-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CJHRLaAjfXeV6cT8YIkF+cXWFAB/b6YJxVvWJq8+faBZO+JoqLIM3U0OCiRKpdXE tQLUlEeJh2hPHQ4NwgAGKw== 0001104659-09-002553.txt : 20090115 0001104659-09-002553.hdr.sgml : 20090115 20090115162045 ACCESSION NUMBER: 0001104659-09-002553 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20090115 DATE AS OF CHANGE: 20090115 GROUP MEMBERS: CHARLES R. KAYE GROUP MEMBERS: JOSEPH P. LANDY GROUP MEMBERS: WARBURG PINCUS & CO. GROUP MEMBERS: WARBURG PINCUS LLC GROUP MEMBERS: WARBURG PINCUS PARTNERS, LLC GROUP MEMBERS: WARBURG PINCUS PRIVATE EQUITY X, L.P. GROUP MEMBERS: WARBURG PINCUS X PARTNERS, L.P. GROUP MEMBERS: WARBURG PINCUS X, L.P. GROUP MEMBERS: WARBURG PINCUS X, LLC SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: Nuance Communications, Inc. CENTRAL INDEX KEY: 0001002517 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 943156479 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-49737 FILM NUMBER: 09528854 BUSINESS ADDRESS: STREET 1: 1 WAYSIDE ROAD CITY: BURLINGTON STATE: MA ZIP: 01803 BUSINESS PHONE: 781-565-5000 MAIL ADDRESS: STREET 1: 1 WAYSIDE ROAD CITY: BURLINGTON STATE: MA ZIP: 01803 FORMER COMPANY: FORMER CONFORMED NAME: SCANSOFT INC DATE OF NAME CHANGE: 19990312 FORMER COMPANY: FORMER CONFORMED NAME: VISIONEER INC DATE OF NAME CHANGE: 19951020 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: WARBURG PINCUS PRIVATE EQUITY VIII L P CENTRAL INDEX KEY: 0001157334 IRS NUMBER: 134161869 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 466 LEXINGTON AVENUE CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2128780600 MAIL ADDRESS: STREET 1: 466 LEXINGTON AVENUE CITY: NEW YORK STATE: NY ZIP: 10017 SC 13D/A 1 a09-3214_1sc13da.htm SC 13D/A

	UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	Washington, D.C. 20549

	SCHEDULE 13D

(Amendment No. 6)

Under the Securities Exchange Act of 1934*

NUANCE COMMUNICATIONS, INC.

(Name of Issuer)

Common Stock, $0.001 Par Value

(Title of Class of Securities)

80603P107

(CUSIP Number)

Scott A. Arenare, Esq.

Managing Director and General Counsel

Warburg Pincus LLC

466 Lexington Avenue

New York, New York 10017

(212) 878-0600

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

Copies to:

Steven J. Gartner, Esq.

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, NY 10019-6099

(212) 728-8000

January 13, 2009

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box: o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Warburg Pincus Private Equity VIII, L.P. 13-4161869

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) N/A

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization Delaware

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 51,737,426 (see Items 4 and 5)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 51,737,426 (see Item 5)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(1)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 26.8% (see Item 5)

	14	Type of Reporting Person (See Instructions) PN

(1) This amount assumes the closing of the transactions contemplated by the 2009 Purchase Agreement (as defined herein). Neither the filing of this Schedule 13D/A nor any of its contents shall be deemed to constitute an admission that any Reporting Persons (as defined herein) beneficially own the securities contemplated to be issued pursuant to such 2009 Purchase Agreement.

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Nos. of above persons (entities only) Warburg Pincus & Co. 13-6358475

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) N/A

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization New York

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 72,995,474 (see Items 4 and 5)(2)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 72,995,474 (see Item 5)(3)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(4)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 26.4% (see Item 5)

	14	Type of Reporting Person (See Instructions) PN

(2) See footnote 1.

(3) See footnote 1.

(4) See footnote 1.

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Nos. of above persons (entities only) Warburg Pincus LLC 13-3536050

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) N/A

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization New York

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 72,995,474 (see Items 4 and 5)(5)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 72,995,474 (see Item 5)(6)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(7)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 26.4% (see Item 5)

	14	Type of Reporting Person (See Instructions) OO

(5) See footnote 1.

(6) See footnote 1.

(7) See footnote 1.

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Warburg Pincus Partners, LLC 13-4069737

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) N/A

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization New York

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 72,995,474 (see Items 4 and 5)(8)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 72,995,474 (see Item 5)(9)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(10)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 26.4% (see Item 5)

	14	Type of Reporting Person (See Instructions) OO

(8) See footnote 1.

(9) See footnote 1.

(10) See footnote 1.

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Warburg Pincus Private Equity X, L.P. 26-0849130

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) WC

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization Delaware

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 20,599,049 (see Items 4 and 5)(11)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 20,599,049 (see Item 5)(12)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(13)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 27.9% (see Item 5)

	14	Type of Reporting Person (See Instructions) PN

(11) See footnote 1.

(12) See footnote 1.

(13) See footnote 1.

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Warburg Pincus X Partners, L.P. 26-0869910

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) WC

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization Delaware

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 658,999 (see Items 4 and 5)(14)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 658,999 (see Item 5)(15)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(16)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 28.3% (see Item 5)

	14	Type of Reporting Person (See Instructions) PN

(14) See footnote 1.

(15) See footnote 1.

(16) See footnote 1.

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Warburg Pincus X, L.P. 26-0403670

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) N/A

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization Delaware

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 21,258,048 (see Items 4 and 5)(17)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 21,258,048 (see Item 5)(18)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(19)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 27.9% (see Item 5)

	14	Type of Reporting Person (See Instructions) PN

(17) See footnote 1.

(18) See footnote 1.

(19) See footnote 1.

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Warburg Pincus X, LLC 26-0403605

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) N/A

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization Delaware

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 21,258,048 (see Items 4 and 5)(20)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 21,258,048 (see Item 5)(21)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(22)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 27.9% (see Item 5)

	14	Type of Reporting Person (See Instructions) OO

(20) See footnote 1.

(21) See footnote 1.

(22) See footnote 1.

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Charles R. Kaye

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) N/A

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization United States of America

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 72,995,474 (see Items 4 and 5)(23)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 72,995,474 (see Item 5)(24)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(25)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 26.4% (see Item 5)

	14	Type of Reporting Person (See Instructions) IN

(23) See footnote 1.

(24) See footnote 1.

(25) See footnote 1.

CUSIP No. 80603P107

	1	Names of Reporting Persons I.R.S. Identification Joseph P. Landy

	2	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			x

	3	SEC Use Only

	4	Source of Funds (See Instructions) N/A

	5	Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) o

	6	Citizenship or Place of Organization United States of America

Number of Shares Beneficially Owned by Each Reporting Person With			7	Sole Voting Power 0

			8	Shared Voting Power 72,995,474 (see Items 4 and 5)(26)

			9	Sole Dispositive Power 0

			10	Shared Dispositive Power 72,995,474 (see Item 5)(27)

	11	Aggregate Amount Beneficially Owned by Each Reporting Person 72,995,474 (see Item 5)(28)

	12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13	Percent of Class Represented by Amount in Row (11) 26.4% (see Item 5)

	14	Type of Reporting Person (See Instructions) IN

(26) See footnote 1.

(27) See footnote 1.

(28) See footnote 1.

This Amendment No. 6 to Schedule 13D (“Amendment No. 6”) amends the Schedule 13D originally filed on April 19, 2004 (“Original 13D”), as amended by Amendment No. 1 to Schedule 13D filed on May 10, 2005, as further amended by Amendment No. 2 to Schedule 13D filed on September 19, 2005, as further amended by Amendment No. 3 to Schedule 13D filed on August 29, 2006, as further amended by Amendment No. 4 to Schedule 13D filed on April 8, 2008, and as further amended by Amendment No. 5 to Schedule 13D filed on May 21, 2008 (as so amended, the “Amended 13D”), each filed on behalf of Warburg Pincus Private Equity VIII, L.P., a Delaware limited partnership, Warburg Pincus & Co., a New York general partnership, Warburg Pincus LLC, a New York limited liability company, Warburg Pincus Partners, LLC, a New York limited liability company, and Messrs. Charles R. Kaye and Joseph P. Landy, each a Managing General Partner of WP and Co-President and Managing Member of WP LLC. In addition, this Amendment No. 6 is also filed on behalf of Warburg Pincus Private Equity X, L.P., a Delaware limited partnership, Warburg Pincus X Partners, L.P., a Delaware limited partnership, Warburg Pincus X, L.P., a Delaware limited partnership, and Warburg Pincus X LLC, a Delaware limited liability company. This Amendment No. 6 relates to the common stock, par value $0.001 per share, of Nuance Communications, Inc., a Delaware corporation formerly known as ScanSoft, Inc. (the “Company”). The holdings of Warburg Pincus Private Equity VIII, L.P., a Delaware limited partnership, reported in this Amendment No. 6 include the holdings of Warburg Pincus Netherlands Private Equity VIII, C.V. I (“WPNPE I”) and WP-WPVIII Investors, L.P. (“WP-WPVIII”), which shares the Reporting Persons (as defined below) may be

deemed to beneficially own. Capitalized terms used herein which are not defined herein have the meanings given to them in the Original 13D and any amendments thereto.

Item 2.

Identity and Background

Item 2 of the Amended 13D is amended and restated in its entirety as follows:

(a) This Schedule 13D is being filed by Warburg Pincus Private Equity X, L.P., a Delaware limited partnership (“WP X”), Warburg Pincus X Partners, L.P., a Delaware limited partnership (“WPP X” and, together with WP X, the “WP X Funds”), Warburg Pincus X, L.P., a Delaware limited partnership and the sole general partner of each of the WP X Funds (“WP X LP”), Warburg Pincus X LLC, a Delaware limited liability company and the sole general partner of WP X LP (“WP X LLC”), Warburg Pincus Private Equity VIII, L.P., a Delaware limited partnership (“WP VIII” and, together with WPNPE I and WP-WPVIII the “WP VIII Funds”; and together with the WP X Funds, the “Funds”), Warburg Pincus Partners, LLC, a New York limited liability company and the sole member of WP X LLC and the general partner of WP VIII (“WPP LLC”), Warburg Pincus LLC, a New York limited liability company that manages each of the Funds (“WP LLC”), and Warburg Pincus & Co., a New York general partnership and the managing member of WPP LLC (“WP”), and Messrs. Charles R. Kaye and Joseph P. Landy, each a Managing General Partner of WP and Co-President and Managing Member of WP LLC (Mr. Kaye, Mr. Landy, WP VIII, WP X, WPP X, WP X LP, WP X LLC, WPP LLC, WP LLC and WP collectively being referred to as the “Reporting Persons”).

The Reporting Persons are making this single, joint filing because they may be deemed to constitute a “group” within the meaning of Section 13(d)(3) of the Exchange Act. The amended and restated Joint Filing Agreement among the Reporting Persons to

file this Schedule 13D jointly in accordance with Rule 13d-1(k) of the Exchange Act is attached hereto as Exhibit 99.5 (the “Joint Filing Agreement”).

(b) The address of the principal business and principal office of each of the Reporting Persons is c/o Warburg Pincus LLC, 466 Lexington Avenue, New York, New York 10017. The general partners of WP and the members and managing directors of WP LLC, and their respective business addresses, are set forth on Schedule I hereto.

(c) The principal business of the Funds is that of making private equity and related investments. The principal business of WP is acting as the managing member of WPP LLC. The principal business of WPP LLC is acting as general partner to certain private equity funds, including WP VIII, and as the sole member of WP X LLC. The principal business of WP X LLC is acting as general partner of WP X LP. The principal business of WP X LP is acting as general partner of the WP X Funds. The principal business of WP LLC is managing certain private equity funds, including the Funds. The principal business of each Mr. Kaye and Mr. Landy is acting as a Managing General Partner of WP and Co-President and Managing Member of WP LLC. The principal occupation of each of the general partners of WP and the members of WP LLC is set forth on Schedule I hereto.

(d) During the last five years, none of the Reporting Persons and, to the knowledge of the Reporting Persons, none of the general partners, members or directors named on Schedule I, has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

(e) During the last five years, none of the Reporting Persons and, to the knowledge of the Reporting Persons, none of the general partners, members or directors

named on Schedule I, has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree, or final order enjoining future violations of, or prohibiting or mandating activity subject to, federal or state securities laws or finding any violations with respect to such laws.

(f) WP VIII, WP X, WPP X and WP X LP are each limited partnerships organized under the laws of the State of Delaware. WPP LLC and WP LLC are each limited liability companies organized under the laws of the State of New York. WP X LLC is a limited liability company organized under the laws of the State of Delaware. WP is a general partnership organized under the laws of the State of New York. Messrs. Kaye and Landy are citizens of the United States of America. Except as otherwise indicated on Schedule I hereto, each of the individuals referred to on Schedule I hereto is a citizen of the United States of America.

Item 3.

Source and Amount of Funds or Other Consideration.

Item 3 of the Amended 13D is hereby amended and restated in its entirety as follows:

The total amount of funds used by the WP VIII Funds to purchase the securities of the Company as described herein was furnished from the working capital of such Fund. The total amount of funds paid by the WP VIII Funds to purchase the securities of the Company as described herein is $270,524,907.54. The total amount of funds that will be paid by the WP X Funds to purchase the securities of the Company as described herein will be furnished from the working capital of such Fund. The total amount of funds that will be paid by the WP X Funds to purchase the securities of the Company contemplated

by the 2009 Purchase Agreement (as defined below) upon the closing of the transactions contemplated by the 2009 Purchase Agreement is $175,241,398.94.

Item 4.

Purpose of Transaction.

Item 4 of the Amended 13D is hereby amended by adding the following to the end thereof:

Pursuant to a Purchase Agreement, dated January 13, 2009 (the “2009 Purchase Agreement”), by and among the WP X Funds and the Company, the WP X Funds agreed to acquire from the Company (a) an aggregate of 17,395,626 shares of Common Stock at a price per share equal to $10.06, and for an aggregate purchase price of $174,999,997.56; and (b) warrants to purchase an aggregate of 3,862,422 shares of Common Stock with a per share exercise price of $11.57, and for an aggregate purchase price of $241,401.38 (the “2009 Warrants”). The obligation of the WP Funds to consummate the transactions contemplated by the 2009 Purchase Agreement is subject to certain conditions, including, without limitation, the expiration or termination of the waiting period under the Hart-Scott-Rodino Act Antitrust Improvements Act of 1976, as amended. Each of the 2009 Warrants will expire upon the earlier to occur of the fourth anniversary of the issuance of the 2009 Warrants or a “Change of Control” of the Company (as defined in the 2009 Warrants).

Pursuant to a Warrant Amendment Agreement, dated January 13, 2009 (the “Warrant Amendment Agreement”), by and among WP VIII, WPNPE I, WP-WPVIII and the Company, the parties thereto agreed to extend the expiration dates of the Adjustable Warrant and Securities Purchase Warrants. In accordance with the Warrant Amendment Agreement, the expiration date of the Adjustable Warrant has been extended to the date (the “Adjustable Warrant Expiration Date”) that is one day following the fifth (5th)

Business Day (as defined in the 2009 Purchase Agreement) after the six (6) month anniversary of the Closing Date (as defined in the 2009 Purchase Agreement); provided, however, that if the 2009 Purchase Agreement is terminated pursuant to its terms, the Adjustable Warrant Expiration Date shall be the date that is one day following the fifth (5th) Business Day after the later of (a) March 2, 2009, or (b) the date of termination of the 2009 Purchase Agreement. In accordance with the Warrant Amendment Agreement, the expiration date of the Securities Purchase Warrants has been extended to the date (the “Securities Purchase Warrant Expiration Date”) that is one day following the fifth (5th) Business Day after the six (6) month anniversary of the Closing Date; provided, however, that if the 2009 Purchase Agreement is terminated pursuant to its terms, the Securities Purchase Warrant Expiration Date shall be the date that is one day following the fifth (5th) Business Day after the later of (a) May 9, 2009, or (b) the date of termination of the 2009 Purchase Agreement.

Upon the closing of the transactions contemplated by the 2009 Purchase Agreement, the Company and each of the Funds agreed to amend and restate that certain Second Amended and Restated Stockholders Agreement, dated as of May 20, 2008, by entering into that certain Third Amended and Restated Stockholders Agreement substantially in the form attached hereto as Exhibit 99.4 (the “Third Restated Stockholders Agreement”).

The foregoing descriptions of the 2009 Purchase Agreement, the 2009 Warrants, the Warrant Amendment Agreement and the Third Restated Stockholders Agreement are qualified in their entirety by reference to the 2009 Purchase Agreement, the 2009 Warrants, Warrant Amendment Agreement and the Third Restated Stockholders

Agreement, which are incorporated in this Amendment No. 6 by reference to Exhibits 99.1, 99.2, 99.3 and 99.4 respectively, to this Amendment No. 6.

Item 5.

Interest in Securities of the Issuer

Items 5(a), (b) and (c) of the Amended 13D are hereby amended and restated in their entirety as follows:

(a) Due to their respective relationships with the Funds and each other, as of January 15, 2009, each of the Reporting Persons may be deemed to beneficially own, in the aggregate, 54,804,276 shares of Common Stock. As of January 15, 2009, the Reporting Persons may also be deemed to beneficially own additional shares of Common Stock by virtue of certain of the following securities which the Funds’ may be deemed to beneficially own: the Series B Preferred Stock; the Adjustable Warrant; the March 15 Warrants; the Securities Purchase Warrants; the Stock Purchase Warrants; the 2008 Warrants; and the 2009 Warrants (collectively, the “Convertible Securities”). Assuming the full exercise and conversion of the Convertible Securities, the Reporting Persons may be deemed to beneficially own 72,995,474 shares of Common Stock, representing approximately 26.4% of the outstanding class of Common Stock, based on a total of 276,101,737 shares of Common Stock outstanding, which is comprised of: (i) 240,514,913 shares of Common Stock outstanding as of October 31, 2008, as represented in the Company’s Form 10-K for the fiscal year ended September 30, 2008 (the “Form 10-K”); (ii) the 3,562,238 shares of Common Stock issuable upon the conversion of the 3,562,238 shares of Series B Preferred Stock acquired by certain of the Funds; (iii) the 525,732 shares of Common Stock presently issuable upon the exercise of the Adjustable Warrant, as represented by the Company in the Form 10-K; (iv) the 2,500,000 shares of Common Stock issuable upon the exercise of the March 15 Warrants;

(v) the 863,236 shares of Common Stock presently issuable upon the exercise of the Securities Purchase Warrants; (vi) the 3,177,570 shares of Common Stock presently issuable upon the exercise of the Stock Purchase Warrants; (vii) the 3,700,000 shares of Common Stock presently issuable upon the exercise of the 2008 Warrants; (viii) the 3,862,422 shares of Common Stock acquirable upon the exercise of the 2009 Warrants if issued pursuant to the terms set forth in the 2009 Purchase Agreement; and (ix) the 17,395,626 shares of Common Stock acquirable pursuant to the 2009 Purchase Agreement. The foregoing computations assume the closing of the transactions contemplated by the 2009 Purchase Agreement occurs, including the issuance to the WP X Funds of an aggregate of 17,395,626 shares of Common Stock and warrants to purchase an aggregate of 3,862,422 shares of Common Stock in connection with such closing.

(b) Each of WP X LP, WP X LLC, WPP LLC, WP LLC and WP may be deemed to share with the WP X Funds the power to vote or to direct the vote and to dispose or to direct the disposition of the 21,258,048 shares of Common Stock the WP X Funds may be deemed to beneficially own as of January 15, 2009. Each of WPP LLC, WP LLC and WP may be deemed to share with WP VIII the power to vote or to direct the vote and to dispose or to direct the disposition of the 51,737,426 shares of Common Stock WP VIII may be deemed to beneficially own as of January 15, 2009. Charles R. Kaye and Joseph P. Landy are Managing General Partners of WP and Managing Members and Co-Presidents of WP LLC and may be deemed to control the other Reporting Persons. Messrs. Kaye and Landy disclaim beneficial ownership of all shares held by the Funds. Neither the filing of this Schedule 13D nor any of its contents shall be

deemed to constitute an admission that any Reporting Person or any of its affiliates is the beneficial owner of any shares of Common Stock for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, or for any other purpose.

(c) Except as described in this Amendment No. 6 and other than (x) the grant on January 1, 2009, by the Company to William Janeway, a General Partner of WP and a Member and Senior Advisor of WP LLC, of 15,000 shares of restricted Common Stock of the Company that were issued to Mr. Janeway in his capacity as a director of the Company and (y) the grant on January 1, 2009, by the Company to Jeffrey Harris, a General Partner of WP and a Member and a Managing Director of WP LLC, of 15,000 shares of restricted Common Stock of the Company that were issued to Mr. Harris in his capacity as a director of the Company, during the last sixty (60) days there were no transactions in the Common Stock effected by the Reporting Persons, nor, to the best of their knowledge, any of their directors, executive officers, general partners or members.

Item 6.

Contracts, Arrangements, Understandings or Relationships With Respect to the Securities of the Issuer.

Item 6 of the Amended 13D is hereby amended by adding the following at the end of the discussion:

As described in Item 4 hereto, the WP X Funds entered into the 2009 Purchase Agreement and, simultaneous with the closing of the transactions contemplated by the 2009 Purchase Agreement, the Funds and Company will enter into the Third Restated Stockholders Agreement and the Company and the WP X Funds will execute the 2009 Warrants. As described in Item 4 hereto, WP VIII, WPNPE I, WP-WPVIII and the Company entered into the Warrant Amendment Agreement pursuant to which the expiration dates of the Adjustable Warrant and Securities Purchase Warrants were

extended. The information set forth in Item 4 with respect to the 2009 Purchase Agreement, the Third Restated Stockholders Agreement, the 2009 Warrants and the Warrant Amendment Agreement is incorporated into this Item 6 by reference.

Item 7. Material to Be Filed as Exhibits

Exhibit 99.1.		2009 Purchase Agreement, dated as of January 13, 2009, by and among the Company and the WP X Funds

Exhibit 99.2.		Form of 2009 Warrant

Exhibit 99.3.		Warrant Amendment Agreement, dated January 13, 2009, by and among WP VIII, WPNPE I, WP-WPVIII and the Company

Exhibit 99.4.		Form of Third Amended and Restated Stockholders Agreement

Exhibit 99.5.		Amended and Restated Joint Filing Agreement, dated January 15, 2009, among the Reporting Persons

SIGNATURES

After reasonable inquiry and to the best of our knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct.

Dated: January 15, 2009	WARBURG PINCUS PRIVATE EQUITY VIII, L.P.

			By:	Warburg Pincus Partners, LLC,
				its General Partner

				By:	Warburg Pincus & Co.,
					its Managing Member


	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS PRIVATE EQUITY X, L.P.
			By:	Warburg Pincus X L.P.,
				its General Partner

			By:	Warburg Pincus X LLC,
				its General Partner

			By:	Warburg Pincus Partners, LLC,
				its Sole Member

			By:	Warburg Pincus & Co.,
				its Managing Member

	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS X PARTNERS, L.P.
			By:	Warburg Pincus X L.P.,
				its General Partner

			By:	Warburg Pincus X LLC,
				its General Partner

			By:	Warburg Pincus Partners, LLC,
				its Sole Member

			By:	Warburg Pincus & Co.,
				its Managing Member

	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS X, LLC
			By:	Warburg Pincus Partners, LLC,
				its Sole Member

			By:	Warburg Pincus & Co.,
				its Managing Member

	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS X, L.P.
			By:	Warburg Pincus X LLC,
				its General Partner

			By:	Warburg Pincus Partners, LLC,
				its Sole Member

			By:	Warburg Pincus & Co.,
				its Managing Member

	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Member

Dated: January 15, 2009	WARBURG PINCUS PARTNERS, LLC
			By:	Warburg Pincus & Co.,
				its Managing Member


	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS LLC


	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Managing Director

Dated: January 15, 2009	WARBURG PINCUS & CO.


	By:	/s/ Scott A. Arenare
	Name: Scott A. Arenare
	Title: Partner

Dated: January 15, 2009


	By:	/s/ Scott A. Arenare
	Name: Charles R. Kaye
	By: Scott A. Arenare, Attorney-in-Fact*

Dated: January 15, 2009


	By:	/s/ Scott A. Arenare
	Name: Joseph P. Landy
	By: Scott A. Arenare, Attorney-in-Fact**

* Power of Attorney given by Mr. Kaye was previously filed with the SEC on March 2, 2006 as an exhibit to a Schedule 13D filed by Building Products, LLC with respect to Builders FirstSource, Inc.

** Power of Attorney given by Mr. Landy was previously filed with the SEC on March 2, 2006 as an exhibit to a Schedule 13D filed by Building Products, LLC with respect to Builders FirstSource, Inc.

SCHEDULE I

Set forth below is the name, position and present principal occupation of each of the general partners of Warburg Pincus & Co. (“WP”) and members of Warburg Pincus LLC (“WP LLC”). Except as otherwise indicated, the business address of each of such persons is c/o Warburg Pincus LLC, 466 Lexington Avenue, New York, New York 10017, and each of such persons is a citizen of the United States.

GENERAL PARTNERS OF WP

NAME		PRESENT PRINCIPAL OCCUPATION IN ADDITION TO POSITION WITH WP, AND POSITIONS WITH THE REPORTING ENTITIES

Scott A. Arenare		Partner of WP; Member and Managing Director of WP LLC

David Barr		Partner of WP; Member and Managing Director of WP LLC

Alexander Berzofsky		Partner of WP; Member and Managing Director of WP LLC

Sean D. Carney		Partner of WP; Member and Managing Director of WP LLC

Mark Colodny		Partner of WP; Member and Managing Director of WP LLC

David A. Coulter		Partner of WP; Member and Managing Director of WP LLC

Timothy J. Curt		Partner of WP; Member and Managing Director of WP LLC

Cary J. Davis		Partner of WP; Member and Managing Director of WP LLC

Steven Glenn		Partner of WP; Member and Managing Director of WP LLC

Michael Graff		Partner of WP; Member and Managing Director of WP LLC

Patrick T. Hackett		Partner of WP; Member and Managing Director of WP LLC

E. Davisson Hardman		Partner of WP; Member and Managing Director of WP LLC

Jeffrey A. Harris		Partner of WP; Member and Managing Director of WP LLC

Stewart J. Hen		Partner of WP; Member and Managing Director of WP LLC

In Seon Hwang		Partner of WP; Member and Managing Director of WP LLC

William H. Janeway		Partner of WP; Member and Senior Advisor of WP LLC

Chansoo Joung		Partner of WP; Member and Managing Director of WP LLC

Peter R. Kagan		Partner of WP; Member and Managing Director of WP LLC

Charles R. Kaye		Managing General Partner of WP; Managing Member and Co-President of WP LLC

Henry Kressel		Partner of WP; Member and Managing Director of WP LLC

David Krieger		Partner of WP; Member and Managing Director of WP LLC

Kevin Kruse		Partner of WP; Member and Managing Director of WP LLC

Joseph P. Landy		Managing General Partner of WP; Managing Member and Co-President of WP LLC

Kewsong Lee		Partner of WP; Member and Managing Director of WP LLC

Jonathan S. Leff		Partner of WP; Member and Managing Director of WP LLC

Philip Mintz		Partner of WP; Member and Managing Director of WP LLC

James Neary		Partner of WP; Member and Managing Director of WP LLC

Dalip Pathak		Partner of WP; Member and Managing Director of WP LLC

Michael F. Profenius		Partner of WP; Member and Managing Director of WP LLC

Justin Sadrian		Partner of WP; Member and Managing Director of WP LLC

Henry B. Schacht		Partner of WP; Member and Senior Advisor of WP LLC

Steven G. Schneider		Partner of WP; Member and Managing Director of WP LLC

Patrick Severson		Partner of WP; Member and Managing Director of WP LLC

John Shearburn		Partner of WP; Member and Managing Director of WP LLC

Barry Taylor		Partner of WP; Member and Managing Director of WP LLC

Christopher H. Turner		Partner of WP; Member and Managing Director of WP LLC

John L. Vogelstein		Partner of WP; Member and Senior Advisor of WP LLC

Elizabeth H. Weatherman		Partner of WP; Member and Managing Director of WP LLC

Rosanne Zimmerman		Partner of WP; Member and Managing Director of WP LLC

Pincus & Company LLC*

WP & Co. Partners, L.P.**

Warburg Pincus Principal Partnership, L.P.***

Warburg Pincus Real Estate Principal Partnership, L.P.***

Warburg Pincus 2006 Limited Partnership***

Warburg Pincus 2007 Limited Partnership***

*		New York limited liability company; primary activity is ownership interest in WP and WP LLC

**		New York limited partnership; primary activity is ownership interest in WP

***		Delaware limited partnership; primary activity is ownership interest in WP

MEMBERS OF WP LLC

NAME		PRESENT PRINCIPAL OCCUPATION IN ADDITION TO POSITION WITH WP LLC, AND POSITIONS WITH THE REPORTING ENTITIES

Scott A. Arenare		Member and Managing Director of WP LLC; Partner of WP

Pedro Aznar (1)		Member and Managing Director of WP LLC

David Barr		Member and Managing Director of WP LLC; Partner of WP

Alexander Berzofsky		Member and Managing Director of WP LLC; Partner of WP

Sean D. Carney		Member and Managing Director of WP LLC; Partner of WP

Julian Cheng (2)		Member and Managing Director of WP LLC

Stephen John Coates (3)		Member and Managing Director of WP LLC

Mark Colodny		Member and Managing Director of WP LLC; Partner of WP

David A. Coulter		Member and Managing Director of WP LLC; Partner of WP

Timothy J. Curt		Member and Managing Director of WP LLC; Partner of WP

Cary J. Davis		Member and Managing Director of WP LLC; Partner of WP

Robert Feuer (4)		Member and Managing Director of WP LLC

Rajiv Ghatalia (2)		Member and Managing Director of WP LLC

Steven Glenn		Member and Managing Director of WP LLC; Partner of WP

Michael Graff		Member and Managing Director of WP LLC; Partner of WP

Patrick T. Hackett		Member and Managing Director of WP LLC; Partner of WP

E. Davisson Hardman		Member and Managing Director of WP LLC; Partner of WP

Jeffrey A. Harris		Member and Managing Director of WP LLC; Partner of WP

Stewart J. Hen		Member and Managing Director of WP LLC; Partner of WP

In Seon Hwang		Member and Managing Director of WP LLC; Partner of WP

William H. Janeway		Member and Senior Advisor of WP LLC; Partner of WP

Chansoo Joung		Member and Managing Director of WP LLC; Partner of WP

Peter R. Kagan		Member and Managing Director of WP LLC; Partner of WP

Charles R. Kaye		Managing Member and Co-President of WP LLC; Managing General Partner of WP

Rajesh Khanna (5)		Member and Managing Director of WP LLC

Henry Kressel		Member and Managing Director of WP LLC; Partner of WP

David Krieger		Member and Managing Director of WP LLC; Partner of WP

Kevin Kruse		Member and Managing Director of WP LLC; Partner of WP

Joseph P. Landy		Managing Member and Co-President of WP LLC; Managing General Partner of WP

Kewsong Lee		Member and Managing Director of WP LLC; Partner of WP

Jonathan S. Leff		Member and Managing Director of WP LLC; Partner of WP

David Li (2)		Member and Managing Director of WP LLC

Vishal Mahadevia (5)		Member and Managing Director of WP LLC

Niten Malhan (5)		Member and Managing Director of WP LLC

Philip Mintz		Member and Managing Director of WP LLC; Partner of WP

Luca Molinari (6)		Member and Managing Director of WP LLC

James Neary		Member and Managing Director of WP LLC; Partner of WP

Dalip Pathak		Member and Managing Director of WP LLC; Partner of WP

Michael F. Profenius		Member and Managing Director of WP LLC; Partner of WP

Leo Puri (5)		Member and Managing Director of WP LLC

Justin Sadrian		Member and Managing Director of WP LLC; Partner of WP

Adarsh Sarma (5)		Member and Managing Director of WP LLC

Henry B. Schacht		Member and Senior Advisor of WP LLC; Partner of WP

Steven G. Schneider		Member and Managing Director of WP LLC; Partner of WP

Joseph C. Schull (7)		Member and Managing Director of WP LLC

Patrick Severson		Member and Managing Director of WP LLC; Partner of WP

John Shearburn		Member and Managing Director of WP LLC; Partner of WP

Chang Q. Sun (2)		Member and Managing Director of WP LLC

Barry Taylor		Member and Managing Director of WP LLC; Partner of WP

Christopher H. Turner		Member and Managing Director of WP LLC; Partner of WP

Simon Turton (3)		Member and Managing Director of WP LLC

John L. Vogelstein		Member and Senior Advisor of WP LLC; Partner of WP

Elizabeth H. Weatherman		Member and Managing Director of WP LLC; Partner of WP

Peter Wilson (3)		Member and Managing Director of WP LLC

Jeremy S. Young (3)		Member and Managing Director of WP LLC

Rosanne Zimmerman		Member and Managing Director of WP LLC; Partner of WP

Pincus & Company LLC*

(1) Citizen of Germany

(2) Citizen of Hong Kong

(3) Citizen of United Kingdom

(4) Citizen of Hungary

(5) Citizen of India

(6) Citizen of Italy

(7) Citizen of Canada

* New York limited liability company; primary activity is ownership interest in WP and WP LLC

As of January 1, 2009

EX-99.1 2 a09-3214_1ex99d1.htm EX-99.1

Exhibit 99.1

PURCHASE

AGREEMENT

Dated as of January 13, 2009

by and among

NUANCE COMMUNICATIONS, INC.

and

the Purchasers identified on Exhibit A hereto

TABLE OF CONTENTS

		Page

ARTICLE I	Purchase and Sale of Common Stock	1

Section 1.1	Purchase and Sale of Common Stock	1
Section 1.2	Purchase Price and Closing	1
Section 1.3	Delivery	1
Section 1.4	Reservation of Warrant Shares	2

ARTICLE II	Representations and Warranties	2

Section 2.1	Representations and Warranties of the Company	2
Section 2.2	Representations and Warranties of the Purchasers	7

ARTICLE III	Covenants	9

Section 3.1	Public Disclosure	9
Section 3.2	Fees and Expenses	9
Section 3.3	Further Assurances	9
Section 3.4	Additional Listing Application	10
Section 3.5	Legal Opinion	10

ARTICLE IV	Conditions	10

Section 4.1	Conditions Precedent to the Obligations of each Party to Close and Purchase or Sell the Shares	10
Section 4.2	Conditions Precedent to the Obligation of the Purchasers to Close and to Purchase the Shares	10
Section 4.3	Conditions Precedent to the Obligation of the Company to Close and to Sell the Shares	10

ARTICLE V	Certificate Legend	11

Section 5.1	Legend	11

ARTICLE VI	Termination	12

Section 6.1	Termination	12
Section 6.2	Effect of Termination	12

ARTICLE VII	Miscellaneous	12

Section 7.1	Governing Law; Jurisdiction	12
Section 7.2	Entire Agreement; Amendment	12
Section 7.3	Notices, etc.	12
Section 7.4	Delays or Omissions	13

Section 7.5	Titles; Subtitles	14
Section 7.6	Successors and Assigns	14
Section 7.7	No Third Party Beneficiaries	14
Section 7.8	Survival	14
Section 7.9	Counterparts	14
Section 7.10	Severability	14
Section 7.11	SPECIFIC PERFORMANCE	14
Section 7.12	Consents	14
Section 7.13	Construction of Agreement	15
Section 7.14	Variations of Pronouns	15

PURCHASE AGREEMENT

This PURCHASE AGREEMENT (this “Agreement”) is entered into as of January 13, 2009, by and among Nuance Communications, Inc., a Delaware corporation (the “Company”), and the purchasers identified on Exhibit A hereto (the “Purchasers”), for the purchase and sale by the Purchasers of shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”).

The parties hereto agree as follows:

ARTICLE I

Purchase and Sale of Common Stock

Section 1.1 Purchase and Sale of Common Stock. Upon the following terms and conditions, the Company shall issue and sell to the Purchasers, and the Purchasers shall, severally and not jointly, purchase from the Company: (a) an aggregate of 17,395,626 shares of Common Stock (collectively, the “Shares”) in the amounts set forth opposite their respective names on Exhibit A, at a price per Share equal to $10.06, and for an aggregate purchase price of $174,999,997.56 (the “Share Purchase Price”); and (b) warrants (the “Warrants”) to purchase an aggregate of 3,862,422 shares of Common Stock (the “Warrant Shares”) with an exercise price of $11.57 per share in the amounts set forth opposite their respective names on Exhibit A, and for an aggregate purchase price of $241,401.38 (the “Warrant Purchase Price” and together with the Share Purchase Price, the “Purchase Price”). The Company and the Purchasers are executing and delivering this Agreement in accordance with and in reliance upon the exemption from securities registration afforded by Section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”), and the rules and regulations promulgated thereunder, including Regulation D (“Regulation D”), and/or upon such other exemption from the registration requirements of the Securities Act as may be available with respect to any or all of the investments to be made hereunder.

Section 1.2 Purchase Price and Closing. The Company agrees to issue and sell to the Purchasers and, in consideration of and in express reliance upon the representations, warranties, covenants, terms and conditions of this Agreement, the Purchasers agree, severally and not jointly, to purchase the Shares. The closing of the purchase and sale of the Shares (the “Closing”) shall take place at the offices of the Company located at 1 Wayside Road, Burlington, Massachusetts, as soon as practicable following the satisfaction or waiver of the conditions set forth in Article IV, or at such other time and place or on such date as the Purchasers and the Company may agree upon (such date is hereinafter referred to as the “Closing Date”). At the Closing, the entire Purchase Price shall be paid by the Purchasers in cash, by wire transfer of immediately available funds, to an account designated in writing by the Company against the issuance by the Company of the Shares and Warrants.

Section 1.3 Delivery. At the Closing or as promptly thereafter as is practicable (but in no event more than five (5) Business Days after the Closing Date or two (2) Business Days after the Closing Date in the case of the Warrants), the Company shall deliver to the Purchasers (a) certificates representing the portion of the Shares purchased by such Purchaser (it being

understood that the Purchasers shall be record holders of the Shares on the Closing Date), and (b) one or more warrants in substantially the form attached hereto as Exhibit B to acquire an aggregate of 3,862,422 shares of Common Stock. For purposes hereof, the term “Business Day” shall mean a day other than Saturday, Sunday or a federal holiday in which the New York Stock Exchange is closed for trading.

Section 1.4 Reservation of Warrant Shares. The Company has authorized and has reserved and covenants to continue to reserve a number of its authorized but unissued shares of Common Stock equal to the aggregate number of shares of Common Stock necessary to permit the exercise of the Warrants, so long as the Warrants are outstanding. Any shares of Common Stock issuable upon exercise of the Warrants (and such shares when issued) are herein referred to as the “Warrant Shares”. The Shares, the Warrants and the Warrant Shares are sometimes collectively, individually, or in some combination thereof, referred to herein as the “Securities”.

ARTICLE II

Representations and Warranties

Section 2.1 Representations and Warranties of the Company. The Company hereby represents and warrants to the Purchasers as follows:

(a) Organization; Standing and Power. The Company and each of its Subsidiaries (i) is a corporation or other organization duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, (ii) has the requisite power and authority to own, lease and operate its properties and to carry on its business as now being conducted and (iii) is duly qualified or licensed and in good standing to do business in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification or licensing necessary, other than in such jurisdictions where the failure to so qualify or to be in good standing, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Change to the Company. For purposes of this Agreement, “Subsidiary,” when used with respect to any party, shall mean any corporation or other organization, whether incorporated or unincorporated, at least a majority of the securities or other interests of which having by their terms ordinary voting power to elect a majority of the Board of Directors or others performing similar functions with respect to such corporation or other organization is directly or indirectly owned or controlled by such party or by any one or more of its Subsidiaries, or by such party and one or more of its Subsidiaries. For purposes of this Agreement, the term “Material Adverse Change” when used in connection with an entity, means any change, event, violation, inaccuracy, circumstance or effect (any such item, an “Effect”), individually or when taken together with all other Effects that have occurred prior to the date of determination of the occurrence of the Material Adverse Change, that (i) is or is reasonably likely to be materially adverse to the business, assets (including intangible assets), capitalization, financial condition or results of operations of such entity taken as a whole with its subsidiaries or (ii) will or is reasonably likely to materially impede the ability of such entity to timely consummate the transactions contemplated by the Transaction Documents in accordance with the terms thereof and applicable legal requirements.

(b) Charter Documents. The Company is not in violation of any of the provisions of the Company Charter Documents and each Significant Subsidiary of the Company is not in violation of its respective Subsidiary Charter Documents. For purposes of this Agreement, the term: (i) “Company Charter Documents” shall mean (A) a true and correct copy of the Certificate of Incorporation (including any Certificate of Designations) and Bylaws of the Company, each as amended to date; (ii) “Significant Subsidiary” shall have the meaning provided by Rule 1-02 of Regulation S-X of the Commission; (iii) “Subsidiary Charter Documents” shall mean the certificate of incorporation and bylaws, or like organizational documents of a Subsidiary; and (iv) “Commission” shall mean the Securities and Exchange Commission.

(c) Subsidiaries. Exhibit 21.1 to the Company’s Report on Form 10-K for the period beginning October 1, 2007 and ending September 30, 2008 includes all the Subsidiaries of the Company, other than Philips Speech Recognition Systems GmbH, which are Significant Subsidiaries. All the outstanding shares of capital stock of, or other equity or voting interests in, each such Significant Subsidiary have been validly issued and are fully paid and nonassessable and are owned by the Company, a wholly-owned Subsidiary of the Company, or the Company and another wholly-owned Subsidiary of the Company, free and clear of all Liens (except for any Liens created by the Amended and Restated Credit Agreement, dated as of April 5, 2007, by and among the Company and the parties thereto), including any restriction on the right to vote, sell or otherwise dispose of such capital stock or other ownership interests, except for restrictions imposed by applicable securities laws, except as would not reasonably be expected to have a Material Adverse Change to the Company or a Material Adverse Change to such Subsidiary. Other than the Subsidiaries of the Company, neither the Company nor any of its Subsidiaries owns any capital stock of, or other equity or voting interests of any nature in, or any interest convertible, exchangeable or exercisable for, capital stock of, or other equity or voting interests of any nature in, any other person, other than 1,000 shares of Zi Corporation. For purposes of this Agreement, the term “Lien” shall mean pledges, claims, liens, charges, encumbrances, options and security interests of any kind or nature whatsoever.

(d) Capital Stock. The authorized capital stock of the Company consists of: (i) 560,000,000 shares of Common Stock and (ii) 40,000,000 shares of preferred stock, par value $0.001 per share, of which 15,000,000 shares have been designated as Series B Preferred Stock (the “Series B Preferred Stock”). At the close of business on December 2, 2008: (i) 240,969,153 shares of Common Stock were issued and outstanding, excluding shares of Common Stock held by the Company in its treasury, (ii) 3,224,162 shares of Common Stock were issued and held by the Company in its treasury, and (iii) 3,562,238 shares of Series B Preferred Stock were issued and outstanding, and since December 2, 2008 there have been no material changes in the information provided pursuant to clauses (i) through (iii). No shares of Common Stock are owned or held by any Subsidiary of the Company. Each share of capital stock of the Company which may be issued as contemplated or permitted by the Transaction Documents will be, when issued, duly authorized and validly issued, fully paid and nonassessable and not subject to any preemptive rights, free and clear of all Liens.

(e) Stock Options. As of the close of business on December 2, 2008: (i) not more than 15,835,808 shares of Common Stock are subject to issuance pursuant to outstanding options and 9,350,743 shares of Common Stock are subject to issuance pursuant to vesting of

outstanding restricted stock units to purchase Common Stock (“Company Options”) under the stock option, stock award, stock appreciation or phantom stock plans of the Company (the “Stock Option Plans”), and (ii) 2,285,915 shares of Common Stock are reserved for future issuance under the Stock Option Plans, of which 397,300 of the 2,285,915 may only be issued as options. As of the same date, 2,718,932 shares of Common Stock are reserved for future issuance under the Employee Stock Purchase Plans. Included in the issued and outstanding Common Stock of the Company are 625,000 shares that are subject to outstanding restricted stock agreements with certain employees of the Company. All shares of the Common Stock subject to issuance under the Company Options, upon issuance in accordance with the terms and conditions specified in the instruments pursuant to which they are issuable, would be duly authorized, validly issued, fully paid and nonassessable. There are no commitments or agreements of any character to which the Company is bound obligating the Company to accelerate the vesting of any Company Option as a result of the transactions contemplated hereby (whether alone or upon the occurrence of any additional or subsequent events). There are no outstanding or authorized stock appreciation, phantom stock, profit participation or other similar rights with respect to the Company.

(f) Voting Debt. Except for the Company’s 2.75% Senior Convertible Debentures due 2027, no Voting Debt of the Company is issued or outstanding as of the date hereof. For purposes of this Agreement, the term “Voting Debt” shall mean any bonds, debentures, notes or other indebtedness of the Company or any of its Subsidiaries (i) having the right to vote on any matters on which stockholders may vote (or which is convertible into, or exchangeable for, securities having such right) or (ii) the value of which is any way based upon or derived from capital or voting stock of the Company.

(g) Other Securities. Except as otherwise disclosed in the SEC Reports filed prior to the date hereof, there are no securities, options, warrants, calls, rights, contracts, commitments, agreements, instruments, arrangements, understandings, obligations or undertakings of any kind to which the Company or any of its Subsidiaries is a party or by which any of them is bound obligating the Company or any of its Subsidiaries to (including on a deferred basis) issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of capital stock, Voting Debt or other voting securities of the Company or any of its Subsidiaries, or obligating the Company or any of its Subsidiaries to issue, grant, extend or enter into any such security, option, warrant, call, right, contract, commitment, agreement, instrument, arrangement, understanding, obligation or undertaking. All outstanding shares of Common Stock, all outstanding Company Options, and all outstanding shares of capital stock of each Subsidiary of the Company have been issued and granted in compliance in all material respects with (i) all applicable securities laws and all other applicable Legal Requirements and (ii) all requirements set forth in applicable material Contracts. For purposes of this Agreement, the term: (A) “Legal Requirements” shall mean any federal, state, local, municipal, foreign or other law, statute, constitution, principle of common law, resolution, ordinance, code, order, edict, decree, rule, regulation, ruling or requirement issued, enacted, adopted, promulgated, implemented or otherwise put into effect by or under the authority of any Governmental Entity; (B) “Contract” shall mean any written, oral or other agreement, contract, subcontract, settlement agreement, lease, binding understanding, instrument, note, option, warranty, purchase order, license, sublicense, insurance policy, benefit plan or legally binding commitment or undertaking of any nature, as in effect as of the date hereof or as may hereinafter be in effect; and

(C) “Governmental Entity” shall mean any supranational, national, state, municipal, local or foreign government, any instrumentality, subdivision, court, administrative agency or commission or other governmental authority or instrumentality, or any quasi-governmental or private body exercising any regulatory, taxing, importing or other governmental or quasi-governmental authority.

(h) Authority. The Company has all requisite corporate power and authority to enter into this Agreement, the Third Amended and Restated Stockholders Agreement in substantially the form attached hereto as Exhibit C (the “Stockholders Agreement”), the Warrants and the other agreements and documents contemplated hereby and thereby which are executed by the Company or to which the Company is a party (all of the foregoing agreements and documents, including this Agreement, are collectively referred to herein as the “Transaction Documents”). The execution and delivery of the Transaction Documents and the consummation of the transactions contemplated thereby have been duly authorized by all necessary corporate action on the part of the Company and no other corporate or other proceedings on the part of the Company is necessary to authorize the execution and delivery of the Transaction Documents or to consummate the transactions contemplated thereby, subject only to: (i) such consents, approvals, orders, authorizations, registrations, declarations and filings as may be required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”) and any foreign antitrust laws, and (ii) such consents, approvals, orders, authorizations, registrations, declarations and filings as may be required under applicable federal, foreign and state securities (or related) laws and the rules and regulations of the Nasdaq Global Market (clauses (i) - (ii), the “Necessary Consents”). The Transaction Documents have been, or will be upon the Closing, duly executed and delivered by the Company (other than the Warrants, which will be delivered within two (2) Business Days of the Closing) and, assuming due execution and delivery by the other parties hereto, constitutes the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as such enforceability may be subject to the laws of general application relating to bankruptcy, insolvency, and the relief of debtors and rules of law governing specific performance, injunctive relief or other equitable remedies. The issuance of the Shares has been duly authorized by the Company and, when issued and paid for in accordance with the terms of this Agreement, the Shares will be validly issued, fully paid and nonassessable. The Warrant Shares have been duly authorized by the Company and reserved and, when issued upon exercise of the Warrants in accordance with the terms of the Warrants, will be validly issued, fully paid and nonassessable.

(i) Non-Contravention. The execution and delivery of the Transaction Documents by the Company does not, and performance of the Transaction Documents by the Company and the consummation of the transactions contemplated thereby will not: (i) conflict with or violate the Company Charter Documents or any Subsidiary Charter Documents of any Subsidiary of the Company, (ii) subject to compliance with the requirements set forth in Section 2.1(h), conflict with or violate any material Legal Requirement applicable to the Company or any of the Company’s Subsidiaries or by which the Company or any of the Company’s Subsidiaries or any of their respective properties is bound or affected, (iii) result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or materially impair the Company’s rights or alter the rights or obligations of any third party under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the properties or assets of the Company or any of its

Subsidiaries pursuant to, any material Contract of the Company, or (iv) trigger anti-dilution rights or other rights to acquire additional equity securities of the Company.

(j) Necessary Consents. No consent, approval, order or authorization of, or registration, declaration or filing with any Governmental Entity or any other person is required to be obtained or made by the Company in connection with the execution and delivery of the Transaction Documents or the consummation of the transactions contemplated thereby, except for (i) certain of the Necessary Consents and (ii) such other consents, authorizations, filings, approvals and registrations which if not obtained or made would not be material to the Company or materially adversely affect the ability of the parties hereto to consummate the transactions contemplated hereby.

(k) Commission Filings. The Company has filed all required registration statements, prospectuses, reports, schedules, forms, statements and other documents (including exhibits and all other information incorporated by reference) required to be filed by it with the Commission since January 1, 2005. All such required registration statements, prospectuses, reports, schedules, forms, statements and other documents (including those that the Company may file subsequent to the date hereof) are referred to herein as the “SEC Reports.” As of their respective dates, the SEC Reports (i) were prepared in accordance and complied in all material respects with the requirements of the Securities Act, or the Exchange Act, as the case may be, and the rules and regulations of the Commission thereunder applicable to such SEC Reports and (ii) did not at the time they were filed (or if amended or superseded by a filing prior to the date of this Agreement then on the date of such filing) contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(l) Financial Statements. Each of the consolidated financial statements (including, in each case, any related notes thereto) contained in the SEC Reports (the “Company Financials”), including each SEC Report filed after the date hereof until the Closing: (i) complied as to form in all material respects with applicable securities laws and regulations thereunder, (ii) was prepared in accordance with GAAP applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto or, in the case of unaudited interim financial statements, as may be permitted by the Commission on Form 10-Q, 8-K or any successor form under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), and (iii) fairly presented in all material respects the consolidated financial position of the Company and its consolidated Subsidiaries as at the respective dates thereof and the consolidated results of the Company’s operations and cash flows for the periods indicated. The balance sheet of the Company contained in the SEC Reports as of September 30, 2008 is hereinafter referred to as the “Company Balance Sheet.”

(m) No Undisclosed Liabilities. Neither the Company nor its Subsidiaries has any liability, indebtedness, obligation, expense, claim, deficiency, guaranty or endorsement of any type, whether accrued, absolute, contingent, matured, unmatured or other (whether or not required to be reflected in the Company Financials), which individually or in the aggregate (i) has not been reflected in the Company Balance Sheet, or (ii) has not arisen in the ordinary course of business consistent with past practices since the Company Balance Sheet.

(n) Absence of Certain Changes or Events. Since the date of the Company Balance Sheet, the Company has conducted its business only in the ordinary course of business consistent with past practice and there has not been: (i) any Material Adverse Change to the Company, (ii) any declaration, setting aside or payment of any dividend on, or other distribution (whether in cash, stock or property) in respect of, any of the Company’s or any of its Subsidiaries’ capital stock, or any purchase, redemption or other acquisition by the Company or any of its Subsidiaries of any of the Company’s capital stock or any other securities of the Company or its Subsidiaries or any options, warrants, calls or rights to acquire any such shares or other securities except for repurchases from employees following their termination pursuant to the terms of their pre-existing stock option or purchase agreements, (iii) any split, combination or reclassification of any of the Company’s or any of its Subsidiaries’ capital stock, (iv) entry by the Company or any of its Subsidiaries into any licensing or other agreement with regard to the disposition of any material intellectual property other than licenses, distribution agreements, advertising agreements, sponsorship agreements or merchant program agreements entered into in the ordinary course of business consistent with past practice, (v) any material change by the Company in its accounting methods, principles or practices, except as required by concurrent changes in GAAP or by the Commission, (vi) any material revaluation by the Company of any of its assets, including, without limitation, writing down the value of capitalized inventory or writing off notes or accounts receivable other than in the ordinary course of business consistent with past practice, (vii) any communication from the Nasdaq Global Market with respect to the delisting of the Common Stock, (viii) any cancellation by the Company or any of its Subsidiaries of any debts or waiver of any claims or rights of material value, (ix) any sale, transfer or other disposition outside of the ordinary course of business of any properties or assets (real, personal or mixed, tangible or intangible) by the Company or any of its Subsidiaries, or (x) any agreement, whether in writing or otherwise, to take any action described in this section by the Company or any of its Subsidiaries.

(o) Section 203; Rights Agreement. The Board of Directors of the Company has heretofore taken all necessary action to approve, and has approved, for purposes of Section 203 of the Delaware General Corporation Law (including any successor statute thereto “Section 203”) the Purchasers’ becoming, together with their affiliates and associates, an “interested stockholder” within the meaning of Section 203, such that, as of the date hereof and from and after the Closing, Section 203 will not be applicable to any “business combination” within the meaning of Section 203 that may take place between one or more of the Purchasers and/or their respective affiliates and associates, on the one hand, and the Company, on the other, as a result of the transactions contemplated by this Agreement or otherwise. The Company does not have a rights agreement, poison pill or similar arrangement in place.

Section 2.2 Representations and Warranties of the Purchasers. Each of the Purchasers hereby makes the following representations and warranties to the Company with respect solely to itself and not with respect to any other Purchasers:

(a) Organization and Standing of the Purchasers. If such Purchaser is an entity, such Purchaser is a corporation, limited liability company or partnership duly incorporated or organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization.

(b) Authorization and Power. Such Purchaser has the requisite power and authority to enter into and perform the Transaction Documents and to purchase the Shares being sold to it hereunder, subject only to such consents, approvals, orders, authorizations, registrations, declarations and filings as may be required under the HSR Act and any foreign antitrust laws. The execution, delivery and performance of the Transaction Documents by such Purchasers and the consummation by it of the transactions contemplated thereby have been duly authorized by all necessary corporate or other action, and no further consent or authorization of such Purchasers or its Board of Directors, stockholders, or partners, as the case may be, is required. The Transaction Documents constitute, or shall constitute when executed and delivered, valid and binding obligations of such Purchaser enforceable against such Purchaser in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation, conservatorship, receivership or similar laws relating to, or affecting generally the enforcement of creditor’s rights and remedies or by other equitable principles of general application.

(c) Acquisition for Investment. Such Purchaser is acquiring the Securities solely for its own account and not with a view to or for sale in connection with the distribution thereof. Such Purchaser does not have a present intention to sell any of the Securities, nor a present arrangement (whether or not legally binding) or intention to effect any distribution of any of the Securities to or through any person or entity. Such Purchaser acknowledges that it (i) has such knowledge and experience in financial and business matters such that such Purchaser is capable of evaluating the merits and risks of its investment in the Company, (ii) is able to bear the financial risks associated with an investment in the Securities, and (iii) has been given full access to such records of the Company and the Subsidiaries and to the officers of the Company as it has deemed necessary or appropriate to conduct its due diligence investigation.

(d) Restricted Securities. Such Purchaser understands that the Securities have not been, and will not be, registered under the Securities Act, by reason of a specific exemption from the registration provisions of the Securities Act which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of such Purchaser’s representations as expressed herein. Such Purchaser understands that the Securities are “restricted securities” under applicable U.S. federal and state securities laws and that, pursuant to these laws, such Purchaser must hold the Securities indefinitely unless they are registered with the Commission and qualified by state authorities, or an exemption from such registration and qualification requirements is available. Such Purchaser further acknowledges that if an exemption from registration or qualification is available, it may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding period for the Securities, and on requirements relating to the Company which are outside of such Purchaser’s control, and which the Company is under no obligation and may not be able to satisfy. Such Purchaser understands that no United States federal or state agency or any government or governmental agency has passed upon or made any recommendation or endorsement of the Securities.

(e) No General Solicitation. Such Purchaser acknowledges that the Securities were not offered to such Purchaser by means of any form of general or public solicitation or general advertising, or publicly disseminated advertisements or sales literature, including (i) any advertisement, article, notice or other communication published in any newspaper, magazine, or

similar media, or broadcast over television or radio, or (ii) any seminar or meeting to which such Purchaser was invited by any of the foregoing means of communications.

(f) Equity Owned. Excluding the Shares and Warrants to be issued pursuant to this Agreement, as of the date hereof the Purchasers do not own of record any shares of the Company’s Common Stock. As of the date hereof, investment funds affiliated with the Purchasers own of record an aggregate of 37,408,650 shares of the Company’s Common Stock, 3,562,238 shares of the Company’s Series B Preferred Stock and warrants to acquire an aggregate of 10,766,538 shares of the Company’s Common Stock. Except as set forth above, as of the date hereof, the Purchasers do not beneficially own (in accordance with Rule 13d-3 of the Securities Exchange Act of 1934, as amended) any other shares of the Company’s Common Stock (other than Company Common Stock underlying Company Options issued to William Janeway or Jeffrey Harris that are either currently exercisable or exercisable within 60 days of the date of this Agreement).

(g) Accredited Investor. Such Purchaser is an accredited investor as defined in Rule 501(a) of Regulation D promulgated under the Act.

ARTICLE III

Covenants

Section 3.1 Public Disclosure. The parties shall consult with each other, and to the extent practicable, agree, before issuing any press release or otherwise making any public statement with respect to the transactions contemplated by the Transaction Documents other than as may be required in any filing with the Commission or the Company’s listing agreement with the Nasdaq Global Market, as advised by counsel to the Company.

Section 3.2 Fees and Expenses. Following the Closing, the Company shall promptly pay the fees and reasonable out-of-pocket expenses of the Purchasers’ advisors and legal counsel incurred in connection with the negotiation, preparation, execution, delivery and performance of this Agreement, including fees and reasonable out-of-pocket expenses relating to any filings under the HSR Act, upon receipt of an invoice for such. The Company shall promptly pay the fees and reasonable out-of-pocket expenses of the Purchasers’ advisors and legal counsel incurred in connection with the negotiation, preparation, execution, delivery and performance of this Agreement in the event the Closing does not occur prior to the date set forth in Section 6.1 upon receipt of an invoice for such; provided, however, that the right to payment of such fees and expenses shall not be available to the Purchasers’ or any of them, if the action or failure to act by a Purchaser has been a principal cause of or resulted in the failure of the Closing to occur on or before such date, and such action or failure to act constitutes a breach of this Agreement.

Section 3.3 Further Assurances. From and after the date of this Agreement, upon the request of the Purchasers or the Company, the Company and each Purchaser shall execute and deliver such instruments, documents and other writings as may be reasonably necessary or desirable to confirm and carry out and to effectuate fully the intent and purposes of this Agreement. The Company agrees to use its commercially reasonable efforts to take or cause to be taken all action and to do or cause to be done all things necessary, proper or advisable under

applicable laws and regulations to consummate and make effective the transactions contemplated by the Transaction Documents, subject to the terms and conditions hereof and thereof, including all actions and things necessary to cause all conditions set forth in Article IV to be satisfied.

Section 3.4 Additional Listing Application. To the extent required by the rules of the Nasdaq Global Market or the Company’s listing agreement with the Nasdaq Global Market, the Company will file a notification form for the listing of additional shares in connection with the transactions contemplated hereby.

Section 3.5 Legal Opinion. At the Closing, the Company shall cause its outside legal counsel to deliver an opinion to the Purchasers in substantially the form attached hereto as Exhibit D.

ARTICLE IV

Conditions

Section 4.1 Conditions Precedent to the Obligations of each Party to Close and Purchase or Sell the Shares. The respective obligations of any party to this Agreement to proceed with the Closing shall be subject to the satisfaction at or prior to the Closing Date of the following conditions:

(a) No Injunction. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, or promulgated by any court or governmental authority of competent jurisdiction which prohibits the consummation of any of the transactions contemplated by the Transaction Documents.

(b) Governmental Approvals. All applicable waiting periods under the HSR Act and under any applicable material foreign or other antitrust laws shall have expired or been terminated.

Section 4.2 Conditions Precedent to the Obligation of the Purchasers to Close and to Purchase the Shares. The obligations of the Purchasers to purchase the Shares from the Company at the Closing shall be subject to the satisfaction at or prior to the Closing Date of each of the following conditions, any of which may be waived, in writing, exclusively by the Purchasers:

(a) Delivery of Transaction Documents. The other Transaction Documents to which the Company is a party (other than the Warrants, which will be delivered within two (2) Business Days of the Closing Date) shall have been duly executed and delivered by the Company to the Purchasers.

Section 4.3 Conditions Precedent to the Obligation of the Company to Close and to Sell the Shares. The obligation of the Company to sell the Shares to the Purchasers shall be subject to the satisfaction at or prior to the Closing Date of each of the following conditions, any of which may be waived, in writing, exclusively by the Company:

(a) Delivery of Transaction Documents. The other Transaction Documents to which the Purchasers are party shall have been duly executed and delivered by the Purchasers to the Company.

ARTICLE V

Certificate Legend

Section 5.1 Legend.

(a) Each certificate representing the Shares and the Warrant Shares shall be stamped or otherwise imprinted with a legend substantially in the following form (in addition to any legend required by applicable state securities or “blue sky” laws) until such legend may be removed as provided in subsection (b) below:

“THE SHARES OF COMMON STOCK REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR IF APPLICABLE, STATE SECURITIES LAWS. THESE SHARES OF COMMON STOCK MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SHARES OF COMMON STOCK UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO NUANCE COMMUNICATIONS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.”

(b) The Company agrees to reissue certificates representing any of the Shares or Warrant Shares, without the legend set forth above, if at such time, prior to making any transfer of any such Securities, such holder thereof shall give written notice to the Company describing the manner and terms of such transfer and removal as the Company may reasonably request; provided that such legends shall not be removed and such proposed transfer will not be effected until: (i) such shares of Common Stock are registered under the Securities Act; or (ii) such holder provides the Company with an opinion of counsel acceptable to the Company to the effect that a public sale, assignment or transfer of the shares of Common Stock may be made without registration under the Securities Act and applicable state securities or “blue sky” laws. In the case of any proposed transfer under this Section 5.1, the Company shall in no event be required, in connection therewith, to qualify to do business in any state where it is not then qualified or to take any action that would subject it to tax or to general service of process in any state where it is not then subject. The restrictions on transfer contained in this Section 5.1 shall be in addition to, and not by way of limitation of, any other restrictions on transfer contained in any other section of this Agreement.

ARTICLE VI

Termination

Section 6.1 Termination. This Agreement may be terminated at any time prior to the Closing Date by (a) the mutual written consent of the Company and the Purchasers, or (b) any party if the Closing Date has not occurred by July 14, 2009; provided, however, that the right to terminate pursuant to this Section 6.1 shall not be available to any party whose action or failure to act has been a principal cause of or resulted in the failure of the Closing to occur on or before such date, and such action or failure to act constitutes a breach of this Agreement.

Section 6.2 Effect of Termination. In the event of a termination by the Company or the Purchasers, written notice thereof shall forthwith be given to the other party and the transactions contemplated by this Agreement shall be terminated without further action by any party. If this Agreement is terminated as provided in Section 6.1 herein, this Agreement shall become void and of no further force or effect, except for Section 3.2, this Section 6.2 and Article VII herein, which shall survive the termination of this Agreement. Nothing in this Section 6.2 shall be deemed to release the Company or any Purchaser from any liability for any breach of this Agreement, or to impair the rights of the Company or such Purchaser to compel specific performance by the other of its obligations under this Agreement.

ARTICLE VII

Miscellaneous

Section 7.1 Governing Law; Jurisdiction. This Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of Delaware without giving effect to the principles of conflicts of laws. Any legal action or other legal proceeding relating to this Agreement or the enforcement of any provision of this Agreement may be brought or otherwise commenced in any state or federal court located in the State of Delaware. Each party hereto agrees to the entry of an order to enforce any resolution, settlement, order or award made pursuant to this Section 7.1 by the state and federal courts located in the State of Delaware and in connection therewith hereby waives, and agrees not to assert by way of motion, as a defense, or otherwise, any claim that such resolution, settlement, order or award is inconsistent with or violative of the laws or public policy of the laws of the State of Delaware or any other jurisdiction.

Section 7.2 Entire Agreement; Amendment. This Agreement and the other Transaction Documents constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof. Any previous agreements among the parties relative to the specific subject matter hereof are superseded by this Agreement. Neither this Agreement nor any provision hereof may be amended, changed, waived, discharged or terminated other than by a written instrument signed by the party against who enforcement of any such amendment, change, waiver, discharge or termination is sought.

Section 7.3 Notices, etc. All notices and other communications required or permitted hereunder shall be effective upon receipt and shall be in writing and may be delivered in person,

by telecopy, electronic mail, express delivery service or U.S. mail, in which event it may be mailed by first-class, certified or registered, postage prepaid, addressed, to the party to be notified, at the respective addresses set forth below, or at such other address which may hereinafter be designated in writing:

(a)	If to the Purchasers, to:

	Warburg Pincus Private Equity X, L.P.
	Warburg Pincus X Partners, L.P.
	c/o Warburg Pincus LLC
	466 Lexington Avenue
	New York, NY 10017
	Attention: Jeffrey A. Harris
	Fax No.: 212-878-6139

	with a copy to:

	Willkie Farr & Gallagher LLP
	787 Seventh Avenue
	New York, NY 10019
	Attention:	Steven J. Gartner, Esq.
		Robert T. Langdon, Esq.
	Fax No.: 212-728-8111

(b)	If to the Company, to:

	Nuance Communications, Inc.
	1 Wayside Road
	Burlington, MA 01803
	Attention: Chief Executive Officer
	General Counsel
	Phone: 781-565-5000
	Fax No.: 781-565-5001

	with a copy to:

	Wilson Sonsini Goodrich & Rosati
	1700 K Street, NW
	Fifth Floor
	Washington, DC 20006
	Attention: Robert D. Sanchez, Esq.
	Fax No.: 202-973-8899

Section 7.4 Delays or Omissions. It is agreed that no delay or omission to exercise any right, power or remedy accruing to any party upon any breach or default of any other party under this Agreement shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach or default, or any acquiescence therein, or of any similar breach

or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character of any breach or default under this Agreement, or any waiver of any provisions or conditions of this Agreement must be in writing and shall be effective only to the extent specifically set forth in writing, and that all remedies, either under this Agreement, by law or otherwise, shall be cumulative and not alternative.

Section 7.5 Titles; Subtitles. The titles of the Articles and Sections of this Agreement are for convenience of reference only and in no way define, limit, extend, or describe the scope of this Agreement or the intent of any of its provisions.

Section 7.6 Successors and Assigns. Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors and assigns of the parties hereto.

Section 7.7 No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other person.

Section 7.8 Survival. The representations and warranties of the Company and the Purchasers contained herein shall not survive the Closing.

Section 7.9 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

Section 7.10 Severability. If any provision of this Agreement shall be judicially determined to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

Section 7.11 SPECIFIC PERFORMANCE. THE PARTIES HERETO AGREE THAT IRREPARABLE DAMAGE WOULD OCCUR IN THE EVENT THAT ANY OF THE PROVISIONS OF THIS AGREEMENT WERE NOT PERFORMED IN ACCORDANCE WITH ITS SPECIFIC INTENT OR WERE OTHERWISE BREACHED. IT IS ACCORDINGLY AGREED THAT THE PARTIES SHALL BE ENTITLED TO AN INJUNCTION OR INJUNCTIONS, WITHOUT BOND, TO PREVENT OR CURE BREACHES OF THE PROVISIONS OF THIS AGREEMENT AND TO ENFORCE SPECIFICALLY THE TERMS AND PROVISIONS HEREOF, THIS BEING IN ADDITION TO ANY OTHER REMEDY TO WHICH THEY MAY BE ENTITLED BY LAW OR EQUITY, AND ANY PARTY SUED FOR BREACH OF THIS AGREEMENT EXPRESSLY WAIVES ANY DEFENSE THAT A REMEDY IN DAMAGES WOULD BE ADEQUATE.

Section 7.12 Consents. Any permission, consent, or approval of any kind or character under this Agreement shall be in writing and shall be effective only to the extent specifically set forth in such writing.

Section 7.13 Construction of Agreement. No provision of this Agreement shall be construed against either party as the drafter thereof.

Section 7.14 Variations of Pronouns. All pronouns and all variations thereof shall be deemed to refer to the masculine, feminine, or neuter, singular or plural, as the context in which they are used may require.

[Remainder of page intentionally left blank. Signature pages to follow]

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

	NUANCE COMMUNICATIONS, INC.


	By:	/s/ Tom Beaudoin
		Name: Tom Beaudoin
		Title: Chief Financial Officer

	WARBURG PINCUS PRIVATE EQUITY X, L.P.

	By:	Warburg Pincus X L.P.,
		its General Partner

	By:	Warburg Pincus X LLC,
		its General Partner

	By:	Warburg Pincus Partners, LLC,
		its Managing Member

	By:	Warburg Pincus & Co.,
		its Managing Member

	By:	/s/ Patrick Severson
		Name: Patrick Severson
		Title: Partner

	WARBURG PINCUS X PARTNERS, L.P.

	By:	Warburg Pincus X L.P.,
		its General Partner

	By:	Warburg Pincus X LLC,
		its General Partner

	By:	Warburg Pincus Partners, LLC,
		its Managing Member

	By:	Warburg Pincus & Co.,
		its Managing Member

	By:	/s/ Patrick Severson
		Name: Patrick Severson
		Title: Partner

[Signature Page to Purchase Agreement]

EXHIBIT A

SCHEDULE OF PURCHASERS

Name	Shares of Common Stock Purchased	Aggregate Purchase Price for Common Stock		Warrant Shares Acquired	Aggregate Purchase Price for Warrants

Warburg Pincus Private Equity X, L.P.	16,856,362	$	169,575,001.72	3,742,687	$	233,917.94

Warburg Pincus X Partners, L.P.	539,264	$	5,424,995.84	119,735	$	7,483.44

Total:	17,395,626	$	174,999,997.56	3,862,422	$	241,401.38

EXHIBIT B

FORM OF WARRANT

EXHIBIT C

THIRD AMENDED AND RESTATED STOCKHOLDERS AGREEMENT

EXHIBIT D

FORM OF WSGR OPINION

EX-99.2 3 a09-3214_1ex99d2.htm EX-99.2

EXHIBIT 99.2

THIS WARRANT AND THE WARRANT SHARES HAVE NOT BEEN REGISTERED

UNDER THE SECURITIES ACT OF 1933, AS

AMENDED, NOR REGISTERED OR QUALIFIED UNDER ANY STATE

SECURITIES LAWS, AND MAY NOT BE PLEDGED, HYPOTHECATED,

SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS SO

REGISTERED OR AN EXEMPTION THEREFROM IS AVAILABLE

WARRANT TO PURCHASE COMMON STOCK

OF NUANCE COMMUNICATIONS, INC.

Date of Issuance: [·], 2009

In consideration for the payment by to Nuance Communications, Inc., a Delaware corporation (the “Company”), of $[·] in cash, by certified check, or by wire transfer (the “Purchase Price”), the Company agrees to the provisions set forth herein. The Company certifies that and its permitted assigns (the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company, up to [·] fully-paid and nonassessable shares of Common Stock (the “Warrant Shares”) at a purchase price per share equal to the Warrant Price (defined below). The number of shares of Common Stock purchasable upon exercise of this Warrant and the Warrant Price shall be subject to adjustment from time to time as provided herein. The initial Warrant Price (the “Warrant Price”) per share of Common Stock shall equal $11.57.

This Warrant is one in a series of warrants issued on [·], 2009 (the “Issuance Date”) with substantially similar terms and conditions that (x) as of the Issuance Date and subject to the provisions of this Warrant and such other warrants (as applicable), allow for the purchase of up to an aggregate of [·] shares of Common Stock and (y) as of the Issuance Date, are represented by warrant certificate numbers [W-·], [W-·], and [W-·]. Such warrants and any warrants issued upon assignment or replacement thereof are referred to herein as the “Warrants,” and the holders thereof and their permitted assigns are referred to herein as the “Holders.”

For the purpose of this Warrant, the term “Common Stock” shall mean (i) the Common Stock, par value $0.001 per share, of the Company as of the Issuance Date, or (ii) any other class or classes of stock resulting from successive changes or reclassifications of such class of stock, and the term “Business Day” shall mean any day other than a Saturday or Sunday or a day on which commercial banks in New York, New York are required or authorized to be closed.

Section 1. Term of Warrant, Exercise of Warrant. (a) Subject to the terms of this Warrant, the Holder shall have the right, at its option, which may be exercised in whole or in part, at any time, and from time to time, commencing at the time immediately following the time the Purchase Price has been paid and until the earlier of (x) 5:00 p.m. Eastern Time on the four year anniversary of the Issuance Date and (y) the closing of a Change of Control (as defined below) (the “Warrant Expiration Date”) to purchase from the Company the Warrant Shares. “Change of Control” shall mean the sale, conveyance or disposal of all or substantially all of the

Company’s property or business or the Company’s merger with or into or consolidation with any other corporation (other than a wholly-owned subsidiary of the Company) or any other transaction or series of related transactions in which the stockholders of the Company immediately prior to the transaction or transactions own less than a majority of the voting power of the surviving corporation following the transaction or transactions.

(b) The purchase rights evidenced by this Warrant shall be exercised by the Holder surrendering this Warrant, with the form of subscription at the end hereof duly executed by the Holder, to the Company at its office in Burlington, Massachusetts (or, in the event the Company’s principal office is no longer in Burlington, Massachusetts its then principal office in the United States (the “Principal Office”)), accompanied by payment, of an amount (the “Exercise Payment”) equal to the Warrant Price multiplied by the number of Warrant Shares being purchased pursuant to such exercise, payable as follows: (i) by payment to the Company in cash, by certified check, or by wire transfer of the Exercise Payment, (ii) by surrender to the Company for cancellation of securities of the Company having a Market Price (as hereinafter defined) on the date of exercise equal to the Exercise Payment; or (iii) by a combination of the methods described in clauses (i) and (ii) above. In lieu of exercising the Warrant as set forth in the foregoing sentence, the Holder may elect to perform a net exercise and receive a payment equal to the difference between (i) the Market Price on the date of exercise multiplied by the number of Warrant Shares as to which the payment is then being elected and (ii) the aggregate Warrant Price with respect to such Warrant Shares, payable by the Company to the Holder only in shares of Common Stock valued at the Market Price on the date of exercise. For purposes hereof, the term “Market Price” shall mean, with respect to any day, the average closing price of a share of Common Stock or other security for the 5 consecutive trading days preceding such day on the principal national securities exchange on which the shares of Common Stock or securities are listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, the average of the reported high and low prices during such 5 trading day period on Nasdaq or, if the shares are not listed on Nasdaq, in the over-the-counter market or, if the shares of Common Stock or securities are not publicly traded, the Market Price for such day shall be the fair market value thereof determined in good faith jointly by the Company and the Holders of a majority in interest of the shares of Common Stock then purchasable pursuant to outstanding Warrants (a “Holder Majority”); provided, however, that if such parties are unable to reach agreement within a reasonable period of time, the Market Price shall be determined in good faith by an independent investment banking firm selected jointly by the Company and a Holder Majority or, if that selection cannot be made within 15 days, by an independent investment banking firm selected by the American Arbitration Association in accordance with its rules. All costs and expenses of such independent investment banking firm shall be borne 50% by the Company and 50% by the Holders, pro rata based on the number of Warrant Shares then held by each.

(c) Upon any exercise of this Warrant, the Company shall issue and cause to be delivered with all reasonable dispatch, but in any event within 10 Business Days, to or upon the written order of the Holder and, subject to Section 3, in such name or names as the Holder may designate (provided that such names other than the Holder may include only affiliates of the Holder), a certificate or certificates for the number of full Warrant Shares issuable upon such exercise together with such other property, including cash (if necessary pursuant to Section 5.3 hereof), which may be deliverable upon such exercise. If fewer than all of the Warrant Shares

represented by this Warrant are purchased, a new Warrant of the same tenor as this Warrant, evidencing the Warrant Shares not purchased will be issued and delivered by the Company at the Company’s expense, to the Holder together with the issue of the certificates representing the Warrant Shares then being purchased. All Warrant certificates surrendered upon exercise of Warrants shall be canceled by the Company.

Section 2. Warrant Register, Registration of Transfers.

Section 2.1. Warrant Register. The Company shall keep at its Principal Office, a register (the “Warrant Register”) in which the Company shall record the name and address of the Holder from time to time and all transfers and exchanges of this Warrant. The Company shall give the Holder prior written notice of any change of the address at which such register is kept.

Section 2.2. Registration of Transfers, Exchanges or Assignment of Warrants. The Holder shall be entitled to assign its interest in this Warrant in whole or in part to any affiliate of Holder upon surrender thereof accompanied by a written instrument or instruments of transfer in the form of assignment at the end hereof duly executed by the Holder. Except as set forth in the preceding sentence, this Warrant may not be assigned by the Holder. This Warrant may also be exchanged or combined with warrants of like tenor at the option of the Holder for another Warrant or Warrants of like tenor and representing in the aggregate the right to purchase a like number of Warrant Shares upon presentation thereof to the Company as its Principal Office together with a written notice signed by the Holder specifying the denominations in which the new Warrant is or the new Warrants are to be issued.

Upon surrender for transfer or exchange of this Warrant to the Company at its Principal Office for transfer or exchange, in accordance with this Section 2, the Company shall, without charge (subject to Section 3), execute and deliver a new Warrant or Warrants of like tenor and of a like aggregate amount of Warrant Shares in the name of the assignee named in such instrument of assignment and, if the Holder’s entire interest is not being assigned, in the name of the Holder with respect to that portion not transferred, and this Warrant shall promptly be canceled.

Notwithstanding the foregoing, the Holder acknowledges that this Warrant and the Warrant Shares have not been registered under the Securities Act of 1933, as amended (the “Act”), and agrees not to sell, pledge, distribute, offer for sale, transfer or otherwise dispose of this Warrant and Warrant Shares in the absence of (i) registration or qualification of this Warrant and such Warrant Shares under any applicable U.S. federal or state securities law then in effect, or (ii) an opinion of counsel, satisfactory to the Company, that such registration and qualification are not required.

Section 3. Payment of Taxes. The Company shall pay all documentary stamp taxes, if any, attributable to the initial issuance of any Warrant Shares upon the exercise of this Warrant; provided, however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issue or delivery of any Warrant or certificate for Warrant Shares in a name other than that of the Holder as such name is then shown on the books of the Company.

Section 4. Certain Covenants.

Section 4.1. Reservation of Warrant Shares. There have been reserved and the Company shall at all times keep reserved, out of its authorized but unissued Common Stock, free from any preemptive rights, rights of first refusal or other restrictions (other than pursuant to the Act and applicable state securities laws) a number of shares of Common Stock sufficient to provide for the exercise of the rights of purchase represented by this Warrant.

Section 4.2. No Impairment. The Company shall not by any action including, without limitation, amending its Restated Certificate of Incorporation, any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but shall at all times in good faith assist in the carrying out of all such terms and in the taking of all such action, as may be necessary or appropriate to protect the rights of the Holder against impairment. Without limiting the generality of the foregoing, the Company shall take all such action as may be necessary or appropriate in order that the Company may validly issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant at the then Warrant Price therefor.

Section 4.3. Notice of Certain Corporate Action. In case the Company shall propose (a) to offer to the holders of its Common Stock rights to subscribe for or to purchase any shares of Common Stock or shares of stock of any class or any other securities, rights or options, or (b) to effect any reclassification of its Common Stock (other than a reclassification involving only the subdivision, or combination, of outstanding shares of Common Stock), or (c) to effect any capital reorganization, or (d) to effect any Change of Control, or (e) to effect the liquidation, dissolution or winding up of the Company or (f) to offer to the holders of its Common Stock the right to have their shares of Common Stock repurchased or redeemed or otherwise acquired by the Company, or (g) to take any other action which would require the adjustment of the Warrant Price and/or the number of Warrant Shares issuable upon exercise of this Warrant, then in each such case (but without limiting the provisions of Section 5), the Company shall give to the Holder, a notice of such proposed action, which shall specify the date on which a record is to be taken for purposes of such dividend, distribution of offer of rights, or the date on which such reclassification, reorganization, Change of Control, liquidation, dissolution, or winding up is to take place and the date of participation therein by the holders of Common Stock, if any such date is to be fixed and shall also set forth such facts with respect thereto as shall be reasonably necessary to indicate the effect of such action on the Common Stock. Such notice shall be so given at least ten (10) Business Days prior to the record date for determining holders of the Common Stock for purposes of participating in or voting on such action, or at least ten (10) Business Days prior to the date of the taking of such proposed action or the date of participation therein by the holders of Common Stock, whichever shall be the earlier. Such notice shall specify, in the case of any subscription or repurchase rights, the date on which the holders of Common Stock shall be entitled thereto, or the date on which the holders of Common Stock shall be entitled to exchange their Common Stock for securities or other property deliverable upon any reorganization, reclassification, Change of Control or other action, as the case may be. Such notice shall also state whether the action in question or the record date is subject to the effectiveness of a registration statement under the Act or to a favorable vote of security holders, if either is required, and the adjustment in Warrant Price and/or number of Warrant Shares

issuable upon exercise of this Warrant as a result of such reorganization, reclassification, Change of Control or other action, to the extent then determinable. No such notice shall be given if the Company reasonably determines that the giving of such notice would require disclosure of material information which the Company has a bona fide purpose for preserving as confidential or the disclosure of which would not be in the best interests of the Company.

Section 4.4. Purchase Entirely for Own Account. The Holder acknowledges that this Warrant is given to the Holder in reliance upon the Holder’s representation to the Company, which by its acceptance of this Warrant the Holder hereby confirms, that the Warrant, the Warrant Shares, and the Common Stock issuable upon conversion of the Warrant Shares (collectively, the “Securities”) being acquired by the Holder are being acquired for investment for the Holder’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Holder has no present intention of selling, granting any participation in, or otherwise distributing the same. By executing this Warrant, the Holder further represents that the Holder does not presently have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participations to such person or to any third person, with respect to any of the Securities. The Holder represents that it has full power and authority to enter into this Warrant. The Holder has not been formed for the specific purpose of acquiring any of the Securities.

Section 4.5. Disclosure of Information. The Holder has had an opportunity to discuss the Company’s business, management, financial affairs and the terms and conditions of the offering of the Securities with the Company’s management and has had an opportunity to review the Company’s facilities, and has had an opportunity to read all of the Company’s filings with the Securities and Exchange Commission.

Section 4.6. Restricted Securities. The Holder understands that the Securities have not been, and will not be, registered under the Act, by reason of a specific exemption from the registration provisions of the Act which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Holder’s representations as expressed herein. The Holder understands that the Securities are “restricted securities” under applicable U.S. federal and state securities laws and that, pursuant to these laws, the Holder must hold the Securities indefinitely unless they are registered with the Securities and Exchange Commission and qualified by state authorities, or an exemption from such registration and qualification requirements is available. The Holder further acknowledges that if an exemption from registration or qualification is available, it may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding period for the Securities, and on requirements relating to the Company which are outside of the Holder’s control, and which the Company is under no obligation and may not be able to satisfy.

Section 4.7. Accredited Investor. The Holder is an accredited investor as defined in Rule 501(a) of Regulation D promulgated under the Act.

Section 5. Adjustment of Warrant Price.

Section 5.1. Subdivision or Combination of Stock. In case the Company shall at any time (i) issue a dividend payable in Common Stock or any rights to subscribe for or to

purchase, or any options for the purchase of, Common Stock or (ii) subdivide its outstanding shares of Common Stock into a greater number of shares or combine its outstanding shares of Common Stock into a smaller number of shares, then (x) in the case of a dividend or subdivision, the Warrant Price in effect immediately prior to such dividend or subdivision shall be proportionately decreased and the number of shares of Common Stock purchasable upon the exercise of the Warrant immediately prior to such adjustment shall be proportionately increased, and (y) in the case of a combination, the Warrant Price in effect immediately prior to such combination shall be proportionately increased and the number of shares of Common Stock purchasable upon the exercise of the Warrant immediately prior to such adjustment shall be proportionately decreased.

Section 5.2. Reorganization, Reclassification, Consolidation, Merger or Sale. If any capital reorganization or reclassification of the capital stock of the Company or any consolidation or merger of the Company with another corporation, other than a Change of Control, shall be effected in such a way that holders of Common Stock shall be entitled to receive stock, securities or assets with respect to or in exchange for Common Stock, then, as a condition of such reorganization, reclassification, consolidation, exercise, merger or sale, lawful and adequate provision shall be made whereby the Holder shall thereafter have the right to receive upon the basis and upon the terms and conditions specified herein and in lieu of the shares of Common Stock immediately theretofore receivable upon the exercise of this Warrant, that number of shares of stock, securities or assets (including cash) as may be issued or payable with respect to or in exchange for a number of outstanding shares of such Common Stock equal to the number of Warrant Shares for which this Warrant could have been exercised immediately prior to such reorganization, reclassification, consolidation, merger or sale, and in any such case appropriate provision shall be made with respect to the rights and interests of such Holder to the end that the provisions hereof shall thereafter be applicable, as nearly as may be, in relation to any shares of stock, securities or assets (including cash) thereafter deliverable upon the exercise of this Warrant. The Company will not effect any such consolidation, merger or sale, unless prior to the consummation thereof the successor corporation (if other than the Company) resulting from such consolidation or merger or the corporation purchasing such assets shall assume, by written instrument executed and mailed or delivered to the Holder at the last address of such Holder appearing on the books of the Company, the obligation to deliver to such Holder such shares of stock, securities or assets (including cash) as, in accordance with the foregoing provisions, the Holder may be entitled to receive.

Section 5.3. Fractional Shares. The Company shall not issue fractions of shares of Common Stock upon exercise of this Warrant or scrip in lieu thereof. If any fraction of a share of Common Stock would, except for the provisions of this Section 5.3, be issuable upon exercise of this Warrant, the Company shall in lieu thereof pay to the person entitled thereto an amount in cash equal to the current value of such fraction, calculated to the nearest one-hundredth (1/100) of a share, to be computed on the basis of the Market Price for a share of Common Stock as of the date of exercise.

Section 5.4. Notice of Adjustment. Upon any adjustment of the Warrant Price, and from time to time upon the request of the Holder, the Company shall furnish to the Holder the Warrant Price resulting from such adjustment or otherwise in effect and the number of

Warrant Shares then available for purchase under this Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based.

Section 5.5. Certain Events. If any event occurs as to which, in the good faith judgment of the Board of Directors of the Company the other provisions of this Section 5 are not strictly applicable or if strictly applicable would not fairly protect the exercise rights of the Holder in accordance with the essential intent and principles of such provisions, then the Board of Directors of the Company in the good faith, reasonable exercise of its business judgment shall make an adjustment in the application of such provisions, in accordance with such essential intent and principles so as to protect such exercise rights as aforesaid.

Section 6. No Rights as a Stockholder; Notice to Holder. Nothing contained in this Warrant shall be construed as conferring upon the Holder the right to vote or to consent or to receive notice as a stockholder in respect of any meeting of stockholders for the election of directors of the Company or any other matter, or any rights whatsoever as a stockholder of the Company.

Section 7. Replacement of Warrant. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and (in the case of loss, theft or destruction) upon delivery of an indemnity agreement (with, in the case of a Holder which is not a qualified institutional buyer within the meaning of Rule 144A under the Act, surety) in an amount reasonably satisfactory to it, or (in the case of mutilation) upon surrender and cancellation thereof, the Company will issue, in lieu thereof, a new Warrant of like tenor.

Section 8. Notices. All notices and other written communications provided for hereunder shall be given in writing and delivered in person or sent by overnight delivery service (with charges prepaid) or by facsimile transmission, if the original of such facsimile transmission is sent by overnight delivery service (with charges prepaid) by the next succeeding Business Day and (i) if to the Holder addressed to it at the address or fax number specified for such Holder in the Warrant Register or at such other address or fax number as the Holder shall have specified to the Company in writing in accordance with this Section 8, and (ii) if to the Company, addressed to it at 1 Wayside Road, Burlington, Massachusetts 01803, Attention General Counsel Fax No: (781) 565-5001 or at such other address or fax number as the Company shall have specified to the Holder in writing in accordance with this Section 8. Notice given in accordance with this Section 8 shall be effective upon the earlier of the date of delivery or the second Business Day at the place of delivery after dispatch.

Section 9. Applicable Law. This Warrant shall be governed by and construed in accordance with the laws of the State of New York without giving effect to principles of conflict of laws.

Section 10. Warrant Share Legend. Each certificate representing Warrant Shares, until such Warrant Shares have been distributed pursuant to a registration statement effective under the Act or sold to the public through a broker, dealer or market maker in compliance with Rule 144 under the Act (or any similar rule then in force) shall bear one or all of the following legends:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.”

Any legend required by the Blue Sky laws of any state to the extent such laws are applicable to the shares represented by the certificate so legended.

Section 11. Captions. The captions of the Sections and subsections of this Warrant have been inserted for convenience only and shall have no substantive effect.

Section 12. Amendment or Waiver. Any term of the Warrants may be amended or waived only by an instrument in writing signed by the Company and a Holder Majority, and any such amendment or waiver (and any other action taken or decision made by a Holder Majority) shall be binding upon all Holders.

IN WITNESS WHEREOF, the undersigned have executed this Warrant as of the [·] day of [·], 2009.

	NUANCE COMMUNICATIONS, INC.


	By:
		Name: Paul Ricci
		Title: Chairman & CEO

	[NAME OF WARRANT HOLDER]


	By:
		Name:
		Title:

[To be signed only upon exercise of Warrant]

TO Nuance Communications, Inc.:

The undersigned, the holder of the within Warrant (the “Holder”), hereby irrevocably elects to exercise the purchase right represented by such Warrant for, and to purchase thereunder, shares of Common Stock of Nuance Communications, Inc. and herewith [makes payment of $ therefor in full payment of the Exercise Payment][tenders securities having a Market Price of $ in full payment of the Exercise Payment] or [elects to receive a payment equal to the difference between (i) the Market Price (as defined in the Warrant) multiplied by (the number of Warrant Shares as to which the payment is being elected) and (ii) , which is the exercise price with respect to such Warrant Shares, in full payment of the Exercise Payment, payable by the Company to the Holder only in shares of Common Stock valued at the Market Price in accordance with the terms of the Warrant], and requests that the certificates for such shares be issued in the name of, and be delivered to , whose address is .

Dated:




		(Signature must conform in all respects to name of Holder as specified on the face of the Warrant)


		Address

[To be signed only upon transfer of Warrant]

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto the right represented by the within Warrant to purchase shares of the Common Stock of Nuance Communications, Inc. to which the within Warrant relates, and appoints attorney to transfer said right on the books of Nuance Communications, Inc. with full power of substitution in the premises.

Dated:


(Signature must conform in all respects to
name of Holder as specified on the face of the Warrant)


		Address

In the presence of:

EX-99.3 4 a09-3214_1ex99d3.htm EX-99.3

Exhibit 99.3

WARRANT AMENDMENT AGREEMENT

THIS WARRANT AMENDMENT AGREEMENT (this “Agreement”) is hereby entered into effective as of January 13, 2009, by Nuance Communications, Inc. (the “Company”) and the warrant holders set forth under the heading “Warrant Holders” on the signature pages hereto (the “Holders”).

WHEREAS, the Holders are the legal and beneficial holders of the following warrants (each a “Warrant” and, collectively, the “Warrants”), each of which (a) was issued as of the respective “Original Issue Dates” (as set forth below), (b) was issued to the respective “Original Warrant Holder” (as set forth below), and (c) is currently held by the “Current Warrant Holder” (as set forth below) with the respective “Original Exercise Period Termination Date/Expiration Date” (as set forth below) (each a “Termination/Expiration Date”):

Warrant Number and Original Issue Date	Original Warrant Holder	Current Warrant Holder	Original Exercise Period Termination Date / Expiration Date

W-20 4/8/04	Warburg Pincus Private Equity VIII, L.P.	Warburg Pincus Private Equity VIII, L.P.	3/2/09

W-21 4/8/04	Warburg Pincus Netherlands Private Equity VIII, C.V. I	Warburg Pincus Netherlands Private Equity VIII, C.V. I	3/2/09

W-22 4/8/04	Warburg Pincus Netherlands Private Equity VIII, C.V. II	Warburg Pincus Netherlands Private Equity VIII, C.V. I	3/2/09

W-23 4/8/04	Warburg Pincus Germany Private Equity VIII K.G.	WP-WPVIII Investors, L.P.	3/2/09

W-24 5/9/05	Warburg Pincus Private Equity VIII, L.P.	Warburg Pincus Private Equity VIII, L.P.	5/9/09

W-25 5/9/05	Warburg Pincus Netherlands Private Equity VIII, C.V. I	Warburg Pincus Netherlands Private Equity VIII, C.V. I	5/9/09

W-26 5/9/05	Warburg Pincus Germany Private Equity VIII, K.G.	WP-WPVIII Investors, L.P.	5/9/09

; and

WHEREAS, the Holders desire to amend each of the Warrants in order to extend each Termination/Expiration Date on the terms set forth herein; and

WHEREAS, the Company and the Holders may so amend each of the Warrants upon mutual written agreement of the Company and the Holders.

NOW THEREFORE, in consideration of the above premises and for due and valuable consideration, the receipt of which is hereby acknowledged, the Company and the Holders do hereby agree as follows:

1. Amendment of Exercise Period Termination Dates. With respect to each of the Warrants identified on the table above as Warrant Numbers W-20, W-21, W-22 and W-23: (A) in such Warrant’s introductory paragraph, the reference to “March 2, 2009” shall be deleted and replaced with the following: “the date (the “Expiration Date”) that is one day following the fifth (5th) Business Day after the six (6) month anniversary of the Closing Date (as defined in the certain Purchase Agreement, dated as of January 13, 2009, by and among the Company (currently known as Nuance Communications, Inc.), Warburg Pincus Private Equity X, L.P. and Warburg Pincus X Partners, L.P. (the “Purchase Agreement”)); provided, however, that if the Purchase Agreement is terminated pursuant to its terms, the Expiration Date shall be the date that is one day following the fifth (5th) Business Day after the later of (a) March 2, 2009 or (b) the date of termination of the Purchase Agreement” and (B) in Section 1.4 of such Warrant, the reference to “March 2, 2009” shall be deleted and replaced with “the Expiration Date.”

2. Amendment of Expiration Dates. With respect to each of the Warrants identified on the table above as Warrant Numbers W-24, W-25 and W-26, in Section 1(a)(x) of such Warrant, the words “5:00 p.m. Eastern Time on the four year anniversary of the Issuance Date” shall be deleted and replaced with the following: “the date (the “Expiration Date”) that is one day following the fifth (5th) Business Day after the six (6) month anniversary of the Closing Date (as defined in the certain Purchase Agreement, dated as of January 13, 2009, by and among the Company (currently known as Nuance Communications, Inc.), Warburg Pincus Private Equity X, L.P. and Warburg Pincus X Partners, L.P. (the “Purchase Agreement”)); provided, however, that if the Purchase Agreement is terminated pursuant to its terms, the Expiration Date shall be the date that is one day following the fifth (5th) Business Day after the later of (a) May 9, 2009 or (b) the date of termination of the Purchase Agreement”.

3. Miscellaneous.

(a) This Agreement is only effective as to the amendments set forth and described above, and in no way affects or impairs the rights of the Company or the Holders with respect to any other rights or obligations pursuant to the Warrants and each of the Company and the Holders acknowledge that the Warrants shall otherwise remain in effect pursuant to their terms. The amendments set forth and described above shall be effective immediately upon execution of this Agreement without further action on the part of the Company or the Holders.

(b) This Agreement shall be governed by and construed in accordance with the laws of the State of New York without giving effect to principles of conflict of laws.

(c) This Agreement may be executed in counterpart, each of which shall be deemed to be an original, but all of which together will constitute one and the same instrument.

(d) The Board of Directors of the Company, has approved the authorization, execution and delivery of this Agreement and the transactions contemplated hereby, including, to the extent applicable, for purposes exempting the transactions contemplated hereby from liability pursuant to Section 16(b) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder, including Rule 16b-3.

IN WITNESS WHEREOF, each of the Company and the Holders has executed this Agreement as of the date and year first set forth above.

NUANCE COMMUNICATIONS, INC.:		WARRANT HOLDERS:

		WARBURG PINCUS PRIVATE EQUITY VIII, L.P.

		By:	Warburg Pincus & Co.,
			its General Partner
By:	/s/ Tom Beaudoin
Name:	Tom Beaudoin
Title:	Chief Financial Officer	By:				/s/ Patrick Severson
		Name:				Patrick Severson
		Title:				Partner

		WARBURG PINCUS NETHERLANDS PRIVATE EQUITY VIII, C.V. I

		By:		Warburg Pincus & Co.,
				its General Partner


		By:				/s/ Patrick Severson
		Name:				Patrick Severson
		Title:				Partner

		WP-WPVIII INVESTORS, L.P.

		By:			Warburg Pincus Partners LLC,
					its General Partner

		By:					Warburg Pincus & Co.,
							its Managing Member


		By:						/s/ Patrick Severson
		Name:							Patrick Severson
		Title:							Partner

[Signature Page to Warrant Amendment Agreement]

EX-99.4 5 a09-3214_1ex99d4.htm EX-99.4

Exhibit 99.4

THIRD AMENDED AND RESTATED STOCKHOLDERS AGREEMENT

This THIRD AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (the “Agreement”) is made as of [·], 2009 by and among Nuance Communications, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Company”), Warburg Pincus Private Equity VIII, L.P., Warburg Pincus Netherlands Private Equity VIII C.V. I, and WP-WPVIII Investors, L.P. (collectively, the “WP VIII Purchasers”), and Warburg Pincus Private Equity X, L.P. and Warburg Pincus X Partners, L.P. (collectively, the “WP X Purchasers” and together with the WP VIII Purchasers, the “Purchasers”).

RECITALS

A. Immediately prior to the closing of the transactions contemplated by the Purchase Agreement (as defined below), the WP VIII Purchasers Beneficially Own an aggregate of 51,737,426 shares of Voting Stock of the Company, including warrants to purchase an aggregate of 10,766,538 shares of the Company Common Stock;

B. The WP X Purchasers are purchasing 17,395,626 shares of Company Common Stock and warrants to purchase an aggregate of 3,862,422 shares of Company Common Stock (the “Warrants”) pursuant to that certain Purchase Agreement, dated as of January 13, 2009 (the “Purchase Agreement”);

C. The Board of Directors of the Company (the “Board”) has determined that it is in the best interests of the Company and its stockholders to issue and sell the shares of Company Common Stock and the Warrants to the WP X Purchasers;

D. The Company and the WP VIII Purchasers are parties to that certain Second Amended and Restated Stockholders Agreement, dated as of May 20, 2008 (the “Prior Agreement”); and

E. The Company and the WP VIII Purchasers desire to amend and restate the rights and obligations set forth in the Prior Agreement, in each case as set forth herein.

NOW THEREFORE, in consideration of the covenants and promises set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

AGREEMENT

1. Certain Definitions. Unless the context otherwise requires, the following terms, for all purposes of this Agreement, shall have the meanings specified in this Section 1:

“Additional Director Board Appointment Period” shall mean the period from the date hereof and ending on the later of (i) the date that the Purchasers shall cease to Beneficially Own at least 25,000,000 shares of Voting Stock (as adjusted from time to time for any stock dividends, combinations, recapitalizations and the like) or (ii) the date that the

Purchasers’ percentage Beneficial Ownership of the Voting Stock is less than the quotient of (x) two (2) divided by (y) the then authorized number of directors of the Company.

“Affiliate” shall have the meaning set forth in Rule 12b-2 of the rules and regulations promulgated under the Exchange Act; provided, however, that for purposes of this Agreement, the Purchasers and their Affiliates, on the one hand, and the Company and its Affiliates, on the other, shall not be deemed to be “Affiliates” of one another.

“Beneficially Own,” “Beneficially Owned,” or “Beneficial Ownership” shall have the meaning set forth in Rule 13d-3 of the rules and regulations promulgated under the Exchange Act.

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

“Company Common Stock” shall mean shares of the Common Stock of the Company, $0.001 par value.

“Company Competitor” shall mean any person or entity (or any Affiliates of such a person or entity) that (i) conducts material activities and operations consisting of providing speech technology primarily for use in telephony-network based services, mobile or embedded platforms, or desktop or server-based dictation software applications, (ii) develops and licenses software that incorporates document capture or image processing technology, (iii) has filed a statement on Schedule 13D pursuant to Rule 13d-l(a) with the SEC that indicates under Item 4 of such Schedule that the person has acquired or holds the securities with a purpose or effect of changing or influencing control of the Company, or in connection with or as a participant in any transaction having that purpose or effect, or (iv) to the Purchasers’ knowledge after a written request, intends to file a statement on Schedule 13D with the SEC indicating under Item 4 of such Schedule that the person has acquired or holds the securities with a purpose or effect of changing or influencing control of the Company, or in connection with or as a participant in any transaction having that purpose or effect.

“Controlled Fund” shall mean any fund of which Warburg Pincus Partners LLC is a general partner.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

“Exchange Offer” shall mean a bona fide exchange offer subject to the provisions of Rule 13e-3 promulgated under the Exchange Act.

“Fair Market Value” means, as of any date of determination, (i) in the case of Company Common Stock, the average of the closing sale prices of Company Common Stock during the 5 trading days immediately preceding such date of determination on the principal U.S. or foreign securities exchange on which such Company Common Stock is listed or, if such Company Common Stock is not listed or primarily traded on any such exchange, the average of the closing sale prices or the closing bid quotations of such security during the 5 day period preceding such date of determination on Nasdaq or any comparable system then in use or, if no such quotations are available, the fair market value of such security as of such date of

determination as determined in good faith by the Company and the holders of a majority in interest of the shares of Company Common Stock then held by the Purchasers and (ii) in the case of property other than cash or a security, the fair market value of such property on such date of determination as determined in good faith by the Company and the holders of a majority in interest of the shares of Company Common Stock then held by the Purchasers; provided, however, that if such parties are unable to reach agreement as to the fair market value of such security pursuant to clause (i) above or such property pursuant to clause (ii) above within a reasonable period of time, the fair market value shall be determined in good faith by an independent investment banking firm selected jointly by the Company and the holders of a majority in interest of the shares of Company Common Stock then held by the Purchasers or, if that selection cannot be made within 15 days, by an independent investment banking firm selected by the American Arbitration Association in accordance with its rules. All costs and expenses of such independent investment banking firm shall be borne 50% by the Company and 50% by the Purchasers, pro rata based on the number of shares of Company Common Stock then held by each.

“Form S-3” means such form under the Securities Act as in effect on the date hereof or any successor or similar registration form under the Securities Act subsequently adopted by the SEC that permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC.

“Holder” means any person owning of record Registrable Securities that have not been sold to the public or any transferee or assignee of record of such Registrable Securities to which the registration rights conferred by this Agreement have been transferred or assigned in accordance with Section 5.8 hereof.

“Permitted Amount” shall mean the sum of (i) up to a maximum of 5% of the issued and outstanding Voting Stock of the Company as calculated immediately following the Closing Date and (ii) any amount of shares of Voting Stock acquired directly from the Company after the date of this Agreement pursuant to an agreement with the Company.

“Register,” “registered” and “registration” refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of effectiveness of such registration statement or document.

“Registrable Securities” means (a) shares of Company Common Stock (i) held by the Purchasers on the day immediately following the Closing Date or (ii) acquired pursuant to open market purchases following the Closing Date, and any Company Common Stock issued as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, any Company Common Stock, warrant, right or other security held by the Purchasers. Notwithstanding the foregoing, Registrable Securities shall not include any securities of the Company sold by any person to the public either pursuant to a registration statement under the Securities Act or Rule 144.

“Registration Expenses” shall mean all expenses incurred by the Company in complying with Sections 5.1 and 5.2 hereof, including, without limitation, all registration and

filing fees, printing expenses, fees and disbursements of counsel for the Company, Blue Sky fees and expenses and the expense of any special audits incidental to or required by any such registration (but excluding the compensation of regular employees of the Company, which shall be paid in any event by the Company, and all underwriting discounts and commissions).

“Representatives” shall mean the directors, officers, employees and independent contractors, agents or advisors (including, without limitation, attorneys, accountants, and investment bankers) of the specified party or any of its Subsidiaries.

“Rule 144” means Rule 144 as promulgated by the SEC under the Securities Act, as such rule may be amended from time to time, or any similar successor rule that may be promulgated by the SEC.

“SEC” or “Commission” means the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act.

“Securities Act” means the Securities Act of 1933, as amended, or any similar successor federal statute and the rules and regulations thereunder, all as the same shall be in effect from time to time.

“Selling Expenses” means all underwriting discounts, selling commissions and stock transfer rates applicable to the sale of Registrable Securities and, except as set forth in the definition of “Registration Expenses” above, all fees and reimbursement of counsel for the Holders.

“Shelf Registration Period” shall mean the period beginning immediately following the Closing Date and ending at 12:00 a.m. New York City time on the 365th day after the effectiveness of any registration statement filed pursuant to the terms of Section 5.3, as such period may be extended.

“Standstill Period” shall mean the three (3) year period beginning on the Closing Date and ending at 12:00 a.m. New York City time on the third anniversary of the Closing Date.

“Subsidiaries” shall mean each corporation, limited liability company, partnership, association, joint venture or other business entity of which any party or any of its Affiliates owns, directly or indirectly, more than 50% of the stock or other equity interest entitled to vote on the election of the members of the board of directors or similar governing body.

“Third Party Tender Offer” shall mean a bona fide public tender offer subject to the provisions of Regulation 14D when first commenced within the meaning of Rule 14d-2(a) of the rules and regulations under the Exchange Act, by a person or 13D Group (which is not made by and does not include any of the Company or any Affiliate of the Company) to purchase or exchange for cash or other consideration any Voting Stock and which consists of an offer to acquire more than 10% of the Voting Power of the Company.

“13D Group” means any group of persons formed for the purpose of acquiring, holding, voting or disposing of Voting Stock which would be required under Section 13(d) of the Exchange Act, and the rules and regulations promulgated thereunder, to file a statement on

Schedule 13D pursuant to Rule 13d-l(a) or Schedule 13G pursuant to Rule 13d-1(c) with the SEC as a “person” within the meaning of Section 13(d)(3) of the Exchange Act if such group Beneficially Owned Voting Stock representing more than 5% of any class of Voting Stock then outstanding.

“Voting Power” shall mean the number of votes entitled to then be cast by the Voting Stock of the Company at any election of directors of the Company, provided that, for the purpose of determining Voting Power, each share of Preferred Stock of the Company, if any (the “Preferred Stock”), shall be deemed to be entitled to the number of votes equal to the number of shares of Company Common Stock into which such share of Preferred Stock could then be converted.

“Voting Stock” shall mean shares of the Company Common Stock and any other securities of the Company having the ordinary power to vote in the election of members of the Board of Directors of the Company and any securities convertible, exchangeable for or otherwise exercisable to acquire voting securities.

2. Appointment of the Purchasers’ Nominee(s) to the Board. The Company hereby agrees that (a) until the date that the Purchasers cease to Beneficially Own at least 10,000,000 shares of Voting Stock (as adjusted from time to time for any stock dividends, combinations, splits, recapitalizations and the like), the Board shall take such action as may be necessary to appoint one (1) member of the Board who shall be designated by the WP VIII Purchasers so long as they hold shares of Company Common Stock and thereafter by the holders of a majority in interest of the shares of Company Common Stock then held by the Purchasers, and (b) until the expiration of the Additional Director Board Appointment Period, the Board shall take such action as may be necessary to appoint a second member of the Board who shall be designated by the WP X Purchasers so long as they hold shares of Company Common Stock and thereafter by the holders of a majority in interest of the shares of Company Common Stock then held by the Purchasers. Each nominee so designated shall be reasonably acceptable to, and approved by a majority of the Board, which acceptance and approval shall not be unreasonably withheld (such nominees from time to time so designated, each a “Purchaser Nominee,” and collectively, the “Purchaser Nominees”). For as long as the Purchaser Nominee(s) have a right to be appointed to the Board pursuant to this Section 2, the Company shall nominate and take such action as may be necessary to cause the Purchaser Nominee(s) to be elected or appointed to the Board. If at any time during the period when the Purchaser Nominee(s) have a right to be appointed to the Board pursuant to this Section 2, there shall occur a vacancy in the Board seat previously occupied by a Purchaser Nominee by reason of resignation, removal, death or incapacity, then such vacancy shall be filled by another Purchaser Nominee designated in accordance with this Section 2.

3. Covenants of the Purchasers.

3.1 Standstill. During the Standstill Period, the Purchasers, Warburg Pincus & Co., and Warburg Pincus Partners LLC, shall not, without the prior written consent of the Company or its Board of Directors:

(a) acquire, offer, seek or propose to acquire, or agree to acquire, directly or indirectly (including acquiring beneficial ownership as defined in Rule 13d-3 under the Exchange Act), by purchase or otherwise, any Voting Stock of the Company or direct or indirect rights to acquire any Voting Stock of the Company, or of any successor to or person in control of the Company, or any assets of the Company or any Subsidiary or division of the Company or of any such successor or controlling person, provided, however, that the Purchasers, Warburg Pincus & Co., and Warburg Pincus Partners LLC may acquire in one or more transactions an aggregate number of shares of Voting Stock equal to the Permitted Amount.

(b) make, or in any way participate, directly or indirectly, in any “solicitation” of “proxies” to vote (as such terms are used in the rules of the SEC), or seek to advise or influence any person or entity with respect to the voting of any Voting Stock of the Company (other than in such Purchaser’s Representatives’ capacities as a member of the Company’s Board of Directors in a manner consist with his or her fiduciary duties);

(c) make any public announcement with respect to, or submit a proposal for or offer of (with or without conditions) (including to the Company’s Board of Directors), any extraordinary transaction involving the Company or any of its securities or assets;

(d) form, join or in any way participate in a 13D Group in connection with any of the foregoing;

(e) otherwise act or seek to control or influence the management or Board of Directors or policies of the Company, whether alone or in concert with others (other than in such Purchaser’s Representatives’ capacities as a member of the Company’s Board of Directors in a manner consistent with his or her fiduciary duties);

(f) take any action that could reasonably be expected to require the Company to make a public announcement regarding the possibility of any of the events described in clauses (a) through (e) above;

(g) request the Company or any of its Representatives, directly or indirectly, to amend or waive any provision of this Section 3.1 in a manner that would require public disclosure; or

(h) direct or instruct any of their respective Subsidiaries, Representatives or Affiliates to take any such action.

Notwithstanding the foregoing, if, at any time during the Standstill Period,

(i) any person or 13D Group (other than any person or 13D Group which includes the Purchasers, their respective Subsidiaries or Representatives) acquires Beneficial Ownership of Voting Stock of the Company representing 40% or more of the then outstanding Voting Stock of the Company;

(ii) any person or 13D Group (other than any person or 13D Group which includes the Purchasers, their respective Subsidiaries or Representatives) announces or commences a tender or exchange offer to acquire Voting Stock of the Company

which, if successful, would result in such person or 13D Group owning, when combined with any other Voting Stock of the Company owned by such person or 13D Group, 50% or more of the then outstanding Voting Stock of the Company;

(iii) the Company enters into, or resolves to enter into, any merger, sale or other business combination transaction pursuant to which the outstanding shares of Common Stock would be converted into cash and/or securities and/or property of another person or 13D Group (other than any person or 13D Group which includes the Purchasers, their respective Subsidiaries or Representatives) or 50% or more of the outstanding shares of Common Stock as of immediately prior to such transaction would be owned by persons other than the then current holders of shares of Common Stock and any person or 13D Group which includes the Purchasers, their respective Subsidiaries or Representatives;

then, except as otherwise provided herein, the Standstill Period shall be suspended and tolled during the pendency of any such event with respect to the Purchasers, their respective Subsidiaries and Representatives and the provisions of subparagraphs (a) through (g) shall not be applicable to the Purchasers, their respective Subsidiaries and Representatives during the pendency of any such event. For the avoidance of doubt, the Standstill Period shall resume and be extended by an amount of time equal to the time during which such event was pending, and the provisions of subparagraphs (a) through (g) shall resume to be applicable to the Purchasers, their respective Subsidiaries and Representatives in the event that the provisions of (i) through (iii) cease to be applicable, such as, for example and without limitation, disposition of the Voting Stock of the Company to below 40% by the person or 13D Group, withdrawal of the tender or exchange offer by the person or 13D Group, or termination of merger, sale or other business combination transaction.

3.2 Transfer Restrictions.

(a) The Purchasers shall not (and shall not permit any Affiliate to), directly or indirectly:

(i) Sell, transfer, pledge, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, transfer the economic risk of ownership of, or otherwise dispose of (each, a “Transfer”) any Voting Stock or Voting Power to any person or group that is conducting, is participating or has participated in a solicitation of proxies in opposition to the recommendation or proposal of the Board, or has proposed or otherwise solicited stockholders of the Company for approval of one or more stockholder proposals;

(ii) Transfer five percent (5%) or more of the Voting Stock or Voting Power (in one or a series of transactions) in response to a Third Party Tender Offer or an Exchange Offer with respect to which the Board shall not have recommended that stockholders of the Company accept such offer, unless prior to such Transfer, the Purchasers have complied with the provisions of Section 3.3 below; or

(iii) Transfer five percent (5%) or more of the Voting Stock or Voting Power (in one or a series of transactions that have not been approved by a majority of the

Board) to a Company Competitor who has made a bona fide written offer to acquire such securities, unless prior to such Transfer, the Purchasers have complied with the provisions of Section 3.3 below.

(b) Prior to the date that is one hundred eighty (180) days following the Closing Date, no Purchaser will, directly or indirectly, Transfer any shares of Voting Stock (it being understood that Transfers of, or other transactions with respect to direct or indirect ownership interests in a Purchaser the purpose of which is not to Transfer shares of Voting Stock shall not be considered to be direct or indirect Transfers of shares of Voting Stock) except for the following:

(i) Transfers to other Purchasers;

(ii) Transfers in connection with a bona fide pledge to, or similar arrangement in connection with a bona fide borrowing from a financial institution;

(iii) Transfers in a transaction approved by a majority of the Board, excluding the Purchaser Nominees; or

(iv) Transfers in connection with a tender offer, merger, sale of all or substantially all the Company’s assets or any similar transaction involving the Company approved and/or recommended by a majority of the Board, excluding the Purchaser Nominees.

3.3 The Company’s Right of First Refusal.

(a) Prior to the Purchasers effecting any Transfer of Voting Stock or Voting Power that is subject to the restrictions set forth in Section 3.2(a), the Company shall have a first refusal right to purchase such Voting Stock or Voting Power on the following terms and conditions:

(i) The Purchasers shall give prior notice (the “Transfer Notice”) to the Company in writing of such intention, specifying the name of the proposed purchaser or transferee, the amount of Voting Stock or Voting Power proposed to be the subject of such Transfer, the proposed price therefor and the other material terms upon which such disposition is proposed to be made (including, if any, a copy of a bona fide written offer).

(ii) The Company shall have the right, exercisable by written notice given by the Company to the Purchasers within (i) 72-hours with respect to a Transfer addressed in Section 3.2(b) above, and (ii) twenty (20) business days with respect to a Transfer addressed in Section 3.2(a) above, after receipt of such Transfer Notice (the “Response Notice”), to purchase all or any portion of the Voting Stock or Voting Power specified in such Transfer Notice for cash at the price per share specified in the Transfer Notice or, if consideration other than cash is specified in the Transfer Notice, in an amount equal to the Fair Market Value of such non-cash consideration.

(iii) If the Company exercises its right of first refusal hereunder, the closing of the purchase of the Voting Stock or Voting Power with respect to which such right has been exercised shall take place within thirty (30) calendar days after the Company gives the

Response Notice to the Purchasers or, if later, within five (5) business days of the determination of the Fair Market Value of any non-cash consideration. Upon exercise of its right of first refusal, the Company and the Purchasers shall be legally obligated to consummate the purchase and sale contemplated thereby and shall use their commercially reasonable efforts to secure any approvals required in connection therewith.

(iv) If the Company does not exercise its right of first refusal hereunder within the time specified for such exercise in subparagraph (ii) above with respect to all of the Voting Stock or Voting Power specified in such Transfer Notice, the Purchasers shall be free, during the period of ninety (90) calendar days following the expiration of such time for exercise, to Transfer or tender for Transfer the Voting Stock or Voting Power specified in such Transfer Notice with respect to which the Company has not exercised its first refusal rights to the proposed purchaser or transferee specified in such Transfer Notice and on terms not materially less favorable to the Purchasers than the terms specified in such Transfer Notice. After the expiration of such 90-day period, except as otherwise provided herein, the Purchasers may not Transfer the Voting Stock or Voting Power specified in such Transfer Notice without first complying with the provisions of this Section 3.3.

(b) The Company may assign its right of first refusal under this Section 3.3 to any other person or persons; provided, however, that the Company shall be liable for the timely performance of any obligations in this Section 3.3 by such assignee.

3.4 Other Transfers. Except as provided in this Section 3, this Agreement does not, and is not intended to, restrict the Purchasers ability to Transfer any Voting Stock or Voting Power.

4. Prohibited Transfer. Any purchase which causes the Purchasers to be in violation of the terms of Section 3 above (“Prohibited Transfer”) shall not be effected by the Company and shall be voidable at the option of the Company by their giving written notice to the transferor, his transferee and the Purchasers. Each certificate representing Voting Stock held by the Purchasers shall be endorsed by the Company with a legend reading as follows:

“THE SHARES EVIDENCED HEREBY ARE SUBJECT TO A STOCKHOLDERS AGREEMENT BY AND BETWEEN THE COMPANY AND THE HOLDER HEREOF (A COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY), AND NO TRANSFER OF THE SHARES EVIDENCED HEREBY SHALL BE EFFECTIVE EXCEPT IN COMPLIANCE WITH THE TERMS THEREOF.”

5. Registration Rights.

5.1 Demand Registration.

(a) Subject to the conditions of this Section 5.1, if the Company shall receive a written request from the Holders holding not less than a majority of the Registrable Securities then outstanding that the Company file a registration statement with respect to all or part of the Registrable Securities under the Securities Act with an anticipated aggregate offering price of at least $10,000,000, then the Company shall, within ten (10) calendar days of the

receipt thereof, give written notice of such request to all Holders, and, subject to the limitations of this Section 5.1, use its commercially reasonable efforts to effect, as expeditiously as reasonably possible, the registration under the Securities Act of all Registrable Securities that all Holders request to be registered pursuant to and in accordance with this Agreement (a “Demand Registration”).

(b) Notwithstanding the foregoing, if the Company shall furnish to the Holders requesting a registration statement pursuant to this Section 5.1, a certificate signed by the President or Chief Executive Officer of the Company stating that in the Board’s good faith judgment it would be seriously detrimental to the Company and its stockholders for such a registration statement to be filed in the near future, the Company shall have the right to defer such filing for a period of not more than ninety (90) days after receipt of the request of the Holders specified in Section 5.1(a); provided, however, that the Company may not utilize this right more than twice in any twelve-month period.

(c) The Company shall not be required to effect or take any action to effect a registration pursuant to this Section 5.1:

(i) prior to the commencement of the Shelf Registration Period;

(ii) after the Company has effected four (4) Demand Registrations pursuant to this Section 5.1, and such registrations have been declared or ordered effective (which, for the avoidance of doubt, shall mean that the registrations shall have been effective for an aggregate of ninety (90) calendar days, or until all Registrable Securities covered thereby have been sold, if earlier);

(iii) if the Holders making the request provided for in Section 5.1(a) propose to dispose of Registrable Securities that could be disposed of in a single ordinary brokerage transaction under the quantity limitation of Rule 144; or

(iv) if the Holders making the request provided for in Section 5.1(a) propose to dispose of Registrable Securities that may be registered on Form S-3 pursuant to a request made pursuant to Section 5.2 below.

5.2 Form S-3 Registration. If at any time following the commencement of the Shelf Registration Period, the Company shall receive from the Holders holding not less than a majority of the Registrable Securities then outstanding a written request that the Company effect a registration on Form S-3 and any related qualification or compliance with respect to all or a part of the Registrable Securities owned by such Holders, the Company will:

(a) within ten (10) calendar days after receipt of such notice, give written notice of the proposed registration, and any related qualification or compliance, to all other Holders of Registrable Securities; and

(b) as soon as reasonably practicable, effect such registration (a “S-3 Registration”) and all such qualifications and compliances as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holders’ Registrable

Securities as are specified in such request, together with all or such portion of the Registrable Securities of any other Holder or Holders joining in such request as are specified in a written request given within fifteen (15) calendar days after receipt of such written notice from the Company; provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance pursuant to this Section 5.2, (i) if Form S-3 is not available to the Company for such offering, (ii) if the aggregate proceeds from the sale of Registrable Securities proposed to be sold pursuant to a Form S-3 registration statement will not exceed $10,000,000, (iii) if, the Company has effected two S-3 Registrations pursuant to this Section 5.2, and such registrations have been declared or ordered effective (which, for the avoidance of doubt, shall mean that the registrations shall have been effective for an aggregate of ninety (90) calendar days, or until all Registrable Securities covered thereby have been sold, if earlier), or (iv) if the Holders propose to dispose of Registrable Securities that could be disposed of in a single ordinary brokerage transaction under the quantity limitation of Rule 144.

(c) Notwithstanding the foregoing, if the Company shall furnish to the Holders requesting a registration statement pursuant to this Section 5.2, a certificate signed by the President or Chief Executive Officer of the Company stating that in the Board’s good faith judgment it would be seriously detrimental to the Company and its stockholders for such a registration statement to be filed in the near future, the Company shall have the right to defer such filing for a period of not more than ninety (90) days after receipt of the request of the Holders specified in this Section 5.2; provided, however, that the Company may not utilize this right more than twice in any twelve-month period.

Registrations effected pursuant to this Section 5.2 shall be counted as demands for registration effected pursuant to Section 5.1, and in no event shall the Company be required to effect more than two (2) S-3 Registrations.

5.3 Shelf Registration. During the Shelf Registration Period, if the Company shall receive from the Holders holding not less than a majority of the Registrable Securities then outstanding a written request that the Company effect a registration on Form S-3 with respect to all or part of the Registrable Securities owned by such Purchasers, the Company will as soon as reasonably practicable, effect such registration (a “Shelf Registration Statement”) and all such qualifications and compliances as may be so requested and as would permit or facilitate the distribution of all or such portion of such Holders’ Registrable Securities as are specified in such request exclusively to partners, limited partners, retired partners, retired limited partners, members, retired members and stockholders of such Holders; provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance pursuant to this Section 5.3, if Form S-3 is not available to the Company for such offering. The Company shall use its commercially reasonable efforts to keep the Shelf Registration Statement effective, current and available for use by the Purchasers during the Shelf Registration Period. While the Shelf Registration Statement remains in effect, the Company may at any time and from time to time deliver to the Holders written notice to the effect that distributions may not be effected under the Shelf Registration Statement for a period of time (a “Blackout Period”) because of the existence of material facts not disclosed or incorporated by reference in such Shelf Registration Statement and in the then-current prospectus included therein; provided, however, that the duration of any Blackout Period shall not exceed ninety (90) days. Upon receipt of any such notice, the Holders shall refrain from distributing Registrable Securities

under such Shelf Registration Statement until the Holders have received notice from the Company to the effect that such distributions may then be effected. The Company shall as promptly as reasonably possible update the Shelf Registration Statement and the prospectus included therein in order to permit Registrable Securities to be distributed, and the Shelf Registration Period shall automatically be extended by the aggregate number of days during which the Holders were instructed to refrain from distributing Registrable Securities during all Blackout Periods, without duplication.

5.4 Expenses of Registration. Except as specifically provided herein, all Registration Expenses incurred in connection with any registration effected pursuant to Section 5.1, Section 5.2 or Section 5.3 herein shall be borne by the Company. All Selling Expenses incurred in connection with any registrations effected pursuant to Section 5.1 or Section 5.2 shall be borne by the holders of the securities so registered pro rata on the basis of the number of shares so registered. The Company shall not, however, be required to pay for expenses of any registration proceeding begun, the request of which has been subsequently withdrawn by the Holders initiating such registration, unless a majority of the Holders of Registrable Securities agree to forfeit their right to one Demand Registration or S-3 Registration, as the case may be, pursuant to Section 5.1 or Section 5.2 (in which event such right shall be forfeited by all Holders of Registrable Securities). If such Holders are required to pay the Registration Expenses, such expenses shall be borne by the holders of securities (including Registrable Securities) initiating such registration in proportion to the number of shares for which registration was requested.

5.5 Underwriting. If the Company determines in its sole discretion that the registration statement under which the Company gives notice under Section 5.1 or Section 5.2 will be for an underwritten offering, the Company shall so advise the Holders of Registrable Securities. In such event, the right of any such Holder to be included in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their Registrable Securities through such underwriting shall enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by the Company. Notwithstanding any other provision contained in this Agreement, if the managing underwriter determines in good faith that marketing factors require a limitation of the number of shares to be underwritten (including Registrable Securities), the number of shares that may be included in the underwriting shall be allocated first to requesting Holders on a pro rata basis based on the total number of Registrable Securities then held by all such requesting Holders, then to any other shareholders on a pro rata basis based on the number of shares of Company Common Stock then held by such other shareholders. If any Holder disapproves of the terms of any such underwriting, such Holder may elect to withdraw therefrom by written notice to the Company and the managing underwriter, delivered at least ten (10) business days prior to the effective date of the registration statement. Any Registrable Securities excluded or withdrawn from such underwriting shall be excluded and withdrawn from the registration. For any Holder that is a partnership, limited partnership, limited liability company or corporation, the partners, limited partners, retired partners, retired limited partners, members, retired members and stockholders of such Holder, or the estates and family members of any such partners, limited partners, retired partners, retired limited partners, members, retired members and any trusts for the benefit of any of the foregoing persons shall be deemed to be collectively a single “Holder,” and any pro rata reduction with respect to such “Holder” shall be based upon

the aggregate amount of shares carrying registration rights owned by all entities and individuals included in such “Holder,” as defined in this sentence.

5.6 Furnishing Information. It shall be a condition precedent to the obligations of the Company to take any action pursuant to Sections 5.1 and 5.2 above that the selling Holders shall furnish to the Company such information regarding themselves, the Registrable Securities held by them and the intended method of disposition of such securities as shall be required to effect the registration of their Registrable Securities.

5.7 Indemnification.

(a) The Company will indemnify and hold harmless each Holder, each of its officers, directors and partners, legal counsel, and accountants and each person controlling such Holder within the meaning of Section 15 of the Securities Act, with respect to which registration, qualification or compliance has been effected pursuant to Section 5, and each underwriter, if any, and each person who controls within the meaning of Section 15 of the Securities Act any underwriter, against all expenses, claims, losses, damages, and liabilities (or actions, proceedings or settlements in respect thereof) arising out of or based on (i) any untrue statement or alleged untrue statement of a material fact contained in any prospectus, free-writing prospectus, offering circular, or other document, including any related registration statement, notification or the like, incident to any such registration, qualification or compliance, (ii) any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or (iii) any violation by the Company of the Securities Act or any rule or regulation thereunder applicable to the Company and relating to action or inaction required of the Company in connection with any such registration, qualification or compliance, and will reimburse each such Holder, each of its officers, directors, partners, legal counsel, and accountants and each person controlling such Holder, each such underwriter and each person who controls any such underwriter, for any legal and any other expenses reasonably incurred in connection with investigating and defending or settling any such claim, loss, damage, liability or action; provided, however, that the Company will not be liable in any such case to the extent that any such claim, loss, damage, liability or expense arises out of or is based on any untrue statement or omission based upon written information furnished to the Company by such Holder or underwriter. It is agreed that the indemnity agreement contained in this Section 5.7(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, or action if such settlement is effected without the consent of the Company.

(b) Each Holder will, if Registrable Securities held by such Holder are included in the securities as to which such registration, qualification or compliance is being effected, indemnify the Company, each of its directors and officers, legal counsel and accountants, and each underwriter, if any, of the Company’s securities covered by such a registration statement, each person who controls the Company or such underwriter within the meaning of Section 15 of the Securities Act, each other such Holder and each of its officers and directors, and each person controlling such other Holder, against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on (i) any untrue statement or alleged untrue statement of a material fact by such Holder contained in any such registration statement, prospectus, free-writing prospectus, offering circular or other document, or (ii) any omission or alleged omission to state therein by such Holder a material fact required to be stated

therein or necessary to make the statements therein not misleading, and will reimburse the Company and such Holders, directors, officers, legal counsel, accountants, persons, underwriters or control persons for any legal or any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission is made in such registration statement, prospectus, offering circular or other document in reliance upon and in conformity with written information furnished to the Company by such Holder; provided, however, that the obligations of such Holder hereunder shall not apply to amounts paid in settlement of any such claims, losses, damages or liabilities (or actions in respect thereof) if such settlement is effected without the consent of such Holder; and provided that in no event shall any indemnity under this Section 5.7(b) exceed the net proceeds from the offering received by such Holder.

(c) Each party entitled to indemnification under this Section 5.7 (the “Indemnified Party”) shall give notice to the party required to provide indemnification (the “Indemnifying Party”) promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of such claim or any litigation resulting therefrom; provided, however, that legal counsel for the Indemnifying Party, who shall conduct the defense of such claim or any litigation resulting therefrom, shall be approved by the Indemnified Party (whose approval shall not be unreasonably withheld), and the Indemnified Party may participate in such defense at such party’s expense; and, provided further, however, that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Section 5.7(c), to the extent such failure is not prejudicial. Consent by the Indemnifying Party to entry of any judgment or entry into any settlement shall not bind the Indemnified Party without the Indemnified Party’s written consent, unless such settlement includes as an unconditional term thereof the giving by the claimant or plaintiff to the Indemnified Party of a release from all liability with respect to such claim or litigation. Each Indemnified Party shall furnish such information regarding itself or the claim in question as the Indemnifying Party may reasonably request in writing and as shall be reasonably required in connection with defense of such claim and litigation resulting therefrom.

(d) If the indemnification provided for in this Section 5.7 is held by a court of competent jurisdiction to be unavailable to an Indemnified Party with respect to any loss, liability, claim, damage or expense referred to herein, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party hereunder, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, liability, claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with the statements or omissions that resulted in such loss, liability, claim, damage or expense as well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified Party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party and to parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent such statement or omissions.

(e) Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with an underwritten public offering of the Company’s securities are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control.

5.8 Transfer or Assignment of Registration Rights. The rights to cause the Company to register Registrable Securities pursuant to this Section 5 may not be transferred or assigned by a Holder without the prior written consent of the Company.

5.9 Amendment of Registration Rights. Any provision of this Section 5 may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the holders of at least a majority of the Registrable Securities then outstanding. Any amendment or waiver effected in accordance with this Section 5.9 shall be binding upon each Holder and the Company.

6. Management Rights; Other Matters.

6.1 For so long as any Purchaser owns 1,000,000 shares of Voting Stock, the Company covenants that:

(a) if any Purchaser is not represented on the Board, such Purchaser shall be entitled to consult with and advise management of the Company on significant business issues, including management’s proposed annual operating plans, and management will meet with the Purchaser regularly during each year at the Company’s facilities at mutually agreeable times for such consultation and advice and to review progress in achieving said plans;

(b) each Purchaser may examine the books and records of the Company and inspect its facilities and may request information at reasonable times and intervals concerning the general status of the Company’s financial condition and operations, provided that access to highly confidential proprietary information and facilities need not be provided; and

(c) if any Purchaser is not represented on the Board, the Company shall, concurrently with delivery to the Board, give a representative of such Purchaser copies of all notices, minutes, consents and other material that the Company provides to its directors, except that the representative may be excluded from access to any material or meeting or portion thereof if the Board determines in good faith, upon advice of counsel, that such exclusion is reasonably necessary to preserve the attorney-client privilege, to protect highly confidential proprietary information, or for other similar reasons, provided that, upon reasonable notice, at a scheduled meeting of the Board or such other time, if any, as the Board may determine in its sole discretion, such representative may address the Board with respect to such Purchaser’s concerns regarding significant business issues facing the Company.

6.2 For as long as the Purchasers are entitled to appoint one or more Purchaser Nominees pursuant to the terms of this Agreement, the Board, or a committee thereof consisting of non-employee directors (as such term is defined for purposes of Rule 16b-3 under the Exchange Act), shall, if requested by a Purchaser, and to the extent then permitted under applicable law, convene a meeting to consider in good faith one or more Purchasers request for

the Board or committee thereof to adopt resolutions and otherwise use reasonable efforts to cause any acquisition from the Company of Company Common Stock or dispositions to the Company of Company Common Stock (including in connection with any exercise of warrants held by a Purchaser) to be exempt under Rule 16b-3 under the Exchange Act.

7. Miscellaneous.

7.1 Governing Law; Jurisdiction. This Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of Delaware without giving effect to the principles of conflicts of laws. Any legal action or other legal proceeding relating to this Agreement or the enforcement of any provision of this Agreement may be brought or otherwise commenced in any state or federal court located in the State of Delaware. Each party hereto agrees to the entry of an order to enforce any resolution, settlement, order or award made pursuant to this Section 7.1 by the state and federal courts located in the State of Delaware and in connection therewith hereby waives, and agrees not to assert by way of motion, as a defense, or otherwise, any claim that such resolution, settlement, order or award is inconsistent with or violative of the laws or public policy of the laws of the State of Delaware or any other jurisdiction.

7.2 Successors and Assigns. Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successor and assigns of the parties hereto.

7.3 Entire Agreement; Amendment. This Agreement, the Purchase Agreement and the Warrants constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof. Any previous agreements among the parties relative to the specific subject matter hereof, including but not limited to the Prior Agreement, are superseded by this Agreement. Neither this Agreement nor any provision hereof may be amended, changed, waived, discharged or terminated other than by a written instrument signed by the party against who enforcement of any such amendment, change, waiver, discharge or termination is sought.

7.4 Notices, etc. All notices and other communications required or permitted hereunder shall be effective upon receipt and shall be in writing and may be delivered in person, by telecopy, electronic mail, express delivery service or U.S. mail, in which event it may be mailed by first-class, certified or registered, postage prepaid, addressed, to the party to be notified, at the respective addresses set forth below, or at such other address which may hereinafter be designated in writing:

(a)	If to the Purchasers, to:

	Warburg Pincus Private Equity X, L.P.
	Warburg Pincus X Partners, L.P.
	Warburg Pincus Private Equity VIII, L.P.
	Warburg Pincus Netherlands Private Equity VIII, C.V. I
	WP-WPVIII Investors, L.P.
	c/o Warburg Pincus LLC

	466 Lexington Avenue
	New York, NY 10017
	Attention: Jeffrey A. Harris
	Fax No. 212-878-6139

	with a copy to:

	Willkie Farr & Gallagher LLP
	787 Seventh Avenue
	New York, NY 10019
	Attention:	Steven J. Gartner, Esq.
		Robert T. Langdon, Esq.
	Fax No. 212-728-8111

(b)	If to the Company, to:

	Nuance Communications, Inc.
	1 Wayside Road
	Burlington, MA 01803
	Attention:		Chief Executive Officer
			General Counsel
	Phone: 781-565-5000
	Fax: 781-565-5001

	with a copy to:

	Wilson Sonsini Goodrich & Rosati
	1700 K Street, NW
	Fifth Floor
	Washington, DC 20006
	Attention: Robert D. Sanchez, Esq.
	Fax No.: 202-973-8899

7.5 Severability. If any provision of this Agreement shall be judicially determined to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

7.6 Titles and Subtitles. The titles of the Articles and Sections of this Agreement are for convenience of reference only and in no way define, limit, extend, or describe the scope of this Agreement or the intent of any of its provisions.

7.7 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

7.8 Delays or Omissions. It is agreed that no delay or omission to exercise any right, power or remedy accruing to any party upon any breach or default of any other party under this Agreement shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach or default, or any acquiescence therein, or of any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character of any breach or default under this Agreement, or any waiver of any provisions or conditions of this Agreement must be in writing and shall be effective only to the extent specifically set forth in writing, and that all remedies, either under this Agreement, by law or otherwise, shall be cumulative and not alternative.

7.9 Consents. Any permission, consent, or approval of any kind or character under this Agreement shall be in writing and shall be effective only to the extent specifically set forth in such writing.

7.10 SPECIFIC PERFORMANCE. THE PARTIES HERETO AGREE THAT IRREPARABLE DAMAGE WOULD OCCUR IN THE EVENT THAT ANY OF THE PROVISIONS OF THIS AGREEMENT WERE NOT PERFORMED IN ACCORDANCE WITH ITS SPECIFIC INTENT OR WERE OTHERWISE BREACHED. IT IS ACCORDINGLY AGREED THAT THE PARTIES SHALL BE ENTITLED TO AN INJUNCTION OR INJUNCTIONS, WITHOUT BOND, TO PREVENT OR CURE BREACHES OF THE PROVISIONS OF THIS AGREEMENT AND TO ENFORCE SPECIFICALLY THE TERMS AND PROVISIONS HEREOF, THIS BEING IN ADDITION TO ANY OTHER REMEDY TO WHICH THEY MAY BE ENTITLED BY LAW OR EQUITY, AND ANY PARTY SUED FOR BREACH OF THIS AGREEMENT EXPRESSLY WAIVES ANY DEFENSE THAT A REMEDY IN DAMAGES WOULD BE ADEQUATE.

7.11 Construction of Agreement. No provision of this Agreement shall be construed against either party as the drafter thereof.

7.12 Section References. Unless otherwise stated, any reference contained herein to a Section or subsection refers to the provisions of this Agreement.

7.13 Variations of Pronouns. All pronouns and all variations thereof shall be deemed to refer to the masculine, feminine, or neuter, singular or plural, as the context in which they are used may require.

[Remainder of Page Intentionally Left Blank]

IN WITNESS WHEREOF, the parties have caused this Third Amended and Restated Stockholders Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first written above.

	NUANCE COMMUNICATIONS, INC.


	By:
		Name: Paul Ricci
		Title: Chief Executive Officer


	PURCHASERS

	WARBURG PINCUS PRIVATE EQUITY VIII,
		L.P.


	By:	Warburg Pincus Partners LLC,
		its General Partner

		By: Warburg Pincus & Co.,
		its Managing Member


	By:
		Name:
		Title:


	WARBURG PINCUS NETHERLANDS
	PRIVATE EQUITY VIII, C.V. I

	By:	Warburg Pincus Partners LLC,
		its General Partner

		By: Warburg Pincus & Co.,
		its Managing Member


	By:
		Name:
		Title:

	WP-WPVIII INVESTORS, L.P.

	By:	Warburg Pincus Partners LLC,
		its General Partner

	By:	Warburg Pincus & Co.,
		its Managing Member


	By:
		Name:
		Title:

	WARBURG PINCUS PRIVATE EQUITY X, L.P.

	By:	Warburg Pincus X L.P.,
		its General Partner

	By:	Warburg Pincus X LLC,
		its General Partner

	By:	Warburg Pincus Partners, LLC,
		its Managing Member

	By:	Warburg Pincus & Co.,
		its Managing Member


	By:
		Name:
		Title:

	WARBURG PINCUS X PARTNERS, L.P.

	By:	Warburg Pincus X L.P.,
		its General Partner

	By:	Warburg Pincus X LLC,
		its General Partner

	By:	Warburg Pincus Partners, LLC,
		its Managing Member

	By:	Warburg Pincus & Co.,
		its Managing Member


	By:
		Name:
		Title:

EX-99.5 6 a09-3214_1ex99d5.htm EX-99.5

Exhibit 99.5

AMENDED AND RESTATED JOINT FILING AGREEMENT

THIS AMENDED AND RESTATED JOINT FILING AGREEMENT is entered into as of January 15, 2009, by and among the parties hereto. The undersigned hereby agree that the Statement on Schedule 13D with respect to the common stock, par value $0.001 per share, of Nuance Communications, Inc., a Delaware corporation formerly known as ScanSoft, Inc., and any amendment thereafter signed by each of the undersigned shall be, filed on behalf of each undersigned pursuant to and in accordance with the provisions of 13d-1(k) under the Securities Exchange Act of 1934, as amended.

Dated: January 15, 2009	WARBURG PINCUS PRIVATE EQUITY X, L.P.
	By:		Warburg Pincus X L.P.,
			its General Partner

	By:		Warburg Pincus X LLC,
			its General Partner

	By:		Warburg Pincus Partners, LLC,
			its Sole Member

	By:		Warburg Pincus & Co.,
			its Managing Member

	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS X PARTNERS, L.P.
	By:		Warburg Pincus X L.P.,
			its General Partner

	By:		Warburg Pincus X LLC,
			its General Partner

	By:		Warburg Pincus Partners, LLC,
			its Sole Member

	By:		Warburg Pincus & Co.,
			its Managing Member

	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS X, LLC
	By:		Warburg Pincus Partners, LLC,
			its Sole Member

	By:		Warburg Pincus & Co.,
			its Managing Member

	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS X, L.P.
	By:		Warburg Pincus X LLC,
			its General Partner

	By:		Warburg Pincus Partners, LLC,
			its Sole Member

	By:		Warburg Pincus & Co.,
			its Managing Member

	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Member

Dated: January 15, 2009	WARBURG PINCUS PRIVATE EQUITY VIII,
	L.P.
	By:		Warburg Pincus Partners, LLC,
			its General Partner

	By:		Warburg Pincus & Co.,
			its Managing Member


	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS PARTNERS, LLC
	By:		Warburg Pincus & Co.,
			its Managing Member


	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Partner

Dated: January 15, 2009	WARBURG PINCUS LLC


	By:	/s/ Scott A. Arenare
		Name: Scott A. Arenare
		Title: Managing Director

Dated: January 15, 2009	WARBURG PINCUS & CO.


	By:	/s/ Scott A. Arenare
	Name: Scott A. Arenare
	Title: Partner

Dated: January 15, 2009


	By:	/s/ Scott A. Arenare
	Name: Charles R. Kaye
	By: Scott A. Arenare, Attorney-in-Fact*

Dated: January 15, 2009


	By:	/s/ Scott A. Arenare
	Name: Joseph P. Landy
	By: Scott A. Arenare, Attorney-in-Fact**