Exhibit 10.01

Execution Version

SECURITIES PURCHASE AGREEMENT

THIS SECURITIES PURCHASE AGREEMENT (the “Agreement”), is dated as of July 29,
2008, by and among Concur Technologies, Inc., a Delaware corporation (the
“Company”), and American Express Travel Related Services Company, Inc., a New
York corporation (the “Investor”) and a wholly-owned subsidiary of American
Express Company, a New York corporation (“Parent”).

BACKGROUND

A. The Company and the Investor are executing and delivering this Agreement in
reliance upon the exemption from registration afforded by Section 4(2) of the
Securities Act of 1933, as amended (the “Securities Act”), and/or Rule 506 of
Regulation D (“Regulation D”) as promulgated by the United States Securities and
Exchange Commission (the “SEC”) under the Securities Act.

B. The Investor wishes to purchase, and the Company wishes to sell and issue to
the Investor, upon the terms and subject to the conditions stated in this
Agreement, (i) an aggregate of up to 6,400,000 shares of the Common Stock (as
adjusted by any stock split, dividend or other distribution, recapitalization or
similar event, the “Shares”) and (ii) warrants to purchase an aggregate of up to
1,280,000 shares of Common Stock (the “Warrants”) in the form attached hereto as
Exhibit B, which Warrants shall be exercisable immediately and have an exercise
price equal to $39.27 per share (“Exercise Price”) and a term of exercise of two
(2) years from and after the Closing (as defined below).

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and the Investor agree as
follows:

ARTICLE I

DEFINITIONS

1.1 Definitions. In addition to the terms defined elsewhere in this Agreement,
the following terms have the meanings indicated:

“Affiliate” means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with a
Person, as such terms are used in and construed under Rule 144 under the
Securities Act.

“Agreement” has the meaning set forth in the Preamble.

“Alliance Agreement” means the Alliance Agreement entered into between the
Company and the Investor on the date hereof, including all exhibits, schedules
and annexes thereto, as amended and/or restated from time-to-time.

 

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“Applicable Law” collectively means any and all laws, rules, regulations, and
governmental, judicial or administrative decrees, orders and decisions that are
applicable to the Company or any of its Subsidiaries, this Agreement, the other
Transaction Documents, including the U.S. Gramm-Leach-Bliley Act of 1999, as
amended, and the regulations promulgated under such Act, the U.S. Fair Credit
Reporting Act of 1970, as amended, or any regulations or guidelines promulgated
under such Act, the U.S. Bank Secrecy Act, orders and guidelines of the Office
of Foreign Assets Control and the USA Patriot Act, and any other applicable data
protection, privacy, consumer protection or confidentiality laws or regulations
(including the rules and regulations of any self-regulatory organization to
which the Company or its securities are subject, including all applicable
Trading Markets).

“Board” has the meaning set forth in Section 2.2.

“Business Day” means any day other than Saturday, Sunday or other day on which
commercial banks in The City of New York are authorized or required by
Applicable Law to remain closed.

“Change of Control of the Company” means a change in ownership or control of the
Company effected through any of the following transactions: (a) a merger,
consolidation or other reorganization approved by the Company’s stockholders,
unless securities representing more than fifty percent (50%) of the total
combined voting power of the voting securities of the successor corporation are
immediately thereafter beneficially owned, directly or indirectly and in
substantially the same proportion, by the Persons who beneficially owned the
Company’s outstanding voting securities immediately prior to such transaction;
(b) a stockholder-approved sale, transfer or other disposition of all or
substantially all of the Company’s assets; or (c) the closing of any transaction
or series of transactions to which any Person or any group of Persons comprising
a “group” within the meaning of Rule 13d-5(b)(1) of the Exchange Act becomes
directly or indirectly the beneficial owner (within the meaning of Rule 13d-3 or
the Exchange Act) of securities possessing (or convertible into or exercisable
for securities possessing) more than fifty percent (50%) of the total combined
voting power of the Company’s securities (as measured in terms of the power to
vote with respect to the election of Board members) outstanding immediately
after the consummation of such transaction or series of transactions, whether
such transaction involves a directly issuance from the Company or the
acquisition of outstanding securities held by one or more of the Company’s
existing stockholders.

“Change of Control of the Investor” means a change in ownership or control of
the Investor effected through any of the following transactions: (a) a merger,
consolidation or other reorganization approved by the Investor’s stockholders,
unless securities representing more than fifty percent (50%) of the total
combined voting power of the voting securities of the successor corporation are
immediately thereafter beneficially owned, directly or indirectly and in
substantially the same proportion, by the Persons who beneficially owned the
Investor’s outstanding voting securities immediately prior to such transaction;
(b) a stockholder-approved sale, transfer or other disposition of all or
substantially all of the Investor’s assets; or (c) the closing of any
transaction or series of transactions to which any Person or any group of
Persons comprising a “group” within the meaning of Rule 13d-5(b)(1) of the
Exchange Act becomes directly or indirectly the beneficial owner (within the
meaning of Rule 13d-3 or the Exchange Act) of securities possessing (or
convertible into or exercisable for securities possessing) more

 

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than fifty percent (50%) of the total combined voting power of the Investor’s
securities (as measured in terms of the power to vote with respect to the
election of Board members) outstanding immediately after the consummation of
such transaction or series of transactions, whether such transaction involves a
directly issuance from the Investor or the acquisition of outstanding securities
held by one or more of the Investor’s existing stockholders.

“Closing” means the closing of the purchase and sale of the Securities pursuant
to Section 2.1.

“Closing Date” means the date and time of the Closing and shall be on such date
and time as is mutually agreed to by the Company and the Investor.

“Common Stock” means the common stock of the Company, par value $0.001 per
share.

“Company” has the meaning set forth in the Preamble.

“Company Counsel” means Fenwick & West LLP, counsel to the Company.

“Company Plans” has the meaning set forth in Section 3.1(k).

“Competing Bid” shall mean an offer by the Investor or any Investor Controlled
Entity, Parent Entity, Affiliate of the Investor or any 13D Group of which the
Investor or any of its Affiliates is a member to acquire Voting Stock of the
Company that, if consummated, would result in a Change of Control of the Company
or the acquisition of all or substantially all of the Company’s assets; provided
that such offer (i) is made during a process described in Section 4.11 or
(ii) follows a publicly announced offer by any Person (other than the Investor
or any Investor Controlled Entity, Parent Entity, Affiliate of the Investor or
any 13D Group of which the Investor or any of its Affiliates is a member) that,
if consummated, would result in a Change of Control of the Company during such
time as such offer is effective.

“Disclosure Letter” has the meaning set forth in the lead-in paragraph to
Article III.

“Disclosure Materials” has the meaning set forth in Section 3.1(h).

“Effectiveness Period” has the meaning set forth in Section 6.1(b).

“Equity Securities” has the meaning set forth in Section 7.1.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Excluded Securities” has the meaning set forth in Section 7.5.

“Exercise Price” has the meaning set forth in the Background.

“GAAP” has the meaning set forth in Section 3.1(h).

“HSR Act” has the meaning set forth in Section 3.1(e).

 

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“Indemnified Party” has the meaning set forth in Section 6.4(c).

“Indemnifying Party” has the meaning set forth in Section 6.4(c).

“Insolvent” has the meaning set forth in Section 3.1(i).

“Intellectual Property” means any and all rights, title and interest in and to
all proprietary rights arising under the Applicable Laws of the United States,
any other jurisdiction or any treaty regime or international convention,
including without limitation: (i) patents and patent continuations, divisionals,
reexaminations, substitutions and reissues; (ii) trademarks, service marks,
corporate names, trade names, service names, brands, trade dress, designs, logos
and Internet domain names, and the goodwill associated therewith;
(iii) copyrights, works of authorship, moral rights, data and database rights;
(iv) trade secrets, know-how, innovations, concepts, research and development,
and inventions (whether or not patentable or reduced to practice); and (v) all
applications, extensions, renewals or translations and other derivative work of
the foregoing in sub-clauses (i) through (iv).

“Investor” has the meaning set forth in the Preamble.

“Investor Controlled Entity” shall mean an entity of which the Investor
collectively owns or controls, directly or indirectly, not less than a majority
of the outstanding voting power entitled to vote in the election of directors of
such entity (or, in the event the entity is not a corporation, the governing
members, board or other similar body of such entity).

“Investor Director” has the meaning set forth in Section 4.5.

“Lien” means, with respect to any asset, any pledge, lien, collateral
assignment, security interest, encumbrance, right of first refusal, mortgage,
deed of trust, title retention, conditional sale or other security arrangement,
or adverse claim of title.

“Losses” means any and all losses, claims, damages, liabilities, settlement
costs and expenses, including, without limitation, reasonable attorneys’ fees.

“Material Adverse Effect” means (i) a material adverse effect on the legality,
validity, or enforceability of any of the Transaction Documents, (ii) a material
adverse effect on the results of operations, assets, business or financial
condition of the Company and the Subsidiaries, taken as a whole on a
consolidated basis, or (iii) a material adverse effect on the Company’s ability
to perform on a timely basis its obligations under any of the Transaction
Documents.

“Material Permits” has the meaning set forth in Section 3.1(m).

“Non-Voting Convertible Securities” means any securities of the Company that are
convertible into, exchangeable for or otherwise exercisable to acquire Voting
Stock of the Company, including convertible securities, warrants, rights or
options to purchase Voting Stock of the Company.

 

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“Parent Entity” shall mean any entity that owns, directly or indirectly, at
least a majority of the outstanding voting power entitled to vote in the
election of directors of the Investor.

“Person” means any individual, corporation, limited liability company,
partnership, joint venture, trust, incorporated or unincorporated association,
joint stock company, unincorporated organization, a government or any
department, subdivision or agency thereof, or other entity of any kind.

“Plan of Distribution” has the meaning set forth in Section 6.1(a).

“Preferred Stock” means the preferred stock of the Company, par value $0.001 per
share.

“Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, or a partial proceeding, such as a deposition),
whether commenced or threatened in writing.

“Prospectus” means the prospectus included in a Registration Statement
(including, without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by a
Registration Statement, and all other amendments and supplements to the
Prospectus including post-effective amendments, and all material incorporated by
reference or deemed to be incorporated by reference in such Prospectus.

“Purchase Price” has the meaning set forth in Section 2.1.

“Purchase Rights” has the meaning set forth in Section 7.1.

“Registrable Securities” means the Shares and the Warrant Shares issued or
issuable pursuant to the Transaction Documents, together with any securities
issued or issuable upon any stock split, dividend or other distribution,
recapitalization or similar event with respect to the foregoing.

“Registration Statement” means each registration statement filed under
Article VI, including (in each case) the Prospectus, amendments and supplements
to such registration statement or Prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference or
deemed to be incorporated by reference in such registration statement.

“Regulation D” has the meaning set forth in the Background.

“Rights Agreement” means that certain Rights Agreement dated as of April 20,
2001, by and between the Company and Wells Fargo N.A., as amended and/or
restated from time-to-time.

 

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“Rule 144,” “Rule 144(c),” “Rule 415,” and “Rule 424” means Rule 144, Rule
144(c), Rule 415 and Rule 424, respectively, promulgated by the SEC pursuant to
the Securities Act, as such Rules may be amended from time to time, or any
similar rule or regulation hereafter adopted by the SEC having substantially the
same effect as such Rule.

“SEC” has the meaning set forth in the Background.

“SEC Reports” has the meaning set forth in Section 3.1(h).

“Securities” means, collectively, the Shares, the Warrants and the Warrant
Shares.

“Securities Act” has the meaning set forth in the Background.

“Shares” has the meaning set forth in the Background.

“Subsidiary” means any direct or indirect subsidiary of the Company.

“Total Current Voting Power” shall mean, with respect to any entity, at the time
of determination of Total Current Voting Power, the total number of votes which
may be cast in the election of members of the board of directors of the
corporation if all securities entitled to vote in the election of such directors
are present and voted (or, in the event the entity is not a corporation, the
governing members, board or other similar body of such entity).

“Trading Day” means (a) any day on which the Securities are listed or quoted and
traded on their primary Trading Market, or (b) if trading ceases to occur on any
Trading Market, any Business Day.

“Trading Market” means the over-the-counter market or any national securities
exchange, market or trading or quotation facility on which the Common Stock is
then listed or quoted.

“Transaction Documents” means this Agreement, the schedules and exhibits
attached hereto, and the Warrants.

“Transfer Agent” means Wells Fargo or any successor transfer agent for the
Company.

“Voting Stock” means shares of Common Stock and any other securities of the
Company having the ordinary power to vote in the election of members of the
Board.

“Warrants” has the meaning set forth in the Background.

“Warrant Shares” means the shares of Common Stock to be issued upon exercise of
the Warrants (as adjusted by any stock split, dividend or other distribution,
recapitalization or similar event).

 

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“13D Group” means any group of Persons that would be required under
Section 13(d) of the Exchange Act, and the rules and regulations promulgated
thereunder, to file a statement on Schedule 13D or Schedule 13G with the SEC as
a “person” within the meaning of Section 13(d)(3) of the Exchange Act if such
group beneficially owned Voting Stock representing more than 5% of any class of
Voting Stock then outstanding.

ARTICLE II

PURCHASE AND SALE

2.1 Purchase and Sale of the Shares and Warrants. Subject to the terms and
conditions of this Agreement, the Investor hereby agrees to purchase, and the
Company hereby agrees to sell and issue to the Investor, the Shares and Warrants
as set forth opposite the Investor’s name on Exhibit A for the aggregate
purchase price (the “Purchase Price”) set forth opposite the Investor’s name on
Exhibit A.

2.2 Closing.

(a) At the Closing, the Company shall deliver to the Investor (i) the Shares and
Warrants, registered in the name of the Investor as indicated on Exhibit A;
(ii) a legal opinion from Company Counsel in the form set forth on Exhibit D;
(iii) a certificate, in the form set forth on Exhibit E-1, executed by the
secretary of the Company and dated as of the Closing Date, as to the Certificate
of Incorporation, by-laws, foreign qualification, incumbency of the Company’s
officers and good standing of the Company and the resolutions adopted by the
Company’s Board of Directors (the “Board”) authorizing the transactions
contemplated by the Transaction Documents; and (iv) the Alliance Agreement.

(b) At the Closing, the Investor shall deliver to the Company (i) the Purchase
Price to the Company by wire transfer of immediately available funds to an
account specified by the Company in writing, (ii) a certificate, in the form set
forth on Exhibit E-2, executed by the secretary of the Investor and dated as of
the Closing Date, as to the certificate of incorporation, by-laws, foreign
qualification, incumbency of any officer of Investor signing any Transaction
Document and good standing of the Investor and the resolutions adopted by the
Investor’s board of directors authorizing the transactions contemplated by the
Transaction Documents and, (iii) the Alliance Agreement.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties of the Company. Except as disclosed in the
SEC Reports filed since January 1, 2006 (but excluding all disclosures contained
in the exhibits to such SEC Reports and the schedules to such exhibits,
excluding the “Risk Factors” section contained in such SEC Reports, and
excluding forward-looking statements identifying risks and uncertainties that
are not historical facts contained in such SEC Reports) or the Disclosure Letter
delivered by the Company to the Investor concurrently with the execution hereof
(the “Disclosure Letter”), the Company hereby represents and warrants to the
Investor as follows:

(a) Subsidiaries. The Company has no Subsidiaries other than those listed on
Section 3.1(a) of the Disclosure Letter. Except as disclosed in Section 3.1(a)
of the Disclosure Letter, the Company owns, directly or indirectly, all of the
capital stock or comparable equity interests of each Subsidiary free and clear
of any Lien and all the issued and outstanding shares of capital stock or
comparable equity interest of each Subsidiary are validly issued and are fully
paid, non-assessable and free of preemptive and similar rights.

 

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(b) Organization and Qualification. Each of the Company and its Subsidiaries is
an entity duly organized, validly existing and in good standing under the
Applicable Laws of the jurisdiction of its incorporation or organization (as
applicable), with the requisite legal authority to own or lease and use its
properties and assets and to carry on its business as currently conducted.
Neither the Company nor any Subsidiary is in violation of any of the provisions
of its respective certificate or articles of incorporation or by-laws or other
organizational or charter documents. Each of the Company and its Subsidiaries is
duly qualified to do business and is in good standing as a foreign corporation
or other entity in each jurisdiction in which the nature of the business
conducted or property owned by it makes such qualification necessary, except
where the failure to be so qualified or in good standing, as the case may be,
has not had and would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.

(c) Authorization; Enforcement. The Company has the requisite corporate power
and authority to enter into and to consummate the transactions contemplated by
each of the Transaction Documents and otherwise to carry out its obligations
hereunder and thereunder. The execution and delivery of each of the Transaction
Documents by the Company and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action on the part of the Company and no further consent or action is
required by the Company, its officers, the Board or its stockholders. The
issuance of the Shares, the Warrants and the Warrant Shares do not require the
approval of the stockholders of the Company. Each of the Transaction Documents
has been (or upon delivery will be) duly executed by the Company and is, or when
delivered in accordance with the terms hereof, will constitute, the valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms, except as may be limited by (i) applicable bankruptcy,
insolvency, reorganization or other Applicable Laws of general application
relating to or affecting the enforcement of creditors rights generally; and
(ii) the effect of rules of law governing the availability of specific
performance and other equitable remedies.

(d) No Conflicts. The execution, delivery and performance by the Company of the
Transaction Documents and the consummation by the Company of the transactions
contemplated hereby and thereby do not and will not (i) conflict with or violate
any provision of the Company’s or any Subsidiary’s certificate or articles of
incorporation, by-laws or other organizational or charter documents;
(ii) conflict with, or constitute a default (or an event that with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation (with or without
notice, lapse of time or both) of, any agreement, credit facility, debt or other
instrument (evidencing a Company or Subsidiary debt or otherwise) to which the
Company or any Subsidiary is a party or by which any property or asset of the
Company or any Subsidiary is bound or affected; or (iii) result in a violation
of any Applicable Law, except, in the case of clause (ii) or (iii), to the
extent that such conflict or violation has not had and would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

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(e) Filings, Consents and Approvals. The Company is not required to obtain any
consent, waiver, authorization or order of, give notice to, or make any filing
or registration with, any court or other federal, state, local or other
governmental authority or other Person in connection with the execution,
delivery and performance by the Company of the Transaction Documents or the
consummation of the transactions contemplated hereby and thereby, other than
(i) the filing of notice under the Hart-Scott-Rodino Antitrust Improvements Act
of 1976 (“HSR Act”), (ii) the filings required to comply with the Company’s
registration obligations hereunder, (iii) the application(s) to each Trading
Market for the listing of the shares of Common Stock purchased pursuant to this
Agreement and the Warrant Shares for trading thereon in the time and manner
required thereby, and (iv) filings required under applicable U.S. federal and
state securities laws.

(f) The Securities. The Securities are duly authorized and, when issued and paid
for in accordance with the Transaction Documents, will be duly and validly
issued, fully paid and nonassessable, free and clear of all Liens and will not
be subject to preemptive rights, rights of first refusal, or similar rights of
stockholders. The Company has reserved from its duly authorized capital stock
the maximum number of shares of Common Stock issuable pursuant to this Agreement
and upon exercise of the Warrants.

(g) Capitalization. As of July 25, 2008, the aggregate number of shares and type
of all authorized, issued and outstanding classes of capital stock, options and
other securities of the Company (whether or not presently convertible into or
exercisable or exchangeable for shares of capital stock of the Company) consists
of (i) 60,000,000 authorized shares of Common Stock, with 42,980,671 shares of
Common Stock outstanding; (ii) 5,000,000 shares of Preferred Stock, consisting
of 400,000 shares designated as “Series A Junior Participating Preferred Stock,”
none of which are outstanding; (iii) no shares of Common Stock, on a diluted
basis, reserved for issuance upon the exercise of outstanding warrants; and
(iv) 5,277,116 shares of Common Stock, reserved for issuance upon the exercise
of outstanding employee stock options and/or restricted stock units. Since
July 25, 2008, the Company has not issued or granted, as applicable, any capital
stock, options or other securities of the Company (whether or not presently
convertible into or exercisable or exchangeable for shares of capital stock of
the Company). All outstanding shares of capital stock are duly authorized,
validly issued, fully paid and nonassessable and have been issued in compliance
with all applicable securities laws and regulations. Except as disclosed in this
Section 3.1(g) or in Section 3.1(g) of the Disclosure Letter, the Company does
not have outstanding any other options, warrants, rights to subscribe to, calls
or commitments of any character whatsoever relating to, or securities, rights or
obligations convertible into or exercisable or exchangeable for, or entered into
any agreement giving any Person any right to subscribe for or acquire, any
shares of Preferred Stock or Common Stock, or securities or rights convertible
or exchangeable into shares of Preferred Stock or Common Stock. Except for the
Rights Agreement there are no anti-dilution or price adjustment provisions
contained in any security issued by the Company (or in any agreement providing
rights to security holders) and the issuance and sale of the Securities will not
obligate the Company to issue shares of Common Stock or other securities to any
Person (other than the Investor) and will not result in a right of any holder of
securities to adjust the exercise, conversion, exchange or reset price under
such securities. To the knowledge of the Company, based solely on an examination
of Schedules 13D and Schedules 13G on file with the SEC, except pursuant to this
Agreement, no Person or group of related Persons beneficially owns (as
determined pursuant to Rule 13d-3 under the Exchange Act) or has the right to
acquire, by agreement with or by obligation binding upon the Company, beneficial
ownership of in excess of five percent (5%) of the outstanding Common Stock.

 

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(h) SEC Reports; Financial Statements. The Company has filed all reports
required to be filed by it under the Securities Act and the Exchange Act since
January 1, 2006, including pursuant to Sections 13(a) or 15(d) of the Exchange
Act, or has received a valid extension of such time of filing and has filed any
such SEC Reports prior to the expiration of any such extension. Such reports
required to be filed by the Company under the Securities Act and the Exchange
Act, including pursuant to Section 13(a) or 15(d) of the Exchange Act, together
with any materials filed or furnished by the Company under the Securities Act
and the Exchange Act, whether or not any such reports were required being
collectively referred to herein as the “SEC Reports” and, together with this
Agreement and the Disclosure Letter, the “Disclosure Materials”. As of their
respective dates, the SEC Reports filed by the Company complied in all material
respects with the requirements of the Securities Act and the Exchange Act, as
applicable, and the rules and regulations of the SEC promulgated thereunder, and
none of the SEC Reports, when filed by the Company, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. The
financial statements of the Company included in the SEC Reports comply in all
material respects with applicable accounting requirements and the rules and
regulations of the SEC with respect thereto as in effect at the time of filing.
Such financial statements have been prepared in accordance with United States
generally accepted accounting principles applied on a consistent basis during
the periods involved (“GAAP”), except as may be otherwise specified in such
financial statements or the notes thereto and except that unaudited financial
statements may not contain all footnotes required by GAAP, and fairly present in
all material respects the consolidated financial position of the Company and its
consolidated Subsidiaries taken as a whole as of and for the dates thereof and
the results of operations and cash flows for the periods then ended, subject, in
the case of unaudited statements, to normal, immaterial, year-end audit
adjustments. All material agreements to which the Company or any Subsidiary is a
party or to which the property or assets of the Company or any Subsidiary are
subject that are required to be filed with the SEC or identified on the SEC
Reports are included as part of or identified in the SEC Reports.

(i) No Change. Except as otherwise disclosed in the SEC Reports, since
September 30, 2007, (A) there has been no event, occurrence or development that,
individually or in the aggregate, has had or would reasonably be expected to
have a Material Adverse Effect, (B) the Company has not incurred any liabilities
(contingent or otherwise) other than those arising from operations in the
ordinary course of business consistent with past practice, and (C) the Company
has not declared or made any dividend or distribution of cash or other property
to its stockholders, or purchased, redeemed, or made any agreements to purchase
or redeem any shares of its capital stock other than pursuant to the Company’s
stock repurchase plan described in the SEC Reports. The Company has not taken
any steps to seek protection pursuant to any bankruptcy law nor does the Company
believe that its creditors intend to initiate involuntary bankruptcy Proceedings
or have any actual knowledge of any fact which would reasonably lead a creditor
to do so. The Company is not Insolvent (as hereinafter defined) as of the date
hereof, and will not be Insolvent after giving effect to the transactions
contemplated hereby to occur at

 

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the applicable Closing. For purposes of this Section 3.1(i), “Insolvent” means
(i) the present fair saleable value of the Company’s assets is less than the
amount required to pay the Company’s total indebtedness, (ii) the Company is
unable to pay its debts and liabilities, subordinated, contingent or otherwise,
as such debts and liabilities become absolute and matured or (iii) the Company
has unreasonably small capital with which to conduct the business in which it is
engaged as such business is now conducted and is proposed to be conducted.

(j) Litigation. Except as disclosed in Section 3.1(j) of the Disclosure Letter
or the SEC Reports, there is no Proceeding pending or, to the knowledge of the
Company, threatened against the Company or any Subsidiary or any of its
properties that has or would reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect. Neither the Company, nor, to the
knowledge of the Company, any director or officer thereof, is or has been the
subject of any Proceeding involving a claim of violation of or liability under
federal or state securities laws or a claim of breach of fiduciary duty. There
has not been, and to the knowledge of the Company, there is not pending or
contemplated, any investigation involving the Company or, to the knowledge of
the Company, any current or former director or officer of the Company. Except as
disclosed in the Disclosure Letter, neither the Company nor any Subsidiary is a
party or subject to the provisions of any order, writ, injunction, judgment or
decree of any court or government agency or instrumentality that has had or
would reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect. There is no Proceeding by the Company or any Subsidiary
currently pending or which the Company or any Subsidiary intends to initiate
that would reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.

(k) Key Employees. There are no currently effective employment contracts, offer
letters containing economic terms, consulting agreements, deferred compensation
arrangements, bonus plans, incentive plans, profit sharing plans, retirement
agreements or other employee compensation plans or agreements (“Company Plans”)
containing terms and conditions that would result in the material payment to any
employee or former employee of the Company or any of its Subsidiaries of any
material money or other property or the acceleration, vesting or provision of
any other material rights or benefits to any employee or former employee of the
Company or any of its Subsidiaries by virtue of the issuance of the Securities
pursuant to this Agreement (either alone or upon the occurrence of any other
event).

(l) Registration Rights and Voting Rights. Except as required pursuant to
Article VI of this Agreement, the Company is presently not under any obligation,
and has not granted any rights, to register any of the Company’s presently
outstanding securities or any of its securities that may hereafter be issued
that have not expired or been satisfied. To the knowledge of the Company, no
stockholder of the Company has entered into any agreement with respect to the
voting of equity securities of the Company.

(m) Compliance with Laws; Permits. Neither the Company nor any of its
Subsidiaries is, or since January 1, 2006 has been, in violation of any
Applicable Law in respect of the conduct of its business or the ownership of its
properties, which violation has had or would reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect. The Company and its
Subsidiaries possess all certificates, authorizations and permits issued by the
appropriate federal, state, local or foreign regulatory authorities necessary to
conduct their

 

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respective businesses as described in the SEC Reports (“Material Permits”),
except where the failure to possess such permits has not had and would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, and neither the Company nor any Subsidiary has received any
notice of Proceedings relating to the revocation or modification of any Material
Permit, the revocation or modification of which has had or would reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

(n) Offering Valid. Assuming the accuracy of the representations and warranties
of the Investor contained in Section 3.2 hereof, the offer, sale and issuance of
the Common Stock, the Warrants, and the Warrant Shares will be exempt from the
registration requirements of the Securities Act, and will have been registered
or qualified (or are exempt from registration and qualification) under the
registration, permit or qualification requirements of all applicable state
securities laws.

(o) Private Placement. Neither the Company, nor any of its Affiliates, nor any
Person acting on its or their behalf, has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D) in
connection with the offer or sale of the Securities. Neither the Company nor any
of its Affiliates nor, any Person acting on the Company’s behalf has, directly
or indirectly, at any time within the past six months, made any offer or sale of
any security or solicitation of any offer to buy any security under
circumstances that would (i) eliminate the availability of the exemption from
registration under Regulation D in connection with the offer and sale by the
Company of the Securities as contemplated hereby or (ii) cause the offering of
the Securities pursuant to the Transaction Documents to be integrated with prior
offerings by the Company for purposes of any Applicable Law or stockholder
approval provisions, including, without limitation, under the rules and
regulations of any Trading Market in a manner which would require any
stockholder approval.

(p) Illegal Payments. The Company and its Subsidiaries have not, and to the
knowledge of the Company, no director, officer, agent or employee of the Company
or any of its Subsidiaries has paid, caused to be paid, or agreed to pay,
directly or indirectly, in connection with the business of the Company (i) to
any government or agency thereof, any agent or any supplier or customer, any
bribe, kickback or other similar payment; (ii) any contribution to any political
party or candidate (other than from personal funds of directors, officers,
agents or employees not reimbursed by their respective employers), except as
otherwise permitted by Applicable Law; or (iii) intentionally established or
maintained any unrecorded fund or asset or made any false entries on any books
or records for any purpose, except as otherwise permitted by Applicable Law. To
the knowledge of the Company, none of the Company or any of its Subsidiaries
(i) appears on the Specially Designated Nationals and Blocked Persons List of
the Office of Foreign Assets Control or on any other similar list maintained by
the Office of Foreign Assets Control pursuant to any authorizing statute,
executive order or regulation; (ii) is otherwise a party with whom, or has its
principal place of business or the majority of its business operations (measured
by revenues) located in a country in which, transactions are prohibited by
(A) United States Executive Order 13224, Blocking Property and Prohibiting
Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism;
(B) the United States Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001; (C) the United
States Trading with the Enemy Act of 1917, as amended; (D) the United States
International Emergency Economic Powers Act of 1977, as amended or (E) the
foreign asset control regulations of the United States Department of the
Treasury; (iii) has been convicted of or charged with a felony relating to money
laundering or (iv) is under investigation by any Person for money laundering.

 

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(q) Transfer Taxes. On the Closing Date, all stock transfer or other taxes
(other than income taxes) required to be paid in connection with the sale and
transfer of the shares of Common Stock to be sold to the Investor hereunder will
be, or will have been, fully paid or provided for by the Company, and all
Applicable Laws imposing such taxes will be or will have been complied with
fully.

(r) Placement Agent’s Fees. Except for Deutsche Bank Securities and Credit
Suisse, the Company has not employed any broker, investment banker, finder or
other Person in a similar capacity and has not incurred any liability for any
financial advisory fees, brokerage fees, commissions or finder’s fees, and no
broker, investment banker, finder or other Person in a similar capacity has
acted, directly or indirectly, for the Company or any of its Subsidiaries, in
connection with this Agreement or the transactions contemplated hereby. The
Company shall pay, and hold the Investor harmless against, any liability, loss
or expense (including, without limitation, reasonable attorney’s fees and
out-of-pocket expenses) arising in connection with any such claim for fees
arising out of the issuance of the Securities pursuant to this Agreement.

(s) Application of Takeover Protections. Except as described in Section 3.1(s)
of the Disclosure Letter, there is no control share acquisition, business
combination, poison pill (including any distribution under a rights agreement)
or other similar anti-takeover provision under the Company’s charter documents
or the Applicable Laws of its state of incorporation or otherwise, that is or
could become applicable to the Investor as a result of the Investor and the
Company fulfilling their obligations or exercising their rights under the
Transaction Documents, including, without limitation, as a result of the
Company’s issuance of the Securities and the Investor’s ownership of the
Securities.

(t) Intellectual Property. The Company or one of its Subsidiaries owns all
rights, title and interest in, or has legally obtained all necessary rights and
licenses to use for all purposes currently required by the Company and its
Subsidiaries, all Intellectual Property of the Company and its Subsidiaries.
Since January 1, 2003, the Company has not received a written notice that the
Company or any of its Subsidiaries violates or infringes the Intellectual
Property of any Person. To the knowledge of the Company, all Intellectual
Property owned by or exclusively licensed to the Company or any of its
Subsidiaries is valid and enforceable and there is, and since January 1, 2003
has been, no existing infringement by another Person of any of the Intellectual
Property owned by or exclusively licensed to the Company or any of its
Subsidiaries. Except as has not had and would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect, the Company
is in material compliance with all license contracts in favor of the Company
relating to, and there are no infringement or misappropriation actions pending
or, to the knowledge of the Company, threatened against the Company with respect
to, any software owned by the Company or licensed to the Company and
incorporated in the Company’s products and services. Except as has not had and
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect, the Company maintains policies and procedures regarding
data security, website and internet security, privacy, and the use of data that
are commercially reasonable; and, in any event, the Company is in

 

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material compliance with the Company’s obligations under Applicable Law and
contractual obligations with respect to such matters. To the knowledge of the
Company, there has been no breach or violation of any Company website, database
or security policy or any unauthorized access to, or use of, any data used in
the businesses of Company or of any third party’s proprietary or confidential
information which has had or would reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect. Since January 1, 2003, no
allegation relating to an improper use or disclosure, or a breach in the
security of, any such information has been made or threatened against the
Company which has had or is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect. To the knowledge of the Company, there are
no viruses, worms, Trojan horses, self help code or similar programs which would
restrict the proper use or access to any material software used by the Company
which has had a Material Adverse Effect. All material databases, hardware, and
software currently used by the Company perform in substantial compliance with
applicable specifications and the Company has no knowledge of any operating
problems which has had or would reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect in the use thereof. To the knowledge
of the Company, the business of the Company does not constitute unfair
competition or trade practices and the Company has not engaged and does not
engage in any false or misleading advertising practices under the Applicable
Laws of any jurisdiction in which the Company operates or markets any of its
products or services.

3.2 Representations, Warranties and Covenants of the Investor. The Investor
hereby represents and warrants to the Company as follows:

(a) Organization; Authority. The Investor is an entity duly organized, validly
existing and in good standing under the Applicable Laws of the jurisdiction of
its organization with the requisite corporate, partnership or other power and
authority to enter into and to consummate the transactions contemplated by the
Transaction Documents and otherwise to carry out its obligations thereunder. The
purchase by the Investor of the Securities hereunder has been duly authorized by
all necessary corporate, partnership or other action on the part of the
Investor. This Agreement has been duly executed and delivered by the Investor
and constitutes the valid and binding obligation of the Investor, enforceable
against it in accordance with its terms, except as may be limited by
(i) applicable bankruptcy, insolvency, reorganization or other Applicable Laws
of general application relating to or affecting the enforcement of creditors
rights generally, and (ii) the effect of rules of law governing the availability
of specific performance and other equitable remedies. The Investor is not
required to obtain any consent, waiver, authorization or order of, give notice
to, or make any filing or registration with, any court or other federal, state,
local or other governmental authority or other Person in connection with the
execution, delivery and performance by the Investor of the Transaction Documents
or the consummation of the transactions contemplated hereby and thereby, other
than (i) the filing of notice under the HSR Act, and (ii) filings required under
applicable U.S. federal and state securities laws.

(b) No Public Sale or Distribution. The Investor is (i) acquiring the Common
Stock and the Warrants and (ii) upon exercise of the Warrants will acquire the
Warrant Shares issuable upon exercise thereof, not with a view towards, or for
resale in connection with, the public sale or distribution thereof, except
pursuant to sales registered under the Securities Act or under an exemption from
such registration and in compliance with applicable federal and state securities
laws, and the Investor does not have a present arrangement to effect any
distribution of

 

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the Securities to or through any person or entity; provided, however, that by
making the representations herein, the Investor does not agree to hold any of
the Securities for any minimum or other specific term and reserves the right to
dispose of the Securities at any time in accordance with or pursuant to a
registration statement or an exemption under the Securities Act.

(c) Investor Status. At the time the Investor was offered the Securities, it
was, and at the date hereof it is, an “accredited investor” as defined in Rule
501(a) under the Securities Act or a “qualified institutional buyer” as defined
in Rule 144A(a) under the Securities Act.

(d) Experience of the Investor. The Investor, either alone or together with its
representatives, has such knowledge, sophistication and experience in business
and financial matters so as to be capable of evaluating the merits and risks of
the prospective investment in the Securities, and has so evaluated the merits
and risks of such investment. The Investor understands that it must bear the
economic risk of this investment in the Securities, and is able to bear such
risk and is able to afford a complete loss of such investment.

(e) Access to Information. The Investor acknowledges that it has had access to
the Disclosure Materials and information about the Company and the Subsidiaries
and their respective financial condition, results of operations, business,
properties, management and prospects sufficient to enable it to evaluate its
investment. No information, inquiry, or investigation conducted by or on behalf
of the Investor or its representatives or counsel shall modify, amend or affect
the Investor’s right to rely on the truth, accuracy and completeness of the
Disclosure Materials and the Company’s representations and warranties contained
in the Transaction Documents.

(f) Restricted Securities. The Investor understands that the Securities are
characterized as “restricted securities” under the U.S. federal securities laws
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under such laws and applicable regulations
such securities may be resold without registration under the Securities Act only
in certain limited circumstances. The Investor has been advised or is aware that
it may be deemed to be an “affiliate” of the Company within the meaning of the
Securities Act following the execution of this Agreement.

(g) Placement Agent’s Fees. Except for Lazard LLC, the Investor has not employed
any broker, investment banker, finder or other Person in a similar capacity or
incurred any liability for any financial advisory fees, brokerage fees,
commissions or finder’s fees, and no broker, investment banker, finder or other
Person in a similar capacity has acted, directly or indirectly, for the Company
or any of its Subsidiaries, in connection with this Agreement or the
transactions contemplated hereby. The Investor shall pay, and hold the Company
harmless against, any liability, loss or expense (including, without limitation,
reasonable attorney’s fees and out-of-pocket expenses) arising in connection
with any such claim for fees arising out of the purchase of the Securities
pursuant to this Agreement.

 

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(h) Litigation. There is no Proceeding pending or, to the Investor’s knowledge,
threatened against the Investor or any subsidiary or any of its properties which
in any manner challenge or seek to prevent, enjoin, alter or materially delay
the transactions contemplated by this Agreement.

(i) No Ownership of Company Securities. As of the date of this Agreement,
neither the Investor, nor any Investor Controlled Entity, Parent Entity,
Affiliate of the Investor (other than any officer or director of the Investor
and/or Parent) or any 13D Group of which the Investor or any of its Affiliates
is a member, beneficially owns any shares of Common Stock, or any other equity
securities of the Company, or any options, warrants or other rights to acquire
equity securities of the Company or any other securities convertible into equity
securities of the Company. Since March 1, 2008, neither the Investor, nor any
Investor Controlled Entity, Parent Entity, Affiliate of the Investor (other than
any officer or director of the Investor and/or Parent) or any 13D Group of which
the Investor or any of its Affiliates is a member, has purchased, sold,
transferred, made any short sale of, granted any option for the purchase of, or
entered into any hedging or similar transaction with the same economic effect as
a sale of, any equity securities or any options, warrants or other rights to
acquire equity securities of the Company.

ARTICLE IV

OTHER AGREEMENTS OF THE PARTIES

4.1 Transfer Restrictions.

(a) The Investor covenants that the Securities will only be disposed of pursuant
to an effective registration statement under, and in compliance with the
requirements of, the Securities Act, to the Company or pursuant to an available
exemption from the registration requirements of the Securities Act, and in
compliance with any applicable state securities laws. In connection with any
transfer of Securities other than pursuant to an effective registration
statement or to the Company, the Company may require the transferor to provide
to the Company an opinion of counsel selected by the transferor, the form and
substance of which opinion shall be reasonably satisfactory to the Company, to
the effect that such transfer does not require registration under the Securities
Act. Notwithstanding the foregoing, the Company hereby consents to and agrees to
register on the books of the Company and with its Transfer Agent, without any
such legal opinion, except to the extent that the Transfer Agent requests such
legal opinion, any transfer of Securities by the Investor to an Affiliate of the
Investor, provided that (i) the transferee certifies to the Company that it is
an “accredited investor,” as defined in Rule 501(a) under the Securities Act and
(ii) the transferee agrees in writing to be subject to the terms and conditions
of this Agreement.

(b) The Investor agrees to the imprinting, so long as is required by this
Section 4.1(b), of the following legends on any certificate evidencing any of
the Securities in addition to any other legends required by the Rights
Agreement:

THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS AND, ACCORDINGLY, MAY
NOT BE OFFERED OR

 

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SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT
TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH
APPLICABLE STATE SECURITIES LAWS OR BLUE SKY LAWS.

THESE SECURITIES ARE SUBJECT TO TRANSFER RESTRICTIONS AS SET FORTH IN A CERTAIN
SECURITIES PURCHASE AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF
THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE
ISSUER.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON WHO MAY BE
DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF RULE 144 PROMULGATED
UNDER THE SECURITIES ACT.

Certificates evidencing Securities shall not be required to contain the legends
set forth above (i) following any sale of such Securities pursuant to a
Registration Statement covering the resale of the Securities is effective under
the Securities Act; (ii) following any sale of such Securities pursuant to Rule
144 if the holder provides the Company with a legal opinion reasonably
acceptable to the Company to the effect that the Securities have been sold under
Rule 144; (iii) if the Securities are eligible for sale under Rule 144(b)(1); or
(iv) if the holder provides the Company with a legal opinion reasonably
acceptable to the Company to the effect that the legend is not required under
applicable requirements of the Securities Act (including controlling judicial
interpretations and pronouncements issued by the staff of the SEC). The Company
may not make any notation on its records or give instructions to the Transfer
Agent that enlarge the restrictions on transfer set forth in this Section 4.1(b)
unless required by Applicable Law.

(c) The Company will not object to and shall permit (except as prohibited by
Applicable Law) the Investor to pledge or grant a security interest in some or
all of the Securities in connection with a bona fide margin agreement or other
loan or financing arrangement secured by the Securities (provided that the
Securities are part of a basket of securities being pledged or for which a
security interest is being granted and that the Securities do not exceed 15% of
the fair market value of such securities at the time of pledge or grant of the
security interest), and if required under the terms of such agreement, loan or
arrangement, the Company will not object to and shall permit (except as
prohibited by Applicable Law) the Investor to transfer pledged or secured
Securities to the pledges or secured parties. Except as required by Applicable
Law, such a pledge or transfer would not be subject to approval of the Company,
no legal opinion of the pledgee, secured party or pledgor shall be required in
connection therewith. The Investor will provide the Company with reasonably
prompt written notice of such a pledge. The Investor acknowledges that the
Company shall not be responsible for any pledges relating to, or the grant of
any security interest in, any of the Securities or for any agreement,
understanding or arrangement between the Investor and its pledgee or secured
party. At the Investor’s expense, the Company will execute and deliver such
reasonable documentation as a pledgee or secured party of Securities may
reasonably request in connection with a pledge or transfer of the

 

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Securities, including the preparation and filing of any required prospectus
supplement under Rule 424(b)(3) of the Securities Act or other applicable
provision of the Securities Act to appropriately amend the list of selling
stockholders thereunder. Provided that the Company is in compliance with the
terms of this Section 4.1(c), the Company’s indemnification obligations pursuant
to Section 6.4 shall not extend to any Proceeding or Losses arising out of or
related to this Section 4.1(c).

4.2 Furnishing of Information. During the time a Registration Statement is
required to be effective, the Company covenants to timely file (or obtain
extensions in respect thereof and file within the applicable grace period) all
reports required to be filed by the Company after the date hereof pursuant to
the Exchange Act. Upon the request of the Investor, the Company shall deliver to
the Investor a written certification of a duly authorized officer as to whether
it has complied with the preceding sentence. As long as the Investor owns
Securities, if the Company is not required to file reports pursuant to the
Exchange Act, it will prepare and furnish to the Investor and make publicly
available in accordance with Rule 144(c) such information as is required for the
Investor to sell the Securities under Rule 144. The Company further covenants
that it will take such further action as the Investor may reasonably request,
all to the extent necessary from time to time to enable such Person to sell such
Securities without registration under the Securities Act within the limitation
of the exemptions provided by Rule 144.

4.3 Integration. The Company shall not, and shall use its commercially
reasonably efforts to ensure that no Affiliate thereof shall, sell, offer for
sale or solicit offers to buy or otherwise negotiate in respect of any security
(as defined in Section 2 of the Securities Act) that would be integrated with
the offer or sale of the Securities in a manner that would require the
registration under the Securities Act of the sale of the Securities to the
Investor or that would be integrated with the offer or sale of the Securities
such that approval of the stockholders of the Company would be required pursuant
to the rules and regulations of any Trading Market.

4.4 Reservation of Securities. The Company shall maintain a reserve from its
duly authorized shares of Common Stock for issuance pursuant to the Transaction
Documents in such amount as may be required to fulfill its obligations to issue
Warrant Shares under the Transaction Documents. In the event that at any time
the then authorized shares of Common Stock are insufficient for the Company to
satisfy its obligations to issue such Warrant Shares under the Transaction
Documents, the Company shall promptly take such actions as may be required to
increase the number of authorized shares.

4.5 Board Representation. Immediately following the Closing, the Company
covenants and agrees that it will take all steps necessary to appoint one
(1) individual, designated by the Investor and reasonably acceptable to the
Company, to the Board (the “Investor Director”), who will initially be Ed
Gilligan. The Company agrees that it will reimburse the Investor Director for
reasonable costs and expenses in attending Board meetings in accordance with the
Company’s policies for all directors. For so long as the Investor owns at least
10% of the outstanding Common Stock and the Alliance Agreement has not been
terminated and is still in effect, (a) the Investor shall have the right to
nominate one (1) individual to be the Investor Director, designated by the
Investor and reasonably acceptable to the Company, as a member of the Board’s
recommended slate of directors, for election to the Board, (b) the Company will
recommend the election of such individual and will solicit proxies in favor of
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individual and not in favor of any candidate running against such individual,
and (c) in the event of a vacancy in the slot on the Board for the Investor
Director, the Board will promptly fill such vacancy with a candidate designated
by the Investor and reasonably acceptable to the Company. The Company will not
nominate a representative of an Other Payment Solution Provider (as defined in
the Alliance Agreement) to the Board for so long as the Alliance Agreement has
not been terminated and is still in effect.

4.6 Listing of Common Stock. The Company hereby agrees to use commercially
reasonable efforts to maintain the listing of the Common Stock on a Trading
Market, and as soon as reasonably practicable following the Closing (but not
later than the one year anniversary of the closing) to list the Shares and
Warrant Shares on such Trading Market. The Company further agrees, if the
Company applies to have the Common Stock traded on any other Trading Market, it
will include in such application the Shares and the Warrant Shares, and will
take such other action as is necessary or desirable in the reasonable opinion of
the Investor to cause the Shares and Warrant Shares to be listed on such other
Trading Market as promptly as possible. The Company will take all action
reasonably necessary to continue the listing and trading of its Common Stock on
a Trading Market and will comply in all material respects with the Company’s
reporting, filing and other obligations under the by-laws or rules of such
Trading Market.

4.7 Anti-Takeover Provisions. If any control share acquisition, business
combination, poison pill (including any distribution under a rights agreement
(including the Rights Agreement)) or other similar anti-takeover provision under
the Company’s charter documents or the Applicable Laws of its state of
incorporation or otherwise, that is or would reasonably be expected to become
applicable to the Investor as a result of the Investor and the Company
fulfilling their obligations or exercising their rights under the Transaction
Documents, including, without limitation, as a result of the Company’s issuance
of the Securities and the Investor’s ownership of the Securities, shall become
applicable to the transactions contemplated by the Transaction Documents, the
Company and the Board shall use commercially reasonable efforts to grant such
approvals and take such actions as are necessary so that the transactions
contemplated by the Transaction Documents may be consummated as promptly as
practicable on the terms contemplated hereby and otherwise act to minimize the
effects of any such statute or regulation on the transactions contemplated
hereby. In furtherance of the foregoing, as of the Closing Date, the Board will
have amended the Rights Agreement in order to permit the transactions
contemplated herein, such that the Investor shall be excepted from the operation
of the Rights Agreement to the extent that the Investor (including any Investor
Controlled Entity, any Parent Entity, any Affiliate of the Investor (other than
any officer or director of the Investor and/or Parent) and any 13D Group of
which the Investor or any of its Affiliates is a member) does not beneficially
own more than 15.2% of the Company’s outstanding shares of Common Stock.
Notwithstanding anything to the contrary, the Company will have no obligation to
further amend the Rights Agreement in the event the Investor (including any
Investor Controlled Entity, any Parent Entity, any Affiliate of the Investor
(other than any officer or director of the Investor and/or Parent) and any 13D
Group of which the Investor or any of its Affiliates is a member) at any time
beneficially owns more than 15.2% of the Company’s outstanding shares of Common
Stock, but in no event shall this 15.2% limitation affect the Investor’s ability
to hold the Shares, the Warrants and the Warrant Shares.

 

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4.8 Voting. During such time as the Alliance Agreement is in effect, each of the
Investor, any Investor Controlled Entity, any Parent Entity, any Affiliate of
the Investor (other than any officer or director of the Investor and/or Parent)
and any 13D Group of which the Investor or any of its Affiliates is a member
shall vote all Common Stock of the Company they hold in each vote of the
Company’s stockholders, at the Investor’s sole discretion, either (i) in the
manner recommended by the Board or (ii) in proportion to the votes cast by the
other holders of shares of Common Stock; provided that this Section 4.8 shall
not apply to proposals seeking approvals of the Company’s stockholders with
respect to (A) mergers and acquisitions or similar transactions that would
result in a Change of Control of the Company or any issuance of securities that
represent, or when exercised or converted would represent, 20% or more of the
voting power of the Company to an Other Payment Solution Provider (as defined in
the Alliance Agreement) or (B) amendments to the Company’s Certificate of
Incorporation or by-laws that directly conflict with the rights of the Investor
under this Agreement or the Alliance Agreement, or that directly affect the
Investor by naming the Investor specifically in such amendment. With respect to
votes of the Company’s stockholders relating to the election of members of the
Board, each of the Investor, any Investor Controlled Entity, any Parent Entity,
any Affiliate of the Investor (other than any officer or director of the
Investor and/or Parent) and any 13D Group of which the Investor or any of its
Affiliates is a member shall vote all Common Stock of the Company they hold in
favor of the Investor Director and the other individuals recommended by the
Board for election to the Board. During such time as the Alliance Agreement is
in effect, the Investor agrees to take such actions as may be reasonably
necessary to ensure that any Common Stock held by the Investor, any Investor
Controlled Entity, any Parent Entity, any Affiliate of the Investor (other than
any officer or director of the Investor and/or Parent) and any 13D Group of
which the Investor or any of its Affiliates is a member are present for any vote
of the Company’s stockholders for purposes of establishing a quorum with respect
to such vote.

4.9 Standstill; Required Sales.

(a) The Investor agrees that during such time as the Alliance Agreement is in
effect, neither the Investor, nor any Investor Controlled Entity, Parent Entity,
Affiliate of the Investor (other than any officer or director of the Investor
and/or Parent) or any 13D Group of which the Investor or any of its Affiliates
is a member shall directly or indirectly:

(i) except at the specific written request of the Company or pursuant to a
Competing Bid, propose to enter into, directly or indirectly, any merger or
business combination involving the Company or any of its subsidiaries or
divisions;

(ii) otherwise act, alone or in concert with others, to seek to control the
management, Board or policies of the Company; provided that the actions of the
Investor Director in connection with serving on the Board shall be deemed to not
violate this clause (ii);

(iii) enter into any joint venture, securities lending or option agreement, put
or call, guarantee of loans, guarantee of profits or division of losses or
profits, contract, arrangement or understanding with any Person with respect to
any securities of the Company or any Subsidiary of the Company;

 

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(iv) except as permitted by clause (i) of this Section 4.9(a), acquire
additional shares of Voting Stock without the consent of the Board if the effect
of such acquisition would be to increase the percentage of Total Current Voting
Power of the Company represented by all Voting Stock beneficially owned by the
Investor, any Investor Controlled Entity or any Affiliate of the Investor (other
than any officer or director of the Investor and/or Parent) and any 13D Group of
which the Investor or any of its Affiliates is a party, including any Voting
Stock issuable upon the exercise of any Non-Voting Convertible Securities, to
more than 15.2% of the Company’s outstanding shares of Common Stock;

(v) solicit or participate in the solicitation of proxies with respect to any
Voting Stock, or seek to advise or influence any person with respect to the
voting of any Voting Stock (other than as otherwise provided or contemplated by
this Agreement); provided that this clause (v) shall not apply to proposals with
respect to the matters described in clauses (A) and (B) of the proviso at the
end of the first sentence of Section 4.8 and shall not apply to the actions of
the Investor Director in his or her capacity as such;

(vi) deposit any Voting Stock in a voting trust or, except as otherwise provided
or contemplated herein, subject any Voting Stock to any arrangement or agreement
with any third party with respect to the voting of such Voting Stock;

(vii) join a 13D Group (other than a group comprising solely of the Investor and
its Affiliates) for the purpose of acquiring, holding, voting or disposing of
Voting Stock or Non-Voting Convertible Securities;

(viii) unless and until the Investor fully exercises the Warrants or the term of
the Warrants has expired, own or control more than 13.0% of the outstanding
Common Stock unless acquired from the Company;

(ix) except at the specific written request of the Company or pursuant to a
Competing Bid, take any action which might require the Company to make a public
announcement regarding the possibility of a business combination or merger
involving the Company or any of its subsidiaries or divisions;

(x) disclose any intention, plan or arrangement inconsistent with the foregoing;

(xi) advise, assist or encourage any other Persons in connection with any of the
foregoing; or

(xii) request that the Company (or its respective directors, officers,
affiliates, employees or agents), directly or indirectly, amend or waive any
provision of this Section 4.9(a).

Notwithstanding anything to the contrary in this Agreement, (i) the prohibitions
in this Article IV shall not affect the Investor’s ability to hold the Shares,
the Warrants and the Warrant Shares, (ii) the prohibitions in this
Section 4.9(a) shall not prevent the Investor from making an offer to the Board
to acquire all of the outstanding shares of the Company or proposing to the
Company any other strategic transaction, so long as such offer or proposal is
not publicly disclosed, (iii) in the event that it shall be publicly announced
or disclosed that the

 

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Company has entered into a Change of Control of the Company transaction, that
the Company has received an unsolicited offer (determined to be bona fide by the
Board in good faith) for a majority of the outstanding shares of capital stock
of the Company or for the sale of the Company or substantially all of its assets
at any time, the Investor shall be released from compliance with the terms of
this Section 4.9(a) for the pendency of such transaction, offer or process, and
(iv) this Section 4.9(a) shall not prevent the Investor from taking any action
in connection with participating in any sale process described in Section 4.11.

(b) In the event that the Investor or any Investor Controlled Entity, Parent
Entity, Affiliate of the Investor (other than any officer or director of the
Investor and/or Parent) or any 13D Group of which the Investor or any of its
Affiliates is a member purchases or otherwise acquires shares of Common Stock,
the Investor will provide written notice to the Company of the number of shares
so purchased or acquired as required by Applicable Law. In the event that the
Company becomes aware that the Investor (together with any Investor Controlled
Entity, Parent Entity, Affiliate of the Investor (other than any officer or
director of the Investor and/or Parent) or any 13D Group of which the Investor
or any of its Affiliates is a member) exceeds the ownership limitations under
Section 4.9(a), the Company will promptly provide written notice to the
Investor. Following delivery of such notice, at the option of the Company, the
Investor must either (i) sell shares of Common Stock to the Company, as soon as
reasonably practicable after it receives notice thereof from the Company, at the
closing price of the Common Stock on a Trading Market on the day prior to the
date on which the Investor receives such notice, or (ii) sell such shares to a
third party as soon as reasonably practicable after receiving such notice in
accordance with Section 4.10, in each case to cause the Investor’s holdings
(together with the holdings of any Investor Controlled Entity, Parent Entity,
Affiliate of the Investor (other than any officer or director of the Investor
and/or Parent) or any 13D Group of which the Investor or any of its Affiliates
is a member) not to exceed such ownership limitations. If the Investor violates
the provisions of clause (iv) or clause (viii) of Section 4.9(a), the sole and
exclusive remedy of the Company shall be to require (including through an action
seeking specific performance under Section 8.14) the Investor to sell such
shares of Common Stock that exceed the ownership limitations under such clauses
of Section 4.9(a) pursuant to the preceding sentence either to the Company or a
third party, together with direct damages including reasonable attorney’s fees
and expenses incurred directly by the Company in connection with enforcing its
rights under this Section 4.9(b).

4.10 Lock-Up. From and after the Closing until (A) the first anniversary of the
Closing in the case of the Shares and (B) the later of the first anniversary of
the Closing or six months after the date on which the Warrants are exercised for
Warrant Shares in the case of the Warrant Shares, the Investor hereby agrees not
to (i) sell, transfer or otherwise dispose of, directly or indirectly, any
Shares or Warrant Shares or (ii) enter into any swap or other arrangement that
transfers to another Person any of the economic consequences of ownership of
Shares or Warrant Shares, except to the Company, in response to a tender or
exchange offer for the Common Stock (other than a tender or exchange offer by
the Investor, any Investor Controlled Entity, any Parent Entity, any Affiliate
of the Investor or any 13D Group of which the Investor or any of its Affiliates
is a member) or as part of a transaction in which all outstanding shares of
Common Stock of the Company are converted into or exchanged for other
consideration and is approved by the stockholders of the Company. Thereafter,
until the date on which the Investor (including any Investor Controlled Entity,
any Parent Entity, any Affiliate of

 

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the Investor (other than any officer or director of the Investor and/or Parent)
or any 13D Group of which the Investor or any of its Affiliates is a member)
owns less than 3.5% of the voting power of the Company, the Investor may
transfer any Shares or Warrant Shares in the following circumstances: (i) in
broker transactions pursuant to Rule 144, (ii) in block sales, pursuant to Rule
144 to any Person who would not own or control more than 5% of the voting power
of the Company, (iii) pursuant to privately negotiated transactions to any
Person who would not own or control more than 5% of the voting power of the
Company, (iv) pursuant to a public offering as long as the Investor does not
knowingly sell shares of Common Stock to any Person who would own more than 5%
of the voting power of the Company, (v) transfers to Affiliates of the Investor
in accordance with the terms of this Agreement, provided that such Affiliate
agrees to be bound by the terms of this Agreement, (vi) conversions of shares of
Common Stock into other classes of Common Stock without change of holder,
(vii) to the Company in connection with share repurchases by the Company,
(viii) in response to a tender or exchange offer for the Common Stock (other
than a tender or exchange offer by the Investor, any Investor Controlled Entity,
any Parent Entity, any Affiliate of the Investor or any 13D Group of which the
Investor or any of its Affiliates is a member) or (ix) as part of a transaction
in which all outstanding shares of Common Stock of the Company are converted
into or exchanged for other consideration and is approved by the stockholders of
the Company; provided that in no event may the aggregate amount of shares of
Common Stock transferred pursuant to clauses (i) through (iv) of this sentence
in a three-month period exceed 2.5% of the voting power of the Company. From and
after the later of the first anniversary of the Closing and the date on which
the Investor owns less than 3.5% of the voting power of the Company, the
Investor may sell, transfer or otherwise dispose of the Shares or the Warrant
Shares without regard to the limitations in this Section 4.10.

4.11 Sale of the Company and Right of Notice. Until the earlier of (a) the date
that the Alliance Agreement is no longer in effect plus, in the event that the
Company chooses not to renew the Alliance Agreement, a period of twelve months
from the date that the Company provides notice to the Investor of such intention
not to renew or (b) the date that the Investor, any Investor Controlled Entity,
any Parent Entity, any Affiliate of the Investor (other than any officer or
director of the Investor and/or Parent) or any 13D Group of which the Investor
or any of its Affiliates is a member collectively beneficially own less than 5%
of the outstanding Common Stock for a period of at least ninety consecutive
days, in the event that the Board initiates or participates in a sale process
(including discussions with third parties (other than legal or financial
advisors of the Company) with respect to any such process or any potential
transaction referred to in clause (i) or (ii) of this Section 4.11) with respect
to (i) the sale or other disposition, directly or indirectly, of substantially
all of the assets of, or securities sufficient to result in a Change of Control
of the Company or (ii) a merger, amalgamation, consolidation, share exchange,
business combination, reorganization, recapitalization, tender offer,
liquidation, dissolution, sale of majority of assets or other transaction
involving the Company, (A) the Company shall deliver to the Investor prompt
written notice of the commencement of such process and (B) the Investor shall be
entitled to participate as a bidder in such process (which shall not include
direct or indirect discussions with such third parties); provided that the
Investor responds by providing an indication of interest to participate in the
process by the time period set forth in such notice, which shall in no event be
less than five Business Days. The Investor’s notice, diligence and participatory
rights with respect to such process shall be no less favorable than the notice,
diligence and participatory rights of other bidders participating in such
process.

 

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4.12 Press Releases. No later than the Trading Day immediately following the
execution of this Agreement, the Company and the Investor will issue a mutually
acceptable press release disclosing the transactions contemplated by the
Agreement and the Alliance Agreement. The Company and the Investor shall consult
with each other in issuing any subsequent press releases with respect to the
transactions contemplated hereby, and the Company and the Investor shall not
issue any such press release or otherwise make any such public statement without
the prior consent of the other party, which consent shall not be unreasonably
withheld, conditioned or delayed, except if such disclosure is required by
Applicable Law, in which case the disclosing party shall promptly provide the
other party with prior notice of such public statement or communication.

4.13 Shareholders Rights Plan. No claim will be made or enforced by the Company
that the Investor is an “Acquiring Person” under any shareholders rights plan or
similar plan or arrangement in effect or hereafter adopted by the Company, or
that the Investor could be deemed to trigger the provisions of any such plan or
arrangement, by virtue of receiving Securities under the Transaction Documents.
The Board has amended the Rights Agreement in order to permit the transactions
contemplated herein, such that the Investor shall be excepted from the operation
of the Rights Agreement to the extent that the Investor is in compliance with
the terms of this Agreement related to ownership of the securities of the
Company.

4.14 D&O Insurance. The Company shall provide and maintain coverage for the
Investor Director under the Company’s directors’ and officers’ insurance and
indemnification policy on the same terms and conditions as provided from time to
time for other members of the Board.

4.15 Corporate Opportunities.

(a) The Investor and the Investor Director may engage in or have interests in
other investments or business ventures of any nature or description,
independently or with others, similar to the business of the Company and in such
capacity may possess or acquire information relating to such interests,
investments or business ventures. The Company shall have no rights in or to any
such interests, investments, business ventures or information, and the Investor
and the Investor Director shall have no obligation to present any such
interests, investments, business ventures or information to the Company and may
use such interests, investments, business ventures or information for its own
benefit or for the benefit of any other party; provided that such interests,
investments, business ventures or information were not solely derived from or
obtained solely as a result of the Investor’s receipt of confidential
information of the Company in connection with its purchase of the Securities or
supplied or provided solely by or on behalf of the Company to the Investor
Director in his or her capacity solely as a director of the Company. For the
avoidance of doubt, from the time of the effectiveness of the Alliance
Agreement, the Investor hereby acknowledges that it will be required to comply
with the terms and conditions contained therein.

(b) The Company acknowledges that the Investor Director may be approached
outside of his or her capacity solely as a director of the Company, with respect
to potential transactions or other business opportunities that may or may not be
competitive with the business of the Company and with respect to information not
described in Section 4.15(a) above that may

 

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or may not be useful or important to the Company. The Investor Director shall
not be obligated under such circumstances to present any such information,
transaction or business opportunity to the Company, even if such transaction or
other opportunity is of a character that, if presented to the Company, could be
taken by the Company, and with respect to information, is of such character so
as to be reasonably important or useful to the Company; provided that such
information, transaction or business opportunity was not solely derived from or
obtained solely as a result of the Investor’s receipt of confidential
information of the Company in connection with its purchase of the Securities or
supplied or provided solely by or on behalf of the Company to the Investor
Director in his or her capacity solely as a director of the Company. The
Investor Director shall be free under such circumstances to pursue and use any
such information, transaction or other such opportunity for his or her own
account or for the account of any other party including the Investor and, to the
fullest extent permitted by Applicable Law, the Investor Director shall not be
deemed to have breached any duty (contractual or otherwise) to the Company (and
shall not be liable to the Company for breach of any duty) by reason of any
activities or omissions of the types referred to in this Section 4.15 or the
participation therein by the Investor or the Investor Director. For the
avoidance of doubt, the parties hereby acknowledge that the Investor Director,
in the exercise of his or her fiduciary duties as a member of the Board, shall,
among other things, recuse himself or herself from any Board discussions or
deliberations when required by applicable Delaware corporate law.

4.16 Equity Method/Information Rights. If at any time the Investor is required
to account for its interest in the Company using the “equity method” of
accounting, the Company will furnish, or cause to be furnished, to the Investor
such additional information regarding the Investor’s investment in the Company
as the Investor may reasonably request and to the extent necessary to permit the
Investor, Parent or their Affiliates to comply on a timely basis with their
financial reporting obligations in respect of the Investor’s investment in the
Company.

4.17 Antitrust Filings. If the exercise of the Warrants requires any antitrust
filings under Applicable Law (including the HSR Act), then the Investor and the
Company agree to make any such required filings and to cooperate with each other
in making any such filings.

ARTICLE V

CONDITIONS PRECEDENT

5.1 Conditions Precedent to the Obligations of the Investor. The obligation of
the Investor to acquire Securities at the Closing is subject to the satisfaction
or waiver by the Investor, at the Closing, of each of the following conditions:

(a) Representations and Warranties. The representations and warranties of the
Company contained herein shall be true and correct in all material respects
(other than those representations and warranties that are qualified by
materiality or Material Adverse Effect qualifiers, which shall be true and
correct in all respects) as of the date when made and as of the Closing as
though made on and as of such date.

(b) Performance. The Company shall have performed, satisfied and complied in all
material respects with all covenants, agreements and conditions required by the
Transaction Documents to be performed, satisfied or complied with by it at or
prior to the Closing.

 

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(c) Alliance Agreement. The Alliance Agreement shall have been executed and
delivered by the Company.

(d) No Stockholder Approval Required. No approval on the part of the
stockholders of the Company shall be required in connection with the execution
and delivery by the Company of this Agreement and the other Transaction
Documents and the consummation of the transactions to be performed by the
Company contemplated by the Transaction Documents.

(e) Regulatory Approvals. Any applicable waiting periods under the HSR Act and
any applicable foreign antitrust laws relating to the consummation of the
transactions contemplated by this Agreement and the other Transaction Documents
and the Alliance Agreement shall have expired or been terminated and all
material approvals, authorizations and consents of any governmental entity or
Person required to consummate the transactions contemplated by this Agreement
and the other Transaction Documents and the Alliance Agreement (including any
such approvals, authorizations and consents under applicable foreign antitrust
laws) shall have been obtained and remain in full force and effect, and all
statutory waiting periods relating to such approvals, authorizations and
consents shall have expired or been terminated.

(f) Qualification Under State Securities Laws. All registrations,
qualifications, permits and approvals, if any, required to be obtained prior to
the Closing under applicable state securities laws shall have been obtained for
the lawful execution, delivery and performance of this Agreement and the other
Transaction Documents, including, without limitation, the offer and sale of the
Securities.

(g) No Litigation. No litigation, order, writ, injunction, judgment, decree or
other claim shall be pending or, to the knowledge of the Investor, threatened
that questions the validity of this Agreement or the other Transaction Documents
or the right of the Company or the Investor to enter into such agreements or to
consummate the transactions contemplated hereby and thereby.

(h) No Violation. No statute, rule, regulation, order, or interpretation shall
have been enacted, entered or deemed applicable by any domestic or foreign
government or governmental or administrative agency or court which would make
the transactions contemplated by the Agreement or the other Transaction
Documents illegal.

5.2 Conditions Precedent to the Obligations of the Company. The obligation of
the Company to sell the Securities at the Closing is subject to the satisfaction
or waiver by the Company, at the Closing, of each of the following conditions:

(a) Representations and Warranties. The representations and warranties of the
Investor contained herein shall be true and correct in all material respects as
of the date when made and as of the Closing Date as though made on and as of
such date.

(b) Performance. The Investor shall have performed, satisfied and complied in
all material respects with all covenants, agreements and conditions required by
this Agreement and the other Transaction Documents to be performed, satisfied or
complied with by the Investor at or prior to the Closing.

 

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(c) Alliance Agreement. The Alliance Agreement shall have been executed and
delivered by the Investor.

(d) Regulatory Approvals. Any applicable waiting periods under the HSR Act and
any applicable foreign antitrust laws relating to the consummation of the
transactions contemplated by this Agreement and the other Transaction Documents
and the Alliance Agreement shall have expired or been terminated and all
material approvals, authorizations and consents of any governmental entity or
Person required to consummate the transactions contemplated by this Agreement
and the other Transaction Documents and the Alliance Agreement (including any
such approvals, authorizations and consents under applicable foreign antitrust
laws) shall have been obtained and remain in full force and effect, and all
statutory waiting periods relating to such approvals, authorizations and
consents shall have expired or been terminated.

(e) Qualification Under State Securities Laws. All registrations,
qualifications, permits and approvals, if any, required to be obtained prior to
the Closing under applicable state securities laws shall have been obtained for
the lawful execution, delivery and performance of this Agreement and the other
Transaction Documents, including, without limitation, the offer and sale of the
Securities.

(f) No Litigation. No litigation, order, writ, injunction, judgment, decree or
other claim shall be pending or, to the knowledge of the Company, threatened
that questions the validity of this Agreement or the other Transaction Documents
or the right of the Company or the Investor to enter into such agreements or to
consummate the transactions contemplated hereby and thereby.

(g) No Violation. No statute, rule, regulation, order, or interpretation shall
have been enacted, entered or deemed applicable by any domestic or foreign
government or governmental or administrative agency or court which would make
the transactions contemplated by this Agreement or the other Transaction
Documents illegal.

ARTICLE VI

REGISTRATION RIGHTS

6.1 Registration Statement.

(a) During the time period beginning on the first anniversary of the Closing
Date and ending on the earlier of (x) the date that all Registrable Securities
covered by such Registration Statement have been sold or can be sold publicly
under Rule 144 without volume limitation or (y) the date that the Alliance
Agreement is no longer in effect plus a period of six months thereafter, upon
written request by the Investor, the Company shall, as soon as reasonably
practicable, prepare and file with the SEC a Registration Statement covering the
resale of such portion of the Registrable Securities requested by the Investor
for an offering to be made on a continuous basis pursuant to Rule 415. Each
Registration Statement shall be on Form S-3 or any successor form thereto
(except if the Company is not then eligible to register for resale the
Registrable Securities on Form S-3 or any successor form thereto, in which case
such registration shall be on another appropriate form in accordance with the
Securities Act and the

 

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Exchange Act) and shall contain (except if otherwise directed by the Investor or
requested by the SEC) the “Plan of Distribution” in substantially the form
attached hereto as Exhibit C. The Company shall not be obligated to file and
have declared effective more than two (2) Registration Statements per year
pursuant to this Article VI and each registration hereunder shall include
Registrable Securities consisting of not less than 600,000 shares of Common
Stock (as adjusted by any stock split, dividend or other distribution,
recapitalization or similar event).

(b) The Company shall use its commercially reasonable efforts to cause each
Registration Statement to be declared effective by the SEC as promptly as
practical after the filing thereof, and, subject to Section 6.1(e), shall use
its commercially reasonable efforts to keep each Registration Statement
continuously effective under the Securities Act for all Registrable Securities
for a period up to the earlier of seventy five (75) days or until the date that
all Registrable Securities covered by such Registration Statement have been sold
or can be sold publicly under Rule 144 on a single day (the “Effectiveness
Period”).

(c) The Company shall notify the Investor in writing promptly (and in any event
within two (2) Trading Days) after receiving notification from the SEC that a
Registration Statement has been declared effective.

(d) The Company may require the Investor to provide such information regarding
the Investor as may be required under the Securities Act to effect the
registration contemplated hereunder.

(e) If at any time after a Registration Statement has become effective, the
Company is engaged in any plan, proposal or agreement with respect to any
financing, acquisition, recapitalization, reorganization or other material
transaction or development the public disclosure of which would be detrimental
to the Company, then the Company may direct that such request be delayed or that
use of the Prospectus contained in such Registration Statement be suspended, as
applicable, for a period of up to 45 days. The Company will notify the Investor
of the delay or suspension. In the case of notice suspending an effective
Registration Statement, the Investor will immediately discontinue any sales of
Registrable Securities pursuant to such Registration Statement until the
Investor has received copies of a supplemented or amended Prospectus or until
the Investor is advised in writing by the Company that the then-current
Prospectus may be used and has received copies of any additional or supplemental
filings that are incorporated or deemed incorporated by reference in such
Prospectus. The Company may exercise the rights provided by this Section 6.1(e)
for an aggregate of 90 days within any 365-day period.

(f) The Company will use its commercially reasonable efforts to cooperate with
the Investor in the disposition of the Registrable Securities covered by a
Registration Statement.

 

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6.2 Registration Procedures. In connection with the Company’s registration
obligations hereunder, the Company shall:

(a) (i) Prepare and file with the SEC such amendments, including post-effective
amendments, to each Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep each Registration Statement continuously
effective, as to the applicable Registrable Securities for the Effectiveness
Period and prepare and file with the SEC such additional Registration Statements
in order to register for resale under the Securities Act all of the Registrable
Securities during the Effectiveness Period; (ii) cause the related Prospectus to
be amended or supplemented by any required Prospectus supplement, and as so
supplemented or amended to be filed pursuant to Rule 424; (iii) respond as
promptly as reasonably practical, to any comments received from the SEC with
respect to each Registration Statement or any amendment thereto; and (iv) comply
in all material respects with the provisions of the Securities Act and the
Exchange Act applicable to the Company with respect to the disposition of all
Registrable Securities covered by a Registration Statement during the applicable
period in accordance with the intended methods of disposition by the Investor
thereof set forth in a Registration Statement as so amended or in such
Prospectus as so supplemented.

(b) Notify the Investor as promptly as reasonably practical, and confirm such
notice in writing no later than two (2) Trading Days thereafter, of any of the
following events: (i) any Registration Statement or any post-effective amendment
is declared effective; (ii) the Company becomes aware that the SEC has issued
any stop order suspending the effectiveness of any Registration Statement or
initiates any Proceedings for that purpose; (iii) the Company receives notice of
any suspension of the qualification or exemption from qualification of any
Registrable Securities for sale in any jurisdiction, or the initiation or threat
of any Proceeding for such purpose; or (iv) the financial statements included in
any Registration Statement become ineligible for inclusion therein or any
Registration Statement or Prospectus or other document contains any untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

(c) Use its commercially reasonable efforts to avoid the issuance of or, if
issued, obtain the withdrawal of (i) any order suspending the effectiveness of
any Registration Statement, or (ii) any suspension of the qualification (or
exemption from qualification) of any of the Registrable Securities for sale in
any jurisdiction, as soon as possible.

(d) If requested by the Investor, promptly provide the Investor, without charge,
at least one conformed copy of each Registration Statement and each amendment
thereto, including financial statements and schedules, and all exhibits to the
extent requested by the Investor (including those previously furnished or
incorporated by reference) promptly after the filing of such documents with the
SEC.

(e) Promptly deliver to the Investor, without charge, as many copies of the
Prospectus or Prospectuses (including each form of prospectus) and each
amendment or supplement thereto as the Investor may reasonably request. The
Company hereby consents to the use of such Prospectus and each amendment or
supplement thereto by the Investor in connection with the offering and sale of
the Registrable Securities covered by such Prospectus and any amendment or
supplement thereto to the extent permitted by federal and state securities laws
and regulations.

 

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(f) Prior to any public offering of Registrable Securities, use its commercially
reasonable efforts to register or qualify or cooperate with the Investor in
connection with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for offer and sale
under the securities or Blue Sky laws of such jurisdictions within the United
States as the Investor requests in writing, to keep each such registration or
qualification (or exemption therefrom) effective for so long as required, but
not to exceed the duration of the Effectiveness Period, and to do any and all
other acts or things reasonably necessary or advisable to enable the disposition
in such jurisdictions of the Registrable Securities covered by a Registration
Statement; provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a foreign corporation
or as a dealer in securities in any jurisdiction in which it is not so qualified
or to subject itself to taxation in respect of doing business in any
jurisdiction in which it is not otherwise so subject.

(g) Upon sale of such Registrable Securities pursuant to an effective
Registration Statement, cooperate with the Investor to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be delivered to a transferee, which certificates shall be free, to the extent
permitted by this Agreement and under Applicable Law, of all restrictive
legends, and to enable such Registrable Securities to be in such denominations
and registered in such names as any the Investor may reasonably request.

(h) Promptly upon the occurrence of any event described in Section 6.2(b)(iv),
prepare a supplement or amendment, including a post-effective amendment, to a
Registration Statement or a supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by reference, and file any
other required document so that, as thereafter delivered, neither such
Registration Statement nor such Prospectus will contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.

(i) Comply with all rules and regulations of the SEC applicable to the Company
in connection with the registration of the Securities.

(j) The Company shall comply with all applicable rules and regulations of the
SEC under the Securities Act and the Exchange Act, including, without
limitation, Rule 172 under the Securities Act, file any final Prospectus,
including any supplement or amendment thereof, with the SEC pursuant to Rule 424
under the Securities Act, promptly inform the holders in writing if, at any time
during the Effectiveness Period, the Company does not satisfy the conditions
specified in Rule 172 and, as a result thereof, the holders are required to make
available a Prospectus in connection with any disposition of Registrable
Securities and take such other actions as may be reasonably necessary to
facilitate the registration of the Registrable Securities hereunder.

6.3 Registration Expenses. The Company shall pay all fees and expenses incident
to the performance of or compliance with Article VI of this Agreement, but
excluding underwriting discounts and commissions of the Investor, including
without limitation (a) all registration and filing fees and expenses, including
without limitation those related to filings with the SEC, any Trading Market and
in connection with applicable state securities or Blue Sky laws, (b) printing
expenses (including without limitation expenses of printing certificates for
Registrable

 

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Securities), (c) messenger, telephone and delivery expenses incurred by the
Company, (d) fees and disbursements of counsel for the Company, (e) fees and
expenses of all other Persons retained by the Company in connection with the
consummation of the transactions contemplated by this Agreement, (f) reasonable
fees and expenses of one special counsel for the Investor (not to exceed $75,000
per registration or $250,000 in the aggregate for all registrations pursuant to
this Agreement); and (g) all listing fees to be paid by the Company to the
Trading Market.

6.4 Indemnification.

(a) Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement, indemnify and hold harmless the Investor, the
officers, directors, partners, members, agents and employees of each of them,
each Person who controls the Investor (within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act) and the officers, directors,
partners, members, agents and employees of each such controlling Person, to the
fullest extent permitted by Applicable Law, from and against all Losses arising
out of or relating to any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, any Prospectus or any form of Company
prospectus or in any amendment or supplement thereto or in any Company
preliminary prospectus, or arising out of or relating to any omission or alleged
omission of a material fact required to be stated therein or necessary to make
the statements therein (in the case of any Prospectus or form of prospectus or
supplement thereto, in the light of the circumstances under which they were
made) not misleading, provided, however, that the Company shall not be liable in
any such case to the extent that such Losses arise out of, or are based upon, an
untrue statement or omission or alleged untrue statement or omission made in
such Registration Statement in reliance upon and in conformity with information
that relates solely to the Investor or the Investor’s proposed method of
distribution of Registrable Securities and was provided by the Investor in
writing for use in such Registration Statement, such Prospectus or such form of
Prospectus or in any amendment or supplement thereto.

(b) Indemnification by the Investor. The Investor shall, notwithstanding any
termination of this Agreement, indemnify and hold harmless the Company, its
officers, directors, partners, members, agents and employees of each of them,
each Person who controls the Company (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act), and the officers, directors,
partners, members, agents and employees of each such controlling Person, to the
fullest extent permitted by Applicable Law, from and against all Losses arising
out of any untrue statement of a material fact contained in any Registration
Statement, any Prospectus or any form of Company prospectus or in any amendment
or supplement thereto or in any Company preliminary prospectus, or arising out
of or relating to any omission or alleged omission of a material fact required
to be stated therein or necessary to make the statements therein (in the case of
any Prospectus or form of prospectus or supplement thereto, in the light of the
circumstances under which they were made) not misleading, in each case, on the
effective date thereof, but only to the extent that such untrue statement or
omission is based solely upon information regarding the Investor furnished to
the Company by the Investor in writing expressly for use therein, or to the
extent that such information solely relates to the Investor or the Investor’s
proposed method of distribution of Registrable Securities and was provided by
the Investor for use in such Registration Statement, such Prospectus or such
form of Prospectus or in any amendment or supplement thereto. In no event shall
the liability of the Investor under this Article VI be greater in amount than
the dollar amount of the net proceeds received by the Investor upon the sale of
the Registrable Securities giving rise to such indemnification obligation.

 

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(c) Conduct of Indemnification Proceedings. If any Proceeding shall be brought
or asserted against any Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party shall promptly notify the Person from whom
indemnity is sought (the “Indemnifying Party”) in writing, and the Indemnifying
Party shall assume the defense thereof, including the employment of counsel
reasonably satisfactory to the Indemnified Party and the payment of all
reasonable fees and expenses incurred in connection with defense thereof;
provided that the failure of any Indemnified Party to give such notice shall not
relieve the Indemnifying Party of its obligations or liabilities pursuant to
this Agreement, except (and only) to the extent that such failure shall have
materially and adversely prejudiced the Indemnifying Party. An Indemnified Party
shall have the right to employ separate counsel in any such Proceeding and to
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Party or Parties unless: (i) the
Indemnifying Party has agreed in writing to pay such fees and expenses; (ii) the
Indemnifying Party shall have failed promptly to assume the defense of such
Proceeding; or (iii) the named parties to any such Proceeding (including any
impleaded parties) include both such Indemnified Party and the Indemnifying
Party, and such Indemnified Party shall have been advised by counsel that a
conflict of interest is likely to exist if the same counsel were to represent
such Indemnified Party and the Indemnifying Party or that additional or
different defenses may be available to the Indemnified Party (in which case, if
such Indemnified Party notifies the Indemnifying Party in writing that it elects
to employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense thereof and
the reasonable fees and expenses of separate counsel shall be at the expense of
the Indemnifying Party), it being understood, however, that the Indemnifying
Party shall not, in connection with any one such Proceeding (including separate
Proceedings that have been or will be consolidated before a single judge) be
liable for the fees and expenses of more than one separate firm of attorneys at
any time for all Indemnified Parties. The Indemnifying Party shall not be liable
for any settlement of any such Proceeding effected without its written consent,
unless such consent is unreasonably withheld or delayed. No Indemnifying Party
shall, without the prior written consent of the Indemnified Party, effect any
settlement of any pending Proceeding in respect of which any Indemnified Party
is a party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability on claims that are the subject matter of
such Proceeding. All reasonable fees and expenses of the Indemnified Party
(including reasonable fees and expenses to the extent incurred in connection
with investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Section 6.4(c)) shall be paid to the Indemnified Party,
as incurred, within twenty (20) Trading Days of written notice thereof to the
Indemnifying Party (regardless of whether it is ultimately determined that an
Indemnified Party is not entitled to indemnification hereunder; provided that
the Indemnifying Party shall reimburse all such fees and expenses to the extent
it is finally judicially determined that such Indemnified Party is not entitled
to indemnification hereunder).

 

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(d) Contribution. If a claim for indemnification under Section 6.4(a) or (b) is
unavailable to an Indemnified Party (by reason of public policy or otherwise),
then each Indemnifying Party, in lieu of indemnifying such Indemnified Party,
shall contribute to the amount paid or payable by such Indemnified Party as a
result of such Losses, in such proportion as is appropriate to reflect the
relative fault of the Indemnifying Party and Indemnified Party in connection
with the actions, statements or omissions that resulted in such Losses as well
as any other relevant equitable considerations. The relative fault of such
Indemnifying Party and Indemnified Party shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission of a
material fact, has been taken or made by, or relates to information supplied by,
such Indemnifying Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission. The amount paid or payable by a party as a result
of any Losses shall be deemed to include, subject to the limitations set forth
in Section 6.4(c), any reasonable attorneys’ or other reasonable fees or
expenses incurred by such party in connection with any Proceeding to the extent
such party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section 6.4(d) was available to such party
in accordance with its terms. The parties hereto agree that it would not be just
and equitable if contribution pursuant to this Section 6.4(d) were determined by
pro rata allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 6.4(d), the Investor
shall not be required to contribute, in the aggregate, any amount in excess of
the amount by which the net proceeds actually received by the Investor from the
sale of the Registrable Securities subject to the Proceeding exceeds the amount
of any damages that the Investor has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
Person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
Person who was not guilty of such fraudulent misrepresentation.

6.5 Dispositions. The Investor agrees that it will comply with the prospectus
delivery requirements of the Securities Act as applicable to it in connection
with sales of Registrable Securities pursuant to a Registration Statement and
shall sell its Registrable Securities in accordance with the Plan of
Distribution set forth in the Prospectus. The Investor further agrees that, upon
receipt of a notice from the Company of the occurrence of any event of the kind
described in Sections 6.2(b)(ii), (iii) or (iv), the Investor will use
commercially reasonable efforts to discontinue disposition of Registrable
Securities under a Registration Statement until the Investor is advised in
writing by the Company that the use of the Prospectus, or amended Prospectus, as
applicable, may be used. The Investor acknowledges and agrees that the
provisions of Section 4.10 of this Agreement shall apply with respect to any
proposed disposition pursuant to a Registration Statement filed pursuant to this
Article VI. The Company may provide appropriate stop orders to enforce the
provisions of this paragraph.

6.6 Assignment of Registration Rights. The registration rights under Article VI
of this Agreement shall be automatically assignable by the Investor to any
transferee of all or any portion of the Investor’s Registrable Securities who is
an Affiliate of the Investor if (i) the Investor agrees in writing with the
transferee or assignee to assign such rights and a copy of such agreement is
furnished to the Company within a reasonable time after such assignment;
(ii) the Company is furnished with written notice of (a) the name and address of
such transferee or assignee, and (b) the securities with respect to which such
registration rights are being transferred or assigned; (iii) following such
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securities by the transferee or assignee is restricted under the Securities Act
and applicable state securities laws; (iv) at or before the time the Company
receives the written notice contemplated by clause (ii) of this sentence the
transferee or assignee agrees in writing to be bound by all of the provisions
contained herein; and (v) such transfer shall have been made in accordance with
the applicable requirements of this Agreement.

6.7 Piggy-Back Registrations. If at any time after the one-year anniversary of
the Closing Date and before the date that the Alliance Agreement is no longer in
effect (i) there is not an effective Registration Statement covering all of the
Registrable Securities, (ii) the Registrable Securities cannot otherwise be sold
under Rule 144, and (iii) the Company shall determine to prepare and file with
the SEC a Registration Statement relating to an offering for its own account or
the account of others under the Securities Act of any of its equity securities,
other than on Form S-4 or Form S-8 (each as promulgated under the Securities
Act) or their then equivalents relating to equity securities to be issued solely
in connection with any acquisition of any entity or business or equity
securities issuable in connection with stock option or other employee benefit
plans, then the Company shall send to the Investor not then eligible to sell all
of its Registrable Securities under Rule 144 in any three-month period written
notice of such determination and if, within ten (10) days after receipt of such
notice, the Investor shall so request in writing, the Company shall include in
such Registration Statement all or any part of such Registrable Securities the
Investor requests to be registered. Notwithstanding the foregoing, in the event
that, in connection with any underwritten public offering, the managing
underwriter(s) thereof shall impose a limitation on the number of shares which
may be included in a Registration Statement because, in such underwriter(s)’
judgment, marketing or other factors dictate such limitation is necessary to
facilitate public distribution, then the Company shall be obligated to include
in such Registration Statement only such limited portion of the Registrable
Securities with respect to which the Investor has requested inclusion hereunder
as the underwriter shall permit. If an offering in connection with which the
Investor is entitled to registration under this Section 6.7 is an underwritten
offering, then the Investor whose Registrable Securities are included in such
Registration Statement shall, unless otherwise agreed by the Company, offer and
sell such Registrable Securities in an underwritten offering using the same
underwriter or underwriters and, subject to the provisions of this Agreement, on
the same terms and conditions as other shares of Preferred Stock and Common
Stock included in such underwritten offering and shall enter into an
underwriting agreement in a form and substance reasonably satisfactory to the
Company and the underwriter or underwriters.

6.8 “Market Stand-Off” Agreement. For so long as the Investor and/or any
Investor Controlled Entity, Parent Entity, Affiliate of the Investor or any 13D
Group of which the Investor or any of its Affiliates is a member collectively
owns at least 5% of the voting power of the Company, the Investor agrees that
neither the Investor, nor any Investor Controlled Entity, Parent Entity,
Affiliate of the Investor or any 13D Group of which the Investor or any of its
Affiliates is a member shall, to the extent requested by the Company or an
underwriter of securities of the Company, sell, transfer, make any short sale
of, grant any option for the purchase of, or enter into any hedging or similar
transaction with the same economic effect as a sale, any Common Stock (or other
securities) of the Company held by such Person for a period specified by the
representative of the underwriters of Common Stock (or other securities) of the
Company not to exceed ninety (90) days (which period may be extended upon the
request of the managing underwriter, to the extent required by any FINRA rules,
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to seventeen (17) days if the Company issues or proposes to issue an earnings or
other public release within seventeen (17) days of the expiration of the 180-day
lockup period) following the effective date of any registration statement of the
Company filed under the Securities Act other than a Registration Statement filed
pursuant to Section 6.1; provided that all officers and directors of the Company
enter into similar agreements. The obligations described in this Section 6.8
shall not apply to a registration relating solely to employee benefit plans on
Form S-8 or similar forms that may be promulgated in the future, or a
registration relating solely to a Commission Rule 145 transaction on Form S-4 or
similar forms that may be promulgated in the future. The Investor further agrees
to execute (and cause any Investor Controlled Entity, Parent Entity, Affiliate
of the Investor or any 13D Group of which the Investor or any of its Affiliates
is a member to execute) such agreements as may be reasonably requested by the
underwriters in connection with such registration that are consistent with this
Section 6.8 or that are necessary to give further effect thereto. The Investor
agrees that the Company may instruct its transfer agent to place stop-transfer
notations in its records to enforce the provisions of this Section 6.8.

ARTICLE VII

PURCHASE RIGHTS

7.1 Subsequent Offerings. Subject to the provisions of Section 4.9(a) other than
Section 4.9(a)(viii) and as permitted under Applicable Law, the Investor will
have the right of first refusal (the “Purchase Rights”) to purchase, on the same
terms as other investors, equity securities, securities convertible into equity
securities, or options or warrants therefor (“Equity Securities”) that the
Company proposes to offer, other than the securities excluded by Section 7.5
hereof, to maintain the proportionate ownership in the Company that the Investor
owned prior to such offering.

7.2 Exercise of Rights. If the Company proposes to issue any Equity Securities,
it shall give the Investor written notice of its intention, describing the
Equity Securities, the price and the terms and conditions upon which the Company
proposes to issue the same. The Investor shall have fifteen (15) days from the
giving of such notice to elect to purchase its pro rata share (based on the
number of shares of Common Stock owned by it in relation to the number of shares
of Common Stock owned by all stockholders of the Company) of Equity Securities
for the price and upon the terms and conditions specified in the notice by
giving written notice to the Company and stating therein the quantity of such
Equity Securities to be purchased.

7.3 Issuance of Equity Securities to Other Persons. If the Investor fails to
exercise in full its Purchase Rights, the Company shall have ninety (90) days
thereafter to sell the Equity Securities in respect of which the Investor’s
rights were not exercised, at a price and upon general terms and conditions no
more favorable to the purchasers thereof than specified in the Company’s notice
to the Investor pursuant to Section 7.2 hereof. If the Company has not sold such
Equity Securities within such ninety (90) days, the Company shall not thereafter
issue or sell any Equity Securities, without first again complying with this
Article VII. Such 90-day period shall be automatically extended in the event
that the proposed issuance is delayed due to regulatory review or for similar
reasons.

 

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7.4 Transfer of Purchase Rights. The Purchase Rights of the Investor under this
Article VII may be transferred to any Affiliate of the Investor; provided that
such Affiliate agrees in writing to be subject to the terms and conditions of
this Agreement.

7.5 Excluded Securities. The Purchase Rights established by this Article VII
shall have no application to any of the following issuances of Equity Securities
(collectively, the “Excluded Securities”):

(a) shares of Common Stock or options, restricted stock units or other equity
securities issued or issuable to employees, directors or consultants pursuant to
equity holder plans maintained by the Company and registered with the SEC on
Form S-8;

(b) shares of Common Stock issued or issuable upon the exercise or conversion of
currently outstanding options, warrants, or convertible securities;

(c) shares of Common Stock issued or issuable on the exercise of the Warrants;
or

(d) shares of Common Stock issued or issuable solely as consideration for bank
financings, equipment leases, investor relations/public relations services,
business acquisitions, mergers or strategic partnerships, and not for financing
purposes;

provided that, subject to Section 4.9(a), nothing else in this Agreement shall
prevent the Investor from purchasing additional shares of Common Stock in open
market transactions to maintain or buy back up to the beneficial ownership in
the Company (not to exceed 15.2% of the Company’s outstanding shares of Common
Stock) that the Investor beneficially owned immediately prior to such
transactions listed in (a) through (d) above.

7.6 Stockholder Approval. Nothing in contained in this Article VII shall require
the Company to issue any Equity Securities to the Investor if such issuance
would require the Company to obtain stockholder approval of the issuance
pursuant to the rules of any Trading Market or under Applicable Law.

7.7 Period. The foregoing provisions of this Article VII shall expire upon the
earlier of (a) the date that the Alliance Agreement is no longer in effect plus,
in the event that the Company chooses not to renew the Alliance Agreement, a
period of twelve months from the date that the Company provides notice to the
Investor of such intention not to renew or (b) the date that the Investor, any
Investor Controlled Entity, any Parent Entity, any Affiliate of the Investor
(other than any officer or director of the Investor and/or Parent) or any 13D
Group of which the Investor or any of its Affiliates is a member collectively
beneficially own less than 5% of the outstanding Common Stock for a period of at
least ninety consecutive days.

 

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ARTICLE VIII

MISCELLANEOUS

8.1 Termination. This Agreement may be terminated by the Company or the
Investor, by written notice to the other, if the Closing has not been
consummated by the third Business Day following the date of this Agreement;
provided that no such termination will affect the right of any party to sue for
any breach by the other party (or parties).

8.2 Fees and Expenses. The Company shall pay all Transfer Agent fees, stamp
taxes and other taxes and duties levied in connection with the sale and issuance
of the Securities.

8.3 Entire Agreement. The Transaction Documents and the non-disclosure agreement
dated October 15, 2007 and amended as of April 1, 2008 between the Company and
the Investor, together with the exhibits and schedules thereto, contain the
entire understanding of the parties with respect to the subject matter hereof
and supersede all prior agreements and understandings, oral or written, with
respect to such matters, which the parties acknowledge have been merged into
such documents, exhibits and schedules.

8.4 Notices. Any and all notices or other communications or deliveries required
or permitted to be provided hereunder shall be in writing and shall be deemed
given and effective on the earliest of (a) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in this Section 8.4 prior to 6:30 p.m. (New York City time) on a
Trading Day, (b) the next Trading Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in this Section 8.4 on a day that is not a Trading Day or later than
6:30 p.m. (New York City time) on any Trading Day, (c) the Trading Day following
the date of deposit with a nationally recognized overnight courier service, or
(d) upon actual receipt by the party to whom such notice is required to be
given. The addresses, facsimile numbers for such notices and communications are
as follows:

Notices for the Company:

Concur Technologies, Inc.

18400 NE Union Hill Road

Redmond, WA 98052

Attention: Chief Legal Officer

Telephone No.: (425) 497-7384

Facsimile No.:  (425) 497-5930

 

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With a copy to:

Fenwick & West LLP

801 California Street

Mountain View, CA 94041

Attention: Robert Freedman and Horace Nash

Telephone No.: (650) 988-8500

Facsimile No.:  (650) 938-5200

Notices for the Investor:

American Express Travel Related Services Company, Inc.

American Express Tower

200 Vesey Street

Maildrop 50-04

New York, NY 10285

Attention: Gilbert Ahye

Telephone No.: (212) 640-2000

Facsimile No.:  (212) 640-0136

With a copy to:

Ropes & Gray LLP

One International Place

Boston, MA 02110

Attention: Alfred O. Rose

Telephone No.: (617) 951-7000

Facsimile No.:  (617) 951-7050

8.5 Amendments; Waivers. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by the
Company and the Investor. No waiver of any default with respect to any
provision, condition or requirement of this Agreement shall be deemed to be a
continuing waiver in the future or a waiver of any subsequent default or a
waiver of any other provision, condition or requirement hereof, nor shall any
delay or omission of either party to exercise any right hereunder in any manner
impair the exercise of any such right.

 

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8.6 Construction. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party.

8.7 Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns. The
Company may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the Investor. The Investor may assign its
rights under this Agreement to any Affiliate of the Investor, provided (i) the
Investor agrees in writing with the transferee or assignee to assign such rights
and a copy of such agreement is furnished to the Company within a reasonable
time after such assignment; (ii) the Company is furnished with written notice of
(a) the name and address of such transferee or assignee, and (b) the Registrable
Securities with respect to which such rights are being transferred or assigned;
(iii) following such transfer or assignment, the further disposition of such
securities by the transferee or assignee is restricted under the Securities Act
and applicable state securities laws; (iv) at or before the time the Company
receives the written notice contemplated by clause (ii) of this sentence the
transferee or assignee agrees in writing to be bound by all of the provisions
contained herein; and (v) such transfer shall have been made in accordance with
the applicable requirements of this Agreement. Notwithstanding the foregoing,
nothing in this Section 8.7 shall prevent any assignment of this Agreement by
the Company or the Investor that is deemed to occur in connection with a Change
of Control of the Company or a Change of Control of the Investor.

8.8 No Third-Party Beneficiaries. This Agreement is intended for the benefit of
the parties hereto and their respective successors and permitted assigns and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person, except that (i) each Indemnified Party is an intended third party
beneficiary of Section 6.4 and (in each case) may enforce the provisions of such
Section 6.4 directly against the parties with obligations thereunder and
(ii) the Investor Director is an intended third party beneficiary of
Section 4.14 and Section 4.15 and (in each case) may enforce the provisions of
such Section 4.14 and Section 4.15 directly against the parties with obligations
thereunder.

8.9 Governing Law; Venue; Service of Process; Waiver of Jury Trial. ALL
QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION
OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THAT BODY OF LAWS PERTAINING
TO CONFLICT OF LAWS. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK,
BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED
HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS), AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO

 

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ASSERT IN ANY SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY
SUBJECT TO THE JURISDICTION OF ANY SUCH COURT AND THAT SUCH SUIT, ACTION OR
PROCEEDING IS IMPROPER. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF
PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR
PROCEEDING BY MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR
OVERNIGHT DELIVERY (WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN
EFFECT FOR NOTICES TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL
CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING
CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS
IN ANY MANNER PERMITTED BY LAW. THE COMPANY AND INVESTOR HEREBY WAIVE ALL RIGHTS
TO A TRIAL BY JURY.

8.10 Survival. The representations and warranties contained herein shall expire
on December 31, 2008. The agreements and covenants contained herein shall
survive the Closing in accordance with their respective terms.

8.11 Execution. This Agreement may be executed in two or more counterparts, all
of which when taken together shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission or email attachment, such signature shall create a valid
and binding obligation of the party executing (or on whose behalf such signature
is executed) with the same force and effect as if such facsimile or
email-attached signature page were an original thereof.

8.12 Severability. If any provision of this Agreement is held to be invalid or
unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Agreement shall not in any way be affected or
impaired thereby and the parties will attempt to agree upon a valid and
enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.

8.13 Replacement of Securities. If any certificate or instrument evidencing any
Securities is mutilated, lost, stolen or destroyed, the Company shall promptly
issue or cause to be issued in exchange and substitution for and upon
cancellation thereof, or in lieu of and substitution therefor, a new certificate
or instrument, and the Investor will pay only those costs and expenses that are
customarily charged by or on behalf the Company or the Transfer Agent to any
stockholder of the Company in connection therewith. The Company may require the
execution by the holder thereof of a customary lost certificate affidavit of
that fact and a customary agreement to indemnify and hold harmless the Company
(and Transfer Agent, if applicable) for any losses in connection therewith.

8.14 Remedies. In addition to being entitled to exercise all rights provided
herein or granted by Applicable Law, including recovery of damages, the Investor
and the Company will be entitled to seek specific performance under the
Transaction Documents. The parties agree that monetary damages may not be
adequate compensation for any loss incurred by reason of any

 

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breach of obligations described in the foregoing sentence and hereby agrees to
waive in any action for specific performance of any such obligation (other than
in connection with any action for temporary restraining order) the defense that
a remedy at law would be adequate.

8.15 Adjustments in Share Numbers and Prices. In the event of any stock split,
subdivision, dividend or distribution payable in shares of Common Stock (or
other securities or rights convertible into, or entitling the holder thereof to
receive directly or indirectly shares of Common Stock), combination or other
similar recapitalization or event occurring after the date hereof and prior to
the Closing, each reference in any Transaction Document to a number of shares or
a price per share shall be amended to appropriately account for such event.

[SIGNATURE PAGES TO FOLLOW]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

 

COMPANY:

 

CONCUR TECHNOLOGIES, INC.

By:   /s/ S. Steven Singh Name:   S. Steven Singh Title:   Chief Executive
Officer

Signature Page to Securities Purchase Agreement

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INVESTOR:

 

AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.

By:   /s/ Ed Gilligan Name:   Ed Gilligan Title:   Group President

Signature Page to Securities Purchase Agreement

--------------------------------------------------------------------------------

Exhibits:

 

A    Securities Purchased B    Form of Warrant C    Plan of Distribution D   
Opinion of Company Counsel E-1    Form of Secretary’s Certificate - Company E-2
   Form of Secretary’s Certificate - Investor

 

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EXHIBIT A

SECURITIES PURCHASED

 

Investor

   Common Stock    Warrants    Purchase Price

American Express Travel Related Services Company, Inc.

   6,400,000    1,280,000    $ 251,328,000.00

 

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EXHIBIT B

FORM OF WARRANT

[See attached document.]

 

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EXHIBIT C

PLAN OF DISTRIBUTION

The selling stockholders may, from time to time, sell any or all of their shares
of common stock on any stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. The selling stockholders may use any one or more of the
following methods when selling shares:

 

  •  

ordinary brokerage transactions and transactions in which the broker-dealer
solicits purchasers;

 

  •  

block trades in which the broker-dealer will attempt to sell the shares as agent
but may position and resell a portion of the block as principal to facilitate
the transaction;

 

  •  

purchases by a broker-dealer as principal and resale by the broker-dealer for
its account;

 

  •  

an exchange distribution in accordance with the rules of the applicable
exchange;

 

  •  

privately negotiated transactions;

 

  •  

short sales;

 

  •  

through the writing or settlement of options or other hedging transactions,
whether through an options exchange or otherwise;

 

  •  

broker-dealers may agree with the selling stockholders to sell a specified
number of such shares at a stipulated price per share;

 

  •  

a combination of any such methods of sale; and

 

  •  

any other method permitted pursuant to applicable law.

The selling stockholders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this prospectus.

Broker-dealers engaged by the selling stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the selling stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. The selling stockholders do not expect these commissions and
discounts to exceed what is customary in the types of transactions involved. Any
profits on the resale of shares of common stock by a broker-dealer acting as
principal might be deemed to be underwriting discounts or commissions under the
Securities Act. Discounts, concessions, commissions and similar selling
expenses, if any, attributable to the sale of shares will be borne by a selling
stockholder. The selling stockholders may agree to indemnify any agent, dealer
or broker-dealer that participates in transactions involving sales of the shares
if liabilities are imposed on that person under the Securities Act.

 

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The selling stockholders may from time to time pledge or grant a security
interest in some or all of the shares of common stock owned by them and, if they
default in the performance of their secured obligations, the pledgees or secured
parties may offer and sell the shares of common stock from time to time under
this prospectus after we have filed a supplement to this prospectus under Rule
424(b)(3) or other applicable provision of the Securities Act of 1933
supplementing or amending the list of selling stockholders to include the
pledgee, transferee or other successors in interest as selling stockholders
under this prospectus.

The selling stockholders also may transfer the shares of common stock in other
circumstances, in which case the transferees, pledgees or other successors in
interest will be the selling beneficial owners for purposes of this prospectus
and may sell the shares of common stock from time to time under this prospectus
after we have filed a supplement to this prospectus under Rule 424(b)(3) or
other applicable provision of the Securities Act of 1933 supplementing or
amending the list of selling stockholders to include the pledgee, transferee or
other successors in interest as selling stockholders under this prospectus.

The selling stockholders and any broker-dealers or agents that are involved in
selling the shares of common stock may be deemed to be “underwriters” within the
meaning of the Securities Act in connection with such sales. In such event, any
commissions received by such broker-dealers or agents and any profit on the
resale of the shares of common stock purchased by them may be deemed to be
underwriting commissions or discounts under the Securities Act.

We are required to pay all fees and expenses incident to the registration of the
shares of common stock. We have agreed to indemnify the selling stockholders
against certain losses, claims, damages and liabilities, including liabilities
under the Securities Act.

The selling stockholders have advised us that they have not entered into any
agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their shares of common stock, nor is there
an underwriter or coordinating broker acting in connection with a proposed sale
of shares of common stock by any selling stockholder. If we are notified by any
selling stockholder that any material arrangement has been entered into with a
broker-dealer for the sale of shares of common stock, if required, we will file
a supplement to this prospectus. If the selling stockholders use this prospectus
for any sale of the shares of common stock, they will be subject to the
prospectus delivery requirements of the Securities Act.

The anti-manipulation rules of Regulation M under the Securities Exchange Act of
1934 may apply to sales of our common stock and activities of the selling
stockholders.

 

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EXHIBIT D

OPINION OF COMPANY COUNSEL

[See attached document.]

 

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EXHIBIT E-1

FORM OF SECRETARY’S CERTIFICATE - COMPANY

[See attached document.]

 

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EXHIBIT E-2

FORM OF SECRETARY’S CERTIFICATE - INVESTOR

[See attached document.]

 

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