AGREEMENT AND PLAN OF REORGANIZATION

Exhibit 2.1

AGREEMENT AND PLAN OF REORGANIZATION

OMNITURE, INC.,

OFFERMATICA CORPORATION,

HENRY BAKER, AS STOCKHOLDER REPRESENTATIVE,

AND

Dated as of September 7, 2007

TABLE OF CONTENTS

		Page
ARTICLE I DEFINITIONS			2
1.1 Certain Defined Terms			2
1.2 Interpretations			12
ARTICLE II THE MERGER			13
2.1 The Merger; The Reverse Split			13
2.2 The Closing			14
2.3 The Effective Time			14
2.4 General Effects of the Merger			14
2.5 Organizational Documents			14
2.6 Directors, Managers and Officers			15
2.7 Effect of Merger on the Capital Stock of the Constituent Corporations			15
2.8 Dissenting Shares			20
2.9 Determination of Final Working Capital			21
2.10 Payment Procedures			24
2.11 No Further Ownership Rights in Company Capital Stock			26
2.12 Lost, Stolen or Destroyed Certificates			27
2.13 Additional Adjustments to Merger Consideration			27
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY			27
3.1 Organization of the Company			27
3.2 Company Capital Structure			28
3.3 Subsidiaries			30
3.4 Authority			30
3.5 No Conflict			31
3.6 Consents			31
3.7 Company Financial Statements			32
3.8 No Undisclosed Liabilities			32
3.9 No Changes			33
3.10 Accounts Receivable			36
3.11 Tax Matters			36
3.12 Restrictions on Business Activities			39
3.13 Title to Properties; Absence of Liens and Encumbrances; Condition of Equipment; Customer Information			39
3.14 Intellectual Property			39
3.15 Material Contracts			48
3.16 Interested Party Transactions			50
3.17 Governmental Authorization			50
3.18 Litigation			51
3.19 Minute Books			51
3.20 Environmental Matters			51
3.21 Brokers’ and Finders’ Fees			51
3.22 Employee Benefit Plans and Compensation			52

		Page
3.23 Insurance			55
3.24 Compliance with Laws			56
3.25 Foreign Corrupt Practices Act			56
3.26 Substantial Customers and Suppliers			56
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB			56
4.1 Organization			56
4.2 Authority			56
4.3 Consents			57
4.4 No Conflict			57
4.5 Parent Common Stock			57
4.6 SEC Documents; Purchaser Financial Statements			57
4.7 No Ownership of Company Stock			58
4.8 Financing			58
4.9 Brokers’ and Finders’ Fees			58
ARTICLE V CONDUCT PRIOR TO THE EFFECTIVE TIME			58
5.1 Affirmative Conduct of Business of the Company			58
5.2 Restrictions on Conduct of Business of the Company			59
5.3 No Solicitation			62
ARTICLE VI ADDITIONAL AGREEMENTS			63
6.1 Information Statement; Fairness Hearing and California Permit			63
6.2 Approval of the Company Stockholders			65
6.3 Access to Information			66
6.4 Notification of Certain Matters			66
6.5 Confidentiality			67
6.6 Public Disclosure			67
6.7 Commercially Reasonable Efforts to Complete			67
6.8 Regulatory Approvals			68
6.9 Contract Consents			69
6.10 Pre-Closing Employee Matters			69
6.11 Employee Matters			69
6.12 Parent Common Stock Listing			70
6.13 S-8 Registration			70
6.14 Termination of Certain Employee Plans			71
6.15 Expenses			71
6.16 Spreadsheet			71
6.17 Release of Liens			71
6.18 FIRPTA Compliance			71
6.19 145 Affiliates			71
6.20 Insurance Matters			72
6.21 Further Assurances			72
6.22 Director and Officer Indemnification			72
6.23 Federal Income Tax Treatment; Tax Returns			73

		Page
ARTICLE VII CONDITIONS TO THE MERGER			73
7.1 Conditions to Obligations of Each Party to Effect the Merger			73
7.2 Conditions to the Obligations of Parent and Merger Sub			74
7.3 Conditions to Obligations of the Company			76
ARTICLE VIII SURVIVAL; INDEMNIFICATION; ESCROW ARRANGEMENTS			77
8.1 Survival			77
8.2 Indemnification			77
8.3 Indemnification Limitations			78
8.4 No Indemnification Limitations			79
8.5 Indemnification Claims Procedures			80
8.6 Third-Party Claims			82
8.7 Escrow Arrangements			83
8.8 Stockholder Representative			87
ARTICLE IX TERMINATION, AMENDMENT AND WAIVER			89
9.1 Termination			89
9.2 Effect of Termination			90
9.3 Amendment			90
9.4 Extension; Waiver			90
ARTICLE X GENERAL PROVISIONS			90
10.1 Notices			91
10.2 Counterparts			92
10.3 Entire Agreement			92
10.4 No Third Party Beneficiaries			92
10.5 Assignment			93
10.6 Severability			93
10.7 Other Remedies			93
10.8 Governing Law			93
10.9 Consent to Jurisdiction			93
10.10 Waiver of Jury Trial			93

INDEX OF EXHIBITS AND SCHEDULES

Exhibits
Exhibit A-1		Company Support Stockholders
Exhibit A-2		Form of Support Stockholder Merger Written Consent
Exhibit B-1		Form of Key Employee Non-Competition Agreement
Exhibit B-2		Form of Key Employee Offer Letters
Exhibit C		Certificate of Amendment
Exhibit D		Certificate of Merger
Exhibit E		Form of Rule 145 Affiliate Agreement
Exhibit F		Form of Legal Opinion of Counsel to the Company
Exhibit G		Form of Legal Opinion of Counsel to Parent
Schedules
Schedule 1.1(q)		Specified Claims
Schedule 1.1(ddd)		Key Employees
Schedule 1.1(cccc)		Specified Losses
Schedule 5.2		List of Company Actions Not Requiring Prior Written Consent
Schedule 6.3		Source Code Access Procedure
Schedule 6.9		Schedule of Third Party Contract Consents
Schedule 6.10(a)		Current Employees and Consultants to Sign Employee Proprietary Information Agreements and Consultant Proprietary Information Agreements
Schedule 6.16		Spreadsheet
Schedule 6.22		D&O Indemnity Agreements
Schedule 7.1(d)		List of Anti-trust Approvals Required
Schedule 7.2(f)		Required Third Party Consents
Schedule 7.2(n)		List of Liens to be Released

AGREEMENT AND PLAN OF REORGANIZATION

     THIS AGREEMENT AND PLAN OF REORGANIZATION (the “ Agreement ”) is made and entered into as of September 7, 2007 by and among Omniture, Inc., a Delaware corporation (“ Parent ”), San Francisco Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of Parent (“ Merger Sub ”), Offermatica Corporation, a Delaware corporation (the “ Company ”), only as to Section 2.9 , Section 2.10, Article VIII and Article X , Henry Baker, as stockholder representative (the “ Stockholder Representative ”), and, only as to Article VIII and Article X , US Bank National Association, as Escrow Agent (the “ Escrow Agent ”). All capitalized terms that are used in this Agreement shall have the respective meanings ascribed thereto in Article I .

RECITALS

     A. Parent, Merger Sub and the Company intend to effect a merger (the “ Merger ”) of Merger Sub with and into the Company in accordance with the terms and conditions of this Agreement, Delaware Law (as defined below) and, to the extent applicable, California Law (as defined below), with the Company to be the surviving corporation of the Merger.

     B. The boards of directors of each of Parent, Merger Sub and the Company believe it is advisable and in the best interests of each corporation and its respective stockholders that Parent, Merger Sub and the Company consummate the Merger and the other transactions contemplated hereby to which they are parties and, in furtherance thereof, have approved this Agreement and the Merger.

     C. Pursuant to the Merger, among other things, (i) all issued and outstanding Company Capital Stock will be converted into the right to receive the amount of cash and stock consideration set forth herein, (ii) all issued and outstanding Company Warrants to purchase Company Capital Stock not otherwise exercised prior to the Effective Time will be converted into the right to receive the amount of cash and stock consideration set forth herein, (iii) all issued and outstanding Company Convertible Notes not otherwise converted or repaid prior to the Effective Time will be converted into the right to receive the amount of cash and stock consideration set forth herein, and (iv) all issued and outstanding Company Options to purchase Company Capital Stock not otherwise exercised prior to the Effective Time will be assumed by Parent in accordance with the terms hereof.

     D. Promptly after the execution and delivery of this Agreement, the Company shall submit to each of the persons and entities identified on Exhibit A-1 (the “ Company Support Stockholders ”) an irrevocable, contingent written consent substantially in the form attached hereto as Exhibit A-2 (the “ Support Stockholder Merger Written Consent ”).

     E. Concurrently with the execution and delivery of this Agreement by the parties hereto, as a material inducement to Parent and Merger Sub to enter into this Agreement, the Key Employees are entering into or executing, as applicable (i) a Non-Competition and Non-Solicitation Agreement with Parent, each in the form attached as Exhibit B-1 (collectively, the “ Key Employee Non-Competition Agreements ”) and (ii) an offer letter, each in the form

attached as Exhibit B-2 (collectively, the “ Key Employee Offer Letters”) , each to become effective only at the Effective Time.

     The parties hereto desire to make certain representations, warranties, covenants and other agreements in connection with the Merger.

     NOW, THEREFORE, in consideration of the mutual agreements, covenants and other premises set forth herein, the mutual benefits to be gained by the performance thereof, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and accepted, the Company, Parent, Merger Sub, with respect to Section 2.9 , Section 2.10 , Article VIII and Article X only, the Stockholder Representative and, with respect to Article VIII and Article X only, the Escrow Agent hereby agree as follows:

ARTICLE I

DEFINITIONS

      Certain Defined Terms . For all purposes of and under this Agreement, the following capitalized terms shall have the following respective meanings:

          (a) “ Aggregate Cash Amount ” shall mean an amount equal to the product of (i) the Closing Adjusted Merger Consideration multiplied by (ii) the Aggregate Cash Percentage.

          (b) “Aggregate Cash Percentage ” shall mean the quotient obtained by dividing (A) Thirty Million Dollars ($30,000,000.00) by (B) Sixty-Five Million Dollars ($65,000,000.00), expressed as a decimal.

          (c) “Aggregate Stock Percentage ” shall mean the quotient obtained by dividing (A) Thirty-Five Million Dollars ($35,000,000.00) by (B) Sixty-Five Million Dollars ($65,000,000.00), expressed as a decimal.

          (d) “Allocated Escrow Basket” shall mean an amount equal to $150,000.00.

          (e) “ Business Day ” shall mean each day that is not a Saturday, Sunday or other day on which banking institutions located in the State of Delaware, San Francisco, California or Salt Lake City, Utah are authorized or obligated by Law or executive order to close.

          (f) “ California Law ” shall mean the General Corporation Law of the State of California.

          (g) “ Closing Adjusted Merger Consideration ” shall mean (i) Sixty-Five Million Dollars ($65,000,000.00), (ii) less an amount equal to the amount of Estimated Unpaid Company Indebtedness, if any, and (iii) less an amount equal to the amount of Estimated Unpaid Third Party Expenses, if any and (iv) less the Estimated Closing Working Capital Shortfall, if any.

          (h) “ Closing Working Capital ” shall mean the Working Capital on the Closing Date.

          (i) “ CFRA ” shall mean the California Family Rights Act of 1993, as amended.

          (j) “ COBRA ” shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

          (k) “ Company Capital Stock ” shall mean the Company Common Stock, the Company Preferred Stock and any other shares of capital stock of the Company.

          (l) “ Company Common Stock ” shall mean shares of common stock, par value $0.0001 per share, of the Company.

          (m) “ Company Convertible Notes ” shall mean any outstanding Unsecured Convertible Promissory Notes of the Company, the principal amount (together with any accrued interest) of which is convertible, at the election of the holders thereof, into shares of Company Series B Preferred Stock.

          (n) “ Company Employee Plan ” shall mean each “employee benefit plan” within the meaning of Section 3(3) of ERISA and each other plan, program, policy, practice, contract, agreement or other similar arrangement, other than an Employee Agreement, providing for compensation, severance, termination pay, deferred compensation, performance awards, stock or stock-related awards, welfare benefits, fringe benefits or other employee benefits or remuneration of any kind, whether written or unwritten, funded or unfunded which is or has been maintained, contributed to, or required to be contributed to, by the Company or any ERISA Affiliate for the benefit of any Employee, or with respect to which the Company or any ERISA Affiliate has or would reasonably be expected to have any material liability or obligation and any International Employee Plan.

          (o) “ Company Indebtedness ” shall mean all liabilities or obligations of the Company outstanding as of the Effective Time under the Loan and Security Agreement, dated as of October 19, 2006, between Silicon Valley Bank and the Company, as amended.

          (p) “ Company Intellectual Property ” shall mean any and all Intellectual Property Rights and Technology or other embodiments of Intellectual Property Rights that are owned by the Company, and used in the current conduct of the Business, other than Non-Core Intellectual Property. For the avoidance of doubt, “Company Intellectual Property” does not include the following domain names: www.siteisdead.com, www.landingpageoptimization.com, or www.optimizeandprophesize.com, nor any content displayed on any such website or related blogs (it being understood and agreed that the foregoing are owned by Persons other than the Company).

          (q) “ Company Material Adverse Effect ” shall mean any change, event, development, circumstance or effect (any such item, an “Effect ”), individually or when taken together with all other Effects, that is or would reasonably be expected to be materially adverse to the business, operations, financial condition or results of operations of the Company, taken as a whole with its Subsidiaries; provided , however , that in no event shall any of the following, alone or in combination, be deemed to constitute, nor shall any of the following be taken into account in determining whether there has been (or would reasonably be expected be to be) a

“Company Material Adverse Effect”: (i) any Effect resulting from changes in the general economic conditions in the United States or the world; (ii) Effects resulting from changes or conditions generally affecting the industry in which the Company operates, which do not have a disproportionately adverse effect upon the Company; (iii) any Effect resulting from any action or inaction requested of the Company by Parent or Merger Sub or any action that is required or contemplated pursuant to the terms of this Agreement; (iv) any Effect resulting from the announcement, pendency or consummation of the transactions contemplated by this Agreement and the Related Agreements (including the failure in and of itself to meet the Forecast); provided , however, that the underlying basis for the failure to meet the Forecast may be taken into account in making a determination as to whether there has been a Company Material Adverse Effect); (v) any Effect resulting from actions taken to comply with changes after the date of this Agreement in applicable Laws or changes in GAAP; (vi) any acts of terrorism, sabotage, military actions, outbreak or acts of war, or hostilities, or any escalation or material worsening of any of the foregoing existing or underway as of the date hereof, or any earthquakes or other natural disasters; or (vii) the commencement or pendency of the matter described on Schedule 1.1(q) ( provided , however , that this exception shall not apply to Effects on the Company’s business arising out of such matter).

          (r) “ Company Option ” shall mean any issued and outstanding option or warrant (including commitments to grant options, but excluding Company Warrants, the Company Convertible Notes, Company Series A Preferred Stock and Company Series B Preferred Stock to the extent otherwise set forth in Schedule 3.2 or issued in accordance with Schedule 5.2 ) to purchase or otherwise acquire shares of Company Capital Stock (whether or not vested).

          (s) “ Company Option Plan ” shall mean Company’s 2005 Equity Incentive Plan.

          (t) “ Company Preferred Stock ” shall mean shares of preferred stock, par value $0.0001 per share, of the Company.

          (u) “ Company Products ” shall mean the Core Products and Non-Core Products.

          (v) “ Company Restricted Shares ” shall mean any shares that are unvested or are subject to termination or a repurchase option, substantial risk of forfeiture or other similar condition (in each case giving effect to any acceleration of vesting or lapse of such option, risk or condition due to the consummation of the Merger and the other transactions contemplated by this Agreement) under any applicable restricted stock purchase agreement or other similar agreement with the Company.

          (w) “ Company Series A Preferred Stock ” shall mean the Series A Preferred Stock, par value $0.00001 per share, of the Company.

          (x) “ Company Series B Preferred Stock ” shall mean the Series B Preferred Stock of the Company, which if issued upon the conversion of any Company Convertible Notes or Company Warrants would have terms, rights, preferences and limitations pari passu in all

-4-

respects with the Company Series A Preferred Stock, except that the Company Series B Preferred Stock would have a liquidation preference per share equal to $3.00.

          (y) “ Company Stockholder ” shall mean a holder of any shares of Company Capital Stock.

          (z) “ Company Warrant ” shall mean any issued and outstanding warrant to purchase or otherwise acquire shares of Company Capital Stock.

          (aa) “ Continuing Employee ” shall mean each Employee of the Company who will be an employee of Parent or any of its Subsidiaries immediately following the Effective Time.

          (bb) “ Contract ” shall mean any mortgage, indenture, note, lease, contract, covenant or any other legally binding agreement, instrument, arrangement, commitment, concession, franchise or license.

          (cc) “Core Products” shall mean the Testing and Optimization Application Service Offering currently made available by the Company that is comprised of (A) the core application software (source code and executable software) on the Offermatica production servers, including the campaign engine and Offermatica end-user administration and campaign management systems; (B) network architecture and topology (production server and network configuration of the core application); (C) the Offermatica database and schema for campaign data capture, user administration, end-user profiles and campaign configuration; and (D) APIs (external interface definitions and data transfer schemas for interfacing with the core application running on the network, including the mbox, adbox, REST APIs and graphical user interfaces delivered through HTTP). For the avoidance of doubt, “Core Products” does not include any Third Party Collaboration Intellectual Property.

          (dd) “ Current Assets ” shall mean the total current assets of the Company, on a consolidated basis, derived from the books and records of the Company and determined in accordance with GAAP applied on a basis consistent with the Current Balance Sheet.

          (ee) “ Current Employee ” shall mean an employee of the Company or its Subsidiaries on the date hereof.

          (ff) “ Current Liabilities ” shall mean the total current liabilities of the Company, on a consolidated basis, derived from the books and records of the Company and determined in accordance with GAAP applied on a basis consistent with the Current Balance Sheet.

          (gg) “ DOL ” shall mean the United States Department of Labor.

          (hh) “ Effective Time Company Stockholder ” shall mean any holder of any Company Capital Stock, Company Warrant or Company Convertible Note immediately prior to the Effective Time.

          (ii) “ Employee ” shall mean any current or former employee or director of the Company or any of its Subsidiaries.

          (jj) “ Employee Agreement ” shall mean each employment, severance, separation, settlement, relocation, repatriation, expatriation or other agreement or contract (including, any offer letter or any agreement providing for acceleration of the vesting of Company Options or any other agreement providing for compensation or benefits) between the Company or any of its Subsidiaries and any Employee.

          (kk) “ Environmental Laws ” are all applicable Laws regarding pollution, protection of the environment, preservation of natural resources or exposure of any individual to Hazardous Materials including the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, the Resource Recovery and Conservation Act of 1976, the Federal Water Pollution Control Act, the Clean Air Act, the Hazardous Materials Transportation Act, the Clean Water Act, all as amended.

          (ll) “ ERISA ” shall mean the Employee Retirement Income Security Act of 1974, as amended.

          (mm) “ ERISA Affiliate ” shall mean any other Person under common control with the Company within the meaning of Section 414(b), (c), (m) or (o) of the Code, and the regulations issued thereunder.

          (nn) “ Escrow Amount ” shall mean an amount equal to Eight Million Dollars ($8,000,000.00).

           (oo) “Estimated Closing Working Capital” shall mean the Closing Working Capital set forth on the Company’s Closing Consideration Statement.

          (pp) “ Estimated Closing Working Capital Shortfall ” shall mean the amount, if any, by which the Estimated Closing Working Capital is less than the Working Capital Target Amount.

          (qq) “ Estimated Unpaid Company Indebtedness ” shall mean the Company Indebtedness, if any, set forth on the Company’s Closing Consideration Statement.

          (rr) “ Estimated Unpaid Third Party Expenses ” shall mean the Unpaid Third Party Expenses, if any, set forth on the Company’s Closing Consideration Statement.

          (ss) “ Excess Unpaid Company Indebtedness ” shall mean the amount by which the Final Unpaid Company Indebtedness exceeds the Estimated Unpaid Company Indebtedness, if any; provided , however , that “Excess Unpaid Company Indebtedness” shall not include any amounts that (i) were included or taken into account in the calculation of Final Closing Working Capital or Closing Adjusted Merger Consideration or (ii) Parent claimed constituted Unpaid Company Indebtedness under Section 2.9(b) and that either (A) the parties agreed or (B) during the Accountant Arbitration the Accountant determined, did not constitute Unpaid Company Indebtedness.

          (tt) “ Excess Unpaid Third Party Expenses ” shall mean the amount by which the Final Unpaid Third Party Expenses exceeds the Estimated Unpaid Third Party Expenses, if any; provided, however , that “Excess Unpaid Third Party Expenses” shall not include any amounts that (i) were included or taken into account in the calculation of Final Closing Working Capital or Closing Adjusted Merger Consideration or (ii) Parent claimed constituted Unpaid Third Party Expenses under Section 2.9(b) and that either (A) the parties agreed or (B) during the Accountant Arbitration the Accountant determined, did not constitute Unpaid Third Party Expenses.

          (uu) “ Expiration Date ” shall mean the date that is the one (1) year anniversary of the Closing Date.

          (vv) “ FMLA ” shall mean the Family Medical Leave Act of 1993, as amended.

          (ww) “ GAAP ” shall mean United States generally accepted accounting principles consistently applied.

          (xx) “ Hazardous Material ” shall mean any material, chemical, emission or substance that has been designated by any Governmental Entity to be radioactive, toxic, hazardous, a pollutant or otherwise a danger to health, reproduction or the environment.

          (yy) “ HIPAA ” shall mean the Health Insurance Portability and Accountability Act of 1996, as amended.

          (zz) “ Intellectual Property ” shall mean Technology and Intellectual Property Rights.

          (aaa) “ Intellectual Property Rights ” shall mean, collectively, all of the following intangible legal rights in any and all jurisdictions throughout the world, whether or not filed, perfected, registered or recorded and whether now or hereafter existing, filed, issued or acquired: (i) issued patents, pending patent applications, patent disclosures, and patent rights, including any and all continuations, continuations in part, divisionals, provisionals, reissues, reexaminations, utility, model and design patents or any extensions thereof, inventions, invention disclosures, discoveries and improvements, with respect to patentable subject matter (“ Patents ”); (ii) copyrights, copyright applications, copyright registrations, mask work rights, integrated circuit topographies, Moral Rights, including any of the foregoing rights with respect to Software; (iii) rights in trademarks, trademark registrations, and applications therefor, trade names, business names, brand names, service marks, service names, logos, or trade dress, and general intangibles of a like nature or other indications of source and any goodwill symbolized by or associated with such marks; (iv) rights relating to trade secrets (including those trade secrets defined in the United States Uniform Trade Secrets Act, and under corresponding statutory and common law of any country in the world or under any treaty), confidential business, technical and know how information, inventions, invention disclosures, blueprints, drawings, specifications, designs, plans, proposals, discoveries, improvements, concepts, ideas, compositions, inventor’s notes, methods, processes, formulae, techniques, technical data, business and marketing plans and other proprietary or non-public business information, including customer lists, research and development information (whether or not patentable), in each case to

the extent any of the foregoing derives economic value (actual or potential) from not being generally known to other Persons, who can obtain economic value from its disclosure or use, excluding any rights in respect of any of the foregoing that comprise or are protected by issued Patents or Copyrights (“ Trade Secret ”); (v) Internet domain names, World Wide Web URLs or addresses, any goodwill associated therewith and any other rights relating thereto granted by any governmental or quasi governmental authority, including Internet domain name registrars; (vi) claims, causes of action, defenses, and rights to sue for past infringement relating to the enforcement of any of the foregoing; (vii) any goodwill symbolized by or associated with any of the foregoing; and (viii) all other intellectual or proprietary rights in any and all jurisdiction throughout the world.

          (bbb) “ International Employee Plan ” shall mean each Company Employee Plan or Employee Agreement that has been adopted or maintained by the Company or any of its Subsidiaries with respect to which the Company or any of its Subsidiaries has any material liability with respect to Employees who perform services outside the United States.

          (ccc) “ IRS ” shall mean the United States Internal Revenue Service.

          (ddd) “ Key Employees ” shall mean the Current Employees listed in Schedule 1.1(ddd) .

          (eee) “ Law ” shall mean any United States federal, state or local or any foreign statute, law (including common law), rule, regulation, ordinance, code, directive or any other requirement or rule of law.

          (fff) “ Lien ” shall mean any lien, pledge, charge, claim, mortgage, security interest or other encumbrance of any sort.

          (ggg) “ Measurement Price ” shall mean the average closing sale price of one share of Parent Common Stock quoted on the Nasdaq Global Market, as reported in The Wall Street Journal, over the forty-five (45) consecutive calendar day period ending on the date immediately preceding the date which is five (5) calendar days prior to the date on which the parties reasonably anticipate will be the Closing Date (as adjusted appropriately to reflect any stock splits, stock dividends, combinations, reorganizations, reclassifications or similar events).

          (hhh) “ Moral Rights ” means any right under applicable Law to claim authorship to or to object to any distortion, mutilation, or other modification or other derogatory action in relation to a work, whether or not such would be prejudicial to the author’s reputation, and any similar right, such as recognition of authorship or access to work, existing under common or statutory law of any country in the world or under any treaty, regardless of whether or not such right is denominated or generally referred to as a “moral right.”

          (iii) “ Non-Core Products ” shall mean the products and/or service offerings of the Company that are not Core Products. A “Non-Core Product” shall exclude any Software or other Technology that is also incorporated into any Core Product.

          (jjj) “ Non-Core Intellectual Property ” shall mean (i) any Third Party Collaboration Intellectual Property and (ii) all Intellectual Property Rights or Technology of the

Company that was developed in whole or in part by the Company and that is not used in the current conduct of the Business.

          (kkk) “ Object Code ” shall mean computer software, substantially or entirely in binary form, which is intended to be directly executable by a computer after suitable processing and linking but without the intervening steps of compilation or assembly.

          (lll) “ Option Exchange Ratio ” shall mean the quotient obtained by dividing (a) (i) the Closing Adjusted Merger Consideration less (ii) the Total Liquidation Preference Amount by (b) the Trading Price and thereafter by (c) the number of Total Fully Diluted Shares.

          (mmm) “ Parent Common Stock ” shall mean shares of the common stock, par value $0.01 per share, of Parent.

          (nnn) “ Pension Plan ” shall mean each Company Employee Plan that is an “employee pension benefit plan,” within the meaning of Section 3(2) of ERISA.

          (ooo) “ Per Share Cash Residual Amount ” shall mean the quotient obtained by dividing (a) the Total Residual Cash Amount by (y) the Total Outstanding Shares.

          (ppp) “ Per Share Stock Amount ” shall mean the number of shares of Parent Common Stock equal to the quotient obtained by dividing (a) (i) the product of (A)(1) the Closing Adjusted Merger Consideration less (2) the Total Liquidation Preference Amount multiplied by (B) the Total Outstanding Share Percentage, less (ii) the Total Residual Cash Amount, by (b) the Trading Price and (c) the number of Total Outstanding Shares.

          (qqq) “ Person ” shall mean an individual or entity, including a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, or a Governmental Entity (or any department, agency, or political subdivision thereof).

          (rrr) “ Pro Rata Portion ” shall mean, with respect to each Effective Time Company Stockholder, an amount equal to the quotient obtained by dividing (x) the Merger Consideration payable to such Effective Time Company Stockholder , by (y) the Merger Consideration payable to all Effective Time Company Stockholders. For the purposes of this definition, any shares of Parent Common Stock payable pursuant to Section 2.7(d) or (h) shall be valued at the Trading Price.

          (sss) “ Registered Intellectual Property ” shall mean all United States, international and foreign: (i) Patents, including applications therefor; (ii) registered trademarks, applications to register trademarks, including intent-to-use applications, or other registrations or applications related to trademarks; (iii) copyright registrations and applications to register copyrights; (iv) registered mask works and applications to register mask works; and (v) any other Intellectual Property and Intellectual Property Rights that have been registered, filed, certified or otherwise perfected or recorded with or by any state, provincial, federal, government or other public or quasi-public legal authority.

          (ttt) “ Related Agreements ” shall mean (i) the Confidentiality Agreement, (ii) the Key Employee Non-Competition Agreements, (iii) the Key Employee Offer Letters, and (iv) the Support Stockholder Merger Written Consent.

          (uuu) “ SEC ” shall mean the United States Securities and Exchange Commission.

          (vvv) “ Series A Preferred Preference Amount ” shall mean that amount obtained by multiplying (x) the aggregate number of shares of Company Series A Preferred Stock issued and outstanding immediately prior to the Effective Time, by (y) the weighted average Series A Preferred Preference Per Share.

          (www) “ Series A Preferred Preference Per Share ” shall mean, with respect to each share of Series A Preferred Stock, an amount equal to $1.00, plus the applicable per share amount of any accrued and unpaid dividends payable in respect of such share of the Series A Preferred Stock as of the Effective Time.

          (xxx) “ Series B Preferred Preference Amount ” shall mean that amount obtained by multiplying (x) the aggregate number of shares of Series B Preferred Stock that would be issued upon the conversion of the Company Convertible Notes pursuant to Section 2.7(h)(ii) immediately prior to the Effective Time, by (y) the Series B Preferred Preference Per Share.

          (yyy) “ Series B Preferred Preference Per Share ” shall mean, with respect to each share of Series B Preferred Stock, an amount equal to $3.00.

          (zzz) “ Shrink-Wrap Code ” shall mean generally commercially available binary code (other than development tools and development environments) where available for a cost of not more than $35,000 for a perpetual license for a single user or work station or $150,000 in the aggregate for all users and work stations.

          (aaaa) “ Software ” shall mean any and all (i) computer programs, including any and all software implementations of algorithms, models and methodologies, whether in Source Code or Object Code, (ii) databases and compilations, including any and all data and collections of data, whether machine readable or otherwise, (iii) descriptions, flow-charts and other work product used to design, plan, organize and develop any of the foregoing and (iv) all User Documentation, including user manuals and training materials, relating to any of the foregoing, in each case developed, owned or licensed by the Company.

          (bbbb) “ Source Code ” shall mean computer software and code, in form other than Object Code or machine readable form, including related programmer comments and annotations, help text, data and data structures, instructions and procedural, object-oriented and other code, which may be printed out or displayed in human readable form.

          (cccc) “ Specified Losses ” shall have the meaning set forth in Schedule 1.1(cccc) .

          (dddd) “ Subsidiary ” shall mean any Person in which the Company or Parent, as the context requires, directly or indirectly through an ownership interest in another Person,

beneficially owns greater than fifty percent (50%) of either the equity interest, or voting power of or in such Person.

          (eeee) “ Technology ” shall mean any or all of the following: (i) works of authorship, including computer programs in any form, including but not limited to, Source Code and Object Code, whether embodied in Software, firmware or otherwise, development tools, documentation, designs, files, records, data and all media on which any of the foregoing is recorded, all mask works; (ii) inventions (whether or not patentable), improvements, and technology; (iii) proprietary and confidential information, trade secrets and know how; (iv) databases, data compilations and collections, customer lists and technical data; (v) tools, methods and processes; and (vi) all instantiations and disclosures of the foregoing in any form and embodied in any media, and all documentation related to the foregoing.

          (ffff) “ Testing and Optimization Application Service Offerings ” shall mean the Company Products that provide testing, optimization or targeted content delivery services on a services basis.

           (gggg) “Third Party Collaboration Intellectual Property ” means any Intellectual Property Rights and Technology that is incorporated in or embodied in any tools, applications or work product that were developed by the Company for a specific customer (either individually or jointly with the customer) and are not integrated, in whole or in part, into the code base of the Core Products, including the following tools or applications: (x) the Cliq application that was developed with StepChange Group; (y) the Flash Ad delivery component that was developed with Camelot Communications, Ltd.; and (z) hosted flows that were developed with Assembla and are or were used by Microsoft and Blockbuster. “Third Party Collaboration Intellectual Property” shall exclude any Software or other Intellectual Property that is also incorporated in or embodied in any Core Product.

          (hhhh) “ Total Liquidation Preference Amount ” shall mean an amount equal to the sum of the Series A Preferred Preference Amount and Series B Preferred Preference Amount.

          (iiii) “ Total Liquidation Preference Cash ” shall mean an amount equal to the product of (a) the Total Liquidation Preference Amount and (b) the Aggregate Cash Percentage.

          (jjjj) “ Total Liquidation Preference Stock ” shall mean an amount equal to the product of (a) the Total Liquidation Preference Amount and (b) the Aggregate Stock Percentage.

          (kkkk) “ Total Outstanding Shares ” shall mean the aggregate number of shares of Company Capital Stock issued and outstanding immediately prior to the Effective Time (including the aggregate number of shares of Series B Preferred Stock that would be issued upon the exercise or conversion, as applicable, of the Company Warrants and Company Convertible Notes if exercised or converted in full in accordance with the terms thereof), calculated on an as converted to Company Common Stock basis.

          (llll) “ Total Outstanding Shares Percentage ” shall mean the quotient obtained by dividing (a) the number of Total Outstanding Shares by (b) the number of Total Fully Diluted Shares.

          (mmmm) “ Total Fully Diluted Shares ” shall mean the sum of (x) the Total Outstanding Shares, and (y) the aggregate number of shares of Company Capital Stock, calculated on the treasury method, that are issuable upon full exercise, exchange or conversion of all Company Options and any other rights (whether vested or unvested) that are convertible into, exercisable for or exchangeable for, shares of Company Capital Stock (without duplication for any Company Warrants and the Company Convertible Notes to the extent included in the Total Outstanding Shares), in each case to the extent issued and outstanding as of, and not exercised, converted in to Company Capital Stock or cancelled immediately prior to, the Effective Time.

          (nnnn) “ Total Residual Cash Amount ” shall mean the (a) Aggregate Cash Amount less (b) the Total Liquidation Preference Cash.

          (oooo) “ Trading Price ” shall mean the average closing sale price of one share of Parent Common Stock quoted on the Nasdaq Global Market, as reported in The Wall Street Journal, over the forty-five (45) consecutive calendar day period ending on the date immediately preceding the Closing Date (as adjusted appropriately to reflect any stock splits, stock dividends, combinations, reorganizations, reclassifications or similar events).

          (pppp) “ Unpaid Company Indebtedness ” shall mean the amount of any Company Indebtedness that is outstanding and unpaid as of the Closing.

          (qqqq) “ Unpaid Third Party Expenses ” shall mean the amount of Third Party Expenses incurred by the Company prior to or at the Closing that is unpaid as of the Closing.

          (rrrr) “ User Documentation ” shall mean explanatory and informational materials concerning the Company Products, in printed or electronic format, which the Company has released for distribution to end users with such Company Products, which may include manuals, descriptions, user and/or installation instructions, diagrams, printouts, listings, flow-charts and training materials, contained on visual media such as paper or photographic film, or on other physical storage media in machine readable form.

          (ssss) “ WARN ” shall mean the Worker Adjustment and Retraining Notification Act.

          (tttt) “ Working Capital ” shall mean, as of a specified date, an amount equal to (i) Current Assets less (ii) Current Liabilities.

          (uuuu)” Working Capital Target Amount ” shall mean an amount equal to $0.

     1.2 Interpretations .

          (a) When a reference is made in this Agreement to an Exhibit or a Schedule, such reference shall be to an Exhibit or a Schedule to this Agreement unless otherwise indicated.

          (b) When a reference is made in this Agreement to an Article or a Section, such reference shall be to an Article or a Section of this Agreement unless otherwise indicated.

          (c) The words “include”, “includes” and “including” when used herein shall be deemed in each case to be followed by the words “without limitation”.

          (d) The headings set forth in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

          (e) Unless otherwise specifically provided or the context otherwise requires, all references in this Agreement to the Company or Parent shall mean and refer to the Company and its direct and indirect Subsidiaries or Parent and its direct and indirect Subsidiaries, as the case may be.

          (f) All references in this Agreement to the Subsidiaries of a Person shall be deemed to include all direct and indirect Subsidiaries of such Person.

          (g) Unless otherwise specifically provided, all references in this Agreement to monetary amounts or dollars shall mean and refer to United States denominated dollars.

          (h) The parties hereto agree that they have been represented by legal counsel during the negotiation and execution of this Agreement and, therefore, waive the application of any Law providing that ambiguities in an agreement or other document shall be construed against the party drafting such agreement or document.

ARTICLE II

THE MERGER

     2.1 The Merger; The Reverse Split .

          (a) At the Effective Time, and upon the terms and subject to the conditions of this Agreement and the applicable provisions of the General Corporation Law of the State of Delaware (“ 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 Company, as the surviving corporation after the Merger, is referred to hereinafter as the “ Surviving Corporation .”

          (b) After the date of this Agreement, but at least two (2) Business Days prior to the date the Company reasonably expects to mail (the “ Mailing Date ”) the Information Statement to the Company Stockholders, Parent may elect in writing (the “ Reverse-Split Election ”) , in Parent’s sole discretion, to require the Company to consummate a reverse stock-split of the Company Common Stock (the “ Reverse Split ”), as provided in the certificate of amendment substantially in the form attached hereto as Exhibit C (the “ Certificate of Amendment ”). In addition, the Company may elect on its own at any time prior to the Mailing Date to consummate the Reverse Stock Split, subject to Parent’s consent (which consent will not be unreasonably withheld or delayed). Upon the terms and subject to the conditions of this Agreement, if Parent delivers a Reverse-Split Election to the Company in accordance with this Section 2.1(b) , or if the Company elects to consummate the Reverse Stock Split, subject to applicable Law and receipt of the Requisite Stockholder Approval, the Company shall cause the Certificate of Amendment to be filed with the Secretary of the State of the State of Delaware in

order to amend the Company’s certificate of incorporation pursuant to the terms set forth in the Certificate of Amendment. In connection with the Reverse Split, any amount used by the Company prior to the Closing Date to pay for fractional shares resulting from the Reverse Split shall not reduce the amount of the Closing Adjusted Merger Consideration, except to the extent that the amount of such cash is included or taken into account in the determination of the Estimated Closing Working Capital Shortfall and after the Closing, any amount used to pay for fractional shares resulting from the Reverse Split (the “ Reverse Split Fractional Cash ”) shall be paid out of the Escrow Fund. In the event that neither party elects to effect the Reverse Split, the Company shall, subject to applicable Law and the Requisite Stockholder Approval, cause the Certificate of Amendment (but amended to include only the amendment to Article IV, Section B(3)(c)(ii)(A)) to be filed with the Secretary of the State of the State of Delaware in order to amend the Certificate of Incorporation pursuant to the terms set forth in the Certificate of Amendment, as so amended.

     2.2 The Closing . Unless this Agreement is earlier terminated pursuant to Section 9.1 , the closing of the Merger (the “ Closing ”) shall take place at 10:00 a.m. (local time) on the second (2nd) Business Day following satisfaction or waiver (to the extent permitted hereunder) of the conditions set forth in Article VII (except for those conditions that, by their nature, are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions at the Closing), at the offices of Wilson Sonsini Goodrich & Rosati, Professional Corporation, One Market, Spear Tower, Suite 3300, San Francisco, California, 94105, unless another time, date or place is mutually agreed upon in writing by Parent and the Company. The date upon which the Closing actually occurs shall be referred to herein as the “ Closing Date .”

     2.3 The Effective Time . On the Closing Date, the parties hereto shall cause the Merger to be consummated by the filing of a duly executed Certificate of Merger, in substantially the form attached as Exhibit D (the “ Certificate of Merger ”) , with the Secretary of State of the State of Delaware, and the Merger shall become effective at the time of such filing or at such later date and time as the parties may mutually agree and specify in the Certificate of Merger (the time of the effectiveness of such filing with the Secretary of State of the State of Delaware being referred to herein as the “ Effective Time ”).

     2.4 General Effects of the Merger . At the Effective Time, the effect of the Merger shall be as set forth in this Agreement and as provided in the applicable provisions of Delaware Law. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, 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.

     2.5 Organizational Documents .

          (a) Certificate of Incorporation of the Surviving Corporation . The certificate of incorporation of the Company shall be amended in the Merger to read the same as the certificate of incorporation of Merger Sub as in effect immediately prior to the Effective Time, and shall be the certification 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, (x) Article I of the

certificate of incorporation of the Surviving Corporation shall be amended and restated in its entirety to read as follows: “The name of the corporation is Offermatica Corporation” and (y) the name of the incorporator of the Company shall not be amended.

          (b) Bylaws of the Surviving Corporation . The bylaws of the Company shall be amended to read the same as the bylaws of Merger Sub as in effect immediately prior to the Effective Time, and 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.

     2.6 Directors, Managers and Officers .

          (a) Directors/Managers . The directors of Merger Sub immediately prior to the Effective Time shall become the directors of the Surviving Corporation from and after the Effective Time, each to hold the office of a director of the Surviving Corporation in accordance with the provisions of Delaware Law and the certificate of incorporation and bylaws of the Surviving Corporation until their successors are duly elected and qualified.

          (b) Officers . Unless otherwise determined by Parent prior to the Effective Time, the officers of Merger Sub immediately prior to the Effective Time shall become the officers of the Surviving Corporation from and after the Effective Time, each to hold office in accordance with the provisions of the bylaws of the Surviving Corporation.

     2.7 Effect of Merger on the Capital Stock of the Constituent Corporations .

          (a) Merger Sub Common Stock . At the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub or the Company, each share of common stock of Merger Sub that is issued and outstanding immediately prior to the Effective Time shall be converted into, and thereafter represent, one validly issued, fully paid and nonassessable share of common stock of the Surviving Corporation, such that immediately following the Effective Time, Parent shall become the sole and exclusive owner of all of the issued and outstanding capital stock of the Company as the Surviving Corporation. Each stock certificate of Merger Sub shall thereupon evidence ownership of such shares of capital stock of the Surviving Corporation.

          (b) Parent-Owned or Company-Owned Company Capital Stock . Notwithstanding anything to the contrary in this Section 2.7 , at the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub or the Company, each share of Company Capital Stock that is held by Parent, the Company or any Subsidiary of Parent or the Company immediately prior to the Effective Time, shall be cancelled and extinguished without any consideration paid therefor or in respect thereof.

          (c) Dissenting Shares of Company Capital Stock . Notwithstanding anything to the contrary in this Section 2.7 , at the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, the Company or the holders of any shares of Company Capital Stock, Dissenting Shares shall be treated in accordance with Section 2.8 .

          (d) Company Capital Stock Generally . At the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, the Company or the holders of any shares of Company Capital Stock, each share of Company Capital Stock that is issued and outstanding immediately prior to the Effective Time (other than (i) any shares of Company Capital Stock covered by Section 2.7(b) and (ii) any Dissenting Shares) shall be cancelled and extinguished and shall be converted automatically into the right to receive, subject to the terms and conditions set forth in this Agreement (including the holdback of the Escrow Amount), the following consideration:

               (i) each outstanding share of Company Series A Preferred Stock shall be converted automatically into the right to receive:

               (1) an amount of cash (without interest) equal to the sum of (1) the product of (x) the applicable Series A Preferred Preference Per Share multiplied by (y) the Aggregate Cash Percentage plus (2) the Per Share Cash Residual Amount (collectively, the “ Series A Cash Consideration Per Share ”), and

               (2) a number of shares of Parent Common Stock equal to the sum of (1) the quotient obtained by dividing (x) the product of (I) the applicable Series A Preferred Preference Per Share multiplied by (II) the Aggregate Stock Percentage by (y) the Trading Price, plus (2) the Per Share Stock Amount (subject, in each case to Sections 2. 7(e) , (f), (i) and (j) ) (the “ Series A Stock Consideration Per Share ”);

               (ii) each outstanding share of Company Series B Preferred Stock shall be converted automatically into the right to receive:

               (1) an amount of cash (without interest) equal to the sum of (1) the product of (x) the Series B Preferred Preference Per Share multiplied by (y) the Aggregate Cash Percentage plus (2) the Per Share Cash Residual Amount (collectively, the “ Series B Cash Consideration Per Share ”), and

               (2) a number of shares of Parent Common Stock equal to the sum of (1) the quotient obtained by dividing (x) the product of (I) the Series B Preferred Preference Per Share multiplied by (II) the Aggregate Stock Percentage by (y) the Trading Price, plus (2) the Per Share Stock Amount (subject, in each case to Sections 2. 7(e) , (f), (i) and (j) ) (the “ Series B Stock Consideration Per Share ”); and

               (iii) each outstanding share of Company Common Stock shall be converted automatically into the right to receive:

               (1) an amount of cash (without interest) equal to the Per Share Cash Residual Amount (the “ Common Cash Consideration Per Share ”), and

               (2) a number of shares of Parent Common Stock equal to the Per Share Stock Amount (subject, in each case to Sections 2. 7(e) , (f), (i) and (j) ) (the “ Common Stock Consideration Per Share ”).

For purposes of calculating the amount of Merger Consideration payable to each Effective Time Company Stockholder pursuant to this Section 2.7(d) , all amounts payable in cash to such Effective Time Company Stockholder shall be aggregated and rounded up to the nearest whole cent and subject to Section 2.7(f) , all shares of parent Common Stock payable to such Effective Time Company Stockholder shall be aggregated and rounded down to the nearest whole share. As used in this Agreement, “ Merger Consideration ” shall mean the Series A Cash Consideration Per Share, the Series A Stock Consideration Per Share, the Series B Cash Consideration Per Share, the Series B Stock Consideration Per Share, the Warrant Cash Consideration Per Share, the Warrant Stock Consideration Per Share, the Common Cash Consideration Per Share and the Common Stock Consideration Per Share, in each case to be received by the Effective Time Company Stockholders and the holders of the Company Warrants and Company Convertible Notes pursuant to this Agreement.

          (e) Alternative Consideration . On or prior to the date that is five (5) calendar days prior to the date which Parent reasonably anticipates will be the Closing Date (such date, the “ Stock Price Measurement Date ”), if the Measurement Price is less than $20.00 per share, or if the Parent otherwise determines to deliver the Merger Consideration in all cash, then, Parent, in its sole and absolute discretion, may provide notice (the “ Election Notice ”) to the Company that the Merger Consideration otherwise payable to Effective Time Company Stockholders pursuant to Section 2.7(d) shall be as provided in the next sentence. If the Election Notice is delivered by Parent, notwithstanding anything to the contrary in this Agreement, in lieu of the amounts of Series A Stock Consideration Per Share, Series B Stock Consideration Per Share, Common Stock Consideration Per Share or Warrant Stock Consideration Per Share, as applicable, determined in accordance with Section 2.7(d) and in addition to the Series A Cash Consideration Per Share, Series B Cash Consideration Per Share, Common Cash Consideration Per Share or Warrant Stock Consideration Per Share, as applicable, determined in accordance with Section 2.7(d) :

               (i) each outstanding share of Company Common Stock shall be converted into the right to receive an amount of cash (without interest) equal to the product obtained by multiplying (x) Common Stock Consideration Per Share by (y) the Trading Price;

               (ii) each outstanding share of Company Series A Preferred Stock shall be converted into the right to receive an amount of cash (without interest) equal to the product obtained by multiplying (x) Series A Stock Consideration Per Share by (y) the Trading Price;

               (iii) each outstanding (or which would be outstanding upon conversion of the Company Convertible Notes) share of Company Series B Preferred Stock shall be converted into the right to receive an amount of cash (without interest) equal to the product obtained by multiplying (x) Series B Stock Consideration Per Share by (y) the Trading Price; and

               (iv) each outstanding Company Warrant shall be converted into the right to receive an amount of cash (without interest) equal to the product obtained by multiplying (x) Warrant Stock Consideration Per Share by (y) the Trading Price.

          (f) Fractional Shares . No fraction of a share of Parent Common Stock will be issued by virtue of the Merger, but in lieu thereof each holder of shares of Company Capital

Stock, Company Warrants or Company Convertible Notes that would otherwise be entitled to a fraction of a Parent Common Stock (after aggregating all fractional shares of Parent Common Stock that otherwise would be received by such holder) shall, upon surrender of such holder’s Company Stock Certificate(s) or in the case of a lost, stolen or destroyed certificate, upon delivery of an affidavit (and bond, if required) in the manner provided in Section 2.12 , receive from Parent an amount of cash (rounded to the nearest whole cent), without interest, less the amount of any withholding taxes as contemplated by Section 2.7(i) which are required to be withheld with respect thereto, equal to the product of: (i) such fraction, multiplied by (ii) the Trading Price.

          (g) Treatment of Company Options .

               (i) At the Effective Time, by virtue of the Merger and without any action on the part of the holders of any shares of Company Options, each Company Option that is issued and outstanding immediately prior to the Effective Time, whether or not then exercisable, will be assumed by Parent and converted automatically into an option to purchase Parent Common Stock (“ Assumed Options ”) as set forth below. Each Assumed Option will continue to have, and be subject to, the same terms and conditions set forth in the Company Option Plan and the agreements evidencing the grant thereof immediately prior to the Effective Time, including provisions with respect to vesting, except that (A) such Assumed Option shall be exercisable for that number of whole shares of Parent Common Stock equal to the product of (1) the number of shares of Company Common Stock that were issuable upon exercise of such Company Option immediately prior to the Effective Time, multiplied by the (2) the Option Exchange Ratio and rounded down to the nearest whole number of shares of Parent Common Stock, and (B) the per share exercise price for the shares of Parent Common Stock issuable upon exercise of such assumed Company Option shall be equal to the quotient obtained by dividing (x) the exercise price per share of Company Common Stock at which such assumed Company Option was exercisable immediately prior to the Effective Time, by (y) the Option Exchange Ratio, rounded up to the nearest whole cent; provided , however , that the exercise price of the option, the number of shares purchasable pursuant to such option and the terms and conditions of exercise of such option shall be determined in order to comply with Section 409A of the Code.

               (ii) Prior to the Effective Time, and subject to the review and approval of Parent (not to be unreasonably withheld, delayed or conditioned), the Company shall take all actions necessary to effect the transactions anticipated by Section 2. 7(g)(i) under the Company Option Plan and all Company Option agreements and any other applicable plan or arrangement of the Company (whether written or oral, formal or informal), including delivering all notices required thereby. Materials to be submitted to the holders of Company Options in connection with any notice required under this Section 2. 7(g)(ii) shall be subject to review and approval by Parent, which approval shall not be unreasonably withheld, delayed or conditioned. Promptly following the Closing, Parent shall issue to each holder of a Company Option that was assumed by Parent pursuant to Section 2. 7(g)(i) a document evidencing the assumption of such Company Option by Parent.

               (iii) Following the Effective Time, Parent will be able to grant stock awards, to the extent permissible by applicable Law and Nasdaq regulations, under the terms of the Company Option Plan or the terms of another plan adopted by Parent to issue the reserved

but unissued shares of Company Common Stock under such Company Option Plan and the shares that would otherwise return to the Company Option Plan pursuant to Section 3.3 thereof (which provides that shares of Company Common Stock subject to unexercised portions of any award granted thereunder that expires, terminates or is canceled, and shares of Company Common Stock issued pursuant to an award that are reacquired by Parent pursuant to the terms of the award under which such shares were issued, will return and may be used for awards to be granted under the Company Option Plan), except that (i) shares of Company Common Stock covered by such awards will be shares of Parent Common Stock and (ii) all references to a number of shares of Company Common Stock will be (A) changed to reference Parent Common Stock and (B) converted to a number of shares of Parent Common Stock equal to the product of the number of shares of Company Common Stock multiplied by the Option Exchange Ratio, rounded down to the nearest whole number of shares of Parent Common Stock. Notwithstanding the foregoing, neither the Company, nor any Company Stockholder, nor any holder of a Company Option, makes any representation or warranty or shall have any obligation or any liability whatsoever, including without limitation any indemnification obligation under this Agreement, or be required to take any action with respect to or arising out of this Section 2.7(g)(iii) .

          (h) Treatment of Company Warrants; Company Convertible Notes .

               (i) Parent shall not assume any Company Warrants in connection with the transactions contemplated hereby. At the Effective Time, each Company Warrant then outstanding shall, by virtue of the Merger and without any action on the part of the holder thereof, be cancelled and converted without exercise into and, subject to the terms and conditions set forth in this Agreement, represent the right to receive (subject to the holdback of the Escrow Amount) with respect to each share of Company Series B Preferred Stock then subject to purchase under such Company Warrant:

               (1) an amount of cash (without interest) equal to the Per Share Cash Residual Amount (the “ Warrant Cash Consideration Per Share ”), and

               (2) a number of shares of Parent Common Stock equal to the Per Share Stock Amount (subject, in each case to Sections 2. 7(e) , (f), (i) and (j) ) (the “ Warrant Stock Consideration Per Share ”).

Prior to the Effective Time, and subject to the review and approval of Parent (which will not be unreasonably withheld, delayed or conditioned), the Company shall take all commercially reasonable actions necessary to effect the transactions anticipated by this Section 2.7(h) under all Company Warrant agreements, including delivering notices required thereby.

               (ii) Parent shall not assume any Company Convertible Notes in connection with the transactions contemplated hereby. Immediately prior to the Effective Time, each Company Convertible Note then outstanding shall be treated as if it were converted into shares of Company Series B Preferred Stock pursuant to the terms of such Company Convertible Note, and at the Effective Time, by virtue of the Merger and without any action on the part of the holder thereof, subject to the terms and conditions set forth in this Agreement, shall represent the right to receive (subject to the holdback of the Escrow Amount) with respect to each share of

Company Series B Preferred Stock into which the Company Convertible Note is deemed to have converted, the Series B Cash Consideration Per Share and the Series B Stock Consideration Per Share.

          (i) Withholding Taxes . The Company and, on its behalf, Parent and the Surviving Corporation, shall be entitled to deduct and withhold from any portion of the Closing Adjusted Merger Consideration payable pursuant to this Agreement to any holder or former holder of Company Capital Stock, a Company Convertible Note, a Company Option or a Company Warrant such amounts as may be required to be deducted or withheld therefrom under any applicable provision of federal, state, local or foreign tax Law or under any applicable legal requirement, including any federal or state income tax withholding as a result of the exercise of a Company Option prior to the Effective Time. To the extent such amounts are so deducted or withheld, such amounts shall be treated for all purposes as having been paid to the Person to whom such amounts would otherwise have been paid, and Parent or the Surviving Corporation will promptly pay such amounts to the applicable taxing authority and will provide prompt written notice of such payment to the Effective Time Company Stockholder. Any such withholding shall be satisfied first by reducing the amount of the cash portion of the Merger Consideration payable to such Person hereunder, and to the extent the amount of required withholding exceeds the cash consideration payable to the Person, then by reducing the number of shares of Parent Common Stock issuable to such Person hereunder (such number of shares to be determined using the Trading Price).

          (j) Stockholder Loans . To the extent that any Effective Time Company Stockholder has outstanding loans from the Company as of the Effective Time, the Merger Consideration payable pursuant to this Section 2.7 to such Effective Time Company Stockholder shall be reduced in equal proportions of cash and shares of Parent Common Stock by an amount equal to the sum of the outstanding principal plus any accrued but unpaid interest of such Effective Time Company Stockholder’s loans as of the Effective Time. Such loans shall be deemed fully satisfied as to the amount by which the consideration is reduced pursuant to this Section 2.7(j) . To the extent that any consideration otherwise payable to such Effective Time Company Stockholder is so reduced, such amount shall be treated for all purposes as having been paid to such Effective Time Company Stockholder.

     2.8 Dissenting Shares .

          (a) Notwithstanding any other provisions of this Agreement to the contrary, any shares of Company Capital Stock held by an Effective Time Company Stockholder, who has not effectively withdrawn or lost such Effective Time Company Stockholder’s dissenters or appraisal rights under Delaware Law with respect to such shares of Company Capital Stock (the “ Dissenting Shares ”) shall not be converted into or represent a right to receive the applicable Merger Consideration for such shares of Company Capital Stock pursuant to Section 2.7 , but in lieu thereof, such stockholder thereof shall only be entitled to such rights as are provided by Delaware Law.

          (b) Notwithstanding the provisions of Section 2.8(a) , if any holder of Dissenting Shares shall effectively withdraw or lose (through failure to perfect or otherwise) such holder’s dissenters or appraisal rights under Delaware Law, then, as of the later of the

Effective Time and the occurrence of such event, such holder’s shares shall cease to be Dissenting Shares and will automatically be converted into and represent only the right to receive the applicable Merger Consideration for such shares of Company Capital Stock pursuant to Section 2.7 , without interest thereon, and upon surrender of the certificate representing such shares in accordance with the terms of Section 2.10 .

          (c) The Company shall give Parent (i) prompt notice of any written demand for appraisal or other payment received by the Company pursuant to the applicable provisions of Delaware Law, and (ii) the opportunity to participate in all negotiations and proceedings with respect to such demands. The Company shall not, except with the prior written consent of Parent (not to be unreasonably withheld), make any payment with respect to any such demands or offer to settle or settle any such demands. Any communication to be made by the Company to any Company Stockholder with respect to such demands shall be submitted to Parent in advance and shall not be presented to any Company Stockholder prior to the Company receiving Parent’s consent (not to be unreasonably withheld). Notwithstanding the foregoing, to the extent that Parent or the Surviving Corporation (i) makes any payment or payments in respect of any Dissenting Shares in excess of the consideration that otherwise would have been payable in respect of such shares in accordance with Section 2.7 of this Agreement (assuming payment in full of each Effective Time Company Stockholder’s Pro Rata Portion of the Escrow Amount) or (ii) incurs any Losses in respect of any Dissenting Shares (excluding payments for such shares) ((i) and (ii) together “ Dissenting Share Payments ”), Parent shall be entitled to recover under the terms of Article VIII the amount of such Dissenting Share Payments.

     2.9 Determination of Final Working Capital .

          (a) Preliminary Working Capital; Unpaid Indebtedness and Expenses .

               (i) At least three (3) Business Days prior to the Closing Date, the Company shall deliver to Parent (A) an unaudited consolidated balance sheet of the Company as of the Closing Date (the " Company’s Closing Company Balance Sheet ”); (B) a statement setting forth the Company’s good faith estimate of (1) the Closing Working Capital, (2) the Unpaid Company Indebtedness and (3) the Unpaid Third Party Expenses (such statement, the “ Company’s Closing Consideration Statement ”); and (C) the Company’s calculation of the Closing Adjusted Merger Consideration based upon the Company’s Closing Consideration Statement, with each such amount set forth in a separate section. The Company’s Closing Company Balance Sheet (x) shall be prepared in accordance with GAAP (except that the Company’s Closing Company Balance Sheet may omit footnotes and other presentation items that may be required by GAAP) applied consistently with respect to the accounting policies, practices and procedures used to prepare the Financials, and (y) shall fairly and accurately present the Company’s good faith estimate (based on reasonable assumptions) of the balance sheet of the Company as of the Closing Date. Notwithstanding the foregoing, the calculation of the Closing Working Capital set forth in Company’s Closing Consideration Statement shall treat as fully paid and not outstanding (1) any Unpaid Company Indebtedness and (2) any Unpaid Third Party Expenses, in each case to the extent such amounts are otherwise included or accounted for in the Company’s Closing Consideration Statement or the Closing Adjusted Merger Consideration.

          (b) Final Working Capital; Unpaid Indebtedness and Expenses .

               (i) Parent may (in its sole and absolute discretion) within sixty (60) calendar days following the Closing Date, prepare (or cause to be prepared) and deliver to the Stockholder Representative (A) an unaudited consolidated balance sheet of the Company as of the Closing (“ Parent’s Closing Company Balance Sheet ”); and (B) a statement setting forth Parent’s calculation of (1) the Closing Working Capital, (2) the Unpaid Company Indebtedness and (3) the Unpaid Third Party Expenses, with each such amount set forth in a separate section (such statement, the " Parent’s Closing Consideration Statement ”). Parent’s Closing Company Balance Sheet (x) shall be prepared in accordance with GAAP (except that Parent’s Closing Company Balance Sheet may omit footnotes and other presentation items that may be required by GAAP) applied consistently with respect to the accounting policies, practices and procedures used to prepare the Financials and the Company’s Closing Company Balance Sheet, and (y) shall fairly and accurately present Parent’s good faith estimate (based on reasonable assumptions) of the balance sheet of the Company as of the Closing Date. Notwithstanding the foregoing, the calculation of Closing Working Capital set forth in Parent’s Closing Consideration Statement shall treat as fully paid and not outstanding (1) any Unpaid Company Indebtedness and (2) any Unpaid Third Party Expenses, in each case to the extent such amounts are or were otherwise included or accounted for in the calculation of the Closing Adjusted Merger Consideration or Parent’s Closing Consideration Statement.

               (ii) In the event that Parent is not required, and does not elect, to deliver Parent’s Closing Company Balance Sheet or Parent’s Closing Consideration Statement pursuant to this Section 2.9(b) , for all purposes of and under this Agreement, “ Final Closing Working Capital ” shall equal the Estimated Closing Working Capital, “ Final Unpaid Company Indebtedness ” shall equal the Estimated Unpaid Company Indebtedness and “ Final Unpaid Third Party Expenses ” shall equal the Estimated Unpaid Third Party Expenses.

               (iii) In the event that the Stockholder Representative shall disagree with any item(s) or amount(s) set forth in Parent’s Closing Company Balance Sheet or Parent’s Closing Consideration Statement, within forty-five (45) calendar days following his receipt of Parent’s Closing Company Balance Sheet and Parent’s Closing Consideration Statement, the Stockholder Representative may deliver a notice of such disagreement (a “ Notice of Dispute ”) setting forth, in reasonable detail, to the extent known to the Stockholder Representative and for which the Stockholder Representative has access to the necessary information, (A) each item, amount or methodology so disputed by the Stockholder Representative, (B) the Stockholder Representative’s calculation of each such item or amount, and (C) the Stockholder Representative’s good faith estimate of Closing Working Capital, Unpaid Company Indebtedness and Unpaid Third Party Expenses after giving effect to the Stockholder Representative’s calculation of each such disputed item or amount. The Stockholder Representative shall be deemed to have irrevocably consented and agreed, for and on behalf of the Effective Time Company Stockholders, to Parent’s Closing Consideration Statement if the Stockholder Representative shall fail to deliver a Notice of Dispute, pursuant to this Section 2. 9(b)(iii) , prior to the expiration of the foregoing forty-five (45) calendar day period. In the event that the Stockholder Representative shall deliver to Parent a Notice of Dispute pursuant to this Section 2. 9(b)(iii) , the parties shall work in good faith to resolve and negotiate any disputed item(s), amount(s), methodologies and other matters that may arise in order to

determine the actual Closing Working Capital, Unpaid Company Indebtedness and Unpaid Third Party Expenses.

               (iv) In the event that Parent and the Stockholder Representative shall reach agreement, within thirty (30) calendar days following Parent’s receipt of a Notice of Dispute, on all disputed items, amounts, methodologies and any other matters that may arise then:

                    (1) Parent and the Stockholder Representative shall execute a memorandum setting forth the resolved item(s) and/or amount(s), and the Closing Working Capital, Unpaid Company Indebtedness and/or Unpaid Third Party Expenses (as applicable), as calculated based on the resolved item(s), amount(s), methodologies and other matters; and

                    (2) The “ Final Closing Working Capital ” shall be equal to the Closing Working Capital as so agreed by Parent and the Stockholder Representative, “ Final Unpaid Company Indebtedness ” shall equal the Unpaid Company Indebtedness as so agreed by Parent and the Stockholder Representative, and “ Final Unpaid Third Party Expenses ” shall equal the Unpaid Third Party Expenses as so agreed by Parent and the Stockholder Representative.

               (v) In the event that Parent and the Company are unable to reach agreement, within thirty (30) calendar days following Parent’s receipt of a Notice of Dispute delivered within the time-period set forth in clause (b)(iii) above, on all of the disputed item(s), amount(s), methodologies and other matters that may arise, then:

                    (1) if applicable, Parent and the Stockholder Representative shall execute a memorandum setting forth (1) the resolved item(s), amount(s), methodologies and other matters, if any, and (2) the item(s), amount(s), methodologies and other matters that remain in dispute following such negotiations;

                    (2) Parent and the Stockholder Representative shall submit all remaining disputed item(s) and amount(s) with respect to the Closing Working Capital, Unpaid Company Indebtedness and/or Unpaid Third Party Expenses (as applicable) to an accounting firm of national reputation that is mutually agreeable to Parent and the Stockholder Representative (“ Accountant ”) for resolution in accordance with the terms and conditions hereof. Each of the parties to this Agreement shall, and shall cause their respective Affiliates and representatives to, take commercially reasonable efforts to provide full cooperation to Accountant. Accountant shall (1) act in its capacity as an expert and not as an arbitrator, (2) consider only those items and amounts as to which there is a dispute between Parent and the Stockholder Representative, and (3) be instructed to use best efforts to reach its conclusions regarding any such dispute within thirty (30) calendar days after its appointment and provide a written explanation of its decision (such proceeding, the “ Accountant Arbitration ”). In the event that Parent and the Stockholder Representative submit any disputed item(s), amount(s), methodologies or other matters to Accountant pursuant to this Section 2. 9(b)(v) , each such party may submit a “position paper” to Accountant setting forth the position of such party with respect to any such disputed item, amount, methodologies and other matters, which shall be considered by Accountant as it deems appropriate. All expenses relating to the engagement of Accountant

(the “ Accountant Expenses ”) shall be borne proportionally by Parent, on the one hand, and the Effective Time Company Stockholders, on the other hand, based on the difference between (x) the Closing Working Capital, Unpaid Company Indebtedness and Unpaid Third Party Expenses (as applicable) proposed by Parent and the Stockholder Representative, respectively, and (y) the Closing Working Capital, Unpaid Company Indebtedness and Unpaid Third Party Expenses (as applicable) finally determined by the Accountant. To the extent any Accountant Expenses are the responsibility of the Effective Time Company Stockholders, such expenses shall be paid out of the Escrow Fund (and the Stockholder Representative and Parent shall each instruct the Escrow Agent to release such expenses to the Accountant). Accountant shall determine all disputed item(s) and amount(s) and its decision in respect thereof shall be final and binding upon Parent and the Stockholder Representative.

                    (3) The “ Final Closing Working Capital ”, “ Final Unpaid Company Indebtedness ” and “ Final Unpaid Third Party Expenses ” shall be equal to the Closing Working Capital, Unpaid Company Indebtedness and Unpaid Third Party Expenses, in each case, determined based upon: (x) the agreement of Parent and the Stockholder Representative in respect of any disputed items, amounts, methodologies and other matters, as set forth in the memorandum delivered by Parent and the Stockholder Representative pursuant to clause (1) of this Section 2. 9(b)(v) , in respect of each item, amount, methodology or other matter that is agreed upon by Parent and the Stockholder Representative; and (y) the resolution of any disputed items or amounts resolved by Accountant as provided in clause (2) of this Section 2. 9(b)(v) .

               (vi) The “ Shortfall Amount ” shall mean the sum of (1) if (x) the lesser of (I) the amount of the Working Capital Target Amount and (II) the amount of the Estimated Closing Working Capital exceeds (y) the amount of the Final Closing Working Capital, the amount of such excess, plus (2) the amount of Excess Unpaid Third Party Expenses, plus (3) the amount of Excess Unpaid Company Indebtedness.

     2.10 Payment Procedures .

          (a) Escrow Amount Deposit . At the Effective Time, Parent shall deposit with the Escrow Agent an amount of cash equal to the Escrow Amount on behalf of each Effective Time Company Stockholder. As a result, the Series A Cash Consideration Per Share, the Series B Cash Consideration Per Share, the Warrant Cash Consideration Per Share and the Common Cash Consideration Per Share, as the case may be, to which each Effective Time Company Stockholder is entitled to receive pursuant to Section 2.7(d) and Section 2.7(h) shall be reduced by an amount obtained by multiplying (x) such Effective Time Company Stockholder’s Pro Rata Portion by (y) the Escrow Amount, rounded to the nearest cent.

          (b) Closing Payments .

               (i) Within three (3) Business Days after the Closing Date, Parent shall, or Parent shall cause its Transfer Agent to, mail a letter of transmittal, in form and substance reasonably satisfactory to the Company and the Stockholder Representative (the “ Letter of Transmittal ”), to each Effective Time Company Stockholder at the address set forth opposite each such Effective Time Company Stockholder’s name on the Spreadsheet.

               (ii) Upon surrender of (A) a certificate representing their respective shares of Company Capital Stock, if any, or such other document(s) representing their right to receive their respective shares of Company Capital Stock, if any, or an affidavit in accordance with Section 2.12 , (B) a Company Warrant or (C) a Company Convertible Note, as the case may be (collectively, the “ Company Stock Certificates ”), for cancellation to Parent, together with the Letter of Transmittal, duly completed and executed in accordance with the instructions thereto, the holder of such Company Capital Stock, Company Warrant or Company Convertible Note shall be entitled to receive from Parent in exchange for the Company Stock Certificate(s), that portion of the Merger Consideration into which the shares of Company Capital Stock, Company Warrant or Company Convertible Note held by such holder have been converted pursuant to Section 2.7 . Upon the surrender of any such Company Stock Certificate(s), if any, the Company Stock Certificate(s) so surrendered shall thereupon be cancelled. Until so surrendered, each Company Stock Certificate outstanding after the Effective Time will be deemed, for all corporate purposes thereafter, to evidence only the right to receive the Merger Consideration payable in exchange for shares of Company Capital Stock, Company Warrant or Company Convertible Note (without interest) into which such shares of Company Capital Stock, Company Warrant or Company Convertible Note shall have been converted pursuant to Section 2.7 .

          (c) Post-Closing Payments . As soon as practicable following the determination of all or any portion of the Shortfall Amount, the following procedures shall apply:

               (i) To the extent that the Shortfall Amount is less than or equal to the amount of the Allocated Escrow Basket (the portion of the Shortfall Amount up to and including the Allocated Escrow Basket, the “ Initial Shortfall Amount ”), the Escrow Agent shall promptly release (and the Stockholder Representative and Parent shall each instruct the Escrow Agent to release) an amount of cash held in the Escrow Fund equal to the Initial Shortfall Amount by wire transfer of immediately available funds to an account designated in writing by Parent to the Escrow Agent.

               (ii) If the Shortfall Amount exceeds the amount of the Allocated Escrow Basket (such amount in excess of the Allocated Escrow Basket, the “ Excess Shortfall Amount ”), in Parent’s sole and absolute discretion, either:

                    (1) the Escrow Agent shall promptly release (and the Stockholder Representative and Parent shall each instruct the Escrow Agent to release) both the Allocated Escrow Basket and the Excess Shortfall Amount from the Escrow Fund by wire transfer of immediately available funds to an account designated in writing by Parent to the Escrow Agent; or

                    (2) the Escrow Agent shall promptly release (and the Stockholder Representative and Parent shall each instruct the Escrow Agent to release) an amount of cash held in the Escrow Fund equal to the Allocated Escrow Basket by wire transfer of immediately available funds to an account designated in writing by Parent to the Escrow Agent and the Company Stockholders shall promptly pay to Parent, in accordance with their respective Pro Rata Portions, an aggregate amount of cash equal to the Excess Shortfall Amount; provided, however , that if any Company Stockholder shall fail to so pay its respective Pro Rata

Portion of the Excess Shortfall Amount pursuant to and in accordance with this clause (2), Parent may (in its sole and absolute discretion) either commence legal proceedings to specifically enforce the terms of this clause (2) against such Company Stockholder and/or instruct the Escrow Agent to release from the Escrow Fund and deliver to Parent the difference between the Excess Shortfall Amount and the amount of money actually received by Parent from the Company Stockholders pursuant to this clause (2).

          (d) No Payments Until Company Stock Certificates Surrendered; Uncertificated Shares . To the extent that a Company Stock Certificate has been issued to a holder, no portion of the Merger Consideration shall be paid to the holder of any unsurrendered Company Stock Certificate with respect to shares of Company Capital Stock, Company Warrants or Company Convertible Notes formerly represented thereby until the holder of record of such Company Stock Certificate shall have surrendered such Company Stock Certificate (or complied with Section 2.12 ) together with a Letter of Transmittal pursuant hereto. To the extent that a Company Stock Certificate was not issued to a holder with respect to their shares of Company Capital Stock, Company Warrants or Company Convertible Notes, the Merger Consideration shall be paid to such holder with respect to such Company Capital Stock, Company Warrants or Company Convertible Notes upon such holder certifying in the Letter of Transmittal that it never was issued a Company Stock Certificate.

          (e) Transfers of Ownership . If any Merger Consideration is to be disbursed pursuant to Section 2.7(d) to a Person other than the Person whose name is reflected on the Company Stock Certificate, if any, surrendered in exchange therefor, it will be a condition of the issuance or delivery of the Merger Consideration in respect of such Company Stock Certificate that the Company Stock Certificate so surrendered is properly endorsed and otherwise in proper form for transfer and that the Person requesting such exchange will have provided to Parent or any agent designated by it reasonable evidence that any applicable transfer or other taxes have been paid.

          (f) No Liability . Notwithstanding anything to the contrary in this Section 2.10 , none of Parent, the Surviving Corporation, the Stockholder Representative or any other party hereto shall be liable to a holder of any shares of Company Capital Stock, Company Warrant or Company Convertible Note for any amount paid to a public official pursuant to any applicable abandoned property, escheat or similar Law.

     2.11 No Further Ownership Rights in Company Capital Stock . The Merger Consideration paid in respect of the surrender for exchange of shares of Company Capital Stock, Company Warrants or Company Convertible Notes in accordance with the terms of this Agreement shall be deemed to be full satisfaction of all rights pertaining to such shares of Company Capital Stock, Company Warrants or Company Convertible Notes and, from and after the Effective Time, there shall be no further registration of transfers on the records of the Surviving Corporation of shares of Company Capital Stock, Company Warrants or Company Convertible Notes which were outstanding immediately prior to the Effective Time. If, after the Effective Time, Company Stock Certificates are presented to the Surviving Corporation for any reason, they shall be canceled and exchanged as provided in this Article II .

     2.12 Lost, Stolen or Destroyed Certificates . In the event any Company Stock Certificates shall have been lost, stolen or destroyed, Parent shall issue in exchange for such lost, stolen or destroyed certificates, upon the making of an affidavit of that fact by the holder thereof, such amount, if any, as may be required pursuant to Section 2.7 ; provided , however , that Parent may, in its reasonable discretion and as a condition precedent to the issuance thereof, require the Person who is the owner of such lost, stolen or destroyed certificates to either (a) deliver a reasonable bond in such amount as it may reasonably direct, or (b) provide an indemnification agreement in a form and substance reasonably acceptable to Parent, against any claim that may be made against Parent with respect to the certificates alleged to have been lost, stolen or destroyed.

     2.13 Additional Adjustments to Merger Consideration . The per share amounts of the Merger Consideration payable to holders of Company Capital Stock, the Company Warrants and the Company Convertible Notes and any other applicable numbers or amounts, shall be adjusted as necessary to reflect appropriately the effect of any stock split, reverse stock split, stock dividend (including any dividend or distribution of securities convertible into Company Capital Stock), reorganization, recapitalization, reclassification or other like change with respect to Company Capital Stock or Parent Common Stock occurring or having a record date on or after the date hereof and prior to the Effective Time.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

     The Company hereby represents and warrants to Parent and Merger Sub, subject to such exceptions as are disclosed in the disclosure schedule (referencing the appropriate section, subsection, paragraph and subparagraph numbers) supplied by the Company to Parent prior to the execution of this Agreement (the “ Disclosure Schedule ”) and dated as of the date hereof, on the date hereof and as of the Effective Time, as though made at the Effective Time, as follows; ( provided, however, that any information disclosed in the Disclosure Schedule under any section, subsection, paragraph or clause shall be deemed disclosed and incorporated into any other section, subsection, paragraph or clause where the relevance of such exception to another representation or warranty would be reasonably apparent from the face of the disclosure (without having to refer to the underlying documents being disclosed):

     3.1 Organization of the Company .

          (a) The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. The Company has the requisite corporate power to own its properties and to carry on its business as currently 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 as would not reasonably be expected to have a Company Material Adverse Effect. The Company has made available 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. The Board of Directors of

the Company has not approved any amendment to any of the Charter Documents that are not otherwise reflected therein or contemplated by this Agreement.

          (b) Section 3.1(b) 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.

          (c) Section 3.1(c) of the Disclosure Schedule lists every state or foreign jurisdiction in which the Company has Current Employees or facilities or otherwise conducts operations.

     3.2 Company Capital Structure .

          (a) The authorized capital stock of the Company consists of Sixty Million (60,000,000) shares of Common Stock, of which One Million Seventy-Nine Thousand Four Hundred Twenty-Nine (1,079,429) shares are issued and outstanding as of the date hereof, and Twenty Million (20,000,000) shares of Company Preferred Stock, of which Five Million Two Hundred Fifty Thousand (5,250,000) shares are issued and outstanding as of the date hereof. All of the outstanding shares of Company Preferred Stock are designated as Company Series A Preferred Stock or Company Series B Preferred Stock. As of the date hereof, the capitalization of the Company is as set forth in Section 3.2(a) of the Disclosure Schedule. As of the date hereof, the Company Capital Stock is held of record by the Persons and in the amounts set forth in Section 3.2(a) of the Disclosure Schedule, which further sets forth for each such Person the number of shares held of record, class and/or series of such shares and the number of the applicable Company Stock Certificate, if any, representing such shares and each such Person’s address as set forth in the Company’s records. All outstanding shares of Company Capital Stock were duly authorized, validly issued, fully paid and non-assessable. The Company Capital Stock is not subject to preemptive rights created by statute, the Charter Documents, or any agreement to which the Company is a party or by which it is bound, other than pursuant to the Company’s Amended and Restated Right of First Refusal and Co-Sale Agreement, dated as of June 30, 2007 (the “ Co-Sale Agreement ”) and the Company’s the Investor Rights Agreement, dated as of June 30, 2007 (the “ IRA ”).

          (b) All outstanding shares of Company Capital Stock, Company Options and Company Warrants have been issued or repurchased (in the case of shares that were outstanding and repurchased by the Company) in compliance with all applicable federal, state, foreign or local statutes, laws, rules or regulations, including federal and state securities laws, and were issued, transferred and repurchased (in the case of shares that were outstanding and repurchased by the Company) in accordance with any right of first refusal or similar right or limitation, including those in the Charter Documents. The Company has not suffered or incurred any claim or loss, or received a notice or, to the Company’s knowledge, threat of a claim or loss, to or arising out of the issuance or repurchase of any Company Capital Stock or options or warrants to purchase Company Capital Stock. No Company Stockholder has exercised any right of redemption, if any, provided in the Certificate of Incorporation with respect to shares of the Company Series A Preferred Stock, and the Company has not received notice that any Company Stockholder intends to exercise such rights. There are no declared or accrued but unpaid dividends with respect to any shares of Company Capital Stock. Other than as set forth in

Section 3.2(a) of the Disclosure Schedule, the Company has no other capital stock authorized, issued or outstanding as of the date hereof.

          (c) As of the date hereof, the Company has no outstanding Company Restricted Shares.

          (d) Except for the Company Option Plan, the Company has never adopted, sponsored or maintained any stock option plan or any other plan or agreement providing for equity compensation to any person. The Company has reserved as of the date hereof Three Million Nine Hundred Nineteen Thousand One Hundred Seventy (3,919,170) shares of Company Common Stock for issuance to Employees and directors of and consultants to the Company upon exercise of awards granted under the Company Option Plan, of which (i) Three Million Four Hundred Nineteen Thousand Five Hundred and Seven (3,419,507) shares are issuable, as of the date hereof, upon the exercise of outstanding, unexercised stock options granted under the Company Option Plan and (ii) Four Hundred Ninety-Nine Thousand Six Hundred Sixty-Seven (499,667) shares remain available for future grant. Section 3.2(d) of the Disclosure Schedule sets forth for each outstanding Company Option as of the date hereof, the name of the holder of such Company Option, the address of such holder Company Option as reflected in the Company’s books and records, the number of shares of Company Capital Stock issuable upon the exercise of such Company Option, the exercise price of such Company Option, the date of grant of such Company Option, and the vesting schedule for such Company Option, including the extent vested to date and whether the vesting of such option is subject to acceleration as a result of the transactions contemplated by this Agreement or any other events (including a summary description of any such acceleration provisions). As of the date hereof, all Company Options are nonstatutory stock options and do not qualify as incentive stock options as defined under Section 422 of the Code. True and complete copies of any stock option agreements evidencing Company Options issued under the Company Option Plan have been made available to Parent or its representatives, and such agreements and instruments have not been amended, modified or supplemented and, other than as contemplated by this Agreement, there are no agreements to amend, modify or supplement such agreements or instruments from the forms thereof made available to Parent or its representatives. All holders of Company Options are Current Employees of the Company as of the date hereof.

          (e) There are no outstanding stockholder loans as of the date hereof. As of the date hereof, an aggregate of 33,333 shares of Company Series B Preferred Stock (or such other shares of the Company to be issued in any Qualified Financing (as defined in the Company Warrants)) are issuable upon the exercise of outstanding Company Warrants. As of the date hereof, the Company Convertible Notes have an outstanding aggregate principal amount of $1,000,000, accrue interest at a rate of 10% per annum, and are convertible into shares of Series B Preferred Stock (or such other shares of the Company to be issued in any Qualified Financing (as defined in the Company Convertible Notes)) at a conversion rate of $3.00 per share.

          (f) Except for the outstanding Company Series A Preferred Stock, Company Series B Preferred Stock, Company Convertible Notes, Company Options and Company Warrants described above, as of the date hereof, there are no options, warrants, calls, rights, convertible securities, commitments or agreements 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 the 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, commitment or agreement, other than as contemplated or required by this Agreement. There are no outstanding or authorized stock appreciation, phantom stock, profit participation, or other similar rights with respect to the Company. Except as contemplated or required by this Agreement or the Related Agreements or pursuant to the Co-Sale Agreement and the IRA, there are no voting trusts, proxies, or other agreements or understandings with respect to the voting stock of the Company to which the Company is a party. Other than the Co-Sale Agreement and the IRA, there are no agreements 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.

          (g) The information contained in the Spreadsheet will be true and correct in all material respects as of the Closing Date (other than address information, which is based solely on the Company’s books and records) and the allocation of the Closing Adjusted Merger Consideration as set forth in the Spreadsheet will be consistent in all material respects with the Charter Documents.

     3.3 Subsidiaries .

          (a) Section 3.3(a) of the Disclosure Schedule lists each Subsidiary of the Company as of the date hereof.

          (b) Other than the Subsidiaries listed in Section 3.3(a) of the Disclosure Schedule, the Company does not have any Subsidiaries and does not otherwise own, and has not owned, ten (10) percent or more of the shares of capital stock of, or equity interest in, or otherwise control, directly or indirectly, any other corporation, limited liability company, partnership, association, joint venture or other business entity. The Company has not agreed nor is it obligated to make any future investment in or capital contribution to any Person.

     3.4 Authority .

          (a) The Company has the requisite corporate power and authority to execute and deliver this Agreement, perform its obligations hereunder and, subject to obtaining the Requisite Stockholder Approval, consummate the Merger and the other transactions contemplated hereby to which it is a party. The execution and delivery of this Agreement by the Company, the performance by it of its obligations hereunder and the consummation by it of the Merger and the other transactions contemplated hereby to which it is a party have been duly authorized by all necessary corporate actions on the part of the Company and no other corporate proceedings on the part of the Company are necessary for it to authorize this Agreement or to consummate the Merger and the other transactions contemplated hereby to which it is a party, other than the Requisite Stockholder Approval. This Agreement has been duly and validly executed and delivered by the Company and, assuming the due authorization, execution and delivery by Parent, Merger Sub and the Escrow Agent, constitutes a legal, valid and binding obligation of the Company, enforceable against it in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws

now or hereafter in effect relating to creditors’ rights generally and subject to general principles of equity.

          (b) Prior to the execution and delivery of this Agreement by the Company, the Board of Directors of the Company unanimously adopted resolutions (i) determining that the terms of the Merger are advisable, fair to and in the best interests of the Company and the Company Stockholders, (ii) approving this Agreement, the Merger and the other transactions contemplated hereby to which the Company is a party and (iii) recommending that the Company Stockholders adopt this Agreement.

          (c) The affirmative vote or written consent of (i) the holders of a majority of the outstanding Company Common Stock and the Company Series A Preferred Stock, voting together and on an as-converted basis for the Company Series A Preferred Stock as provided for in the Certificate of Incorporation, and (ii) the holders of a majority of the Company Series A Preferred Stock, voting as a separate class ((i) and (ii) together, the “ Requisite Stockholder Approval ”), are the only votes of the holders of any class or series of the Company Capital Stock necessary, under applicable Law or otherwise, to approve and adopt this Agreement, the Merger and the other transactions contemplated hereby to which the Company is a party (collectively, the " Company Voting Proposals ”).

     3.5 No Conflict . The execution and delivery by the Company of this Agreement and any Related Agreements to which the Company is a party, and the consummation by the Company of the transactions contemplated hereby and thereby, will not (a) conflict with or result in any material violation of any provision of the Charter Documents (b) 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 material benefit under (any such event, a “ Conflict ”) any Material Contract, or (c) conflict with or result in any material violation of any judgment, order, decree binding on, or material statute, law, ordinance, rule or regulation applicable to, the Company or any of its properties or assets (whether tangible or intangible). Section 3.5 of the Disclosure Schedule sets forth all necessary consents, notices, waivers and approvals of parties to any Material Contracts as are required thereunder in connection with the Merger, or for any such Contract to remain in full force and effect without limitation, modification or alteration after the Effective Time so as to preserve all rights of, and benefits to, the Company under such Contracts from and after the Effective Time. Following the Effective Time, the Surviving Corporation will be permitted to exercise all of its rights under the Contracts without the payment of any additional amounts or consideration other than ongoing fees, royalties or payments which the Company would otherwise be required to pay pursuant to the terms of such Contracts had the transactions contemplated by this Agreement not occurred.

     3.6 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 or local or foreign governmental authority, instrumentality, agency or commission (each, a “ Governmental Entity ”) or any third party is required by, or with respect to, the Company in connection with the execution and delivery of this Agreement and any Related Agreements to which the Company is a party or the consummation by the Company of the Merger or the other transactions contemplated hereby and thereby, except for (a) the filing of the

Certificate of Merger with the Secretary of State of the State of Delaware, (b) the adoption of this Agreement by the Requisite Stockholder Approval, (c) the filing of notification and report forms with the Federal Trade Commission (“ FTC ”) and the Department of Justice (“ DOJ ”) required by the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “ HSR Act ”) and the expiration or termination of the applicable waiting period under the HSR Act or any other foreign merger control regulations (“ Foreign Antitrust Laws ”), (d) the issuance by the California Commissioner of Corporations (the " California Commissioner ”) of the permit (the “ California Permit ”) under Section 25121 of the California Corporate Securities Law of 1968, as amended, and the rules and regulations promulgated thereunder (“ California Securities Law ”) for the qualification of the offer and sale of the Parent Common Stock as part of the Merger Consideration, (e) the consents, waivers and approvals listed in Section 3.6 of the Disclosure Schedule, and (f) any such other consents, waivers, approvals, orders, authorizations, registrations, declarations and filings which if not obtained or made would not be material to the Company and its Subsidiaries taken as a whole or materially adversely affect the ability of the Company to consummate the Merger on or before the Final Date.

     3.7 Company Financial Statements .

          (a) Section 3.7(a)(i) of the Disclosure Schedule sets forth the Company’s unaudited consolidated balance sheet as of June 30, 2007 (the “ Balance Sheet Date ”), and the related unaudited consolidated statements of income, cash flow and stockholders’ equity for the three months then ended (the “ Interim Financials ”). Section 3.7(a)(ii) of the Disclosure Schedule sets forth the Company’s audited consolidated balance sheets as of December 31, 2004, 2005 and 2006 and the related consolidated statements of income, cash flow and stockholders’ equity for the twelve-month periods ended December 31, 2004, 2005, and 2006 (the “ Audited Financials ”, and together with the Interim Financials, the “ Financials ”). The Financials have been prepared in accordance with GAAP applied on a consistent basis throughout the periods indicated and consistent with each other (except as noted therein and 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 condition, operating results and cash flows as of the dates and during the periods indicated therein, subject in the case of the Interim Financials to normal recurring year-end adjustments and the absence of footnotes. The Company’s unaudited consolidated balance sheet as of the Balance Sheet Date is referred to hereinafter as the " Current Balance Sheet .”

           (b) Schedule 3.7(b) sets forth the Company’s financial forecast as of June 30, 2007 (the " Forecast ”). The Company does not represent or warrant that the Forecast will prove to be accurate in any respect; provided, however, that the Company does represent that the Forecast were made in good faith.

     3.8 No Undisclosed Liabilities . The Company does not have any material liability, indebtedness, obligation, expense, claim, deficiency or guaranty of any type, whether accrued, absolute, contingent, matured, unmatured or other (whether or not required to be reflected in the Financials in accordance with GAAP), except for those which (a) have been reflected on the Current Balance Sheet or (b) have arisen in the ordinary course of business consistent with past practices since the Balance Sheet Date.

     3.9 No Changes . Except as contemplated or required by this Agreement or as consented to by Parent in writing pursuant to Article V , during the period from the Balance Sheet Date to the date of this Agreement, and during the period from and after the Date of this Agreement to the Closing Date, there has not been, occurred or arisen any:

          (a) material transaction by the Company except in the ordinary course of business as conducted on that date and consistent with past practices;

          (b) modification, amendment or change to the Charter Documents;

          (c) expenditure, transaction or commitment exceeding $35,000 individually or $150,000 in the aggregate by the Company;

          (d) payment, discharge, waiver or satisfaction, in any amount in excess of $35,000 in any one case, or $150,000 in the aggregate, of any claim, liability, right or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise of the Company), other than payments, discharges or satisfactions in the ordinary course of business of liabilities reflected or reserved against on the Current Balance Sheet;

          (e) material destruction of, damage to, or loss of any material assets (whether tangible or intangible and whether or not covered by insurance), material business or material customer of the Company;

          (f) material employment dispute, including material claims or matters raised by any individual, Governmental Entity, or workers’ representative organization, bargaining unit or union, regarding, claiming or alleging labor trouble, wrongful discharge or any other unlawful employment or labor practice or action with respect to the Company;

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

          (h) adoption of or change in any material election in respect of Taxes other than in the ordinary course of business, adoption or change in any material accounting method in respect of Taxes other than in the ordinary course of business, agreement or settlement of any claim or assessment in respect of material Taxes, or extension or waiver of the limitation period applicable to any claim or assessment in respect of material Taxes (other than by reason of filing a Return within an automatically extended filing period);

          (i) revaluation by the Company of any material portion of its assets (whether tangible or intangible), including writing down the value of inventory or writing off notes or accounts receivable, other than in the ordinary course of business consistent with past practice;

          (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,

-33-

redemption, or other acquisition by the Company of any shares of Company Capital Stock (or options, warrants or other rights convertible into, exercisable or exchangeable therefor);

          (k) (i) increase in or other material change to the salary or other compensation (including equity based compensation) payable or to become payable by the Company to any of its respective officers or directors or any material increase in or other material change to the salary or other compensation (including equity based compensation) payable or to become payable by the Company to any of its Current Employees or consultants or (ii) declaration, payment or commitment or obligation of any kind for the payment (whether in cash or equity) by the Company of a severance payment, termination payment, bonus, special remuneration or other additional salary or compensation (including equity based compensation), in each case to any of its officers or directors or declaration, payment or commitment or obligation of any kind for the material payment (whether in cash or equity) by the Company of a severance payment, termination payment, bonus, special remuneration or other additional salary or compensation (including equity based compensation), in each case to any of its Current Employees or consultants;

          (l) entering into any Material Contract or any termination, extension, amendment or modification of the terms of any Material Contract;

          (m) sale, lease, license or other disposition of any of the assets (whether tangible or intangible) or properties of the Company, including the sale of any accounts receivable of the Company, or any creation of any security interest in such assets or properties, in each case other than in the ordinary course of business consistent with past practice;

          (n) loan by the Company to any Person (except for advances to Employees for travel and business expenses in the ordinary course of business consistent with past practices), or purchase by the Company of any debt securities of any Person or amendment to the terms of any outstanding loan agreement;

          (o) incurring by the Company of any indebtedness, amendment of the terms of any outstanding loan agreement, guaranteeing by the Company of any indebtedness, issuance or sale of any debt securities of the Company or guaranteeing of any debt securities of others, except for obligations to reimburse Employees for travel and business expenses incurred in the ordinary course of business consistent with past practices;

          (p) waiver or release of any material right or claim of the Company, including any waiver, release or other compromise of any material account receivable of the Company;

          (q) commencement or settlement of any lawsuit by the Company, the commencement, settlement, written notice or, to the knowledge of the Company, threat or other notice of any lawsuit or proceeding or other investigation against the Company or relating to any of their businesses, properties or assets;

          (r) written notice of any claim or potential claim of ownership, interest or right by any Person other than the Company of any of the Company Material Intellectual Property or of infringement by the Company of any other Person’s Intellectual Property;

          (s) issuance, grant, delivery, sale or purchase of, or proposal, Contract to issue, grant, deliver, sell or purchase, by the Company, of (i) any shares of Company Capital Stock or securities convertible into, or exercisable or exchangeable for, shares of Company Capital Stock, or (ii) any subscriptions, warrants, options, rights or securities to acquire any of the foregoing, except for issuances of Company Capital Stock upon the exercise of options issued under the Company Option Plan;

          (t) other than entering into (y) non-exclusive licenses and related agreements with respect thereto of the Company Products with a retail value (i.e. full price on Company’s standard price list) of less than $35,000 to end users pursuant to written agreements in the ordinary course of business that do not materially differ in substance from the Company’s standard form(s) including attachments (which are included in Section 3.14(k) of the Disclosure Schedule) or that, if different from the standard form, do not contain any terms that are materially less favorable to the Company than the corresponding term of the standard form, or (z) agreements relating solely to licensing of Shrink-Wrapped Code to the Company for its own use entered into in the ordinary course of business: (i) sale, lease, license or transfer of any Company Intellectual Property or execution, modification or amendment of any agreement with respect to Company Intellectual Property with any Person or with respect to the Intellectual Property of any Person, or (ii) purchase or license of any Intellectual Property or execution, modification or amendment of any agreement with respect to the Intellectual Property of any Person involving aggregate payments by the Company in excess of $150,000, (iii) agreement or modification or amendment of an existing agreement with respect to the development of any Intellectual Property with a third party involving aggregate payments by the Company in excess of $150,000, or (iv) material change in pricing or royalties set or charged by the Company to its customers or licensees or in pricing or royalties set or charged by Persons who have licensed Intellectual Property to the Company;

          (u) a Company Material Adverse Effect;

          (v) purchase or sale of any interest in real property, entry into or renewal, amendment or modification of any lease, license, sublease or other occupancy of any Leased Real Property or other real property by the Company;

          (w) acquisition by the Company of, or agreement by the Company to acquire by merging or consolidating with, or by purchasing any 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 or agreement to acquire any assets or any equity securities that are material, individually or in the aggregate, to the Company;

          (x) adoption or amendment of any Company Employee Plan, or execution or amendment of any Employee Agreement (other than execution of the Company standard at will offer letter);

          (y) execution of any strategic alliance, affiliate or joint marketing arrangement or agreement by the Company;

          (z) any action to accelerate the vesting schedule of any Company Options or Company Common Stock;

          (aa) promotion, demotion or termination or other change to the employment status or title of any Current Employee;

          (bb) alteration of any interest of the Company in a Subsidiary or any corporation, association, joint venture, partnership or business entity in which the Company directly or indirectly holds any ownership interest;

          (cc) cancellation, amendment or renewal of any insurance policy of the Company;

          (dd) issuance or agreement to issue any refunds, credits, allowances or other concessions with customers with respect to amounts collected by or owed to the Company in excess of $35,000 individually or $150,000 in the aggregate; or

          (ee) agreement by the Company to do any of the things described in the preceding clauses (a) through (dd) of this Section 3.9 (other than negotiations with Parent and its representatives regarding the transactions contemplated by this Agreement and any Related Agreements).

     3.10 Accounts Receivable .

          (a) The Company has made available to Parent or its representatives a list of all accounts receivable, whether billed or unbilled, of the Company as of the Balance Sheet Date, together with an aging schedule (of only billed accounts receivable) indicating a range of days elapsed since invoice.

          (b) All of the accounts receivable, whether billed or unbilled, of the Company reflected on the Current Balance Sheet arose, and any to be reflected on the Company’s Closing Company Balance Sheet will have arisen, in the ordinary course of business, are carried at values determined in accordance with GAAP consistently applied, to the knowledge of the Company are not subject to any set-off or counterclaim, do not represent obligations for goods sold on consignment, on approval or on a sale-or-return basis or subject to any other repurchase or return arrangement and, to the knowledge of the Company, are collectible except to the extent of reserves therefor set forth in the Current Balance Sheet. No Person has any Lien on any accounts receivable of the Company and no written request or Contract for material deduction or discount has been made with respect to any accounts receivable of the Company.

     3.11 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, provincial, local and foreign taxes and other similar governmental charges, including taxes based upon or measured by gross receipts, income, profits, sales, use and occupation, capital and value added goods and services, ad valorem, transfer, franchise, withholding, payroll, social security, unemployment, workers’ compensation, recapture, employment, excise and property or other taxes of any kind

-36-

whatsoever, 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 3.11(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 3.11(a) as a result of any express or implied obligation to indemnify any other Person or as a result of any obligation under any agreement or arrangement 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 has (a) timely filed all required federal, state, provincial, local and foreign returns, estimates, information statements, elections, forms, transfer pricing studies and reports (“ Returns ”) relating to any and all Taxes concerning or attributable to the Company or its operations and such Returns are true and correct and have been completed in accordance with applicable Law, in all material respects, and (b) timely paid all material Taxes required to be paid, whether or not shown to be due on such Returns.

               (ii) The Company has paid or withheld with respect to its Employees and other third parties and from any related Person, all federal, state, provincial 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 paid or withheld by the Company, and have timely paid such withheld Taxes over to the appropriate authorities.

               (iii) There is no Tax deficiency outstanding, assessed or, to the knowledge of the Company, proposed in writing, against the Company, nor has the Company executed any waiver of any statute of limitations on or extending the period for the assessment or collection of any Tax that remains outstanding.

               (iv) No audit or other examination of any Return of the Company is presently in progress, nor has the Company been notified in writing of any request for such an audit or other examination that has not commenced.

               (v) The Current Balance Sheet sets forth, in accordance with GAAP, the liabilities of the Company for Taxes due as of the Balance Sheet Date and the Company has not incurred any liability for Taxes since the Balance Sheet Date other than in the ordinary course of business.

               (vi) The Company has made available to Parent or its representatives, copies of all Returns for the Company filed for all periods since the period beginning January 1, 2003.

               (vii) There are (and immediately following the Merger Closing Date there will be) no Liens on the assets of the Company relating to or attributable to Taxes other than Liens for Taxes not yet delinquent.

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

               (ix) The Company has (a) never been a member of an affiliated group (within the meaning of Code §1504(a)) filing a consolidated federal income Tax Return (other than a group the common parent of which was Company), (b) never been a party to any Tax sharing, indemnification or allocation agreement, other than standard provisions in leases or other contracts with customers, suppliers or other third parties entered into in the ordinary course of business, and (c) no liability for the Taxes of any Person (other than Company), under Treasury Regulation § 1.1502-6 (or any similar provision of state, local or foreign law, and including any arrangement for group relief within a jurisdiction or similar arrangement), as a transferee or successor, by contract or agreement, or otherwise, other than by reason of standard provisions in leases or other contracts with customers, suppliers or other third parties entered into in the ordinary course of business.

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

               (xi) The Company has not 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 would 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.

               (xii) The Company has not engaged in a “reportable transaction” as set forth in Treasury Regulation Section 1.6011-4(b)(2), or any 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).

               (xiii) The Company will not be required to include any income or gain or exclude any deduction or loss from