Document:

Exhibit 10.1

Exhibit 10.1

STEEL VAULT CORPORATION

2009 STOCK INCENTIVE PLAN

1. Purposes of the Plan. The purposes of this Stock Incentive Plan are to attract
and retain the best available personnel for positions of substantial responsibility,
to provide additional incentive to Employees and Consultants, and to promote the
long-term success of the Company’s business and to link participants’ directly to
stockholder interests through increased stock ownership. Awards granted under the
Plan may be Incentive Stock Options, Nonqualified Stock Options, Stock Appreciation
Rights, Restricted Stock Awards, Performance Units, Performance Shares, Cash Awards
and Other Stock Based Awards.

2. Definitions. As used herein, the following definitions shall apply:

(a) “Administrator” means the Board or any Committee or Officer as shall be
administering the Plan, in accordance with Section 4 of the Plan.

(b) “Affiliate” means a Parent, a Subsidiary, an entity that is not a Parent or
Subsidiary but which has a direct or indirect ownership interest in the Company or
in which the Company has a direct or indirect ownership interest, an entity that is
a customer or supplier of the Company, an entity that renders services to the
Company, or an entity that has an ownership or business affiliation with any entity
previously described in this Section 2(b).

(c) “Applicable Law” means the legal requirements relating to the
administration of the Plan under applicable federal, state, local and foreign
corporate, tax and securities laws, and the rules and requirements of any stock
exchange or quotation system on which the Common Stock is listed or quoted.

(d) “Award” means an Option, Stock Appreciation Right, Restricted Stock Award,
Performance Unit or Performance Share, Cash Award or Other Stock Based Award granted
under the Plan.

(e) “Award Agreement” means the agreement, notice and/or terms or conditions by
which an Award is evidenced, documented in such form (including by electronic
communication) as may be approved by the Administrator.

(f) “Board” means the Board of Directors of the Company.

(g) “Cash Award” means an award payable in the form of cash.

(h) “Change in Control” means the happening of any of the following:

(i) the consummation of any transaction (including, without limitation, any
merger or consolidation) the result of which is that any “person” as such term is
used in Section 13(d) and 14(d) of the Exchange Act (other than any trustee or other
fiduciary holding securities under any employee benefit plan of the Company, or any
company owned, directly or indirectly, by the shareholders of the Company in
substantially the same proportions as their ownership of stock of the Company), is
or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing more than 50% of
the combined voting power of the Company’s then outstanding securities entitled
generally to vote in the election of the Board (other than the occurrence of any
contingency);

(ii) the stockholders of the Company approve a merger or consolidation of the
Company with any other corporation or entity, which is consummated, other than a
merger or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting
securities of the surviving entity) more than 50% of the combined voting power
of the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation; or

(iii) the effective date of a complete liquidation of the Company or the
consummation of an agreement for the sale or disposition by the Company of all or
substantially all of the Company’s assets, which in both cases are approved by the
stockholders of the Company as may be required by law.

 

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(i) “Code” means the Internal Revenue Code of 1986, as amended.

(j) “Committee” means a committee appointed by the Board in accordance with
Section 4 of the Plan.

(k) “Compensation Committee” means the Compensation Committee of the Board.

(l) “Common Stock” means the common stock, $.01 par value, of the Company.

(m) “Company” means Steel Vault Corporation.

(n) “Consultant” means any person, including an advisor, engaged by the Company
or an Affiliate and who is compensated for such services, including without
limitation non-Employee Directors. In addition, as used herein, “consulting
relationship” shall be deemed to include service by a non-Employee Director as such.

(o) “Continuous Status as an Employee or Consultant” means that the employment
or consulting relationship is not interrupted or terminated by the Company or
Affiliate, as applicable. Continuous Status as an Employee or Consultant shall not
be considered interrupted in the case of (i) any leave of absence approved in
writing by the Board, an Officer, or a person designated in writing by the Board or
an Officer as authorized to approve a leave of absence, including sick leave,
military leave, or any other personal leave; provided, however, that for purposes of
Incentive Stock Options, any such leave may not exceed 90 days, unless reemployment
upon the expiration of such leave is guaranteed by contract (including certain
Company policies) or statute, or (ii) transfers between locations of the Company or
between the Company, a Parent, a Subsidiary or successor of the Company; or (iii) a
change in the status of the Grantee from Employee to Consultant or from Consultant
to Employee.

(p) “Covered Stock” means the Common Stock subject to an Award.

(q) “Date of Grant” means the date on which the Administrator makes the
determination granting the Award, or such other later date as is determined by the
Administrator. Notice of the determination shall be provided to each Grantee within
a reasonable time after the Date of Grant.

(r) “Date of Termination” means the date on which a Grantee’s Continuous Status
as an Employee or Consultant terminates.

(s) “Director” means a member of the Board or a member of the Board of
Directors of a Parent or Subsidiary.

(t) “Disability” means total and permanent disability as defined in
Section 22(e)(3) of the Code.

(u) “Employee” means any person, including Officers and Directors, employed by
the Company or any Affiliate. Neither service as a Director nor payment of a
director’s fee by the Company shall be sufficient to constitute “employment” by the
Company.

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

 

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(w) “Fair Market Value” means the value of a share of Common Stock. If the
Common Stock is actively traded on any national securities exchange, including, but
not limited to, the NASDAQ Stock Market or the New York Stock Exchange, Fair Market
Value shall mean the closing price at which sales of Common Stock shall have been
sold on the date of determination, as reported by any such exchange
selected by the Administrator on which the shares of Common Stock are then
traded. If the shares of Common Stock are not actively traded on any such exchange,
Fair Market Value shall mean the arithmetic mean of the bid and asked prices for the
 shares of Common Stock on the most recent trading date within a reasonable period
prior to the determination date as reported by such exchange. If there are no bid
and asked prices within a reasonable period or if the shares of Common Stock are not
traded on any exchange as of the determination date, Fair Market Value shall mean
the fair market value of a share of Common Stock as determined by the Administrator
taking into account such facts and circumstances deemed to be material by the
Administrator to the value of the Common Stock in the hands of the Grantee; provided
that, for purposes of granting awards other than Incentive Stock Options, Fair
Market Value of a share of Common Stock may be determined by the Administrator by
reference to the average market value determined over a period certain or as of
specified dates, to a tender offer price for the shares of Common Stock (if
settlement of an award is triggered by such an event) or to any other reasonable
measure of fair market value and provided further that, for purposes of granting
Incentive Stock Options, Fair Market Value of a share of Common Stock shall be
determined in accordance with the valuation principles described in the regulations
promulgated under Code Section 422.

(x) “Grantee” means an individual who has been granted an Award.

(y) “Incentive Stock Option” means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

(z) “Nonqualified Stock Option” means an Option not intended to qualify as an
Incentive Stock Option.

(aa) “Officer” means a person who is an officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations promulgated
thereunder.

(bb) “Option” means a stock option granted under the Plan.

(cc) “Other Stock Based Award” means an award that is valued in whole or in
part by reference to, or is otherwise based on, Common Stock.

(dd) “Parent” means a corporation, whether now or hereafter existing, in an
unbroken chain of corporations ending with the Company if each of the corporations
other than the Company holds at least 50 percent of the voting shares of one of the
other corporations in such chain.

(ee) “Performance Based Compensation” means compensation which meets the
requirements of Section 162(m)(4)(C) of the Code.

(ff) “Performance Based Restricted Stock” means an Award of Restricted Stock
which meets the requirements of Section 162(m)(4)(C) of the Code, as described in
Section 8(b) of the Plan.

(gg) “Performance Period” means the time period during which the performance
goals established by the Administrator with respect to a Performance Unit or
Performance Share, pursuant to Section 9 of the Plan, must be met.

(hh) “Performance Share” has the meaning set forth in Section 9 of the Plan.

(ii) “Performance Unit” has the meaning set forth in Section 9 of the Plan.

(jj) “Plan” means this Steel Vault Corporation 2009 Stock Incentive Plan, as
amended and restated.

(kk) “Restricted Stock Award” means Shares that are awarded to a Grantee
pursuant to Section 8 of the Plan.

(ll) “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any
successor to Rule 16b-3, as in effect when discretion is being exercised with
respect to the Plan.

 

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(mm) “Share” means a share of the Common Stock, as adjusted in accordance with
Section 13 of the Plan.

(nn) “Stock Appreciation Right” or “SAR” means the right to receive an amount
equal to the appreciation, if any, in the Fair Market Value of a Share from the date
of the grant of the right to the date of its payment, as set forth in Section 7 of
the Plan.

(oo) “Subsidiary” means a corporation, domestic or foreign, of which not less
than 50 percent 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.

3. Stock Subject to the Plan. Subject to the provisions of Section 13 of the Plan
and except as otherwise provided in this Section 3, the maximum aggregate number of
Shares that may be subject to Awards under the Plan since the Plan became effective
is 2,000,000 Shares, of which 2,000,000 can be issued as Incentive Stock Options.
The Shares may be authorized, but unissued, or reacquired Common Stock. If an Award
expires or becomes unexercisable without having been exercised in full the remaining
Shares that were subject to the Award shall become available for future Awards under
the Plan (unless the Plan has terminated). With respect to Options and Stock
Appreciation Rights, if the payment upon exercise of an Option or SAR is in the form
of Shares, the Shares subject to the Option or SAR shall be counted against the
available Shares as one Share for every Share subject to the Option or SAR,
regardless of the number of Shares used to settle the SAR upon exercise.

4. Administration of the Plan.

(a) Procedure.

(i) Multiple Administrative Bodies. The Plan may be administered by different
bodies with respect to different groups of Employees and Consultants, provided
however, that the administrative authority set forth in items (vii), (viii), (ix),
(xii), (xiii), (xiv), (xv), and (xvi) of Section 4(b) below shall be exercised only
by the Compensation Committee. Except as provided below, the Plan shall be
administered by (A) the Board or (B) a committee designated by the Board and
constituted to satisfy Applicable Law.

(ii) Rule 16b-3. To the extent the Board or the Compensation Committee
considers it desirable for transactions relating to Awards to be eligible to qualify
for an exemption under Rule 16b-3, the transactions contemplated under the Plan
shall be structured to satisfy the requirements for exemption under Rule 16b-3.

(iii) Section 162(m) of the Code. To the extent the Board or the Compensation
Committee considers it desirable for compensation delivered pursuant to Awards to be
eligible to qualify for an exemption from the limit on tax deductibility of
compensation under Section 162(m) of the Code, the transactions contemplated under
the Plan shall be structured to satisfy the requirements for exemption under Section
162(m) of the Code.

(iv) Authorization of Officers to Grant Options. In accordance with Applicable
Law, the Board may, by a resolution adopted by the Board, authorize one or more
Officers to designate Officers and Employees (excluding the Officer so authorized)
to be Grantees of Options and determine the number of Options to be granted to such
Officers and Employees; provided, however, that the resolution adopted by the Board
so authorizing such Officer or Officers shall specify the total number and the terms
(including the exercise price, which may include a formula by which such price may
be determined) of Options such Officer or Officers may so grant.

(b) Powers of the Administrator. Subject to the provisions of the Plan, and in
the case of a Committee or an Officer, subject to the specific duties delegated by
the Board to such Committee or Officer, the Administrator shall have the authority,
in its sole and absolute discretion:

(i) to determine the Fair Market Value of the Common Stock, in accordance with
Section 2(w) of the Plan;

(ii) to select the Grantees to whom Awards will be granted under the Plan;

 

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(iii) to determine whether, when, to what extent and in what types and amounts
Awards are granted under the Plan;

(iv) to determine the number of shares of Common Stock to be covered by each
Award granted under the Plan;

(v) to determine the forms of Award Agreements, which need not be the same for
each grant or for each Grantee, and which may be delivered electronically, for use
under the Plan;

(vi) to determine the terms and conditions, not inconsistent with the terms of
the Plan, of any Award granted under the Plan. Such terms and conditions, which need
not be the same for each grant or for each Grantee, include, but are not limited to,
the exercise price, the time or times when Options and SARs may be exercised (which
may be based on performance criteria), the extent to which vesting is suspended
during a leave of absence, any vesting acceleration or waiver of forfeiture
restrictions, and any restriction or limitation regarding any Award or the shares of
Common Stock relating thereto, based in each case on such factors as the
Administrator shall determine;

(vii) to construe and interpret the terms of the Plan and Awards;

(viii) to prescribe, amend and rescind rules and regulations relating to the
Plan, including, without limiting the generality of the foregoing, rules and
regulations relating to the operation and administration of the Plan to accommodate
the specific requirements of local and foreign laws and procedures;

(ix) to modify or amend each Award (subject to Section 15 of the Plan).
However, the Administrator may not modify or amend any outstanding Option or SAR to
reduce the exercise price of such Option or SAR, as applicable, below the exercise
price as of the Date of Grant of such Option or SAR. In addition, no Option or SAR
may be granted in exchange for, or in connection with, the cancellation or surrender
of an Option or SAR or other Award having a lower exercise price;

(x) to authorize any person to execute on behalf of the Company any instrument
required to effect the grant of an Award previously granted by the Administrator;

(xi) to determine the terms and restrictions applicable to Awards;

(xii) to make such adjustments or modifications to Awards granted to Grantees
who are Employees of foreign Subsidiaries as are advisable to fulfill the purposes
of the Plan or to comply with Applicable Law;

(xiii) to delegate its duties and responsibilities under the Plan with respect
to sub-plans applicable to foreign Subsidiaries, except its duties and
responsibilities with respect to Employees who are also Officers or Directors
subject to Section 16(b) of the Exchange Act;

(xiv) to provide any notice or other communication required or permitted by
the Plan in either written or electronic form;

(xv) to correct any defect or supply any omission, or reconcile any
inconsistency in the Plan, or in any Award Agreement, in the manner and to the
extent it shall deem necessary or expedient to make the Plan fully effective; and

(xvi) to make all other determinations deemed necessary or advisable for
administering the Plan.

(c) Effect of Administrator’s Decision. The Administrator’s decisions,
determinations and interpretations shall be final and binding on all Grantees and
any other holders of Awards.

 

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5. Eligibility and General Conditions of Awards.

(a) Eligibility. Awards other than Incentive Stock Options may be granted to
Employees and Consultants. Incentive Stock Options may be granted only to Employees.
If otherwise eligible, an Employee or Consultant who has been granted an Award may
be granted additional Awards.

(b) Maximum Term. Subject to the following provision, the term during which an
Award may be outstanding shall not extend more than ten years after the Date of
Grant, and shall be subject to earlier termination as specified elsewhere in the
Plan or Award Agreement.

(c) Award Agreement. To the extent not set forth in the Plan, the terms and
conditions of each Award, which need not be the same for each grant or for each
Grantee, shall be set forth in an Award Agreement. The Administrator, in its sole
and absolute discretion, may require as a condition to any Award Agreement’s
effectiveness that the Award Agreement be executed by the Grantee, including by
electronic signature or other electronic indication of acceptance, and that the
Grantee agree to such further terms and conditions as specified in the Award
Agreement. Except as otherwise provided in an Agreement, all capitalized terms used
in the Agreement shall have the same meaning as in the Plan, and the Agreement shall
be subject to all of the terms of the Plan.

(d) Termination of Employment or Consulting Relationship. In the event that a
Grantee’s Continuous Status as an Employee or Consultant terminates (other than upon
the Grantee’s Retirement (defined below), death, Disability, or Termination by
Employer Not for Cause (defined below)), then, unless otherwise provided by the
Award Agreement, and subject to Section 13 of the Plan:

(i) the Grantee may exercise his or her unexercised Option or SAR, but only
within such period of time as is determined by the Administrator, and only to the
extent that the Grantee was entitled to exercise it at the Date of Termination (but
in no event later than the expiration of the term of such Option or SAR as set forth
in the Award Agreement). In the case of an Incentive Stock Option, the Administrator
shall determine such period of time (in no event to exceed three months from the
Date of Termination) when the Option is granted. If, at the Date of Termination, the
Grantee is not entitled to exercise his or her entire Option or SAR, the Shares
covered by the unexercisable portion of the Option or SAR shall revert to the Plan.
If, after the Date of Termination, the Grantee does not exercise his or her Option
or SAR within the time specified by the Administrator, the Option or SAR shall
terminate, and the Shares covered by such Option or SAR shall revert to the Plan;

(ii) the Grantee’s Restricted Stock Awards, to the extent forfeitable
immediately before the Date of Termination, shall thereupon automatically be
forfeited;

(iii) the Grantee’s Restricted Stock Awards that were not forfeitable
immediately before the Date of Termination shall promptly be settled by delivery to
the Grantee of a number of unrestricted Shares equal to the aggregate number of the
Grantee’s vested Restricted Stock Awards; and

(iv) any Performance Shares or Performance Units with respect to which the
Performance Period has not ended as of the Date of Termination shall terminate
immediately upon the Date of Termination.

(e) Disability of Grantee. In the event that a Grantee’s Continuous Status as
an Employee or Consultant terminates as a result of the Grantee’s Disability, then,
unless otherwise provided by the Award Agreement, such termination shall have no
effect on the Grantee’s outstanding Awards. The Grantee’s Awards shall continue to
vest and remain outstanding and exercisable until they expire by their terms. In the
case of an Incentive Stock Option, any option not exercised within 12 months of the
date of termination of the Grantee’s Continuous Status as an Employee or Consultant
due to Disability will be treated as a Nonqualified Stock Option.

(f) Death of Grantee. In the event of the death of a Grantee, then, unless
otherwise provided by the Award Agreement, such termination shall have no effect on
Grantee’s outstanding Awards. The Grantee’s Awards shall continue to vest and remain
outstanding and exercisable until they expire by their terms. In the case of an
Incentive Stock Option, any option not exercised within 12 months of the date of
termination of Grantee’s Continuous Status as an Employee or Consultant due to death
will be treated as a Nonqualified Stock Option.

 

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(g) Retirement of Grantee. Except as otherwise provided in Section 5(g)(i)
below, in the event that a Grantee’s Continuous Status as an Employee or Consultant
terminates after the Grantee’s attainment of age 65 (hereinafter, “Retirement”),
then, unless otherwise provided by the Award Agreement, such termination shall have
no effect on Grantee’s outstanding Awards. The Grantee’s Awards shall continue to
vest and remain outstanding and exercisable until they expire by their terms. In the
case of an Incentive Stock Option, any option not exercised within 3 months of the
termination of Grantee’s Continuous Status as an Employee or Consultant due to
Retirement will be treated as a Nonqualified Stock Option.

(h) Termination by Employer Not for Cause. In the event that a Grantee’s
Continuous Status as an Employee or Consultant is terminated by the Employer without
Cause (hereinafter, “Termination by Employer Not for Cause”), then, unless otherwise
provided by the Award Agreement, such termination shall have no effect on Grantee’s
outstanding Awards. Grantee’s Awards shall continue to vest and remain outstanding
and exercisable until they expire by their terms. In the case of an Incentive Stock
Option, any option not exercised within 3 months of the date of will be treated as a
Nonqualified Stock Option. In the case of a Grantee who is a Director, the Grantee’s
service as a Director shall be deemed to have been terminated without Cause if the
Participant ceases to serve in such a position solely due to the failure to be
reelected or reappointed, as the case may be, and such failure is not a result of an
act or omission which would constitute Cause.

(i) Termination for Cause. Notwithstanding anything herein to the contrary, if
a Grantee is an Employee of the Company and is “Terminated for Cause”, as defined
herein below, or violates any of the terms of their employment after they have
become vested in any of their rights herein, the Grantee’s full interest in such
rights shall terminate on the date of such termination of employment and all rights
thereunder shall cease. Whether a Participant’s employment is Terminated for Cause
shall be determined by the Board. Cause shall mean gross negligence, willful
misconduct, flagrant or repeated violations of the Company’s policies, rules or
ethics, a material breach by the Grantee of any employment agreement between the
Grantee and the Company, intoxication, substance abuse, sexual or other unlawful
harassment, disclosure of confidential or proprietary information, engaging in a
business competitive with the Company, or dishonest, illegal or immoral conduct.

(j) Nontransferability of Awards.

(i) Except as provided in Section 5(j)(iii) below, each Award, and each right
under any Award, shall be exercisable only by the Grantee during the Grantee’s
lifetime, or, if permissible under Applicable Law, by the Grantee’s guardian or
legal representative.

(ii) Except as provided in Section 5(j)(iii) below, no Award (prior to the
time, if applicable, Shares are issued in respect of such Award), and no right under
any Award, may be assigned, alienated, pledged, attached, sold or otherwise
transferred or encumbered by a Grantee otherwise than by will or by the laws of
descent and distribution (or in the case of Restricted Stock Awards, to the Company)
and any such purported assignment, alienation, pledge, attachment, sale, transfer or
encumbrance shall be void and unenforceable against the Company or any Subsidiary;
provided, that the designation of a beneficiary shall not constitute an assignment,
alienation, pledge, attachment, sale, transfer or encumbrance.

(iii) To the extent and in the manner permitted by Applicable Law, and to the
extent and in the manner permitted by the Administrator, and subject to such terms
and conditions as may be prescribed by the Administrator, a Grantee may transfer an
Award to:

(A) a child, stepchild, grandchild, parent, stepparent, grandparent, spouse,
former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law of the Grantee (including adoptive
relationships);

(B) any person sharing the employee’s household (other than a tenant or
employee);

(C) a trust in which persons described in (A) and (B) have more than 50 percent
of the beneficial interest;

 

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(D) a foundation in which persons described in (A) or (B) or the Grantee
control the management of assets; or

(E) any other entity in which the persons described in (A) or (B) or the
Grantee own more than 50 percent of the voting interests;

provided such transfer is not for value. The following shall not be considered
transfers for value: a transfer under a domestic relations order in settlement of
marital property rights, and a transfer to an entity in which more than 50 percent
of the voting interests are owned by persons described in (A) above or the Grantee,
in exchange for an interest in such entity.

6. Stock Options.

(a) Limitations.

(i) Each Option shall be designated in the Award Agreement as either an
Incentive Stock Option or a Nonqualified Stock Option. Any Option designated as an
Incentive Stock Option:

(A) shall not have an aggregate Fair Market Value (determined for each
Incentive Stock Option at the Date of Grant) of Shares with respect to which
Incentive Stock Options are exercisable for the first time by the Grantee during any
calendar year (under the Plan and any other employee stock option plan of the
Company or any Parent or Subsidiary (“Other Plans”)), determined in accordance with
the provisions of Section 422 of the Code, that exceeds $100,000 (the “$100,000
Limit”);

(B) shall, if the aggregate Fair Market Value of Shares (determined on the Date
of Grant) with respect to the portion of such grant that is exercisable for the
first time during any calendar year (“Current Grant”) and all Incentive Stock
Options previously granted under the Plan and any Other Plans that are exercisable
for the first time during a calendar year (“Prior Grants”) would exceed the $100,000
Limit, be exercisable as follows:

(1) The portion of the Current Grant that would, when added to any Prior
Grants, be exercisable with respect to Shares that would have an aggregate Fair
Market Value (determined as of the respective Date of Grant for such Options) in
excess of the $100,000 Limit shall, notwithstanding the terms of the Current Grant,
be exercisable for the first time by the Grantee in the first subsequent calendar
year or years in which it could be exercisable for the first time by the Grantee
when added to all Prior Grants without exceeding the $100,000 Limit; and

(2) If, viewed as of the date of the Current Grant, any portion of a Current
Grant could not be exercised under the preceding provisions of this
Section 6(a)(i)(B) during any calendar year commencing with the calendar year in
which it is first exercisable through and including the last calendar year in which
it may by its terms be exercised, such portion of the Current Grant shall not be an
Incentive Stock Option, but shall be exercisable as a separate Option at such date
or dates as are provided in the Current Grant.

(ii) No Employee shall be granted, in any fiscal year of the Company, Options
to purchase more than 1,000,000 Shares. The limitation described in this
Section 6(a)(ii) shall be adjusted proportionately in connection with any change in
the Company’s capitalization as described in Section 13 of the Plan. If an Option is
canceled in the same fiscal year of the Company in which it was granted (other than
in connection with a transaction described in Section 13 of the Plan), the canceled
Option will be counted against the limitation described in this Section 6(a)(ii).

(b) Term of Option. The term of each Option shall be stated in the Award
Agreement; provided, however, that the term shall be 10 years from the date of grant
or such shorter term as may be provided in the Award Agreement. Moreover, in the
case of an Incentive Stock Option granted to a Grantee who, at the time the
Incentive Stock Option is granted, owns stock representing more than 10 percent of
the voting power of all classes of stock of the Company or any Parent or Subsidiary,
the term of the Incentive Stock Option shall be five years from the date of grant or
such shorter term as may be provided in the Award Agreement.

 

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(c) Option Exercise Price and Consideration.

(i) Exercise Price. The per share exercise price for the Shares to be issued
pursuant to exercise of an Option shall be determined by the Administrator and,
except as otherwise provided in this Section 6(c)(i), shall be no less than
100 percent of the Fair Market Value per Share on the Date of Grant.

(A) In the case of an Incentive Stock Option granted to an Employee who on the
Date of Grant owns stock representing more than 10 percent of the voting power of
all classes of stock of the Company or any Parent or Subsidiary, the per Share
exercise price shall be no less than 110 percent of the Fair Market Value per Share
on the Date of Grant.

(B) Any Option that is (1) granted to a Grantee in connection with the
acquisition (“Acquisition”), however effected, by the Company of another corporation
or entity (“Acquired Entity”) or the assets thereof, (2) associated with an option
to purchase shares of stock or other equity interest of the Acquired Entity or an
affiliate thereof (“Acquired Entity Option”) held by such Grantee immediately prior
to such Acquisition, and (3) intended to preserve for the Grantee the economic value
of all or a portion of such Acquired Entity Option, may be granted with such
exercise price as the Administrator determines to be necessary to achieve such
preservation of economic value.

(d) Waiting Period and Exercise Dates. At the time an Option is granted, the
Administrator shall fix the period within which the Option may be exercised and
shall determine any conditions that must be satisfied before the Option may be
exercised. An Option shall be exercisable only to the extent that it is vested
according to the terms of the Award Agreement.

(e) Form of Consideration. The Administrator shall determine the acceptable
form of consideration for exercising an Option, including the method of payment. In
the case of an Incentive Stock Option, the Administrator shall determine the
acceptable form of consideration at the time of grant. The acceptable form of
consideration may consist of any combination of the following: cash; pursuant to
procedures approved by the Administrator, through the sale of the Shares acquired on
exercise of the Option through a broker-dealer to whom the Grantee has submitted an
irrevocable notice of exercise and irrevocable instructions to deliver promptly to
the Company the amount of sale or loan proceeds sufficient to pay the exercise
price, together with, if requested by the Company, the amount of federal, state,
local or foreign withholding taxes payable by the Grantee by reason of such exercise
(a “cashless exercise”) or; subject to the approval of the Administrator:

(i) by the surrender of all or part of an Award (including the Award being
exercised);

(ii) by the tender to the Company of Shares owned by the Grantee and registered
in his name having a Fair Market Value equal to the amount due to the Company;

(iii) in other property, rights and credits deemed acceptable by the
Administrator, including the Participant’s promissory note; or

(iv) such other consideration and method of payment for the issuance of Shares
to the extent permitted by Applicable Law and deemed acceptable by the
Administrator.

(f) Exercise of Option.

(i) Procedure for Exercise; Rights as a Shareholder.

(A) Any Option granted hereunder shall be exercisable according to the terms of
the Plan and at such times and under such conditions as determined by the
Administrator and set forth in the Award Agreement.

(B) An Option may not be exercised for a fraction of a Share.

 

9

 

(C) An Option shall be deemed exercised when the Company receives:

(1) written or electronic notice of exercise (in accordance with the Award
Agreement and any action taken by the Administrator pursuant to Section 4(b) of the
Plan or otherwise) from the person entitled to exercise the Option, and

(2) full payment for the Shares with respect to which the Option is exercised.

(D) Shares issued upon exercise of an Option shall be issued in the name of the
Grantee or, if requested by the Grantee, in the name of the Grantee and his or her
spouse. Until the stock certificate evidencing such Shares is issued (as evidenced
by the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company), no right to vote or receive dividends or any other
rights as a shareholder shall exist with respect to the Optioned Stock,
notwithstanding the exercise of the Option. The Company shall issue (or cause to be
issued) such stock certificate promptly after the Option is exercised. No adjustment
will be made for a dividend or other right for which the record date is prior to the
date the stock certificate is issued, except as provided in Section 13 of the Plan.

(E) Exercising an Option in any manner shall decrease the number of Shares
thereafter available, both for purposes of the Plan and for sale under the Option,
by the number of Shares as to which the Option is exercised.

7. Stock Appreciation Rights.

(a) Grant of SARs. Subject to the terms and conditions of the Plan, the
Administrator may grant SARs in tandem with an Option or alone and unrelated to an
Option. Tandem SARs shall expire no later than the expiration of the underlying
Option. In no event shall the term of a SAR exceed ten years from the Date of Grant.

(b) Exercise of SARs. SARs shall be exercised by the delivery of a written or
electronic notice of exercise (in accordance with the Award Agreement and any action
taken by the Administrator pursuant to Section 4(b) of the Plan or otherwise),
setting forth the number of Shares over which the SAR is to be exercised. Tandem
SARs may be exercised:

(i) with respect to all or part of the Shares subject to the related Option
upon the surrender of the right to exercise the equivalent portion of the related
Option;

(ii) only with respect to the Shares for which its related Option is then
exercisable; and

(iii) only when the Fair Market Value of the Shares subject to the Option
exceeds the exercise price of the Option.

The value of the payment with respect to the tandem SAR may be no more than
100 percent of the difference between the exercise price of the underlying Option
and the Fair Market Value of the Shares subject to the underlying Option at the time
the tandem SAR is exercised.

(c) Payment of SAR Benefit. Upon exercise of a SAR, the Grantee shall be
entitled to receive payment from the Company in an amount determined by multiplying:

(i) the excess of the Fair Market Value of a Share on the date of exercise over
the SAR exercise price; by

(ii) the number of Shares with respect to which the SAR is exercised;

provided, that the Administrator may provide in the Award Agreement that the benefit
payable on exercise of a SAR shall not exceed such percentage of the Fair Market
Value of a Share on the Date of Grant, or any other limitation, as the Administrator
shall specify. The payment upon exercise of a SAR shall be in Shares that have an
aggregate Fair Market Value (as of the date of exercise of the SAR) equal to the
amount of the payment.

 

10

 

(d) No Employee shall be granted, in any fiscal year, SARs with respect to more
than 1,000,000 Shares. The limitation described in this Section 7(d) shall be
adjusted proportionately in connection with
any change in the Company’s capitalization as described in Section 13 of the
Plan. If a SAR is canceled in the same fiscal year of the Company in which it was
granted (other than in connection with a transaction described in Section 13 of the
Plan), the canceled SAR will be counted against the limitation described in this
Section 7(d).

8. Restricted Stock Awards. Subject to the terms of the Plan, the Administrator may
grant Restricted Stock Awards to any Eligible Recipient, in such amount and upon
such terms and conditions as shall be determined by the Administrator.

(a) Administrator Action. The Administrator acting in its sole and absolute
discretion shall have the right to grant Restricted Stock to Eligible Recipients
under the Plan from time to time. Each Restricted Stock Award shall be evidenced by
a Restricted Stock Agreement, and each Restricted Stock Agreement shall set forth
the conditions, if any, which will need to be timely satisfied before the grant will
be effective and the conditions, if any, under which the Grantee’s interest in the
related Stock will be forfeited. The Administrator may make grants of
Performance-Based Restricted Stock and grants of Restricted Stock that are not
Performance-Based Restricted Stock; provided, however, that only the Compensation
Committee may serve as the Administrator with respect to grants of Performance-Based
Restricted Stock.

(b) Performance-Based Restricted Stock.

(i) Effective Date. A grant of Performance-Based Restricted Stock shall be
effective as of the date the Compensation Committee certifies that the applicable
conditions described in Section 8(b)(iii) of the Plan have been timely satisfied.

(ii) Share Limitation. No more than 1,000,000 shares of Performance-Based
Restricted Stock may be granted to an Eligible Recipient in any calendar year.

(iii) Grant Conditions. The Compensation Committee, acting in its sole and
absolute discretion, may select from time to time Eligible Recipients to receive
grants of Performance-Based Restricted Stock in such amounts as the Compensation
Committee may, in its sole and absolute discretion, determine, subject to any
limitations provided in the Plan. The Compensation Committee shall make each grant
subject to the attainment of certain performance targets. The Compensation Committee
shall determine the performance targets which will be applied with respect to each
grant of Performance-Based Restricted Stock at the time of grant, but in no event
later than 90 days after the commencement of the period of service to which the
performance targets relate. The performance criteria applicable to Performance-Based
Restricted Stock grants will be one or more of the following criteria: (1) stock
price; (2) average annual growth in earnings per share; (3) increase in shareholder
value; (4) earnings per share; (5) net income; (6) return on assets; (7) return on
shareholders’ equity; (8) increase in cash flow; (9) operating profit or operating
margins; (10) revenue growth of the Company; and (11) operating expenses. Each
performance target applicable to a Cash Award intended to be Performance Based
Compensation and the deadline for satisfying each such target shall be stated in the
Agreement between the Company and the Employee. The Compensation Committee must
certify in writing that each such target has been satisfied before the Performance
Based Compensation award is paid.

The related Restricted Stock Agreement shall set forth the applicable performance
criteria and the deadline for satisfying the performance criteria.

(iv) Forfeiture Conditions. The Compensation Committee may make each
Performance-Based Restricted Stock grant (if, when and to the extent that the grant
becomes effective) subject to one, or more than one, objective employment,
performance or other forfeiture condition which the Compensation Committee acting in
its sole and absolute discretion deems appropriate under the circumstances for
Eligible Recipients generally or for a Grantee in particular, and the related
Restricted Stock Agreement shall set forth each such condition and the deadline for
satisfying each such forfeiture condition. A Grantee’s nonforfeitable interest in
the Shares related to a Performance-Based Restricted Stock grant shall depend on the
extent to which each such condition is timely satisfied. A Stock certificate shall
be issued (subject to the conditions, if any, described in this Section 8(b)) to, or
for the benefit of, the Grantee with respect to the number of shares for which a
grant has become effective as soon as practicable after the date the grant becomes
effective.

 

11

 

(c) Restricted Stock Other Than Performance-Based Restricted Stock.

(i) Effective Date. A Restricted Stock grant which is not a grant of
Performance-Based Restricted Stock shall be effective (a) as of the date set by the
Administrator when the grant is made or, if the grant is made subject to one, or
more than one, condition, (b) as of the date the Administrator determines that such
conditions have been timely satisfied.

(ii) Grant Conditions. The Administrator acting in its sole and absolute
discretion may make the grant of Restricted Stock which is not Performance-Based
Restricted Stock to a Grantee subject to the satisfaction of one, or more than one,
objective employment, performance or other grant condition which the Administrator
deems appropriate under the circumstances for Eligible Recipients generally or for a
Grantee in particular, and the related Restricted Stock Agreement shall set forth
each such condition and the deadline for satisfying each such grant condition.

(iii) Forfeiture Conditions. The Administrator may make each grant of
Restricted Stock which is not a grant of Performance-Based Restricted Stock (if,
when and to the extent that the grant becomes effective) subject to one, or more
than one, objective employment, performance or other forfeiture condition which the
Administrator acting in its sole and absolute discretion deems appropriate under the
circumstances for Eligible Recipients generally or for a Grantee in particular, and
the related Restricted Stock Agreement shall set forth each such condition and the
deadline for satisfying each such forfeiture condition. A Grantee’s nonforfeitable
interest in the Shares related to a grant of Restricted Stock which is not a grant
of Performance-Based Restricted Stock shall depend on the extent to which each such
condition is timely satisfied. A Stock certificate shall be issued (subject to the
conditions, if any, described in this Section 8(c)) to, or for the benefit of, the
Grantee with respect to the number of shares for which a grant has become effective
as soon as practicable after the date the grant becomes effective.

(d) Dividends and Voting Rights. Each Restricted Stock Agreement shall state
whether the Grantee shall have a right to receive any cash dividends which are paid
with respect to his or her Restricted Stock after the date his or her Restricted
Stock grant has become effective and before the first day that the Grantee’s
interest in such stock is forfeited completely or becomes completely nonforfeitable.
If a Restricted Stock Agreement provides that a Grantee has no right to receive a
cash dividend when paid, such agreement shall set forth the conditions, if any,
under which the Grantee will be eligible to receive one, or more than one, payment
in the future to compensate the Grantee for the fact that he or she had no right to
receive any cash dividends on his or her Restricted Stock when such dividends were
paid. If a Restricted Stock Agreement calls for any such payments to be made, the
Company shall make such payments from the Company’s general assets, and the Grantee
shall be no more than a general and unsecured creditor of the Company with respect
to such payments. If a stock dividend is declared on such a Share after the grant is
effective but before the Grantee’s interest in such Stock has been forfeited or has
become nonforfeitable, such stock dividend shall be treated as part of the grant of
the related Restricted Stock, and a Grantee’s interest in such stock dividend shall
be forfeited or shall become nonforfeitable at the same time as the Share with
respect to which the stock dividend was paid is forfeited or becomes nonforfeitable.
If a dividend is paid other than in cash or stock, the disposition of such dividend
shall be made in accordance with such rules as the Administrator shall adopt with
respect to each such dividend. A Grantee shall have the right to vote the Shares
related to his or her Restricted Stock grant after the grant is effective with
respect to such Shares but before his or her interest in such Shares has been
forfeited or has become nonforfeitable.

(e) Satisfaction of Forfeiture Conditions. A Share shall cease to be Restricted
Stock at such time as a Grantee’s interest in such Share becomes nonforfeitable
under the Plan, and the certificate representing such share shall be reissued as
soon as practicable thereafter without any further restrictions related to Section
8(b) or Section 8(c) and shall be transferred to the Grantee.

 

12

 

9. Performance Units and Performance Shares.

(a) Grant of Performance Units and Performance Shares. Subject to the terms of
the Plan, the Administrator may grant Performance Units or Performance Shares to any
Eligible Recipient in such amounts and upon such terms as the Administrator shall
determine.

(b) Value/Performance Goals. Each Performance Unit shall have an initial value
that is established by the Administrator on the Date of Grant. Each Performance
Share shall have an initial value equal to the Fair Market Value of a Share on the
Date of Grant. The Administrator shall set performance goals that, depending upon
the extent to which they are met, will determine the number or value of Performance
Units or Performance Shares that will be paid to the Grantee.

(c) Payment of Performance Units and Performance Shares.

(i) Subject to the terms of the Plan, after the applicable Performance Period
has ended, the holder of Performance Units or Performance Shares shall be entitled
to receive a payment based on the number and value of Performance Units or
Performance Shares earned by the Grantee over the Performance Period, to the extent
the corresponding performance goals have been achieved.

(ii) If a Grantee is promoted, demoted or transferred to a different business
unit of the Company during a Performance Period, then, to the extent the
Administrator determines appropriate, the Administrator may adjust, change or
eliminate the performance goals or the applicable Performance Period as it deems
appropriate in order to make them appropriate and comparable to the initial
performance goals or Performance Period.

(d) Form and Timing of Payment of Performance Units and Performance Shares.
Payment of earned Performance Units or Performance Shares shall be made in a lump
sum following the close of the applicable Performance Period. The Administrator may
pay earned Performance Units or Performance Shares in cash or in Shares (or in a
combination thereof) that have an aggregate Fair Market Value equal to the value of
the earned Performance Units or Performance Shares at the close of the applicable
Performance Period. Such Shares may be granted subject to any restrictions deemed
appropriate by the Administrator. The form of payout of such Awards shall be set
forth in the Award Agreement pertaining to the grant of the Award.

10. Cash Awards. The Administrator may grant Cash Awards at such times and in such
amounts as it deems appropriate.

(a) Annual Limits. Notwithstanding the foregoing, the amount of any Cash Award
in any Fiscal Year to any Grantee shall not exceed the greater of $100,000 or 100%
of his cash compensation (excluding any Cash Award under the Plan) for such Fiscal
Year.

(b) Restrictions. Cash Awards may be subject or not subject to conditions (such
as an investment requirement), restricted or nonrestricted, vested or subject to
forfeiture and may be payable currently or in the future or both. The Administrator
may make grants of Cash Awards that are intended to be Performance Based
Compensation and grants of Cash Awards that are not intended to be Performance Based
Compensation; provided, however, that only the Compensation Committee may serve as
the Administrator with respect to grants of Cash Awards that are intended to be
Performance-Based Compensation.

The Compensation Committee shall determine the performance targets which will be
applied with respect to each grant of Cash Awards that are intended to be
Performance Based Compensation at the time of grant, but in no event later than
90 days after the beginning of the period of service to which the performance
targets relate. The performance criteria applicable to Performance Based
Compensation awards will be one or more of the following: (1) stock price;
(2) average annual growth in earnings per share; (3) increase in shareholder value;
(4) earnings per share; (5) net income; (6) return on assets; (7) return on
shareholders’ equity; (8) increase in cash flow; (9) operating profit or operating
margins; (10) revenue growth of the Company; and (11) operating expenses. Each
performance target applicable to a Cash Award intended to be Performance Based
Compensation and the deadline for satisfying each such target shall be stated in the
Agreement between the Company and the Employee. The Compensation Committee must
certify in writing that each such target has been satisfied before the Performance
Based Compensation award is paid.

 

13

 

11. Other Stock Based Awards. The Administrator shall have the right to grant Other
Stock Based Awards which may include, without limitation, the grant of Shares based
on certain conditions, the
payment of cash based on the performance of the Common Stock, and the grant of
securities convertible into Shares.

12. Tax Withholding. The Company shall deduct from all cash distributions under the
Plan any taxes required to be withheld by federal, state, local or foreign
government. Whenever the Company proposes or is required to issue or transfer Shares
under the Plan, the Company shall have the right to require the recipient to remit
to the Company an amount sufficient to satisfy any federal, state, local and foreign
withholding tax requirements prior to the delivery of any certificate or
certificates for such shares. A Grantee may pay the withholding tax in cash, or, if
the applicable Award Agreement provides, a Grantee may elect to have the number of
Shares he is to receive reduced by the smallest number of whole Shares that, when
multiplied by the Fair Market Value of the Shares determined as of the Tax Date
(defined below), is sufficient to satisfy federal, state, local and foreign, if any,
withholding taxes arising from exercise or payment of a grant under the Plan (a
“Withholding Election”). A Grantee may make a Withholding Election only if the
Withholding Election is made on or prior to the date on which the amount of tax
required to be withheld is determined (the “Tax Date”) by executing and delivering
to the Company a properly completed notice of Withholding Election as prescribed by
the Administrator. The Administrator may in its sole and absolute discretion
disapprove and give no effect to the Withholding Election.

13. Adjustments Upon Changes in Capitalization or Change in Control.

(a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of Covered Shares, and the number of shares
of Common Stock which have been authorized for issuance under the Plan but as to
which no Awards have yet been granted or which have been returned to the Plan upon
cancellation or expiration of an Award, as well as the price per share of Covered
Stock, 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 issued 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
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 Covered Stock.

(b) Change in Control. In the event of a Change in Control, then the following
provisions shall apply:

(i) all outstanding Options shall become fully exercisable, except to the
extent that the right to exercise the Option is subject to restrictions established
in connection with a SAR that is issued in tandem with the Option;

(ii) all outstanding SARs shall become immediately payable, except to the
extent that the right to exercise the SAR is subject to restrictions established in
connection with an Option that is issued in tandem with the SAR;

(iii) all Shares of Restricted Stock shall become fully vested;

(iv) all Performance Shares and Performance Units shall be deemed to be fully
earned and shall be paid out in such manner as determined by the Compensation
Committee; and

(v) all Cash Awards, Other Stock Based Awards and other Awards shall become
fully vested and/or earned and paid out in such manner as determined by the
Compensation Committee.

In addition to the provisions of Section 13(b) above and to the extent not
inconsistent therewith the Compensation Committee, in its sole discretion, may:
(1) provide for the purchase of any Award for an amount of cash equal to the amount
which could have been attained upon the exercise or realization of such Award had
such Award been currently exercisable or payable; (2) make such adjustment to the
Awards then outstanding as the Compensation Committee deems appropriate to reflect
such transaction or change; and/or (3) cause the Awards then outstanding to be
assumed, or new Awards substituted therefore, by the surviving corporation in such
change.

 

14

 

14. Term of Plan. The Plan shall become effective upon its approval by the
shareholders of the Company. Such shareholder approval shall be obtained in the
manner and to the degree required under applicable federal and state law. The Plan
shall continue in effect until the tenth anniversary of adoption of the Plan by the
Board, unless terminated earlier under Section 15 of the Plan.

15. Amendment and Termination of the Plan.

(a) Amendment and Termination. The Board may at any time amend, alter, suspend
or terminate the Plan.

(b) Shareholder Approval. The Company shall obtain shareholder approval of any
Plan amendment to the extent necessary and desirable to comply with Rule 16b-3 or
with Section 422 or Section 162(m) of the Code (or any successor rule or statute) or
other Applicable Law. Such shareholder approval, if required, shall be obtained in
such a manner and to such a degree as is required by the Applicable Law.

(c) Effect of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan shall impair the rights of any Grantee, unless mutually
agreed otherwise between the Grantee and the Administrator, which agreement must be
in writing and signed by the Grantee and the Company.

16. Conditions Upon Issuance of Shares.

(a) Legal Compliance. Shares shall not be issued pursuant to an Award unless
the exercise, if applicable, of such Award and the issuance and delivery of such
Shares shall comply with all relevant provisions of law, including, without
limitation, the Securities Act of 1933, as amended, the Exchange Act, the rules and
regulations promulgated thereunder, Applicable Law, and the requirements of any
stock exchange or quotation system upon which the Shares may then be listed or
quoted, and any insider trading policy adopted by the Company, and shall be further
subject to the approval of counsel for the Company with respect to such compliance.

(b) Investment Representations. As a condition to the exercise of an Award, the
Company may require the person exercising such Award 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.

17. Liability of Company.

(a) Inability to Obtain Authority. The inability of the Company to obtain
authority from any regulatory body having jurisdiction, which authority is deemed by
the Company’s counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, shall relieve the Company of any liability in respect of the failure to
issue or sell such Shares as to which such requisite authority shall not have been
obtained.

(b) Grants Exceeding Allotted Shares. If the Covered Stock covered by an Award
exceeds, as of the date of grant, the number of Shares that may be issued under the
Plan without additional shareholder approval, such Award shall be void with respect
to such excess Covered Stock, unless shareholder approval of an amendment
sufficiently increasing the number of Shares subject to the Plan is timely obtained
in accordance with Section 15 of the Plan.

18. Reservation of Shares. The Company, during the term of the Plan, will at all
times reserve and keep available such number of Shares as shall be sufficient to
satisfy the requirements of the Plan.

 

15

 

19. Rights of Employees. Neither the Plan nor any Award shall confer upon a Grantee
any right with respect to continuing the Grantee’s employment relationship with the
Company, nor shall they interfere in
any way with the Grantee’s right or the Company’s right to terminate such employment
relationship at any time, with or without cause.

20. Sub-plans for Foreign Subsidiaries. The Board may adopt sub-plans applicable to
particular foreign Subsidiaries. All Awards granted under such sub-plans shall be
treated as grants under the Plan. The rules of such sub-plans may take precedence
over other provisions of the Plan, with the exception of Section 3, but unless
otherwise superseded by the terms of such sub-plan, the provisions of the Plan shall
govern the operation of such sub-plan.

21. Construction. The Plan shall be construed under the laws of the State of
Delaware, to the extent not preempted by federal law, without reference to the
principles of conflict of laws.

22. Certain Limitations on Awards to Ensure Compliance with Code Section 409A. For
purposes of this Plan, references to an award term or event (including any authority
or right of the Company or a Grantee) being “permitted” under Code Section 409A
mean, for a 409A Award (meaning an Award that constitutes a deferral of compensation
under Code Section 409A and regulations thereunder), that the term or event will not
cause the Grantee to be liable for payment of interest or a tax penalty under Code
Section 409A and, for a Non-409A Award (meaning all Awards other than 409A Awards),
that the term or event will not cause the Award to be treated as subject to Code
Section 409A. Other provisions of the Plan notwithstanding, the terms of any 409A
Award and any Non-409A Award, including any authority of the Company and rights of
the Grantee with respect to the Award, shall be limited to those terms permitted
under Code Section 409A, and any terms not permitted under Code Section 409A shall
be automatically modified and limited to the extent necessary to conform with Code
Section 409A. For this purpose, other provisions of the Plan notwithstanding, the
Company shall have no authority to accelerate distributions relating to 409A Awards
in excess of the authority permitted under Code Section 409A, and any distribution
subject to Code
Section 409A(a)(2)(A)(i) (separation from service) to a “key
employee” as defined under Code Section 409A(a)(2)(B)(i), shall not occur earlier
than the earliest time permitted under Code Section 409A(a)(2)(B)(i).

 

16Exhibit 10.2

Exhibit 10.2

***CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

JOINT MARKETING AGREEMENT

This Joint Marketing Agreement (“Agreement”) is effective as of the 11th day of May 2009
(“Effective Date”), by and between NationalCreditReport.com, L.L.C. (“NCRC”), with its principal
place of business at 1690 South Congress Ave, Suite 200 Delray Beach, FL 33445 and First Advantage
Membership Services, Inc. (“FAMS”) with its principle place of business at 12395 First American
Way, Poway, CA 92064. In consideration of the mutual agreements of the parties herein and the
benefits each expects to derive hereunder, the parties agree as follows:

MARKETING, FAMS REPORTS, AND RELATED MATTERS

1.1 FAMS Reports and Marketing Activities. NCRC will market FAMS’s consumer reports, credit
reporting monitoring services and credit scores (together, “FAMS Reports”) as part of NCRC’s
products and services (the “Services”) directly to consumers who are the subjects of such reports
(“Consumer Users”). The FAMS Reports will be provided directly by First Advantage Credco
(“Credco”), and an affiliate of FAMS that is a consumer reporting agency. If NCRC’s web site is
used as a mechanism for placing orders for FAMS Reports, NCRC agrees to comply with the
requirements set forth in Exhibit A-1, attached hereto and incorporated herein by reference. NCRC
may not market or place orders for, FAMS Reports through any third party website unless FAMS first
agrees in writing in each specific case.

NCRC will market the FAMS Reports pursuant to methods agreed upon in writing by NCRC and FAMS.
NCRC will provide FAMS the opportunity to review and approve all marketing materials in connection
with FAMS Reports proposed to be used by NCRC (including all material changes to materials
previously approved by FAMS) at least three (3) business days prior to use, publication, or
release, and will make any changes requested by FAMS. FAMS will not unreasonably withhold
approval. NCRC shall bear all marketing costs and expenses of all marketing of FAMS Reports.

1.2 Format of FAMS Reports. FAMS Reports will be provided in an HTML format. NCRC agrees
to publish the Credit Report Acceptance of Terms (Exhibit A-2) on their web site related to the
ordering of FAMS Reports.

1.3 Restriction on Use of FAMS Reports. FAMS Reports will be provided to Consumer Users
solely for their personal use. Consumer Users must give written instructions for FAMS/CREDCO to
provide FAMS Reports as part of NCRC’s products and services they have ordered (“Consumer User
Instructions”). If the Consumer User Instructions are given in electronic format, the electronic
authorization must (a) comply with the requirements set forth in Exhibit A-3, attached hereto, and
incorporated herein by reference, be in a form that (b) be capable of being retained for later
reference, (c) clearly evidence Consumers User’s instructions to obtain the FAMS Report, and (d)
comply with all applicable federal and state laws and regulations. NCRC shall retain copies of all
Consumer User Instructions for at least five (5) years, and FAMS, at its own expense, shall have
the right, during normal business hours and with reasonable prior written notice, to audit and make
copies of such instructions. Within seven (7) business days after receipt of FAMS’s written
request, NCRC shall promptly provide FAMS samples of the Consumer User Instructions or specific
Consumer User Instructions, as specified by FAMS. Prior to destroying any Consumer User
Instructions, NCRC shall notify FAMS of its intent to take such action and, if requested by FAMS,
shall deliver such instructions to FAMS, at FAMS’s expense. NCRC agrees to (a) implement
sufficient procedures and controls to assure that FAMS Reports are ordered only by the subject of
the report and to take reasonable steps to detect and prevent fraud in connection with such orders,
(b) accurately provide FAMS with the Consumer User identifying information as received by NCRC, and
(c) assure the accuracy of such identifying information.

1.4 Compliance. NCRC agrees to adhere to the requirements mandated by the national credit
repositories (Experian, Equifax and Trans Union, hereinafter referred to as the “Repository(s)”)
including any new requirements that are mandated by the Repositories, in connection with the FAMS
Reports. NCRC also agrees to adhere to all applicable regulatory requirements. NCRC agrees to
respond to any written objection pertaining to NCRC controllable issues from any Repository
relating, but not limited to the marketing, publication, release, use or sale of FAMS Reports.
NCRC shall make such response directly to FAMS and NCRC will, in good faith, make every reasonable
effort to assist FAMS to get the objecting Repository to agree to waive the objection, or NCRC will
change what is objected to in order to comply with Repository requirements. If NCRC is unable to
change what is objected by the Repository(s), then this Agreement will terminate immediately. In no
event will FAMS have any obligation to provide any FAMS Reports if FAMS determines, under advice of
independent counsel and having given NCRC a reasonable notice to cure (not to exceed thirty (30)
days), that providing such report may cause FAMS or CREDCO to violate the Fair Credit Reporting Act
or any other applicable law or require FAMS or CREDCO to violate any of their agreements with the
Repositories.

 

 

 

1.5 Site Availability. FAMS shall maintain its own system that accesses FAMS Reports for
delivery to Consumer Users. This system processes FAMS Report orders and delivers them to the
Consumer User. NCRC shall be responsible for displaying the FAMS Reports for Consumers Users as
defined in Exhibit A-2. NCRC shall be solely responsible for maintaining its systems, interface
and web site in order for NCRC to comply with the provisions of this Agreement. FAMS shall
maintain its system such that it is available 24/7/365. FAMS may schedule up to 8 hours of
maintenance per month. For planned maintenance events that exceed 8 hours, notice will be sent to
NCRC with one weeks advance notice. FAMS and NCRC will provide to each other technical support
contacts defined as personnel available 24/7 to correct any site availability issues.

(a) Business Continuity.

1. FAMS shall maintain and adequately support a business continuity program that ensures the
operational levels set forth and, in the event of an interruption, the recovery of all
functions necessary to meet FAMS’s obligations under this Agreement, in accordance with the
business continuity standards. Such business continuity program must be in place on the
Effective Date.

2. FAMS shall provide a summary of such business continuity program to NCRC within two (2)
business days of the Effective Date and upon request. NCRC shall have the right to require
FAMS, at least once every six (6) months during the Term, to meet with NCRC to review, or to
assess in writing, the continuing adequacy of the business continuity plan and FAMS’s
compliance with the terms of this agreement.

(b) Incident Response and Reporting.

1. No later than 24 business hours after detection, FAMS will notify NCRC of any actual or
potential security intrusion or violation that will or could affect NCRC Confidential
Information, including without limitation, customer data and financial data. This
notification includes any complaint or report FAMS receives from a third party (such as
NCRC’s customers), but excludes a detailed description of FAMS’s development, review and
testing procedures. In FAMS’s notification, it will report on the nature of the incident,
estimated impact on NCRC and investigative action taken or planned. Incidents include,
without limitation, violations or potential violations of a federal or state law, including,
without limitation, the Bank Secrecy Act.

2. FAMS shall provide NCRC with an incident status report every 2 hours or within a timeframe
mutually agreed upon by the parties until both parties agree that a status report is no
longer necessary.

3. Within three (3) business days after the initial incident report, FAMS will provide NCRC
with a written updated report that summarizes the results of the investigative action and
corrective/remedial action taken.

4. Upon completion of the investigation, FAMS will provide NCRC with a final written report
that gives a full accounting of the extent of the security intrusion or security violation,
including, without limitation, a description of NCRC Confidential Information disclosed,
destroyed, compromised, or altered; specific corrective/remedial action taken.

5. NCRC reserves the right to disconnect the FAMS service if unauthorized access is
discovered. FAMS reserves reciprocal rights. This does not however, relieve FAMS of its
commitment to deliver on its service obligations which may be unaffected by this loss in
connection. Such unaffected service requirements will have to be met by alternate methods of
servicing until the inappropriate access can be investigated and resolved to the satisfaction
of NCRC.

1.6 Customer Service. FAMS shall maintain a customer service center staffed with
trained personnel sufficient to handle phone, e-mail and mailed customer inquiries (“FAMS Customer
Services”). Subject to the provisions set forth in Exhibit C, FAMS agrees to maintain such
staffing to meet the service level standards set forth in Exhibit B.

1.7 Manner of Providing FAMS Reports. FAMS will provide FAMS Reports for inclusion in the
Services as follows: NCRC shall transmit Consumer User orders obtained by it for FAMS Reports by
providing FAMS with an electronically readable transmitted file specifying the number of
Repositories to be used in the FAMS Report, the type of FAMS Report and the number of each type,
and the individual Consumer Users’ respective names, addresses (current address is required and
previous address, if available), dates of birth, social security numbers, and other agreed upon
identifying information (together, “Identification Information”).

 

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1.8 Authentication. FAMS shall provide Experian’s L3 (“L3”) authentication process or
other process to authenticate a Consumer User’s identity. If such authentication fails, FAMS shall
attempt to manually authenticate Consumer User’s via telephone. Consumer Users who cannot be
authenticated will not be able to receive FAMS Reports. FAMS will deliver the required FAMS
Reports on Consumer Users who have been authenticated.

1.9 Fulfillment Procedures. As set forth in section 1.8 above, NCRC will get FAMS
Reports that fail online authentication via a post back to a specified NCRC URL. NCRC may send a
FAMS Report directly to the Consumer User by First Class US mail (“exception fulfillment”) where a
Consumer User claims that he or she did not receive such Report, where orders for such report are
not delivered online due to consumer request for delivery via the mail. NCRC will incur the costs
of buying the FAMS Report, printing it, and mailing it to the Consumer User.

1.10 Billing and Volume.  Not later than 15 business days after the end of each calendar
month, FAMS shall provide NCRC a monthly cumulative report detailing billing and volume and will
note core Ids (client provided unique identification numbers for each FAMS Report request) on the
invoices. Additional reporting frequencies may be delivered at NCRC’s request as mutually agreed
upon by FAMS Client Relations team.

1.11 Related Matters. NCRC shall pay to FAMS a per FAMS Report fee as specified in Exhibit
“C,” attached hereto, and incorporated herein by reference, to support the costs of dedicated
inbound toll free telephone lines provided by FAMS for service to Consumer Users for calls related
to FAMS Reports ordered and delivered under this Agreement. NCRC shall disclose to Consumer Users
in such manner and form as agreed upon in writing by the parties that (a) CREDCO is the consumer
reporting agency that is providing the CREDCO Credit Reports to the Consumer Users, (b) under the
Fair Credit Reporting Act, as amended (“FCRA”) and applicable state laws, Consumer Users may have
the right to obtain a copy of their credit files at the Bureaus without charge as defined by the
FCRA or for a nominal charge. To the extent required under applicable law, FAMS will participate in
the reinvestigation process to the extent required by applicable law for Consumer User disputes
regarding information in their FAMS Report, and, where applicable, provide disclosures to Consumer
Users. Periodically, FAMS may, together with one or more Repositories or separately, on seven (7)
days’ prior written notice to NCRC, at its own expense, conduct reasonable on-site audits during
normal business hours of NCRC in order to monitor its compliance with the terms of this Agreement.
FAMS shall take commercially reasonable steps necessary to avoid any material disruption to NCRC’s
business during the audit. Notwithstanding anything in the foregoing to the contrary, the scope of
the audit shall exclude technical and competitive business plans, forecasts, and other business or
technical related information, including trade secrets, belonging to NCRC, as well as any other
information that is not strictly necessary for FAMS to determine NCRC’ compliance with the terms of
this Agreement.

1.12 Representations, Warranties, and Covenants. Each party represents, warrants, and
covenants to the other party that throughout the term of this Agreement, its performance shall
comply with all relevant federal, state, and local laws and regulations applicable to such party,
including, but not limited to, the FCRA and applicable state laws. Without limiting the generality
of the foregoing, each party agrees that during the term of this Agreement, it will use all
“nonpublic personal information” it obtains on Consumer Users in connection with this Agreement
solely to perform its respective duties and obligations under this Agreement, it will not use any
such information contrary to the requirements of the Gramm-Leach-Bliley Act and the regulations of
the Federal Trade Commission there under (together, “G-L-B Act”), and it will otherwise comply with
all applicable requirements under the G-L-B-Act in connection with such information and the
Consumer Users to whom such information relates. NCRC and FAMS agree to comply with the foregoing.

2

TERM and TERMINATION

2.1 Term. The initial term of this Agreement shall be for a two year term commencing on the
Effective Date. Thereafter, this Agreement shall automatically renew for successive one-year terms
unless either party gives the other party written notice of its intent to terminate this Agreement
at least sixty (60) days prior to the expiration of the then current term, in which event, this
Agreement shall terminate at the end of such term. In addition, FAMS can terminate this Agreement,
without penalty, effective upon written notice to NCRC if NCRC does not pay FAMS a *** in FAMS
Charges (defined below) for FAMS Reports (Credit Reports and monitoring). FAMS may also terminate
this Agreement immediately, without penalty, if required to do so by any Repository; FAMS will
provide NCRC as much advance notice as possible.

2.2 Termination for Cause. Either party may terminate this Agreement prior to the end of
the then current term in the event that the other party has materially breached a representation,
warranty, covenant, or other agreement hereunder and has not cured such breach within thirty (30)
days after its receipt of written notification by the other party of the breach and its intent to
terminate. In addition, FAMS may terminate this Agreement effective on seven (7) days prior
written notice to NCRC, in the event NCRC has breached any of its obligations with respect to the
use of FAMS Reports and the protection of the privacy of such information and NCRC has not cured
such breach within such seven (7) day period. Termination of this Agreement for cause shall not
impair any other rights or remedies available to the terminating party with respect to the breach
that gave rise to such termination.

2.3 Effect of Termination. At the termination of this Agreement, FAMS will have no further
obligation to provide any new FAMS Reports.

***CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

 

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3

PAYMENT FOR FAMS REPORTS; COLLECTIONS

3.1 FAMS Charges; Collections. FAMS shall be entitled to receive from NCRC the amounts set
forth in Exhibit “C” (“FAMS Charges”). NCRC’s obligation to pay the FAMS Charges is absolute and
unconditional, and is payable irrespective of the prices paid by Consumer Users for FAMS Reports or
actual collections by NCRC. NCRC shall be solely responsible, for collecting payment for the FAMS
Reports from Consumer Users, and NCRC shall bear the sole risk of nonpayment. NCRC shall
indemnify, defend, and hold harmless FAMS from any losses, costs, expenses (including, without
limitation, reasonable attorney fees, costs of litigation, and costs of enforcing judgment),
liabilities, penalties, claims, and damages (together, “Damages”) incurred by FAMS in connection
with NCRC’s collection activities.

3.2 Payment Terms. NCRC agrees that it will remit the FAMS Charges to FAMS within 30 days
after receipt of the invoice for the FAMS Charges.

3.3 Effect of Price Changes. If, during the term of this Agreement, FAMS’s cost of
providing FAMS Reports increases as a result of increased fees from any or all of the Repositories,
or the imposition of new state/federal requirements that increase FAMS’s cost of selling FAMS
Reports to Consumer Users in such states, FAMS may increase the FAMS Charges set forth in Exhibit
“C”, to cover the Repository(s) price increase plus an amount to maintain FAMS’s existing profit
margin percentage on consumer reports. FAMS shall provide NCRC with as much notice as practicable
under the circumstances of any such price increase, and the price increase will be effective after
thirty (30) days written notice to NCRC. In the event FAMS imposes such increase, NCRC may
terminate this Agreement, without penalty, by written notice to FAMS at any time prior to the
effective date of the increase.

3.4 Sales Tax. The prices set forth in Exhibit C do not include sales, use, or
excise taxes, or any other taxes or fees assessed by any state or local authority in connection
with the sale of FAMS Reports to Consumer Users (collectively, “Sales Taxes”), and Sales Taxes
shall be charged separately. If applicable, NCRC shall disclose to Consumer Users that Sales Taxes
will be charged and the amount thereof. NCRC shall be solely responsible for collecting, as FAMS’s
agent, all Sales Taxes due in connection with sales of FAMS Reports to Consumer Users and
remitting, when due, to the appropriate governmental authorities, all such Sales Taxes. NCRC
agrees to provide FAMS with evidence of all Sales Tax payments to governmental authorities
concurrently with payment, and will permit FAMS to audit its books and records on reasonable notice
to verify that all required Sales Taxes have been properly paid. NCRC shall indemnify, defend, and
hold harmless FAMS for any and all such Sales Taxes and any Damages incurred by FAMS in connection
with NCRC’s failure to properly collect and deliver to the appropriate government authorities on a
timely basis all required Sales Taxes.

4

CONFIDENTIAL AND OTHER PROTECTED INFORMATION

4.1  Each party acknowledges that the other party owns all rights to “Confidential
Information” that may be disclosed from time to time by the owning party (“Disclosing Party”) to
the other party (“Receiving Party”). “Confidential Information” means all trade secrets and other
nonpublic proprietary information that the Disclosing Party has identified to the Receiving Party
as such prior to disclosure or promptly thereafter if such disclosure is oral. The Receiving Party
agrees to use the Disclosing Party’s Confidential Information only to perform its obligations under
this Agreement, and to use the same level of diligence and care that a prudent business would use
to protect its own confidential and proprietary information in order to prevent unauthorized use,
dissemination, or disclosure of the Disclosing Party’s Confidential Information. Each party will
take reasonable steps to assure that its employees and agents comply with the foregoing
requirements. The parties acknowledge that any breach of this Section 4 by one party could
cause irreparable harm to the other party, and each party hereby consents to entry of an injunction
or other equitable relief, without the necessity of posting bond or proving damages, in the event
of any such threatened or actual breach by it in addition to monetary damages and any other
available remedies. Confidential Information of the Disclosing Party does not include any
information that is (a) already known to the Receiving Party prior to its receipt of such
information, (b) is developed independently, or legitimately obtained from a third party, by the
Receiving Party, or (c) is required by law or court order to be disclosed; provided,
however, if the Receiving Party is the party subject to such court order or other legal
obligation, it will provide the Disclosing party with prior notice to enable the Disclosing party
to contest such order or obligation or seek appropriate protective remedies. Except as otherwise
required by law, the parties agree to treat as Confidential Information the terms of this Agreement
(including all exhibits and amendments), provided, however, that FAMS may provide a
copy of this Agreement to any Repository, if so requested. In addition, NCRC recognizes that FAMS
has devoted significant resources to developing the format of the FAMS Reports and agrees that such
format is the proprietary information and a valuable commercial asset of FAMS. Accordingly, NCRC
agrees that, except pursuant to this Agreement, it will not directly or indirectly use, or permit
any third party with a marketing relationship with NCRC to provide consumer reports to NCRC
customers in such format or any format that is intentionally designed to be substantially similar
and is likely to be confused with such format.

 

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4.2 Consumer Data. Except as permitted under this Agreement, each party agrees not to
disclose any “Consumer Data” (defined below) to anyone except its employees and agents with a need
to know in order to enable that party to perform its duties and obligations under this Agreement.
Each party agrees to use diligent efforts, and at least the same degree of care it uses to protect
its own confidential information, to prevent unauthorized use or disclosure of the Consumer Data
and to require all agents to agree in writing to comply with such requirements. Each party will
promptly provide the other party with copies of such agreements upon request. “Consumer Data” is
defined as all information or data, in whatever form, provided by or through either party to the
other in connection with this Agreement concerning or relating to any Consumer User, including,
without limitation, names, addresses, telephone numbers, other identifying information, and
information relating to personal characteristics, preferences, or credit history from the
repositories. In order to comply with the laws that regulate the Consumer Data, each party agrees
to institute the following systems, procedures, and controls (together, “Security Procedures”):

	 	a.	 	Each party will limit the persons who have access to the Consumer Data to
employees and agents who have a need to have access to such information in order to
enable that party to provide the services under this Agreement (“Authorized Persons”).
FAMS may also provide the Consumer Data to Credco and to the Repositories in order to
provide the FAMS Reports under this Agreement;

	 	b.	 	Neither party will make any copies of any Consumer Data except secure backups and
will require all Authorized Persons to agree to the same limitation. FAMS and Credco
may maintain copies of the Consumer Data to meet its obligations under applicable law,
including, but not limited to the Fair Credit Reporting Act, as amended;

	 	c.	 	Each party will institute procedures to protect the confidentiality of the
Consumer Data such as keeping materials in a locked room to which persons other than
Authorized Persons will not have access;

	 	d.	 	Each party shall implement such other security procedures that NCRC and FAMS may
mutually agree are reasonably required from time to time.

	 	e.	 	Each party shall permit FAMS to audit the Security Procedures during normal
business hours upon seven (7) days’ prior notice, subject to the audit limitations
stated in paragraph 1.11, above.

5

DISCLAIMERS AND LIMITATION ON LIABILITIES

5.1  ALL FAMS REPORTS AND ALL OTHER PRODUCTS AND SERVICES PROVIDED BY FAMS (FAMS REPORTS
AND ALL OTHER PRODUCTS AND SERVICES PROVIDED BY FAMS, TOGETHER REFERRED TO AS “FAMS SERVICE(S)”)
UNDER THIS AGREEMENT ARE PROVIDED “AS IS.” NEITHER FAMS NOR ANY OF ITS AFFILIATES (INCLUDING, BUT
NOT LIMITED TO CREDCO) MAKES ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, INCLUDING, BUT NOT
LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT
TO ANY FAMS SERVICE INCLUDING, WITHOUT LIMITATION, WITH RESPECT TO THE ACCURACY, VALIDITY, OR
COMPLETENESS OF ANY FAMS SERVICE (OR ANY INFORMATION CONTAINED THEREIN). NO WARRANTIES WILL BE
CREATED BY COURSE OF DEALING, COURSE OF PERFORMANCE, OR TRADE USAGE, AND FAMS EXPRESSLY DISCLAIMS
ALL SUCH REPRESENTATIONS AND WARRANTIES. IN ADDITION, NEITHER FAMS, NOR ANY OF ITS AFFILIATES
WARRANT THAT THE FAMS SERVICES (OR ANY INFORMATION THEREIN) WILL BE FREE FROM ERRORS, WILL MEET
NCRC’S OR CONSUMER USER’S NEEDS, OR WILL BE PROVIDED ON AN UNINTERRUPTED BASIS SUBJECT TO THE
BOUNDARIES OF THIS AGREEMENT. In no event will FAMS or any of its affiliates have any liability to
NCRC, any Consumer User, or any third party, for incidental, special, consequential, or any other
similar Damages resulting from the invalidity, inaccuracy, or incompleteness of the information
contained in any FAMS Report or any delay in providing such report, even if specifically advised of
the possibility of such Damages. FAMS’s maximum liability in connection with any FAMS Report shall
not exceed the amount of the FAMS Charge received by FAMS with respect to such report. Neither
party shall have any liability to the other party in connection with any delay, interruption, or
failure in performance hereunder resulting from any cause if such cause is beyond the reasonable
control of the failing party including, with respect to FAMS, the unavailability of consumer
information from any Repository for any reason. For the purposes of this Section 5, the term
“FAMS” also includes the Repositories.

6

INDEMNIFICATION

The parties mutually agree to indemnify, defend, and hold harmless, one another, its respective
affiliates, and the respective officers, directors, employees, agents, and suppliers and other
third party contractors of one another from and against any and all actions, lawsuits,
investigations, proceedings, costs, expenses (including, without limitation, attorney fees and
court costs), damage or claim (collectively, “Claims”) in any way connected with (1) any breach of
this Agreement by either parties employees, agents, or independent contractors, and (2) any Claim
by any Consumer User or any other third party, except to the extent directly caused by gross
negligence.

 

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7

SECURITY BREACH

In the event of any actual or suspected security breach that NCRC either suffers or learns of that
either compromises or is likely to compromise FAMS data (including, but not limited to FAMS
Reports, or any information contained therein) (e.g., physical trespass on a secure facility,
computing systems intrusion/hacking, loss/theft of a PC (laptop or desktop), loss-theft of printed
materials, etc.) (collectively, a “Security Breach”), NCRC will promptly notify FAMS security
personnel within one (1) business day of the discovery of such Security Breach and will immediately
coordinate with FAMS security personnel to investigate and remedy the Security Breach, as directed
by FAMS security personnel. Notification to FAMS shall be made by calling FAMS at 1-619-938-7242.
Except as may be permitted by applicable law, NCRC agrees that it will not inform any third party
of any such Security Breach without FAM’s prior written consent; however, if such disclosure is
required by applicable law, NCRC agrees to work with FAMS regarding the content of such disclosure
so as to minimize any potential adverse impact upon FAMS and its clients and customers. NCRC also
agrees to comply with all applicable federal and state breach laws and to provide timely
notification under applicable law to those individuals affected by the Security Breach (including,
but not limited to, notification to law enforcement authorities in the jurisdiction of NCRC and/or
individual(s) effected) in the event the Security Breach was caused by or arose from the actions or
inactions of NCRC. In addition, NCRC agrees to offer and provide, if accepted, to each affected or
potentially affected consumer, credit history monitoring services for a minimum of one (1) year in
which the consumer’s credit history is monitored and the consumer receives daily notification of
changes that may indicate fraud or identity theft. The monitoring service must include the daily
data from at least one (1) national consumer credit reporting bureau. If the root cause of the
Security Breach is determined by FAMS to be under the control of NCRC (e.g., employee fraud,
misconduct or abuse, poor information security practices, etc.), FAMS may assess NCRC a reasonable
expense recovery fee. If the root cause of the Security Breach is determined by FAMS to be under
the control of NCRC (see above), NCRC is required to submit written documentation to FAMS outlining
the cause of the breach and suggested remedial actions. If a Security Breach occurs or is suspected
to have occurred, FAMS may take any action it considers appropriate to safeguard FAMS’s data,
including but not limited to suspension of NCRC’s access until FAMS has determined NCRC’s
environment is secure. FAMS will use commercially reasonable efforts to implement, maintain and
staff an intrusion detection system to minimize exposure to hacking incidents and allow for rapid
correction. FAMS agrees to follow industry-standard security practices at its end of the
connection, including, but not limited to, a firewall, in an effort to not allow unauthorized
traffic to pass into NCRC networks through any common Internet connection. FAMS will subscribe to
third-party, industry-recognized security-vulnerability and security-notification services such as
vendors, CERT, and the Cybertrust Certification alert service. FAMS will review associated
notifications and alerts daily and immediately notify NCRC of any intrusion breach. FAMS will
review, test, schedule, apply and validate security patches within thirty (30) days of issue.

8

GENERAL

Except as expressly set forth herein, the relationship of the parties under this Agreement shall
be, at all times, one of independent contractors, and neither party shall have authority to assume
or create obligations on the other’s behalf or take any action that has the effect of creating the
appearance of its having such authority without the other party’s express prior written consent.
This Agreement constitutes the entire agreement between the parties pertaining to the subject
matter hereof and supersedes all prior or contemporaneous oral or written communications,
proposals, commitments, representations, and agreements of the parties with respect to such subject
matter. No supplement, modification, or amendment of this Agreement shall be binding upon either
party unless executed in writing by both parties hereto. No waiver of any provision of this
Agreement shall be deemed or shall constitute a waiver of any other provisions, whether or not
similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless
executed in writing by the party making the waiver. As to FAMS, only a Senior Vice President or
the Compliance Officer may sign a writing supplementing, modifying, or amending this Agreement, or
waiving any right of FAMS hereunder. As to NCRC, only an Officer may sign a writing supplementing,
modifying, or amending this Agreement, or waiving any right of NCRC hereunder. The recitals,
exhibits and addendums specifically referred to, and attached to this Agreement are part of this
Agreement for all purposes. Except as otherwise expressly provided in this Agreement, all notices,
requests, demands, and other communications in connection with this Agreement shall be in writing
and shall be delivered personally or sent by Federal Express (priority overnight) or a similar
courier service, or sent by first class mail, registered or certified, postage prepaid with return
receipt requested, properly addressed to the other party at the address set forth in the first
paragraph of this Agreement, or to such other address as shall be furnished in writing by either
party in the manner for giving notices hereunder. Any notice provided in accordance with the
requirements of this Agreement shall be deemed to have been given (a) upon personal delivery, or
(b) the earlier of: (i) two business days after it has been sent to the other party as provided
above, or (ii) actual receipt. This Agreement may not be assigned, in whole or in part, by either
of the parties without the prior written consent of the other party unless assignment is voluntary,
by merger or operation of law. In the event of any litigation between the parties to interpret or
enforce the terms of this Agreement, the prevailing party shall be entitled to recover its
reasonable attorney’s fees, costs and expenses.

 

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Assignment. This Agreement may not be assigned, in whole or in part, by either party
without the prior written consent of the other party (which consent may not be unreasonably
withheld or delayed).

This Agreement binds and inures to the benefit of each party’s permitted successors and assigns.
This Agreement is governed by and construed in accordance with the internal laws of the state of
California. If any provision of this Agreement is declared invalid by a court of competent
jurisdiction, the other provisions remain in full force and effect, and this Agreement is deemed to
be amended to replace, to the extent legally possible, the rights and obligations contained in the
invalid provision. The invalidity of any provision is not a failure of consideration. No
representation or promise, or modification or amendment to this Agreement is binding on either
party unless in writing signed by authorized representatives of both parties. The provisions of
Sections 4, 5, 6, 7 and 8 of this Agreement (and any other provisions hereof which by their nature
should survive) shall survive the expiration or termination of this Agreement.

IN WITNESS WHEREOF, the parties have caused their duly authorized officers to execute this
Agreement effective as of the date first above written.

	 	 	 	 	 	 	 	 	 	 	 	 	 
	FIRST ADVANTAGE MEMBERSHIP SERVICES, INC.	 	NationalCreditReport.com, L.L.C.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By: 	/s/ Jason Olerich	 	By: 	/s/ William
J. Caragol	 
	 	 	 	 	 	 	 
	 	Printed:	 	Jason Olerich	 	 	Printed:	 	William
J. Caragol	 	 
	 	Its:	 	 	Director	 	 	Its:	 		CEO	 	 

 

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EXHIBIT A-1

Internet Security Requirements

	A.	 	NCRC will be permitted to allow Consumer Users to access FAMS Reports at a secure
location (“Secure Site”) located on NCRC’s web site, known as www.NCRC (“NCRC Website”),
that is accessible only by the particular Consumer User who ordered the information.

	B.	 	NCRC represents and warrants to FAMS that (a) a Consumer User will be able to access
FAMS Reports through the Internet only at the Secure Site, and (b) each time NCRC provides
a Consumer User access to FAMS Reports at the Secure Site, NCRC will have in effect a
written agreement with the Consumer User that authorizes NCRC, on behalf of the Consumer
User, to place the Consumer User’s order for the FAMS Report with FAMS. NCRC certifies to
FAMS that each time it places such orders with FAMS for FAMS Reports; NCRC will do so
solely on behalf of the authenticated Consumer User that ordered such information pursuant
to the Consumer User’s written instructions.

	C.	 	In order to enter the Secure Site, a Consumer User must use a unique user logon
identification code and password (“Logon Code” and “Password,” respectively).

	D.	 	NCRC agrees that prior to transmitting any FAMS Reports or non-public consumer
information (“Consumer Information”) (FAMS Reports and Consumer Information being referred
to cumulatively as “Subject Information”) through the Internet, or permitting any Consumer
User to access such information at the Secure Site, NCRC will maintain in effect each of
the following security procedures to prevent unauthorized use or dissemination of Subject
Information:

	 	1.	 	All transmissions of Subject Information through the Internet will be
encrypted. 128-bit SSL/TLS or higher strength encryption is required.

	 	2.	 	Subject Information must also be protected when stored on servers,
subject to at least the following requirements:

	 	(A)	 	Servers storing Subject Information must be separated by
firewall or other comparable method from publicly accessible web-servers;

	 	(B)	 	Subject Information must not be stored on a server that
can be accessed by TCP services directly from the Internet and should not be
referenced in public domain name services (DNS) tables;

	 	(C)	 	All security access to these servers, both physical and
network, must include authentication and, in the case of network security,
passwords that are changed at least every 90 days; and

	 	(D)	 	All servers must be kept current with all operating
system patches, within 90 calendar days at they become available.

	 	3.	 	When displaying Subject Information, no Subject Information can be stored
permanently on the presentation server(s). NCRC shall use the presentation
server(s) only to receive the HTTP services. All HTML shall be dynamically created
or interpreted by the application server. The presentation server(s) shall only
receive the data and process it back and forth to the application server. Data
transmitted between NCRC’s browser and the application server must not be cached, in
any form, on the presentation server(s).

	 	4.	 	Subject Information may not be shared with, or accessed by any person
other than an Authorized Employee (as defined below). All transmission of Subject
Information is subject to all the terms and conditions contained in these Internet
Security Requirements. Only Authorized Employees shall have computer network or
terminal or any other access to any Subject Information. Authorized Employees are
employees of NCRC who have a need to access Subject Information in order to carry
out their official duties with NCRC for the purposes specified in this Agreement.
Prior to providing an Authorized Employee with access to any Subject Information,
NCRC will provide the Authorized Employee with adequate training regarding these
Internet Security Requirements and the Fair Credit Reporting Act (“FCRA”) and other
applicable laws, and will require the Authorized Employee to agree to comply with
all such requirements and laws (together, “Employee Requirements”). Without
limiting the generality of the foregoing, NCRC will inform all Authorized Employees
that unauthorized access to information in Credit Reports may subject them to civil
and criminal liability under the FCRA and other applicable laws, punishable by
fines, imprisonment, or both. NCRC will not add any employee as an Authorized
Employee unless the employee has received the required training and has agreed to
comply with the Employee Requirements.

 

-8-

 

	 	5.	 	NCRC shall implement adequate security measures in order to prevent use
or access of Subjection Information by persons other than Authorized Employees,
including, without limitation, the following: (a) assigning each Authorized Employee
a unique Internet identification and password (together, “Operator Passwords”), (b)
changing the Operator Passwords at least once every ninety (90) days or sooner if a
specific Authorized Employee is no longer responsible for accessing Subject
Information or NCRC has learned or suspects that there has been unauthorized access
to an Operator Password, (c) limiting knowledge of the Subject Information and
Operator Passwords to Authorized Employees and strictly prohibiting the sharing,
disclosure or public display of any such information, (d) using all security
features in the software and hardware used to access Subject Information, (e) not
transferring any hardware or software between locations without deletion of all
Subject Information and Operator Passwords, and (f) if unauthorized access to
Subject Information is discovered or suspected, immediately notifying FAMS and
further undertaking all remedial efforts within its power and control to cure such
unauthorized access or use.

	 	6.	 	NCRC will obtain and maintain in effect throughout the term of this
Agreement, a third party network security certification and review in form and
substance reasonably satisfactory to FAMS. The third party utilized by NCRC must be
one of the following: (1) Cybertrust, (2) Foundstone, Inc., (3) ePlus (4)
International Network Service, or (5) Secure Works, Inc. The certification and
review will include the following:

	 	(A)	 	A scan of all external IP addresses to determine if
vulnerabilities exist in the NCRC’s infrastructure;

	 	(B)	 	Intrusion testing on at least a calendar quarter basis;

	 	(C)	 	Review of security policies and procedures and incident
management.

	 	7.	 	NCRC’s Internet connection must be protected with dedicated,
industry-recognized firewalls that are configured and managed to adhere to industry
best practices.

	 	8.	 	Subject Information may only be held on a secure server which can only be
accessed by a secure presentation server, through one of the following:

	 	(A)	 	Dual or multiple firewall method (preferred) — This
methods consists of a firewall between the Internet and the presentation
server(s) and another firewall between the presentation server(s) and the
application server holding the Subject Information. The network firewall
should ensure that only the presentation server is allowed to access the
application server holding Subject Information.

	 	(B)	 	Single firewall method (acceptable) — When a dual
firewall method is not feasible, a single firewall will provide acceptable
levels of protection. The firewall should be installed between the Internet
and the presentation server. Multiple interfaces to separate the
presentation server and the application server holding Subject Information
are required. The firewall should be configured to allow only the
presentation server access to the application server holding Subject
Information.

	 	9.	 	All administrative access to the firewalls and servers should be through
a secure internal network. No direct modem access should be available to the
firewalls or servers.

	 	10.	 	No internal Internet Protocol (IP) addresses should be publicly available
or natively routed to the Internet.

	 	11.	 	The internal network should not provide any external access to any
firewall or servers without proper strong authentication or through firewalls.

	 	12.	 	Any exceptions or alerts must be logged and reviewed by NCRC and
maintained for at least one (1) year for review by FAMS.

	 	13.	 	If approved in writing by FAMS, NCRC may utilize an alternative method of
Consumer User verification, in the form of issuance by NCRC, and use by the Consumer
User, of a User ID and password. FAMS requires that NCRC securely protect each
Consumer User’s User ID and password. Password security procedures must offer
appropriate protections against random access and provide for regular password
changes. Normally, the initial password must be issued by NCRC and not created by
the Consumer User.

 

-9-

 

	E.	 	NCRC agrees that it will not archive, store, or use any FAMS Reports received from FAMS
(whether on any server or any other component of NCRC’s network, NCRC’s Website, any Secure
Site, or otherwise), and it will purge all such information as soon as no longer needed by
the Consumer User who ordered it, but in no event will NCRC store any FAMS Reports for more
than five (5) days without FAMS written approval. In no event will NCRC resell such
information or distribute, disseminate, transfer, or provide other access to such
information to any person unless agreed to by FAMS under terms and conditions agreed to by
NCRC and FAMS, except that NCRC shall provide access to such information to the Consumer
User who ordered it as provided in this Agreement. NCRC shall be responsible, in event of
NCRC error, for any migration or leakage of Subject Information, or any other transfer of
such information, to any location that can be accessed by any person other than the
Consumer User that ordered it.

	F.	 	FAMS may, from time to time, change any of the requirements herein (including by
imposing new requirements or procedures or modifying existing ones) by giving NCRC written
notice of the change. NCRC will conform its systems, applications, process, and procedures
to comply with, or seek mutual clarification of, the change not later than the effective
date specified by FAMS in the notice, or if none is specified, thirty (30) days after
receipt of the notice.

	G.	 	Compliance by NCRC with the above listed requirements shall not relieve NCRC from the
obligation to observe any other or further contractual, legal or regulatory requirements,
nor shall FAMS’s review or approval of any of NCRC’s systems, applications, processes, or
procedures constitute or be deemed to constitute the assumption by FAMS of any
responsibility or liability for compliance by NCRC with any of the same. NCRC shall remain
solely responsible for the security of its systems and the security of all Subject
Information received by it from FAMS and for any breach of that security. FAMS retains the
right, in its sole discretion, to withhold approval of Internet access of FAMS Reports for
any reason. FAMS may suspend or terminate access to the Subject Information at any time if
FAMS has reason to believe that NCRC has violated any of these Internet Security
Requirements or any contractual, legal, or regulatory requirements, rules or terms. NCRC
will be provided a detailed explanation pertaining to the termination and will be allowed
the ability to cure such non-compliance within seven (7) days from official notice.

EXHIBIT A-2

ACCEPTANCE OF TERMS

The following terms and conditions (“Terms and Conditions” or “Agreement”) apply to all Credit
Reports defined below) provided by First Advantage Membership Services, Inc. (“FAMS”) and First
Advantage Credco, LLC (“Credco”) transacted at or through NCRC (the “Website”). Your order of, use
of, and access to, your consumer report (“Basic Report”), credit scores (“Scores”) and other
enhancements to the Basic Report through the Website are subject to all terms and conditions
contained herein and all applicable laws and regulations. For purposes of these Terms and
Conditions, the term “Credit Reports” includes Basic Reports, Scores and other enhancements to
Basic Reports, individually or collectively, as the context requires. PLEASE READ THESE TERMS AND
CONDITIONS CAREFULLY. YOUR ORDER OF, ACCEPTANCE OF, USE OF, AND/OR ACCESS TO CREDIT REPORTS
CONSTITUTES YOUR AGREEMENT TO ABIDE BY EACH OF THE TERMS AND CONDITIONS SET FORTH HEREIN. IF YOU
DO NOT AGREE WITH ANY OF THESE TERMS OR CONDITIONS, DO NOT ORDER, USE OR ACCESS ANY CREDIT REPORT
AND CALL CUSTOMER SERVICE TO CANCEL YOUR MEMBERSHIP.

This Agreement may be updated from time to time. Online customers should check the Website
regularly for updates to these Terms and Conditions. Each time you order, access or use the Credit
Reports, you signify your acceptance and agreement, without limitation or qualification, to be
bound by the then current Agreement.

 

-10-

 

In consideration of your of, access to, and/or use of Credit Reports provided by FAMS/Credco, you
agree to provide true, accurate and complete current information about yourself when prompted to do
so by the registration or application forms or requested to do so by FAMS/Credco.

By submitting your order through the Website, you acknowledge receipt of FAMS/Credco’s Privacy
Policy and agree to its terms.

See below for a copy of FAMS/Credco’s Privacy Policy.

By requesting your Credit Report from NCRC, you certify that you are eighteen (18) years of age or
older. If any information you provide is untrue, inaccurate or not current, FAMS or Credco, at
their sole discretion, has the right to suspend or terminate your order of, use of, and/or access
to Credit Reports provided by FAMS or Credco, and refuse all current or future orders of, use of,
and/or access to Credit Reports provided by FAMS or Credco, or suspend or terminate any portion
thereof. Further, you agree that neither FAMS nor Credco will be liable to you or any third party
if FAMS or Credco suspends or terminates your order of, use of, or access to any Credit Report
provided by FAMS or Credco, or any portion thereof, for any reason.

Credco/FAMS obtains credit information used to prepare Credit Reports from the three national
credit repositories (Equifax, Experian, Trans Union). The Credit Reports Credco/FAMS provides are
intended to furnish you with information that you may not otherwise have readily available to you,
but should not be relied upon for important personal and financial decisions. You should consult
your own professional adviser for specific advice tailored to your personal situation. You agree
that Credco/FAMS have no liability for information (accurate or inaccurate) in your Credit Report.

You understand and agree that by submitting your order you are providing “written instructions” in
accordance with the Fair Credit Reporting Act, as amended (“FCRA”), for Credco/FAMS to obtain
information from your personal credit profile from any consumer reporting agency. You also
authorize Credco/FAMS to access your personal credit profile to verify your identity and to provide
Credit Reports.

ARBITRATION

YOU UNDERSTAND AND AGREE THAT ALL CLAIMS, DISPUTES OR CONTROVERSIES BETWEEN YOU AND FAMS/CREDCO AND
THEIR PARENTS, AFFILIATES, SUBSIDIARIES OR RELATED COMPANIES, INCLUDING BUT NOT LIMTED TO TORT AND
CONTRACT CLAIMS, CLAIMS BASED UPON ANY FEDERAL, STATE OR LOCAL STATUTE, LAW, ORDER, ORDINANCE OR
REGULATION, AND THE ISSUE OF ARBITRABILITY, SHALL BE RESOLVED BY FINAL AND BINDING ARBITRATION AT A
LOCATION DETERMINED BY THE ARBITRATOR. ANY CONTROVERY CONCERNING WHETHER A DISPUTE IS ARBITRABLE
SHALL BE DETERMINED BY THE ARBITRATOR AND NOT BY THE COURT. JUDGMENT UPON ANY AWARD RENDERED BY
THE ARBITRATOR MAY BE ENTERED BY ANY STATE OR FEDERAL COURT HAVING JURISDICTION THEREOF. THIS
ARBITRATION CONTRACT IS MADE PURSUANT TO A TRANSACTION IN INTERSTATE COMMERCE AND ITS
INTERPRETATION, APPLICATION, ENFORCEMENT AND PROCEEDINGS HEREUNDER SHALL BE GOVERNED Y THE FEDERAL
ARBITRATION ACT (“FAA”). NEITHER YOU NOR FAMS/CREDCO SHALL BE ENTITLED TO JOIN OR CONSOLIDATE
CLAIMS IN ARBITRATION BY OR AGAINST OTHER CONSUMERS OR ARBITRATE ANY CLAIM AS A REPRESENTATIVE OR
MEMBER OF A CLASS OR IN A PRIVATE ATTORNEY GENERAL CAPACITY. THE PARTIES VOLUNTARILY AND KNOWINGLY
WAIVE ANY RIGHT THEY HAVE TO A JURY TRIAL.

YOU UNDERSTAND THAT IT MAY BE A VIOLATION OF FEDERAL AND/OR STATE LAW FOR YOU TO OBTAIN A CREDIT
REPORT ON ANY PERSON OTHER THAN YOURSELF, AND THAT UNDER THE FCRA, ANY PERSON WHO KNOWINGLY AND
WILLFULLY OBTAINS INFORMATION ON A CONSUMER FROM A CONSUMER REPORTING AGENCY UNDER FALSE PRETENSES
SHALL BE FINED UNDER TITLE 18, UNITED STATES CODE, IMPRISONED FOR NOT MORE THAN 2 YEARS, OR BOTH.

The FCRA allows you to obtain copy of all of the information in your consumer credit file
disclosure from consumer reporting agencies for a reasonable charge. Full disclosure of
information in your file at the three national credit repositories must be obtained directly from
the repositories by calling:

	 	 	 
	Experian:
	 	1-800-EXPERIAN (1-888-397-3742)
	Equifax:
	 	1-800-685-1111
	Trans Union:
	 	1-800-916-8800

 

-11-

 

The FCRA also states that individuals are entitled to receive a disclosure directly from the
consumer reporting agency free of charge under the following circumstances:

	 	•	 	You certify in writing that you are unemployed and intend to apply for employment
in the next 60 days;

	 	•	 	You are a recipient of public welfare assistance;

	 	•	 	You have reason to believe that your file at the consumer reporting agency
contains inaccurate information due to fraud;

	 	•	 	You have been denied credit, insurance, or employment within the past 60 days as
a result of your Credit Report;

The FCRA also permits consumers to dispute inaccurate information in their Credit Report without
charge. Accurate information cannot be changed. You do not have to purchase your Credit Report
from NCRC to dispute inaccurate or incomplete information in your credit file maintained by
Experian, Equifax or Trans Union (the “Repositories”).

The FCRA allows consumers to get one free comprehensive disclosure of all of the information in
their credit file from each of the Repositories once every 12 months through a central source.
Georgia residents can receive two disclosures per year. Although comprehensive, the credit reports
from each of the Repositories that are available from FAMS/Credco may not have the same information
as a credit report obtained directly from the Repositories or through the central source. To
request your free annual report under the FCRA, you must go to
www.annualcreditreport.com, or call
877-322-8228. FAMS/Credco Credit Reports are not related to the free FCRA disclosure that you are
or may be entitled to.

The Credit Report you are requesting from Credco/FAMS through NCRC is not intended to constitute
the disclosure of Experian, Equifax or Trans Union information required by the FCRA or similar
state laws.

Consumers residing in the states of Colorado, Maine, Maryland, Massachusetts, New Jersey, and
Vermont may receive an additional free copy of their credit report once per year and residents of
the state of Georgia may receive two (2) additional copies per year. For Illinois residents,
credit reporting agencies are required by law to give you a copy of your credit record upon request
at no charge or for a nominal fee.

See below for a full text of your summary of rights.

MODIFICATION OF SERVICES

Credco/FAMS may, at their discretion, modify, or discontinue providing, the Credit Reports, with or
without notice. You agree that Credco/FAMS will not be liable to you or any third party for any
modification or discontinuance of, the Credit Reports.

DISCLAIMERS AND LIMITATIONS OF LIABILITY

YOU EXPRESSLY UNDERSTAND AND AGREE THAT YOUR USE OF THE WEB SITE, THE CREDIT REPORTS, AND CONTENT
IS AT YOUR SOLE RISK. ALL CREDIT REPORTS (AND THE INFORMATION CONTAINED THEREIN) ARE PROVIDED ON
AN “AS IS” OR “AS AVAILABLE” BASIS. CREDCO, FAMS AND THEIR SUPPLIERS EXPRESSLY DISCLAIM ALL
WARRANTIES, GUARANTEES, REPRESENTATIONS AND CONDITIONS OF ANY KIND WHETHER EXPRESS OR IMPLIED,
INCLUDING BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, TITLE OR NONINFRINGEMENT. THE INFORMATION CONTAINED IN THIS WEB SITE, OR THE CREDIT
REPORTS DOES NOT CONSTITUTE LEGAL, TAX, ACCOUNTING OR OTHER PROFESSIONAL ADVICE. CREDCO, FAMS AND
THEIR RESPECTIVE SUPPLIERS MAKE NO WARRANTY OR REPRESENTATION THAT (I) THE CREDIT REPORTS (AND THE
INFORMATION CONTAINED THEREIN) ARE ACCURATE, COMPLETE OR VALID, (II) THE CREDIT REPORTS WILL BE
DELIVERED IN A TIMELY FASHION, (III) THE CREDIT REPORTS WILL BE DELIVERED ON AN UNINTERRUPTED BASIS
OR BE ERROR-FREE; AND (IV) THE RESULTS THAT MAY BE OBTAINED FROM THE USE OF THE CREDIT REPORTS WILL
BE RELIABLE.

YOU UNDERSTAND AND AGREE THAT CREDCO, FAMS AND THEIR SUPPLIERS WILL NOT BE LIABLE FOR ANY DIRECT,
INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL OR EXEMPLARY DAMAGES RESULTING FROM OR IN ANY WAY
CONNECTED TO YOUR ACCESS TO, USE, OR INABILITY TO USE THE WEBSITE, OR THE CREDIT REPORTS, EVEN IF
CREDCO, FAMS OR THEIR SUPPLIERS HAVE BEEN ADVISED OF THE POSSIBILITY OF THOSE DAMAGES. SOME
JURISDICTIONS EITHER DO NOT ALLOW OR PLACE RESTRICTIONS UPON THE EXCLUSION OR LIMITATION OF DAMAGES
IN CERTAIN TYPES OF AGREEMENTS; FOR THESE JURISDICTIONS, THE AFOREMENTIONED LIMITATION ON LIABILITY
SHALL BE TO THE MAXIMUM DEGREE PERMITTED BY APPLICABLE LAW. IF, NOTWITHSTANDING THE ABOVE,
LIABILITY IS IMPOSED UPON CREDCO OR FAMS, THEN YOU AGREE THAT CREDCO’S AND FAMS’S TOTAL LIABILITY
TO YOU FOR ANY OR ALL OF YOUR LOSSES OR INJURIES FROM FAMS’S OR CREDCO’S ACTS OR OMISSIONS,
REGARDLESS OF THE NATURE OF THE LEGAL OR EQUITABLE CLAIM, SHALL NOT EXCEED THE AMOUNT PAID BY YOU
FOR THE CREDIT REPORT TO WHICH YOUR CLAIM RELATES.

 

-12-

 

NOT A CREDIT REPAIR ORGANIZATION OR CONTRACT

FAMS/Credco offers access to your Credit Report and other credit information. Neither FAMS nor
Credco are credit repair organizations, and are not offering to sell, provide or perform any
service to you for the express or implied purpose of either improving your credit record, credit
history or credit rating or providing advice or assistance to you with regard to improving your
credit record, credit history or credit rating. You acknowledge and agree that you are not seeking
to purchase, use or access any of the Credit Reports, the Website or content in order to do so.

Accurate adverse information in your Credit Report cannot be changed. If you believe that your
Credit Report contains inaccurate, non-fraudulent information, it is your responsibility to contact
the relevant Repository, and follow the appropriate procedures for notifying the Repository that
you believe that your Credit Report contains an inaccuracy. Any information provided to you
regarding the procedures followed by the various Repositories related to the removal of inaccurate,
non-fraudulent information is provided without charge to you and is available for free.

These terms and conditions, the Privacy Policy, and other policies Credco/FAMS may post to this
Website, constitute the entire agreement between Credco/FAMS and you in connection with your use of
the Credit Reports, and supersede any prior versions of the terms and conditions, if applicable.
Credco/FAMS may update these terms and conditions from time to time by posting revised terms and
conditions on this Web Site, without notice to you, and your subsequent use of the Web Site is
governed by those new terms and conditions. The terms and conditions are effective until
terminated by Credco and/or FAMS. In the event of termination, the Disclaimers and Limitations of
Liability provisions set forth in these Terms and Conditions will survive. In the event of a
conflict between any other notice, policy, disclaimer or other term contained in this Website,
these Terms and Conditions will control. If any provision is deemed to be unlawful or
unenforceable, it will not affect the validity and enforceability of the remaining provisions. The
section headings are for convenience only and do not have any force or effect.

Privacy Policy Notice

Credco’s/FAMS’s policy on how your personal information is used and disclosed is contained in
Credco’s/FAM’s Privacy Policy. The Credit Reports provided under these Terms and Conditions are
web-based and you agree to accept this notification, revisions, and the provision of an annual
notice electronically through this Website.

LEGAL NOTICE

1) NEITHER NCRC (“NCRC”), ITS EMPLOYEES, AGENTS, SUCCESSORS, AND/OR ASSIGNS, MAKE ANY WARRANTIES,
EXPRESS OR IMPLIED, INCLUDING THE WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE, OR ASSUME ANY LEGAL LIABILITY OR RESPONSIBILITY FOR THE ACCURACY, COMPLETENESS, OR
USEFULNESS OF ANY INFORMATION CONTAINED AT THIS WEB SITE OR REPRESENT THAT USE OF THIS INFORMATION
WOULD NOT INFRINGE OTHER THIRD PARTY RIGHTS. FURTHER NCRC SHALL NOT BE LIABLE FOR ANY DIRECT,
INDIRECT, CONSEQUENTIAL, OR INCONSEQUENTIAL DAMAGES TO THE USER, OR A THIRD PARTY ARISING FROM USE
OF THIS WEB SITE.

2) In providing this information, NCRC does not assume any liability as a result of the use or
misuse of the information. By your use of this information, you recognize and agree to hold NCRC
harmless from any liability as a result of your using this information, materials, products or
services listed at this web site.

3) NCRC reserves the right to change any information at this website without prior notice.

4) NCRC and its vendors and suppliers have taken substantial steps to insure the confidentiality of
information transmitted to them via the Internet. However the user is cautioned that unexpected
changes in technology may be used by unauthorized third parties to intercept your information.
Accordingly NCRC assumes no liability or responsibility should confidential information belonging
to the user be intercepted and subsequently used by an unintended recipient.

5) You understand that the credit report is being provided by FAMS/CREDCO not by NCRC, that NCRC is
not a credit bureau, that
NCRC and its product are solely mechanisms of communication for you to obtain the Credit Report,
and NCRC assumes no responsibility or liability whatsoever for it.

6) Clicking on certain links within this web site might take you to other web sites for which NCRC
assumes no responsibility of any kind for the content or otherwise. The content presented at this
site may vary depending upon your browser.

 

-13-

 

EXHIBIT A-3

FAMS will allow the “Yes” click on NCRC’s website to constitute “written instructions” so long as
certain requirements are followed. Such requirements will be necessary whenever the application
requires reliance on the “written instructions” permissible purpose.

NCRC is responsible for an independent evaluation of whether it will rely on a “Yes” click on the
NCRC website as “written instructions” permissible purpose.

The NCRC website requirements, which must be followed by NCRC, are as follows:

	 	1.	 	A prominently displayed message informing the consumer that his or her credit profile
will be consulted for a stated purpose and no other, and that clicking on the “I AGREE”
button constitutes written instructions under the Fair Credit Reporting Act. Sample
disclosure language is provided below;

	 	2.	 	The “I AGREE” button must immediately follow the notice provided above. Also, the
notice and “I AGREE” button must be separate from any other notice or message contained on
the NCRC website (i.e., not part of any general privacy notice);

	 	3.	 	A second click by the consumer following a statement asking the consumer to confirm his
or her agreement. Sample language for a second, confirming click is provided below;

	 	4.	 	The ability of the consumer to fully review any of the terms to which he or she is
agreeing immediately preceding the consensual click. This means that the notice and
message must be in full text above the “I AGREE” button and cannot be contained in a
separate part of the website with a notification that the consumer may review the terms if
he or she wishes by clicking a separate icon;

	 	5.	 	The consumer must not be able to proceed in the process without affirmatively agreeing
to the terms in the notice, and confirming the agreement with a second click;

	 	6.	 	The consumer must have the ability to print out the terms to which he or she is
agreeing (i.e., the ability to print out the notice and consent provided in 1 above); and

	 	7.	 	NCRC must have the ability to download or otherwise store the fact that the consumer
has provided “written instructions” by clicking “I AGREE”. This cannot be satisfied by the
fact that the consumer is not permitted to go further in the process unless he or she
clicks “I AGREE”. NCRC must have the ability to print out a log or other document that
indicates affirmatively that the consumer consented by clicking “I AGREE”, and preferably
the date and time of the consent.

FAMS requires that the notice provided by NCRC be substantially as follows:

“You understand that by clicking on the “I AGREE” button immediately following this notice, you are
providing “written instructions” to FAMS/Credco under the Fair Credit Reporting Act authorizing
FAMS/Credco to obtain information from your personal credit profile from Experian, Equifax and
Trans Union. You authorize FAMS/Credco to obtain such information solely to {purpose for accessing
credit report (a) for your own use; (b) to confirm your identity to avoid fraudulent transactions
in your name; (c) monitoring your credit file for changes}.” [Use all that apply]

The second click notice should read substantially as follows:

“Please confirm your authorization for FAMS/Credco to obtain your credit profile from Experian,
Equifax and Trans Union to {purpose for pulling the report}.”

 

-14-

 

Exhibit B

Customer User Service Standards

Customer Service Provider 

CREDCO produces the JMA Credit Reports, delivers them to Consumer Users, and provides Customer
Service. CREDCO is responsible for assuring that CREDCO maintains the service standards described
in this Exhibit B, and CREDCO also has the direct responsibilities and obligations set
forth below.

Customer Service Hours

	(a)	 	Customer Service shall be provided during no less than the following hours: Monday through
Friday from 9a.m. to 9:00 p.m. EST. Customer service will not be provided on the following
days: New Year’s Day, Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas.

Customer Service Average Response Time

	(a)	 	“Customer Service Response Time” (“CS Response Time”), with respect to a call placed by a
Consumer to CREDCO customer service facility means the time that elapses between the time the
call is connected and the time the call is answered by a live operator who is fully qualified
to resolve the Consumer User’s Request, including any time the Consumer is placed on hold
after the call is initially answered.

	(b)	 	“Average CS Response Time”, with respect to a day, means the average CS Response Time of all
calls placed by Consumer Users to CREDCO customer service facility during such day.

	(c)	 	The Average CS Response Time shall be 80% of all calls answered within 60 seconds with any
time a Consumer User is placed on hold after the call is initially answered being included in
this time calculation.

	(d)	 	CREDCO shall take the following action if the Average CS Response Time in any given day does
not meet 80% of all calls answered within 60 seconds as provided above: CREDCO shall promptly
deliver to NCRC a written explanation and statement, acceptable to NCRC, of its plans to
ensure that the Average CS Response Time is met and shall make reasonable efforts to achieve
that objective within thirty (30) days after delivering the statement.

Customer Service Abandonment

	(a)	 	Abandoned Customer Service Call (“Abandoned CS Call”) means any call placed by a Consumer
User to CREDCO customer service facility that ends prior to being answered and resolved by a
live operator, either because (i) the caller ended the call because the wait time exceeded 60
seconds, or (ii) the call was terminated through no act of the caller.

	(b)	 	Customer Service Abandonment Rate (“CS Abandonment Rate”), with respect to a day, is the
ratio of (i) all Abandoned CS Calls for each such day to (ii) all calls placed by Consumer
User’s to CREDCO customer service facility on such day.

	(c)	 	The CS Abandonment Rate shall be no more than seven percent (7%).

Additional Reporting Requests

From time to time additional customer service performance reports may be requested by NCRC.
Reporting data types and frequencies of data reporting will be reviewed and mutually agreed upon
prior to inclusion in a monthly reporting schedule.

 

-15-

 

Exhibit “C”

	 	 	 	 	 	 	 	 	 	 	 
	 	 	***	 	***	 	***	 	***	 	***
	 
	1B Experian Report

	 	***
	 	***
	 	***
	 	***
	 	***
	1B TransUnion Report

	 	***
	 	***
	 	***
	 	***
	 	***
	1B Equifax Report non CSC State

	 	***
	 	***
	 	***
	 	***
	 	***
	1B Equifax Report CSC State

	 	***
	 	***
	 	***
	 	***
	 	***
	3B Report non CSC State

	 	***
	 	***
	 	***
	 	***
	 	***
	3B Report CSC State

	 	***
	 	***
	 	***
	 	***
	 	***
	1B Experian Monitoring

	 	***
	 	***
	 	***
	 	***
	 	***
	1B TransUnion Monitoring

	 	***
	 	***
	 	***
	 	***
	 	***
	1B Equifax Monitoring

	 	***
	 	***
	 	***
	 	***
	 	***
	3B Monitoring

	 	***
	 	***
	 	***
	 	***
	 	***
	Online Authentication

	 	***
	 	***
	 	***
	 	***
	 	***
	1B Score

	 	***
	 	***
	 	***
	 	***
	 	***
	3B Score

	 	***
	 	***
	 	***
	 	***
	 	***
	What if Simulator (TransUnion report required)

	 	***
	 	***
	 	***
	 	***
	 	***
	Customer Service

	 	***
	 	***
	 	***
	 	***
	 	***
	Customer Service Training

	 	***
	 	***
	 	***
	 	***
	 	***
	Customer Service Curriculum Development

	 	***
	 	***
	 	***
	 	***
	 	***
	 
	Credit Interface Set-Up Fee

	 	***
	 	N/A
	 	N/A
	 	N/A
	 	N/A
	***Minimum

	 	***
	 	***

	 	 	 
	Product	 	Info/Notes
	 
	1B Report
	 	Experian Report

	3B Report non CSC State
	 	 

	3B Report CSC State
	 	Arkansas, Iowa, Illinois, Indiana, Kansas, Kentucky, Louisiana,
Minnesota, Missouri, North Dakota, Nebraska, Ohio, Oklahoma, Texas,
Wisconsin

	1B Monitoring
	 	Experian Monitoring

	3B Monitoring
	 	Daily Monitoring

	Online Authentication
	 	Experian L3 Product

	1B Score
	 	TU Algorithm score range 150- 930

	3B Score
	 	TU Algorithm score range 150- 930

	What if Simulator
	 	Charged per consumer use (unlimited simulations for 30 days)

	Customer Service
	 	Volume tier is based on per minute of talk time, includes long distance

	Customer Service Training
	 	Per Hour

	Customer Service Curriculum Development
	 	Per Hour

***CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED
PORTION.

 

-16-

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