Common use of Capital Stock and Related Matters Clause in Contracts

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there are no statutory or, to the best of the Company's knowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.

Capital Stock and Related Matters. (i) As of the Closing Date, and immediately thereafterafter giving effect to the transactions contemplated hereby and pursuant to the Related Documents, (i) the authorized capital stock of the Company shall will consist of a total of 50,000,000 shares as follows: (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 2,100,572 shares of Common Stock, par value $.001 per share, of which 10,040,000 6,741,413 shares shall be are issued and outstanding, 2,042,986 shares of which are reserved for issuance upon the exercise of the Warrants, and 6,387,160 shares of which are reserved for issuance to holders of Warrants and options; (b) 25,000,000 shares of Preferred Stock, par value $.001 per share, of which 3,600 shares have been designated Series A Preferred Stock (2,000 shares of which are issued and outstanding and 2,500,000 of which 15,000 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the have been designated Series B Preferred Stock (15,000 shares of which are issued and 3,000,000 outstanding); (ii) all issued and outstanding shares shall be reserved for issuance upon conversion have been duly and validly issued, fully paid and non-assessable; (iii) no shares of capital stock of the Series C Preferred. As Company will be owned or held by or for the account of the ClosingCompany or any of its Subsidiaries; (iv) except as set forth on Schedule 10C, neither the Company nor any Subsidiary shall of the Guarantors will have outstanding any stock or securities convertible into or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights (either preemptive or options other) to subscribe for or to purchase, or any options for the purchase its of, or any agreements providing for the issuance (contingent or otherwise) of, or any calls, commitments or claims of any other character relating to the issuance of, any capital stock stock, or any stock or securities convertible into or exchangeable for its any capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and stock; (v) except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing10C, neither the Company nor any Subsidiary shall of the Guarantors will be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, warrants or options or other rights to acquire purchase shares of its capital stock, ; (vi) except as set forth on Schedule 10C, neither the Capitalization Schedule. As Company nor any of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. Guarantors is a party to any agreement (ii) Except as shall have been waived prior to the Closing, there are no statutory or, to the best of the Company's knowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunderother than this Agreement, the issuance of Securityholders Agreement and the Common Stock upon conversion of Registration Rights Agreement) restricting the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance transfer of any shares of its capital stock, ; and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, (vii) except as set forth in on Schedule 10C and except for the Capitalization ScheduleCommon Stock of the Company, neither the Company nor any of the Guarantors will have filed or be required to file, pursuant to Section 12 of the Exchange Act, a registration statement relating to any class of debt or equity securities as of the date hereof.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 100,000,000 shares of Common Stock, of which 10,040,000 76,049,301.77 shares shall be issued and outstanding; (b) 350,000 shares of Series A-1 Preferred Stock, of which 337,582.50 shares shall be issued and outstanding and 2,500,000 (c) 95,000 shares of Series A-2 Preferred Stock, of which 20,000 shares shall be reserved for issuance upon conversion issued and outstanding. The attached Capitalization Schedule sets forth the ownership of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion Company as of and ----------------------- immediately after the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C PreferredClosing. As of the Closing, neither the Company nor any Subsidiary shall not have outstanding (or any commitments to issue) any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall not be subject to ----------------------- any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, stock except as set forth on pursuant to the Capitalization ScheduleExecutive Stock Agreements and the Investor Rights Agreement. As of the Closing, all All of the outstanding shares of the Company's capital stock are, and as of the Closing shall be be, validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's actual knowledge, contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Stock hereunder or any other capital stock or other securities of the Warrants hereunderCompany, except as set forth in the Investor Rights Agreement. Based upon the representations and warranties of the Purchasers set forth herein, and to the Company's knowledge, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stockstock or other securities, and the offer, sale and issuance of the Series C Preferred or the Warrants Stock hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's actual knowledge, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in for the Capitalization ScheduleInvestor Rights Agreement and Executive Stock Agreements between the Company and certain of its executives. The Company has not granted any registration rights other than under the Investor Rights Agreement .

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 9,720,260 shares of preferred stockStock, of which 2,000 96,200 shares shall be designated as Series A Preferred (the "Series Class A Preferred") (, all of which 2,000 shall be reserved for issuance to the Purchasers pursuant to Section 1B(b) hereof, and of which 9,624,060 shares shall be designated as Common Stock (1,760,000 of which shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (6,600,000 of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion to the Purchasers pursuant to Section 1B(b) hereof, 760,000 of the Series A Preferred, 5,000,000 shares which shall be reserved for issuance upon conversion issuances to future senior management, 480,000 of the Series B Preferred and 3,000,000 shares which shall be reserved for issuance upon conversion issuances to other future management, and 24,060 of the Series C Preferredwhich shall be reserved for future issuances to Xxxxxxxx & Struggles. As of the Closing, neither the Company nor any Subsidiary shall not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred plans other than pursuant to and as contemplated by this Agreement and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration dateManagement Agreement. As of the Closing, neither the Company nor any Subsidiary shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on pursuant to this Agreement, the Capitalization ScheduleManagement Agreement and the Company's Certificate of Incorporation. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Stock hereunder or the Warrants hereunder, the issuance of the Common Stock upon conversion pursuant to Section 1B(b), except as expressly contemplated in the Shareholders Agreement or provided herein . Based in part on the investment representations of the Series C Preferred or upon exercise Purchasers in Section 7C hereof and of the Warrants. The Executive in Section 1(d) of the Management Agreement, the Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder Stock here under and pursuant to Section 1B(b) hereof do not and will not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in for the Capitalization ScheduleStockholders Agreement, the Management Agreement and the Registration Agreement.

Capital Stock and Related Matters. (i) As At the time of the Closing ---------------------------------- and immediately thereafterafter giving effect to the transactions contemplated by this Agreement, the authorized capital stock of the Company shall will consist of (a) 15,000,000 500,000 shares of preferred common stock, of which 2,000 113,228 shares shall will be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 50,000 shares shall will be reserved for issuance upon conversion exercise of the Series Warrants. Attached as EXHIBIT A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion is a --------- true and correct list identifying each stockholder of the Series B Preferred Company and 3,000,000 the number of shares shall be reserved for issuance upon conversion of Common Stock owned by each such stockholder. All of the Series C Preferredoutstanding shares of Common Stock will be validly issued and outstanding, fully paid and non-assessable. As of Except for the ClosingWarrants, neither the Company nor any Subsidiary shall have has no outstanding any stock or securities convertible into or exchangeable for any shares of its capital stock Capital Stock, or containing any profit participation features, nor shall it have outstanding any rights (either preemptive or options other) to subscribe for or to purchase, or any outstanding options for the purchase its capital stock of, or any agreements providing for the issuance (contingent or otherwise) of, or any outstanding calls, commitments or claims of any character relating to, any Capital Stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire Capital Stock of the Company's capital stock: . Except as provided in the holderWarrants, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock Capital Stock or any warrantsconvertible securities, rights or options or other rights to acquire its capital stockof the type described in the preceding sentence. The Company is not a party to, and does not have knowledge of, any agreement (except as set forth on in this Agreement, the Capitalization Schedule. As Letter Agreement, the Warrants, the Shareholders' Agreement [as defined in a certain Note and Warrant Purchase Agreement dated December 21, 1990 by and between Purchaser and the Company] and Restricted Stock Award Agreements dated December 21, 1990 between the Company and Xxxxxx XxXxx and the Company and Xxxx Xxxxxxx and the Company) restricting the voting or transfer of the Closing, all of the outstanding any shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there are no statutory or, to the best of the Company's knowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsCapital Stock. The Company is not required to file, nor has not violated any applicable federal or state securities laws in connection with the offerit filed, sale or issuance of any of its capital stock, and the offer, sale and issuance pursuant to Section 12 of the Series C Preferred or the Warrants hereunder do not require Exchange Act, a registration statement relating to any class of equity securities, provided, however, that --------- -------- under the Securities Act or any applicable state securities laws. To the best Shareholders' Agreement, certain shareholders of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization ScheduleCompany have been granted "piggy-back" registration rights.

Capital Stock and Related Matters. (i1) As of Immediately prior to the Closing and immediately thereafterClosing, the authorized capital stock of the Company shall consist of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 400,000,000.00 shares of Common Stock, of which 10,040,000 70,839,784.83 shares shall be issued and outstanding; (b) 350,000.00 shares of Series A Preferred, of which 329,127.50 shares shall be issued and outstanding, (c) 142,500.00 shares of Series B Preferred, of which 104,080.57 shares shall be issued and outstanding and 2,500,000 (d) 7,500.00 shares of Series C Preferred, of which 5,477.92 shares shall be reserved for issuance upon conversion issued and outstanding. The attached Capitalization Schedule sets forth the ownership of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of Company immediately prior to the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C PreferredClosing. As of the Closing, neither the Company nor any Subsidiary shall not have outstanding (or any commitments to issue) any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth or as contemplated by this Agreement or the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number Proposed Terms of shares covered, the exercise price and the expiration dateRestructuring. As of the Closing, neither the Company nor any Subsidiary shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except pursuant to the Executive Stock Agreements and the Investor Rights Agreement or as set forth on contemplated by this Agreement or the Capitalization ScheduleProposed Terms of Restructuring. As of the Closing, all All of the outstanding shares of the Company's capital stock are, and as of the Closing shall be be, validly issued, fully paid and nonassessable. (ii2) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's actual knowledge, contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Purchased Equity hereunder or any other capital stock or other securities of the Warrants hereunderCompany, except as set forth in the Investor Rights Agreement. Based upon the representations and warranties of the Purchasers set forth herein, and to the Company's knowledge, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stockstock or other securities, and the offer, sale and issuance of the Series C Preferred or the Warrants Purchased Equity hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's actual knowledge, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in for the Capitalization ScheduleInvestor Rights Agreement and Executive Stock Agreements. The Company has not granted any registration rights other than under the Investor Rights Agreement.

Capital Stock and Related Matters. (i) As The authorized capital stock of the Closing Company consists of 100,000,000 shares of capital stock, consisting of 90,000,000 shares of Common Stock, par value $.001 per share, and immediately thereafter10,000,000 shares of Preferred Stock, par value $.001 per share, of which 4,250,000 are designated as Series A Convertible Preferred Stock, par value $.001 per share. Immediately prior to the Closing, the authorized capital stock of the Company shall consist of (a) 15,000,000 100,000,000 shares of preferred capital stock, consisting of 90,000,000 shares of Common Stock, par value $.001 per share, and 10,000,000 shares of Preferred Stock, par value $.001 per share, of which 2,000 shares 4,250,000 shall be designated as Series A Convertible Preferred (the "Series A Preferred") (Stock, par value $.001 per share, and of which 2,000 shares shall be issued and outstanding), 5,000,000 5,110,000 shares shall be designated as Series B Convertible Preferred (Stock, par value $.001 per share. The Company has, and immediately prior to the Closing shall have, 15,305,000 shares of which 4,107,044 Common Stock and 4,000,000 shares shall be of Series A Convertible Preferred Stock issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be . Except for such issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion of the Series A Preferredshares, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the Closing, neither the Company nor any Subsidiary shall does not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall does it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plansplans other than pursuant to, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." contemplated by, this Agreement. The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall is not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options options, or other rights to acquire its capital stock, except as set forth on the Capitalization Schedulepursuant to this Agreement and its Certificate of Incorporation. As of the Closing, all All of the outstanding shares of the Company's capital stock are and shall be validly issued, fully paid paid, and nonassessable. (ii) Except as shall have been waived prior to set forth in the ClosingStock Purchase Agreement by and between WCO-Nevada and Interprise dated March 30, 1999, there are no statutory or, to the best of the Company's knowledge, or contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of any of the Series C Preferred or the Warrants Stock hereunder, except as expressly provided herein. Based in part on the issuance investment representations of the Common Stock upon conversion of Purchasers in Section 7C hereof, the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale sale, or issuance of any of its capital stock, and the offer, sale sale, and issuance of the Series C Preferred or the Warrants Stock hereunder do does not and will not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there There are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock (or in the case of preferred shares, designated), issued and outstanding shares of beneficial interest of the Company shall consist of (a) 15,000,000 shares 100,000,000, 15,692,614 and 15,692,614 Common Shares (plus any Common Shares issued in exchange for common units of preferred stockthe Operating Partnership pursuant to Section 8.6 of the Amended and Restated Agreement of limited partnership of the Operating Partnership, dated as of November 17, 1997), respectively, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares Shares shall be reserved for issuance upon conversion exchange of the Exchangeable Note and exercise of the Warrants, (b) 2,000,000, 2,000,000 and 2,000,000 Series A PreferredShares, 5,000,000 shares shall be reserved for issuance upon conversion respectively, and (c) 4,000,000, 4,000,000 and 4,000,000 shares, respectively, of the Company's Series B Cumulative Redeemable Preferred and 3,000,000 shares shall be reserved for issuance upon conversion Shares of Beneficial Interest. As of the Series C PreferredClosing and immediately thereafter, the authorized, issued and outstanding partnership interests of the Operating Partnership (other than units held by the Company) shall consist of 11,057,485. As of the Closing, neither the Company Company, the Operating Partnership nor any Subsidiary shall have outstanding any stock Capital Stock or securities convertible or exchangeable for any shares of its capital stock Capital Stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock Capital Stock or any stock or securities convertible into or exchangeable for its capital stock Capital Stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and Exchangeable Note, the Warrants Warrants, and except as set forth in the first sentence of this Section 4B(i) or on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company Company, the Operating Partnership nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock Capital Stock or any warrants, options or other rights to acquire its capital stockCapital Stock, except as set forth on the Capitalization Schedule. As of the Closing, all of the Company's outstanding shares Capital Stock shall be validly issued, fully paid and nonassessable. When issued pursuant thereto, the Common Shares issuable upon exercise of the Company's capital stock shall Warrants and exchange of the Exchangeable Note will be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory oror contractual preemptive rights, to the best rights of the Company's knowledge, contractual shareholders' preemptive rights refusal or rights of refusal first offer with respect to the issuance of the Series C Preferred or the Warrants Securities hereunder, the issuance of the Common Stock Shares upon conversion exchange of the Series C Preferred Exchangeable Note or upon exercise of the Warrants, or the Transactions contemplated hereby. The Company has not violated any applicable federal or state securities laws Assuming the accuracy of the Lender's representations set forth in connection with the offerSection 7C(i), sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred Securities hereunder, the Common Shares upon exchange of the Exchangeable Note or upon exercise of the Warrants hereunder Warrants, and the Transactions contemplated hereby do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's or any Subsidiary's knowledge, there are no agreements between the holders of the Company's shareholders or any Subsidiary's Capital Stock with respect to the voting or transfer of the Company's capital stock or any Subsidiary's Capital Stock or with respect to any other aspect of the Company's or any Subsidiary's affairs, except as set forth on the Capitalization Schedule. Except as disclosed in the Capitalization Schedule, the Company is not a party to any agreement providing for Persons to be elected or appointed to its Board of Trustees.

Capital Stock and Related Matters. (i) As of immediately prior to the Closing and immediately thereafterClosing, the authorized capital stock of the Company shall consist of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion each of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion Companies is as set forth on Schedule 2B(i) attached hereto. The Shares constitute all of the Series B Preferred outstanding capital stock of Auburn and 3,000,000 shares shall as of immediately prior to the Closing will be reserved for issuance upon conversion held beneficially and of record by each Seller (free and clear of all Encumbrances) as set forth on Schedule 2B(i) attached hereto. Schedule 2B(i) sets forth the capitalization of each of the Series C Preferred. As Companies and the name of each Person holding any equity securities of such Company, any securities convertible or exchangeable for any equity securities of such Company and any options or other rights to purchase equity securities of such Company and the amount and type of such securities, options or rights held by such Persons as of the Closing, neither Closing Date and immediately thereafter. Neither of the Company nor any Subsidiary shall have Companies has outstanding (1) any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding (2) any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or (3) any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration dateor similar plans or rights. As Neither of the Closing, neither the Company nor any Subsidiary shall be Companies is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the ClosingClosing and immediately thereafter, all of the outstanding shares of the Company's Companies' capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there are no statutory or, to the best Neither of the Company's knowledge, contractual shareholders' preemptive rights or rights Companies has received written notice of refusal with respect to the issuance any violation and is not otherwise aware of the Series C Preferred or the Warrants hereunder, the issuance any violation of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws laws, whether of the United States or otherwise, in connection with the offer, sale or issuance of any of its capital stock, and stock or the offer, sale and or issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities lawsof its debt securities. To the best of the Company's knowledge, there There are no agreements between any of the Company's Companies' shareholders or with any other Person with respect to the voting voting, transfer or transfer registration of any of the Company's Companies' capital stock or with respect to any other aspect of any of the Company's affairs, Companies' affairs that will survive the Closing Date (other than this Agreement and except as set forth provided in the Capitalization ScheduleSchedule 2B(ii) attached hereto).

Capital Stock and Related Matters. (ia) As of the Closing and immediately thereafter, the The authorized capital stock of the Company shall consist consists of Two Hundred Twenty Million (a220,000,000) 15,000,000 shares, consisting of Twenty Million (20,000,000) shares of preferred stock, $0.01 par value, none of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be is issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and Two Hundred Million (b200,000,000) 80,000,000 shares of Common Stockcommon stock, $0.01 par value, of which 10,040,000 45,932,253 shares shall be were issued and outstanding and 2,500,000 as of July 20, 2017, including 334,902 shares shall be of Company Common Stock granted in respect of outstanding restricted shares of Company Common Stock. Except for 1,175,100 shares of the Company Common Stock reserved for issuance upon conversion the exercise of outstanding the Company Stock Options, there are no outstanding subscriptions, options, warrants, puts, calls, rights, exchangeable or convertible securities or other commitments or agreements obligating the Company to issue, transfer, sell, purchase, redeem or otherwise acquire any Company Common Stock. No bonds, debentures, notes or other indebtedness that have the right to vote on any matters on which shareholders of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion Company may vote are issued or outstanding. No trust preferred or subordinated debt securities of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C PreferredCompany are issued or outstanding. As of the Closing, neither the The Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the Closing, all All of the outstanding shares of the Company's capital stock shall be Company Common Stock are validly issued, fully paid and nonassessable, and such shares were not issued in violation of any preemptive rights. (iib) The Company does not have any Subsidiaries except as set forth on Schedule 8.3. Except as shall have been waived prior to set forth on Schedule 8.3, the ClosingCompany (or a Company Subsidiary) owns, there are no statutory orfree and clear of any Liens, to the best all of the Company's knowledge, contractual shareholders' preemptive rights issued and outstanding equity interests in each of such Subsidiaries. No Company Subsidiary has any outstanding stock or rights of refusal with respect to the issuance of the Series C Preferred securities convertible into or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated exchangeable for any applicable federal or state securities laws in connection with the offer, sale or issuance of any shares of its capital stock, and the offernor does any have outstanding any subscriptions, sale and issuance options, warrants, puts, calls, rights, or other commitments or agreements obligating any Company Subsidiary to issue, transfer, sell, purchase, redeem or otherwise acquire its capital stock or any stock or securities convertible into or exchangeable into its capital stock. No Company Subsidiary is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock. All of the Series C Preferred or outstanding shares of each of the Warrants hereunder do Company Subsidiaries’ capital stock are validly issued, fully paid and non-assessable, and such shares were not require registration under the Securities Act or issued in violation of any applicable state securities lawspreemptive rights. To the best Except for such Subsidiaries of the Company's knowledge, there the Company does not own, directly or indirectly, any stock, partnership interest, membership interest or joint venture interest in, or any security issued by, any other Person except for publicly traded securities that do not represent an ownership interest greater than one percent (1%) of a class of securities of the subject company or shares held on behalf of customers in such customers’ accounts. There are no voting trusts, shareholder agreements, proxies or other agreements between in effect pursuant to which the Company's shareholders Company or any of the Company Subsidiaries has a contractual obligation with respect to the voting or transfer of the Company's Company Common Stock or other equity interests of the Company or its Subsidiaries. Other than the Company Restricted Stock Awards or the Company Stock Options, no equity-based awards (including any cash awards where the amount of payment is determined in whole or in part based on the price of any capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization ScheduleCompany or any of its Subsidiaries) are outstanding.

Capital Stock and Related Matters. (i) As of the Closing Date and immediately thereafter, the authorized capital stock of the Company shall IGI will consist of (ai) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 50,000,000 shares of Common Stock, Stock of which 10,040,000 9,585,645 shares shall be of Common Stock are issued and outstanding and 2,500,000 of which 1,907,543 shares shall be of Common Stock have been reserved for issuance upon conversion exercise of the Series A PreferredWarrants, 5,000,000 and (ii) 1,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred preferred stock of IGI, $0.01 par value, of which no shares are issued and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferredoutstanding. As of the ClosingClosing Date, neither the Company nor any Subsidiary shall IGI will not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall other than the Warrants and it will not have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plansstock, except for the Series C Preferred and other than the Warrants and except as set forth the warrants, options and other securities identified on the "Outstanding Options and Warrants Schedule" attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration datehereto. As of the ClosingClosing Date, neither the Company nor any Subsidiary shall IGI will not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth herein and the Charter Documents as in effect on the Capitalization Scheduledate hereof. As of the Closing, all of the outstanding shares of the CompanyIGI's capital stock shall will be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there . There are no statutory or, to the best of the Company's knowledge, or contractual shareholdersstockholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company IGI has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Securities hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there There are no agreements between the Companyamong IGI's shareholders stockholders with respect to the voting or transfer of the CompanyIGI's capital stock or with respect to any other aspect of the Company's affairs, except than as set forth in the Capitalization Schedulecontemplated herein.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 132,478,190.969 shares of preferred stockStock, of which 2,000 179,745.677 shares shall be designated as Series A Preferred Stock (the "Series A Preferred") (134,845.633 of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares 44,900.044 of which shall be reserved for issuance upon conversion pursuant to Section 1B(ii)), and of which 132,298,445.292 shares shall be designated as Common Stock (97,000,000 of which shall be issued and outstanding, and 3,000,000 of which shall be reserved for issuances pursuant to the Series A PreferredOption Plan, 5,000,000 shares and 32,298,445.292 shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferredpursuant to Section 1B(ii)). As of the Closing, neither the Company nor any Subsidiary shall not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred plans other than pursuant to and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration datecontemplated by this Agreement. As of the Closing, neither the Company nor any Subsidiary shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on pursuant to this Agreement and the Capitalization ScheduleCompany’s Certificate of Incorporation. As of the Closing, all of the outstanding shares of the Company's ’s capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's ’s knowledge, contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Stock hereunder or the Warrants hereunder, the issuance of the Common Stock upon conversion pursuant to Section 1B, except as expressly contemplated in the Stockholders Agreement or provided herein. Based in part on the investment representations of the Series C Preferred or upon exercise of Purchaser in Section 7C hereof, the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Stock hereunder and pursuant to Section 1B hereof do not and will not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's ’s knowledge, there are no agreements between the Company's shareholders ’s stockholders with respect to the voting or transfer of the Company's ’s capital stock or with respect to any other aspect of the Company's ’s affairs, except as set forth in for the Capitalization ScheduleStockholders Agreement, the Senior Management Agreements and the Registration Agreement.

Capital Stock and Related Matters. (i) As of the First Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 22,050,000 shares of preferred stock, of which 2,000 50,000 shares shall be designated as Series A 12% Cumulative Redeemable Senior Preferred Stock (the "Series A Preferred") (39,500 of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 22,000,000 shares shall be designated as Series C 12% Cumulative Redeemable Junior Preferred (Stock, 20,847,986 of which 1,307,190 shall be issued and outstanding), ) and (b) 80,000,000 30,000,000 shares of Common Stock, of which 10,040,000 10,492,014 shares shall be issued and outstanding and 2,500,000 1,113,051 shares shall be reserved for issuance upon conversion exercise of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferredwarrants. As of the First Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Class A Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the First Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization ScheduleSchedule and except pursuant to the Articles of Incorporation. As of the First Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. The 595,895 shares of Common Stock issuable upon exercise of all of the Warrants which may be purchased hereunder (if issued on the date hereof) represent 5% of the fully dilluted shares of Common Stock after giving effect to the issuance of any shares of Common Stock required under any agreement set forth on the Capitalization Schedule other than shares issuable upon conversion of any promissory note. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Class A Preferred or the Warrants hereunder, hereunder or the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Assuming the accuracy of each Purchaser's representations and warranties made hereunder, the Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Class A Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in on the Capitalization Schedule, there are no voting trusts or agreements, stockholders' agreements, pledge agreements, buy- sell agreements, rights of first refusal, contractual preemptive rights or proxies relating to any securities of the Company or any of its Subsidiaries (whether or not the Company or any of its Subsidiaries is a party thereto). Each Purchaser shall receive title to the Class A Preferred and the Warrants purchased by it hereunder free and clear of all taxes and Liens other than Liens created by such Purchaser.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of of: (a) 15,000,000 1,000,000 shares of preferred stock, of which 2,000 20,000 shares shall be designated as Series A Preferred Stock (the "Series A Preferred") (all of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 no other such shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 20,000,000 shares of Common Stock, of which 10,040,000 1,290,012 shares shall be issued and outstanding and 2,500,000 outstanding, 565,966 shares shall be reserved for issuance upon conversion exercise of the Series A PreferredWarrants, 5,000,000 424,474 shares shall be reserved for issuance upon conversion exercise of the Series B Preferred Warrants and 3,000,000 549,377 shares shall be reserved for issuance upon conversion exercise of other outstanding options and warrants to acquire the Series C PreferredCompany's Common Stock (as described below). As of the Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans or similar rights or plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization -------------- Schedule." The Capitalization Schedule accurately sets forth the following -------- ----------------------- information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization ScheduleSchedule and except pursuant to the Certificate of ----------------------- Designation. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there are no statutory or, to the best of the Company's knowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.

Capital Stock and Related Matters. (i) As The attached Capitalization Schedule accurately sets forth the following information with respect to the Company's capitalization as of the Closing date hereof and immediately thereafter, : (1) the authorized capital stock of the Company shall consist Company, (2) the number of (a) 15,000,000 shares of preferred stock, each class of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be capital stock issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (3) the number of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, each class of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be capital stock reserved for issuance upon exercise of options, warrants, convertible securities or other rights to acquire the Company's capital stock, (4) the name of each holder of capital stock and the amount of stock owned by each such holder and (5) with respect to all outstanding options, warrants and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price or conversion price, the vesting schedule and the expiration date, and all of the Series A Preferredagreements or understandings entered into by the Company in connection with the issuance thereof or, 5,000,000 shares shall be reserved for issuance upon conversion of if applicable, the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the Closingconversion, neither exchange or exercise thereof. (ii) Neither the Company nor any Subsidiary of its Subsidiaries shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither Neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the Closing, all All of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable, and the Class A Common Stock issuable upon conversion of the Series E Preferred Stock will, when issued, be duly authorized and validly issued, fully paid and nonassessable. (iiiii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C E Preferred Stock or the Warrants hereunder, Class A Common Stock Preferred Stock hereunder or the issuance of the Class A Common Stock upon conversion of the Series C E Preferred Stock or upon exercise of any of the Warrantsoutstanding options to acquire the Company Stock and the Company is not bound by any contractual pre-emptive rights or rights of first refusal except as expressly contemplated herein nor, to the knowledge of the Company, is any other Person. The Except as set forth on the Capitalization Schedule, the Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C E Preferred Stock or the Warrants Class A Common Stock hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledgeknowledge after due inquiry, except as expressly contemplated herein or as set forth on the Capitalization Schedule, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs. (iv) Upon issuance in accordance with the terms hereof, except as set forth in the Capitalization ScheduleSeries E Preferred Stock and the Class A Common Stock to be purchased hereunder will be duly and validly issued, fully paid, non-assessable and, and the Purchaser will have good and marketable title to such shares, free and clear of all liens, claims and encumbrances of any kind, other than (a) transfer restrictions hereunder and under the Transaction Documents (including Sections 6P and 6Q below), (b) transfer restrictions under federal and state securities laws and (c) liens, claims or encumbrances imposed due to the actions of the Purchaser.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 50,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Voting Common Stock, of which 10,040,000 15,548,692.4204 shares shall will be issued and outstanding outstanding, 1,813,037.6020 shares will be reserved, and 2,500,000 32,638,269.9776 shares shall will be reserved for issuance upon conversion authorized, unreserved and unissued; (b) 3,000,000 shares of the Nonvoting Common Stock will be authorized, of which 90,603.6022 will be issued and outstanding, and 2,909,396.3978 unreserved and unissued; (c) 2,000,000 shares of Preferred Stock, of which (1) 465,000 shares have been designated Series A PreferredCumulative Redeemable Preferred Stock, 5,000,000 none of which are issued and outstanding (2) 265,000 shares shall be reserved for issuance upon conversion of the have been designated Series B Cumulative Redeemable Preferred Stock, none of which are issued and 3,000,000 outstanding, and (3) 40,000 shares shall be reserved for issuance upon conversion of the have been designated Series C Preferred, of which 18,849.84110 will be issued and outstanding, and 21,150.15890 will be authorized, unreserved and unissued. As of the Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization ScheduleSchedule and except pursuant to the Certificate. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to contained in the ClosingAmended Stockholders Agreement and the Tagalong/Dragalong Agreement, there are no statutory or, to the best of the Company's knowledge, or contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance purchase and sale of the Series C Preferred Purchased Securities hereunder or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, offer and sale and issuance of the Series C Preferred or the Warrants Purchased Securities hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there There are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock, except for the Amended Stockholders Agreement, the Tagalong/Dragalong Agreement and certain stock or with respect options issued to any other aspect certain members of the Company's affairs, except as set forth in the Capitalization Schedulemanagement.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 120,000,000 shares of Common Stock, of which 10,040,000 76,049,301.77 shares shall be issued and outstanding; (b) 350,000 shares of Series A Preferred Stock, of which 337,582.50 shares shall be issued and outstanding, (c) 142,500 shares of Series B Preferred Stock, of which 84,985.56657 shares shall be issued and outstanding and 2,500,000 (d) 7,500 shares of Series C Preferred Stock, of which 4,472.92456 shares shall be reserved for issuance upon conversion issued and outstanding. The attached Capitalization Schedule sets forth the ownership of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion Company as of and ----------------------- immediately after the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C PreferredClosing. As of the Closing, neither the Company nor any Subsidiary shall not have outstanding (or any commitments to issue) any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the ----------------------- Company nor any Subsidiary shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, stock except as set forth on pursuant to the Capitalization ScheduleExecutive Stock Agreements and the Investor Rights Agreement. As of the Closing, all All of the outstanding shares of the Company's capital stock are, and as of the Closing shall be be, validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's actual knowledge, contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Purchased Stock hereunder or any other capital stock or other securities of the Warrants hereunderCompany, except as set forth in the Investor Rights Agreement. Based upon the representations and warranties of the Purchasers set forth herein, and to the Company's knowledge, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stockstock or other securities, and the offer, sale and issuance of the Series C Preferred or the Warrants Purchased Stock hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's actual knowledge, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in for the Capitalization ScheduleInvestor Rights Agreement and Executive Stock Agreements between the Company and certain of its executives. The Company has not granted any registration rights other than under the Investor Rights Agreement.

Capital Stock and Related Matters. (i) As of the Closing date hereof and immediately thereafterprior to giving effect to the transactions contemplated hereby, the authorized capital stock of the Company shall consist consists of (a) 15,000,000 75,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series Class A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 24,525,134 shares shall be are issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion are held of record by the Persons set forth on the attached Capitalization Schedule (free and clear of all Liens resulting from any agreement or other action of the Series A PreferredCompany, 5,000,000 except as set forth on the Capitalization Schedule); and 7,500,000 shares shall be reserved for issuance upon conversion of Class B Common Stock, of which 2,635,000 shares are issued and outstanding and are held of record by the Persons set forth on the Capitalization Schedule (free and clear of all Liens resulting from any agreement or other action of the Series B Preferred Company, except as set forth on the Capitalization Schedule). Except as set forth in the immediately preceding sentence or on the Capitalization Schedule and 3,000,000 shares shall be reserved for issuance upon conversion immediately prior to giving effect to the transactions contemplated hereby, the Company does not have and as of the Series C Preferred. As of the Closing, neither the Company nor any Subsidiary shall Closing Date will not have outstanding (i) any capital stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding (ii) any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or (iii) any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except . Except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be is not subject to any right or obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except other than as set forth on expressly provided in this Agreement and, as of the Capitalization ScheduleClosing Date, pursuant to the Certificate of Incorporation. There will be no anti-dilution adjustments as a result of the consummation of the transactions contemplated hereby. As of the Closingdate hereof and as of the Closing Date and immediately thereafter, all of the outstanding shares of the Company's ’s capital stock are or shall be validly issued, fully paid and nonassessable. (i) Upon consummation of the transactions contemplated hereunder to occur at the Closing or on such other date as contemplated by paragraph 1B, the authorized capital stock of the Company will consist of 75,000,000 shares of Class A Common Stock, of which 24,525,134 shares will be issued and outstanding, of which 2,871,307 will be reserved for issuance or issuable pursuant to options granted under the Existing Plans as of the date hereof, of which 1,434,595 will be reserved for issuance or issuable pursuant to options that may be granted under Existing Plans after the date hereof and 32,000 of which will be reserved for issuance or are issuable pursuant to outstanding warrants issued by the Company prior to the date hereof; 7,500,000 shares of Class B Common Stock, of which 2,635,000 shares will be issued and outstanding; and 200,000 shares of Preferred Stock, of which 134,000 shares will be issued and outstanding, in each case free and clear of all Liens resulting from any agreement or other action of the Company, except as set forth on the Capitalization Schedule or created pursuant to this Agreement or any Other Transaction Agreement. Upon any conversion of the Preferred Stock in accordance with the Certificate of Incorporation, the Class A Common Stock into which the Preferred Stock will be converted will be duly and validly authorized and issued, fully paid, non-assessable and not subject to any preemptive rights. (ii) Except as shall have been waived set forth on the Capitalization Schedule, immediately prior to giving effect to the Closingtransactions contemplated hereby, there are no statutory or, to the best of the Company's knowledge, or contractual shareholders' stockholder preemptive rights or rights of first refusal or other similar restrictions with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance any of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsCompany’s capital stock. The Company has not violated any applicable federal or state securities laws in connection with the any past offer, sale or issuance of any of its capital stock, and Common Stock or the offer, sale and issuance of the Series C Preferred or Stock hereunder and the Warrants hereunder do issuance of the Preferred Stock does not require registration under the Securities Act or any applicable state securities laws. To Except as set forth on the best of Capitalization Schedule, immediately prior to giving effect to the Company's knowledgetransactions contemplated hereby, there are no agreements between or understandings among the Company's shareholders ’s stockholders or among any other Persons with respect to the voting or transfer of the Company's ’s capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule’s governance.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall will consist of (aA) 15,000,000 100,000 shares of preferred stockthe Preferred, of which 2,000 36,724.64 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall will be issued and outstanding), 5,000,000 and (B) 6,000,000 shares shall be designated as Series B Preferred (of the Common, of which 4,107,044 639,174.4 shares shall will be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the Closing, neither the Company nor any Subsidiary shall will not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation featuresstock, nor shall will it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plansstock, except for as described in the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration dateEquity Purchase Agreement. As of the Closing, neither the Company nor any Subsidiary shall will not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on pursuant to its Charter and the Capitalization ScheduleManagement Agreements with each of Rogex Xxxxxx ("XALLXX"), Raymxxx Xxxxx ("XEWIX") xnd Waltxx Xxxxxx ("BERMXX"). As of the Closing, all of the outstanding shares of the Company's capital stock shall will be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to provided in the ClosingEquity Purchase Agreement, there are no statutory or, to the best of the Company's knowledge, or contractual shareholders' shareholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or Stock hereunder. Based in part on the Warrants hereunderinvestment representations of the Purchaser in Section 5 above, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stockthe Stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Stock hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between among the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairsaffairs other than the Equity Purchase Agreement, except as set forth in the Capitalization ScheduleShareholders Agreement, [THE REGISTRATION AGREEMENT] or the Management Agreements with Ballxx, Xxxxx xxx Bermxx.

Capital Stock and Related Matters. (i) As of the Initial Closing and immediately thereafterhereunder, the authorized capital stock of the Company shall consist consists of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 200,000,000 shares of Common Stock, of which 10,040,000 25,785,017.42 shares shall will be issued and outstanding and 2,500,000 outstanding, 200,000,000 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred, of which 208,910.67 shares will be issued and outstanding, 200,000,000 shares of Series D Preferred, none of which shares will be issued and outstanding, 250,000 shares of Series E Preferred, none of which shares will be issued and outstanding, and 70,000 shares of Series F Preferred, of which 10,375 shares will be issued and outstanding. As of the Initial Closing, neither all of the Company nor any Subsidiary shall have issued and outstanding any stock or securities convertible or exchangeable for any shares of its capital stock will have been duly authorized, validly issued, fully paid and non-assessable, and not subject to, or containing issued in violation of, any profit participation features, nor shall it have outstanding any preemptive rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except of first refusal. Except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth , there are no outstanding or authorized options, warrants, rights, contracts, calls, puts, rights to subscribe, conversion rights or other agreements or commitments to which Issuer is a party or which are binding upon the following information Company providing for the issuance, disposition or acquisition of any appreciation, phantom stock or similar rights with respect to all outstanding options and rights to acquire the Company. To the Company's knowledge, there are no voting trusts, proxies or any other agreements or understandings with respect to the voting of the capital stock: stock of the holderCompany, except pursuant to the number of shares covered, the exercise price and the expiration dateInvestor Rights Agreement. As of the Initial Closing, neither the Company nor any Subsidiary shall will not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock equity securities or any warrants, options options, or other rights to acquire its capital stockequity securities, except as set forth on in the Capitalization Schedule. As Amended Articles of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessableIncorporation. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, contractual shareholderssecurity holders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants Stock hereunder, except as set forth in the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsInvestor Rights Agreement. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale sale, or issuance of any of its capital stocksecurities, and the offer, sale sale, and issuance of the Series C Preferred or the Warrants Stock hereunder do not and will not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 50,000 shares of preferred stock, of which 2,000 20,000 shares shall be designated as Series A 10% Senior Cumulative Preferred (the "Series A Preferred") (Stock, 16,230 of which 2,000 shares shall be issued and outstanding), 5,000,000 and 30,000 shares shall be designated as Series B A-2 10% Senior Cumulative Preferred (Stock, 22,869 of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 500,000 shares of Common Stock, of which 10,040,000 296,302 shares shall be issued and outstanding and 2,500,000 outstanding, 54,551 shares shall be reserved for issuance upon conversion in connection with the Management Option Pool subsequent to the Closing. As of the Series A PreferredClosing and immediately thereafter, 5,000,000 shares the stockholders of the Company shall be reserved for issuance upon conversion of as set forth in the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. "Capitalization Schedule" hereto. (ii) As of the Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." Schedule or as provided in this Agreement or the Subscription Agreement. The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as provided in the Amended Stockholders Agreement, as set forth on the Capitalization Schedule, pursuant to the Certificate of Designation and the Certificate of Incorporation (as amended by the Certificate of Amendment), pursuant to Section 7 of the First Purchase Agreement or pursuant to Section 6 of this Agreement. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (iiiii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholdersstockholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants Stock hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has and its Subsidiaries have not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its their capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Stock hereunder do does not require registration under the Securities Act or any applicable state securities laws. To Except as set forth on the Capitalization Schedule and pursuant to the Amended Stockholders Agreement, to the best of the Company's knowledge, there are no agreements between the Company's shareholders stockholders of the Company or its Subsidiaries with respect to the voting or transfer of the Company's capital stock of the Company or its Subsidiaries or with respect to any other aspect of the Company's affairsaffairs of the Company or its Subsidiaries. (iv) As of the Closing, except the outstanding capital stock of UTS shall consist of (a) 1,000,000 shares of common stock, of which the Company owns 501,000 shares and (b) 2,025 shares of preferred stock, of which the Company owns 2,025 shares. The Company paid an aggregate of $2,000,000 in exchange for all such shares held as set forth of the Closing. The Company has the right, but is not obligated, to purchase additional shares of UTS common stock and preferred stock, at a price of $1,000 for units ("Units") each comprised of one share of preferred stock and 250 shares of UTS common stock. The Company and UTS are parties to an agreement pursuant to which the Company has agreed to purchase from UTS and UTS has agreed to sell to the Company Units of additional UTS common stock and UTS preferred stock in exchange for an aggregate purchase price of $1,350,000. Such purchase agreement, and the Capitalization Scheduletransactions contemplated thereby, have been approved by the board of directors and stockholders of UTS, and the sale of stock contemplated thereby will be consummated at such time as such sale has been approved by the New York Public Service Commission (the "NYPSC"). As of the Closing, in addition to the $1,350,000 advanced pursuant to such purchase agreement, the Company has advanced an aggregate $1,800,000 to UTS, evidenced by promissory notes issued by UTS and which amounts the Company may, at its sole discretion, convert into Units at the price indicated above (subject only to the prior approval thereof by the NYPSC).

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the The authorized capital stock of the Company shall consist consists of (a) 15,000,000 30,000,000 shares of preferred capital stock, of which 2,000 5,000,000 shares shall be are designated as Series A Preferred (the "Series A Preferred") (Stock, par value $.001, and of which 2,000 25,000,000 shares shall be issued and outstanding), 5,000,000 shares shall be are designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferredpar value $.001. As of Immediately prior to the Closing, neither the Company nor any Subsidiary shall had that number of shares outstanding as set forth on Schedule 5.B.(i). Except as set forth on Schedule 5.B.(i), or the Schedule of Exceptions, the Company does not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall does it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plansplans other than pursuant to, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." contemplated by, this Agreement. The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options options, or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the Closing, all All of the outstanding shares of the Company's capital stock are and shall be validly issued, fully paid paid, and nonassessablenon-assessable and free of any Liens other than Liens created by the holders thereof. No event has occurred which would change the conversion price or number of shares issuable upon conversion of any of the Company's outstanding securities. (ii) Except as shall have been waived prior to set forth on the ClosingSchedule of Exceptions, there are no statutory oror contractual preemptive rights, to the best of the Company's knowledgeanti-dilution rights, contractual shareholders' preemptive rights or rights of first refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance any of the Common Stock upon conversion hereunder and the Company has never issued securities in contravention of the Series C Preferred any rights of first refusal, anti-dilution rights, or upon exercise of the Warrantspreemptive rights. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale sale, or issuance of any of its capital stock, and the offer, sale sale, and issuance of the Series C Preferred or the Warrants Common Stock hereunder do does not and will not require registration under the Securities Act or any applicable state securities laws. To Except as disclosed on the best Schedule of the Company's knowledgeExceptions, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall will consist of (aA) 15,000,000 100,000 shares of preferred stockPreferred, of which 2,000 27,439.64 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall will be issued and outstanding), 5,000,000 and (B) 6,000,000 shares shall be designated as Series B Preferred (of Common, of which 4,107,044 615,174.37 shares shall will be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the Closing, neither the Company nor any Subsidiary shall will not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation featuresstock, nor shall will it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plansstock, except for as described in the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration dateEquity Purchase Agreement. As of the Closing, neither the Company nor any Subsidiary shall will not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on pursuant to its Charter and the Capitalization Schedule. As Management Agreements with each of the ClosingRogex Xxxxxx ("BALLXX"), all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable.Raymxxx Xxxxx ("XEWIX") xnd Waltxx Xxxxxx (ii) Except as shall have been waived prior to provided in the ClosingEquity Purchase Agreement, there are no statutory or, to the best of the Company's knowledge, or contractual shareholders' shareholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or Stock hereunder. Based in part on the Warrants hereunderinvestment representations of the Purchasers in Section 5 above, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stockthe Stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Stock hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between among the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairsaffairs other than the Equity Purchase Agreement, except as set forth in the Capitalization ScheduleShareholders Agreement, the Registration Agreement or the Management Agreements with Ballxx, Xxxxx xxx Bermxx.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 20,000,000 shares of preferred stock, of which 2,000 2,100,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (Stock, of which 2,000 2,100,000 shares shall be are issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 50,000,000 shares of Common Stock, of which 10,040,000 shares shall be 8,000,000 are issued and outstanding and 2,500,000 2,100,000 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares Preferred Stock and 2,000,000 shall be reserved for issuance upon conversion exercise of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferredoutstanding options to purchase Common Stock. As of the Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedulecontemplated by this Agreement. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Stock hereunder or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsStock. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Stock hereunder do does not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedulestock.

Capital Stock and Related Matters. (i) 5.2.1 As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 5,000,000 shares of preferred stock, of which 2,000 1,777,778 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 10,000,000 shares of Common Stock, of which 10,040,000 6,984,141 shares shall be issued and outstanding and 2,500,000 1,833,333 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion Preferred Stock and exercise of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C PreferredWarrants. As of the Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing con taining any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants Stock and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the ClosingClosing and upon payment of the purchase price for the Series A Preferred, all of the outstanding shares of the Company's capital stock stock, including the Series A Preferred and Common Stock issuable upon conversion thereof, shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there 5.2.2 There are no statutory or, to the best of the Company's knowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Stock or the Warrants hereunder, hereunder or the issuance of the Common Stock upon conversion of the Series C Preferred Stock or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred Stock or the Warrants hereunder hereunder, and the issuance of Common Stock upon conversion of the Series A Preferred or upon exercise of the Warrants, do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafterOctober 13, 1998, the authorized capital stock of the Company consisted of 50,000,000 shares of Capital Stock, all of which were classified as Common Stock, (a) of which 8,127,314 shares were issued and outstanding and (b) none of which were treasury shares. As of October 13, 1998, neither the Company nor any of its Subsidiaries had outstanding any stock or securities convertible or exchangeable for any shares of the Company's Capital Stock or containing any profit participation features, nor did it have outstanding any rights or options to subscribe for or to purchase the Company's Capital Stock or any stock or securities convertible into or exchangeable for the Company's Capital Stock or any stock appreciation rights or phantom stock plans, except as set forth on the attached "October 13 Capitalization Schedule." The October 13 Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's Capital Stock (both before and after giving effect to the issuance of the Warrants): the holder, the number of shares covered, the exercise price and the expiration date. As of October 13, 1998, neither the Company nor any of its Subsidiaries was subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of the Company's Capital Stock or any warrants, options or other rights to acquire the Company's Capital Stock, except as set forth on the October 13 Capitalization Schedule. As of October 13, 1998, all of the outstanding shares of the Company's Capital Stock were validly issued, fully paid and nonassessable. (ii) As of the Closing Time and immediately thereafter, the authorized Capital Stock of the Company shall consist of (a) 15,000,000 50,000,000 shares of preferred stockCapital Stock, of which 2,000 50,000,000 shares shall be designated classified as Series A Preferred (the "Series A Preferred") (Common Stock, of which 2,000 8,160,039 shares of Common Stock shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 3,463,151 shares shall be reserved for issuance upon conversion exercise of the Series A PreferredOriginal Warrants, 5,000,000 350,000 shares shall be reserved for issuance upon conversion exercise of the Series B Preferred and 3,000,000 First Union Warrants, 383,820 shares shall be reserved for issuance upon conversion exercise of employee stock options outstanding (including unvested options) and 1,177,713 shares shall be reserved for issuance upon exercise of the Series C PreferredGuaranty Warrant and the Tag Along Warrant. As of the ClosingClosing Time, neither the Company nor any Subsidiary of its Subsidiaries shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock the Company's Capital Stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock the Company's Capital Stock or any stock or securities convertible into or exchangeable for its capital stock the Company's Capital Stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Closing Time Capitalization Schedule." The Closing Time Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stockCapital Stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the ClosingClosing Time, neither the Company nor any Subsidiary of its Subsidiaries shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock the Company's Capital Stock or any warrants, options or other rights to acquire its capital stockthe Company's Capital Stock, except as set forth on the Closing Time Capitalization Schedule. As of the ClosingClosing Time, all of the outstanding shares of the Company's capital stock Capital Stock shall be validly issued, fully paid and nonassessable. (iiiii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Warrants hereunder or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsWarrants or any other issuance of Common Stock (or options, warrants or rights to acquire any shares of Common Stock). The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stockCapital Stock, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. There are no agreements between the Company and its stockholders with respect to the registration of shares of the Company's stock under the Securities Act (other than any agreements under which no further registrations of shares are required), except for (a) the Registration Rights Agreement dated December 9, 1996 between the Company and Xxxxxx, Xxxxxxxx & Company, Incorporated, (b) the Founders Registration Rights Agreement dated December 9, 1996 by and among the Company, W. Xxxxx Xxxxxxxx and Xxxxx X. Xxxxxxx and (c) the Warrant Agreement dated February 12, 1999 between the Company and First Union Corporation providing for the issuance of warrants to acquire up to 350,000 shares of the Company's Common Stock (subject to adjustment) (the "First Union Warrants"). To the -------------------- best of the Company's knowledge, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock Capital Stock or with respect to any other aspect of the Company's affairs, except for (a) the Purchase Terms Agreement dated December 6, 1996 and (b) the Supplement to Subscription and Purchase Agreement made between the Company and General Electric Capital Corporation as set forth in the Capitalization Scheduleof December 4, 1996.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (set forth on the attached "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 Capitalization Schedule." The Company has reserved 7,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved Stock for issuance upon conversion of the Series A Preferred, 5,000,000 Preferred Stock . The Company has reserved 1,700,000 shares shall be reserved of its Common Stock for issuance upon conversion pursuant to exercise of options granted under its 1998 Stock Option Plan (the Series B Preferred "Plan"), which is the only stock option, stock purchase or similar incentive or benefit plan currently in effect with respect to the Company. To date, the Company has issued options to acquire an aggregate of 1,663,500 shares of its Common Stock under the Plan, 193,500 of which have expired or been terminated and 3,000,000 shares shall be reserved for issuance upon conversion 10,000 of which have been exercised by the Series C Preferredholders thereof to date. As of the Closing, neither the Company nor any Subsidiary shall have no outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options (contingent or otherwise) to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) The Preferred Stock, when issued, sold and delivered in compliance with the provisions of this Agreement, will be duly and validly issued, fully paid and nonassessable and issued in compliance with applicable federal and state securities laws, and the Underlying Common Stock has been duly and validly reserved and, when issued in compliance with the provisions of the Certificate, will be duly and validly issued and will be fully paid and nonassessable and issued in compliance with applicable federal and state securities laws, and such Preferred Stock and the Underlying Common Stock will be free and clear of any liens or encumbrances; provided, however, that the Preferred Stock and the Underlying Common Stock may be subject to restrictions on transfer under state and/or federal securities laws. (iii) Except as shall have been waived prior to set forth on the Closing, attached "Capitalization Schedule," there are no statutory or, to the best of the Company's knowledge, or contractual shareholdersstockholders' preemptive rights or rights of refusal or similar rights with respect to the issuance of the Series C Preferred Stock hereunder or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsStock. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Stock hereunder do not require registration under the Securities Act or any applicable state securities laws. To Except as set forth on the "Capitalization Schedule," to the best of the Company's knowledge, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in . There are no preemptive or similar rights under the Capitalization ScheduleCompany's Certificate of Incorporation and Bylaws.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafterNovember 10, 1998, the authorized capital stock of the Company shall consist consisted of (a) 15,000,000 10,000,000 shares of preferred stock, Preferred Stock (none of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be were issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 90,000,000 shares of Common Stock, of which 10,040,000 6,321,899 shares shall be were issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferredoutstanding. As of the ClosingNovember 10, 1998, neither the Company nor any Subsidiary shall have of its Subsidiaries had outstanding any stock or securities convertible or exchangeable for any shares of its the Company's capital stock or containing any profit participation features, nor shall did it have outstanding any rights or options to subscribe for or to purchase its the Company's capital stock or any stock or securities convertible into or exchangeable for its the Company's capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "November 10 Capitalization Schedule." The November 10 Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: stock (both before and after giving effect to the issuance of this Warrant): the holder, the number of shares covered, the exercise price and the expiration date. As of the ClosingNovember 10, 1998, neither the Company nor any Subsidiary shall be of its Subsidiaries was subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its the Company's capital stock or any warrants, options or other rights to acquire its the Company's capital stock, except as set forth on the November 10 Capitalization Schedule. As of the ClosingNovember 10, 1998, all of the outstanding shares of the Company's capital stock shall be were validly issued, fully paid and nonassessable. (ii) Except as As of the Closing Time and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 10,000,000 shares of Preferred Stock (none of which shall be issued and outstanding) and (b) 90,000,000 shares of Common Stock, of which 6,126,899 shares shall be issued and outstanding, and 299,999 shares shall be reserved for issuance upon exercise of the Warrant. As of the Closing Time, neither the Company nor any of its Subsidiaries shall have been waived prior to the Closing, there are no statutory or, to the best outstanding any stock or securities convertible or exchangeable for any shares of the Company's knowledge, capital stock or containing (iii) There are no statutory or contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Warrants hereunder or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsWarrants or any other issuance of Common Stock (or options, warrants or rights to acquire any shares of Common Stock). The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. There are no agreements between the Company and its stockholders with respect to the registration of shares of the Company's stock under the Securities Act (other than any agreements under which no further registrations of shares are required), except for the Principals' Registration Rights Agreement. To the best of the Company's knowledge, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of 30,300,000 shares of capital stock, consisting of (a) 15,000,000 30,050,000 shares of preferred stockCommon Stock, par value $.01 per share, of which 2,000 30,000,000 shares shall be are designated Class A Common Stock and 50,000 shares are designated as Class B Common Stock and (b) 250,000 shares of Preferred Stock, par value $1.00 per share, of which 30,000 shares are designated as 9% Cumulative Convertible Pay-In-Kind Preferred Stock and 150,000 are designated as Series A Preferred Stock. (ii) Except (x) as set forth in the "Series A Preferred"Registration Statement, (y) (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding)the USN Solutions Option, and (bz) 80,000,000 the ratification by the Board on October 17, 1997 of a grant of options to purchase 75,000 shares of Class A Common StockStock granted on September 4, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion of the Series A Preferred1997, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As as of the Closing, neither the Company nor any Subsidiary subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, plans except for the Series C Preferred and the Warrants and except as provided in this Agreement. Except as set forth on in the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holderRegistration Statement, the number of shares covered, the exercise price and the expiration date. As as of the Closing, neither the Company nor any Subsidiary subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on pursuant to the Capitalization ScheduleCertificates of Designations, the Certificate of Incorporation, the Original Purchase Agreement and the First Purchase Agreement. As of the Closing, all of the outstanding shares of the Company's capital stock stock, including, without limitation, the Series A Preferred Stock, shall be validly issued, fully paid and nonassessable. (iiiii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholdersstockholders' preemptive rights or rights of refusal that have not been waived with respect to the issuance of the Series C Preferred or the Warrants Shares hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has and its subsidiaries have not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its their respective capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Shares hereunder do does not require registration under the Securities Act or any applicable state securities laws. To Except as contemplated by this Agreement or set forth in the Registration Statement, to the best of the Company's knowledge, there are no agreements between the Company's shareholders stockholders of the Company or its subsidiaries with respect to the voting or transfer of the Company's capital stock of the Company or its subsidiaries or with respect to any other aspect of the Company's affairsaffairs of the Company or its subsidiaries other than the First Purchase Agreement, except the Original Purchase Agreement, the Amended and Restated Stockholders' Agreement, dated July 21, 1995, by and among the Company and the Stockholders (as set forth defined therein), the Registration Agreement and the Second Amended and Restated Stock Transfer Agreement, dated as of July 21, 1995, by and among the Company and the Stockholders (as defined therein). (iv) Following the declaration of a dividend by the Board of Directors of the Company on September 4, 1997, payable at the rate of nine shares of Class A Common Stock for each share of Class A Common Stock outstanding, the Conversion Price (as defined in the Capitalization ScheduleSeries A Certificate of Designations) with respect to the Series A Preferred Stock is $8.80127. (v) The shares of Class A Common Stock issuable upon conversion of the Shares (the "Conversion Shares") have been duly reserved for issuance in accordance with the terms of the Series A Preferred Stock. When issued upon conversion of the Series A Preferred Stock, the Conversion Shares will be duly authorized, validly issued, fully paid and non- assessable.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the The authorized capital stock of the Company shall consist Parent consists of (aA) 15,000,000 50,000,000 shares of common stock, of which 29,157,927 shares of common stock are issued and outstanding, 7,750,000 shares are reserved for future issuance pursuant to outstanding options and warrants to purchase common stock ("Parent ------ Stock Options"), 750,000 shares are reserved for issuance pursuant to the ------------- Parent's Employer Stock Purchase Plan (the "Employer Stock Purchase Plan"), of ---------------------------- which 42,028 shares have been issued to date and no Shares are held in treasury, and (B) 5,000 shares of preferred stock, of which 2,000 no shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be are issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 . Except for the shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion common stock of the Series A PreferredParent issuable pursuant to Parent Stock Option Plan and the Employer Stock Purchase Plan, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the Closing, neither the Company nor any Subsidiary shall have Parent has no outstanding any (1) stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any or rights or options to subscribe for or to purchase its capital stock or any (2) stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." or similar plans or rights. The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be Parent is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the Closing, all All of the outstanding shares of the CompanyParent's capital stock shall be have been duly authorized and are validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there are no statutory or, to the best of the Company's knowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company Parent has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and stock or the offer, sale and or issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities lawsof its debt securities. To the best of the Company's knowledgeExcept as set forth in Section 8B(i) above, there are no voting trusts, proxies, or other agreements between or understandings among the CompanyParent's shareholders stockholders or any other Person with respect to the voting voting, transfer or transfer registration of the CompanyParent's capital stock or with respect to any other aspect of the CompanyParent's affairs. (iii) All of the issued and outstanding shares of capital stock of each of the Acquiror Subsidiaries have been duly authorized and are validly issued, except as set forth fully paid, and nonassessable. Each of the Parent and the Acquiror Subsidiaries holds of record and owns beneficially all of the outstanding shares of each Subsidiary of the Company, free and clear of any restrictions on transfer (other than restrictions under the Securities Act and state securities laws), Taxes, Security Interests, options, warrants, purchase rights, contracts, commitments, equities, claims, and demands. There are no outstanding or authorized options, warrants, purchase rights, subscription rights, conversion rights, exchange rights, or other contracts or commitments that could require any of the Parent and the Acquiror Subsidiaries to sell, transfer, or otherwise dispose of any capital stock of any of its Subsidiaries or that could require any Subsidiary of the Parent to issue, sell, or otherwise cause to become outstanding any of its own capital stock. There are no outstanding stock appreciation, phantom stock, profit participation, or similar rights with respect to any of the Acquiror Subsidiaries. There are no voting trusts, proxies, or other agreements or understandings with respect to the voting of any capital stock of any of the Acquiror Subsidiaries. None of the Parent and the Acquiror Subsidiaries controls directly or indirectly or has any direct or indirect equity participation in the Capitalization Scheduleany corporation, partnership, trust, or other business association which is not an Acquiror Subsidiary.

Capital Stock and Related Matters. (i) As of March 31, 2006, the authorized capital stock of the Company consists of (a) 2,000,000 shares of preferred stock, of which no shares are designated, and (b) 50,000,000 shares of Common Stock, of which 30,222,983 shares are issued and outstanding and 6,254,418 shares are reserved under the Permitted Stock Plans (of which options for 4,504,463 shares of Common Stock have been granted). As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 2,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 50,000 shares shall be designated as Series B Preferred Stock (all of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 of which no other shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding)designated, and (b) 80,000,000 50,000,000 shares of Common Stock, of which 10,040,000 30,222,983 shares (plus any shares issued upon the exercise of options between the date of this Agreement and the Closing Date) shall be issued and outstanding outstanding, 6,254,418 shares shall be reserved under the Permitted Stock Plans and 2,500,000 4,255,320 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of Preferred Stock. Except as set forth above or as disclosed in the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the ClosingCompany SEC Reports, neither the Company nor any Subsidiary shall have has outstanding any stock or securities convertible into or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall does it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration dateStock. As of the Closing, neither Neither the Company nor any Subsidiary shall be is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, stock except as set forth on pursuant to the Capitalization ScheduleCertificate of Designation. As of the Closing, all All of the outstanding shares of the Company's capital stock shall be are validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledgeKnowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance or sale of the Series C Preferred Stock hereunder or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsStock. The Company has complied with all applicable federal or state securities laws in connection with the offer, sale and issuance of the Preferred Stock hereunder, and such offer, issuance and sale do not violated require registration under the Securities Act or any applicable state securities laws. Except such as would not reasonably be expected to have a Material Adverse Effect, the Company has complied with all applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and . Except as disclosed in the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledgeCompany SEC Reports, there are no agreements between the Company and any of its shareholders or, to the Company's Knowledge, among any of the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.

Capital Stock and Related Matters. (i1) As of Immediately prior to the Closing and immediately thereafterClosing, the authorized capital stock of the Company shall consist of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 400,000,000.00 shares of Common Stock, of which 10,040,000 74,985,784.83 shares shall be issued and outstanding; (b) 350,000.00 shares of Series A Preferred, of which 337,582.50 shares shall be issued and outstanding, (c) 142,500.00 shares of Series B Preferred, of which 98,285.56657 shares shall be issued and outstanding and 2,500,000 (d) 7,500.00 shares of Series C Preferred, of which 5,172.92456 shares shall be reserved for issuance upon conversion issued and outstanding (and convertible into 258,646,228 shares of Common Stock). The attached Capitalization Schedule sets forth the ownership of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of Company immediately prior to the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C PreferredClosing. As of the Closing, neither the Company nor any Subsidiary shall not have outstanding (or any commitments to issue) any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth or as contemplated by this Agreement or the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number Proposed Terms of shares covered, the exercise price and the expiration dateRestructuring. As of the Closing, neither the Company nor any Subsidiary shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except pursuant to the Executive Stock Agreements and the Investor Rights Agreement or as set forth on contemplated by this Agreement or the Capitalization ScheduleProposed Terms of Restructuring. As of the Closing, all All of the outstanding shares of the Company's capital stock are, and as of the Closing shall be be, validly issued, fully paid and nonassessable. (ii2) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's actual knowledge, contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Purchased Equity hereunder or any other capital stock or other securities of the Warrants hereunderCompany, except as set forth in the Investor Rights Agreement. Based upon the representations and warranties of the Purchasers set forth herein, and to the Company's knowledge, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stockstock or other securities, and the offer, sale and issuance of the Series C Preferred or the Warrants Purchased Equity hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's actual knowledge, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in for the Capitalization ScheduleInvestor Rights Agreement and Executive Stock Agreements. The Company has not granted any registration rights other than under the Investor Rights Agreement.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 20,000,000 shares of preferred stock, of which 2,000 260,000 shares shall be designated as Preferred Stock and 250,000 shares have been designated as Series A Preferred (the "Stock, of which 70,453 shares of Series A Preferred") (of which 2,000 shares shall be Preferred Stock are issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 100,000,000 shares of Common Stock, of which 10,040,000 shares shall be 4,459,744 are issued and outstanding and 2,500,000 2,500,001 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C PreferredStock. As of the Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedulecontemplated by this Agreement. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred Stock hereunder or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsStock. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Stock hereunder do does not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.state

Capital Stock and Related Matters. (i) As of the Recapitalization Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 50,000 shares of preferred stock, of which 2,000 20,000 shares shall be designated as Series A 10% Senior Cumulative Preferred (the "Series A Preferred") (Stock, 16,200 of which 2,000 shares shall be issued and outstanding), 5,000,000 and 30,000 shares shall be designated as Series B A-2 10% Senior Cumulative Preferred (Stock, 26,235 of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 500,000 shares of Common Stock, of which 10,040,000 423,896 shares shall be issued and outstanding outstanding, and 2,500,000 54,551 shares of which shall be reserved for issuance upon conversion of in connection with the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of Management Option Pool subsequent to the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C PreferredRecapitalization Closing. As of the Recapitalization Closing and immediately thereafter, the Company's issued and outstanding capital stock will be held by the Persons and in the amounts as set forth in the "Capitalization Schedule" hereto. (ii) As of the Recapitalization Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." Schedule or as provided in this Agreement. The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Recapitalization Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as provided in the Amended Stockholders Agreement, as set forth on the Capitalization Schedule, pursuant to the Certificate of Designation and the Certificate of Incorporation (as amended by the Amended Certificate of Designation), pursuant to Section 7 of the First Purchase Agreement or pursuant to Section 6 of this Agreement. As of the Recapitalization Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (iiiii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholdersstockholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants Stock hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has and its Subsidiaries have not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its their capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants Stock hereunder do does not require registration under the Securities Act or any applicable state securities laws. To Except as set forth on the Capitalization Schedule and pursuant to the Stockholders Agreement, to the best of the Company's knowledge, there are no agreements between the Company's shareholders stockholders of the Company or its Subsidiaries with respect to the voting or transfer of the Company's capital stock of the Company or its Subsidiaries or with respect to any other aspect of the Company's affairs, except as set forth in affairs of the Capitalization ScheduleCompany or its Subsidiaries.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafter, the The authorized capital stock of the Company shall consist consists of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 450,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding and 2,500,000 shares shall be reserved for issuance upon conversion Stock as of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion date hereof and will consist of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the Closing, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any 1,100,000,000 shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred Common Stock and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any 300,000,000 shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except Preferred Stock as set forth on the Capitalization Schedule. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived immediately prior to the Closing, there are no statutory orand, as of the date hereof and as of immediately prior to the best Closing, 265,516,066 shares of Common Stock are issued and outstanding. As of the Company's knowledge, contractual shareholders' preemptive rights or rights date hereof and as of refusal with respect immediately prior to the issuance Closing, NEC Corporation and NECAP hold 265,396,066 shares and 120,000 shares, respectively, of the Series C issued and outstanding Common Stock. As of immediately prior to the Closing, 270,934,759 shares of Preferred or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrantsare outstanding. The Company has not violated issued no other capital stock except as expressly contemplated by the Transaction Documents and as disclosed on the corporate register for the Company as at immediately prior to the Closing date. Except as disclosed in Section 4.8 of the Disclosure Schedules: (A) no shares of the Company’s capital stock are subject to preemptive rights or any applicable federal other similar rights or state any liens or encumbrances suffered or permitted by the Company; (B) there are no outstanding stock acquisition rights, bonds with stock acquisition rights, options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities laws in connection with or rights convertible into, or exercisable or exchangeable for, any shares of capital stock of the offerCompany or any of its Subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares of capital stock of the Company or any of its Subsidiaries; (C) there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale or issuance of any of its capital stocktheir securities under the FIEA, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state similar securities laws. To the best of the Company's knowledge, ; (D) there are no agreements between outstanding securities or instruments of the Company's shareholders with respect Company or any of its Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a security of the voting Company or any of its Subsidiaries; (E) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance or transfer of the Company's capital Shares; and (F) the Company does not have any stock option, stock appreciation rights or with respect to “phantom stock” plans or agreements or any other aspect of the Company's affairs, except as set forth in the Capitalization Schedulesimilar plan or agreement.

Capital Stock and Related Matters. (i) As of the date hereof, and without giving effect to the Stock Split, the authorized capital stock of the Company consists of 1,000,000 shares of Common Stock, of which 101,271 shares are issued and outstanding and are held beneficially and of record by the Shareholders as set forth on the Capitalization Schedule attached hereto (free and clear of all Encumbrances). As ----------------------- of the Closing and immediately thereafterthereafter and after giving effect to the Stock Split and the issuance of the Executive Stock, the authorized capital stock of the Company shall consist of (a) 15,000,000 30,000,000 shares of preferred stockPreferred Stock, all of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 60,000,000 shares of Common Stock, of which 10,040,000 22,222,222 shares shall be issued and outstanding and 2,500,000 30,000,000 shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 Preferred Stock and 3,333,333 shares shall be reserved for issuance upon conversion exercise of the Series B Preferred options authorized pursuant to the Stock Option Plan or pursuant to restricted stock purchase agreements authorized by the Company's board of directors. Except as set forth in the immediately preceding sentence, the Company does not have and 3,000,000 shares shall be reserved for issuance upon conversion will not, as of the Series C Preferred. As of the ClosingClosing Date, neither the Company nor any Subsidiary shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except other than, as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the ClosingClosing Date, neither any options granted pursuant to the Stock Option Plan as of the Closing Date. The Company nor any Subsidiary shall be is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except other than as set forth on expressly provided in this Agreement and, as of the Capitalization ScheduleClosing, pursuant to the Articles of Incorporation, the Shareholders Agreement and the Executive Agreements. As of the Closingdate hereof and as of the Closing and immediately thereafter, all of the outstanding shares of the Company's capital stock are or shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholders' shareholder preemptive rights or rights of first refusal or other similar restrictions with respect to the issuance of the Series C Preferred or the Warrants Stock hereunder, the issuance of the Common Stock upon conversion to the Executives pursuant to the Executive Agreements as of the Series C Preferred Closing Date (the "Executive Stock") or the issuance of any Common Stock upon exercise the conversion --------------- of the WarrantsPreferred Stock. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, stock and the offer, sale and issuance of the Series C Preferred or Stock hereunder, the Warrants hereunder do offer, sale and issuance of the Executive Stock, the grant of any stock options under the Stock Option Plan and the issuance of Common Stock upon the conversion of the Preferred Stock does not require registration under the Securities Act or any applicable state securities laws. To Except for the best of Shareholders Agreement to be executed and delivered at the Company's knowledgeClosing, there are no agreements between the Company's shareholders or among any other Person with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedulegovernance.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafterdate hereof, the authorized capital stock of the Company shall consist consists of thirty million (a30,000,000) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Company Common Stock, of which 10,040,000 5,173,679 shares shall be are issued and outstanding, fifteen million (15,000,000) shares of no par value preferred stock, three million six hundred thousand (3,600,000) shares of which are designated as Company Series A Preferred Stock, all of which are issued and outstanding and 2,500,000 six million five hundred seventy-six thousand five hundred seventy-seven (6,576,577) shares shall be reserved for issuance upon conversion of the Series A Preferred, 5,000,000 shares shall be reserved for issuance upon conversion of the which are designated as Company Series B Preferred Stock, all of which are issued and 3,000,000 shares shall be reserved for issuance upon conversion outstanding. Schedule 5.6 of the Series C Preferred. As Company Disclosure Schedule sets forth the names of the Closing, neither record owners of the Company nor any Subsidiary shall Common Stock and Company Preferred Stock and the number of shares held by each such owner. The outstanding shares of Company Common Stock and Company Preferred Stock (i) have been duly authorized and validly issued and are fully paid and nonassessable and (ii) were issued in compliance with all applicable federal and state securities laws. Except as set forth above, referenced in the last sentence of this Section 5.6 or set forth on Schedule 5.6 of the Company Disclosure Schedule, no shares of capital stock of the Company are outstanding; the Company does not have outstanding any stock or securities convertible into or exchangeable for any shares of its capital stock or containing any profit participation featuresstock, nor shall it have outstanding any rights or options to subscribe for or to purchase its or any options for the purchase of, or any agreements providing for the issuance (contingent or otherwise) of, or any calls, commitments or claims of any other character relating to the issuance of, any capital stock stock, or any stock or securities convertible into or exchangeable for its any capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred stock; and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall be is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire retire, or to register under the Securities Act, any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as . All outstanding securities set forth on the Capitalization Schedule. As Schedule 5.6 of the Closing, all of the outstanding shares of Company Disclosure Schedule have been validly issued by the Company's capital stock shall , are fully paid and nonassessable and upon conversion to their underlying security will be validly issued, fully paid and nonassessable. . The Company does not have outstanding any bonds, debentures, notes or other obligations the holders of which have the right to vote (iior convertible into or exercisable for securities having the right to vote) Except with the shareholders of the Company on any matter. No consent of holders of any Company Options or Company Warrants or of participants in any stock option plan, stock incentive plan or any other similar plan sponsored by the Company is required to allow for the treatment of Company Options and Company Warrants as shall provided in Section 4.2. All actions, if any, required with respect to Company Options, Company Warrants and such option, stock incentive and similar plans to allow for the treatment of Company Options and Company Warrants as is provided in Section 4.2, have been waived been, or prior to the ClosingClosing will be, validly taken. As of the date hereof there are no statutory or, to the best of the Company's knowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, 16,091,967 Fully Diluted Shares (including 717,711 Vested Options) and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule864,048 Excluded Options.

Capital Stock and Related Matters. (ia) As of the Closing and immediately thereafter, the authorized capital stock of the Company shall consist of (a) 15,000,000 10,000 shares of preferred stock, of which 2,000 shares shall will be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued Stock and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 108,150 shares of Common Stock, of which 10,040,000 77,350 shares shall be issued and outstanding and 2,500,000 designated as Class A Common Stock, 15,500 shares shall be reserved for issuance upon conversion of the Series A Preferreddesignated Class B Common Stock, 5,000,000 7650 shares shall be reserved for issuance upon conversion of the Series B Preferred designated as Class C Common Stock and 3,000,000 7650 shares shall be reserved for issuance upon conversion of the Series C Preferreddesignated as Class D Common Stock. As of the Closing, neither the Company nor any Subsidiary shall not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plansplans other than pursuant to and as contemplated by this Agreement, except for the Series C Preferred Purchase Agreements, the Stockholders Agreement and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number Certificate of shares covered, the exercise price and the expiration dateIncorporation. As of the Closing, neither the Company nor any Subsidiary shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on pursuant to this Agreement, the Capitalization ScheduleStockholders Agreement and the Purchase Agreements. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (iib) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants Common Stock hereunder, except as provided herein and in the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsStockholders Agreement. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder Common Stock pursuant to this Agreement do not and will not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization ScheduleActs.

Capital Stock and Related Matters. (iA) As of the Closing and immediately thereafter, the The authorized capital stock of the Company shall consist consists of (ai) 15,000,000 2,500,000 shares of preferred stockCompany Class A Common, of which 2,000 (x) 1,247,673.29 shares shall are issued and outstanding and 162,759 are reserved for issuance upon exercise of employee stock options issued pursuant to the Company's Fourth Amended and Restated 1996 Common Stock Option Plan approved by the board of directors of the Company, in each case, immediately prior to the Restructuring and (y) 1,000 shares will be designated as Series A issued and outstanding and held by Holdings immediately after the Restructuring, (ii) 500,000 shares of Class B Common Stock, par value $.001 per share, none of which are issued and outstanding immediately prior to or immediately after the Restructuring, (iii) 100,000 shares of Senior Preferred Stock, par value $1.00 per share, none of which are issued and outstanding immediately prior to or immediately after the Restructuring, (the "iv) 200,000 shares of Company Series A Preferred", (x) (of which 2,000 153,636.54 shares shall be are issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred outstanding immediately prior to the Restructuring and (y) none of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 shares of Common Stock, of which 10,040,000 shares shall be issued and outstanding immediately after the Restructuring, and 2,500,000 (v) 200,000 shares of Company Series B Preferred, (x) of which 109,540.68 shares are issued and outstanding immediately prior to the Restructuring and (y) none of which shall be reserved for issuance upon conversion of issued and outstanding immediately after the Series A PreferredRestructuring. Immediately after the Restructuring, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the Closing, neither the Company nor any Subsidiary shall will not have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for . Immediately after the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holderRestructuring, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its outstanding capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the ClosingRestructuring and immediately thereafter, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (iiB) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance of the Company Class A Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrantsto Holdings pursuant to Section 2. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stockstock pursuant to Section 2, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do Company Class A Common pursuant to Section 2 does not require registration under the Securities Act of 1933, as amended (the "Securities Act"), or any applicable state securities laws. To Immediately after the best of the Company's knowledgeRestructuring, there are will be no agreements between the Company's shareholders stockholders with respect to the voting voting, transfer or transfer registration of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedulestock.

Capital Stock and Related Matters. (i) As of the Closing and immediately thereafterafter giving effect to the transactions contemplated by this Agreement, the authorized capital stock of the Company shall consist of (a) 15,000,000 750,000 shares of preferred stockConvertible Preferred Stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 507,805.25 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 1,100,000 shares of Common Stock, of which 10,040,000 no shares shall be issued and outstanding and 2,500,000 shares 101,500 of which shall be reserved for issuance upon exercise of stock options to be issued under the Company's Stock Option Plan and the remainder of which shall be reserved for issuance upon conversion of the Series A PreferredConvertible Preferred Stock (it being understood that promptly following the Closing, 5,000,000 the Company shall cause to be filed an amendment to its certificate of incorporation increasing the number of authorized shares shall be reserved of its Common Stock to at least 1,200,000 and reserving for issuance upon conversion of the Series B Convertible Preferred and 3,000,000 Stock an additional number of shares shall be reserved for issuance upon of Common Stock sufficient to permit conversion in full of all outstanding shares of Convertible Preferred Stock, together with the Series C Preferredexercise of all outstanding options to acquire Common Stock). As of the Closing, neither the Company nor any Subsidiary of its Subsidiaries shall have outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Convertible Preferred and the Warrants Stock and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding for any options and rights to acquire issued under the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration dateStock Option Plan. As of the Closing, neither the Company nor any Subsidiary of its Subsidiaries shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on in the Capitalization ScheduleCertificate of Incorporation and except pursuant to any rights exercised by the Company pursuant to the Stockholders Agreement (as defined below) or the Executive Stock Agreements entered into by the Company and certain executives, dated as of September 30, 2003. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholders' stockholders preemptive rights or rights of refusal with respect to the issuance of the Series C Convertible Preferred or the Warrants Stock hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Convertible Preferred or the Warrants Stock hereunder do does not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.

Capital Stock and Related Matters. (i) As of the Closing (or other indicated date) and immediately thereafter, after giving effect to the transactions contemplated hereby (i) the authorized capital stock Capital Stock of the Company shall will consist of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 60,000 shares of Common Stock, par value $1.00 per share, of which 10,040,000 30,000 shares shall will be issued and outstanding and 2,500,000 at November 14, 1994, no shares shall will be held by the Company as treasury stock, no shares will be reserved for issuance upon conversion the exercise of the Series A Preferredcurrently outstanding stock options, 5,000,000 no shares shall will be reserved for issuance upon conversion the exercise of the Series B Preferred authorized stock options that have not been granted, and 3,000,000 11,667 shares shall will be reserved for issuance upon conversion the exercise of outstanding Warrants to purchase Common Stock, (ii) no shares of Common Stock will be owned or held by or for the account of the Series C Preferred. As of the ClosingCompany, neither (iii) the Company nor any Subsidiary shall will not have outstanding any stock or securities convertible into or exchangeable for any shares of its capital stock or containing any profit participation featuresCapital Stock, nor shall it have outstanding any rights or options to subscribe for or to purchase, or any options for the purchase its capital stock of, or any agreements providing for the issuance (contingent or other) of, or any calls, commitments or claims of any other character relating to the issuance of, any Capital Stock or any stock or securities convertible into or exchangeable for its capital any Capital Stock (other than (x) stock options or any stock appreciation rights or phantom stock plansissued pursuant to the Performance Plan described in SCHEDULE 9C hereto, except for the Series C Preferred and (y) the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information (z) subscription rights with respect to all outstanding options and rights to acquire any shares not purchased on the Closing Date as a part of the Company's capital stock: initial equity offering of up to a maximum of $6,300,000, including the holder, Common Stock sold on the number of shares covered, the exercise price Closing Date as described in paragraph 4A(xviii)) and the expiration date. As of the Closing, neither (iv) the Company nor any Subsidiary shall will not be subject to any obligation (contingent or otherwiseother) to repurchase or repurchase, otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closing, there are no statutory or, to the best of the Company's knowledge, contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the WarrantsCapital Stock. The Company has not violated granted or agreed to grant any rights relating to the registration of its securities under applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairsincluding piggyback rights, except as set forth provided in the Capitalization ScheduleRegistration Rights Agreement.

Capital Stock and Related Matters. (i) As of Immediately prior to the Closing and immediately thereafterClosing, the authorized capital stock of the Company shall consist of (a) 15,000,000 shares of preferred stock, of which 2,000 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), and (b) 80,000,000 21,000,000 shares of Common Stock, of which 10,040,000 shares shall be 1,000,080 are issued and outstanding and 2,500,000 (b) 21,010,000 shares shall be reserved for issuance upon conversion of the Preferred Stock, of which (X) 9,010,000 shares are designated as Series A PreferredPreferred Stock, 5,000,000 of which 9,000,720 are issued and outstanding, (Y) 2,000,000 shares shall be reserved for issuance upon conversion of the are designated as Series B Preferred Stock, of which 1,189,124 are issued and outstanding and (Z) 3,000,000 shares shall be reserved for issuance upon conversion of the are designated as Series C PreferredPreferred Stock, of which no shares are issued and outstanding. As of the Closing, neither the Company nor any Subsidiary shall have no outstanding any stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization on Schedule 5(b) hereto. Schedule 5(b) accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, covered and the exercise price and the expiration dateprice. As of the Closing, neither the Company nor any Subsidiary shall be subject to any no obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization ScheduleSchedule 5(b). As of the Closing, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (ii) Except as shall have been waived prior to the Closingset forth on Schedule 5(b), there are no statutory or, to the best of the Company's knowledge, or contractual shareholders' stockholders preemptive rights or rights of first refusal with respect to the issuance 4 5 of the Series C Preferred or the Warrants Stock hereunder, the issuance of the Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrants. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stock, and the offer, sale and issuance of the Series C Preferred or the Warrants hereunder do not require registration under the Securities Act or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders stockholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as contemplated by this Agreement and as set forth on Schedule 5(b). (iii) The Series C Preferred Stock that is being purchased by the Investors hereunder, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration expressed herein, will be duly and validly issued, fully paid, and nonassessable, and will be free of restrictions on transfer other than restrictions on transfer under this Agreement, the Rights Agreement, the Stock Restriction Agreement and under applicable state and federal securities laws. The Common Stock issuable upon conversion of the Series C Preferred Stock purchased under this Agreement has been or will be prior to Closing duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Company's Certificate of Incorporation, will be duly and validly issued, fully paid, and nonassessable and will be free of restrictions on transfer other than restrictions on transfer under this Agreement, the Rights Agreement, the Stock Restriction Agreement and under applicable state and federal securities laws. (iv) Subject in part to the truth and accuracy of each Investor's representations set forth in the Capitalization ScheduleSubscription Agreement related to this Agreement, the offer, sale and issuance of the Series C Preferred Stock as contemplated by this Agreement are exempt from the registration requirements of any applicable state and federal securities laws, and neither the Company nor any authorized agent acting on its behalf will take any action hereafter that would cause the loss of such exemption.

Capital Stock and Related Matters. (iA) As of the Closing and immediately thereafter, the The authorized capital stock of the Company shall consist consists of (ai) 15,000,000 2,500,000 shares of preferred stockCompany Class A Common, of which 2,000 (x) 1,672,352 shares shall be designated as Series A Preferred (the "Series A Preferred") (of which 2,000 shares shall be are issued and outstanding), 5,000,000 shares shall be designated as Series B Preferred (of which 4,107,044 shares shall be issued and outstanding) and 3,000,000 shares shall be designated as Series C Preferred (of which 1,307,190 shall be issued and outstanding), outstanding immediately prior to the Restructuring and (by) 80,000,000 1,000 shares of Common Stock, of which 10,040,000 shares shall will be issued and outstanding and held by Holdings immediately after the Restructuring, (ii) 2,500,000 shares of Company Class B Common, (x) 19,118 of which are issued and outstanding immediately prior to the Restructuring and (y) none of which are issued and outstanding immediately after the Restructuring and (iii) 3,000,000 shares of Company Preferred, (x) 1,545,899 of which are issued and outstanding immediately prior to the Restructuring and (y) none of which are issued and outstanding immediately after the Restructuring. Immediately prior to the Restructuring, the record ownership of the capital stock of the Company shall be reserved for issuance upon conversion of as set forth on Schedule 1. Immediately after the Series A PreferredRestructuring, 5,000,000 shares shall be reserved for issuance upon conversion of the Series B Preferred and 3,000,000 shares shall be reserved for issuance upon conversion of the Series C Preferred. As of the Closing, neither the Company nor any Subsidiary shall will not have outstanding any capital stock or securities convertible or exchangeable for any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series C Preferred and Company Class A Common. Immediately after the Warrants and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holderRestructuring, the number of shares covered, the exercise price and the expiration date. As of the Closing, neither the Company nor any Subsidiary shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its outstanding capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the ClosingRestructuring and immediately thereafter, all of the outstanding shares of the Company's capital stock shall be validly issued, fully paid and nonassessable. (iiB) Except as shall have been waived prior to the Closing, there There are no statutory or, to the best of the Company's knowledge, or contractual shareholders' preemptive rights or rights of refusal with respect to the issuance of the Series C Preferred or the Warrants hereunder, the issuance of the Company Class A Common Stock upon conversion of the Series C Preferred or upon exercise of the Warrantsto Holdings pursuant to Section 2. The Company has not violated any applicable federal or state securities laws in connection with the offer, sale or issuance of any of its capital stockstock pursuant to Section 2, and, assuming the representations and warranties of each of the offerContributors contained in Section 3(c) are true and correct, sale and the issuance of the Series C Preferred or the Warrants hereunder do Company Class A Common pursuant to Section 2 does not require registration under the Securities Act of 1933, as amended (the "Securities Act"), or any applicable state securities laws. To the best of the Company's knowledge, there are no agreements between the Company's shareholders with respect to the voting or transfer of the Company's capital stock or with respect to any other aspect of the Company's affairs, except as set forth in the Capitalization Schedule.