<PAGE>

                              $2,000,000 Minimum
                              $4,000,000 Maximum

                              DIGITAL RIVER, INC.

               Convertible Non-Yield Bearing Preferred Stock

                                AGENCY AGREEMENT
                                                           September 30, 1996

John G. Kinnard and Company,
 Incorporated
Kinnard Financial Center
920 Second Avenue South
Minneapolis, Minnesota 55402

Ladies and Gentlemen:

   The undersigned, Digital River, Inc., a Minnesota corporation (the
"Company"), confirms its agreement with you, John G. Kinnard and Company,
Incorporated (the "Agent"), subject to the terms and conditions stated
herein, to act as its exclusive agent with respect to the offer and sale of
up to $4,000,000 of Securities (defined below), as follows:

   1.  DESCRIPTION OF OFFERING.  The Company proposes to issue and sell to
"accredited" investors (as defined in Regulation D of Securities Act of 1933
(the "Act")) through the Agent, on a "best efforts" basis, up to $4,000,000
of Securities.  As used herein, "Securities" shall refer to the duly
authorized, non-assessable, shares of Convertible Non-Yield Bearing Preferred
Stock of the Company.  The Securities will have a liquidation preference in
form and substance acceptable to the Agent and will automatically convert on
a one-to-one basis into Common Stock.  Such conversion shall occur at the
time that the Company completes a registered public offering under the Act.

   In connection with a proposed offering of not less that $2,000,000 and not
more than 4,000,000 in Securities pursuant to Regulation D under the Act (the
"Offering"), the Company has prepared a Confidential Private Placement
Memorandum, dated September 26, 1996 (the "Memorandum").  The Memorandum,
including the documents incorporated by reference therein, as delivered in
connection with the Offering, together with any amendments or supplements
thereto, are referred to collectively herein as the "Offering Materials."
Copies of the Offering Materials have been delivered to the Agent for use in
connection with this Offering.

<PAGE>

   2.  REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

   (a)  The Company represents and warrants to, and agrees with, the Agent
that:

      (i)  On the date hereof, and as of each Closing Date (as later
defined), none of the Offering Materials includes or will include any untrue
statement of a material fact or omits or will omit to state any material fact
required to be stated therein, in light of the circumstances under which they
were made, not misleading; provided, however, the Company makes no
representation or warranty as to information contained in or omitted in
reliance upon, and in conformity with, written information furnished to the
Company by or on behalf of the Agent expressly for use in the preparation of
the Memorandum.

      (ii)  No order or communication suspending or preventing, or
threatening to suspend or prevent, the offer and sale of the Securities or
the use of any of the Offering Materials has been issued and no proceeding or
examination that may lead to such order or communication has been instituted
or threatened by the Securities and Exchange Commission (the "Commission") or
any other governmental authority.

      (iii) The Company has been duly organized, is validity existing as a
corporation in good standing under the laws of its state of incorporation,
has the corporate power and authority to own or lease its properties and
conduct its business as described in the Offering Materials.  The Company is
duly qualified to transact business in all jurisdictions in which the conduct
of its business or its ownership or leasing of its properties require such
qualification and the failure so qualify would have a material adverse effect
on the business or financial condition of the Company.

      (iv)  The outstanding shares of capital stock of the Company have been
duly authorized and validly issued and are fully paid and nonassessable.
Prior to each Closing Date, a sufficient number of shares of Common Stock of
the Company to be issued upon the sale of the Securities will have been duly
authorized and reserved for issuance and, when issued upon the sale of the
Securities, will be validly issued, fully paid and nonassessable.  The
Company's Articles of Incorporation, By-laws or any agreement or other
instrument to which the Company is a party or by which the Company is bound
do not contain any preemptive rights or other rights to subscribe for or to
purchase any shares of capital stock of the Company, except such rights as
the holders thereof shall have waived prior to each Closing Date.  The
offering or the sale of the Securities as contemplated by the Offering
Materials does not give rise to any such rights, except those which will have
been validly waived or satisfied prior to each Closing Date.  Except as
described in the Offering Materials and except for stock options, warrants or
convertible securities which as of the date hereof cover a total of 63,500
shares of Common Stock, there are no outstanding options, warrants,
agreements, contracts or other rights to purchase or acquire from the Company
any shares of its capital stock.  The Company's authorized and outstanding
capital stock as of the first Closing Date will consist of 100,000,000 shares
of capital stock of which

                                       2

<PAGE>

320,000 shares will be designated Convertible Non-Yield Bearing Preferred
Stock.  The Securities and the capital stock of the Company conforms, and the
shares issued upon conversion of the Securities, will conform, to the
descriptions thereof contained in the Offering Materials.

      (v)  The historical financial statements, together with the related
notes thereto, incorporated in the Offering Materials, present fairly the
financial position, results of operations and changes in financial position
of the Company on the basis stated therein at the indicated dates and for the
indicated periods.  Such historical financial statements have been prepared
in accordance with generally accepted accounting principles consistently
applied throughout the periods involved (except as otherwise stated therein),
and all adjustments necessary for a fair presentation of results for such
periods have been made (except as otherwise stated therein).

      (vi)  Except as referred to in the Offering Materials, there is no
action or proceeding pending or, to the knowledge of the Company, threatened
against the Company before any court or administrative or regulatory agency
which, if determined adversely to the Company would, individually or in the
aggregate, result in a material adverse change in the business or financial
condition, results of operations or stockholders' equity of the Company.

      (vii) The Company has good and marketable title to all properties and
assets reflected as owned in the balance sheet dated August 31, 1996, in each
case free and clear of all liens, encumbrances and defects, except as such
are described in the Offering Materials or do not substantially affect the
value of such properties and assets and do not materially interfere with the
use made of such properties and assets by the Company and such as have been
sold in the ordinary course of the Company's business since August 31, 1996;
and any real property and buildings held under lease by the Company are held
by it under valid, subsisting and enforceable leases with such exceptions as
are not material and do not materially interfere with the use made of such
property and buildings by the Company.

     (viii) Since the respective dates as of which information is given in
the Offering Materials except that the Company has continued to incur losses
and except as otherwise described in or contemplated by the Offering
Materials (A) there has not been any material adverse change in or affecting
the condition, financial or otherwise, of the Company or the business
affairs, management, financial position, stockholders' equity, or results of
operations of the Company, whether or not occurring in the ordinary course of
business, (B) there has not been any material transaction not in the ordinary
course of business entered into by the Company, (C) the Company has not
incurred any material liabilities or obligations which are not in the
ordinary course of business, (D) the Company has not sustained any material
loss or interference with their businesses or properties from fire, flood,
windstorm, accident or other calamity, whether or not covered by insurance,
(E) there has not been any declaration or payment of any dividends or
distribution of any kind with

                                        3


<PAGE>

respect to the capital stock of the Company, any change in the capital stock
of the Company other than pursuant to the exercise of outstanding options and
warrants, or any material increase in the short-term or long-term debt
(including capitalized lease obligations) of the Company, or (F) there has
not been any issuance of warrants, options, convertible securities or other
rights to purchase or acquire capital stock of the Company (other than the
issuance of shares of Common Stock or options pursuant to the Company's stock
option plans).

      (ix)  The Company is not in violation of, or in default under, its
Articles of Incorporation or By-laws, or any statute, or any rule,
regulation, order, judgment, decree or authorization of any governmental or
administrative agency, court or other body having jurisdiction over the
Company or any of its properties, or any indenture, mortgage, deed of trust,
loan agreement, lease, franchise, license or other agreement or instrument to
which the Company is a party or by which it is bound or to which any property
or assets of the Company are subject, which violation or default would have a
material adverse effect on the business, financial condition, results of
operations or stockholders' equity of the Company.

      (x)   The issuance and sale of the Securities by the Company and the
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated herein by the Company in accordance with the
terms hereof will not violate any provision of the Articles of Incorporation
or By-laws of the Company or any statute, or any rule, regulation, order,
judgment, decree or authorization of any court or governmental or
administrative agency or body having jurisdiction over the Company or any of
its properties, and will not conflict with, result in a breach or violation
of, or constitute, either by itself or upon notice or passage of time or
both, a default under any indenture, mortgage, deed of trust, loan agreement,
lease, franchise, license or other agreement or instrument to which the
Company is a party or by which the Company is bound or to which any property
or assets of the Company are subject.  Except for such approvals or consents
as have been obtained, no approval, consent, order, authorization,
designation, declaration or filing by or with any court or governmental
agency or body, including Fujitsu Limited, or other entity, is required for
the execution and delivery by the Company of this Agreement and the
consummation of the transactions herein contemplated in the manner herein
contemplated, except those (not including those involving Fujitsu Limited)
which would not have a material adverse effect on the Company if not obtained.

      (xi)  The Company holds and is operating in compliance with all
licenses, approvals, certificates and permits from governmental and
regulatory authorities, foreign and domestic, which are necessary to the
conduct of its business as now conducted as described in the Offering
Materials, except where the failure to hold such licenses, approvals,
certificates or permits or failure so to be in compliance would not have a
material adverse effect on the business, financial condition, results of
operations or stockholders' equity of the Company.

                                        4

<PAGE>

      (xii)  The Company has the corporate power and authority to enter into
this Agreement and to authorize, issue and sell the Securities, as
contemplated in this Agreement.  Prior to the Final Closing Date (as later
defined), this Agreement will have been duly and validly authorized, executed
and delivered by the Company, and will be the valid and binding obligations
of the Company, enforceable in accordance with its terms, except to the
extent the rights to indemnity and contribution provided for in this
Agreement may be limited by applicable federal securities laws, and except to
the extent enforceability of this Agreement may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws of
general application affecting creditors' rights generally, and by general
principles of equity.

     (xiii)  Runbeck & Associates, P.A., which has audited certain of the
financial statements incorporated in the Offering Materials, are independent
public accountants within the meaning of Rule 2-01 of Regulation S-X
promulgated under the Act.

      (xiv)  The Company has not distributed and will not distribute any
private placement memoranda or other offering material in connection with the
offering and sale of the Securities, other than the Offering Materials.
Except as previously disclosed to the Agent, the Company has not sold or
offered for sale (directly or indirectly) the Securities other than through
the Agent and has not participated in any form of general solicitation or
general advertising for the Securities, including but not limited to any
advertisement, article, notice or other communication published in any
newspaper, magazine or similar media or broadcast over television, radio or
other electronic media, or conducted or participated in any seminar or
meeting whose attendees have been invited by any general solicitation or
general advertising.

      (xv)   The Company owns, licenses or has contractual rights with
respect to all patents, patent applications, trademarks, service marks,
trade names, trademark registrations, service mark registrations, copyrights,
licenses, inventions, trade secrets, know how and other similar rights
necessary for the conduct of its business as currently conducted and as
described in the Offering Materials, except where the failure so to own or
license the foregoing would not have a material adverse effect on the
Company.  The Company has no knowledge of any infringement or misappropriation
by any third parties, or conflict with, any of the Company's intellectual
property rights, nor has the Company received any notice of any infringement,
misappropriation or violation by the Company of any intellectual property
rights of any third parties.  Except as disclosed in the Offering Materials,
not claim by any third party contesting the validity of any of the Company's
intellectual property rights has been made, is currently outstanding or, to
the knowledge of the Company, is threatened.

      (xvi)  Other than as contemplated by this Agreement, the Company has
not incurred any liability for any finder's or broker's fee or agent's
commission in

                                        5

<PAGE>

     connection with the execution and delivery of this Agreement or the
     consummation of the transactions contemplated hereby.

          (xvii) Assuming compliance by the Agent with the terms of this
     Agreement, the offer and sale of the Securities will not be required to
     be registered under the Act.

          (xviii) The Agent's Warrant (as defined below) and prior to each
     Closing Date the shares of Common Stock to be issued upon exercise of
     the Agent's Warrant (the "Warrant Shares") have been duly authorized.
     The Agent's Warrant, when issued and delivered, will constitute valid
     and binding obligations of the Company in accordance with their terms,
     except as enforceability may be limited by the application of
     bankruptcy, insolvency, moratorium or similar laws affecting the rights
     of creditors generally and by judicial limitations on the right of
     specific performance. The Warrant Shares, when issued in accordance the
     terms of the Agent's Warrant, will be fully paid and nonassessable, and
     subject to no preemptive rights or similar rights on the part of any
     person or entity. Prior to each Closing Date, a sufficient number of
     shares of Common Stock has been reserved for issuance by the Company
     upon exercise of the Agent's Warrant.

          (xix) The Company has filed all necessary federal and state income
     and franchise tax returns and paid all taxes shown as due thereon. The
     Company has no knowledge of any tax deficiency which might be asserted
     against it which would materially and adversely affect the Company's
     business or properties.

     (b)  Any certificate signed by any officer of the Company and delivered
to the Agent or counsel to the Agent shall be deemed to be a representation
and warranty of the Company to the Agent as to the matters covered thereby.

     3.   REPRESENTATIONS AND WARRANTIES OF THE AGENT.

     The Agent represents that:

     (a)  It is not disqualified from acting as a selling agent hereunder
under Regulation D.

     (b)  It is a corporation duly organized, validly existing and in good
standing under the laws of the State of Minnesota with full corporate power
and authority to carry on its business.

     (c)  It is licensed as a broker-dealer, authorized to conduct offerings
of the sort contemplated hereby by the Commission, the Minnesota Department
of Commerce Securities Division and the Blue Sky authorities of each other
state in which the Company and Agent have agreed to offer the Securities and
is a member in good standing of the

                                        6
<PAGE>

National Association of Securities Dealers, Inc., and, to the Agent's best
knowledge, no proceedings are pending or threatened to revoke or limit any
such status.

     (d)  This Agreement has been duly authorized, executed and delivered by
the Agent and is a legal, valid and binding agreement of the Agent
enforceable in accordance with its terms.

     (e)  It will:

          (i)   solicit offers only from accredited investors; and

          (ii)  not offer the Securities for sale to, or sell to, any offeree
     who resides in a state the Blue Sky laws of which require offerees to
     meet specified qualifications unless such offeree meets such
     qualification.

     (f)  The Agent will make offers to sell to, or solicit offers from,
persons only in those states where the Company has qualified or registered
the offering for sale or determined that an exemption from such qualification
or registration is available under the applicable Blue Sky laws.

     4.   BEST EFFORTS PRIVATE OFFERING OF THE SECURITIES.

     (a)  On the basis of the representations, warranties and agreements
herein contained, and subject to the terms and conditions herein set forth,
the Company appoints the Agent as its exclusive agent to effect sales of the
Securities on a "best efforts" basis for the account and risk of the Company,
and the Agent agrees to use its best efforts as such agent to procure
purchasers for such Securities during a period commencing with the date of
this Agreement and ending with the Termination Date (as hereinafter defined)
of this Agreement. The Agent may use the services of other brokers or dealers
in connection with the offer and sale of the Securities and pay any portion
of the Agent's Commission (as hereinafter defined) to such brokers or dealers
who are members of the National Association of Securities Dealers, Inc. and
who agree to abide by the provisions of Section 3 hereof.

     (b)  The Company will pay the Agent, as compensation for its services
hereunder, a cash commission of 10% of the offering price of the Securities
which the Agent shall sell prior to the Termination Date (the "Agent's
Commission"). This amount shall be paid to the Agent at each Closing Date.

     (c)  Upon the closing of the minimum number of shares in the Offering,
the Agent will be granted the right to act as the exclusive selling agent or
underwriter for any public or private offering of any equity or debt
securities of the Company. Such right will expire upon the closing of a
registered public offering of the Company's Common Stock which raises net
proceeds of at least $5,000,000.

                                        7
<PAGE>

     5.   AGENT'S WARRANT. On each Closing Date, the Company will sell to the
Agent a warrant to purchase a number of shares of the Company's Common Stock
equal to ten percent (10%) of the aggregate number of shares of the
Securities sold pursuant to the Offering (that is, warrants to purchase
10,000 shares of Common Stock per 100,000 shares of Convertible Non-Yield
Bearing Preferred Stock sold in the Offering) (the "Agent's Warrant") for
$.001 for each share of Common Stock issuable upon exercise of Agent's
Warrant. The Agent's Warrant shall become exercisable one year from the date
of issuance and shall terminate seven (7) years after issuance. The exercise
price shall be equal to 100% of the per share price at which the Securities
are sold. The Agent's Warrant shall be in a form substantially similar to
Exhibit A attached hereto.

     6.   COVENANTS OF THE COMPANY. The Company covenants and agrees with the
Agent that:

     (a)  The Company will deliver to the Agent or such person as it shall
designate, such quantity of the Offering Materials (as the same may be from
time to time supplemented or amended) as the Agent may reasonably request,
and the Company agrees that no copies of the Memorandum shall be distributed
by it to any other potential purchaser of the Securities.

     (b)  The Company will immediately advise the Agent by telephone,
confirming such advice in writing, of any order or communication suspending
or preventing, or threatening to suspend or prevent, the offer and sale of
the Securities, or of any proceedings or examinations that may lead to such
an order or communication, whether by or of the Commission or any other
regulatory authority, as soon as the Company is advised thereof.

     (c)  From the date hereof until the expiration of the Offering Period,
if any event affecting the Company or of which the Company shall be advised
in writing by the Agent shall occur which, as a result, in the Agent's
opinion would cause the Offering Materials, as then amended or supplemented,
to include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in light of
the circumstances when made, not misleading, or if for any other reason it
shall be necessary at any time to amend or supplement the Offering Materials
to comply with any law, the Company promptly will prepare an appropriate
amendment or supplement to the Offering Materials so that the Offering
Materials, as so amended or supplemented, will not include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in light of the circumstances when it
is so delivered, not misleading, or so that the Offering Materials will
comply with any law. The Company will forthwith, at its own expense, prepare
and furnish to the Agent a reasonable number of copies of a supplement to or
amendment of the Memorandum or the other Offering Materials so that the
Memorandum, as so supplemented or amended, will not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they are made, not misleading, or so that the Memorandum will comply
with law.

                                        8
<PAGE>

     (d)  The Company will not offer or sell the Securities other than
through the Agent or participate in any form of general solicitation or
general advertising for the Securities, including but not limited to any
advertisement, article, notice or other communication published in any
newspaper, magazine or similar media broadcast over television or radio or
other electronic media, or conducted or participated in any seminar or
meeting whose attendees have been invited by any general solicitation or
general advertising.

     (e)  The Company will, for a period of five (5) years following the date
hereof or until the Company completes a registered public offering of its
Common Stock, deliver to the Agent, simultaneously with delivery to the
Company's shareholders, reports, unaudited quarterly and audited yearly
financial statements prepared in accordance with generally accepted
accounting principles and other materials to be provided to shareholders of
the Company.

     7.   COSTS AND EXPENSES. Whether or not the sale of the Securities
contemplated hereby is consummated:

     (a)  The Company will pay or cause to be paid (directly or by
reimbursement) all reasonable costs, expenses and fees of the Company in
connection with the offering and the transactions herein contemplated,
including, but not limited to the costs of preparing the Securities; all
expenses and taxes incident to the issuance and delivery of the Securities;
fees and expenses of legal counsel and independent accountants for the
Company; the costs and expenses incident to the preparation and distribution
of the Offering Materials, and all amendments of and supplements to the
Memorandum and other Offering Materials; and all costs, expenses and fees
incident to the Company's performance of its obligations under this Agreement
which are not specifically provided for in this Section 7. In addition, the
Company will pay all reasonable costs, expenses and fees incident to all
informational "road show" meetings held in connection with the offering,
provided that such expenses are substantially in accordance with the budget
pre-approved by the Company.

     (b)  The Company will reimburse the Agent, up to the maximum amount of
$40,000, for reasonable out-of-pocket expenses incurred by the Agent in
connection with its services rendered hereunder, including travel expenses
and the fees and expenses of Briggs and Morgan, Professional Association,
counsel to the Agent. The Company will promptly reimburse the Agent for the
fees and expenses referred to in this Section upon receipt from the Agent of
an invoice related thereto.

     8.   CONDITIONS TO OBLIGATIONS OF THE AGENT. The Agent's obligation to
act as Agent in connection with the offer and sale of the Securities, the
delivery to the Company of the purchase price for the Securities and the
issuance and delivery of the Securities to the purchasers thereof against
payment therefor, shall be subject to the condition that all representations
and warranties of the Company shall be true and correct at and as of each
Closing Date with the same effect as though made on such date, to the
condition that the Company shall have performed by such date all of its
covenants and obligations hereunder, and to the following conditions:

                                        9
<PAGE>

     (a)  No order or communication suspending or threatening to prevent the
offer and sale of the Securities shall have been issued, and no proceedings
or examinations that may lead to such an order or communication shall be
pending or threatened, by the Commission or by any other regulatory authority.

     (b)  The Agent shall have received on the Final Closing Date the opinion
of Dorsey & Whitney LLP, counsel for the Company, dated the Final Closing
Date, addressed to the Agent, to the effect that:

          (i)   The Company is validly existing as a corporation in good
     standing under the laws of its state of incorporation, with corporate
     power and authority to own or lease its properties and conduct its
     business as described in the Offering Materials.

          (ii)  Upon exercise of the Agent's Warrant, the Warrant Shares
     issuable upon such exercise will be validly issued, fully paid and
     nonassessable. To the knowledge of such counsel, no preemptive or other
     similar subscription rights of stockholders of the Company, exist with
     respect to any of the shares issuable upon exercise of the Agent's
     Warrant which have not been validly exercised or waived prior to the
     sale of the Securities offered pursuant to the Offering Materials. The
     capital stock of the Company conforms in all material respects to the
     description thereof contained in the Offering Materials. A sufficient
     number of shares of Common Stock has been reserved for issuance upon
     exercise of the Agent's Warrant.

          (iii) The Company has the corporate power and authority to execute,
     deliver and perform this Agreement and to authorize, issue and sell the
     Securities as contemplated in this Agreement. The execution and delivery
     of this Agreement and the consummation of the transactions herein
     contemplated do not and will not conflict with or result in a violation
     of or default under the Articles of Incorporation of the Company,
     By-laws of the Company, or any agreements with Fujitsu Limited.

          (iv)  This Agreement, the Securities and the Agent's Warrant have
     been duly authorized, executed and delivered by the Company and are the
     valid and binding obligations of the Company, enforceable in accordance
     with their terms, except as enforceability may be limited by the
     application of bankruptcy, insolvency, moratorium or other laws of
     general application affecting the rights of creditors generally and by
     judicial limitations on the right of specific performance, and other
     equitable remedies, and except as the enforceability of indemnification
     or contribution provisions hereof may be limited by federal or state
     securities laws.

          (v)   The execution, delivery and performance of this Agreement and
     the consummation of the transactions described herein will not result in
     a violation of, or a default under, the terms or provisions of (i) any
     material bond, debenture, note, contract, lease, license, indenture,
     mortgage, deed of trust, loan agreement, joint venture or other
     agreement or instrument of which such counsel has knowledge, to which
     the Company is a party or by which the Company or any of its properties
     are

                                       10
<PAGE>

     bound, or (ii) any material law, order, rule, regulation, writ,
     injunction or decree known to such counsel of any government,
     governmental agency or court having jurisdiction over the Company or any
     of its properties (except as to compliance with Regulation D under the
     Act as to which such counsel needs express no statement).

     In addition to the matters set forth above, such opinion shall also
include a statement to the effect that, although such counsel cannot
guarantee the accuracy, completeness or fairness of any of the statements
contained in the Offering Materials, in connection with such counsel's
representation of the Company in the preparation of the foregoing document or
this transaction, nothing has come to the attention of such counsel which
causes them to believe that the foregoing document (except as to the
financial statements, summary financial data and other financial and
statistical information included in the Offering Materials, as to which such
counsel need express no statement) contains as of the date when made an
untrue statement of a material fact or omits to state a material fact
required to be state therein or necessary to make the statements therein as
of the date when made, in light of the circumstances in which they were made,
not misleading.

     In expressing the foregoing opinion, as to matters of fact relevant to
conclusions of law, counsel may rely, to the extent that they deem proper,
upon certificates of public officials and of the officers of the Company,
provided that copies of such officers' certificates are attached to the
opinion.

     (c)   The Agent shall have received on the Final Closing Date a letter
from Merchant, Gould, Smith, Edell, Welter & Schmidt, Professional
Association, patent, trademark and copyright counsel for the Company, dated
the Final Closing Date, addressed to the Agent, regarding the section of the
Company's Business Plan, dated September 26, 1996, entitled "Patents
Pending," in form and substance acceptable to counsel for the Agent.

     (d)  Subsequent to the execution and delivery of this Agreement and
prior to each Closing Date, there shall not have been any change or any
development involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company, otherwise than as set forth or contemplated in the
Offering Materials, the effect of which, in the Agent's judgment, is material
and adverse to the Company and makes it impracticable or indadvisable to
proceed with the offering or the delivery of the Securities being delivered
at each Closing Date.

     (e)  The Agent shall have received on each Closing Date, a certificate
or certificates of the chief executive officer and the chief financial
officer of the Company to the effect that, as of such Closing Date, each of
them severally represents (in the case of the Chief Financial Officer, to the
best of his knowledge) that the representations and warranties of the Company
set forth in Section 2 of this Agreement are true and correct at and as of
such Closing Date and the Company has performed all of its obligations under
this Agreement to be performed at or prior to such Closing Date.

                                       11

<PAGE>

     (f)  The Company shall have furnished to the Agent such further
certificates and documents as the Agent may reasonably have requested.

     (g)  The opinions and certificates mentioned in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are in all
material respects reasonably satisfactory to the Agent and to Briggs and
Morgan, Professional Association, counsel for the Agent.

     (h)  If any of the conditions hereinabove provided for in this Section 8
shall not have been fulfilled when and as required by this Agreement to be
fulfilled, the obligations of the Agent hereunder may be terminated by the
Agent by notifying the Company of such termination in writing or by telegram at
or prior to the relevant Closing Date.

     9.   INDEMNIFICATION.

     (a)  The Company agrees to indemnify and hold harmless the Agent, each
officer and director thereof, and each person, if any, who controls the Agent
within the meaning of the Act, against any losses, claims, damages or
liabilities to which the Agent or such persons may become subject under the Act
or otherwise, insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Offering Materials including any amendments or supplements thereto, or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein, or necessary to make the
statements therein not misleading in light of the circumstances under which
they were made, and will reimburse the Agent and each such officer, director,
or controlling person in connection with investigating or defending any such
action or claim as such expenses are incurred: provided, however, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement
or alleged untrue statement, or omission or alleged omission, made in the
Offering Materials including any amendments or supplements thereto, in reliance
upon and in conformity with written information furnished to the Company by the
Agent specifically for use therein.

     (b)  The Agent agrees to indemnify and hold harmless the Company, each of
its directors and officers, and each person, if any, who controls the Company
within the meaning of the Act, against any losses, claims, damages or
liabilities to which the Company or any such director, officer or controlling
person may become subject under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in the Offering Materials or any amendments or
supplements thereto, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading in the light of the
circumstances under which they were made, and will reimburse the Company and
each such director, officer, or controlling person in connection with
investigating or defending any such action or claim as such expenses are


                                       12
<PAGE>

incurred; provided, however, that the Agent shall be liable in any such case
to the extent, but only to the extent, that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission has been made in the
Offering Materials including any amendments or supplements thereto in
reliance upon and in conformity with written information furnished to the
Company by or through the Agent and described in Section 9(f) hereof.

     (c)  In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity or
contribution may be sought pursuant to this Section 9, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing.  No
indemnification provided for in Section 9(a) or (b) or contribution provided
for in Section 9(d) shall be available to any party who shall fail to give
notice as provided in this Section 9(c) if the party to whom notice was not
given was unaware of the proceeding to which such notice would have related
and was prejudiced by the failure to give such notice, but the failure to
give such notice shall not relieve the indemnifying party or parties from any
liability which it or they may have to the indemnified party otherwise than
on account of the provisions of Section 9(a), (b) or (d).  In case any such
proceeding shall be brought against any indemnified party and it shall notify
the indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party and shall pay as incurred the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified party
shall have the right to retain its own counsel at its own expense.
Notwithstanding the foregoing, the indemnifying party shall pay as incurred
the reasonable fees and expenses of the counsel retained by the indemnified
party in the event (i) the indemnifying party and the indemnified party shall
have mutually agreed to the retention of such counsel or (ii) the named
parties to any such proceeding (including any impleaded parties) include both
the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them.  It is understood that the indemnifying
party shall not, in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the fees and expenses of more than one
separate firm for all such indemnified parties.  Such firm shall be
designated in writing by the Agent and shall be reasonably satisfactory to
the Company in the case of parties indemnified pursuant to Section 9(a) and
shall be designated in writing by the Company and shall be reasonably
satisfactory to the Agent in the case of parties indemnified pursuant to
Section 9(b).  The indemnifying party shall not be liable for any settlement
of any proceeding effected without its written consent but if settled with
such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment.

     (d)  If the indemnification provided for in this Section 9 is unavailable
or insufficient to hold harmless an indemnified party under Section 9(a) or (b)
in respect of any losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) referred


                                       13
<PAGE>

to therein, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages
or liabilities (or actions or proceedings in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Agent on the other from the offering of the
Securities.  If, however, the allocation provided by the immediately preceding
sentence is not permitted by applicable law, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but
also the relative fault of the Company on the one hand and the Agent on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof), as well as any other relevant equitable considerations.  The relative
benefits received by the Company on the one hand and the Agent on the other
shall be deemed to be in the same proportion as the total net proceeds from the
offering (net of the Agent's commission, but before deducting expenses)
received by the Company bears to the total commissions received by the Agent.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the Agent on the other and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.  The Company and the Agent agree
that it would not be just and equitable if contributions pursuant to this
Section 9(d) were determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this Section 9(d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions or
proceedings in respect thereto) referred to above in this Section 9(d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim.  Notwithstanding the provisions of this Section 9(d), the Agent shall
not be required to contribute any amount in excess of the commissions
applicable to the Securities sold in the offering contemplated hereby; and no
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.

     (e)  The obligations of the Company under this Section 9 shall be in
addition to any liability which the Company may otherwise have, and the
obligations of the Agent under this Section 9 shall be in addition to any
liability which the Agent may otherwise have.

     (f)  For all purposes under this Section 9 and this Agreement (including,
without limitation, Section 9(b) hereof), the Company understands and agrees
with the Agent that it has not furnished any written information to the Company
specifically for use in preparation of the Offering Materials, or any amendment
or supplement thereto, except as set forth in the Memorandum under "Terms of
the Offering -- the Agent."

     10.  CLOSING AND DELIVERY OF SECURITIES.  On each Closing Date, the
Company will deliver to the investors or Agent certificates representing the
number of shares of Securities


                                       14

<PAGE>

sold to investors pursuant to this Offering as reflected in executed
Subscription Agreements against payment therefor. Closings will be held as
agreed to by the Company and the Agent with the last Closing Date (the "Final
Closing Date") being held within seven days of the Termination Date (as
hereinafter defined). However, the Final Closing Date may be accelerated or
extended by agreement between the Company and the Agent. The time and date of
each closing is herein referred to as the "Closing Date."

     11.  EFFECTIVE DATE OF THE AGREEMENT AND TERMINATION.

     (a)  This Agreement is effective as of the date first written above.

     (b)  This Agreement shall terminate one hundred and twenty days (120)
days following the date of this Agreement, subject to a sixty-day extension by
agreement between the Company and the Agent (the "Termination Date"). In
addition, this Agreement may be terminated on or any time prior to the
Termination Date by agreement of the parties, or by the Agent upon written or
telegraphic notice to the Company if: (i) the market value of securities in
general or political, financial or economic conditions shall have so
materially changed as in the Agent's judgment to render it impractical or
inadvisable to proceed with the best efforts offering of the Securities; (ii)
there shall be a material outbreak of hostilities or material escalation and
deterioration in the political and military situation between the United
States and any foreign power or a formal declaration of war by the United
States of America shall have occurred; (iii) trading in Securities on the New
York Stock Exchange or the American Stock Exchange shall have been suspended
or minimum or maximum prices shall have been established in either exchange
by action of such exchange, the Commission or other governmental or
regulatory authority; or (iv) any other restrictions (including, without
limitation, any banking moratorium) on transactions in securities materially
affecting the free market for securities or the payment for such securities
shall have been established by either exchange, by the Commission, by any
other federal or state agency, by action of the Congress or by Executive
Order. Any such termination shall be without liability of any party to any
other party except that the provisions of sections 7, 9 and 15 hereof shall
at times be effective and binding.

     12.  NOTICES.  All communications hereunder shall be in writing and,
except as otherwise provided herein, will be mailed, delivered or telegraphed
and confirmed as follows: if to the Agent, to John G. Kinnard and Company,
Incorporated, Kinnard Financial Center, 920 Second Avenue South, Minneapolis,
Minnesota, 55402, Attention: Joseph A. Radecki; if to the Company, to Digital
River, Inc., 5198 West 76th Street, Edina, Minnesota 55439, Attention: Joel
Ronning.

     13.  SUCCESSORS.  This Agreement has been and is made solely for the
benefit of and shall be binding upon the Agent and the Company and their
respective successors and the officers, directors and controlling persons
referred to herein, and their respective personal representatives and no
other person will have any right or obligation hereunder. The term
"successors" shall not include any purchaser of the Securities merely because
of such purchase.


                                       15
<PAGE>

     14.  BOARD REPRESENTATION.  Following the first Closing Date, Joel
Ronning will exercise his right to appoint an additional member to the
Company's Board of Directors after consultation with the Agent. The Agent's
right to consult with Mr. Ronning regarding representation on the Board of
Directors will continue until the closing of a registered public offering of
Common Stock by the Company.

     15. MISCELLANEOUS.  The reimbursement, indemnification and contribution
agreements contained in this Agreement and the representations, warranties and
covenants in this Agreement shall remain in full force and effect regardless
of (a) any termination of this Agreement, (b) any investigation made by or on
behalf of the Agent or controlling person thereof, or by or on behalf of the
Company or its directors or officers and (c) delivery of and payment for the
Securities under this Agreement. Each provision of this Agreement shall be
interpreted in such a manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable under any applicable law or rule in any jurisdiction, such
provision will be ineffective only to the extent of such invalidity,
illegality or unenforceability in such jurisdiction or any provision hereof
in any other jurisdiction. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. This Agreement shall
be governed by, and construed in accordance with, the laws of the State of
Minnesota.

     If the foregoing letter is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement amount the Company and the Agent
in accordance with its terms.


                                         Very truly yours,

                                         DIGITAL RIVER, INC.

                                         By  /s/ Joel A. Ronning
                                             --------------------------
                                             Joel A. Ronning

                                          Its  President
                                              -------------------------


                                       16
<PAGE>

The foregoing Agency Agreement is
hereby confirmed and accepted as of
the date first above written.

JOHN G. KINNARD AND COMPANY,
INCORPORATED


By  /s/ Joseph A. Radecki
    ------------------------------
     Joseph A. Radecki

Its  Vice President
     --------------------------


                                       17