IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY

MEMORANDUM OF UNDERSTANDING
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WHEREAS, there is now pending a putative class action lawsuit in
the Court of Chancery of the State of Delaware in and for New Castle County
(the "Court") styled Annette Roti v. Official Payments Corporation, et al.,
CA No. 19707 (the "Action"), purportedly brought on behalf of a class
comprised of the common stockholders of Official Payments Corporation
("OPC" or the "Company") other than Defendants and their affiliates (the
"Class") against Defendants OPC, Andrew Cohan, Thomas R. Evans, John R.
Haggerty, John D. Lewis, Lee E. Mikles, Bruce S. Nelson, Tier Technologies,
Inc. ("Parent") and Kingfish Acquisition Corporation, a wholly-owned
subsidiary of Tier ("Purchaser") (collectively "Defendants").

WHEREAS, Plaintiff's Complaint was filed on June 19, 2002
(hereinafter, the "Complaint");

WHEREAS, the Complaint challenges a stockholder agreement between
Parent and certain OPC stockholders (the "Stockholder Agreement") and a
merger agreement (the "Merger Agreement) announced on May 31, 2002 between
Parent and OPC, pursuant to which, subject to certain conditions: (i)
Parent would conduct a tender offer (the "Tender Offer") to acquire any and
all of the outstanding shares of Common Stock of OPC for $3.00 per share,
and (ii) Purchaser thereafter will merge with and into OPC, pursuant to
which all shares of OPC common stock not theretofore purchased or as to
which appraisal rights have not properly been demanded will be converted to
the right to receive $3.00 in cash per share, Purchaser will discontinue
its separate existence and OPC will become a wholly-owned subsidiary of
Parent (the "Merger");

WHEREAS, the Complaint alleges, among other things, that: (i)
Defendants failed to disclose certain allegedly material information in its
14D-9 statement; and (ii) Defendants Parent and Purchaser are prohibited by
8 Del. C. ss. 203 from affecting a business combination with OPC for three
years without first obtaining the affirmative vote of 66-2/3% of OPC's
disinterested stockholders.

WHEREAS, plaintiff seeks to enjoin consummation of the Tender Offer;

WHEREAS, Defendants OPC, and Parent and Purchaser, submitted
letters in opposition to the Complaint and plaintiff's motion for expedited
proceedings;

WHEREAS, plaintiff's counsel and Defendants' counsel engaged in
arm's-length negotiations concerning a possible settlement of the Action;

WHEREAS, Defendants maintain that no supplemental disclosures in
connection with the Tender Offer or Merger are required and maintain that
they have committed no breaches of fiduciary duties or disclosure
violations whatsoever, and maintain that plaintiff's claims under 8 Del. C.
ss. 203 do not have merit;

WHEREAS, counsel for the parties have reached an agreement in
principle providing for the settlement of the Action between and among
plaintiff, on behalf of herself and the putative Class, and Defendants, on
the terms and subject to the conditions set forth below (the "Settlement")

NOW THEREFORE, as a result of the foregoing and the negotiations
among counsel to the parties, the parties to the Action have agreed in
principle as follows:

1. Amendment to the Tender Offer. Defendants maintain that they
are not required to issue any supplemental disclosures and that they have
committed no breaches of fiduciary duties related to price, disclosure or
otherwise. Nevertheless, solely in order to settle and resolve this matter,
Defendants shall amend the 14D-9 Statement by filing with the SEC an
amendment to the 14D-9 (the "Amendment") and shall deliver the Amendment to
stockholders by regular mail, as soon as practicable, which Amendment shall
be substantially in the form of Exhibit A hereto. The parties, having
considered Exhibit A, agree that the Amendment as filed together with the
additional information contained in the 14D-9 or incorporated therein by
reference will fairly, reasonably and completely disclose all material
information necessary and sufficient to enable OPC shareholders to make an
informed decision.

2. Discovery. The parties have agreed to cooperate in such
discovery, if any, as is reasonably necessary to confirm the fairness and
adequacy of the Settlement contemplated herein, including the production of
additional relevant documents and an individual or individuals for
interview. Production of documents will be conducted pursuant to a
Confidentiality Agreement, the terms of which shall be agreed upon by the
parties at a future date. The Settlement shall be subject to completion by
plaintiff of confirmatory discovery in the Action reasonably satisfactory
to plaintiff's counsel.

3. Stipulation of Settlement. The parties to the Action will agree
upon and execute a Stipulation of Settlement (the "Stipulation") and such
other documentation as may be required in order to obtain Final Court
Approval (as defined below) of the settlement described herein (the
"Settlement Documents"). The Stipulation will expressly provide, inter
alia, for certification of a non-opt out settlement class pursuant to
Delaware Court of Chancery Rules 23(b)(1) and (b)(2) of holders of Common
Stock and their successors in interest and transferees, immediate and
remote, from May 31, 2002 through and including the effective date of the
Merger; for entry of a judgment dismissing the Action with prejudice and
without costs; for a complete release and settlement of all past, present
or future claims, rights, causes of actions, suits, matters and issues,
known or unknown, liquidated or non-liquidated, contingent or absolute,
state, federal or foreign, pursuant to statute, rule, regulation, common
law or civil law, whether direct, indirect, individual, class, derivative,
representative, legal, equitable or any other type, other than statutory
appriaisal rights, against Defendants or any of their families, parent
entities, affiliates, subsidiaries, predecessors, successors or assigns,
and each and all of their respective past, present or future officers,
directors, associates, stockholders, members, managers, controlling
persons, representatives, employees, attorneys, financial or investment
advisors, consultants, accountants, investment bankers, commercial bankers,
engineers, advisors or agents, heirs, executors, trustees, general or
limited partners or partnerships, personal representatives, estates or
administrators, which have been, or could have been, asserted relating to
the Action, the Tender Offer, the Stockholder Agreement, the Merger, the
Merger Agreement, and any related transaction (collectively the
"Transaction"), the actions of Defendants relating to the Transaction, the
related disclosure materials, disclosures, facts and allegations that are
or could (insofar as such transactions, disclosures, facts and allegations
relate to, or occurred in connection with, the subject matter of the
Action) be the subject of the Action or of an action in any federal, state,
arbitration or any other tribunal or forum including any claims arising
under federal, state or common law, including the federal securities laws;
that Defendants have denied and continue to deny that they have committed
or attempted to commit any violations of law or breaches of duty of any
kind; that Defendants are entering into the Stipulation solely because the
proposed Settlement would eliminate the burden, risk and expense of further
litigation, and is in the best interests of OPC and all its shareholders;
and that in the event that any claims related to the Transaction or the
subject matter of the Action (whether direct, derivative or otherwise) are
commenced against any person in any forum, state court, federal court,
arbitration or otherwise prior to Final Court Approval of the Settlement,
the parties agree to use their good faith efforts to obtain the dismissal
or stay in contemplation of dismissal of any such action.

4. Intention of the Parties. It is the intention of the parties to
extinguish all such settled claims and consistent with such settled claims
and consistent with such intentions, the releasing parties waive their
rights to the extent permitted by state law, federal law or principle of
common law, which may have the effect of limiting the release set forth above.

5. Notice and Court Approval. Subject to prior Court approval of
the Stipulation and the form of the Settlement Documents, the parties to
the Action will present the Settlement Documents to the Delaware Court of
Chancery for approval as soon as practicable following appropriate notice
of the proposed Settlement. Plaintiff shall take reasonable steps to file
the Stipulation with the Delaware Court of Chancery no later than July 15,
2002. As used herein, "Final Court Approval" of the Stipulation means that
the Delaware Court of Chancery has entered an order approving the
Stipulation and that such order is finally affirmed on appeal or is no
longer subject to appeal and the time for any petition for rearguments,
appeal or review, by certiorari or otherwise, has expired. Plaintiff's
counsel intend to apply to the Delaware Court of Chancery for an award of
attorneys' fees and reasonable out-of-pocket disbursements. Subject to the
terms and conditions of this Memorandum of Understanding and the
contemplated Stipulation, Plaintiffs' counsel will apply for an award of
fees and expenses in an aggregate amount not exceeding $175,000, which
Defendants will not oppose, to be paid by Defendants to Prickett, Jones &
Elliot, if approved by the Court, within 10 days after the later of (i) the
effective date of the Merger; and (ii) Final Court Approval. Approval of
such fee application shall not be a condition to settlement. No such fees
or expenses shall be payable in the absence of Final Court Approval.

6. Return of Documents. Within 15 days after Final Court Approval,
plaintiff's counsel, consistent with the terms of a Confidentiality
Agreement, the terms of which shall be agreed upon by the parties at a
future date, shall return to the producing party all discovery material
produced in the Action by any defendant or third party, and shall not
retain any copies or extracts thereof.

7. Termination. This Memorandum of Understanding and the
Settlement Documents are not intended to create any obligation for Parent
or Purchaser to consummate the Transaction and shall not modify in any way
Parent or Purchaser's rights or obligations under any of the Transaction
documents. This Memorandum of Understanding and the Settlement Documents
shall be null and void and of no force and effect if: (a) the Merger
Agreement is terminated and the Tender Offer or Merger are abandoned; or
(b) the Settlement does not obtain Final Court Approval for any reason. In
such event, this Memorandum of Understanding shall not be deemed to
prejudice in any way the positions of the parties with respect to the
Action, shall be the subject of Rule 408 of the Delaware Rules of Evidence,
and shall not entitle any party to recovery of any costs or expenses
incurred in connection with the implementation of the Memorandum of
Understanding.

8. Interim Stay of The Actions. The parties to the Action agree
that, except as expressly provided herein, the Action shall be stayed
pending submission of the proposed Settlement to the Court for its
consideration. Plaintiff's counsel agrees that the Defendants' time to
move, answer or otherwise respond to the Complaint and to respond to any
discovery propounded is extended without date. No defendant waives any
defense based on lack of personal jurisdiction, insufficiency of process or
insufficiency of service of process by reason of entry into this Memorandum
of Understanding or execution of the Settlement Documents and presentation
thereof to the Court. Counsel shall enter into such additional
documentation if any as shall be required to effectuate the foregoing
agreements.

9. Counterparts. This Memorandum of Understanding may be executed
in counterparts by any of the signatories hereto, including by telecopier,
and as so executed shall constitute one agreement.

10. Governing Law. This Memorandum of Understanding and the
Settlement contemplated by it shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without regard to
Delaware's conflict of law rules.

11. Amendments. This Memorandum of Understanding may be modified
or amended only by a writing signed by all the signatories hereto.

12. Successors. This Memorandum of Understanding shall be binding
upon and inure to the benefit of the parties and their respective agents,
executors, heirs, successors and assigns.

IN WITNESS WHEREOF, the parties have executed this Memorandum
effective as of June 26, 2002:

OF COUNSEL: /s/ Ronald A. Brown, Jr.
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Ronald A. Brown, Jr.
Susman & Watkins Prickett, Jones & Elliott
Two First National Plaza, Suite 600 1310 King Street, P.O. Box 1328
Chicago, Illinois 60603 Wilmington, Delaware 19899

Attorney for Plaintiff

/s/ Karen P. Kimmey
OF COUNSEL: ----------------------------------------
Karen P. Kimmey
The Bayard Firm Farella Braun & Martel, LLP
222 Delaware Avenue, Suite 900 Russ Building, 30th Floor
Wilmington, Delaware 19899 235 Montgomery Street
San Francisco, California 94104

Attorney for Defendants Tier Technologies,
Inc. and Kingfish Acquisition Corporation

/s/ Edward P. Welch
----------------------------------------
Edward P. Welch
Edward B. Micheletti
Skadden, Arps, Slate, Meagher & Flom LLP
One Rodney Square
P.O. Box 636
Wilmington, Delaware 19899-0636

Attorney for Defendants Official Payments
Corporation, Andrew Cohan, Thomas R.
Evans, John R. Haggerty, John D. Lewis,
Lee E. Mikles, and Bruce S. Nelson