Document:

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                                                                    EXHIBIT 10.3

                          NEUROCRINE BIOSCIENCES, INC.

                        1996 EMPLOYEE STOCK PURCHASE PLAN

          (AS AMENDED MAY 24, 2001, JUNE 15, 2001 AND NOVEMBER 7, 2005)

      The following constitute the provisions of the 1996 Employee Stock
Purchase Plan of Neurocrine Biosciences, Inc.

      1. Purpose. The purpose of the Plan is to provide employees of the Company
and its Designated Subsidiaries with an opportunity to purchase Common Stock of
the Company through accumulated payroll deductions. It is the intention of the
Company to have the Plan qualify as an "Employee Stock Purchase Plan" under
Section 423 of the Internal Revenue Code of 1986, as amended. The provisions of
the Plan, accordingly, shall be construed so as to extend and limit
participation in a manner consistent with the requirements of that section of
the Code.

      2. Definitions.

            (a) "Board" shall mean the Board of Directors of the Company.

            (b) "Code" shall mean the Internal Revenue Code of 1986, as amended.

            (c) "Common Stock" shall mean the Common Stock of the Company.

            (d) "Company" shall mean Neurocrine Biosciences, Inc. and any
Designated Subsidiary of the Company.

            (e) "Compensation" shall mean all regular straight time gross
earnings but shall exclude variable compensation for field sales personnel,
incentive bonuses, overtime, shift premium, lead pay and automobile allowances
and other compensation.

            (f) "Designated Subsidiaries" shall mean the Subsidiaries which have
been designated by the Board from time to time in its sole discretion as
eligible to participate in the Plan.

            (g) "Employee" shall mean any individual who is an Employee of the
Company for tax purposes whose customary employment with the Company is at least
twenty (20) hours per week and more than five (5) consecutive months in any
calendar year. For purposes of the Plan, the employment relationship shall be
treated as continuing intact while the individual is on sick leave or other
leave of absence approved by the Company. Where the period of leave exceeds 90
days and the individual's right to reemployment is not guaranteed either by
statute or by contract, the employment relationship will be deemed to have
terminated on the 91st day of such leave.

            (h) "Enrollment Date" shall mean the first day of each Offering
Period.
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            (i) "Exercise Date" shall mean the last Trading Day of each Purchase
Period. The first Exercise Date shall be the last Trading Day on or before
December 31, 1996.

            (j) "Fair Market Value" shall mean, as of any date, the value of
Common Stock determined as follows:

                  (1) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
National Market of the National Association of Securities Dealers, Inc.
Automated Quotation ("NASDAQ") System, its Fair Market Value shall be the
closing sale price for the Common Stock (or the mean of the closing bid and
asked prices, if no sales were reported), as quoted on such exchange (or the
exchange with the greatest volume of trading in Common Stock) or system on the
date of such determination, as reported in The Wall Street Journal or such other
source as the Board deems reliable; or

                  (2) If the Common Stock is quoted on the NASDAQ System (but
not on the National Market thereof) or is regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean of the closing bid and asked prices for the Common Stock on
the date of such determination, as reported in The Wall Street Journal or such
other source as the Board deems reliable; or

                  (3) In the absence of an established market for the Common
Stock, the Fair Market Value thereof shall be determined in good faith by the
Board.

                  (4) For purposes of the Enrollment Date of the first Offering
Period, the Fair Market Value of the Common Stock shall be the Price to Public
as set forth in the final prospectus filed with the Securities and Exchange
Commission pursuant to Rule 424 under the Securities Act of 1933, as amended.

            (k) "Offering Period" shall mean the period of approximately twelve
(12) months during which an option granted pursuant to the Plan may be
exercised, commencing on the first Trading Day on or after January 1 and July 1
of each year and terminating on the last Trading Day in the periods ending up to
one-year later (provided, however, that any employee with an Offering Period
beginning before January 1, 2001, shall have an initial Offering Period of up to
two-years). The first day of the first Offering Period shall be the effective
date of the Company's initial public offering of its Common Stock that is
registered with the Securities and Exchange Commission. The duration and timing
of Offering Periods may be changed pursuant to Section 4 of this Plan.

            (l) "Plan" shall mean this Neurocrine Biosciences, Inc. 1996
Employee Stock Purchase Plan as amended hereby.

            (m) "Purchase Price" shall mean an amount equal to 85% of the Fair
Market Value of a share of Common Stock on the Enrollment Date or on the
Exercise Date, whichever is lower. For purposes of Offering Periods commencing
on or after January 1, 2006, "Purchase Price" shall mean an amount equal to 85%
of the Fair Market Value of a share of Common Stock on the Exercise Date.

            (n) "Purchase Period" shall mean the approximately six-month period
commencing after one Exercise Date and ending with the next Exercise Date,
except that the first Purchase Period

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of any Offering Period shall begin on the Enrollment Date and end with the next
Exercise Date. The first Purchase Period of the first Offering Period shall
begin on the first day of the first Offering Period and shall end on the first
Exercise Date.

            (o) "Reserves" shall mean the number of shares of Common Stock
covered by each option under the Plan which have not yet been exercised and the
number of shares of Common Stock which have been authorized for issuance under
the Plan but not yet placed under option.

            (p) "Subsidiary" shall mean a corporation, domestic or foreign, of
which not less than 50% of the voting shares are held by the Company or a
Subsidiary, whether or not such corporation now exists or is hereafter organized
or acquired by the Company or a Subsidiary.

            (q) "Trading Day" shall mean a day on which national stock exchanges
and the National Association of Securities Dealers Automated Quotation (NASDAQ)
System are open for trading.

      3. Eligibility.

            (a) Any Employee (as defined in Section 2(g)), who shall be employed
by the Company on a given Enrollment Date shall be eligible to participate in
the Plan.

            (b) Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan (i) if, immediately after the
grant, such Employee (or any other person whose stock would be attributed to
such Employee pursuant to Section 424(d) of the Code) would own capital stock of
the Company and/or hold outstanding options to purchase such stock possessing
five percent (5%) or more of the total combined voting power or value of all
classes of the capital stock of the Company or of any Subsidiary, or (ii) if
such option permits his or her rights to purchase stock under all employee stock
purchase plans of the Company and its Subsidiaries to accrue at a rate which
exceeds twenty-five thousand dollars ($25,000) worth of stock (determined at the
fair market value of the shares at the time such option is granted) for each
calendar year in which such option is outstanding at any time.

      4. Offering Periods. The Plan shall be implemented by consecutive,
overlapping Offering Periods with a new Offering Period beginning on the first
Trading Day on or after July 1 and January 1 each year, or on such other date as
the Board shall determine, and continuing thereafter until terminated in
accordance with Section 19 hereof. The first day of the first Offering Period
shall be the effective date of the Company's initial public offering of its
Common Stock that is registered with the Securities and Exchange Commission. The
Board shall have the power to change the duration of Offering Periods (including
the commencement dates thereof) with respect to future offerings without
stockholder approval if such change is announced at least five (5) days prior to
the scheduled beginning of the first Offering Period to be affected thereafter.

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      5. Participation.

            (a) An eligible Employee may become a participant in the Plan by
completing a subscription agreement authorizing payroll deductions in the form
of Exhibit A to this Plan and filing it with the Company's payroll office prior
to the applicable Enrollment Date.

            (b) Payroll deductions for a participant shall commence on the first
payroll date following the Enrollment Date and shall end on the last payroll
date in the Offering Period to which such authorization is applicable, unless
sooner terminated by the participant as provided in Section 10 hereof.

      6. Payroll Deductions.

            (a) At the time a participant files his or her subscription
agreement, he or she shall elect to have payroll deductions made on each pay day
during the Offering Period in an amount not exceeding fifteen percent (15%) of
the Compensation which he or she receives on each pay day during the Offering
Period, and the aggregate of such payroll deductions during the Offering Period
shall not exceed fifteen percent (15%) of the participant's Compensation during
said Offering Period.

            (b) All payroll deductions made for a participant shall be credited
to his or her account under the Plan and will be withheld in whole percentages
only. A participant may not make any additional payments into such account.

            (c) A participant may discontinue his or her participation in the
Plan as provided in Section 10 hereof, or may increase or decrease the rate of
his or her payroll deductions during the Offering Period by completing or filing
with the Company a new subscription agreement authorizing a change in payroll
deduction rate. The Board may, in its discretion, limit the number of
participation rate changes during any Offering Period. The change in rate shall
be effective with the first full payroll period following five (5) business days
after the Company's receipt of the new subscription agreement unless the Company
elects to process a given change in participation more quickly. A participant's
subscription agreement shall remain in effect for successive Offering Periods
unless terminated as provided in Section 10 hereof.

            (d) Notwithstanding the foregoing, to the extent necessary to comply
with Section 423(b)(8) of the Code and Section 3(b) hereof, a participant's
payroll deductions may be decreased to 0% at such time during any Purchase
Period which is scheduled to end during the current calendar year (the "Current
Purchase Period") that the aggregate of all payroll deductions which were
previously used to purchase stock under the Plan in a prior Purchase Period
which ended during that calendar year plus all payroll deductions accumulated
with respect to the Current Purchase Period equal $21,250. Payroll deductions
shall recommence at the rate provided in such participant's subscription
agreement at the beginning of the first Purchase Period which is scheduled to
end in the following calendar year, unless terminated by the participant as
provided in Section 10 hereof.

            (e) At the time the option is exercised, in whole or in part, or at
the time some or all of the Company's Common Stock issued under the Plan is
disposed of, the participant must make adequate provision for the Company's
federal, state, or other tax withholding obligations, if any,

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which arise upon the exercise of the option or the disposition of the Common
Stock. At any time, the Company may, but will not be obligated to, withhold from
the participant's compensation the amount necessary for the Company to meet
applicable withholding obligations, including any withholding required to make
available to the Company any tax deductions or benefits attributable to sale or
early disposition of Common Stock by the Employee.

      7. Grant of Option. On the Enrollment Date of each Offering Period, each
eligible Employee participating in such Offering Period shall be granted an
option to purchase on each Exercise Date during such Offering Period (at the
Purchase Price) up to a number of shares of the Company's Common Stock
determined by dividing such Employee's payroll deductions accumulated prior to
such Exercise Date and retained in the Participant's account as of the Exercise
Date by the Purchase Price; provided, that in no event shall an Employee be
permitted to purchase during each Purchase Period more than a number of Shares
determined by dividing $12,500 by the Fair Market Value of a share of the
Company's Common Stock on the Enrollment Date; and provided, further, that such
purchase shall be subject to the limitations set forth in Sections 3(b) and 12
hereof. Exercise of the option shall occur as provided in Section 8 hereof,
unless the participant has withdrawn pursuant to Section 10 hereof, and shall
expire on the last day of the Offering Period.

      8. Exercise of Option. Unless a participant withdraws from the Plan as
provided in Section 10 hereof, his or her option for the purchase of shares will
be exercised automatically on the Exercise Date, and the maximum number of full
shares subject to the option shall be purchased for such participant at the
Purchase Price with the accumulated payroll deductions in his or her account. No
fractional shares will be purchased; any payroll deductions accumulated in a
participant's account which are not sufficient to purchase a full share shall be
retained in the participant's account for the subsequent Purchase Period or
Offering Period, subject to earlier withdrawal by the participant as provided in
Section 10 hereof. Any other monies left over in a participant's account after
the Exercise Date shall be returned to the participant. During a participant's
lifetime, a participant's option to purchase shares hereunder is exercisable
only by him or her.

      9. Delivery. As promptly as practicable after each Exercise Date on which
a purchase of shares occurs, the Company shall arrange the delivery to each
participant, as appropriate, of a certificate representing the shares purchased
upon exercise of his or her option.

      10. Withdrawal; Termination of Employment.

            (a) A participant may withdraw all but not less than all the payroll
deductions credited to his or her account and not yet used to exercise his or
her option under the Plan at any time by giving written notice to the Company in
the form of Exhibit B to this Plan. All of the participant's payroll deductions
credited to his or her account will be paid to such participant promptly after
receipt of notice of withdrawal and such participant's option for the Offering
Period will be automatically terminated, and no further payroll deductions for
the purchase of shares will be made for such Offering Period. If a participant
withdraws from an Offering Period, payroll deductions will not resume at the
beginning of the succeeding Offering Period unless the participant delivers to
the Company a new subscription agreement.

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            (b) Upon a participant's ceasing to be an Employee (as defined in
Section 2(g) hereof), for any reason, he or she will be deemed to have elected
to withdraw from the Plan and the payroll deductions credited to such
participant's account during the Offering Period but not yet used to exercise
the option will be returned to such participant or, in the case of his or her
death, to the person or persons entitled thereto under Section 14 hereof, and
such participant's option will be automatically terminated. The preceding
sentence notwithstanding, a participant who receives payment in lieu of notice
of termination of employment shall be treated as continuing to be an Employee
for the participant's customary number of hours per week of employment during
the period in which the participant is subject to such payment in lieu of
notice.

      11. Interest. No interest shall accrue on the payroll deductions of a
participant in the Plan.

      12. Stock.

            (a) The maximum number of shares of the Company's Common Stock which
shall be made available for sale under the Plan shall be six hundred and twenty
five thousand (625,000), subject to adjustment upon changes in capitalization of
the Company as provided in Section 18 hereof. If, on a given Exercise Date, the
number of shares with respect to which options are to be exercised exceeds the
number of shares then available under the Plan, the Company shall make a pro
rata allocation of the shares remaining available for purchase in as uniform a
manner as shall be practicable and as it shall determine to be equitable.

            (b) The participant will have no interest or voting right in shares
covered by his option until such option has been exercised.

            (c) Shares to be delivered to a participant under the Plan will be
registered in the name of the participant or in the name of the participant and
his or her spouse.

      13. Administration.

            (a) Administrative Body. The Plan shall be administered by the Board
or a committee of members of the Board appointed by the Board. The Board or its
committee shall have full and exclusive discretionary authority to construe,
interpret and apply the terms of the Plan, to determine eligibility and to
adjudicate all disputed claims filed under the Plan. Every finding, decision and
determination made by the Board or its committee shall, to the full extent
permitted by law, be final and binding upon all parties.

            (b) Rule 16b-3 Limitations. Notwithstanding the provisions of
Subsection (a) of this Section 13, in the event that Rule 16b-3 promulgated
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or
any successor provision ("Rule 16b-3") provides specific requirements for the
administrators of plans of this type, the Plan shall be only administered by
such a body and in such a manner as shall comply with the applicable
requirements of Rule 16b-3. Unless permitted by Rule 16b-3, no discretion
concerning decisions regarding the Plan shall be afforded to any committee or
person that is not "disinterested" as that term is used in Rule 16b-3.

      14. Designation of Beneficiary.

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            (a) A participant may file a written designation of a beneficiary
who is to receive any shares and cash, if any, from the participant's account
under the Plan in the event of such participant's death subsequent to an
Exercise Date on which the option is exercised but prior to delivery to such
participant of such shares and cash. In addition, a participant may file a
written designation of a beneficiary who is to receive any cash from the
participant's account under the Plan in the event of such participant's death
prior to exercise of the option. If a participant is married and the designated
beneficiary is not the spouse, spousal consent shall be required for such
designation to be effective.

            (b) Such designation of beneficiary may be changed by the
participant at any time by written notice. In the event of the death of a
participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such participant's death, the Company shall
deliver such shares and/or cash to the executor or administrator of the estate
of the participant, or if no such executor or administrator has been appointed
(to the knowledge of the Company), the Company, in its discretion, may deliver
such shares and/or cash to the spouse or to any one or more dependents or
relatives of the participant, or if no spouse, dependent or relative is known to
the Company, then to such other person as the Company may designate.

      15. Transferability. Neither payroll deductions credited to a
participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 14 hereof) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds from an Offering Period in accordance with Section 10 hereof.

      16. Use of Funds. All payroll deductions received or held by the Company
under the Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such payroll deductions.

      17. Reports. Individual accounts will be maintained for each participant
in the Plan. Statements of account will be given to participating Employees at
least annually, which statements will set forth the amounts of payroll
deductions, the Purchase Price, the number of shares purchased and the remaining
cash balance, if any.

      18. Adjustments Upon Changes in Capitalization, Dissolution, Liquidation,
Merger or Asset Sale.

            (a) Changes in Capitalization. Subject to any required action by the
stockholders of the Company, the Reserves as well as the price per share of
Common Stock covered by each option under the Plan which has not yet been
exercised shall be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Common
Stock, or any other increase or decrease in the number of shares of Common Stock
effected without receipt of consideration by the Company; provided, however,
that conversion of any convertible securities of the Company shall not be deemed
to have been "effected without receipt of consideration". Such adjustment shall
be made by the Board, whose determination in that respect shall be final,
binding and conclusive. Except as

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expressly provided herein, no issuance by the Company of shares of stock of any
class, or securities convertible into shares of stock of any class, shall
affect, and no adjustment by reason thereof shall be made with respect to, the
number or price of shares of Common Stock subject to an option.

            (b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Offering Periods will terminate
immediately prior to the consummation of such proposed action, unless otherwise
provided by the Board.

            (c) Merger or Asset Sale. In the event of a proposed sale of all or
substantially all of the assets of the Company, or the merger of the Company
with or into another corporation, each option under the Plan shall be assumed or
an equivalent option shall be substituted by such successor corporation or a
parent or subsidiary of such successor corporation, unless the Board determines,
in the exercise of its sole discretion and in lieu of such assumption or
substitution, to shorten the Offering Periods then in progress by setting a new
Exercise Date (the "New Exercise Date"). If the Board shortens the Offering
Periods then in progress in lieu of assumption or substitution in the event of a
merger or sale of assets, the Board shall notify each participant in writing, at
least ten (10) business days prior to the New Exercise Date, that the Exercise
Date for his option has been changed to the New Exercise Date and that his
option will be exercised automatically on the New Exercise Date, unless prior to
such date he has withdrawn from the Offering Period as provided in Section 10
hereof. For purposes of this paragraph, an option granted under the Plan shall
be deemed to be assumed if, following the sale of assets or merger, the option
confers the right to purchase, for each share of option stock subject to the
option immediately prior to the sale of assets or merger, the consideration
(whether stock, cash or other securities or property) received in the sale of
assets or merger by holders of Common Stock for each share of Common Stock held
on the effective date of the transaction (and if such holders were offered a
choice of consideration, the type of consideration chosen by the holders of a
majority of the outstanding shares of Common Stock); provided, however, that if
such consideration received in the sale of assets or merger was not solely
common stock of the successor corporation or its parent (as defined in Section
424(e) of the Code), the Board may, with the consent of the successor
corporation, provide for the consideration to be received upon exercise of the
option to be solely common stock of the successor corporation or its parent
equal in fair market value to the per share consideration received by holders of
Common Stock and the sale of assets or merger.

      19. Amendment or Termination.

            (a) The Board may at any time and for any reason terminate or amend
the Plan. Except as provided in Section 18 hereof, no such termination can
affect options previously granted; provided, that an Offering Period may be
terminated by the Board on any Exercise Date if the Board determines that the
termination of the Plan is in the best interests of the Company and its
stockholders. Except as provided in Section 18 hereof, no amendment may make any
change in any option theretofore granted which adversely affects the rights of
any participant. To the extent necessary to comply with Rule 16b-3 or under
Section 423 of the Code (or any successor rule or provision or any other
applicable law or regulation), the Company shall obtain stockholder approval in
such a manner and to such a degree as required.

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            (b) Without stockholder consent and without regard to whether any
participant rights may be considered to have been "adversely affected," the
Board (or its committee) shall be entitled to change the Offering Periods, limit
the frequency and/or number of changes in the amount withheld during an Offering
Period, establish the exchange ratio applicable to amounts withheld in a
currency other than U.S. dollars, permit payroll withholding in excess of the
amount designated by a participant in order to adjust for delays or mistakes in
the Company's processing of properly completed withholding elections, establish
reasonable waiting and adjustment periods and/or accounting and crediting
procedures to ensure that amounts applied toward the purchase of Common Stock
for each participant properly correspond with amounts withheld from the
participant's Compensation, and establish such other limitations or procedures
as the Board (or its committee) determines in its sole discretion advisable
which are consistent with the Plan.

      20. Notices. All notices or other communications by a participant to the
Company under or in connection with the Plan shall be deemed to have been duly
given when received in the form specified by the Company at the location, or by
the person, designated by the Company for the receipt thereof.

      21. Conditions Upon Issuance of Shares. Shares shall not be issued with
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Exchange Act, the rules and regulations
promulgated thereunder, and the requirements of any stock exchange upon which
the shares may then be listed, and shall be further subject to the approval of
counsel for the Company with respect to such compliance.

            As a condition to the exercise of an option, the Company may require
the person exercising such option to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned applicable provisions of law.

      22. Term of Plan. The Plan shall become effective upon the earlier to
occur of its adoption by the Board or its approval by the stockholders of the
Company. It shall continue in effect for a term of ten (10) years unless sooner
terminated under Section 19 hereof.

      23. Automatic Transfer to Low Price Offering Period. To the extent
permitted by Rule 16b-3 of the Exchange Act, if the Fair Market Value of the
Common Stock on any Exercise Date in an Offering Period is lower than the Fair
Market Value of the Common Stock on the Enrollment Date of such Offering Period,
then all participants in such Offering Period shall be automatically withdrawn
from such Offering Period immediately after the exercise of their option on such
Exercise Date and automatically re-enrolled in the immediately following
Offering Period as of the first day thereof.

      24. Stockholder Approval. Continuance of the Plan shall be subject to
approval by the stockholders of the Company within twelve (12) months before or
after the date the Plan is adopted.

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Such stockholder approval shall be obtained in the degree and manner required
under applicable state and federal law.

      25. Financial Reports. The Company shall provide to each Optionee, not
less frequently than annually during the period such Optionee has one or more
Options outstanding, copies of annual financial statements. The Company shall
not be required to provide such statements to key employees whose duties in
connection with the Company assure their access to equivalent information.

                                      -10-
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                                    EXHIBIT A

                          NEUROCRINE BIOSCIENCES, INC.

                        1996 EMPLOYEE STOCK PURCHASE PLAN

                             SUBSCRIPTION AGREEMENT

_____ Original Application                          Enrollment Date: ___________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)

1.    ___________________ hereby elects to participate in the Neurocrine
      Biosciences, Inc. 1996 Employee Stock Purchase Plan (the "Employee Stock
      Purchase Plan") and subscribes to purchase shares of the Company's Common
      Stock in accordance with this Subscription Agreement and the Employee
      Stock Purchase Plan.

2.    I hereby authorize payroll deductions from each paycheck in the amount of
      ____% of my Compensation on each payday (1-15%) during the Offering Period
      in accordance with the Employee Stock Purchase Plan. (Please note that no
      fractional percentages are permitted.)

3.    I understand that said payroll deductions shall be accumulated for the
      purchase of shares of Common Stock at the Purchase Price determined in
      accordance with the Employee Stock Purchase Plan. I understand that if I
      do not withdraw from an Offering Period, any accumulated payroll
      deductions will be used to automatically exercise my option.

4.    I have received a copy of the complete "Neurocrine Biosciences, Inc. 1996
      Employee Stock Purchase Plan." I understand that my participation in the
      Employee Stock Purchase Plan is in all respects subject to the terms of
      the Employee Stock Purchase Plan. I understand that my ability to exercise
      the option under this Subscription Agreement is subject to obtaining
      stockholder approval of the Employee Stock Purchase Plan.

5.    Shares purchased for me under the Employee Stock Purchase Plan should be
      issued in the name(s) of (Employee or Employee and spouse only):
      ____________________.

6.    I understand that if I dispose of any shares received by me pursuant to
      the Plan within 2 years after the Enrollment Date (the first day of the
      Offering Period during which I purchased such shares) or one year after
      the Exercise Date, I will be treated for federal income tax purposes as
      having received ordinary income at the time of such disposition in an
      amount equal to the excess of the fair market value of the shares at the
      time such shares were purchased over the price which I paid for the
      shares. I HEREBY AGREE TO NOTIFY THE COMPANY IN WRITING WITHIN 30 DAYS
      AFTER THE DATE OF ANY DISPOSITION OF MY SHARES AND I WILL MAKE ADEQUATE
<PAGE>
      PROVISION FOR FEDERAL, STATE OR OTHER TAX WITHHOLDING OBLIGATIONS, IF ANY,
      WHICH ARISE UPON THE DISPOSITION OF THE COMMON STOCK. The Company may, but
      will not be obligated to, withhold from my compensation the amount
      necessary to meet any applicable withholding obligation including any
      withholding necessary to make available to the Company any tax deductions
      or benefits attributable to sale or early disposition of Common Stock by
      me. If I dispose of such shares at any time after the expiration of the
      2-year and 1-year holding periods, I understand that I will be treated for
      federal income tax purposes as having received income only at the time of
      such disposition, and that such income will be taxed as ordinary income
      only to the extent of an amount equal to the lesser of (1) the excess of
      the fair market value of the shares at the time of such disposition over
      the purchase price which I paid for the shares, or (2) 15% of the fair
      market value of the shares on the first day of the Offering Period.  The
      remainder of the gain, if any, recognized on such disposition will be
      taxed as capital gain.

7.    I hereby agree to be bound by the terms of the Employee Stock Purchase
      Plan. The effectiveness of this Subscription Agreement is dependent upon
      my eligibility to participate in the Employee Stock Purchase Plan.

8.    In the event of my death, I hereby designate the following as my
      beneficiary(ies) to receive all payments and shares due me under the
      Employee Stock Purchase Plan:

NAME:  (Please print)   ____________________________________________________
                        (First)              (Middle)              (Last)

                        ____________________________________________________
                        Relationship

                        ____________________________________________________

                        ____________________________________________________
                        (Address)

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<PAGE>
Employee's Social
Security Number:        _______________________________________

Employee's Address:     _______________________________________

                        _______________________________________

                        _______________________________________

I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT
SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.

Dated: ____________________         __________________________________________
                                    Signature of Employee

                                    __________________________________________
                                    Spouse's Signature (If beneficiary other
                                    than spouse)

                                      -3-
<PAGE>
                                    EXHIBIT B

                          NEUROCRINE BIOSCIENCES, INC.

                        1996 EMPLOYEE STOCK PURCHASE PLAN

                              NOTICE OF WITHDRAWAL

      The undersigned participant in the Offering Period of the Neurocrine
Biosciences, Inc. 1996 Employee Stock Purchase Plan which began on ____________,
19____ (the "Enrollment Date") hereby notifies the Company that he or she hereby
withdraws from the Offering Period. He or she hereby directs the Company to pay
to the undersigned as promptly as practicable all the payroll deductions
credited to his or her account with respect to such Offering Period. The
undersigned understands and agrees that his or her option for such Offering
Period will be automatically terminated. The undersigned understands further
that no further payroll deductions will be made for the purchase of shares in
the current Offering Period and the undersigned shall be eligible to participate
in succeeding Offering Periods only by delivering to the Company a new
Subscription Agreement.

                                          Name and Address of Participant:

                                          ______________________________________

                                          ______________________________________

                                          ______________________________________

                                          Signature:

                                          ______________________________________

                                          Date: ________________________________<PAGE>

                                                                    EXHIBIT 10.1

                                ESCROW AGREEMENT

          This Escrow Agreement (this "Agreement") dated as of February 1, 2006,
is made by and among WebSideStory, Inc., a Delaware corporation ("Parent"), Ned
Scherer, an individual, in his capacity as the representative (the "Member
Representative") of all of the Unitholders and Accredited Optionholders (each, a
"Holder" and collectively, the "Holders") of Visual Sciences, LLC, a Delaware
limited liability company (the "Company"), and U.S. Stock Transfer Corporation,
as Depository Agent (the "Depository Agent").

                                    RECITALS

          WHEREAS, pursuant to an Agreement and Plan of Merger made and entered
into as of February 1, 2006 by and among Parent, VS Acquisition, LLC, a Delaware
limited liability company and a direct, wholly owned subsidiary of Parent
("Merger Sub"), the Company and the Member Representative (as it may be amended
from time to time pursuant to the terms thereof, the "Merger Agreement"), at the
Effective Time, the Company will be merged with and into Merger Sub, in
accordance with the terms of the Merger Agreement.

          WHEREAS, Section 3.2 of the Merger Agreement provides that in order to
satisfy any claims for indemnification made by Parent pursuant to Article VIII
of the Merger Agreement, an escrow account (the "Escrow Account") shall be
established into which Parent shall deposit shares of Parent Common Stock
constituting the Escrow Fund at the Effective Time.

          WHEREAS, a material condition to the consummation of the transactions
contemplated by the Merger Agreement is that the parties hereto enter into this
Agreement.

                                    AGREEMENT

          NOW THEREFORE, as a material inducement to Parent, Merger Sub, the
Company and the Member Representative to consummate the transactions
contemplated by the Merger Agreement, and for other good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged, the
parties hereby agree as follows:

          1. Defined Terms. Capitalized terms used herein without definition
shall have the meanings ascribed to them in the Merger Agreement.

          2. Commencement of Duties. Parent, concurrently with the execution and
delivery of this Agreement and pursuant to Section 3.2 of the Merger Agreement,
is transferring to the Depository Agent the Escrow Fund consisting entirely of
the Escrowed Shares. Upon receipt of the Escrowed Shares by the Depository
Agent, the duties and obligations of each of the parties to this Agreement will
commence.

<PAGE>

          3. Escrow Fund.

               (a) Upon receipt of the Escrowed Shares, the Depository Agent
shall send a notice to Parent and the Member Representative acknowledging
receipt of the Escrowed Shares and shall hold the Escrowed Shares in escrow in
the Escrow Account pursuant to the terms of this Agreement.

               (b) The certificates representing the Escrowed Shares shall be
retained in the Escrow Account until released pursuant to Section 6 of this
Agreement. The proceeds of all dividends or distributions in respect of the
Escrowed Shares (including dividends and distributions described in Section
3(c)), and all other cash, securities or other property received in exchange for
or in substitution of the Escrowed Shares (including as described in Section
3(d)) (collectively, "Proceeds") shall be retained in the Escrow Account until
released pursuant to Section 6 of this Agreement.

               (c) Parent and the Holders agree that any cash dividends,
securities or other property distributable in respect of the Escrowed Shares
shall be distributed by the Parent to, and held by, the Depository Agent in the
Escrow Account subject to the provisions of this Agreement to the same extent as
the Escrowed Shares.

               (d) If, after the date of this Agreement, the Escrowed Shares
shall have been changed into a different number of shares or a different type or
class of securities, by reason of any stock dividend, subdivision,
reclassification, recapitalization, split, combination, merger or exchange of
shares, such different number of shares or type or class of securities shall be
held in the Escrow Account subject to the provisions of this Agreement to the
same extent as the Escrowed Shares, and the provisions of this Agreement shall
be correspondingly adjusted to the extent appropriate to reflect equitably such
stock dividend, subdivision, reclassification, recapitalization, split,
combination, merger or exchange of shares.

          4. Holders' Pro Rata Shares of the Escrow Fund.

               (a) Each Unitholder as of the Closing and each Accredited
Optionholder holding vested Company Options immediately prior to the Closing, as
identified on Schedule A-1 hereto, shall have the following interest in the
Escrow Account, from time to time:

               (i) an interest in all Escrowed Shares equal to such proportion
          of the total number thereof equal to such Holder's Pro Rata Share of
          the Escrow Fund, as set forth on Schedule A-2 hereto; and

               (ii) an interest in all Proceeds, if any, of the Escrowed Shares
          equal to the portion thereof equal to such Holder's Pro Rata Share of
          the Escrow Fund, as set forth on Schedule A-2 hereto.

          5. No Stockholder Rights.

               (a) As long as any Escrowed Shares are held in the Escrow
Account, and pending the distribution thereof to Parent or the Holders, as the
case may be, in connection with any distributions from the Escrow Account in
accordance with the terms hereof, the Depositary

                                        2

<PAGE>

Agent will have the right to exercise any voting rights with respect to the
Escrowed Shares. In connection with any Parent stockholder meetings or
solicitations of proxies or written consents from Parent stockholders, Parent
will direct the Depositary Agent in writing as to the exercise of voting and
consent rights for the Escrowed Shares, which directions shall replicate as
closely as practicable the split of yes, no and abstain votes cast by all other
stockholders of Parent in connection with such meeting or consent. The
Depository Agent shall comply with any such directions of the Parent. In the
absence of such directions from the Parent, the Depository Agent shall not vote
or grant its consent with respect to any of the Escrowed Shares.

               (b) Prior to the distribution of the Escrowed Shares in
accordance with the terms hereof, the Holders shall have no rights in the
Escrowed Shares, including without limitation, no rights to sell, assign,
pledge, hypothecate or otherwise dispose of or encumber such Escrowed Shares or
any interest therein.

          6. Payments from the Escrow Account.

               (a) A Parent Indemnified Party shall initiate a claim against the
Escrow Fund by delivering to the Member Representative, with a copy to the
Depository Agent, a written notice (an "Indemnification Notice"), which
Indemnification Notice shall:

               (i) state that such Parent Indemnified Party is a Parent
          Indemnified Party under the Merger Agreement and has paid or incurred
          one or more Losses that satisfy the indemnification provisions set
          forth in Section 8.2 of the Merger Agreement (each, a "Covered Loss");

               (ii) state in good faith the aggregate amount (the
          "Indemnification Amount") of each such Covered Loss; and

               (iii) specify in reasonable detail the nature and basis of each
          such Covered Loss.

               (b) If the Member Representative shall object in good faith to
any portion of any Indemnification Amount specified in any Indemnification
Notice, the Member Representative shall, within thirty (30) calendar days after
delivery by the Parent Indemnified Party to the Member Representative of such
Indemnification Notice, deliver to the Depository Agent (with a copy to the
Parent Indemnified Party) a certificate, executed by the Member Representative
(a "Certificate of Objections"):

               (i) specifying each such amount to which the Member
          Representative objects in good faith; and

               (ii) specifying in reasonable detail the nature and basis for
          each such good faith objection.

Promptly upon receipt of a Certificate of Objections, the Depository Agent shall
deliver a copy of such Certificate of Objections to the Parent Indemnified
Party.

                                        3

<PAGE>

               (c) If the Depository Agent shall not have received a Certificate
of Objections objecting to an Indemnification Amount within thirty (30) calendar
days after delivery to the Member Representative of an Indemnification Notice
specifying such Indemnification Amount, the Holders and the Member
Representative shall be deemed to have acknowledged that the Indemnification
Amount claimed on such Indemnification Notice is correct and final and the
Depository Agent shall thereafter transfer to such Parent Indemnified Party out
of the Escrow Account (such transfer to be applied and deducted from the Escrow
Fund pro rata in accordance with each Holder's Pro Rata Share of the Escrow
Fund) such number of Escrowed Shares with an aggregate value equal to the
Indemnification Amount set forth in the Indemnification Notice, together with
any Proceeds attributable to such transferred Escrowed Shares. For purposes of
this Agreement, each Escrowed Share shall be deemed to have a value equal to the
Parent Common Stock Price (as such amount may be appropriately adjusted for
stock splits, stock dividends, stock combinations, and the like).

               (d) If the Depository Agent receives, within thirty (30) calendar
days after delivery to the Member Representative of an Indemnification Notice, a
Certificate of Objections objecting to the Indemnification Amount specified in
such Indemnification Notice, the amount so objected to shall be held by the
Depository Agent and shall not be released from the Escrow Account, except in
accordance with either:

               (i) written instructions executed by Parent and the Member
          Representative, or

               (ii) written instructions from the Parent Indemnified Party and
          the final judgment of the arbitrator having jurisdiction over the
          matters relating to the claim, as provided in Section 7,

after which time the Depository Agent shall cause: (A) a transfer to the Parent
Indemnified Party in the manner set forth in Section 6(c); provided, that all
references to the Indemnification Amount shall be deemed to be references to the
amount to be transferred to the Parent Indemnified Party as specified in the
written instruction or judgment, as the case may be; and (B) in the event such
written instruction or judgment is delivered following the First Release Date
(as defined below), a distribution to the Holders in an aggregate amount equal
to the amount so objected to and not released pursuant to (A) above (the
"Holdback Release"). Any Holdback Release shall be distributed to each Holder,
in an amount equal to the product of the Holdback Release multiplied by such
Holder's Pro Rata Share of the Escrow Fund, together with any Proceeds
attributable to such released Escrowed Shares.

               (e) Subject to Section 11, on the earlier of (i) April 1, 2007 or
(ii) such date as shall have been specified in a joint written notice of Parent
and the Member Representative to the Depository Agent (the "First Release
Date"), the Depository Agent shall distribute a number of Escrowed Shares that
have a value equal to the amount, if any, by which the value of the Escrowed
Shares at such date (valued at the Parent Common Stock Price (as such amount may
be appropriately adjusted for stock splits, stock dividends, stock combinations,
and the like)), exceeds the First Reserved Amount (the "First Released Amount").
The First Released Amount shall be transferred to each Holder, in an amount
equal to the product of the

                                        4

<PAGE>

First Released Amount multiplied by such Holder's Pro Rata Share of the Escrow
Fund, together with any Proceeds attributable to such released Escrowed Shares.

The "First Reserved Amount" means an amount equal to the aggregate of the
Indemnification Amounts claimed and unpaid (other than claims which shall have
been resolved and for which no payment shall be due), in all Indemnification
Notices delivered to the Depository Agent prior to the First Release Date,
subject to the limitations set forth in Section 8.4 of the Merger Agreement.

               (f) Upon the termination of this Agreement in accordance with
Section 10, but subject to Section 11, the Depository Agent shall promptly
distribute the remaining Escrowed Shares to each Holder, in an amount equal to
the product of the remaining value multiplied by such Holder's Pro Rata Share of
the Escrow Fund, together with any Proceeds attributable to such released
Escrowed Shares.

               (g) Notwithstanding the provisions of this Section 6, if a Holder
of Units has not submitted to Parent a letter of transmittal in proper form
pursuant to Section 4.1(b) of the Merger Agreement prior to the time of any
distribution to the Holders, the amount deliverable to such Holder shall be
delivered to Parent, to be held by Parent on behalf of such Holder pursuant to
Section 4.1(f) of the Merger Agreement.

               (h) Notwithstanding any other provision of this Agreement to the
contrary, at any time prior to the termination of this Agreement, the Depository
Agent shall, if so instructed in writing signed by Parent and the Member
Representative, pay from the Escrow Account, as instructed, to Parent, any
Indemnified Party or any Holder, as directed in such writing, the number of
Escrow Shares and any Proceeds attributable thereto.

          7. Resolution of Conflicts

               (a) In case the Member Representative shall timely object in
writing to any claim or claims by a Parent Indemnified Party made in any
Indemnification Notice, as provided in Section 6(b), the Member Representative
and the Parent Indemnified Party shall attempt in good faith for thirty (30)
calendar days following delivery of the Certificate of Objections to agree upon
the rights of the respective parties with respect to each of such claims. If the
Member Representative and the Indemnified Party should so agree, a memorandum
setting forth such agreement shall be prepared and signed by both parties and
shall be furnished to the Depository Agent. The Depository Agent shall be
entitled to rely on any such memorandum and shall distribute amounts from the
Escrow Fund in accordance with the terms thereof.

               (b) If no such agreement can be reached after good faith
negotiation, either the Parent Indemnified Party or the Member Representative
may, by written notice to the other, demand arbitration of the matter unless the
amount of the damage or loss is at issue in pending litigation with a third
party, in which event arbitration shall not be commenced until such amount is
ascertained or both parties agree to arbitration; and in either such event the
matter shall be settled by arbitration conducted by a single arbitrator. The
arbitrator shall be jointly selected by the Parent Indemnified Party and the
Member Representative within fifteen (15) calendar days after such written
notice is sent, or absent such agreement, such arbitrator shall be

                                        5

<PAGE>

appointed pursuant to the Commercial Arbitration Rules then in effect of the
American Arbitration Association. The decision of the arbitrator as to the
validity and amount of any claim in such Indemnification Notice shall be binding
and conclusive upon the parties to this Agreement, and the Depository Agent
shall be entitled to act in accordance with such decision and make or withhold
payments out of the Escrow Fund in accordance therewith.

               (c) Any such arbitration shall be held in Washington, D.C. under
the Commercial Arbitration Rules then in effect of the American Arbitration
Association. For purposes of this Section 7, in any arbitration hereunder in
which any claim or the amount thereof stated in the Indemnification Notice is at
issue, the Parent Indemnified Party shall be deemed to be the "Non-Prevailing
Party" unless the arbitrator awards the Parent Indemnified Party more than
one-half (1/2) of the amount in dispute; otherwise, the Member Representative
(on behalf of the Holders) shall be deemed to be the Non-Prevailing Party. The
Non-Prevailing Party to an arbitration shall pay its own expenses, the fees of
the arbitrator, the administrative fee of the American Arbitration Association,
and the expenses, including without limitation, attorneys' fees and costs,
reasonably incurred by the other party to the arbitration. Judgment upon any
award rendered by the arbitrators may be entered in any court having
jurisdiction.

          8. Tax Matters

               (a) The parties intend for federal income tax purposes, that
property held by the Depository Agent shall be treated as delivered to recipient
Unitholders and Accredited Optionholders at the time such property is
distributed to them from escrow (and not at the time of deposit into escrow).

               (b) All earnings, if any, on the Escrow Fund shall be treated as
having been received by Parent for United States federal income tax purposes.

               (c) The Holders shall provide to the Depository Agent within
thirty (30) days after the Closing Date all forms and information that the
Depository Agent may reasonably require (including, without limitation, IRS
Forms W-8 or W-9, as applicable).

               (d) The Depository Agent annually shall file any applicable
information returns with the IRS and provide statements to Parent, with copies
to the Member Representative, documenting any earnings on the Escrow Fund. In
the event that the Depository Agent becomes liable for the payment of Taxes
relating to earnings on the Escrow Fund or any payment made hereunder
(including, but not limited to, withholding Taxes), the Depository Agent may
collect such Taxes directly from the Parent or the applicable Holders. Except as
otherwise provided in this Agreement, the Depository Agent shall have no
obligation to prepare or file any other Tax Returns or to pay any Taxes or
estimated Taxes.

          9. Depository Agent.

               (a) Duties of the Depository Agent. The Depository Agent shall
have no duties or responsibilities other than those expressly set forth in this
Agreement, and no implied duties or obligations shall be read into this
Agreement against the Depository Agent. The Depository Agent shall have no duty
to enforce any obligation of any Person, other than as provided herein. The
Depository Agent shall be under no liability to anyone by reason of any

                                        6

<PAGE>

failure on the part of any party hereto or any maker, endorser or other
signatory of any document or any other person to perform such person's
obligations under any such document.

               (b) Liability of the Depository Agent.

                    (i) In performing any duties under this Agreement, the
Depository Agent shall not be liable to any party for consequential damages,
(including, without limitation lost profits) losses, or expenses, except for
gross negligence or willful misconduct on the part of the Depository Agent. The
Depository Agent shall not incur any such liability for any act or failure to
act made or omitted in good faith or for any action taken or omitted in reliance
upon any instrument, including any written statement or affidavit provided for
in this Agreement that the Depository Agent shall in good faith believe to be
genuine, nor will the Depository Agent be liable or responsible for forgeries,
fraud, impersonations, or determining the scope of any representative authority.
In addition, the Depository Agent may consult with legal counsel in connection
with the Depository Agent's duties under this Agreement and shall be fully
protected in any act taken, suffered, or permitted by him/her in good faith in
accordance with the advice of counsel. The Depository Agent is not responsible
for determining and verifying the authority of any person acting or purporting
to act on behalf of any party to this Agreement. The parties shall indemnify and
hold the Depository Agent harmless from any and all liability for acting on an
investment instruction purported to be given by Parent and the Member
Representative to the extent of 50% for Parent and 50% for the Member
Representative (on behalf of the Holders, and which indemnification by the
Member Representative and the Holders shall be solely out of and only to the
extent of the Escrow Fund). The Depository Agent shall not be responsible for
the authenticity of any instructions, or be in any way liable for any
unauthorized instruction or for acting on such an instruction, whether or not
the person giving the instruction was, in fact, an authorized representative of
Parent and the Member Representative.

                    (ii) In no event shall the Depository Agent be liable to the
parties for any consequential, special, or exemplary damages, including but not
limited to lost profits, from any cause whatsoever arising out of, or in any way
connected with acting upon instructions believed by the Depository Agent to be
genuine. The Depository Agent shall not be liable for any loss from such
investments, including upon the sale or disposition of any investments. The
Depository Agent shall not be liable for any loss arising directly or
indirectly, in whole or in part, from the inability to invest funds on the day
the instructions are received. The Depository Agent shall not be liable for any
loss incurred by the actions of third parties or by any loss arising by error,
failure, or delay in making an investment which is caused by circumstances
beyond the Depository Agent's reasonable control.

                    (iii) Parent and the Member Representative (on behalf of the
Holders) agree, to the extent of 50% for Parent and 50% for the Member
Representative (on behalf of the Holders, which indemnification by the Member
Representative and the Holders shall be solely out of and only to the extent of
the Escrow Fund), to jointly and severally indemnify and hold the Depository
Agent harmless against any and all losses, claims, damages, liabilities, and
expenses, including reasonable costs of investigation, counsel fees, including
allocated costs of in-house counsel and disbursements that may be imposed on the
Depository Agent or incurred by the Depository Agent in connection with the
performance of its/his/her duties under this Agreement, including but not
limited to any litigation arising from this

                                        7

<PAGE>

Agreement or involving its subject matter, except in the case of the Depository
Agent's gross negligence or willful misconduct.

                    (iv) If any controversy arises between the parties to this
Agreement, or with any other party, concerning the subject matter of this
Agreement, its terms or conditions, the Depository Agent will not be required to
determine the controversy or to take any action regarding it. The Depository
Agent may hold all documents and funds and may wait for settlement of any such
controversy by final appropriate legal proceedings or other means as, in the
Depository Agent's discretion, the Depository Agent may require, despite what
may be set forth elsewhere in this Agreement. In such event, the Depository
Agent will not be liable for interest or damage. Furthermore, the Depository
Agent may at its option, file an action of interpleader requiring the parties to
answer and litigate any claims and rights among themselves. The Depository Agent
is authorized to deposit with the clerk of the court all documents and funds
held in escrow, except all costs, expenses, charges and reasonable attorneys'
fees incurred by the Depository Agent due to the interpleader action and which
the parties jointly and severally agree to pay. Upon initiating such action, the
Depository Agent shall be fully released and discharged of and from all
obligations and liability imposed by the terms of this Agreement.

               (c) Withdrawal of Depository Agent. The Depository Agent may
resign at any time upon giving at least thirty (30) days' written notice to the
parties; provided, however, that no such resignation shall become effective
until the appointment of a successor Depository Agent, which shall be
accomplished as follows: The parties shall use their reasonable efforts to
mutually agree on a successor Depository Agent within thirty (30) days after
receiving such notice. If the parties fail to agree upon a successor Depository
Agent within such time, the Depository Agent shall have the right to appoint a
successor Depository Agent authorized to do business in the State of California.
The successor Depository Agent shall execute and deliver an instrument accepting
such appointment, and it shall, without further acts, be vested with all the
estates, properties, rights, powers, and duties of the predecessor Depository
Agent as if originally named as the Depository Agent. The Depository Agent shall
thereafter be discharged from any further duties and liability under this
Agreement.

               (d) Change of Control of Depository Agent. Any company into which
the Depository Agent may be merged or with which it may be consolidated, or any
company to whom the Depository Agent may transfer a substantial amount of its
business, shall be the successor to the Depository Agent without the execution
or filing of any paper or any further act on the part of any of the parties,
anything herein to the contrary notwithstanding.

               (e) Fees. The Depository Agent's fees shall be as set forth on
Exhibit B hereto, payable by Parent. It is understood that the fees and usual
charges agreed upon for services of the Depository Agent shall be considered
compensation for ordinary services as contemplated by this Agreement. In the
event that the conditions of this Agreement are not promptly fulfilled, or if
the Depository Agent renders any service not provided for in this Agreement, or
if the parties request a substantial modification of its terms, or if any
controversy arises, or if the Depository Agent is made a party to, or intervenes
in, any litigation pertaining to this escrow or its subject matter, the
Depository Agent shall be reasonably compensated for such extraordinary services
and reimbursed for all reasonable costs, attorneys' fees, including allocated
costs of in-house counsel, and expenses occasioned by such default, delay,
controversy

                                        8

<PAGE>

or litigation, and the Depository Agent shall have the right to retain all
documents and/or other things of value at any time held by the Depository Agent
in this escrow until such compensation, fees, costs and expenses are paid. Any
such extraordinary fees, costs and expenses shall be payable 50% by Parent and
50% by the Member Representative (on behalf of the Holders out of the Escrow
Fund and only to the extent of the funds and property comprising the Escrow
Fund).

          10. Termination. This Agreement shall terminate on the later of: (a)
the date on which there are no Escrowed Shares or other property remaining in
the Escrow Fund and (b) ten business days following the date on which all claims
made in Indemnification Notices timely delivered to the Depository Agent shall
have been resolved.

          11. Holder Representative Costs and Expenses. By virtue of their
approval of the Merger (including this Agreement), the Holders hereby agree to
pay (i) the reasonable fees of the Member Representative relating to its/his/her
services performed in such capacity and (ii) all costs and expenses, including
those of any legal counsel or other professional retained by the Member
Representative, in connection with the acceptance and administration of the
Member Representative's duties hereunder. Subject to the prior right of Parent
to make claims for indemnification hereunder, the Member Representative shall
have the right to recover from distributions to the Holders from the Escrow
Account pursuant to this Agreement, and prior to any such distribution, a number
of Escrowed Shares set forth in a certificate of the Member Representative
delivered to the Depository Agent three (3) business days prior to the date on
which a distribution is to be made to the Holders, which number of shares shall
be equal to (A) any fees, costs and expenses set forth in such certificate,
including those of any legal counsel or other professional retained by the
Member Representative, in connection with the acceptance and administration of
the Holder Representative's duties hereunder, multiplied by (B) the closing
price of Parent Common Stock on the securities exchange or automated quotation
service upon which the Parent Common Stock is then listed or quoted for trading
on the trading day immediately preceding the third business day prior to the
date on which a distribution is to be made to the Holders.

          12. Miscellaneous.

               (a) Inspection. The Escrow Fund shall at all times be clearly
identified as being held by the Depository Agent hereunder. Any party hereto may
at any time during the Depository Agent's business hours (with reasonable
notice) inspect any records or reports relating to the Escrow Fund.

               (b) Controlling Document. To the extent provisions of the Merger
Agreement are inconsistent with the provisions contained herewith, this
Agreement shall supersede the Merger Agreement and be the controlling document;
provided, however, that the provisions of Article VIII of the Merger Agreement
shall control for all purposes, except with regard to the Depository Agent's
duties.

               (c) Notices. Unless otherwise provided herein, all notices and
other communications hereunder shall be in writing and shall be deemed given if
(a) delivered in person, (b) transmitted by telecopy (with written
confirmation), (c) mailed by certified or registered mail (return receipt
requested) (in which case such notice shall be deemed given on

                                        9

<PAGE>

the third (3rd) day after such mailing, but only if deposited at a U.S. Postal
Service office) or (d) delivered by an express courier (with written
confirmation) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):

               If to Parent:

                    WebSideStory, Inc.
                    10182 Telesis Court, 6th Floor
                    San Diego, California 92121
                    Facsimile: (858) 546-0695
                    Attention: General Counsel

                    With a copy (which shall not constitute notice) to:

                    Latham & Watkins LLP
                    12636 High Bluff Drive, Suite 400
                    San Diego, California 92130
                    Telephone: (858) 523-5406
                    Facsimile: (858) 523-5450
                    Attention: Barry M. Clarkson

               If to the Member Representative:

                    Ned Scherer
                    Kaiser, Scherer & Schlegel, PLLC
                    1410 Springhill Drive
                    McLean, VA 22102
                    Telephone: (703) 847-4660
                    Facsimile: (703) 847-3189

               With a copy (which shall not constitute notice) to:

                    Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
                    Chrysler Center
                    666 Third Avenue
                    New York, NY 10017
                    Attention: Richard R. Kelly, Esq.
                    Telephone: (212) 935-3000
                    Facsimile: (212) 983-3115

                                       10

<PAGE>

               If to the Depository Agent:

                    U.S. Stock Transfer Corporation
                    1745 Gardena Ave.
                    Glendale, CA 91204-2991
                    Telephone: (818) 502-1404
                    Facsimile: (818 502-0674
                    Attn: William Garza

          Any party may, from time to time, designate any other address to which
any such notice to it or such party shall be sent. Any such notice shall be
deemed to have been delivered upon receipt.

               (d) Governing Law. THIS AGREEMENT, THE LEGAL RELATIONS BETWEEN
THE PARTIES AND THE ADJUDICATION AND THE ENFORCEMENT THEREOF, SHALL BE GOVERNED
BY AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE
STATE OF DELAWARE WITHOUT REGARD TO APPLICABLE CHOICE OF LAW PROVISIONS THEREOF.

               (e) Binding Effect. This Agreement shall be binding upon the
Holders, the parties hereto and their respective successors and permitted
assigns. No provision of this Agreement is intended or shall be construed to
confer upon any entity or Person other than the Holders (solely with respect to
Sections 6(d), 6(e), and 6(f)), the parties hereto and their respective
successors and permitted assigns any benefit, right, remedy or claim under or by
reason of this Agreement or any part hereof. This Agreement may not be assigned
by any of the parties hereto; provided, however, that Parent may assign all or
part of its rights under this Agreement and delegate all or part of its
obligations under this Agreement to (i) a wholly owned Subsidiary of Parent, in
which event all of the rights and powers of Parent and remedies available to
Parent under this Agreement shall extend to and be enforceable by such
Subsidiary (provided that Parent remains jointly and severally liable with such
assignee for any obligations of Parent hereunder after such assignment) or (ii)
any Person who acquires Parent, whether by way of merger or the purchase of all
of Parent's outstanding capital stock or all or substantially all of Parent's
assets. In the event of any such assignment and delegation, the term "Parent" as
used in this Agreement shall be deemed to refer to such Subsidiary or successor
of Parent, as the case may be, where reference is made with respect to actions
to be taken with respect to the transactions contemplated by the Merger
Agreement and this Agreement, and shall be deemed to include both Parent and
such Subsidiary or successor of Parent, as the case may be, where appropriate.

               (f) Modification. This Agreement may be amended or modified at
any time by a writing executed by each of Parent, the Member Representative and
the Depository Agent.

               (g) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall

                                       11

<PAGE>

constitute one and the same agreement, it being understood that all of the
parties need not sign the same counterpart.

               (h) Headings. The section headings contained in this Agreement
are inserted for convenience only, and shall not affect in any way, the meaning
or interpretation of this Agreement.

               (i) Entire Agreement; Severability and Further Assurances. Except
as provided herein, this Agreement together with the Merger Agreement and all
exhibits and schedules attached hereto constitute the entire agreement among the
parties and supersede all prior and contemporaneous agreements and undertakings
of the parties in connection herewith. No failure or delay of a party in
exercising any right, power or remedy may be, or may be deemed to be, a waiver
thereof; nor may any single or partial exercise of any right, power or remedy
preclude any other or further exercise of any right, power or remedy. In the
event that any one or more of the provisions contained in this Agreement, shall,
for any reason, be held to be invalid, illegal or unenforceable in any respect,
then to the maximum extent permitted by Law, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement. Each of
the parties hereto shall, at the request of the other party, deliver to the
requesting party all further documents or other assurances as may reasonably be
necessary or desirable in connection with this Agreement.

               (j) No Third Party Beneficiaries. This Agreement is not intended
to confer upon any Person other than the parties hereto (and the Holders with
respect to Sections 6(d), 6(e), and 6(f)) any rights or remedies.

                            [Signature Page Follows]

                                       12

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first written above.

                                        WEBSIDESTORY, INC.

                                        By: /s/ Jeffrey W. Lunsford
                                            ------------------------------------
                                        Name: Jeffrey W. Lunsford
                                        Title: Chief Executive Officer

                                        NED SCHERER,
                                        as Member Representative

                                        /s/ Ned Scherer
                                        ----------------------------------------

                                        U.S. STOCK TRANSFER CORPORATION

                                        By: /s/ William Garza
                                            ------------------------------------
                                        Name: William Garza
                                        Title: Vice President

                                       13

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