convertible Notes from time to time when holders offer these notes at prices that the Companydeems to be reasonable. In addition, the Company intends to continue using, from time to time, the liquidity facility for the purposes of prudent liquiditymanagement. Interest on borrowings, as a percentage of net revenues increased to 4.4% for the three months ended June 30, 2011 from 3.3% for the threemonths ended June 30, 2010.

Provision for Income Taxes

Income tax expense decreased $3.3 million to $4.8 million for the three months ended June 30, 2011 from $8.1 million for the three months endedJune 30, 2010. The Company's effective income tax rate was 27.6% for the three months ended June 30, 2011, as compared to 49.1% for the three monthsended June 30, 2010. The change in the effective tax rate results from (i) decreased gross unrecognized tax benefits as a result of decisions in certain tax casesbeing resolved favorably, (ii) the impact of the Company's share price on the value of vested equity compensation, and (iii) changes in the relative percentageof expected profits and losses being earned in higher tax jurisdictions. The Company's effective tax rate on ongoing operations (excluding discrete items) wasapproximately 37.0% for the three months ended June 30, 2011 compared to 33.1% for the three months ended June 30, 2010.

Supplementary Data

Repurchase Agreements

The table below presents the ending, average and maximum balance of repurchase agreements accounted for as collateralized financing transactions inthe quarterly period ended:

June 30,2011

March 31,2011

(in billions) Ending balance $ 18.0 $ 16.6 Quarterly average 19.7 20.3 Quarterly maximum 21.4 23.9

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The table below presents the amount, average and maximum of repurchase agreements qualifying for sales accounting in the quarterly period ended:

June 30,2011

March 31,2011

(in billions) Balances de-recognized $ 16.6 $ 14.5 Quarterly average 14.7 11.3 Quarterly maximum 16.6 14.5

As of June 30, 2011, the ending balance of the Company's repurchase agreements accounted for as collateralized financing transactions was $18.0billion, which was 8.6% lower than the quarterly average balance of repurchase agreements accounted for as collateralized financing transactions of $19.7billion. This difference is attributable to the seasonal maturity of client financing activity at quarter end as well as market conditions during this period,specifically the tightening and expansion of spreads in the cash and repurchase markets through the quarter. When there is less room for spreads between thetwo markets, there is less opportunity to take advantage of the anomalies in the market. The Company's average balance of repurchase agreements accountedfor as collateralized financing transaction has also decreased, as compared to the March 31, 2011 quarterly average, due to market conditions andmanagement's desire to allocate capital to other parts of the Company's business. The level of repurchase agreements also fluctuates between and withinperiods as part of client facilitation activities because the Company provides clients with access to highly liquid collateral, such as U.S. government, federalagency and sovereign obligations through collateralized financing activities.

As of June 30, 2011, the ending balance of the Company's repurchase agreements qualifying for sales accounting was $16.6 billion, which was 12.9%higher than the quarterly average balance of repurchase agreements qualifying for sales accounting of $14.7 billion. The difference is principally attributableto the Company's increased trading in repurchase agreements qualifying for sales accounting with respect to opportunities available in European sovereigndebt markets. Volatility in the European sovereign debt markets created occasional dislocations in the cash and repurchase markets for certain short datedsecurities, providing more trading opportunities in the quarter ending June 30, 2011.

Non-GAAP Financial Measures

In addition to the Company's unaudited consolidated financial statements presented in accordance with U.S. GAAP, the Company uses, both internallyas well as in some of its discussions with investors, certain non-GAAP financial measures of its financial performance for the reasons described further below.The presentation of these measures is not intended to be considered in isolation from, as a substitute for or as superior to, the financial information preparedand presented in accordance with U.S. GAAP, and its presentation of these measures may be different from non-GAAP financial measures used by othercompanies. In addition, these non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the Company's resultsof operations as determined in accordance with GAAP. The non-GAAP financial measures the Company uses are (1) non-GAAP adjusted income beforeprovision for income taxes, which the Company refers to as "adjusted income before taxes", (2) non-GAAP adjusted net income, which the Company refers toas "adjusted net income", (3) non-GAAP adjusted net income per adjusted diluted common share, which the Company refers to as "adjusted net income perfully diluted share", (4) non-GAAP adjusted employee compensation and benefits (excluding non-recurring IPO awards), and (5) non-GAAP adjusted non-compensation expenses. These non-GAAP financial measures currently exclude certain of the following items from the Company's unaudited consolidatedstatements of operations, each of which are discussed in greater detail below:

• Certain legal reserves, settlements and related expenses

• Restructuring charges

• Impairment of goodwill

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• Stock compensation expense related to IPO awards

• Severance expense

• U.K. bonus tax

• Gains on exchange seats and shares

The Company does not believe that these items are representative of its future operating performance from normal operations. In particular, theCompany excludes restructuring charges, stock compensation expense related to IPO awards and a U.K. bonus tax because the Company believes that theseitems reflect losses or expenses arising from particular events that are not reasonably likely to recur. In addition, the Company excludes severance expense,certain legal reserves, settlements and related expenses, gains on exchange seats and shares and impairment of goodwill because the Company believes thatthese gains and losses do not reflect its operating performance and can make it difficult for its shareholders to understand and compare the Company's past orfuture financial performance.

In addition, the Company may consider whether other significant items that arise in the future should also be excluded in calculating the non-GAAPfinancial measures used. The non-GAAP financial measures also take into account income tax adjustments with respect to the excluded items.

Certain Legal Reserves, Settlements and Related Expenses

The Company has excluded certain legal reserves, settlements and the related costs during the three months ended June 30, 2011 related to lawsuitsfiled by former German retail clients for losses incurred through introducing broker relationships. The Company does not believe that the reserves, settlementsand related expenses, which related solely to specific proceedings, are representative of its future performance from normal operations. Although theCompany has excluded certain legal reserves, settlements and related costs, its practice is to include in earnings all amounts that the Company is awarded inaffirmative litigation.

Restructuring Charges

During fiscal 2011, the Company completed a critical assessment of its cost base, including reviews of its compensation structure and non-compensation expenses as well as announcing a new strategic business model. As a result of these restructuring activities, the Company reduced its workforceand recorded restructuring charges of $2.4 million and $9.9 million during the three months ended June 30, 2011 and 2010, respectively, related to severance,the accelerated vesting of stock compensation expense related to these terminations and contract termination costs for office closures. At this time, theCompany anticipates potential further restructuring charges in the second quarter of fiscal 2012 as it continues to implement its new strategic plan. TheCompany does not believe that these costs are representative of its future performance from normal operations.

Impairment of Goodwill

During the three months ended June 30, 2011 and 2010 the Company identified triggering events that required an impairment analysis to be performedrelated to goodwill. Based on the results of its analyses, the Company determined that its market capitalization and the fair value derived from its discountedcash flow model was less than the estimated fair value of its balance sheet and the Company determined the entire amount of its goodwill was impaired. TheCompany will continue to assess its goodwill annually or whenever events or changes in circumstances indicate that an interim assessment is necessary. TheCompany does not believe that this expense is representative of its future performance from normal operations.

Stock Compensation Expense related to IPO Awards

The Company incurred stock based compensation expense during the three months ended June 30, 2010 for the restricted shares and restricted shareunits awarded to its employees in connection with the IPO. These costs were incurred solely because of its IPO, and as a result the Company does not believethat they are representative of its future performance from normal operations.

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Severance Expense

The Company incurred severance expense during the three months ended June 30, 2011 and 2010 related to payments made to employees inconjunction with employee termination, redundancy, separation and similar agreements. The Company does not believe that these costs are representative ofits future performance from normal operations.

U.K. Bonus Tax

In December 2009, the U.K. government introduced legislation that imposed a 50% charge on certain discretionary bonus payments in excess of£0.025 million made between December 9, 2009 and April 5, 2010 to U.K. employees within the financial services industry. During the three months endedJune 30, 2010, the Company paid $3.0 million in respect of this tax. The Company does not believe that this additional tax expense is representative of itsfuture performance from normal operations.

Gains on Exchanges Seats and Shares

The Company recognizes realized and unrealized gains or losses on exchange seats and shares that it holds in excess of the number of shares it needs toconduct its operations as an executing broker or clearing member. The amount of unrealized gain or loss recorded for each period is based on the fair marketvalue movements of these seats or shares, which can be highly volatile and subject to significant change from period to period. Since these assets are not anintegral part of the Company's business and normal operations, it believes that the use of a non-GAAP measure to exclude these gains is more meaningful toinvestors in understanding the Company's historical and future results of operations. Absent future demutualizations or changes in trading requirements, theCompany does not expect to recognize material amounts of gains on seats and shares in future periods.

The Company's use of non-GAAP Financial Measures

The Company uses certain non-GAAP financial measures internally to evaluate its operating performance and make financial and operational decisions.The Company believes that its presentation of these measures provides investors with greater transparency and supplemental data relating to its results ofoperations. In addition, the Company believes the presentation of these measures is useful for period-to-period comparison of results because (1) restructuringcharges, stock compensation expense related to IPO awards and a U.K. bonus tax described above do not reflect the Company's historical operatingperformance and (2) severance expense, certain legal reserves, settlements and related expenses, gains on exchange seats and shares and impairment ofgoodwill fluctuate significantly from period to period and are not indicative of the Company's core operating performance and, with respect to gains onexchange seats and shares, are not expected to be significantly realized in the future.

When viewed with its GAAP results and the accompanying reconciliation, the Company believes adjusted net income, adjusted income before taxes,adjusted net income per fully diluted share, adjusted employee compensation and benefits (excluding non-recurring IPO awards) and adjusted non-compensation expenses provide a more complete understanding of the factors affecting its business than GAAP measures alone. The Company believes thesefinancial measures enable it to make a more focused evaluation of its operating performance and management decisions made during a reporting period,because they exclude the effects of certain items that the Company believes have less significance in the day-to-day performance of its business. TheCompany's internal budgets and reporting are based on these financial measures which are communicated to its board of directors. In addition, these measuresare among the criteria used in determining performance-based compensation. The Company understands that analysts and investors often rely on non-GAAPfinancial measures, including per-share measures, to assess core operating performance, and thus may consider adjusted net income, adjusted income beforetaxes, adjusted net income per fully diluted share, adjusted employee compensation and benefits (excluding non-recurring IPO awards) and adjusted non-compensation expenses important in analyzing its performance going forward. These measures may be helpful in more clearly highlighting trends in itsbusiness that may not otherwise be apparent from GAAP financial measures alone.

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GAAP Reconciliation

The table below reconciles income before provision for income taxes (GAAP) to adjusted income before taxes (non-GAAP) and net income applicableto common shareholders (GAAP) to adjusted net income (non-GAAP), for the periods presented:


(in millions except per share data) 2011 2010 Income before provision for income taxes (unadjusted) $ 17.6 $ 16.6

Add: Certain legal reserves, settlements and related expenses 2.0 — Add: Restructuring charges 2.4 9.9 Add: Impairment of goodwill 0.7 0.8 Add: Stock compensation expense related to IPO awards — 8.6 Add: Severance expense 0.4 0.3 Add: U.K. bonus tax — 3.0 Less: Gains on exchange seats and shares (2.2) (2.0)

Adjusted income before taxes $ 20.9 $ 37.2

Net income applicable to common shareholders (unadjusted) $ 7.7 $ 0.8 Add: Certain legal reserves, settlements and related expenses 1.4 — Add: Restructuring charges 1.8 6.5 Add: Impairment of goodwill 0.4 0.5 Add: Stock compensation expense related to IPO awards — 6.4 Add: Severance expense 0.3 0.2 Add: U.K. Bonus Tax — 3.0 Less: Gains on exchange seats and shares (1.4) (1.2)

Add: Anti-dilutive impact of fully diluted number of shares(1) 9.3 12.2

Adjusted net income $ 19.5 $ 28.4

Adjusted net income per fully diluted share (2)

$ 0.10 $ 0.16 Fully diluted shares outstanding (in millions) 198.1 179.5 (1) The anti-dilutive impact of using a fully diluted number of shares requires adding back to net income applicable to common shareholders the

cumulative and participating dividends on the Company's Series A Preferred Stock and declared dividends on the Company's Series B Preferred Stock,as well as the interest and amortization of issuance costs on its 1.875% and 9% Convertible Notes, net of tax.

(2) Calculated by dividing adjusted net income by fully diluted shares outstanding.

The Company believes it is meaningful to investors to present adjusted net income per fully diluted share. Weighted average shares of common stockoutstanding are adjusted at June 30, 2011 and 2010 to include the impact of the Company's outstanding Series A Preferred Stock, Series B Preferred Stockand 9% Convertible Notes, on an if-converted basis. In addition, weighted average shares of common stock outstanding are also adjusted at June 30, 2010 toadd back shares underlying restricted stock and stock unit awards ("IPO awards") granted in connection with the Company's IPO which are not considereddilutive under U.S. GAAP and, therefore, not included in diluted shares of common stock outstanding. For the three months ended June 30, 2011 and 2010weighted average shares of common stock outstanding are adjusted as follows:


(shares in millions) 2011 2010 Weighted average shares of common stock outstanding 164.3 130.2

Series A Preferred Stock 12.0 12.0 Series B Preferred Stock 3.9 14.4 9.0% Convertible Notes 17.9 19.6 IPO Awards — 3.3

Fully diluted shares outstanding 198.1 179.5

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The Company believes it is meaningful to investors to present ratios based on fully diluted shares because it demonstrates the dilution that investors willexperience at the end of the three-year vesting period of the Company's IPO awards and when its Series A Preferred Stock, Series B Preferred Stock and 9%Convertible Notes are converted. It is also how the Company's management internally views dilution.

In addition to the above, the 1.875% Convertible Notes and related call spread overlay (purchased calls and sold warrants) may also impact DilutedEPS, a GAAP financial measure, and such impact is determined by application of the treasury stock method. Under this method, there is no impact to DilutedEPS until the Company's stock price exceeds the contractual conversion price of the 1.875% Convertible Notes, which is $10.37. At that time, thedenominator would be adjusted to include only the incremental shares required to settle the excess value over par of the 1.875% Convertible Notes uponconversion. While the purchased calls are designed to economically offset the dilutive effect of the 1.875% Convertible Notes, under U.S. GAAP the anti-dilutive effect of the purchased calls cannot be reflected in Diluted EPS until the instrument is settled. For the sold warrants, there is a dilutive impact once theCompany's stock price exceeds the strike price of $14.23, and such impact is measured under the treasury stock method assuming the proceeds from exercisedwarrants are used to repurchase outstanding shares.

The following table illustrates the U.S. GAAP based diluted impact from the 1.875% Convertible Notes and related call spread overlay under thetreasury stock method assuming the Company's stock price trades in the range of $10 to $30 per share: (in millions except stock price data) Average stock price during the period

$ 10.00 $ 12.50 $ 15.00 $ 20.00 $ 30.00

Weighted average shares of common stock outstanding 164.3 164.3 164.3 164.3 164.3 Dilutive impact of:

Convertible bond — 4.7 8.6 13.4 18.2 Purchased calls — — — — — Sold warrants — — 1.0 5.8 10.6

Total shares outstanding after dilution of 1.875% Convertible Notes 164.3 169.0 173.9 183.5 193.1

% dilution 0% 2.9% 5.8% 11.7% 17.5%

The Company also uses adjusted net income per fully diluted share, a non-GAAP financial measure, and has prepared the economic dilution impact ofthe 1.875% Convertible Notes and related call spread overlay. As mentioned above, the impact is determined by the application of the treasury stock methodand there is no impact to Diluted EPS (GAAP) until the Company's stock price exceeds the contractual conversion price of $10.37. At that time, thedenominator would be adjusted to include only the incremental shares required to settle the excess value over par of the 1.875% Convertible Notes uponconversion. For the related sold warrants, there is a dilutive impact once the Company's stock price exceeds the strike price of $14.23, and such impact is alsomeasured under the treasury stock method assuming the proceeds from exercised warrants are used to repurchase outstanding shares. In calculating adjustednet income per fully diluted share, the Company would also include the effect of the purchased calls upon settlement. The anti-dilutive impact of thepurchased calls would fully offset the dilutive impact of the 1.875% Convertible Notes.

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The following table illustrates the economic diluted impact reflected in the adjusted net income per fully diluted share from the 1.875% ConvertibleNotes and related call spread overlay under the treasury stock method assuming the Company's stock price trades in the range of $10 to $30 per share: (in millions except stock price data) Average stock price during the period:

$ 10.00 $ 12.50 $ 15.00 $ 20.00 $ 30.00

Fully diluted shares outstanding 198.1 198.1 198.1 198.1 198.1 Dilutive impact of:

Convertible bond — 4.7 8.6 13.4 18.2 Purchased calls — (4.7) (8.6) (13.4) (18.2) Sold warrants — — 1.0 5.8 10.6

Total shares outstanding after dilution of 1.875% Convertible Notes 198.1 198.1 199.1 203.9 208.7

% dilution 0% 0% 0.5% 2.9% 5.4%

The table below reconciles Employee compensation and benefits (excluding non-recurring IPO awards) to Adjusted employee compensation andbenefits (excluding non-recurring IPO awards) for the periods presented.


(dollars in millions) 2011 2010 Employee compensation and benefits (excluding non-recurring IPO awards) $ 171.1 $ 155.4 Less: Severance expense (0.4) (0.3) Less: Restructuring from the accelerated vesting of stock compensation expense (0.3) — Less: U.K. bonus tax — (3.0)

Adjusted employee compensation and benefits (excluding non-recurring IPO awards) $ 170.4 $ 152.1

The table below reconciles Non-compensation expenses to Adjusted non-compensation expenses for the periods presented.


(dollars in millions) 2011 2010 Non-compensation expenses $ 114.3 $ 101.3 Less: Restructuring charges (2.1) (9.9) Less: Certain legal reserves, settlements and related expenses (2.0) — Less: Impairment of goodwill (0.7) (0.8)

Adjusted non-compensation expenses $ 109.5 $ 90.6

Liquidity and Capital Resources

The Company has multiple sources of liquidity and expects its primary liquidity needs over the next 12 months to be for working capital, debt serviceobligations and preferred dividend obligations. Subject to the discussion below regarding its changing liquidity needs as a result of the implementation of itsstrategic plan, the Company believes it will have sufficient liquidity to meet these obligations given its expected cash flows from operations and its availablesources of liquidity. The Company's available sources of liquidity as of June 30,

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2011 included: (i) its committed $1,200.9 million unsecured revolving liquidity facility with various banks, which the Company refers to as its "liquidityfacility", of which $511.3 million terminates in June 2012 and $689.6 million terminates in June 2014, and under which it currently has $342.0 millionoutstanding and $858.9 million that is undrawn under this facility at June 30, 2011, (which includes $50.0 million drawn in May 2011 for the purposes ofprudent liquidity management); (ii) its U.S. regulated broker-dealer subsidiary's committed $300.0 million 364-day secured revolving credit facility, which theCompany refers to as its "MFGI secured facility"; (iii) available excess capital in its regulated subsidiaries, the withdrawal of which is subject to regulatoryapproval; and (iv) available excess cash held in the bank accounts of non-regulated subsidiaries. See "—Credit Facilities and Sources of Liquidity" for furtherinformation. In addition, the Company has customer collateral that is not included on its balance sheet but can be re-hypothecated by the Company, and non-segregated customer payables, both of which may be considered (depending, among other things, on where the collateral is located and the regulatory rulesapplicable to the collateral) an additional layer of liquidity. Non-segregated customer cash in certain jurisdictions is also available for other client liquiditydemands which helps mitigate the use of the Company's own cash. The Company also relies on uncommitted lines of credit from multiple sources to fund itsday-to-day execution and clearing operations.

On August 2, 2011, the Company completed an offering of $325.0 million aggregate principal amount of its 3.375% Convertible Senior Notes due 2018(the "3.375% Convertible Notes"). The Company also granted to its underwriters a 30-day option to purchase an additional $45.0 million principal amount ofthe 3.375% Convertible Notes. This additional purchase option will carry the same terms as the original offering. The 3.375% Convertible Notes bear interestat a rate of 3.375% per year, payable semi-annually in arrears on February 1 and August 1 of each year, beginning February 1, 2012 and mature on August 1,2018. Holders may convert the 3.375% Convertible Notes at their option prior to February 1, 2018 upon the occurrence of certain events relating to the priceof the Company's Common Stock or various corporate events. On or after February 1, 2018, the holders may convert at the applicable conversion rate at anytime prior to the second scheduled trading day prior to maturity. The initial conversion rate for the 3.375% Convertible Notes is 101.0331 shares of CommonStock per one thousand principal amount of 3.375% Convertible Notes, equivalent to an initial conversion price of approximately $9.90 per share of CommonStock. The conversion rate will be subject to adjustment upon the occurrence of certain events. The Company may not redeem the notes prior to maturity. TheCompany used $25.2 million proceeds from the offering to fund the cost of entering into the convertible note hedge and warrant transactions described below.The Company also used approximately $130.6 million from the offering to repurchase a portion of its outstanding 9% Convertible Notes in privately-negotiated transactions, and to pay all related fees and expenses. The Company expects to use any remaining net proceeds from the offering for generalcorporate purposes including, without limitation, the repayment of a portion of its liquidity facility.

In connection with the issuance of the 3.375% Convertible Notes the Company also entered into privately negotiated convertible bond hedge andwarrant transactions. The convertible bond hedge transactions cover, subject to anti-dilution adjustments, approximately 32,835,758 shares of the Company'sCommon Stock, which is the same number of shares initially issuable upon conversion of the 3.375% Convertible Notes, and are expected to reduce thepotential dilution with respect to the Common Stock and/or reduce the Company's exposure to potential cash payments that may be required to be made by theCompany upon conversion of the 3.375% Convertible Notes. The warrant transactions cover the same initial number of shares of Common Stock, subject toanti-dilution adjustments with each of the counterparties. The warrants have an initial strike price equal to $13.0725, or 75% above the closing price of theCommon Stock on the New York Stock Exchange on July 28, 2011. The Company may, subject to certain conditions, settle the warrants in cash or on a net-share basis. The warrant transactions could have a dilutive effect with respect to the Common Stock or, if the Company so elects, obligate the Company tomake cash payments or issue additional shares of Common Stock to the extent that the market price per share of Common Stock exceeds the applicable strikeprice of the warrant transactions on or before any expiration date of the warrants.

The Company used approximately $25.2 million of the net proceeds from the offering of the 3.375% Convertible Notes to pay the purchase price of theconvertible bond hedges. Such cost was partially offset by

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the aggregate proceeds of approximately $60.6 million to the Company from the sale of the warrants, with the net cost to be recorded in Equity on theconsolidated balance sheet. The convertible bond hedge transactions and the warrant transactions are separate transactions, each entered into by the Companywith the counterparties, are not part of the terms of the 3.375% Convertible Notes, and will not change any holders' rights under the 3.375% ConvertibleNotes. Holders of the 3.375% Convertible Notes will not have any rights with respect to the convertible bond hedge transactions or warrant transactions.

As the credit markets and the Company's financial position and business continue to evolve, the Company continually assesses its capital structure andevaluates opportunities to access capital markets to reposition or restructure, it including extending the maturities on its outstanding debt. In particular, theCompany's management has been considering the appropriate debt structure, for its business, as well as the level of preferred stock and convertible notes theCompany has outstanding. Factors that the Company's management considers with respect to any such repositioning or restructuring include rating agencyviewpoints, its growth strategy and strategy plan, adequacy of its permanent capital, attaining profitability in the near term, and the return on investment for itsshareholders. As a result, from time to time, the Company may repay existing debt, repurchase or exchange all or a portion of its preferred stock orconvertible notes for cash or other securities, or issue new debt or equity securities pursuant to its shelf registration statement or otherwise pursuant to privateofferings. The issuance of debt or equity securities will depend on future market conditions, funding needs and other factors and there can be no assurance thatany such issuance will occur or be successful. The Company believes that the issuance of the 3.375% Convertible Notes, as well as its announced intention,subject to market conditions, to actively pursue opportunities to raise additional capital through the sale of senior unsecured indebtedness, may improve manyof the foregoing factors.

Working Capital Needs

The Company's cash flows are complex, interrelated, and highly dependent upon its operating performance, levels of client activity and financingactivities. The Company views its working capital exclusive of non-earning assets and inclusive of its borrowings. The Company's working capital decreasedto $1,778.3 million as of June 30, 2011 from $1,785.7 million as of March 31, 2011 primarily due to an increase of $15.9 million in net assets and adrawdown of $50.0 million, offset by the partial repayment of $75.0 million on the liquidity facility.

As of June 30, 2011 and March 31, 2011, total working capital was calculated as follows:

(dollars in millions)

June 30,2011

March 31,2011

TOTAL ASSETS $ 45,929.7 $ 40,541.6 Less Non-earning assets:

Receivables—Other (1)

50.7 52.0 Memberships in exchanges, at cost 4.5 5.9 Furniture, equipment and leasehold improvements, net 151.7 138.4 Intangible assets, net 39.2 41.9 Other assets 279.0 277.4

Subtotal non-earning assets 525.1 515.6

Less Total liabilities: 44,409.5 39,037.3 Add Borrowings 783.2 797.0

TOTAL WORKING CAPITAL $ 1,778.3 $ 1,785.7

(1) Excludes trading related balances.

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The Company's primary requirement for working capital relates to funds the Company is required to maintain at exchanges and clearing organizationsto support its clients' trading activities. The Company requires that its clients deposit cash or collateral with the Company in support of their trading activities,which the Company in turn deposits with exchanges or clearing organizations to satisfy its obligations. These required deposits account for the majority of itsworking capital requirements. As discussed in Note 17 to its unaudited consolidated financial statements, the Company is subject to the requirements of theregulatory bodies and exchanges of which the Company or its subsidiaries by which the Company is regulated, of which it is a member or with which theCompany conducts business. The regulatory bodies and exchanges each have defined capital requirements the Company must meet on a daily basis. TheCompany was in compliance with all of these requirements at June 30 and March 31, 2011. For the purposes of prudential supervision, the Company as aconsolidated group is not subject to consolidated regulatory capital requirements under the European Union's Capital Requirements Directive.

The Company has satisfied its primary requirements for working capital in the past from internally generated cash flow, offering of Common Stock,issuance of convertible debt and other available funds. The Company believes that its current working capital is more than sufficient for its presentrequirements. In OTC or non-exchange traded transactions, the amount of collateral the Company posts is based upon its credit rating. Pursuant to its tradingagreements with certain liquidity providers, if its credit rating falls, the amount of collateral the Company is required to post may increase. Some of the factorsthat could lead to a downgrade in its credit rating have been described in reports issued by certain of the rating agencies, and these factors include, but are notlimited to, its profitability each quarter as compared against rating agency expectations, whether the Company suffers material principal losses, its ability tomaintain a conservative liquidity profile, its ability to maintain the value of its franchise, deterioration in its trading volumes or operating cash flows, itsability to implement its strategic plan, a decline in maintenance margin funds or excess capital levels at its regulated subsidiaries and increases in leverage.The Company maintains investment grade ratings from all three rating agencies.

Notwithstanding the self-funding nature of many of its operations, the Company may be required to fund timing differences arising from counterpartydefaults on large transactions due to futures, foreign exchange or securities failures or clients going to delivery without proper instructions or the delayedreceipt of client funds. Historically, these timing differences have been funded either with internally generated cash flow or, if needed, with short-termborrowings.

As discussed above, the Company relies on uncommitted lines of credit from multiple global sources to fund day-to-day clearing operations. If theselines of credit are not available to us, the Company may have to reduce its clearing business, which may negatively impact its revenues.

As a matter of policy, the Company maintains excess capital to provide liquidity during periods of unusual market volatility, which has been sufficienthistorically to absorb the impact of volatile market events. Similarly, for its brokerage activities in the OTC markets involving transactions when theCompany acts as principal rather than as agent, the Company has adopted a futures-style margin methodology to protect the Company against pricemovements. A futures-style margin methodology allows the Company to reduce the amount of capital required to conduct this type of business because theCompany is able to post client deposits, rather than its own funds, with clearing organizations or other counterparties, if required. In determining its requiredcapital levels, the Company also considers the potential for counterparty default on a large transaction, which would require liquidity to cover such default, ora settlement failure due to mismatched settlement instructions. In many cases, other stock or securities can be pledged as collateral for secured lending toguard against such failure. As a result, the Company is able to execute a substantial volume of transactions without the need for large amounts of workingcapital.

Funding for purposes other than working capital requirements, including the financing of acquisitions, has been provided either through internallygenerated cash flow or through specific long-term financing arrangements.

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The resale and repurchase transactions the Company enters into are generally collateralized with investment grade securities, including obligations ofthe U.S. government, government sponsored entity and federal agency obligations. Resale and repurchase agreements are also collateralized with Europeansovereign debt. Certain of these resale and repurchase transactions mature on the same date as the underlying collateral, and are accounted for as sales andpurchases, in accordance with the accounting standard for transfers and servicing.

Under the Company's repurchase agreements, including those repurchase agreements accounted for as sales, its counterparties may require theCompany to post additional margin at any time, as a means for securing its ability to repurchase the underlying collateral during the term of the repurchaseagreement. Accordingly, repurchase agreements create liquidity risk for the Company because if the value of the collateral underlying the repurchaseagreement decreases, whether because of market conditions or because there are issuer-specific concerns with respect to the collateral, the Company will berequired to post additional margin, which the Company may not readily have. If the value of the collateral were permanently impaired (for example, if theissuer of the collateral defaults on its obligations), the Company would be required to repurchase the collateral at the contracted-for purchase price upon theexpiration of the repurchase agreement, causing the Company to recognize a loss. Also, margin funds that are posted by the Company cannot be used by it forother purposes, which may limit the Company's ability to deploy its capital in an optimal manner or to effectively implement its growth strategy. Forinformation about these exposures and forward purchase commitments, see "—Off Balance Sheet Arrangements and Risk" and "Item 3. Quantitative andQualitative Disclosures about Market Risk—Disclosures about Market Risk—Risk Management."

As the Company increases its principal transactions activities, the Company will require additional working capital from channels in addition to itscurrent liquidity sources, including by raising additional long-term unsecured debt and establishing commercial paper and medium-term note programs.

As discussed above under "Significant Business Developments—The Company's Strategic Plan", the Company intends to transform its company into acommodities and capital markets—focused investment bank. As part of this change the Company anticipates that the volume and notional amount of principaltrading that the Company transacts—whether by making markets for clients or facilitating their trading, or by taking positions for its own account to monetizeits market views—will increase over the next several years. To support this increased activity, the Company will need additional working capital beyond theamount that is currently available to the Company through its revolving credit facility and other credit lines. The Company expects to seek this additionalworking capital through multiple channels, including by:

• obtaining additional credit lines from banks,

• raising short-term unsecured debt through commercial paper and promissory note issuances and other methods,

• raising long-term unsecured debt through registered offerings of debt or hybrid securities, medium-term note offerings and other methods,

• increasing its equity, by among other things, increasing internally generated cash flow and expanding its activities in prime services, assetmanagement and other areas of its business, or

• expanding access to deposits made through cash sweep programs in its internal broker networks.

In addition, the Company may be required to raise additional regulatory capital, either in the form of equity or debt, to support its planned expansioninto new business areas. In particular, the Company will need additional capital as the Company increases its risk exposure through principal trading.

As the Company proceeds to implement its strategic plan, its liquidity needs and sources are likely to change significantly from what they historicallyhave been. Furthermore, to the extent that the Company makes acquisitions using cash, its liquidity or working capital resources could be affected.

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Credit Facilities and Sources of Liquidity

MFGI Secured Facility

On June 29, 2011, the Company's U.S. regulated broker-dealer subsidiary, MF Global Inc. (MFGI), entered into a $300.0 million 364-day securedrevolving credit facility with a syndicate of lenders. In connection with the execution of the MFGI secured facility, the Company paid a one-time fee toparticipating lenders of $1.1 million recorded in Other assets which will be amortized over the life of the facility.

Under the MFGI secured facility, MFGI pays a commitment fee on the undrawn amount of 20 basis points per annum. Loans under the MFGI securedfacility bear interest on the principal amount outstanding, at the option of MFGI, at either (i) the higher of (x) the average of the rates on the offered side ofthe federal funds market quoted by three interbank federal funds brokers and (y) the Eurodollar rate for a one-month interest period, each plus 1.25%, or (ii) aperiodic fixed rate equal to the rate appearing on the Reuters Screen LIBOR01 for U.S. Dollars plus 1.25%. On all outstanding amounts, the MFGI securedfacility is secured by eligible collateral owned by MFGI and is guaranteed by the Company and one of its financing subsidiaries. At June 30, 2011, there wasno outstanding balance under the MFGI secured facility.

The borrowings, so long as the MFGI secured facility is in effect and there are loans outstanding under that facility, are subject to the terms andconditions set forth in the MFGI secured facility. The MFGI secured facility includes a covenant requiring MFGI's consolidated tangible net worth at any timenot to be less than $227.3 million.

Liquidity Facility

At March 31, 2010, the Company had a $1,500.0 million unsecured committed revolving credit facility maturing June 15, 2012 (the "liquidity facility")with a syndicate of banks.

On June 29, 2010, the liquidity facility was amended (the "Amendment") (i) to permit the Company, in addition to certain of its subsidiaries, to borrowfunds under the liquidity facility and (ii) to extend the lending commitments of certain of the lenders by two years, from June 15, 2012 (the "Old MaturityDate") to June 15, 2014 (the "Extended Maturity Date"). Aggregate commitments under the amended liquidity facility are approximately $1,200.9 million, ofwhich approximately $689.6 million is available to the Company for borrowing until the Extended Maturity Date, and approximately $511.3 million isavailable for borrowing until the Old Maturity Date. On June 15, 2012, outstanding borrowings subject to the Old Maturity Date (currently equal toapproximately $145.6 million) will become due. Under the terms of the amended liquidity facility, the Company may borrow under the available loancommitment subject to the Extended Maturity Date to repay the outstanding balance on the Old Maturity Date.

With respect to commitments and loans maturing on the Old Maturity Date (and at the current rating level and utilization), the Company pays a facilityfee of 10 basis points per annum and LIBOR plus 1.90% per annum on the outstanding borrowing. The liquidity facility is subject to a ratings-based pricinggrid. In the event credit ratings are downgraded, the highest rate on the grid would bring the facility fee to 12.5 basis points per annum and the rate on theoutstanding borrowing to LIBOR plus 2.375% per annum.

With respect to commitments and loans maturing on the Extended Maturity Date (and at the current rating level and utilization), the Company pays afacility fee of 40 basis points per annum and LIBOR plus 2.35% per annum on the outstanding borrowing. In the event credit ratings are downgraded, thehighest rate on the grid would bring the facility fee to 75 basis points per annum and the rate on the outstanding borrowing to LIBOR plus 2.75% per annum.

On borrowings in excess of $500.0 million related to the total liquidity facility, the Company will only pay a facility fee of 10 basis points per annumand LIBOR plus 0.40% per annum with respect to commitments and loans maturing on the Old Maturity Date. With respect to commitments and loansmaturing on the Extended Maturity Date, pricing is unchanged on amounts in excess of $500.0 million of the total liquidity facility.

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In all cases, borrowings are subject to the terms and conditions set forth in the liquidity facility which contains financial and other customary covenants.The amended liquidity facility includes a covenant requiring the Company to maintain a minimum consolidated tangible net worth of not less than the sum of(i) 75% of the pro forma Consolidated Tangible Net Worth as of March 31, 2010 after giving effect to the offering by the Company of equity interests onJune 2, 2010, including exercise of the underwriters' option to purchase additional shares, and the consummation in whole or in part of the offer to exchangeof the Company dated June 1, 2010 plus (ii) 50% of the net cash proceeds of any offering by the Company of equity interests consummated after the secondamendment effective date plus (iii) 25% of cumulative net income for each completed fiscal year of the Company after the second amendment effective datefor which consolidated net income is positive. The amended liquidity facility also requires the Company to limit its Consolidated Capitalization Ratio to be nogreater than 40.0% prior to March 31, 2011; 37.5% on or after March 31, 2011 and before March 31, 2012; and 35.0% on or after March 31, 2012.Furthermore, commencing on March 31, 2012, the amended liquidity facility also requires the Company to limit its Consolidated Leverage Ratio as at the lastday of any period of four fiscal quarters to be no greater than 3.0 to 1.0. Under the amended liquidity facility, the Company has agreed that it will not useproceeds of any borrowing under the liquidity facility to redeem, repurchase or otherwise retire any 9% Convertible Notes. Furthermore, beginning March 31,2012, the Company will not permit at any time prior to July 1, 2013, cash and cash equivalents to be less than the entire outstanding amount of the 9%Convertible Notes.

The amended liquidity facility continues to provide that if (i) the Company fails to pay any amount when due under the facility, (ii) or to comply withits other requirements mentioned above, (iii) if the Company fails to pay any amount when due on other material debt (defined as $50.0 million or more inprincipal) (iv) or other material debt is accelerated in whole or in part by the lenders, (v) or upon certain events of liquidation or bankruptcy, an event ofdefault will occur under the facility. Upon an event of default, all outstanding borrowings, together with all accrued interest, fees and other obligations, underthe facility will become due and the Company will not be permitted to make any further borrowings under the facility. In May 2011, for purposes of prudentliquidity management, the Company borrowed $50.0 million from the liquidity facility and the Company intends to continue using, from time to time, theliquidity facility for liquidity management. As of June 30, 2011 and March 31, 2011 $342.0 million and $367.0 million, respectively, were outstanding underthe liquidity facility with the remainder available to the Company. The Company has classified the $342.0 million of outstanding loans at June 30, 2011 underthe liquidity facility as short term debt. In connection with the Amendment, the Company paid a one-time fee to participating lenders of $6.8 million recordedin Other assets which will be amortized over the life of the facility.

The Company also has other credit agreements with financial institutions, in the form of trading relationships, which facilitate execution, settlement,and clearing flow on a day to day basis for its clients, as well as provide evidence, as required, of liquidity to the exchanges the Company conducts businesson. The Company had $5.9 million of outstanding issued letters of credit as of June 30, 2011.

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As of June 30, 2011, the Company's available liquidity and long-term capital increased to $2,982.7 million from $2,748.8 million, as of March 31,2011. The Company's management views long-term capital as all sources of debt and equity from its consolidated balance sheet which includes excess capital.An analysis of its available liquidity and long-term capital position is as follows:


June 30,2011

March 31,2011

Client Assets Non-Segregated Payables to customers $ 1,370.2 $ 1,186.3 Non-Segregated Collateral 251.1 233.8

1,621.3 1,420.1 Undrawn Liquidity Sources Liquidity Facility—Undrawn Portion 858.9 833.9

858.9 833.9 Long-Term Capital Equity 1,389.6 1,373.7 Preferred Stock (Notional Value) 190.4 190.4 Convertible Notes (Par Value)

(1) 475.3 475.3

Less: Non-Earning Assets (2)

(525.1) (515.6)

1,530.2 1,523.8 Less: Required Capital (3)

(1,027.7) (1,029.0)

Excess Capital 502.5 494.8 Total Available Liquidity and Long-Term Capital

(4) $ 2,982.7 $ 2,748.8

(1) The Company has 1.875% and 9% Convertible Notes, due 2016 and 2038, respectively, in an aggregate amount of $287.5 million and $187.8 million,

respectively. See Note 10 to the consolidated financial statements for further information.(2) Non-earning assets consists of other receivables, memberships in exchanges, furniture, equipment and leasehold improvements, goodwill, intangible

assets and other assets, excluding trading related balances.(3) Includes regulatory early warning amounts.(4) These amounts represent the sum of the Company's available liquidity sources and committed and uncommitted long-term capital.

Analysis of Cash Flows

The Company prepares its statement of cash flows in accordance with U.S. GAAP. This may not reflect its daily cash flows or impact of its clients'transactions on its working capital position. The following tables present, for the periods indicated, the major components of net increases/ (decreases) in cashand cash equivalents:



2011 2010 Cash flows from: Operating activities $ 100.6 $ (359.6) Investing activities (19.3) (11.2) Financing activities (23.1) 164.3 Effect of exchange rate changes 1.8 (2.1)

Net increase/(decrease) in cash and cash equivalents $ 60.0 $ (208.6)

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Operating Activities

Net cash provided by operating activities was $100.6 million in the three months ended June 30, 2011 compared to cash used in operating activities of$359.6 million in the three months ended June 30, 2010. Net cash from operating activities primarily consists of net income adjusted for certain non-cashitems, including depreciation and amortization, gains on sale of exchange seats and shares, impairment of assets, stock-based compensation expense, loss onextinguishment of debt, and deferred income taxes, as well as the effects of changes in working capital. During the three months ended June 30, 2011, theCompany recorded impairment charges of $0.7 million related to goodwill, amortization of debt issuance costs of $2.3 million and an accretion of debtdiscount of $3.1 million. During the three months ended June 30, 2010, the Company recorded impairment charges of $0.8 million related to goodwill andamortization of debt issuance costs of $1.7 million. Working capital results in the most significant fluctuations to cash flows from operating activities,primarily reflecting (1) the levels of its collateralized financing arrangements, including repurchase and resale agreements, securities borrowing/lendingtransactions, securities owned and securities sold, not yet purchased (2) the levels of its restricted cash and (3) payables to customers due to margin andcontractual commitments. Collateralized financing arrangements often result in significant fluctuations in cash flows, as cash is often received or used ascollateral in these arrangements, and therefore the level of activity in these transactions at period-end directly impacts its cash flows from operating activities,without a specific correlation to its revenues or net income. Therefore, if cash provided under collateralized financing arrangements increased from one periodto the next, this will be reflected as a cash outflow from operating activities. In the three months ended June 30, 2011, and 2010, these arrangements resultedin net cash used of $3,097.3 million and net cash received of $4,875.0 million, respectively. This was offset by changes in securities owned and securitiessold, not yet purchased in the three months ended June 30, 2011, and 2010, resulting in cash received of $2,508.4 million and cash used of $5,282.8 million,respectively. Overall, in the three months ended June 30, 2011, the movements in these arrangements drove the increase in cash flows from operatingactivities. Furthermore, the Company's levels of restricted cash also impact its operating cash flows, which for the three months ended June 30, 2011 and 2010resulted in cash provided of $455.7 million and $198.5 million, respectively. This activity directly impacts the Company's operating cash flows, as wasevidenced during the three months ended June 30, 2011.

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The Company's client activities generate or use operating cash flows, which the Company finances through yield enhancement activities discussedbelow. There has been a change in its balance sheet from March 31, 2011 to June 30, 2011, and the Company analyzes the changes to its client activities andhow the Company has financed these activities as follows: (dollars in billions) June 30, 2011 March 31, 2011 Change Drivers of Liquidity—Client Activity Receivables—Customers, net of allowances $ 0.3 $ 0.3 $ — Payables—Customers (13.5) (13.6) 0.1 Receivables—Brokers, dealers, and clearing organizations 4.6 4.2 0.4 Payables—Brokers, dealers, and clearing organizations (1.8) (1.1) (0.7)

Net (uses)/sources (0.2)

Yield Enhancement Activities Cash and cash equivalents 0.7 0.6 (0.1) Restricted cash and segregated securities 10.9 11.3 (0.4) Securities purchased under agreements to resell 12.0 9.4 2.6 Securities sold under agreements to repurchase (17.9) (16.6) (1.3)

Net 0.8 Securities borrowed 4.9 2.9 2.0 Securities loaned (1.6) (1.4) (0.2)

Net 1.8 Securities owned 11.6 10.8 0.8 Securities sold, not yet purchased, at fair value (8.3) (5.1) (3.2)

Net (2.4)

Net funding sources/(uses) 0.2

$ 0.0

Investing Activities

Net cash used in investing activities was $19.3 million during the three months ended June 30, 2011, as compared to $11.2 million for the three monthsended June 30, 2010, respectively. These activities primarily relate to proceeds received from the sale of seats and shares related to exchange memberships,offset by purchase of exchange memberships, and furniture, equipment and leasehold improvements. In the three months ended June 30, 2011, cash used inconnection with earn-out payments related to prior acquisitions was $0.7 million, as compared to $0.8 million during the three months ended June 30, 2010.Additionally, cash used to purchase furniture, equipment and leasehold improvements was $21.1 million, as compared to $10.4 million during the threemonths ended June 30, 2010. In the three months ended June 30, 2011, the Company received proceeds from the sale of memberships in exchanges of $2.1million and a dividend of $0.4 million from excess exchange membership shares.

Financing Activities

Net cash used in financing activities was $23.1 million, as compared to cash provided of $164.3 million during the three months ended June 30, 2011and 2010, respectively. For the three months ended June 30, 2011, these financing activities mainly related to the borrowings from the Company's liquidityfacility for purposes of prudent liquidity management of $50.0 million, proceeds from other short-term borrowings of $8.1 million, offset by the payment ofdebt issuance costs of $1.3 million related to the MFGI secured facility and issuance of the 1.875% Convertible Notes, the repayment of $75.0 million underthe Company's liquidity facility and the

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payment of preferred dividends of $5.0 million. During the three months ended June 30, 2010, financing activities mainly related to the net proceeds from theissuance of the Company's Common Stock of $174.8 million and proceeds from other short-term borrowings of $4.0 million, which was offset by the paymentof debt issuance costs related to the amendment of the Company's liquidity facility of $6.8 million and the payment of preferred dividends of $7.7 million.

Dividend Policy

The Company does not intend to pay any cash dividends on its shares of Common Stock in the foreseeable future and the Company intends to retain allits future earnings, if any, to fund the development and growth of its business. Any future determination whether or not to pay dividends on its shares ofCommon Stock will be made, subject to applicable law, by its board of directors and will depend upon its results of operations, financial condition, capitalrequirements, regulatory and contractual restrictions, its business and investment strategy and other factors that its board of directors deem relevant.

On July 26, 2011, the Company's Board of Directors declared a quarterly dividend on the Series A Preferred Stock and Series B Preferred Stock inamounts of $4.0 million and $1.0 million, respectively. These dividends had a record date of August 2, 2011, and will be paid on August 15, 2011.

Off-Balance Sheet Arrangements and Risk

The Company is a member of various exchanges and clearing organizations. Under the standard membership agreement, members are required toguarantee the performance of other members and, accordingly, if another member becomes unable to satisfy its obligations to the exchange, all other memberswould be required to meet the shortfall. The Company's liability under these arrangements is not quantifiable and could exceed the cash and securities theCompany has posted as collateral. However, management believes that the potential for the Company to be required to make payments under thesearrangements is remote. Accordingly, no contingent liability is carried in the accompanying consolidated balance sheets for these arrangements.

The Company's client financing and securities settlement activities require the Company to pledge client securities as collateral in support of varioussecured financing sources, such as securities loaned. In the event the counterparty is unable to meet its contractual obligation to return client securities pledgedas collateral, the Company may be exposed to the risk of acquiring securities at prevailing market prices in order to satisfy its client obligations. The Companycontrols this risk by monitoring the market value of securities pledged on a daily basis and by requiring adjustments of collateral levels in the event of excessmarket exposure. In addition, the Company establishes counterparty limits for such activities and monitors compliance on a daily basis.

In the normal course of business, the Company's client activities involve the execution, settlement and financing of various transactions. These activitiesmay expose the Company to off-balance sheet risk in the event its client or the other broker is unable to fulfill its contracted obligations and the Company hasto purchase or sell the financial instrument underlying the contract at a loss. The risk of default depends on the creditworthiness of the counterparty or issuerof the instrument. It is the Company's policy to review, as necessary, the credit standing of each counterparty with which the Company conducts business. See"Liquidity and Capital Resources—Credit Facilities and Sources of Liquidity" above for discussions of letters of credit issued to the Company's clients.

Certain resale and repurchase transactions involve the sale and repurchase of the underlying collateral which generally mature on the same date as theunderlying collateral. These transactions are accounted for as sales and purchases, and the Company de-recognizes the related assets and liabilities from itsconsolidated balance sheets, and records a forward repurchase or forward resale commitment, in accordance with the accounting standard for transfers andservicing. These transactions are generally collateralized with investment grade securities, including obligations of the U.S. government, governmentsponsored entities and federal agencies. These transactions are also collateralized with European sovereign debt. For repurchase transactions that areaccounted for as sales, the

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Company maintains the exposure to the risk of default of the issuer of the underlying collateral assets, such as U.S. government obligations or Europeansovereign debt. The forward repurchase commitment represents the fair value of this exposure and is accounted for as a derivative. The value of the derivativeis marked to market and movements in the value of the derivative may cause volatility in the Company's financial results until the underlying collateralmatures. At maturity, the Company is required to redeem the underlying collateral at par, which may cause the Company to recognize losses if the value of thecollateral is less than par. If the value of the collateral at maturity is less than the repurchase price, for example due to an issuer default, the Company wouldnot be able to recover the cost of the repurchase price and would incur a loss, which would adversely affect its operating results and cash flow. For adescription of market and credit risks associated with these commitments see "Item 3. Quantitative and Qualitative Disclosures about Market Risk—Disclosures about Market Risk—Risk Management."

At June 30, 2011, securities purchased under agreements to resell and securities sold under agreements to repurchase of $5,233.2 million and $16,548.5million, respectively, at contract value were de-recognized. At March 31, 2011, securities purchased under agreements to resell and securities sold underagreements to repurchase of $1,495.7 million and $14,520.3 million, respectively, at contract value, were de-recognized. See Note 3 to the unauditedconsolidated financial statements for further details.

Critical Accounting Estimates

The preparation of the Company's unaudited consolidated financial statements requires the Company to make estimates and assumptions that affect thereported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Company's unaudited consolidated financialstatements and on the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates and assumptions on historicalexperience and on various other factors that the Company believes is reasonable under the circumstances. The Company considers these accounting estimatesto be critical because changes in underlying assumptions or estimates could have the potential to materially impact its financial statements.

The Company's significant accounting policies are summarized in Note 2 and throughout the footnotes to its unaudited consolidated financialstatements. The Company believes that certain of these policies are critical because they are important to the presentation of its financial condition and results.On an ongoing basis, the Company evaluates its estimates and assumptions, particularly as they relate to accounting policies that the Company believes aremost important to the presentation of its financial condition and results of operations. The Company regards an accounting estimate or assumption to be mostimportant to the presentation of its financial condition and results of operations where the nature of the estimate or assumption is material due to the level ofsubjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change; and the impact of the estimate orassumption on its financial condition or operating performance is material.

The Company's critical accounting policies and estimates are summarized in Item 7 of its 2011 Annual Report on Form 10-K.

Fair Value of Financial Instruments

The Company carries a significant portion of its assets and liabilities at fair value. These assets and liabilities consist of financial instruments, includingcash and derivative products, and primarily represent its investment, trading, financing and customer facilitation activities. Financial instruments are recordedin the financial statements on a trade-date basis and they include related accrued interest or dividends. Changes in the fair value of financial instruments arerecognized in earnings within Principal transactions in the Company's unaudited consolidated statements of operations.

The Company adopted the provisions under ASC 820, Fair Value Measurements, as of April 1, 2008. Fair value is defined as the price that would bereceived to sell an asset or paid to transfer a liability in an orderly

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transaction between market participants at the measurement date, or an "exit" price. The Company marks its financial instruments based on quoted marketprices, where applicable. Based on market convention the Company marks its financial instruments based on product class which is generally bid or midprice. If listed prices or quotes are not available, the Company determines fair value based on comparable market transactions, executable broker quotes, orindependent pricing sources with reasonable levels of price transparency. Fair value measurements are not adjusted for transaction costs.

Credit risk is a component of fair value and represents the loss the Company would incur if a counterparty or an issuer of securities or other instrumentsthe Company holds fails to perform under its contractual obligations to the Company, or upon a deterioration in the credit quality of third parties whosesecurities or other instruments, including OTC derivatives, the Company holds. To reduce its credit exposures in its operating activities, the Companygenerally enters into agreements with its counterparties that permit the Company to offset receivables and payables with such counterparties and obtainmargin and/or collateral from the counterparty on an upfront and ongoing basis. The Company monitors and manages its credit exposures daily. TheCompany considers the impact of counterparty credit risk in the valuation of its assets and its own credit risk in the valuation of its liabilities that are presentedat fair value.

Financial instruments are categorized into a three-level valuation hierarchy for disclosure of fair value measurements, as further discussed in Note 5.The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowestpriority to unobservable inputs (Level 3 measurements). A market is active if there are sufficient transactions on an ongoing basis to provide current pricinginformation for the asset or liability, pricing information is released publicly, and price quotations do not vary substantially either over time or among marketmakers. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sourcesindependent of the reporting entity. The fair value hierarchy is based on the observability of inputs in the valuation of an asset or liability at the measurementdate. In determining the appropriate fair value hierarchy levels, the Company performs a detailed analysis of its assets and liabilities. At each reporting period,all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The three levels aredescribed as follows:

Level 1—Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 1consists of financial instruments whose fair values are determined using quoted market prices.

Level 2—Quoted prices for identical or similar assets or liabilities in markets that are less active, that is, markets in which there are few transactions forthe asset or liability that are observable for substantially the full term. Included in Level 2 are those financial instruments for which fair values areestimated using models or other valuation methodologies. These models are primarily industry-standard models utilizing various observable inputs,including time value, yield curve, volatility factors, observable current market and contractual prices for the underlying financial instruments, as well asother relevant economic measures.

Level 3—Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported bylittle or no market activity). Level 3 is comprised of financial instruments whose fair value is estimated using internally developed models ormethodologies utilizing significant inputs that are not readily observable from objective sources.

Refer to Note 5, Fair Value Measurements and Derivative Activity, for the analysis prepared as of June 30, 2011.

Recent Accounting Pronouncements

In June 2011, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2011-05, Comprehensive Income—Presentation of Comprehensive Income ("ASU No. 2011-05").

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ASU No. 2011-05 will align U.S. GAAP guidance on presentation of comprehensive income more closely with the International Financial ReportingStandards ("IFRS"). However, other differences in reporting comprehensive income still remain between U.S. GAAP and IFRS. The Company will adoptASU No. 2011-05 in the first quarter of fiscal 2013 and does not expect material changes to its consolidated financial statements.

In May 2011, the FASB issued ASU No. 2011-04, Fair Value Measurement—Amendments to Achieve Common Fair Value Measurement andDisclosure Requirements in U.S. GAAP and IFRSs ("ASU No. 2011-04"). ASU No. 2011-04 generally represents clarifications to the current fair valuemeasurement standard under U.S. GAAP and hence many of its amendments are not intended to result in a change in the application of the requirements ofthe current standard. However, ASU No. 2011-04 does include some instances where a particular principle or requirement for measuring fair value ordisclosing information about fair value measurements has changed. The Company will adopt ASU No. 2011-04 in the fourth quarter of fiscal 2012. TheCompany is currently assessing the impact it will have on its consolidated financial statements.

In April 2011, the FASB issued ASU No. 2011-03, Transfers and Servicing—Reconsideration of Effective Control for Repurchase Agreements ("ASUNo. 2011-03"). ASU No. 2011-03 removes from the assessment of effective control the requirement that the transferor has the ability to repurchase or redeemthe financial asset that was transferred and the related collateral maintenance implementation guidance. The Company will adopt ASU No. 2011-03 in thefourth quarter of fiscal 2012 and does not expect a material impact on its consolidated financial statements upon adoption.

In January 2010, the FASB issued ASU No. 2010-06, Fair Value Measurements and Disclosures ("ASU No. 2010-06"). The guidance in ASUNo. 2010-06 provides amendments to ASC 820 which requires a reporting entity to disclose separately the amounts of significant transfers in and out of Level1 and Level 2 fair value measurements and describe the reasons for the transfers. In addition, with regards to Level 3 assets, ASU No. 2010-06 now requiresthat a reporting entity should present separately information about purchases, sales, issuances and settlements on a gross basis in the reconciliation for fairvalue measurements using significant unobservable inputs (Level 3). The Company adopted the new disclosures and clarifications of existing disclosures inthe fourth quarter of fiscal 2010. The Company adopted the disclosures about purchases, sales, issuances, and settlements in the roll-forward of activity inLevel 3 fair value measurements in the first quarter of fiscal 2012 with no material impact to its consolidated financial statements.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Risk Management

Overview

The Company is exposed to numerous risks in the ordinary course of its business, and effective risk management is critical to the success of itsbusiness. The Company has a comprehensive risk governance structure and management processes through which the Company monitors, evaluates, andmanages the risks the Company assumes in conducting its business. The principal risks the Company faces include market risk (within which the Companyincludes issuer default risk), credit risk, regulatory capital risk, liquidity risk and operational risk.

Governance

The Company's enterprise risk governance framework involves the oversight of its Board of Directors together with the Company's risk oversightcommittees, policies and procedures, and defined delegation of authority. The Company's Board-approved risk appetite and strategic objectives translate todefined risk tolerances and oversight processes and, subsequently, strictly enforced delegations of authority and concomitant controls, which are designed toensure its operation within those risk tolerances.

The Chief Risk Officer ("CRO"), who reports to the Company's President and Chief Operating Officer, leads the Risk department and is delegatedcertain authorities from the Board. The CRO reports and advises on

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market, credit, issuer and operational risk matters. The CRO and senior management promote companywide compliance to its enterprise risk managementframework. The CRO is supported by several regional risk officers and a global team to implement the framework.

The risk oversight committees monitor and manage risk company-wide and report on risk at the Board and senior management levels. Dedicatedcommittees address various financial, non-financial and regional risks. The Company's senior management leads and actively participates in many of theserisk committees. Risk officers are active participants in many strategic and business committees. The Company believes that effective risk management isonly possible with effective communication and maintaining an open dialogue between the Board, senior management, business areas, and the Riskdepartment.

The enterprise risk management framework employs this governance structure, which is intended to embed a strong risk culture and clearly define rolesand responsibilities for risk taking, processing, reporting, and control. The enterprise risk management framework comprises the activities and methodsthrough which the Company maintains risk within acceptable risk tolerances. Business areas, pursuant to delegated authority, have primary responsibility forrisk management. Working with the business areas, the Risk department seeks to identify, assess, measure, monitor and limit the risks consistently across theCompany's businesses. The internal audit department and audit committee further provide independent control and assurance of the risk-management process.

Process

Processes and procedures are key components of the Company's risk management. The basis for its culture regarding risk-taking activities is the riskappetite. The Company establishes limits for each of its businesses based on its risk appetite, which is set by the Board. Business areas, pursuant to delegatedauthority, have primary responsibility for risk management by balancing their ability to profit from revenue-generating activities with their exposure topotential losses. Working with the business areas, the Risk department established a suite of limit techniques including, but not limited to, mandate limitsapplicable to specific businesses and risk types, value-at-risk, and stress scenario testing.

The Company has established and documented mandates for market risk assumed by its revenue-generating areas. For certain revenue-generating areasthe risk mandates are supplemented with intra-day and overnight monitoring against the prescribed limits, both by the business areas and the Risk department.The Market Risk department quantifies and assesses risks, and escalates breaches to risk limits.

Credit risk limits are established by the Credit Risk department through the reviews of counterparties and customers. Placement and issuer risk isreviewed, assessed and managed through established limits. The Credit Risk department assesses and monitors risk exposure against these credit limits andany breaches are escalated.

Operational risk management is a systemic process maintained by the Operational Risk department to identify, assess, measure and manage operationalrisk. Each business area has established processes, systems, and controls to manage operational risk and is responsible for escalating incidents, issues andcontrol indicators.

People

All of the Company's employees are considered risk managers. Employees are expected and encouraged to escalate risk incidents and any matters ofconcern to management and to its compliance and risk departments in order to effectively manage risk.

The Company's senior management is responsible for implementing the risk management framework. The Company continually seeks to improve itstechnology and processes. In addition, the Company believes that effective risk management requires its people to make judgments, interpretations and keybusiness decisions that

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cannot entirely be controlled by process and technology. The Company strives to build a strong risk management team, which works closely with itsmanagement and business areas to deliver effective risk management. The Company's Risk department managers provide the additional support inunderstanding and controlling the nuances and limitations of the risk measures deployed. While the Company seeks to implement an effective riskmanagement framework and process, the Company may incur losses as a result of ineffective processes, technologies or strategies.

Market Risk

Market risk refers to the risk of loss due to changes in the value of financial instruments, positions and investments resulting from fluctuations in thelevel of market factors. The Company holds inventory of securities positions and investments for its market making and client facilitation principal activitiesand proprietary activities as well as treasury operations. Accordingly, the Company is exposed to risks related to movements in interest rates, currencyexchange rates, security and commodity prices, yield curves, issuer risk including changing credit spreads, changes in ratings and the possibility of issuerdefaults, mortgage spreads and implied volatilities. The Company is also exposed to changes in instrument and market correlations.

The Company is exposed to market risk from its market making and client facilitation principal activities, proprietary activities, other companyinvestments, and treasury operations. The Company's treasury and other company investments include those made for cash and asset liability management,including held-to-maturity investments and repo-to-maturity transactions. A held-to-maturity investment is a security that the Company has the ability andintent to hold until its date of maturity and does not intend to sell or trade. A repo-to-maturity transaction is a repurchase agreement that matures on the samedate as the underlying collateral. The market risks the Company is exposed to in held-to-maturity and repo-to-maturity activities include, but are not limitedto, interest rate, credit spread, rating downgrade and issuer default risks.

The Company is exposed to market risk from its market making and client facilitation principal activities and proprietary activities through the positionsthe Company carries in debt and fixed income securities and through the investments the Company makes related to client cash and margin balances.

Currency rate risk includes the risk from its proprietary and principal activities, and from its assets held outside of the United States. A portion of itsassets and liabilities must be held in foreign currencies to meet operational, regulatory and other obligations of its non-U.S. operations. This exposure isdiscussed further below in "Currency Risk."

Commodity price risk arises from the possibility that commodity prices will fluctuate, affecting the value of instruments directly or indirectly linked tothe price of the underlying commodity. The Company is exposed to commodity prices through its proprietary, market making and matched principaltransactions in the agricultural, metals and energy markets.

The Company is exposed to equity price and volatility risk, as a consequence of its proprietary, client facilitation and market making activities. TheCompany is also exposed to additional event risks, including regulatory, capital, funding and liquidity, and tax in these activities.

The Company manages these exposures by limiting the size and concentration of positions that it holds in accordance with its risk appetite and inaccordance with instructions from the delegated authorities, both approved by the Board. The risk taken by its business areas, especially its revenue-generating areas, is approved in defined risk mandates as delegated by the CRO. The Company's business areas are responsible for these risks and areexpected to operate within these prescribed mandates. Business areas are also responsible for managing their risk-revenue expectations in collaboration withthe Risk department. End-of-day, and for certain businesses, intra-day monitoring processes mitigate risk taking in excess of the Company's risk appetite.

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The Company employs different techniques to measure and dynamically monitor its market risk exposures. These controls and metrics are prescribed inthe risk mandates.

The Market Risk department measures, monitors, reviews and escalates exposures of its portfolios using value-at-risk and stress testing scenarios. TheMarket Risk department distributes daily reports with value-at-risk based measures to varying levels of management. Other risk monitoring and assessmenttechniques include but are not limited to:

• concentration limits based on open interest, market issuance, and trade volume;

• risk limits to ensure diversification of instruments and issuers within a portfolio;

• limits to maintain the size of portfolios within the target strategy, and limits related to liquidation costs;

• authorized product lists of instruments and securities consistent with the objective strategy of the portfolio;

• limits to keep the liquidity and capital usage of market risk portfolios within its mandates;

• notional limits for delivery and settlement processes;

• limits for adequacy of margin requirements for traded products;

• sensitivity limits and risk measurement parameters (i.e. "the Greeks" and 1 basis point sensitivity to interest rates and credit spreads);

• issuer and country credit limits; and

• stress scenario limits.

Positions are monitored and reviewed intra-day, where appropriate, and end-of-day to identify any accounts trading beyond pre-set limits andparameters. Escalations are made and actions are taken in line with the Company's policy.

Despite its formalized risk framework, the Company may not review and assess every transaction and may not be able to monitor the impact of marketmovements on every position, particularly intra-day, given its high transaction volume. Additionally, sudden movements or disruptions in the market couldcause adverse changes to its market risk exposures. While the Company uses a variety of techniques to monitor market risk, the risk management tools andsystems the Company uses may not effectively control this exposure.

The Company also depends on third party providers or systems to prepare its risk monitoring reports and metrics. System interruptions or failures couldcause a disruption to its risk management process and therefore its business. The mathematical models and methodologies that are derived from its riskmonitoring processes and systems are also subject to potential flaws, operational risks and limitations. The Company uses reasonable efforts to ensureaccuracy of these models and methodologies. However, there is a possibility of error which can potentially result in losses and disruptions.

Currency Risk

For currency rate risk, the Company regularly monitors movements in certain currencies. The Company's revenues and expenses are denominatedprimarily in U.S. dollars, British pounds and Euros. Additionally, for certain entities in the U.K. and Singapore, the functional currency is U.S. dollars.Therefore, while operating expenses for these entities are paid in local currency, they are accounted for in the financial statements in U.S. dollars. Thetranslation from local currency to U.S. dollars for these entities can impact the Company's consolidated financial results as exchange rates vary. As part of itsstandard processes, the Company seeks to mitigate its exposures to foreign currency exchange rates through hedging transactions.

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The table below shows the approximate increase in the Company's other expenses due to instantaneous 10% adverse currency-exchange ratemovements against the U.S. dollar in its major currency exposures for the three months ended June 30, 2011:

Adverse exchangerate movementagainst the U.S.

dollar

Approximateincrease in Generaland Other expenses

(in millions) British pounds 10% $ 5.3 Euro 10% $ 0.6 Australian dollar 10% $ 0.8 Singapore dollar 10% $ 0.6

Value-At-Risk

Value-at-risk is an estimate of the potential loss in value due to adverse market movements over a defined time horizon at a specified confidence level.The Company reports using a 95% confidence level calibration over a one-day time horizon. The reported value-at-risk indicates a threshold at which theexpected loss over one day will not exceed that value more than 5% of the trading days of the year. The Company uses a Monte Carlo Simulationmethodology for measuring and reporting value-at-risk, which is tested and verified against historic value-at-risk. The model uses 3 years of historic data tocharacterize and emulate changes in market risk factors. Value-at-risk and related limits are further supplemented with stress risk measures and limits as wellas mandate limits.

The value-at-risk model to measure the Company's principal-position risk characteristics requires a number of assumptions and approximations. Whilethe Company believes that these assumptions and approximations are reasonable, the Company also believes that value-at-risk is not appropriate to all of itsactivities; therefore, the Company supplements value-at-risk measurements with additional risk management controls and techniques. No standardmethodology for estimating value-at-risk exists, and different assumptions and / or approximations could produce materially different value-at-risk estimates.Value-at-risk measures have inherent limitations, including:

• historical market conditions and historical changes in market risk factors may not be accurate predictors of future market conditions or futuremarket risk factors;

• value-at-risk measurements are based on current positions, while future risk depends on future positions;

• value-at-risk measurements are based on a one-day measurement period and do not fully capture the market risk of positions that cannot beliquidated or hedged within one day;

• value-at-risk is not intended to capture worst-case (i.e., "tail") scenario losses and the Company could incur losses greater than the value-at-riskamounts reported;

• value-at-risk is not an effective tool for understanding underlying risk drivers and therefore value-at-risk measurements must be analyzed inconjunction with other risk tools, measurements, and techniques; and

• value-at-risk does not capture risks associated with liquidity and depth of the market.

It is implicit in a value-at-risk methodology that individual positions possess risk characteristics that do not aggregate and to some extent offset eachother, which is referred to as the diversification benefit. Certain diversification benefit is inherent in the Company's market risk portfolio and is dependent onhistoric correlations used within its methodology. The correlation implied from historic data may not always predict the future accurately. The diversificationbenefit therefore may not be realized.

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As of June 30, 2011, the Company's quarterly average end-of-day value-at-risk for financial positions taken for its trading accounts includingproprietary activities, client facilitation and market making, estimated at a 95% confidence level over a one-day time horizon using a Monte Carlomethodology, was $2.8 million. The table below presents the quarterly average, minimum and maximum trading value-at-risk, for the three months endedJune 30, 2011: June 30, 2011

Risk Categories Average Minimum Maximum

(dollars in thousands) Commodities $ 1,179 $ 799 $ 1,371 Equities 1,364 1,094 1,516 Fixed Income 2,787 2,231 3,753 Foreign Exchange 669 390 1,038 Diversification effect (1)

(2,950) (2,005) (3,818)

Total $ 3,049 $ 2,509 $ 3,860

(1) Equals the difference between total value-at-risk and the sum of the value-at-risk for the four risk categories. This arises because the market risk

categories are not perfectly correlated.

This value-at-risk calculation does not include the Company's investments in held-to-maturity investments, repo-to-maturity transactions, investmentsmade for asset-liability management including investments of client funds, and exchange shares and securities deposited at exchanges and clearingorganizations. Held-to-maturity investments and repo-to-maturity transactions are expected to be held to maturity, are excluded from the Company's tradingaccounts, and are expected to have limited earnings volatility unless impacted by issuer risk (changes in credit spreads, changes in credit ratings, andpossibility of issuer default), and as such are better represented by other risk measures and not included in value-at-risk. The market-risk from the Company'sasset-liability management activities, including investments made for client funds, is not included in value-at-risk, as this is better represented by other riskmeasures. The Company measures and manages this exposure using techniques prescribed in its risk mandate. The exchange shares, which are long terminvestments required for its business activities, are not considered a trading activity and therefore, are also not included in value-at-risk.

For transactions and investments not included in value-at-risk, the Company is exposed to market risk based on the credit worthiness of the issuer,including the U.S. government and its agencies, sovereign countries and issuers of investment grade corporate bonds. The table below presents the notionalvalue of the issuer risk of the transactions and investments outside the trading portfolio as of June 30, 2011 net of hedging transactions the Company hasundertaken to mitigate issuer risk. The other sovereign obligations referenced in the two below tables are issued by a group of western European countries,consisting of Italy, Spain, Belgium, Portugal and Ireland, which have a weighted average maturity for long positions of October 2012. The Company alsoconstrains the tenor of country maturities as a means to mitigate issuer default risk. For example Portugal and Ireland carry a weighted average maturity ofFebruary 2012. The entire portfolio matures by December 2012, which is prior to the expiration of the European Financial Stability Facility. For additionalinformation about repo-to-maturity transactions, see Note 3 to the unaudited consolidated financial statements and "Item 2. Management's Discussion andAnalysis of Financial Condition and Results of Operation—Off-Balance Sheet Arrangements and Risk." From time to time, and in addition to short positionsin its non-trading book, the Company also takes short positions in its trading book to mitigate its issuer credit risk further. Corporate bonds are investmentgrade debt of major corporations, mostly in the U.S. and U.K.

Category

Notional Value(in billions)

U.S. government and federal agency obligations $ 8.5 Other sovereign obligations $ 6.4 Corporate bonds $ 2.9

The table below presents the 10 basis point sensitivity of credit spreads for the obligations of U.S. government and federal agency obligations; the 10basis point sensitivity of credit spreads for other sovereign

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obligations, and the 10 basis point sensitivity of credit spreads for the corporate bonds, as of June 30, 2011.

Category

10 bp sensitivity(in millions)

U.S. government and federal agency obligations $ 10.6 Other sovereign obligations $ 10.7 Corporate bonds $ 4.3

This sensitivity analysis of the impact of a 10 basis point change in credit spreads to the change in value of these instruments is reflective of the issuerrisk (including changes in credit spread, changes in credit ratings and possibility of issuer default) inherent within the portfolio. The change in value will notbe realized unless there is a default of the issuer of the underlying securities, as the Company intends to hold the portfolio to maturity. However, for resale andrepurchase transactions accounted for as sales and purchases, we record a forward repurchase or forward resale commitment in accordance with theaccounting standard for transfers and servicing, which together is accounted for as a derivative. The value of the derivative is subject to mark to marketmovements based on the value of the underlying collateral, which may cause volatility in our financial results until maturity of the underlying collateral, andwhich will not be realized unless there is a default of the issuer of the underlying securities. As of June 30, 2011 the impact on the value of this derivative of anet 10 basis point move of sovereign credit spreads and the repurchase rates financing these sales, is approximately $10.8 million.

Credit Risk

Credit risk is the potential for loss related to the default or deterioration of the credit quality of a client, counterparty, or issuer of securities. Credit riskderives from assets placed with banks, broker dealers, clearing organizations and other financial institutions. Additionally, credit risk arises from repurchaseand resale transactions, securities borrowed and loaned, and receivables from other brokers and dealers.

In its business the Company acts as both an agent and principal in providing execution and clearing services for listed and OTC transactions, whichexposes the Company to credit risk. The Company also makes investments in certain securities which expose the Company to credit risk. Additionally, itsbusiness requires the Company to post collateral and make deposits at financial institutions and intermediaries. Sources of the Company's exposure to creditrisk include exposure to:

• financial institutions, clearing organizations, exchanges and other counterparties with whom the Company places both its own funds or securitiesand those of its clients, including the posting of margins;

• sovereign entities and corporations that are downgraded or default on their respective obligations that the Company owns as securities;

• counterparties with whom the Company has resale and repurchase agreements or securities borrowing and lending activities;

• clients and counterparties that are unable or unwilling to meet their obligations due to losses arising from adverse market moves;

• clients and counterparties to whom the Company extends financing lines;

• clients and counterparties through clearing and settlement operations;

• clients who owe the Company commissions; and

• credit concentration risks.

The Company is exposed to losses when clients are not able or willing to meet their obligations to the Company and their posted margin is insufficientto satisfy the deficit. Similarly, the Company is also exposed to clients to whom the Company provides secured (i.e., collateralized), unsecured and risk-basedfinancing lines to cover initial and variation margin. Financial markets are volatile and an adverse market movement can quickly cause a significant tradingloss for a client. The Company's principal client-based credit risk can also arise when

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a client's margin collateral cannot support trading obligations due to the client's trading activity. Global economic conditions can have an impact on thefinancial fortitude of businesses across all industries, potentially affecting the ability and likelihood of repayment to the Company. Many of the Company'sexposures with clients and counterparties are subject to netting agreements which can reduce the net exposure to the Company.

The Company provides execution and clearing services for its clients. In this industry, the Company's default risks include both pre-settlement andsettlement risk. Pre-settlement risk is the possibility that, should a counterparty default on its obligations, the Company could incur a loss when the Companycovers the resulting open position because the market price has moved against the Company. Settlement risk is the possibility that the Company may pay orrelease assets to a counterparty and fail to receive the settlement in turn.

For execution-only clients, the Company earns a commission for executing trades on an agency basis. For these customers, the Company's principalcredit risk arises from the potential failure of its clients to pay commissions ("commission risk"). The Company is also exposed to the risk that a clearingbroker may refuse to accept a client's trade, which would require the Company to assume the positions and the resulting market risk. In such cases, thepositions are reconciled with the broker or liquidated.

In the ordinary course of its business, the Company may be exposed to certain concentrations of credit risk, which is a large exposure to a single clientor counterparty, exposure to a group of connected clients or counterparties, or multiple exposures to a group of unrelated clients or counterparties whose riskof default is driven by common factors – for example, a similar business, industry, geographical location or product exposure. The Company may also besubject to a concentration of credit risk to a particular counterparty, borrower or issuer, or to a particular clearing house or exchange. The Company could beexposed to concentration risk in the positions the Company holds when acting as principal for a client, in its own proprietary activities and investments, aswell as in the trading the Company executes to invest its excess cash or client funds.

The Company mitigates credit risk through various means. The Company manages placement and issuer risks through institutional, issuer, andconcentration limits and via counterparty-creditworthiness assessments. Placement risk arises from its placement of customer and house funds at banks,financial institutions, clearing houses, exchanges, and other broker dealers. The Company conducts the same due diligence on the counterparty banks withwhom the Company places clients' segregated funds as the Company conducts on banks with whom the Company places its own and non-segregated funds.The Company regularly reviews its credit assessments and limits are monitored daily.

The Company's Credit Risk department is an independent global function that performs credit reviews of its counterparties and clients. The creditprocess includes due diligence, financial analyses, reviews of past and intended trading activities, as well as internal-rating assessments. The credit reviewprocess also includes assigning counterparty or client level trading and position limits, issuer limits, country limits, and other types of credit limits to controland limit its credit exposure to individual counterparties as well as to credit concentrations. Assigned limits reflect the various elements of assessed credit riskand are revised to correspond with changes in the counterparties' credit profiles. If the Company does not receive sufficient, accurate, timely data, or fail toanalyze that data properly in its credit review process, the Company could assign improper credit limits to its counterparties, which could lead to future lossesif the counterparty does not meet its obligations to the Company.

For margined transactions, which compose a large portion of the Company's clearing business, its clients are required to maintain margin accounts withcollateral to support their open trading positions. Most clients are required to cover initial and variation margin requirements within 24 hours. Although theCompany initially establishes each client's margin requirement at the level set by the respective exchanges, the Company generally has the ability to increasethe requirements to levels the Company believe is sufficient to cover each client's open positions. To assess the adequacy of margins in changing marketenvironments, the Company conducts a variety of stress tests and, if market movements affecting client positions require, the Company requests intra-day

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margin calls. The Company also generally reserves the right to liquidate any client position immediately in the event of a failure to meet a margin call. If theCompany fails to properly monitor client positions and accurately evaluate risk exposures, it could prevent the Company from obtaining adequate initial orincreased margins from its clients sufficient to keep pace with market movements, which could then lead to uncollectable account deficits.

In line with market practices, the Company may grant secured (collateralized) and unsecured financing to some of its clients, subject to variousregulatory and internal requirements, to enable clients to post initial and variation margin as well as to provide financing in repurchase agreement transactionswith its counterparties. Generally, the margin financing lines the Company provides to clients and counterparties are uncommitted lines that the Company canrescind at any time and are granted based on supporting information such as client financials, rating, and credit due diligence. If the Company does not receivesufficient, accurate, timely data, or fails to analyze that data properly in its credit review process, the Company could assign improper financing limits to itscounterparties, which could lead to future losses if the counterparty does not meet its obligations to the Company.

When the Company acts as clearing broker, the Company is responsible to its client for the performance of the other party. The risk that its client'scounterparty may fail to perform as expected is mitigated when the Company clears through an exchange or clearinghouse because the exchange orclearinghouse becomes the other party to its transaction. If a clearing member defaults on its obligations to an exchange or clearinghouse in an amount largerthan its margin and clearing fund deposits, then the shortfall is absorbed pro rata from the deposits of other clearing members. Therefore, if the Company is amember of a clearinghouse or exchange, the Company could incur losses resulting from the defaults of other market participants. Although the Company setslimits to control these exposures at the exchange and clearinghouse, the risk is inherent in its business and is largely controlled and influenced by theregulatory bodies that impose rules on the exchanges and clearinghouses.

In addition to the credit review process, the Company employs a number of stress-testing, daily and intraday monitoring, and other techniques to closelymonitor the market environment and its clients' risks of default based upon exposures created by their open positions.

Regulatory Capital Risk

The Company's ability to provide clearing services, which is a critical part of its business, depends heavily on its ability to maintain capital at itsoperating subsidiaries, including equity capital at or above specified minimum levels required by various regulators throughout the world. Additionally,principal trading activities have higher regulatory capital requirements than agency execution and clearing activities. The Company also needs capital andliquidity to protect the Company against the risk of default by its clearing clients and against clearing and settlement payment delays caused by systemicproblems outside its control in one country or between countries. Various domestic and foreign government regulators, as well as self-regulated organizations(such as exchanges), with supervisory responsibility over its business activities require the Company to maintain specified minimum levels of regulatorycapital in its operating subsidiaries.

To mitigate this risk, the Company continuously evaluates the levels of regulatory capital at each of its operating subsidiaries and adjusts the amountsof regulatory capital as necessary to ensure compliance with all regulatory capital requirements. Regulatory authorities may increase or decrease theserequirements from time to time. The Company also maintains internal early warning levels and excess regulatory capital to accommodate periods of unusualor unforeseen market volatility, and the Company intends to continue to follow this policy. In addition, the Company monitors regulatory developmentsregarding capital requirements and prepares for increases in the required minimum levels of regulatory capital that may occur in the future. If not properlymonitored and adjusted, its regulatory capital levels could fall below the required minimum amounts set by its regulators, which could expose the Company tovarious sanctions ranging from fines and censure to partial or complete restrictions on its ability to conduct business.

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Liquidity Risk

Cash liquidity risk is the risk that, in the normal course of business, the Company would be unable to generate cash resources to meet its paymentobligations as they arise. The Company's core business, providing execution and clearing brokerage services, does not generally present substantial cashliquidity risk. However, the Company may be exposed to cash liquidity risk under adverse market conditions or unexpected events from this or its otheractivities. The Company relies on uncommitted credit lines to finance its day-to-day clearing operations. Liquidity issues, whether perceived or real, couldprompt these lenders to reduce the amount of financing the Company uses to conduct its clearing operations, which in turn could prompt the Company toreduce the amount of business the Company conducts and could accelerate client withdrawals. The Company must maintain continuous access to adequateand sufficiently liquid sources of capital, including equity capital and external committed facilities on acceptable terms. The Company also must maintain itsability to obtain capital and liquidity on reasonable terms because, if it is only available at a high cost, it could significantly increase its interest expense andimpair its earnings.

Under adverse market conditions, cash liquidity risk related to its exchange clearing activity may rise to a level where exchanges may require theCompany to satisfy obligations relating to open client positions that exceed the amount of collateral available in its clients' margin accounts. The Companyseeks to mitigate this possibility by observing all relevant exchange margin requirements, and maintaining its own- in many cases more stringent- marginrequirements intended to ensure that clients will be able to cover their positions in most reasonably-foreseeable economic environments.

The Company's policy requires it to have sufficient liquidity to satisfy all of its expected cash needs for at least one year without access to the capitalmarkets. In June 2007, the Company entered into a $1,500.0 million five-year revolving unsecured credit facility with a syndicate of banks which wasamended in June 2010 to extend the lending commitments of certain borrowers and to change the aggregate commitments under the liquidity facility to$1,200.9 million ($858.9 million of which is undrawn at June 30, 2011). In addition, in June 2011 the Company's U.S. regulated broker-dealer subsidiary,MFGI, entered into a $300.0 million 364-day secured revolving credit facility with a syndicate of lenders, all of which is undrawn at June 30, 2011. Tosupport the business' settlement and intra-day requirements, the Company also maintains committed and uncommitted credit lines with financial institutions.The Company anticipates accessing these facilities and credit lines from time to time. For additional information about the liquidity facility and theCompany's liquidity, see "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operation—Liquidity and CapitalResources."

To manage its liquidity risk, the Company has established a liquidity policy designed to ensure that the Company maintains access to sufficient, readilyavailable liquid assets and committed liquidity facilities. These facilities are available to both its unregulated and regulated subsidiaries. If the Company failsto properly evaluate the impact of adverse market conditions on its liquidity risk and adjust its liquid assets appropriately, the Company may not meet itsfinancial obligations as they become due under normal or adverse market conditions.

Operational Risk

Overview

Operational risk is the risk of loss or other adverse consequence arising from inadequate or failed internal processes, people and systems or fromexternal events. Consistent with the Company's competitors, its operations are exposed to a broad number of these types of risks which could have asignificant impact on its business. The Company further categorizes operational risk as:

• execution, delivery and process management;

• clients, products, and business practices;

• business disruption and systems failures;

• damage to physical assets;

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• employment practices and workplace safety;

• financial integrity and reporting;

• internal fraud; and

• external fraud.

Operational risk is inherent in each of the Company's business areas including revenue-generating, support and control activities; therefore, the primaryday-to-day responsibility for managing operational risk rests with these areas. Each area has established processes, systems and controls to manageoperational risk and is responsible for escalating incidents, issues, and control indicators. Reports are summarized for senior management and governancecommittees. Additionally, the Company considers the operational risk in new products, systems, and business activities as they are developed or modified.

The Company maintains a continuous and collaborative Operational Risk Management Framework which ensures that an effective environment is inplace to identify, assess, measure, monitor and mitigate operational risk across all of its business areas. The Operational Risk Committee, which is chaired bythe Global Head of Operational Risk and is a key component of the Enterprise Risk Management Governance structure, provides oversight of the OperationalRisk Management Framework and provides a forum for senior management to assess the operational risk profile of the organization. The Global Head ofOperational Risk reports to the Chief Risk Officer. The Operational Risk department is a risk management and assurance function that is independent of therevenue-generating areas. The Operational Risk department's primary objective is to develop, implement, and maintain its Operational Risk ManagementFramework. The Operational Risk department works with all business areas to help ensure transparency, awareness, and accountability of risks.

Operational Risk Management

Operational risk management is a systemic process to identify, measure, and manage operational risk. It is a continuous, iterative process, which resultsin the acceptance, mitigation or avoidance of risk. Effective operational risk management should minimize expected losses, improve the Company's ability toachieve its business objectives, and strengthen the overall risk management framework. The Operational Risk Management Framework continues to evolve toaccount for organizational changes and in response to the changing regulatory and business environment. The Company seeks to manage its operational riskthrough:

• training to increase operational risk awareness;

• engaging senior management in the identification, assessment and mitigation of operational risks;

• establishing an effective and accessible governance structure including policies, procedures and committees;

• maintaining an effective control environment;

• mandating the timely escalation of risk issues and incidents;

• communicating pro-actively with business areas, including revenue-generating, support and control functions, to discuss and identify theoperational risk profile of the businesses;

• analyzing data collected throughout the organization to assess its operational risk exposure;

• assessing and measuring risks by combining both top-down and bottom-up approaches; and

• coordination between the assurance functions including the Operational Risk and Internal Audit departments, Compliance, and SOX Compliance,as appropriate.

The Company's Operational Risk Management Framework is designed to comply with Basel 2 and continues to evolve based on the changing needs ofits business and regulatory guidance. The Company's framework includes the following practices:

• Risk identification through the escalation of incidents and issues and the reporting of key indicators;

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• Risk assessment through both top-down and bottom-up assessments across the business lines;

• Risk measurement through the qualitative and quantitative assessment of expected and unexpected exposures;

• Risk mitigation through the effective analysis of risks and identification and tracking of remedial actions and mitigating controls; and

• Risk monitoring and reporting through the analysis of information and the escalation to governance committees and senior management asappropriate.

Risk Identification

Three core components of the Operational Risk Management Framework are the Incident, Indicator, and Assessment programs which help to identifyand escalate the risks of the organization. The Company has a broad information collection process that is bound by global policies and procedures. Keyinformation is stored in a centralized database for further reporting and analysis purposes.

The Operational Risk department maintains a disciplined and robust incident escalation and reporting program. The Enterprise Risk ManagementPolicy identifies all employees as risk managers. As such, all employees have the mandate to escalate reportable incidents to their managers and theOperational Risk department. The Operational Risk department facilitates the capture of incident data which allows for useful analysis and timelydissemination of information across the organization. Additionally, external incidents, or adverse events that occur externally and do not directly impact theCompany, are monitored and considered. The Operational Risk department collects external incident data, disseminates relevant information and coordinatesdiscussions as appropriate.

Key indicators provide a monitoring tool to alert management to controls' performance, risk levels, and trends that may be indicative of risk concerns.Selected indicator data is centrally collected by the Operational Risk department.

Risk Assessment

The Company's assessment programs are designed to assess the current state in order to project future risks and impacts. The Company approaches theassessment of operational risk through periodic bottom-up and top-down processes through both individual and broader front-to-back discussions.Considering all available and relevant data and leveraging a consistent rating matrix to measure and report the results these assessments:

• provide a broader understanding and awareness of the risks, the effectiveness of the controls, and the market and business environment to whicheach business area is exposed;

• inform senior management and, as appropriate, the Board, on the current operating and control environment;

• detect risks which are not sufficiently mitigated and identify the need for (additional) remedial actions; and

• promote transparency and accountability with regard to operational risk.

Risk Measurement

By considering the inherent and residual operational risks, all available and relevant data, and the results of the core Operational Risk ManagementFramework programs, the Company measures both the potential expected and unexpected exposures. The qualitative and quantitative measures are used toestablish an operational risk profile for the organization, escalate risks that may be exceeding agreed tolerances, prioritize the remedial actions and identifyother mitigating options.

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Risk Mitigation

The Company may seek varied approaches to mitigating its operational risks including discreet action plans, insurance coverage, and holding economiccapital.

By maintaining an effective Operational Risk Management Framework, the Company is able to more readily identify current or increasing risks and bemore pro-active in mitigating those risks with discreet action plans. Based on the severity and likelihood of those risks, senior management may prioritize theactions and direct resources as needed. Those plans are monitored by the Operational Risk department to completion.

As deemed prudent, the Company seeks to mitigate the financial effect of certain potential operational risks through insurance coverage. Insurancepolicies are mapped to its operational risks and are reviewed on an annual basis by the Insurance Risk Manager, who reports directly to the Chief RiskOfficer, to ensure they are aligned to the current potential risks of the organization.

The Company's approach to economic capital continues to evolve as the Company transforms and the regulatory and business environments change.The Company may choose to calculate and hold economic capital to meet regulatory expectations or mitigate its potential exposure to extreme but unexpectedscenarios. By identifying its operational risk profile and utilizing its top-down assessment program to identify extreme but plausible risk scenarios, theCompany is able to extrapolate a capital measure with an expected confidence level. The Company's scenario analysis assessment program identifies extremebut plausible risk scenarios which are input into a model to extrapolate a capital measure with a given confidence level.

Risk Monitoring and Reporting

The Company evaluates changes to its operational risk profile and the effectiveness of the control environment, by monitoring, assessing, and reportingthe results of the Operational Risk Management Framework, SOX Compliance, and Internal Audit programs on an ongoing basis. The results of the assuranceprograms are escalated to senior management and governance committees as appropriate.

Item 4. Controls and Procedures

As of the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of the Company'smanagement, including its Chief Executive Officer and Chief Financial Officer, of the effectiveness of its disclosure controls and procedures (as defined inRule 13a-15(e) under the U.S. Securities Exchange Act of 1934 (the "Exchange Act")). Based upon that evaluation, the Company's Chief Executive Officerand Chief Financial Officer have concluded that these disclosure controls and procedures were effective as of and for the period covered by this report. Inaddition, no change in the Company's internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) occurred during its mostrecent fiscal quarter that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting.

PART II—OTHER INFORMATION Item 1. Legal Proceedings

Legal and Regulatory Matters

The Company and its subsidiaries are currently, and in the future may be, named as defendants in or made parties to various legal actions and regulatoryproceedings ("legal and regulatory matters" or "these matters"). Some of these matters that are currently pending are described below under "Description ofParticular Matters". Claims for significant monetary damages are often asserted in many of these matters involving legal actions,

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although a number of these actions seek an unspecified or indeterminate amount of damages, including punitive damages, while claims for disgorgement,penalties and other remedial sanctions may be sought by governmental or other authorities in regulatory proceedings. It is inherently difficult to predict theeventual outcomes of these matters given their complexity and the particular facts and circumstances at issue in each of them.

In view of the inherent unpredictability of outcomes in legal and regulatory matters, particularly where (1) the damages sought are unspecified orindeterminate, (2) the proceedings are in the early stages or (3) the matters involve unsettled questions of law, multiple parties or complex facts andcircumstances, there is considerable uncertainty surrounding the timing or ultimate resolution of these matters, including a possible eventual loss, fine, penaltyor business impact associated with each matter. In accordance with ASC 450, Contingencies, the Company accrues amounts for legal and regulatory matterswhere it believes they present loss contingencies that are both probable and reasonably estimable. In such cases, however, the Company may be exposed tolosses in excess of any amounts accrued and may need to adjust the accruals from time to time to reflect developments that could affect its estimate ofpotential losses. Moreover, in accordance with ASC 450, if the Company does not believe that the potential loss from a particular matter is both probable andreasonably estimable, it does not make an accrual and will monitor the matter for any developments that would make the loss contingency both probable andreasonably estimable. The actual results of resolving these matters may involve losses that are substantially higher than amounts accrued (and insurancecoverage, if any).

Although the Company has made accruals for only some of the legal and regulatory matters, it believes that loss contingencies may, in the future, bereasonably possible for a number of these matters, including both matters for which no accruals have been made and matters for which they have. Under ASC450, an event is "reasonably possible" if the chance of the event occurring is more than "remote" or "slight." For matters as to which the Company believes aloss is reasonably possible and estimable, it currently estimates that the range of reasonably possible losses, in excess of amounts accrued, could be up toapproximately $150.0 million in the aggregate. This estimated range, however, is subject to the following considerations. For one of these matters, althoughthe Company believes that losses are reasonably possible, it is currently unable to make a reasonable estimate of such losses. The Company discusses thismatter below under "Description of Particular Matters—In re: Platinum and Palladium Commodities Litigation."

The estimated range also does not include the BMO matter, which is discussed below under "Description of Particular Matters—Bank of Montreal("BMO")". While the Company currently believes that losses are reasonably possible for the BMO matter, the Company believes it is difficult to make anyestimate of the potential losses at this stage of the proceedings, other than to refer to a range up to the amount of the claims made against the Company in thatmatter. Those claims, for which the Company has not made any accruals, are described in the next section under the heading relating to the BMO matter.

For the matters that are covered by the estimated range, the range reflects the following amounts. For some of the covered matters, where the Companybelieves it is able to do so, the Company has estimated the losses based on its current assessment of the particular facts and circumstances and legal issuesrelating to the matters as known and understood by the Company. For each of the remaining covered matters, however, the estimated range simply reflects theamount of compensatory damages claimed against the Company in the matter or, where such damages are not specified or the Company believes it isotherwise appropriate, the Company's estimate of the value of the contract, account or transaction that is the subject of the matter. Although some of thecovered matters include claims for punitive or statutory (e.g., treble) damages, the estimated range does not reflect any potential losses from claims of thiskind because at this point the Company believes amounts are too remote or unpredictable. In addition, a number of covered matters involve claims orcounterclaims relating to debit balances in customer accounts, in which the Company has asserted or intends to assert offsetting claims to recover the debits,and for matters of this kind the estimated range reflects only the net amount of the claims against the Company. Also, the estimated range does not reflect anypotential losses from the matters described below in the Description of Particular Matters under the headings "Unauthorized Trading Incident ofFebruary 26/27 2008—Class Action Suits" (as to which the parties have agreed to a preliminary settlement,

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although the settlement remains subject to court approval and other conditions, and cannot be assured) and "Agape World" (which, as it relates to theCompany, was dismissed by the lower court but remains subject to possible future appeal).

Finally, the estimated range reflects losses only in excess of amounts currently accrued for the covered matters, does not give effect to any potentialinsurance coverage, which might reduce the amounts owed in some contingencies, and does not reflect any legal fees or other expenses incurred in defendingor investigating any matters (which at times have been and in the future could be substantial) or that may be demanded by a counterparty.

The losses reflected in the estimated range could occur over a period of several years or longer. The estimated range is based on currently availableinformation, is subject to modification in light of future developments and changes in the Company's management's assessments and may not reflect the actualoutcome of any matters. For all the reasons described above, the estimated range does not represent the Company's maximum loss exposure from legal andregulatory matters.

Description of Particular Matters

Unauthorized Trading Incident of February 26/27, 2008

One of the brokers of the Company's U.S. operating subsidiary, MFGI, Evan Dooley, trading for his own account out of a Memphis, Tennessee branchoffice through one of MFGI's front end order entry systems, Order Express, put on a significant wheat futures position during the late evening of February 26,2008 and early morning of February 27, 2008. The positions were liquidated at a loss of $141.0 million on February 27, 2008. The trades were unauthorizedand because the broker had no apparent means of paying for the trades, MFGI, as a clearing member of the exchange, was required to pay the $141.0 millionshortfall (the "Dooley Trading Incident"). As a result of the Dooley Trading Incident:

• Class Action Suits. The Company, Man Group plc (former shareholder and parent company), certain of its current and former officers anddirectors, and certain underwriters for the IPO have been named as defendants in five actions filed in the United States District Court for theSouthern District of New York. These actions, which purport to be brought as class actions on behalf of purchasers of MF Global stock betweenthe date of the IPO and February 28, 2008, seek to hold defendants liable under §§ 11, 12 and 15 of the Securities Act of 1933 for allegedmisrepresentations and omissions related to the Company's risk management and monitoring practices and procedures. The five purportedshareholder class actions have been consolidated for all purposes into a single action. The Company made a motion to dismiss which had beengranted, with plaintiff having a right to replead and/or appeal the dismissal. Plaintiffs made a motion to replead by filing an amended complaint,which was denied. Plaintiffs appealed. The Second Circuit Court of Appeals vacated the decision and remanded the case for furtherconsideration. The parties engaged in mediation and have agreed to a preliminary settlement, which is subject to various customary conditions,including confirmatory discovery, preliminary approval by the United States District Court for the Southern District of New York, notice to classmembers, class member opt-out thresholds, a final hearing, and final approval by the District Court. The settlement provides for a total paymentof $90.0 million to plaintiffs. Of this total payment, $2.5 million is payable by the Company and has been accrued.

• Insurance Claim. MFGI filed a claim for payment of its $141.0 million loss plus statutory interest under its Fidelity Bond Insurance (the "Bond"),which provides coverage for wrongful or fraudulent acts of employees, seeking indemnification for the loss on the Dooley trading incident. Aftermonths of investigation, MFGI's Bond insurers denied payment of this claim based on certain definitions and exclusions to coverage in the Bond.They also initiated an action against MFGI in the Supreme Court of the State of New York, New York County, seeking a declaration that there isno coverage for this loss under the Bond. MFGI believes the insurers' position to be in error and filed a counterclaim in order to

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seek to enforce its right to payment in court. The Bond insurers sought partial summary judgment, which the Court denied. The Bond insurershave filed a Notice of Appeal to the Appellate Division, First Department and also filed a motion to Renew or Reargue with the Supreme Court,challenging the portion of the decision that found that Dooley was an employee of the Company. Insurers' motion to Renew or Reargue has beendenied and they have filed a Notice of Appeal on that issue as well.

Bank of Montreal ("BMO")

On August 28, 2009, BMO instituted suit against MFGI and its former broker, Joseph Saab (as well as a firm named Optionable, Inc. ("Optionable")and five of its principals or employees), in the United States District Court for the Southern District of New York. In its complaint, BMO asserts variousclaims based upon allegations that Optionable and MFGI provided BMO with price indications on natural gas option contracts that BMO allegedly believedwere independent but the indications had been provided by BMO's trader, David Lee, and were passed on to BMO, thereby enabling Lee substantially toovervalue BMO's natural gas options book. BMO further alleges that MFGI and Saab aided and abetted Lee's fraud and breach of his fiduciary duties bysending price indications to BMO. There are additional separate claims against other defendants. The Complaint seeks to hold all defendants jointly andseverally liable. Although the Complaint does not specify an exact damage claim, BMO claims that the cash loss resulting from Lee's fraudulent tradingactivity, which allegedly could have been prevented had BMO received "correct pricing information", is in excess of $500.0 million. In addition, BMO claimsthat it would not have paid brokerage commissions to MFGI (and Optionable), would not have continued Lee and his supervisor as employees at substantialsalaries and bonuses, and would not have incurred substantial legal costs and expenses to deal with the overvaluation of its natural gas options book but fordefendants' alleged conduct. All defendants, including MFGI, made a motion to dismiss the complaint, which was denied by the court.

Amacker v. Renaissance Asset Management Fund et. al.

In December 2007, MFGI, along with four other futures commission merchants ("FCMs"), was named as a defendant in an action filed in the UnitedStates District Court in Corpus Christi, Texas by 47 individuals who were investors in a commodity pool (RAM I LLC) operated by Renaissance AssetManagement LLC. The complaint alleges that MFGI and the other defendants violated the Commodity Exchange Act and alleges claims of negligence,common law fraud, violation of a Texas statute relating to securities fraud and breach of fiduciary duty for allegedly failing to conduct due diligence on thecommodity pool operator and commodity trading advisor, having accepted executed trades directed by the commodity trading advisor, which was engaged ina fraudulent scheme with respect to the commodity pool, and having permitted the improper allocation of trades among accounts. The plaintiffs claimdamages of $32.0 million, plus exemplary damages, from all defendants. All of the FCM defendants moved to dismiss the complaint for failure to state aclaim upon which relief may be granted. Following an initial pre-trial conference, the court granted plaintiffs leave to file an amended complaint. On May 9,2008, plaintiffs filed an amended complaint in which plaintiffs abandoned all claims except a claim alleging that the FCM defendants aided and abettedviolations of the Commodity Exchange Act. Plaintiffs now seek $17.0 million in claimed damages plus exemplary damages from all defendants. MFGI filed amotion to dismiss the amended complaint, which was granted by the court and appealed by the plaintiffs.

Voiran Trading Limited

On December 29, 2008, the Company received a letter before action from solicitors on behalf of Voiran Trading Limited ("Voiran") which has nowbrought an LME arbitration proceeding. The claimant alleges that the Company's U.K. affiliate was grossly negligent in advice it gave to Voiran betweenApril 2005 and April 2006 in relation to certain copper futures contracts and claims $37.6 million in damages. This arbitration is scheduled for 2012.

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Sentinel Bankruptcy

The Liquidation Trustee ("Trustee") for Sentinel Management Group, Inc. ("Sentinel") sued MFGI in June 2009 on the theory that MFGI's withdrawalof $50.2 million within 90 days of the filing of Sentinel's bankruptcy petition on August 17, 2007 is a voidable preference under Section 547 of theBankruptcy Code and, therefore, recoverable by the Trustee, along with interest and costs. MFGI believes there are meritorious defenses available to it and itintends to resist the Trustee's attempt to recover those funds from MFGI. In addition, to the extent the Trustee recovered any funds from MFGI it would beable to assert an offsetting claim in that amount against the assets available in Sentinel's bankruptcy case.

Agape World

In May 2009, investors in a venture set up by Nicholas Cosmo sued Bank of America and MFGI, among others, in the United States District Court forthe Eastern District of New York, in two separate class actions and one case brought by certain individuals, alleging that MFGI, among others, aided andabetted Cosmo and related entities in a Ponzi scheme in which investors lost $400.0 million. MFGI made motions to dismiss all of these cases which weregranted with prejudice. The time when plaintiffs are able to appeal the dismissal will not begin to run until the action against the remaining defendants isdecided.

Phidippides Capital Management/Mark Trimble

In the late spring of 2009, MFGI was sued in Oklahoma State Court by customers who were substantial investors with Mark Trimble and/orPhidippides Capital Management. Plaintiffs allege that Trimble and Phidippides engaged in a Ponzi scheme and that MFGI "materially aided and abetted"Trimble's and Phidippides' violations of the anti-fraud provisions of the Oklahoma securities laws. They are seeking damages in the amount of $20.0 million.MFGI made a motion to dismiss which was granted by the court. Plaintiffs appealed. The Court of Civil Appeals for the State of Oklahoma upheld MFGI'sdismissal. Plaintiffs filed a petition for certiorari with the Supreme Court of Oklahoma, which was denied. On July 15, 2011, plaintiffs filed a Third AmendedPetition against MFGI and seek to assert or reassert claims against MFGI under the Oklahoma Securities Act and a new claim of common law negligence. Ithas reduced the damages claim to $7.0 million.

In re: Platinum and Palladium Commodities Litigation

On August 4, 2010, MFGI was added as a defendant to a consolidated class action complaint filed against Moore Capital Management and relatedentities in the United States District Court for the Southern District of New York which alleged claims of manipulation and aiding and abetting manipulationin violation of the Commodities Exchange Act. Specifically, the complaint alleged that, between October 25, 2007 and June 6, 2008, Moore Capital directedMFGI, as its executing broker, to enter "large" market on close orders (at or near the time of the close) for platinum and palladium futures contracts, whichallegedly caused artificially inflated prices. On August 10, 2010, MFGI was added as a defendant to a related class action complaint filed against the Moore-related entities on behalf of a class of plaintiffs who traded the physical platinum and palladium commodities in the relevant time frame, which alleges pricefixing under the Sherman Act and violations of the civil Racketeer Influenced and Corrupt Organizations Act. On September 30, 2010 plaintiffs filed anamended consolidated class action complaint that includes all of the allegations and claims identified above on behalf of subclasses of traders of futurescontracts of platinum and palladium and physical platinum and palladium. A motion to dismiss was heard on February 4, 2011. Plaintiffs' claimed damageshave not been quantified.

Marion Hecht as Receiver for Joseph Forte, L.P.

On December 21, 2010, Marion Hecht, as Receiver for Joseph Forte, L.P. (the "Partnership"), filed a complaint against MFGI in the United StatesDistrict Court for the Eastern District of Pennsylvania that alleges one claim of negligence. Specifically, the complaint alleges that the Partnership had atrading account with MFGI

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and that MFGI violated its duties imposed by state law and under the Commodity Exchange Act by failing to recognize that the Partnership was not properlyregistered with the CFTC or the National Futures Association, or take reasonable action in response to a false claimed exemption, failing to require thePartnership to provide financial reports or other financial records, failing to make sufficient inquiries or take action regarding the registration whendiscrepancies in Partnership documents existed, failing to reasonably recognize or to take action upon the unusual activity in the Partnership account, and thatMFGI's conduct enabled the Partnership to operate a Ponzi scheme and cause damage to the investors. The Receiver claims MFGI caused losses in excess of$10.0 million. MFGI filed a motion to dismiss that was denied. MFGI has filed a motion for judgment on the pleadings.

In re: Agape World Inc. Bankruptcy

On January 28, 2011, Kenneth Silverman as Chapter 7 Trustee of Agape World, Inc. (a substantively consolidated bankruptcy estate of various Agapeentities, collectively, "Agape") filed a complaint against MFGI in the United States Bankruptcy Court, Eastern District of New York seeking to recover thetransfers made by Agape to MFGI totaling $27.1 million plus any fees earned in connection with the trades. Specifically, the Trustee alleges that the transfersand the fees received by MFGI are recoverable as fraudulent conveyances because MFGI allegedly received these funds not in good faith. The basis for thealleged bad faith is that MFGI failed to conduct sufficient diligence when opening the account, failed to respond to red flags about how account principalNicholas Cosmo was using Agape's funds and failed to provide proper oversight and monitoring which, if conducted, would have caused termination of theaccounts and trading, and prevented losses to the investors.

US Mortgage Corp et al. via Anthony Calascibetta as Liquidating Trustee

On February 22, 2011, Anthony Calascibetta, Liquidating Trustee for U.S. Mortgage Corp. and CU National Mortgage, LLC ("Debtors") filed acomplaint against MFGI in the United States Bankruptcy Court, District of New Jersey, seeking to avoid and recover transfers in the total amount of $4.8million. Specifically, the complaint alleges the Debtors utilized MFGI in connection with the purchase and sale of securities, and that the sums expended forthe securities are recoverable by the Liquidating Trustee as fraudulent transfers intended to hinder or defraud creditors of the Debtors, or under state law, andthat MFGI intentionally disregarded unspecified facts that informed MFGI and its agents that the transfers in question were fraudulent and unauthorized.MFGI has filed a motion to dismiss. The Liquidating Trustee recently filed a motion to amend the complaint to seek recovery of an additional $1.6 million intransfers.

German Introducing-Broker Litigation

In recent years, two of the Company's subsidiaries have been named as defendants in numerous lawsuits filed in German federal courts by plaintiffswho had accounts introduced by German introducing brokers. Plaintiffs allege that the introducing brokers had contractual relationships with the twosubsidiaries, and executed equity options and other derivatives transactions for them through the subsidiaries, and that the subsidiaries should be liable forcertain alleged tortious acts of both the introducing brokers and the subsidiaries. Plaintiffs seek to recover investment losses, statutory interest, attorney's feesand costs. The Company has not conducted retail business through German introducing firms since 2006. None of the damages claimed by any individualclaimant is material and to date many of the claims have been settled or adjudicated with minimal impact on the Company, however, the number of theselawsuits has increased in the past year. In addition, in 2010, the German Supreme Court ruled in favor of plaintiffs in a similar case against another firm andsince that time the trend in cases involving the Company's subsidiaries has increasingly been to find foreign clearing brokers liable for the alleged tortiousconduct of local introducing brokers.

Other Matters

In addition to the matters described above, the Company and its subsidiaries currently are, and in the future may be, named as defendants or otherwisemade parties to various legal actions and regulatory matters that arise

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in the ordinary course of business. Aside from the matters described above under "Description of Particular Matters" and those reflected in the estimatedrange of reasonably possible losses, the Company does not believe, on the basis of management's current knowledge and assessments, that it is party to anypending or threatened legal or regulatory matters that, either individually or in the aggregate, after giving effect to applicable accruals and any insurancecoverage, will have a material adverse effect on the Company's consolidated financial condition, operating results or cash flows.

Item 1A. RISK FACTORS

For a discussion of the Company's potential risks and uncertainties, see information in Part I, "Item 1A. Risk Factors" in the Company's Annual Reporton Form 10-K for the year ended March 31, 2011, filed with the SEC, which is accessible on the Securities and Exchange Commission's website atwww.sec.gov. If any of the risks discussed in the Company's 2011 Form 10-K actually occur, its business, financial condition, operating results or cash flowscould be materially adversely affected.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. (Removed and Reserved)

None.

Item 5. Other Information Item 6. Exhibits

ExhibitNumber Description

Exhibit 10.1

$300,000,000 Revolving Credit Facility, dated as of June 29, 2011, among MF Global Inc., MF Global Holdings Ltd., MF Global FinanceUSA Inc., the Several Lenders from Time to Time Parties thereto, Harris N.A., Citigroup Global Markets Inc., Bank of America, N.A.,and JPMorgan Chase Bank, N.A.

Exhibit 10.2 Security Agreement, dated as of June 29, 2011, by and among MF Global Inc. and JPMorgan Chase Bank, N.A.Exhibit 10.3

Guaranty, dated as of June 29, 2011, made by each of MF Global Holdings Ltd., MF Global Inc., and MF Global Finance USA Inc. infavor of JPMorgan Chase Bank, N.A. and the lenders party to the $300,000,000 Revolving Credit Facility.

Exhibit 31.1 Certification of Jon S. Corzine, Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.Exhibit 31.2 Certification of Henri J. Steenkamp, Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.Exhibit 32.1

Certification of Jon S. Corzine, Chief Executive Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section1350

Exhibit 32.2 Certification of Henri J. Steenkamp, Chief Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by theundersigned, thereunto duly authorized. MF GLOBAL HOLDINGS LTD.By: /s/ Jon S. Corzine Name: Jon S. CorzineTitle: Chief Executive OfficerBy: /s/ Henri J. Steenkamp Name: Henri J. SteenkampTitle: Chief Financial Officer

Date: August 3, 2011

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Exhibit 10.1

EXECUTION VERSION

$300,000,000REVOLVING CREDIT FACILITY

dated as of

June 29, 2011

among

MF GLOBAL INC.,as Borrower

MF GLOBAL HOLDINGS LTD.,

MF GLOBAL FINANCE USA INC.

The Several Lenders from Time to Time Parties Hereto,

HARRIS, N.A.,

CITIGROUP GLOBAL MARKETS INC.,and

BANK OF AMERICA. N.Aas Syndication Agents

- and -

JPMORGAN CHASE BANK, N.A.,as Administrative Agent

J.P. MORGAN SECURITIES LLC,BMO CAPITAL MARKETS

CITIGROUP GLOBAL MARKETS INC. andMERRILLYNCH, PIERCE, FENNER & SMITH INCORPORATED

as Joint Lead Arrangers and Joint Bookrunners

TABLE OF CONTENTS

Page

ARTICLE I

Definitions

SECTION 1.01. Defined Terms 1 SECTION 1.02. Classification of Loans and Borrowings 14 SECTION 1.03. Terms Generally 14 SECTION 1.04. Accounting Terms; GAAP 15

ARTICLE II

The Credits

SECTION 2.01. Commitments 15 SECTION 2.02. Loans and Borrowings 15 SECTION 2.03. Requests for Revolving Borrowings 16 SECTION 2.04. Funding of Revolving Borrowings 17 SECTION 2.05. Swingline Loans 17 SECTION 2.06. Interest Elections 19 SECTION 2.07. Termination and Reduction of Commitments 20 SECTION 2.08. Repayment of Loans; Evidence of Debt 20 SECTION 2.09. Optional Prepayment of Loans 21 SECTION 2.10. Daily Calculation of Loan Value; Mandatory Prepayments 21 SECTION 2.11. Fees 22 SECTION 2.12. Interest 22 SECTION 2.13. Alternate Rate of Interest 23 SECTION 2.14. Increased Costs 23 SECTION 2.15. Break Funding Payments 24 SECTION 2.16. Taxes 25 SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-offs 26 SECTION 2.18. Mitigation Obligations; Replacement of Lenders 27 SECTION 2.19. Defaulting Lenders 27 SECTION 2.20. Additional Commitments 28

ARTICLE III

Representations and Warranties

SECTION 3.01. Organization; Powers 29 SECTION 3.02. Authorization; Enforceability 29 SECTION 3.03. Governmental Approvals; No Conflicts 29 SECTION 3.04. Financial Condition; No Material Adverse Change 29 SECTION 3.05. Properties 30 SECTION 3.06. Litigation and Environmental Matters 30 SECTION 3.07. Compliance with Laws and Agreements 30 SECTION 3.08. Investment Company Status 31 SECTION 3.09. Taxes 31 SECTION 3.10. ERISA 31

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Page

SECTION 3.11. Disclosure 31 SECTION 3.12. Federal Regulations 31 SECTION 3.13. Purpose of Loans 31 SECTION 3.14. Material Licenses and Memberships 31

ARTICLE IV

Conditions

SECTION 4.01. Effective Date 31 SECTION 4.02. Each Credit Event 32

ARTICLE V

Affirmative Covenants

SECTION 5.01. Financial Statements; Ratings Change and Other Information 33 SECTION 5.02. Notices of Material Events 34 SECTION 5.03. Existence; Conduct of Business; Material Licenses and Membership 35 SECTION 5.04. Payment of Obligations 35 SECTION 5.05. Maintenance of Properties; Insurance 35 SECTION 5.06. Books and Records; Inspection Rights 35 SECTION 5.07. Compliance with Laws 35

ARTICLE VI

Negative Covenants

SECTION 6.01. Financial Covenant 36 SECTION 6.02. Indebtedness 36 SECTION 6.03. Liens 37 SECTION 6.04. Fundamental Changes 38 SECTION 6.05. Transactions with Affiliates 38 SECTION 6.06. Regulatory Capital 38 SECTION 6.07. Minimum Liquidity Ratio 38 SECTION 6.08. Pledged Eligible Asset Deficiencies 39

ARTICLE VII

Events of Default

ARTICLE VIII

The Administrative Agent

ARTICLE IX

Miscellaneous SECTION 9.01. Notices 43 SECTION 9.02. Waivers; Amendments 44

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SECTION 9.03. Expenses; Indemnity; Damage Waiver 45 SECTION 9.04. Successors and Assigns 46 SECTION 9.05. Survival 48 SECTION 9.06. Counterparts; Integration; Effectiveness 49 SECTION 9.07. Severability 49 SECTION 9.08. Right of Setoff 49 SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process 49 SECTION 9.10. WAIVER OF JURY TRIAL 50 SECTION 9.11. Headings 50 SECTION 9.12. Confidentiality 50 SECTION 9.13. USA PATRIOT Act 51 SECTION 9.14. Releases of Guarantees and Liens 51

SCHEDULES:

Schedule 1.01 – Eligible AssetsSchedule 2.01 – CommitmentsSchedule 2.04 – Swingline CommitmentsSchedule 3.06 – Disclosed MattersSchedule 6.02 – Existing IndebtednessSchedule 6.03 – Existing LiensSchedule 6.05 – Transactions with Affiliates

EXHIBITS:

Exhibit A – Form of GuarantyExhibit B – Form of Security AgreementExhibit C – Form of Opinion of Sullivan & Cromwell LLP, special New York counsel for the Parent, MF USA and the BorrowerExhibit D-1 – Form of Closing CertificateExhibit D-2 – Form of Secretary's CertificateExhibit E – Form of Pledged Eligible Assets NoticeExhibit F – Form of Assignment and Assumption

iii

REVOLVING CREDIT FACILITY (this "Agreement"), dated as of June 29, 2011, among:

(a) MF GLOBAL INC., a New York corporation (the "Borrower");

(b) MF GLOBAL HOLDINGS LTD., a Delaware corporation (the "Parent");

(c) MF GLOBAL FINANCE USA INC., a New York corporation ("MF USA");

(d) the several banks and other financial institutions from time to time parties to this Agreement (the "Lenders");

(e) HARRIS, N.A., CITIGROUP GLOBAL MARKETS INC., and BANK OF AMERICA. N.A. as syndication agents (each, in such capacity, a"Syndication Agent"); and

(f) JPMORGAN CHASE BANK, N.A., as administrative agent for the Lenders hereunder (in such capacity, the "Administrative Agent").

The parties hereto agree as follows:

ARTICLE I

Definitions

SECTION 1.01. Defined Terms. As used in this Agreement, the following terms have the meanings specified below:

"ABR", when used in reference to any Loan, refers to whether such Loan is bearing interest at a rate determined by reference to the AlternateBase Rate.

"Additional Commitment" has the meaning assigned to such term in Section 2.20(a).

"Additional Commitment Lender" has the meaning assigned to such term in Section 2.20(a).

"Administrative Agent" has the meaning assigned to such term in the preamble hereto.

"Administrative Questionnaire" means an Administrative Questionnaire in a form supplied by the Administrative Agent.

"Affiliate" means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or isControlled by or is under common Control with the Person specified.

"Agreement" has the meaning assigned to such term in the preamble hereto.

"Alternate Base Rate" means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal FundsEffective Rate in effect on such day plus 1/2 of 1% and (c) the Eurocurrency Rate on such day (or, if such day is not a Business Day, the immediatelypreceding Business Day) for a one-month Interest Period commencing two Business Days thereafter plus 1%. Any change in the Alternate Base Rate due to achange in the Prime Rate, the Federal Funds

Effective Rate or such Eurocurrency Rate shall be effective from and including the effective date of such change in the Prime Rate, the Federal FundsEffective Rate or such Eurodollar Rate, respectively.

"Applicable Margin" means, with respect to (i) ABR Loans, 0.25% and (ii) Eurocurrency Loans and Fed Funds Rate Loans, 1.25%.

"Applicable Percentage" means, with respect to any Lender, the percentage of the total Commitments represented by such Lender's Commitment;provided that in the case of Section 2.19 when a Defaulting Lender shall exist, "Applicable Percentage" shall mean the percentage of the total Commitments(disregarding any Defaulting Lender's Commitment) represented by such Lender's Commitment. If the Commitments have terminated or expired, theApplicable Percentages shall be determined based upon the Commitments most recently in effect, giving effect to any assignments and to any Lender's statusas a Defaulting Lender at the time of determination.

"Approved Fund" has the meaning assigned to such term in Section 9.04.

"Assignment and Assumption" means an assignment and assumption entered into by a Lender and an assignee (with the consent of any partywhose consent is required by Section 9.04), and accepted by the Administrative Agent, in the form of Exhibit F or any other form approved by theAdministrative Agent.

"Availability Period" means the period from and including the Effective Date to but excluding the earlier of the Maturity Date and the date oftermination of the Commitments.

"Bankruptcy Event" means, with respect to any Person, when such Person becomes the subject of a bankruptcy or insolvency proceeding, or hashad a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization orliquidation of its business appointed for it, or, in the reasonable determination of the Administrative Agent, has taken any action in furtherance of, orindicating its consent to, approval of, or acquiescence in, any such proceeding or appointment, provided that a Bankruptcy Event shall not result solely byvirtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof,provided, further, that such ownership interest does not result in or provide such Person with immunity from the jurisdiction of courts within the United Statesor from the enforcement of judgments or writs of attachment on its assets or permit such Person (or such Governmental Authority or instrumentality) to reject,repudiate, disavow or disaffirm any contracts or agreements made by such Person.

"Board" means the Board of Governors of the Federal Reserve System of the United States of America.

"Borrower" has the meaning assigned to such term in the preamble hereto.

"Borrowing" means (a) Revolving Loans of the same Type, made, converted or continued on the same date and, in the case of EurocurrencyLoans, as to which a single Interest Period is in effect or (b) a Swingline Loan.

"Borrowing Request" means a request by the Borrower for a Borrowing in accordance with Section 2.03.

"Business Day" means, with respect to any transaction hereunder, any day that is not a Saturday, Sunday or other day on which commercialbanks in New York City are authorized or required

2

by law to remain closed; provided that, when used in connection with a Eurocurrency Loan, the term "Business Day" shall also exclude any day on whichbanks are not open for dealings in dollar deposits in the London interbank market.

"Capital Lease Obligations" of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or otherarrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted foras capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined inaccordance with GAAP.

"Change in Control" means (a) occupation of a majority of the seats (other than vacant seats) on the board of directors of the Parent by Personswho were neither (i) directors on the date hereof nor (ii) appointed or nominated by directors (x) so nominated or appointed or (y) nominated or appointed inreliance on the foregoing clause (x), (b) any Person or "group" (within the meaning of Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, asin effect on the Effective Date), shall have acquired beneficial ownership of greater than or equal to 50% on a fully diluted basis of the voting or economicinterest in the Parent's capital stock or (c) the Parent shall cease to own, directly or indirectly, all of the capital stock of the Borrower.

"Change in Law" means (a) the adoption of any law, rule or regulation after the date of this Agreement, (b) any change in any law, rule orregulation or in the interpretation or application thereof by any Governmental Authority after the date of this Agreement or (c) compliance by any Lender withany request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement,provided however, that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests,rules, guidelines, requirements and directives thereunder, issued in connection therewith or in implementation thereof, and (ii) all requests, rules, guidelines,requirements and directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similarauthority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to a "Change in Law"regardless of the date enacted, adopted, issued or implemented.

"Class" means, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, areRevolving Loans or Swingline Loans.

"Code" means the Internal Revenue Code of 1986, as amended from time to time.

"Collateral" means the assets of the Borrower with respect to which a Lien is purported to be granted in favor of the Administrative Agentpursuant to the Security Agreement.

"Commitment" means, with respect to each Lender, the commitment of such Lender to make Revolving Loans and participate in SwinglineLoans hereunder, expressed as an amount representing the maximum aggregate amount of such Lender's Revolving Credit Exposures hereunder, as suchcommitment may be (a) reduced from time to time pursuant to Section 2.07 and (b) reduced or increased from time to time pursuant to assignments by or tosuch Lender pursuant to Section 9.04. The initial amount of each Lender's Commitment is set forth on Schedule 2.01, or in the Assignment and Assumptionpursuant to which such Lender shall have assumed its Commitment, as applicable. The initial aggregate amount of the Lenders' Commitments is$300,000,000.

"Consolidated Tangible Net Worth" means, at any date, all amounts that would, in conformity with GAAP, be included in the consolidatedGAAP financial statements of the Parent or the

3

Borrower, as the case may be, and its subsidiaries (if any) under stockholders' equity (or comparable caption) at such date less the amount of all intangibleitems included therein, including, without limitation, goodwill, franchises, licenses, patents, trademarks, trade names, copyrights, service marks, brand namesand write-ups of assets.

"Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person,whether through the ability to exercise voting power, by contract or otherwise. "Controlling" and "Controlled" have meanings correlative thereto.

"Credit Party" means the Administrative Agent or any Swingline Lender.

"Customer Deficiency" has the meaning assigned to such term in Section 2.10

"Customer Loan" means, at any date, any Loan which has been designated pursuant to Section 2.03 or Section 2.05(b) (or redesignated pursuantto Section 6 of the Security Agreement), as the case may be, by the Borrower as a "Customer Loan". Notwithstanding anything herein to the contrary, a Loanmay not be designated or redesignated, as the case may be, as a Customer Loan to the extent that such designation or redesignation would cause the Borrowerto violate any Requirement of Law applicable to it.

"Customer Pledged Eligible Asset" means any Eligible Asset designated as a "Customer Pledged Eligible Asset" in the relevant Pledged EligibleAssets Notice that has been pledged to the Administrative Agent for the benefit of the Lenders to secure the obligations of the Borrower in respect of theCustomer Loans pursuant to the terms of the Security Agreement.

"Customer Revolving Credit Exposure" means, with respect to any Lender at any time, the aggregate outstanding principal amount of suchLender's Revolving Loans and Swingline Exposure at such time designated as Customer Loans.

"Default" means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured orwaived, become an Event of Default.

"Defaulting Lender" means any Lender that (a) has failed, within two Business Days of the date required to be funded or paid, to (i) fund anyportion of its Loans, (ii) fund any portion of its participations in Swingline Loans or (iii) pay over to any Credit Party any other amount required to be paid byit hereunder, unless, in the case of clause (i) above, such Lender notifies the Administrative Agent in writing that such failure is the result of such Lender'sgood faith determination that a condition precedent to funding (specifically identified and including the particular default, if any) has not been satisfied,(b) has notified the Parent, the Borrower or any Credit Party in writing, or has made a public statement to the effect, that it does not intend or expect to complywith any of its funding obligations under this Agreement (unless such writing or public statement indicates that such position is based on such Lender's goodfaith determination that a condition precedent (specifically identified and including the particular default, if any) to funding a loan under this Agreementcannot be satisfied) or generally under other agreements in which it commits to extend credit, (c) has failed, within three Business Days after request by aCredit Party, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply with its obligations (and isfinancially able to meet such obligations) to fund prospective Loans and participations in then outstanding Swingline Loans under this Agreement, providedthat such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon such Credit Party's receipt of such certification in form and substancesatisfactory to it and the Administrative Agent, or (d) has become the subject of a Bankruptcy Event.

4

"Deficiency" has the meaning assigned to such term in Section 2.10.

"Deficiency Notice" has the meaning assigned to such term in Section 2.10.

"Disclosed Matters" means the actions, suits and proceedings and the environmental matters disclosed in Schedule 3.06.

"Dollars" or "$" refers to lawful money of the United States of America.

"DTC" means The Depository Trust Company and its successors and assigns.

"Effective Date" means the date on which the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 9.02).

"Eligible Assets" means, at any time, securities, of the types listed on Schedule 1.01 and subject to the limitations provided therein.

"Environmental Laws" means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions or binding agreementsissued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, the management, release or threatened release ofany Hazardous Material or to human health matters.

"Environmental Liability" means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation,fines, penalties or indemnities), of the Parent or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any Environmental Law,(b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) therelease or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant towhich liability is assumed or imposed with respect to any of the foregoing.

"Equity Interests" means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests ina trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any suchequity interest.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time.

"ERISA Affiliate" means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employerunder Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer underSection 414 of the Code.

"ERISA Event" means (a) any "reportable event", as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan(other than an event for which the 30 day notice period is waived); (b) the existence with respect to any Plan of an "accumulated funding deficiency" (asdefined in Section 412 of the Code or Section 302 of ERISA) and, on and after the effectiveness of the Pension Act, any failure by any Plan to satisfy theminimum funding standard (within the meaning of Section 412 of the Code or Section 302 of ERISA) applicable to such Plan, in each case, whether or notwaived; (c) the filing pursuant to Section 412(d) of the Code (or, on and after the effectiveness of the Pension Act, Section 412(c) of the Code) orSection 303(d) of ERISA (or, on and

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after the effectiveness of the Pension Act, Section 302(c) of ERISA) of an application for a waiver of the minimum funding standard with respect to any Plan;(d) on and after the effectiveness of the Pension Act, a determination that any Plan is, or is expected to be, in "at-risk" status (as defined in Section 303(i)(4) ofERISA or Section 430(i) of the Code); (e) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respectto the termination of any Plan; (f) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to anintention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (g) the incurrence by the Borrower or any of its ERISA Affiliates of anyliability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (h) the receipt by the Borrower or any ERISA Affiliateof any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of WithdrawalLiability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA or,after the effectiveness of the Pension Act, in endangered or critical status, within the meaning of Section 305 of ERISA.

"Eurocurrency", when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, arebearing interest at a rate determined by reference to the Eurocurrency Rate.

"Eurocurrency Loans" means Loans the rate of interest applicable to which is based upon the Eurocurrency Rate.

"Eurocurrency Rate" means with respect to each day during each Interest Period pertaining to a Eurocurrency Loan, the rate per annumdetermined on the basis of the rate for deposits for Dollars for a period equal to such Interest Period commencing on the first day of such Interest Periodappearing on LIBOR01 of the Reuters Screen (or on any successor or substitute page of such Page, or any successor to or substitute for such Page, providingrate quotations comparable to those currently provided on such page of such Service, as determined by the Administrative Agent from time to time forpurposes of providing quotations of interest rates applicable to dollar deposits in the London interbank market) at approximately 11:00 a.m., London time, twoBusiness Days prior to the beginning of such Interest Period. In the event that such rate does not appear on LIBOR01, the "Eurocurrency Rate" shall bedetermined by reference to such other comparable publicly available service for displaying eurocurrency rates as may be selected by the Administrative Agentor, in the absence of such availability, by reference to the rate at which the Administrative Agent is offered deposits in the relevant currency at or about 11:00a.m., London time, two Business Days prior to the beginning of such Interest Period in the interbank eurocurrency market where its relevant eurocurrency andforeign currency and exchange operations are then being conducted for delivery on the first day of such Interest Period for the number of days comprisedtherein.

"Eurocurrency Reserve Requirements" means, for any day as applied to a Eurocurrency Loan borrowed in the United States of America, theaggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including basic,supplemental, marginal and emergency reserves) under any regulations of the Board or other Governmental Authority having jurisdiction with respect theretodealing with reserve requirements prescribed for Eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in Regulation D of the Board)maintained by a member bank of the Federal Reserve System.

"Event of Default" has the meaning assigned to such term in Article VII.

"Excluded Taxes" means, with respect to the Administrative Agent, any Lender or any other recipient of any payment to be made by or onaccount of any obligation of the Borrower hereunder,

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(a) income or franchise taxes imposed on (or measured by) its net income by the United States of America, or by the jurisdiction under the laws of which suchrecipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branchprofits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which the Borrower is located and (c) in the caseof a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 2.18(b)), any withholding tax that is in effect and would beimposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office)or is attributable to such Foreign Lender's failure to comply with Section 2.16(e), except to the extent that such Foreign Lender (or its assignor, if any) wasentitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrower with respect to such withholdingtax pursuant to Section 2.16(a).

"Existing Credit Agreement" means that certain 5-Year Revolving Credit Facility, dated as of June 15, 2007 by and among MF Global FinanceUSA INC. as the borrower, the Parent, MF Global Finance Europe Limited, the several banks and other financial institutions parties thereto as lenders,Citibank, N.A. and Bank of America, N.A., as syndication agents and JPMorgan Chase Bank, N.A., as administrative agent.

"Federal Funds Effective Rate" means, for any period commencing on a day that is a Business Day to the next Business Day, the weightedaverage (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal ReserveSystem arranged by Federal funds brokers, as published on such next Business Day by the Federal Reserve Bank of New York, or, if such rate is not sopublished, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received by theAdministrative Agent from three Federal funds brokers of recognized standing selected by it.

"Fed Funds", when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, arebearing interest at a rate determined by reference to the Fed Funds Rate

"Fed Funds Loans" means Loans the rate of interest applicable to which is based on the Fed Funds Rate.

"Fed Funds Rate" means, for any day for any Borrowing, a rate per annum equal to the greater of (a) the rate of interest per annum which is theaverage of the rates on the offered side of the Federal funds market quoted by three interbank Federal funds brokers at the approximate time of suchBorrowing (for the first day of such Borrowing and until the next Business Day) and 12:00 noon (New York City time) (for each subsequent Business Daywhile such Borrowing is outstanding and until the next Business Day), selected by the Administrative Agent, for Federal Funds and (b) the Eurocurrency Rateon such day (or, if such day is not a Business Day, the immediately preceding Business Day) for a one-month Interest Period commencing two Business Daysthereafter. For the avoidance of doubt, the Federal Funds Rate shall be determined on each Business Day on which a Borrowing of Loans is requested oroutstanding, as provided herein.

"Financial Officer" means the chief financial officer, principal accounting officer, treasurer or controller of the Borrower or the Parent, as thecase may be.

"Firm Deficiency" has the meaning assigned to such term in Section 2.10

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"Firm Loan" means, at any date, any Loan which has been designated pursuant to Section 2.03 or Section 2.05(b) (or redesignated pursuant toSection 6 of the Security Agreement), as the case may be, by the Borrower as a "Firm Loan".

"Firm Pledged Eligible Asset" means any Eligible Asset designated as a "Firm Pledged Eligible Asset" in the relevant Pledged Eligible AssetsNotice that has been pledged to the Administrative Agent for the benefit of the Lenders to secure the obligations of the Borrower in respect of the Loanspursuant to the terms of the Security Agreement.

"Firm Revolving Credit Exposure" means, with respect to any Lender at any time, the aggregate outstanding principal amount of such Lender'sRevolving Loans and Swingline Exposure at such time designated as Firm Loans.

"FOCUS Report" the Financial and Operational Combined Uniform Single Report on Form X-17A-5. A "Part II FOCUS Report" is a report filedon Form X-17A-5 Part II.

"Foreign Lender" means, as to the Borrower, any Lender that is organized under the laws of a jurisdiction other than that in which the Borroweris located. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a singlejurisdiction.

"GAAP" means generally accepted accounting principles in the United States of America.

"Governmental Authority" means the government of the United States of America, any other nation or any political subdivision thereof, whetherstate or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing,regulatory or administrative powers or functions of or pertaining to government.

"Guarantee" of or by any Person (the "guarantor") means any obligation, contingent or otherwise, of the guarantor guaranteeing or having theeconomic effect of guaranteeing any Indebtedness of any other Person (the "primary obligor") in any manner, whether directly or indirectly, and including anyobligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or topurchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services forthe purpose of assuring the owner of such Indebtedness of the payment thereof, (c) to maintain working capital, equity capital or any other financial statementcondition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or (d) as an account party in respect of any letter ofcredit or letter of guaranty issued to support such Indebtedness; provided, that the term Guarantee shall not include endorsements for collection or deposit inthe ordinary course of business.

"Guaranty" means the Guaranty to be executed and delivered by the Parent and MF USA as of the Effective Date, substantially in the form ofExhibit A.

"Hazardous Materials" means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants,including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes andall other substances or wastes of any nature regulated pursuant to any Environmental Law.

"Indebtedness" of any Person means, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of suchPerson evidenced by bonds, debentures, notes or

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similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditionalsale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase priceof property or services (excluding current accounts payable and forward, futures and similar transactions incurred or entered into in the ordinary course ofbusiness), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be securedby) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by suchPerson of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise, of such Person as an accountparty in respect of letters of credit and letters of guaranty and (j) all obligations, contingent or otherwise, of such Person in respect of bankers' acceptances, butin any event excluding from clauses (a) through (j) obligations of any Person to its customers incurred in the ordinary course of business. The Indebtedness ofany Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person isliable therefor as a result of such Person's ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtednessprovide that such Person is not liable therefor.

"Indemnified Taxes" means Taxes other than Excluded Taxes.

"Information Memorandum" means the Confidential Information Memorandum dated [ ], 2011 relating to the Borrower and this Agreement.

"Interest Election Request" means a request by the Borrower to convert or continue a Borrowing in accordance with Section 2.06.

"Interest Payment Date" means (a) with respect to any ABR Loan, any such date upon which an interest payment is demanded by the Lenders,(b) with respect to any Eurocurrency Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of aEurocurrency Borrowing with an Interest Period of more than three months' duration, each day prior to the last day of such Interest Period that occurs atintervals of three months' duration after the first day of such Interest Period, (c) with respect to any Fed Funds Rate Loan, the last day of each calendar monthand (d) with respect to any Swingline Loan (without regard to clause (a) or (c)), the day that such Loan is repaid or required to be repaid.

"Interest Period" means with respect to any Eurocurrency Borrowing, the period commencing on the date of such Borrowing and ending on theseventh day thereafter or the numerically corresponding day in the calendar month that is one, two, three or six months thereafter, as the Borrower may elect;provided, that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding BusinessDay unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next precedingBusiness Day and (ii) any Interest Period (other than a seven day Interest Period) pertaining to a Eurocurrency Borrowing that commences on the lastBusiness Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shallend on the last Business Day of the last calendar month of such Interest Period. For purposes hereof, the date of a Borrowing initially shall be the date onwhich such Borrowing is made and, in the case of a Borrowing, thereafter shall be the effective date of the most recent conversion or continuation of suchBorrowing.

"Lenders" means the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto pursuant to an Assignment andAssumption, other than any such Person that

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ceases to be a party hereto pursuant to an Assignment and Assumption. Unless the context otherwise requires, the term "Lenders" includes the SwinglineLenders.

"Lien" means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financinglease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call orsimilar right of a third party with respect to such securities.

"Loan Documents" means this Agreement, the Guaranty and the Security Agreement and any amendment, waiver, supplement or othermodification hereof or thereof.

"Loan Party" means each of the parent, the Borrower and MF USA.

"Loan Value" means, as to any Pledged Eligible Asset at any time, the product of (i) the Market Value of such Pledged Eligible Asset as mostrecently determined by the Administrative Agent and (ii) the relevant advance rate set forth in Schedule 1.01 and subject to the limitations provided therein.

"Loans" means the loans made by the Lenders to the Borrower pursuant to this Agreement.

"Market Value" means as to any Pledged Eligible Asset, the market value determined by the Administrative Agent in its usual and customarymanner for loans to broker-dealers based on pricing information with respect to such Pledged Eligible Asset reasonably available to the Administrative Agentfrom one or more pricing services selected by the Administrative Agent in its reasonable discretion.

"Material Adverse Effect" means a material adverse effect on (a) the business, operations, property or condition (financial or otherwise) of theParent and the Subsidiaries taken as a whole, (b) the ability of the Parent, the Borrower or MF USA to perform any of its obligations under the LoanDocuments or (c) the material rights of or material benefits available to the Administrative Agent and the Lenders under the Loan Documents.

"Material Indebtedness" means Indebtedness (other than the Loans) of a type referred to in clause (a), (b), (c) or (h) of the definition of"Indebtedness" or of a type referred to in clause (i) or (j) and owing to a bank, or Guarantees of any such Indebtedness, or obligations in respect of one ormore Swap Agreements or Repo Transactions, of any one or more of the Parent and its Subsidiaries in an aggregate principal amount exceeding $50,000,000.For purposes of determining Material Indebtedness, (i) the "principal amount" of the obligations of the Parent or any Subsidiary in respect of any SwapAgreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Borrower or such Subsidiary would berequired to pay if such Swap Agreement were terminated at such time and (ii) the "principal amount" of the obligations of the Parent or any Subsidiary inrespect of any Repo Transaction at any time shall be the net deficit amount of such Repo Transaction, calculated as the difference between the amountpayable by the Parent or any Subsidiary pursuant to such Repo Transaction and the present market value of the securities or other assets it is entitled to receiveupon making such payment (or, to the extent such Repo Transaction is subject to any master netting agreement or arrangement with the counterparty theretoor a clearinghouse, the net deficit of all transactions then subject to settlement with such counterparty or clearinghouse). Indebtedness without regard toamount that is owed by the Parent to any Subsidiary, or by any Subsidiary to the Parent or any other Subsidiary, shall not constitute "Material Indebtedness"under this Agreement. For the avoidance of doubt, the Existing Credit Agreement shall be deemed "Material Indebtedness".

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"Maturity Date" means the date which is 364 days after the Effective Date.

"MF USA" has the meaning assigned to such term in the preamble hereto.

"Multiemployer Plan" means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

"Net Cash Proceeds" means, in connection with any issuance or sale of Equity Interests or any incurrence of Indebtedness (including any "hybridsecurities"), the gross cash proceeds received from such issuance or incurrence, net of payments or accruals for attorneys' fees, investment banking fees,accountants' fees, underwriting discounts and commissions and other customary fees and expenses actually incurred in connection therewith.

"New York Office" means the New York office of the Administrative Agent specified in Section 9.01(a), as the same may be changed asprovided in Section 9.01(c).

"Other Taxes" means any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar leviesarising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement.

"Parent" has the meaning assigned to such term in the preamble hereto.

"Participant" has the meaning set forth in Section 9.04.

"Patriot Act" has the meaning assigned to such term in Section 9.13.

"PBGC" means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similarfunctions.

"Pension Act" means the Pension Protection Act of 2006, as amended.

"Permitted Encumbrances" means:

(a) Liens imposed by law for taxes that are not yet due or are being contested in compliance with Section 5.04;

(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's and other like Liens imposed by law, arising in the ordinary course ofbusiness and securing obligations that are not overdue by more than 60 days or are being contested in compliance with Section 5.04;

(c) pledges and deposits made in the ordinary course of business in compliance with workers' compensation, unemployment insurance and othersocial security laws or regulations;

(d) deposits to secure the performance of bids, trade contracts, leases, statutory obligations, government contracts, surety and appeal bonds,performance bonds and other obligations of a like nature, in each case in the ordinary course of business;

(e) judgment liens in respect of judgments that do not constitute an Event of Default under clause (k) of Article VII; and

(f) easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course ofbusiness that do not secure any

11

monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of theParent or any Significant Subsidiary;

(g) licenses (with respect to any intellectual property and other property), leases or subleases granted to third parties by the Parent and itsSubsidiaries in the ordinary course of business and not interfering in any material respect with the ordinary conduct of the business of the Parent or anyof its Subsidiaries;

(h) any (a) interest or title of a lessor or sublessor under any lease of property to the Parent or any of its Subsidiaries, (b) Lien or restriction thatthe interest or title of such lessor or sublessor referred to in the preceding clause (a) may be subject to, or (c) subordination of the interest of the lesseeor sublessee under such lease to any Lien or restriction referred to in the preceding clause (b), so long as the holder of such Lien or restriction agrees torecognize the rights of such lessee or sublessee under such lease;

(i) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with theimportation of goods so long as such Liens only cover the related goods;

(j) any zoning or similar law or right reserved to or vested in any governmental office or agency to control or regulate the use of any real propertyowned or leased by the Parent or any of its Significant Subsidiaries; and

(k) Reciprocal easement or similar agreements entered into in the ordinary course of business of the Parent and its Subsidiaries;

provided that the term "Permitted Encumbrances" shall not include any Lien securing Indebtedness.

"Person" means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, GovernmentalAuthority or other entity.

"Plan" means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412of the Code or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would underSection 4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.

"Pledged Eligible Asset" means any Eligible Asset that has been pledged to the Administrative Agent for the benefit of the Lenders to secureobligations of the Borrower in respect of the Loans pursuant to the terms of the Security Agreement and designated as either a Customer Pledged EligibleAsset or a Firm Pledged Eligible Asset.

"Pledged Eligible Assets Notice" has the meaning set forth in Section 2.03(b).

"Prime Rate" means the rate of interest per annum publicly announced from time to time by JPMorgan Chase Bank, N.A. as its prime rate ineffect at its principal office in New York City; each change in the Prime Rate shall be effective from and including the date such change is publicly announcedas being effective.

"Register" has the meaning set forth in Section 9.04.

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"Related Parties" means, with respect to any specified Person, such Person's Affiliates and the respective directors, officers, employees, agentsand advisors of such Person and such Person's Affiliates.

"Repo Transaction" means any of the following: repurchase agreements, reverse repurchase agreements, sell buy backs and buy sell backsagreements, securities lending and borrowing agreements and any other agreement or transaction similar to those referred to above in this definition.

"Required Lenders" means, at any time, Lenders having Revolving Credit Exposures and unused Commitments representing more than 50% ofthe sum of the total Revolving Credit Exposures and unused Commitments at such time, subject to Section 2.19.

"Revolving Credit Exposures" means, with respect to any Lender at any time, the sum of such Lender's Customer Revolving Credit Exposuresand the Firm Revolving Credit Exposures.

"Revolving Loan" has the meaning assigned to such term in Section 2.01.

"SEC" means the Securities and Exchange Commission.

"Security Agreement" means the Security Agreement dated as of the date hereof among the Borrower and the Administrative Agent, for thebenefit of the Lenders, substantially in the form of Exhibit B, as the same may be amended, supplemented or otherwise modified from time to time.

"Significant Subsidiary" means, at any time, the Borrower or any other subsidiary of the Parent satisfying the requirements of Rule 1-02(w) ofRegulation S-X as adopted by the Securities and Exchange Commission, as the same may be amended or supplemented from time to time.

"subsidiary" means, with respect to any Person (the "parent") at any date, any corporation, limited liability company, partnership, association orother entity the accounts of which would be consolidated with those of the parent in the parent's consolidated financial statements if such financial statementswere prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity(a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case ofa partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as of such date, otherwiseControlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.

"Subsidiary" means any subsidiary of the Parent.

"Supermajority Lenders" means, at any time, Lenders having Revolving Credit Exposures and unused Commitments representing more than 75%of the sum of the total Revolving Credit Exposures and unused Commitments at such time, subject to Section 2.19.

"Swap Agreement" means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreementinvolving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricingindices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that nophantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultantsof the Parent or its Subsidiaries shall be a Swap Agreement.

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"Swingline Commitment" means, with respect to each Swingline Lender, the commitment of such Swingline Lender to make Swingline Loans asset forth on Schedule 2.04, as such commitments may be assigned with the consent of the Borrower and the Administrative Agent (each such consent not tobe unreasonably withheld), as such commitments may be affected by the resignation of, or the appointment of another Lender as, a Swingline Lender (in eachcase with the consent of the Borrower and the Administrative Agent, each such consent not to be unreasonably withheld).

"Swingline Exposure" means, at any time, the aggregate principal amount of all Swingline Loans outstanding at such time. The SwinglineExposure of any Lender at any time shall be its Applicable Percentage of the total Swingline Exposure at such time.

"Swingline Lender" means each of the Lenders specified on Schedule 2.04, in its capacity as a lender of Swingline Loans hereunder, subject tochanges to such Lenders as contemplated in the definition of "Swingline Commitment" in this Section 1.01.

"Swingline Loan" means a Loan made pursuant to Section 2.05.

"Syndication Agent" has the meaning assigned to such term in the preamble hereto.

"Taxes" means any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any GovernmentalAuthority.

"Transactions" means the execution, delivery and performance by the Parent, the Borrower of this Agreement and the other Loan Documents, theborrowing of Loans, and the use of the proceeds thereof.

"Type", when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising suchBorrowing, is determined by reference to the Eurocurrency Rate, the Fed Funds Rate or the Alternate Base Rate.

"Withdrawal Liability" means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, assuch terms are defined in Part I of Subtitle E of Title IV of ERISA.

SECTION 1.02. Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Class (e.g.,a "Revolving Loan") or by Type (e.g., a "Eurocurrency Loan") or by Class and Type (e.g., a "Eurocurrency Revolving Loan"). Borrowings also may beclassified and referred to by Class (e.g., a "Revolving Borrowing") or by Type (e.g., a "Eurocurrency Borrowing") or by Class and Type (e.g., a"Eurocurrency Revolving Borrowing").

SECTION 1.03. Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words "include", "includes" and"including" shall be deemed to be followed by the phrase "without limitation". The word "will" shall be construed to have the same meaning and effect as theword "shall". Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall beconstrued as referring to such agreement, instrument or other document as from time to time amended, amended and restated, supplemented or otherwisemodified (subject to any restrictions on such amendments, supplements or modifications set forth herein) and any definition of or reference to any law, statute,regulation, rule or other legislative action shall mean such law, statute, regulation, rule or other legislative action as amended, supplemented or otherwisemodified from time to time, (b) any reference

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herein to any Person shall be construed to include such Person's successors and assigns, (c) the words "herein", "hereof" and "hereunder", and words ofsimilar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles,Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (e) the words"asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties,including cash, securities, accounts and contract rights.

SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall beconstrued in accordance with GAAP, as in effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the Borrowerrequests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof onthe operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereoffor such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shallbe interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have beenwithdrawn or such provision amended in accordance herewith. All terms of an accounting or financial nature shall be construed, and all computations ofamounts and ratios shall be made without giving effect to any treatment of indebtedness in respect of convertible debt instruments under Financial AccountingStandards Board Staff Position APB 14-1 to value any such indebtedness in a reduced or bifurcated manner as described therein, and such indebtedness shallat all times be valued at the full stated principal amount thereof. Notwithstanding any other provision contained herein, all computations of amounts and ratiosreferred to in this Agreement shall be made without giving effect to any election under FASB ASC Topic 825 "Financial Instruments" (or any other financialaccounting standard having a similar result or effect) to value any Indebtedness or other liabilities of the Parent or any Subsidiary at "fair value" as definedtherein.

ARTICLE II

The Credits

SECTION 2.01. Commitments. Subject to the terms and conditions set forth herein, each Lender agrees to make revolving credit loans("Revolving Loans") denominated in Dollars, to the Borrower from time to time during the Availability Period in an aggregate principal amount that will notresult in (a) such Lender's Revolving Credit Exposures exceeding such Lender's Commitment, (b) the total Revolving Credit Exposures exceeding theaggregate Commitments, (c) in the case of a Customer Loan, the total Customer Revolving Credit Exposures exceeding the aggregate Loan Value of theCustomer Pledged Eligible Assets or (d) in the case of a Firm Loan, the total Firm Revolving Credit Exposures exceeding the aggregate Loan Value of theFirm Pledged Eligible Assets. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay andreborrow the Revolving Loans. Each Lender may, at its option, make any Loan available to the Borrower by causing any foreign or domestic branch orAffiliate of such Lender to make such Loan; provided that, any exercise of such option shall not affect the obligation of such Borrower to repay such Loan inaccordance with the terms of this Agreement.

SECTION 2.02. Loans and Borrowings. (a) Each Revolving Loan shall, as contemplated by the Security Agreement, be either a Customer Loanor a Firm Loan (and each such Revolving Loan (or any portion thereof) may be redesignated from time to time in accordance with, and subject to thelimitations contained in Section 6 of the Security Agreement as a Customer Loan or Firm Loan) and shall be made as part of a Revolving Borrowing made bythe Lenders ratably in accordance

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with their respective Commitments. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligationshereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender's failure to make Loans asrequired.

(b) Subject to Section 2.12, each Revolving Borrowing shall be comprised entirely of Fed Funds Loans or Eurocurrency Loans as the Borrowermay request in accordance herewith. Subject to Section 2.12, each Swingline Loan shall be a Fed Funds Loan. Each Lender at its option may make anyEurocurrency Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shallnot affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.

(c) Each Revolving Borrowing shall be in an aggregate amount that is an integral multiple of $1,000,000 and not less than $5,000,000.

(d) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, anyEurocurrency Borrowing if the Interest Period requested with respect thereto would end after the Maturity Date.

SECTION 2.03. Requests for Revolving Borrowings. (a) To request a Revolving Borrowing, the Borrower shall notify the Administrative Agentof such request by telephone (x) in the case of a Eurocurrency Borrowing not later than 11:00 a.m., New York City time, three Business Days before the dateof the proposed Revolving Borrowing or (y) in the case of a Fed Funds Borrowing, not later than 2:00 p.m., New York City time, on the date of the proposedRevolving Borrowing. Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or facsimile (or in anyother manner approved pursuant to Section 9.01(b)) to the Administrative Agent of a written Borrowing Request in a form approved by the AdministrativeAgent and signed by the Borrower. Each such telephonic and written Borrowing Request shall specify the following information in compliance withSection 2.02:

(i) whether such Borrowing is designated as a Customer Loan or a Firm Loan;

(ii) the aggregate amount of the requested Borrowing;

(iii) the date of such Borrowing, which shall be a Business Day;

(iv) whether such Borrowing is to be a Fed Funds Borrowing or a Eurocurrency Borrowing;

(v) in the case of a Eurocurrency Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by thedefinition of the term "Interest Period" and

(vi) the directions for disbursement of the proceeds of such Borrowing, which shall comply with the requirements of Section 2.04.

If no election as to the Type of Revolving Borrowing is specified, then the requested Revolving Borrowing shall be a Fed Funds Borrowing. If no InterestPeriod is specified with respect to any requested Eurocurrency Borrowing, then the Borrower shall be deemed to have selected an Interest Period of onemonth's duration. Promptly following receipt of a Borrowing Request in accordance with this

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Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender's Loan to be made as part of the requestedBorrowing.

(b) In connection with each Borrowing, and in any event prior to the time by which it expects the proceeds of such Borrowing to be madeavailable to it, the Borrower shall also deliver a notice to the Administrative Agent in substantially the form of Exhibit E (a "Pledged Eligible Assets Notice")detailing the Eligible Assets, if any, that will be pledged under the Security Agreement in connection with such Borrowing, whether such Eligible Assets aredesignated as Customer Pledged Eligible Assets or Firm Pledged Eligible Assets and the respective Loan Values thereof.

SECTION 2.04. Funding of Revolving Borrowings. (a) Each Lender shall make each Revolving Loan to be made by it hereunder on the proposeddate thereof by wire transfer of immediately available funds by 12:00 noon, New York City time (or 3:00 p.m., New York City time, in the case of aBorrowing of Fed Fund Loans following same day notice therefor), to the account of the Administrative Agent most recently designated by it for such purposeby notice to the Lenders. The Administrative Agent will make such Loans available to the Borrower, or if less such portion thereof as may be borrowed by theBorrower within the requirements of Sections 2.01(c) and (d) (as determined by reference to the Customer Pledged Eligible Assets and Firm Pledged EligibleAssets as to which the Administrative Agent already has a perfected security interest pursuant to the Security Agreement), by promptly transferring theamounts so received, in like funds, in accordance with the direction in the relevant Borrowing Request. The Administrative Agent shall notify the Borrower ifany portion of such amounts is not so transferred and shall hold such portion pending compliance with the requirements of Sections 2.01(c) and (d) or, if theBorrower so requests, return such portion ratably to the Lenders. Any such portion not returned to the Lenders by [ ] p.m., New York City time, shall bedeemed to be an outstanding Loan until the next Business Day.

(b) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender willnot make available to the Administrative Agent such Lender's share of such Borrowing, the Administrative Agent may assume that such Lender has madesuch share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the Borrowera corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then theapplicable Lender and the Borrower, as the case may be, severally agree to pay to the Administrative Agent forthwith on demand such corresponding amountwith interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to theAdministrative Agent, at (i) in the case of such Lender, a rate determined by the Administrative Agent in accordance with banking industry rules on interbankcompensation (or, if greater, the Fed Funds Effective Rate) or (ii) in the case of the Borrower, the interest rate applicable to ABR Loans. If such Lender payssuch amount to the Administrative Agent, then such amount shall constitute such Lender's Revolving Loan included in such Borrowing.

SECTION 2.05. Swingline Loans. (a) Subject to the terms and conditions set forth herein, each Swingline Lender agrees to make SwinglineLoans denominated in Dollars to the Borrower from time to time during the Availability Period, which shall, as contemplated by the Security Agreement,consist of either a Customer Loan or a Firm Loan (and each such Swingline Loan (or any portion thereof) may be redesignated from time to time inaccordance with, and subject to the limitations contained in Section 6 of the Security Agreement as a Customer Loan or Firm Loan), in an aggregate principalamount at any time outstanding that will not result in (i) the aggregate principal amount of the Swingline Loans of any Swingline Lender exceeding itsSwingline Commitment (except to the extent such Swingline Lender otherwise agrees at the time of any such Swingline Loan), (ii) the sum of the totalRevolving Credit Exposures exceeding the total Commitments, (iii) the sum of the total Customer Revolving Credit

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Exposures exceeding the aggregate Loan Value of the Customer Pledged Eligible Assets or (iv) the sum of the total Firm Revolving Credit Exposuresexceeding the aggregate Loan Value of the Firm Pledged Eligible Assets; provided that no Swingline Lender shall be required to make a Swingline Loan torefinance an outstanding Swingline Loan. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow,prepay and reborrow Swingline Loans. Swingline Loans shall not be required to be borrowed from the Swingline Lenders on a pro rata basis.

(b) To request a Swingline Borrowing, the Borrower shall (i) notify the Administrative Agent of such request by telephone (confirmed byfacsimile (or in any other manner approved pursuant to Section 9.01(b))), not later than 4:00 p.m., New York City time, on the day of the proposed SwinglineBorrowing, which notice shall be irrevocable and shall specify the requested date (which shall be a Business Day) and amount of the requested SwinglineLoan and whether such Swingline Loan will be designated a Customer Loan or a Firm Loan and (ii) in connection with such request, and in any event no laterthan [one hour] prior to the time by which it expects the proceeds of such Swingline Borrowing to be made available to it, the Borrower shall also deliver aPledged Eligible Assets Notice to the Administrative Agent detailing the Eligible Assets, if any, that will be pledged under the Security Agreement inconnection with such Swingline Borrowing, whether such Eligible Assets are designated as Customer Pledged Eligible Assets or Firm Pledged Eligible Assetsand the respective Loan Values thereof. The Administrative Agent will promptly advise the relevant Swingline Lender of any such notice received from theBorrower and shall calculate the aggregate Loan Value of the Pledged Eligible Assets, including those referred to in clause (ii), and promptly notify theBorrower and each applicable Swingline Lender if the requirements of Sections 2.01(c) and (d) are not satisfied. Such Swingline Lender shall make suchSwingline Loan available to the Borrower, or less such portion thereof as may be borrowed by the Borrower within the requirements of Sections 2.01(c) and(d) (as determined by reference to the Pledged Eligible Assets as to which the Administrative Agent already has a perfected security interest pursuant to theSecurity Agreement), by promptly transferring the amounts so received, in like funds, by means of a credit by 6:00 p.m., New York City time, on therequested date of such Swingline Loan to the general deposit account of the Borrower in New York with the Swingline Lender or to an account maintainedwith the Administrative Agent or such Swingline Lender and designated by the Borrower in the request for such Swingline Loan. The Swingline Lender shallnotify the Borrower if any portion of such amounts is not so transferred and shall hold such portion pending compliance with the requirements of Sections2.01(c) and (d) or, if applicable and the Borrower so requests, return such portion ratably to the Swingline Lenders. Any such portion not returned to theLenders by [ ] p.m., New York City time, shall be deemed to be an outstanding Swingline Loan until the next Business Day.

(c) A Swingline Loan shall be a Fed Funds Loan.

(d) A Swingline Lender may by written notice given to the Administrative Agent not later than 10:00 a.m., New York City time, on any BusinessDay require the Lenders to acquire participations on such Business Day in all or a portion of its Swingline Loans outstanding. Such notice shall specify theaggregate amount of Swingline Loans in which Lenders will participate. Promptly upon receipt of such notice, the Administrative Agent will give noticethereof to each Lender, specifying in such notice such Lender's Applicable Percentage of such Swingline Loan. Each Lender hereby absolutely andunconditionally agrees, upon receipt of notice as provided above, to pay to the Administrative Agent, for the account of such Swingline Lender, such Lender'sApplicable Percentage of such Swingline Loan or Loans. Each Lender acknowledges and agrees that its obligation to acquire participations in SwinglineLoans pursuant to this paragraph is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence andcontinuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement,withholding or reduction whatsoever. Each Lender shall comply with its obligation under this paragraph by wire transfer of immediately available funds, inthe same manner as provided in

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Section 2.04 with respect to Revolving Loans made by such Lender (and Section 2.04 shall apply, mutatis mutandis, to the payment obligations of the Lenderswith respect thereto), and the Administrative Agent shall promptly pay to the Swingline Lender the amounts so received by it from the Lenders. TheAdministrative Agent shall notify the Borrower of any participations in any Swingline Loan acquired pursuant to this paragraph, and thereafter payments inrespect of such Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender. Any amounts received by any Swingline Lenderfrom the Borrower (or other party on behalf of the Borrower) in respect of a Swingline Loan after receipt by such Swingline Lender of the proceeds of a saleof participations therein shall be promptly remitted to the Administrative Agent; any such amounts received by the Administrative Agent shall be promptlyremitted by the Administrative Agent to the Lenders that shall have made their payments pursuant to this paragraph and to such Swingline Lender, as theirinterests may appear; provided that any such payment so remitted shall be repaid to such Swingline Lender or to the Administrative Agent, as applicable, ifand to the extent such payment is required to be refunded to the Borrower for any reason. The purchase of participations in a Swingline Loan pursuant to thisparagraph shall not relieve the Borrower of any default in the payment thereof.

SECTION 2.06. Interest Elections. (a) Each Revolving Borrowing initially shall be of the Type specified in the applicable Borrowing Requestand, in the case of a Eurocurrency Revolving Borrowing, shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, theBorrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurocurrency Revolving Borrowing,may elect Interest Periods therefor, all as provided in this Section. The Borrower may elect different options with respect to different portions of the affectedBorrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loanscomprising each such portion shall be considered a separate Borrowing. This Section shall not apply to Swingline Borrowings, which may not be converted.

(b) To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by the timethat a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Revolving Borrowing of the Type resulting from suchelection to be made on the effective date of such election. Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptlyby hand delivery or facsimile (or in any other manner approved pursuant to Section 9.01(b)) to the Administrative Agent of a written Interest Election Requestin a form approved by the Administrative Agent and signed by the Borrower.

(c) Each telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.02:

(i) the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portionsthereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses(iii) and (iv) below shall be specified for each resulting Borrowing);

(ii) the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

(iii) whether the resulting Borrowing is to be a Fed Funds Borrowing or a Eurocurrency Borrowing; and

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(iv) if the resulting Borrowing is a Eurocurrency Borrowing, the Interest Period to be applicable thereto after giving effect to such election,which shall be a period contemplated by the definition of the term "Interest Period".

If any such Interest Election Request requests a Eurocurrency Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to haveselected an Interest Period of one month's duration.

(d) Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and ofsuch Lender's portion of each resulting Borrowing.

(e) If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurocurrency Revolving Borrowing prior to the end of theInterest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall beconverted to a Fed Funds Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and theAdministrative Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstandingRevolving Borrowing may be converted to or continued as a Eurocurrency Revolving Borrowing or a Fed Funds Borrowing and (ii) unless repaid, eachBorrowing shall be converted to an ABR Borrowing, in the case of a Eurocurrency Borrowing at the end of the Interest Period applicable thereto, and in thecase of a Fed Funds Borrowing, on the next Business Day.

SECTION 2.07. Termination and Reduction of Commitments. (a) Unless previously terminated, the Commitments shall terminate on theMaturity Date.

(b) Subject to Section 2.07(c), the Borrower may at any time terminate, or from time to time reduce, the Commitments; provided that (i) eachreduction of the Commitments shall be in an amount that is an integral multiple of $5,000,000 and not less than $25,000,000 and (ii) the Borrower shall notterminate or reduce the Commitments if, after giving effect to any concurrent prepayment of any Loans in accordance with Section 2.09, the sum of theRevolving Credit Exposures hereunder is greater than the Commitments.

(c) The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Commitments under paragraph (b) of thisSection at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof.Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrowerpursuant to this Section shall be irrevocable. Any termination or reduction of the Commitments shall be permanent. Each reduction of the Commitments shallbe made ratably among the Lenders in accordance with their respective Commitments.

SECTION 2.08. Repayment of Loans; Evidence of Debt. (a) The Borrower hereby unconditionally promises to pay (i) to the AdministrativeAgent for the account of each Lender the then unpaid principal amount of each Revolving Loan made to the Borrower on the Maturity Date and (ii) to eachSwingline Lender the then unpaid principal amount of each Swingline Loan on the earlier of the Maturity Date and the first date after such Swingline Loanmade by such Swingline Lender is made that is the 15th or last day of a calendar month and is at least five Business Days after such Swingline Loan is made;provided that on each date that a Revolving Borrowing is made, the Borrower shall repay all Swingline Loans then outstanding for more than three BusinessDays.

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(b) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to suchLender resulting from each Loan made by such Lender to the Borrower, including the amounts of principal and interest payable and paid to such Lender fromtime to time hereunder.

(c) The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Class and Typethereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrowerto each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender'sshare thereof.

(d) The entries made in the accounts maintained pursuant to paragraph (b) or (c) of this Section shall be prima facie evidence of the existence andamounts of the obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any errortherein shall not in any manner affect the obligation of the Borrower to repay the Loans made to it in accordance with the terms of this Agreement.

(e) Any Lender may request that Loans made by it be evidenced by promissory notes. In such event, the Administrative Agent shall prepare andthe Borrower shall execute and deliver to such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender, to such Lenderand its registered assigns) and in a form approved by the Administrative Agent. Thereafter, the Loans evidenced by such promissory note and interest thereonshall at all times (including after assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form payable to the order ofthe payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).

SECTION 2.09. Optional Prepayment of Loans. (a) The Borrower shall have the right at any time and from time to time to prepay any Borrowingin whole or in part, subject to prior notice in accordance with paragraph (b) of this Section.

(b) The Borrower shall notify the Administrative Agent (and, in the case of prepayment of a Swingline Loan, the relevant Swingline Lender) bytelephone (confirmed by facsimile (or in any other manner approved pursuant to Section 9.01(b))) of any prepayment hereunder (i) in the case of prepaymentof a Eurocurrency Borrowing, not later than 11:00 a.m., New York City time, three Business Days before the date of prepayment or (ii) in the case ofprepayment of a Fed Funds Borrowing or an ABR Borrowing, not later than 11:00 a.m., New York City time, on the date of prepayment. Each such noticeshall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid, which shall be in aminimum amount of $5,000,000 and in increments of $1,000,000 in excess thereof; provided that, if a notice of prepayment is given in connection with aconditional notice of termination of the Commitments as contemplated by Section 2.07, then such notice of prepayment may be revoked if such notice oftermination is revoked in accordance with Section 2.07. Promptly following receipt of any such notice relating to a Revolving Borrowing, the AdministrativeAgent shall advise the relevant Lenders of the contents thereof. Each partial prepayment of any Revolving Borrowing shall be in an amount that would bepermitted in the case of an advance of a Revolving Borrowing of the same Type and in the same currency as provided in Section 2.02. Each prepayment of aRevolving Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to theextent required by Section 2.11.

SECTION 2.10. Daily Calculation of Loan Value; Mandatory Prepayments. (a) At or prior to 11:00 a.m., New York City time, on each BusinessDay on which any Loans shall remain outstanding, the Administrative Agent shall calculate (i) the aggregate Loan Value of the Customer

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Pledged Eligible Assets and (ii) the aggregate Loan Value of the Firm Pledged Eligible Assets (which calculations shall be made as of the close of business onthe previous Business Day) and shall promptly provide such calculation to the Borrower. In the event that the Administrative Agent determines that (i) theaggregate principal amount of the Customer Loans outstanding on such Business Day exceeds the aggregate Loan Value of the Customer Pledged EligibleAssets (a "Customer Deficiency") or (ii) the aggregate principal amount of the Firm Loans outstanding on such Business Day exceeds the aggregate LoanValue of the Firm Pledged Eligible Assets (a "Firm Deficiency", and either a Firm Deficiency or a Customer Deficiency, a "Deficiency"), the AdministrativeAgent shall promptly notify the Borrower of such Deficiency in writing (any such notice, a "Deficiency Notice"). In the event of a Deficiency, unless theBorrower has pledged additional Customer Pledged Eligible Assets or Firm Pledged Eligible Assets, as applicable, with an aggregate Loan Value at leastequal to such Deficiency, the Borrower shall prepay the Customer Loans or the Firm Loans, as applicable, in an amount at least equal to such Deficiencywithin one Business Day of receipt of a Deficiency Notice.

(b) Any Pledged Eligible Asset shall be released from the pledge thereof under the Security Agreement promptly upon the request of theBorrower; provided that (i) no Event of Default has occurred and is continuing at such time and (ii) a Deficiency would not be in existence after giving effectto such release.

SECTION 2.11. Fees. (a) The Borrower agrees to pay to the Administrative Agent for the account of each Lender a commitment fee, which shallaccrue at 0.20% of the daily unused amount of the Commitment (excluding the Swingline Exposure) of such Lender during the period from and including thedate hereof to but excluding the date on which such Commitment terminates.

(b) Accrued commitment fees shall be payable in arrears on the last day of March, June, September and December, commencing September 30,2011 and on the date on which the Commitments terminate. All commitment fees shall be computed on the basis of a year of 360 days and shall be payablefor the actual number of days elapsed (including the first day but excluding the last day).

(c) The Borrower agrees to pay to the Administrative Agent, for its own account, fees payable in the amounts and at the times separately agreedupon between the Borrower and the Administrative Agent.

(d) All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution, in thecase of commitment fees, to the Lenders. Fees paid shall not be refundable under any circumstances.

SECTION 2.12. Interest. (a) The Loans comprising each Eurocurrency Revolving Borrowing shall bear interest at the Eurocurrency Rate for theInterest Period in effect for such Borrowing plus the Applicable Margin.

(b) The Loans comprising each Fed Funds Borrowing shall bear interest at the Fed Funds Rate in effect for such Borrowing plus the ApplicableMargin.

(c) The Loans comprising each Borrowing which has been converted to an ABR Loan pursuant to Section 2.06(e) (including each SwinglineLoan) shall bear interest at the Alternate Base Rate plus the Applicable Margin.

(d) Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder isnot paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment,

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at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the precedingparagraphs of this Section and (ii) in the case of any other amount, 2.25% plus the Alternate Base Rate applicable to ABR Loans as provided in paragraph(c) of this Section.

(e) Accrued interest on each Loan shall be payable by the Borrower in arrears on each Interest Payment Date for such Loan and, in the case ofRevolving Loans, upon termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (e) of this Section shall be payable ondemand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of a Fed Funds or ABR Revolving Loan), accrued interest onthe principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of anyEurocurrency Revolving Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date ofsuch conversion.

(f) All interest hereunder shall be computed on the basis of a year of 360 days except that interest computed by reference to the Alternate BaseRate at times when the Alternate Base Rate is based on the Prime Rate shall be computed on a basis of a year of 365 days (or 366 days in a leap year) and ineach case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The applicable Fed Funds Rate orAlternate Base Rate shall be determined by the Administrative Agent, and any such determination shall be conclusive absent manifest error.

SECTION 2.13. Alternate Rate of Interest. If prior to the commencement of any Interest Period for a Eurocurrency Borrowing:

(a) the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means donot exist for ascertaining the Eurocurrency Rate applicable to such Eurocurrency Borrowing for such Interest Period; or

(b) the Administrative Agent is advised in writing by the Required Lenders that the Eurocurrency Rate applicable to such EurocurrencyBorrowing for such Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or itsLoan) included in such Borrowing for such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or facsimile (or in any other manner approved pursuantto Section 9.01(b)) as promptly as practicable thereafter. If such notice is given pursuant to clause (a) or (b) of this Section 2.13 in respect of anyEurocurrency Loans, then (i) any Eurocurrency Loans requested to be made on the first day of such Interest Period shall be made as Fed Funds Loans, (ii) anyFed Funds Loans that were to have been converted on the first day of such Interest Period to Eurocurrency Loans shall be continued as Fed Funds Loans and(iii) any outstanding Eurocurrency Loans shall be converted, on the last day of the then-current Interest Period, to Fed Funds Loans. Until such notice hasbeen withdrawn by the Administrative Agent, no further Eurocurrency Loans shall be made or continued as such, nor shall the Borrower have the right toconvert Fed Funds Loans to Eurocurrency Loans.

SECTION 2.14. Increased Costs. (a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit or similar requirement (including any such requirement in the nature of aEurocurrency Reserve Requirement) against assets of, deposits with or for the account of, or credit extended by, any Lender; or

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(ii) impose on any Lender or the London interbank market any other condition affecting this Agreement or Eurocurrency Loans made by suchLender or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurocurrency Loan (or of maintaining itsobligation to make any such Loan) or to increase the cost to such Lender or to reduce the amount of any sum received or receivable by such Lender hereunder(whether of principal, interest or otherwise), then, upon the request of such Lender, the Borrower will pay to such Lender, such additional amount or amountsas will compensate such Lender, for such additional costs incurred or reduction suffered.

(b) If any Lender determines that any Change in Law affecting such Lender regarding capital requirements has or would have the effect ofreducing the rate of return on such Lender's capital or on the capital of such Lender's holding company, if any, as a consequence of this Agreement or theLoans made by such Lender to a level below that which such Lender or such Lender's holding company could have achieved but for such Change in Law(taking into consideration such Lender's policies and the policies of such Lender's holding company with respect to capital adequacy), then from time to timethe Borrower will pay to such Lender, such additional amount or amounts as will compensate such Lender or such Lender's holding company for any suchreduction suffered.

(c) A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case maybe, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall paysuch Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

(d) Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender'sright to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costsor reductions incurred more than 180 days prior to the date that such Lender notifies the Borrower in writing of the Change in Law giving rise to suchincreased costs or reductions and of such Lender's intention to claim compensation therefor; provided further that, if the Change in Law giving rise to suchincreased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

SECTION 2.15. Break Funding Payments. In the event of (a) the payment of any principal of any Eurocurrency Loan other than on the last day ofan Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurocurrency Loan other than on the last day ofthe Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Eurocurrency Loan on the date specified in any noticedelivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.09(b) and is revoked in accordance therewith), or (d) theassignment of any Eurocurrency Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant toSection 2.17, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of aEurocurrency Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of(i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Eurocurrency Rate that wouldhave been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of afailure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which wouldaccrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, fordeposits in the relevant currency of a comparable

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amount and period from other banks in the eurocurrency market. A certificate of any Lender setting forth any amount or amounts that such Lender is entitledto receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender theamount shown as due on any such certificate within 10 Business Days after receipt thereof.

SECTION 2.16. Taxes. (a) Any and all payments by or on account of any obligation of the Borrower shall be made free and clear of and withoutdeduction for any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be required to deduct any Indemnified Taxes or Other Taxes fromsuch payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions for Indemnified Tax and Other Taxes(including deductions applicable to additional sums payable under this Section) the Administrative Agent or Lender (as the case may be) receives an amountequal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions for Indemnified Tax and OtherTaxes and (iii) the Borrower shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law.

(b) In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(c) The Borrower shall indemnify the Administrative Agent and each Lender, within 10 Business Days after written demand therefor, for the fullamount of any Indemnified Taxes or Other Taxes paid by the Administrative Agent or such Lender, as the case may be, on or with respect to any payment byor on account of any obligation of the Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amountspayable under this Section) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such IndemnifiedTaxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority; provided that, the Administrative Agent or theLender, as the case may be, shall cooperate with the Borrower for the refund of incorrectly or illegally imposed Taxes. A certificate as to the amount of suchpayment or liability delivered to the Borrower by a Lender or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusiveabsent manifest error.

(d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrowershall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copyof the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

(e) Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which theBorrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with acopy to the Administrative Agent), at the time or times prescribed by applicable law, such properly completed and executed documentation prescribed byapplicable law or reasonably requested by the Borrower as will permit such payments to be made without withholding or at a reduced rate.

(f) If the Administrative Agent or a Lender determines, in its sole discretion, that it has received a refund of any Taxes or Other Taxes as to whichit has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts pursuant to this Section 2.16, it shall pay oversuch refund to the Borrower (but only to the extent of indemnity payments made, or additional amounts paid, by it under this Section 2.16 with respect to theTaxes or Other Taxes giving rise to such refund), net of all out-of-pocket expenses of the Administrative Agent or such Lender and without interest (otherthan any interest paid by the relevant Governmental Authority with respect to such refund); provided, that the Borrower, upon the request of theAdministrative Agent or such Lender, agrees to repay

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the amount paid over to the Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the AdministrativeAgent or such Lender in the event the Administrative Agent or such Lender is required to repay such refund to such Governmental Authority. This Sectionshall not be construed to require the Administrative Agent or any Lender to make available its tax returns (or any other information relating to its taxes whichit deems confidential) to the Borrower or any other Person.

SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-offs. (a) The Borrower shall make each payment required to be madeby it hereunder (whether of principal, interest, fees or of amounts payable under Section 2.14, 2.14 or 2.16, or otherwise) prior to 12:00 noon, New York Citytime, on the date when due and in immediately available funds, without set-off or counterclaim. Any amounts received after such time on any date may, in thediscretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. Allsuch payments shall be made to the Administrative Agent at its offices at the New York Office and except that payments pursuant to Sections 2.14, 2.15, 2.16and 9.03 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any such payments received by it for the account ofany other Person to the appropriate recipient promptly following receipt thereof, in each case on a ratable basis. If any payment hereunder shall be due on aday that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest,interest thereon shall be payable for the period of such extension. All payments hereunder shall be made in Dollars.

(b) If any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest onany of its Revolving Loans or Swingline Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its RevolvingLoans and Swingline Loans and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportionshall purchase (for cash at face value) participations in the Revolving Loans and Swingline Loans of other Lenders to the extent necessary so that the benefitof all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respectiveRevolving Loans and Swingline Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto isrecovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of thisparagraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement orany payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or Participant, other thanto the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing andagrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements mayexercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of theBorrower in the amount of such participation.

(c) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to theAdministrative Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that theBorrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due.In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Administrative Agent forthwith ondemand the amount so distributed to such Lender with interest thereon, for each day from and including the date such amount is distributed to it to butexcluding the date of payment to the

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Administrative Agent, at the Federal Funds Effective Rate, and if greater, a rate determined by the Administrative Agent in accordance with banking industryrules on interbank compensation.

(d) If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.04(b), 2.05(d), 2.16(f) or 9.03(c), then theAdministrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the AdministrativeAgent for the account of such Lender to satisfy such Lender's obligations under such Sections until all such unsatisfied obligations are fully paid.

SECTION 2.18. Mitigation Obligations; Replacement of Lenders. (a) If any Lender requests, or expects to request, compensation underSection 2.14, or if the Borrower is required to, expects to be required to, pay any additional amount to any Lender or any Governmental Authority for theaccount of any Lender pursuant to Section 2.16, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking itsLoans hereunder or to assign its rights and obligations hereunder with respect thereto to another of its offices, branches or Affiliates, if, in the judgment ofsuch Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.14 or 2.16, as the case may be, in the futureand (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise subject such Lender to any regulatory, legal or financialdisadvantage. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation orassignment.

(b) If any Lender requests compensation under Section 2.14, or if the Borrower is required to pay any additional amount to any Lender or anyGovernmental Authority for the account of any Lender pursuant to Section 2.16, or if any Lender defaults in its obligation to fund Loans hereunder orbecomes a Defaulting Lender, or if any Lender fails to consent to a proposed amendment or waiver which is consented to by the Required Holders but whichrequires a unanimous approval of all Lenders, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent,require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all its interests,rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender acceptssuch assignment); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent, which consent shall notunreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and Swingline Loans,accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accruedinterest and fees) or the Borrower (in the case of all other amounts) and (iii) in the case of any such assignment resulting from a claim for compensation underSection 2.14 or payments required to be made pursuant to Section 2.16, such assignment will result in a reduction in such compensation or payments. ALender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, thecircumstances entitling the Borrower to require such assignment and delegation cease to apply.

SECTION 2.19. Defaulting Lenders. Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a DefaultingLender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:

(a) fees shall cease to accrue on the unused Commitment of such Defaulting Lender pursuant to Section 2.11(a);

(b) the Commitment and Revolving Credit Exposure of such Defaulting Lender shall not be included in determining whether the RequiredLenders have taken or may take any action hereunder (including any consent to any amendment, waiver or other modification pursuant to

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Section 9.02); provided, that this clause (b) shall not apply to the vote of a Defaulting Lender in the case of an amendment, waiver or other modificationrequiring the consent of such Lender or each Lender affected thereby;

(c) if any Swingline Exposure exists at the time such Lender becomes a Defaulting Lender then (i) all or any part of the Swingline Exposure ofsuch Defaulting Lender shall be reallocated among the non-Defaulting Lenders in accordance with their respective Applicable Percentages but only to theextent the sum of all non-Defaulting Lenders' Revolving Credit Exposures plus such Defaulting Lender's Swingline Exposure does not exceed the total of allnon-Defaulting Lenders' Commitments; and (ii) if the reallocation described in clause (i) above cannot, or can only partially, be effected, the Borrower shallwithin one Business Day following notice by the Administrative Agent, prepay such Swingline Exposure; and

(d) so long as such Lender is a Defaulting Lender, each Swingline Lender shall not be required to fund any Swingline Loan, and participatinginterests in any newly made Swingline Loan shall be allocated among non-Defaulting Lenders in a manner consistent with Section 2.19(c)(i) (and suchDefaulting Lender shall not participate therein).

If (i) a Bankruptcy Event with respect to any Person as to which any Lender is, directly or indirectly, a subsidiary shall occur following the datehereof and for so long as such event shall continue or (ii) any Swingline Lender has a good faith belief that any Lender has defaulted in fulfilling itsobligations under one or more other agreements in which such Lender commits to extend credit, such Swingline Lender shall not be required to fund anySwingline Loan unless such Swingline Lender shall have entered into arrangements with the Parent, the Borrower or such Lender, satisfactory to suchSwingline Lender, to defease any risk to it in respect of such Lender hereunder.

In the event that the Administrative Agent, the Borrower and the Swingline Lenders each agrees that a Defaulting Lender has adequatelyremedied all matters that caused such Lender to be a Defaulting Lender, then the Swingline Exposure of the Lenders shall be readjusted to reflect theinclusion of such Lender's Commitment and on such date such Lender shall purchase at par such of the Loans of the other Lenders (other than SwinglineLoans) as the Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans in accordance with its ApplicablePercentage.

SECTION 2.20. Additional Commitments. The Borrower shall have the right at any time and from time to time on or after the Effective Date, toagree with any Lender upon an increase in the Commitment of such Lender or to add as a "Lender" with a new Commitment another financial institution orother entity (each such Lender or other financial institution or entity, an "Additional Commitment Lender," and each such Commitment, an "AdditionalCommitment"), provided that the aggregate amount of the Additional Commitments obtained on or after the Effective Date shall not exceed $125,000,000.Each Additional Commitment may be (a) reduced from time to time pursuant to Section 2.07 and (b) as to any Additional Lender or assignee thereof, reducedor increased from time to time pursuant to assignments by or to it pursuant to Section 9.04. Upon any Additional Commitment becoming effective, theBorrower shall borrow such Revolving Loans thereunder and make such prepayments of the other Revolving Loans as may be required in order to make theoutstanding Revolving Loans under such Additional Commitment ratable with the Revolving Loans outstanding under the other Commitments, all in amanner as reasonably determined by the Administrative Agent in consultation with the Borrower and the relevant Additional Commitment Lender, it beingunderstood that such determinations may modify and supersede other provisions hereof as to requirements for notice, minimum amounts, Interest Periods andother similar items, but any required prepayments shall in any event be subject to Section 2.15. The Borrower will provide such additional documents andfilings as the Administrative Agent may reasonably require to assure that the Revolving Loans in respect of Additional

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Commitments are secured by the Collateral ratably with all other Revolving Loans. Each Additional Commitment Lender shall enter into documentationreasonably satisfactory to the Borrower and the Administrative Agent to evidence and provide for its Additional Commitment. Any Additional CommitmentLender which is not a Lender shall be reasonably satisfactory to the Administrative Agent.

ARTICLE III

Representations and Warranties

Each of the Parent, the Borrower and MF USA represents and warrants to the Lenders that:

SECTION 3.01. Organization; Powers. Each of the Parent, the Borrower, MF USA and the Parent's other Significant Subsidiaries is validlyexisting and in good standing under the laws of the jurisdiction of its organization or formation, has all requisite power and authority to carry on its businessas now conducted and is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required, except where thefailure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.02. Authorization; Enforceability. The Transactions are within the corporate powers of the Parent, Borrower and MF USA and havebeen duly authorized by all necessary corporate and, if required, stockholder action. This Agreement and each other Loan Document has been duly executedand delivered by each Loan Party party thereto, and constitutes a legal, valid and binding obligation of each Loan Party party thereto, enforceable inaccordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors' rights generally andsubject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of, registration or filingwith, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, and except where suchfailure to obtain or make such consent, approval, registration, filing or other action could not reasonably be expected to have a Material Adverse Effect,(b) will not violate any applicable law or regulation or the charter, by-laws or other organizational documents of the Parent, the Borrower, MF USA or any ofthe Parent's other Significant Subsidiaries or any order of any Governmental Authority, (c) will not violate or result in a default under any indenture,agreement or other instrument binding upon the Parent, the Borrower, MF USA or any of the Parent's Significant Subsidiaries or their respective assets, orgive rise to a right thereunder to require any payment to be made by any of the foregoing entities, and except where such failure to obtain or make suchconsent, approval, registration, filing or other action could not reasonably be expected to have a Material Adverse Effect, and (d) will not result in the creationor imposition of any Lien on any asset of the Parent, the Borrower, MF USA or any of their Subsidiaries.

SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The Parent has made available to the Lenders its consolidated balancesheet and consolidated statements of operations, comprehensive income, changes in equity and cash flows as of the end of and for each of its fiscal yearsended March 31, 2010 and March 31, 2011, in each case reported on by PricewaterhouseCoopers LLP. Such consolidated financial statements present fairly,in all material respects, the financial position, results of operations, changes in equity and cash flows of the Parent as of the dates and for the fiscal yearsreferred to therein in accordance with GAAP.

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(b) The Borrower has made available to the Lenders its financial statements as of the end of and for each of its fiscal years ended March 31, 2010and March 31, 2011, on FOCUS Reports, reported on by PricewaterhouseCoopers LLP. Such financial statements present fairly, in all material respects, thefinancial position and results of operations of the Borrower as of the dates and for the fiscal years referred to therein.

(c) There has been no material adverse change in the business, assets, operations or condition, financial or otherwise, of the Parent and itsSubsidiaries, taken as a whole, from that indicated in the most recent of the consolidated financial statements referred to in Section 3.04(a), except as may bedisclosed prior to the Effective Date in the Parent's most recent filing on Form 10-K and subsequent filings on Form 8-K made with the SEC.

SECTION 3.05. Properties. (a) Each of the Parent and its Subsidiaries has good title to, or valid leasehold interests in, all its real and personalproperty material to its business, except for minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilizesuch properties for their intended purposes, or where such defects could not otherwise reasonably be expected to have a Material Adverse Effect.

(b) Each of the Parent and its Subsidiaries owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and other intellectualproperty material to its business, and the use thereof by the Parent and its Subsidiaries does not infringe upon the rights of any other Person, except for anysuch infringements that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.06. Litigation and Environmental Matters. (a) There are no actions, suits or proceedings by or before any arbitrator or GovernmentalAuthority pending against or, to the knowledge of the Parent, the Borrower or MF USA, threatened against or affecting the Parent or any of its Subsidiaries(i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or inthe aggregate, to result in a Material Adverse Effect (other than the Disclosed Matters) or (ii) that involve this Agreement or the Transactions.

(b) Except for the Disclosed Matters and except with respect to any other matters that, individually or in the aggregate, could not reasonably beexpected to result in a Material Adverse Effect, neither the Parent nor any of its Subsidiaries (i) has failed to comply with any Environmental Law or toobtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any EnvironmentalLiability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability.

(c) Since the date of this Agreement, there has been no change in the status of the Disclosed Matters that, individually or in the aggregate, hasresulted in, or could reasonably be expected to result in a Material Adverse Effect.

SECTION 3.07. Compliance with Laws and Agreements. Each of the Parent and its Subsidiaries is in compliance with all laws, regulations andorders of any Governmental Authority or any applicable self-regulatory organization applicable to it or its property (including any regulatory capital or similarrequirement) and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in theaggregate, could not reasonably be expected to result in a Material Adverse Effect. No Default has occurred and is continuing.

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SECTION 3.08. Investment Company Status. Neither the Parent nor any of its Subsidiaries is an "investment company" as defined in, or subjectto regulation under, the Investment Company Act of 1940.

SECTION 3.09. Taxes. Each of the Parent and its Subsidiaries has timely filed or caused to be filed all Tax returns required to have been filedand has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedingsand for which the Parent or such Subsidiary, as applicable, has set aside on its books adequate reserves or (b) to the extent that the failure to do so could notreasonably be expected to result in a Material Adverse Effect.

SECTION 3.10. ERISA. No ERISA Event has occurred during the 5 year period prior to the date on which this representation is made or deemedmade with respect to any Plan and none is likely to occur, and no Lien in favor of the PBGC or a Plan has arisen during such five year period, (ii) each Planhas complied, and is in compliance, with its terms and the applicable provisions of ERISA and the Code; (iii) the present value of all accumulated benefitobligations under each Plan (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of themost recent financial statements reflecting such amounts, exceed the fair market value of the assets of such Plan (iv) neither the Borrower nor any ERISAAffiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Plan, and (v) neither Borrower nor any ERISAAffiliate would become subject to any Withdrawal Liability if the Borrower or an ERISA Affiliate were to withdraw completely from all Multiemployer Plansas of the valuation date most closely preceding the date on which this representation is made or deemed made, except, with respect to each of the foregoingclauses, as could not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.

SECTION 3.11. Disclosure. Neither the Information Memorandum nor any of the other reports, financial statements, certificates or other writteninformation (other than projected financial information) furnished by or on behalf of the Parent, the Borrower or MF USA to the Administrative Agent or anyLender in connection with the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished) whentaken as a whole contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements containedtherein taken as a whole, in the light of the circumstances under which they were made, not materially misleading; provided that, with respect to projectedfinancial information, the Parent, the Borrower and MF USA each represent only that such information was prepared in good faith based upon assumptionsbelieved to be reasonable at the time (it being understood that the actual results may vary from the projected financial information).

SECTION 3.12. Federal Regulations. No part of the proceeds of any Loans will be used for "buying," "purchasing" or "carrying" any "marginstock" within the respective meanings of each of the quoted terms under Regulation U of the Board of Governors of the Federal Reserve System as now andfrom time to time hereafter in effect in any manner which violates or would cause the Lenders to violate the provisions of the Regulations of such Board ofGovernors.

SECTION 3.13. Purpose of Loans. The proceeds of the Loans shall be used by the Borrower for general corporate purposes.

SECTION 3.14. Material Licenses and Memberships. The Parent and its Subsidiaries possess all licenses, memberships, registrations, permitsand approvals necessary for the conduct of their respective businesses as now conducted as required by law or applicable rules and regulations, includingunder any applicable rules of the SEC, the National Association of Securities Dealers, Inc. ("NASD"), the

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Commodity Futures Trading Commission (the "CFTC"), the Chicago Board of Exchange ("CBOE"), the Chicago Mercantile Exchange (the "CME") and theFinancial Services Authority ("FSA") and of the other principal futures, options and other exchanges on which any of them trades except where any failure todo so, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

ARTICLE IV

Conditions

SECTION 4.01. Effective Date. The obligations of the Lenders to make Loans by it shall not become effective until the date on which each of thefollowing conditions is satisfied (or waived in accordance with Section 9.02):

(a) Credit Agreement; Security Agreement; Guaranty. On or prior to the Effective Date, the Administrative Agent shall have received (i) thisAgreement executed and delivered by each party hereto, (ii) the Security Agreement and (iii) the Guaranty, executed and delivered by the parties thereto.

(b) Legal Opinions. The Administrative Agent shall have received a favorable written opinion (addressed to the Administrative Agent and theLenders and dated the Effective Date) of (i) Laurie Ferber, general counsel for the Parent, the Borrower and MF USA and (ii) Sullivan & Cromwell LLP,special New York counsel for the Parent, the Borrower and MF USA, substantially in the form of Exhibit C-1, in each case covering such other mattersrelating to the Parent, the Borrower and MF USA, this Agreement or the Transactions as the Required Lenders shall reasonably request. The Parent, Borrowerand MF USA hereby request such counsel to deliver such opinion.

(c) Closing Certificate; Certified Certificate of Incorporation; Good Standing Certificate. The Administrative Agent shall have received (i) acertificate of each of the Borrower, the Parent and MF USA, dated the Effective Date, substantially in the form of Exhibits D-1 and D-2, with appropriateinsertions and attachments, including the certificate of incorporation of each of the Borrower, the Parent and MF USA certified by the relevant authority of thejurisdiction of its organization, and (ii) a long form good standing certificate for each of the Borrower, the Parent and MF USA from its jurisdiction oforganization.

(d) Fees. The Administrative Agent shall have received all fees and other amounts due and payable on or prior to the Effective Date, including, tothe extent invoiced, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower hereunder.

(e) Patriot Act. The Lenders shall have received Patriot Act and "know your customer" / anti-money laundering documentation and informationreasonably requested by the Lenders in writing at least 2 Business Days prior to the Closing Date.

The Administrative Agent shall notify the Borrower and the Lenders of the Effective Date, and such notice shall be conclusive and binding. Notwithstandingthe foregoing, the obligations of the Lenders to make Loans hereunder shall not become effective unless each of the foregoing conditions is satisfied (orwaived pursuant to Section 9.02) at or prior to 3:00 p.m., New York City time, on [ ], 2011 (and, in the event such conditions are not so satisfied or waived,the Commitments shall terminate at such time).

SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing, is subject to thesatisfaction of the following conditions:

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(a) The representations and warranties of the Parent, the Borrower and MF USA set forth in Article III (other than those contained inSection 3.04(c) and Section 3.06), shall be true and correct on and as of the date of such Borrowing (except with respect to Borrowings made on the EffectiveDate, in which case the representations made in Section 3.04(c) and Section 3.06 shall be made).

(b) At the time of and immediately after giving effect to such Borrowing, no Default or Event of Default shall have occurred and be continuing.

Each Borrowing shall be deemed to constitute a representation and warranty by the Parent, the Borrower and MF USA on the date thereof as to the mattersspecified in paragraphs (a) and (b) of this Section.

ARTICLE V

Affirmative Covenants

Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall havebeen paid in full, each of the Parent and the Borrower covenants (to the extent provided in relation to itself below) and agrees with the Lenders that:

SECTION 5.01. Financial Statements; Ratings Change and Other Information. The Parent will furnish to the Administrative Agent (in a formreasonably satisfactory to the Administrative Agent):

(a)(i) within 90 days after the end of each fiscal year of the Parent, its audited consolidated balance sheet and related statements of operations,comprehensive income, changes in equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for theprevious fiscal year, all reported on by PricewaterhouseCoopers LLP or other independent public accountants of recognized national standing (without a"going concern" or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidatedfinancial statements present fairly in all material respects the financial condition and results of operations of the Parent and its consolidated Subsidiaries on aconsolidated basis in accordance with GAAP consistently applied and (ii) within 90 days after the end of each fiscal year of the Borrower, its audited balancesheet as at the end of such year and the related audited statements of income and of cash flows for such year, setting forth in each case in comparative formthe figures for the previous year, all reported on by PricewaterhouseCoopers LLP or other independent public accountants of recognized national standing(without a "going concern" or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that suchfinancial statements present fairly, in all material respects, the financial position and results of operations of the Borrower. Documents required to be deliveredpursuant to this clause (a)(i) which are made available via EDGAR, or any successor system of the SEC, in an Annual Report of the Parent on Form 10-K,shall be deemed delivered to the Lenders on the date such documents are made so available; provided that, upon request, the Parent shall deliver paper copies(or in any other manner approved pursuant to Section 9.01(b)) of such documents to the Administrative Agent;

(b)(i) within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Parent, commencing with the fiscal quarterending September 30, 2011, its consolidated balance sheet and related statements of operations, equity and cash flows as of the end of and for such fiscalquarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or,in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial Officers as presenting fairly in all materialrespects the financial condition and results of operations of the Parent and its consolidated

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Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotesand (ii) not later than 45 days after the end of each of the first three quarterly periods of each fiscal year of the Borrower, the Part II FOCUS Report of theBorrower for such quarter. Documents required to be delivered pursuant to this clause (b) which are made available via EDGAR, or any successor system ofthe SEC, in a Quarterly Report of the Parent on Form 10-Q, shall be deemed delivered to the Lenders on the date such documents are made so available;provided that, upon request, the Parent shall deliver paper copies (or in any other manner approved pursuant to Section 9.01(b)) of such documents to theAdministrative Agent. All such Part II FOCUS Reports shall fairly present in all material respects the financial condition and results of operations of theBorrower.

(c) concurrently with any delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer of the Parent or theBorrower, as applicable, (i) certifying as to whether a Default has occurred and, if a Default has occurred, specifying the details thereof and any action takenor proposed to be taken with respect thereto, (ii) setting forth reasonably detailed calculations demonstrating compliance with Section 6.01 and including foreach relevant period evidence demonstrating compliance with Section 6.08 and (iii) stating whether any change in GAAP or in the application thereof hasoccurred since the date of the audited financial statements referred to in Section 3.04(a) and, if any such change has occurred, specifying the effect of suchchange on the financial statements accompanying such certificate;

(d) concurrently with any delivery of financial statements under clause (a) above, a certificate of the accounting firm that reported on suchfinancial statements stating whether they obtained knowledge during the course of their examination of such financial statements of any Default (whichcertificate may be limited to the extent required by accounting rules or guidelines); and

(e) within a reasonable time following any reasonable written request therefor by or through the Administrative Agent, such other informationregarding the operations, business affairs and financial condition of the Parent or any Subsidiary, or compliance with the terms of this Agreement as may bereasonably requested.

SECTION 5.02. Notices of Material Events. The Parent will furnish to the Administrative Agent and each Lender prompt written notice of thefollowing, upon becoming aware of such event:

(a) the occurrence of any Default;

(b) the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting theParent, the Borrower, MF USA or any Affiliate thereof that could reasonably be expected to, individually or in the aggregate, result in a Material AdverseEffect;

(c)(i) the occurrence of any ERISA Event (and as soon as practicable thereafter, a copy of any report or notice required to be filed with or givento the PBCG by the Parent, the Borrower, MF USA or any ERISA Affiliate with respect to such ERISA Event) that, alone or together with any other ERISAEvent that have occurred or is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect and (ii) promptly followingany request therefor, copies of (A) any documents described in Section 101(k) of ERISA that the Borrower or any ERISA Affiliate may request with respectto any Multiemployer Plan and (B) any notices described in Section 101(l) of ERISA that the Borrower or any ERISA Affiliate may request with respect toany Plan or Multiemployer Plan; and

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(d) any other development that results in, or could reasonably be expected to, individually or in the aggregate, result in, a Material AdverseEffect.

Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer or other executive officer of the Parent setting forth thedetails of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto. Notices required to be deliveredpursuant to this Section 5.02 which are made available via EDGAR, or any successor system of the SEC, in a Current Report of the Parent on Form 8-K, shallbe deemed delivered to the Lenders on the date such notices are made so available; provided that, upon request, the Parent shall deliver paper copies (or in anyother manner approved pursuant to Section 9.01(b)) of such notices to the Administrative Agent.

SECTION 5.03. Existence; Conduct of Business; Material Licenses and Membership. The Parent will, and will cause each of its Subsidiaries to,do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privilegesand franchises material to the conduct of its business, including but not limited to, the maintenance of all permits, licenses, consents and memberships as maybe required for the conduct of its business by any state, national or local government agency or instrumentality of any country or any applicable self-regulatory organization or exchange, except (other than with respect to the maintenance of the existence of the Borrower, the Parent and MF USA) to theextent that failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect; provided that theforegoing shall not prohibit any merger, consolidation, liquidation or dissolution, as permitted under Section 6.04.

SECTION 5.04. Payment of Obligations. The Parent will, and will cause each of its Subsidiaries to, pay its obligations, including Tax liabilities,that, if not paid, could reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect before the same shall become delinquentor in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Parent or such Subsidiary hasset aside on its books adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending such contest could notreasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect.

SECTION 5.05. Maintenance of Properties; Insurance. The Parent will, and will cause each of its Subsidiaries to, (a) keep and maintain allproperty material to the conduct of the business of the Parent and its Subsidiaries, taken as a whole, in good working order and condition, ordinary wear andtear excepted, and (b) maintain, with financially sound and reputable insurance companies, insurance in such amounts and against such risks as arecustomarily maintained by companies engaged in the same or similar businesses operating in the same or similar locations.

SECTION 5.06. Books and Records; Inspection Rights. The Parent will, and will cause each of its Subsidiaries to, keep proper books of recordand account in which full, true and correct entries in all material respects are made of all dealings and transactions in relation to its business and activities. TheParent will, and will cause each of its Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender, upon reasonable priornotice, to visit and inspect its properties during normal business hours, to examine and make extracts from its books and records, and to discuss its affairs,finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested.

SECTION 5.07. Compliance with Laws. The Parent will, and will cause each of its Subsidiaries to, comply with all laws, rules, regulations andorders of any Governmental Authority

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applicable to it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a MaterialAdverse Effect.

ARTICLE VI

Negative Covenants

Until the Commitments have expired or terminated and the principal of and interest on each Loan and all fees payable hereunder have been paidin full, each of the Parent and the Borrower covenants and agrees with the Lenders that:

SECTION 6.01. Financial Covenant. The Borrower will not permit the Consolidated Tangible Net Worth of the Borrower at any time to be lessthan $255,829,000.

SECTION 6.02. Indebtedness. The Parent will not, and will not permit any Subsidiary to, create, incur, assume or permit to exist anyIndebtedness, except:

(a) Indebtedness created hereunder;

(b) Indebtedness existing on the date hereof and set forth in Schedule 6.02 and extensions, renewals and replacements of any such Indebtednessthat do not increase the outstanding principal amount thereof;

(c) Indebtedness of the Parent to any Subsidiary and of any Subsidiary to the Parent or any other Subsidiary;

(d) Guarantees by the Parent, the Borrower or MF USA of Indebtedness of any other Subsidiary and by any Subsidiary of Indebtedness of anyother Subsidiary (other than the Borrower);

(e) Indebtedness of the Parent or any Subsidiary incurred to finance the acquisition, construction or improvement of any fixed or capital assets,including Capital Lease Obligations and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any suchassets prior to the acquisition thereof, and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principalamount thereof; provided that such Indebtedness is incurred prior to or within 180 days after such acquisition or the completion of such construction orimprovement;

(f) Indebtedness of the Parent, the Borrower and MF USA;

(g) Indebtedness of any Subsidiary of the Parent which is a regulated broker or similar entity (including a non-regulated entity engaged in tradingactivities with or on behalf of customers) incurred in the ordinary course of business, including any such Indebtedness in the form of Guarantees of any suchIndebtedness of its Subsidiaries, including Indebtedness incurred in the ordinary course of business to finance or secure the purchase or carrying of securities,the provision of margin for forward, futures, repurchase or similar transactions, the making of advances to customers, the establishment of performance orsurety bonds or guarantees, or in the nature of a letter of credit or letter of guaranty to support or secure trading and other obligations incurred in the ordinarycourse of business, but excluding any such Indebtedness that would be included in any calculation of the regulatory capital (or similar concept) of suchSubsidiary; and

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(h) additional Indebtedness of any of the Subsidiaries of the Parent other than the Borrower at any date in an aggregate principal amount (for allsuch Subsidiaries) not to exceed 10% of the Parent's Consolidated Tangible Net Worth at such date. The amount of additional Indebtedness outstanding at anytime in reliance on this Section 6.02(h) shall be determined on a "net" basis after giving effect to the terms of any legally enforceable netting or offsetarrangements included in or otherwise relating to cash management arrangements with banks and similar institutions.

SECTION 6.03. Liens. The Parent will not, and will not permit any Subsidiary to, create, incur, assume or permit to exist any Lien on anyproperty or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including accounts receivable) or rights in respect of anythereof, except:

(a) Liens created pursuant to the Security Agreement;

(b) Permitted Encumbrances;

(c) any Lien on any property or asset of the Parent or any Subsidiary existing on the date hereof and set forth in Schedule 6.03; provided that(i) such Lien shall not apply to any other property or asset of the Parent or any Subsidiary and (ii) such Lien shall secure only those obligations which itsecures on the date hereof and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof except by theamount of any accrued interest or fees payable by the Parent or such Subsidiary in respect of such obligations;

(d) any Lien existing on any property or asset prior to the acquisition thereof by the Parent or any Subsidiary or existing on any property or assetof any Person that becomes a Subsidiary after the date hereof prior to the time such Person becomes a Subsidiary; provided that (i) such Lien is not created incontemplation of or in connection with such acquisition or such Person becoming a Subsidiary , as the case may be, (ii) such Lien shall not apply to any otherproperty or assets of the Parent or any Subsidiary and (iii) such Lien shall secure only those obligations which it secures on the date of such acquisition or thedate such Person becomes a Subsidiary, as the case may be and extensions, renewals and replacements thereof that do not increase the outstanding principalamount thereof except by the amount of any accrued interest or fees payable by the Parent or such Subsidiary in respect of such obligations;

(e) Liens on fixed or capital assets acquired, constructed or improved by the Parent or any Subsidiary; provided that (i) such security interestssecure Indebtedness permitted by clause (e) of Section 6.02, (ii) such security interests and the Indebtedness secured thereby are incurred prior to or within180 days after such acquisition or the completion of such construction or improvement and (iii) such security interests shall not apply to any other non-relatedproperty or assets of the Parent or any Subsidiary;

(f) Liens created, incurred or assumed by any Subsidiary of the Parent which is (i) a regulated broker or similar entity in the ordinary course ofbusiness upon assets owned by such Subsidiary or held for its account to secure Indebtedness incurred under Section 6.02(g) or other liabilities incurred in theordinary course of business or (ii) otherwise incurred in the ordinary course of its business to secure obligations other than Indebtedness; and

(g) other Liens (on assets other than the Collateral) securing obligations in an aggregate amount not to exceed 10% of the Parent's ConsolidatedTangible Net Worth at any one time outstanding. The amount of other Liens securing obligations outstanding at any time in reliance on this Section 6.03(g)shall be determined on a

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"net" basis after giving effect to the terms of any legally enforceable netting or offset arrangements included in or otherwise relating to cash managementarrangements with banks and similar institutions.

Notwithstanding the foregoing, the exceptions listed in clauses (b) through (g) above shall be limited to Liens on assets other than the Collateral.

SECTION 6.04. Fundamental Changes. (a) The Parent will not, and will not permit any Subsidiary to, merge into or consolidate with any otherPerson, or permit any other Person to merge into or consolidate with it, or sell, transfer, lease or otherwise dispose of (in one transaction or in a series oftransactions) all or substantially all of its assets, or all or substantially all of the stock of any of its Subsidiaries (in each case, whether now owned or hereafteracquired), or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and becontinuing (i) any Person (other than the Parent or the Borrower) may merge into the Parent or the Borrower in a transaction in which the Parent or theBorrower, as the case may be, is the surviving corporation, (ii) any Person (other than the Parent or the Borrower) may merge into any Subsidiary in atransaction in which the surviving entity is a Subsidiary, (iii) any Subsidiary (other than the Borrower) may sell, transfer, lease or otherwise dispose of itsassets to the Parent or the Borrower or to another Subsidiary, (iv) any Subsidiary (other than the Borrower or MF USA) may liquidate or dissolve if the Parentdetermines in good faith that such liquidation or dissolution is in the best interests of the Parent and is not materially disadvantageous to the Lenders and(v) any Subsidiary which is not a Significant Subsidiary may sell, or otherwise dispose of, all or substantially all of its assets.

(b) The Parent will not, and will not permit any of its Subsidiaries to, engage to any material extent in any business other than businesses of thetype conducted by the Parent and its Subsidiaries on the date of execution of this Agreement and businesses reasonably related thereto.

SECTION 6.05. Transactions with Affiliates. The Parent will not, and will not permit any of its Subsidiaries to, sell, lease or otherwise transferany material property or material assets to, or purchase, lease or otherwise acquire any material property or material assets from, or otherwise engage in anyother transactions with, any of its Affiliates, except (a) such transaction is upon fair and reasonable terms no less favorable in all material respects to theParent or the relevant Subsidiary, as applicable, than it would obtain in a comparable arm's length transaction with a Person that is not an Affiliate,(b) transactions between or among the Parent and its wholly owned Subsidiaries not involving any other Affiliate and (c) any transactions listed on Schedule6.05.

SECTION 6.06. Regulatory Capital. The Parent will not, and will not permit any of its Subsidiaries to, fail to satisfy (beyond any applicablegrace period, including any period as to which only minor penalties or restrictions are applicable) any regulatory or net capital or financial resourcesrequirement applicable to it in its capacity as a regulated broker or similar entity or as a parent of any such entity under (a) applicable law or (b) any self-regulatory or similar organization of which it is a member or which regulates the conduct of any material portion of the business of the Parent and theSubsidiaries taken as a whole (including any such requirement of an exchange on which it conducts a material portion of such business), unless in the case of(b) the maintenance of such membership or the conduct of such business under the jurisdiction of such self-regulatory or similar organization or on suchexchange is not material to its consolidated businesses by virtue of there being other venues or exchanges available to it for the conduct of such businesses onterms not materially disadvantageous to the Parent and its Subsidiaries taken as a whole.

SECTION 6.07. Minimum Liquidity Ratio. The Parent will not permit the ratio for any of its Subsidiaries that is a regulated broker dealer orfutures commission merchant of (x) its unencumbered marketable securities (after taking into account prudent and customary financing

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deductions as reasonably determined by the Parent) plus its unencumbered cash (other than any such securities or cash representing proceeds of "segregated"or "non-segregated" customer funds) to (y) its short-term unsecured consolidated Indebtedness (other than any short-term unsecured Indebtedness incurred forthe purpose of financing margin flows to the extent there is excess availability for borrowing under the Existing Credit Agreement to refinance suchIndebtedness through an advance to or other investment in such Subsidiary and such Borrowing would not then be short-term) at any time to be less than 1.0to 1.0.

SECTION 6.08. Pledged Eligible Asset Deficiencies. The Parent will not permit any Deficiency with respect to the aggregate Loan Value of thePledged Eligible Assets to exist for more than one Business Day after receipt of a Deficiency Notice from the Administrative Agent.

ARTICLE VII

Events of Default

If any of the following events ("Events of Default") shall occur:

(a) the Borrower shall fail to pay any principal of any Loan when and as the same shall become due and payable (including pursuant toSection 2.10(a)), whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;

(b) the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of thisArticle) payable under this Agreement, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of fiveBusiness Days;

(c) any representation or warranty made or deemed made by or on behalf of the Parent, the Borrower or MF USA in or in connection with thisAgreement or any other Loan Document, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with thisAgreement or any other Loan Document, shall prove to have been materially incorrect when made or deemed made;

(d) the Parent, the Borrower or MF USA shall fail to observe or perform any covenant, condition or agreement contained in (i) Section 5.02, 5.03(with respect to the Parent's, the Borrower's and MF USA's existence), 6.01 or 6.08 or (ii) Section 6.02, 6.03, 6.04, 6.05 or Section 6.06, and in the case ofclause (ii) such failure shall continue unremedied for a period of five Business Days after the earlier of (A) notice of such failure from the AdministrativeAgent or any Lender or (B) the actual knowledge of such failure by a Financial Officer;

(e) the Parent, the Borrower or MF USA shall fail to observe or perform any covenant, condition or agreement contained in this Agreement (otherthan those specified in clause (a), (b) or (d) of this Article) or any other Loan Document, and such failure shall continue unremedied for a period of 30 daysafter notice thereof from the Administrative Agent to the Borrower (which notice will be given at the request of any Lender);

(f) the Parent or any Subsidiary shall fail to make any payment (whether of principal or interest or any other amount and regardless of amount) inrespect of any Material Indebtedness, when and as the same shall become due and payable (after giving effect to any grace periods applicable thereto);

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(g) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or requires theprepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided that this clause (g) shall not apply to securedIndebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness;

(h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief inrespect of the Parent or any of its Significant Subsidiaries, or its debts, or of a substantial part of its assets (or, in the case of any such Significant Subsidiary,for all or substantially all of its assets), under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or(ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Parent or any Significant Subsidiary or for asubstantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving orordering any of the foregoing shall be entered;

(i) the Parent or any Significant Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganizationor other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institutionof, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to theappointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Parent or any of its Significant Subsidiaries, or for asubstantial part of its assets (or, in the case of any such Subsidiary or any such Significant Subsidiary, for all or substantially all of its assets), (iv) file ananswer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or(vi) take any action for the purpose of effecting any of the foregoing;

(j) the Parent or any Significant Subsidiary shall become unable, admit in writing its inability or fail generally to pay its debts as they becomedue;

(k) one or more judgments for the payment of money in an aggregate amount in excess of $50,000,000 shall be rendered against the Parent, anySubsidiary or any combination thereof and the same shall remain unpaid or otherwise undischarged for a period of 60 consecutive days during whichexecution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of the Parent or anySubsidiary to enforce any such judgment;

(l) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when taken together with all other ERISA Events that haveoccurred, could reasonably be expected to result in a Material Adverse Effect and such event shall continue unremedied for a period of 60 consecutive days;

(m) the Guaranty, the Security Agreement and the Liens created thereunder shall not be, or shall cease to be, enforceable against the Parent, theBorrower or MF USA in any material respect or any such Person shall so assert in writing;

(n) the Parent or any other borrower thereunder shall fail to observe or perform any covenant, condition or agreement contained in the ExistingCredit Agreement after giving effect to any grace period applicable thereto in the Existing Credit Agreement; or

(o) a Change in Control shall occur.

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then, and in every such event (other than an event with respect to the Borrower described in clause (h) or (i) of this Article), and at any time thereafter duringthe continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take either or bothof the following actions, at the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall terminate immediately, and(ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable maythereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interestthereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand,protest or other notice of any kind, all of which are hereby waived by the Borrower; and in case of any event with respect to the Borrower described in clause(h) or (i) of this Article, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereonand all fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest orother notice of any kind, all of which are hereby waived by the Borrower.

ARTICLE VIII

The Administrative Agent

Each of the Lenders hereby irrevocably appoints the Administrative Agent as its agent and authorizes the Administrative Agent to take suchactions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof, together with such actions and powers asare reasonably incidental thereto.

The bank serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lenderand may exercise the same as though it were not the Administrative Agent, and such bank and its Affiliates may accept deposits from, lend money to andgenerally engage in any kind of business with the Parent or any Subsidiary or other Affiliate thereof as if it were not the Administrative Agent hereunder.

The Administrative Agent shall not have any duties or obligations except those expressly set forth herein. Without limiting the generality of theforegoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and iscontinuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionaryrights and powers expressly contemplated hereby that the Administrative Agent is required to exercise in writing as directed by the Required Lenders (or suchother number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02), and (c) except as expressly set forthherein, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Parent orany of its Subsidiaries that is communicated to or obtained by the bank serving as Administrative Agent or any of its Affiliates in any capacity. TheAdministrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders (or such othernumber or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02) or in the absence of its own gross negligenceor willful misconduct. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until written notice thereof is given to theAdministrative Agent by the Parent or the Borrower or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain orinquire into (i) any statement, warranty or representation made in or in connection with this Agreement, (ii) the contents of any certificate, report or otherdocument delivered hereunder or in connection herewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditionsset forth herein, (iv) the validity, enforceability,

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effectiveness or genuineness of this Agreement or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article IVor elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent,statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person. The Administrative Agentalso may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall not incur any liability forrelying thereon. The Administrative Agent may consult with legal counsel (who may be counsel for the Parent or the Borrower), independent accountants andother experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants orexperts.

The Administrative Agent may perform any and all its duties and exercise its rights and powers by or through any one or more sub-agentsappointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all its duties and exercise its rights andpowers through their respective Related Parties. The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the RelatedParties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the creditfacilities provided for herein as well as activities as Administrative Agent.

Subject to the appointment and acceptance of a successor Administrative Agent as provided in this paragraph, the Administrative Agent mayresign at any time by notifying the Lenders and the Borrower. Upon any such resignation, the Required Lenders shall have the right, in consultation with theBorrower, to appoint a successor reasonably acceptable to the Borrower (except that the Borrower's consent shall not be required if a Default or Event ofDefault has occurred and is continuing). If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointmentwithin 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may, on behalf of the Lenders,appoint a successor Administrative Agent reasonably acceptable to the Borrower (except that the Borrower's consent shall not be required if a Default orEvent of Default has occurred and is continuing) which shall be a bank with an office in New York, New York, or an Affiliate of any such bank. Upon theacceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights,powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligationshereunder. The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwiseagreed between the Borrower and such successor. After the Administrative Agent's resignation hereunder, the provisions of this Article and Section 9.03 shallcontinue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken oromitted to be taken by any of them while it was acting as Administrative Agent.

Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on suchdocuments and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender alsoacknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents andinformation as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon thisAgreement, any related agreement or any document furnished hereunder or thereunder.

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ARTICLE IX

Miscellaneous

SECTION 9.01. Notices. (a) Except in the case of notices and other communications expressly permitted to be given by telephone (and subject toparagraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service,mailed by certified or registered mail or sent by facsimile (or in any other manner approved pursuant to Section 9.01(b)), as follows: (i) The Borrower:

MF Global Inc.55 East 52nd Street39th FloorNew York NY 10055Attention: David Dunne, Global Treasurer

with a copy to:

Joe LesarFacsimile: (212) 589 6236Email: [email protected] with an additional copy to: laurie Ferber- General CounselFacsimile: (212) 319 1565Email: [email protected]

(ii) The Parent:

c/o MF Global Holdings Ltd.55 East 52nd Street39th FloorNew York NY 10055Attention: David Dunne, Global Treasurer

with a copy to:

Joe LesarFacsimile: (212) 589 6236Email: [email protected] with an additional copy to: laurie Ferber- General CounselFacsimile: (212) 319 1565Email: [email protected]

with an additional copy to:

Laurie Ferber- General CounselFacsimile: (212) 319 1565Email: [email protected]

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(ii) The AdministrativeAgent:

JPMorgan Chase Bank, N.A.Loan and Agency Services500 Stanton Christiana RoadOps4, Floor 03Newark, DE 19713-2107Attention: Christina SherlockFacsimile: (917) 464-9985

with a copy to:

JPMorgan Chase Bank, N.A.270 Park Avenue, 15th FloorNew York, New York 10017Attention: Henry E. SteuartFacsimile: (212) 270-4617

(iii) Any other Lender:

to it at its address (or facsimile (or in any other manner approvedpursuant to Section 9.01(b))) set forth in its AdministrativeQuestionnaire.

(b) Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communications pursuant toprocedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Article II unless otherwise agreed by theAdministrative Agent and the applicable Lender. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and othercommunications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may belimited to particular notices or communications.

(c) Any party hereto may change its address or facsimile number for notices and other communications hereunder by notice to the other partieshereto. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have beengiven on the date of receipt.

SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the Administrative Agent or any Lender in exercising any right or powerhereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of stepsto enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of theAdministrative Agent and the Lenders hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver ofany provision of this Agreement or any other Loan Document or consent to any departure by the Parent, the Borrower therefrom shall in any event beeffective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instanceand for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default,regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default at the time.

(b) Neither this Agreement or any other Loan Document nor any provision hereof or thereof may be waived, amended or modified exceptpursuant to an agreement or agreements in writing entered into by the Parent, the Borrower and the Required Lenders or by the Borrower and theAdministrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without thewritten consent of such Lender, (ii) reduce the

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principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender affectedthereby, (iii) postpone the scheduled date of payment of the principal amount of any Loan or any interest thereon, or any fees payable hereunder, or reduce theamount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent of each Lenderaffected thereby, (iv) change Section 2.17(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby, without the written consentof each Lender, (v) release any Collateral (except as provided for in the Loan Documents) or release the Parent, the Borrower or MF USA from theirrespective obligations under the Guaranty and the Security Agreement, without the written consent ofeach Lender, (vi) change any of the provisions of thisSection or the definition of "Required Lenders" or any other provision hereof specifying the number or percentage of Lenders required to waive, amend ormodify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender, (vii) amend or modify thedefinitions of "Eligible Assets" or "Loan Value", to the extent such amendment or modification would result in a less restrictive standard than set forth in suchdefinitions, in each case without the written consent of the Supermajority Lenders or (viii) amend Schedule 1.01 hereto without the written consent of theSupermajority Lenders; provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent orthe Swingline Lenders hereunder without the prior written consent of the Administrative Agent or the Swingline Lenders, as the case may be.

SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by theAdministrative Agent and its Affiliates, including the reasonable fees, charges and disbursements of Simpson Thacher & Bartlett LLP, counsel for theAdministrative Agent, in connection with the syndication of the credit facilities provided for herein, the preparation and administration of this Agreement orany amendments, modifications or waivers of the provisions hereof (whether or not the transactions contemplated hereby or thereby shall be consummated)and (ii) all reasonable out-of-pocket expenses incurred by the Administrative Agent or any Lender, including the reasonable fees, charges and disbursementsof any one counsel for the Administrative Agent or any Lender, in connection with the enforcement or protection of its rights in connection with thisAgreement or any agreement or instrument contemplated hereby.

(b) The Borrower shall indemnify the Administrative Agent, each Lender and each Related Party of any of the foregoing Persons (each suchPerson being called an "Indemnitee") against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses,including the reasonable fees, charges and disbursements of one counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, inconnection with, or as a result of (i) the execution or delivery of this Agreement or any agreement or instrument contemplated hereby, the performance by theparties hereto of their respective obligations hereunder or the consummation of the Transactions or any other transactions contemplated hereby, (ii) any Loanor the use of the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by theParent or any of its Subsidiaries, or any Environmental Liability related in any way to the Parent or any of its Subsidiaries, or (iv) any actual or prospectiveclaim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether anyIndemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages,liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the grossnegligence or willful misconduct of such Indemnitee.

(c) To the extent that the Borrower fails to pay any amount required to be paid by it to the Administrative Agent under paragraph (a) or (b) of thisSection, each Lender severally agrees to pay to the Administrative Agent, such Lender's Applicable Percentage (determined as of the time that the

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applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim,damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent.

(d) To the extent permitted by applicable law, each of the Parent, the Borrower and MF USA shall not assert, and hereby waives, any claimagainst any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising outof, in connection with, or as a result of, this Agreement or any agreement or instrument contemplated hereby, the Transactions, any Loan or the use of theproceeds thereof.

(e) All amounts due under this Section shall be payable not later than five Business Days after written demand therefor.

SECTION 9.04. Successors and Assigns. (a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties heretoand their respective successors and assigns permitted hereby, except that (i) the Parent, the Borrower or MF USA may not assign or otherwise transfer any ofits rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Parent, the Borrower orMF USA without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except inaccordance with this Section. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto,their respective successors and assigns permitted hereby, Participants (to the extent provided in paragraph (c) of this Section) and, to the extent expresslycontemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or byreason of this Agreement.

(b)(i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more assignees all or a portion of its rightsand obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it) with the prior written consent (suchconsent not to be unreasonably withheld or delayed) of:

(A) the Borrower, provided that no consent of the Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, anApproved Fund or, if an Event of Default has occurred and is continuing, any other assignee, it being understood that it would be reasonable for theBorrower to withhold consent for an assignment to any Person other than a banking institution; and

(B) the Administrative Agent, provided that no consent of the Administrative Agent shall be required for an assignment of anyCommitment to an assignee that is a Lender with a Commitment immediately prior to giving effect to such assignment.

(ii) Assignments shall be subject to the following additional conditions:

(A) except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of theassigning Lender's Commitment or Loans, the amount of the Commitment or Loans of the assigning Lender subject to each such assignment(determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be lessthan $5,000,000 and an integral multiple of $1,000,000 unless each of the Borrower and the Administrative Agent otherwise consent (such consent notto be unreasonably withheld or delayed), provided that no such consent of the Borrower shall be required if an Event of Default has occurred and iscontinuing;

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(B) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender's rights and obligations underthis Agreement;

(C) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with aprocessing and recordation fee of $3,500, which fees shall not be payable by the Borrower, except in connection with the replacement of a Lenderpursuant to Section 2.17;

(D) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire in which theassignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information about theBorrower and its Related Parties or its securities) will be made available and who may receive such information in accordance with the assignee'scompliance procedures and applicable laws, including Federal and state securities laws; and

(E) no assignments may be made to any natural persons.

For the purposes of this Section 9.04(b), the term "Approved Fund" has the following meaning:

"Approved Fund" means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans andsimilar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) anentity or an Affiliate of an entity that administers or manages a Lender.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section, from and after the effective date specified in eachAssignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption,have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by suchAssignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of theassigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits ofSections 2.13, 2.14, 2.15 and 9.03). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with thisSection 9.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance withparagraph (c) of this Section.

(iv) The Administrative Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices a copy of each Assignmentand Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount ofthe Loans owing to, each Lender pursuant to the terms hereof from time to time (the "Register"). The entries in the Register shall be conclusive, and theBorrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lenderhereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and anyLender, at any reasonable time and from time to time upon reasonable prior notice.

(v) Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee's completedAdministrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of thisSection and any written consent to such assignment required by paragraph (b) of this

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Section, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided that ifeither the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to Section 2.04(b), 2.05(d), 2.16(f) or9.03(c), the Administrative Agent shall have no obligation to accept such Assignment and Assumption and record the information therein in the Registerunless and until such payment shall have been made in full, together with all accrued interest thereon. No assignment shall be effective for purposes of thisAgreement unless it has been recorded in the Register as provided in this paragraph.

(c)(i) Any Lender may, without the consent of the Borrower, the Administrative Agent or any Swingline Lender, sell participations to one ormore banks or other entities (a "Participant") in all or a portion of such Lender's rights and obligations under this Agreement (including all or a portion of itsCommitment and the Loans owing to it); provided that (A) such Lender's obligations under this Agreement shall remain unchanged, (B) such Lender shallremain solely responsible to the other parties hereto for the performance of such obligations and (C) the Borrower, the Administrative Agent and the otherLenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement. Anyagreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce thisAgreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument mayprovide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso toSection 9.02(b) that affects such Participant. Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each Participant shall be entitled to thebenefits of Sections 2.14, 2.15 and 2.16 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of thisSection. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender, provided suchParticipant agrees to be subject to Section 2.17(c) as though it were a Lender.

(ii) A Participant shall not be entitled to receive any greater payment under Section 2.14 or 2.16 than the applicable Lender would have beenentitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower'sprior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.16 unless the Borroweris notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.16(e) as though itwere a Lender.

(d) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligationsof such Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to anysuch pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of itsobligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

SECTION 9.05. Survival. All covenants, agreements, representations and warranties made by the Parent, the Borrower or MF USA herein and inthe certificates or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the otherparties hereto and shall survive the execution and delivery of this Agreement and the making of any Loans, regardless of any investigation made by any suchother party or on its behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default or incorrectrepresentation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accruedinterest on any Loan or any fee or any other

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amount payable under this Agreement is outstanding and unpaid and so long as the Commitments have not expired or terminated. The provisions of Sections2.14, 2.15, 2.16 and 9.03 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions contemplatedhereby, the repayment of the Loans and the Commitments or the termination of this Agreement or any provision hereof.

SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by different parties hereto ondifferent counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement andany separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract among the parties relating to the subjectmatter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided inSection 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shallhave received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon andinure to the benefit of the parties hereto and their respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agreementby facsimile (or in any other manner approved pursuant to Section 9.01(b)) shall be effective as delivery of a manually executed counterpart of thisAgreement.

SECTION 9.07. Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to suchjurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of theremaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is herebyauthorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time ordemand, provisional or final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of theParent, the Borrower or MF USA against any of and all the obligations of the Borrower now or hereafter existing under this Agreement held by such Lender,irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be unmatured. The rights ofeach Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.

SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process. (a) This Agreement shall be construed in accordance with andgoverned by the law of the State of New York.

(b) Each party to this Agreement hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of theSupreme Court of the State of New York sitting in New York County and of the United States District Court of the Southern District of New York, and anyappellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, or for recognition or enforcement of any judgment,and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard anddetermined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in anysuch action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

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(c) Each party to this Agreement hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, anyobjection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any courtreferred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of aninconvenient forum to the maintenance of such action or proceeding in any such court.

(d) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01. Nothing in thisAgreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BYAPPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISINGOUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT,TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANYOTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OFLITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETOHAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONSIN THIS SECTION.

SECTION 9.11. Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not partof this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

SECTION 9.12. Confidentiality. (a) Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information(as defined below), except that Information may be disclosed (a) to its Affiliates and to its and their directors, officers, employees and agents, includingaccountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidentialnature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority or self-regulatoryauthority, (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement,(e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rightshereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or anyprospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) toany swap or derivative transaction relating to the Parent, the Borrower or MF USA and its obligations, (g) with the consent of the Parent, the Borrower or MFUSA or (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section or (ii) becomes available to theAdministrative Agent or any Lender on a nonconfidential basis from a source other than the Parent, the Borrower or MF USA. For the purposes of thisSection, "Information" means all information received from the Parent, the Borrower or MF USA relating to the Parent, the Borrower or MF USA or itsbusiness, other than any such information that is available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by theParent, the Borrower or MF USA; provided that, in the case of information received from the Parent, the Borrower or MF USA after the date hereof, suchinformation is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in thisSection shall be considered to have complied with its obligation to do so if such Person has exercised the

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same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

(b) EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.12(a) FURNISHED TO ITPURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION CONCERNING THE PARENT, THEBORROWER AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPEDCOMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLESUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW,INCLUDING FEDERAL AND STATE SECURITIES LAWS.

(c) ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE BORROWEROR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF ADMINISTERING, THIS AGREEMENT WILL BESYNDICATE-LEVEL INFORMATION, WHICH MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE BORROWERAND ITS RELATED PARTIES OR ITS SECURITIES. ACCORDINGLY, EACH LENDER REPRESENTS TO THE BORROWER AND THEADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAYRECEIVE INFORMATION THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITSCOMPLIANCE PROCEDURES AND APPLICABLE LAW.

SECTION 9.13. USA PATRIOT Act. Each Lender that is subject to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signedinto law October 26, 2001)) (the "Patriot Act") hereby notifies the Parent, the Borrower and MF USA that pursuant to the requirements of the Patriot Act, it isrequired to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and otherinformation that will allow such Lender to identify the Borrower in accordance with the Patriot Act.

SECTION 9.14. Releases of Guarantees and Liens. (a) Notwithstanding anything to the contrary contained herein or in any other LoanDocument, the Administrative Agent is hereby irrevocably authorized by each Lender (without requirement of notice to or consent of any Lender except asexpressly required by Section 9.02) to take any action requested by the Borrower having the effect of releasing any Collateral or guarantee obligations (i) tothe extent necessary to permit consummation of any transaction not prohibited by any Loan Document or that has been consented to in accordance withSection 9.02 or (ii) under the circumstances described in paragraph (b) below.

(b) At such time as the Loans and the other Obligations under the Loan Documents (other than obligations under or in respect of contingentindemnification obligations for which no claim has been made) shall have been paid in full and the Commitments have been terminated, the Collateral shall bereleased from the Liens created by the Security Agreement, and the Security Agreement and all obligations (other than those expressly stated to survive suchtermination) of the Administrative Agent and each Loan Party under the Loan Documents (including the Obligations) shall terminate, all without delivery ofany instrument or performance of any act by any Person.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective officers thereuntoduly authorized as of the date first written above. MF GLOBAL INC.,as Borrower

By:

Name: David Dunne Title: Treasurer

MF GLOBAL HOLDINGS LTD.,as the Parent

By:

Name: David Dunne Title: Treasurer and Senior Vice President

MF GLOBAL FINANCE USA INC.,as a Guarantor

By:

Name: David Dunne Title: Vice President

CREDIT AGREEMENT SIGNATURE PAGE

JPMORGAN CHASE BANK, N.A.,as a Lender and as Administrative Agent

By:

Name: Henry E. Steuart

Title:

Executive DirectorJP Morgan Chase Bank , N.A.


HARRIS, N.A.,as a Lender

By:

Name: Scott Ferris Title: Managing Director


BANK OF AMERICA, N.A.,as a Lender

BY:

Name: Maryanne Fitzmaurice Title: Director


CITIBANK, N.A.as a Lender

By:

Name: ALEX DUKA Title: MANAGING DIRECTOR


GOLDMAN SACHS BANK USA,as a Lender

By:

Name: Mark Walton Title: Authorized Signatory


DEUTSCHE BANK AG NEW YORK BRANCH,as a Lender

By:

Name: John S. McGill Title: Director

By:

Name: Virginia Cosenza Title: Vice President


THE BANK OF NEW YORK MELLON,as a Lender

By:

Name: Robert Motzel Title: Vice President


COMMONWEALTH BANK OF AUSTRALIA,as a Lender

By:

Name: PAUL T. CRCHART Title: GENERAL MANAGER EUROPE


STANDARD CHARTERED BANK,as a Lender

By:

Name: James P. Hughes A2386 Title: Director

By:

Name: Robert K. Reddington

Title:

Credit Documentation ManagerCredit Documentation Unit, WB Legal-Americas


U.S. BANK NATIONAL ASSOCIATION,as a Lender

By:

Name: Benjamin Berkowitz Title: Vice President


EXHIBIT A

FORM OFGUARANTY

[TO BE ATTACHED]

EXHIBIT B

FORM OFSECURITY AGREEMENT

[TO BE ATTACHED]

EXHIBIT C

[FORM OF OPINION OF SULLIVAN & CROMWELL LLP]

[TO BE ATTACHED]

EXHIBIT D-1

FORM OFCLOSING CERTIFICATE

Pursuant to Section 4.01(c) of the $300,000,000 364-Day Revolving Credit Facility, dated as of June 29, 2011 (the "Credit Agreement"; terms defined thereinbeing used herein as therein defined), among MF Global Inc. (the "Borrower"), MF Global Holdings Ltd. (the "Parent"), MF Global Finance USA Inc. ("MFUSA"), the Lenders party thereto, Harris N.A., Citigroup Global Markets Inc. and Bank of America, N.A., each as a Syndication Agent and JPMorgan ChaseBank, N.A., as administrative agent (in such capacity, the "Administrative Agent"), the undersigned [INSERT TITLE OF OFFICER] of the Borrower herebycertifies as follows as of the date hereof:

1. The representations and warranties of the Parent, the Borrower and MF USA in or pursuant to the Loan Documents or which are contained inany certificate furnished by or on behalf of the Parent, the Borrower and MF USA pursuant to any of the Loan Documents are true and correct on and as of thedate hereof with the same effect as if made on the date hereof, except for representations and warranties expressly stated to relate to a specific earlier date, inwhich case such representations and warranties were true and correct as of such earlier date.

2. No Default has occurred and is continuing as of the date hereof or after giving effect to the Loans to be made on the date hereof and the use ofproceeds thereof.

3. The conditions precedent set forth in Section 4.01 of the Credit Agreement were satisfied or waived on or prior to the Effective Date.

4. There are no liquidation or dissolution proceedings pending or to my knowledge threatened against the Parent, the Borrower or MF USA, norhas any other event occurred which materially and adversely affects or threatens the continued corporate existence of the Parent, the Borrower or MF USA.

5. Each of Parent, the Borrower and MF USA is a corporation duly incorporated, validly existing and in good standing under the laws of thejurisdiction of its organization.

IN WITNESS WHEREOF, the undersigned have hereunto set my name as of the date set forth below. Name:Title:

Date: , 200

EXHIBIT D-2

FORM OFSECRETARY'S CERTIFICATE

Pursuant to Section 4.01(c) of the $300,000,000 364-Day Revolving Credit Facility, dated as of June 29, 2011 (the "Credit Agreement"; terms defined thereinbeing used herein as therein defined), among MF Global Inc. (the "Borrower"), MF Global Holdings Ltd. (the "Parent"), MF Global Finance USA Inc. ("MFUSA"), the Lenders party thereto, Harris N.A., Citigroup Global Markets Inc. and Bank of America, N.A., each as a Syndication Agent and JPMorgan ChaseBank, N.A., as administrative agent (in such capacity, the "Administrative Agent"), the undersigned [INSERT TITLE OF OFFICER] of the Borrower herebycertifies as follows as of the date hereof:

1. [ ] is the duly elected and qualified [Corporate Secretary] of the Certifying Loan Party and the signature set forth for such officerbelow is such officer's true and genuine signature.

2. Attached hereto as Annex 1 is a true and complete copy of resolutions duly adopted by the [Board of Directors][OR ENTITY SPECIFICEQUIVALENT] of the Certifying Loan Party; such resolutions have not in any way been amended, modified, revoked or rescinded, have been in full forceand effect since their adoption to and including the date hereof and are now in full force and effect and are the only corporate proceedings of the CertifyingLoan Party now in force relating to or affecting the matters referred to therein.

3. Attached hereto as Annex 2 is a true and complete copy of the [By-Laws][OR ENTITY SPECIFIC EQUIVALENT] of the Certifying LoanParty as in effect on the date hereof.

4. Attached hereto as Annex 3 is a true and complete copy of the [Certificate of Incorporation][OR ENTITY SPECIFIC EQUIVALENT] of theCertifying Loan Party as in effect on the date hereof.

5. The following persons are now duly elected and qualified officers of the Certifying Loan Party holding the offices indicated next to theirrespective names below, and the signatures appearing opposite their respective names below are the true and genuine signatures of such officers, and each ofsuch officers is duly authorized to execute and deliver on behalf of the Certifying Loan Party each of the Loan Documents to which it is a party and anycertificate or other document to be delivered by the Certifying Loan Party pursuant to the Loan Documents to which it is a party: Name Office Signature

IN WITNESS WHEREOF, the undersigned have hereunto set my name as of the date set forth below.

Name:

Name:

Title: Title:Date: , 200

EXHIBIT E

FORM OF PLEDGED ELIGIBLE ASSETS NOTICE

JPMorgan Chase Bank, N.A.as Administrative Agent for theLenders party to the Credit Agreementreferred to below

270 Park Avenue, Floor 15New York, NY 10017Attention: Henry Steuart; Facsimile: (212) 270-4617

Copy to:

JPMorgan Chase Bank, N.A.c/o Loan & Agency Services500 Stanton Christiana RoadNewark, Delaware 19713Attn: Christina Sherlock; Facsimile (917)-464-9985

Date: , 20 .

Reference is made to the $300,000,000 364-Day Revolving Credit Facility, dated as of June 29, 2011 (the "Credit Agreement"), among MF Global Inc.(the "Borrower"), MF Global Holdings Ltd. (the "Parent"), MF Global Finance USA Inc. ("MF USA"), the Lenders party thereto, Harris N.A., CitigroupGlobal Markets Inc. and Bank of America, N.A., each as a Syndication Agent and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the"Administrative Agent"). Capitalized terms used herein and not defined herein shall have the meanings ascribed to them in the Credit Agreement or theSecurity Agreement, as applicable.

As security for the prompt and complete payment and performance when due (whether at stated maturity, by acceleration or otherwise) of allObligations or Customer Obligations (as each term is defined in the Security Agreement), as the case may be, the Borrower hereby pledges, assigns andtransfers to the Administrative Agent, and grants to the Administrative Agent, for the ratable benefit of the Lenders, a security interest in, any and all rights,title and interests of the Borrower in and to the Customer Pledged Eligible Assets or Firm Pledged Eligible Assets, as the case may be, described onAttachment 1 hereto.

The Borrower has taken all actions required under the Credit Agreement and the Security Agreement with respect to the Customer Pledged EligibleAssets or Firm Pledged Eligible Assets, as the case may be, described on Attachment 1, including taking such action as is required under DTC's rules andprocedures to direct DTC to Transfer to the Administrative Agent on its books (by reducing the Participant Account and increasing the Pledgee Account) theSecurity Entitlements with respect to such Customer Pledged Eligible Assets or Firm Pledged Eligible Assets, as the case may be.

Attachment 1

Description of Pledged Eligible Assets1

Sources, quantity and description of Pledged Eligible Assets:

Quantity

Type(Customer/Firm Pledged

Eligible Assets) Description CUSIP

EstimatedMarket

Value

Total: $ 1 Attachment 1 may be provided in the form of an Excel spreadsheet or such other form as the Administrative Agent may agree.

Regards

MF GLOBAL INC. By:

Name: Title:

EXHIBIT F

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the "Assignment and Assumption") is dated as of the Effective Date set forth below and is entered into by andbetween [Insert name of Assignor] (the "Assignor") and [Insert name of Assignee] (the "Assignee"). Capitalized terms used but not defined herein shall havethe meanings given to them in the Credit Agreement identified below (as amended, the "Credit Agreement"), receipt of a copy of which is herebyacknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein byreference and made a part of this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases andassumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date insertedby the Administrative Agent as contemplated below (i) all of the Assignor's rights and obligations in its capacity as a Lender under the Credit Agreement andany other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of suchoutstanding rights and obligations of the Assignor under the respective facilities identified below and (ii) to the extent permitted to be assigned underapplicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known orunknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactionsgoverned thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and allother claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assignedpursuant to clauses (i) and (ii) above being referred to herein collectively as the "Assigned Interest"). Such sale and assignment is without recourse to theAssignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.

1. Assignor: 2. Assignee:

and is an Affiliate/Approved Fund of [identify Lender]3 ]3. Borrower(s): MF Global Inc.4. Administrative Agent: JPMorgan Chase Bank, N.A., as the administrative agent under the Credit Agreement5.

Credit Agreement:

The $300,000,000 364-Day Revolving Credit Facility dated as of June 29, 2011 among the Borrower, MF Global Holdings Ltd.,MF Global Finance USA, the Lenders parties thereto, Harris N.A., Citigroup Global Markets Inc. and Bank of America, N.A.,each as a Syndication Agent and JPMorgan Chase Bank, N.A., as Administrative Agent.

3 Select as applicable.

6. Assigned Interest:

Aggregate Amount ofCommitment/Loans for

all Lenders

Amount of

Commitment/Loans

Assigned

Percentage Assigned ofCommitment/Loans

4

$ $ %$ $ %$ $ %

Effective Date: , 201 5

The Assignee agrees to deliver to the Administrative Agent a completed Administrative Questionnaire in which the Assignee designates one or more CreditContacts to whom all syndicate-level information (which may contain material non-public information about the Borrower and its Related Parties or theirrespective securities) will be made available and who may receive such information in accordance with the Assignee's compliance procedures and applicablelaws, including Federal and state securities laws.

The terms set forth in this Assignment and Assumption are hereby agreed to: ASSIGNOR[NAME OF ASSIGNOR]By:

Title:ASSIGNEE[NAME OF ASSIGNEE]By:

Title: 4 Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.

5 To be inserted by Administrative Agent and which shall be the Effective Date of recordation of transfer in the register therefor.

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[Consented to and]6 Accepted: JPMORGAN CHASE BANK, N.A., as Administrative AgentBy

Name:

Title: 6 To be added only if the consent of the Administrative Agent is required by the terms of the Credit Agreement.

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ANNEX 1

$300,000,000 364-DAY REVOLVING CREDIT FACILITY

STANDARD TERMS AND CONDITIONS FORASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1. Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the AssignedInterest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to executeand deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to(i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality,validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrower,any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Borrower,any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute anddeliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) itsatisfies the requirements, if any, specified in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest and becomea Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of theAssigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement, together with copies of the mostrecent financial statements delivered pursuant to Section 9.04 thereof, as applicable, and such other documents and information as it has deemed appropriateto make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it hasmade such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, and (v) if it is a Foreign Lender,attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, dulycompleted and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or anyother Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or nottaking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the LoanDocuments are required to be performed by it as a Lender.

2. Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (includingpayments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to theAssignee for amounts which have accrued from and after the Effective Date.

3. General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respectivesuccessors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument.Delivery of an executed counterpart of a signature page of this Assignment and Assumption by facsimile (or in any other manner approved pursuant toSection 9.01(b) of the Credit Agreement) shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. ThisAssignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York.

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Exhibit 10.2

SECURITY AGREEMENT

This Security Agreement (this "Agreement"), dated as of June 29, 2011, is entered into by and among MF Global Inc. (the "Borrower") and JPMorganChase Bank, N.A., as administrative agent (the "Administrative Agent") for the ratable benefit of the Administrative Agent and the Lenders under that certain364-Day Revolving Credit Agreement, dated as of the date hereof, among the Borrower, MF Global Holdings Ltd. and MF Global Finance USA Inc. asGuarantors, Harris, N.A. and Citigroup Global Markets Inc, each as a Syndication Agent, the Administrative Agent and the other agents and Lenders fromtime to time party thereto (as amended, supplemented or otherwise modified from time to time, the "Credit Agreement") and JPMorgan Chase Bank, N.A. assecurities intermediary for the Collateral Accounts (as defined below) (in such capacity, the "Account Bank").

W I T N E S S E T H:

WHEREAS, the Borrower, the Lenders, the Administrative Agent and the other agents party thereto have entered into the Credit Agreement, pursuantto which the Lenders have agreed to make Loans to the Borrower, subject to the terms and conditions of the Credit Agreement; and

WHEREAS, it is a condition precedent to the obligation of the Lenders to make Loans to the Borrower under the Credit Agreement that the Borrowershall have executed and delivered this Agreement to the Administrative Agent for the ratable benefit of the Administrative Agent and the Lenders;

NOW THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which areacknowledged, the Borrower hereby agrees as follows:

Section 1. Definitions. Capitalized terms that are used herein and are not defined herein shall have the meanings ascribed to them in the CreditAgreement. In addition to the terms defined elsewhere in this Agreement, the following terms shall have the following meanings:

"Collateral" has the meaning assigned to such term in Section 3(b).

"Customer Collateral" has the meaning assigned to such term in Section 3(a).

"Customer Collateral Account" means a Securities Account (account number [ ]) established and maintained by the Administrative Agentas a Security Intermediary as a collateral account for the purpose of pledging Customer Pledged Eligible Assets in connection with the CreditAgreement and this Agreement.

"Collateral Accounts" means each of the Customer Collateral Account and the Firm Collateral Account.

"Control" means "control" as defined in the UCC for the relevant type of property.

"Customer Obligations" mean all Obligations related to the Customer Loans.

"Entitlement Order" means an "entitlement order" as defined in the UCC.

"Firm Collateral" has the meaning assigned to such term in Section 3(b).

"Firm Collateral Account" means a Securities Account (account number [ ]) established and maintained by the Administrative Agent as aSecurity Intermediary as a collateral account for the purpose of pledging Firm Pledged Eligible Assets in connection with the Credit Agreement and thisAgreement.

"Obligations": the collective reference to the unpaid principal of and interest on the Loans and all other obligations and liabilities of the Borrower(including, without limitation, interest accruing at the then applicable rate provided in the Credit Agreement after the maturity of the Loans and interestaccruing at the then applicable rate provided in the Credit Agreement after the filing of any petition in bankruptcy, or the commencement of anyinsolvency, reorganization or like proceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in suchproceeding) to the Administrative Agent or any Lender, whether direct or indirect, absolute or contingent, due or to become due, or now existing orhereafter incurred, which may arise under, out of, or in connection with, the Credit Agreement, this Agreement, the other Loan Documents, or any otherdocument made, delivered or given in connection with any of the foregoing, in each case whether on account of principal, interest, reimbursementobligations, fees, indemnities, costs, expenses or otherwise (including, without limitation, all fees and disbursements of counsel to the AdministrativeAgent or to the Lenders that are required to be paid by the Borrower pursuant to the terms of any of the foregoing agreements).

"Participant Account" means an account maintained by DTC as a Securities Intermediary for the Borrower to which Securities transactions of theBorrower effected through the facilities of DTC are debited and credited in the manner specified in the rules and procedures of DTC.

"Permitted Liens" means (a) Liens securing the payment of taxes not yet due, (b) other Liens which arise by operation of law, and not as a resultof any default and liens securing the payment of taxes (provided that, in each case, such Liens do not materially interfere with the Borrower's use of thePledged Eligible Assets, lessen the value of the Pledged Eligible Assets as Collateral in a manner that causes a Deficiency or impair the Lien held bythe Administrative Agent, for the ratable benefit of the Administrative Agent and the Lenders, in the Pledged Eligible Assets) and (c) Liens in favor ofthe Administrative Agent, for the ratable benefit of the Administrative Agent and the Lenders.

"Pledgee Account" means a pledgee account maintained by DTC as a Securities Intermediary for the Administrative Agent to which Securitiestransactions of the Administrative Agent effected through the facilities of DTC are debited and credited in the manner specified in the rules andprocedures of DTC.

"Redesignation Event" means any day for which a Deficiency exists and the aggregate Loan Value of the Pledged Eligible Assets equals orexceeds the total Revolving Credit Exposure but there is either a Customer Deficiency or a Firm Deficiency, in each case, as of such preceding BusinessDay.

"Release" has the meaning as defined in Section 5 of this Agreement.

"Securities Account" means a "securities account" as defined in the UCC.

"Securities Intermediary" means a "securities intermediary" as defined in the UCC.

"Security" means "financial asset" as defined in Section 8-102 of the UCC.

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"Security Entitlement" means a "security entitlement" as defined in the UCC.

"Transfer" means, in the case of a Security Entitlement, including without limitation, a Security Entitlement with respect to Pledged EligibleAssets, a Securities Intermediary indicating by book entry that such Security Entitlement has been credited to the transferee's Securities Account.

"UCC" shall mean the Uniform Commercial Code as from time to time in effect in the State of New York.

Section 2. Representations and Warranties of the Borrower. The Borrower represents and warrants to the Administrative Agent and each Lender asfollows:

(a) At the time of delivery by the Borrower of any Pledged Eligible Assets Notice as described in Section 3 of this Agreement, and at the time ofdelivery by it of any other Securities (including Security Entitlements) to the Pledgee Account, the Customer Collateral Account or the Firm CollateralAccount, as the case may be, the Borrower will have the right to pledge, assign and transfer to the Administrative Agent, and to grant to theAdministrative Agent, for the ratable benefit of the Administrative Agent and the Lenders, a security interest in the Pledged Eligible Assets referred totherein or such other Securities (including Security Entitlements).

(b) Upon:

(i) the satisfaction by the Borrower of the requirements of Section 3 of this Agreement; and

(ii) the Transfer by DTC debiting the Participant Account for, and crediting to the Pledgee Account, Security Entitlements identified in aPledged Eligible Assets Notice as Firm Pledged Eligible Assets owned by the Borrower or within its control to pledge hereunder, resulting in theAdministrative Agent having Control of such Security Entitlements pursuant to Section 8-106(d)(1) of the UCC,

the Administrative Agent will have, for the ratable benefit of the Lenders, a valid first priority perfected security interest in such Security Entitlementssecuring payment and performance of the Obligations, which security interest will be free of adverse claims (other than Permitted Liens).

(c) Upon:


(ii) the Transfer by DTC debiting the Participant Account for, and crediting to the Pledgee Account, Security Entitlements identified in aPledged Eligible Assets Notice as Customer Pledged Eligible Assets owned by the Borrower or within its control to pledge hereunder, resultingin the Administrative Agent having Control of such Security Entitlements pursuant to Section 8-106(d)(1) of the UCC,

the Administrative Agent will have, for the ratable benefit of the Lenders, a valid first priority perfected security interest in such Security Entitlementssecuring payment and performance of the Customer Obligations, which security interest will be free of adverse claims (other than Permitted Liens).

3

(d) Upon:


(ii) the Transfer by the Borrower to the Firm Collateral Account of Securities (including Security Entitlements) identified in a PledgedEligible Assets Notice as Firm Pledged Eligible Assets owned by the Borrower or within its control to pledge hereunder,

the Administrative Agent will have, for the ratable benefit of the Lenders, a valid first priority perfected security interest in such Securities (includingSecurity Entitlements) securing payment and performance of the Obligations, which security interest will be free of adverse claims (other thanPermitted Liens).

(e) Upon:


(ii) the Transfer by the Borrower to the Customer Collateral Account of Securities (including Security Entitlements) identified in a PledgedEligible Assets Notice as Customer Pledged Eligible Assets owned by the Borrower or within its control to pledge hereunder,

the Administrative Agent will have, for the ratable benefit of the Lenders, a valid first priority perfected security interest in such Securities (includingSecurity Entitlements) securing payment and performance of the Customer Obligations, which security interest will be free of adverse claims (otherthan Permitted Liens).

(f) All information set forth in each Pledged Eligible Assets Notice will be true and correct in all material respects as of the date of delivery to theAdministrative Agent of such Pledged Eligible Assets Notice.

Section 3. Pledge; Perfection of Lien. (a) As security for the prompt and complete payment and performance when due (whether at stated maturity, byacceleration or otherwise) of all Customer Obligations, the Borrower hereby pledges, assigns and transfers to the Administrative Agent, and grants to theAdministrative Agent, for the ratable benefit of the Administrative Agent and the Lenders, a security interest in any and all rights, title and interests of theBorrower from time to time in and to all Securities identified in a Pledged Eligible Assets Notice as Customer Pledged Eligible Assets (including SecurityEntitlements) from time to time credited at the direction of the Borrower to the Pledgee Account or Transferred to the Customer Collateral Account and notreleased therefrom pursuant to Section 4 or Section 5, and any Securities (including Security Entitlements) or cash received in exchange therefor or onaccount of payments thereon while such Securities (including Security Entitlements) are held in the Pledgee Account or the Customer Collateral Account orotherwise by the Administrative Agent pursuant to Section 7 (the foregoing, collectively, the "Customer Collateral").

(b) As security for the prompt and complete payment and performance when due (whether at stated maturity, by acceleration or otherwise) of allObligations, the Borrower hereby pledges, assigns and transfers to the Administrative Agent, and grants to the Administrative Agent, for the ratable benefit ofthe Administrative Agent and the Lenders, a security interest in any and all rights, title and interests of the

4

Borrower from time to time in and to all Securities (other than any identified in a Pledged Eligible Assets Notice as Customer Pledged Eligible Assets andincluding Security Entitlements) from time to time credited at the direction of the Borrower to the Pledgee Account or Transferred to the Firm CollateralAccount and not released therefrom pursuant to Section 4 or Section 5, and any Securities (including Security Entitlements) or cash received in exchangetherefor or on account of payments thereon while such Securities (including Security Entitlements) are held in the Pledgee Account or the Firm CollateralAccount or otherwise by the Administrative Agent pursuant to Section 7 (the foregoing, collectively, the "Firm Collateral", and together with the CustomerCollateral, the "Collateral").

(c) In order to perfect the security interest of the Administrative Agent therein, the Borrower shall, prior to or concurrently with the delivery of eachPledged Eligible Assets Notice:

(i) take such action as is required under DTC's rules and procedures to direct DTC to Transfer to the Administrative Agent on its books (bydebiting the Participant Account and crediting the Pledgee Account) the Security Entitlements with respect to the Eligible Assets referred to insuch Pledged Eligible Assets Notice (or such other Securities (including Security Entitlements) in lieu thereof or in addition thereto as theBorrower may determine), such that the Administrative Agent shall have Control of such Security Entitlements pursuant to Section 8-106(d)(1)of the UCC; or

(ii) transfer or caused to be Transferred to the Customer Collateral Account or the Firm Collateral Account, as the case may be, theSecurity Entitlements with respect to the Eligible Assets referred to in such Pledged Eligible Assets Notice (or such other Securities (includingSecurity Entitlements) in lieu thereof or in addition thereto as the Borrower may determine).

Section 4. Disposition of Pledged Eligible Assets When No Loans Are Outstanding. (a) At any time when there are no Customer Loans outstanding(either because no Customer Loans have been made to the Borrower or any Customer Loans that have been made to the Borrower have been repaid in full)and no other Customer Obligations that are then due and payable are unpaid, at the sole cost and expense of the Borrower, the Administrative Agent shallfrom time to time Transfer to the Borrower (or cause to be Transferred by taking such action as is required under DTC's rules and procedures to cause DTC toTransfer to the Borrower on its books by debiting the Pledgee Account and crediting the Participant Account) within one hour of any such request by theBorrower, all or such portion of Securities identified in a Pledged Eligible Assets Notice as Customer Pledged Eligible Assets (including SecurityEntitlements) then subject to the Control of the Administrative Agent or in the Customer Collateral Account as shall be requested by the Borrower, and uponsuch Transfer the Administrative Agent's security interests in such Securities (including Security Entitlements) shall automatically terminate and be releasedwithout any further action by any other Person.

(b) At any time when there are no Loans outstanding (either because no Loans have been made to the Borrower or any Loans that have been made tothe Borrower have been repaid in full) and no other Obligations that are then due and payable are unpaid, at the sole cost and expense of the Borrower, theAdministrative Agent shall from time to time Transfer to the Borrower (or cause to be Transferred by taking such action as is required under DTC's rules andprocedures to cause DTC to Transfer to the Borrower on its books by debiting the Pledgee Account and crediting the Participant Account) within one hour ofany such request by the Borrower, all or such portion of Securities (including Security Entitlements) then subject to the Control of the Administrative Agentor in the Customer Collateral Account or the Firm Collateral Account, as the case may be, as shall be requested by the Borrower, and upon such Transfer theAdministrative Agent's security interests in such Securities (including Security

5

Entitlements) shall automatically terminate and be released without any further action by any other Person.

Section 5. Release of Pledged Eligible Assets When Loans are Outstanding and No Event of Default Shall Have Occurred and be Continuing. (a) Atany time when there are Customer Loans outstanding, but no Event of Default shall have occurred and be continuing, at the request of the Borrower (suchrequest a "Customer Release Request"), the Administrative Agent shall Transfer and release to the Borrower at the sole cost and expense of the Borrower (orcause to be Transferred by taking such action as is required under DTC's rules and procedures to cause DTC to Transfer and release to the Borrower or suchother Person or Persons on its books by debiting the Pledgee Account and crediting the Participant Account) (such release, in either case, a "CustomerRelease") within one hour of any such Customer Release Request by the Borrower such portion of the Securities identified in a Pledged Eligible Assets Noticeas Customer Pledged Eligible Assets (including Security Entitlements) then subject to the Control of the Administrative Agent or in the Customer CollateralAccount as shall be requested by the Borrower and the Administrative Agent shall make such Customer Release so long as no Customer Deficiency wouldexist after giving effect to such Customer Release, and, upon such Customer Release, the Administrative Agent's security interests in such Securities (andSecurity Entitlements) shall terminate and be released.

(b) At any time when there are Loans outstanding, but no Event of Default shall have occurred and be continuing, at the request of the Borrower (suchrequest a "Firm Release Request"), the Administrative Agent shall Transfer and release to the Borrower, at the sole cost and expense of the Borrower (orcause to be Transferred by taking such action as is required under DTC's rules and procedures to cause DTC to Transfer and release to the Borrower or suchother Person or Persons on its books by debiting the Pledgee Account and crediting the Participant Account) (such release a "Firm Release") within one hourof any such Firm Release Request by the Borrower such portion of the Securities (other than any identified in a Pledged Eligible Assets Notice as CustomerPledged Eligible Assets and including Security Entitlements) then subject to the Control of the Administrative Agent or in the Firm Collateral Account asshall be requested by the Borrower and the Administrative Agent shall make such Firm Release so long as no Firm Deficiency would exist after giving effectto such Firm Release, and, upon such Firm Release, the Administrative Agent's security interests in such Securities (and Security Entitlements) shall terminateand be released.

Section 6. Redesignation of Customer Loans. During (i) any Business Day on which it has received notice that a Redesignation Event has occurred or(ii) any other Business Day on which unpaid Obligations remain outstanding, the Borrower may, in each case, deliver to the Administrative Agent a noticepursuant to which the Borrower may (A) in the case of a redesignation pursuant to clause (i) above (after giving effect to any transfer of additional PledgedEligible Assets by such Pledgor pursuant to Section 3 on such day or any repayment of Loans pursuant to Section 2.08 of the Credit Agreement on such day),redesignate one or more Loans (or portions thereof) which, as of such day, are designated as being secured by Pledged Eligible Assets for which a Deficiencyexists on such day so that, after giving effect to the redesignations indicated in such Notice, such Pledgor shall be in compliance with respect to Section 6.08of the Credit Agreement and (B) in the case of a redesignation pursuant to clause (ii) above, redesignate one or more Loans (or portions thereof) of suchPledgor as being secured by the other Pledged Eligible Assets of such Pledgor so long as, following the redesignation indicated in such notice, such Pledgorshall be in compliance with Section 6.08 of the Credit Agreement on such day; provided that all such redesignations pursuant to this Section 6 shall be incompliance with applicable laws and regulations.

Section 7. Further Assurances. The Borrower agrees that at any time and from time to time, at the sole cost and expense of the Borrower, theBorrower will promptly execute and deliver all further

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instruments and documents, and take all further action, that may be necessary or desirable, or that the Administrative Agent may request, in order to perfectand protect any security interest granted by the Borrower to the Administrative Agent for the ratable benefit of the Administrative Agent and the Lendersunder this Agreement or to enable the Administrative Agent to exercise and enforce its rights and remedies with respect to any Securities (including SecurityEntitlements) pledged under this Agreement.

Section 8. Remedies Upon Default; Rights Under UCC.

(a) Upon the occurrence of any Event of Default and at any time thereafter, if an Event of Default shall then be continuing and any Obligationsshall then be outstanding and due and payable, the Administrative Agent may, subject to applicable law and the requirements of the Credit Agreement,with respect to any Securities (including Security Entitlements) or other Collateral delivered to the Administrative Agent pursuant to Section 3 that havenot been previously released pursuant to Section 4 or 5 of this Agreement:

(i) direct DTC to Transfer such Securities (including Security Entitlements) or other Collateral from the Pledgee Account to the omnibusaccount of the Administrative Agent or its nominee; and/or

(ii) Transfer such Securities (including Security Entitlements) or other Collateral from the Customer Collateral Account or the FirmCollateral Account, as the case may be, to the omnibus account of the Administrative Agent or its nominee; and/or

(iii) sell or order the sale of all or any part of such Securities (including Security Entitlements) or other Collateral in any market and at anyprice deemed by the Administrative Agent to be fair and reasonable in the circumstances.

(b) The rights and remedies herein provided are cumulative, may be exercised singly or concurrently and, in addition to the rights and remediesprovided for in this Agreement, the Borrower agrees that the Administrative Agent shall be entitled to exercise all of the rights and remedies availableto a secured party under the UCC or under any other applicable law. Without limiting the generality of the foregoing, the Administrative Agent, withoutdemand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law referred tobelow) to or upon the Borrower or any other Person (all and each of which demands, defenses, advertisements and notices are hereby waived), mayupon the occurrence and during the continuance of an Event of Default, forthwith collect, receive, appropriate and realize upon the Collateral, or anypart thereof, and/or may forthwith sell, lease, assign, give option or options to purchase, or otherwise dispose of and deliver the Collateral or any partthereof (or contract to do any of the foregoing), in one or more parcels at public or private sale or sales, at any exchange, broker's board or office of theAdministrative Agent or any Lender or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, forcash or on credit or for future delivery without assumption of any credit risk. The Administrative Agent or any Lender shall have the right upon anysuch public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Collateral sosold, free of any right or equity of redemption by the Borrower, which right or equity is hereby waived and released. To the extent permitted byapplicable law, the Borrower waives all claims, damages and demands it may acquire against the Administrative Agent or any Lender arising out of theexercise by them of any rights hereunder.

Section 9. Deficiency. The Borrower shall remain liable for any deficiency if the proceeds of any application, sale or other disposition of anyCollateral are insufficient to pay the Obligations

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secured thereby and the reasonable fees and disbursements of any attorneys employed by the Administrative Agent or any Lender to collect such deficiency(with regard to fees and disbursements of any attorneys, to the extent the Borrower is required to pay or reimburse such fees and disbursements pursuant toSection 9.03 of the Credit Agreement).

Section 10. Application of Proceeds. The Administrative Agent shall apply the net proceeds of any collection, recovery, receipt, appropriation,realization or sale or any other action taken by it in respect of the Collateral pursuant to Section 7, after deducting all costs and expenses of every kindincurred therein or incidental to the care or safekeeping or otherwise of any or all of the Collateral or in any way relating to the rights of the AdministrativeAgent and the Lenders under this Agreement, including, without limitation, the expenses and reasonable fees of the Administrative Agent's counsel, to thepayment in whole or in part of the Obligations or the Customer Obligations, as the case may be, in the following order:

First, to pay incurred and unpaid fees and expenses of the Administrative Agent under the Loan Documents and included in the Obligations or theCustomer Obligations, as the case may be (as reasonably determined by the Administrative Agent);

Second, to the Administrative Agent for application by it towards payment of amounts then due and owing and remaining unpaid in respect of theObligations or the Customer Obligations, as the case may be, pro rata among the Lenders according to the amounts of the Obligations or the CustomerObligations, as the case may be, then due and owing and remaining unpaid to the Lenders; and

Third, any balance remaining after the Obligations or the Customer Obligations, as the case may be, shall have been paid in full and theCommitments shall have terminated and after the payment by the Administrative Agent of any other amount required by any provision of law, thesurplus, if any, shall be paid over to the Borrower or to whomsoever may be lawfully entitled to receive the same.

Section 11. The Administrative Agent.

(a) Administrative Agent's Appointment as Attorney-in-Fact, etc.

(i) The Borrower hereby irrevocably constitutes and appoints the Administrative Agent and any officer or agent thereof, with full power ofsubstitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of the Borrower and in thename of the Borrower or in its own name, for the purpose of carrying out the terms of this Agreement, after the occurrence and during thecontinuance of an Event of Default, to take any and all appropriate action and to execute any and all documents and instruments which may benecessary or desirable to accomplish the purposes of this Agreement.

(ii) If the Borrower fails to perform or comply with any of its agreements contained herein, after the occurrence and during the continuanceof an Event of Default, the Administrative Agent, at its option, but without any obligation so to do, may perform or comply, or otherwise causeperformance or compliance, with such agreement.

(iii) The Borrower hereby irrevocably authorizes the Administrative Agent to file or record financing statements and other filing orrecording documents or instruments with respect to the Collateral without the signature of the Borrower in such form and in

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such offices as the Administrative Agent determines is appropriate to perfect the security interests of the Administrative Agent on behalf ofLenders under this Agreement or any other Loan Document.

(iv) The Borrower hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof. All powers, authorizationsand agencies contained in this Agreement are coupled with an interest and are irrevocable until this Agreement is terminated and the securityinterests created hereby are released.

(b) Duty of Administrative Agent. The Administrative Agent's sole duty with respect to the custody, safekeeping and physical preservation of theCollateral in its possession shall be to deal with it in the same manner as the Administrative Agent deals with similar property for its own account.Neither the Administrative Agent, any Lender nor any of their respective officers, directors, employees or agents shall be liable for failure to demand,collect or realize upon any of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateralupon the request of the Borrower or any other Person or to take any other action whatsoever with regard to the Collateral or any part thereof, except asotherwise set forth herein. The powers conferred on the Administrative Agent hereunder are solely to protect the Administrative Agent's interests in theCollateral and shall not impose any duty upon the Administrative Agent to exercise any such powers. The Administrative Agent shall be accountableonly for amounts that it actually receives as a result of the exercise of such powers, and neither it nor any of its officers, directors, employees or agentsshall be responsible to the Borrower for any act or failure to act hereunder, except for its own (or its officers', directors', employees' or agents') grossnegligence or willful misconduct.

(c) Agreement to Appoint Agent for Holding Pledged Eligible Assets. If the Administrative Agent shall cease to be a participant of DTC at anytime during the term of the Credit Agreement, the Administrative Agent will promptly enter into a written agreement with a DTC participant selectedby the Administrative Agent (which may be an affiliate of the Administrative Agent) pursuant to which such DTC participant will agree to act as theAdministrative Agent's agent for the purpose of holding the Security Entitlements in such DTC participant's pledgee account with DTC, and theAdministrative Agent will maintain such agreement (or a similar agreement with another DTC participant selected by the Administrative Agent) solong as the Credit Agreement remains in effect.

Section 12. Amendments, Waivers and Consents. None of the terms or provisions of this Agreement may be waived, amended, supplemented orotherwise modified except in accordance with Section 9.02 of the Credit Agreement. No failure on the part of the Administrative Agent to exercise, and nodelay in exercising any right, power or remedy under this Agreement shall operate as a waiver of such right, power or remedy, nor shall any single or partialexercise of any such right, power or remedy by the Administrative Agent preclude any other or further exercise thereof or the exercise of any other right,power or remedy.

Section 13. Successors and Assigns. This Agreement shall be binding upon the Borrower and its successors and assigns, and shall inure to the benefitof the Administrative Agent and the Lenders and their successors and assigns; provided, however, that the Borrower may not assign any of its rights orobligations hereunder without the prior written consent of the Administrative Agent.

Section 14. Notices. All notices and other communications provided for under this Agreement shall be effective if given in accordance withSection 9.01 of the Credit Agreement.

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Section 15. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED INACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. REGARDLESS OF ANY PROVISION IN ANY OTHER AGREEMENT,FOR PURPOSES OF THE UCC, NEW YORK SHALL BE DEEMED TO BE JPMORGAN CHASE BANK, N.A.'S JURISDICTION (INCLUDINGIN ITS CAPACITY AS ACCOUNT BANK).

Section 16. Termination. Subject to the provisions of Section 17 of this Agreement, this Agreement shall automatically terminate and the securityinterests created hereby shall automatically terminate and be released when all the Obligations have been fully paid and performed (other than contingentindemnification obligations for which no claim has been made) and the Commitments under the Credit Agreement have been terminated, at which time theAdministrative Agent shall reassign (or cause to be reassigned) to the Borrower (at the Borrower's sole cost and expense), or to such person or persons as theBorrower shall designate, such of the Collateral (if any) as shall not have been sold or otherwise applied by the Administrative Agent pursuant to the terms ofthis Agreement and shall still be held under this Agreement, together with appropriate instruments of reassignment and release that may be reasonablyrequested by the Borrower.

Section 17. Payments Set Aside. Notwithstanding the provisions of Section 16 of this Agreement, to the extent that the Borrower makes a payment orpayments to the Administrative Agent or the Administrative Agent or any Lender enforces its security interests or exercises its right of setoff under the LoanDocuments, and such payment or payments or the proceeds of such enforcement or setoff or any part of such payment or payments or proceeds aresubsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under anybankruptcy law, state or federal law, common law or equitable cause, then to the extent of such recovery, the Obligation or part of such Obligation originallyintended to be satisfied shall be revived (and the Borrower shall cause to be pledged to the Administrative Agent, for the ratable benefit of the AdministrativeAgent and the Lenders, additional Collateral in an amount sufficient to secure such Obligation, to the extent necessary in the Administrative Agent's solejudgment) and continue in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

Section 18. Interpretation; Partial Invalidity. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to beeffective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under such law, such provision shall beineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of thisAgreement.

Section 19. Counterparts. This Agreement may be executed in any number of counterparts (including by telecopy or via electronic mail) and by eachof the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and both of which taken together shallconstitute one and the same agreement.

Section 20. Section Headings. The section headings used in this Agreement are for convenience of reference only and shall not define or limit theprovisions of this Agreement.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the parties hereto have executed this Security Agreement by their duly authorized officers as of the day and year firstabove written.

MF GLOBAL INC.By: /s/ David Dunne

Name: Title:

[MF Global – Signature Page to Security Agreement]

ACCEPTED: JPMORGAN CHASE BANK, N.A.,individually, as Account Bank and as Administrative AgentBy: /s/ Henry E. Steuart

Name: Title:

[MF Global – Signature Page to Security Agreement]

Exhibit 10.3

GUARANTY

This GUARANTY, dated as of June 29, 2011, is made by each of the signatories hereto (the "Guarantors"), in favor of JPMORGAN CHASE BANK,N.A., as Administrative Agent (in such capacity, the "Administrative Agent") for the banks and other financial institutions or entities (the "Lenders") fromtime to time parties to the 364-Day Revolving Credit Agreement, dated as of June [ ], 2011 (as amended, supplemented or otherwise modified from time totime, the "Credit Agreement"), among MF Global Inc. (the "Borrower"), MF Global Holdings Ltd., MF Global Finance USA Inc., the Lenders and theAdministrative Agent.

W I T N E S S E T H:

WHEREAS, pursuant to the Credit Agreement, the Lenders have severally agreed to make Loans to the Borrower upon the terms and subject to theconditions set forth therein;

WHEREAS, the Borrower is a member of an affiliated group of companies that includes each Guarantor;

WHEREAS, the Borrower and the Guarantors are engaged in related businesses, and each Guarantor will derive substantial direct and indirect benefitfrom the making of the Loans under the Credit Agreement; and

WHEREAS, it is a condition precedent to the obligation of the Lenders to make the Loans to the Borrower under the Credit Agreement that theGuarantors shall have executed and delivered this Agreement to the Administrative Agent for the ratable benefit of the Lenders;

NOW, THEREFORE, in consideration of the premises and to induce the Administrative Agent and the Lenders to enter into the Credit Agreement andto induce the Lenders to make Loans to the Borrower thereunder, each Guarantor hereby agrees with the Administrative Agent, for the ratable benefit of theLenders, as follows:

SECTION 1. DEFINED TERMS

1.1 Definitions

(a) Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the CreditAgreement.

The following terms shall have the following meanings:

"Agreement": this Guaranty, as the same may be amended, supplemented or otherwise modified from time to time.

"Obligations": the collective reference to the unpaid principal of and interest on the Loans and all other obligations and liabilities of the Borrower(including, without limitation, interest accruing at the then applicable rate provided in the Credit Agreement after the maturity of the Loans and interestaccruing at the then applicable rate provided in the Credit Agreement after the filing of any petition in bankruptcy, or the commencement of any insolvency,reorganization or like proceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) to theAdministrative Agent or any Lender, whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, whichmay arise under, out of, or in

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connection with, the Credit Agreement, this Agreement, the other Loan Documents, or any other document made, delivered or given in connection with anyof the foregoing, in each case whether on account of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses or otherwise (including,without limitation, all fees and disbursements of counsel to the Administrative Agent or to the Lenders that are required to be paid by the Borrower pursuantto the terms of any of the foregoing agreements).

1.2 Other Definitional Provisions

(a) The words "hereof," "herein", "hereto" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as awhole and not to any particular provision of this Agreement, and Section and Schedule references are to this Agreement unless otherwise specified.

(b) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

SECTION 2. GUARANTY

2.1 Guaranty

(a) Each of the Guarantors hereby, jointly and severally, unconditionally and irrevocably, guarantees to the Administrative Agent, for the ratable benefitof the Lenders and their respective successors, indorsees, transferees and assigns, the prompt and complete payment and performance when due (whether atthe stated maturity, by acceleration or otherwise) of the Obligations owing from time to time by any and each Person other than such Guarantor.

(b) Anything herein or in any other Loan Document to the contrary notwithstanding, the maximum liability of each Guarantor hereunder shall in noevent exceed the amount which can be guaranteed by such Guarantor under applicable federal and state laws relating to the insolvency of debtors (after givingeffect to the right of contribution established in Section 2.2).

(c) Each Guarantor agrees that the Obligations may at any time and from time to time exceed the amount of the liability of such Guarantor hereunderwithout impairing the guarantee contained in this Section 2 or affecting the rights and remedies of the Administrative Agent or any Lender hereunder.

(d) The guarantee contained in this Section 2 shall remain in full force and effect until all the Obligations and the obligations of each Guarantor underthe guarantee contained in this Section 2 shall have been satisfied by payment in full and the Commitments shall be terminated, notwithstanding that fromtime to time during the term of the Credit Agreement the Borrower may be free from any Obligations.

(e) No payment made by the Borrower or any Guarantor, any other guarantor or any other Person or received or collected by the Administrative Agentor any Lender by virtue of any action or proceeding or any set-off or appropriation or application at any time or from time to time in reduction of or inpayment of the Obligations shall be deemed to modify, reduce, release or otherwise affect the liability of any Guarantor hereunder which shall,notwithstanding any such payment (other than any payment made by such Guarantor in respect of the Obligations or any payment received or collected fromsuch Guarantor in respect of the Obligations), remain liable for the Obligations up to the maximum liability of such Guarantor hereunder until the Obligationsare paid in full and the Commitments are terminated.

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2.2 Right of Contribution

Each Guarantor hereby agrees that to the extent that a Guarantor shall have paid more than its proportionate share of any payment made hereunder, suchGuarantor shall be entitled to seek and receive contribution from and against any other Guarantor hereunder which has not paid its proportionate share of suchpayment. Each Guarantor's right of contribution shall be subject to the terms and conditions of Section 2.3. The provisions of this Section 2.2 shall in norespect limit the obligations and liabilities of any Guarantor to the Administrative Agent and the Lenders, and each Guarantor shall remain liable to theAdministrative Agent and the Lenders for the full amount guaranteed by such Guarantor hereunder.

2.3 No Subrogation

Notwithstanding any payment made by any Guarantor hereunder or any set-off or application of funds of any Guarantor by the Administrative Agent orany Lender, no Guarantor shall be entitled to be subrogated to any of the rights of the Administrative Agent or any Lender against the Borrower or any otherGuarantor or guarantee or right of offset held by the Administrative Agent or any Lender for the payment of the Obligations, nor shall any Guarantor seek orbe entitled to seek any contribution or reimbursement from the Borrower or any other Guarantor in respect of payments made by such Guarantor hereunder,until all amounts owing to the Administrative Agent and the Lenders by the Borrower on account of the Obligations are paid in full and the Commitments areterminated. If any amount shall be paid to any Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have beenpaid in full, such amount shall be held by such Guarantor in trust for the Administrative Agent and the Lenders, segregated from other funds of suchGuarantor, and shall, forthwith upon receipt by such Guarantor, be turned over to the Administrative Agent in the exact form received by such Guarantor(duly indorsed by such Guarantor to the Administrative Agent, if required), to be applied against the Obligations, whether matured or unmatured, in suchorder as the Administrative Agent may determine.

2.4 Amendments, etc. with respect to the Obligations

Each Guarantor shall remain obligated hereunder notwithstanding that, without any reservation of rights against any Guarantor and without notice to orfurther assent by any Guarantor, any demand for payment of any of the Obligations made by the Administrative Agent or any Lender may be rescinded by theAdministrative Agent or such Lender and any of the Obligations continued, and the Obligations, or the liability of any other Person upon or for any partthereof, or any guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, amended,modified, accelerated, compromised, waived, surrendered or released by the Administrative Agent or any Lender, and the Credit Agreement and the otherLoan Documents and any other documents executed and delivered in connection therewith may be amended, modified, supplemented or terminated, in wholeor in part, as the Administrative Agent (or the Required Lenders or all Lenders, as the case may be) may deem advisable from time to time, and any guaranteeor right of offset at any time held by the Administrative Agent or any Lender for the payment of the Obligations may be sold, exchanged, waived, surrenderedor released.

2.5 Guaranty Absolute and Unconditional

Each Guarantor waives any and all notice of the creation, renewal, extension or accrual of any of the Obligations and notice of or proof of reliance bythe Administrative Agent or any Lender upon the guarantee contained in this Section 2 or acceptance of the guarantee contained in this Section 2; theObligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred,

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or renewed, extended, amended or waived, in reliance upon the guarantee contained in this Section 2; and all dealings between the Borrower and any of theGuarantors, on the one hand, and the Administrative Agent and the Lenders, on the other hand, likewise shall be conclusively presumed to have been had orconsummated in reliance upon the guarantee contained in this Section 2. Each Guarantor waives diligence, presentment, protest, demand for payment andnotice of default or nonpayment to or upon the Borrower or any of the Guarantors with respect to the Obligations. Each Guarantor understands and agrees thatthe guarantee contained in this Section 2 shall be construed as a continuing, absolute and unconditional guarantee of payment without regard to (a) the validityor enforceability of the Credit Agreement or any other Loan Document, any of the Obligations or any guarantee or right of offset with respect thereto at anytime or from time to time held by the Administrative Agent or any Lender, (b) any defense, set-off or counterclaim (other than a defense of payment orperformance) which may at any time be available to or be asserted by the Borrower or any other Person against the Administrative Agent or any Lender, or(c) any other circumstance whatsoever (with or without notice to or knowledge of the Borrower or such Guarantor) which constitutes, or might be construedto constitute, an equitable or legal discharge of the Borrower for the Obligations, or of such Guarantor under the guarantee contained in this Section 2, inbankruptcy or in any other instance. When making any demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, theAdministrative Agent or any Lender may, but shall be under no obligation to, make a similar demand on or otherwise pursue such rights and remedies as itmay have against the Borrower, any other Guarantor or any other Person or against guarantee or collateral security pursuant to any other Loan Document forthe Obligations or any right of offset with respect thereto, and any failure by the Administrative Agent or any Lender to make any such demand, to pursuesuch other rights or remedies or to collect any payments from the Borrower, any other Guarantor or any other Person or to realize upon any such guarantee orcollateral security pursuant to any other Loan Document or to exercise any such right of offset, or any release of the Borrower, any other Guarantor or anyother Person or any such guarantee, collateral security or right of offset, shall not relieve any Guarantor of any obligation or liability hereunder, and shall notimpair or affect the rights and remedies, whether express, implied or available as a matter of law, of the Administrative Agent or any Lender against anyGuarantor. For the purposes hereof "demand" shall include the commencement and continuance of any legal proceedings.

2.6 Reinstatement

The guarantee contained in this Section 2 shall continue to be effective, or be reinstated, as the case may be, if at any time payment, or any part thereof,of any of the Obligations is rescinded or must otherwise be restored or returned by the Administrative Agent or any Lender upon the insolvency, bankruptcy,dissolution, liquidation or reorganization of the Borrower or any Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservatorof, or trustee or similar officer for, the Borrower or any Guarantor or any substantial part of its property, or otherwise, all as though such payments had notbeen made.

2.7 Payments

Each Guarantor hereby guarantees that payments hereunder will be paid to the Administrative Agent without set-off or counterclaim in Dollars at theoffice of the Administrative Agent specified in the Credit Agreement.

SECTION 3. REPRESENTATIONS AND WARRANTIES

To induce the Administrative Agent and the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective extensionsof credit to the Borrower, each Guarantor hereby represents and warrants to the Administrative Agent and each Lender that:

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(a) The execution, delivery and performance by the Guarantors of this Guaranty are within the Guarantors' corporate powers, have been duly authorizedby all necessary corporate action, and do not contravene (i) the Guarantors' organizational documents, (ii) any contractual restriction binding on or affectingthe Guarantors or (iii) any applicable laws.

(c) No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or any other thirdparty is required for the due execution, delivery and performance by the Guarantors of this Guaranty.

(d) This Guaranty has been duly executed and delivered by the Guarantors. This Guaranty is the legal, valid and binding obligation of the Guarantorsenforceable against each Guarantor in accordance with its terms, except to the extent that enforceability may be limited by bankruptcy, insolvency or otherlaws affecting creditors' rights generally.

SECTION 4. THE ADMINISTRATIVE AGENT

4.1 Authority of Administrative Agent

Each Guarantor acknowledges that the rights and responsibilities of the Administrative Agent under this Agreement with respect to any action taken bythe Administrative Agent or the exercise or non-exercise by the Administrative Agent of any option, voting right, request, judgment or other right or remedyprovided for herein or resulting or arising out of this Agreement shall, as between the Administrative Agent and the Lenders, be governed by the CreditAgreement and by such other agreements with respect thereto as may exist from time to time among them, but, as between the Administrative Agent and theGuarantors, the Administrative Agent shall be conclusively presumed to be acting as agent for the Lenders with full and valid authority so to act or refrainfrom acting, and no Guarantor shall be under any obligation, or entitlement, to make any inquiry respecting such authority.

SECTION 5. MISCELLANEOUS

5.1 Amendments in Writing

None of the terms or provisions of this Agreement may be waived, amended, supplemented or otherwise modified except in accordance withSection 9.02 of the Credit Agreement.

5.2 Notices

All notices, requests and demands to or upon the Administrative Agent or any Guarantor hereunder shall be effected in the manner provided for inSection 9.01 of the Credit Agreement.

5.3 No Waiver by Course of Conduct; Cumulative Remedies

Neither the Administrative Agent nor any Lender shall by any act (except by a written instrument pursuant to Section 5.1), delay, indulgence, omissionor otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default. No failure to exercise, norany delay in exercising, on the part of the Administrative Agent or any Lender, any right, power or privilege hereunder or under any other Loan Documentshall operate as a waiver thereof. No single or partial exercise of any right, power or privilege hereunder or any other Loan Document shall preclude any otheror further exercise thereof or the exercise of any other right, power or privilege. A waiver by the Administrative Agent or any Lender of any right or remedyhereunder or any other Loan

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Document on any one occasion shall not be construed as a bar to any right or remedy which the Administrative Agent or such Lender would otherwise haveon any future occasion. The rights and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any otherrights or remedies provided by law.

5.4 Enforcement Expenses; Indemnification

(a) Each Guarantor agrees to pay or reimburse each Lender and the Administrative Agent for all its reasonable out-of-pocket costs and expensesincurred in collecting against such Guarantor under the guarantee contained in Section 2 or otherwise enforcing or preserving any rights under this Agreementand the other Loan Documents to which such Guarantor is a party, including, without limitation, the reasonable fees and disbursements of counsel to eachLender and of counsel to the Administrative Agent, subject to any limitations in the Credit Agreement.

(b) Each Guarantor agrees to pay, and to save the Administrative Agent and the Lenders harmless from, any and all liabilities with respect to, orresulting from any delay in paying, any and all stamp, excise, sales or other taxes which may be payable or determined to be payable in connection with anyof the transactions contemplated by this Agreement.

(c) The agreements in this Section 5.4 shall survive repayment of the Obligations and all other amounts payable under the Credit Agreement and theother Loan Documents.

5.5 Successors and Assigns

This Agreement shall be binding upon the successors and assigns of each Guarantor and shall inure to the benefit of the Administrative Agent and theLenders and their successors and assigns; provided that no Guarantor may assign, transfer or delegate any of its rights or obligations under this Agreementwithout the prior written consent of the Administrative Agent.

5.6 Set-Off

In addition to any rights and remedies of the Lenders provided by law, each Lender shall have the right, without notice to any Guarantor, any suchnotice being expressly waived by each Guarantor to the extent permitted by applicable law, upon any Obligations becoming due and payable by anyGuarantor (whether at the stated maturity, by acceleration or otherwise), to apply to the payment of such Obligations, by setoff or otherwise, any and alldeposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each casewhether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by such Lender, any affiliate thereof or any of theirrespective branches or agencies to or for the credit or the account of such Guarantor. Each Lender agrees promptly to notify the relevant Guarantor and theAdministrative Agent after any such application made by such Lender, provided that the failure to give such notice shall not affect the validity of suchapplication.

5.7 Counterparts

This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts (including by telecopy or anyother manner approved pursuant to Section 9.01(b) of the Credit Agreement), and all of said counterparts taken together shall be deemed to constitute one andthe same instrument.

5.8 Severability

7

Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent ofsuch prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdictionshall not invalidate or render unenforceable such provision in any other jurisdiction.

5.9 Section Headings

The Section headings used in this Agreement are for convenience of reference only and are not to affect the construction hereof or be taken intoconsideration in the interpretation hereof.

5.10 Integration

This Agreement and the other Loan Documents represent the agreement of the Guarantors, the Administrative Agent and the Lenders with respect tothe subject matter hereof and thereof, and there are no promises, undertakings, representations or warranties by the Administrative Agent or any Lenderrelative to subject matter hereof and thereof not expressly set forth or referred to herein or in the other Loan Documents.

5.11 GOVERNING LAW

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OFTHE STATE OF NEW YORK.

5.12 Submission To Jurisdiction; Waivers

Each Guarantor hereby irrevocably and unconditionally agrees that the provisions of Sections 9.09 and 9.10 of the Credit Agreement apply to thisAgreement and its obligations hereunder.

5.13 Releases

At such time as the Loans and the other Obligations shall have been paid in full, the Commitments have been terminated, and this Agreement and allobligations (other than those expressly stated to survive such termination) of the Administrative Agent and each Guarantor hereunder shall terminate, allwithout delivery of any instrument or performance of any act by any party.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, each of the undersigned has caused this Guaranty to be duly executed and delivered as of the date first above written.

MF GLOBAL INC.

By: /s/ David Dunne Name: David Dunne Title:

MF GLOBAL HOLDINGS LTD


MF GLOBAL FINANCE USA INC.


[SIGNATURE PAGE TO THE GUARANTY (364-DAY REVOLVING FACILITY)]

Schedule 1

NOTICE ADDRESSES OF GUARANTORS

(i) The Borrower:

MF Global Inc.55 East 52nd Street 39thFloor New York NY 10055Attention: David Dunne, Global Treasurer

with a copy to:

Joe LesarFacsimile: (212) 589 6215

(ii) The Guarantors:

c/o MF Global Holdings Ltd.55 East 52nd Street39th FloorNew York NY 10055Attention: David Dunne, Global Treasurer

with a copy to:

Joe LesarFacsimile: (212) 589 6215

Exhibit 31.1


Certification of the Chief Executive OfficerAs Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Jon S. Corzine, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 of MF Global Holdings Ltd.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the Registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recentfiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely tomaterially affect, the Registrant's internal control over financial reporting; and

5. The Registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theRegistrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal controlover financial reporting.


/s/ Jon S. Corzine Jon S. Corzine

Chief Executive Officer

Exhibit 31.2


Certification of the Chief Financial OfficerAs Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Henri J. Steenkamp, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 of MF Global Holdings Ltd.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the Registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recentfiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely tomaterially affect, the Registrant's internal control over financial reporting; and

5. The Registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theRegistrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal controlover financial reporting.


/s/ Henri J. Steenkamp Henri J. Steenkamp

Chief Financial Officer

Exhibit 32.1


Certification of the Chief Executive OfficerAs Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of MF Global Holdings Ltd. (together with its subsidiaries, the "Company") on Form 10-Q for the quarterended June 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Jon S. Corzine, Chief Executive Officer of theCompany, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ Jon S. Corzine Jon S. Corzine

Chief Executive Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company andfurnished to the Securities and Exchange Commission or its staff upon request.

Exhibit 32.2


Certification of the Chief Financial OfficerAs Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of MF Global Holdings Ltd. (together with its subsidiaries, the "Company") on Form 10-Q for the period endedJune 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Henri J. Steenkamp, Chief Financial Officer of theCompany, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ Henri J. Steenkamp Henri J. Steenkamp

Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company andfurnished to the Securities and Exchange Commission or its staff upon request.