Document:

Exhibit 4.1

Exhibit 4.1

 Registered

 No. 1

  $[__________]

  CUSIP No: [              
  ]  

J.P. MORGAN CHASE & CO. 

 Capped Quarterly Observation
  Notes Linked to the S&P 500®
  Index due January [ ], 2009 (“Notes”) 

This security is not a deposit or other obligation of a bank and is not insured by the Federal Deposit Insurance Corporation or by any other governmental entity. 

This security is a Registered Global Security within the meaning of the Indenture hereinafter referred to and is registered in the name of Cede & Co., the nominee of The Depository Trust Company (the
“Depositary”). This Registered Global Security is exchangeable for Notes registered in the name of a Person other than the Depositary or its nominee only in the
limited circumstances described in the Indenture, and no transfer of this security (other than a transfer of this security as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary) may be registered except in such limited circumstances. The Depositary will not sell, assign, transfer or otherwise convey any beneficial interest in this Registered Global Security unless such beneficial interest is in an
amount equal to an authorized denomination for the Notes, and the Depositary, by its acceptance hereof, agrees to be so bound. 

Unless this security is presented by an authorized representative of the Depositary to J.P. Morgan Chase & Co. or its agent for registration of transfer, exchange or payment, and any Notes issued are registered in the
name of Cede & Co. or such other name as is requested by an authorized representative of the Depositary (and any payment is made to Cede & Co. or to such other entity as is an authorized representative of the Depositary), any transfer,
pledge or other use hereof for value or otherwise by or to any Person is wrongful since the registered owner hereof, Cede & Co., has an interest herein. 

J.P. Morgan Chase & Co., a corporation duly organized and existing under the laws of the State of Delaware (herein called the “Company,”
which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the amount due upon maturity, as determined in accordance with the
formula set forth under “Payment at Maturity” below, with respect to the principal sum of

 [                                                       ]
  ($__________),  

on January [ ], 2009, on the terms and in the manner described on the reverse hereof. 

Payment at maturity will be made at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time
of payment is legal tender for the payment of public and private debts; provided, however, that at the option of the Company, payment at maturity may be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the security register of the Company. 

Reference is hereby made to the further provisions of this security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. Capitalized terms not
otherwise defined herein shall have their respective meanings in the Indenture. 

Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof, or an Authenticating Agent, by manual signature, this security shall not be entitled to any benefit under
the Indenture or be valid or obligatory for any purpose. 

Payment at Maturity 

This security pays no interest. This security will mature on January [ ], 2009 (the “Maturity Date”). 

 On the Maturity Date the Company shall
  pay a cash payment based on the performance of the S&P 500®
  Index (the “Index”)
  per $1,000 principal amount of securities equal to the greater of:
  (i) $1,100, (the “Minimum Payment Amount”)
  and (ii) $1,000 plus an amount in cash equal to the Additional Amount
  (as defined below).  

The “Additional Amount” will be calculated by the calculation agent by multiplying $1,000 by the sum of the Quarterly Capped Index Returns
for each of the 20 Quarterly Valuation Periods during the term of the securities. 

The “Quarterly Capped Index Return” for any Quarterly Valuation Period, as calculated by the calculation agent on the relevant Period
Valuation Date, is equal to the Index Closing Level at the end of the Quarterly Valuation Period less the Index Closing Level at the beginning of that Quarterly Valuation Period divided by the Index Closing Level at the beginning of that Quarterly
Valuation Period; provided, however, that in no event will the Quarterly Capped Index Return for any
Quarterly Valuation Period exceed .05 (or 5%). 

Each “Quarterly Valuation Period” is the period from and including a Period Valuation Date to and including the immediately subsequent
Period Valuation Date; except that the first Quarterly Valuation Period begins on December 12, 2003. The first Quarterly Valuation Period will be greater than one calendar quarter. 

The “Period Valuation Dates” are the [ ]th of each January, April, July and October, beginning April 2004 through October 2008 and the final
Period Valuation Date is January [ ], 2009, in each such case subject to adjustment if such date is not a Trading Day or if a Market Disruption Event occurs on such date as described in the two following paragraphs. 

If any scheduled Period Valuation Date occurring from and including April 2004 to and including October 2008 is not a Trading Day or if a Market Disruption Event occurs on any such date, such Period Valuation Date will be
the immediately succeeding Trading Day during which no Market Disruption Event shall have occurred; provided that if a Market Disruption Event occurs on any of the scheduled
Period Valuation Dates occurring from and including April 2004 to and including October 2008 and on each of the five Trading Days immediately succeeding that scheduled Period Valuation Date, then (i) such fifth Trading Day will be deemed to be the
relevant Period Valuation Date, notwithstanding the occurrence of a Market Disruption Event on such day and (ii) with respect to any such fifth Trading Day on which a Market Disruption Event occurs, the calculation agent will determine the Index
Closing Level on such fifth Trading Day in accordance with the formula for and method of calculating the Index Closing Level last in effect prior to the commencement of the Market Disruption Event, using the closing price (or, if trading in the
relevant securities has been materially suspended or materially limited, its good faith estimate of the closing price that would have prevailed but for such suspension or limitation) on such Trading Day of each security most recently comprising the
Index. 

 If January [  ], 2009 (the
  final Period Valuation Date) is not a Trading Day or if there is
  a Market Disruption Event on such day, the final Period Valuation
  Date will be the immediately succeeding Trading Day during which
  no Market Disruption Event shall have occurred; provided
  that the Index Closing Level will not be determined on a date later
  than the second scheduled Trading Day prior to maturity, and if such
  day is not a Trading Day, or if there is a Market Disruption Event
  on such date, the calculation agent will determine the Index Closing
  Level on such date in accordance with the formula for and method
  of calculating the Index Closing Level last in effect prior to commencement
  of the Market Disruption Event (or prior to the non-Trading Day),
  using the closing price (or, if trading in the relevant securities
  has been materially suspended or materially limited, its good faith
  estimate of the closing price that would have prevailed but for such
  suspension or limitation or non-Trading Day) on such date of each
  security most recently constituting the Index.  

The “Index Closing Level” on any Trading Day will equal the closing level of the Index or any Successor Index (as defined below) at the
regular official weekday close of the principal trading session of the New York Stock Exchange, Inc. (the “NYSE”), the American Stock Exchange LLC (the
“AMEX”), the Nasdaq National Market or the Relevant Exchange or market for the Successor Index. 

A “Trading Day” is a day, as determined by the calculation agent, on which trading is generally conducted on the NYSE, the AMEX, the Nasdaq
National Market, the Chicago Mercantile Exchange and the Chicago Board Options Exchange and in the over-the-counter market for equity securities in the United States. 

The Company will irrevocably deposit with DTC no later than the close of business on the Maturity Date funds sufficient to make payments of the amount payable at maturity with respect to the Notes on such date. The Company
will give DTC irrevocable instructions and authority to pay such amount to the Holders of the Notes entitled thereto. In the event that the Maturity Date is not a Business Day, then payments payable on such date will be made on the next succeeding
Business Day with the same force and effect as if made on such date, except that, if such Business Day falls in the next calendar year such payment will be made on the immediately preceding Business Day. A “Business Day” is any day other than a day on which banking institutions in The City of New York are authorized or required by law or regulation to close or a day on which transactions in dollars
are not conducted. 

Calculation Agent 

J.P. Morgan Securities Inc. will act as the calculation agent. The calculation agent will determine the Index Closing Level on each Period Valuation Date, each Quarterly Capped Index Return and the Additional Amount of
cash, if any, the Company will pay Holders at maturity of the Notes. In addition, the calculation agent will determine whether there has been a Market Disruption Event or a discontinuance of the Index and whether there has been a material change in
the method of calculating the Index. All determinations made by the calculation agent will be at the sole discretion of the calculation agent and will, in the absence of manifest error, be conclusive for all purposes and binding on Holders and on
the Company. The Company may appoint a different calculation agent from time to time after the date of this prospectus supplement without the Holders’ consent and without notifying Holders. 

The calculation agent will calculate the Additional Amount on the final Period Valuation Date. The calculation agent will provide written notice to the Trustee at its New York office, on which notice the Trustee may
conclusively rely, of the Additional Amount on or prior to 11:00 a.m. on the Business Day preceding the Maturity Date. 

All calculations with respect to the Quarterly Capped Index Return or the Index Closing Level will be rounded to the nearest one hundred-thousandth, with five one-millionths rounded upward (e.g., .876545 would be rounded to
..87655); all dollar amounts related to determination of the Additional Amount payable per Note will be rounded to the nearest ten-thousandth, with five one hundred-thousandths rounded upward (e.g., .76545 would be rounded up to .7655); and all
dollar amounts paid on the aggregate number of notes will be rounded to the nearest cent, with one-half cent rounded upward. 

Market Disruption Events 

 With respect to the Index, a “Market
  Disruption Event” means:

	(i)(a)	 a suspension, absence
      or material limitation of trading of stocks then constituting
      20 percent or more of the level of the Index (or the relevant
      Successor Index) on the Relevant Exchanges (as defined below)
      for such securities for more than two hours of trading or during
      the one hour period preceding the close of the principal trading
      session on such Relevant Exchange; or
	 	 
	(b)	  a breakdown or failure in the price
      and trade reporting systems of any Relevant Exchange as a result
      of which the reported trading prices for stocks then constituting
      20 percent or more of the level of the Index (or the relevant
      Successor Index) during the last one hour preceding the close
      of the principal trading session on such Relevant Exchange are
      materially inaccurate; or  
	 	 
	(c)	  the suspension, absence or material
      limitation of trading on any major U.S. securities market for
      trading in futures or options contracts related to the Index
      (or the relevant Successor Index) for more than two hours of
      trading or during the one hour period preceding the close of
      the principal trading session on such market, in each case as
      determined by the calculation agent in its sole discretion; and
       

	(ii)	 a determination by the
      calculation agent in its sole discretion that the event described
      above materially interfered with its ability or the ability of
      any of our affiliates to adjust or unwind all or a material portion
      of any hedge with respect to the Notes.  

For the purpose of determining whether
  a Market Disruption Event exists at any time, if trading in a security
  included in the Index is materially suspended or materially limited
  at that time, then the relevant percentage contribution of that security
  to the level of the Index shall be based on a comparison of:

	(i)	 the portion of the level
      of the Index attributable to that security relative to 
    
	 	 
	(ii)	  the overall level of the Index,
      in each case immediately before that suspension or limitation.
    

For purposes of determining whether a
  Market Disruption Event has occurred:

	(i) 	a limitation on the hours
      or number of days of trading will not constitute a Market Disruption
      Event if it results from an announced change in the regular business
      hours of the Relevant Exchange or market;  
	 	 
	(ii)	  a decision to permanently discontinue
      trading in the relevant futures or options contract will not
      constitute a Market Disruption Event;  
	 	 
	(iii)	 limitations pursuant to the rules
      of any Relevant Exchange similar to NYSE Rule 80A (or any applicable
      rule or regulation enacted or promulgated by any other self-regulatory
      organization or any government agency of scope similar to NYSE
      Rule 80A as determined by the calculation agent) on trading during
      significant market fluctuations will constitute a suspension,
      absence or material limitation of trading; 
	 	 
	(iv)	 a suspension of trading in futures
      or options contracts on the Index by the primary securities market
      trading in such contracts by reason of  

	 	 	 
	 	(a)	a price change exceeding
      limits set by such exchange or market,
	 	 	 
	 	(b)	an imbalance of orders relating to
      such contracts, or 
	 	 	 
	 	(c)	  a disparity in bid and ask quotes
      relating to such contracts 

	 	 
	 	  will, in each such
      case, constitute a suspension, absence or material limitation
      of trading in futures or options contracts related to the Index;
      and  
	 	 
	(v)	 a “suspension, absence or material
      limitation of trading” on any Relevant Exchange or on the
      primary market on which futures or options contracts related
      to the Index are traded will not include any time when such market
      is itself closed for trading under ordinary circumstances. 
    

“Relevant
  Exchange” means the primary
  U.S. organized exchange or market of trading for any security (or
  any combination thereof) then included in the Index or any Successor
  Index.  

Discontinuance of the S&P 500 Index; Alteration of Method of Calculation 

If Standard & Poor’s, a division of McGraw-Hill Companies, Inc. (“S&P”) discontinues publication of the Index and S&P or
another entity publishes a successor or substitute index that the calculation agent determines, in its sole discretion, to be comparable to the discontinued Index (such index being referred to herein as a “Successor Index”), then any Index Closing Level will be determined by reference to the level of such Successor Index at the close of trading on the NYSE, the AMEX, the Nasdaq National Market or
the Relevant Exchange or market for the Successor Index on the relevant Period Valuation Date. 

Upon any selection by the calculation agent of a Successor Index, the calculation agent will cause written notice thereof to be promptly furnished to the Trustee, to the Company and to the Holders of the Notes. 

 If S&P discontinues publication of
  the Index prior to, and such discontinuance is continuing on, any
  Period Valuation Date and the calculation agent determines, in its
  sole discretion, that no Successor Index is available at 
  

  

such time, then the calculation agent will determine the Index Closing Level for such date. The Index Closing Level will be computed by the calculation agent in accordance with the formula for and method of calculating the
Index last in effect prior to such discontinuance, using the closing price (or, if trading in the relevant securities has been materially suspended or materially limited, its good faith estimate of the closing price that would have prevailed but for
such suspension or limitation) at the close of the principal trading session on such date of each security most recently comprising the Index. Notwithstanding these alternative arrangements, discontinuance of the publication of the Index on the
Relevant Exchange may adversely affect the value of the Notes. 

If at any time the method of calculating the Index or a Successor Index, or the level thereof, is changed in a material respect, or if the Index or a Successor Index is in any other way modified so that such index does not,
in the opinion of the calculation agent, fairly represent the level of the Index or such Successor Index had such changes or modifications not been made, then, from and after such time, the calculation agent will, at the close of business in New
York City on each date on which the Index Closing Level is to be determined, make such calculations and adjustments as, in the good faith judgment of the calculation agent, may be necessary in order to arrive at a level of a stock index comparable
to the Index or such Successor Index, as the case may be, as if such changes or modifications had not been made, and the calculation agent will calculate the Index Closing Level with reference to the Index or such Successor Index, as adjusted.
Accordingly, if the method of calculating the Index or a Successor Index is modified so that the level of such index is a fraction of what it would have been if it had not been modified (e.g., due to a split in the index), then the calculation agent will adjust such index in order to arrive at a level of the Index or such Successor Index as if it had not been modified (e.g., as if such split had not occurred). 

Events of Default 

Events of Default relating to the Notes are set forth in Section 5.01 of the Indenture. 

Alternate Additional Amount Calculation in Case of an Event of Default

In case an Event of Default with respect to the Notes shall have occurred and be continuing, the amount declared due and payable for each note upon any acceleration of the Notes will be equal to $1,100 or $1,000 plus the
Additional Amount determined as though the Index Closing Level for any Period Valuation Date scheduled to occur after such date of acceleration were the Index Closing Level on the date of acceleration. Therefore, the Quarterly Capped Index Return
for the then current Quarterly Valuation Period would be equal to the Index Closing Level on the date of acceleration less the Index Closing Level at the beginning of that Quarterly Valuation Period divided by the Index Closing Level at the
beginning of such Quarterly Valuation Period, and the Quarterly Capped Index Return for each remaining Quarterly Valuation Period would be equal to zero. 

Defeasance 

 The Notes will not be subject to the
  defeasance provisions contained in Article 13 of the Indenture.

  

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal

 Date: December __, 2003  

  	J.P. MORGAN CHASE &
        CO.  
	 	 	 
	By:	 	 
	 	

	 	Name:	 
	 	Title:	 
	 	 	 
	Attest:	 	 
	 	

	 	Name:	 
	 	Title:	 

 [Seal]

  	TRUSTEE’S CERTIFICATE
        OF AUTHENTICATION
	 	 	 
	This is one of the
        Securities referred to in the within-mentioned Indenture.
	 	 	 
	 	DEUTSCHE BANK TRUST
        COMPANY AMERICA

        (f/k/a/ Bankers Trust Company),

        As Trustee
	 	 	 
	 	BY: JPMORGAN CHASE
        BANK

        As Authenticating Agent 
	 	 	 
	By:	 	 
	 	

	 	Name:	 
	 	Title:	 

[REVERSE OF SECURITY] 

 Capped Quarterly Observation
  Notes Linked to the S&P 500®
  Index due January [  ], 2009  

 This security is one of a duly authorized
  issue of securities of the Company (herein called the “Notes”),
  issued and to be issued in one or more series under an Indenture
  dated as of May 25, 2001, (the “Indenture”),
  between the Company and Deutsche Bank Trust Company Americas (f/k/a
  Bankers Trust Company) (herein called the “Trustee,”
  which term includes any successor trustee under the Indenture), to
  which Indenture reference is hereby made for a statement of the respective
  rights, limitations of rights, duties and immunities thereunder of
  the Company, the Trustee, and the Holders and of the terms upon which
  the Notes are, and are to be, authenticated and delivered. This security
  is one of the series designated as the Capped Quarterly Observation
  Notes Linked to the S&P 500®
  Index due January [ ], 2009 of the Company, which series shall have
  an aggregate principal amount of $[__________].  

The Notes are not redeemable at the option of the Company prior to maturity and are not subject to any sinking fund. 

If an Event of Default specified under the Indenture with respect to the Notes shall occur and be continuing, the Notes may be declared due and payable in the manner and with the effect provided in the Indenture and on the
face hereof and the calculation agent will determine the Additional Amount in accordance with the calculation set forth under “Alternate Additional Amount Calculation in Case of an Event of Default” on the face hereof. Upon payment of the
amount so declared due and payable, all of the Company’s obligations in respect of the payment due at maturity on the Notes shall terminate. 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the securities of each series to
be affected under the Indenture at any time by the Company and the Trustee with the consent of the holders of a majority in aggregate principal amount of the securities at the time outstanding of each series to be affected. The Indenture also
contains provisions permitting the Holders of specified percentages in aggregate principal amount of the securities of each series at the time Outstanding, on behalf of the Holders of all securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this security shall be conclusive and binding upon such Holder and upon all future Holders of
this security and of any Notes issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this security. 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this security is registrable in the security register of the Company, upon surrender of this security for registration of
transfer in any place where the amount due at maturity of this security is payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the security registrar duly executed by, the Holder
hereof or his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. 

The Notes are issuable only in registered form without coupons in denominations of $1,000 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Notes are
exchangeable for a like aggregate principal amount of Notes of like tenor of a different authorized denomination, as requested by the Holder surrendering the same. 

No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

Prior to due presentment of this security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this security is registered as the owner hereof
and for all purposes, whether or not this security shall be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary. 

No recourse for the payment of amounts due at maturity of this security or for any claim based hereon or otherwise in respect hereof, and no recourse under or upon any obligation, covenant or agreement of the Company in the
Indenture or any indenture supplemental thereto or in this security, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, past, present or future, of
the Company or of any successor corporation, either directly or through the Company, or any successor corporation, whether by virtue of any constitution, statute or rule of law or by the enforcement of any assessment or penalty or otherwise, all
such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released by each Holder of this security. 

Capitalized terms not otherwise defined herein shall have their respective meanings in the Indenture. 

This security shall be governed by and construed in accordance with the laws of the State of New York.exv4w1

 

Exhibit 4.1

INTERSECTIONS INC.

INVESTORS’ RIGHTS AGREEMENT

     This INVESTORS’ RIGHTS AGREEMENT (this “Agreement”) entered into as
of November      , 2001, by and among INTERSECTIONS INC., a Delaware corporation
(the “Company”), the holders of the Company’s Common Stock, Series A
Preferred Stock, Series B Preferred Stock and Series C Preferred Stock listed
on Exhibit A hereto (the “Existing Investors”), and CD HOLDINGS
INC., a Georgia corporation (“EFX” and together with the Existing
Investors, the “Investors”).

W I T N E S S E T H:

     WHEREAS, the Company, Conning Capital Partners V, L.P., a Delaware limited
partnership (“Conning”), and certain other holders of the Company’s
Series C Preferred Stock (together with Conning, the “Series C
Stockholders”) are parties to a Series C Preferred Stock Purchase Agreement
dated as of January 7, 2001, as amended (the “Series C Purchase
Agreement”), pursuant to which the Company granted the Series C
Stockholders certain rights with respect to shares of Series C Preferred Stock
issued to the Series C Stockholders;

     WHEREAS, the Company and Loeb Holding Corporation, a Maryland corporation
(“Loeb”) are parties to a Registration Rights Agreement dated as of
January 10, 2001, as amended (the “Registration Rights Agreement”),
pursuant to which the Company granted to Loeb and certain other Existing
Investors certain registration rights with respect to shares of the Company’s
capital stock owned by Loeb and such other Existing Investors;

     WHEREAS, the Company and EFX have entered into a Note Purchase Agreement
(the “Purchase Agreement”) of even date herewith pursuant to which the
Company and CreditComm Services LLC, a Delaware limited liability company and
wholly-owned subsidiary of the Company (“CreditComm”), desire to sell to
EFX and EFX desires to purchase from the Company and CreditComm, a single
senior secured note in the original stated principal amount of $20,000,000
which is convertible into shares of the Company’s Series D Preferred Stock on
the terms and subject to the conditions set forth therein (the “Note”);

     WHEREAS, a condition to EFX’s obligations under the Purchase Agreement is
that the Company and the Existing Investors enter into this Agreement in order
to, among other things, terminate certain of their respective rights under the
Series C Purchase Agreement and the Registration Rights Agreement, and provide
EFX with (i) certain rights to register shares of the Company’s Common Stock
issuable upon conversion of the Series D Preferred Stock issuable upon
conversion of the Note, (ii) certain rights to receive or inspect information
pertaining to the Company, and (iii) a right of first offer with respect to
certain issuances by the Company of its securities; and

     WHEREAS, the Company and the Existing Investors each desire to induce EFX
to purchase the Note pursuant to the Purchase Agreement by agreeing to the
terms and conditions set forth herein;

 

 

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

     1.     Definitions and Accounting Terms.

          1.1. Certain Definitions. As used in this Agreement, the following
terms shall have the following respective meanings:

               "Acquisition”
shall mean any transaction pursuant to which the
Company or any Subsidiary (a) acquires Equity Securities of any Person, (b)
causes or permits any person to be merged into the Company or any Subsidiary,
in any case pursuant to a merger, purchase of assets or any reorganization
providing for the delivery or issuance to the holders of such Person’s then
outstanding securities, in exchange for such securities, of cash or securities
of the Company or any Subsidiary, or a combination thereof, or (c) purchases
all or substantially all of the business or assets of any Person.

               "Affiliate” shall mean, with respect to any Person, (a) each Person
that, directly or indirectly, owns or controls, whether beneficially, or as a
trustee, guardian or other fiduciary, five percent (5%) or more of the Stock
having ordinary voting power in the election of directors of such Persons, (b)
each Person that controls, is controlled by or is under common control with
such Person, (c) each of such Person’s officers, directors, joint venturers and
partners and (d) in the case of the Company, the immediate family members,
spouses and lineal descendants of individuals who are Affiliates of the
Company. For the purposes of this definition, “control” of a Person shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of its management or policies, whether through the ownership of
voting securities, by contract or otherwise; provided, however,
that the term “Affiliate” shall specifically exclude EFX and Conning.

               "Agreement” shall mean this Investors’ Rights Agreement, including
all amendments, modifications or supplements thereto.

               "Applicable Conversion Value” shall have the meaning assigned to
such term in the Certificate of Incorporation.

               "Board of Directors” shall mean the Board of Directors of the
Company, as constituted from time to time.

               "By-Laws” shall mean the By-Laws of the Company, including all
amendments.

               "Certificate of Incorporation” shall mean the Restated Certificate
of Incorporation of the Company, as amended, modified or supplemented from time
to time.

               "Closing Date” shall have the meaning ascribed to such term in the
Purchase Agreement.

-2-

 

               "Code” shall mean the Internal Revenue Code of 1986, as amended.

               "Commission” shall mean the Securities and Exchange Commission or
any other federal agency then administering the Securities Act or Exchange Act.

               "Common Stock” shall mean (i) the Common Stock, $.01 par value, of
the Company, (ii) any other capital stock of any class or classes (however
designated) of the Company, authorized on or after the date hereof, the holders
of which shall have the right, without limitation as to amount, either to all
or to a share of the balance of current dividends and liquidating dividends
after the payment of dividends and distributions on any shares entitled to
preference, and the holders of which shall ordinarily, in the absence of
contingencies or in the absence of any provision to the contrary in the
Company’s certificate of incorporation, be entitled to vote for the election of
a majority of directors of the Company (even though the right so to vote has
been suspended by the happening of such a contingency or provision), and (iii)
any other securities into which or for which any of the securities described in
(i) or (ii) may be converted or exchanged pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or otherwise.

               "Company” shall have the meaning assigned to such term in the
introductory sentence hereof.

               "Demand Registration” shall mean and include an EFX Demand
Registration, a Series C Demand Registration, and a Loeb Demand Registration.

               "Default” shall mean any event which, with the passage of time or
notice or both, would, unless cured or waived, become an Event of Default.

               "Distribution” shall mean, with respect to any Person, the
declaration or payment of any dividends by such Person, or the purchase,
redemption, retirement or other acquisition for value of any of its capital
stock or other Equity Securities (including warrants, options and other rights
to acquire capital stock or other Equity Securities) now or hereafter
outstanding, or the making of any distribution of assets to its stockholders as
such whether in cash, assets or in obligations of such Person, or the
allocation or other setting apart of any sum for the payment of any dividend or
distribution on, or for the purchase, redemption or retirement of any shares of
its capital stock or other Equity Securities, or the making of any other
distribution by reduction of capital or otherwise in respect of any shares of
its capital stock or other Equity Securities.

               "Effective” shall mean that all requirements under the Securities
Act with respect to a Registration Statement have been satisfied and that the
Commission has officially approved the public distribution or circulation of
the Registration Statement in connection with a public offering of Registrable
Securities.

               "Effective Date” shall mean the date on which a Registration
Statement is declared to be Effective.

               "Equity Securities” shall mean, with respect to any Person, (i)
shares of common stock, partnership interests or membership interests of such
Person, (ii) any other equity

-3-

 

security of such Person, including, without
limitation, shares of preferred stock, (iii) any equity-linked securities
including, without limitation, stock appreciation rights, “phantom” stock
rights or rights to payment based on the performance (e.g. revenues, EBITDA,
earnings, etc.) of such Person, (iv) any notes or debt securities of such
Person containing equity features (including any notes or debt securities
convertible into or exchangeable for equity securities, issued in connection
with the issuance of equity securities or containing profit participation
features) or (v) any right, option or warrant to acquire any such equity
security or any such note or debt security.

               "Event of Default” shall have the meaning assigned to it in Section
8.1 of the Purchase Agreement.

               "Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated pursuant thereto.

               "Fiscal Quarter” shall mean any of the quarterly accounting periods
of the Company and its Subsidiaries.

               "GAAP” shall mean generally accepted accounting principles as set
forth from time to time in the opinions of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements of the
Financial Accounting Standards Board or in such opinions and statements of such
other entities as shall be approved by a significant segment of the accounting
profession.

               "Holder” means any Person owning or having the right to acquire
Registrable Securities or any assignee thereof in accordance with Section 2.8
of this Agreement.

               "Indebtedness” of any Person shall mean without duplication (a) all
indebtedness of such Person for borrowed money or for the deferred purchase
price of property payment for which is deferred six (6) months or more, but
excluding obligations to trade purchasers incurred in the ordinary course of
business that are not overdue by more than six (6) months unless being
contested in good faith, (b) all reimbursement and other obligations with
respect to letters of credit, bankers’ acceptances and surety bonds, whether or
not matured, (c) all obligations evidenced by notes, bonds, debentures or
similar instruments, (d) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of such property), (e) all Capital Lease Obligations (as such term is
defined in the Purchase Agreement), (f) all obligations of such Person under
commodity purchase or option agreements or other commodity price hedging
arrangements, in each case whether contingent or matured, (g) all obligations
of such Person under any foreign exchange contract, currency swap agreement,
interest rate swap, cap or collar agreement or other similar agreement or
arrangement designed to alter the risks of that Person arising from
fluctuations in currency values or interest rates, in each case whether
contingent or matured, (h) all Indebtedness referred to above secured by (or
for which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property or other assets
(including accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Indebtedness,
and (i) the Obligations.

-4-

 

               "Initial Public Offering” shall mean the first offering for sale of
Common Stock for the account of the Company or for the account of any Holder
pursuant to an Effective Registration Statement.

               "Inspectors” shall have the meaning given such term in Section
2.5(i).

               "Key Employee” shall have the meaning given such term in the
Purchase Agreement.

               "Material Adverse Effect” shall have the meaning assigned to such
term in the Purchase Agreement.

               "NASD” shall mean the National Association of Securities Dealers,
Inc.

               "NASDAQ” shall mean the National Association of Securities Dealers
Automated Quotations System.

               "Obligations” shall have the meaning assigned to such term in the
Purchase Agreement.

               "Offer” shall have the meaning assigned to such term in Section
3.3(a).

               "Offeree” shall have the meaning assigned to such term in Section
3.3(a).

               "Offer Notice” shall have the meaning assigned to such term in
Section 3.3(a).

               "Offered Securities” shall have the meaning assigned to that term
in Section 3.3(a).

               "Permitted Equity Issuance” shall have the meaning assigned to such
term in the Purchase Agreement.

               "Permitted Secured Indebtedness” shall have the meaning assigned to
such term in the Purchase Agreement.

               "Person” shall mean any individual, sole proprietorship,
partnership, joint venture, trust, unincorporated organization, association,
corporation, limited liability company, institution, public benefit
corporation, other entity or government (whether federal, state, county, city,
municipal, local, foreign, or otherwise, including any instrumentality,
division, agency, body or department thereof).

               "PORTAL” shall have the meaning assigned to such term in Section
3.1(l).

               "Proprietary Rights” shall mean all of the following along with all
income, royalties, damages and payments thereon (including damages and payments
for past or future infringements or misappropriations thereof), the rights to
sue and recover for past

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infringements and misappropriations thereof and any
and all corresponding rights that, now or hereafter, may be secured throughout
the world: (a) patents, patent applications, patent disclosures and inventions
(whether or not patentable and whether or not reduced to practice) and any
reissues, continuations, continuations-in-part, revisions, extensions or
reexaminations thereof; (b) trademarks, service marks, trade dress, trade
names, domain names, corporate names and registrations, renewals and
applications for registration thereof, together with the goodwill associated
therewith; (c) copyrights and copyrightable works and registrations, renewals
and applications for registration thereof; (d) mask works and registrations and
applications for registration thereof; (e) computer software (including all
source and object code, databases, data and documentation); (f) trade secrets
and other confidential information (including ideas, formulas, compositions,
inventions, know-how, manufacturing and production processes and techniques,
research and development information, drawings, specifications, designs, plans,
proposals. technical data, copyrightable works, financial and marketing plans
and customer and supplier lists and information), (g) other intellectual
property rights; and (h) copies and tangible embodiments thereof (in whatever
form or medium).

               "Pro Rata” shall mean, at any date of determination thereof, the
number of shares of Common Stock held by a holder thereof (determined on an “as
if converted” basis) divided by the sum of the number of outstanding shares of
Common Stock plus the number of shares of Common Stock issuable upon exercise
of all outstanding vested rights, options or warrants or convertible or
exchangeable securities.

               "Qualified Holder” shall mean (i) each holder of at least 1,500
shares of Common Stock issued or issuable upon conversion of Series D Shares
issued or held by such holder, and (ii) each holder of at least 700 shares of
Common Stock issued or issuable upon conversion of Series C Preferred Stock
issued or held by such holder, which numbers shall be subject to equitable
adjustment whenever there shall occur a stock dividend, stock split,
combination, reorganization, recapitalization, reclassification or other
similar event.

               "Qualified Public Offering” shall have the meaning ascribed to such
term in Section (B)(4)(b)(i) of Article Fourth of the Certificate of
Incorporation.

               "Records” shall have the meaning assigned to that term in Section
2.5(i).

               "Registrable Securities” shall mean (a) the shares of Common Stock
owned by Loeb and the Stockholders, (b) the shares of Common Stock issued or
issuable upon conversion of the Series A Preferred Stock, Series B Preferred
Stock, and Series C Preferred Stock, (c) shares of Common Stock issuable or
issued upon conversion of the shares of Series D Preferred Stock issued or
issuable upon conversion of the Note, and (d) any shares of capital stock of
the Company acquired after the date hereof by the Investors, including shares
of Common Stock issuable on the conversion of other securities or the exercise
of options acquired by any Investor pursuant to Section 3.3 or otherwise;
provided, however, that such securities shall cease to be Registrable
Securities if and when (w) a Registration Statement with respect to the
disposition of such securities shall have become Effective under the Securities
Act and such securities shall have been disposed of pursuant to such Effective
Registration Statement, (x) such securities shall have been otherwise
transferred, if new certificates or other evidences of ownership for such
securities not bearing a legend restricting further transfer and not subject to

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any stop transfer order or other restrictions on transfer shall have been
delivered by the Company, and subsequent disposition of such securities shall
not require Registration or qualification of such securities under the
Securities Act, or (y) such securities shall have ceased to be outstanding or
(z) such securities may be sold without any volume limits under Rule 144.

               "Registration” shall mean the satisfaction by the Company of all
applicable requirements under the Securities Act as evidenced by the official
approval of the Commission in connection with a public offering by the Company
of Registrable Securities.

               "Registration Expenses” shall mean all expenses incident to the
Company’s performance of or compliance with its obligations under this
Agreement, including, without limitation, all Commission and stock exchange or
NASD registration and filing fees and expenses, fees and expenses of compliance
with applicable state securities or “blue sky” laws (including, without
limitation, reasonable fees and disbursements of counsel for the underwriters
in connection with “blue sky” qualifications of the Registrable Securities),
printing expenses, messenger and delivery expenses, the fees and expenses
incurred in connection with the listing of the securities to be registered in a
public offering on each securities exchange or national market system on which
such securities are to be so listed and, following such initial public
offering, the fees and expenses incurred in connection with the listing of such
securities to be registered on each securities exchange or national market
system on which such securities are listed, fees and disbursements of counsel
for the Company and all independent certified public accountants (including the
expenses of any annual audit and “cold comfort” letters required by or incident
to such performance and compliance), the fees and disbursements of underwriters
customarily paid by issuers or sellers of securities (including the fees and
expenses of any “qualified independent underwriter” required by the NASD), the
fees of one counsel retained in connection with each such Registration by the
holders of the Registrable Securities being registered, the reasonable fees and
expenses of any special experts retained by the Company in connection with such
Registration, and fees and expenses of other Persons retained by the Company;
provided, however, that Registration Expenses shall exclude all underwriting
discounts, selling commissions and transfer taxes applicable to the sale of
Registrable Securities.

               "Registration Statement” shall mean any disclosure document that
the Company is required to file under the Securities Act in connection with a
public offering of Registrable Securities.

               "Related Agreements” shall mean the Certificate of Incorporation
and the Stockholders Agreement, including all amendments, modifications or
supplements thereto.

               "Requisite Series C Holders” shall mean holders of at least a
majority of the Common Stock issued or issuable upon conversion of the Series C
Preferred Stock.

               "Requisite Series D Holders” shall mean holders of at least a
majority of the Common Stock issued or issuable upon conversion of the Series D
Shares.

               "Rule 144A Information” shall have the meaning assigned to such
term in Section 3.1(l).

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               "Securities Act” shall mean the Securities Act of 1933, as amended
from time to time or any other federal act, rule or regulation requiring
Registration with any federal agency in connection with a public offering of
Registrable Securities.

               "Series D Shares” shall mean and include all shares of Series D
Preferred Stock now owned or hereafter acquired by any of the Investors, and
any shares of capital stock of the Company or another entity that may be issued
in exchange for or in respect of any such shares of Series D Preferred Stock
(whether pursuant to a stock split, stock dividend, combination,
reclassification, reorganization, or any other means), and any right or
instrument that contains any feature, conditional or otherwise, whereby any
shares of such capital stock may be obtained; provided, however, for the
purposes of any computation of the number of Series D Shares pursuant to this
Agreement, any such right or instrument shall be deemed converted, exercised or
exchanged as applicable, and the shares of Series D Preferred Stock issuable
upon such conversion, exercise or exchange shall be deemed outstanding,
regardless of whether such conversion, exercise or exchange has actually been
effected.

               "Stockholders” shall mean the stockholders of the Company listed on
Schedule A attached hereto.

               "Stockholders’ Agreement” shall mean the Amended and Restated
Stockholders’ Agreement, dated as of November      , 2001, among the Company and
the parties thereto, including all amendments, modifications or supplements
thereto.

               "Subsidiary” shall mean, with respect to any Person, (a) any
corporation or other entity of which an aggregate of more than fifty percent
(50%) of the outstanding Stock having ordinary voting power to elect a majority
of the board of directors (or comparable governing body) of such entity
(irrespective of whether, at the time, Stock of any other class or classes of
such entity shall have or might have voting power by reason of the happening of
any contingency) is at the time, directly or indirectly, owned legally or
beneficially by such Person and/or one or more Subsidiaries of such Person, or
with respect to which any such Person has the right to vote or designate the
vote of fifty percent (50%) or more of such Stock whether by proxy, agreement,
operation of law or otherwise, and (b) any partnership or limited liability
company in which such Person and/or one or more Subsidiaries of such Person
shall have an interest (whether in the form of voting or participation in
profits or capital contribution) of more than fifty percent (50%) or of which
any such Person is a general partner or may exercise the powers of a general
partner, and includes, without limitation, CreditComm or its other
Subsidiaries.

               "Termination Date” shall have the meaning assigned to such term in
the Purchase Agreement.

               "Wholly-Owned Subsidiary” shall mean any such corporation or entity
of which all of such securities or other ownership interests are so owned
directly or indirectly by the Company or any of its other Wholly-Owned
Subsidiaries.

          1.2. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP consistently applied,
and all financial data

-8-

 

submitted pursuant to this Agreement, unless otherwise
specified, shall be prepared in accordance with GAAP.

     2.     Registration Rights. The Company and the Investors covenant and
agree as follows:

          2.1. Demand Registrations.

               (a)  Initiating Holders.

                    (i)  Series D Stockholders. At any time and from time to time after
the third anniversary of the Closing Date and prior to five years from the date
of the Initial Public Offering, upon the written request of the Requisite
Series D Holders that the Company effect the Registration under the Securities
Act (such a written request being hereinafter referred to as a “Series D
Demand Registration Request”) of any of its Registrable Securities, the
Company will promptly give written notice to all other Holders that a Series D
Demand Registration Request has been received, and the number of Registrable
Securities to be registered. Thereupon, the Company will use its reasonable
best efforts to cause the prompt Registration under the Securities Act, subject
to the provisions of this Agreement, of all Registrable Securities which the
Requisite Series D Holders requested the Company to register (a “Series D
Demand Registration”), and in connection therewith, prepare and file on
such appropriate form as the Company, in its reasonable discretion, shall
determine, a Registration Statement under the Securities Act to effect such
Registration. The Holders initializing the Series D Demand Registration (the
“Series D Initializing Holders”) may, at any time prior to the Effective
Date of the Registration Statement relating to such Registration, revoke such
request, without liability to any of the other Holders, by providing a written
notice to the Company revoking such request; provided, however, that this shall
still count as a Demand Registration unless the Series D Initializing Holders
pay all Registration Expenses in connection with such Registration.

                    (ii)  Series C Stockholders. At any time and from time to time
subsequent to 180 days after the date of and prior to five years from the date
of the Initial Public Offering, upon the written request of the Requisite
Series C Holders that the Company effect the Registration under the Securities
Act (such a written request being hereinafter referred to as a “Series C
Demand Registration Request”) of any of the Registrable Securities held by
the Series C Stockholders, the Company will promptly give written notice to all
other Holders that a Series C Demand Registration has been received. For a
period of 15 days following delivery of such notice, the other Holders may
request that the Company also register their Registrable Securities and after
the expiration of such 15 day period, the Company shall notify all Holders of
the number of Registrable Securities to be registered. Thereupon, the Company
will use its reasonable best efforts to cause the prompt Registration under the
Securities Act, subject to the provisions of this Agreement, of all Registrable
Securities which the Holders thereof have requested the Company to register (a
“Series C Demand Registration”), and in connection therewith, prepare
and file on such appropriate form as the Company, in its reasonable discretion,
shall determine, a Registration Statement under the Securities Act to effect
such Registration. The Holders initiating the Series C Demand Registration
(the “Series C Initiating Holders”) may, at any time prior to the
Effective Date of the Registration Statement relating to

-9-

 

such Registration,
revoke such request, without liability to any of the other Holders, by
providing a written notice to the Company revoking such request; provided,
however, that this shall still count as a Demand Registration unless the Series
C Initiating Holders pay all Registration Expenses in connection with such
Registration.

                    (iii)  Loeb. At any time and from time to time subsequent to 180
days after the date of and prior to five years from the date of the Initial
Public Offering, upon the written request of Loeb that the Company effect the
Registration under the Securities Act (such a written request being hereinafter
referred to as a “Loeb Demand Registration Request”) of any of the
Registrable Securities held by Loeb, the Company will promptly give written
notice to the Holders that a Loeb Demand Registration has been received. For a
period of 15 days following delivery of such notice, the Holders may request
that the Company also register their Registrable Securities and after the
expiration of such 15 day period, the Company shall notify all Holders of the
number of Registrable Securities to be registered. Thereupon, the Company will
use its reasonable best efforts to cause the prompt Registration under the
Securities Act, subject to the provisions of this Agreement, of all Registrable
Securities which the Holders thereof have requested the Company to register (a
“Loeb Demand Registration”), and in connection therewith, prepare and
file on such appropriate form as the Company, in its reasonable discretion,
shall determine, a Registration Statement under the Securities Act to effect
such Registration. Loeb may, at any time prior to the Effective Date of the
Registration Statement relating to such Registration, revoke such request,
without liability to any of the other Holders, by providing a written notice to
the Company revoking such request; provided, however, that this shall still
count as a Demand Registration unless the such holders of Registrable
Securities pay all Registration Expenses in connection with such Registration.

               (b)  Number of Registrations; Expenses. The Company shall not be
obligated to effect, or take any action to effect, (i) more than one Demand
Registration pursuant to Section 2.1(a)(i) of this Agreement in any twelve
month period, (ii) any Demand Registrations pursuant to Section 2.1(a)(i) after
the Company has effected two Demand Registrations at the request of the
Requisite Series D Holders; (iii) more than one Demand Registration pursuant to
Section 2.1(a)(ii), or (iv), more than one Demand Registration pursuant to
Section 2.1(a)(iii). The Company shall pay all Registration Expenses in
connection with Demand Registrations. Notwithstanding any other provisions
contained in this Section 2, the Company shall not be required to (y) register
any Registrable Securities pursuant to an Effective Registration Statement in
connection with a Demand Registration if any previous Registration Statement
became Effective less than 180 days prior to such request; or (z) effect any
Demand Registration under Section 2.1(a) unless the market value of the
Registrable Securities to be sold in any such Demand Registration shall be
estimated to be at least $10,000,000 at the time of filing such Registration
Statement.

               (c)  Effective Registration Statement. A Demand Registration shall
not be deemed to have been effected unless the Registration Statement relating
thereto (i) has become Effective under the Securities Act and 50% or more of
the Registrable Securities of the holders thereof included in such Registration
have actually been sold thereunder, and (ii) has remained Effective for a
period of at least 90 days (or such shorter period in which all Registrable
Securities included in such Registration have actually been sold thereunder);
provided, however, that if after any Registration Statement requested pursuant
to this Section 2

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becomes Effective (x) such
Registration Statement is subject to any stop order, injunction or
other order or requirement of the Commission
or other governmental agency or court solely due to the actions or omissions to
act of the Company, (y) the conditions specified in the underwriting agreement,
if any, entered into in connection with such Demand Registration are not
solidified or waived, other than by reason of a failure of the holders
initiating such Demand Registration, such Registration Statement shall not be
counted as a Demand Registration.

               (d)  Selection of Underwriters. If any Demand Registration is in
the form of an underwritten offering, the Holders of a majority of the
Registrable Securities to be included in such Registration shall have the right
to select the investment banker and manager or co-managers that will administer
the offering, subject to the approval of the Company, which approval shall not
be unreasonably withheld.

               (e)  Priority in Demand Registrations. If a Demand Registration
pursuant to this Section 2 involves an underwritten offering and the managing
underwriter shall advise the Company that, in its view, the number of equity
securities requested to be included in such Registration exceeds the largest
number of securities which can be sold without having an adverse effect on such
offering, including the price at which such securities can be sold, the Company
will include in such Registration (i) first, shares of Common Stock
issued or issuable upon conversion of the Series D Preferred Stock proposed to
be registered by the holders thereof, pro rata based on the number of shares of
Common Stock proposed to be registered by each such Person, (ii) second,
Registrable Securities proposed to be registered by the Holders thereof, pro
rata based on the number of Registrable Securities proposed to be registered by
each such Holder and (iii) third, securities that the Company proposes
to issue and sell for its own account and all other securities proposed to be
registered by the holders thereof, pro rata based on the number of securities
proposed to be registered by each such Person.

               (f)  Disadvantageous Condition. Notwithstanding the foregoing, if
the Company shall furnish to the Holder or Holders initiating registration
pursuant to Section 2.1, a certificate signed by the Chairman of the Board or
Chief Executive Officer of the Company stating that (i) the Company is
conducting or about to conduct an offering of its securities and has been
advised by its investment banker that such offering will be materially
adversely affected by the registration so demanded, or (ii) the Company is
engaged in a material financing, merger, acquisition of assets, sale of assets,
recapitalization or other similar corporate action and in the good faith
judgment of the Board of Directors, it would seriously impair the ability of
the Company to effect the registration or would be seriously detrimental to the
Company and its stockholders if such transaction were to be disclosed at such
time, and it is therefore essential to defer the filing of a Registration
Statement, the Company shall have the right to defer such filing for a period
of not more than 90 days after receipt of the request for registration;
provided, however, that the Company may not utilize this deferral right more
than once in any twelve month period.

          2.2. Incidental Registration.

               (a)  Initial Public Offering. The Company shall give each holder of
Series D Shares prompt written notice at least 15 days prior to the filing of
any Registration Statement in connection with the Initial Public Offering.
Such notice shall offer each holder of

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Series D Shares the opportunity to
include in such Registration Statement such number of Registrable Securities as
each holder of Series D Shares may request. Upon the written request of each
holder of Series D Shares made within 15 days after the receipt of the
Company’s notice (which request shall specify the number of Registrable
Securities intended to be disposed of by each holder of Series D Shares and the
intended method of disposition thereof), the Company will use its reasonable
best efforts to effect the Registration under the Securities Act of all
Registrable Securities which the Company has been so requested to register by
each holder of Series D Shares; provided, however, that (x) if such
Registration involves an underwritten offering, each holder of Series D Shares
must sell its Registrable Securities to the underwriters selected by the
Company on the same terms and conditions as apply to the Company; and (y) if,
at any time after giving written notice of its intention to register any
securities pursuant to this Section 2.2(a) and prior to the Effective Date of
the Registration Statement filed in connection with such Registration, the
Company shall determine for any reason not to register such securities, the
Company shall give written notice to each holder of Series D Shares and shall
thereupon be relieved of its obligation to register any Registrable Securities
in connection with such Registration (without prejudice, however, to rights of
the holders of Series D Shares under Section 2.1). If a Registration pursuant
to this Section 2.2(a) involves an underwritten public offering, any holder of
Series D Shares may elect, in writing prior to the Effective Date of the
Registration Statement filed in connection with such Registration, not to
register such Registrable Securities in connection with such Registration. No
Registration effected under this Section 2.2(a) shall relieve the Company of
its obligations to effect Registrations upon request under Section 2.1 or
Section 2.3. The Company shall pay all Registration Expenses in connection
with each Registration of Registrable Securities requested pursuant to this
Section 2.2(a).

               (b)  After the Initial Public Offering. If the Company at any time
prior to 5 years from the date of the Initial Public Offering proposes to
register any of its equity securities under the Securities Act (other than a
Registration (i) relating to status of Common Stock issuable upon exercise of
employee stock options or in connection with any employee benefit or similar
plan of the Company, or (ii) in connection with an acquisition by the Company
of another company), it shall each such time, subject to the provisions of
Section 2.2(c), give prompt written notice to all Holders of its intention to
do so and of such Holders’ rights under this Section 2.2(b), at least 15 days
prior to the anticipated filing date of the Registration Statement relating to
such Registration. Such notice shall offer all such Holders the opportunity to
include in such Registration Statement such number of Registrable Securities as
each such Holder may request. Upon the written request of any such Holder made
within 10 days after the receipt of the Company’s notice (which request shall
specify the number of Registrable Securities intended to be disposed of by such
holder and the intended method of disposition thereof), the Company will use
its reasonable best efforts to effect the Registration under the Securities Act
of all Registrable Securities which the Company has been so requested to
register by the Holders thereof; provided, however, that (x) if such
Registration involves an underwritten offering, all Holders requesting to be
included in the Company’s Registration must sell their Registrable Securities
to the underwriters selected by the Company on the same terms and conditions as
apply to the Company; and (y) if, at any time after giving written notice of
its intention to register any securities pursuant to this Section 2.2(b) and
prior to the Effective Date of the Registration Statement filed in connection
with such Registration, the Company shall determine for any reason not to
register such securities, the Company shall give written notice to

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all Holders
and shall thereupon be relieved of its obligation to register any Registrable
Securities in connection with such Registration, (without prejudice, however,
to rights of the Holders of Registrable Securities under Section 2.1). If a
Registration pursuant to this Section 2.2(b) involves an underwritten public
offering, any Holder requesting to be included in such Registration may elect,
in writing prior to the Effective Date of the Registration Statement filed in
connection with such Registration, not to register such Registrable Securities
in connection with such Registration. No Registration effected under this
Section 2.2(b) shall relieve the Company of its obligations to effect
Registrations upon request under Section 2.1 or Section 2.3. The Company shall
pay all Registration Expenses in connection with each Registration of
Registrable Securities requested pursuant to this Section 2.2(b).

               (c)  Priority in Incidental Registrations. If a Registration
pursuant to Section 2.2 involves an underwritten offering and the managing
underwriter advises the Company that, in its good faith view, the number of
equity securities (including all Registrable Securities) which the Company, the
Holders and any other Persons intend to include in such Registration exceeds
the largest number of securities which can be sold without having an adverse
effect on such offering, including the price at which such Registrable
Securities can be sold, the Company will include in such Registration (i)
first, securities that the Company proposes to issue and sell for its
own account, (ii) second, Registrable Securities proposed to be
registered by holders of Series D Shares, pro rata based on the number of
Registrable Securities to be registered by each such holder, (iii)
third, Registrable Securities proposed to be registered by the Holders
thereof, pro rata based on the number of Registrable Securities to be
registered by each such Holder, and (iv) fourth, all other securities
proposed to be registered by the holders thereof, pro rata based on the number
of securities proposed to be registered by each such Person; provided, however,
that in no event shall the amount of Registrable Securities of the Requisite
Series D Holders included in any such Registration be reduced below twenty-five
percent (25%) of the total amount of securities included in such Registration
unless such Requisite Series D Holders have requested registration of less than
twenty-five percent (25%) of the total amount of securities included in such
Registration, unless such Registration is the Initial Public Offering, in which
case, the amount of Registrable Securities of the Requisite Series D Holders
included in any such Registration may be reduced below twenty-five percent
(25%) of the total amount of securities included in such Registration.

          2.3. Registrations on Form S-3.

               (a)  In case the Company shall receive from any holder of at least 20% of
the Common Stock issued or issuable upon conversion of the Series D Preferred
Stock, any holder or holders of at least 20% of the Common Stock issued or
issuable upon the conversion of the Series C Preferred Stock, or Loeb, a
written request or requests that the Company effect a registration on Form S-3
(or any successor form under the Securities Act) and any related qualification
or compliance with respect to all or a part of the Registrable Securities owned
by any such Holder or Holders, the Company will:

                    (i)  promptly give written notice of the proposed registration, and any
related qualification or compliance, to all other Holders; and

-13-

 

                    (ii)  as soon as practicable, use its reasonable best efforts to effect
such registration and all such qualifications and compliances as may be so
requested and as would permit or facilitate the sale and distribution of all or
such portion of such Holder’s or Holders’ Registrable Securities as are
specified in such request, together with all or such portion of the Registrable
Securities of any other Holder or Holders joining in such request as are
specified in a written request given within 15 days after receipt of such
written notice from the Company; provided, however, that the Company shall not
be obligated to effect more than three Registrations pursuant to this Section
2.3 at the request of Loeb and Conning; provided, further, that the Company
shall not be obligated to effect any such registration, qualification or
compliance, pursuant to this Section 2.3: (A) if Form S-3 is not available for
such offering by the Holders; (B) if the Holders, together with the holders of
any other securities of the Company entitled to inclusion in such registration,
propose to sell Registrable Securities and such other securities (if any) at an
aggregate price to the public (net of any underwriters’ discounts or
commissions) of less than $1,000,000; (C) if the Company shall furnish to the
Holders a certificate signed by the President or the Chief Financial Officer of
the Company stating that in the good faith judgment of the Board of Directors
of the Company, it would be seriously detrimental to the Company and its
stockholders for such Form S-3 Registration to be effected at such time, in
which event the Company shall have the right to defer the filing of the Form
S-3 registration statement for a period of not more than 90 days after receipt
of the request of the Holder or Holders under this Section 2.3; provided,
however, that the Company shall not utilize this right more than once in any
twelve month period; (D) if the Company has, within the 12 month period
preceding the date of such request, already effected two registrations on Form
S-3 for the Holders pursuant to this Section 2.3; (E) in any particular
jurisdiction in which the Company would be required to qualify to do business
or to execute a general consent to service of process in effecting such
registration, qualification or compliance; or (F) during the period ending 90
days after the effective date of a registration statement subject to Section
2.2.

               (b)  Subject to the foregoing, the Company shall file a Registration
Statement covering the Registrable Securities and other securities so requested
to be registered as soon as practicable after receipt of the request or
requests of the Holders. Registrations effected pursuant to this Section 2.3
shall not be counted as demands for registration or registrations effected
pursuant to Sections 2.1 or 2.2, respectively.

               (c)  If the Holders initiating the registration request under this Section
2.3 intend to distribute the Registrable Securities covered by their request by
means of an underwriting, they shall so advise the Company as a part of their
request made pursuant to this Section 2.3 and the Company shall include such
information in the written notice referred to in subsection 2.3(a). The
underwriter will be selected by a majority in interest of the Holders
requesting such registration and shall be reasonably acceptable to the Company.
In such event, the right of any Holder to include his Registrable Securities
in such registration shall be conditioned upon the inclusion of such Holder’s
Registrable Securities in the underwriting (unless otherwise mutually agreed by
a majority in interest of the Holders initiating such registration and such
Holder) to the extent provided herein. All Holders proposing to distribute
their securities through such underwriting shall (together with the Company as
provided in subsection 2.5(h)) enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwriting. Notwithstanding any other provision of this Section 2.3, if the
underwriter advises the Holders initiating such registration in writing that

-14-

 

marketing factors require a limitation of the number of shares of to be
underwritten, then the Holders initiating such registration shall advise all
Holders of Registrable Securities which would otherwise be underwritten
pursuant hereto, and the number of shares of Registrable Securities that may be
included in the underwriting shall be allocated among all Holders thereof,
including the Holders initiating such registration, in proportion (as nearly as
practicable) to the amount of Registrable Securities of the Company so
requested to be included owned by each Holder; provided however, that the
number of shares of Registrable Securities to be included in such underwriting
shall not be reduced unless all other securities are first entirely excluded
from the underwriting

               (d)  The Company shall pay all Registration Expenses in connection with
each Registration of Registrable Securities requested pursuant to this Section
2.3.

          2.4. Holdback Agreements.

               (a)  In connection with the Initial Public Offering and upon written
request of the Company or the underwriters managing such offering of the
Company’s equity securities, each Holder agrees not to sell, make any short
sale of, loan, grant any option for the purchase of, or otherwise dispose of
any equity securities of the Company (other than those included in the
Registration and any securities acquired by the Holder in or after such public
offering) without the prior written consent of the Company or such
underwriters, as the case may be, for such period of time not to exceed 3 days
prior to, and 180 days from, the Effective Date of such Registration as may be
requested by the Company or such managing underwriters and to execute an
agreement reflecting the foregoing as may be requested by the underwriters at
the time of such offering; provided, however, that all officers, directors, and
holders of more than 1% of the outstanding Common Stock (on an as-converted
basis) enter into similar standoff agreements. Any discretionary waiver or
termination of the restrictions of such agreements (including this Agreement)
by the Company or the managing underwriter shall apply to all persons subject
to such agreements on a pro rata basis, based upon the number of shares held by
each subject to such agreements. In connection with the issuance of securities
representing more than 1% of the outstanding Common Stock (on an as-converted
basis), the Company shall obtain agreements from the purchasers of such
securities substantially similar to those set forth in this Section 2.4(a),
unless otherwise unanimously approved by the Board of Directors of the Company.
The obligations described in Section 2.4 shall apply only if all officers and
directors of the Company enter into similar agreements.

               (b)  If any Registration of Registrable Securities shall be in connection
with an underwritten public offering, the Company agrees (i) not to effect any
sale or distribution of any of its equity securities or of any security
convertible into or exchangeable or exercisable for any equity security of the
Company (other than any such sale or distribution of such securities in
connection with any merger or consolidation by the Company or any Affiliate or
the acquisition by the Company or an Affiliate of the Company of the capital
stock or substantially all the assets of any other Person or in connection with
an employee stock ownership or other benefit plan) during the seven days prior
to, and during the 90 day period (or 180 day period in the case of the Initial
Public Offering) which begins on, the Effective Date of such Registration
Statement (except as part of such Registration) and (ii) that any agreement
entered into after the date hereof pursuant to which the Company issues or
agrees to issue any privately placed equity

-15-

 

securities shall contain a
provision under which the holders of such securities agree not to effect any
sale or distribution of any such securities during the period referred to in
the foregoing clause (i), including any sale pursuant to Rule 144, or any
successor provision, under the Securities Act (except as part of such
Registration, if permitted).

               (c)  Each Holder further agrees that the Company may impose stop-transfer
instructions with respect to the securities of each Holder in order to enforce
the foregoing covenants of this Section 2.4.

          2.5. Registration Procedures. In connection with any offering of
Registrable Securities registered pursuant to this Agreement, the Company
shall:

               (a)  Prepare and file with the Commission within 90 days after receipt of a
request for Registration, a Registration Statement on any form for which the
Company then qualifies and which counsel for the Company shall deem
appropriate, and which form shall be available for the sale of the Registrable
Securities in accordance with the intended methods of distribution thereof, and
use its reasonable best efforts to cause such Registration Statement to become
and remain Effective as provided herein, provided that before filing
with the Commission a Registration Statement or disclosure document
constituting part of a Registration Statement or any amendments or supplements
thereto, the Company will (x) furnish to one counsel selected by the holders of
a majority of the Registrable Securities covered by such Registration Statement
copies of all such documents proposed to be filed for said counsel’s review and
comment and (y) notify each holder of Registrable Securities covered by such
Registration Statement of any stop order issued or threatened by the Commission
and take all reasonable actions required to prevent the entry of such stop
order or to remove it if entered.

               (b)  Prepare and file with the Commission such amendments and supplements
to such Registration Statement and any disclosure document constituting part of
such Registration Statement used in connection therewith as may be necessary to
keep Effective such Registration Statement for a period of not less than 90
days or such shorter period which will terminate when all Registrable
Securities covered by such Registration Statement have been sold (but not
before the expiration of the 90 day period, if applicable, referred to in
Section 4(3) of the Securities Act and Rule 174 under the Securities Act, or
any successor thereto, if applicable), and comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by
such Registration Statement during such period in accordance with the intended
methods of disposition by the sellers thereof set forth in such Registration
Statement.

               (c) Furnish to each holder and each underwriter, if any, of Registrable
Securities covered by such Registration Statement such number of copies of such
Registration Statement, each amendment and supplement thereto (in each case
including all exhibits thereto), and the disclosure document included in such
Registration Statement (including each preliminary disclosure document), in
conformity with the requirements of the Securities Act, and such other
documents as any holder of Registrable Securities may reasonably request in
order to facilitate the disposition of the Registrable Securities owned by such
holder.

-16-

 

               (d)  Use its best reasonable efforts to register or qualify such
Registrable Securities under such other state securities or “blue sky” laws of
such jurisdictions as any holder, and underwriter, if any, of Registrable
Securities covered by such Registration Statement reasonably requests and do
any and all other acts and things which may be reasonably necessary or
advisable to enable such holder and each underwriter, if any, to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
holder; provided that the Company will not be required to (x) qualify
generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this Section 2.5(d), (y) subject itself to taxation
in any such jurisdiction or (z) consent to general service of process in any
such jurisdiction.

               (e)  Use its best reasonable efforts to cause the Registrable Securities
covered by such Registration Statement to be registered with or approved by
such other governmental agencies or authorities as may be necessary by virtue
of the business and operations of the Company to enable the holder or holders
thereof to consummate the disposition of such Registrable Securities.

               (f)  Immediately notify each holder of such Registrable Securities at any
time when a disclosure document relating thereto is required to be delivered
under the Securities Act of the happening of any event which comes to the
Company’s attention if as a result of such event the disclosure document
included in such Registration Statement contains an untrue statement of a
material fact or omits to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and promptly
prepare and furnish to such holder a supplement or amendment to such disclosure
document so that, as thereafter delivered to the holders of such Registrable
Securities, such disclosure document will not contain an untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading.

               (g)  Use its best reasonable efforts to cause all such Registrable
Securities to be listed on a national securities exchange (including NASDAQ)
and on each securities exchange on which similar securities issued by the
Company may then be listed, and enter into such customary agreements including
a listing application and indemnification agreement in customary form, and to
provide a transfer agent and registrar for such Registrable Securities covered
by such Registration Statement no later than the Effective Date of such
Registration Statement.

               (h)  Enter into such customary agreements (including an underwriting
agreement in customary form) and take all such other actions as the holders of
a majority of the Registrable Securities being covered by such Registration
Statement or the underwriters retained by such holders, if any, reasonably
request in order to expedite or facilitate the disposition of such Registrable
Securities, including customary representations, warranties, indemnities and
agreements.

               (i)  Make available for inspection by any holder of Registrable Securities
covered by such Registration Statement, any underwriter participating in any
disposition pursuant to such Registration Statement, and any attorney,
accountant or other agent retained by any such holder or underwriter
(collectively, the “Inspectors”), all financial and

-17-

 

other records,
pertinent corporate documents and properties of the Company (collectively,
“Records”), if any, as shall be reasonably necessary to enable them to
exercise their due diligence responsibility, and cause the Company’s and its
Affiliates’ officers, directors and employees to supply all information and
respond to all inquiries reasonably requested by any such Inspector in
connection with such Registration Statement.

               (j)  Use its best reasonable efforts to obtain a “cold comfort” letter from
the Company’s independent public accountants in customary form and covering
such matters of the type customarily covered by “cold comfort” letters as the
holders of a majority in interest of the Registrable Securities being sold
reasonably request.

               (k)  Otherwise uses its best reasonable efforts to comply with all
applicable rules and regulations of the Commission, and make available to the
holders of Registrable Securities, as soon as reasonably practicable, an
earnings statement covering a period of at least twelve months, beginning with
the first month after the Effective Date of the Registration Statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder.

          2.6. Furnishing Information; Delay of Registration. It shall be a
condition precedent to the obligation of the Company to take any action with
respect to securities of a holder of Registrable Securities that such holder
shall furnish to the Company such information regarding the securities held by
such holder and the intended method of disposition thereof as the Company shall
reasonably request and as shall be required in connection with the action taken
by the Company. Each holder of Registrable Securities agrees that, upon
receipt of any notice from the Company of the happening of any event of the
kind described in Section 2.5(f), such holder will forthwith discontinue
disposition of Registrable Securities until such holder’s receipt of the copies
of the supplemented or amended disclosure document contemplated by Section
2.5(f) hereof, and, if so directed by the Company, such holder will deliver to
the Company (at the Company’s expense) all copies (including, without
limitation, any and all drafts), other than permanent file copies, then in such
holder’s possession, of the disclosure document covering such Registrable
Securities current at the time of receipt of such notice. In the event the
Company shall give any such notice, the period mentioned in Section 2.5(b)
shall be extended by the number of days during the period from and including
the date of the giving of such notice pursuant to Section 2.5(f) hereof to and
including the date when each holder of Registrable Securities covered by such
Registration Statement shall have received the copies of the supplemented or
amended disclosure document contemplated by Section 2.5(f) hereof.

          2.7. Indemnification.

               (a)  Indemnification by the Company. In the event of any
Registration of any securities of the Company under the Securities Act pursuant
to this Agreement, the Company will indemnify and hold harmless, to the full
extent permitted by law, each of the Holders of any Registrable Securities
covered by such Registration Statement, their respective directors and
officers, general partners, limited partners and managing directors, each other
person who participates as an underwriter in the offering or sale of such
securities and each other person, if any, who controls, is controlled by or is
under common control with any such Holder or any such underwriter within the
meaning of the Securities Act (and directors, officers,

-18-

 

controlling persons,
partners and managing directors of any of the foregoing), against any and all
losses, claims, damages or liabilities, joint or several, and expenses
(including any amounts paid in any settlement effected with the Company’s
consent, which consent will not be unreasonably withheld) to which such holder,
any such director or officer or general or limited partner or managing director
or any such underwriter or controlling person may become subject under the
Securities Act, state securities or “blue sky” laws, common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) or expenses arise out of or are based upon (i)
any untrue statement or alleged untrue statement of any material fact
contained, on the Effective Date thereof, in any Registration Statement under
which such securities were registered under the Securities Act, any
preliminary, final or summary disclosure document contained therein, or any
amendment or supplement thereto, (ii) 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, or (iii) any violation or alleged violation
by the Company of any federal, state or common law rule or regulations
applicable to the Company and relating to action required of or inaction by the
Company in connection with any such Registration. The Company shall reimburse
each such Holder and each such director, officer, general partner, limited
partner, managing director or underwriter and controlling person for any legal
or any other expenses reasonably incurred by them in connection with
investigating or defending such loss, claim, liability, action or proceeding,
provided, however, that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission made in such
Registration Statement or amendment or supplement thereto or in any such
preliminary, final or summary disclosure document in reliance upon and in
conformity with written information furnished to the Company through an
instrument duly executed by such Holder in its capacity as a Holder of
Registrable Securities in the Company or any such director, officer, general or
limited partner, managing director or underwriter specifically stating that it
is for use in the preparation thereof; and, provided further, that the Company
shall not be liable to any Holder of Registrable Securities, any person who
participates as an underwriter in the offering or sale of Registrable
Securities, if any, or any other person, if any, who controls such underwriter
within the meaning of the Securities Act, pursuant to this Section with respect
to any preliminary disclosure document or the final disclosure document or the
final disclosure document as amended or supplemented as the case may be, to the
extent that any such loss, claim, damage or liability of such underwriter or
controlling person results from the fact that such underwriter sold Registrable
Securities to a person to whom there was not sent or given, at or prior to the
written confirmation of such sale, a copy of the final disclosure document or
of the final disclosure document as then amended or supplemented, whichever is
most recent, if the Company has previously furnished copies thereof to such
underwriter and such final disclosure document, as then amended or
supplemented, had corrected any such misstatement or omission. The indemnity
provided for herein shall remain in full force and effect regardless of any
investigation made by or on behalf of such Holder or any such director,
officer, general partner, limited partner, managing director, underwriter or
controlling person and shall survive the transfer of such securities by such
Holder.

               (b)  Indemnification by the Holders and Underwriters. The Company
may require, as a condition to including any Registrable Securities in any
Registration Statement filed in accordance with the provisions hereof, that the
Company shall have received

-19-

 

an undertaking reasonably satisfactory to it from
the Holders or any underwriter, to indemnify and hold harmless (in the same
manner and to the same extent as set forth in paragraph (a) above) the Company
and its directors, officers, controlling persons and all other prospective
sellers and their respective directors, officers, general and limited partners,
managing directors, and their respective controlling persons with respect to
any statement or alleged statement in or omission or alleged omission from such
Registration Statement, any preliminary, final or summary disclosure document
contained therein, or any amendment or supplement, if such statement or alleged
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company or its
representatives through an instrument duly executed by or on behalf of such
Holder or underwriter specifically stating that it is for use in the
preparation of such Registration Statement, preliminary, final or summary
disclosure document or amendment or supplement, or a document incorporated by
reference into any of the foregoing. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf of the Company
or any of the Holders, underwriters or any of their respective directors,
officers, general or limited partners, managing directors or controlling
persons and shall survive the transfer of such securities by such Holder,
provided, however, that no such Holder shall be liable in the aggregate for any
amounts exceeding the product of the sale price per Registrable Security and
the number of Registrable Securities being sold pursuant to such Registration
Statement or disclosure document by such Holder.

               (c)  Notices of Claims, etc. Promptly after receipt by an
indemnified party hereunder of written notice of the commencement of any action
or proceeding with respect to which a claim for indemnification may be made
pursuant to this Section 2.7, such indemnified party will, if a claim in
respect thereof is to be made against an indemnifying party, promptly give
written notice to the indemnifying party of the commencement of such action,
provided that the failure of any indemnified party to give notice as provided
herein shall not relieve the indemnifying party of its obligations under the
preceding subsections of this Section, except to the extent that the
indemnifying party is actually materially prejudiced by such failure to give
notice. In case any such action is brought against an indemnified party,
unless in such indemnified party’s reasonable judgment a conflict of interest
between such indemnified and indemnifying parties may exist in respect of such
claim, the indemnifying party will be entitled to participate in and, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, to the extent that it may wish, with counsel reasonably satisfactory
to such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof, unless in such indemnified party’s reasonable judgment a
conflict of interest between such indemnified and indemnifying parties arises
in respect of such claim after the assumption of the defense thereof, and the
indemnifying party will not be subject to any liability for any settlement made
without its consent (which consent shall not be unreasonably withheld). No
indemnifying party will 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. An indemnifying party who is
not entitled to, or elects not to, assume the defense of a claim will not be
obligated to pay the fees and expenses of more than one counsel in any single
jurisdiction for all parties indemnified by such indemnifying party with
respect to such claim, unless in the reasonable judgment of any indemnified
party a conflict of interest may

-20-

 

exist between such indemnified party and any
other of such indemnified parties with respect to such claim, in which event
the indemnifying party shall be obligated to pay the fees and expenses of such
additional counsel or counsels as may be reasonably necessary. Notwithstanding
anything to the contrary set forth herein, and without limiting any of the
rights set forth above, in any event any party will have the right to retain,
at its own expense, counsel with respect to the defense of a claim.

               (d)  Other Indemnification. Indemnification similar to that
specified in the preceding subsections of this Section 2.7 (with appropriate
modifications) shall be given by the Company and each Holder with respect to
any required Registration or other qualification of securities under any
federal or state law or regulation or governmental authority other than the
Securities Act.

               (e)  Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
this Section 2.7 is for any reason held to be unenforceable although applicable
in accordance with its terms, the Company, the Holders and the underwriters
shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by such indemnity agreement incurred by the
Company, the Holders and the underwriters, in such proportions that the
underwriters are responsible for that portion represented by the percentage
that the underwriting discount appearing in the disclosure document bears to
the initial public offering price appearing therein and the Company and the
holders of Registrable Securities are responsible for the balance; provided,
however, that no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. As between the Company and the Holders, such parties shall
contribute to the aggregate losses, liabilities, claims, damages and expenses
of the nature contemplated by such indemnity agreement in such proportion as
shall be appropriate to reflect (x) the relative benefits received by the
Company, on the one hand, and the Holders of the Registrable Securities
included in the offering, on the other hand, from the offering of the
Registrable Securities and any other securities included in such offering, and
(y) the relative fault of the Company, on the one hand, and the Holders of the
Registrable Securities included in the offering, on the other, with respect to
the statements or omissions which resulted in such loss, liability, claim,
damage or expense, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company, on
the one hand, and the Holders on the other, with respect to such offering shall
be deemed to be in the same proportion as the total purchase price paid to the
Company in respect of the Registrable Securities plus the total net proceeds
from the offering of any securities included in such offering (before deducting
expenses) received by the Company bears to the amount by which the total net
proceeds from the offering of Registrable Securities (before deducting
expenses) received by the Holders with respect to such offering exceeds the
purchase price paid to the Company in respect of the Registrable Securities,
and in each case the net proceeds received from such offering shall be
determined as set forth in the disclosure document. The relative fault shall
be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company or the
Holders, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Holders agree that it would not be just and equitable if
contribution pursuant to this Section

-21-

 

2.7 were to be determined by pro rata
allocation or by any other method of allocation which does not take into
account the equitable considerations referred to herein. Notwithstanding
anything to the contrary contained herein, the Company and the holders of
Registrable Securities agree that any contribution required to be made by such
holder pursuant to this Section 2.7(e) shall not exceed the net proceeds from
the offering of Registrable Securities (before deducting expenses) received by
such Holder with respect to such offering. For purposes of this Section, each
Person, if any, who controls a holder of Registrable Securities or an
underwriter within the meaning of Section 15 of the Securities Act shall have
the same rights to contribution as such holder or Underwriter, and each
director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act shall have the same
rights to contribution as the Company.

          2.8.
Reports Under Securities Exchange Act of 1934. With a view to
making available to the Investors the benefits of Rule 144 promulgated under
the Securities Act (“Rule 144”) and any other rule or regulation of the
Commission that may at any time permit an Investor to sell securities of the
Company to the public without registration or pursuant to a registration on
Form S-3, the Company agrees to:

               (a)  make and keep public information available, as those terms are
understood and defined in Rule 144, at all times after ninety (90) days after
the effective date of the first Registration Statement filed by the Company for
the offering of its securities to the general public so long as the Company
remains subject to the periodic reporting requirements under Sections 13 or
15(d) of the Exchange Act;

               (b)  take such action, including the voluntary registration of its Common
Stock under Section 12 of the Exchange Act, as is necessary to enable the
Holders to utilize Form S-3 for the sale of their Registrable Securities, such
action to be taken as soon as practicable after the end of the fiscal year in
which the first Registration Statement filed by the Company for the offering of
its securities to the general public is declared Effective;

               (c)  file with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange
Act; and

               (d)  furnish to any Holder, so long as the Holder owns any Registrable
Securities, forthwith upon request (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144 (at any time after
ninety (90) days after the Effective Date of the first Registration Statement
filed by the Company), the Securities Act and the Exchange Act (at any time
after it has become subject to such reporting requirements), or that it
qualifies as a registrant whose securities may be resold pursuant to Form S-3
(at any time after it so qualifies), (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed
by the Company, and (iii) such other information as may be reasonably requested
in availing any Holder of any rule or regulation of the Commission which
permits the selling of any such securities without registration or pursuant to
such form.

Notwithstanding the foregoing, the Company may deregister any class of its
equity securities under Section 12 of the Exchange Act or suspend its duty to
file reports with respect to any class

-22-

 

of its securities pursuant to Section
15(d) of the Exchange Act if it is then permitted to do so pursuant to the
Exchange Act and the rules and regulations thereunder.

          2.9.
Assignment of Registration Rights. The rights to cause the
Company to register Registrable Securities pursuant to this Section 2 may be
assigned (but only with all related obligations and in compliance with the
terms and conditions of the Stockholders’ Agreement) by a Holder (a) in
connection with any transfer or assignment by a Holder of Series D Shares, any
transferee or assignee, or (b) in connection with any transfer or assignment by
a Holder of any number of shares to (i) any partner, retired partner, member or
shareholder of such Holder or any transfer to spouses and ancestors, lineal
descendants and siblings of such partners, members or shareholders or spouses
who acquire Registrable Securities by gift, will, intestate succession or
otherwise or (ii) to any Affiliate of a Holder, provided that the Company is
given notice of such transfer (including the name and address of such
transferee) within a reasonable time thereafter and any such transferee shall
agree to become subject to the obligations of the Holders under this Agreement.
For the purposes of determining the number of shares of Registrable Securities
held by a transferee or assignee, the holdings of transferees and assignees of
a partnership or limited liability company who are partners or retired partners
of such partnership or members of such limited liability company (including
spouses and ancestors, lineal descendants and siblings of such partners or
spouses who acquire Registrable Securities by gift, will or intestate
succession) shall be aggregated together and with the partnership or limited
liability company; provided that all assignees and transferees who would not
qualify individually for assignment of registration rights shall have a single
attorney-in-fact for the purpose of exercising any rights, receiving notices or
taking any action under Section 2.

          2.10. Limitations on Subsequent Registration Rights. From and
after the date of this Agreement, the Company shall not, without the prior
written consent of the Requisite Series D Holders, enter into any agreement
other than this Agreement with any holder or prospective holder of any
securities of the Company which would allow such holder or prospective holder
(a) to include such securities in any registration filed under Section 2.1, 2.2
or 2.3 hereof, unless under the terms of such agreement, such holder or
prospective holder may include such securities in any such registration only to
the extent that the inclusion of his securities will not reduce the amount of
the Registrable Securities of the Holders which is included or (b) to make a
demand registration which could result in such registration statement being
declared effective prior to the earlier of the third anniversary of the Closing
Date or within one hundred eighty (180) days of the Effective Date of any
Registration effected pursuant to Section 2.1

     3.     Covenants of the Company.

          3.1. Affirmative Covenants. The Company covenants and agrees that
on and after the Closing Date and until the consummation of a Qualified Public
Offering it will:

               (a)  Inspection Rights. Permit during normal business hours, upon
reasonable request and reasonable notice, each Qualified Holder and each of its
employees, agents and representatives thereof, to examine and make copies of
and extracts from the records and books of account of, and visit and inspect
the properties, assets, operations and business of the Company and any
Subsidiary, and to discuss the affairs, finances and accounts of the

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Company
and any Subsidiary with any of its officers, consultants, directors, employees,
attorneys or independent accountants.

               (b)  Budgets Approval. At least thirty (30) days prior to the
commencement of each fiscal year, prepare and submit to, and obtain in respect
thereof the approval of the Board of Directors, a business plan and monthly
operating budget in detail for such fiscal year.

               (c)  Financing. Promptly, fully and in detail, inform all of the
members of the Board of Directors of any discussions, offers or contracts
relating to possible financings of any material nature for the Company or any
Subsidiary, whether initiated by the Company, any Subsidiary or any other
Person.

               (d)  Meetings of Directors. Hold meetings of the Board of Directors
not less than on a quarterly basis.

               (e)  By-Laws: Meetings and Indemnification. Use its best efforts to
at all times cause its By-Laws to provide that (i) any director shall have the
right to call a meeting of the Board of Directors, (ii) any holder or holders
of at least 25% of the outstanding shares of Series C Preferred Stock or Series
D Shares shall have the right to call a meeting of stockholders and (iii) at
least 24 hours prior notice shall be given to each director prior to a special
meeting of the Board of Directors. The Company shall at all times maintain
provisions in the Certificate of Incorporation or the By-Laws indemnifying all
officers and directors against liability to the maximum extent permitted under
the laws of the state of its incorporation.

               (f)  Entity Existence, etc. Maintain, and cause each of the
Subsidiaries to maintain, their respective corporate, partnership or limited
liability company existence, Proprietary Rights, other rights and franchises in
full force and effect.

               (g)  Properties, Business, Insurance. Maintain, and cause each of
the Subsidiaries to maintain, as to their respective properties and business,
with financially sound and reputable insurers, insurance against such
casualties and contingencies and of such types and in such amounts as is
customary for companies of a similar size and financial condition similarly
situated within the same industry.

               (h)  Expenses of Directors. Promptly reimburse each director and
any Observer (as such term is defined in Article V of the Stockholders’
Agreement) for all of their reasonable out-of-pocket, expenses incurred in
attending each meeting of the Board of Directors or any committee thereof.

               (i)  Compliance with Laws. Comply, and cause each Subsidiary to
comply, in all material respects with all applicable laws, rules, regulations
and orders.

               (j)  Keeping of Records and Books of Account. Keep, and cause each
Subsidiary to keep, adequate records and books of account, in which complete
entries will be made in accordance with GAAP consistently applied (except for
changes permitted by GAAP), reflecting all financial transactions of the
Company and such Subsidiary, and in which,

-24-

 

for each fiscal year, all proper
reserves for depreciation, depletion, obsolescence, amortization, taxes, bad
debts and other purposes in connection with its business shall be made.

               (k)  Size of Board and Committees. Fix and maintain the number of
and the selection of directors on the Board of Directors in accordance with the
terms and conditions set forth in Article V of the Stockholders Agreement.

               (l)  Rule 144A Information. At all times during which the Company
is neither subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, nor exempt from reporting pursuant to Rule 12g3-2(b) under the
Exchange Act, promptly as practicable (in any event not later than twenty (20)
days after initial request) in written form, upon the written request of any
Holder, furnish all information required by Rule 144A(d)(4)(i) of the General
Regulations promulgated by the Commission under the Securities Act (“Rule 144A
Information”). The Company further covenants, upon written request, as promptly
as practicable (in any event not later than twenty (20) days after initial
request) to cooperate with and assist any Qualified Holder or any member of the
NASD system for Private Offerings Resales and Trading through Automated Linkage
(“PORTAL”) in applying to designate and thereafter maintain the eligibility of
the Registrable Securities for trading through PORTAL. The Company’s
obligations under this Section 3.1(l) shall at all times be contingent upon the
relevant holder’s obtaining from a prospective purchaser an agreement to take
all reasonable precautions to safeguard the Rule 144A Information from
disclosure to anyone other than a Person who will assist such purchaser in
evaluating the purchase of the Registrable Securities.

               (m)  Reporting Requirements. Furnish the following to each
Qualified Holder:

                    (i)  Monthly Reports: as soon as available and in any event within
30 days (or, in the case of the last calendar month of each fiscal year, 60
days) after the end of each calendar month of the Company, consolidated balance
sheets of the Company and the Subsidiaries as of the end of such month and
consolidated statements of income and statements of cash flows and changes in
stockholders’ equity of the Company and the Subsidiaries for such month (and,
in the case of the last calendar month of each fiscal quarter, such fiscal
quarter) and for the period commencing at the end of the previous fiscal year
and ending with the end of such month, setting forth in each case in
comparative form the corresponding figures for the corresponding period of the
preceding fiscal year, and including comparisons to the budget or business plan
and an analysis of the variances from the budget or plan, prepared in
accordance with GAAP consistently applied;

                    (ii) 
Quarterly Financials: within forty-five (45) days after the
end of each of the first three Fiscal Quarters, consolidated financial
information regarding the Company and its Subsidiaries, certified by the Chief
Financial Officer of the Company, including (A) unaudited balance sheets as of
the close of such Fiscal Quarter and the related statements of income and cash
flow for that portion of the Fiscal Year ending as of the close of such Fiscal
Quarter and (B) unaudited statements of income and cash flows for such Fiscal
Quarter, in each case setting forth in comparative form the figures for the
corresponding period in the prior year and the figures contained in the
Projections for such Fiscal Year, all prepared in accordance with GAAP (subject
to normal year-end adjustments). Such financial information

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shall be
accompanied by the certification of the Chief Financial Officer of the Company
that such financial information presents fairly in accordance with GAAP
(subject to normal year-end adjustments) the financial position, results of
operations and statements of cash flows of the Company and its Subsidiaries, on
a consolidated basis, as at the end of such Fiscal Quarter and for the period
then ended. In addition, the Company shall deliver to each Qualified
Purchaser, within forty-five (45) days after the end of each of the first three
Fiscal Quarters, a management discussion and analysis which includes a
comparison to budget for that Fiscal Quarter and a comparison of performance
for that Fiscal Quarter to the corresponding period in the prior year;

                    (iii)  Annual Reports: as soon as available and in any event within
90 days after the end of each fiscal year of the Company, a copy of the annual
audit report for such year for the Company and the Subsidiaries, including
therein consolidated balance sheets of the Company and the Subsidiaries as of
the end of such fiscal year and consolidated statements of income and
statements of cash flows and changes in stockholders’ equity of the Company and
the Subsidiaries for such fiscal year, setting forth in each case in
comparative form the corresponding figures for the preceding fiscal year, all
such consolidated statements to be duly certified by an independent public
accountant of recognized national standing approved by the Board of Directors;

                    (iv)  Officer’s Certificate: as soon as possible and in any event
within 60 days after the end of each fiscal year of the Company, a certificate
executed by a duly authorized officer of the Company representing as to the
compliance of the Company with the provisions of Section 3.1 and 3.2, and

                    (v)  Reports and Other Information: within 10 days after receipt,
publication, commencement or occurrence, copies of all consulting reports,
management reports, notices of all material actions, filings made with the
Commission, such information as the Company or any Subsidiary shall make
available to any of its stockholders and such other information as any
Qualified Holder shall reasonably request.

               (n)  Reports to Directors. Furnish the following to each member of
the Board of Directors:

                    (i)  Accountant’s Letters: within 10 days after receipt, copies of
all accountant’s internal control letters and reports to management;

                    (ii)  Notice of Adverse Changes: promptly after the occurrence
thereof and in any event within 10 days after each occurrence, notice of any
default under any material agreement; or any material litigation, proceedings,
suits or investigations affecting the Company or any Subsidiary; or any
material adverse change in the business, assets, operations or condition of the
Company or any Subsidiary; and

                    (iii)  SEC Filings: within 10 days of occurrence, copies of all
filings made with the Commission.

               (o)  Key Man Life Insurance. The Company shall maintain such a key
person insurance policy obtained pursuant to Section 8.1(l) of the Purchase
Agreement, or

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any replacement therefore, in a face amount of not less than
$5,000,000 on the life of Michael Stanfield, with the benefits under such
policy payable to the Company.

          3.2. Negative Covenants. Other than in respect of a transaction
that complies with the provisions of Article III and IV of the Stockholders’
Agreement, the Company covenants and agrees that on and after the Closing Date
and until the consummation of a Qualified Public Offering it will not, without
the prior written consent of each of (i) the Requisite Series D Holders, and
(ii) the Requisite Series C Holders, voting separately:

               (a)  Distributions. Make, or permit any Subsidiary to make, any
Distribution except:

                    (i)  the Company may comply with any specific mandatory provisions of the
terms of the Preferred Stock as set forth in the Certificate of Incorporation;
and

                    (ii)  the declaration and payment of cash dividends by any Subsidiary on
its Equity Securities to the Company or a Wholly-Owned Subsidiary.

               (b)  Equity Securities. Authorize, issue or enter into, or permit
any Subsidiary to authorize, issue or enter into, any agreement providing for
the issuance (contingent or otherwise) of any capital stock or any other Equity
Securities (including debt securities) of the Company or any Subsidiary, except
for Permitted Equity Issuances; or reclassify, or permit any Subsidiary to
reclassify, any of its capital stock as in existence on the date hereof.

               (c)  Dealings with Affiliates. Enter into, or permit any Subsidiary
to enter into, any transaction(s) (including, without limitation, any loans or
extensions of credit, release of guarantee, management contract or royalty
agreements, deferred or contingent compensation agreement, consulting or other
agreement) with any Affiliate, except transactions in the ordinary course of
business and at prices and on terms not less favorable to the Company or such
Subsidiary than could be obtained on an arms-length basis from unrelated third
parties and otherwise approved by the disinterested members of the Board of
Directors.

               (d)  Compensation to Key Employees. Enter into, amend, modify or
waive, or permit any Subsidiary to enter into, amend, modify or waive, any
employment, benefit or compensation arrangement with any Key Employee or pay to
any Key Employee compensation in excess of that approved by the Compensation
Committee of the Board of Directors.

               (e)  Sale of Assets. Neither the Company nor CreditComm shall sell,
transfer, convey, assign or otherwise dispose of any of its properties or other
assets or any of their Accounts, having an aggregate fair market value equal to
or in excess of ten percent (10%) of the Company’s total assets (determined
with reference to book value) during any consecutive 12-month period, other
than (a) the sale of Inventory in the ordinary course of business, and (b) the
sale, transfer, conveyance or other disposition by the Company or CreditComm of
Equipment, Fixtures or real estate that are obsolete or no longer used or
useful in its business.

               (f) Intentionally Omitted.

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               (g)  Liquidation. Liquidate, dissolve or effect a recapitalization
or reorganization in any form of transaction, or permit any Subsidiary to
liquidate, dissolve or effect a recapitalization or reorganization in any form
of transaction.

               (h)  Acquisitions. Make, or permit any Subsidiary to make, any
Acquisition in which the aggregate consideration paid exceeds $6,000,000.

               (i)  Amendments. Amend or waive any provision of the Certificate of
Incorporation or the By-Laws in any way that would adversely affect the
liquidation preferences, dividend rights, voting rights or other rights of the
holders of the Series D Preferred Stock or otherwise change the terms of the
Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock,
or Series D Preferred Stock.

               (j)  Other Agreements. Enter into any agreement in which the terms
of such agreement would restrict or impair the right to perform of the Company
or any Subsidiary under this Agreement, the Certificate of Incorporation or any
other Related Agreement.

               (k)  Stock Option Plans. Neither the Company nor CreditComm shall:

		
	 	(A) Increase the number of options available for issuance, cancel
the number of options currently issued and reissue such options
(except to the extent such reissued options have an exercise price
in excess of the Applicable Conversion Value of the Series D Stock
and such reissuance does not require application of variable plan
accounting treatment), or amend the exercise price for the
currently issued options under the Stock Option Plan; provided,
however, that the Company shall be permitted to cancel options of
an employee upon the termination of such employee’s employment with
the Company and reissue the same in accordance with the terms of
the Stock Option Plan; or
	 
	 	(B) Except as permitted by clause (A) of this Section
3.2(k), adopt, or amend or waive any provision of, any
qualified or non-qualified stock option plan or agreement, employee
stock ownership plan, stock plan or any restricted stock grant
(including, without limitation, the Stock Option Plan) without the
approval of the disinterested members of the Board of Directors.

               (l)  Indebtedness.

                    (i)  Create, incur, assume or permit to exist, or permit any Subsidiary to
create, incur, assume or permit to exist, aggregate Indebtedness at any time in
excess of the levels set forth on Exhibit G to the Purchase Agreement,
which shall exclude (without duplication) (A) the Note and the other
Obligations, (B) unfunded pension fund and other employee benefit plan
obligations and liabilities to the extent they are permitted to remain unfunded
under applicable law, (C) any Indebtedness set forth in Disclosure Schedule
(7.5) of the Purchase Agreement, and (D) any Permitted Secured
Indebtedness.

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                    (ii)  Directly or indirectly, voluntarily purchase, redeem, defease or
prepay, or permit any Subsidiary to directly or indirectly, voluntarily
purchase, redeem, defease or prepay, any principal of, premium, if any,
interest or other amount payable in respect of any Indebtedness (excluding the
Obligations),

               (m)  Capital Structure and Business. Make any changes in any of
its business objectives, purposes or operations which could in any way
reasonably be expected to adversely affect the repayment of the Note or any of
the other Obligations or the Series D Stock or could reasonably be expected to
have or result in a Material Adverse Effect, or amend its charter, operating
agreement or bylaws in a manner which would adversely affect EFX, the Note, the
Series D Stock, or its duty or ability to repay the Obligations, or engage in
any business other than the businesses currently engaged in by it and its
Subsidiaries on the Closing Date and after giving effect to the consummation of
the Related Transactions (as such term is defined in the Purchase Agreement) or
businesses reasonably incidental thereto.

               (n)  Liens. Create, incur, assume or permit to exist, or permit any
Subsidiary to create, incur, assume or permit to exist, any Lien on or with
respect to any of its other properties or assets (whether now owned or
hereafter acquired) except for (i) Permitted Encumbrances (as such term is
defined in the Purchase Agreement) and (ii) Permitted Secured Indebtedness (as
such term is defined in the Purchase Agreement).

          3.3. Right of First Offer.

               (a)  Right of First Offer. Before the Company shall issue, sell or
exchange, agree or obligate itself to issue, sell or exchange, or reserve or
set aside for issuance, sale or exchange any Equity Securities to one or more
Persons, the Company shall, in each case, first offer (the “Offer”) to
sell such Equity Securities (the “Offered Securities”) to each Qualified
Holder and each other holder of at least 700 shares of Common Stock,
(determined on an “as if converted” basis and subject to equitable adjustment
whenever there shall occur a stock dividend, stock split, combination,
reorganization, recapitalization, reclassification or other similar event)
(collectively, the “Offerees”) up to a Pro Rata number of shares of
Offered Securities, at a price and on such other terms as applicable to such
issuance, sale or exchange of Offered Securities. The Company shall provide a
written notice (the “Offer Notice”) of the Offer to each Offeree, which
may accept the Offer by providing a written notice of acceptance of the Offer
to the Company within ten (10) days of delivery of the Offer Notice. If any
Offeree does not purchase any or all of its Pro Rata portion of the Offered
Securities, the other Offerees shall have the right to purchase such portion
until all of the Offered Securities are purchased or until such other Offerees
do not desire to purchase any more Offered Securities. In the event that the
Offer is not accepted by all Offerees, the Company shall have ninety (90) days,
commencing on the tenth (10th) day following delivery of the Offer Notice, in
which to sell the Offered Securities with respect to which an Offer was
accepted. The material terms of such sale, including, without limitation,
price and form of consideration, shall be as set forth in the Offer Notice. If
at the end of such 90-day period the other Persons have not completed the
purchase of all the Offered Securities, the provisions of this Section 3.3
shall continue to be in effect. Concurrently with the sale of the Offered
Securities to the other Persons, the Offerees shall purchase, and the Company
shall sell to the Offerees, that number of Offered Securities specified in the
notices of acceptance of the Offerees, upon the terms and conditions specified
in the Offer.

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               (b)  Exceptions. The rights of the Offerees under this Section 3.3
shall not apply to Permitted Equity Issuances.

               (c)  Governmental Approvals. Whenever an Offeree is entitled to
purchase Offered Securities under Section 3.3, any closing time period shall be
tolled until all requisite governmental approvals are obtained. The Company
agrees to use its best efforts to assist in obtaining all such governmental
approvals and to pay all reasonable out-of-pocket expenses (including
reasonable fees and out-of-pocket expenses of legal counsel) incurred by an
Offeree in connection with obtaining all such governmental approvals including,
without limitation, all expenses incurred pursuant to, if applicable, filings
under the Hart-Scott-Rodino Improvements Act of 1976.

               (d)  Termination. The rights of the Offerees under this Section 3.3
shall terminate immediately prior to the effectiveness of the Registration
Statement with respect to a Qualified Public Offering, but expressly
conditioned on the consummation of a Qualified Public Offering.

          3.4. Protective Provisions. From and after the Closing Date, and
prior to the Termination Date, the Company shall not, without first obtaining
the prior written consent of the Requisite Series D Holders:

               (a)  alter or change the rights, preferences, privileges, restrictions or
powers of the shares of Series D Preferred Stock;

               (b)  increase or decrease (other than by conversion) the total number of
authorized shares of Preferred Stock or Common Stock;

               (c)  authorize, create or issue, or obligate itself to issue, any other
equity security, including any other security convertible into or exercisable
for any equity security, having a preference over, or being on a parity with,
the Series D Preferred Stock with respect to dividends, liquidation,
redemption, antidilution or voting;

               (d)  reclassify any outstanding securities of the Company into any other
equity security, including any other security convertible into or exercisable
for any equity security, having a preference over, or being on a parity with,
the Series D Preferred Stock with respect to dividends, liquidation,
redemption, antidilution or voting;

               (e)  permit any subsidiary to issue or sell, or obligate itself to issue or
sell, except to the Company or any wholly-owned subsidiary of the Company, any
capital stock, membership interest, or other equity interest of such
subsidiary;

               (f)  redeem, purchase or otherwise acquire (or pay into or set funds aside
for a sinking fund for such purpose) any share or shares of Preferred Stock or
Common Stock; provided, however, that this restriction shall not
apply to the repurchase of shares of Common Stock from employees, officers,
directors, consultants or other persons performing services for the Company or
any subsidiary pursuant to agreements under which the Company has the option to
repurchase such shares upon the occurrence of certain events, such as the
termination of employment, or through the exercise of any right of first
refusal;

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               (g)  amend the Certificate of Incorporation or By-laws to increase or
decrease the authorized number of members of the Board of Directors; or

               (h)  declare, pay or set aside for payment any dividend on any shares of
the Company’s capital stock, other than for a stock split effected by a stock
dividend in connection with a Qualified Public Offering.

          3.5. Termination of Covenants.

               (a)  The covenants set forth in Sections 3.1 through Section 3.3 shall
terminate as to each Qualified Holder and be of no further force or effect (i)
immediately prior to the consummation of a Qualified Public Offering, or (ii)
upon termination of the entire Agreement upon a change in control of the
Company, as provided in Section 4.1.

               (b)  The covenants set forth in Sections 3.1(b) and 3.1(m) shall terminate
as to each Qualified Holder and be of no further force or effect when the
Company first becomes subject to the periodic reporting requirements of
Sections 13 or 15(d) of the Exchange Act, if this occurs earlier than the
events described in Section 3.5(a) above.

     4.     Miscellaneous.

          4.1.
Termination of Entire Agreement Upon Change of Control. This
Agreement shall terminate, and have no further force and effect, upon the
closing of (a) the Company’s sale of all or substantially all of its assets
following which the Company is liquidated or wound down, (b) the acquisition of
the Company by another entity by means of merger or consolidation (other than a
merger effected solely for the purpose of changing the domicile of the Company)
resulting in the exchange of all of the outstanding shares of the Company’s
capital stock held by the Investors for publicly-traded securities or cash or a
combination thereof, or (c) any other transaction or series of related
transactions in which more than 50% of the voting power of the Company is
disposed of, provided that the entire consideration received by the Investors
pursuant to such sale or acquisition consists solely of publicly-traded
securities or cash, or a combination thereof. As used in this Section 4.1
“publicly-traded securities” means any security for which is listed on
the Nasdaq National Market or on the New York Stock Exchange, provided that no
stockholder of the Company, including all of its affiliated entities, in the
aggregate receives more than 5% of the outstanding number of such securities.

          4.2.
Successors and Assigns. Except as otherwise provided in this
Agreement, the terms and conditions of this Agreement shall inure to the
benefit of and be binding upon the respective permitted successors and assigns
of the parties (including transferees of any of the Registrable Securities).
Nothing in this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective successors and assigns
any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.

          4.3. Amendments and Waivers. Any term of this Agreement may be
amended or waived only with the written consent of the Company and (a) the
holders of 66 2/3% of the Registrable Securities then outstanding, (b) the
Requisite Series C Holders, and (c) the Requisite Series D Holders. Any
amendment or waiver effected in accordance with this

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paragraph shall be binding
upon each party to this Agreement, regardless of whether such party has signed
such amendment or waiver, each then current or future holder of all such
Registrable Securities, and the Company.

          4.4.
Notices. Unless otherwise provided, any notice required or
permitted by this Agreement shall be in writing and shall be deemed sufficient
upon delivery, when delivered personally or by overnight courier or sent by
telegram or fax, or forty-eight (48) hours after being deposited in the U.S.
mail, as certified or registered mail, with postage prepaid, and addressed to
the party to be notified at such party’s address or fax number as set forth
below such party’s name on the signature pages hereto or as subsequently
modified by written notice to each other party.

          4.5.
Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (a)
such provision shall be excluded from this Agreement, (b) the balance of the
Agreement shall be interpreted as if such provision were so excluded and (c)
the balance of the Agreement shall be enforceable in accordance with its terms.

          4.6.
Governing Law. This Agreement and all acts and transactions
pursuant hereto shall be governed, construed and interpreted in accordance with
the laws of the State of New York, without giving effect to principles of
conflicts of laws.

          4.7.
Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

          4.8.
Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

          4.9.
Aggregation of Stock. All shares of the Registrable
Securities held or acquired by affiliated entities or persons shall be
aggregated together for the purpose of determining the availability of any
rights under this Agreement.

          4.10. Waiver of Shares Issuance Restrictions, Rights of First Offer and
Amendment Restrictions. By execution of this Agreement below, each of Loeb
and the holders of the Company’s Series C Preferred Stock, and each of them,
hereby consent to the issuance of the Note to EFX as contemplated by the
Purchase Agreement pursuant to Section 6.02 of the Series Agreement and waive
any rights to notice or to acquire the Note, shares of Series D Preferred Stock
issuable upon conversion of the Note, and any shares of Common Stock issuable
upon conversion of the Series D Preferred Stock to which they may be entitled,
including but not limited to those provided in Article 10 of the Series C
Purchase Agreement (such waiver intended to apply to all holders of Registrable
Securities under the Series C Purchase Agreement) and hereby consent to the
amendments of the Certificate of Incorporation made in connection with the
Purchase Agreement pursuant to Section 6.09.

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          4.11.
Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto pertaining to the subject matter hereof,
and any and all other written or oral agreements relating to the subject matter
hereof existing between the parties hereto are expressly canceled.

          4.12. Effectiveness of Agreement. This Agreement shall become
effective upon execution by (1) the Company, (2) the Requisite Series C
Holders, and (3) Loeb. Upon effectiveness of this Agreement, (y) the Series C
Purchase Agreement shall be amended by the deletion of Articles 5, 6, 7, 8, 9,
10 and 12 in their respective entireties, and the parties thereto shall have no
rights or obligations under such Articles, and (z) the Registration Rights
Agreement shall be terminated, and the parties thereto shall have no rights or
obligations thereunder.

          4.13. Events of Noncompliance.

               (a)  Any of the following events shall be an “Event of Noncompliance”: (i)
the Company fails to make any cumulative dividend or liquidation payment with
respect to the Series C Preferred Stock which it is obligated to make under the
Certificate of Incorporation, regardless of whether or not such payment is
legally permissible or funds are legally available therefor; (ii) any
representation or warranty made or deemed made by the Company in the Series C
Purchase Agreement, this Agreement, the Stockholders’ Agreement, or which is
contained in any certificate, document, opinion, financial or other statement
furnished at any time under or in connection herewith, the Purchase Agreement,
or the Stockholders’ Agreement shall prove to have been incorrect in any
material respect on or as of the date made or deemed made; or (iii) the Company
or Loeb shall fail to perform or observe any term, covenant or agreement
contain herein, in the Certificate of Incorporation or in the Stockholders’
Agreement and such failure shall continue unremedied for 3 consecutive days
after notice thereof.

               (b)  If any Event of Noncompliance has occurred and is continuing,
dividends shall accrue from day to day and shall be payable quarterly in
arrears on the Series C Preferred Stock at a rate per annum equal to 18%. The
imposition of the dividend rate under the operation of this paragraph shall
terminate as of the close of business on the date on which no Event of
Noncompliance exists, subject to subsequent impositions pursuant to this
Section 4.13. If any Event of Noncompliance exists, each Investor shall also
have any other rights which such holder is entitled to under any contract or
agreement at any time and any other rights which such holder may have pursuant
to applicable law.

          4.14. Confidentiality. Each Investor agrees not to use
Confidential Information (as hereinafter defined) of the Company obtained by it
pursuant to this Agreement for its own use or for any purpose except to
evaluate and enforce its investment in the Company and to enforce its rights as
an Investor. Except as permitted hereunder, each Investor agrees not to
disclose or divulge any such Confidential Information to any third parties
during the term of this Agreement. Each transferee of Registrable Securities
who receives Confidential Information shall agree to be bound by such
provisions. For purposes of this Section 4.14, “Confidential Information”
shall mean any non-public written records and documents and non-public
information and data relating to the Company, its subsidiaries or its business
furnished or

-33-

 

provided pursuant to inspection or visitation rights to an
Investor or its representatives either before or after the date of this
Agreement; provided, however, that Confidential Information shall not include
any information: (a) that is or becomes publicly known (other than as a result
of a breach by an Investor or its representatives of this Section 4.14); (b)
that has been or shall be otherwise independently acquired by or developed by
an Investor without violating the terms of this Agreement; or (c) is known by
an Investor or its representatives prior to its disclosure to Investor by the
Company. The provisions of this Section 4.14 shall not apply: (i) to the
extent that an Investor is required to disclose Confidential Information
pursuant to any law, statute, rule or regulation or any order of any court or
jurisdiction process of any person or entity; (ii) to the disclosure of
Confidential Information to the Investor’s employees, attorneys, accountants,
consultants, or other professional advisors; (iii) to the disclosure of
Confidential Information to any entity controlling, controlled or under common
control with an Investor, or to any stockholder, partner or member of an
Investor which is a corporation, partnership or limited liability company; or
(iv) to the disclosure of Confidential Information to a prospective transferee
of securities which agrees to be bound by the provisions of this Section 4.14
in connection with the receipt of such Confidential Information.

[Signature Pages Follow]

-34-

 

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

	 	 	 	 	 
	 	
 
	 	INTERSECTIONS INC.
	 
	 	 	
 
	By:
	 	 	
 
	 	

Name:

	 	 	
 
	 	Title:

 

 

SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT

DATED NOVEMBER      , 2001

 

	 	 	 	 	 
	 	 	
 
	“EXISTING INVESTORS”
	 
	 	 	
 
	LOEB HOLDING CORP.
	 
	 	 	
 
	By:
	 	 	
 
	 	

Name:

Title:
	 
	 	 	
 
	LOEB CAPITAL MANAGEMENT, INC.
	 
	 	 	
 
	By:
	 	 	
 
	 	

Name:

Title:
	 
	 	 	
 
	

Thomas L. Kempner

	 
	 
	 	 
	TRUSTS
F/B/O CHRISTOPHER KEMPNER, MARGARET KEMPNER, NINA KEMPNER, THOMAS NATHANIEL KEMPNER, TREVOR KEMPNER AND JESSICA KEMPNER DATED 3/7/00
	 
	 	 	
 
	By:
	 	 	
 
	 	

Name:

Title:

 

 

SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT

DATED NOVEMBER      , 2001

 

	 	 	 	 	 
	 	 	
 
	“EXISTING INVESTORS”
	 
	 	 	
 
	CONNING CAPITAL PARTNERS V, L.P.
	 
	 

 	 	
 

 
	By: 	Conning Investment
Partners V, LLC, its General Partner
	 
	 

 	 	
 

 
	By: 	Conning & Company,
its Manager Member
	 
	 	 	
 
	By:
	 
	 	
 
	 	

Name: Steven F. Piaker

Title:   Senior Vice President
	 
	 	 	
 
	RS-CO INVESTMENT FUND
	 
	 	 	
 
	By:
	 	 	
 
	 	

Name:

Title:

 

 

SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT

DATED NOVEMBER      , 2001

 

	 	 	 	 	 
	 	 	
 
	“EFX”
	 
	 	 	
 
	CD HOLDINGS INC.
	 
	 	 	
 
	By:
	 	 	
 
	 	

Name:

Title:

 

 

SIGNATURE PAGE TO INVESTORS’ RIGHTS AGREEMENT

DATED NOVEMBER      , 2001

 

EXHIBIT A

EXISTING INVESTORS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Number of	 	Number of shares	 	Number of shares	 	Number of shares
	 	 	shares of	 	of Series A	 	of Series B	 	of Series C
	Name and Address	 	Common Stock	 	Preferred Stock	 	Preferred Stock	 	Preferred Stock
	

	Loeb Holding Corporation
	 	 	7,919	 	 	 	18,937.5	 	 	 	8,800	 	 	 	0	 
	Loeb Capital Management
	 	 	80	 	 	 	0	 	 	 	0	 	 	 	0	 
	Thomas L. Kempner
	 	 	0	 	 	 	400	 	 	 	0	 	 	 	0	 
	Sidney R. Knafel
	 	 	20	 	 	 	50	 	 	 	300	 	 	 	0	 
	David McGough
	 	 	238	 	 	 	0	 	 	 	0	 	 	 	0	 
	Norman Mintz
	 	 	60	 	 	 	150	 	 	 	100	 	 	 	0	 
	David Philips
	 	 	20	 	 	 	50	 	 	 	0	 	 	 	0	 
	William J. Wilson
	 	 	20	 	 	 	50	 	 	 	0	 	 	 	0	 
	Ann Bernhard
	 	 	20	 	 	 	50	 	 	 	0	 	 	 	0	 
	Burnette Herrick
	 	 	20	 	 	 	50	 	 	 	0	 	 	 	0	 
	Joseph Lesser
	 	 	40	 	 	 	100	 	 	 	0	 	 	 	0	 
	William Perlmuth
	 	 	20	 	 	 	50	 	 	 	0	 	 	 	0	 
	John Rosenthal
	 	 	20	 	 	 	50	 	 	 	0	 	 	 	0	 
	Peter Tcherepnine
	 	 	10	 	 	 	25	 	 	 	0	 	 	 	0	 
	Harvey L. Tepner
	 	 	15	 	 	 	37.5	 	 	 	0	 	 	 	0	 
	Trust f/b/o Douglas R. Knafel and Andrew
	 	 	0	 	 	 	0	 	 	 	300	 	 	 	0	 
	G. Knafel dated 7/16/76
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Thomas Nathaniel Kempner Trust
	 	 	26.67	 	 	 	0	 	 	 	0	 	 	 	0	 
	Trevor Kempner Trust
	 	 	26.67	 	 	 	0	 	 	 	0	 	 	 	0	 
	Jessica Kempner Trust
	 	 	26.67	 	 	 	0	 	 	 	0	 	 	 	0	 
	Margaret Kempner Trust
	 	 	26.67	 	 	 	0	 	 	 	0	 	 	 	0	 
	Nina Kempner Trust
	 	 	26.67	 	 	 	0	 	 	 	0	 	 	 	0	 
	Christopher Kempner Trust
	 	 	26.67	 	 	 	0	 	 	 	0	 	 	 	0	 
	Conning Capital Partners V, L.P.
	 	 	0	 	 	 	0	 	 	 	0	 	 	 	15,000	 
	Castle Creek Venture Fund LLC
	 	 	0	 	 	 	0	 	 	 	0	 	 	 	1,000	 
	MCP Global Limited
	 	 	0	 	 	 	0	 	 	 	0	 	 	 	1,000	 
	RS-Co Investment Fund
	 	 	0	 	 	 	0	 	 	 	0	 	 	 	3,000	 
	Michelle Paul
	 	 	30	 	 	 	0	 	 	 	0	 	 	 	0	 
	Rock Davis
	 	 	176.25	 	 	 	0	 	 	 	0	 	 	 	0	 
	

	Total
	 	 	8,868.25	 	 	 	20,000	 	 	 	9,500	 	 	 	20,000	 

 

SCHEDULE A

STOCKHOLDERS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	Number of shares	 	 	 	 
	 	 	 	Number of shares	 	of Series A	 	Number of shares of
	Name	 	of Common Stock	 	Preferred Stock	 	Series B Preferred Stock
	

	Loeb Capital Management Inc.
	 	 	80	 	 	 	0	 	 	 	 	 
	Ann Bernhard
	 	 	20	 	 	 	50	 	 	 	 	 
	Burnette Herrick
	 	 	20	 	 	 	50	 	 	 	 	 
	Thomas L. Kempner
	 	 	0	 	 	 	400	 	 	 	 	 
	Sidney R. Knafel
	 	 	20	 	 	 	50	 	 	 	300	 
	Joseph Lesser
	 	 	40	 	 	 	100	 	 	 	 	 
	David McGough
	 	 	238	 	 	 	0	 	 	 	 	 
	Norman N. Mintz
	 	 	60	 	 	 	150	 	 	 	100	 
	William Perlmuth
	 	 	20	 	 	 	50	 	 	 	 	 
	David M. Phillips
	 	 	20	 	 	 	50	 	 	 	 	 
	John P. Rosenthal
	 	 	20	 	 	 	50	 	 	 	 	 
	Peter Tcherepnine
	 	 	10	 	 	 	25	 	 	 	 	 
	Harvey L. Tepner
	 	 	15	 	 	 	37.5	 	 	 	 	 
	Trust f/b/o Douglas R. Knafel and
Andrew G. Knafel dated 7/16/76
	 	 	 	 	 	 	0	 	 	 	300	 
	William J. Wilson
	 	 	20	 	 	 	50	 	 	 	 	 
	Trusts f/b/o Christopher Kempner, Margaret Kempner, Nina Kempner,
Thomas Nathaniel Kempner, Trevor
Kempner and Jessica Kempner dated
3/7/00
	 	 	160	 	 	 	0	 	 	 	 	 
	

	Total
	 	 	743	 	 	 	1,062.5	 	 	 	700

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