AGREEMENT AND PLAN OF MERGER

INDEX OF EXHIBITS

THIS AGREEMENT AND PLAN OF MERGER (the “ Agreement ”) is made and entered into as of October 6, 2009 by and among Compuware Corporation, a Michigan corporation (“ Parent ”), Compuware Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Parent (“ Merger Sub ”), Gomez, Inc., a Delaware corporation (the “ Company ”), and, with respect to Section 7.7 , Richard J. Brekka, Jaime W. Ellertson and Thomas A.F. Krueger, as members of the Securityholder Committee.  Certain capitalized terms used herein are defined in Section 9.1 .

A.           The Boards of Directors of each of Parent, Merger Sub and the Company believe it is in the best interests of its corporation and its respective stockholders that Parent acquire the Company through the statutory merger of Merger Sub with and into the Company (the “ Merger ”) and, in furtherance thereof, have approved the Merger.

B.           Pursuant to the Merger, among other things, and subject to the terms and conditions of this Agreement, all of the issued and outstanding capital stock of the Company shall be converted into the right to receive the consideration set forth in this Agreement.

C.           A portion of the consideration otherwise payable by Parent in connection with the Merger shall be placed in escrow by Parent as security for certain obligations set forth in this Agreement.

D.           The Company, on the one hand, and Parent and Merger Sub, on the other hand, desire to make certain representations, warranties, covenants and other agreements in connection with the Merger.

E.           Concurrent with the execution and delivery of this Agreement, as a material inducement to Parent and Merger Sub to enter into this Agreement, each Key Employee has entered into a confidentiality, non-competition, non-solicitation and development agreement to be effective at the Effective Time.

NOW, THEREFORE , in consideration of the mutual agreements, covenants and other premises set forth in this Agreement, the mutual benefits to be gained by the performance of such agreements, covenants and other premises, and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged and accepted, the parties agree as follows:

1.1            The Merger .  At the Effective Time and subject to and upon the terms and conditions of this Agreement and the applicable provisions of the Delaware General Corporation Law (“ Delaware Law ”), Merger Sub shall be merged with and into the Company, the separate corporate existence of Merger Sub shall cease, and the Company shall continue as the surviving corporation and as a wholly owned subsidiary of Parent.  The surviving corporation after the Merger is sometimes referred to hereinafter as the “ Surviving Corporation .”

1.2            Effective Time .  Unless another time and place is mutually agreed upon in writing by Parent and the Company, the closing of the Merger (the “ Closing ”) will take place at the offices of Dykema Gossett PLLC, 400 Renaissance Center, Detroit, Michigan, within two Business Days after the satisfaction or waiver of the conditions precedent set forth in Article V .  The date upon which the Closing occurs shall be referred to herein as the “ Closing Date .”  On the Closing Date, the parties hereto shall cause the Merger to be consummated by filing the Certificate of Merger in substantially the form attached hereto as Exhibit A , with the Delaware Secretary of State (the “ Certificate of Merger ”), in accordance with the applicable provisions of Delaware Law (the time of such filing with the Delaware Secretary of State shall be referred to herein as the “ Effective Time ”).

1.3            Effect of the Merger .  At the Effective Time, the effect of the Merger shall be as provided in the applicable provisions of Delaware Law.  Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, except as otherwise agreed to pursuant to the terms of this Agreement, all of the property, rights, privileges, powers and franchises of the Company and Merger Sub shall vest in the Surviving Corporation, and all debts, liabilities and duties of the Company and Merger Sub shall become the debts, liabilities and duties of the Surviving Corporation.

1.4            Certificate of Incorporation and Bylaws .

(a)           Unless otherwise determined by Parent prior to the Effective Time, the certificate of incorporation of Merger Sub, as in effect immediately prior to the Effective Time, shall be the certificate of incorporation of the Surviving Corporation at the Effective Time until thereafter amended in accordance with Delaware Law and as provided in such certificate of incorporation; provided, however , that at the Effective Time, Article I of the certificate of incorporation of the Surviving Corporation shall be amended and restated in its entirety to read substantially as follows (or such other name as determined by Parent in its sole discretion):  “The name of the corporation is Gomez, Inc.”

(b)           Unless otherwise determined by Parent prior to the Effective Time, the bylaws of Merger Sub, as in effect immediately prior to the Effective Time, shall be the bylaws of the Surviving Corporation at the Effective Time until thereafter amended in accordance with Delaware Law and as provided in the certificate of incorporation of the Surviving Corporation and such bylaws.

1.5            Directors and Officers of Surviving Corporation .  Unless otherwise determined by Parent prior to the Effective Time, the directors and officers of Merger Sub immediately prior to the Effective Time shall be the directors and officers of the Surviving Corporation immediately after the Effective Time, each to hold the office of a director or officer of the Surviving Corporation, as the case may be, in accordance with the provisions of Delaware Law and the certificate of incorporation and bylaws of the Surviving Corporation until their respective successors are duly elected and qualified, as applicable.

1.6            Effect of the Merger on the Capital Stock of the Constituent Corporations; Rights of Dissenting Stockholders .

(a)           The aggregate purchase price for the transactions contemplated by this Agreement shall be $290,000,000, less the amount of Company Debt outstanding immediately prior to the Effective Time and less the amount by which Third Party Expenses exceed $5,000,000 (the “ Merger Consideration ”).  At Closing, Parent shall (i) pay or cause to be paid the Merger Consideration, less the Escrow Amount and the Expense Amount, in accordance with the Paying Agent Spreadsheet and the Optionholder Spreadsheet; (ii) deposit an amount equal to $29,000,000 (the “ Escrow Amount ”) into the Escrow Fund; and (iii) deposit $1,000,000 (the “ Expense Amount ”) into the Expense Fund.

(b)           At the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, the Company, the Stockholders, the Optionholders or the Warrantholder:

(i)           each outstanding share of Company Common Stock (other than a Dissenting Share) will be converted automatically into and shall thereafter represent the right to receive, without interest thereon, an amount of cash equal to the Common Price Per Share;

(ii)           each outstanding share of Class A Convertible Preferred Stock or Class B Convertible Preferred Stock (other than in each case any Dissenting Share) will be converted automatically into and shall thereafter represent the right to receive, without interest thereon, an amount of cash equal to:

(A)           the Common Price Per Share plus

(B)           the Common Price Per Share, multiplied by the quotient of (1) the aggregate amount of dividends accumulated on such share as of immediately prior to the Effective Time divided by (2) $1.051;

(iii)           each outstanding share of Class C Convertible Preferred Stock (other than a Dissenting Share) will be converted automatically into and shall thereafter represent the right to receive, without interest thereon, an amount of cash equal to:

(A)           the Common Price Per Share plus

(B)           the Common Price Per Share, multiplied by the quotient of (1) the aggregate amount of dividends accumulated on such share as of immediately prior to the Effective Time divided by   (2) $1.650; and

(iv)           each outstanding share of common stock of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted automatically into and shall thereafter represent one share of common stock of the Surviving Corporation.

(c)           Notwithstanding anything in this Agreement to the contrary, shares of Company Capital Stock that are issued and outstanding immediately prior to the Effective Time and are held by any Stockholder who has not voted in favor of or consented to the approval of this Agreement (a “ Dissenting Stockholder ”) and who has the right to demand, and has properly demanded in writing, an appraisal of such shares of Company Capital Stock in accordance with Section 262 of the Delaware Law (the “ Dissenting Shares ”) shall not be converted into the right to receive any portion of the Merger Consideration, but rather shall be converted into the right to receive such consideration as may be determined to be due to such Dissenting Stockholder pursuant to Section 262 of the Delaware Law.  If, after the Effective Time, such Dissenting Stockholder fails to perfect, withdraws or otherwise loses any such right to appraisal, each such share of Company Capital Stock of such Dissenting Stockholder shall no longer be considered a Dissenting Share and shall be deemed to have converted as of the Effective Time into the right to receive the portion of the Merger Consideration, without interest, as provided in Section 1.6(b) , pursuant to the exchange procedures set forth in Section 1.9(a) .  At the Effective Time, all Dissenting Shares shall automatically be canceled, cease to exist and no longer be outstanding, and each holder of a stock certificate that immediately prior to the Effective Time represented any Dissenting Shares shall cease to have any rights with respect thereto, except the right to receive either payment of the fair value of such Dissenting Shares in accordance with Section 262 of the Delaware Law or the portion of the Merger Consideration provided in Section 1.6(b) , as the case may be, upon the surrender of such certificate in accordance with Section 1.9(a) .  The Company shall give prompt notice to Parent of the Company’s receipt of any demands for appraisal of shares of Company Capital Stock, withdrawals of such demands and any other instruments served pursuant to the Delaware Law, and Parent shall have the right to participate in all negotiations and proceedings with respect to such demands.  The Company shall not, except with the prior written consent of Parent (which shall not be unreasonably withheld or delayed), voluntarily make any payment with respect to, or settle or offer to settle, any such demands or agree to do or commit to do any of the foregoing except to the extent required by Delaware Law.

1.7            Company Warrant .  Prior to the Closing, the Company shall take all such actions (including those actions set forth in Section 4.14 ) as may be necessary to provide that the Company Warrant, if and to the extent outstanding immediately prior to the Effective Time, shall be canceled and terminated as of the Effective Time in exchange for the right to receive, without interest thereon, that portion of the Merger Consideration equal to:

(a)           (i) the number of shares of Company Common Stock that would be issuable to the Warrantholder if, immediately prior to the Effective Time, (A) the Company Warrant were to be exercised in full and (B) the shares of Class C Convertible Preferred Stock received upon such exercise were to be converted into Company Common Stock, multiplied by (ii) the Common Price Per Share, less

(b)           the aggregate exercise price of the Company Warrant.

1.8            Cash-Out of Company Vested Options; Termination of Plans .  Prior to the Closing, the Board of Directors of the Company shall adopt such resolutions and take all such other actions as may be necessary to provide that:

(a)           to the extent determined by such Board, the vesting of one or more Company Options shall be accelerated as of immediately prior to the Effective Time, in order that those Company Options shall be included in the Company Vested Options;

(b)           each Company Vested Option shall be canceled and terminated as of the Effective Time in exchange for the right to receive, without interest thereon, that portion of the Merger Consideration equal to (i) the number of shares of Company Common Stock for which such Company Vested Option is exercisable immediately prior to the Effective Time, multiplied by (ii) the Common Price Per Share less   the per share exercise price of such Company Vested Option;

(c)           each Company Option that is not a Company Vested Option shall be canceled and terminated as of the Effective Time in accordance with the applicable Plan; and

(d)           each of the Plans shall be terminated as of the Effective Time.

1.9            Exchange and Payment Procedures .  JPMorgan Chase Bank, N.A. shall serve as the Paying Agent for the Merger (the “ Paying Agent ”).  At the Effective Time, Parent shall make available (y) to the Paying Agent in accordance with this Article I the portion of the Merger Consideration (less the pro rata portion of the Escrow Amount and the Expense Amount) into which the Company Capital Stock converts pursuant to Section 1.6(b) and the portion of the Merger Consideration (less the pro rata portion of the Escrow Amount and the Expense Amount) for which the Company Warrant is exchangeable pursuant to Section 1.7 and (z) to the Surviving Corporation in accordance with this Article I the portion of the Merger Consideration (less the pro rata portion of the Escrow Amount and the Expense Amount) for which the Company Vested Options are exchangeable pursuant to Section 1.8 .  Each Stockholder, Optionholder, and Warrantholder shall be deemed to have contributed a pro rata portion of the Escrow Amount attributable to the Merger Consideration to the Escrow Fund and a pro rata portion of the Expense Amount attributable to the Merger Consideration to the Expense Fund.

(a)            Company Capital Stock .  Upon surrender by a Stockholder to the Paying Agent of one or more certificates that represented shares of Company Capital Stock converted pursuant to Section 1.6(b) (“ Company Stock Certificates ”), together with a letter of transmittal prepared by the Company (which shall specify that delivery shall be effected, and risk of loss and title to the Company Stock Certificates shall pass, only upon delivery of the Company Stock Certificates to the Paying Agent and shall have such other provisions as Parent may reasonably specify) (a “ Letter of Transmittal ”), duly completed and validly executed in accordance with the instructions thereto, the Paying Agent shall pay to such Stockholder, in exchange for such Company Stock Certificates, cash in an amount equal to that portion of the Merger Consideration to which such Stockholder is entitled pursuant to Section 1.6(b) (less the portion of such cash amount to be deposited in the Escrow Fund and the Expense Fund on such Stockholder’s behalf pursuant to Section 7.6 ), and each Company Stock Certificate so surrendered shall be cancelled as of the later of (x) the date of such surrender and (y) the Effective Time.  Each payment to a Stockholder pursuant to the preceding sentence with respect to a properly surrendered Company Stock Certificate shall be made (i) within two Business Days after the later of the Closing Date and the receipt by the Paying Agent of such Company Stock Certificate and (ii) by check mailed to the address of such Stockholder specified in the Letter of Transmittal delivered with such Company Stock Certificate, except that any payment in excess of $1,000,000 shall be made by wire transfer of immediately available funds to the account designated by such Stockholder in such Letter of Transmittal.

(b)            Company Vested Options .  Prior to the Effective Time, the Company shall send to each Optionholder any necessary instructions for effecting the cancellation of Company Vested Options in exchange for a portion of the Merger Consideration in accordance with Section 1.8 , which instructions shall include a request for a release (in a form reasonably acceptable to Parent) confirming that such Optionholder has no right to receive any other capital stock or capital stock-equivalents from the Company, including under any employment agreement or Plan.  Upon compliance by such Optionholder with any Company instructions for effecting the cancellation of Company Vested Options, the Surviving Corporation shall pay to such Optionholder, in exchange for the agreement representing such Company Vested Options, cash in an amount equal to that portion of the Merger Consideration that such Optionholder has the right to receive pursuant to Section 1.8 (less the portion of such cash amount to be deposited in the Escrow Fund and the Expense Fund on such Optionholder’s behalf pursuant to Section 7.6 ).  Each payment to a Optionholder pursuant to the preceding sentence with respect to a properly surrendered agreement representing Company Vested Options shall be made (i) within two Business Days after the later of the Closing Date and the receipt by the Company of such agreement and (ii) by check mailed to the address specified by such Optionholder in accordance with the instructions provided by the Company or through the Surviving Corporation’s payroll system.

(c)            Company Warrant .  Prior to the Effective Time, the Company shall send to the Warrantholder any necessary instructions for effecting the cancellation of the Company Warrant in exchange for a portion of the Merger Consideration in accordance with Section 1.7 , which instructions shall include a request for a release (in a form reasonably acceptable to Parent) confirming that the Warrantholder has no right to receive any other capital stock or capital stock-equivalents from the Company.  Upon compliance by the Warrantholder with any Company instructions for effecting the cancellation of the Company Warrant, or, if the Warrantholder has executed and delivered the Warrant Termination Agreement, upon surrender to the Paying Agent of such Warrant Termination Agreement, the Paying Agent shall pay to the Warrantholder, in exchange for the Company Warrant, cash in an amount equal to that portion of the Merger Consideration that the Warrantholder has the right to receive pursuant to Section 1.7 (less the portion of such cash amount to be deposited in the Escrow Fund and the Expense Fund on the Warrantholder’s behalf pursuant to Section 7.6 ).  The payment to the Warrantholder pursuant to the preceding sentence shall be made (i) within two Business Days after the later of the Closing Date and the receipt by the Company of the Company Warrant and (ii) by wire transfer of immediately available funds to the account designated by the Warrantholder in the Warrant Termination Agreement, or if the Warrantholder has not executed and delivered the Warrant Termination Agreement, in   accordance with the instructions provided by the Company

(d)            Rights Until Surrendered .  Until surrendered in accordance with this Section 1.9 , each outstanding Company Stock Certificate, each Company Vested Option and the Company Warrant will be deemed from and after the Effective Time, for all corporate purposes, to evidence the right to receive the applicable portion of the Merger Consideration payable pursuant to Sections 1.6(b) , 1.7 and 1.8 .

(e)            No Liability .  Notwithstanding anything to the contrary in this Section 1.9 , neither the Paying Agent, the Surviving Corporation, nor any party hereto shall be liable to a Stockholder, an Optionholder or the Warrantholder for any amount properly paid to a public official pursuant to any applicable abandoned property, escheat or similar law.

(f)            Withholding Taxes .  The Company and, on its behalf, Parent, the Paying Agent and the Surviving Corporation shall be entitled to deduct and withhold from any Merger Consideration otherwise payable or deliverable pursuant to this Agreement to any Stockholder, any Optionholder or the Warrantholder such amounts as may be required to be deducted or withheld therefrom under any provision of federal, state, local or foreign Tax law or under any other applicable legal requirement of a Governmental Entity.  To the extent such amounts are so deducted or withheld, such amounts shall be treated for all purposes under this Agreement as having been paid to the Person to whom such amounts would otherwise have been paid.

(g)            No Further Ownership Rights .  The portion of the Merger Consideration paid in respect of the conversion of shares of Company Capital Stock or in exchange for Company Vested Options or the Company Warrant, and the deposit of the related pro rata Escrow Amount into the Escrow Fund and the related pro rata Expense Amount into the Expense Fund in accordance with the terms hereof, shall be deemed to be full satisfaction of all rights pertaining to such shares of Company Capital Stock, such Company Vested Options and the Company Warrant (as the case may be), and there shall be no further registration of transfers on the records of the Surviving Corporation of shares of Company Capital Stock which were outstanding immediately prior to the Effective Time.  If, after the Effective Time, Company Stock Certificates or agreements representing Company Vested Options or the Company Warrant are presented to the Surviving Corporation for any reason, they shall be canceled and exchanged as provided in this Section 1.9 .

(h)            Lost, Stolen or Destroyed Certificates .

(i)           In the event any Company Stock Certificate shall have been lost, stolen or destroyed, the Paying Agent shall pay to the record holder of such Company Stock Certificate the Merger Consideration into which the shares of Company Capital Stock represented by such Company Stock Certificate have been converted pursuant to Section 1.6(b) , upon the making of an affidavit of that fact by such record holder.

(ii)           In the event the Company Warrant shall have been lost, stolen or destroyed, the Paying Agent shall pay to the Warrantholder the Merger Consideration for which the Company Warrant is exchangeable pursuant to Section 1.7 , upon the making of an affidavit of that fact by the Warrantholder.

(iii)           In the event any agreement representing Company Vested Options shall have been lost, stolen or destroyed, the Surviving Corporation shall pay to the holder of such Company Vested Options the Merger Consideration for which such Company Vested Options are exchangeable pursuant to Section 1.8 , upon the making of an affidavit of that fact by such holder.

(iv)           Notwithstanding the foregoing, Parent may, in its discretion and as a condition precedent to the payment of any such Merger Consideration pursuant to the preceding clauses (i), (ii) and (iii), require the holder to provide an indemnification agreement with respect to the lost certificate in form and substance reasonably acceptable to Parent, against any claim that may be made against Parent, the Surviving Corporation or the Paying Agent with respect to a Company Stock Certificate, the Company Warrant or agreement representing Company Vested Options.

1.10            Rounding Adjustments .  The amount of cash into which shares of Company Capital Stock held by a Stockholder are convertible pursuant to Section 1.6(b) , the amount of cash for which the Company Warrant is convertible pursuant to Section 1.7 and the amount of cash for which Company Vested Options held by an Optionholder are exchangeable pursuant to Section 1.8 shall be subject to rounding by the Company to the nearest one cent, in connection with the preparation of the Paying Agent Spreadsheet and the Optionholder Spreadsheet, in order that the amount of cash into which all Company Capital Stock is convertible and for which all Company Vested Options and the Company Warrant are exercisable shall, in the aggregate, equal the Merger Consideration.  In addition, the amount of Merger Consideration paid to, and the amounts deposited in the Escrow Fund and the Expense Fund on behalf of, a Stockholder, an Optionholder or the Warrantholder pursuant to Section 1.9 shall be subject to rounding by the Company to the nearest one cent, in connection with the preparation of the Paying Agent Spreadsheet and the Optionholder Spreadsheet, in order that the amounts of cash deposited pursuant to the Escrow Agreement on behalf of all Stockholders, all Optionholders and the Warrantholder shall result in (a) an aggregate amount equal to $29,000,000.00 being deposited in the Escrow Fund and (b) an aggregate amount of $1,000,000.00 being deposited in the Expense Fund.

1.11            Taking of Necessary Action; Further Action .  If at any time after the Effective Time, any further action is necessary or desirable to carry out the purposes of this Agreement and to vest the Surviving Corporation with full right, title and possession to all assets, property, rights, privileges, powers and franchises of the Company, Parent, Merger Sub, and the officers and directors of the Company, Parent and Merger Sub are fully authorized in the name of their respective corporations to take, and will take, all such lawful and necessary action, so long as such action is not inconsistent with this Agreement.

Except as set forth in the Disclosure Schedule, the Company hereby represents and warrants to Parent and Merger Sub, as set forth in this Article II .  The Disclosure Schedule shall be arranged to correspond to the representations and warranties in Article II , and the disclosure in any portion of the Disclosure Schedule shall qualify the corresponding provision in this Article II and any other provision of this Article II to which it is reasonably apparent on its face that such disclosure relates.

2.1            Organization of the Company .  The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware.  The Company has all requisite corporate power to own its properties and assets and to carry on its business as currently conducted and as currently contemplated to be conducted.  The Company is duly qualified or licensed to do business and in good standing as a foreign corporation in each jurisdiction in which the character or location of its assets or properties (whether owned, leased or licensed) or the nature of its business make such qualifications necessary, except where failures to be so qualified, licensed or in good standing would not, in the aggregate, reasonably be expected to have a material effect on the ability of the Company and its Subsidiaries to operate in the Ordinary Course.  Each such jurisdiction in which the Company is so qualified or licensed and is in good standing is set forth in Section 2.1 of the Disclosure Schedule.  The Company has delivered a true and correct copy of its certificate of incorporation, as amended to date (the “ Certificate of Incorporation ”), and bylaws, as amended to date, each in full force and effect on the date hereof (collectively, the “ Charter Documents ”), to Parent.   Section 2.1 of the Disclosure Schedule lists the directors and officers of the Company as of the date hereof.  The operations now being conducted by the Company are not now and have never been conducted by the Company under any other name.   Section 2.1 of the Disclosure Schedule also lists every state or foreign jurisdiction in which the Company has employees or facilities.

2.2            Company Capital Structure .

(a)           The authorized capital stock of the Company consists of 43,305,513 shares of Company Capital Stock consisting of (i) 30,000,000 shares of common stock, $0.001 par value per share (“ Company Common Stock ”), of which 3,107,934 shares are issued and outstanding; (ii) 249,492 shares designated as class A convertible preferred stock, $0.001 par value per share (“ Class A Convertible Preferred Stock ”), of which 249,490 shares are issued and outstanding; (iii) 7,185,658 shares designated as class B convertible preferred stock, $0.001 par value per share (“ Class B Convertible Preferred Stock ”), all of which are issued and outstanding; and (iv) 5,870,363 shares designated as class C convertible preferred stock, $0.001 par value per share (“ Class C Convertible Preferred Stock ” and collectively with the Class A Convertible Preferred Stock and Class B Convertible Preferred Stock, the “ Preferred Stock ”), of which 5,633,998 shares are issued and outstanding.  The Company has no other capital stock authorized, issued or outstanding.  The rights, privileges and preferences of the Preferred Stock are as stated in the Charter Documents.  The Company Capital Stock is held by the Stockholders in the amounts set forth in Section 2.2(a) of the Disclosure Schedule.  The Stockholders identified as “Key Stockholders” in Section 2.2(a) of the Disclosure Schedule (the “ Key Stockholders ”) hold shares of Company Capital Stock representing, in the aggregate, in excess of 87.5% of the Company Capital Stock on an as-converted basis, as of the date hereof.  All outstanding shares of Company Capital Stock have been duly authorized, are validly issued, fully paid and nonassessable and are not subject to preemptive rights created by statute, the Charter Documents, or any Contract to which the Company is a party or by which it is bound.  No Stockholder has exercised any right of redemption, if any, and the Company has not received notice that any Stockholder intends to exercise such rights.  There are no declared or accrued but unpaid dividends with respect to any shares of Company Capital Stock.  Neither the Company nor any of its Subsidiaries owns any issued shares of Company Capital Stock.  None of the outstanding Company Capital Stock or other securities of the Company was issued in violation of any applicable state, federal or foreign securities laws.

(b)           Except for the Plans, the Company has never adopted, sponsored or maintained any stock option plan or any similar plan providing for the issuance of equity securities to any employees or directors of, or consultants to, the Company or any of its Subsidiaries.   Section 2.2(b) of the Disclosure Schedule sets forth, for each outstanding Company Option, the name of the individual holding such Company Option, the domicile address of such holder, the number of shares of Company Common Stock issuable upon the exercise of such Company Option, the exercise price of such Company Option, whether such Company Option is intended to qualify as an incentive stock option as defined in Section 422 of the Code, and whether such Company Option is a Company Vested Option.   Section 2.2(b) of the Disclosure Schedule also identifies each Company Vested Option for which vesting was accelerated in connection with the transactions contemplated by this Agreement, other than pursuant to contractual rights in existence as of September 15, 2009 (each an “ Accelerated Company Vested Option ”).  Each outstanding Company Option was granted with an exercise price per share equal to or greater than fair market value (as such term is used in Code Section 409) and the Department of Treasury regulations and other interpretive guidance issued thereunder) of the shares of Company Common Stock underlying such Company Option on the grant date thereof and was otherwise issued in compliance with all applicable laws.  The Company Warrant (a true and complete copy of which has been made available to Parent prior to the date hereof) is held by the Warrantholder and 236,364 shares of Class C Convertible Preferred Stock may be acquired upon exercise of the Company Warrant at an exercise price of $1.65 per share.

(c)           Except for the Company Options (which shall terminate pursuant to Section 1.8 ) and the Company Warrant (which shall terminate pursuant to Section 1.7 ) and except as contemplated by this Agreement, there are no options, warrants, calls, rights (including any stock appreciation, phantom stock, profit participation or other similar rights), convertible securities or other Contracts of any character, written or oral, to which the Company is a party or by which the Company is bound obligating the Company to issue, deliver, sell, repurchase or redeem, or cause to be issued, delivered, sold, repurchased or redeemed, any shares of Company Capital Stock or obligating the Company to grant, extend, accelerate the vesting of, change the price of, otherwise amend or enter into any such option, warrant, call, right, convertible security or other Contract.  There are no outstanding debt securities of the Company.  There are no voting trusts, proxies, or other agreements or understandings with respect to the voting stock of the Company or voting by a director of the Company.  There are no Contracts to which the Company is a party relating to the registration, sale or transfer (including agreements relating to rights of first refusal, co-sale rights or “drag-along” rights) of any Company Capital Stock.

2.3            Anti-takeover Statutes .  No anti-takeover or similar statute or regulation under Delaware Law applies to any of the transactions contemplated by this Agreement.  No other “control share acquisition,” “fair price,” “moratorium” or similar anti-takeover laws or regulations enacted under Delaware Law apply to this Agreement or any of the transactions contemplated hereby.

2.4            Subsidiaries .

(a)            Section 2.4 of the Disclosure Schedule sets forth for each Subsidiary of the Company (a) its name and jurisdiction of incorporation or other formation, (b) the number of authorized shares for each class of its capital stock, and (c) the number of issued and outstanding shares of each class of its capital stock, the names of the holders thereof, and the number of shares held by each holder.  Neither the Company nor any of its Subsidiaries owns or has any right to acquire, directly or indirectly, any outstanding capital stock of, or other equity interests in, any Person other than a Subsidiary of the Company.

(b)           All of the issued and outstanding equity securities of each Subsidiary of the Company have been duly authorized and are validly issued, fully paid and nonassessable.  The Company holds of record and beneficially all of the outstanding equity securities of each Subsidiary of the Company free and clear of any and all Liens.  None of the issued and outstanding capital stock of any of the Subsidiaries of the Company has been issued in violation of any preemptive rights or applicable law.  There are no outstanding (i) securities of any Subsidiary of the Company convertible into, or exchangeable or exercisable for any of the capital stock of such Subsidiary, (ii) options, warrants to purchase or subscribe, or other rights to acquire from any Subsidiary of the Company any capital stock or other equity securities or securities convertible into or exchangeable or exercisable for capital stock or other equity securities of such Subsidiary, or rights of first refusal or first offer relating to any capital stock or other equity securities of any Subsidiary of the Company, or (iii) bonds, debentures, notes or other indebtedness or debt securities of any Subsidiary of the Company having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matters on which stockholders of such Subsidiary may vote.  Each Subsidiary of the Company is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization.  Each Subsidiary of the Company has all requisite corporate power to own its properties and assets and to carry on its business as currently conducted and as currently contemplated to be conducted.  Each Subsidiary of the Company is duly qualified or licensed to do business and in good standing as a foreign corporation in each jurisdiction in which the character or location of its assets or properties (whether owned, leased or licensed) or the nature of its business make such qualifications necessary.  The Company has delivered a true and correct copy of each of its Subsidiaries’ charter documents, as amended to date (the “ Subsidiary Charter Documents ”), each in full force and effect on the date hereof, to Parent.

2.5            Authority .  The Company has all requisite corporate power to enter into this Agreement and to consummate the transactions contemplated hereby.  Subject only to the approval of this Agreement and the Merger by the Stockholders, the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of the Company.  The Company’s Board of Directors has (a) unanimously approved and declared the advisability of this Agreement and the transactions contemplated hereby and (b) unanimously resolved to recommend approval and adoption of this Agreement and the approval of the Merger by the Stockholders.  This Agreement has been duly executed and delivered by the Company and constitutes the valid and binding obligation of the Company enforceable against it in accordance with its terms, except as such enforceability may be limited by principles of public policy and subject to the laws of general application relating to bankruptcy, insolvency and the relief of debtors and rules of law governing specific performance, injunctive relief or other equitable remedies.

2.6            No Conflict .  The execution and delivery by the Company of this Agreement do not, and the consummation of the transactions contemplated hereby will not, contravene, conflict with or result in any violation of or default under (with or without notice or lapse of time, or both) or give rise to a right of termination, cancellation, modification or acceleration of any obligation or loss of any benefit or result in the creation or imposition of any Lien under (any such event, a “ Conflict ”) (i) any provision of the Charter Documents or Subsidiary Charter Documents, (ii) any Material Contract, or (iii) any judgment, injunction, order, decree, statute, law, ordinance, rule or regulation applicable to the Company or any of its properties (whether tangible or intangible) or assets.

2.7            Consents .  No consent, notice, waiver, approval, order or authorization of, or registration, declaration or filing with, any court, administrative agency or commission or other federal, state, county, local or other foreign governmental authority, instrumentality, agency or commission (each, a “ Governmental Entity ”), or any other third party, is required to be made, or obtained by the Company in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby, except for (i) such consents, notices, waivers, approvals, orders, authorizations, registrations, declarations and filings as may be required under the HSR Act and any other antitrust or other competition laws of other jurisdictions and (ii) the filing of the Certificate of Merger with the Delaware Secretary of State.

2.8            Company Financial Statements .

(a)            Section 2.8 of the Disclosure Schedule sets forth the Company’s (i) audited consolidated balance sheet as of December 31, 2008, and the related consolidated statement of operations, consolidated statement of redeemable convertible preferred stock and stockholders’ deficit and comprehensive income (loss), and consolidated statement of cash flows for the year ended December 31, 2008, with the corresponding report of PricewaterhouseCoopers LLP, the Company’s independent registered public accounting firm (the “ Company’s Auditors ”) (the “ Year-End Financials ”), and (ii) unaudited consolidated balance sheet as of June 30, 2009 (the “ Balance Sheet Date ”), and the related consolidated statement of operations, consolidated statement of redeemable convertible preferred stock and stockholders’ deficit and comprehensive income (loss), and consolidated statement of cash flows for the six-months ended June 30, 2009 (the “ Interim Financials ”).  The Year-End Financials and the Interim Financials (collectively, the “ Financials ”) and have been prepared in accordance with GAAP applied on a consistent basis throughout the periods involved (except as may be indicated in the notes to the Financials, except that the Interim Financials do not contain footnotes and other presentation items that may be required by GAAP).  The Financials present fairly in all material respects the Company’s consolidated financial position as of the dates indicated and its consolidated operating results and cash flows for the periods indicated, subject in the case of the Interim Financials to normal year-end adjustments, which are not material in amount or significance in any individual case or in the aggregate.  The Company’s unaudited consolidated balance sheet as of the Balance Sheet Date is referred to hereinafter as the “ Current Balance Sheet .”

(b)           There are no “off balance sheet” arrangements (as defined in Item 303(c) of Regulation S-K of the Securities and Exchange Commission) effected by the Company or its Subsidiaries.  The Company’s Auditors, which has expressed its opinion with respect to the Year-End Financials (including the related notes), is and has been throughout the periods covered by such financial statements (y) a registered public accounting firm (as defined in Section 2(a)(12) of the Sarbanes-Oxley Act of 2002) and (z) “independent” with respect to the Company within the meaning of Regulation S-X of the Securities and Exchange Commission.

(c)           Since December 31, 2008, (i) neither the Company, any of its Subsidiaries, nor any director, officer, employee, auditor, accountant or representative of the Company or its Subsidiaries, has received or otherwise had or obtained knowledge of any material complaint, allegation, assertion or claim, whether written or oral, regarding the accounting or auditing practices, procedures, methodologies or methods of the Company or its Subsidiaries, or its internal accounting controls, including any material complaint, allegation, assertion or claim that the Company or its Subsidiaries has engaged in questionable accounting or auditing practices, and (ii) no attorney representing the Company or its Subsidiaries, whether or not employed by the Company or its Subsidiaries, has reported evidence of a violation of securities laws, breach of fiduciary duty or similar violation by the Company or its Subsidiaries or any of their officers, directors, employees or agents to the Board of Directors of the Company or its Subsidiaries or any committee thereof or to any director or officer of the Company or its Subsidiaries.

2.9            Internal Controls .  Except as set forth in Section 2.9 of the Disclosure Schedule, the Company and its Subsidiaries maintain, and since January 1, 2006 have maintained, accurate books and records reflecting their consolidated assets and liabilities and maintain proper and adequate internal accounting controls which provide assurance that (i) transactions are executed with management’s authorization; (ii) transactions are recorded as necessary to permit preparation of the consolidated financial statements of the Company and to maintain accountability for the Company’s consolidated assets; (iii) access to the Company’s consolidated assets is permitted only in accordance with management’s authorization; (iv) the reporting of the Company’s consolidated assets is compared with existing assets at regular intervals; and (v) accounts, notes and other receivables and inventory are recorded accurately, and proper and adequate procedures are implemented to effect the collection thereof on a current and timely basis.

2.10            No Undisclosed Liabilities .  (i) Neither the Company nor any of its Subsidiaries has any liability, indebtedness, obligation, expense, claim, deficiency, guaranty or endorsement of any type or kind whatsoever, whether accrued, absolute, contingent, determined, determinable, matured, unmatured or otherwise (whether or not required to be reflected in financial statements in accordance with GAAP), and (ii) to the Knowledge of the Company, there is no existing condition, situation or set of circumstances which could reasonably be expected to result in such liability, which, individually or in the aggregate, in the case of clause (i) or (ii) of this Section 2.10 (x) exceeds $250,000 individually or $500,000 in the aggregate, (y) has not been reflected in the Current Balance Sheet (if required by GAAP to be so reflected), or (z) has not arisen in the Ordinary Course since the Balance Sheet Date and prior to the date hereof.

2.11            No Changes .  Except as contemplated by this Agreement, from the Balance Sheet Date through the date hereof, the Company and its Subsidiaries have operated their business only in the Ordinary Course and there has not been, occurred or arisen any:

(a)           amendment or change to the Charter Documents or the Subsidiary Charter Documents;

(b)           amendment of any term of any outstanding security of the Company or its Subsidiaries, other than amendments of vesting periods of the Accelerated Company Vested Options in contemplation of this Agreement and the transactions contemplated hereby;

(c)           expenditure or transaction with a monetary commitment by the Company or its Subsidiaries exceeding $100,000 individually or $500,000 in the aggregate with respect to any single Person;

(d)           settlement, discharge, waiver, release or satisfaction of any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise of the Company or its Subsidiaries) exceeding $100,000 individually or $500,000 in the aggregate with respect to any single Person, other than any such settlement, discharge, waiver, release or satisfaction entered into in the Ordinary Course on terms that were consistent in all material respects with previously existing Contract provisions;

(e)           destruction of, damage to, or loss of any assets (whether tangible or intangible) of the Company or its Subsidiaries, resulting in a loss of more than $75,000 (whether or not covered by insurance);

(f)           material employment dispute, including claims or matters raised by any individuals or any workers’ representative organization, bargaining unit or union regarding labor trouble or claim of wrongful discharge or other unlawful employment or labor practice or action with respect to the Company or its Subsidiaries;

(g)           change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by the Company or its Subsidiaries other than as required by GAAP;

(h)           change in any material election in respect of Taxes, adoption or change in any accounting method in respect of Taxes, agreement or settlement of any claim or assessment in respect of Taxes, or extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes by the Company or any of its Subsidiaries;

(i)           revaluation by the Company or its Subsidiaries of any asset (whether tangible or intangible), including writing down the value of inventory or writing off a note or an accounts receivable, in an amount exceeding $75,000;

(j)           declaration, setting aside or payment of a dividend or other distribution (whether in cash, stock or property) in respect of any Company Capital Stock, or any split, combination or reclassification in respect of any shares of Company Capital Stock, or any issuance or authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock, or any direct or indirect repurchase, redemption, or other acquisition by the Company or its Subsidiaries of any shares of Company Capital Stock (or options, warrants or other rights convertible into, exercisable or exchangeable therefor);

(k)           material increase in the salary or other compensation payable or to become payable by the Company or its Subsidiaries to any officer, director or employee, or the declaration, payment, commitment or obligation of any kind for the payment (whether in cash or equity) by the Company or its Subsidiaries of a severance payment, termination payment or special bonus to any such officer, director or employee;

(l)           entry into (or termination, extension, amendment or modification of the terms of) any Contract to which the Company or its Subsidiaries is a party or by which they or any of their assets (whether tangible or intangible) are bound, other than Contracts entered into in the Ordinary Course;

(m)           sale, lease, license or other disposition of any of the assets (whether tangible or intangible) or properties of the Company or its Subsidiaries, including the sale of any accounts receivable of the Company or its Subsidiaries, or any creation of any security interest in such assets or properties, other than any such disposition made in the Ordinary Course or involving receipt of less than $100,000;

(n)           loan by the Company or its Subsidiaries to any Person, purchase by the Company or its Subsidiaries of any debt securities of any Person, or capital contributions to investment in any Person;

(o)           creation or other incurrence by the Company or its Subsidiaries of any Lien on any of their assets;

(p)           incurring by the Company or any of its Subsidiaries of any indebtedness for borrowed money, amendment of the terms of any outstanding loan agreement, guaranteeing by the Company or its Subsidiaries of any such indebtedness, issuance or sale of any debt securities of the Company or its Subsidiaries or guaranteeing of any debt securities of others;

(q)           commencement or settlement of any lawsuit by the Company or its Subsidiaries, or commencement, settlement, written notice or, to the Knowledge of the Company, threat of any lawsuit or proceeding or other investigation against the Company or its Subsidiaries or their affairs;

(r)           notice of any claim or potential claim of ownership, interest or right by any Person other than the Company or its Subsidiaries in or to the Intellectual Property owned by the Company or its Subsidiaries or of infringement by the Company or its Subsidiaries of any other Person’s Intellectual Property;

(s)           issuance, grant, delivery or sale by the Company of any shares of Company Capital Stock or securities convertible into, or exercisable or exchangeable for, shares of Company Capital Stock, or any securities, warrants, options or rights to purchase any of the foregoing, other than shares of Company Common Stock issued upon exercise of options outstanding as of the Balance Sheet Date;

(t)           (i) sale or license of any Intellectual Property owned by the Company or its Subsidiaries or execution of any Contract with respect to Intellectual Property owned or exclusively licensed by the Company or its Subsidiaries with any Person, other than any such sale or license entered into in the Ordinary Course, (ii) purchase or license of any Intellectual Property or execution of any Contract with respect to the Intellectual Property of any Person, other than in connection with a purchase or license of “off-the-shelf” software, (iii) Contract with respect to the development of any Intellectual Property with a third party, (iv) material change in pricing or royalties set or charged by the Company or its Subsidiaries to its customers or licensees, or (v) material change in pricing or royalties set or charged by Persons who have licensed Intellectual Property to the Company or its Subsidiaries;

(u)           Contract or modification to any Contract pursuant to which any other party was granted marketing, distribution, development, manufacturing or similar rights of any type or scope with respect to any Company Products or any Intellectual Property of the Company, in each case other than in the Ordinary Course;

(v)           event, occurrence, development, state of circumstances, facts, or condition of any character that has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect with respect to the Company and its Subsidiaries taken as a whole;

(w)           any Contract to purchase or sell any interest in real property, grant any Lien on any real property, enter into any lease, sublease, license or other occupancy agreement with respect to any real property or alter, amend, modify or terminate any of the terms of any Lease Agreement;

(x)           acquisition of or Contract to acquire by merging or consolidating with, or by purchasing all or substantially all of the assets or equity securities of, or by any other manner, any business or corporation, partnership, association or other business organization or division thereof, or other acquisition of or Contract to acquire, other than in the Ordinary Course, assets or equity securities that are or would be material, individually or in the aggregate, to the business of the Company and its Subsidiaries;

(y)           cancellation, amendment or renewal of any insurance policy; and

(z)           agreement by the Company or its Subsidiaries, or any officer or employee on behalf of the Company or its Subsidiaries, to do any of the things described in the preceding clauses (a) through (x) of this Section 2.11 .

2.12            Accounts Receivable .   Section 2.12 of the Disclosure Schedule lists all accounts receivable of the Company and its Subsidiaries as of the Balance Sheet Date, together with an aging schedule indicating a range of days elapsed since invoice.

2.13            Tax Matters .

(a)            Definition of Taxes .  For the purposes of this Agreement, the term “ Tax ” or, collectively, “ Taxes ” shall mean (i) any and all federal, state, local and foreign Taxes, assessments and other governmental charges, duties, impositions and liabilities, including, but not limited to, Taxes based upon or measured by gross receipts, income, profits, sales, use and occupation, and value added, ad valorem, transfer, franchise, withholding, payroll, recapture, employment, excise and property Taxes as well as public imposts, fees and social security charges (including, but not limited to, health, unemployment, workers’ compensation and pension insurance), together with all interest, penalties and additions imposed with respect to such amounts, (ii) any liability for the payment of any amounts of the type described in clause (i) of this Section 2.13(a) as a result of being a member of an affiliated, consolidated, combined or unitary group for any period, and (iii) any liability for the payment of any amounts of the type described in clauses (i) or (ii) of this Section 2.13(a) as a result of any express or implied obligation to indemnify any other Person or as a result of any obligation under any Contract with any other Person with respect to such amounts and including any liability for Taxes of a predecessor entity.

(b)            Tax Returns and Audits .

(i)           The Company and its Subsidiaries have (a) prepared and timely filed all federal, state, local and foreign returns, estimates, information statements and reports required to be filed (“ Returns ”) relating to any and all Taxes concerning or attributable to the Company or its Subsidiaries or their operations and such Returns are true and correct and have been or will be completed in accordance with applicable law, and (b) timely paid in full all Taxes due and payable by the Company and its Subsidiaries.

(ii)           The Company and its Subsidiaries have withheld or paid to the appropriate authorities or depositories, with respect to their employees and other third parties, all federal, state and foreign income taxes and social security charges and similar fees, Federal Insurance Contribution Act, Federal Unemployment Tax Act and other Taxes required to be so withheld or paid.

(iii)           Neither the Company nor its Subsidiaries is now delinquent in the payment of any Tax, nor is there any Tax deficiency outstanding, assessed or, to the Knowledge of the Company, proposed against the Company or its Subsidiaries.  The Company and its Subsidiaries have not executed any waiver of any statute of limitations (that has not expired) extending the period for the assessment or collection of any Tax.

(iv)           To the Knowledge of the Company, no audit or other examination of any Return of the Company or its Subsidiaries is currently in progress, nor has the Company or its Subsidiaries been notified in writing of any request for such an audit or other examination that remains outstanding as of the date hereof.

(v)           Neither the Company nor its Subsidiaries had any liability for unpaid Taxes as of the Balance Sheet Date that were not accrued or reserved on the Current Balance Sheet, whether asserted or unasserted, contingent or otherwise, and the Company and its Subsidiaries have not incurred any liability for Taxes since the Balance Sheet Date other than in the Ordinary Course.

(vi)           The Company and its Subsidiaries have provided or made available to Parent or its legal counsel copies of all material Returns (as listed in Section 2.13(b)(vi) of the Disclosure Schedule) filed for all periods since January 1, 2004.

(vii)           There are (and immediately following the Effective Time there will be) no Liens on the assets of the Company or its Subsidiaries relating to or attributable to Taxes.  The Company has no Knowledge of any basis for the assertion of any claim relating or attributable to Taxes, which, if adversely determined, would result in any Lien on the assets of the Company.

(viii)           None of the Company’s assets is treated as “tax exempt use property,” within the meaning of Section 168(h) of the Code.

(ix)           Neither the Company nor its Subsidiaries have (a) ever been (1) a member of an affiliated group (within the meaning of Code §1504(a)) filing a consolidated federal income Tax Return (other than a group of which the Company was the common parent), (2) a party to any Tax sharing, indemnification or allocation Contract, or (3) a party to any joint venture, partnership, limited liability company or other arrangement that could be treated as a partnership for Tax purposes or (b) liability for the Taxes of any Person (other than Company or its Subsidiaries), under Treasury Regulation § 1.1502-6 (or any similar provision of state, local or foreign law), as a transferee or successor, by Contract or otherwise.

(x)           The Company’s and its Subsidiaries’ Tax basis in their assets for purposes of determining their future amortization, depreciation and other income Tax deductions is accurately reflected on their Tax Books and Records.

(xi)           The Company is not and has not been, at any time, a “United States Real Property Holding Corporation” within the meaning of Section 897(c)(2) of the Code.

(xii)           No adjustment relating to any Return that has been filed by the Company or its Subsidiaries and for which the period for the making of such adjustment has not expired by the application of a statute of limitation, has been proposed in writing to the Company by any Tax authority.

(xiii)           Neither the Company nor its Subsidiaries have constituted either a “distributing corporation” or a “controlled corporation” in a distribution of stock intended to qualify for tax free treatment under Section 355 of the Code (x) in the two years prior to the date of this Agreement or (y) in a distribution which could otherwise constitute part of a “plan” or “series of related transactions” (within the meaning of Section 355(e) of the Code) in conjunction with the Merger.

(xiv)           Neither the Company nor its Subsidiaries have engaged in a transaction that is the same or substantially similar to one of the types of transactions that the Internal Revenue Service has determined to be a Tax avoidance transaction and identified by notice, regulation, or other form of published guidance as a listed transaction, as set forth in Treasury Regulation Section 1.6011-4(b)(2).

(xv)           Neither the Company nor its Subsidiaries have received written notice of a claim made by a Tax authority in a jurisdiction where it does not currently file Returns that it is or may be subject to Taxation by that jurisdiction.

(xvi)           Neither the Company nor its Subsidiaries has in effect any power of attorney (or similar authority) as to any matters regarding Taxes that will remain in effect as of the Effective Time.

(xvii)           Neither the Company nor its Subsidiaries will be required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of the occurrence or existence of any of the following prior to Closing Date (A) a change in method of accounting for a taxable period (or portion thereof) ending on or prior to the Closing Date, (B) any “closing agreement” as described in Section 7121 of the Code (or any corresponding provision of state, local or foreign Tax law), (C) any intercompany transaction or any excess loss account as described in Treasury Regulation Section 1.1502-19 (or any corresponding provision of state, local or foreign Tax law), (D) any installment sale or open transaction or (E) as a result of any prepaid amount received on or prior to the Closing Date.

(xviii)            Section 2.13(b) of the Disclosure Schedule sets forth, by the Tax years in which they arose, the amounts of any unused United States federal net operating loss or net capital loss allocable to the Company and its Subsidiaries as of December 31, 2008.  Except as described in Section 2.13(b) of the Disclosure Schedule, prior to the Effective Time of the Merger, the Company will not have undergone an “ownership change” under Section 382(g) of the Code.

(xix)           The Company and its Subsidiaries have filed all required Forms 5471 and foreign bank account reporting forms.

2.14            Restrictions on Business Activities .  There is no Contract (non-competition or otherwise), judgment, injunction, order or decree to which the Company or its Subsidiaries is a party which has or would reasonably be expected to have the effect of prohibiting any material business practice of the Company or its Subsidiaries, the conduct of business by the Company or its Subsidiaries in the Ordinary Course, or otherwise limiting the freedom of the Company or its Subsidiaries to engage in any line of business or to compete with any Person.  Without limiting the generality of the foregoing, neither the Company nor any of its Subsidiaries has entered into any Contract under which the Company or its Subsidiaries is restricted from selling, licensing, or otherwise distributing any of their technology or products or from providing services to customers or potential customers or any class of customers, in any geographic area, during any period of time, or in any segment of the market.

2.15            Real Property; Condition of Equipment; Customer Information .

(a)           Neither the Company nor any of its Subsidiaries owns any real property, nor has the Company or its Subsidiaries ever owned any real property.   Section 2.15(a) of the Disclosure Schedule sets forth a list of all real property currently leased, subleased or licensed by or from the Company or its Subsidiaries or otherwise used or occupied by the Company or its Subsidiaries for the operation of the business of the Company and its Subsidiaries (the “ Leased Real Property ”), and, for each parcel of Leased Real Property (other than leases that relate to real property used for the co-location of computer systems), the name of the lessor, licensor, sublessor, master lessor or lessee, the date and term of the lease, license, sublease or other occupancy right and each amendment thereto and, with respect to any current lease, license, sublease or other occupancy right the aggregate annual rental payable thereunder.

(b)           The Company has provided Parent true, correct and complete copies of all lease guaranties, subleases, and Contracts for the leasing, use or occupancy of, or otherwise granting a right in or relating to each Leased Real Property, including all amendments, terminations and modifications thereof that are currently in effect (“ Lease Agreements ”).  All of the Lease Agreements are valid and effective in accordance with their respective terms.  There is not, under any of the Lease Agreements, any existing event of default (or event which with notice or lapse of time, or both, would constitute a default) on the part of the Company or its Subsidiaries, or, to the Knowledge of the Company, any other party thereto.  Since January 1, 2006, neither the Company nor any of its Subsidiaries has received any notice of a default, alleged failure to perform, or any offset or counterclaim with respect to any Lease Agreement, which has not been fully remedied and withdrawn.  The Closing will not affect the Company’s and its Subsidiaries’ continued use and possession of the Leased Real Property for the conduct of business in the Ordinary Course.  The Company or its Subsidiaries enjoy peaceful and undisturbed possession, in all material respects, under each of the Lease Agreements.  There are no other parties occupying, or with a right to occupy, any Leased Real Property.  Neither the Company nor any of its Subsidiaries owes any brokerage commissions or finders fees with respect to any Leased Real Property or would owe any such fees if any existing Lease Agreement were renewed pursuant to any renewal options contained in such Lease Agreement.

(c)           Each Leased Real Property is in good operating condition and repair, free from structural, physical and mechanical defects, ordinary wear and tear excepted, is maintained in a manner consistent with standards generally followed with respect to similar properties, and is otherwise suitable for the conduct of the business of the Company and its Subsidiaries in the Ordinary Course.  To the Knowledge of the Company, the operation of the Company and its Subsidiaries on each Leased Real Property, including the improvements thereon, does not violate in any material respect any applicable building code, zoning requirement or statute relating to such Leased Real Property or operations thereon, and any such non-violation is not dependent on so-called non-conforming use exceptions.

(d)           Each of the Company and its Subsidiaries has good and valid title to, or, in the case of leased properties and assets, valid leasehold interests in, all of its tangible properties and assets, real, personal and mixed, free and clear of any Liens, except as reflected in the Current Balance Sheet.

(e)            Section 2.15(e) of the Disclosure Schedule lists all material items of equipment owned or leased by the Company or its Subsidiaries, and such equipment is (i) adequate for the conduct of the business of the Company and its Subsidiaries in the Ordinary Course, and (ii) in good operating condition, regularly and properly maintained, subject to normal wear and tear.

2.16            Intellectual Property .

(a)           “ Intellectual Property ” means:

(i)           any know-how, invention (whether patentable or unpatentable and whether or not reduced to practice), and improvement to any invention;

(ii)           any trademark, service mark, trade dress, logo, trade name, corporate name, domain name, website, Uniform Resource Locator (URL) or other internet address, telephone or fax number, whether or not registered, together with all goodwill associated therewith and including any translation, adaptation, derivation, or combination;

(iii)           any copyrightable work (including advertising and promotional materials, catalogs, logo designs, software, compilations of data, and website content);

(iv)           any trade secret or confidential or proprietary business information (including any idea, research and development, know-how, formula, composition, manufacturing and production process or technique, technical data, design, layout, plan, proposal, drawing, specification, customer or supplier list, pricing and cost information, specifically including by means of example any technical, business or marketing data, plan or proposal);

(v)           any industrial designs;

(vi)           any mask works;

(vii)           any computer software and systems implemented using software (whether in general release or under planning, research or development), including, without limitation, source code, object code, files, records and databases and all related data and related documentation;

(viii)           any copies or tangible embodiment of any of the foregoing, in whatever form or medium and all files relating thereto.

“ Intellectual Property Rights ” means and includes all rights of the following types, which may exist or be created under the laws of any jurisdiction in the world: (a) rights associated with works of authorship, including exclusive exploitation rights, copyrights, moral rights, and mask works; (b) trademark and trade name rights and similar rights; (c) trade secret rights; (d) patents and industrial property rights; (e) other proprietary rights in Intellectual Property of every kind and nature; and (f) all registrations, renewals, extensions, continuations, divisions, or reissues of, and applications for, any of the rights referred to in clauses (a) through (f) above.

(b)           (i)      The Company or its Subsidiaries own, or are licensed for, and in any event possess sufficient and legally enforceable rights with respect to, all Intellectual Property and Intellectual Property Rights that are used or exploited in, or that are necessary to conduct, the business of the Company and the Subsidiaries as it is conducted as of the date of this Agreement.

(ii)           To their Knowledge, the Company or its Subsidiaries owned, or were licensed for, and in any event possessed sufficient and legally enforceable rights with respect to, all Intellectual Property or Intellectual Property Rights that were used or exploited in the business of the Company and the Subsidiaries at the time they were used or exploited.

(iii)           The Company or its Subsidiaries have all rights necessary to commercially exploit any products or service offerings under development, or contemplated to be developed, as of the date of this Agreement, for commercial release within 12 months of the Closing Date.

(iv)           The Intellectual Property and Intellectual Property Rights described in Sections 2.16(b)(i) and 2.16(b)(iii) are the “ Operationally-Required IP ”.

(v)            Section 2.16(b) of the Disclosure Schedule sets forth, for the Intellectual Property Rights owned by the Company and each of its Subsidiaries, a complete and accurate list of all of the following Intellectual Property Rights of the Company and its Subsidiaries: (1) patents and patent applications, (2) trademark and service mark registrations and applications therefor, (3) unregistered trademarks and service marks, (4) domain names, and (5) copyright registrations and applications therefor; indicating for each, where applicable, (i) the jurisdiction, (ii) the patent, registration, or application number, (iii) the date issued, (iv) the date filed, and (v) the owner of record.  The Intellectual Property Rights that are registered with, applied for from, or specifically granted or cataloged by, a Governmental Entity or other recognized registry, constitute the “ Registered Intellectual Property .”

(vi)            Section 2.16(b) of the Disclosure Schedule also sets forth as of the date of this Agreement a complete and accurate list of all license Contracts granting any right to use or practice any Intellectual Property or Intellectual Property Rights, whether the Company or a Subsidiary is the licensee or licensor thereunder and whether written or otherwise, and any written consent to use, settlement or other Contracts relating to any Intellectual Property or Intellectual Property Rights to which the Company or a Subsidiary is a party or otherwise bound (other than those license Contracts (A) in the form of the Company’s or Subsidiary’s standard form of Contract, including with those modifications generally agreed to by the Company or its Subsidiary in the Ordinary Course, that involves payments to the Company or any of its Subsidiaries of less than $100,000, (B) granting non-exclusive rights to the Company or any Subsidiary to use software or other Intellectual Property on the licensor’s non-negotiated commercial off-the-shelf terms available to licensees in the market generally or (C) confidentiality or nondisclosure Contracts permitting access to the confidential information of the Company or any of its Subsidiaries for review or evaluation and not for productive, commercial use) (collectively (A), (B), and (C), the “ Standard Agreements ”), (collectively, the “ License Agreements ”), indicating for each the title, the parties, and the date executed.

(c)           The Company has delivered, or has caused to be delivered, to the Parent correct, complete, and fully executed copies of all the License Agreements and all ancillary documents pertaining thereto (including, without limitation, all amendments, consents and evidence of commencement dates and expiration dates).  With respect to each of the License Agreements, the Company represents and warrants that as of the date of this Agreement:

(i)           the License Agreements, together with any and all ancillary documents pertaining thereto, subject to the laws of general application relating to bankruptcy, insolvency and the relief of debtors, and rules of law governing specific performance, injunctive relief and other equitable remedies, will continue to be legal, valid, binding, and enforceable and in full force and effect according to its terms on terms identical to those currently in effect immediately upon consummation of the transactions contemplated by this Agreement and the consummation of such transactions will not constitute a breach or default under such License Agreement or otherwise give any party to the License Agreement other than the Company or its Subsidiaries a right to terminate such license;

(ii)           Neither the Company nor any of its Subsidiaries has received any notice of termination or cancellation under such License Agreement, nor any notice evidenced in writing of a breach or default under such License Agreement which has not been cured and neither the Company nor any of its Subsidiaries has sublicensed or granted any of the licensed rights to another party in violation of the License Agreement; and

(iii)           Neither the Company nor any of its Subsidiaries, nor to the Knowledge of the Company any other party to such license, is in breach or default in any material respect and to the Knowledge of the Company, no event has occurred that, with notice or lapse of time would constitute such a breach or default or permit termination, modification, or acceleration under such License Agreement.

(d)            Section 2.16(c) of the Disclosure Schedule contains a complete and accurate list (by name and version number) of all product and service offerings (including software) of the Company and its Subsidiaries that have been offered, licensed, sold, or otherwise been made available in return for consideration, to third parties by the Company or its Subsidiaries since January 1, 2008 (collectively, the “ Company Products ”).

(e)           As of the date of this Agreement, the Company and/or its Subsidiaries, as applicable, have all right, title, and interest in and to the Operationally-Required IP owned by the Company or any of its Subsidiaries, free and clear of any Liens (other than licenses granted in the Ordinary Course) and, for such Intellectual Property or Intellectual Property Rights that are Registered Intellectual Property, the Company and/or one or more of its Subsidiaries is listed in the records of the appropriate federal, state or foreign agency as the sole owner of record for each patent, registration, or application listed on Section 2.16(b) of the Disclosure Schedule.  In each case in which the Company or its Subsidiaries, as applicable, has acquired, other than through a license or other right of use, any Intellectual Property or Intellectual Property Rights from any Person, the Company or its Subsidiaries, as applicable, has obtained a valid and enforceable assignment sufficient to irrevocably transfer all rights in and to such Intellectual Property or Intellectual Property Rights to the Company or its Subsidiaries, as applicable.

(f)           As of the date of this Agreement, the Registered Intellectual Property has not been cancelled, expired, or abandoned, and the Registered Intellectual Property (other than applications for any Registered Intellectual Property) is valid and subsisting, in full force and effect.  No claim evidenced by a writing has been made, asserted, or to the Knowledge of the Company threatened, or is pending against the Company or any of its Subsidiaries based upon, challenging or seeking to deny or restrict the use or exploitation by the Company or any of its Subsidiaries of any of the Intellectual Property or Intellectual Property Rights owned or, to the Knowledge of the Company based on notice from the applicable licensor evidenced by a writing, licensed by the Company or any of it Subsidiaries.  Other than ex parte prosecution of patent, trademark, service mark or copyright applications, there are no proceedings or actions pending before any court or government agency (including the United States Patent and Trademark Office or similar foreign government agencies) related to any of the Registered Intellectual Property owned by Company or its Subsidiaries.  There are no actions that must be taken within 180 days of the date of this Agreement, including the payment of any registration, maintenance or renewal fees or the filing of any response to an official action of a court or government agency (including the United States Patent and Trademark Office or similar foreign government agencies) or the filing of any application for the purpose of obtaining, maintaining, perfecting, preserving or renewing any of the Intellectual Property or Intellectual Property Rights owned by the Company or its Subsidiaries.  Other than a single new product clearance opinion as disclosed to the Parent, neither the Company nor any of its Subsidiaries obtained or possessed at any time (including as of the date of this Agreement) any opinion of counsel relating to any Intellectual Property or Intellectual Property Rights of the Company, its Subsidiaries, or any Person.

(g)           The consummation of the transactions contemplated by this Agreement will not result in the termination or impairment of any of the Intellectual Property or Intellectual Property Rights owned by Company or any of its Subsidiaries and will not require the consent of any Governmental Entity or third party.

(h)           There are no settlements, forbearances to sue, consents, judgments, orders, or similar obligations binding on the Company or any of its Subsidiaries which (1) restrict the Company’s or any of its Subsidiaries’ rights to use any Intellectual Property or Intellectual Property Rights, (2) restrict the Company’s or any of its Subsidiaries’ business in order to accommodate a third party’s Intellectual Property Rights or (3) permit third parties to use any Intellectual Property or Intellectual Property Rights owned by the Company or its Subsidiaries.  Neither the Company nor its Subsidiaries has licensed or sublicensed its Intellectual Property Rights other than pursuant to the License Agreements or the Standard Agreements and no royalties, honoraria or other consideration is payable by the Company or its Subsidiaries for the use of or right to use any Intellectual Property or Intellectual Property Rights except pursuant to the License Agreements or the Standard Agreements.

(i)           To the extent indicated in Section 2.16(b) of the Disclosure Schedule, the Registered Intellectual Property has been duly registered in, filed in, or issued by, the offices indicated in Section 2.16(b) of the Disclosure Schedule.  In each case where a registration or patent or application for registration or patent listed in Section 2.16(b) of the Disclosure Schedule is held by the Company or its Subsidiaries by assignment, the assignment has been duly recorded with the Governmental Entity from which the original registration or patent issued or before which the application for registration or patent is pending.

(j)           To the Knowledge of the Company, no third party is infringing, misappropriating, diluting, or violating any Intellectual Property or Intellectual Property Rights owned by the Company or its Subsidiaries.

(k)           (i) The Company Products, (ii) the conduct of the business of the Company and its Subsidiaries in the Ordinary Course, and (iii) the use or exploitation of the Intellectual Property owned or licensed by the Company and its Subsidiaries as of the date of this Agreement, and (iv) the provision by the Company and/or its Subsidiaries of hosted services, vertical applications, or “software as a service” using the Intellectual Property, the Intellectual Property Rights, and the means, methods, and techniques used by the Company and/or its Subsidiaries as of the date of this Agreement; do not infringe upon, violate, or misappropriate the rights or property of any Person.  No claim is pending or, to the Knowledge of the Company, has been asserted or threatened against the Company or any of its Subsidiaries alleging that any of (i), (ii) or (iii) infringes or misappropriates the rights or property of any Person. «

(l)           Neither the Company nor any of its Subsidiaries has (i) entered into any Contract under which it has, or may have, the obligation to transfer any ownership of, or granted any exclusive license to use or distribute (or entered into any Contract under which it has, or may have, the obligation to grant any exclusive license to use or distribute), or authorized the retention of any exclusive rights to use or joint ownership of, any Intellectual Property or Intellectual Property Rights owned by the Company or any of its Subsidiaries, to any other Person, (ii) other than in a License Agreement or Standard Agreement entered into in the Ordinary Course, entered into any Contract under which it has granted any covenant not to sue, assert or exploit any Intellectual Property Right owned by the Company or any of its Subsidiaries, or (iii) entered into any Agreement under which the Company or any of its Subsidiaries has granted any Person the right to bring a lawsuit for infringement or misappropriation of any Intellectual Property Right owned by the Company or its Subsidiaries.

(m)           All disclosures of the Company’s Intellectual Property maintained by the Company or its Subsidiaries as confidential by the Company and its Subsidiaries or their designees to third parties have been made pursuant to non-disclosure agreements that protect the confidentiality of such Intellectual Property and restrict the use of such Intellectual Property to an identified purpose.  All current and former employees, consultants, and contractors of the Company and its Subsidiaries have executed proprietary information and non-disclosure agreements that protect the confidentiality of such Intellectual Property and restrict the use of such Intellectual Property to an identified purpose. Each current and former employee, consultant, and contractor of the Company who is or was involved in, or who has contributed to, the creation or development of any of the Intellectual Property owned by the Company or its Subsidiaries has executed and delivered (and to the Knowledge of the Company, is in compliance with) an agreement assigning such contribution to the Company or its Subsidiaries. Forms of such agreements have been made available to Parent.

(n)           With respect to each trade secret of the Company or any of its Subsidiaries, the Company and its Subsidiaries have taken reasonable precautions to protect the secrecy, confidentiality, and value of such trade secret during the time period when the Company and its Subsidiaries have intended such trade secret to be kept confidential (including the enforcement by the Company and its Subsidiaries of a policy requiring each employee, consultant, or contractor to execute proprietary information and confidentiality agreements substantially in the Company’s standard form).

(o)           The Company Products that include software and that are currently offered or licensed by the Company and its Subsidiaries are in substantial conformance with all applicable contractual commitments, express and implied warranties, and the documentation and specifications therefor, except only for errors and bugs of the type, scope and nature generally acceptable in the software industry for similar types of software offerings.  The Company and its Subsidiaries have taken reasonable actions customary in the software industry to document the portions of the Company Products developed by the Company or its Subsidiaries and the operation of the Company Products, such that the software developed by the Company or its Subsidiaries, including its source code and documentation, may be understood, modified, and maintained by reasonably competent programmers.

(p)           The Company and its Subsidiaries have the right to use, pursuant to valid licenses or other rights of use, all software development tools, library functions, compilers and all other third-party software that are used by the Company or its Subsidiaries as part of or are necessary to the business of the Company as conducted in the Ordinary Course to create, modify, compile, operate or support any software comprising Intellectual Property owned or exclusively licensed by the Company or any of its Subsidiaries, as applicable, that is incorporated into a Company Product.

(q)           Neither this Agreement nor the transactions contemplated by this Agreement will result in any third party being granted rights or access to, or the placement in, or release from escrow or similar arrangement, any Intellectual Property owned by the Company or any of its Subsidiaries, including source code for any software owned by the Company or any of its Subsidiaries.  Except for disclosures to the employees, consultants, and contractors of the Company or any of its Subsidiaries in the ordinary course of their employment, neither the Company, any of its Subsidiaries, nor any other Person acting on their behalf has disclosed, delivered or licensed to any Person, agreed to disclose, deliver or license to any Person, or permitted the disclosure or delivery to any escrow agent or other Person of, any source code for any software owned by the Company or its Subsidiaries that the Company does not, in the Ordinary Course, provide or make available in source code or human readable form.  No event has occurred, and no circumstance or condition exists, that (with or without notice or lapse of time, or both) will, or would reasonably be expected to, result in the disclosure, delivery or license by the Company, any of its Subsidiaries, or any Person acting on their behalf to any Person of any source code for any software  owned by the Company or its Subsidiaries, except for disclosures to the employees, consultants, and contractors of the Company or any of its Subsidiaries in the ordinary course of their employment and except for source code the Company, in the Ordinary Course, generally provides or makes available in source code or human readable form.   Section 2.16(q) of the Disclosure Schedule identifies each Contract pursuant to which the Company or any of its Subsidiaries has deposited, or is or may be required to deposit, with an escrow holder or any other Person, any source code for any software owned by the Company and/or its Subsidiaries, and describes whether the execution of this Agreement or any of the other transactions contemplated by this Agreement, in and of itself, would reasonably be expected to result in the release from escrow of any Intellectual Property owned by the Company or its Subsidiaries including source code for any software owned by the Company or its Subsidiaries.

(r)           The Company and its Subsidiaries have acted in a commercially reasonable manner (based on standard industry practices and currently-maintained databases) to ensure that the software products and computer-based services of the Company and its Subsidiaries are free of any computer programs, instructions, routines, features, or code intended to adversely affect the operation, integrity, or function of any computer system, computer program (including the software products and computer-based services themselves) or data operated upon, or stored by, any computer system, or that provide unauthorized access to, or use of, computer systems or the data processed by, or stored using, any computer system, including viruses, worms, Trojan horses, time bombs, spyware, and trap doors.   The Company and its Subsidiaries have acted in a commercially reasonable manner to safeguard the information technology systems utilized by the Company and its Subsidiaries in the operation of the business and restrict unauthorized access thereto.

(s)           The Company has obtained a review of the Open Source Materials that are part of the Company Products by a third party and has delivered, or has caused to be delivered, a copy of the report provided by the third party to Parent.  “ Open Source Materials ” means materials (i) subject to any license that requires as a condition of use, modification and/or distribution thereof, that such materials, or materials combined and/or distributed with such materials be (A) disclosed or distributed in source code or similar form, (B) licensed for the purpose of making derivative works, or (C) redistributable at no charge or (ii) subject to any license or right that the Open Source Initiative has recognized or approved as an open source license.  The Company and its Subsidiaries have not (a) incorporated Open Source Materials into, or combined Open Source Materials with, the Company Products or any Intellectual Property owned or used by the Company or any of its Subsidiaries, (b) distributed Open Source Materials in conjunction with the Company Products or any Intellectual Property owned or used by the Company or any of its Subsidiaries, or (c) used Open Source Materials in a manner that would make any Company Product or any Intellectual Property owned or used by the Company or any of its Subsidiaries, or any part thereof, Open Source Materials.

2.17            Contracts .

(a)           Neither the Company nor its Subsidiaries is a party to, or bound by:

(i)           any employment Contract, other tha