TABLE OF CONTENTS

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ARTICLE I THE MERGER					1
1.1		The Merger			1
1.2		Closing			1
1.3		Effective Time			2
1.4		Corporate Organization			2
ARTICLE II EFFECT OF THE MERGER ON THE CAPITAL STOCK OF THE CONSTITUENT CORPORATIONS					2
2.1		Definitions			2
2.2		Conversion of Capital Stock			4
2.3		Exchange of Stock Options			4
2.4		Escrowed Consideration			5
2.5		Cash Paid at Closing; Holdbacks and Adjustments.			5
2.6		Vesting of Stock Consideration			6
2.7		Additional Surrender and Payment Provisions			7
2.8		Dissenters Rights			8
2.9		Adjustments			8
2.10		Fractional Shares			8
2.11		Withholding Rights			9
2.12		Lost Certificates			9
2.13		Tax Consequences			9
2.14		Exemption from Registration			9
ARTICLE III THE SURVIVING CORPORATION					9
3.1		Certificate of Incorporation			9
3.2		Bylaws			10
3.3		Directors and Officers			10
ARTICLE IV REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANY AND TTC					10
4.1		Organization and Qualification			10
4.2		Capital Structure			11
4.3		No Subsidiaries or Equity Investments			12
4.4		Authority			12

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4.5		No Conflict with Other Instruments			13
4.6		Consents			13
4.7		Financial Statements			13
4.8		Absence of Changes			14
4.9		Properties			16
4.10		Environmental Matters			16
4.11		Taxes			17
4.12		Employees and Employee Benefit Plans			19
4.13		Labor Matters			21
4.14		Compliance with Law			21
4.15		Litigation			21
4.16		Contracts			21
4.17		No Default			22
4.18		Proprietary Rights			23
4.19		Insurance			25
4.20		Brokers or Finders			25
4.21		Related Parties			26
4.22		Certain Advances			27
4.23		Takeover Statutes			27
4.24		Receivables			27
4.25		Bank Accounts, Powers, etc.			27
4.26		Stockholder Information			27
4.27		Regulatory			27
4.28		Underlying Documents			28
4.29		No Misleading Statements			28
4.30		Certain Tax Matters			28
ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB					28
5.1		Organization			28
5.2		Authority			29
5.3		Governmental Consents			29
ARTICLE VI CONDUCT PRIOR TO THE EFFECTIVE TIME					29
6.1		Conduct of Business of the Company and TTC			29

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6.2		No Solicitation			31
6.3		Strategic Agreements			32
ARTICLE VII ADDITIONAL AGREEMENTS AND REPRESENTATIONS					33
7.1		Accredited Investor Status; Acknowledgement of Risk			33
7.2		Access to Information; Interim Financial Information			33
7.3		Confidentiality			33
7.4		Expenses			33
7.5		Public Disclosure			34
7.6		Reasonable Efforts			34
7.7		Conduct; Notification of Certain Matters			34
7.8		Blue Sky Laws			35
7.9		Legal Compliance			35
7.10		Additional Documents and Further Assurances			35
ARTICLE VIII CONDITIONS TO THE MERGER					35
8.1		Conditions to Obligations of Each Party to Effect the Merger			35
8.2		Additional Conditions to Obligations of the Company			35
8.3		Additional Conditions to the Obligations of Parent and Merger Sub			36
ARTICLE IX INDEMNIFICATION AND ESCROW					38
9.1		Survival of Representations and Warranties			38
9.2		Indemnification and Escrow Arrangements			38
ARTICLE X TERMINATION, AMENDMENT, WAIVER, CLOSING					45
10.1		Termination			45
10.2		Effect of Termination			46
10.3		Amendment or Supplement			46
10.4		Extension of Time, Waiver			47
ARTICLE XI GENERAL					47
11.1		Notices			47
11.2		Headings			48
11.3		Counterparts and Facsimile			49
11.4		Entire Agreement; Assignment			49
11.5		Severability			49
11.6		Other Remedies			49
11.7		Governing Law			49

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11.8		Absence of Third-Party Beneficiary Rights			49
11.9		No Reliance			49

EXHIBITS and SCHEDULES

Exhibit A		Form of Escrow Agreement
Exhibit B		Opinion of Seller’s Counsel
Exhibit C		Form of Offer Letter for Jerry Woods
Exhibit D		Form of Offer Letter for Glory Johnson
Schedule 2.5(a)		Estimated Stockholders Payments at Closing
Schedule 7.10		Required Consents
Schedule 4.18(b)		Proprietary Rights
Schedule 8.3(l)		Employees

TABLE OF DEFINED TERMS

		Cross Reference in
Term		Agreement
accredited investors		2.14
Acquisition Transaction		6.2(a)
Affiliate		4.21(a)
Aggregate Closing Price		2.1(c)
Aggregate Common Number		2.1(a)
Aggregate Purchase Price		2.1(b)
Audited Financial Statements		4.7
Auditor		7.10
Auditor’s Fees		7.4
Average Closing Price		2.1(c)
Balance Sheet		4.7
Balance Sheet Date		4.7
Business Day		4.2(e)
Cash Ratio		2.1(e)
Certificate of Merger		1.3
Closing		1.2
Closing Cash Consideration		2.1(f)
Closing Date		1.2
Code		2.13
Company Board		4.2(g)
Company Common		4.2(a)
Company Option		2.3
Company Plan		2.3
Company Returns		4.11(b)
Company Share		2.2(c)
Confidentiality Agreement		7.3
Contract		4.5
DGCL		1.1
Disclosure Schedule		ARTICLE IV
Effective Time		1.3
Employee Plans		4.12(a)
Environmental Laws		4.10(a)
ERISA		4.12(a)
Escrow Agreement		8.2(c)
Escrow Cash		2.1(h)
Escrow Fund		9.2(a)
Escrow Period		9.2(b)
Exchange Ratio		2.1(i)
Expiration Date		9.1
Financial Statements		4.7
GAAP		2.1(j)
Hazardous Substances		4.10(a)

		Cross Reference in
Term		Agreement
Indebtedness		6.1(l)
Information Statement		10.1(f)
JAMS		9.2(i)(ii)
knowledge of the Company		4.13
Legal Proceedings		4.15
Legal Requirements		4.5
Loss		9.2(a)
Losses		9.2(a)
Nasdaq		2.1(c)
Officer’s Certificate		9.2(g)
Parent Common		2.1(c)
Parent Disclosure Schedule		ARTICLE V
Permits		4.14
Person		2.12
pro rata interest		9.2(a)
Properties		4.9(b)
Proprietary Rights		4.18(b)
Related Agreements		4.4
Representatives		6.2(a)
SEC		2.14
Securities Act		2.14
Subsidiary		4.5
Surviving Corporation		1.1
Takeover Statutes		4.23
Target Net Working Capital Amount		2.1(d)
Tax		4.11(a)
Taxable		4.11(a)
Taxes		4.11(a)
Taxing Authority		4.11(a)
Term Sheet		7.4
Third Party Claim		9.2(k)
Threshold		9.2(a)
Unaudited Financial Statements		4.7
Vesting Determination Date		2.6(c)
Voting Debt		4.2(c)

AGREEMENT AND PLAN OF MERGER

     THIS AGREEMENT AND PLAN OF MERGER (this “Agreement”), is dated as of the 9^th day of January, 2006, by and among PEOPLESUPPORT, INC., a Delaware corporation (“Parent”), RT ACQUISITION CORPORATION, a Delaware corporation and a wholly-owned subsidiary of Parent (“Merger Sub”), RAPIDTEXT, INC., a Delaware corporation (the “Company”), and all of the Company’s stockholders (the “Stockholders”).

W I T N E S S E T H:

     WHEREAS, the Boards of Directors of Parent, Merger Sub and the Company deem it advisable and in the best interests of their respective stockholders to effect the merger hereafter provided for, in which Merger Sub would merge with and into the Company, and the Company would become a wholly-owned subsidiary of Parent (the “Merger”); and

     WHEREAS, pursuant to the Merger, among other things, all of the issued and outstanding common stock, options and warrants of the Company will be converted into the right to receive the consideration upon the terms and conditions set forth herein; and

     WHEREAS, the Company and the Stockholders, on the one hand, and Parent and Merger Sub, on the other hand, desire to make certain representations, warranties, covenants and other agreements in connection with the Merger; and

     WHEREAS, as a condition and an inducement to the willingness of Parent and Merger Sub to enter into this Agreement, the Stockholders have agreed to vote the shares of Company capital stock owned by them in favor of the Merger, and the Stockholders have agreed to indemnify Parent and Merger Sub for the representations, warranties and covenants regarding the Company set forth herein;

     NOW, THEREFORE, in consideration of the premises and of the mutual agreements, provisions and covenants herein contained, Parent, Merger Sub, the Company and the Stockholders hereby agree as follows:

ARTICLE I

THE MERGER

     1.1 The Merger. At the Effective Time (as defined in Section 1.3 hereof), upon the terms and subject to the conditions of this Agreement, Merger Sub will be merged with and into the Company in accordance with the General Corporation Law of the State of Delaware (the “DGCL”), whereupon the separate existence of Merger Sub will cease, and the Company will be the surviving corporation (the “Surviving Corporation”) and will be a wholly-owned subsidiary of Parent.

     1.2 Closing. The closing of the transactions contemplated by this Agreement (the “Closing”) will take place at the offices of Pillsbury Winthrop Shaw Pittman LLP, 650 Town Center Drive, Costa Mesa, California, as soon as practicable following satisfaction or waiver of all of the conditions to the obligations of the parties to consummate the transactions

contemplated hereby in accordance with this Agreement or at such other time, place and date as is mutually agreed to by the parties hereto. The date of the Closing is referred to in this Agreement as the “Closing Date.” The Closing Date is scheduled to be January 9, 2006.

     1.3 Effective Time. As soon as practicable after satisfaction or, to the extent permitted hereunder, waiver of all conditions to the Merger, the Company and Merger Sub will file a certificate of merger (the “Certificate of Merger”) with the Secretary of State of the State of Delaware and make all other filings or recordings required by the DGCL in connection with the Merger. The Merger will become effective at such time as the Certificate of Merger is duly filed with the Secretary of State of the State of Delaware or at such later time as is specified in the Certificate of Merger (the “Effective Time”).

     1.4 Corporate Organization. At and after the Effective Time, the Surviving Corporation will possess all the rights, privileges, powers and franchises and be subject to all of the restrictions, liabilities and duties of the Company and Merger Sub, all as provided under the DGCL and the Domicile Law.

ARTICLE II

EFFECT OF THE MERGER ON THE

CAPITAL STOCK OF THE CONSTITUENT CORPORATIONS

     2.1 Definitions. The following definitions will be applicable for this ARTICLE II (and any capitalized terms not defined in this subsection have the meaning ascribed to them elsewhere in this Agreement):

          (a) “Aggregate Common Number” means the aggregate number of shares of common stock of the Company outstanding immediately prior to the Effective Time (including all shares of Company common stock issued or issuable upon exercise, conversion or exchange of all unvested and vested Company Options outstanding immediately prior to the Effective Time that do not terminate or expire unexercised, unexchanged or unconverted as of the Effective Time).

          (b) “Aggregate Purchase Price” means $9,750,000, which consists of the Cash Consideration and the Stock Consideration, and is subject to adjustment as provided herein.