Document:

Exhibit 10.6

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 BELOW, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.

WARRANT TO PURCHASE STOCK

Company: TimeLine, Inc., a Washington corporation
 Number of Shares: 7,500
 Class of Stock: Common
 Warrant Price: Is a price equal to the average closing price of the five business days prior to the Warrant Effective Date.
 Issue Date: Is the Warrant Effective Date, which is the date in which the Holder executes this Warrant
 Expiration Date: The 7th anniversary after the Issue Date

          THIS WARRANT CERTIFIES THAT, for the agreed upon value of $1.00 and for other good and valuable consideration, SILICON VALLEY BANK (“Holder”) is entitled to purchase the number of fully paid and nonassessable shares of the class of securities (the “Shares”) of the company (the “Company”) at the Warrant Price, all as set forth above and as adjusted pursuant to Article 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth in this Warrant. 

ARTICLE 1. EXERCISE.

                         1.1          Method of Exercise.  Holder may exercise this Warrant by delivering a duly executed Notice of Exercise in substantially the form attached as Appendix 1 to the principal office of the Company.  Unless Holder is exercising the conversion right set forth in Article 1.2, Holder shall also deliver to the Company a check, wire transfer (to an account designated by the Company), or other form of payment acceptable to the Company for the aggregate Warrant Price for the Shares being purchased.

                         1.2          Conversion Right.  In lieu of exercising this Warrant as specified in Article 1.1, Holder may from time to time convert this Warrant, in whole or in part, into a number of Shares determined by dividing (a) the aggregate fair market value of the Shares or other securities otherwise issuable upon exercise of this Warrant minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share.  The fair market value of the Shares shall be determined pursuant to Article 1.3.

                         1.3          Fair Market Value.  If the Company’s common stock is traded in a public market and the Shares are common stock, the fair market value of each Share shall be the closing price of a Share reported for the business day immediately before Holder delivers its Notice of Exercise to the Company (or in the instance where the Warrant is exercised immediately prior to the effectiveness of the Company’s initial public offering, the “price to public” per share price specified in the final prospectus relating to such offering).  If the

Company’s common stock is traded in a public market and the Shares are preferred stock, the fair market value of a Share shall be the closing price of a share of the Company’s common stock reported for the business day immediately before Holder delivers its Notice of Exercise to the Company (or, in the instance where the Warrant is exercised immediately prior to the effectiveness of the Company’s initial public offering, the initial “price to public” per share price specified in the final prospectus relating to such offering), in both cases, multiplied  by the number of shares of the Company’s common stock into which a Share is convertible.  If the Company’s common stock is not traded in a public market, the Board of Directors of the Company shall determine fair market value in its reasonable good faith judgment.

                         1.4          Delivery of Certificate and New Warrant.  Promptly after Holder exercises or converts this Warrant and, if applicable, the Company receives payment of the aggregate Warrant Price, the Company shall deliver to Holder certificates for the Shares acquired and, if this Warrant has not been fully exercised or converted and has not expired, a new Warrant representing the Shares not so acquired.

                         1.5          Replacement of Warrants.  On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation on surrender and cancellation of this Warrant, the Company shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor.

                         1.6          Treatment of Warrant Upon Acquisition of Company.

                                        1.6.1     “Acquisition”.  For the purpose of this Warrant, “Acquisition” means any sale, license, or other disposition of all or substantially all of the assets of the Company, or any reorganization, consolidation, or merger of the Company where the holders of the Company’s securities before the transaction beneficially own less than 50% of the outstanding voting securities of the surviving entity after the transaction.

                                        1.6.2     Treatment of Warrant at Acquisition. 

A)          Upon the written request of the Company, Holder agrees that, in the event of an Acquisition that is not an asset sale and in which the sole consideration is cash, either (a) Holder shall exercise its conversion or purchase right under this Warrant and such exercise will be deemed effective immediately prior to the consummation of such Acquisition or (b) if Holder elects not to exercise the Warrant, this Warrant will expire upon the consummation of such Acquisition.  The Company shall provide the Holder with written notice of its request relating to the foregoing (together with such reasonable information as the Holder may request in connection with such contemplated Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) days prior to the closing of the proposed Acquisition.

B)          Upon the written request of the Company, Holder agrees that, in the event of an Acquisition that is an “arms length” sale of all or substantially all of the Company’s assets (and only its assets) to a third party that is not an Affiliate (as defined below) of the Company (a “True Asset Sale”), either (a) Holder shall exercise its conversion or purchase right under this Warrant and such exercise will be deemed effective immediately prior to the consummation of such Acquisition or (b) if Holder elects not to exercise the Warrant, this Warrant will continue until the Expiration Date if the Company continues as a going concern following the closing of any such True Asset Sale.  The Company shall provide the Holder with written notice of its request relating to the foregoing (together with such reasonable information as the Holder may request in connection with such contemplated
Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) days prior to the closing of the proposed Acquisition.

C)          Upon the closing of any Acquisition other than those particularly described in subsections (A) and (B) above, the successor entity shall assume the obligations of this Warrant, and this Warrant shall be exercisable for the same securities, cash, and property as would be payable for the Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on the record date for the Acquisition and subsequent closing.  The Warrant Price and/or number of Shares shall be adjusted accordingly.

As used herein “Affiliate” shall mean any person or entity that owns or controls directly or indirectly ten (10) percent or more of the stock of Company, any person or entity that controls or is controlled by or is under common control with such persons or entities, and each of such person’s or entity’s officers, directors, joint venturers or partners, as applicable.

ARTICLE 2. ADJUSTMENTS TO THE SHARES.

                         2.1          Stock Dividends, Splits, Etc.  If the Company declares or pays a dividend on the Shares payable in common stock, or other securities, then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which Holder would have been entitled had Holder owned the Shares of record as of the date the dividend occurred.  If the Company subdivides the Shares by reclassification or otherwise into a greater number of shares or takes any other action which increase the amount of stock into which the Shares are convertible, the number of shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased. 
If the outstanding shares are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately increased and the number of Shares shall be proportionately decreased.

                         2.2          Reclassification, Exchange, Combinations or Substitution.  Upon any reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the Shares if this Warrant had been exercised immediately before such reclassification, exchange, substitution, or other event.  Such an event shall include any automatic conversion of the outstanding or issuable securities of the Company of the same class or series as the Shares to common stock pursuant to the terms of the
Company’s Articles or Certificate (as applicable) of Incorporation upon the closing of a registered public offering of the Company’s common stock.  The Company or its successor shall promptly issue to Holder an amendment to this Warrant setting forth the number and kind of such new securities or other property issuable upon exercise or conversion of this Warrant as a result of such reclassification, exchange, substitution or other event that results in a change of the number and/or class of securities issuable upon exercise or conversion of this Warrant.  The amendment to this Warrant shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Article 2 including, without limitation, adjustments to the Warrant Price and to the number of securities or property issuable upon exercise of the new Warrant.  The provisions of this Article 2.2 shall similarly apply to successive reclassifications, exchanges,
substitutions, or other events. 

                         2.3          Adjustments for Diluting Issuances.  The Warrant Price and the number of Shares issuable upon exercise of this Warrant or, if the Shares are Preferred Stock, the number of shares of common stock issuable upon conversion of the Shares, shall be subject to adjustment, from time to time in the manner set forth on Exhibit A in the event of Diluting Issuances (as defined on Exhibit A).

                         2.4          No Impairment.  The Company shall not, by amendment of its Articles or Certificate (as applicable) of Incorporation or through a reorganization, transfer of assets,

consolidation, merger, dissolution, issue, or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed under this Warrant by the Company, but shall at all times in good faith assist in carrying out of all the provisions of this Article 2 and in taking all such action as may be necessary or appropriate to protect Holder’s rights under this Article against impairment. 

                         2.5          Fractional Shares.  No fractional Shares shall be issuable upon exercise or conversion of this Warrant and the number of Shares to be issued shall be rounded down to the nearest whole Share.  If a fractional share interest arises upon any exercise or conversion of the Warrant, the Company shall eliminate such fractional share interest by paying Holder the amount computed by multiplying the fractional interest by the fair market value of a full Share.

                         2.6          Certificate as to Adjustments.  Upon each adjustment of the Warrant Price, the Company shall promptly notify Holder in writing, and, at the Company’s expense, promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which such adjustment is based.  The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant Price in effect upon the date thereof and the series of adjustments leading to such Warrant Price.

ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

                         3.1          Representations and Warranties.  The Company represents and warrants to the Holder as follows:

                                        (a)          The initial Warrant Price referenced on the first page of this Warrant is not greater than (i) the price per share at which the Shares were last issued in an arms-length transaction in which at least $500,000 of the Shares were sold and (ii) the fair market value of the Shares as of the date of this Warrant.

                                        (b)          All Shares which may be issued upon the exercise of the purchase right represented by this Warrant, and all securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.

                                        (c)          The Capitalization Table previously provided to Holder remains true and complete as of the Issue Date.

                         3.2          Notice of Certain Events.  If the Company proposes at any time (a) to declare any dividend or distribution upon any of its stock, whether in cash, property, stock, or other securities and whether or not a regular cash dividend; (b) to offer for sale any shares of the Company’s capital stock (or other securities convertible into such capital stock), other than (i) pursuant to the Company’s stock option or other compensatory plans, (ii) in connection with commercial credit arrangements or equipment financings, or (iii) in connection with strategic transactions for purposes other than capital raising; (c) to effect any reclassification or recapitalization of any of its stock; (d) to merge or consolidate with or into any other
corporation, or sell, lease, license, or convey all or substantially all of its assets, or to liquidate, dissolve or wind up; or (e) offer holders of registration rights the opportunity to participate in an underwritten public offering of the Company’s securities for cash, then, in connection with each such event, the Company shall give Holder: (1) at least 10 days prior written notice of the date on which a record will be taken for such dividend, distribution, or subscription rights (and specifying the date on which the holders of common stock will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (c) and (d) above; (2) in the case of the matters referred to in (c) and (d) above at least 10 days prior written notice of the date when the same

will take place (and specifying the date on which the holders of common stock will be entitled to exchange their common stock for securities or other property deliverable upon the occurrence of such event); and (3) in the case of the matter referred to in (e) above, the same notice as is given to the holders of such registration rights.

                         3.3          Registration Under Securities Act of 1933, as amended.  The Company agrees that the Shares or, if the Shares are convertible into common stock of the Company, such common stock, shall be subject to the registration rights set forth on Exhibit B.

                         3.4          No Shareholder Rights.  Except as provided in this Warrant, the Holder will not have any rights as a shareholder of the Company until the exercise of this Warrant.

ARTICLE 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER.  The Holder represents and warrants to the Company as follows:

                         4.1          Purchase for Own Account.  This Warrant and the securities to be acquired upon exercise of this Warrant by the Holder will be acquired for investment for the Holder’s account, not as a nominee or agent, and not with a view to the public resale or distribution within the meaning of the Act.  Holder also represents that the Holder has not been formed for the specific purpose of acquiring this Warrant or the Shares.

                         4.2          Disclosure of Information.  The Holder has received or has had full access to all the information it considers necessary or appropriate to make an informed investment decision with respect to the acquisition of this Warrant and its underlying securities.  The Holder further has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of this Warrant and its underlying securities and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify any information furnished to the Holder or to which the Holder has access.

                         4.3          Investment Experience.  The Holder understands that the purchase of this Warrant and its underlying securities involves substantial risk.  The Holder has experience as an investor in securities of companies in the development stage and acknowledges that the Holder can bear the economic risk of such Holder’s investment in this Warrant and its underlying securities and has such knowledge and experience in financial or business matters that the Holder is capable of evaluating the merits and risks of its investment in this Warrant and its underlying securities and/or has a preexisting personal or business relationship with the Company and certain of its officers, directors or controlling persons of a nature and duration that
enables the Holder to be aware of the character, business acumen and financial circumstances of such persons.

                         4.4          Accredited Investor Status.  The Holder is an “accredited investor” within the meaning of Regulation D promulgated under the Act.

                         4.5          The Act.  The Holder understands that this Warrant and the Shares issuable upon exercise or conversion hereof have not been registered under the Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Holder’s investment intent as expressed herein.  The Holder understands that this Warrant and the Shares issued upon any exercise or conversion hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable state securities laws, or unless exemption from such registration and qualification are otherwise available.

ARTICLE 5. MISCELLANEOUS.

                         5.1          Term.  This Warrant is exercisable in whole or in part at any time and from time to time on or before the Expiration Date.

                         5.2          Legends.  This Warrant and the Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in substantially the following form:

	
  
 
  	
  
THIS WARRANT   AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE   SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY   STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 BELOW, MAY NOT   BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND   UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN   THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER   OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS   EXEMPT FROM REGISTRATION.
  	
  
 
  

                         5.3          Compliance with Securities Laws on Transfer.  This Warrant and the Shares issuable upon exercise of this Warrant (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) may not be transferred or assigned in whole or in part without compliance with applicable federal and state securities laws by the transferor and the transferee (including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company, as reasonably requested by the Company).  The Company shall not require Holder to provide an opinion of counsel if the transfer is to Silicon Valley Bancshares (Holder’s parent company) or any other affiliate of Holder. 
Additionally, the Company shall also not require an opinion of counsel if there is no material question as to the availability of current information as referenced in Rule 144(c), Holder represents that it has complied with Rule 144(d) and (e) in reasonable detail, the selling broker represents that it has complied with Rule 144(f), and the Company is provided with a copy of Holder’s notice of proposed sale.

                         5.4          Transfer Procedure.  Upon receipt by Holder of the executed Warrant, Holder will transfer all of this Warrant to Silicon Valley Bancshares, Holder’s parent company, by execution of an Assignment substantially in the form of Appendix 2.  Subject to the provisions of Article 5.3 and upon providing Company with written notice, Silicon Valley Bancshares and any subsequent Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the Shares issuable directly or indirectly, upon conversion of the Shares, if any) to any transferee, provided, however, in connection with any such transfer, Silicon Valley Bancshares or any subsequent Holder will give the Company notice of the portion of
the Warrant being transferred with the name, address and taxpayer identification number of the transferee and Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable).  The Company may refuse to transfer this Warrant or the Shares to any person who directly competes with the Company, unless, in either case, the stock of the Company is publicly traded.

                         5.5          Notices.  All notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and effective when given personally or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company or the Holder, as the case may  (or on the first business day after transmission by facsimile) be, in writing by the Company or such Holder from time to time.  Effective upon receipt of the fully executed Warrant and the initial transfer described in Article

5.4 above, all notices to the Holder shall be addressed as follows until the Company receives notice of a change of address in connection with a transfer or otherwise:

	
  
 
  	
  
Silicon   Valley Bancshares
  
	
  
 
  	
  
Attn:   Treasury Department
  
	
  
 
  	
  
3003 Tasman   Drive, HA 200
  
	
  
 
  	
  
Santa Clara,   CA 95054
  
	
  
 
  	
  
Telephone:   408-654-7400
  
	
  
 
  	
  
Facsimile:   408-496-2405
  

Notice to the Company shall be addressed as follows until the Holder receives notice of a change in address:

	
  
 
  	
  
TimeLine,   Inc.
  
	
   
  	
  
Attn:  President/CEO
  
	
  
 
  	
  
3055 112th   Avenue NE, Suite 106
  
	
  
 
  	
  
Seattle, WA   98004
  
	
  
 
  	
  
Telephone:   425-822-3140
  
	
  
 
  	
  
Facsimile:  425-822-1120
  

                         5.6          Waiver.  This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought.

                         5.7          Attorney’s Fees.  In the event of any dispute between the parties concerning the terms and provisions of this Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorney’s fees.

                         5.8          Automatic Conversion upon Expiration.  In the event that, upon the Expiration Date, the fair market value of one Share (or other security issuable upon the exercise hereof) as determined in accordance with Section 1.3 above is greater than the Exercise Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be converted pursuant to Section 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised or converted, and the Company shall promptly deliver a certificate representing the Shares (or such other securities) issued upon such conversion to the Holder. 

                         5.9          Counterparts.  This Warrant may be executed in counterparts, all of which together shall constitute one and the same agreement.

                         5.10          Governing Law.  This Warrant shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its principles regarding conflicts of law.

“COMPANY”

TIMELINE, INC.

	
       By:

    	
      /s/ CHARLES
        R. OSENBAUGH, PRESIDENT

    	
        

    	
       By:

    	
       /s/ PAULA
        H. MCGEE, SECRETARY

    
	
       

    	
      

    	
        

    	
        

    	
      

    
	
       Name:

    	
      Charles R. Osenbaugh

    	
        

    	
       Name:

    	
       Paula
        H. McGee

    
	
        

    	 (Print)	
        

    	
        

    	
       (Print)

    
	
       Title:

    	
       Chairman
        of the Board, President or Vice President

    	
        

    	
       Title:

    	
       Chief Financial
        Officer, Secretary, Assistant Treasurer or Assistant Secretary

    

“HOLDER”

SILICON VALLEY BANK

	
       By:

    	
       /s/ PAUL
        HEIMSTRA

    	
        

    
	
        

    	
      

    	
        

    
	
       Name:

    	
       Paul Heimstra

    	
        

    
	
        

    	
       (Print)

    	
        

    
	
      Title:

    	
       Vice President

    	
        

    
	
       Warrant Effective Date: September
        23, 2004

    	
        

    

APPENDIX 1

NOTICE OF EXERCISE

          1.          Holder elects to purchase ___________ shares of the Common/Series ______ Preferred [strike one] Stock of TimeLine, Inc. pursuant to the terms of the attached Warrant, and tenders payment of the purchase price of the shares in full.

                       [or]

          1.          Holder elects to convert the attached Warrant into Shares/cash [strike one] in the manner specified in the Warrant.  This conversion is exercised for _____________________ of the Shares covered by the Warrant.

          [Strike paragraph that does not apply.]

          2.          Please issue a certificate or certificates representing the shares in the name specified below:

	
  
 
  	
  

  	
  
 
  
	
  
 
  	
  
              Holders   Name
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  

  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  

  	
  
 
  
	
   
  	
  
              (Address)
  	
  
 
  

          3.          By its execution below and for the benefit of the Company, Holder hereby restates each of the representations and warranties in Article 4 of the Warrant as the date hereof.

	
  
 
  	
  
HOLDER:
  
	
  
 
  	
  

  
	
  
 
  	
  
 
  
	
  
 
  	
  
By:
  	
  
 
  
	
  
 
  	
  
 
  	
  

  
	
  
 
  	
  
Name:
  	
  
 
  
	
  
 
  	
  
 
  	
  

  
	
   
  	
  Title:
  	
   
  
	
   
  	
   
  	
  

  
	
   
  	
  (Date):
  	
   
  
	
   
  	
   
  	
  

  

EXHIBIT A
SILICON VALLEY BANK
 ANTIDILUTION AGREEMENT

          THIS ANTIDILUTION AGREEMENT is entered into as of the Warrant Effective Date, by and between Silicon Valley Bank (“Purchaser”) and the Company whose name appears on the last page of this Antidilution Agreement.

RECITALS

          A.          Concurrently with the execution of this Antidilution Agreement, the Purchaser is purchasing from the Company a Warrant to Purchase Stock (the “Warrant’) pursuant to which Purchaser has the right to acquire from the Company the Shares (as defined in the Warrant).

          B.          By this Antidilution Agreement, the Purchaser and the Company desire to set forth the adjustment in the number of Shares issuable upon exercise of the Warrant as a result of a Diluting Issuance (as defined in Exhibit A to the Warrant).

          C.          Capitalized terms used herein shall have the same meaning as set forth in the Warrant.

                        NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions hereinafter set forth, the parties hereto mutually agree as follows:

          1.          Definitions.  As used in this Antidilution Agreement, the following terms have the following respective meanings:

                                     (a)          “Option” means any right, option, or warrant to subscribe for, purchase, or otherwise acquire common stock or Convertible Securities.

                                     (b)          “Convertible Securities” means any evidences of indebtedness, shares of stock, or other securities directly or indirectly convertible into or exchangeable for common stock.

                                     (c)          “Issue” means to grant, issue, sell, assume, or fix a record date for determining persons entitled to receive, any security (including Options), whichever of the foregoing is the first to occur.

                                     (d)          “Additional Common Shares” means all common stock (including reissued shares) issued (or deemed to be issued pursuant to Section 2) after the date of the Warrant.  Additional Common Shares does not include, however, any common stock issued in a transaction described in Sections 2.1 and 2.2 of the Warrant; any common stock Issued upon conversion of preferred stock outstanding on the date of the Warrant; the Shares; or common stock Issued as incentive or in a nonfinancing transaction to employees, officers, directors, or consultants to the Company.

          2.          Deemed Issuance of Additional Common Shares.  The shares of common stock ultimately Issuable upon exercise of an Option (including the shares of common stock ultimately Issuable upon conversion or exercise of a Convertible Security Issuable pursuant to an Option) are deemed to be Issued when the Option is Issued.  The shares of common stock ultimately Issuable upon conversion or exercise of a Convertible Security (other than a Convertible Security Issued pursuant to an Option) shall be deemed Issued upon Issuance of the Convertible Security.  The maximum amount of common stock Issuable is determined without

regard to any future adjustments permitted under the instrument creating the Options or Convertible Securities.

          3.          Adjustment of Warrant Price for Diluting Issuances.

                       3.1     Weighted Average Adjustment.  If the Company issues Additional Common Shares after the date of the Warrant and the consideration per Additional Common Share (determined pursuant to Section 9) is less than the Warrant Price in effect immediately before such Issue, the Warrant Price shall be reduced, concurrently with such Issue, to a price (calculated to the nearest hundredth of a cent) determined by multiplying the Warrant Price by a fraction:

                                        (a)     the numerator of which is the amount of such common stock outstanding immediately before such Issue plus the amount of common stock that the aggregate consideration received by the Company for the Additional Common Shares would purchase at the Warrant Price in effect immediately before such Issue, and 

                                        (b)     the denominator of which is the amount of common stock outstanding immediately before such Issue plus the number of such Additional Common Shares.

                       3.2     Adjustment of Number of Shares.  Upon each adjustment of the Warrant Price, the number of Shares issuable upon exercise of the Warrant shall be increased to equal the quotient obtained by dividing (a) the product resulting from multiplying (i) the number of Shares issuable upon exercise of the Warrant and (ii) the Warrant Price, in each case as in effect immediately before such adjustment, by (b) the adjusted Warrant Price.

                       3.3     Securities Deemed Outstanding.  For the purpose of this Section 3, all securities issuable upon exercise of any outstanding Convertible Securities or Options, warrants, or other rights to acquire securities of the Company shall be deemed to be outstanding.

          4.          No Adjustment for Issuances Following Deemed Issuances.  No adjustment to the Warrant Price shall be made upon the exercise of Options or conversion of Convertible Securities.

          5.          Adjustment Following Changes in Terms of Options or Convertible Securities.  If the consideration payable to, or the amount of common stock Issuable by, the Company increases or decreases, respectively, pursuant to the terms of any outstanding Options or Convertible Securities, the Warrant Price shall be recomputed to reflect such increase or decrease.  The recomputation shall be made as of the time of the Issuance of the Options or Convertible Securities.  Any changes in the Warrant Price that occurred after such Issuance because other Additional Common Shares were Issued or deemed Issued shall also be recomputed.

          6.          Recomputation Upon Expiration of Options or Convertible Securities.  The Warrant Price computed upon the original Issue of any Options or Convertible Securities, and any subsequent adjustments based thereon, shall be recomputed when any Options or rights of conversion under Convertible Securities expire without having been exercised.  In the case of Convertible Securities or Options for common stock, the Warrant Price shall be recomputed as if the only Additional Common Shares Issued were the shares of common stock actually Issued upon the exercise of such securities, if any, and as if the only consideration received therefor was the consideration actually received upon the Issue, exercise or conversion of the Options or Convertible Securities.  In the case of Options for Convertible Securities, the Warrant Price
shall

be recomputed as if the only Convertible Securities Issued were the Convertible Securities actually Issued upon the exercise thereof, if any, and as if the only consideration received therefor was the consideration actually received by the Company (determined pursuant to Section 9), if any, upon the Issue of the Options for the Convertible Securities.

          7.          Limit on Readjustments.  No readjustment of the Warrant Price pursuant to Sections 5 or 6 shall increase the Warrant Price more than the amount of any decrease made in respect of the Issue of any Options or Convertible Securities.

          8.          30 Day Options.  In the case of any Options that expire by their terms not more than 30 days after the date of Issue thereof, no adjustment of the Warrant Price shall be made until the expiration or exercise of all such Options.

          9.          Computation of Consideration.  The consideration received by the Company for the Issue of any Additional Common Shares shall be computed as follows:

                      (a)          Cash.  Cash shall be valued at the amount of cash received by the Corporation, excluding amounts paid or payable for accrued interest or accrued dividends.

                      (b)          Property.  Property other than cash shall be computed at the fair market value thereof at the time of the Issue as determined in good faith by the Board of Directors of the Company.

                      (c)          Mixed Consideration.  The consideration for Additional common Shares Issued together with other property of the Company for consideration that covers both shall be determined in good faith by the Board of Directors.

                      (d)          Options and Convertible Securities.  The consideration per Additional Common Share for Options and Convertible Securities shall be determined by dividing:

                                      (i)          the total amount, if any, received or receivable by the Company for the Issue of the Options or Convertible Securities, plus the minimum amount of additional consideration (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such consideration) payable to the Company upon exercise of the Options or conversion of the Convertible Securities, by

                                      (ii)          the maximum amount of common stock (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such number) ultimately Issuable upon the exercise of such Options or the conversion of such Convertible Securities.

          10.          General.

                      10.1          Governing Law.  This Antidilution Agreement shall be governed in all respects by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within California.

                      10.2          Successors and Assigns.  Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto.

                      10.3          Entire Agreement.  Except as set forth below, this Antidilution Agreement and the other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof.

                      10.4          Notices, etc.  All notices and other communications required or permitted hereunder shall be in writing and shall be mailed by first class mail, postage prepaid, certified or registered mail, return receipt requested, addressed (a) if to Purchaser at Purchaser’s address as set forth below, or at such other address as Purchaser shall have furnished to the Company in writing, or (b) if to the Company, at the Company’s address set forth below, or at such other address as the Company shall have furnished to the Purchaser in writing.

                      10.5          Severability.  In case any provision of this Antidilution Agreement shall be invalid, illegal, or unenforceable, the validity, legality and enforceability of the remaining provisions of this Antidilution Agreement shall not in any way be affected or impaired thereby.

                      10.6          Titles and Subtitles.  The titles of the sections and subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Antidilution Agreement.

                      10.7          Counterparts.  This Antidilution Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

	
       PURCHASER

    	
        

    	
       COMPANY

    
	
        

    	
        

    	
        

    
	
      SILICON
        VALLEY BANK

    	
        

    	
       TIMELINE, INC.

    
	
        

    	
        

    	
        

    	
        

    	
        

    
	
       By:

    	
      /s/ PAUL
        HEIMSTRA

    	
        

    	
       By:

    	
       /s/
        CHARLES R. OSENBAUGH

    
	
        

    	
      

    	
        

    	
        

    	
      

    
	
      Name:

    	
      Paul Heimstra

    	
        

    	
       Name:

    	
       Charles
        R. Osenbaugh

    
	
        

    	
                (print)

    	
        

    	
        

    	
                 (print)

    
	
       Title:

    	
      Vice President

    	
        

    	
       Title:

    	
       Chairman of the
        Board, President or Vice President

    

EXHIBIT A

Anti-Dilution Provisions
 (For Preferred Stock or Common Stock Warrants Where
 Anti-Dilution Protection is Inadequate or Non-existent)

          In the event of the issuance (a “Diluting Issuance”) by the Company, after the Issue Date of the Warrant, of securities at a price per share less than the Warrant Price, or, if the Shares are common stock, less than the then conversion price of the Company’s Series __ Preferred Stock, then the number of shares of common stock issuable upon conversion of the Shares, or if the Shares are common stock, the number of Shares issuable upon exercise of the Warrant, shall be adjusted as a result of Diluting Issuances in accordance with the Holder’s standard form of Anti-Dilution Agreement in effect on the Issue Date.

          Under no circumstances shall the aggregate Warrant Price payable by the Holder upon exercise of the Warrant increase as a result of any adjustment arising from a Diluting Issuance.

“EXHIBIT B”
 SILICON VALLEY BANK
 REGISTRATION RIGHTS AGREEMENT

          THIS REGISTRATION RIGHTS AGREEMENT is entered into as of Warrant Effective Date, by and between Silicon Valley Bank (“Purchaser”) and the Company whose name appears on the last page of this Agreement. 

RECITALS

          A.          Concurrently with the execution of this Agreement, the Purchaser is purchasing from the Company a Warrant to Purchase Stock (the “Warrant”) pursuant to which Purchaser has the right to acquire from the Company the Shares (as defined in the Warrant).

          B.          By this Agreement, the Purchaser and the Company desire to set forth the registration rights of the Shares all as provided herein.

          C.          Capitalized terms used herein shall have the same meaning as set forth in the Warrant.

                        NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions hereinafter set forth, the parties hereto mutually agree as follows:

          1.          Registration Rights.  The Company covenants and agrees as follows:

                       1.1          Definitions.  For purposes of this Section 1:

                                      (a)          The term “register,” “registered,” and “registration” refer to a registration effected by preparing and filing a registration statement or similar document in compliance with the Securities Act of 1933, as amended (the “Securities Act”), and the declaration or ordering of effectiveness of such registration statement or document;

                                      (b)          The term “Registrable Securities” means (i) the Shares (if Common Stock) or all shares of Common Stock of the Company issuable or issued upon conversion of the Shares and (ii) any Common Stock of the Company issued as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, any stock referred to in (i).

                                      (c)          The terms “Holder” or “Holders” means the Purchaser or qualifying transferees under subsection 1.8 hereof who hold Registrable Securities.

                                      (d)          The term “SEC” means the Securities and Exchange Commission.

                       1.2          Company Registration.

                                      (a)          Registration.  If

     at any time or from time to time, the Company shall determine to register
     any of its securities, for its own account or the account of any of its
     shareholders, other than a registration on Form S-1 or S-8
     relating solely to employee stock option or purchase plans, or a
     registration on Form S-4 relating solely to an SEC Rule 145
     transaction, or a registration on any other form (other than Form S-1,
     S-2, S-3 or S-18, or their successor forms) or any successor to such forms,
     which does not include substantially the same information as would be required to be included in a registration statement covering the sale of Registrable Securities, the Company will:

                                                     (i)          promptly give to each Holder written notice thereof (which shall include a list of the jurisdictions in which the Company intends to attempt to qualify such securities under the applicable blue sky or other state securities laws); and

                                                     (ii)          include in such registration (and compliance), and in any underwriting involved therein, all the Registrable Securities specified in a written request or requests, made within 30 days after receipt of such written notice from the Company, by any Holder or Holders, except as set forth in subsection 1.2(b) below.

                                      (b)          Underwriting.  If the registration of which the Company gives notice is for a registered public offering involving an underwriting, the Company shall so advise the Holders as a part of the written notice given pursuant to subsection 1.2 (a) (i).  In such event the right of any Holder to registration pursuant to this subsection 1.2 shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein.  All Holders proposing to distribute their securities through such underwriting shall (together with the Company and the other
shareholders distributing their securities through such underwriting) enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by the Company.

                       1.3          Expenses of Registration.  All expenses incurred in connection with any registration, qualification or compliance pursuant to this Section 1 including without limitation, all registration, filing and qualification fees, printing expenses, fees and disbursements of counsel for the Company and expenses of any special audits incidental to or required by such registration, shall be borne by the Company except the Company shall not be required to pay underwriters’ fees, discounts or commissions relating to Registrable Securities.  All expenses of any registered offering not otherwise borne by the Company shall be borne pro rata among the Holders participating in the offering and the Company.

                       1.4          Registration Procedures.  In the case of each registration, qualification or compliance effected by the Company pursuant to this Registration Rights Agreement, the Company will keep each Holder participating therein advised in writing as to the initiation of each registration, qualification and compliance and as to the completion thereof.  Except as otherwise provided in subsection 1.3, at its expense the Company will:

                                      (a)          Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use its best efforts to cause such registration statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for up to 120 days.

                                      (b)          Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement.

                                      (c)          Furnish to the Holders such numbers of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them.

                                      (d)          Use its best efforts to register and qualify the securities covered by such registration statement under such other securities or Blue Sky laws of such jurisdictions as shall be reasonably requested by the Holders, provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions.

                                      (e)          In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter of such offering.  Each Holder participating in such underwriting shall also enter into and perform its obligations under such an agreement.

                                      (f)          Notify each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act or the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing.

                       1.5          Indemnification.

                                      (a)          The Company will indemnify each Holder of Registrable Securities and each of its officers, directors and partners, and each person controlling such Holder, with respect to which such registration, qualification or compliance has been effected pursuant to this Rights Agreement, and each underwriter, if any, and each person who controls any underwriter of the Registrable Securities held by or issuable to such Holder, against all claims, losses, expenses, damages and liabilities (or actions in respect thereto) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any prospectus, offering circular or other document (including
any related registration statement, notification or the like) incident to any such registration, qualification or compliance, or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statement therein not misleading, or any violation or alleged violation by the Company of the Securities Act, the Securities Exchange Act of 1934, as amended, (“Exchange Act”) or any state securities law applicable to the Company or any rule or regulation promulgated under the Securities Act, the Exchange Act or any such state law and relating to action or inaction required of the Company in connection with any such registration, qualification of compliance, and will reimburse each such Holder, each of its officers, directors and partners, and each person controlling such Holder, each such underwriter and each person who controls any such underwriter, within a reasonable amount of time after incurred for any reasonable legal and any
other expenses incurred in connection with investigating, defending or settling any such claim, loss, damage, liability or action; provided, however, that the indemnity agreement contained in this subsection 1.5 (a) shall not apply to amounts paid in settlement of any such claim, loss, damage, liability, or action if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld); and provided further, that the Company will not be liable in any such case to the extent that any such claim, loss, damage or liability arises out of or is based on any untrue statement or omission based upon written information furnished to the Company by an instrument duly executed by such Holder or underwriter specifically for use therein.

                                      (b)          Each Holder will, if Registrable Securities held by or issuable to such Holder are included in the securities as to which such registration, qualification or compliance is being effected, indemnify the Company, each of its directors and officers, each underwriter, if any, of the Company’s securities covered by such a registration statement, each person who controls the Company within the meaning of the Securities Act, and each other such Holder, each of its officers, directors and partners and each person controlling such

Holder, against all claims, losses, expenses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any such registration statement, prospectus, offering circular or other document, or any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse the Company, such Holders, such directors, officers, partners, persons or underwriters for any reasonable legal or any other expenses incurred in connection with investigating, defending or settling any such claim, loss, damage, liability or action, in each case to the extent, but only to the extent, that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such registration statement, prospectus, offering circular or other document in reliance upon and in
conformity with written information furnished to the Company by an instrument duly executed by such Holder specifically for use therein; provided, however, that the indemnity agreement contained in this subsection 1.5(b) shall not apply to amounts paid in settlement of any such claim, loss, damage, liability or action if such settlement is effected without the consent of the Holder, (which consent shall not be unreasonably withheld); and provided further, that the total amount for which any Holder shall be liable under this subsection 1.5(b) shall not in any event exceed the aggregate proceeds received by such Holder from the sale of Registrable Securities held by such Holder in such registration.

                                      (c)          Each party entitled to indemnification under this subsection 1.5 (the “Indemnified Party”) shall give notice to the party required to provide indemnification (the “Indemnifying Party”) promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom; provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval shall not be unreasonably withheld), and the Indemnified Party may participate
in such defense at such party’s expense; and provided further, that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations hereunder, unless such failure resulted in prejudice to the Indemnifying Party; and provided further, that an Indemnified Party (together with all other Indemnified Parties which may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the fees and expenses to be paid by the Indemnifying Party, if representation of such Indemnified Party by the counsel retained by the Indemnifying Party would be inappropriate due to actual or potential differing interests between such Indemnified Party and any other party represented by such counsel in such proceeding.  No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement
which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation.

                       1.6          Information by Holder.  Any Holder or Holders of Registrable Securities included in any registration shall promptly furnish to the Company such information regarding such Holder or Holders and the distribution proposed by such Holder or Holders as the Company may request in writing and as shall be required in connection with any registration, qualification or compliance referred to herein.

                       1.7          Rule 144 Reporting.  With a view to making available to Holders the benefits of certain rules and regulations of the SEC which may permit the sale of the Registrable Securities to the public without registration, the Company agrees at all times to:

                                      (a)          make and keep public information available, as those terms are understood and defined in SEC Rule 144, after 90 days after the effective date of the first registration filed by the Company for an offering of its securities to the general public;

                                      (b)          file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements); and

                                      (c)          so long as a Holder owns any Registrable Securities, to furnish to such Holder forthwith upon request a written statement by the Company as to its compliance with the reporting requirements of said Rule 144 (at any time after 90 days after the effective date of the first registration statement filed by the Company for an offering of its securities to the general public), and of the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements), a copy of the most recent annual or quarterly report of the Company, and such other reports and documents so filed by the Company as the Holder may reasonably request in complying with
any rule or regulation of the SEC allowing the Holder to sell any such securities without registration.

                       1.8          Transfer of Registration Rights.  Holders’ rights to cause the Company to register their securities and keep information available, granted to them by the Company under subsections 1.2 and 1.7 may be assigned to a transferee or assignee of a Holder’s Registrable Securities not sold to the public, provided, that the Company is given written notice by such Holder at the time of or within a reasonable time after said transfer, stating the name and address of said transferee or assignee and identifying the securities with respect to which such registration rights are being assigned.  The Company may prohibit the transfer of any Holders’ rights under this subsection 1.8 to any proposed transferee or assignee who the
Company reasonably believes is a competitor of the Company.

          2.          General.

                       2.1          Waivers and Amendments.  With the written consent of the record or beneficial holders of at least a majority of the Registrable Securities, the obligations of the Company and the rights of the Holders of the Registrable Securities under this agreement may be waived (either generally or in a particular instance, either retroactively or prospectively, and either for a specified period of time or indefinitely), and with the same consent the Company, when authorized by resolution of its Board of Directors, may enter into a supplementary agreement for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement; provided, however, that no such modification, amendment or waiver shall reduce the
aforesaid percentage of Registrable Securities without the consent of all of the Holders of the Registrable Securities.  Upon the effectuation of each such waiver, consent, agreement of amendment or modification, the Company shall promptly give written notice thereof to the record holders of the Registrable Securities who have not previously consented thereto in writing.  This Agreement or any provision hereof may be changed, waived, discharged or terminated only by a statement in writing signed by the party against which enforcement of the change, waiver, discharge or termination is sought, except to the extent provided in this subsection 2.1.

                       2.2          Governing Law.  This Agreement shall be governed in all respects by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within California.

                       2.3          Successors and Assigns.  Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto.

                       2.4          Entire Agreement.  Except as set forth below, this Agreement and the other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof.

                       2.5          Notices, etc.  All notices and other communications required or permitted hereunder shall be in writing and shall be mailed by first class mail, postage prepaid, certified or registered mail, return receipt requested, addressed (a) if to Holder, at such Holder’s address as set forth below, or at such other address as such Holder shall have furnished to the Company in writing, or (b) if to the Company, at the Company’s address set forth below, or at such other address as the Company shall have furnished to the Holder in writing.

                       2.6          Severability.  In case any provision of this Agreement shall be invalid, illegal, or unenforceable, the validity, legality and enforceability of the remaining provisions of this Agreement or any provision of the other Agreement s shall not in any way be affected or impaired thereby.

                       2.7          Titles and Subtitles.  The titles of the sections and subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement.

                       2.8          Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

	
       PURCHASER

    	
        

    	
       COMPANY

    
	
        

    	
        

    	
        

    
	
       SILICON
        VALLEY BANK

    	
        

    	
       TIMELINE, INC.

    
	
       

    	
        

    	
        

    
	
       By:

    	
       /s/ PAUL
        HEIMSTRA

    	
        

    	
       By:

    	
       /s/ CHARLES
        R. OSENBAUGH

    
	
        

    	
      

    	
        

    	
        

    	
      

    
	
       Name:

    	
       Paul Heimstra

    	
        

    	
       Name:

    	
       Charles R. Osenbaugh

    
	
      Title:

    	
       Vice President

    	
        

    	
       Title:

    	
       President

    

EXHIBIT B

Registration Rights

          The Shares (if common stock), or the common stock issuable upon conversion of the Shares, shall be deemed “registrable securities” or otherwise entitled to “piggy back” registration rights in accordance with the terms of the following agreement (the “Agreement”) between the Company and its investor(s):

	
  
 
  	
  

  	
  
 
  
	
   
  	
  [Identify Agreement by date, title and parties.  If no Agreement exists, indicate by   “none”.]
  	
   
  
	
   
  	
   
  	
   
  

          The Company agrees that no amendments will be made to the Agreement, which would have an adverse impact on Holder’s registration rights thereunder without the consent of Holder.  By acceptance of the Warrant to which this Exhibit B is attached, Holder shall be deemed to be a party to the Agreement, unless Holder otherwise elects not to become or to cease being a party thereto.

          If no Agreement exists, then the Company and the Holder shall enter into Holder’s standard form of Registration Rights Agreement as in effect on the Issue Date of the Warrant.September 29 2004 8K Exhibit 10.1

                                                          Exhibit 10.1

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment
Agreement (the "Agreement") is effective as of July 1, 2004
(the "Effective Date") by MarketWatch, Inc. (the "Company")
and Lawrence S. Kramer (the "Executive").  This Agreement supercedes
and replaces all previous agreements between the Company and Executive (the
"parties") with regard to its subject matter. 

	Term of Employment.  The Company shall continue to employ Executive
for a period of three years following the Effective Date, unless earlier
terminated pursuant to Sections 7 or 8 (such term being hereinafter referred to
as the "Employment Period").

	Title; Duties.  The Executive shall serve as Chief Executive Officer
of the Company reporting to the Board of Directors of the Company or similar
governing body of the Company (the "Board"), provided, however, that
the Board shall be permitted to appoint any person to the position of President,
with duties and responsibilities inherent in such position, without breaching
this Agreement.  Executive shall perform those duties and responsibilities
inherent in the position of Chief Executive Officer, including such duties and
responsibilities as the Board shall reasonably assign.  Executive shall serve
the Company faithfully and to the best of his ability in such capacity, devoting
his full business time, attention, knowledge, energy and skills to such
employment; provided, however, the Company acknowledges that Executive may serve
on the board of directors of other companies with the prior approval of the
Board.  Executive shall not engage in other employment during the Employment
Period.  Executive shall travel as reasonably required in connection with the
performance of his duties hereunder.

	Board Position.  Executive currently serves as Chairman of the
Company's Board.  During the Employment Period, the Company shall use its best
efforts to continue to nominate and elect Executive as a director, and Executive
shall serve in such capacity without additional consideration. 

	Compensation. The Company shall pay, and Executive shall accept, as
full consideration for his services hereunder, compensation consisting of the
following:

	Base Salary.  Executive shall receive a base salary of $350,000 per
year ("Base Salary") during the Employment Period.  Base Salary is
payable in installments in accordance with the Company's normal payroll
practices, less such deductions or withholdings as are required by law.  The
Company shall review Executive's Base Salary on an annual basis, and may
increase Executive's Base Salary in its sole discretion.

	Bonus.  During the Employment Period, Executive shall be eligible for
an annual target bonus (the "Target Bonus") equal to one year of
Executive's Base Salary, calculated in accordance with the specifications on
Exhibit A attached hereto.

	Equity Grants.  Subject to approval by the Compensation Committee,
the Executive shall be granted (a) an option to purchase 200,000 shares of
the Company's common stock with an exercise price per share equal to the fair
market value of the Company's common stock as of the date of the grant (the
"New Option") and (b) 85,000 shares of restricted stock of the
Company (the "Restricted Shares").  The New Option and Restricted
Shares will be issued under the Company's 2004 Stock Incentive Plan (the
"Plan").

	New Option.  If granted, the New Option shall vest and become
exercisable as to one-third of the total shares subject to the New Option on
each of the first two anniversaries of the Effective Date, and as to the
remaining one-third of the total shares subject to the New Option on June 30,
2007, contingent upon Executive's continued employment with the Company on such
dates.

	Restricted Shares.  The Restricted Shares shall vest upon the earlier
of (i) achievement of the following performance objectives or (ii) the
fifth anniversary of the date of grant, contingent upon Executive's continued
employment with the Company on such date(s).  25% of the Restricted Shares shall
vest if the Company achieves Earnings Per Share ("EPS") by the end of
fiscal year 2005 that equals or exceeds the target EPS approved by the Board at
its strategic planning meeting for fiscal year 2005.  An additional 25% of the
Restricted Shares shall vest if the Company achieves EPS by the end of fiscal
year 2006 that equals or exceeds the target EPS approved by the Board at its
strategic planning meeting for fiscal year 2006.  The remaining 50% of the
Restricted Shares shall vest at the end of fiscal year 2007 if the Company
achieves EPS by the end of fiscal year 2007 that equals or exceeds the target
EPS approved by the Board at its strategic planning meeting for fiscal year
2007.

Executive shall be eligible to receive periodic equity grants, awarded at the
Compensation Committee's discretion in amounts based upon the competitive
marketplace and the performance of Executive and the Company, including grants
consistent with the Company's practices with respect to awarding equity grants
to other executives.  Such equity participation shall be in vehicles of the
Compensation Committee's choosing including, but not limited to, performance
shares, restricted stock, stock options and stock appreciation rights payable in
stock.

	Benefits.  Subject to all applicable eligibility requirements and
legal limitations, Executive will be able to participate in any and all 401(k),
vacation, medical, dental, life and long-term disability insurance and/or other
benefit plans which from time to time may be established for other employees of
the Company. 

	Reimbursement of Expenses.  The Company will reimburse Executive for
all reasonable travel, entertainment and other expenses incurred or paid by the
Executive in connection with, or related to, the performance of his duties,
responsibilities or services under this Agreement, subject to reasonable review
by the Board or its compensation committee, if applicable. 

	Benefits Upon Termination of Employment Period. 

	Disability.  In the event of the permanent disability (as hereinafter
defined) of Executive during the Employment Period, the Company shall have the
right, upon written notice to Executive, to terminate Executive's employment
hereunder, effective upon the 30th calendar day following the giving
of such notice (or such later day as shall be specified in such notice).  Upon
the effective date of such termination:  (i) the Company shall have no
further obligations hereunder, except to pay and provide, subject to applicable
withholding, (A) all amounts of Base Salary accrued, but unpaid, at the
effective date of termination, (B) Executive's Target Bonus for the year in
which such disability occurs, and (C) all reasonable unreimbursed business-
related expenses; (ii) any outstanding, unvested options to acquire shares
of the Company's common stock ("Options") held by Executive on the
date of such termination shall be deemed to vest on a monthly basis (with
1/36th of the total number of shares subject to each outstanding
Option vesting for each month of continued employment of Executive) and such
Options shall immediately vest and become exercisable to the extent that such
Options would have vested if Executive had remained employed during an
additional 12 months measured from the termination date and shall remain
exercisable for the periods specified in the relevant option agreements;
and (iii) Executive shall have no further obligations hereunder other
than those provided for in Sections 10, 11 and 12 hereof. All amounts
payable to Executive pursuant to this Section 7.1 shall be payable within
30 days following the effectiveness of the termination of Executive's
employment.  For purposes of this Agreement, "permanent disability"
shall be defined as any physical or mental disability or incapacity which
renders Executive incapable in any material respect of performing the services
required of him in accordance with his obligations under Section 2 for a
period of 180 consecutive days, or for 180 days in any 360-day period. 

	Death.  In the event of the death of Executive during the Employment
Period, this Agreement shall automatically terminate and the Company shall have
no further obligations hereunder, except to pay and provide to Executive's
beneficiary or other legal representative, subject to applicable withholding,
(i) all amounts of Base Salary and bonus accrued but unpaid at the date of
death and (ii) all reasonable unreimbursed business-related expenses. All
amounts payable to Executive pursuant to this Section 7.2 shall be payable
within 30 days following the date of death. 

	Termination Without Cause or Resignation for Good Reason.  In the
event Executive's employment with the Company is terminated by the Company
without Cause (as defined below in Section 7.3(a)) or by Executive for Good
Reason (as defined below in Section 7.3(b)), the Company shall pay
Executive all amounts of Base Salary accrued but unpaid on the date of
termination, and any accrued but unused vacation time.  In addition, Executive
shall be eligible to receive the following severance benefits ("Severance
Benefits"):  (i) severance payments equal to 18 months of Executive's
then-applicable Base Salary, payable in equal monthly installments
("Severance Period"); (ii) 1.5 times the Target Bonus for the
year in which such termination occurs; (iii) any outstanding Options held by
Executive on the date of such termination shall be deemed to vest on a monthly
basis (with 1/36th of the total number of shares subject to each
outstanding Option vesting for each month of continued employment of Executive)
and such Options shall immediately vest and become exercisable to the extent
that such Options would have vested if Executive had remained employed during
the Severance Period, and shall remain exercisable for the periods specified in
the relevant option agreements.  Executive's eligibility for the
foregoing Severance Benefits is conditioned on (a) Executive having first
signed a release of claims in a form provided by the Company, and
(b) Executive's agreement not to perform services as an employee or
consultant for any of the following entities during the Severance Period:
Bloomberg, Reuters, Dow Jones, CNN Money, Street.com, Briefing.com, MSNBC.com,
or Thomson (including their affiliates and joint ventures).  If Executive
engages in such activity during the Severance Period, all payments and benefits
immediately shall cease, and Executive shall be given a period of 30 days
thereafter to exercise any vested Options.  If Executive becomes eligible for
Change of Control Severance Benefits under Section 8.1 below, Executive
shall not be eligible for the foregoing Severance Benefits.

	Definition of Cause.  For purposes of this Agreement,
"Cause" shall be limited to:

	Executive's willful failure to substantially perform his duties hereunder,
other than a failure resulting from his complete or partial incapacity due to
physical or mental illness or impairment, which failure is not cured within
thirty days after written notice to Executive from the Company;
	A material and willful violation of a federal or state law or regulation
applicable to the business of the Company or that adversely affects the image of
the Company;
	Commission of a willful act by Executive which constitutes gross misconduct
and is injurious to the Company;
	Executive's willful breach of a material provision of this Agreement, which
breach is not cured within thirty days after written notice to Executive from
the Company;
	A willful act of dishonesty, fraud or embezzlement in connection with
Executive's duties; or
	Conviction of a felony.

	Definition of Good Reason.  Executive's termination shall be for
"Good Reason" if Executive provides written notice to the Company of
the Good Reason within thirty days of the event constituting Good Reason and
provides the Company with a period of twenty days to cure the event constituting
Good Reason, but the Company fails to cure the Good Reason within that period.
For purposes of this Agreement, "Good Reason" shall mean any of the
following events: 

	A material adverse change in Executive's duties and responsibilities as
Chief Executive Officer, causing them to be of materially less stature or
responsibility, without Executive's consent;
	An adverse change in Executive's job title as Chief Executive Officer or a
change in Executive's reporting relationships that results in Executive no
longer reporting directly to the Board of Directors;
	A reduction in Executive's Base Salary or Target Bonus, without Executive's
consent;
	A relocation of Executive's principal place of employment by more than fifty
miles without Executive's consent; or
	The failure of a successor entity to assume the Company's obligations under
this Agreement upon a Change in Control (as defined below).

Executive's replacement as the Company's Chairman shall not constitute
"Good Reason" for purposes of this Agreement.

	Termination for Cause or Resignation Without Good Reason.  If the
Employment Period is terminated for Cause or if Executive voluntarily terminates
his employment other than for Good Reason, the Company shall pay any Base Salary
and Bonus fully earned and unpaid on the date of termination, and thereafter all
obligations of the Company shall cease.

	Change of Control Benefits.

	Termination Following a Change of Control.  In the event the Company
terminates Executive without Cause, or Executive resigns with Good Reason,
within 90 days prior to a Change of Control or within six (6) months following a
Change of Control, the Company shall pay Executive all amounts of Base Salary
accrued but unpaid on the date of termination, and any accrued but unused
vacation time, upon the termination date.  In addition, Executive shall be
eligible to receive the following enhanced severance benefits ("Change of
Control Severance Benefits"):  (i) severance payments equal to 24
months of Executive's then-applicable Base Salary, payable in equal monthly
installments ("Change of Control Severance Period"); (ii) the
Target Bonus for each full year of the Change of Control Severance Period; and
(iii) the unvested portion of any outstanding Options or Restricted Shares
held by Executive on the date of such Change in Control shall immediately vest
and become exercisable in full, and shall remain exercisable for the periods
specified in the relevant option agreements.  Executive's eligibility for the
foregoing Change of Control Severance Benefits is conditioned on
(a) Executive having first signed a release of claims in a form provided by
the Company, and (b) Executive's agreement not to perform services as an
employee or consultant for any of the following entities during the Severance
Period:  Bloomberg, Reuters, Dow Jones, CNN Money, Street.com, Briefing.com,
MSNBC.com, or Thomson (including their affiliates or joint ventures).  If
Executive engages in such activity during the Change of Control Severance
Period, all payments and benefits immediately shall cease, and Executive shall
be given a period of 30 days thereafter to exercise any vested Options.

	Definition of Change of Control.  The term "Change of
Control" shall mean: 

	The sale, lease, conveyance, liquidation or other disposition of all or
substantially all of the Company's assets as an entirety or substantially as an
entirety to any person, entity or group of persons; or
	Any transaction or series of related transactions (as a result of a tender
offer, merger, consolidation or otherwise) that results in any Person (as
defined in Section 13(h)(8)(E) under the Securities Exchange Act of 1934)
becoming the beneficial owner (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934), directly or indirectly, of more than 50% of
the aggregate voting power of all classes of common equity securities of the
Company, except if such Person is (i) a subsidiary of the Company,
(ii) an employee stock ownership plan for employees of the Company, or
(iii) a company formed to hold the Company's common equity securities, and
whose shareholders constituted, at the time such company became such holding
company, substantially all the equity owners or shareholders of the Company..

	Tax Determinations.  In the event that the severance and other
benefits provided to Executive pursuant to this Agreement and any other
agreement, benefit, plan, or policy of the Company (i) constitute
"parachute payments" within the meaning of Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code"), and
(ii) but for this Section 9, such severance and benefits would be
subject to the excise tax imposed by Section 4999 of the Code, then
Executive's severance and other benefits under this Agreement and any other
agreement, benefit, plan, or policy of the Company shall be payable either:
(a) in full; or (b) as to such lesser amount which would result in no
portion of such severance and other benefits being subject to excise tax under
Section 4999 of the Code, whichever of the foregoing amounts, taking into
account the applicable federal, state and local income taxes and the excise tax
imposed by Section 4999, results in the receipt by Executive on an after-tax
basis, of the greatest amount of severance and other benefits under this
Agreement and any other agreement, benefit, plan, or policy of the Company.

Unless the Company and Executive otherwise agree in writing, any
determination required under this Section 9 shall be made in writing by
independent public accountants agreed to by the Company and Executive (the
"Accountants"), whose determination shall be conclusive and binding
upon Executive and the Company for all purposes.  For purposes of making the
calculations required by this Section 9, the Accountants may make
reasonable assumptions and approximations concerning applicable taxes and may
rely on reasonable, good faith interpretations concerning the application of
Sections 280G and 4999 of the Code.  The Company and Executive shall
furnish to the Accountants such information and documents as the Accountants may
reasonably request in order to make a determination under this Section 9.
The Company shall bear all costs the Accountants may reasonably incur in
connection with any calculations contemplated by this Section 9. 

	Dispute Resolution.  Executive and the Company agree that any
dispute, controversy or claim between them shall be settled exclusively by final
and binding arbitration in accordance with the National Rules for the Resolution
of Employment Disputes of the American Arbitration Association (the "AAA
Rules").  A neutral and impartial arbitrator shall be chosen by mutual
agreement of the parties or, if the parties are unable to agree upon an
arbitrator within a reasonable period of time, then a neutral and impartial
arbitrator shall be appointed in accordance with the arbitrator nomination and
selection procedure set forth in the AAA Rules.  The arbitrator shall apply the
same substantive law, with the same statutes of limitations and remedies, that
would apply if the claims were brought in court.  The arbitrator also shall
prepare a written decision containing the essential findings and conclusions
upon which the decision is based.  Either party may bring an action in court to
compel arbitration under this Agreement or to enforce an arbitration award.
Otherwise, neither party shall initiate or prosecute any lawsuit in any way
related to any claim subject to this agreement to arbitrate.  Any arbitration
held pursuant to this paragraph shall take place in San Francisco, California.
The Company shall pay the costs of the arbitrator.  If, for any legal reason, a
controversy or claim between the parties cannot be arbitrated as provided in
this Section 10, the parties agree that any civil action shall be brought
in the United States District Court for the Northern District of California or,
only if there is no basis for federal jurisdiction, in the Superior Court of the
State of California in and for the City and County of San Francisco.  The
parties further agree that any such civil action shall be tried to the court,
sitting without a jury. 

	Cooperation with the Company After Termination of the Employment
Period.  Following termination of the Employment Period, Executive shall
fully cooperate with the Company in all matters relating to the winding up of
his pending work on behalf of the Company and the orderly transfer of any such
pending work to other employees of the Company as may be designated by the
Company. 

	Confidentiality; Return of Property; Non-Solicitation Of Employees.

	Executive acknowledges that during the Employment Period he will receive
confidential information from the Company and subsidiaries of the Company and
the respective customers thereof (each a "Relevant Entity").
Accordingly, the Executive agrees that during the Employment Period (as it may
be extended from time to time) and thereafter for a period of two years, the
Executive and his affiliates shall not, except in the performance of his
obligations to the Company hereunder or as may otherwise be approved in advance
by the Company, directly or indirectly, disclose or use (except for the direct
benefit of the Company) any confidential information that he may learn or has
learned by reason of his association with any Relevant Entity.  Upon termination
of this Agreement, the Executive shall promptly return to the Company any and
all properties, records or papers of any Relevant Entity, that may have been in
his possession at the time of termination, whether prepared by the Executive or
others, including, but not limited to, confidential information and keys.  For
purposes of this Agreement, "confidential information" includes all
data, analyses, reports, interpretations, forecasts, documents and information
concerning a Relevant Entity and its affairs, including, without limitation with
respect to clients, products, policies, procedures, methodologies, trade secrets
and other intellectual property, systems, personnel, confidential reports,
technical information, financial information, business transactions, business
plans, prospects or opportunities, (i) that the Company reasonably believes
are confidential or (ii) the disclosure of which could be injurious to a
Relevant Entity or beneficial to competitors of a Relevant Entity, but shall
exclude any information that (x) the Executive is required to disclose
under any applicable laws, regulations or directives of any government agency,
tribunal or authority having jurisdiction in the matter or under subpoena or
other process of law, (y) is or becomes publicly available prior to the
Executive's disclosure or use of the information in a manner violative of the
second sentence of this Section 12.1, or (z) is rightfully received by
Executive without restriction or disclosure from a third party legally entitled
to possess and to disclose such information without restriction (other than
information that he may learn or has learned by reason of his association with
any Relevant Entity). For purposes of this Agreement, "affiliate"
means any entity that, directly or indirectly, is controlled by, or under common
control with, the Executive.  For purposes of this definition, the terms
"controlled" and "under common control with" means the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of such person, whether through the ownership of
voting stock, by contract or otherwise. 
	For a period of one year following the termination of Executive's employment
with the Company for any reason, he will not, without the Company's express
written consent, either on his own behalf or on behalf of another,
(a) solicit any of the Company's customers, clients, members, business
partners or suppliers, or (b) solicit or otherwise induce any person
employed by the Company to terminate his or her employment.

	General.  

	Indemnification.  In the event Executive is made, or threatened to be
made, a target, subject, witness or party to any civil, criminal or
administrative action, proceeding or investigation by reason of the fact that
Executive is or was a director or officer of the Company, or serves or served
any other corporation fifty percent (50%) or more owned by the Company in any
capacity at the Company's request, or serves or served as a director of any
other corporation at the Company's request, or serves or served as a fiduciary
of any ERISA plan at the Company's request, Executive shall be indemnified by
the Company for all amounts paid as a fine or settlement or judgment, and the
Company shall pay without any undertaking the Executive's defense costs when and
as incurred, all to the fullest extent permitted by law. 

	Waiver.  Neither party shall, by mere lapse of time, without giving
notice or taking other action hereunder, be deemed to have waived any breach by
the other party of any of the provisions of this Agreement. Further, the waiver
by either party of a particular breach of this Agreement by the other shall
neither be construed as nor constitute a continuing waiver of such breach or of
other breaches by the same or any other provision of this Agreement. 

	Severability.  If for any reason a court of competent jurisdiction or
arbitrator finds any provision of this Agreement to be unenforceable, the
provision shall be deemed amended as necessary to conform to applicable laws or
regulations, or if it cannot be so amended without materially altering the
intention of the parties, the remainder of the Agreement shall continue in full
force and effect as if the offending provision were not contained herein. 

	Notices.  All notices and other communications required or permitted
to be given under this Agreement shall be in writing and shall be considered
effective upon personal service or upon transmission of a facsimile or the
deposit with Federal Express or in Express Mail and addressed to the Board of
the Company at its principal corporate address, and to Executive at his most
recent address shown on the Company's corporate records, or at any other address
which he may specify in any appropriate written notice to the Company. 

	Counterparts.  This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which taken
together constitutes one and the same instrument and in making proof hereof it
shall not be necessary to produce or account for more than one such counterpart.

	Entire Agreement.  The parties hereto acknowledge that each has read
this Agreement, understands it, and agrees to be bound by its terms.  The
parties further agree that this Agreement shall constitute the complete and
exclusive statement of the agreement between the parties and supersedes all
proposals (oral or written), understandings, representations, conditions,
covenants, and all other communications between the parties relating to the
subject matter hereof. 

	Governing Law.  This Agreement shall be governed by the law of the
State of California. 

	Assignment and Successors.  The Company shall have the right to
assign its rights and obligations under this Agreement to an entity which
acquires substantially all of the assets of the Company, whether by merger or
otherwise.  The rights and obligations of the Company under this Agreement shall
inure to the benefit and shall be binding upon the successors and assigns of the
Company. 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.

 

MARKETWATCH.COM, INC.

/s/ Kathy Yates

Kathy Yates

President and Chief Operating Officer

 

EXECUTIVE 

/s/ Lawrence S. Kramer

Lawrence S. Kramer

 

Exhibit A

BONUS SPECIFICATIONS

Executive's Target Bonus shall be divided into four equal components:
(1) Company achievement of its annual revenue target, as established by the
Board ("Company Revenue Achievement"); (2) Company achievement of
its annual target of EBITDA, as established by the Board ("Company EBITDA
Achievement"); (3) Company achievement of its annual free cash flow
target, as established by the Board ("Company Free Cash Flow
Achievement"); and (4) the average percentage of MBO achievement by
Executive's direct reports for that fiscal year.

For each fiscal year of the Employment Term, the Board shall establish target
performance levels for Company Revenue Achievement, Company EBITDA Achievement,
and Company Free Cash Flow Achievement.  Each bonus component shall be assigned
a value of 25 points for achievement of the target performance level.
Therefore, Executive shall be eligible to receive 100% of his Target Bonus if he
earns 100 bonus points, or a lesser or greater percentage based on the number of
bonus points earned.
Bonus Achievement Targets for Fiscal Year 2004

The target performance levels established by the Board for fiscal year
2004 are set forth below.  New target performance levels will be established by
the Board for each subsequent fiscal year:

	
Company Revenue Achievement for FY 2004
	
Points

	
Under $* million
	
0

	
$* million-$* million
	
10

	
>$* million-$* million
	
20

	
>$* million-$* million-Target
	
25

	
Over $* million
	
30

	
Company EBITDA Achievement for FY 2004
	
Points

	
Under $* million
	
0

	
$* million-$* million
	
10

	
>$* million-$* million
	
20

	
>$* million-$* million-Target
	
25

	
Over $* million
	
30

	
Company Free Cash Flow Achievement for FY 2004
	
Points

	
Under $* million
	
0

	
$* million-$* million
	
10

	
>$* million-$* million-Target
	
25

	
Over $* million
	
30

4)Executive shall be awarded up to 25 points based on the average
percentage of MBO achievement by Executive's direct reports.  For example, if
the average MBO achievement of Executive's direct reports is 75%, Executive
shall receive 18.75 points (or 75% of 25 points).

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