Document:

EXHIBIT
      10.2

    

    REDEMPTION
      AGREEMENT

    

    This
      Redemption Agreement (this “Agreement”),
      dated
      as of August 8, 2007, is entered into by and among Surge Global Energy, Inc.,
      a
      Delaware corporation (“Company”),
      and
      Gemini Master Fund, Ltd. (“Investor”).

    

    R
      E C I T A L S:

    

      
WHEREAS,
      the Investor purchased 2,000,000 shares (the “Shares”)
      of
      common stock, par
      value
      $0.001 per share (“Common
      Stock”),
      of
      the Company pursuant to that certain Securities Purchase Agreement (as amended,
      the “Purchase
      Agreement”)
      and
      that certain Registration Rights Agreement (as amended, the “Registration
      Rights Agreement”),
      each
      dated as of November 28, 2006;

    

    WHEREAS,
      in consideration for the surrender of the Shares, an additional $250,000 cash
      investment, and a temporary waiver of breaches under the Registration Rights
      Agreement, on or about April 19, 2007 the Company issued to the Investor a
      Convertible Note Due May 1, 2008 in the original principal amount of $1,150,000
      (the “Note”)
      pursuant to that certain Exchange, Purchase and Amendment Agreement dated on
      or
      about April 19, 2007 (“Amendment”);
      initially capitalized terms used in this Agreement and not otherwise defined
      shall have the respective meanings ascribed thereto in the Note;

    

    WHEREAS,
      pursuant to Section 5 of the Note, the Investor has delivered a Mandatory
      Redemption Notice to the Company following an Event of Default under the Note;
      and

    

    WHEREAS,
      the Company has requested that the Mandatory Redemption Date be postponed until
      November 1, 2007 in contemplation of a potential revocation of the Mandatory
      Redemption Notice by the Investor, and the Investor wishes to accommodate such
      request, on the terms and conditions contained herein;

    

    A
      G R E E M E N T:

    

    NOW
      THEREFORE, in consideration of the foregoing premises and the mutual covenants
      set forth in this Agreement, and for other good and valuable consideration,
      the
      receipt and sufficiency of which are hereby acknowledged, the parties hereto
      agree as follows:

    

    1. Postponement
      of Redemption Date.
      The
      Mandatory Redemption Date shall be postponed until November 1, 2007 (as may
      be
      extended as provided herein, the “Revised
      Mandatory Redemption Date”).
      The
      Company and the Investor acknowledge and agree that the Mandatory Redemption
      Price is $1,380,000.
      The Company acknowledges
      and agrees that (a) the Investor may revoke the Mandatory Redemption Notice
      in
      its sole and absolute discretion (in which case the Company shall not redeem
      the
      Note), (b) the Mandatory Redemption Notice is currently and shall remain valid
      and in full force and effect unless and until revoked by the Investor, and
      (c)
      an Event of Default has occurred and is continuing and, unless the Mandatory
      Redemption Notice is revoked by the Investor prior to the Investor’s actual
      receipt of the Mandatory Redemption Price on or after the Revised Mandatory
      Redemption Date, the Company shall redeem the Note for the Mandatory Redemption
      Price on the Revised Mandatory Redemption Date notwithstanding any curing or
      discontinuance of the Event of Default. On or prior to November 1, 2007, the
      Investor may extend the Revised Mandatory Redemption Date until December 31,
      2007. On or about October 25, 2007, the Investor shall deliver to the Company
      (which may be by fax or a digital image file (e.g.
      PDF) to
      the address set forth in Section 6 below) a written notice (“Direction
      Notice”)
      in the
      form of Exhibit A hereto electing to either (i) redeem the Note for the
      Mandatory Redemption Price on the Revised Mandatory Redemption Date, (ii) revoke
      the Mandatory Redemption Notice, or (iii) extend the Revised Mandatory
      Redemption Date until December 31, 2007. If the Investor elects clauses (i)
      or
      (ii) above, the Investor shall also deliver such Direction Notice to the Escrow
      Agent (as defined below). If the Investor elects to extend the Revised Mandatory
      Redemption Date, then the Company shall redeem the Note for the Mandatory
      Redemption Price on December 31, 2007 unless prior to such date the Investor
      submits another Direction Notice electing to revoke the Mandatory Redemption
      Notice. If the Mandatory Redemption Price is not paid in full to the Investor
      within two (2) business days following the Revised Mandatory Redemption Date
      on
      which the Mandatory Redemption is intended to occur, any unpaid portion of
      the
      Mandatory Redemption Price shall increase at the Default Interest Rate. The
      Company shall remain liable for payment of the Mandatory Redemption Price in
      full to the extent the funds delivered to the Investor from the Escrow Agent
      are
      less than the Mandatory Redemption Price for any reason.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    2. Registration.
      Notwithstanding the delivery and effectiveness of the Mandatory
      Redemption Notice, the Company shall register the resale of the Conversion
      Shares in accordance with the terms of the Registration Rights
      Agreement.

     

    3. Escrow.
      Contemporaneously with the execution hereof, the Company and the Investor hereby
      agree to enter into an escrow agreement (“Escrow
      Agreement”)
      with
      Torrey Pines Bank, a California banking association, as escrow agent
      (“Escrow
      Agent”),
      in
      the form of Exhibit I attached hereto. Immediately upon execution of this
      Agreement and such Escrow Agreement, the Company shall deposit with Escrow
      Agent
      an amount equal to One Million Three Hundred Eighty Thousand Dollars
      ($1,380,000) in immediately available funds to be held in escrow pursuant to
      the
      terms of the Escrow Agreement. This Agreement shall not become effective until
      the Escrow Agent receives such funds.

     

    4. Notices.
      All
      notices, requests, demands and other communications provided for by this
      Agreement shall be in writing and shall be deemed to have been given when hand
      delivered, when received if sent by facsimile or email or by same day or
      overnight recognized commercial courier service or three business days after
      being mailed in any general or branch office of the United States Postal
      Service, enclosed in a registered or certified postpaid envelope, addressed
      to
      the address of the parties stated below or to such changed address as such
      party
      may have fixed by notice:

     

    If
      to the
      Company:

    

    Surge
      Global Energy, Inc.:

    12220
      El
      Camino Real, Ste. 410 

    San
      Diego, California 92130

    Attn:
      Bill Greene

    Facsimile:
      (858) 704-5011

    Email:
      Bill@SurgeGlobalEnergy.com

     

    With
      a copy to (if applicable) (other than Direction Notice):

    Luce,
      Forward, Hamilton & Scripps, LLP

    11988
      El
      Camino Real Ste. 200

    San
      Diego, California 92130

    Attn:
      Dennis J. Doucette 

    Facsimile:
      (858) 523-4305

    

    If
      to
the
      Investor:

    

    Gemini
      Master Fund, Ltd.

    c/o
      Gemini Strategies, LLC 

    12220
      El
      Camino Real, Suite 400

    San
      Diego, CA 92130-2091 

    Attn: Steven
      Winters

    Fax:
       (858)
      509-8808

    

    With
      a copy to:

    Peter
      J.
      Weisman, P.C.

    52
      Vanderbilt Avenue, 17th
      Floor

    New
      York,
      NY 10017  

    Fax:
      (212)
      317-8855

    Email:
      pweisman@pweisman.com

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    5. Execution
      of Agreement.
      This
      Agreement may be executed in one or more counterparts, each of which will be
      deemed to be an original copy of this Agreement and all of which, when taken
      together, will be deemed to constitute one and the same agreement. The exchange
      of copies of this Agreement and of signature pages by facsimile transmission
      or
      PDF shall constitute effective execution and delivery of this Agreement as
      to
      the parties and may be used in lieu of the original Agreement for all purposes.
      Signatures of the parties transmitted by facsimile or PDF shall be deemed to
      be
      their original signatures for any purposes whatsoever.

     

    6. Section
      Headings, Construction.
      The
      headings of sections in this Agreement are provided for convenience only and
      will not affect its construction or interpretation.

     

    7. Waiver.
      The
      rights and remedies of the parties to this Agreement are cumulative and not
      alternative. Neither the failure nor any delay by any party in exercising any
      right, power or privilege under this Agreement or the documents referred to
      in
      this Agreement will operate as a waiver of such right, power or privilege,
      and
      no single or partial exercise of any such right, power or privilege will
      preclude any other or further exercise of such right, power or privilege or
      the
      exercise of any other right, power or privilege. To the maximum extent permitted
      by applicable law: (a) no claim or right arising out of this Agreement or the
      documents referred to in this Agreement can be discharged by one party, in
      whole
      or in part, by a waiver or renunciation of the claim or right unless in writing
      signed by the other party; (b) no waiver that may be given by a party will
      be
      applicable except in the specific instance for which it is given; and (c) no
      notice to or demand on one party will be deemed to be a waiver of any obligation
      of such party or of the right of the party giving such notice or demand to
      take
      further action without notice or demand as provided in this Agreement or the
      documents referred to in this Agreement.

     

    8. Entire
      Agreement and Modification.
      This
      Agreement supersedes all prior agreements among the parties with respect to
      its
      subject matter and constitutes (along with the documents referred to in this
      Agreement) a complete and exclusive statement of the terms of the agreement
      between the parties with respect to its subject matter. This Agreement may
      not
      be amended except by a written agreement executed by the Company and the
      Investor.

     

    9. Governing
      Law; Jurisdiction.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York applicable to contracts made and to be performed entirely
      within the State of New York. The Company irrevocably submits to the
      non-exclusive jurisdiction of any State or Federal Court sitting in San Diego,
      California, over any suit, action, or proceeding arising out of or relating
      to
      this Note. The Company irrevocably waives, to the fullest extent permitted
      by
      law, any objection which it may now or hereafter have to the laying of the
      venue
      of any such suit, action, or proceeding brought in such a court and any claim
      that suit, action, or proceeding has been brought in an inconvenient forum.
      The
      Company agrees that the service of process upon it mailed by certified or
      registered mail (and service so made shall be deemed complete three days after
      the same has been posted as aforesaid) or by personal service shall be deemed
      in
      every respect effective service of process upon it in any such suit or
      proceeding. Nothing herein shall affect any party’s right to serve process in
      any other manner permitted by law. The Company agrees that a final
      non-appealable judgment in any such suit or proceeding shall be conclusive
      and
      may be enforced in other jurisdictions by suit on such judgment or in any other
      lawful manner. THE COMPANY HERETO KNOWINGLY AND VOLUNTARILY WAIVES ANY AND
      ALL
      RIGHTS IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION BASED
      ON,
      OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
      AGREEMENT.

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    10. Miscellaneous.

     

    (a) Full
      Force and Effect.
      Except
      as otherwise expressly provided herein, each of the Purchase Agreement, the
      Registration Rights Agreement, the Amendment, the Note, the Warrants and the
      other agreements and transactions contemplated thereby (“Transaction
      Documents”)
      shall
      remain in full force and effect. Except for any waivers and modifications
      contained herein, if any, this Agreement shall not in any way waive or prejudice
      any of the rights or obligations of the Investor or the Company under the
      Transaction Documents, under any law, in equity or otherwise, and such waivers
      and modifications shall not constitute a waiver or modification of any other
      provision of the Transaction Documents nor a waiver or modification of any
      subsequent default or breach of any obligation of the Company or of any
      subsequent right of the Investor.

     

    (b) Authority.
      Each
      party hereto hereby represents and warrants to the other party that the
      execution and delivery by such party of this Agreement, and the performance
      by
      such party of its obligations hereunder, have been duly and validly authorized
      by such party, with no other action on the part of such party being necessary.
      This Agreement has been duly and validly executed and delivered by such party
      and constitutes a legal, valid and binding obligation of such party enforceable
      against such party in accordance with its terms.

     

    (c) Further
      Assurances.
      Each
      party shall do and perform, or cause to be done and performed, all such further
      acts and things, and shall execute and deliver all such other agreements,
      certificates, instruments and documents, as the other party may reasonably
      request in order to carry out the intent and accomplish the purposes of this
      Agreement and the consummation of the transactions contemplated
      hereby.

     

    (d) Assignment;
      Successors.
      The
      Investor may assign this Agreement or its respective rights or obligations
      hereunder in connection with any transfer of the Note. This Agreement shall
      be
      binding upon each party’s respective successors.

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties have executed and delivered this Agreement as
      of
      the date first written above.

     

    

    COMPANY:

    

    SURGE
      GLOBAL ENERGY, INC.

    

    

    By:
      /s/
      William Greene

    Name:
      William Greene

    Title:
      CFO

    

    

    INVESTOR:

    

    GEMINI
      MASTER FUND, LTD.

    By:
       GEMINI
      STRATEGIES, LLC, as investment manager

    

    

    By:         
      /s/ Peter
      Weisman

    Name:
      Peter Weisman

    Title:
      Managing Director

     

    
      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

    

    

    Exhibit
      A

    DIRECTION
      NOTICE

    

    Date:
      ____________________

    

    Surge
      Global Energy, Inc.

    12220
      El
      Camino Real, Ste. 410 

    San
      Diego, California 92130

    Attn:
      Bill Greene

    Facsimile:
      (858) 704-5011

    Email:
      Bill@SurgeGlobalEnergy.com

     

    Torrey
      Pines Bank

    12220
      El
      Camino Real, Ste. 120 

    San
      Diego, California 92130

    Attn:
      Teofla Rich, SVP

    Facsimile:
      858-755-2134

    Email:
      TRich@TorreyPinesBank.com

    

    Reference
      is made to (1) that certain Redemption Agreement (“Redemption Agreement”) dated
      as of August 8, 2007 between Surge Global Energy, Inc. (“Company”) and Gemini
      Master Fund, Ltd. (“Investor”), and (2) that certain Escrow Agreement (“Escrow
      Agreement”) dated as of August 8, 2007 among the Company, the Investor and
      Torrey Pines Bank, as escrow agent (“Escrow Agent”). Initially capitalized terms
      used in this Direction Notice but not defined herein shall have the meanings
      ascribed to them in the Escrow Agreement.

     

    Pursuant
      to the Escrow Agreement, Gemini Master Fund, Ltd. elects to:

    

    1.    
      Redeem
      the Note for the Mandatory Redemption Price and hereby
      directs the Escrow Agent to distribute the Mandatory
      Redemption Price to the Investor by wire transfer to the following account
      on:

    —  
      November 1, 2007

    —  
      December 31, 2007

    

    Chase
      Manhattan Bank, N.Y.

    ABA# 021-000-021

    F/A/O
       Goldman
      Sachs & Co., N.Y.

    A/C#
       930-1-011483

    F/F/C
       Gemini
      Master Fund, Ltd.

    FFC#
       002-36198

    

    2.    Revoke
      the Mandatory Redemption Notice and hereby
      directs the Escrow Agent to distribute the Mandatory
      Redemption Price to the Company by transfer to the Company’s bank account held
      at the Escrow Agent (A/C # 0339002522).

    

    3.    Extend
      the Revised Mandatory Redemption Date (as defined in the Redemption Agreement)
      until December 31, 2007.1 

    

    GEMINI
      MASTER FUND, LTD.

    By:
       GEMINI
      STRATEGIES, LLC, as investment manager

    

    By:
      _______________________________

    Steven
      Winters, President

    

      

      
        1 
          If this election is made, this Direction Notice will only
          be
          delivered to the Company until another election is
          made.Exhibit 4.2

 

FOUNDER STOCK PURCHASE
AGREEMENT

 

This Founder Stock Purchase Agreement (this “Agreement”) dated as of December 28, 2005 (the “Effective Date”) is entered into by and
between DeMarseCo, Inc., a Delaware corporation (the “Company”), and Elisabeth DeMarse (“Founder,” which term includes his or her
heirs, personal representatives, successors, and assigns).

 

In consideration of the mutual promises and covenants contained in this
Agreement, the parties agree as follows:

 

Section 1.                SALE OF SHARES; CLOSING.

 

1.1      Sale
of Shares. Subject
to the terms and conditions of this Agreement, at the Closing (as defined
below), the Company shall issue and sell to Founder, and Founder shall
purchase, 586,636 shares of the Company’s common stock, par value $0.001 per
share (the “Common Stock”), at the
purchase price of $0.001 per share. The shares of Common Stock being sold and
purchased under this Agreement are referred to as the “Shares.”

 

1.2      Closing.
The closing of the
issuance, sale, and purchase of the Shares (the “Closing”) shall take place at the offices of Vinson &
Elkins L.L.P., The Terrace 7, 2801 Via Fortuna, Suite 100, Austin, Texas at
10:00 a.m., local time, on the Effective Date or at such other place or such
other time as the Company and Founder may agree. At the Closing, the Company
shall deliver to Founder a certificate representing the Shares being purchased
by Founder, registered in the name of Founder, against payment to the Company
of the purchase price for such Shares by wire transfer, check, or other method
acceptable to the Company.

 

Section 2.                DEFINITIONS.

 

For purposes of this Agreement:

 

“Act” means the Securities Act of 1933, as amended.

 

“Austin Ventures” or “AV”
means Austin Ventures VIII, L.P.

 

“Cause” means “cause” as defined in
Founder’s employment or service agreement or in the absence of such an
agreement or such a definition, “Cause”
shall mean a determination by the Company’s board of directors that Founder (a)
has engaged in personal dishonesty, willful violation of any law, rule, or
regulation (other than minor traffic violations or similar offenses), or breach
of fiduciary duty involving personal profit, (b) is unable to satisfactorily
perform or has failed to satisfactorily perform Founder’s duties and
responsibilities for the Company or any affiliate, (c) has been convicted of,
or plead nolo contenders to, any
felony or a crime involving moral turpitude, (d) has engaged in negligence or
willful misconduct in the performance of his or her duties, including but not
limited to willfully refusing without proper legal reason to perform Founder’s
duties and responsibilities, (e) has materially breached any corporate policy
or code of conduct established by the Company or any affiliate as such policies
or codes may be adopted from time to time, (f) any violation by Founder of the
terms of the Proprietary Information and Inventions Agreement or any other
agreement between Founder and the Company related to Founder’s employment or
other service with the Company, or (g) has engaged in conduct that is

 

 

likely
to have a deleterious effect on the Company or any affiliate or their
legitimate business interests, including but not limited to their goodwill and
public image.

 

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

 

“Corporate Transaction” means either (i) the Company shall not be the
surviving entity in any merger, share exchange, or consolidation (or survives
only as a subsidiary of an entity), (ii) the Company sells, leases, or
exchanges, or agrees to sell, lease, or exchange, all or substantially all of
its assets to any other person or entity, (iii) the Company is to be dissolved
and liquidated, (iv) any person or entity, including a “group” as contemplated by Section 13(d)(3)
of the Securities Exchange Act of 1934, acquires or gains ownership or control
(including, without limitation, power to vote) of more than 50% of the
outstanding shares of the Company’s voting stock (based upon voting power), or
(v) at such time as the Company becomes a reporting company under the Securities
Exchange Act of 1934, as a result of or in connection with a contested election
of directors, the persons who were directors of the Company before such
election shall cease to constitute a majority of the board of directors; provided
that a Corporate Transaction shall not include (A) any reorganization, merger,
consolidation, sale, lease, exchange, or similar transaction, which involves
solely the Company and one or more entities wholly-owned, directly or
indirectly, by the Company immediately prior to such event or (B) the
consummation of any transaction or series of integrated transactions
immediately following which the record holders of the voting stock of the
Company immediately prior to such transaction or series of transactions
continue to hold 50% or more of the voting stock (based upon voting power) of
(1) any entity that owns, directly or indirectly, the stock of the Company, (2)
any entity with which the Company has merged, or (3) any entity that owns an
entity with which the Company has merged.

 

“Lien” means any lien, security interest, pledge, mortgage, deed of trust,
charge, or encumbrance in real, personal, or mixed property, tangible or
intangible, and wherever located.

 

“Qualified Financing” means the issuance or sale of any preferred stock,
common stock or other stock or similar securities of the Company or any
security convertible or exchangeable into or for preferred stock, common stock
or other stock or similar securities of the Company for cash in a single
transaction or series of related transactions for which Austin Ventures serves
as the lead investor and in which the outstanding indebtedness of the Company
to Austin Ventures is converted into such equity securities.

 

“Termination of Founder’s Service” means the termination of Founder’s employment
or other service with the Company for any reason, with or without cause,
voluntarily or involuntarily.

 

“Unvested Shares” means Shares that are not Vested Shares (as
defined below). On the Effective Date, all Shares are Unvested Shares.

 

“Vested Shares” means Shares that have vested in accordance
with the provisions of Section 3.3. On the Effective Date, no Shares are
Vested Shares.

 

2

 

Section 3.                RESTRICTIONS ON SHARES.

 

3.1                   Transfer Restrictions.

 

(a)                      Founder shall not sell, assign, transfer,
pledge, encumber, or otherwise dispose of (each, a “transfer”) any Shares or any interest in any Shares, except
as provided in this Agreement.

 

(b)                     Any attempted transfer of Shares other than in
accordance with this Agreement and any Transfer Restriction Agreements (as
defined below) shall be null and void, and the Company shall refuse to
recognize any such transfer and shall not reflect on its records any change in
record ownership of Shares pursuant to any such transfer.

 

(c)                      Founder acknowledges that the Shares may be
subjected to further transfer restrictions, including, but not limited to,
rights of first refusal and co-sale in connection with one or more transactions
in which the Company issues shares of its preferred stock, par value $0.001 per
share, and Founder agrees to execute such agreements (“Transfer Restriction Agreements”)
evidencing such restrictions as the Company may reasonably request.

 

3.2                   Repurchase Option. The Company shall have a right and option
(the “Repurchase Option”) to
purchase Unvested Shares from Founder in accordance with the following
provisions:

 

(a)                      The Company may exercise the Repurchase Option
at any time during the 45-day period following the Termination of Founder’s
Service. Failure of the Company to exercise its Repurchase Option within such
45-day period shall be deemed to constitute a notification to Founder of the
Company’s decision not to exercise its Repurchase Option.

 

(b)                     The purchase price for Unvested Shares
purchased upon exercise of the Repurchase Option shall be $0.001 per share.

 

(c)                      The Repurchase Option shall be exercisable by
the Company by written notice delivered to Founder or his or her personal
representative prior to the expiration of the 45-day period specified in Subsection
3.2(a). Such notice shall indicate the number of Unvested Shares to be
purchased and the date (not later than 10 days after the date of expiration of
the Repurchase Option) on which the purchase is to be effected. To the extent
one or more certificates representing Unvested Shares may have been previously
delivered out of escrow to Founder, Founder, prior to the close of business on
the date specified for the repurchase, shall deliver to the Company the
certificate(s) representing the Unvested Shares to be purchased, each
certificate to be properly endorsed for transfer and free and clear of any
restrictions (other than the restrictions imposed under this Agreement and any
Transfer Restriction Agreements), Liens, or claims, against payment of the
purchase price for the Unvested Shares by check payable to the order of
Founder.

 

(d)                     If the Company shall make available, at the
time and place and in the amount and form provided in this Agreement, the
consideration for the Unvested Shares to be repurchased in accordance with the
provisions of this Agreement, then from and after such time,

 

3

 

Founder
shall no longer have any rights as a holder of such Unvested Shares (other than
the right to receive payment of such consideration in accordance with this
Agreement), and such Unvested Shares shall be deemed purchased in accordance
with the applicable provisions of this Agreement and the Company shall be
deemed the owner and holder of such shares, whether or not the certificates for
such shares have been delivered as required by this Agreement.

 

(e)                      In the event of any stock dividend, stock
split, recapitalization, or other change affecting the outstanding Common Stock
as a class effected without consideration, then any new, substituted, or
additional securities or other property (including money paid other than as a
regular cash dividend) that is by reason of any such transaction distributed
with respect to the Unvested Shares shall be immediately subject to the
Repurchase Option to the extent the Unvested Shares are at the time covered by
such Repurchase Option. Appropriate adjustments to reflect the distribution of
such securities or property shall be made to the number of Unvested Shares under
this Agreement and to the price per share to be paid upon the exercise of the
Repurchase Option in order to reflect the effect of any such transaction upon
the Company’s capital structure.

 

3.3                   Vesting; Termination of
Repurchase Option.

 

(a)                      Unvested Shares shall vest in cumulative
increments according to the following schedule: (i) 10% of all Unvested Shares
(i.e., 58,664 shares) shall vest upon the closing of the Qualified Financing,
(ii) an additional 15% of all Unvested Shares (i.e., 87,995 shares) shall vest
upon the first anniversary of the closing of the Qualified Financing, (iii) an
additional 20% of all Unvested Shares (i.e., 117,327 shares) shall vest upon
each of the second, third and fourth anniversaries of the closing of the
Qualified Financing, and (iv) the remaining 15% of all Unvested Shares (i.e.,
87,996 shares) shall vest upon the fifth anniversary of the closing of the
Qualified Financing. In addition, all Unvested Shares shall immediately vest
upon the consummation of any Corporate Transaction that occurs following the
Qualified Financing.

 

(b)                     Notwithstanding anything in this Agreement to
the contrary, the Unvested Shares shall cease to vest immediately upon
Termination of Founder’s Service.

 

(c)                      Upon the vesting of Unvested Shares, the
Repurchase Option shall automatically terminate with respect to such Shares,
and such Shares shall become Vested Shares and shall no longer be subject to
the Repurchase Option, but shall nevertheless remain subject to the other
provisions of this Agreement and to any Transfer Restriction Agreements.

 

3.4                   Company’s Right of First
Refusal.

 

(a)                      Except for the Company’s Repurchase Option set
forth in Section 3.2, Founder shall not transfer any Unvested Shares.
Founder agrees that if Founder intends to transfer any or all of the Vested
Shares, Founder will first give the Company notice in writing of such proposed
transfer. Such notice (the “Notice”)
will contain (1) the name and address of Founder and the proposed transferee,
(2) the terms and conditions of such transfer, including, in the event that any
third party offer has been received by Founder and Founder intends to accept
such offer, the purchase price, and if such price is to be paid in whole or in
part in consideration other than cash, a full and complete description of such
non-cash consideration, and (3) an offer

 

4

 

(the
“Required Offer”) to sell such
Vested Shares to the Company at a price per share equal to the proposed
consideration for the transfer of such Vested Shares. The board of directors of
the Company will determine the fair cash equivalent of any proposed
consideration that is other than cash. At any time during the 30-day period
immediately following the delivery of the Notice to the Company, the Company
will have the exclusive right and option, but not the obligation, to accept the
Required Offer and proceed with the purchase of such Vested Shares pursuant to
such Required Offer. In the event the Company does not exercise its rights as
set forth in this Section, Founder will be free to transfer such Vested Shares
under the terms and conditions stated in the Notice; provided, however,
that if such transfer does not take place within 60 days following the delivery
of the Notice to the Company, the terms of this Section must once again be
followed prior to the transfer of the Vested Shares. Any Vested Shares that are
transferred pursuant to the preceding provisions of this Section will continue
to be subject to the right of first refusal set forth in this Section
subsequent to any such transfer. If at any time a proposed transfer by Founder
applies to less than all of the Vested Shares of Founder, the right of first
refusal granted in this Agreement to the Company will remain in full force and effect
as to the remainder of such Vested Shares, regardless of whether it is
exercised with respect to such initial portion. Founder may not pledge or
otherwise encumber any of the Vested Shares without the written consent of the
Company.

 

(b)                     The right of first refusal stated in this
Agreement will survive the termination of this Agreement. The Company also has
the right to assign the right of first refusal stated in this Agreement. The
right of first refusal stated in this Agreement will not apply to transfers of
Vested Shares pursuant to the laws of descent and distribution; provided,
however, that any such Vested Shares will be subject to the right of first
refusal set forth in this Section subsequent to any such transfer. The right of
first refusal stated in this Agreement will not apply to the exchange of Vested
Shares pursuant to a plan of merger, consolidation, recapitalization, or
reorganization of the Company, but any stock, securities or other property
received in exchange therefor will be subject to the right of first refusal set
forth in this Agreement; provided, however, that any such stock
or securities received in any such merger, consolidation, recapitalization, or
reorganization will not be subject to the right of first refusal set forth in
this Section if the stock or securities received in such merger, consolidation,
recapitalization, or reorganization are registered under the Securities
Exchange Act of 1934. A dissolution or liquidation of the Company will not
trigger the right of first refusal set forth in this Agreement; provided,
however, that a dissolution or a liquidation of the Company within one
year following the sale of all or substantially all of the assets of the
Company in exchange for stock or securities will be considered a reorganization
of the Company. The right of first refusal set forth in this Section will
terminate upon the consummation by the Company of a public offering of Common
Stock pursuant to an effective registration statement under the Act.

 

Section 4.                ESCROW.

 

4.1                   Deposit. Certificates representing the Unvested Shares
shall be deposited in escrow with the Company to be held in accordance with the
provisions of this Section. Each deposited certificate shall be accompanied by
a duly executed assignment separate from certificate in the form attached as Exhibit
A. The deposited certificates, together with any other assets or securities
from time to time deposited with the Company pursuant to the requirements of
this Agreement, shall remain in escrow until such time or times as the
certificates (or other

 

5

 

assets
and securities) are to be released or otherwise surrendered for cancellation in
accordance with Section 4.3. Upon delivery of the certificates (or other
assets and securities) to the Company, the holder shall be issued a deposit
receipt acknowledging the number of Unvested Shares or other assets and
securities delivered in escrow to the Company.

 

4.2                   Recapitalization. Any cash dividends on the Unvested Shares (or
other securities at the time held in escrow) shall be paid directly to the
holder and shall not be held in escrow. However, in the event of any stock
dividend, stock split, recapitalization, or other change affecting the Company’s
outstanding Common Stock as a class effected without consideration, any new,
substituted, or additional securities or other property that by reason of such
transaction is distributed with respect to the Unvested Shares shall be
immediately delivered to the Company to be held in escrow under Section 4,
but only to the extent the Unvested Shares are at the time subject to the
escrow requirements of Section4.1.

 

4.3                   Release; Surrender.

 

(a)                      If the Company exercises the Repurchase Option
with respect to any Unvested Shares, then the escrowed certificates for such
Unvested Shares or the certificates representing such Unvested Shares (together
with any other assets or securities issued with respect to such Unvested
Shares) shall be delivered to the Company for cancellation, concurrently with
the payment to Founder of the amount provided for in Section 3.2(a)
above, as applicable, and Founder shall cease to have any further rights or
claims with respect to such Unvested Shares (or other assets or securities).

 

(b)                     When the Unvested Shares (or any other assets
or securities issued with respect to such Unvested Shares) vest in accordance
with Section 3.3, the certificates for such Vested Shares shall, at
Founder’s request, no more than once in any six month period be promptly
released from escrow and delivered to Founder.

 

(c)                      All shares released from escrow in accordance
with the provisions of Section 4.3(b) nevertheless remain subject to the
other provisions of this Agreement and to any Transfer Restriction Agreements.

 

Section 5.                LEGENDS; STOP TRANSFER.

 

5.1                   Restrictive Legends. In order to reflect the restrictions on the
transfer of the Shares set forth or referred to in this Agreement, the
certificates representing Shares shall be endorsed with legends to the
following effect:

 

“THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS AND
MAY NOT BE SOLD OR TRANSFERRED WITHOUT COMPLIANCE WITH THE REGISTRATION OR
QUALIFICATION PROVISIONS OF APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR
APPLICABLE EXEMPTIONS THEREFROM.”

 

6

 

“THE SHARES REPRESENTED
BY THIS CERTIFICATE MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, ENCUMBERED, OR IN
ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE TERMS OF A FOUNDER STOCK
PURCHASE AGREEMENT BETWEEN THE COMPANY AND THE INITIAL HOLDER OF THE SHARES.
THE FOUNDER STOCK PURCHASE AGREEMENT GRANTS CERTAIN PURCHASE OPTIONS TO THE
COMPANY AND IMPOSES RESTRICTIONS ON THE TRANSFER OF THESE SHARES. A COPY OF THE
FOUNDER STOCK PURCHASE AGREEMENT IS ON DEPOSIT AT THE PRINCIPAL OFFICE OF THE
COMPANY AND WILL BE FURNISHED BY THE COMPANY TO THE REGISTERED HOLDER HEREOF
UPON WRITTEN REQUEST.”

 

5.2                   Enforcement;
Stop Transfer. No Shares shall be transferred on the books of the
Company nor shall any attempted sale, transfer, assignment, pledge, or other
disposition of any Shares be effective unless and until the terms and
provisions of this Agreement and any Transfer Restriction Agreements are first
complied with. Any attempted sale, transfer, assignment, pledge, or other
disposition of any Shares that does not comply with the provisions of this
Agreement and Transfer Restriction Agreements shall be invalid and of no
effect.

 

Section
6.                GENERAL
PROVISIONS.

 

6.1                   Exemption
from Registration. The Shares have not been registered under the Act or
the securities laws of any state and are being issued to Founder in reliance
upon exemptions from such registration under the Act or the securities laws of
any state. Founder understands and agrees that the Shares may not be resold or
transferred without registration under the Act and applicable state securities
laws unless an exemption from such registration is available. Accordingly,
Founder acknowledges that he or she is prepared to hold the Shares for an
indefinite period and that he or she is aware that Rule 144 of the Securities
and Exchange Commission under the Act is not currently available to exempt the
sale of the Shares from the registration requirements of the Act and may not be
available at the time Founder wishes to sell the Shares. Prior to acquiring the
Shares, Founder obtained sufficient information about the Company to reach an
informed decision to acquire the Shares. Founder has such knowledge and
experience in financial and business matters as to make him or her capable of
utilizing such information to evaluate the risks of the prospective, investment
and to make an informed investment decision. Founder is able to bear the
economic risk of his or her investment in the Shares.

 

6.2                   Stockholder
Rights. For so long as Founder holds shares, Founder shall have all the
rights of a stockholder (including voting and dividend rights) with respect to
the Shares, subject in all respects to the provisions of any Transfer
Restriction Agreement.

 

6.3                   Market
Stand-Off. In connection with any underwritten public offering by the
Company of its equity securities pursuant to an effective registration
statement filed under the Act, including the Company’s initial public offering,
Founder shall not sell, make any short sale of, loan, pledge, grant any option
for the purchase of, or otherwise dispose or transfer for

 

7

 

value or otherwise agree
to engage in any of the foregoing transactions with respect to, any shares of
Common Stock without the prior written consent of the Company or its
underwriters, for such period of time (not to exceed 180 days) from and after
the effective date of such registration statement as may be requested by the
Company or such underwriters.

 

6.4                   Section
83(b) Election. Founder understands that, under Section 83 of the Code,
the difference between the purchase price paid for the Shares and its fair
market value at the time any forfeiture restrictions applicable to such shares
lapse may be reportable as ordinary income at that time. For this purpose, the
term “forfeiture restrictions”
includes the right of the Company to repurchase the Shares pursuant to its
Repurchase Option. Founder understands that he or she may elect to be taxed at
the time the Shares are acquired under this Agreement to the extent the fair
market value of the Shares differs from the purchase price, rather than when
and as such Shares cease to be subject to such forfeiture restrictions, by
filing an election under Section 83(b) of the Code with the Internal Revenue
Service within 30 days after the Effective Date. If the fair market value of
the Shares at the time of purchase equals the purchase price paid or if it is
likely that the fair market value of the Shares at the time any forfeiture
restrictions lapse shall exceed the fair market value of the time of purchase,
the election may avoid adverse tax consequences in the future. A form for
making this election is attached as Exhibit B. Founder understands that
the failure to make this filing within said 30-day period shall result in the
recognition of ordinary income by Founder (in the event the fair market value
of the Shares increases after the date of purchase) as the forfeiture
restrictions lapse. Founder acknowledges that
it is his or her sole responsibility, and not the Company’s, to file a timely
election under Section 83(b), even if Founder requests the Company or its
representative to make this filing on his or her behalf.

 

6.5                   Company
Counsel. Founder acknowledges that Vinson & Elkins L.L.P., counsel
for the Company, represented the Company in the transaction contemplated by
this Agreement, including the formation and initial capitalization of the
Company, and has not represented the Founder or any individual shareholder or
employee of the Company in connection with such transactions.

 

6.6                   Assignment.
The Company may assign its Repurchase Option to any person, including, without
limitation, one or more stockholders of the Company.

 

6.7                   No
Employment Contract. Nothing in this Agreement shall confer upon
Founder any right to continue in the employment of the Company for any period
of time or interfere with or restrict in any way the rights of the Company or
Founder, which rights are hereby expressly reserved by each, to terminate the
employment of Founder at any time for any reason whatsoever, with or without
cause.

 

6.8                   Notices.
All notices, requests, consents, and other communications under this Agreement
shall be in writing and shall be deemed effectively given when delivered
personally or by facsimile transmission or by overnight delivery service or 72
hours after having been mailed by first class certified or registered mail,
return receipt requested, postage prepaid:

 

If to the Company,
at 300 West 6th Street, Suite 2300, Austin, Texas 78701, Attention: President
(fax (512) 476-3952), or at such other address or addresses as may

 

8

 

have been furnished in
writing by the Company to Founder, with a copy to Vinson & Elkins L.L.P.,
The Terrace 7, 2801 Via Fortuna, Suite 100, Austin, Texas 78746, Attention:
Kyle K. Fox, Esq. (fax (512) 236-3340).

 

If to Founder, at
the address set forth on the signature page below or at such other address as
may have been furnished in writing by Founder to the Company.

 

6.9                   No Waiver.
The failure of the Company to exercise any Repurchase Option shall not
constitute a waiver of any other Repurchase Option or similar rights that may
subsequently arise under the provisions of this Agreement. No waiver of any
breach or condition of this Agreement shall be deemed to be a waiver of any
other or subsequent breach or condition, whether of like or different nature.

 

6.10            Entire Agreement.
This Agreement constitutes the entire contract between the parties to this
Agreement with regard to the subject matter of this Agreement.

 

6.11            GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS, AND NOT THE LAW OF CONFLICTS, OF THE STATE
OF DELAWARE.

 

6.12            Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed
to be an original, but all of which together shall constitute one and the same
instrument.

 

6.13            Successors and
Assigns. The provisions of this Agreement shall inure to the benefit of
and be binding upon the Company and its respective successors and assigns, and
Founder and his or her legal representatives, heirs, legatees, distributees,
assigns, and transferees by operation of law, whether or not any such person
shall have become a party to this Agreement.

 

[Signature Pages Follow]

 

9

 

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

 

	
   

  	
  DEMARSECO,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
     /s/
  Philip Siegel

  	
   

  
	
   

  	
   

  	
     Philip
  Siegel

  	
   

  
	
   

  	
   

  	
     Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  FOUNDER:

  
	
   

  	
   

  
	
   

  	
  /s/ Elisabeth DeMarse

  	
   

  
	
   

  	
  Elisabeth DeMarse

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Fax

  	
   

  	
   

  
					

 

 

Signature Page to Founder Stock Purchase Agreement

 

 

EXHIBIT A

 

Assignment Separate from
Certificate

 

Elisabeth DeMarse
assigns and transfers to DEMARSECO, INC.
(the “Company”)             
shares of the Common Stock, par value $0.001 per share, of the Company standing
in his or her name on the books of the Company and represented by certificate
number(s)             
and irrevocably appoints                                 
agent to transfer such shares on the books of the Company. The agent may
substitute another to act for him or her.

 

	
  Dated:

  	
  December
  25, 2005

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Elisabeth DeMarse

  	
   

  
	
   

  	
  Elisabeth DeMarse

  	
   

  

 

 

Instructions: Please do
not fill in any blanks other than the signature line. Please sign exactly as
you would like your name to appear on the issued stock certificate. The purpose
of this assignment is to enable the Company to exercise the Repurchase Option
without requiring additional signatures on the part of Founder.

 

A-1

 

EXHIBIT B

 

Section 83(b) Election

 

This statement is made
under Section 83(b) of the Internal Revenue Code of 1986, as amended, pursuant
to Treasury Regulations Section 1.83-2.

 

(1)                     The taxpayer
who performed the services is:

 

Name:  Elisabeth DeMarse

Address:

 

Social
Security No.:

 

(2)                     The property
with respect to which the election is made is 586,636 shares of the common
stock of DEMARSECO, INC.

 

(3)                     The property
was transferred on December 28, 2005.

 

(4)                     The taxable
year for which the election is made is the calendar year 2005.

 

(5)                     The property
is subject to a repurchase right pursuant to which the issuer has the right to
acquire the property at the original purchase price if for any reason taxpayer’s
service with the issuer is terminated. The issuer’s repurchase right lapses in
a series of installments over a five-year period following the closing of the
Company’s next issuance of preferred stock.

 

(6)                     The fair
market value of such property at the time of transfer (determined without
regard to any restriction other than a restriction that, by its terms, shall
never lapse) is $.001 per share.

 

(7)                     The amount
paid for such property is 0.001 per share.

 

(8)                     A copy of
this statement was furnished to DEMARSECO,
INC., for whom taxpayer rendered the services underlying the
transfer of such property.

 

(9)                     This
statement is executed on December 28, 2005.

 

 

	
  /s/ Spouse

  	
   

  	
  /s/ Elisabeth DeMarse

  	
   

  
	
  Signature of Spouse (if
  any)

  	
   

  	
  Signature of Taxpayer

  	
   

  

 

Within 30 days after the date of purchase, this election
must be filed with the Internal Revenue Service Center where the Purchaser files
his or her federal income tax returns. The filing should be made by registered
or certified mail, return receipt requested. The Purchaser must (a) file a copy
of the completed form with his or her federal tax return for the current tax
year and (b) deliver an additional copy to the Company.

 

B-1

 

FIRST AMENDMENT TO FOUNDER STOCK PURCHASE AGREEMENT

 

This FIRST AMENDMENT (this “Amendment”)
to that certain Founder Stock Purchase Agreement (the “Agreement”), dated as of December 28,
2005, by and between DeMarseCo, Inc., a Delaware corporation (the “Company”), and Elisabeth DeMarse (“Founder,”
which term includes his or her heirs, personal representatives, successors and
assigns) is entered into as of September 20, 2006.

 

The Company desires to form DeMarseCo Holdings, Inc. as a Delaware
corporation and wholly owned subsidiary of the Company (“DeMarseCo II”) and transfer certain assets
and rights of the Company to DeMarseCo II pursuant to a Restructuring Agreement
by and among the Company, DeMarseCo II, Austin Ventures VIII, L.P. (the “Investor”), Founder, Phil Siegel, David
Lack and Brett Shobe (the “Restructuring”);

 

In connection with the formation of DeMarseCo II and the Restructuring,
the Company will exchange with Founder 577,779 shares of the common stock, par
value $0.001 per share, of DeMarseCo II held by the Company for 503,963 shares
of common stock, par value $0.001 per share, of the Company (“Common Stock”) held by Founder (the “Share Exchange”);

 

In connection with the Restructuring, the Company has determined that it
is in the best interests of the Company and the stockholders of the Company
that the Company effect a 2.01598140-for-l stock split (the “Stock Split”) with respect to shares of
its Common Stock such that the number of Shares (as defined in the Agreement)
subject to the Agreement will be 166,667 after giving effect to the Share
Exchange and Stock Split; and

 

In connection with the Restructuring and the Stock Split, the Company
and Founder desire to amend the Agreement to modify the vesting provisions
applicable to the Shares.

 

For and in consideration of the premises and the mutual benefits to the
parties arising out of this Amendment, the receipt and sufficiency of which are
hereby acknowledged by the parties’ execution and delivery hereof, the parties
hereto agree as follows:

 

Section 1.                DEFINITIONS. Capitalized terms used in this Amendment and
not defined in this Amendment have the meanings assigned them in the Agreement.

 

Section 2.                AMENDMENT TO SECTION 3.3(a)
OF THE AGREEMENT. Effective
upon the consummation of the Stock Split (at which time 166,667 shares of
Common Stock will be subject to the Agreement), Section 3.3(a) of the Agreement
is amended and restated in its entirety as follows:

 

“(a)                Unvested Shares shall vest in cumulative
increments according to the following schedule: (i) 25% of all Unvested Shares
(i.e., 41,666 shares) shall vest upon the first anniversary of the date of this
Agreement (the “Agreement Anniversary”),
and (ii) 1/36 of the then remaining Unvested Shares (i.e., 3,472 shares) shall
vest on the last day of the first month following the Agreement Anniversary and
monthly thereafter until the last day of the 36th month following the Agreement
Anniversary when all remaining Unvested Shares shall vest. In addition, all
Unvested

 

1

 

Shares
shall immediately vest upon the consummation of any Corporate Transaction that
occurs following the Qualified Financing (other than any Corporate Transaction
entered into in connection with such Qualified Financing).”

 

Section 3.                WAIVER. In connection with the Stock Split, Founder
hereby forfeits any fractional shares to which such Founder may be entitled as
a result of such Stock Split and waives the right to receive payment of the
fair value of such fractional shares in lieu of such fractional shares.

 

Section 4.                NO OTHER CHANGES/PROMISES. Except as specifically set forth in this
Amendment, the terms and provisions of the Agreement shall remain unmodified
and the Agreement is hereby confirmed by the parties as being in full force and
effect as amended herein. This Amendment and the Agreement constitute the
entire understanding of the parties with respect to the subject matter thereof,
and no other covenants have been made by either party to the to the other.

 

Section 5.                COUNTERPARTS. This Amendment may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each
of the parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.

 

[Signature Page Follows]

 

2

 

IN
WITNESS WHEREOF, the parties have caused this Amendment to
the Agreement to be executed and delivered by their respective officers
thereunto duly authorized, all as of the date first above written.

 

	
   

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  DEMARSECO,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Elisabeth DeMarse

  	
   

  
	
   

  	
   

  	
  Elisabeth DeMarse

  	
   

  
	
   

  	
   

  	
  President and Chief
  Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  FOUNDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Elisabeth DeMarse

  	
   

  
	
   

  	
  Elisabeth DeMarse

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

 

SIGNATURE PAGE TO

ELISABETH DEMARSE’S

FIRST AMENDMENT TO FOUNDER STOCK PURCHASE AGREEMENT

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