{"id":41230,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/purchase-agreement-notes-digital-river-inc.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"purchase-agreement-notes-digital-river-inc","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/finance\/purchase-agreement-notes-digital-river-inc.html","title":{"rendered":"Purchase Agreement – Notes – Digital River Inc."},"content":{"rendered":"

$300,000,000<\/strong><\/p>\n

\n

DIGITAL RIVER, INC.<\/strong><\/p>\n

\n

2.00% CONVERTIBLE SENIOR NOTES DUE 2030
\nCOMMON STOCK, PAR VALUE $0.01<\/strong><\/p>\n

\n

PURCHASE AGREEMENT<\/strong><\/p>\n

\n

October 26, 2010<\/p>\n<\/p>\n\n\n\n
<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
\n

size=2 width=”100%” noshade style=’color:#A0A0A0′ align=center><\/p>\n\n\n\n
<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

October 26, 2010<\/p>\n

Merrill Lynch, Pierce, Fenner & Smith Incorporated
\nMorgan Stanley & Co. Incorporated<\/p>\n

As Representatives of the several Initial Purchasers named in Schedule I
\nhereto<\/p>\n

c\/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
\nOne Bryant Park
\nNew York, NY 10036<\/p>\n

c\/o Morgan Stanley & Co. Incorporated
\n1585 Broadway
\nNew York, NY 10036<\/p>\n

Ladies and Gentlemen:<\/p>\n

Digital River, Inc., a Delaware corporation (the
\n“Company<\/strong>“), proposes to issue and sell to the several
\npurchasers named in Schedule I hereto (the “Initial
\nPurchasers<\/strong>“), for whom you are acting as representatives (the
\n“Representatives<\/strong>“), $300,000,000 principal amount of its 2.00%
\nConvertible Senior Notes due 2030 (the “Firm Securities<\/strong>“) to be
\nissued pursuant to the provisions of an Indenture dated as of the Closing Date
\n(as defined in Section 4) (the “Indenture<\/strong>“) between the Company
\nand Wells Fargo Bank, National Association, as Trustee (the
\n“Trustee<\/strong>“). The Company also proposes to issue and sell to the
\nInitial Purchasers not more than an additional $45,000,000 principal amount of
\nits 2.00% Convertible Senior Notes due 2030 (the “Additional
\nSecurities<\/strong>“) if and to the extent that you, as Representatives of the
\noffering, shall have determined to exercise, on behalf of the Initial
\nPurchasers, the right to purchase such 2.00% Convertible Senior Notes due 2030
\ngranted to the Initial Purchasers in Section 2 hereof. The Firm Securities and
\nthe Additional Securities are hereinafter collectively referred to as the
\n“Securities<\/strong>“. The Securities will be convertible into shares of
\ncommon stock, par value $0.01, of the Company (the “Underlying
\nSecurities<\/strong>“).<\/p>\n

The Securities and the Underlying Securities will be offered without being
\nregistered under the Securities Act of 1933, as amended (the
\n“Securities Act<\/strong>“), to qualified institutional buyers in
\ncompliance with the exemption from registration provided by Rule 144A under the
\nSecurities Act.<\/p>\n

In connection with the sale of the Securities, the Company has prepared a
\npreliminary offering memorandum (the “Preliminary Memorandum<\/strong>“)
\nand will prepare a final offering memorandum (the “Final
\nMemorandum<\/strong>“) including or incorporating by reference a description of
\nthe terms of the Securities and the<\/p>\n

\n

size=2 width=”100%” noshade style=’color:#A0A0A0′ align=center><\/p>\n

Underlying Securities, the terms of the offering and a description of the
\nCompany. For purposes of this Agreement, “Additional Written Offering
\nCommunication<\/strong>” means any written communication (as defined in Rule 405
\nunder the Securities Act) that constitutes an offer to sell or a solicitation of
\nan offer to buy the Securities other than the Preliminary Memorandum or the
\nFinal Memorandum, and “Time of Sale Memorandum<\/strong>” means the
\nPreliminary Memorandum together with the Additional Written Offering
\nCommunications, if any, each identified in Schedule III hereto. As used herein,
\nthe terms Preliminary Memorandum, Time of Sale Memorandum and Final Memorandum
\nshall include the documents, if any, incorporated by reference therein. The
\nterms “supplement<\/strong>“, “amendment<\/strong>” and
\n“amend<\/strong>” as used herein with respect to the Preliminary
\nMemorandum, the Time of Sale Memorandum, the Final Memorandum or any Additional
\nWritten Offering Communication shall include all documents subsequently filed by
\nthe Company with the Securities and Exchange Commission (the
\n“Commission<\/strong>“) pursuant to the Securities Exchange Act of 1934,
\nas amended (the “Exchange Act<\/strong>“), that are deemed to be
\nincorporated by reference therein.<\/p>\n

1. Representations and Warranties<\/em>. The Company represents and
\nwarrants to, and agrees with, you that:<\/p>\n

(a) (i) Each document, if any, filed or to be filed pursuant to the Exchange
\nAct and incorporated by reference in the Preliminary Memorandum, the Time of
\nSale Memorandum or the Final Memorandum complied or will comply when so filed in
\nall material respects with the Exchange Act and the applicable rules and
\nregulations of the Commission thereunder, (ii) the Time of Sale Memorandum does
\nnot, and at the time of each sale of the Securities in connection with the
\noffering when the Final Memorandum is not yet available to prospective
\npurchasers and at the Closing Date (as defined in Section 4), the Time of Sale
\nMemorandum, as then amended or supplemented by the Company, if applicable, will
\nnot, contain any untrue statement of a material fact or omit to state a material
\nfact necessary to make the statements therein, in the light of the circumstances
\nunder which they were made, not misleading, (iii) the Preliminary Memorandum
\ndoes not contain and the Final Memorandum, in the form used by the Initial
\nPurchasers to confirm sales and on the Closing Date (as defined in Section 4),
\nwill not contain any untrue statement of a material fact or omit to state a
\nmaterial fact necessary to make the statements therein, in the light of the
\ncircumstances under which they were made, not misleading, except that the
\nrepresentations and warranties set forth in this paragraph do not apply to
\nstatements or omissions in the Preliminary Memorandum, the Time of Sale
\nMemorandum or the Final Memorandum based upon information relating<\/p>\n

2<\/p>\n

\n

\n

to any Initial Purchaser furnished to the Company in writing by such Initial
\nPurchaser through you expressly for use therein.<\/p>\n<\/p>\n

(b) Except for the Additional Written Offering Communications, if any,
\nidentified in Schedule III hereto, and electronic road shows, if any, furnished
\nto you before first use, the Company has not prepared, used or referred to, and
\nwill not, without your prior consent, prepare, use or refer to, any Additional
\nWritten Offering Communication.<\/p>\n<\/p>\n

(c) The Company has been duly incorporated, is validly existing as a
\ncorporation in good standing under the laws of the jurisdiction of its
\nincorporation, has the corporate power and authority to own its property and to
\nconduct its business as described in the Time of Sale Memorandum and is duly
\nqualified to transact business and is in good standing in each jurisdiction in
\nwhich the conduct of its business or its ownership or leasing of property
\nrequires such qualification, except to the extent that the failure to be so
\nqualified or be in good standing would not have a material adverse effect on the
\nCompany and its subsidiaries, taken as a whole.<\/p>\n<\/p>\n

(d) Each subsidiary of the Company listed on Schedule II hereto has been duly
\nincorporated, is validly existing as a corporation in good standing under the
\nlaws of the jurisdiction of its incorporation, has the corporate power and
\nauthority to own its property and to conduct its business as described in the
\nTime of Sale Memorandum and is duly qualified to transact business and is in
\ngood standing in each jurisdiction in which the conduct of its business or its
\nownership or leasing of property requires such qualification, except to the
\nextent that the failure to be so qualified or be in good standing would not have
\na material adverse effect on the Company and its subsidiaries, taken as a whole;
\nall of the issued shares of capital stock of each subsidiary of the Company
\nlisted on Schedule II hereto have been duly and validly authorized and issued,
\nare fully paid and non-assessable and are owned directly or indirectly by the
\nCompany, free and clear of all liens, encumbrances, equities or claims. The
\nsubsidiaries listed on Schedule II hereto are the only “significant
\nsubsidiaries” of the Company as that term is defined in Rule 1-02 of Regulation
\nS-X under the Exchange Act.<\/p>\n<\/p>\n

(e) This Agreement has been duly authorized, executed and delivered by the
\nCompany.<\/p>\n<\/p>\n

(f) The authorized capital stock of the Company conforms as to legal matters
\nto the description thereof contained in each of the Time of Sale Memorandum and
\nthe Final Memorandum.<\/p>\n<\/p>\n

3<\/p>\n

\n

\n

(g) The shares of the Company153s common stock outstanding prior to the
\nissuance of the Securities have been duly authorized and are validly issued,
\nfully paid and non-assessable.<\/p>\n<\/p>\n

(h) The Securities have been duly authorized and, when executed and
\nauthenticated in accordance with the provisions of the Indenture and delivered
\nto and paid for by the Initial Purchasers in accordance with the terms of this
\nAgreement, will be valid and binding obligations of the Company, enforceable in
\naccordance with their terms, subject to applicable bankruptcy, insolvency and
\nsimilar laws affecting creditors153 rights generally and equitable principles of
\ngeneral applicability, and will be entitled to the benefits of the Indenture
\npursuant to which such Securities are to be issued. The issuance of such
\nSecurities will not be subject to any preemptive or similar rights.<\/p>\n<\/p>\n

(i) The Underlying Securities issuable upon conversion of the Securities have
\nbeen duly authorized and reserved and, when issued upon conversion of the
\nSecurities in accordance with the terms of the Securities, will be validly
\nissued, fully paid and non-assessable, and the issuance of the Underlying
\nSecurities will not be subject to any preemptive or similar rights.<\/p>\n<\/p>\n

(j) The Indenture has been duly authorized, and when executed and delivered
\nby the Company on the Closing Date, will be a valid and binding agreement of the
\nCompany, enforceable in accordance with its terms, subject to applicable
\nbankruptcy, insolvency and similar laws affecting creditors153 rights generally
\nand equitable principles of general applicability.<\/p>\n<\/p>\n

(k) The execution and delivery by the Company of, and the performance by the
\nCompany of its obligations under, this Agreement , the Indenture and the
\nSecurities will not contravene (i) in any material respect any provision of
\napplicable law, (ii) any provision of the certificate of incorporation or by
\nlaws of the Company, (iii) any agreement or other instrument binding upon the
\nCompany or any of its subsidiaries that is material to the Company and its
\nsubsidiaries, taken as a whole, or (iv) in any material respect any judgment,
\norder or decree of any governmental body, agency or court having jurisdiction
\nover the Company or any subsidiary. No consent, approval, authorization or order
\nof, or qualification with, any governmental body or agency is required for the
\nperformance by the Company of its obligations under this Agreement , the
\nIndenture or the Securities, except (1) such as may be required by the
\nsecurities or Blue Sky laws of the various states in connection with the offer
\nand sale of the Securities., (2) the notification to The NASDAQ<\/p>\n<\/p>\n

4<\/p>\n

\n

\n

Stock Market, Inc. (“NASDAQ”) for the listing of the Underlying Securities or
\n(3) such as have already been obtained.<\/p>\n<\/p>\n

(l) There has not occurred any material adverse change, or any development
\nreasonably expected to have a prospective material adverse change, in the
\ncondition, financial or otherwise, or in the earnings, business or operations of
\nthe Company and its subsidiaries, taken as a whole, from that set forth in the
\nTime of Sale Memorandum provided to prospective purchasers of the Securities.\n<\/p>\n<\/p>\n

(m) The financial statements and the related notes thereto of the Company and
\nits consolidated subsidiaries included or incorporated by reference in the Time
\nof Sale Memorandum present fairly, in all material respects, the financial
\nposition of the Company and its consolidated subsidiaries as of the dates
\nindicated and the results of their operations and the changes in their cash
\nflows for the periods specified; such financial statements have been prepared in
\nconformity with U.S. generally accepted accounting principles (“GAAP”) applied
\non a consistent basis throughout the periods covered thereby.<\/p>\n<\/p>\n

(n) Other than proceedings accurately described in all material respects in
\nthe Time of Sale Memorandum, there are no legal or governmental proceedings
\npending or, to the Company153s knowledge, threatened to which the Company or any
\nof its subsidiaries is a party or to which any of the properties of the Company
\nor any of its subsidiaries is subject that would have a material adverse effect
\non the Company and its subsidiaries, taken as a whole, or on the power or
\nability of the Company to perform its obligations under this Agreement, the
\nIndenture or the Securities or to consummate the transactions contemplated by
\nthe Time of Sale Memorandum.<\/p>\n<\/p>\n

(o) The Company and its subsidiaries (i) are in compliance with any and all
\napplicable foreign, federal, state and local laws and regulations relating to
\nthe protection of human health and safety, the environment or hazardous or toxic
\nsubstances or wastes, pollutants or contaminants (“Environmental
\nLaws<\/strong>“), (ii) have received all permits, licenses or other approvals
\nrequired of them under applicable Environmental Laws to conduct their respective
\nbusinesses as described in the Time of Sale Memorandum and (iii) are in
\ncompliance with all terms and conditions of any such permit, license or
\napproval, except where such noncompliance with Environmental Laws, failure to
\nreceive required permits, licenses or other approvals or failure to comply with
\nthe terms and conditions of such permits, licenses or approvals would not,
\nsingly or<\/p>\n<\/p>\n

5<\/p>\n

\n

\n

in the aggregate, have a material adverse effect, or prospective material
\nadverse effect, on the Company and its subsidiaries, taken as a whole.<\/p>\n<\/p>\n

(p) There are no costs or liabilities associated with Environmental Laws
\n(including, without limitation, any capital or operating expenditures required
\nfor clean-up, closure of properties or compliance with Environmental Laws or any
\npermit, license or approval required of the Company or its subsidiaries under
\napplicable Environmental Laws and any potential liabilities to third parties)
\nwhich would, singly or in the aggregate, have a material adverse effect on the
\nCompany and its subsidiaries, taken as a whole.<\/p>\n<\/p>\n

(q) The Company is not, and after giving effect to the offering and sale of
\nthe Securities and the application of the proceeds thereof as described in the
\nFinal Memorandum will not be, required to register as an “investment company” as
\nsuch term is defined in the Investment Company Act of 1940, as amended (the
\n“Investment Company Act<\/strong>“).<\/p>\n<\/p>\n

(r) Neither the Company nor any affiliate (as defined in Rule 501(b) of
\nRegulation D under the Securities Act, an “Affiliate<\/strong>“) of the
\nCompany has directly, or through any agent, (i) sold, offered for sale,
\nsolicited offers to buy or otherwise negotiated in respect of, any security (as
\ndefined in the Securities Act) which is or will be integrated with the sale of
\nthe Securities in a manner that would require the registration under the
\nSecurities Act of the Securities or (ii) offered, solicited offers to buy or
\nsold the Securities by any form of general solicitation or general advertising
\n(as those terms are used in Regulation D under the Securities Act) or in any
\nmanner involving a public offering within the meaning of Section 4(2) of the
\nSecurities Act, except no representation, warranty or agreement is made by the
\nCompany in this paragraph with respect to the Initial Purchasers.<\/p>\n<\/p>\n

(s) Assuming the representations of the Initial Purchasers set forth in
\nSection 7 are true and correct, it is not necessary in connection with the
\noffer, sale and delivery of the Securities to the Initial Purchasers in the
\nmanner contemplated by this Agreement to register the Securities under the
\nSecurities Act or to qualify the Indenture under the Trust Indenture Act of
\n1939, as amended.<\/p>\n<\/p>\n

(t) The Securities satisfy the requirements set forth in Rule 144A(d)(3)
\nunder the Securities Act.<\/p>\n<\/p>\n

6<\/p>\n

\n

\n

(u) Neither the Company nor any of its subsidiaries, nor any director,
\nofficer or, to the Company153s knowledge, any employee, agent, affiliate or
\nrepresentative of the Company or of any of its subsidiaries or affiliates, has
\ntaken or will take any action in furtherance of an offer, payment, promise to
\npay, or authorization or approval of the payment or giving of money, property,
\ngifts or anything else of value, directly or indirectly, to any “government
\nofficial” (including any officer or employee of a government or government-owned
\nor controlled entity or of a public international organization, or any person
\nacting in an official capacity for or on behalf of any of the foregoing, or any
\npolitical party or party official or candidate for political office) to
\ninfluence official action or secure an improper advantage; and the Company and
\nits subsidiaries and, to the Company153s knowledge, its affiliates have conducted
\ntheir respective businesses as described in the Time of Sale Memorandum in
\ncompliance with applicable anti-corruption laws and have instituted and maintain
\nand will continue to maintain policies and procedures designed to promote and
\nachieve compliance with such laws and with the representation and warranty
\ncontained herein.<\/p>\n<\/p>\n

(v) The operations of the Company and its subsidiaries are and have been
\nconducted at all times in material compliance with all applicable financial
\nrecordkeeping and reporting requirements, including those of the Bank Secrecy
\nAct, as amended by Title III of the Uniting and Strengthening America by
\nProviding Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
\n2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of
\njurisdictions where the Company and its subsidiaries conduct their respective
\nbusinesses as described in the Time of Sale Memorandum, the rules and
\nregulations thereunder and any related or similar rules, regulations or
\nguidelines, issued, administered or enforced by any governmental agency
\n(collectively, the “Anti-Money Laundering Laws<\/strong>“), and no
\naction, suit or proceeding by or before any court or governmental agency,
\nauthority or body or any arbitrator involving the Company or any of its
\nsubsidiaries with respect to the Anti-Money Laundering Laws is pending or, to
\nthe best knowledge of the Company, threatened.<\/p>\n<\/p>\n

(w) (i) The Company represents that neither the Company nor any of its
\nsubsidiaries, nor any director, officer or to the Company153s knowledge, any
\nemployee, agent, affiliate or representative of the Company or any of its
\nsubsidiaries, is an individual or entity (“Person<\/strong>“) that is, or
\nis owned or controlled by a Person that is:<\/p>\n<\/p>\n

(A) the subject of any sanctions administered or enforced by the U.S.
\nDepartment of Treasury153s Office of Foreign Assets Control
\n(“OFAC<\/strong>“) (the, “Sanctions<\/strong>“), nor<\/p>\n<\/p>\n

7<\/p>\n

\n

\n

(B) located, organized or resident in a country or territory that is the
\nsubject of Sanctions (including, without limitation, Burma\/Myanmar, Cuba, Iran,
\nNorth Korea, Sudan and Syria).<\/p>\n<\/p>\n

(ii) The Company represents and covenants that it will not, directly or
\nindirectly, use the proceeds of the offering, or lend, contribute or otherwise
\nmake available such proceeds to any subsidiary, joint venture partner or other
\nPerson:<\/p>\n<\/p>\n

(A) to fund or facilitate any activities or business of or with any Person or
\nin any country or territory that, at the time of such funding or facilitation,
\nis the subject of Sanctions; or<\/p>\n<\/p>\n

(B) in any other manner that will result in a violation of Sanctions by any
\nPerson (including any Person participating in the offering, whether as
\nunderwriter, advisor, investor or otherwise).<\/p>\n<\/p>\n

(iii) The Company represents and covenants that for the past 5 years, it and
\nits subsidiaries have not knowingly engaged in, are not now knowingly engaged
\nin, and will not engage in, any dealings or transactions with any Person, or in
\nany country or territory, that at the time of the dealing or transaction is or
\nwas the subject of Sanctions.<\/p>\n<\/p>\n

(x) The Company and each of its subsidiaries have filed all federal, state,
\nlocal and foreign tax returns required to be filed through the date of this
\nAgreement or have requested extensions thereof (except where the failure to file
\nwould not, individually or in the aggregate, have a material adverse effect on
\nthe Company and its subsidiaries, taken as a whole) and have paid all taxes
\nrequired to be paid thereon (except for cases in which the failure to file or
\npay would not have a material adverse effect on the Company and its
\nsubsidiaries, taken as a whole, or, except as currently being contested in good
\nfaith and for which reserves required by GAAP have been created in the financial
\nstatements of the Company), and no tax deficiency has been determined adversely
\nto the Company or any of its subsidiaries which has had (nor does the Company
\nnor any of its subsidiaries have any notice or knowledge of any tax deficiency
\nwhich could reasonably be expected to be determined adversely to the Company or
\nits subsidiaries) and which could reasonably be expected to have) a material
\nadverse effect on the Company and its subsidiaries, taken as a whole.<\/p>\n<\/p>\n

(y) The Company and its subsidiaries have good and marketable title in fee
\nsimple to all real property and good and marketable title to all personal
\nproperty owned by them which is material to the business of the Company and its
\nsubsidiaries as described in the Time of<\/p>\n<\/p>\n

8<\/p>\n

\n

\n

Sale Memorandum, in each case free and clear of all liens, encumbrances and
\ndefects except such as are described in the Time of Sale Memorandum or such as
\ndo not materially affect the value of such property and do not interfere with
\nthe use made and proposed to be made of such property by the Company and its
\nsubsidiaries; and any real property and buildings held under lease by the
\nCompany and its subsidiaries are held by them under valid, subsisting and
\nenforceable leases with such exceptions as are not material and do not
\nmaterially interfere with the use made and proposed to be made of such property
\nand buildings by the Company and its subsidiaries, in each case except as
\ndescribed in the Time of Sale Memorandum.<\/p>\n<\/p>\n

(z) Except as disclosed in the Time of Sale Memorandum, the Company and its
\nsubsidiaries own or possess, or can acquire on reasonable terms, adequate rights
\nto trademarks, service marks, trade names, copyrights, know-how (including trade
\nsecrets and confidential information, systems or procedures) and issued material
\npatents (or pending material patent applications of which the Company or its
\nsubsidiaries has knowledge) (collectively, “Intellectual Property Rights”)
\nnecessary to conduct the business now operated by the Company and its
\nsubsidiaries, and except as disclosed in the Time of Sale Memorandum, neither
\nthe Company nor any of its subsidiaries has received any written notice of
\ninfringement of or conflict with asserted rights of others with respect to any
\nof the foregoing Intellectual Property Rights that, if determined adversely to
\nthe Company or any of its subsidiaries, singly or in the aggregate, would have a
\nmaterial adverse effect on the Company and its subsidiaries, taken as a whole.\n<\/p>\n<\/p>\n

(aa) No material labor dispute with the employees of the Company or any of
\nits subsidiaries exists, except as described in the Time of Sale Memorandum, or,
\nto the knowledge of the Company, is threatened; and the Company is not aware of
\nany existing or threatened labor disturbance by the employees of any of its
\nprincipal suppliers, manufacturers or contractors that could have a material
\nadverse effect on the Company and its subsidiaries, taken as a whole.<\/p>\n<\/p>\n

(bb) The Company and each of its subsidiaries are insured by insurers of
\nrecognized financial responsibility against such losses and risks and in such
\namounts as are prudent and customary in the businesses in which they are
\nengaged; neither the Company nor any of its subsidiaries has been refused any
\ninsurance coverage sought or applied for; and neither the Company nor any of its
\nsubsidiaries has any reason to believe that it will not be able to renew its
\nexisting insurance coverage as and when such coverage expires or to obtain
\nsimilar coverage from similar insurers as<\/p>\n<\/p>\n

9<\/p>\n

\n

\n

may be necessary to continue its business at a cost that would not have a
\nmaterial adverse effect on the Company and its subsidiaries, taken as a whole,
\nexcept as described in the Time of Sale Memorandum.<\/p>\n<\/p>\n

(cc) The Company and its subsidiaries possess all certificates,
\nauthorizations and permits issued by the appropriate federal, state or foreign
\nregulatory authorities necessary to conduct their respective businesses as
\ndescribed in the Time of Sale Memorandum, except where the failure to possess
\nthe same would not, singly or in the aggregate, have a material adverse effect
\non the Company and its subsidiaries, taken as a whole, and neither the Company
\nnor any of its subsidiaries has received any notice of proceedings relating to
\nthe revocation or modification of any such certificate, authorization or permit
\nwhich, singly or in the aggregate, would have a material adverse effect on the
\nCompany and its subsidiaries, taken as a whole, except as described in the Time
\nof Sale Memorandum.<\/p>\n<\/p>\n

(dd) The Company and each of its subsidiaries maintain a system of “internal
\ncontrol over financial reporting” (as defined in Rule 13a-15 of the Exchange
\nAct)sufficient to provide reasonable assurance that (i) transactions are
\nexecuted in accordance with management153s general or specific authorizations;
\n(ii) transactions are recorded as necessary to permit preparation of financial
\nstatements in conformity with generally accepted accounting principles and to
\nmaintain asset accountability; (iii) access to assets is permitted only in
\naccordance with management153s general or specific authorization; and (iv) the
\nrecorded accountability for assets is compared with the existing assets at
\nreasonable intervals and appropriate action is taken with respect to any
\ndifferences. Except as described in the Time of Sale Memorandum, since the end
\nof the Company153s most recent audited fiscal year, there has been (i) no material
\nweakness in the Company153s internal control over financial reporting (whether or
\nnot remediated) and (ii) no change in the Company153s internal control over
\nfinancial reporting that has materially affected, or is reasonably likely to
\nmaterially affect, the Company153s internal control over financial reporting.<\/p>\n<\/p>\n

(ee) The Company has not taken and will not take, directly or indirectly, any
\naction designed to or that might be reasonably expected to (i) cause or result
\nin stabilization or manipulation of the price of the Securities or the
\nUnderlying Securities to facilitate the sale or resale of the Securities
\n(provided, however, that this paragraph shall not apply to any stabilization
\nactivities conducted by the Initial Purchasers, who shall remain solely
\nresponsible for such activities), or (ii) violate Regulation M under the
\nExchange Act.<\/p>\n<\/p>\n

10<\/p>\n

\n

\n

It is acknowledged by the parties that the Company is contemplating
\nrepurchasing shares of its Common Stock as further described in the Time of Sale
\nMemorandum.<\/p>\n<\/p>\n

2. Agreements to Sell and Purchase<\/em>. The Company hereby agrees to
\nsell to the several Initial Purchasers, and each Initial Purchaser, upon the
\nbasis of the representations and warranties herein contained, but subject to the
\nconditions hereinafter stated, agrees, severally and not jointly, to purchase
\nfrom the Company the respective principal amount of the Firm Securities set
\nforth in Schedule I hereto opposite its name at a purchase price of 97.25% of
\nthe principal amount thereof (the “Purchase Price<\/strong>“)plus accrued
\ninterest, if any, to the Closing Date.<\/p>\n<\/p>\n

On the basis of the representations and warranties contained in this
\nAgreement, and subject to its terms and conditions, the Company agrees to sell
\nto the Initial Purchasers the Additional Securities, and the Initial Purchasers
\nshall have the right to purchase, severally and not jointly, up to $45,000,000
\nprincipal amount of Additional Securities at the Purchase Price, plus accrued
\ninterest, if any, to the date of payment and delivery. You may exercise this
\nright on behalf of the Initial Purchasers in whole or from time to time in part
\nby giving written notice not later than 30 days after the date of this
\nAgreement. Any exercise notice shall specify the principal amount of Additional
\nSecurities to be purchased by the Initial Purchasers and the date on which such
\nAdditional Securities are to be purchased. Each purchase date must be at least
\none business day after the written notice is given and may not be earlier than
\nthe closing date for the Firm Securities nor later than ten business days after
\nthe date of such notice. Additional Securities may be purchased as provided in
\nSection 4 solely for the purpose of covering over-allotments made in connection
\nwith the offering of the Firm Securities. On each day, if any, that Additional
\nSecurities are to be purchased (an “Option Closing Date<\/strong>“), each
\nInitial Purchaser agrees, severally and not jointly, to purchase the principal
\namount of Additional Securities (subject to such adjustments to eliminate
\nfractional Securities as you may determine) that bears the same proportion to
\nthe total principal amount of Additional Securities to be purchased on such
\nOption Closing Date as the principal amount of Firm Securities set forth in
\nSchedule I opposite the name of such Initial Purchaser bears to the total
\nprincipal amount of Firm Securities.<\/p>\n<\/p>\n

3. Terms of Offering<\/em>. You have advised the Company that the Initial
\nPurchasers will make an offering of the Securities purchased by the Initial
\nPurchasers hereunder as soon as practicable after this Agreement is entered into
\nas in your judgment is advisable.<\/p>\n<\/p>\n

4. Payment and Delivery. <\/em>Payment for the Firm Securities shall be
\nmade to the Company in Federal or other funds immediately available in New<\/p>\n<\/p>\n

11<\/p>\n

\n

\n

York City against delivery of such Firm Securities for the respective
\naccounts of the several Initial Purchasers at 10:00 a.m., New York City time, on
\nNovember 1, 2010, or at such other time on the same or such other date, in any
\nevent not later than November 2, 2010, as shall be designated in writing by you.
\nThe time and date of such payment are hereinafter referred to as the
\n“Closing Date<\/strong>.”<\/p>\n<\/p>\n

Payment for any Additional Securities shall be made to the Company in Federal
\nor other funds immediately available in New York City against delivery of such
\nAdditional Securities for the respective accounts of the several Initial
\nPurchasers at 10:00 a.m., New York City time, on the date specified in the
\ncorresponding notice described in Section 2 or at such other time on the same or
\non such other date, in any event not later than December 9, 2010, as shall be
\ndesignated in writing by you.<\/p>\n<\/p>\n

The Securities shall be in definitive form or global form, as specified by
\nyou, and registered in such names and in such denominations as you shall request
\nin writing not later than one full business day prior to the Closing Date or the
\napplicable Option Closing Date, as the case may be. The Securities shall be
\ndelivered to you on the Closing Date or an Option Closing Date, as the case may
\nbe, for the respective accounts of the several Initial Purchasers, with any
\ntransfer taxes payable in connection with the transfer of the Securities to the
\nInitial Purchasers duly paid, against payment of the Purchase Price therefor
\nplus accrued interest, if any, to the date of payment and delivery.<\/p>\n<\/p>\n

5. Conditions to the Initial Purchasers153 Obligations. <\/em>The several
\nobligations of the Initial Purchasers to purchase and pay for the Firm
\nSecurities on the Closing Date are subject to the following conditions:<\/p>\n<\/p>\n

(a) Subsequent to the execution and delivery of this Agreement and prior to
\nthe Closing Date:<\/p>\n<\/p>\n

(i) there shall not have occurred any downgrading, nor shall any notice have
\nbeen given of any intended or potential downgrading or of any review for a
\npossible change that does not indicate the direction of the possible change, in
\nthe rating accorded the Company or any of the securities of the Company or any
\nof its subsidiaries or in the rating outlook for the Company by any “nationally
\nrecognized statistical rating organization,” as such term is defined in Rule
\n15c3-1(c)(2)(vi)(F) of the Exchange Act; and<\/p>\n<\/p>\n

(ii) there shall not have occurred any change, or any development reasonably
\nexpected to have a prospective change, in the condition, financial or otherwise,
\nor in the earnings, business or operations of the Company and its subsidiaries,
\ntaken as a<\/p>\n<\/p>\n

12<\/p>\n

\n

\n

whole, from that set forth in the Time of Sale Memorandum as of the date of
\nthis Agreement provided to the prospective purchasers of the Securities that, in
\nyour judgment, is material and adverse and that makes it, in your judgment,
\nimpracticable to market the Securities on the terms and in the manner
\ncontemplated in the Time of Sale Memorandum.<\/p>\n<\/p>\n

(b) The Representatives shall have received on the Closing Date a
\ncertificate, dated the Closing Date and signed by an executive officer of the
\nCompany, to the effect set forth in Section 5(a)(i) and to the effect that the
\nrepresentations and warranties of the Company contained in this Agreement are
\ntrue and correct as of the Closing Date and that the Company has complied with
\nall of the agreements and satisfied all of the conditions on its part to be
\nperformed or satisfied hereunder on or before the Closing Date.<\/p>\n<\/p>\n

The officer signing and delivering such certificate may rely upon the best of
\nhis or her knowledge as to proceedings threatened.<\/p>\n<\/p>\n

(c) The Representatives shall have received on the Closing Date an opinion of
\nHoward Rice Nemerovski Canady Falk & Rabkin, A Professional Corporation,
\noutside special counsel for the Company, dated the Closing Date, to the effect
\nset forth in Exhibit A. Such opinion shall be rendered to the Representatives at
\nthe request of the Company and shall so state therein.<\/p>\n<\/p>\n

(d) The Representatives shall have received on the Closing Date an opinion of
\nKevin Crudden, Vice President and General Counsel of the Company, dated the
\nClosing Date, to the effect set forth in Exhibit B. Such opinion shall be
\nrendered to the Representatives at the request of the Company and shall so state
\ntherein.<\/p>\n<\/p>\n

(e) The Representatives shall have received on the Closing Date an opinion of
\nDavis Polk & Wardwell LLP, counsel for the Initial Purchasers, dated the
\nClosing Date, to the effect set forth in Exhibit C.<\/p>\n<\/p>\n

(f) The Representatives shall have received on each of the date hereof and
\nthe Closing Date a letter, dated the date hereof or the Closing Date, as the
\ncase may be, in form and substance satisfactory to the Representatives, from
\nErnst & Young LLP, independent public accountants, containing statements and
\ninformation of the type ordinarily included in accountants153 “comfort letters” to
\nunderwriters with respect to the financial statements and certain financial
\ninformation contained in or incorporated by reference into the Time of Sale
\nMemorandum and the<\/p>\n<\/p>\n

13<\/p>\n

\n

\n

Final Memorandum; provided <\/em>that the letter delivered on the Closing
\nDate shall use a “cut-off date” not earlier than the date hereof.<\/p>\n<\/p>\n

(g) The “lock-up” agreements, each substantially in the form of Exhibit D
\nhereto, between you and the officers and directors of the Company relating to
\nsales and certain other dispositions of shares of common stock or certain other
\nsecurities, delivered to you on or before the date hereof, shall be in full
\nforce and effect on the Closing Date.<\/p>\n<\/p>\n

(h) At the time of execution of this Agreement, the Representatives shall
\nhave received a certificate of Thomas M. Donnelly, Chief Financial Officer of
\nthe Company in form and substance satisfactory to the Representatives.<\/p>\n<\/p>\n

(i) At the Closing Time, the Representatives shall have received a
\ncertificate of Thomas M. Donnelly, Chief Financial Officer of the Company in
\nform and substance satisfactory to the Representatives reaffirming the
\nstatements made in the letter furnished pursuant to subsection (h) of this
\nSection as of the date hereof.<\/p>\n<\/p>\n

(j) A notification for the listing of the Underlying Securities shall have
\nbeen submitted to NASDAQ.<\/p>\n<\/p>\n

The several obligations of the Initial Purchasers to purchase Additional
\nSecurities hereunder are subject to the delivery to you on the applicable Option
\nClosing Date of such documents as you may reasonably request with respect to the
\ngood standing of the Company, the due authorization, execution and
\nauthentication of the Additional Securities to be sold on such Option Closing
\nDate and other matters related to the execution and authentication of such
\nAdditional Securities.<\/p>\n<\/p>\n

6. Covenants of the Company<\/em>. The Company covenants with each Initial
\nPurchaser as follows:<\/p>\n<\/p>\n

(a) To furnish to you in New York City, without charge, prior to 10:00 a.m.
\nNew York City time on the second business day succeeding the date of this
\nAgreement and during the period mentioned in Section 6(d) or (e), as many copies
\nof the Time of Sale Memorandum, the Final Memorandum, any documents incorporated
\nby reference therein and any supplements and amendments thereto as you may
\nreasonably request.<\/p>\n<\/p>\n

(b) Before amending or supplementing the Preliminary Memorandum, the Time of
\nSale Memorandum or the Final Memorandum, to furnish to you a copy of each such
\nproposed amendment or supplement<\/p>\n<\/p>\n

14<\/p>\n

\n

\n

and not to use any such proposed amendment or supplement to which you
\nreasonably object.<\/p>\n<\/p>\n

(c) To furnish to you a copy of each proposed Additional Written Offering
\nCommunication to be prepared by or on behalf of, used by, or referred to by the
\nCompany and not to use or refer to any proposed Additional Written Offering
\nCommunication to which you reasonably object.<\/p>\n<\/p>\n

(d) If the Time of Sale Memorandum is being used to solicit offers to buy the
\nSecurities at a time when the Final Memorandum is not yet available to
\nprospective purchasers and any event shall occur or condition exist as a result
\nof which it is necessary to amend or supplement the Time of Sale Memorandum in
\norder to make the statements therein, in the light of the circumstances, not
\nmisleading, or if, in the opinion of counsel for the Initial Purchasers, it is
\nnecessary to amend or supplement the Time of Sale Memorandum to comply with
\napplicable law, forthwith to prepare and furnish, at its own expense, to the
\nInitial Purchasers and to any dealer upon request, either amendments or
\nsupplements to the Time of Sale Memorandum so that the statements in the Time of
\nSale Memorandum as so amended or supplemented will not, in the light of the
\ncircumstances when delivered to a prospective purchaser, be misleading or so
\nthat the Time of Sale Memorandum, as amended or supplemented, will comply with
\napplicable law.<\/p>\n<\/p>\n

(e) If, during such period after the date hereof and prior to the date on
\nwhich all of the Securities shall have been sold by the Initial Purchasers, any
\nevent shall occur or condition exist as a result of which it is necessary to
\namend or supplement the Final Memorandum in order to make the statements
\ntherein, in the light of the circumstances when the Final Memorandum is
\ndelivered to a purchaser, not misleading, or if, in the opinion of counsel for
\nthe Initial Purchasers, it is necessary to amend or supplement the Final
\nMemorandum to comply with applicable law, forthwith to prepare and furnish to
\nthe Initial Purchasers, at the Company153s expense for a period of six months
\nfollowing the Closing Date and at the Initial Purchasers153 expense thereafter,
\neither amendments or supplements to the Final Memorandum so that the statements
\nin the Final Memorandum as so amended or supplemented will not, in the light of
\nthe circumstances when the Final Memorandum is delivered to a purchaser, be
\nmisleading or so that the Final Memorandum, as amended or supplemented, will
\ncomply with applicable law.<\/p>\n<\/p>\n

(f) To endeavor to qualify the Securities for offer and sale under the
\nsecurities or Blue Sky laws of such jurisdictions in the United<\/p>\n<\/p>\n

15<\/p>\n

\n

\n

States and Canada as you shall reasonably request, provided that the Company
\nwill not be required to qualify as a foreign corporation or to file a general
\nconsent of service of process in any jurisdiction in which it is not otherwise
\nso qualified or subject.<\/p>\n<\/p>\n

(g) Whether or not the transactions contemplated in this Agreement are
\nconsummated or this Agreement is terminated, to pay or cause to be paid all
\nexpenses incident to the performance of the Company153s obligations under this
\nAgreement, including: (i) the fees, disbursements and expenses of the Company153s
\ncounsel and the Company153s accountants in connection with the issuance and sale
\nof the Securities and all other fees or expenses in connection with the
\npreparation of the Preliminary Memorandum, the Time of Sale Memorandum, the
\nFinal Memorandum, any Additional Written Offering Communication prepared by or
\non behalf of, used by, or referred to by the Company and any amendments and
\nsupplements to any of the foregoing, including all printing costs associated
\ntherewith, and the delivering of copies thereof to the Initial Purchasers, in
\nthe quantities herein above specified, (ii) all costs and expenses related to
\nthe transfer and delivery of the Securities to the Initial Purchasers, including
\nany transfer or other taxes payable thereon, (iii) the cost of printing or
\nproducing any Blue Sky or legal investment memorandum in connection with the
\noffer and sale of the Securities under state securities laws and all expenses in
\nconnection with the qualification of the Securities for offer and sale under
\nstate securities laws as provided in Section 6(f) hereof, including filing fees
\nand the reasonable fees and disbursements of counsel for the Initial Purchasers
\nin connection with such qualification and in connection with the Blue Sky or
\nlegal investment memorandum, (iv) any fees charged by rating agencies for the
\nrating of the Securities, (v) the fees and expenses, if any, incurred in
\nconnection with the admission of the Securities for trading on any appropriate
\nmarket system, (vi) the costs and charges of the Trustee and any transfer agent,
\nregistrar or depositary, (vii) the cost of the preparation, issuance and
\ndelivery of the Securities, (viii) the costs and expenses of the Company
\nrelating to investor presentations on any “road show” undertaken in connection
\nwith the marketing of the offering of the Securities, including, without
\nlimitation, expenses associated with the preparation or dissemination of any
\nelectronic road show, expenses associated with production of road show slides
\nand graphics, fees and expenses of any consultants engaged in connection with
\nthe road show presentations with the prior approval of the Company, travel and
\nlodging expenses of the representatives and officers of the Company and any such
\nconsultants, and the cost of any aircraft chartered in connection with the road
\nshow, (ix) the document production charges and expenses associated with printing
\nthis Agreement and (x) all other cost and expenses incident to the performance\n<\/p>\n<\/p>\n

16<\/p>\n

\n

\n

of the obligations of the Company hereunder for which provision is not
\notherwise made in this Section. It is understood, however, that except as
\nprovided in this Section, Section 8, and the last paragraph of Section 10, the
\nInitial Purchasers will pay all of their costs and expenses, including fees and
\ndisbursements of their counsel, transfer taxes payable on resale of any of the
\nSecurities by them and any advertising expenses connected with any offers they
\nmay make.<\/p>\n<\/p>\n

(h) Neither the Company nor its Affiliate will sell, offer for sale or
\nsolicit offers to buy or otherwise negotiate in respect of any security (as
\ndefined in the Securities Act) which could be integrated with the sale of the
\nSecurities in a manner which would require the registration under the Securities
\nAct of the Securities.<\/p>\n<\/p>\n

(i) Not to solicit any offer to buy or offer or sell the Securities or the
\nUnderlying Securities by means of any form of general solicitation or general
\nadvertising (as those terms are used in Regulation D under the Securities Act)
\nor in any manner involving a public offering within the meaning of Section 4(2)
\nof the Securities Act.<\/p>\n<\/p>\n

(j) While any of the Securities or the Underlying Securities remain
\n“restricted securities” within the meaning of the Securities Act, to make
\navailable, upon request, to any seller of such Securities the information
\nspecified in Rule 144A(d)(4) under the Securities Act, unless the Company is
\nthen subject to Section 13 or 15(d) of the Exchange Act.<\/p>\n<\/p>\n

(k) During the period of two years after the Closing Date or any Option
\nClosing Date, if later, the Company will not be, nor will it become, an open-end
\ninvestment company, unit investment trust or face-amount certificate company
\nthat is or is required to be registered under Section 8 of the Investment
\nCompany Act.<\/p>\n<\/p>\n

(l) None of the Company, its Affiliates or any person acting on its or their
\nbehalf (other than the Initial Purchasers) will engage in any directed selling
\nefforts (as that term is defined in Regulation S) with respect to the
\nSecurities, and the Company and its Affiliates and each person acting on its or
\ntheir behalf (other than the Initial Purchasers) will comply with the offering
\nrestrictions requirement of Regulation S.<\/p>\n<\/p>\n

(m) During the period of six months after the Closing Date or any Option
\nClosing Date, if later, the Company will not, and will not permit any of its
\naffiliates (as defined in Rule 144 under the Securities Act) to resell any of
\nthe Securities or the Underlying Securities which constitute “restricted
\nsecurities” under Rule 144 that have been reacquired by any of them.<\/p>\n<\/p>\n

17<\/p>\n

\n

\n

(n) Not to take any action prohibited by Regulation M under the Exchange Act
\nin connection with the distribution of the Securities contemplated hereby.<\/p>\n<\/p>\n

(o) The Company will reserve and keep available at all times, free of
\npre-emptive rights, shares of common stock for the purpose of enabling the
\nCompany to satisfy all obligations to issue the Underlying Securities upon
\nconversion of the Securities. The Company will use its reasonable efforts to
\ncause the Underlying Securities to be listed on NASDAQ.<\/p>\n<\/p>\n

The Company also agrees that, without the prior written consent of
\nRepresentatives on behalf of the Initial Purchasers, it will not, during the
\nperiod ending 90 days after the date of the Final Memorandum, (1) offer, pledge,
\nsell, contract to sell, sell any option or contract to purchase, purchase any
\noption or contract to sell, grant any option, right or warrant to purchase,
\nlend, or otherwise transfer or dispose of, directly or indirectly, any shares of
\ncommon stock or any securities convertible into or exercisable or exchangeable
\nfor common stock or (2) enter into any swap or other arrangement that transfers
\nto another, in whole or in part, any of the economic consequences of ownership
\nof the common stock, whether any such transaction described in clause (1) or (2)
\nabove is to be settled by delivery of common stock or such other securities, in
\ncash or otherwise. The foregoing sentence shall not apply to (a) the sale of the
\nSecurities under this Agreement, (b) grants of options, restricted stock, stock
\nappreciation rights, performance shares, restricted stock units or other rights
\nto purchase shares of common stock pursuant to the terms of an equity incentive
\nplan or stock purchase plan of the Company in effect on the date hereof and the
\nissuances by the Company of any shares of common stock pursuant to the exercise
\nof such options or rights, (c) the issuance by the Company of any shares of
\ncommon stock upon the exercise of an option or warrant or the conversion of a
\nsecurity outstanding on the date hereof, (d) the issuance by the Company of any
\nshares of common stock pursuant to its obligations with respect to the employer
\nstock funds included in the Company153s 401(k) Plan existing as of the date
\nhereof, or (e) the establishment of a trading plan pursuant to Rule 10b5-1 under
\nthe Exchange Act for the transfer of shares of common stock, provided that such
\nplan does not provide for the transfer of common stock during the 90-day
\nrestricted period and no public announcement or filing under the Exchange Act
\nregarding the establishment of such plan shall be required of or voluntarily
\nmade by or on behalf of the Company.<\/p>\n<\/p>\n

7. Offering of Securities; Restrictions on Transfer<\/em>. (a) Each
\nInitial Purchaser, severally and not jointly, represents and warrants that such
\nInitial Purchaser is a qualified institutional buyer as defined in Rule 144A
\nunder the Securities Act (a “QIB<\/strong>“). Each Initial Purchaser,
\nseverally and not jointly, agrees<\/p>\n<\/p>\n

18<\/p>\n

\n

\n

with the Company that (i) it will not solicit offers for, or offer or sell,
\nsuch Securities by any form of general solicitation or general advertising (as
\nthose terms are used in Regulation D under the Securities Act) or in any manner
\ninvolving a public offering within the meaning of Section 4(2) of the Securities
\nAct and (ii) it will solicit offers for such Securities only from, and will
\noffer such Securities only to, persons that it reasonably believes to be QIBs
\nthat in purchasing such Securities are deemed to have represented and agreed as
\nprovided in the Final Memorandum under the caption “Notice to Investors”.<\/p>\n<\/p>\n

(b) The Company agrees that the Initial Purchasers may provide copies of the
\nPreliminary Memorandum, the Time of Sale Memorandum, the Final Memorandum and
\nany other agreements or documents relating thereto, including without
\nlimitation, the Indenture to Xtract Research LLC (“Xtract”), following
\ncompletion of the offering, for inclusion in an online research service
\nsponsored by Xtract, access to which shall be restricted by Xtract to QIBs.<\/p>\n<\/p>\n

8. Indemnity and Contribution<\/em>. (a) The Company agrees to indemnify
\nand hold harmless each Initial Purchaser, each person, if any, who controls any
\nInitial Purchaser within the meaning of either Section 15 of the Securities Act
\nor Section 20 of the Exchange Act, and each affiliate of any Initial Purchaser
\nwithin the meaning of Rule 405 under the Securities Act from and against any and
\nall losses, claims, damages and liabilities (including, without limitation, any
\nlegal or other expenses reasonably incurred in connection with defending or
\ninvestigating any such action or claim) caused by any untrue statement or
\nalleged untrue statement of a material fact contained in the Preliminary
\nMemorandum, the Time of Sale Memorandum, any Additional Written Offering
\nCommunication prepared by or on behalf of, used by, or referred to by the
\nCompany, or the Final Memorandum or any amendment or supplement thereto, or
\ncaused by any omission or alleged omission to state therein a material fact
\nnecessary to make the statements therein in the light of the circumstances under
\nwhich they were made not misleading, except insofar as such losses, claims,
\ndamages or liabilities are caused by any such untrue statement or omission or
\nalleged untrue statement or omission based upon information relating to any
\nInitial Purchaser furnished to the Company in writing by such Initial Purchaser
\nthrough you expressly for use therein.<\/p>\n<\/p>\n

(b) Each Initial Purchaser agrees, severally and not jointly, to indemnify
\nand hold harmless the Company, its directors, its officers and each person, if
\nany, who controls the Company within the meaning of either Section 15 of the
\nSecurities Act or Section 20 of the Exchange Act to the same extent as the
\nforegoing indemnity from the Company to such Initial Purchaser, but only with
\nreference to information relating to such Initial Purchaser furnished to the
\nCompany in writing by such Initial Purchaser through you expressly for use in
\nthe<\/p>\n<\/p>\n

19<\/p>\n

\n

\n

Preliminary Memorandum, the Time of Sale Memorandum, any Additional Written
\nOffering Communication prepared by or on behalf of, used by or referred to by
\nthe Company, or the Final Memorandum or any amendment or supplement thereto.\n<\/p>\n<\/p>\n

(c) In case any proceeding (including any governmental investigation) shall
\nbe instituted involving any person in respect of which indemnity may be sought
\npursuant to Section 8(a) or 8(b), such person (the “indemnified
\nparty<\/strong>“) shall promptly notify the person against whom such indemnity
\nmay be sought (the “indemnifying party<\/strong>“) in writing and the
\nindemnifying party, upon request of the indemnified party, shall retain counsel
\nreasonably satisfactory to the indemnified party to represent the indemnified
\nparty and shall pay the reasonable fees and disbursements of such counsel
\nrelated to such proceeding. In any such proceeding, any indemnified party shall
\nhave the right to retain its own counsel, but the fees and expenses of such
\ncounsel shall be at the expense of such indemnified party unless (i) the
\nindemnifying party and the indemnified party shall have mutually agreed to the
\nretention of such counsel or (ii) the named parties to any such proceeding
\n(including any impleaded parties) include both the indemnifying party and the
\nindemnified party and representation of both parties by the same counsel would
\nbe inappropriate due to actual or potential conflicts of interests between them.
\nIt is understood that the indemnifying party shall not, in respect of the legal
\nexpenses of any indemnified party in connection with any proceeding or related
\nproceedings in the same jurisdiction, be liable for the fees and expenses of
\nmore than one separate firm (in addition to any local counsel) for all such
\nindemnified parties and that all such fees and expenses shall be reimbursed as
\nthey are incurred. Such firm shall be designated in writing by the
\nRepresentatives, in the case of parties indemnified pursuant to Section 8(a),
\nand by the Company, in the case of parties indemnified pursuant to Section 8(b).
\nThe indemnifying party shall not be liable for any settlement of any proceeding
\neffected without its written consent, but if settled with such consent or if
\nthere be a final judgment for the plaintiff, the indemnifying party agrees to
\nindemnify the indemnified party from and against any loss or liability by reason
\nof such settlement or judgment. Notwithstanding the foregoing sentence, if at
\nany time an indemnified party shall have requested an indemnifying party to
\nreimburse the indemnified party for fees and expenses of counsel as contemplated
\nby the second and third sentences of this paragraph, the indemnifying party
\nagrees that it shall be liable for any settlement of any proceeding effected
\nwithout its written consent if (i) such settlement is entered into more than 60
\ndays after receipt by such indemnifying party of the aforesaid request and (ii)
\nsuch indemnifying party shall not have reimbursed the indemnified party in
\naccordance with such request prior to the date of such settlement. No
\nindemnifying party shall, without the prior written consent of the indemnified
\nparty, effect any settlement of any pending or threatened proceeding in respect
\nof which any indemnified party is or could have been a party and<\/p>\n<\/p>\n

20<\/p>\n

\n

\n

indemnity could have been sought hereunder by such indemnified party, unless
\nsuch settlement includes an unconditional release of such indemnified party from
\nall liability on claims that are the subject matter of such proceeding and does
\nnot include a statement as to or an admission of fault, culpability or a failure
\nto act by or on behalf of any indemnified party.<\/p>\n<\/p>\n

(d) To the extent the indemnification provided for in Section 8(a) or 8(b) is
\nunavailable to an indemnified party or insufficient in respect of any losses,
\nclaims, damages or liabilities referred to therein, then each indemnifying party
\nunder such paragraph, in lieu of indemnifying such indemnified party thereunder,
\nshall contribute to the amount paid or payable by such indemnified party as a
\nresult of such losses, claims, damages or liabilities (i) in such proportion as
\nis appropriate to reflect the relative benefits received by the Company on the
\none hand and the Initial Purchasers on the other hand from the offering of the
\nSecurities or (ii) if the allocation provided by clause 8(d)(i) above is not
\npermitted by applicable law, in such proportion as is appropriate to reflect not
\nonly the relative benefits referred to in clause 8(d)(i) above but also the
\nrelative fault of the Company on the one hand and of the Initial Purchasers on
\nthe other hand in connection with the statements or omissions that resulted in
\nsuch losses, claims, damages or liabilities, as well as any other relevant
\nequitable considerations. The relative benefits received by the Company on the
\none hand and the Initial Purchasers on the other hand in connection with the
\noffering of the Securities shall be deemed to be in the same respective
\nproportions as the net proceeds from the offering of the Securities (before
\ndeducting expenses) received by the Company and the total discounts and
\ncommissions received by the Initial Purchasers bear to the aggregate offering
\nprice of the Securities. The relative fault of the Company on the one hand and
\nof the Initial Purchasers on the other hand shall be determined by reference to,
\namong other things, whether the untrue or alleged untrue statement of a material
\nfact or the omission or alleged omission to state a material fact relates to
\ninformation supplied by the Company or by the Initial Purchasers and the
\nparties153 relative intent, knowledge, access to information and opportunity to
\ncorrect or prevent such statement or omission. The Initial Purchasers153
\nrespective obligations to contribute pursuant to this Section 8 are several in
\nproportion to the respective principal amount of Securities they have purchased
\nhereunder, and not joint.<\/p>\n<\/p>\n

(e) The Company and the Initial Purchasers agree that it would not be just or
\nequitable if contribution pursuant to this Section 8 were determined by pro
\nrata <\/em>allocation (even if the Initial Purchasers were treated as one entity
\nfor such purpose) or by any other method of allocation that does not take
\naccount of the equitable considerations referred to in Section 8(d). The amount
\npaid or payable by an indemnified party as a result of the losses, claims,
\ndamages and liabilities referred to in Section 8(d) shall be deemed to include,
\nsubject to the limitations set forth above, any legal or other expenses
\nreasonably incurred by<\/p>\n<\/p>\n

21<\/p>\n

\n

\n

such indemnified party in connection with investigating or defending any such
\naction or claim. Notwithstanding the provisions of this Section 8, no Initial
\nPurchaser shall be required to contribute any amount in excess of the purchase
\ndiscount or commissions received by such Initial Purchasers in connection with
\nthe Securities purchased by it and distributed to the public. No person guilty
\nof fraudulent misrepresentation (within the meaning of Section 11(f) of the
\nSecurities Act) shall be entitled to contribution from any person who was not
\nguilty of such fraudulent misrepresentation. The remedies provided for in this
\nSection 8 are not exclusive and shall not limit any rights or remedies which may
\notherwise be available to any indemnified party at law or in equity.<\/p>\n<\/p>\n

(f) The indemnity and contribution provisions contained in this Section 8 and
\nthe representations, warranties and other statements of the Company contained in
\nthis Agreement shall remain operative and in full force and effect regardless of
\n(i) any termination of this Agreement, (ii) any investigation made by or on
\nbehalf of any Initial Purchaser, any person controlling any Initial Purchaser or
\nany affiliate of any Initial Purchaser or by or on behalf of the Company, its
\nofficers or directors or any person controlling the Company and (iii) acceptance
\nof and payment for any of the Securities.<\/p>\n<\/p>\n

9. Termination<\/em>. The Initial Purchasers may terminate this Agreement
\nby notice given by you to the Company, if after the execution and delivery of
\nthis Agreement and prior to the Closing Date (i) trading generally shall have
\nbeen suspended or materially limited on, or by, as the case may be, any of the
\nNew York Stock Exchange, the American Stock Exchange, the NASDAQ Global Market,
\nthe Chicago Board of Options Exchange, the Chicago Mercantile Exchange or the
\nChicago Board of Trade, (ii) trading of any securities of the Company shall have
\nbeen suspended on any exchange or in any over-the-counter market, (iii) a
\nmaterial disruption in securities settlement, payment or clearance services in
\nthe United States shall have occurred, (iv) any moratorium on commercial banking
\nactivities shall have been declared by Federal or New York State authorities or
\n(v) there shall have occurred any outbreak or escalation of hostilities, or any
\nchange in financial markets or any calamity or crisis that, in your judgment, is
\nmaterial and adverse such that it, singly or together with any other event
\nspecified in this clause (v), makes it, in your judgment, impracticable or
\ninadvisable to proceed with the offer, sale or delivery of the Securities on the
\nterms and in the manner contemplated in the Time of Sale Memorandum or the Final
\nMemorandum.<\/p>\n<\/p>\n

10. Effectiveness; Defaulting Initial Purchasers<\/em>. This Agreement
\nshall become effective upon the execution and delivery hereof by the parties
\nhereto.<\/p>\n<\/p>\n

If, on the Closing Date, or an Option Closing Date, as the case may be, any
\none or more of the Initial Purchasers shall fail or refuse to purchase
\nSecurities<\/p>\n<\/p>\n

22<\/p>\n

\n

\n

that it or they have agreed to purchase hereunder on such date, and the
\naggregate principal amount of Securities which such defaulting Initial Purchaser
\nor Initial Purchasers agreed but failed or refused to purchase is not more than
\none-tenth of the aggregate principal amount of Securities to be purchased on
\nsuch date, the other Initial Purchasers shall be obligated severally in the
\nproportions that the principal amount of Firm Securities set forth opposite
\ntheir respective names in Schedule I bears to the aggregate principal amount of
\nFirm Securities set forth opposite the names of all such non-defaulting Initial
\nPurchasers, or in such other proportions as you may specify, to purchase the
\nSecurities which such defaulting Initial Purchaser or Initial Purchasers agreed
\nbut failed or refused to purchase on such date; provided<\/em> that in no
\nevent shall the principal amount of Securities that any Initial Purchaser has
\nagreed to purchase pursuant to this Agreement be increased pursuant to this
\nSection 10 by an amount in excess of one-ninth of such principal amount of
\nSecurities without the written consent of such Initial Purchaser. If, on the
\nClosing Date any Initial Purchaser or Initial Purchasers shall fail or refuse to
\npurchase Firm Securities which it or they have agreed to purchase hereunder on
\nsuch date and the aggregate principal amount of Securities with respect to which
\nsuch default occurs is more than one-tenth of the aggregate principal amount of
\nFirm Securities to be purchased on such date, and arrangements satisfactory to
\nyou and the Company for the purchase of such Firm Securities are not made within
\n36 hours after such default, this Agreement shall terminate without liability on
\nthe part of any non-defaulting Initial Purchaser or of the Company. In any such
\ncase either you or the Company shall have the right to postpone the Closing
\nDate, but in no event for longer than seven days, in order that the required
\nchanges, if any, in the Time of Sale Memorandum, the Final Memorandum or in any
\nother documents or arrangements may be effected. If, on an Option Closing Date,
\nany Initial Purchaser or Initial Purchasers shall fail or refuse to purchase
\nAdditional Securities and the aggregate principal amount of Additional
\nSecurities with respect to which such default occurs is more than one-tenth of
\nthe aggregate principal amount of Additional Securities to be purchased on such
\nOption Closing Date, the non-defaulting Initial Purchasers shall have the option
\nto (a) terminate their obligation hereunder to purchase the Additional
\nSecurities to be sold on such Option Closing Date or (b) purchase not less than
\nthe principal amount of Additional Securities that such non-defaulting Initial
\nPurchasers would have been obligated to purchase in the absence of such default.
\nAny action taken under this paragraph shall not relieve any defaulting Initial
\nPurchaser from liability in respect of any default of such Initial Purchaser
\nunder this Agreement.<\/p>\n<\/p>\n

If this Agreement shall be terminated by the Initial Purchasers, or any of
\nthem, because of any failure or refusal on the part of the Company to comply
\nwith the terms or to fulfill any of the conditions of this Agreement, or if for
\nany reason the Company shall be unable to perform its obligations under this
\nAgreement, the Company will reimburse the Initial Purchasers or such Initial
\nPurchasers as have<\/p>\n<\/p>\n

23<\/p>\n

\n

\n

so terminated this Agreement with respect to themselves, severally, for all
\nout-of-pocket expenses (including the fees and disbursements of their counsel)
\nreasonably incurred by such Initial Purchasers in connection with this Agreement
\nor the offering contemplated hereunder.<\/p>\n<\/p>\n

11. Entire Agreement<\/em>. (a) This Agreement represents the entire
\nagreement between the Company and the Initial Purchasers with respect to the
\npreparation of the Preliminary Memorandum, the Time of Sale Memorandum, the
\nFinal Memorandum, the conduct of the offering, and the purchase and sale of the
\nSecurities.<\/p>\n<\/p>\n

(b) The Company acknowledges that in connection with the offering of the
\nSecurities: (i) the Initial Purchasers have acted at arms length, are not agents
\nof, and owe no fiduciary duties to, the Company or any other person, (ii) the
\nInitial Purchasers owe the Company only those duties and obligations set forth
\nin this Agreement and prior written agreements (to the extent not superseded by
\nthis Agreement) if any, and (iii) the Initial Purchasers may have interests that
\ndiffer from those of the Company. The Company waives to the full extent
\npermitted by applicable law any claims it may have against the Initial
\nPurchasers arising from an alleged breach of fiduciary duty in connection with
\nthe offering of the Securities.<\/p>\n<\/p>\n

12. Counterparts. <\/em>This Agreement may be signed in two or more
\ncounterparts, each of which shall be an original, with the same effect as if the
\nsignatures thereto and hereto were upon the same instrument.<\/p>\n<\/p>\n

13. Applicable Law. <\/em>This Agreement shall be governed by and
\nconstrued in accordance with the internal laws of the State of New York.<\/p>\n<\/p>\n

14. Headings. <\/em>The headings of the sections of this Agreement have
\nbeen inserted for convenience of reference only and shall not be deemed a part
\nof this Agreement.<\/p>\n<\/p>\n

15. Notices. <\/em>All communications hereunder shall be in writing and
\neffective only upon receipt and if to the Initial Purchasers shall be delivered,
\nmailed or sent to Merrill Lynch, Pierce, Fenner & Smith Incorporated, 1
\nBryant Park, New York, New York 10036, Telecopy No.: 212-901-7881, Attention:
\nLegal and Morgan Stanley & Co. Incorporated, 1585 Broadway, New York, New
\nYork 10036, and if to the Company shall be delivered, mailed or sent by
\nfacsimile to 9625 W. 76th Street, Suite 150, Eden Prairie, MN 55344, Attention:
\nChief Financial Officer, Fax: (952) 253-1234.<\/p>\n<\/p>\n

24<\/p>\n

\n

\n\n\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Very truly yours,<\/p>\n

Digital River, Inc.<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
<\/td>\n\n

By:<\/p>\n<\/td>\n

\n

\/s\/ Thomas M. Donnelly<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n\n

Name:<\/p>\n<\/td>\n

\n

Thomas M. Donnelly<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n\n

Title:<\/p>\n<\/td>\n

\n

Chief Financial Officer<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

[Purchase Agreement]<\/p>\n

\n

\n

size=2 width=”100%” noshade style=’color:#A0A0A0′ align=center><\/p>\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Accepted as of the date hereof<\/p>\n

Merrill Lynch, Pierce, Fenner & Smith
\nIncorporated
\nMorgan Stanley & Co. Incorporated<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

Acting severally on behalf of themselves and the
\nseveral Initial Purchasers named in
\nSchedule I hereto.<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
\n

By:<\/p>\n<\/td>\n

\n

Merrill Lynch, Pierce, Fenner & Smith Incorporated<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/tr>\n
\n

By:<\/p>\n<\/td>\n

\n

\/s\/ Ric Spencer<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Name:<\/p>\n<\/td>\n

\n

Ric Spencer<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Title:<\/p>\n<\/td>\n

\n

MD<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

By:<\/p>\n<\/td>\n

\n

Morgan Stanley & Co. Incorporated<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/tr>\n
\n

By:<\/p>\n<\/td>\n

\n

\/s\/ Robert Brass<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Name:<\/p>\n<\/td>\n

\n

Robert Brass<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Title:<\/p>\n<\/td>\n

\n

Executive Director<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

[Purchase Agreement]<\/p>\n

\n

size=2 width=”100%” noshade style=’color:#A0A0A0′ align=center><\/p>\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

SCHEDULE I<\/strong><\/p>\n\n\n\n\n\n\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n\n

Principal Amount of<\/strong><\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n\n

Firm Securities to be<\/strong><\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
\n

Initial Purchaser<\/strong><\/p>\n<\/td>\n

<\/td>\n\n

Purchased<\/strong><\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
\n

Merrill Lynch, Pierce, Fenner & Smith Incorporated<\/p>\n<\/td>\n

<\/td>\n\n

$<\/p>\n<\/td>\n

\n

150,000,000<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
\n

Morgan Stanley & Co. Incorporated<\/p>\n<\/td>\n

<\/td>\n\n

$<\/p>\n<\/td>\n

\n

120,000,000<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
\n

Piper Jaffray & Co.<\/p>\n<\/td>\n

<\/td>\n\n

$<\/p>\n<\/td>\n

\n

30,000,000<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
\n

Total:<\/p>\n<\/td>\n

<\/td>\n\n

$<\/p>\n<\/td>\n

\n

300,000,000<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

I-1<\/p>\n

\n

\n

SCHEDULE II<\/strong><\/p>\n

\n

Significant Subsidiaries<\/strong><\/p>\n

\n

BlueHornet Networks, Inc.<\/p>\n<\/p>\n

Digital River GmbH<\/p>\n<\/p>\n

Digital River Technology Limited<\/p>\n<\/p>\n

Digital River Ireland Limited<\/p>\n<\/p>\n

II-1<\/p>\n

\n

\n

SCHEDULE III<\/strong><\/p>\n

\n

Time of Sale Memorandum<\/strong><\/p>\n

\n\n\n\n\n\n
\n

1.<\/p>\n<\/td>\n

<\/td>\n\n

Preliminary Memorandum issued October 25, 2010<\/p>\n<\/td>\n<\/tr>\n

<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

2.<\/p>\n<\/td>\n

<\/td>\n\n

Pricing Term Sheet dated October 26, 2010<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

III-1<\/p>\n

\n

\n\n\n\n
<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

EXHIBIT A<\/strong><\/p>\n

\n

OPINION OF HOWARD RICE NEMEROVSKI CANADY FALK &
\n
\nRABKIN, A PROFESSIONAL CORPORATION, OUTSIDE SPECIAL
\nCOUNSEL FOR THE COMPANY<\/strong><\/p>\n

\n

November ___, 2010<\/p>\n

\n

Merrill Lynch, Pierce, Fenner & Smith Incorporated
\nMorgan Stanley & Co. Incorporated<\/p>\n<\/p>\n

As Representatives of the Initial Purchasers<\/p>\n<\/p>\n

c\/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
\nOne Bryant Park
\nNew York, NY 10036<\/p>\n<\/p>\n

c\/o Morgan Stanley & Co. Incorporated
\n1585 Broadway
\nNew York, NY 10036<\/p>\n<\/p>\n

Re: <\/strong>Digital River, Inc.<\/p>\n<\/p>\n

Ladies and Gentlemen:<\/p>\n<\/p>\n

You have requested our opinion as special legal counsel to Digital River,
\nInc., a Delaware corporation (the “Company<\/em><\/strong>“), with
\nrespect to certain matters in connection with the offering of up to $300,000,000
\naggregate principal amount of 2.00% Convertible Senior Notes due 2030 to Merrill
\nLynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co.
\nIncorporated and Piper Jaffray & Co., as Representatives of the several
\nInitial Purchasers (the “Initial Purchasers<\/em><\/strong>“),
\npursuant to that certain Purchase Agreement, dated October 26, 2010, between the
\nCompany and the Initial Purchasers (the “Agreement<\/em><\/strong>“).
\nExcept as otherwise specified, all capitalized terms used herein have the same
\nmeanings given to them in the Agreement. We are rendering this opinion at the
\nrequest of the Company pursuant to Section 5(c) of the Agreement.<\/p>\n<\/p>\n

In this connection, we have examined original or copies of the following
\ndocuments, each of which is dated the date hereof (unless otherwise specified):\n<\/p>\n<\/p>\n

1. The Time of Sale Memorandum for the Firm Notes (as defined below) dated
\nOctober 26, 2010 (the “Time of Sale Memorandum<\/em><\/strong>“);<\/p>\n<\/p>\n

A-1<\/p>\n

\n

\n

2. The Final Memorandum for the Firm Notes dated October [26], 2010 (the
\n“Final Memorandum<\/em><\/strong>“);<\/p>\n<\/p>\n

3. The Agreement;<\/p>\n<\/p>\n

4. The Indenture dated as of November 1, 2010 between the Company and Wells
\nFargo Bank, National Association, as trustee (the
\n“Trustee<\/em><\/strong>“) (the
\n“Indenture<\/em><\/strong>“);<\/p>\n<\/p>\n

5. The 2.00% Convertible Senior Notes dated November 1, 2010, issued by the
\nCompany in favor of the Initial Purchasers pursuant to the Agreement as of the
\ndate hereof (the “Firm Notes<\/em><\/strong>“);<\/p>\n<\/p>\n

6. The Company153s Amended and Restated Certificate of Incorporation, filed
\nwith the Secretary of State of Delaware on August 14, 1998, as amended by the
\nCertificates of Amendment, filed on September 20, 2000 and May 31, 2006 (the
\n“Charter<\/em><\/strong>“);<\/p>\n<\/p>\n

7. The Company153s Amended and Restated Bylaws as currently in effect (the
\n“Bylaws<\/em><\/strong>“);<\/p>\n<\/p>\n

8. Resolutions of the Board of Directors of the Company adopted on October
\n22, 2010 and the resolutions of the Negotiating Committee of the Board of
\nDirectors adopted on October 26, 2010 (the
\n“Resolutions”<\/em><\/strong>);<\/p>\n<\/p>\n

9. The Company153s Annual Report on Form 10-K filed with the Commission on
\nFebruary 23, 2010 as amended by Form 10-K\/A filed with the Commission on August
\n19, 2010 (collectively, the “Form 10-K<\/em><\/strong>“) pursuant to
\nthe Securities Exchange Act of 1934 (the “Exchange
\nAct<\/em><\/strong>“);<\/p>\n<\/p>\n

10. The Company153s Quarterly Reports on Form 10-Q (the “Form
\n10-Qs<\/em><\/strong>“) filed with the Commission on May 4, 2010 and August 5,
\n2010;<\/p>\n<\/p>\n

11. The Company153s Current Reports on Form 8-K and Form 8-K\/A (the
\n“Form 8-Ks<\/em><\/strong>“) filed with the Commission from January
\n28, 2010 to the date hereof;<\/p>\n<\/p>\n

12. The Company153s 2010 Proxy Statement filed with the Commission on March 30,
\n2010 (together with the Form 10-K, the Form 10-Qs and the Form 8-Ks, the
\n“Exchange Act Reports<\/em><\/strong>“);<\/p>\n<\/p>\n

13. The minute books of the Company provided to us by one or more officers of
\nthe Company;<\/p>\n<\/p>\n

A-2<\/p>\n

\n

\n

14. The contracts of the Company listed on Exhibit A<\/u> attached to this
\nletter (the “Company Contracts<\/em><\/strong>“); and<\/p>\n<\/p>\n

15. One or more certificates provided to us by one or more officers of the
\nCompany.<\/p>\n<\/p>\n

The agreements and documents described in Items 3 through 5 above are
\nreferred to herein as the “Transaction Agreements<\/em><\/strong>.”\n<\/p>\n<\/p>\n

In rendering the opinions set forth below, we have assumed the legal capacity
\nof individuals, that the signatures on all documents not executed in our
\npresence are genuine, that all documents submitted to us as originals are
\nauthentic, that all documents submitted to us as reproduced or certified copies
\nconform to the original documents, that all corporate records of the Company
\nprovided to us for review are accurate and complete, and that any reviews and
\nsearches of public records obtained by us are accurate and complete. We have
\nfurther assumed that each of the parties to the Transaction Agreements (other
\nthan the Company) and each holder of the Firm Notes is duly qualified to engage
\nin the transactions contemplated by the Transaction Agreements and to hold the
\nFirm Notes; that the Transaction Agreements have been duly authorized, executed,
\nand delivered by, and constitute the valid and binding obligation of, the
\nInitial Purchasers and, in the case of the Indenture only, the Trustee, and is
\nenforceable against the Initial Purchasers and, in the case of the Indenture
\nonly, the Trustee, in accordance with their respective terms; that the parties
\nto the Transaction Agreements (other than the Company) and the holders of the
\nFirm Notes have the requisite power and authority to perform their respective
\nobligations under the Transaction Agreements; and that there are no documents,
\nagreements or understandings among or between any parties to the Transaction
\nAgreements and the holders of the Firm Notes or other agreements that would
\nmodify the respective rights and obligations of such parties as set forth in the
\nTransaction Agreements or that otherwise would have an effect on the opinions
\nrendered below.<\/p>\n<\/p>\n

As to matters of fact material to our opinions, we have relied solely upon
\nour review of the documents referred to in the second paragraph of this letter.
\nWe have assumed that the recitals of fact and the representations and warranties
\nof all parties as to factual matters set forth in the documents referred to
\nabove are true, complete and correct on the date hereof. We have not
\nindependently verified any factual matters or the validity of any assumptions
\nmade by us in this letter.<\/p>\n<\/p>\n

For purposes of rendering the opinions set forth in enumerated paragraphs 1
\nthrough 11 below, we have considered only Applicable Laws (as defined herein).
\n“Applicable Laws<\/em><\/strong>” means those laws, statutes, rules
\nand<\/p>\n<\/p>\n

A-3<\/p>\n

\n

\n

regulations of the State of California, the Delaware General Corporation Law
\n(the “DGCL<\/em><\/strong>“) and the federal laws of the United States
\nof America as presently in effect that, in our experience, are normally
\napplicable to a securities offering of the type contemplated by the Transaction
\nAgreements, other than the Excluded Laws (as defined herein).
\n“Excluded Laws<\/em><\/strong>” means any laws, statutes, rules or
\nregulations: (a) of any county, locality or municipality, (b) pertaining to
\ntaxes (except to the limited extent set forth in paragraph 9); securities
\n(except to the limited extent set forth in paragraphs 6 and 7 below); labor,
\nemployee or management relations; money laundering; privacy; environment; health
\nand safety; trade regulation; franchising; antitrust or unfair competition, (c)
\nrelating to choice of law or conflicts of law (except to the limited extent set
\nforth in paragraph 11 below), and\/or (d) to which the transactions are or may be
\nsubject because of the legal or regulatory status of any person other than the
\nCompany or because of any facts pertaining to any such person. We note that if
\nthe Transaction Agreements are not valid, binding and enforceable under the laws
\nof New York, the Transaction Agreements may not be enforced by a California
\ncourt under applicable conflicts-of-law principles. We call your attention to
\nthe fact that Excluded Laws may apply to the Transaction Agreements and express
\nno opinion with respect to the effect of Excluded Laws on the opinions set forth
\nherein.<\/p>\n<\/p>\n

Although the Transaction Agreements contain choice-of-law provisions
\nspecifying that they are governed by the laws of the State of New York, you are
\naware that we are not admitted to practice in the State of New York and you have
\nasked us to provide you with the opinions set forth below on the assumption (and
\nwe have therefore assumed) that the Transaction Agreements are governed by the
\nsubstantive laws of the State of California (without regard to conflicts-of-law
\nand choice-of-law principles), even though such assumption is or may be contrary
\nto fact. In addition, and without limiting the generality of the foregoing, you
\nhave asked us to provide you with this opinion on the assumption that each of
\nthe Company Contracts is governed by the substantive laws of the State of
\nCalifornia (without regard to conflicts-of-law and choice-of-law principles),
\neven though such assumption is or may be contrary to fact.<\/p>\n<\/p>\n

Whenever a statement or opinion herein is qualified by the phrase “known to
\nus,” “to our knowledge,” or any similar phrase, we intend to indicate that no
\ninformation that gives current actual knowledge of the inaccuracy of such
\nstatement or opinion has come to the attention of those attorneys in this law
\nfirm who have rendered legal services in connection with the representation of
\nthe Company. We have not undertaken or conducted any independent investigation
\nto determine the accuracy of statements or opinions herein qualified as
\ndescribed in the preceding sentence, and any limited inquiry undertaken by us
\nduring the preparation of this opinion letter should not be regarded as such an
\ninvestigation; no inference as to our knowledge of any matters bearing on the
\naccuracy of any<\/p>\n<\/p>\n

A-4<\/p>\n

\n

\n

such statement or opinion should be drawn from the fact of our representation
\nof the Company.<\/p>\n<\/p>\n

The opinions set forth below are subject to the following:<\/p>\n<\/p>\n

(i) In rendering our opinion in clause (c) of paragraph 2 of this letter, we
\nexpress no opinion as to financial covenants or similar provisions in the
\nCompany Contracts requiring financial calculations or determinations.<\/p>\n<\/p>\n

(ii) In rendering our opinion in paragraph 6 of this letter, we have assumed,
\nwithout investigation, that the Initial Purchasers153 representations in the
\nAgreement are correct.<\/p>\n<\/p>\n

(iii) In rendering our opinion in paragraphs 5, 6 and 7 of this letter, we
\nhave assumed that as of the date and time of the issuance of any shares of the
\nCompany153s Common Stock resulting from a conversion of the Firm Notes pursuant to
\nand as provided in the Firm Notes: (A) all of the Firm Notes being surrendered
\nupon such conversion will at that time be free and clear of any liens and
\nencumbrances; (B) all of the terms and conditions for such conversion set forth
\nin the Firm Notes will have been fully satisfied, waived or discharged; and (C)
\napplicable law, including its interpretation, will remain unchanged from the law
\nin effect as of the date of this letter. Subsequent dispositions, pledges or
\nother transfers of the Firm Notes without registration or qualification under
\nthe Securities Act may affect the availability of the exemptions from
\nregistration referred to in paragraph 6 of this letter. We have further assumed,
\nin rendering our opinion in paragraphs 5 and 7 of this letter, that sufficient
\nshares of the Company153s Common Stock issuable upon conversion of the Firm Notes
\npursuant to and as provided in the Firm Notes will remain duly authorized and
\navailable for issuance to satisfy the Company153s obligations upon such
\nconversion.<\/p>\n<\/p>\n

(iv) In rendering our opinion in paragraph 8 of this letter, we have relied
\non a certificate executed by one or more officers of the Company as to nature of
\nthe Company153s business and investments as of the date hereof, and we have
\nassumed that none of the net proceeds of the offering will be invested in
\nsecurities other than “Government securities” as such term is defined in the
\nInvestment Company Act of 1940, as amended (the “1940
\nAct<\/em><\/strong>“).<\/p>\n<\/p>\n

(v) In rendering our opinion in paragraph 11 of this letter, we have, with
\nyour permission, assumed the following factual matters: (a) one or more of the
\nInitial Purchasers has its headquarters office or a principal place of business
\nin the State of New York; (b) the Trustee has a substantial corporate presence
\nin the State of New York; (c) one or more senior executives of the Trustee153s
\ncorporate trust business are located in the State of New York; (d) the Trustee
\nhas negotiated the provisions of the Indenture with the material assistance of
\none or more agents of the Trustee located in the State of New York; and (e) one
\nor more agents of the<\/p>\n<\/p>\n

A-5<\/p>\n

\n

\n

Trustee located in the State of New York are anticipated to be involved in
\nthe performance of the Trustee153s obligations under the Indenture.<\/p>\n<\/p>\n

On the basis of the foregoing, and subject to the assumptions, exceptions,
\nlimitations and qualifications stated herein, we are of the opinion that:<\/p>\n<\/p>\n

1. The execution, delivery and performance of the Transaction Agreements by
\nthe Company have been duly authorized by all necessary corporate action on the
\npart of the Company.<\/p>\n<\/p>\n

2. The execution, delivery and performance by the Company on the date hereof
\nof its obligations under the Agreement, the Indenture and the Firm Notes do not
\n(a) violate the Charter or the Bylaws, (b) violate any judgment, writ, decree or
\norder of any court listed on Exhibit B hereto to which the Company is named as a
\nparty, (c) constitute a breach or default by the Company under the Company
\nContracts, except where such breach or default would not have a material adverse
\neffect on the Company; or (d) violate any Applicable Law, except any violation
\nthat would not have a material adverse effect on the Company, and subject to the
\nexceptions stated in paragraphs 4(i) through 4(xxiii) below.<\/p>\n<\/p>\n

3. The statements relating to the terms of the Firm Notes and the Indenture
\nin the Time of Sale Memorandum and the Final Memorandum under the caption
\n“Description of Notes,” insofar as such statements constitute summaries of legal
\nmatters or documents referred to therein, fairly summarize in all material
\nrespects such matters and documents. The Firm Notes, when executed and
\nauthenticated in accordance with the provisions of the Indenture and delivered
\nto and paid for by the Initial Purchasers in accordance with the terms of the
\nAgreement, will be valid and binding obligations of the Company, enforceable in
\naccordance with their terms, except as the validity, binding nature or
\nenforceability of the same may be limited by the exceptions stated in paragraphs
\n4(i) through 4(xxiii) below.<\/p>\n<\/p>\n

4. The Agreement and the Indenture have been duly executed and delivered by
\nthe Company. The Indenture constitutes a valid and binding obligation of the
\nCompany, enforceable against the Company in accordance with its terms, except as
\nthe validity, binding nature or enforceability of the same may be limited by:\n<\/p>\n<\/p>\n

(i) applicable federal or state bankruptcy, insolvency, reorganization,
\narrangement, moratorium, fraudulent transfer or conveyance, and other laws or
\ncourt decisions relating to or affecting the rights of creditors;<\/p>\n<\/p>\n

A-6<\/p>\n

\n

\n

(ii) equitable principles of general applicability (including, without
\nlimitation, concepts of materiality, reasonableness, good faith and fair
\ndealing, equitable subordination, and the possible unavailability of specific
\nperformance or injunctive relief), regardless of whether considered in a
\nproceeding in equity or at law or whether codified by statute;<\/p>\n<\/p>\n

(iii) California judicial decisions which have held that certain provisions,
\nincluding without limitation those providing for the acceleration of
\nindebtedness upon the occurrence of specified events, are unenforceable under
\ncircumstances where it cannot be demonstrated that the enforcement of such
\nprovisions (a) is reasonably necessary for the protection of the party seeking
\nenforcement, (b) has been undertaken in good faith under the circumstances then
\nexisting, and (c) is commercially reasonable;<\/p>\n<\/p>\n

(iv) the effect of Section 1670.5 of the California Civil Code, which
\nprovides that a court may refuse to enforce a contract or limit the application
\nthereof or of any clause thereof which the court finds as a matter of law to
\nhave been unconscionable at the time it was made;<\/p>\n<\/p>\n

(v) the unenforceability, under certain circumstances, of provisions that
\ncontain prospective waivers of (a) vaguely or broadly stated rights, (b) unknown
\nfuture rights, (c) the benefits of statutory, regulatory or constitutional
\nrights, unless and to the extent the statute, regulation or constitution
\nexplicitly permits such waiver, (d) unknown future defenses and (e) rights to
\ndamages;<\/p>\n<\/p>\n

(vi) the unenforceability of provisions prohibiting waivers that are not in
\nwriting to the extent that Section 1698 of the California Civil Code (or similar
\nprovisions of other applicable laws) permits oral modifications that have been
\nperformed;<\/p>\n<\/p>\n

(vii) the unenforceability, under certain circumstances, of provisions to the
\neffect that rights or remedies are not exclusive, that every right or remedy is
\ncumulative and may be exercised in addition to or with any other right or
\nremedy, or that the election of some particular remedy or remedies does not
\npreclude recourse to one or another remedy;<\/p>\n<\/p>\n

(viii) the potential to vary the terms of the Indenture on the basis of parol
\nevidence;<\/p>\n<\/p>\n

A-7<\/p>\n

\n

\n

(ix) limitations on the enforceability of indemnification, release,
\ncontribution, exculpatory or nonliability provisions under federal or state
\nsecurities laws, under Sections 1542, 1543 and 2772-78 of the California Civil
\nCode, and under any other applicable statute or court decisions, including,
\nwithout limitation, the effect of California statutes and cases applying such
\nstatutes which have denied enforcement of indemnification agreements against the
\nindemnitee153s negligence, wrongdoing or violation of law;<\/p>\n<\/p>\n

(x) the effect of Section 1717, et seq. of the California Civil Code and
\njudicial decisions thereunder on provisions which purport to require the award
\nof attorneys153 fees, expenses or costs;<\/p>\n<\/p>\n

(xi) the unenforceability, under certain circumstances, of provisions which
\ndirectly or indirectly purport to effect a jury trial waiver;<\/p>\n<\/p>\n

(xii) the unenforceability, under certain circumstances, of arbitration or
\nother alternative dispute resolution provisions;<\/p>\n<\/p>\n

(xiii) the unenforceability, under certain circumstances, of provisions which
\npurport to govern forum selection, venue, personal jurisdiction or subject
\nmatter jurisdiction;<\/p>\n<\/p>\n

(xiv) the unenforceability, under certain circumstances, of provisions which
\npurport to appoint a party as attorney-in-fact or agent for an adverse party;\n<\/p>\n<\/p>\n

(xv) the effect of Section 23301, et seq. of the California Revenue and
\nTaxation Code, which provides that a party to a contract may, under certain
\ncircumstances, void the contract if the other party (irrespective of the
\njurisdiction of organization or domicile of such other party) fails to file any
\nrequired California tax returns and\/or pay any required California franchise or
\nincome taxes;<\/p>\n<\/p>\n

(xvi) the effect of Section 564 of the California Code of Civil Procedure and
\nother provisions of California law which impose certain restrictions on the
\nenforceability of provisions that provide for the appointment of a receiver;\n<\/p>\n<\/p>\n

(xvii) the unenforceability, under certain circumstances, of provisions which
\npurport to authorize a judicial referee to order injunctive or other provisional
\nor similar extraordinary relief;<\/p>\n<\/p>\n

A-8<\/p>\n

\n

\n

(xviii) the unenforceability of provisions concerning offsets, self-help or
\nsummary remedies, to the extent that enforcement of such provisions is
\ndetermined by a court to be unreasonable under then existing circumstances;<\/p>\n<\/p>\n

(xix) the unenforceability, under certain circumstances, of provisions which
\nprovide for penalties, liquidated damages, acceleration of future amounts due
\n(other than principal) without appropriate discount to present value, prepayment
\ncharges, late charges, additional interest in the event of a default or fees or
\ncosts related to such charges;<\/p>\n<\/p>\n

(xx) the effect of Sections 3275 and 3302 of the California Civil Code and
\nother provisions of California law which impose limitations on the
\nenforceability of time-is-of-the-essence clauses;<\/p>\n<\/p>\n

(xxi) without limiting the generality of subparagraph (v) above, the effect
\nof Union Bank v. Gradsky<\/u>, 265 Cal. App. 2d 40 (1968), and Cathay Bank
\nv. Lee<\/u>, 14 Cal. App. 4th 1533 (1993) and their progeny, which impose certain
\nlimitations upon the effectiveness of waivers;<\/p>\n<\/p>\n

(xxii) the unenforceability, under certain circumstances, of provisions of
\nagreements purporting to establish evidentiary standards or to render
\ndeterminations by any party conclusive; and<\/p>\n<\/p>\n

(xxiii) the effect of the restrictions in Article XV of the Constitution of
\nthe State of California upon provisions relating to rates of interest on the
\nloan of money.<\/p>\n<\/p>\n

5. The shares of Common Stock of the Company that are issuable pursuant to
\nand upon conversion of the Firm Notes as provided in the Indenture and the Firm
\nNotes (the “Shares<\/em><\/strong>“) have been duly authorized and
\nreserved in accordance with the Resolutions, assuming such conversion takes
\nplace immediately following the closing on the Closing Date. The Shares, when
\nissued and delivered upon conversion of the Firm Notes in accordance with the
\nterms of such Firm Notes and the Indenture, will be validly issued, fully paid
\nand nonassessable. The stockholders of the Company have no preemptive rights
\nunder the Charter, the Bylaws or the DGCL.<\/p>\n<\/p>\n

6. The sale of the Firm Notes pursuant to the Agreement constitutes a
\ntransaction exempt from the registration requirements under Section 5 of the
\nSecurities Act and does not require qualification of an indenture in respect
\nthereof under the Trust Indenture Act of 1939, as amended.<\/p>\n<\/p>\n

A-9<\/p>\n

\n

\n

7. No consent, approval or authorization of, or designation, declaration or
\nfiling with, any California or federal governmental authority is required by the
\nCompany under any Applicable Law in connection with the execution, delivery and
\nperformance by the Company of the Transaction Agreements in accordance with
\ntheir respective terms other than: (i) those that have already been obtained and
\nare in full force and effect; or (ii) as required by state securities or Blue
\nSky laws, as to which we express no opinion.<\/p>\n<\/p>\n

8. The Company is not, and will not become as a result of the consummation of
\nthe transactions contemplated by the Agreement, an “investment company” as
\ndefined in the 1940 Act.<\/p>\n<\/p>\n

9. The statements in the Time of Sale Memorandum and the Final Memorandum
\nunder the caption “Material U.S. Federal Tax Considerations,” insofar as such
\nstatements purport to constitute a summary of the consequences to certain
\nholders under the United States federal tax laws referred to therein, are
\naccurate and fairly summarize such consequences in all material respects.<\/p>\n<\/p>\n

10. The statements in the Time of Sale Memorandum and the Final Memorandum
\nunder the caption “Description of Capital Stock,” insofar as such statements
\nconstitute summaries of the legal matters or documents referred to therein,
\nfairly summarize the matters referred to therein in all material respects.<\/p>\n<\/p>\n

11. Assuming a court of the State of California has jurisdiction, in a
\nproceeding in a court of the State of California for the enforcement of the
\nIndenture, the court should, assuming that Section 18.04 of the Indenture
\nproviding for the choice of New York law to govern the Indenture and the Firm
\nNotes is enforceable under the laws of New York, give effect to Section 18.04 of
\nthe Indenture, except to the extent that (i) any provision of the Indenture is
\ndetermined by the court to be contrary to a fundamental policy of the state
\nwhose law would apply in the absence of that Section, and (ii) that state has a
\nmaterially greater interest in the determination of the particular issue than
\ndoes the state whose law is chosen.<\/p>\n<\/p>\n

In connection with the preparation of the Time of Sale Memorandum and the
\nFinal Memorandum, we have participated in conferences with officers and other
\nrepresentatives of the Company, representatives of the independent public
\naccountants of the Company and representatives of the Initial Purchasers,
\nincluding its counsel, at which the contents of the Time of Sale Memorandum and
\nthe Final Memorandum were discussed. Although we have not independently
\nverified, are not passing upon and do not assume responsibility for the
\naccuracy, completeness or fairness of the statements contained in the Time of
\nSale Memorandum or the Final Memorandum or any amendments or supplements
\nthereto, except as described above in the first sentence of paragraph 3 and in\n<\/p>\n<\/p>\n

A-10<\/p>\n

\n

\n

paragraphs 9 and 10, on the basis of the foregoing, nothing has come to our
\nattention that causes us to believe that: (A) the Time of Sale Memorandum (other
\nthan financial statements, schedules and notes and other financial information
\nincluded or incorporated by reference therein or derived therefrom, as to which
\nwe express no comment), as of its date or as of the date hereof, contained or
\ncontains an untrue statement of a material fact or omitted or omits to state a
\nmaterial fact required to be stated therein or necessary to make the statements
\ntherein, in light of the circumstances under which they were made, not
\nmisleading or (B) the Final Memorandum (other than financial statements,
\nschedules and notes and other financial information included or incorporated by
\nreference therein or derived therefrom, as to which we express no comment), as
\nof its date or as of the date hereof, contained or contains an untrue statement
\nof a material fact or omitted or omits to state a material fact required to be
\nstated therein or necessary to make the statements therein, in light of the
\ncircumstances under which they were made, not misleading.<\/p>\n<\/p>\n

Our opinions pertain only to the Transaction Agreements themselves, and do
\nnot encompass, cover or pertain to, or take into account the potential effect on
\nthe opinions rendered above of, any agreement attached as a schedule or an
\nexhibit to the Transaction Agreements, referred to in the Transaction Agreements
\nor executed contemporaneously with the Transaction Agreements.<\/p>\n<\/p>\n

In rendering our opinions, we have assumed that the parties have acted and
\nwill act in accordance with the express terms of the Transaction Agreements and
\nthe rights and obligations of the parties thereunder, and we express no opinion
\nwith respect to the effect of any party153s failure to so comply or act.<\/p>\n<\/p>\n

Notwithstanding anything in this opinion letter to the contrary, the opinions
\nset forth above are given only as of the date hereof. We disclaim any obligation
\nto update any of the opinions rendered herein and express no opinion as to the
\neffect of events occurring, circumstances arising, or changes of law becoming
\neffective or occurring, after the date hereof on the matters addressed in this
\nopinion letter, and we assume no responsibility to inform you of additional or
\nchanged facts, or changes in law, of which we may become aware.<\/p>\n<\/p>\n

A-11<\/p>\n

\n

\n

The opinions set forth above are expressly limited to the matters stated. No
\nopinion is implied or may be inferred beyond what is explicitly stated in this
\nletter. This letter is rendered solely for your benefit in connection with the
\ntransactions contemplated by the Transaction Agreements and may not be relied
\nupon by any other party. Copies of this letter may not be circulated or
\nfurnished to any other person or entity (except your attorneys and other
\nadvisors) and this letter may not be referred to in any report or document
\nfurnished to any other person or entity, without our prior written consent.<\/p>\n<\/p>\n

Very truly yours,<\/p>\n<\/p>\n

HOWARD RICE NEMEROVSKI CANADY
\nFALK & RABKIN
\nA Professional Corporation<\/p>\n<\/p>\n\n\n\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

By:<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Julia Vax<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

A-12<\/p>\n

\n

\n

Exhibit A<\/u>
\nCompany Contracts<\/p>\n

\n

1. Indenture dated as of June 1, 2004, between the Company and Wells Fargo
\nBank, N.A. as trustee, including therein the form of the Note.<\/p>\n<\/p>\n

2. Form of Indemnity Agreement between the Company and each of its directors
\nand executive officers.<\/p>\n<\/p>\n

3. Consent to Assignment and Assumption of Lease dated April 22, 1998 between
\nCSM Investors, Inc., IntraNet Integration Group, Inc. and the Company.<\/p>\n<\/p>\n

4. Assignment of Lease dated April 21, 1998 between Intranet Integration
\nGroup, Inc. and the Company.<\/p>\n<\/p>\n

5. Lease Agreement dated January 18, 2000 between Property Reserve, Inc. and
\nthe Company.<\/p>\n<\/p>\n

6. First Amendment of Lease dated January 31, 2001 to that certain Lease
\ndated April 24, 1996 between CSM Investors, Inc. and the Company (as assignee of
\nIntranet Integration Group, Inc.).<\/p>\n<\/p>\n

7. 1998 Stock Option Plan, as amended and superseded by 1998 Equity Incentive
\nPlan.<\/p>\n<\/p>\n

8. 1999 Stock Option Plan, formerly known as the 1999 Non-Officer Stock
\nOption Plan, as amended.<\/p>\n<\/p>\n

9. 2000 Employee Stock Purchase Plan, as amended, and offering.<\/p>\n<\/p>\n

10. Second Amendment of Lease dated April 22, 2002 to that certain Lease
\ndated April 24, 1996 between CSM Investors, Inc. and the Company (as assignee of
\nIntranet Integration Group, Inc.) as amended.<\/p>\n<\/p>\n

11. Second Amendment of Lease dated April 28, 2003 to that certain Lease
\ndated January 18, 2000 between Property Reserve Inc. and the Company.<\/p>\n<\/p>\n

12. Registration Rights Agreement dated as of June 1, 2004, between the
\nCompany and the initial purchasers of Senior Convertible Notes due January 1,
\n2024.<\/p>\n<\/p>\n

A-13<\/p>\n

\n

\n

13. Second Amended and Restated Symantec Online Store Agreement, between
\nSymantec Corporation, Symantec Limited, the Company. and Digital River Ireland
\nLimited effective April 1, 2006.<\/p>\n<\/p>\n

14. 1998 Equity Incentive Plan (formerly known as 1998 Stock Option Plan)
\neffective March 4, 2008.<\/p>\n<\/p>\n

15. Amended and Restated Employment Agreement for Joel A. Ronning dated
\nFebruary 28, 2007.<\/p>\n<\/p>\n

16. Change of Control and Severance Agreement for Thomas M. Donnelly
\neffective March 4, 2008.<\/p>\n<\/p>\n

17. Form of Amendment to Non-Qualified Stock Option Agreement.<\/p>\n<\/p>\n

18. Inducement Equity Incentive Plan effective December 15, 2005. .<\/p>\n<\/p>\n

19. 2007 Equity Incentive Plan.<\/p>\n<\/p>\n

20. Change of Control and Severance Agreement for Kevin L. Crudden dated
\nMarch 4, 2008.<\/p>\n<\/p>\n

21. Microsoft Operations Digital Distribution Agreement, between the Company
\nand Microsoft Corporation effective September 1, 2006.<\/p>\n<\/p>\n

22. Direct Reseller Addendum to the Microsoft Operations Digital Distribution
\nAgreement, between the Company and Microsoft Corporation effective September 1,
\n2006.<\/p>\n<\/p>\n

23. Omnibus Amendment to the Microsoft Operations Digital Distribution
\nAgreement, between the Company and Microsoft Corporation effective October 4,
\n2007.<\/p>\n<\/p>\n

24. Amendment to the Microsoft Operations Digital Distribution Agreement,
\nbetween the Company. and Microsoft Corporation effective December 2, 2008.<\/p>\n<\/p>\n

25. Amendment to the Microsoft Operations Digital Distribution Agreement,
\nbetween the Company and Microsoft Corporation effective September 9, 2009.<\/p>\n<\/p>\n

26. Second Omnibus Amendment to the Microsoft Operations Digital Distribution
\nAgreement between the Company and Microsoft Corporation effective August 20,
\n2010.<\/p>\n<\/p>\n

A-14<\/p>\n

\n

\n

EXHIBIT B<\/strong><\/p>\n

\n

OPINION OF KEVIN CRUDDEN, VICE PRESIDENT AND
\nGENERAL COUNSEL OF THE COMPANY<\/strong><\/p>\n

\n

[Digital River, Inc. Letterhead]<\/p>\n

\n

November ___, 2010<\/p>\n

\n

Merrill Lynch, Pierce, Fenner & Smith Incorporated
\nMorgan Stanley & Co. Incorporated
\nAs Representatives of the Initial Purchasers<\/p>\n<\/p>\n

c\/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
\nOne Bryant Park
\nNew York, NY 10036<\/p>\n<\/p>\n

c\/o Morgan Stanley & Co. Incorporated
\n1585 Broadway
\nNew York, NY 10036<\/p>\n<\/p>\n

Re: Digital River, Inc.<\/u><\/strong><\/p>\n<\/p>\n

Ladies and Gentlemen:<\/p>\n<\/p>\n

I am Vice President and General Counsel of Digital River, Inc., a Delaware
\ncorporation (the “Company<\/em><\/strong>“).<\/p>\n<\/p>\n

This opinion is rendered to you at the request of the Company pursuant to
\nSection 5(d) of the Purchase Agreement dated October 26, 2010 (the
\n“Agreement<\/em><\/strong>“), by and among you, as representatives of
\nthe several Initial Purchasers named therein, and the Company regarding the
\noffering of up to $300,000,000 aggregate principal amount of 2.00% Convertible
\nSenior Notes due 2030. Capitalized terms used but not defined herein have the
\nsame meanings given them in the Agreement.<\/p>\n<\/p>\n

In this connection, I have examined original or copies of the following
\ndocuments, each of which is dated the date hereof (unless otherwise specified):\n<\/p>\n<\/p>\n

1. The Time of Sale Memorandum for the Firm Notes (as defined below) dated
\nOctober 26, 2010 (the “Time of Sale Memorandum<\/em><\/strong>“);<\/p>\n<\/p>\n

B-1<\/p>\n

\n

\n

2. The Final Memorandum for the Firm Notes dated October [26], 2010 (the
\n“Final Memorandum<\/em><\/strong>“);<\/p>\n<\/p>\n

3. The Agreement;<\/p>\n<\/p>\n

4. The Indenture dated November 1, 2010 between the Company and Wells Fargo
\nBank, N.A. as trustee (the “Trustee<\/em><\/strong>“) (the
\n“Indenture<\/em><\/strong>“);<\/p>\n<\/p>\n

5. The 2.00% Convertible Senior Notes dated November 1, 2010, issued by the
\nCompany in favor of the Initial Purchasers pursuant to the Agreement as of the
\ndate hereof (the “Firm Notes<\/em><\/strong>“);<\/p>\n<\/p>\n

6. The Company153s Amended and Restated Certificate of Incorporation, filed
\nwith the Secretary of State of Delaware on August 14, 1998, as amended by the
\nCertificates of Amendment, filed on September 20, 2000 and May 31, 2006 (the
\n“Charter<\/em><\/strong>“);<\/p>\n<\/p>\n

7. The Company153s Amended and Restated Bylaws as currently in effect (the
\n“Bylaws<\/em><\/strong>“);<\/p>\n<\/p>\n

8. The resolutions of the Board of Directors of the Company adopted on
\nOctober 22, 2010 and the resolutions of the Negotiating Committee of the Board
\nof Directors adopted on October 26, 2010 (the
\n“Resolutions<\/em><\/strong>“).<\/p>\n<\/p>\n

9. Certificates, each dated as of a recent date, from the Secretaries of
\nState of the States of Delaware, California, Minnesota and Washington as to the
\ngood standing of the Company in such states, and a certificate, dated as of a
\nrecent date, from the Secretary of State of the State of California as to the
\ngood standing of BlueHornet Networks, Inc. in such state (collectively,
\n“Domestic Good Standings<\/em><\/strong>“);<\/p>\n<\/p>\n

10. Certificates, each dated as of a recent date, from the Register of
\nCompanies of the Companies Registration Office of Ireland, as to the status of
\nDigital River Technology Limited and the status of Digital River Ireland Limited
\nin that country, and from Handelsregister B of the Cologne District Office, as
\nto the status of Digital River GmbH in that country (collectively,
\n“Foreign Good Standings<\/em><\/strong>“);<\/p>\n<\/p>\n

11. The Company153s Annual Report on Form 10-K (the “Form
\n10-K<\/em><\/strong>“) filed with the Commission for the year ended December 31,
\n2009, as amended on August 19, 2010 pursuant to the Securities Exchange Act of
\n1934 (the “Exchange Act<\/em><\/strong>“);<\/p>\n<\/p>\n

B-2<\/p>\n

\n

\n

12. The Company153s Quarterly Reports on Form 10-Q (the “Form
\n10-Qs<\/em><\/strong>“) filed with the Commission for the quarters ended March 31,
\n2010 and June 30, 2010;<\/p>\n<\/p>\n

13. The Company153s Current Reports on Form 8-K and Form 8-K\/A (the
\n“Form 8-Ks<\/em><\/strong>“) filed with the Commission from January
\n28, 2010 to the date hereof;<\/p>\n<\/p>\n

14. The Company153s 2010 Proxy Statement filed with the Commission on March 30,
\n2010 (together with the Form 10-K, the Form 10-Qs, the Form 8-Ks, the
\n“Exchange Act Reports<\/em><\/strong>“);<\/p>\n<\/p>\n

15. The Company153s Registration Statement on Form 8-A, as filed on July 20,
\n1998;<\/p>\n<\/p>\n

16. The minute books of the Company;<\/p>\n<\/p>\n

17. The minute books of each of the Significant Subsidiaries (as defined
\nbelow);<\/p>\n<\/p>\n

18. Such corporate records, certificates and other documents (of which I am
\naware) and such questions of law as I have considered necessary or appropriate
\nfor the purposes of rendering the opinions that follow.<\/p>\n<\/p>\n

The agreements and documents described in Items 3 through 5 above are
\nreferred to herein as the “Transaction Agreements<\/em><\/strong>.”\n<\/p>\n<\/p>\n

The opinions set forth below are subject to the following:<\/p>\n<\/p>\n

(i) My opinion in paragraph 1 below is based solely on my review of a
\ncertified copy of the Charter and copies of the Bylaws, the minute books of the
\nCompany, and the Domestic Good Standings.<\/p>\n<\/p>\n

(ii) My opinion in paragraph 2 below is based solely on my review of the
\nForeign Good Standings, and the minute books of each Significant Subsidiary (as
\ndefined below).<\/p>\n<\/p>\n

(iii) My opinion in paragraph 5 below is based solely on my personal actual
\nknowledge and the docket or complaint searches in the following jurisdictions
\nand databases: (a) Courtlink (courtlink.lexisnexis.com) for the dockets of the
\nDelaware Court of Chancery; (b) the U.S. Party\/Case Index
\n(pacer.uspci.uscourts.gov) for the dockets of civil cases in federal district
\ncourts in which the Company is named as a party; and (c) Westlaw
\n(www.westlaw.com<\/u>) for the dockets of the Minnesota Supreme Court, Court
\nof Appeals, District<\/p>\n<\/p>\n

B-3<\/p>\n

\n

\n

Courts, Tax Court and Workers153 Compensation Court of Appeals in which the
\nCompany is named as a party.<\/p>\n<\/p>\n

In giving the opinions that follow I have relied as to matters of fact
\nwithout investigation, to the extent I deemed proper, upon certificates from
\nofficers of the Company and certain of its affiliates, and one or more
\ncertificates, facsimiles, and other documents from, and oral conversations with,
\npublic officials. I have assumed without investigation the authenticity of each
\ndocument submitted to me as an original, the conformity to the originals of each
\ndocument submitted to me as a copy, the authenticity of the originals of such
\nlatter documents, the genuineness of all signatures, and the legal capacity of
\nall natural persons.<\/p>\n<\/p>\n

Based on and subject to the foregoing, it is my opinion that:<\/p>\n<\/p>\n

1. The Company has been duly incorporated, is a validly existing corporation
\nin good standing under the laws of the State of Delaware, has the corporate
\npower and authority to own its property and conduct its business as described in
\nthe Time of Sale Memorandum, and is duly qualified to transact business as a
\nforeign corporation in the states of California, Minnesota and Washington.<\/p>\n<\/p>\n

2. Each of BlueHornet Networks, Inc., Digital River GmbH, Digital River
\nTechnology Limited and Digital River Ireland Limited (together, the
\n“Significant Subsidaries<\/em><\/strong>“) is in good standing (or a
\nforeign country equivalent thereof) under the laws of the jurisdiction of its
\nincorporation; all of the issued shares of capital stock of each Significant
\nSubsidiary are owned directly or indirectly by the Company, free and clear of
\nall liens, encumberances, equities or claims.<\/p>\n<\/p>\n

3. The shares of Common Stock of the Company outstanding as of the Closing
\nDate have been duly authorized and validly issued, and are fully paid and non
\nassessable.<\/p>\n<\/p>\n

4. The statements (a) in “Item 3 : Legal Proceedings” of the Company153s Form
\n10-K for the year ended December 31, 2009, (b) in “Item 1 : Legal Proceedings”
\nof Part II of the Company153s quarterly reports on Form 10-Q for the quarters
\nended March 31, 2010 and June 30, 2010 and (c) in “Item 8.01 : Other Events” in
\neach current report on Form 8-K included or incorporated by reference in the
\nTime of Sale Memorandum and in the Final Memorandum, in each case insofar as
\nsuch statements constitute summaries of the legal matters, documents or
\nproceedings referred to therein, as of the respective filing dates thereof,
\nfairly summarizesuch legal matters, documents and proceedings in all material
\nrespects.<\/p>\n<\/p>\n

B-4<\/p>\n

\n

\n

5. Except as included or incorporated by reference in the Time of Sale
\nMemorandum, I do not know of any legal or governmental proceedings pending or
\nthreatened to which the Company or any of its subsidiaries is a party or to
\nwhich any of the properties of the Company or any of its subsidiaries is subject
\nthat would reasonably be expected to result in a material adverse effect on the
\nCompany and its subsidiaries, taken as a whole, or on the Company153s ability to
\nperform its obligations under the Transaction Agreements or to consummate the
\ntransactions contemplated by the Time of Sale Memorandum.<\/p>\n<\/p>\n

6. The Exchange Act Reports or portions thereof incorporated by reference in
\nthe Time of Sale Memorandum or Final Memorandum comply as to form in all
\nmaterial respects with the requirements of the Exchange Act and the applicable
\nrules and regulations thereunder; provided, however, that I express no view as
\nto the financial statements, schedules and notes and other financial information
\nincluded therein or derived therefrom.<\/p>\n<\/p>\n

The opinions expressed herein are given as of the date hereof only, and are
\nnot given as of any later date. I have not undertaken any factual or legal
\ninvestigation beyond the date hereof, and I disclaim any obligation to notify
\nyou or any other person after the date hereof if any change in fact and\/or law
\nshould change my opinion with respect to any matters set forth herein.<\/p>\n<\/p>\n

I am a member of the bar of the State of Minnesota. I express no opinion as
\nto any laws of any other jurisdiction other than the laws of the State of
\nDelaware and federal laws of the United States to the extent applicable to the
\nscope of the opinions expressed above. Further, I express no opinion regarding
\nchoice of law or conflicts of laws.<\/p>\n<\/p>\n

This opinion is rendered to you as the Initial Purchasers under the Agreement
\nand may not be relied upon for any other purpose or by any other person without
\nmy express written consent.<\/p>\n<\/p>\n\n\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Very truly yours,<\/p>\n

Kevin L. Crudden
\nVice President and General Counsel<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

B-5<\/p>\n

\n

\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

EXHIBIT C<\/strong><\/p>\n

\n

OPINION OF DAVIS POLK & WARDWELL LLP<\/strong><\/p>\n

\n

The opinion of Davis Polk & Wardwell LLP to be delivered pursuant to
\nSection 5(d) of the Purchase Agreement shall be to the effect that:<\/p>\n<\/p>\n

A. The Purchase Agreement has been duly authorized, executed and delivered by
\nthe Company.<\/p>\n<\/p>\n

B. The Securities have been duly authorized by the Company and, when executed
\nand authenticated in accordance with the provisions of the Indenture and
\ndelivered to and paid for by the Initial Purchasers in accordance with the terms
\nof the Purchase Agreement, will be valid and binding obligations of the Company,
\nenforceable in accordance with their terms, subject to applicable bankruptcy,
\ninsolvency and similar laws affecting creditors153 rights generally, concepts of
\nreasonableness and equitable principles of general applicability, and will be
\nentitled to the benefits of the Indenture pursuant to which such Securities are
\nto be issued.<\/p>\n<\/p>\n

C. The Underlying Securities issuable upon conversion of the Securities have
\nbeen duly authorized and reserved and, when issued upon conversion of the
\nSecurities in accordance with the terms of the Securities, will be validly
\nissued, fully paid and non-assessable, and the issuance of the Underlying
\nSecurities will not be subject to any preemptive or similar rights.<\/p>\n<\/p>\n

D. The Indenture has been duly authorized, executed and delivered by, and is
\na valid and binding agreement of, the Company, enforceable in accordance with
\nits terms, subject to applicable bankruptcy, insolvency and similar laws
\naffecting creditors153 rights generally, concepts of reasonableness and equitable
\nprinciples of general applicability.<\/p>\n<\/p>\n

E. The statements relating to legal matters, documents or proceedings
\nincluded in (1) the Time of Sale Memorandum and the Final Memorandum under the
\ncaptions “Description of Securities”, “Description of Capital Stock” and
\n“Transfer Restrictions” and (2) in the Final Memorandum under the caption “Plan
\nof Distribution” in each case fairly summarize in all material respects such
\nmatters, documents and proceedings.<\/p>\n<\/p>\n

F. Nothing has come to the attention of such counsel to cause such counsel to
\nbelieve that (i) the Time of Sale Memorandum (except for the financial
\nstatements and financial schedules and other financial data, as to which such
\ncounsel need not express any belief) as of the date of the Purchase Agreement or
\nas amended or supplemented, if applicable, as of the date such opinion is
\ndelivered contained or contains any untrue statement of a material fact or
\nomitted<\/p>\n<\/p>\n

C-1<\/p>\n

\n

\n

or omits to state a material fact necessary in order to make the statements
\ntherein, in the light of the circumstances under which they were made, not
\nmisleading or (ii) the Final Memorandum (except for the financial statements and
\nfinancial schedules and other financial and, as to which such counsel need not
\nexpress any belief) when issued contained, or as of the date such opinion is
\ndelivered, contains, any untrue statement of a material fact or omitted or omits
\nto state a material fact necessary in order to make the statements therein, in
\nthe light of the circumstances under which they were made, not misleading.<\/p>\n<\/p>\n

With respect to the matters referred to in the paragraph above, Davis Polk
\n& Wardwell LLP may state that their beliefs are based upon their
\nparticipation in the preparation of the Time of Sale Memorandum and the Final
\nMemorandum (and any amendments or supplements thereto) and review and discussion
\nof the contents thereof (including the review of, but not participation in the
\npreparation of, the incorporated documents), but are without independent check
\nor verification except as specified.<\/p>\n<\/p>\n

G. Based upon the representations, warranties and agreements of the Company
\nin Sections 1(r), 1(s), 1(u), 6(h), 6(i) and 6(l) of the Purchase Agreement and
\nof the Initial Purchasers in Section 7 of the Purchase Agreement, it is not
\nnecessary in connection with the offer, sale and delivery of the Securities to
\nthe Initial Purchasers under the Purchase Agreement or in connection with the
\ninitial resale of such Securities by the Initial Purchasers in accordance with
\nSection 7 of the Purchase Agreement to register the Securities under the
\nSecurities Act of 1933 or to qualify the Indenture under the Trust Indenture Act
\nof 1939, it being understood that no opinion is expressed as to any subsequent
\nresale of any Security or Underlying Security.<\/p>\n<\/p>\n

C-2<\/p>\n

\n

\n

EXHIBIT D<\/strong><\/p>\n

\n

[FORM OF LOCK-UP LETTER]<\/strong><\/p>\n

\n

_____________, 20___<\/p>\n<\/p>\n

Merrill Lynch, Pierce, Fenner & Smith Incorporated
\nMorgan Stanley & Co. Incorporated<\/p>\n<\/p>\n

As Representatives of the several Initial Purchasers named in Schedule I to
\nthe Purchase Agreement referred to below<\/p>\n<\/p>\n

c\/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
\nOne Bryant Park
\nNew York, NY 10036<\/p>\n

c\/o Morgan Stanley & Co. Incorporated
\n1585 Broadway
\nNew York, NY 10036<\/p>\n<\/p>\n

Ladies and Gentlemen:<\/p>\n<\/p>\n

The undersigned understands that you, as Representatives of the several
\nInitial Purchasers (the “Initial Purchasers<\/strong>“) propose to enter
\ninto a Purchase Agreement (the “Purchase Agreement<\/strong>“) with
\nDigital River, Inc., a Delaware corporation (the “Company<\/strong>“),
\nproviding for the offering (the “Offering<\/strong>“) by the Company to
\nthe several Initial Purchasers of approximately $250,000,000 principal amount of
\nConvertible Senior Notes due 2030 (the “Securities<\/strong>“). The
\nSecurities will be convertible into shares of common stock, par value $0.01, of
\nthe Company (the “Common Stock<\/strong>“).<\/p>\n<\/p>\n

To induce the Initial Purchasers that may participate in the Offering to
\ncontinue their efforts in connection with the Offering, the undersigned hereby
\nagrees that, without the prior written consent of the Representatives on behalf
\nof the Initial Purchasers, the undersigned will not, during the period
\ncommencing on the date hereof and ending 90 days after the date of the final
\noffering memorandum relating to the Offering (the “Final Memorandum”), (1)
\noffer, pledge, sell, contract to sell, sell any option or contract to purchase,
\npurchase any option or contract to sell, grant any option, right or warrant to
\npurchase, lend, or otherwise transfer or dispose of, directly or indirectly, any
\nshares of Common Stock beneficially owned (as such term is used in Rule 13d-3 of
\nthe Securities<\/p>\n<\/p>\n

D-1<\/p>\n

\n

\n

Exchange Act of 1934, as amended (the “Exchange Act”)), by the undersigned or
\nany other securities so owned convertible into or exercisable or exchangeable
\nfor Common Stock or (2) enter into any swap or other arrangement that transfers
\nto another, in whole or in part, any of the economic consequences of ownership
\nof the Common Stock, whether any such transaction described in clause (1) or (2)
\nabove is to be settled by delivery of Common Stock or such other securities, in
\ncash or otherwise. The foregoing sentence shall not apply to (a) transactions
\nrelating to shares of Common Stock or other securities acquired in open market
\ntransactions after the completion of the Offering, provided that no filing under
\nSection 16(a) of the Exchange Act shall be required or shall be voluntarily made
\nin connection with subsequent sales of Common Stock or other securities acquired
\nin such open market transactions, (b) transactions relating to shares of Common
\nStock at any time if the number of shares involved in such transactions,
\ntogether with all shares of Common Stock involved in such transactions by all
\nother officers and directors; of the Company who are subject to a letter similar
\nto this letter does not in the aggregate exceed 400,000 shares of Common Stock
\nof the Company, (c) transfers of shares of Common Stock or any security
\nconvertible into Common Stock (i) to the immediate family or trust of the
\nundersigned or (ii) during the lifetime or upon death of the undersigned, by
\nbona fide gift, will or intestacy provided that in the case of any transfer or
\ndistribution pursuant to clause (c)(i) or (ii), each donee or distributee shall
\nsign and deliver a lock up letter substantially in the form of this letter, (d)
\nthe establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange
\nAct for the transfer of shares of Common Stock, provided that such plan does not
\nprovide for the transfer of Common Stock during the 90-day restricted period and
\nno public announcement or filing under the Exchange Act regarding the
\nestablishment of such plan shall be required of or voluntarily made by or on
\nbehalf of the undersigned or the Company, (e) the exercise of any options to
\nacquire shares of Common Stock pursuant to an equity incentive plan of the
\nCompany existing as of the date hereof, provided that any shares of Common Stock
\nreceived upon such exercise will be subject to the provisions and restrictions
\nherein or (f) in the case of any restricted stock or performance shares held by
\nthe undersigned that vest or are forfeited during the 90-day restricted period,
\nthe disposition of shares of such restricted stock or performance shares to the
\nCompany to pay withholding tax obligations incurred by the undersigned upon such
\nvesting (but only to such extent) or to deliver forfeited shares, provided that
\nany required filing under Section 16(a) of the Exchange Act in connection with
\nsuch disposition clearly indicates such purpose.1<\/sup> In addition, the
\nundersigned agrees that, without the prior<\/p>\n<\/p>\n\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

1<\/sup><\/p>\n<\/td>\n

<\/td>\n\n

The lock-up agreement for Joel Ronning, CEO, will also contain the following
\ncarve-out:<\/p>\n<\/td>\n<\/tr>\n

<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n\n

“(e) the offer, sale, contract to sell, pledge dispositions or exercises by
\nthe undersigned of that certain call option, consisting of the right to purchase
\nCommon Stock, obtained by the undersigned on November 9, 2009 and expiring on
\nJanuary 22, 2011.”<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

D-2<\/p>\n

\n

\n

written consent of the Representatives on behalf of the Initial Purchasers,
\nit will not, during the period commencing on the date hereof and ending 90 days
\nafter the date of the Final Memorandum, make any demand for or exercise any
\nright with respect to, the registration of any shares of Common Stock or any
\nsecurity convertible into or exercisable or exchangeable for Common Stock. The
\nundersigned also agrees and consents to the entry of stop transfer instructions
\nwith the Company153s transfer agent and registrar against the transfer of the
\nundersigned153s shares of Common Stock except in compliance with the foregoing
\nrestrictions.<\/p>\n<\/p>\n

The undersigned understands that the Company and the Initial Purchasers are
\nrelying upon this agreement in proceeding toward consummation of the Offering.
\nThe undersigned further understands that this agreement is irrevocable and shall
\nbe binding upon the undersigned153s heirs, legal representatives, successors and
\nassigns. This Agreement shall lapse and become null and void if the Offering has
\nnot been consummated on or before November 30, 2010.<\/p>\n<\/p>\n

Whether or not the Offering actually occurs depends on a number of factors,
\nincluding market conditions. Any Offering will only be made pursuant to a
\nPurchase Agreement, the terms of which are subject to negotiation between the
\nCompany and the Initial Purchasers.<\/p>\n<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

Very truly yours,<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

(Name)<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n\n

(Address)<\/p>\n<\/td>\n

<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

D-3<\/p>\n

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