Common use of Capitalization of the Company and its Subsidiaries Clause in Contracts

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock.

Capitalization of the Company and its Subsidiaries. The Company's -------------------------------------------------- authorized capital stock of the Company consists solely of (ai) 150,000,000 Shares of which, as of February 19, 1999, 56,419,890 Shares were issued and outstanding and (ii) 20,000,000 shares of common stockPreferred Stock, $0.05 par value of $0.01 per share ("Company Common Stock")share, and (b) 10,000,000 shares of preferred stockwhich, $1.00 par value per share ("Company Preferred Stock"). As as of October 31February 19, 19971999, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any All outstanding shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of February 19, 1999, Employee Options to purchase an aggregate of 6,569,342 Shares were outstanding and the weighted average exercise price of such Employee Options was $14.21 per Share. Except as set forth above or in Schedule 4.2, and except as a result of the exercise of Employee Options outstanding as of February 26, 1999, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options, subscriptions, warrants, convertible securities, calls or other rights to acquire from the Company, and no obligation of the Company to issue, deliver or sell any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company and (iv) no equity equivalents, "phantom" stock rights, stock appreciation rights, performance shares, interests in the ownership or earnings of the Company or other similar rights issued by the Company (collectively, "Company Securities"). Except as set ------------------- forth in Schedule 4.2 or as contemplated by this Agreement or the Stockholders Agreement, there are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth in Schedule 4.2, each Subsidiary of the outstanding shares of capital stock of each of the Company's subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and is directly or indirectly owned by the Company, free and clear of all security interests, liens, claims, pledges, charges, voting agreements or other encumbrances of any preemptive rightsnature whatsoever (collectively, "Liens"). As of the date hereof, other than Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure ScheduleSchedule 4.2, there are no outstanding shares existing options, ----- calls or commitments of any character relating to the issued or unissued capital stock or subscriptionsother securities of any subsidiary of the Company. Except as set forth in Schedule 4.2, optionsand the Stockholders Agreement, warrantsthere are no voting trusts, puts, calls, proxies or other agreements, understandings, claims or other commitments or rights understandings of any type relating character to the issuance, sale or transfer by which the Company or either Subsidiary any of any securities of its subsidiaries is a party or by which the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for of its subsidiaries is bound with respect to the voting of any shares of capital stock of the Company or either Subsidiary; and neither any of its subsidiaries or with respect to the Company nor either Subsidiary has any obligation registration of the offering, sale or delivery of any kind to issue any additional securities or to pay for securities shares of capital stock of the Company or either Subsidiary or any predecessorof its subsidiaries under the Securities Act. The Company has no outstanding There are not any bonds, debentures, notes or other similar obligations indebtedness of the holders of which have Company or its subsidiaries having the right to vote generally with holders (or convertible into, or exchangeable for, securities having the right to vote) on any matters on which stockholders of the Company Common Stock.may vote ("Voting Company Debt"). -------------------

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 The authorized stock of the Company consists of 14,984,490 shares of Class A common stock, $0.05 par value $.01 per share (the "Company Common StockShares"), and (b) 10,000,000 shares of preferred stockwhich, $1.00 par value per share ("Company Preferred Stock"). As as of October 31September 30, 19972000, (i) 3,891,981 shares of Company Common Stock 5,681,156 Shares were issued and outstanding, (ii) 201,385 and 15,510 shares of Company Common Stock Series A-1 convertible preferred stock, par value $.01 per share (the "Convertible Preferred Stock"), of which, as of September 30, 2000, 14,511 shares were issuable outstanding. All of the outstanding Shares have been validly issued and are fully paid and nonassessable, and free of preemptive rights granted by the Company. As of September 30, 2000, (i) 1,515,338 were reserved for issuance upon the exercise of outstanding optionsCompany Stock Options issued pursuant to the Option Plans and other stock option plans, an additional 230,749 shares or agreements to which the Company or any of Company Common Stock its subsidiaries is a party, (ii) 967,448 Shares were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors conversion of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the CompanyConvertible Preferred Stock, and (iii) no shares 123,370 Shares were reserved for issuance upon the exercise of Company Preferred Stock were issued and outstandingthe outstanding Warrants. Since October 31, 1997, except Except as disclosed set forth in Section 4.4 3.2(a) of the Company Disclosure Schedule, the Company has not issued any since September 30, 2000, no shares of its capital the Company's stock except upon the exercise of such options, warrants have been issued other than pursuant to Company Stock Options or convertible securities. Each outstanding share of capital stock other stock-based employee benefit plans of the Company and each Subsidiary is duly authorized no options to acquire Shares have been granted other than pursuant to the Option Plans. Except as set forth above and validly in Section 3.2(a) of the Company Disclosure Schedule, as of the date hereof, there are issued, fully paid reserved for issuance, or outstanding (i) no shares of stock or other voting securities of the Company, (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company or its subsidiaries and, except for the Series B Preferred Stock issuable upon exercise of the Option or as described in Section 3.2(a) of the Company Disclosure Schedule, no obligations of the Company or its subsidiaries to issue any stock, voting securities or securities convertible into or exchangeable for stock or voting securities of the Company, (iv) no bonds, debentures, notes or other indebtedness or obligations of the Company or any of its subsidiaries entitling the holders thereof to have the right to vote (or which are convertible into, or exercisable or exchangeable for, securities entitling the holders thereof to have the right to vote) with the stockholders of the Company or any of its subsidiaries on any matter, and nonassessable and free (v) no equity equivalent interests in the ownership or earnings of any preemptive rightsthe Company or its subsidiaries or other similar rights (collectively "Company Securities"). As of the date hereof, other than except as set forth above, in the Company SEC Documents (as defined in Section 4.73.2(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding obligations of the Company or its subsidiaries (absolute, contingent or otherwise) to repurchase, redeem or otherwise acquire any Company Securities. There are no Shares outstanding subject to rights of first refusal of the Company, nor are there any pre-emptive rights granted by the Company with respect to any Shares. Other than this Agreement, there are no stockholder agreements, voting trusts or other agreements or understandings to which the Company is a party or by which it is bound relating to the voting or, except as set forth in Section 3.2(a) of the Company Disclosure Schedule, registration of any shares of stock of the Company. (b) Except as set forth in Section 3.2(b) of the Company Disclosure Schedule, all of the outstanding stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any Lien (as defined below). There are no securities of the Company or its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any stock or other ownership interests in, or any other securities, of any subsidiary of, the Company. Except as set forth in Section 3.2(b) of the Company Disclosure Schedule, there are no outstanding contractual obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of ownership interests in any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities subsidiary of the Company Company. For purposes of this Agreement, "Lien" means, with respect to any asset (including without limitation any security), any mortgage, lien, pledge, charge, security interest or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation encumbrance of any kind to issue in respect of such asset (including any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have restrictions on the right to vote generally with holders or sell the same except as may be provided as a matter of Company Common Stocklaw).

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares As of common stockthe date hereof and as of the Tender Offer Purchase Time, $0.05 par value per share ("the authorized stock of the Company Common Stock")consists of 45,000,000 Shares, of which, as of September 30, 1998, 8,235,806 Shares were issued and outstanding, and (b) 10,000,000 5,000,000 shares of preferred stock, $1.00 par value $.01 per share ("Company Preferred Stock")share, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of October 31, 19971998, (i) 3,891,981 shares of Company Common Stock approximately 356,500 Shares were issued reserved for issuance and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon or otherwise deliverable in connection with the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of Options issued pursuant to the Company Option Plan referred to in Section 2.14(a). Between September 30, 1998 and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companydate hereof, and (iii) no shares of the Company's stock have been issued other than pursuant to Company Preferred Stock were issued Options, and outstanding. Since between October 31, 1997, except 1998 and the date hereof no stock options have been granted. Except as disclosed set forth above and in Section 4.4 Sections 3.2(a) and 3.19 of the Company Disclosure Schedule, as of the Company has not issued any date hereof, there are issued, reserved for issuance, or outstanding (i) no shares of its capital stock except upon or other voting securities of the exercise of such optionsCompany, warrants or convertible securities. Each outstanding share of capital stock (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company or its subsidiaries and, except as described in the Company SEC Reports (as defined below), no obligations of the Company or its subsidiaries to issue any stock, voting securities or securities convertible into or exchangeable for stock or voting securities of the Company, (iv) no bonds, debentures, notes or other indebtedness or obligations of the Company or any of its subsidiaries entitling the holders thereof to have the right to vote (or which are convertible into, or exercisable or exchangeable for, securities entitling the holders thereof to have the right to vote) with the stockholders of the Company or any of its subsidiaries on any matter, and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free (v) no equity equivalent interests in the ownership or earnings of any preemptive rightsthe Company or its subsidiaries or other similar rights (collectively "Company Securities"). As of the date hereof, other than as set forth abovethe provisions of Section 2.1, in there are no outstanding obligations of the Company SEC Documents or its subsidiaries (absolute, contingent or otherwise) to repurchase, redeem or otherwise acquire any Company Securities. There are no Shares outstanding subject to rights of first refusal of the Company, nor are there any pre-emptive rights with respect to any Shares. Other than this Agreement, there are no stockholder agreements, voting trusts or other agreements or understandings to which the Company is a party or by which it is bound relating to the voting or registration of any shares of stock of the Company. (b) Except as defined disclosed in Section 4.73.2(b) or in Section 4.4 to of the Company Disclosure Schedule, there all of the outstanding stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any Lien (as defined below) or any other limitation or restriction (including any restriction on the right to vote or sell the same except as may be provided as a matter of law). There are no securities of the Company or its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for, the issuance or sale, directly or indirectly, of any stock or other ownership interests in, or any other securities of any subsidiary of, the Company. There are no outstanding contractual obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of ownership interests in any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities subsidiary of the Company Company. For purposes of this Agreement, "Lien" means, with respect to any asset (including without limitation any security), any mortgage, lien, pledge, charge, security interest or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation encumbrance of any kind to issue any additional securities or to pay for securities in respect of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stocksuch asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 of: 22,000,000 shares of common stockClass A Common Stock, $0.05 of which as of the date hereof, 4,159,253 shares are issued and outstanding; 3,000,000 shares of Class B Common Stock, no par value per share ("Company Class B Common Stock"), of which as of the date hereof, 2,050,071 shares are issued and (b) 10,000,000 outstanding; and 3,000,000 shares of preferred stockPreferred Stock, $1.00 par value per share of which as of the date hereof, 1,222,221 shares have been issued in series designated as the Series A Redeemable Convertible Preferred Stock, and are issued and outstanding. (The Class A Common Stock and the Class B Common Stock are herein sometimes collectively referred to as the "Company Common Stock" and the Preferred Stock is sometimes referred to as the "Company Preferred Stock"). As .) All of October 31, 1997, (i) 3,891,981 the issued and outstanding shares of Company Common Stock were and Company Preferred Stock have been duly authorized, validly issued and outstandingare fully paid, nonassessable and free of preemptive rights, except as set forth in the Company Disclosure Schedule. As the date hereof, approximately 434,200 shares of Class A Common Stock are reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding options to purchase Class A Common Stock ("Company Options") issued pursuant to the Management Incentive Plan and the Outside Directors Incentive Plan (the "Company Plans") and 833,611 shares of Class A Common Stock are reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding warrants to purchase Class A Common Stock ("Company Warrants"). Section 3.2(a) of the Company Disclosure Schedule sets forth, as of the date hereof, (i) the persons to whom Company Options and Company Warrants have been granted, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved price for issuance upon the designation of optionees by the Board of Directors of the Company Options and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) Warrants held by the Company, each such person and (iii) no shares of whether such Company Preferred Stock were issued Options are exercisable. Except as described in the Company Filed SEC Reports (as defined below) and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 3.2(a) of the Company Disclosure Schedule, as of the date hereof, since January 31, 1996 (i) no shares of the Company's capital stock have been issued other than pursuant to the exercise of Company Options and (ii) no stock options have been granted by the Company. Except as set forth above or in Section 3.2(a) of the Company Disclosure Schedule, as of the date hereof, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or any Company Subsidiary convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options, warrants or other rights to acquire from the Company or any Company Subsidiary, and no obligations of the Company or any Company Subsidiary to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, (iv) no equity equivalents, interests in the ownership or earnings of the Company or any Company Subsidiary or other similar rights (including stock appreciation rights) (the items listed in subclauses (i), (ii), (iii) and (iv) being referred to, collectively, as "Company Securities") and (v) no obligations of the Company or any Company Subsidiary to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth in Section 3.2(a) of the Company Disclosure Schedule, there are no shareholder agreements, voting trusts or other agreements or understandings to which the Company is a party or to which it is bound relating to the voting or registration of any shares of capital stock of the Company. Except as disclosed in Section 3.2(a) of the Company Disclosure Schedule, the Company has not issued taken any shares action that would result in any Company Stock Options that are unvested becoming vested in connection with or as a result of its capital stock except upon the exercise execution and delivery of this Agreement or the consummation of the transactions contemplated hereby. (b) The direct or indirect interest of the Company in each Company Subsidiary, as described next to the name of such optionsCompany Subsidiary in Section 3.1(a) of the Company Disclosure Schedule, warrants is the only direct or convertible securitiesindirect interest of the Company in such Company Subsidiary. Each outstanding share of capital stock of the each Company and each Subsidiary that is a corporation is duly authorized and authorized, validly issued, fully paid and nonassessable and each share of capital stock and/or each other direct or indirect interest of the Company in each Company Subsidiary described in Section 3.1(a) of the Company Disclosure Schedule as being owned by the Company or a Company Subsidiary is owned by the Company or a Company Subsidiary free and clear of all security interests, liens, claims, pledges, options, rights of first refusal, limitations on voting rights, charges and other encumbrances of any preemptive rightsnature whatsoever (collectively, "Liens"), except where failure to own such shares or other interests free and clear could not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect, and except for the pledge of stock of Company Subsidiaries to Creditanstalt-Bankverein. As of the date hereof, other than Except as set forth above, in the Company SEC Documents (as defined in Section 4.7Schedule 3.2(b) or in Section 4.4 to of the Company Disclosure ScheduleSchedule and except as contemplated by this Agreement, there are no securities of the Company or any Company Subsidiary convertible into or exchangeable for, no options or other rights to acquire from the Company or any Company Subsidiary, and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of, any capital stock of or other ownership interests in, or any other securities of, any Company Subsidiary. There are no outstanding contractual obligations of the Company or any Company Subsidiary to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or subscriptionsother ownership interests in or make any other investment (in the form of a loan, options, warrants, puts, calls, agreements, understandings, claims capital contribution of otherwise) in any Company Subsidiary or any other commitments or rights person. (c) The Class A Common Stock constitutes the only class of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiaryany Company Subsidiary registered or required to be registered under the Securities Exchange Act of 1934, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of as amended (the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock"Exchange Act").

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 The authorized stock of the Company consists of 100,000,000 shares of common stock, $0.05 par value $.01 per share of the Company (the "Company Common StockShares"), of which, as of January 31, 2000, 14,670,560 Shares were issued and (b) outstanding, and 10,000,000 shares of preferred stock, $1.00 par value $.01 per share ("Company Preferred Stock")share, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid and nonassessable, and free of preemptive rights granted by the Company. As of October January 31, 19972000, (i) 3,891,981 shares of Company Common Stock approximately 2,040,652 Shares were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable reserved for issuance upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of Options issued pursuant to the Company Option Plans and 154,175 shares other stock option plans, or agreements to which the Company or any of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on its subsidiaries is a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstandingparty. Since October 31, 1997, except Except as disclosed set forth in Section 4.4 3.2(a) of the Company Disclosure Schedule, the Company has not issued any since January 31, 2000, no shares of its capital the Company's stock except upon the exercise of such options, warrants have been issued other than pursuant to Company Stock Options or convertible securities. Each outstanding share of capital stock other stock-based employee benefit plans of the Company and each Subsidiary is duly authorized no options to acquire Shares have been granted other than pursuant to the Company Option Plans. Except as set forth above and validly issuedin Sections 3.2(a) of the Company Disclosure Schedule, fully paid and nonassessable except for the Rights, the Prism Equity Value Plan-I and free of any preemptive rights. As the Prism Equity Value Plan-II, as of the date hereof, there are issued, reserved for issuance, or outstanding (i) no shares of stock or other than as set forth abovevoting securities of the Company, in (ii) no securities of the Company SEC Documents or its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company or its subsidiaries and, except as defined described in Section 4.73.2(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryits subsidiaries to issue any stock, nor are there outstanding any voting securities which are or securities convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for voting securities of the Company or either Subsidiary or any predecessor. The Company has Company, (iv) no outstanding bonds, debentures, notes or other similar indebtedness or obligations of the Company or any of its subsidiaries entitling the holders of which thereof to have the right to vote generally (or which are convertible into, or exercisable or exchangeable for, securities entitling the holders thereof to have the right to vote) with holders the stockholders of the Company Common Stock.or any of its subsidiaries on any matter, and (v) no equity equivalent interests in the ownership or earnings of the Company or its subsidiaries or other similar rights (collectively "Company Securities"). As of the date

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 The authorized stock of the Company consists of 100,000,000 shares of common stock, $0.05 par value $.01 per share of the Company (the "Company Common StockShares"), of which, as of January 31, 2000, 14,670,560 Shares were issued and (b) outstanding, and 10,000,000 shares of preferred stock, $1.00 par value $.01 per share ("Company Preferred Stock")share, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid and nonassessable, and free of preemptive rights granted by the Company. As of October January 31, 19972000, (i) 3,891,981 shares of Company Common Stock approximately 2,040,652 Shares were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable reserved for issuance upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of Options issued pursuant to the Company Option Plans and 154,175 shares other stock option plans, or agreements to which the Company or any of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on its subsidiaries is a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstandingparty. Since October 31, 1997, except Except as disclosed set forth in Section 4.4 3.2(a) of the Company Disclosure Schedule, the Company has not issued any since January 31, 2000, no shares of its capital the Company's stock except upon the exercise of such options, warrants have been issued other than pursuant to Company Stock Options or convertible securities. Each outstanding share of capital stock other stock-based employee benefit plans of the Company and each Subsidiary is duly authorized no options to acquire Shares have been granted other than pursuant to the Company Option Plans. Except as set forth above and validly in Sections 3.2(a) of the Company Disclosure Schedule, and except for the Rights, the Prism Equity Value Plan-I and the Prism Equity Value Plan-II, as of the date hereof, there are issued, fully paid reserved for issuance, or outstanding (i) no shares of stock or other voting securities of the Company, (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company or its subsidiaries and, except as described in Section 3.2(a) of the Company Disclosure Schedule, no obligations of the Company or its subsidiaries to issue any stock, voting securities or securities convertible into or exchangeable for stock or voting securities of the Company, (iv) no bonds, debentures, notes or other indebtedness or obligations of the Company or any of its subsidiaries entitling the holders thereof to have the right to vote (or which are convertible into, or exercisable or exchangeable for, securities entitling the holders thereof to have the right to vote) with the stockholders of the Company or any of its subsidiaries on any matter, and nonassessable and free (v) no equity equivalent interests in the ownership or earnings of any preemptive rightsthe Company or its subsidiaries or other similar rights (collectively "Company Securities"). As of the date hereof, there are no outstanding obligations of the Company or its subsidiaries (absolute, contingent or otherwise) to repurchase, redeem or otherwise acquire any Company Securities. There are no Shares outstanding subject to rights of first refusal of the Company, nor are there any pre-emptive rights granted by the Company with respect to any Shares. Other than this Agreement, there are no stockholder agreements, voting trusts or other than agreements or understandings to which the Company is a party or by which it is bound relating to the voting or, except as set forth above, in Section 3.2(a) of the Company SEC Documents Disclosure Schedule, registration of any shares of stock of the Company. (b) Except as set forth in Section 3.2(b) of the Company Disclosure Schedule, all of the outstanding stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any Lien (as defined below). There are no securities of the Company or its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any stock or other ownership interests in, or any other securities, of any subsidiary of, the Company. Except as set forth in Section 4.73.2(b) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding contractual obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of ownership interests in any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities subsidiary of the Company Company. For purposes of this Agreement, "Lien" means, with respect to any asset (including without limitation any security), any mortgage, lien, pledge, charge, security interest or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation encumbrance of any kind to issue in respect of such asset (including any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have restrictions on the right to vote generally with holders or sell the same except as may be provided as a matter of Company Common Stocklaw).

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares The authorized share capital of common stock, $0.05 the Company consists of 250,000,000 Company Shares of par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock")US$0.0002. As of October 31December 26, 19972011 (the “Capitalization Date”), (i) 3,891,981 shares of 141,365,622 Company Common Stock Shares were issued and outstanding, outstanding (including Company Shares represented by Company ADSs and 1,051,308 Company Shares issued to Company Depositary and reserved for future grants under the Company Share Incentive Plan); (ii) 201,385 shares 150,000 Company Shares were reserved for issuance upon vesting of the Company Restricted Shares, and (iii) 17,417,586 Company Shares were reserved for issuance upon exercise of the Company Options. Section 3.2 of the Company Disclosure Schedule sets forth a complete and correct list of (A) all holders of Company Common Stock were Options, including such person’s name, the grant or issuance date, the number of Company Options (vested, unvested and total) held by such person as of the Capitalization Date, the exercise price for each such Company Option and the expiration date and (B) all holders of Company Restricted Shares, including such person’s name. The Company has made available to Parent accurate and complete copies of the Company Share Incentive Plan and the form of Award Agreements in respect of the Company Options and Company Restricted Shares granted as of the Capitalization Date. (b) From the Capitalization Date through the date of this Agreement, no options, warrants or other rights to purchase Company Shares have been issued or granted and no Company Shares have been issued other than the transfer of 4,492 Company Shares (represented by Company ADSs) by the Company Depositary to certain holders of Company Options and Company Restricted Shares upon the exercise of such Company Options and vesting of Company Restricted Shares. All the outstanding Company Shares are, and the Company Shares issuable upon the exercise of outstanding options, an additional 230,749 shares Company Options and vesting of Company Common Stock were issuable upon Restricted Shares will be, when issued in accordance with the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companyterms thereof, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31duly authorized, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rightsnon-assessable. As of the date hereof, other than Except as set forth (i) above, (ii) in the VIE Contracts, (iii) in the Company SEC Documents Deposit Agreement, and except for the transactions contemplated by this Agreement, (as defined in Section 4.71) there are no authorized or in Section 4.4 outstanding options, warrants, calls, preemptive rights, subscriptions or other rights, agreements, arrangements or commitments of any character (whether or not conditional) relating to the issued or unissued share capital of the Company Disclosure Scheduleor any of its Subsidiaries, obligating the Company or any of its Subsidiaries to issue, transfer or sell or cause to be issued, transferred or sold any share capital or other equity interest in the Company or any of its Subsidiaries or securities convertible into or exchangeable or exercisable for such share capital or equity interests, or obligating the Company or any of its Subsidiaries to grant, extend or enter into any such option, warrant, call, preemptive right, subscription or other right, agreement, arrangement or commitment, and (2) there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryany of its Subsidiaries to repurchase, nor are there outstanding redeem or otherwise acquire any securities which are convertible into Company Shares or exchangeable for any shares of other share capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities its Subsidiaries, or to pay for securities make any payments based on the market price or value of shares or other share capital of the Company or either Subsidiary or its Subsidiaries. Other than the Company ADSs and the Company Deposit Agreement, the Company does not have outstanding any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally (or convertible into or exchangeable or exercisable for securities having the right to vote) with holders the shareholders of the Company Common Stockon any matter. (c) All of the outstanding share capital of the Company’s wholly owned Subsidiaries (“Wholly Owned Subsidiaries”) has been duly authorized, and validly issued, and is fully paid and nonassessable and owned by the Company, directly or indirectly, free and clear of any Lien (as hereinafter defined). The outstanding share capital of the Company’s Subsidiaries that are not Wholly Owned Subsidiaries (other than VIE and its Subsidiaries) has been duly authorized, and validly issued, and is fully paid and nonassessable and owned by the Company, directly or indirectly, free and clear of any Liens (other than Permitted Liens). For purposes of this Agreement, “Lien” means, with respect to any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 of: 100,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stockwhich, $1.00 par value per share ("Company Preferred Stock"). As as of October December 31, 1997, (i) 3,891,981 6,812,500 shares of Company Common Stock were issued and outstanding, (ii) 201,385 and 2,000,000 shares of preferred stock, no par value per share, no shares of which are issued. All of the shares of Company Common Stock have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of December 31, 1997, approximately 909,500 shares of Company Common Stock were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding optionsCompany Stock Options issued pursuant to the Company Plan. Since December 31, an additional 230,749 1997, no shares of the Company's capital stock have been issued other than pursuant to Company Common Stock were issuable upon Options already in existence on such date, and, since December 31, 1997, no stock options have been granted. Except as set forth above, there are outstanding (i) no shares of capital stock or other voting securities of the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors Company, (ii) no securities of the Company and 154,175 or its Subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company Common Stock were issuable upon or its Subsidiaries, and no obligations of the exercise Company or conversion its Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares equity equivalents, interests in the ownership or earnings of the Company Preferred Stock were issued or its Subsidiaries or other similar rights (collectively, "Company Securities"). There are no outstanding obligations of the Company or its Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. (b) Except as set forth on Schedule 3.2(b) of the disclosure schedule delivered by the Company to Parent concurrently herewith (the "Disclosure Schedule") or as publicly disclosed by the Company, all of the outstanding capital stock of each Subsidiary is owned by the Company, directly or indirectly, free and outstanding. Since October 31, 1997clear of any Lien (as hereinafter defined) or any other limitation or restriction (including any restriction on the right to vote or sell the same, except as disclosed in Section 4.4 may be provided as a matter of law). There are no securities of the Company Disclosure Scheduleor its Subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company has or its Subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not issued contingent) providing for the issuance or sale, directly or indirectly, of any shares of its capital stock except upon the exercise of such optionsor other ownership interests in, warrants or convertible securitiesany other securities of, any Subsidiary. Each There are no outstanding share of capital stock contractual obligations of the Company and each Subsidiary is duly authorized and validly issuedor its Subsidiaries to repurchase, fully paid and nonassessable and free of redeem or otherwise acquire any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptionsother ownership interests in any Subsidiary. For purposes of this Agreement, options"Lien" means, warrantswith respect to any asset (including, putswithout limitation, callsany security) any mortgage, agreementslien, understandingspledge, claims charge, security interest or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation encumbrance of any kind to issue any additional securities or to pay for securities in respect of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stocksuch asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of: 20,000,000 Shares, of (a) 20,000,000 shares which, as of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31March 17, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock 4,411,678 Shares were issued and outstanding. Since October 31All of the Shares have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of March 17, 1997, 84,730 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plan. Since December 11, 1996, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such date, and, since October 16, 1996, no stock options have been granted. Except as set forth above, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or its Subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) except as disclosed set forth in Section 4.4 2.2(a)(iii) of the Company Disclosure Schedule, no options or other rights to acquire from the Company has not issued any shares of or its capital stock except upon the exercise of such optionsSubsidiaries, warrants or convertible securities. Each outstanding share of capital stock and no obligations of the Company and each Subsidiary is duly authorized and validly issuedor its Subsidiaries to issue, fully paid and nonassessable and free of any preemptive rights. As capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the date hereofCompany, other than and (iv) except as set forth abovein Section 2.2(a)(iv) of the Disclosure Schedule no equity equivalents, interests in the ownership or earnings of the Company SEC Documents or its Subsidiaries or other similar rights (including stock appreciation rights) (collectively, "Company Securities"). There are no outstanding obligations of the Company or its Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as defined set forth in Section 4.72.2(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptionsstockholder agreements (other than the Stockholders Agreement), options, warrants, puts, calls, agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or to which it is bound relating to the issuance, sale voting or transfer by the Company or either Subsidiary registration of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; Company. (b) All of the outstanding capital stock of each of the Company's Subsidiaries is owned directly by the Company, free and neither the Company nor either Subsidiary has any obligation clear of any kind Lien (as defined below) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same, except as may be provided as a matter of law). There are no securities of the Company or either Subsidiary its Subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its Subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any capital stock or other ownership interests in, or any predecessorother securities of, any Subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its Subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any Subsidiary of the holders Company. For purposes of which have the right this Agreement, "Lien" means, with respect to vote generally with holders any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of Company Common Stockany kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares 30,000,000 Shares, of common stockwhich, $0.05 par value per share ("Company Common Stock")as of the date hereof 15,062,933 Shares are issued and outstanding, and (b) 10,000,000 6,000,000 shares of preferred stock, $1.00 par value $0.10 per share ("Company Preferred Stock"). As share, of October 31which, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors as of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companydate hereof, and (iii) no shares of Company Preferred Stock were are issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of All the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each and outstanding share of capital stock of the Company and each Subsidiary is duly authorized and Shares are validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than the Company has two equity incentive plans under which on the date hereof, options for a total of 517,738 Shares are outstanding, of which 271,500 are exercisable. Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) above or in Section 4.4 pursuant to the Company Disclosure Scheduleexercise of outstanding Options, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities not as of the Company or either Subsidiarydate hereof, nor are and at the Effective Time there outstanding any securities which are convertible into or exchangeable for will not be, any shares of capital stock of the Company issued or either Subsidiary; and neither outstanding or any subscriptions, options, warrants, calls, rights, convertible securities or other agreements or commitments of any character relating to issued or unissued capital stock or other securities of the Company, or otherwise obligating the Company nor or any of its subsidiaries to issue, transfer or sell any of such securities. Following the Merger, the Company will have no obligation to issue, transfer or sell any shares of its capital stock or other securities of the Company pursuant to any employee benefit plan or otherwise. (b) All of the outstanding shares of capital stock of each of the Company's subsidiaries have been validly issued, fully paid and nonassessable and are owned by either Subsidiary has any obligation the Company or its subsidiaries free and clear of any kind to issue any additional securities all material liens, charges, claims or to pay for encumbrances. (c) The Shares constitute the only class of equity securities of the Company or either Subsidiary any of its subsidiaries registered or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations required to be registered under the holders of which have the right to vote generally with holders of Company Common StockExchange Act.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock consists solely of (a) 20,000,000 shares the Company, immediately prior to the Closing, will consist of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, (i) 3,891,981 shares 25,000,000 Shares of Company Common Stock were which, as of the date hereof, 13,266,131 are issued and outstanding, outstanding and (ii) 201,385 500,000 shares of Company Common Preferred Stock, no par value, of which (A) 250,000 shares have been designated Series A Participating Preferred Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are and reserved for issuance upon the designation of optionees by the Board of Directors exercise of the Company and 154,175 shares Rights distributed to the holders of Company the Common Stock were issuable upon pursuant to the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, Company Rights Agreement and (iiiB) no shares none of Company Preferred Stock were which are issued and outstanding. Since October 31, 1997, except outstanding as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not date hereof. All issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each and outstanding share of capital stock of the Company and each Subsidiary is Shares (i) have been duly authorized and validly issued, (ii) are fully paid and nonassessable non-assessable, (iii) were issued in compliance with all applicable federal and state Laws concerning the issuance of securities and (iv) are free of any preemptive rights. As of the date hereof, (i) 2,599,468 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding options issued to directors, officers, employees and consultants pursuant to the Company's stock option plans (the "Company Stock Options") and (ii) 100,000 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of the warrant (the "WARRANT") to purchase 100,000 Shares, exercisable until December 31, 2001 at an exercise price of $3.181, issued to INK (AL) QRS: 12-21, Inc. Except as and to the extent publicly disclosed by the Company in the Company SEC Reports (as hereinafter defined), since March 23, 2000, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such date, and, since July 13, 2000, no Company Stock Options have been granted. Except as set forth above, in as of the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Scheduledate hereof, there are outstanding (i) no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights voting securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any Company; (ii) no securities of the Company or either Subsidiary, nor are there outstanding any securities which are of its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company; (iii) except for the Company Rights Agreement, no options or other rights to acquire from the Company or any of its subsidiaries, and no obligations of the Company or any of its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company; and (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of its subsidiaries or other similar rights (including stock appreciation rights) (collectively, "COMPANY SECURITIES"). There are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. There are no stockholder agreements, voting trusts or other agreements or understandings to which the Company or any of its subsidiaries is a party or to which it is bound relating to the voting of any shares of capital stock of the Company or either Subsidiary; and neither Company. Section 4.2 of the Company nor either Subsidiary has Disclosure Schedule sets forth information regarding the current exercise price, date of grant and number granted of Company Stock Options for each holder thereof. Following the Effective Time, no holder of Company Stock Options will have any obligation right to receive shares of common stock of the Surviving Corporation upon exercise of the Company Stock Options. (b) All of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any kind Lien (as hereinafter defined) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same, except as may be provided as a matter of Law). There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. For purposes of which have the right this Agreement, "LIEN" means, with respect to vote generally with holders any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of Company Common Stockany kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of: 30,000,000 Shares, of (a) 20,000,000 which, as of August 31, 1999, 14,209,179 Shares were issued and outstanding and 168,500 Shares were held in the Company's treasury. All of the outstanding Shares have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of August 31, 1999, 1,522,870 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options. Between August 31, 1999 and the date hereof, no shares of common the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on August 31, 1999, and, between August 31, 1999 and the date hereof, no stock options have been granted. Except as set forth above, as of the date hereof, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or its subsidiaries convertible into or exercisable or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company or its subsidiaries, and, except as described in the Company SEC Reports (as defined below), no obligations of the Company or its subsidiaries to issue, any capital stock, $0.05 par value per share ("Company Common Stock")voting securities or securities convertible into or exercisable or exchangeable for capital stock or voting securities of the Company, and (biv) 10,000,000 shares no equity equivalents, interests in the ownership or earnings of preferred stock, $1.00 par value per share the Company or its subsidiaries or other similar rights (collectively "Company Preferred StockSecurities"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule, hereof there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryany of its subsidiaries to repurchase, nor redeem or otherwise acquire any Company Securities. There are there outstanding any securities no stockholder agreements, voting trusts or other agreements or understandings to which are convertible into the Company is a party or exchangeable for by which it is bound relating to the voting or registration of any shares of capital stock of the Company or either Subsidiary; and neither Company. (b) Section 2.2(b) of the Company nor either Subsidiary has any obligation Disclosure Schedule identifies each subsidiary of the Company as of the date hereof and shows the jurisdiction of incorporation or organization of each such subsidiary. All of the outstanding capital stock of the Company's subsidiaries (other than directors' qualifying shares in the case of certain foreign subsidiaries) is owned by the Company, directly or indirectly, free and clear of any kind Lien (as defined below) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same, except as may be provided as a matter of law). There are no securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock.its subsidiaries convertible into or

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares As of common stockthe date hereof, $0.05 par value per share ("the authorized stock of the Company Common Stock")consists of 15,000,000 Shares, of which, as of May 31, 1999, 8,005,802 Shares were issued and outstanding, and (b) 10,000,000 1,000,000 shares of preferred stock, $1.00 par value $0.001 per share ("Company Preferred Stock")share, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of October May 31, 19971999, (i) 3,891,981 shares of Company Common Stock approximately 1,182,210 Shares were issued reserved for issuance and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon or otherwise deliverable in connection with the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of Options issued pursuant to the Company Option Plans referred to in Section 2.10. Between May 31, 1999 and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companydate hereof, and (iii) no shares of the Company's stock have been issued other than pursuant to Company Preferred Stock were issued Options, and outstanding. Since October between May 31, 1997, except 1999 and the date hereof no stock options have been granted. Except as disclosed set forth above and in Section 4.4 3.2(a) of the Company Disclosure Schedule, as of the Company has not issued any date hereof, there are issued, reserved for issuance, or outstanding (i) no shares of its capital stock except upon or other voting securities of the exercise of such optionsCompany, warrants or convertible securities. Each outstanding share of capital stock (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company or its subsidiaries and, except as described in the Company SEC Reports (defined herein), no obligations of the Company or its subsidiaries to issue any stock, voting securities or securities convertible into or exchangeable for stock or voting securities of the Company, (iv) no bonds, debentures, notes or other indebtedness or obligations of the Company or any of its subsidiaries entitling the holders thereof to have the right to vote (or which are convertible into, or exercisable or exchangeable for, securities entitling the holders thereof to have the right to vote) with the stockholders of the Company or any of its subsidiaries on any matter, (v) no equity equivalent interests in the ownership or earnings of the Company or its subsidiaries or other similar rights, and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights(vi) the Rights (collectively "Company Securities"). As of the date hereof, other than as set forth above, in there are no outstanding obligations of the Company SEC Documents or its subsidiaries (absolute, contingent or otherwise) to repurchase, redeem or otherwise acquire any Company Securities. There are no Shares outstanding subject to rights of first refusal of the Company, nor are there any pre-emptive rights with respect to any Shares. Other than this Agreement, there are no stockholder agreements, voting trusts or other agreements or understandings to which the Company is a party or by which it is bound relating to the voting or registration of any shares of stock of the Company. (b) Except as defined disclosed in Section 4.73.2(b) or in Section 4.4 to of the Company Disclosure Schedule, there all of the outstanding stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any Lien (defined herein) or any other limitation or restriction (including any restriction on the right to vote or sell the same except as may be provided as a matter of law). There are no securities of the Company or its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for, the issuance or sale, directly or indirectly, of any stock or other ownership interests in, or any other securities of any subsidiary of, the Company. There are no outstanding contractual obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of ownership interests in any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities subsidiary of the Company Company. For purposes of this Agreement, "Lien" means, with respect to any asset (including without limitation any security), any mortgage, lien, pledge, charge, security interest or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation encumbrance of any kind to issue any additional securities or to pay for securities in respect of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stocksuch asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of: (i) 250,000,000 Shares, of (a) 20,000,000 which 70,218,397 Shares were issued and outstanding and 3,052 shares of common stockwhich were held in the Company's treasury, $0.05 par value per share ("Company Common Stock")in each case, as of the close of business on May 21, 1999, and (bii) 10,000,000 shares of preferred stock, $1.00 par value $.001 per share ("Company Preferred Stock")share, no shares of which are outstanding. All of the issued and outstanding Shares have been validly issued, and are duly authorized, fully paid, non-assessable and free of preemptive rights. As of October 31May 21, 19971999, 5,176,485 Shares were issuable pursuant to awards that have been granted under the Directors Restricted Stock Plan, the Option Plan and the Directors' Option Plan. Except for the Company Rights and as set forth above, as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company Common Stock were issuable upon or its subsidiaries, and no obligations of the exercise Company or conversion its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31equity equivalents, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than as set forth above, interests in the Company SEC Documents (as defined in Section 4.7) ownership or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities earnings of the Company or either Subsidiaryits subsidiaries or other similar rights (including stock appreciation rights) (collectively, nor "Company Securities"). There are there no outstanding obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any securities Company Securities. There are no stockholder agreements, voting trusts or other agreements or understandings to which are convertible into the Company is a party or exchangeable for to which it is bound relating to the voting of any shares of capital stock of the Company Company. (b) All of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or either Subsidiary; indirectly, free and neither the Company nor either Subsidiary has any obligation clear of any kind Lien (as hereinafter defined) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same, except as may be provided as a matter of law). There are no securities of the Company or either Subsidiary its subsidiaries convertible into or any predecessor. The Company has exchangeable for, no outstanding bonds, debentures, notes options or other similar obligations rights to acquire from the holders of which have the right to vote generally with holders of Company Common Stock.or its subsidiaries, and no other contract, understanding, arrangement or obligation

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 shares 120 million Shares, of common stockwhich, $0.05 par value per share as of November 30, 2000, 45,518,647 Shares were issued and outstanding, excluding 2,734,083 Shares held in the Company's treasury, (each together with a Share purchase right (the "Rights") issued pursuant to the Stockholder Rights Plan dated as of August 17, 1994 (the "Rights Plan") between the Company Common Stock"and The Bank of New York, as Rights Agent), and (bii) 10,000,000 22 million shares of preferred stock, $1.00 par value $5.00 per share share, of which, as of November 30, 2000, 410,643 Preferred Shares were issued and outstanding and 150,000 shares were designated as Series A Participating Preferred Stock and were reserved for issuance under the Rights Plan and (iii) 8 million shares of preference stock, par value $2.50 per share, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of November 30, 2000, 5,194,720 Shares were reserved for issuance pursuant to outstanding Company Stock Options. Between August 1, 2000 and the date of the Original Agreement, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on the date of the Original Agreement, and between August 1, 2000 and the date of the Original Agreement no stock options have been granted. Except (i) as set forth above, (ii) for 168,786 Shares issuable pursuant to performance-based restricted stock or deferred stock units and (iii) for the Rights, as of November 30, 2000, there were outstanding (A) no shares of capital stock or other voting securities of the Company, (B) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (C) no options or other rights to acquire from the Company or its subsidiaries and, no obligations of the Company or its subsidiaries to issue any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company and (D) no equity equivalent interests in the ownership or earnings of the Company or its subsidiaries (collectively "Company Preferred StockSecurities"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors date of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure ScheduleOriginal Agreement, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryits subsidiaries to repurchase redeem or otherwise acquire any Company Securities. There are no stockholder agreements, nor are there outstanding any securities voting trusts or other agreements or understandings to which are convertible into the Company is a party or exchangeable for by which it is bound relating to the voting or registration of any shares of capital stock of the Company Company. (b) All of the outstanding capital stock of the Company's subsidiaries (other than director's qualifying shares in the case of foreign subsidiaries) is owned by the Company, or either Subsidiary; one of its subsidiaries, directly or indirectly, free and neither the Company nor either Subsidiary has any obligation clear of any kind material Lien or any other material limitation or restriction (including any restriction on the right to issue vote or sell the same except as may be provided as a matter of law) and except for any additional securities or to pay for Liens which are incurred in the ordinary course of business. There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for, the issuance or sale, directly or indirectly, by the Company or any predecessorof its subsidiaries of any capital stock or other ownership interests in or any other securities of any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. For purposes of which have the right this Agreement, "Lien" means, with respect to vote generally with holders any asset (including without limitation any security), any mortgage, lien, pledge, charge, security interest or encumbrance of Company Common Stockany kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 60,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (bii) 10,000,000 5,000,000 shares of preferred stock, $1.00 par value $.01 per share (the "Company Preferred Stock"), of which 500,000 shares have been designated Series A Preferred Stock. As of October 31December 17, 19971999 (the "Capitalization Date"), (i) 3,891,981 22,355,201 shares of Company Common Stock were issued and outstanding, ; (ii) 201,385 3,720,444 shares of Company Common Stock were issuable upon subject to outstanding options issued pursuant to the Company Option Plans (with an average weighted exercise price of outstanding options$12.76), options with respect to an additional 230,749 539,384 shares of Company Common Stock were issuable upon authorized, but not yet issued and 4,259,828 shares, in the exercise of options that are not currently outstanding but are aggregate, were reserved for issuance upon the designation exercise of optionees by the Board of Directors of the Company such outstanding options and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companysuch authorized, and but not yet issued, options; (iii) no shares of Company Common Stock were issued and held in the treasury of the Company; and (iv) no shares of Preferred Stock were issued and outstanding. Since October 31All the outstanding Shares are, 1997and the exercise of outstanding options described in the second sentence of this Section 3.2 will be, except when issued in accordance with the terms thereof, duly authorized, validly issued, fully paid and non-assessable. Except as disclosed set forth in Section 4.4 3.2 of the Company Disclosure Schedule, since the Company has not issued any Capitalization Date, there have been no issuances of shares of its the capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock other securities of the Company and each Subsidiary is duly authorized of options, warrants and validly issued, fully paid and nonassessable and free rights with respect to shares of any preemptive rights. As Company Common Stock or other securities of the date hereofCompany, other than issuances of shares of Company Common Stock pursuant to options outstanding on the Capitalization Date as fully reflected on Section 3.2 of the Company Disclosure Schedule. Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to 3.2 of the Company Disclosure Schedule, and except as set forth above and except for the Company's obligations under the Rights Agreement, dated as of October 5, 1998 (the "Company Rights Agreement"), between the Company and State Street Bank and Trust Company, as rights agent, and except for the transactions contemplated by this Agreement and the Option Agreement, (1) there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company authorized, issued or either Subsidiary; and neither the Company nor either Subsidiary has any obligation outstanding, (2) there are no authorized or outstanding options, warrants, calls, preemptive rights, subscriptions or other rights, agreements, arrangements or commitments of any kind character (whether or not conditional) relating to issue any additional securities the issued or to pay for securities unissued capital stock of the Company or either Subsidiary any of its subsidiaries, obligating the Company or any predecessor. The of its subsidiaries to issue, transfer or sell or cause to be issued, transferred or sold any shares of capital stock or other equity interest in the Company has or any of its subsidiaries or securities convertible into or exchangeable for such shares or equity interests, or obligating the Company or any of its subsidiaries to grant, extend or enter into any such option, warrant, call, subscription or other right, agreement, arrangement or commitment and (3) there are no outstanding bondscontractual obligations of the Company or any of its subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any shares or other similar obligations capital stock of the holders Company or any of which have its subsidiaries, or to make any payments based on the market price or value of shares or other capital stock of the Company or any of its subsidiaries, or to provide funds to make any investment (in the form of a loan, capital contribution or otherwise) in any subsidiary or any other entity other than loans to subsidiaries in the ordinary course of business. (b) Except as set forth in Section 3.2 of the Company Disclosure Schedule, all of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any Lien (as hereinafter defined) or any other limitation or restriction (including any restriction on the right to vote generally or sell the same, except as may be provided as a matter of Law), and there are no irrevocable proxies with holders respect to such capital stock, in each case except for such failures to own and for such proxies that have not had, and would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect on the Company. For purposes of Company Common Stockthis Agreement, "Lien" means, with respect to any asset (including, without limitation, any security), any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of 110,000,000 Shares, of which, as of the close of business on October 13, 1999, 41,028,672 Shares were issued and outstanding (aof which 644,100 are held in treasury by the Company's European subsidiary) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 5,000,000 shares of preferred stock, $1.00 par value $0.001 per share ("Company Preferred Stock")share, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of the close of business on October 3113, 19971999, (i) 3,891,981 shares approximately 9,742,570 Shares were reserved for issuance and, as of Company Common Stock were issued and outstandingthe close of business on October 13, (ii) 201,385 shares of Company Common Stock 1999, 7,762,336 Shares were issuable upon or otherwise deliverable in connection with the exercise of outstanding optionsCompany Stock Options. For purposes hereof, an additional 230,749 "Company Stock Option" means any option, warrant or other right to purchase Shares. Between the close of business on October 1, 1999 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to Company Common Stock were issuable upon Options already in existence on such date and, between the exercise close of business on October 1, 1999 and the date hereof, no stock options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors have been granted, except as set forth in Section 3.2(a) of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise Disclosure Schedule. Except as set forth above or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 3.2(a) of the Company Disclosure Schedule, as of the Company has not issued any date hereof, there are outstanding (i) no shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock or other voting securities of the Company, (ii) no securities of the Company or any of its subsidiaries convertible into or exchangeable or exercisable for shares of capital stock or other securities of the Company, (iii) no options, preemptive or other rights to acquire from the Company or any of its subsidiaries, and, except as described in the Company SEC Reports (as defined below), no obligations of the Company or any of its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable or exercisable for capital stock or other securities of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free (iv) no equity equivalent interests in the ownership or earnings of any preemptive rightsthe Company or its subsidiaries or other similar rights (collectively "Company Securities"). As of the date hereof, other than there are no outstanding rights or obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth above, in the Company SEC Documents (as defined in Section 4.73.2(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or by which it is bound relating to the issuance, sale voting or transfer by the Company or either Subsidiary registration of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessorCompany. The Company has no outstanding bonds, debentures, notes not voluntarily accelerated the vesting of any Company Stock Options as a result of the Offer or the Merger or any other similar obligations change in control of the holders of which have the right to vote generally with holders of Company Common StockCompany.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 shares of common stockCommon Stock of which, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares as of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October July 31, 1997, (i) 3,891,981 4,910,880 shares of Company Common Stock were issued and outstanding, (ii) 201,385 . All outstanding shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company have been validly issued, and are fully paid, nonassessable and free of preemptive rights. Set forth in Schedule 2.2(a) are all outstanding options, warrants, or other rights to purchase Riviera Stock. Except as set forth above or in Schedule 2.2, and except as a result of the exercise of Employee Options, Directors' Options and such rights under the Company Stock Plan and the Compensation Committee Plan outstanding as of July 31, 1997, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options, subscriptions, warrants, convertible securities, calls or other rights to acquire from the Company, and no obligation of the Company to issue, deliver or sell, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, and (iv) no equity equivalents, performance shares, interests in the ownership or earnings of the Company or other similar rights issued by the Company (collectively, "Company Securities"). Except as set forth on Schedule 2.2 hereto, there are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth on Schedule 2.2 hereto, each Subsidiary of the outstanding shares of capital stock of each of the Company's subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and is directly or indirectly owned by the Company, free and clear of all security interests, liens, claims, pledges, charges, voting agreements or other encumbrances of any preemptive rightsnature whatsoever (collectively, "Liens"). As of the date hereof, other than Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Scheduleon Schedules 1.10 and 2.2 hereto, there are no outstanding shares existing options, calls or commitments of any character relating to the issued or unissued capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights equity securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities subsidiary of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common StockCompany.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, of: (i) 3,891,981 35,000,000 shares of Company Common Stock Stock, par value $1.00 per share, of which, as of August 5, 1998, 14,718,508 shares were issued and outstanding, and (ii) 201,385 (x) 1,878,870 shares of Company Series B Preference Stock, of which 16,000 shares are issued and outstanding; (y) 200,000 shares, of Series C Preferred Stock, par value $ 1.00 per share, of which no shares are issued and outstanding; and (z) 200,000 shares of Series D Preferred Stock, of which 200,000 shares are issued and outstanding. All of the issued and outstanding shares of Common Stock and Preference Stock have been duly authorized, validly issued, and are fully paid, nonassessable and free of preemptive rights. As of August 5, 1998, 1,373,300 shares of Common Stock were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding options, an additional 230,749 options granted by the Company to purchase shares of Common Stock issued pursuant to the Company stock incentive plans listed on Section 4.2(a) of the Company Disclosure Schedule (the "Company -9- 14 Stock Incentive Plans") and 1,651,456 shares of Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance and issuable upon the designation of optionees by the Board of Directors conversion of the Company and 154,175 shares of Company Common Preference Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstandingin accordance with its terms. Since October 31August 5, 19971998, except as disclosed in set forth on Section 4.4 4.2(a) of the Company Disclosure Schedule, the Company has not issued any no shares of its the Company's capital stock except upon have been issued otherwise than pursuant to the exercise of options granted by the Company to purchase shares of Common Stock already in existence on such optionsdate, warrants or convertible securitiesand, since July 23, 1998, no options to purchase shares of the Company Common Stock have been granted. Each Except as set forth above in this Section 4.2(a), there are outstanding share (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not contingent) of the Company or its subsidiaries to issue or sell, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company and each Subsidiary is duly authorized and validly issued(iv) no equity equivalents, fully paid and nonassessable and free of any preemptive rights. As or interests in the ownership or earnings, of the date hereofCompany or its subsidiaries (including stock appreciation rights) (collectively, other than the "Company Securities"). There are no contracts, understandings, arrangements or obligations (whether or not contingent) of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth above, in the Company SEC Documents (as defined in Section 4.74.2(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or to which it is bound relating to the issuance, sale or transfer by the Company or either Subsidiary voting of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common StockCompany.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 The authorized stock of the Company consists of 25,800,000 shares of common stockPreferred Stock, $0.05 par value per share ("Company of which 25,000,000 are designated Series B Stock and 800,000 are designated Series A Stock, and 40,000,000 shares of Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31February 20, 19972007, (i) 3,891,981 13,972,365 shares of Company Common Stock were issued and outstanding, (ii) 201,385 149,962 shares of Series A Stock were issued and outstanding and 4,500,000 shares of Series B Stock were outstanding. All such shares of Common Stock, Series A Stock and Series B Stock outstanding as of such date have been duly authorized, validly issued, and are fully paid, nonassessable and free of preemptive rights or other similar rights. The Company has no commitments to issue or deliver any shares of Common Stock, except that, as of February 20, 2007, a total of 1,090,265 shares of Common Stock were issuable upon the exercise of reserved for issuance pursuant to outstanding optionsCompany Options, an additional 230,749 702,680 shares of Company Common Stock were issuable reserved for issuance pursuant to outstanding Company Common Warrants, 8,283,000 shares of Series B Stock were reserved for issuance pursuant to outstanding warrants to purchase Series B Stock, 22,077 shares of Common Stock were required for issuance upon conversion and in accordance with the exercise terms of options that are not currently outstanding but are Debentures, 458,134 shares of Common Stock were reserved for issuance upon the designation conversion of optionees by the Board of Directors of the Company and 154,175 outstanding shares of Company Series A Preferred Stock and 12,783,000 shares of Common Stock were reserved for issuance upon conversion of shares of Series B Stock (both outstanding and issuable upon exercise of warrants to purchase Series B Stock). All outstanding Company Options are governed by the exercise terms and conditions of the Company’s 2003 Stock Plan and the standard form of stock option agreement used for such plans, respectively. All outstanding Company Common Warrants are governed by the terms and conditions of a warrant agreement, the form of which is included as an exhibit to a Company Report. Except as set forth in this paragraph, there are no authorized or conversion outstanding debt or equity securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any no obligations to authorize or issue additional debt or equity securities of the Company. (b) As of the date hereof, the number of shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each Common Stock into which each outstanding share of Series A Stock is convertible is 3.055; the number of shares of Common Stock into which each outstanding share of Series B Stock is convertible is 1.0; and the voting power of each outstanding share of Series B Stock in any matter presented to the holders of the Company’s capital stock voting as a single class is 0.81833 per share (compared to 1.0 per share for each outstanding share of Common Stock). (c) Each of the Company and outstanding shares of capital stock or other securities of each Subsidiary of the Company’s Subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable nonassessable, and owned by the Company or by a direct or indirect wholly-owned Subsidiary of the Company, free and clear of any preemptive rightsLien. As Section 5.1 of the date hereof, Company Disclosure Schedule sets forth a correct and complete list of all such capital stock or other than securities. Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; any of its Subsidiaries authorized, reserved, issued or outstanding and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities there are no preemptive or to pay for other outstanding rights, subscriptions, options, warrants, stock appreciation rights, redemption rights, repurchase rights, convertible, exercisable, or exchangeable securities of the Company or either Subsidiary any of its Subsidiaries or other agreements, arrangements or commitments of any character to which the Company or any predecessorof its Subsidiaries is a party relating to the issued or unissued share capital or other ownership interest of the Company or any of its Subsidiaries or any other securities or obligations of the Company or any of its Subsidiaries convertible or exchangeable into or exercisable for, or giving any Person a right to subscribe for or acquire, any securities of the Company or its Subsidiaries, and no securities evidencing such rights are authorized, issued or outstanding. The Except as set forth above, the Company has no does not have outstanding any bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally (or convertible or exchangeable into or exercisable for securities having the right to vote) with holders the stockholders of the Company Common Stockon any matter. (d) There are no voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party with respect to the voting of any of the capital stock of the Company. None of the Company or any of its Subsidiaries is obligated under any registration rights or similar agreements to register any shares of capital stock of the Company or any of its Subsidiaries on behalf of any Person.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 shares One Hundred Million (100,000,000) Shares, of common stockwhich, $0.05 par value per share as of November 6, 2003, Twelve Million Five Hundred and Eighty Five Thousand Nine Hundred and Sixty Three ("Company Common Stock"), 12,585,963) Shares were issued and outstanding; and (bii) 10,000,000 Ten Million (10,000,000) shares of preferred stock, $1.00 par value $0.001 per share ("Company Preferred Stock"), none of which are outstanding as of the date hereof. All of the outstanding Shares are and the Shares issuable upon exercise of the Company Stock Options, when issued in accordance with the Company Plan, would be validly issued and fully paid, nonassessable and not subject to any preemptive rights. As of November 6, 2003, an aggregate of Five Million Six Hundred and Six Thousand Eight Hundred and Seven (5,606,807) Shares were reserved for issuance of which Four Million Two Hundred and Seventy Six Thousand and Twenty Four (4,276,024) Shares were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. Between October 311, 19972003 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to the exercise of Company Stock Options already in existence on such first date, and between October 1, 2003 and the date hereof, no stock options have been granted. Except as set forth above, as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or any Subsidiary convertible into or exchangeable or exercisable for, shares of capital stock or other voting securities of the Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companyany Subsidiary, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock other rights to acquire from the Company or any Subsidiary, and no obligations of the Company or any Subsidiary to issue any capital stock, voting securities or securities convertible into or exchangeable or exercisable for capital stock or other voting securities of the Company or any Subsidiary, and each (iv) no equity equivalent interests in the ownership or earnings of the Company or any Subsidiary is duly authorized or other similar rights. All of the outstanding Shares and validly issuedCompany Stock Options (collectively "Company Securities") were issued in compliance with the Securities Act of 1933, fully paid as amended (the "Securities Act"), and nonassessable and free of any preemptive rightsapplicable state securities laws. As of the date hereof, other than as set forth above, in there are no outstanding rights or obligations of the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 any Subsidiary to repurchase, redeem or otherwise acquire any outstanding shares of its capital stock or other ownership interests. Other than the Company Disclosure ScheduleVoting Agreements, there are no outstanding stockholder agreements, voting trusts or other arrangements or understandings to which the Company, the Company Board or any Subsidiary is a party, and to the Company's knowledge, there are no other agreements, voting trusts or other arrangements or understandings, relating to the voting or registration of any shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any voting securities of the Company or either any Subsidiary. Other than treasury stock as described in the Financial Statements, nor no Shares, Company Preferred Stock or Company Stock Options are there owned by the Company or any Subsidiary. The Company has provided a true and complete list of all holders of outstanding Company Stock Options, the exercise or vesting schedule, the exercise price per share, and the term of each Company Stock Option, and whether such option is a nonqualified stock option or incentive stock option, and any securities which are convertible into or exchangeable for any shares restrictions on the Company's right to repurchase of capital stock the Shares underlying the options, in each case as of the date hereof. None of the terms of the Company Stock Options provides for accelerated vesting as a result of the execution and delivery of this Agreement or either Subsidiary; and neither the consummation of the transactions contemplated hereby. The Company has not granted Company Stock Options to employees or consultants under any Company Plan at an exercise price of less than the fair market value per Share at the time of grant as determined in good faith by the Company nor either Subsidiary has any obligation Board. The terms of any kind the Company Plans allow the Company Plans to issue any additional securities or to pay for be terminated at the Effective Time. (b) The Shares constitute the only class of equity securities of the Company or either Subsidiary its Subsidiaries registered or any predecessor. The Company has no outstanding bondsrequired to be registered under the Securities Exchange Act of 1934, debentures, notes or other similar obligations as amended (the holders of which have the right to vote generally with holders of Company Common Stock"Exchange Act").

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of Two Hundred Thirty-Six Million Two Hundred Fifty Thousand (a236,250,000) 20,000,000 shares Shares, of common stockwhich, $0.05 par value per share as of March 1, 1999, 38,992,734 Shares were issued and outstanding and Ten Million ("Company Common Stock"), and (b10,000,000) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock")no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of October 31March 1, 1999, approximately 7,430,200 Shares were reserved for issuance and, as of March 1, 1999, approximately 6,770,200 were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. Between March 1, 1999 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such first date, and between March 1, 1999 and the date hereof, no stock options have been granted. Except as set forth above and for the Company's 4% Convertible Subordinated Notes due 2004 (the "Subordinated Notes") issued pursuant to the Indenture dated as of August 15, 1997, by and between the Company and State Street Bank and Trust Company of California, N.A. (the "Indenture"), as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 no securities of the Company or any of its subsidiaries convertible into or exchangeable or exercisable for shares of Company Common Stock were issuable upon capital stock or other securities of the exercise of outstanding Company, (iii) no options, an additional 230,749 shares preemptive or other rights to acquire from the Company or any of its subsidiaries, and, except as described in the Company Common Stock were issuable upon SEC Reports (as defined below), no obligations of the exercise Company or any of options that are not currently outstanding but are reserved its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable or exercisable for issuance upon the designation of optionees by the Board of Directors capital stock or other securities of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares equity equivalent interests in the ownership or earnings of the Company Preferred Stock were issued and outstandingor its subsidiaries or other similar rights (collectively "Company Securities"). Since October 31, 1997, except Except as disclosed set forth in Section 4.4 2.2(a) of the Company Disclosure Schedule, as of the date hereof, there are no outstanding rights or obligations of the Company has not issued or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. There are no stockholder agreements, voting trusts or other agreements or understandings to which the Company is a party or by which it is bound relating to the voting or registration of any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company. The Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free has not voluntarily accelerated the vesting of any preemptive rights. As Company Stock Options as a result of the date hereofMerger or any other change in control of the Company. (b) All of the outstanding capital stock of the Company's subsidiaries owned by the Company is owned, directly or indirectly, free and clear of any Lien or any other than limitation or restriction (including any restriction on the right to vote or sell the same except as may be provided as a matter of Applicable Law). Except as set forth above, in the Company SEC Documents (as defined in Section 4.72.2(b) or in Section 4.4 to of the Company Disclosure Schedule, there are no (i) securities of the Company or any of its subsidiaries convertible into or exchangeable or exercisable for, (ii) options or (iii) other rights to acquire from the Company or any of its subsidiaries any capital stock or other ownership interests in or any other securities of any subsidiary of the Company, and there exists no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any such capital stock. There are no outstanding contractual obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or subscriptionsother ownership interests in any subsidiary of the Company. For purposes of this Agreement, options"Lien" means, warrantswith respect to any asset (including any security), putsany mortgage, callslien, agreementspledge, understandingscharge, claims security interest or other commitments or rights encumbrance of any type relating to kind in respect of such asset; provided, however, that the issuance, sale term "Lien" shall not include (i) statutory liens for Taxes that are not yet due and payable or transfer are being contested in good faith by the Company or either Subsidiary of any securities appropriate proceedings and are disclosed in Section 2.14 of the Company Disclosure Schedule or either Subsidiarythat are otherwise not material, nor are there outstanding any securities which are convertible into (ii) statutory or exchangeable for any shares of capital stock of common law liens to secure obligations to landlords, lessors or renters under leases or rental agreements confined to the Company premises rented, (iii) deposits or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities pledges made in connection with, or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bondssecure payment of, debenturesworkers' compensation, notes unemployment insurance, old age pension or other similar obligations the holders social security programs mandated under Applicable Laws, (iv) statutory or common law liens in favor of which have the right carriers, 6 12 warehousemen, mechanics and materialmen, to vote generally with holders secure claims for labor, materials or supplies and other like liens, and (v) restrictions on transfer of Company Common Stocksecurities imposed by applicable state and federal securities laws.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of of: (ai) 20,000,000 100,000,000 shares of common stockCommon Stock, $0.05 par value $.0001 per share (the "Company Common StockCOMMON STOCK"), of which, as of December 1, 1998, 60,868,825 shares were issued and outstanding and no shares were held in treasury, (ii) 500,000,000 shares of Class A Common Stock, par value $.0001 per Share (the "CLASS A COMMON STOCK"; and collectively with the Common Stock, the "COMPANY COMMON STOCK"), of which, as of December 1, 1998, 28,941,950 shares were issued and outstanding and no shares were held in treasury and (biii) 10,000,000 50,000,000 shares of preferred stockPreferred Stock, $1.00 par value $.01 per share ("Company Preferred Stock")share, no shares of which are issued and outstanding. As All of October 31, 1997, (i) 3,891,981 the issued and outstanding shares of Company Common Stock have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of December 1, 1998, 713,400 shares of Class A Common Stock were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding options granted by the Company to purchase shares of Class A Common Stock (the "COMPANY STOCK OPTIONS") issued and outstandingpursuant to the Company stock option plans listed in Section 3.2(a) of the Company Disclosure Schedule. Since December 1, 1998, no shares of the Company's capital stock have been issued other than pursuant to the exercise of Company Stock Options already in existence on such date and, since December 1, 1998, no Company Stock Options have been granted. Except as set forth above in this Section 3.2(a), as of the date hereof, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company Common Stock were issuable upon or its subsidiaries, and no obligations of the exercise Company or conversion its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31equity equivalents, 1997or interests in the ownership or earnings, except as disclosed in Section 4.4 of the Company Disclosure Scheduleor its subsidiaries or other similar rights (including stock appreciation rights) (collectively, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities"COMPANY SECURITIES"). Each There are no outstanding share of capital stock obligations of the Company and each Subsidiary is duly authorized and validly issuedor its subsidiaries to repurchase, fully paid and nonassessable and free of redeem or otherwise acquire any preemptive rightsCompany Securities. As of the date hereof, other than Except as set forth above, in the Company SEC Documents (as defined in Section 4.73.2(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, shareholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or to which it is bound relating to the issuance, sale or transfer by the Company or either Subsidiary voting of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither Company. (b) Except as set forth in Section 3.2(b) of the Company nor either Subsidiary has any obligation Disclosure Schedule, all of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any kind Lien (as defined below) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same, except as may be provided as a matter of law). There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. For purposes of which have the right this Agreement, "LIEN" means, with respect to vote generally with holders any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of Company Common Stockany kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares 12,000,000 Common Shares, of common stockwhich, $0.05 par value per share ("Company Common Stock")as of May 25, and (b) 10,000,000 shares of preferred stock1998, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock 8,973,475 Shares were issued and outstandingoutstanding and 1,000,000 Preferred Shares of which, (ii) 201,385 shares as of Company Common Stock were issuable upon the exercise of outstanding optionsMay 25, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company1998, and (iii) no shares of Company 8,110 Preferred Stock Shares were issued and outstanding. Since October All of the outstanding Common Shares and Preferred Shares have been duly authorized, validly issued and are fully paid, nonassessable and free of preemptive rights. As of May 25, 1998, approximately 984,250 Common Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. Schedule 2.2(a) sets forth a list of each outstanding option as of May 25, 1998, the name of the holder, the vesting date, and if exercisability or vesting will be accelerated in any way in connection with the consummation of the transactions contemplated in this Agreement. Between January 1, 1998 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such date, and between January 1, 1998 and the date hereof no stock options have been granted. Except as set forth above, as of the date hereof, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company except for the Preferred Shares, (iii) no options, warrants (other than warrants issued to Telemetrix and described in the Company's annual report on Form 10-K/A for the fiscal year ended December 31, 1997) or other rights to acquire from the Company or its subsidiaries and, except as disclosed described in Section 4.4 Schedule 2.2(a), no obligations of the Company Disclosure Scheduleor its subsidiaries to issue any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company has not issued or to grant, extend, accelerate the vesting of, change the price of, or otherwise amend any shares of its capital stock except upon the exercise of such options, warrants (other than warrants issued to Telemetrix and described in the Company's annual report on Form 10-K/A for the fiscal year ended December 31, 1997), calls, rights, commitments or convertible securities. Each outstanding share of capital stock agreements and (iv) no equity equivalent interests in the ownership or earnings of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rightsor its subsidiaries or other similar rights (collectively "Company Securities"). As of the date hereof, other than there are no outstanding obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Scheduleon Schedule 2.2(a), there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or by which it is bound relating to the issuance, sale voting or transfer by the Company or either Subsidiary registration of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither Company. Since March 31, 1998 there have been no changes in the capital structure of the Company nor either Subsidiary has any obligation other than issuances of Common Shares upon exercise of outstanding options granted under the Company Plans. (b) Except as set forth on Schedule 2.2(b), all of the outstanding capital stock of the Company's subsidiaries (other than director's qualifying shares in the case of foreign subsidiaries) is owned by the Company, directly or indirectly, free and clear of any kind Lien (as defined below) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same except as may be provided as a matter of law). Except as set forth on Schedule 2.2(b), there are no securities of the Company or either Subsidiary its subsidiaries convertible into or any predecessor. The Company has exchangeable for, no outstanding bondsoptions, debentures, notes warrants or other similar obligations rights to acquire from the holders Company or its subsidiaries and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for, the issuance or sale, directly or indirectly, of which have the right to vote generally with holders of Company Common Stock.any capital stock or other

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 shares of common stockstock of which, $0.05 par value per share ("Company Common Stock")as of the date hereof, 4,323,648 are issued and outstanding and (bii) 10,000,000 1,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As $1.00, none of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that which are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not All issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each and outstanding share of capital stock of the Company and each Subsidiary is Shares (i) have been duly authorized and validly issued, (ii) are fully paid and nonassessable non-assessable, and (iii) are free of any preemptive rights. As of the date hereof, other than 954,000 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of options (the "Options") listed on Section 4.2 of the Company Disclosure Schedule, which sets forth the material terms of such Options, including but not limited to exercise price and voting provisions. Except as set forth aboveabove and except as otherwise set forth on Section 4.2 of the Company Disclosure Schedule, as of the date hereof, there are outstanding (i) no shares of capital stock or other voting securities of the Company; (ii) no securities of the Company or any of its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company; (iii) no options or other rights to acquire from the Company or any of its subsidiaries, and no obligations of the Company or any of its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company; and (iv) no equity equivalents, interests in the ownership or earnings of the Company SEC Documents or any of its subsidiaries or other similar rights (including stock appreciation rights) (collectively, "Company Securities"). Except as defined in set forth above and except as otherwise set forth on Section 4.7) or in Section 4.4 to 4.2 of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryany of its subsidiaries to repurchase, nor redeem or otherwise acquire any Company Securities. There are there outstanding no stockholder agreements, voting trusts or other agreements or understandings to which the Company or any securities of its subsidiaries is a party or to which are convertible into or exchangeable for it is bound relating to the voting of any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities Company. (b) Except as otherwise set forth on Section 4.2 of the Company or either Subsidiary or any predecessor. The Company has no Disclosure Schedule, all of the outstanding bonds, debentures, notes capital stock or other similar obligations equity or ownership interests of the holders Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of which have the right to vote generally with holders of Company Common Stock.any Lien (as defined

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of: (i) 225,000,000 Shares, of (a) 20,000,000 which 114,835,000 Shares were issued and outstanding as of the close of business on May 1, 2000 and 1,331,000 shares of common stock, $0.05 par value per share ("Company Common Stock")which are owned by subsidiaries of the Company, and (bii) 10,000,000 25,000,000 shares of preferred stock, par value $1.00 par value per share (the "Company Preferred StockPREFERRED STOCK"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were which are outstanding. All of the issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and Shares have been validly issued, and are duly authorized, fully paid paid, non-assessable and nonassessable and are free of any preemptive rights. As of May 18, 2000, (i) 35,397,614 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the date hereofexercise of outstanding Company Stock Options issued pursuant to the Company Option Plans and (ii) 566,232.337 Shares were reserved for issuance and issuable or otherwise deliverable pursuant to the Stock Purchase Plan. Except as and to the extent publicly disclosed by the Company in the Company SEC Reports (as hereinafter defined), other than since December 31, 1999, no Company Stock Options have been granted. Except as set forth above, in as of the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Scheduledate hereof, there are outstanding (i) no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights voting securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any Company; (ii) no securities of the Company or either Subsidiary, nor are there outstanding any securities which are of its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company; and (iii) except as provided in this Agreement and the Stock Option Agreement, no options or other rights to acquire from the Company or any of its subsidiaries, and no obligations of the Company or any of its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company; and (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of its subsidiaries or other similar rights (including stock appreciation rights, but excluding amounts payable under the Company's bonus and similar plans) (collectively, "COMPANY SECURITIES"). There are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. There are no stockholder agreements (other than the Stock Option Agreement and the Stockholders Agreement), voting trusts or other agreements or understandings to which the Company or any of its subsidiaries is a party or to which it is bound relating to the voting of any shares of capital stock of the Company or either Subsidiary; and neither Company. Section 3.2 of the Company nor either Subsidiary has Disclosure Schedule sets forth information regarding the current exercise price, date of grant and number of Company Stock Options granted for each holder thereof (with information with respect to holders of such options valued at less than $100,000 being aggregated). Following the Effective Time, no holder of Company Stock Options will have any obligation right to receive shares of common stock of the Surviving Corporation upon exercise of the Company Stock Options. (b) All of the outstanding capital stock of the Company's Material Subsidiaries is owned by the Company, directly or indirectly, free and clear of any kind Lien (as hereinafter defined) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same, except as may be provided as a matter of Law). There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any Material Subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its Material Subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any Material Subsidiary of the holders Company. For purposes of which have the right this Agreement, "LIEN" means, with respect to vote generally with holders any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of Company Common Stockany kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of 26,000,000 shares of Company Common Stock, consisting of (ai) 20,000,000 16,000,000 shares of common stockCommon Stock, $0.05 par value $0.01 per share ("Company the “Common Stock"Shares”), and (bii) 10,000,000 shares of preferred stockClass C Common Stock, $1.00 par value $0.01 per share ("the “Class C Shares”, and together with the Common Shares, the “Company Preferred Common Stock"”). As of October 31the Effective Date, 1997, (i) 3,891,981 7,331,954 Common Shares are issued and outstanding and 5,461,957 Class C Shares are issued and outstanding. All of the issued and outstanding shares of Company Common Stock were have been duly authorized and validly issued and outstanding, (iiare fully paid and nonassessable. No shares of capital stock are held by the Company as treasury shares. Schedule 3.6(a) 201,385 sets forth all holders of record of issued and outstanding shares of Company Common Stock were issuable upon the exercise of Stock, identified by each class thereof. All outstanding options, an additional 230,749 shares of the Company Common Stock and any securities described in Sections 3.6(b) have been issued or granted, as applicable, in compliance, in all material respects, with applicable securities Laws and were issuable upon the exercise not issued in violation of options that any pre-emptive rights, purchase option, call right, right of first refusal or any similar right. There are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of no declared or accrued unpaid dividends with respect to any Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable Stock. (on a contingent basis or otherwiseb) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except Except as disclosed described in this Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule3.6, there are no outstanding shares of capital stock or subscriptions, options, warrants, putsrights, calls, agreements, understandings, claims subscriptions or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable or exercisable for any shares of the capital stock of the Company, any other commitments or agreements providing for the issuance of additional shares, the sale of treasury shares or for the repurchase or redemption of shares of the capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation other agreements of any kind to issue any additional securities or to pay for securities of which may obligate the Company to issue, purchase, redeem or either Subsidiary or otherwise acquire any predecessorof its capital stock. The Company has There are no (i) outstanding bonds, debentures, notes or other similar obligations indebtedness of the holders Company or any of which its Subsidiaries that have the right to vote generally with (or convertible and other securities that have the right to vote) on matters on which the holders of the Company Common StockStock may vote or (ii) except as set forth in Schedule 3.6, shareholders agreements, proxies, voting agreements or registration right agreements relating to the Company Common Stock or any other equity interests of the Company or any of its Subsidiaries. (c) The outstanding shares of capital stock of each of the Company’s Subsidiaries have been duly authorized and validly issued and are fully paid and nonassessable. The Company or one or more of its wholly owned Subsidiaries owns of record and beneficially all the issued and outstanding shares of capital stock of such Subsidiaries free and clear of any Liens, other than Permitted Liens. Except as described in this Section 3.6, there are no outstanding options, warrants, rights, subscriptions or other securities exercisable or exchangeable for any capital stock of such Subsidiaries, any other commitments or agreements providing for the issuance of additional shares, the sale of treasury shares or for the repurchase or redemption of shares of such Subsidiaries’ capital stock or any other agreements of any kind which may obligate any Subsidiary of the Company to issue, purchase, redeem or otherwise acquire any of its capital stock.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 shares Three Hundred Million (300,000,000) Shares, of common stockwhich, $0.05 par value per share as of May 28, 2003, One Hundred Twenty-Two Million Four Hundred Twenty-Six Thousand Six Hundred Sixty-Four ("Company Common Stock"), 122,426,664) Shares were issued and outstanding; and (bii) 10,000,000 Five Million (5,000,000) shares of preferred stock, $1.00 par value $0.001 per share ("Company Preferred StockCOMPANY PREFERRED STOCK"), none of which are outstanding as of the date hereof. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of May 28, 2003, an aggregate of Thirty-One Million Nine Hundred Sixty-Six Thousand Two Hundred Sixty-Nine (31,966,269) Shares were reserved for issuance of which Twenty-Two Million Forty-Five Thousand Three Hundred and One (22,045,301) Shares were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. Between May 28, 2003 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to the exercise of Company Stock Options already in existence on such first date, and between May 28, 2003 and the date hereof, no stock options have been granted. Except as set forth above and for the stockholder rights ("COMPANY RIGHTS") issued pursuant to that certain Preferred Stock Rights Agreement, dated as of October 3122, 19972001, as amended, between the Company and Computershare Trust Company, Inc., as Rights Agent (the "COMPANY RIGHTS AGREEMENT"), as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or any Subsidiary convertible into or exchangeable or exercisable for, shares of capital stock or other voting securities of the Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companyany Subsidiary, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock other rights to acquire from the Company or any Subsidiary, and no obligations of the Company or any Subsidiary to issue any capital stock, voting securities or securities convertible into or exchangeable or exercisable for capital stock or other voting securities of the Company or any Subsidiary, and each (iv) no equity equivalent interests in the ownership or earnings of the Company or any Subsidiary is duly authorized or other similar rights. All of the outstanding Shares and validly issuedCompany Stock Options (collectively "COMPANY SECURITIES") were issued in compliance with the Securities Act of 1933, fully paid as amended (the "SECURITIES ACT"), and nonassessable and free of any preemptive rightsapplicable state securities laws. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 except with respect to the Restricted Company Disclosure ScheduleShares, there are no outstanding rights or obligations of the Company or any Subsidiary to repurchase, redeem or otherwise acquire any outstanding shares of its capital stock or other ownership interests. Other than the Company Voting Agreements, there are no stockholder agreements, voting trusts or other arrangements or understandings to which the Company, the Company Board or any Subsidiary is a party, and to the Company's knowledge, there are no other agreements, voting trusts or other arrangements or understandings, relating to the voting or registration of any shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any voting securities of the Company or either any Subsidiary. Other than treasury stock as described in the Financial Statements, nor no Shares, Company Preferred Stock or Company Stock Options are there owned by the Company or any Subsidiary. The Company has provided to Parent a true and complete list of all holders of outstanding Restricted Company Shares or Company Stock Options, the exercise or vesting schedule, the exercise price per share, and the term of each Restricted Company Share or Company Stock Option, as applicable and in the case of Company Stock Options, whether such option is a nonqualified stock option or incentive stock option, and any securities which restrictions on the Company's right to repurchase of the Shares underlying the options, and whether or not, to the Company's knowledge, an election under Section 83(b) of the Code is in effect with respect to such Shares that are convertible into or exchangeable for any shares Restricted Company Shares, in each case as of capital stock the date hereof. None of the terms of the Company Stock Options or either Subsidiary; Restricted Company Shares provides for accelerated vesting as a result of the execution and neither delivery of this Agreement or the consummation of the transactions contemplated hereby. Other than as disclosed in the Company's SEC Reports filed on or before the date hereof, since the Company's initial public offering, the Company nor either Subsidiary has not granted Company Stock Options to employees or consultants under any obligation Company Plan at an exercise price of any kind to issue any additional securities or to pay for less than the fair market value per Share at the time of grant as determined in good faith by the Company Board. (b) The Company Rights and the Shares constitute the only classes of equity securities of the Company or either Subsidiary its Subsidiaries registered or any predecessor. The Company has no outstanding bondsrequired to be registered under the Securities Exchange Act of 1934, debentures, notes or other similar obligations as amended (the holders of which have the right to vote generally with holders of Company Common Stock"EXCHANGE ACT").

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) of: 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), Stock and (b) 10,000,000 1,000,000 shares of preferred stock, $1.00 par value $.001 per share ("Company Preferred Stock"). As of October 31November 6, 19971998, 5,182,973 Common Shares were issued and outstanding and no shares of the Preferred Stock were outstanding. All Common Shares have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of November 6, 1998, a total of 999,906 Common Shares are reserved for issuance pursuant to outstanding Options under the Stock Plans, of which (i) 3,891,981 shares of Company 65,320 Common Shares are reserved for issuance pursuant to outstanding Stock were issued and outstandingOptions under the Company's 1991 Stock Option Plan, (ii) 201,385 shares of Company 475,032 Common Shares are reserved for issuance pursuant to outstanding Stock Options under the Company's 1995 Stock Option Plan, (iii) 454,554 Common Shares are reserved for issuance pursuant to outstanding Stock Options under the Company's 1997 Stock Option Plan, (iv) 5,000 Common Shares are reserved for issuance pursuant to outstanding Stock Options under the Company's 1997 Director Plan, and (v) assuming that the Option Cancellation Time were to occur on or about November 6, 1999, approximately 1,900 Common Shares would have been issuable upon the exercise of outstanding optionsPurchase Plan Options under the Employee Stock Purchase Plan at a price of $12.86 per Common Share. Since November 6, an additional 230,749 1998, no shares of Company Common the Company's capital stock have been issued other than pursuant to Options already in existence on such date and no Options have been granted. Except as set forth above and except for the Rights to, among other things, purchase Series A Participating Preferred Stock were issuable upon issued pursuant to the exercise Rights Agreement, there are outstanding (i) no shares of options that are not currently outstanding but are reserved for issuance upon capital stock or other voting securities of the designation of optionees by the Board of Directors Company, (ii) no securities of the Company and 154,175 or any of its Subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company Common Stock were issuable upon or any of its Subsidiaries, and no obligations of the exercise Company or conversion any of outstanding warrants its Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities granted or issuable (on a contingent basis or otherwise) by of the Company, and (iiiiv) no shares equity equivalents, interests in the ownership or earnings of the Company Preferred Stock were issued or any of its Subsidiaries or other similar rights (collectively, "Company Securities"). There are no outstanding obligations of the Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. (b) All of the outstanding capital stock of, or other ownership interests in, each Subsidiary of the Company, is owned by the Company, directly or indirectly, free and outstanding. Since October 31, 1997clear of any Lien (as defined herein) or any other limitation or restriction (including any restriction on the right to vote or sell the same, except as disclosed in Section 4.4 may be provided as a matter of the Company Disclosure Schedule, the Company has not issued any law). All such shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and have been validly issued, fully paid and nonassessable nonassessable, and have been issued free of any preemptive rights. As There are no securities of the date hereofCompany or any of its Subsidiaries convertible into or exchangeable for, no options or other than as set forth above, in rights to acquire from the Company SEC Documents or any of its Subsidiaries, and no other contract, understanding, arrangement or obligation (as defined in Section 4.7whether or not contingent) providing for the issuance or in Section 4.4 to sale, directly or indirectly, of any capital stock or other ownership interests in, or any other securities of, any Subsidiary of the Company. There are no outstanding contractual obligations of the Company Disclosure Scheduleor any of its Subsidiaries to repurchase, there are no redeem or otherwise acquire any outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of ownership interests in any type relating to the issuance, sale or transfer by the Company or either Subsidiary of the Company. For purposes of this Agreement, "Lien" means, with respect to any securities of the Company asset (including, without limitation, any security) any option, claim, mortgage, lien, pledge, charge, security interest or either Subsidiary, nor are there outstanding any securities which are convertible into encumbrance or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation restrictions of any kind to issue any additional securities or to pay for securities in respect of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stocksuch asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of of: (ai) 20,000,000 200,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (bii) 10,000,000 5,000,000 shares of preferred stockstock of the Company, $1.00 par value $.01 per share ("share, 400,000 shares of which are designated as shares of Company Preferred Stock"). As of October 31, 1997the date hereof, (i) 3,891,981 64,333,205 shares of Company Common Stock were issued and outstanding, outstanding and (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no 50,000 shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 All of the Company Disclosure Schedule, the Company has not issued any outstanding shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company Common Stock and each Subsidiary is duly authorized and Company Preferred Stock have been validly issued, and are fully paid and paid, nonassessable and free of any preemptive rights. As of the date hereof, a total of (i) 4,937,802 shares of Company Common Stock were reserved for issuance pursuant to outstanding Stock Options and RSUs, and no other shares of Company Common Stock are subject to issuance pursuant to Stock Options or any other equity based awards, (ii) 3,873,108 shares of Company Common Stock were reserved for issuance upon the exercise of currently outstanding warrants issued under the warrant agreements listed in Section 4.2(a) of the Company Disclosure Schedule (the “Warrant Agreements”) and (iii) 32,664,256 shares of Company Common Stock were reserved for issuance upon the exercise of Co-Investment Rights. Set forth in Section 4.2(a) of the Company Disclosure Schedule is a complete and accurate list of (i) the Company Stock Plans and the number of shares of Company Common Stock reserved for issuance pursuant to Stock Options outstanding as of the date hereof under each such Company Stock Plan, and no other shares of Company Common Stock are subject to issuance pursuant to such Company Stock Plans, (ii) all warrant agreements to acquire capital stock of the Company and the number of shares of Company Common Stock reserved for issuance pursuant to such warrant agreements, and no other shares of capital stock of the Company are subject to issuance pursuant to such warrant agreements and (iii) all Co-Investment Agreements to acquire capital stock of the Company and the number of shares of Company Common Stock reserved for issuance pursuant to such Co-Investment Agreements, and no other shares of capital stock of the Company are subject to issuance pursuant to such Co-Investment Agreements. Since January 19, 2005, no shares of capital stock of the Company have been issued other than pursuant to Stock Options set forth on the Award List, Warrant Agreements or Co-Investment Agreements existing as of date hereof, and since January 19, 2005, no Stock Options, Restricted Shares, Warrants or Co-Investment Rights have been granted. Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) above or in Section 4.4 to 4.2(a) of the Company Disclosure Schedule, there are no outstanding (i) shares of capital stock (including Restricted Shares) or other voting securities of the Company, (ii) securities of the Company or any of its Subsidiaries convertible into or exchangeable for shares of capital stock or subscriptionsvoting securities of the Company, (iii) options, warrants, puts, calls, agreements, understandings, claims warrants or other commitments or rights of any type relating to the issuance, sale or transfer by acquire from the Company or either any of its Subsidiaries, or obligations of the Company or any of its Subsidiaries to issue or sell, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, or (iv) equity equivalents, interests in the ownership or earnings of the Company or other similar rights (collectively, “Company Securities”). Other than as contemplated by this Agreement, Stockholders’ Agreement or employment agreements set forth in Section 4.10(a) of the Company Disclosure Schedule, there are no outstanding obligations of the Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. (b) All of the outstanding capital stock of, or other ownership interests in, each Subsidiary of the Company is owned by the Company, directly or indirectly, free and clear of any Lien or any other limitation or restriction (including any restriction on the right to vote or sell the same, except as may be provided as a matter of law). All such shares have been validly issued, fully paid and nonassessable, and have been issued free of preemptive rights. There are no outstanding securities of the Company or either Subsidiary, nor are there outstanding any securities which are of its Subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or any of its Subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of, any capital stock or other ownership interests in, or any other securities of, any Subsidiary of the Company. There are no outstanding equity equivalents, interests in the ownership or earnings or similar rights of any Subsidiary of the Company. There are no contractual obligations of the Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or other ownership interests in any Subsidiary of the Company, other than as contemplated by this Agreement and the Stockholders’ Agreement. (c) No class of equity securities of the Company or any of its Subsidiaries is registered or required to be registered under the Exchange Act. No Subsidiary of the Company owns any capital stock in the Company. (d) Other than the Support Agreements and the Stockholders’ Agreement, there are no voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries or to the Company’s Knowledge, any of the Company’s stockholders, is a party with respect to the voting of the capital stock of the Company or either Subsidiary; and neither any of its Subsidiaries. (e) Other than with respect to the Indebtedness set forth in Section 4.2(e) of the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities Disclosure Schedule, there is no Indebtedness of the Company or either Subsidiary any of its Subsidiaries existing that contains any material restriction upon, or imposes any predecessor. The material penalty with respect to (i) the prepayment of such Indebtedness, (ii) the incurrence of Indebtedness by the Company has no outstanding bondsor its Subsidiaries, debenturesrespectively, notes or other similar obligations (iii) the holders ability of which have the right Company or its Subsidiaries to vote generally with holders of Company Common Stockgrant any Liens on its properties or assets.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares 15,000,000 Shares, of common stockwhich, $0.05 par value per share ("Company Common Stock")as of the date of this Agreement, 4,680,253 Shares were issued and outstanding, and (b) 10,000,000 5,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock")none of which are outstanding. As All of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were the outstanding Shares have been validly issued and outstandingare fully paid, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date of this Agreement, 1,672,192 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options. Except as disclosed in Section 2.02 of the Company Disclosure Schedule, between October 31,1997 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such date, and between October 31,1997 and the date hereof no Company Stock Options have been granted. Except as set forth above, as of the date hereof and as of the Effective Time, there are outstanding: (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options, warrants, subscriptions, calls, rights or other agreements to acquire from the Company or its subsidiaries, and no obligations of the Company or its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company and (iv) no equity equivalent interests or rights to acquire equity equivalent interests in the ownership or earnings of the Company SEC Documents or its subsidiaries or other similar rights (collectively "Company Securities"). As of the date hereof, there are no outstanding obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as defined set forth in Section 4.72.02(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or by which it is bound relating to the issuance, sale voting or transfer by the Company or either Subsidiary registration of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; other Company Securities, and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock.to

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, of: (i) 3,891,981 240,000,000 shares of Company Common Stock were Stock, of which 56,465,838 shares are issued and outstandingoutstanding as of the date hereof and 2,105,372 shares are held by the Company in treasury, and (ii) 201,385 2,000,000 shares of Company Common Stock were issuable upon the exercise Preferred Stock, par value $.01 per share, of outstanding optionswhich 100,000 shares are designated as Series A Junior Participating Preferred Stock, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were which are outstanding. All of the issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and Shares have been validly issued, and are duly authorized, fully paid and nonassessable paid, non-assessable and free of any preemptive rights. As of the date hereof, other than 7,092,273 Shares are reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Option Plans and 4,326,757 Shares are reserved for issuance upon conversion of the Company's 4-1/4% Convertible Subordinated Notes due 2007 (the "4-1/4% NOTES"). Except as set forth aboveabove and except for the Option Agreement, in the 4-1/4% Notes and the Company SEC Documents Rights Agreement (as defined in Section 4.7) or in Section 4.4 to hereinafter defined), as of the Company Disclosure Scheduledate hereof, there are no outstanding (i) shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights voting securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any Company; (ii) securities of the Company or either Subsidiary, nor are there outstanding any securities which are of its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company; (iii) options or other rights to acquire from the Company or any of its subsidiaries, and no obligations of the Company or any of its subsidiaries to issue, any stock, voting securities, or securities convertible into or exchangeable for stock or voting securities of the Company; or (iv) equity equivalents, interests in the ownership or earnings of the Company, or other similar rights (including stock appreciation rights) (collectively, "COMPANY SECURITIES"). Except for the Option Agreement and the 4-1/4% Notes, there are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. There are no stockholder agreements, voting trusts or other agreements or understandings to which the Company or any of its subsidiaries is a party or to which it is bound relating to the voting of any shares of capital stock of the Company or either Subsidiary; and neither (other than the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common StockVoting Agreement).

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares 12,000,000 Common Shares, of common stockwhich, $0.05 par value per share ("Company Common Stock")as of May 25, and (b) 10,000,000 shares of preferred stock1998, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock 8,973,475 Shares were issued and outstandingoutstanding and 1,000,000 Preferred Shares of which, (ii) 201,385 shares as of Company Common Stock were issuable upon the exercise of outstanding optionsMay 25, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company1998, and (iii) no shares of Company 8,110 Preferred Stock Shares were issued and outstanding. Since October All of the outstanding Common Shares and Preferred Shares have been duly authorized, validly issued and are fully paid, nonassessable and free of preemptive rights. As of May 25, 1998, approximately 984,250 Common Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. Schedule 2.2(a) sets forth a list of each outstanding option as of May 25, 1998, the name of the holder, the vesting date, and if exercisability or vesting will be accelerated in any way in connection with the consummation of the transactions contemplated in this Agreement. Between January 1, 1998 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such date, and between January 1, 1998 and the date hereof no stock options have been granted. Except as set forth above, as of the date hereof, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company except for the Preferred Shares, (iii) no options, warrants (other than warrants issued to Telemetrix and described in the Company's annual report on Form 10-K/A for the fiscal year ended December 31, 1997) or other rights to acquire from the Company or its subsidiaries and, except as disclosed described in Section 4.4 Schedule 2.2(a), no obligations of the Company Disclosure Scheduleor its subsidiaries to issue any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company has not issued or to grant, extend, accelerate the vesting of, change the price of, or otherwise amend any shares of its capital stock except upon the exercise of such options, warrants (other than warrants issued to Telemetrix and described in the Company's annual report on Form 10-K/A for the fiscal year ended December 31, 1997), calls, rights, commitments or convertible securities. Each outstanding share of capital stock agreements and (iv) no equity equivalent interests in the ownership or earnings of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rightsor its subsidiaries or other similar rights (collectively "Company Securities"). As of the date hereof, other than there are no outstanding obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Scheduleon Schedule 2.2(a), there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or by which it is bound relating to the issuance, sale voting or transfer by the Company or either Subsidiary registration of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither Company. Since March 31, 1998 there have been no changes in the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities capital structure of the Company or either Subsidiary or any predecessor. The other than issuances of Common Shares upon exercise of outstanding options granted under the Company has no Plans. (b) Except as set forth on Schedule 2.2(b), all of the outstanding bondscapital stock of the Company's subsidiaries (other than director's qualifying shares in the case of foreign subsidiaries) is owned by the Company, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock.directly or

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 shares Three Hundred Million (300,000,000) Shares, of common stockwhich, $0.05 par value per share as of May 28, 2003, One Hundred Twenty-Two Million Four Hundred Twenty-Six Thousand Six Hundred Sixty-Four ("Company Common Stock"), 122,426,664) Shares were issued and outstanding; and (bii) 10,000,000 Five Million (5,000,000) shares of preferred stock, $1.00 par value $0.001 per share ("“Company Preferred Stock"”), none of which are outstanding as of the date hereof. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of May 28, 2003, an aggregate of Thirty-One Million Nine Hundred Sixty-Six Thousand Two Hundred Sixty-Nine (31,966,269) Shares were reserved for issuance of which Twenty-Two Million Forty-Five Thousand Three Hundred and One (22,045,301) Shares were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. Between May 28, 2003 and the date hereof, no shares of the Company’s capital stock have been issued other than pursuant to the exercise of Company Stock Options already in existence on such first date, and between May 28, 2003 and the date hereof, no stock options have been granted. Except as set forth above and for the stockholder rights (“Company Rights”) issued pursuant to that certain Preferred Stock Rights Agreement, dated as of October 3122, 19972001, as amended, between the Company and Computershare Trust Company, Inc., as Rights Agent (the “Company Rights Agreement”), as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or any Subsidiary convertible into or exchangeable or exercisable for, shares of capital stock or other voting securities of the Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companyany Subsidiary, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock other rights to acquire from the Company or any Subsidiary, and no obligations of the Company or any Subsidiary to issue any capital stock, voting securities or securities convertible into or exchangeable or exercisable for capital stock or other voting securities of the Company or any Subsidiary, and each (iv) no equity equivalent interests in the ownership or earnings of the Company or any Subsidiary is duly authorized or other similar rights. All of the outstanding Shares and validly issuedCompany Stock Options (collectively “Company Securities”) were issued in compliance with the Securities Act of 1933, fully paid as amended (the “Securities Act”), and nonassessable and free of any preemptive rightsapplicable state securities laws. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 except with respect to the Restricted Company Disclosure ScheduleShares, there are no outstanding rights or obligations of the Company or any Subsidiary to repurchase, redeem or otherwise acquire any outstanding shares of its capital stock or other ownership interests. Other than the Company Voting Agreements, there are no stockholder agreements, voting trusts or other arrangements or understandings to which the Company, the Company Board or any Subsidiary is a party, and to the Company’s knowledge, there are no other agreements, voting trusts or other arrangements or understandings, relating to the voting or registration of any shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any voting securities of the Company or either any Subsidiary. Other than treasury stock as described in the Financial Statements, nor no Shares, Company Preferred Stock or Company Stock Options are there owned by the Company or any Subsidiary. The Company has provided to Parent a true and complete list of all holders of outstanding Restricted Company Shares or Company Stock Options, the exercise or vesting schedule, the exercise price per share, and the term of each Restricted Company Share or Company Stock Option, as applicable and in the case of Company Stock Options, whether such option is a nonqualified stock option or incentive stock option, and any securities which restrictions on the Company’s right to repurchase of the Shares underlying the options, and whether or not, to the Company’s knowledge, an election under Section 83(b) of the Code is in effect with respect to such Shares that are convertible into or exchangeable for any shares Restricted Company Shares, in each case as of capital stock the date hereof. None of the terms of the Company Stock Options or either Subsidiary; Restricted Company Shares provides for accelerated vesting as a result of the execution and neither delivery of this Agreement or the consummation of the transactions contemplated hereby. Other than as disclosed in the Company’s SEC Reports filed on or before the date hereof, since the Company’s initial public offering, the Company nor either Subsidiary has not granted Company Stock Options to employees or consultants under any obligation Company Plan at an exercise price of any kind to issue any additional securities or to pay for less than the fair market value per Share at the time of grant as determined in good faith by the Company Board. (b) The Company Rights and the Shares constitute the only classes of equity securities of the Company or either Subsidiary its Subsidiaries registered or any predecessor. The Company has no outstanding bondsrequired to be registered under the Securities Exchange Act of 1934, debentures, notes or other similar obligations as amended (the holders of which have the right to vote generally with holders of Company Common Stock“Exchange Act”).

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of of: (ai) 20,000,000 30,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stockwhich, $1.00 par value per share ("Company Preferred Stock"). As as of October December 31, 1997, 7,358,817 shares were issued and outstanding and 1,099,500 shares were held in treasury and (iii) 3,891,981 5,000,000 shares of Preferred Stock, par value $.01 per share, 24,060 shares of Redeemable Preferred Stock - Series A, par value $1.00 per share and 21,940 shares of Redeemable Preferred Stock - Series B, par value $1.00 per share, no shares of which were issued and outstanding. All of the issued and outstanding shares of Company Common Stock have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of December 31, 1997, 842,500 shares of Company Common Stock were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Options issued and outstandingpursuant to the Stock Option Plans. Since December 31, 1997, no shares of the Company's capital stock have been issued other than pursuant to the exercise of Options already in existence on such date and, since December 31, 1997, no stock options have been granted. Except as set forth above in this Section 3.2(a), as of the date hereof, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company Common Stock were issuable upon or its subsidiaries, and no obligations of the exercise Company or conversion its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares equity equivalents, interests in the ownership or earnings of the Company Preferred Stock were issued and outstandingor its subsidiaries or other similar rights (including stock appreciation rights) (collectively, "Company Securities"). Since October 31There are no outstanding obligations of the Company or its subsidiaries to repurchase, 1997, except redeem or otherwise acquire any Company Securities. Except as disclosed set forth in Section 4.4 3.2(a) of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock Schedule and except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedulecontemplated by this Agreement, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or to which it is bound relating to the issuance, sale or transfer by the Company or either Subsidiary voting of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither Company. (b) Except as set forth in Section 3.2(b) of the Company nor either Subsidiary has any obligation Disclosure Schedule, all of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any kind Lien (as defined below) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same, except as may be provided as a matter of law). There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. For purposes of which have the right this Agreement, "Lien" means, with respect to vote generally with holders any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of Company Common Stockany kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares The authorized stock of common stock, $0.05 par value per share ("the Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, consists of: (i) 3,891,981 60,000,000 shares of Company Common Stock Stock, of which 32,516,383 shares were issued and outstandingoutstanding as of July 13, 1999, and (ii) 201,385 1,000,000 shares of Company Common Stock were issuable upon the exercise Preferred Stock, par value $.01 per share, of outstanding optionswhich 300,000 shares are designated as Series A Junior Participating Preferred Stock, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were which are outstanding. All of the issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and Shares have been validly issued, and are duly authorized, fully paid and nonassessable paid, non-assessable and free of any preemptive rights. As of the date hereof, other than 6,260,252 Shares are reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options. Except as set forth aboveabove and except for the Option Agreement and the Company Rights Agreement (as hereinafter defined), as of the date hereof, there are outstanding (i) no shares of stock or other voting securities of the Company; (ii) no securities of the Company or any of its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company; (iii) no options or other rights to acquire from the Company or any of its subsidiaries, and no obligations of the Company or any of its subsidiaries to issue, any stock, voting securities, or securities convertible into or exchangeable for stock or voting securities of the Company; and (iv) no equity equivalents, interests in the Company SEC Documents ownership or earnings of the Company, or other similar rights (as defined in Section 4.7including stock appreciation rights) or in Section 4.4 to (collectively, "COMPANY SECURITIES"). Except for the Company Disclosure ScheduleOption Agreement, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryany of its subsidiaries to repurchase, nor redeem or otherwise acquire any Company Securities. There are there outstanding no stockholder agreements, voting trusts or other agreements or understandings to which the Company or any securities of its subsidiaries is a party or to which are convertible into or exchangeable for it is bound relating to the voting of any shares of capital stock of the Company or either Subsidiary; and neither (other than the Voting Agreement). Section 3.2 of the Company nor either Subsidiary has any obligation Disclosure Schedule sets forth information regarding the current exercise price, the date of grant, and the number of Company Stock Options granted for each holder thereof. (b) All of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any kind Lien or any other limitation or restriction (including, any restriction on the right to issue any additional securities vote or to pay for sell the same) except as may be provided as a matter of Law. There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement, or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debenturesredeem, notes or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. For purposes of which have the right to vote generally with holders this Agreement, "LIEN" means, in respect of Company Common Stockany asset (including any security) any mortgage, lien, pledge, charge, security interest, or encumbrance of any kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. The Company's (a) As of the date hereof, the authorized capital stock of the Company consists solely of (a) 20,000,000 50,000,000 shares of common stock, $0.05 0.001 par value per share ("Company Common Stock")share, of which 26,317,673 are issued and outstanding, and (b) 10,000,000 all of which are duly authorized, validly issued, fully paid and nonassessable, and 1,000,000 shares of preferred stock, $1.00 0.001 par value per share share, of which no shares are issued and outstanding. ("Company Preferred Stock"). As b) Schedule 4.3(b) sets forth for each Subsidiary of October 31the Company, 1997in each case, as of the date hereof (i) 3,891,981 shares its name and jurisdiction of Company Common Stock were issued and outstandingincorporation or organization, (ii) 201,385 the number of authorized shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved (or equivalent) for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares each class of its capital stock except upon or other ownership interest, (iii) the exercise number of issued and outstanding shares (or equivalent) of each class of its capital stock or other ownership interest, the names of the holders thereof and the number of shares (or equivalent) held by each such optionsholder and (iv) the number of shares (or equivalent) of its capital stock or other ownership interest held in treasury. To the Company’s Knowledge, warrants all of the issued and outstanding shares (or convertible securities. Each outstanding share equivalent) of capital stock or other ownership interest of each Subsidiary of the Company and each Subsidiary is have been duly authorized and are validly issued, and, if applicable, are fully paid and nonassessable and free of any preemptive rightsnon-assessable. As of To the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure ScheduleCompany’s Knowledge, there are no authorized or outstanding options, warrants, calls, subscriptions, equity appreciation, phantom equity or other rights relating to the capital stock or other ownership interest of any Subsidiary of the Company or with respect to which any Subsidiary may be obligated to issue or sell any shares of capital stock or other ownership interests of such Subsidiary. The Company directly or indirectly owns all of the issued and outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or of each Subsidiary (free and clear of all Liens other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stockthan Permitted Liens).

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of Forty Million (a40,000,000) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), of which, as of the close of business on April 28, 2000, Fourteen Million Seven Hundred Forty-Six Thousand Nine Hundred and Sixty-Seven (b14,746,967) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, and One Million (ii1,000,000) 201,385 shares of preferred stock, of which Forty-Nine Thousand Five Hundred Eighty-Seven (49,587) have been designated as Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable Preferred Stock; Twenty-Seven Thousand One Hundred Eighty (on a contingent basis or otherwise27,180) by the Company, and (iii) no shares of Company Preferred Stock were are outstanding and no other shares of preferred stock of the Company are outstanding. All of the outstanding Shares and shares of Company Preferred Stock have been validly issued and outstandingare fully paid, nonassessable and free of preemptive rights. Since October 31As of the close of business on April 28, 19972000, approximately One Hundred Thousand (100,000) Shares were reserved for issuance and, as of the close of business on April 28, 2000, Three Million Four Thousand One Hundred and Sixty-Two (3,004,162) Shares were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options. For purposes hereof, "Company Stock Option" means any -------------------- option, warrant or other right to purchase Shares. Between the close of business on April 28, 2000 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on April 28, 2000 and, between the close of business on April 28, 2000 and the date hereof, no stock options have been granted, except as disclosed set forth in Section 4.4 3.2(a) of the Company Disclosure Schedule. Section 3.2(a) of the Company Disclosure Schedule sets forth a true and complete list of all holders of outstanding options and other awards under the Assumed Option Plans, the exercise or vesting schedule thereof, the exercise price per Share, the term of each such option or other award, whether an option is a nonqualified stock option or incentive stock option and any restrictions on exercise or sale of such option or underlying Shares. On the Closing Date, the Company shall deliver to Intel a complete and correct updated Section 3.2(a) of the Company Disclosure Schedule. Except as set forth above or in Section 3.2(a) of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights. As as of the date hereof, there are outstanding (i) no shares of capital stock or other than voting securities of the Company, (ii) no securities of the Company or any of its subsidiaries convertible into or exchangeable or exercisable for shares of capital stock or other securities of the Company, (iii) no options, preemptive or other rights to acquire from the Company or any of its subsidiaries, and, except as set forth above, publicly disclosed in the Company SEC Documents Reports (as defined below), no obligations of the Company or any of its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable or exercisable for capital stock or other securities of the Company and (iv) no equity equivalent interests in the ownership or earnings of the Company or its subsidiaries or other similar rights (collectively "Company Securities"). Except as set forth in ------------------ Section 4.73.2(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or by which it is bound relating to the issuance, sale voting or transfer by the Company or either Subsidiary registration of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessorCompany. The Company has not voluntarily accelerated the vesting of any Company Stock Options as a result of the Combination or any other change in control of the Company, and the Company has taken all action required to provide that no outstanding bondsCompany Stock Option will be exchanged for cash, debentures, notes converted into cash or other similar obligations the holders of which have into the right to vote generally with holders receive a cash payment or otherwise cashed out as a result of Company Common Stockthe Combination.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares 7,500,000 Shares, of common stock, $0.05 par value per share ("Company Common Stock")$0.01, of which, as of the close of business on August 23, 2000, 3,074,092 Shares were issued and outstanding, and (b) 10,000,000 50,000 shares of preferred stock, par value $1.00 par value per share ("Company Preferred Stock")share, of which as of the close of business on August 1, 2000, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of October 31the close of business on August 1, 19972000, approximately 1,050,000 Shares were reserved for issuance and, as of the close of business on August 1, 2000, no Shares were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options. Between the close of business on August 23, 2000 and the date hereof, no stock options have been granted. Except as set forth above, as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 no securities of the Company or any of its subsidiaries convertible into or exchangeable or exercisable for shares of Company Common Stock were issuable upon capital stock or other securities of the exercise of outstanding Company, (iii) no options, an additional 230,749 shares preemptive or other rights to acquire from the Company or any of its subsidiaries, and, except as described in the Company Common Stock were issuable upon SEC Reports (as defined below), no obligations of the exercise Company or any of options that are not currently outstanding but are reserved its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable or exercisable for issuance upon the designation of optionees by the Board of Directors capital stock or other securities of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed equity equivalent interests in Section 4.4 the ownership or earnings of the Company Disclosure Schedule, the or its subsidiaries or other similar rights (collectively "Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rightsSecurities"). As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock rights or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryany of its subsidiaries to repurchase, nor redeem or otherwise acquire any Company Securities. There are there outstanding any securities no stockholder agreements, voting trusts or other agreements or understandings to which are convertible into the Company is a party or exchangeable for by which it is bound relating to the voting or registration of any shares of capital stock of the Company. The Company or either Subsidiary; and neither has not voluntarily accelerated the Company nor either Subsidiary has any obligation vesting of any kind Company Stock Options as a result of the Offer or the Merger or any other change in control of the Company. (b) All of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any Lien or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same except as a matter of Applicable Law). There are no securities of the Company or either Subsidiary any of its subsidiaries convertible into or exchangeable or exercisable for, or other rights to acquire from the Company or any predecessorof its subsidiaries, any capital stock or other ownership interests in or any other securities of any subsidiary of the Company, and there exists no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any such capital stock. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar ownership interests in any subsidiary of the Company. For purposes of this Agreement, "Lien" means, with respect to any asset (including any security), any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset; provided, however, that the term "Lien" shall not include (i) statutory liens for Taxes that are not yet due and payable or are being contested in good faith by appropriate proceedings and are disclosed in Section 3.14 of the Company Disclosure Schedule or that are otherwise not material, (ii) statutory or common law liens to secure obligations to landlords, lessors or renters under leases or rental agreements confined to the holders premises rented, (iii) deposits or pledges made in connection with, or to secure payment of, workers' compensation, unemployment insurance, old age pension or other social security programs mandated by Applicable Law, (iv) statutory or common law liens in favor of which have the right carriers, warehousemen, mechanics and materialmen, to vote generally with holders secure claims for labor, materials or supplies and other like liens, and (v) restrictions on transfer of Company Common Stocksecurities imposed by applicable state and federal securities laws.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of of: (ai) 20,000,000 100,000,000 shares of common stockCommon Stock, $0.05 par value $.0001 per share (the "Common Stock"), of which, as of December 1, 1998, 60,868,825 shares were issued and outstanding and no shares were held in treasury, (ii) 500,000,000 shares of Class A Common Stock, par value $.0001 per Share (the "Class A Common Stock"; and collectively with the Common Stock, the "Company Common Stock"), of which, as of December 1, 1998, 28,941,950 shares were issued and outstanding and no shares were held in treasury and (biii) 10,000,000 50,000,000 shares of preferred stockPreferred Stock, $1.00 par value $.01 per share ("Company Preferred Stock")share, no shares of which are issued and outstanding. As All of October 31, 1997, (i) 3,891,981 the issued and outstanding shares of Company Common Stock have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of December 1, 1998, 713,400 shares of Class A Common Stock were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding options granted by the Company to purchase shares of Class A Common Stock (the "Company Stock Options") issued and outstandingpursuant to the Company stock option plans listed in Section 3.2(a) of the Company Disclosure Schedule. Since December 1, 1998, no shares of the Company's capital stock have been issued other than pursuant to the exercise of Company Stock Options already in existence on such date and, since December 1, 1998, no Company Stock Options have been granted. Except as set forth above in this Section 3.2(a), as of the date hereof, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company Common Stock were issuable upon or its subsidiaries, and no obligations of the exercise Company or conversion its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31equity equivalents, 1997or interests in the ownership or earnings, except as disclosed in Section 4.4 of the Company Disclosure Scheduleor its subsidiaries or other similar rights (including stock appreciation rights) (collectively, the "Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securitiesSecurities"). Each There are no outstanding share of capital stock obligations of the Company and each Subsidiary is duly authorized and validly issuedor its subsidiaries to repurchase, fully paid and nonassessable and free of redeem or otherwise acquire any preemptive rightsCompany Securities. As of the date hereof, other than Except as set forth above, in the Company SEC Documents (as defined in Section 4.73.2(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, shareholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or to which it is bound relating to the issuance, sale or transfer by the Company or either Subsidiary voting of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither Company. (b) Except as set forth in Section 3.2(b) of the Company nor either Subsidiary has any obligation Disclosure Schedule, all of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any kind Lien (as defined below) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same, except as may be provided as a matter of law). There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. For purposes of which have the right this Agreement, "Lien" means, with respect to vote generally with holders any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of Company Common Stockany kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares 30,000,000 Shares, of common stockwhich, $0.05 par value per share ("Company Common Stock")as of the date hereof 15,062,933 Shares are issued and outstanding, and (b) 10,000,000 6,000,000 shares of preferred stock, $1.00 par value $0.10 per share ("Company Preferred Stock"). As share, of October 31which, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors as of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companydate hereof, and (iii) no shares of Company Preferred Stock were are issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of All the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each and outstanding share of capital stock of the Company and each Subsidiary is duly authorized and Shares are validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than the Company has two equity incentive plans under which on the date hereof, options for a total of 517,738 Shares are outstanding, of which 271,500 are exercisable. Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) above or in Section 4.4 pursuant to the Company Disclosure Scheduleexercise of outstanding Options, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities not as of the Company or either Subsidiarydate hereof, nor are and at the Effective Time there outstanding any securities which are convertible into or exchangeable for will not be, any shares of capital stock of the Company issued or either Subsidiary; and neither outstanding or any subscriptions, options, warrants, calls, rights, convertible securities or other agreements or commitments of any character relating to issued or unissued capital stock or other securities of the Company, or otherwise obligating the Company nor or any of its subsidiaries to issue, transfer or sell any of such securities. Following the Merger, the Company will have no obligation to issue, transfer or sell any shares of its capital stock or other securities of the Company pursuant to any employee benefit plan or otherwise. (b) All of the outstanding shares of capital stock of each of the Company's subsidiaries have been validly issued, fully paid and nonassessable and are owned by either Subsidiary has any obligation the Company or its subsidiaries free and clear of any kind to issue any additional securities all material liens, charges, claims or to pay for encumbran ces. (c) The Shares constitute the only class of equity securities of the Company or either Subsidiary any of its subsidiaries registered or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations required to be registered under the holders of which have the right to vote generally with holders of Company Common StockExchange Act.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 12,000,000 shares of common capital stock, $0.05 including 6,000,000 shares of Common Stock, par value $2.00 per share ("Company the “Common Stock"”), 4,000,000 shares of Class B Common Stock, par value $2.00 per share the Class B Common Stock”), and (b) 10,000,000 2,000,000 shares of preferred stock, $1.00 par value per share Preferred Stock ("Company “Preferred Stock"”). As of October 31the date of this Agreement, 1997, (i) 3,891,981 2,604,269 shares of Company Common Stock and 1,906,786 shares of Class B Common Stock were issued and outstanding, (ii) 201,385 . No shares of Company Preferred Stock are outstanding. All of the outstanding shares of Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 and Class B Common Stock have been duly authorized and validly issued and are fully paid and nonassessable. The Company has no shares of Company Common Stock or Class B Common Stock or Preferred Stock reserved for or otherwise subject to issuance, except that (i) as of the date of this Agreement, there were issuable upon the exercise (x) 1,907,286 shares of options that are not currently outstanding but are Common Stock reserved for issuance upon the designation conversion of optionees by the Board Class B Common Stock into Common Stock and (y) 6,600 shares of Directors Common Stock subject to issuance pursuant to Company Options. Each of the Company and 154,175 outstanding shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock or other ownership interests of each of the Company and each Subsidiary Company’s Subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and owned by the Company or a direct or indirect wholly owned Subsidiary of the Company, in each case free and clear of any preemptive rightsLien. As of the date hereof, other than Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule, there are no registration rights or preemptive or other outstanding rights, options, warrants, conversion rights, stock appreciation rights, redemption rights, repurchase rights, agreements, arrangements, calls, commitments or rights of any kind which obligate the Company or any of its Subsidiaries to register, issue or sell any shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary any of its Subsidiaries or any securities or obligations convertible or exchangeable into or exercisable for, or giving any Person a right to subscribe for or acquire from the Company or any of its Subsidiaries, any securities of the Company or either Subsidiaryany of its Subsidiaries, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional no securities or to pay for securities of the Company obligations evidencing such rights are issued or either Subsidiary or any predecessoroutstanding. The Company has no does not have outstanding any bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally (or which are convertible into or exercisable for securities having the right to vote) with holders the stockholders of the Company on any matter. For purposes of this Agreement, “Lien” means, with respect to any asset (including any security) any option, claim, mortgage, lien, pledge, charge, security interest or encumbrance or material restrictions in respect of such asset. (b) Section 5.2(b) of the Company Disclosure Schedule sets forth the following information with respect to each Company Option outstanding as of the date of this Agreement: (i) the name of the person holding such Company Option, (ii) the number of shares of Common StockStock subject to such Company Option; (iii) the exercise price of such Company Option; and (iv) whether such Company Option is intended to qualify as an incentive stock option within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”). (c) Section 5.2(c) of the Company Disclosure Schedule sets forth the name of each Subsidiary and the jurisdiction of its incorporation. (d) Section 5.2(d) of the Company Disclosure Schedule sets forth the name of each Person (other than direct and indirect wholly-owned Subsidiaries) in which the Company or any of its Subsidiaries owns any equity or similar interest in or any interest convertible into or exchangeable or exercisable for any equity or similar interest in, any corporation, partnership, joint venture or other business as of the date of this Agreement, that Person’s jurisdiction of incorporation or organization and the percentage of and kind of interest owned. (e) There are no voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party with respect to the voting of any of the capital stock of the Company or any of the Subsidiaries. Other than as set forth on Section 5.2(e) of the Company Disclosure Schedule, none of the Company or any of its Subsidiaries is obligated under any registration rights or similar agreements to register any shares of capital stock of the Company or any of its Subsidiaries on behalf of any Person.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 shares Three Hundred Million (300,000,000) Shares, of common stockwhich, $0.05 par value per share as of May 28, 2003, One Hundred Twenty-Two Million Four Hundred Twenty-Six Thousand Six Hundred Sixty-Four ("Company Common Stock"), 122,426,664) Shares were issued and outstanding; and (bii) 10,000,000 Five Million (5,000,000) shares of preferred stock, $1.00 par value $0.001 per share ("Company Preferred StockCOMPANY PREFERRED STOCK"), none of which are outstanding as of the date hereof. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of May 28, 2003, an aggregate of Thirty-One Million Nine Hundred Sixty-Six Thousand Two Hundred Sixty-Nine (31,966,269) Shares were reserved for issuance of which Twenty-Two Million Forty-Five Thousand Three Hundred and One (22,045,301) Shares were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. Between May 28, 2003 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to the exercise of Company Stock Options already in existence on such first date, and between May 28, 2003 and the date hereof, no stock options have been granted. Except as set forth above and for the stockholder rights Company Rights issued pursuant to that certain Preferred Stock Rights Agreement, dated as of October 3122, 19972001, as amended, between the Company and Computershare Trust Company, Inc., as Rights Agent (the "COMPANY RIGHTS AGREEMENT"), as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or any Subsidiary convertible into or exchangeable or exercisable for, shares of capital stock or other voting securities of the Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companyany Subsidiary, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock other rights to acquire from the Company or any Subsidiary, and no obligations of the Company or any Subsidiary to issue any capital stock, voting securities or securities convertible into or exchangeable or exercisable for capital stock or other voting securities of the Company or any Subsidiary, and each (iv) no equity equivalent interests in the ownership or earnings of the Company or any Subsidiary is duly authorized or other similar rights. All of the outstanding Shares and validly issuedCompany Stock Options (collectively "COMPANY SECURITIES") were issued in compliance with the Securities Act of 1933, fully paid as amended in the Securities Act, and nonassessable and free of any preemptive rightsapplicable state securities laws. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 except with respect to the Restricted Company Disclosure ScheduleShares, there are no outstanding rights or obligations of the Company or any Subsidiary to repurchase, redeem or otherwise acquire any outstanding shares of its capital stock or other ownership interests. Other than the Company Voting Agreements, there are no stockholder agreements, voting trusts or other arrangements or understandings to which the A-14 Company, the Company Board or any Subsidiary is a party, and to the Company's knowledge, there are no other agreements, voting trusts or other arrangements or understandings, relating to the voting or registration of any shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any voting securities of the Company or either any Subsidiary. Other than treasury stock as described in the Financial Statements, nor no Shares, Company Preferred Stock or Company Stock Options are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of owned by the Company or either any Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the provided to Parent a true and complete list of all holders of which have outstanding Restricted Company Shares or Company Stock Options, the exercise or vesting schedule, the exercise price per share, and the term of each Restricted Company Share or Company Stock Option, as applicable and in the case of Company Stock Options, whether such option is a nonqualified stock option or incentive stock option, and any restrictions on the Company's right to vote generally repurchase of the Shares underlying the options, and whether or not, to the Company's knowledge, an election under Section 83(b) of the Code is in effect with holders respect to such Shares that are Restricted Company Shares, in each case as of the date hereof. None of the terms of the Company Common StockStock Options or Restricted Company Shares provides for accelerated vesting as a result of the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby. Other than as disclosed in the Company's SEC Reports filed on or before the date hereof, since the Company's initial public offering, the Company has not granted Company Stock Options to employees or consultants under any Company Plan at an exercise price of less than the fair market value per Share at the time of grant as determined in good faith by the Company Board.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of: (i) 22,000,000 Shares, of (a) 20,000,000 shares which 5,127,775 Shares were issued and outstanding as of common stockthe close of business on March 3, $0.05 par value per share ("Company Common Stock")2000 and none of which are held in the Company's treasury, and (bii) 10,000,000 2,000,000 shares of preferred stock, $1.00 par value $.001 per share (the "Company Preferred StockPREFERRED STOCK"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were which are outstanding. All of the issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and Shares have been validly issued, and are duly authorized, fully paid and nonassessable paid, non-assessable and free of any preemptive rights. As of March 3, 2000, 952,541 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the date hereofexercise of outstanding Company Stock Options issued pursuant to the Company Option Plans. Since September 30, 1999, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such date. Except as set forth above, in as of the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Scheduledate hereof, there are outstanding (i) no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights voting securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any Company; (ii) no securities of the Company or either Subsidiary, nor are there outstanding any securities which are of its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company; (iii) except for the Company Rights Agreement (as hereinafter defined) and the Stock Option Agreement, no options or other rights to acquire from the Company or any of its subsidiaries, and no obligations of the Company or any of its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company; and (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of its subsidiaries or other similar rights (including stock appreciation rights) (collectively, "COMPANY SECURITIES"). There are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. There are no stockholder agreements (other than the Voting Agreements dated as of the date hereof between Parent and each of Edward Jankowski and Peter Jankowski), voting trusts or other agreements xx xxxxxxxxxxxxgs to xxxxx xxx Xxxxany or any of its subsidiaries is a party or to which it is bound relating to the voting of any shares of capital stock of the Company or either Subsidiary; and neither Company. Section 3.2 of the Company nor either Subsidiary has Disclosure Schedule sets forth information regarding the current exercise price, date of grant and number granted Company Stock Options for each holder thereof. Following the Effective Time, no holder of Company Stock Options will have any obligation right to receive shares of common stock of the Surviving Corporation upon exercise of the Company Stock Options. (b) All of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any kind Lien (as hereinafter defined) or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same, except as may be provided as a matter of Law). There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. For purposes of which have the right this Agreement, "LIEN" means, with respect to vote generally with holders any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of Company Common Stockany kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of of: (ai) 20,000,000 125,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), par value $.001 per share, of which 16,592,863 shares are issued and outstanding as of the date hereof and (bii) 10,000,000 25,000,000 shares of preferred stock, $1.00 par value $.001 per share ("Company Preferred Stock"). As share, of October 31, 1997, (i) 3,891,981 which no shares of Company Common Stock were are issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors as of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstandingdate hereof. Since October 31, 1997, except as disclosed in Section 4.4 All of the Company Disclosure Scheduleoutstanding Shares are duly authorized, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable non-assessable and are free of any preemptive rights. As of the date hereof, other than (A) 6,000,000 Shares are reserved for issuance under the Company's Long-Term Incentive Plan, of which 914,500 Shares are issuable upon the exercise of options granted thereunder, (B) 1,000,000 Shares are reserved for issuance under the Company's Director Option Plan, of which 50,000 Shares are issuable upon the exercise of options granted thereunder, (C) options to purchase 1,600,000 Shares upon the exercise of non-plan options granted to directors and executive officers of the Company are outstanding, and (D) 1,950,275 Shares are available for purchase pursuant to the Company Warrants. Except as set forth above, in the immediately preceding sentence, there are no Company SEC Documents Stock Options outstanding under any Company Option Plan and no Shares subject to any Company Warrant. (b) As of the date hereof, the Company has issued convertible promissory notes in the aggregate principal amount of $820,000, which, at each holder's option, are convertible, on a dollar-for-dollar basis, into Company Common Stock at $2.00 per share (the "CONVERTIBLE NOTES"). (c) Except as defined set forth in this Section 3.2, as of the date hereof, there are no outstanding (i) shares of capital stock or other voting securities of the Company; (ii) securities of the Company or any of its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company; (iii) options or other rights to acquire from the Company or any of its subsidiaries, or obligations of the Company or any of its subsidiaries to issue, any capital stock, voting securities, or securities convertible into or exchangeable for capital stock or voting securities of the Company; or (iv) equity equivalents, interests in the ownership or earnings of the Company, or other similar rights (including stock appreciation rights) (collectively, "COMPANY SECURITIES"). Except as set forth in Section 4.7) or in Section 4.4 to 3.2 of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryany of its subsidiaries to repurchase, nor redeem or otherwise acquire any Company Securities. There are there outstanding no stockholder agreements, voting trusts or other agreements or understandings to which the Company or any securities of its subsidiaries is a party or to which are convertible into or exchangeable for it is bound relating to the voting of any shares of capital stock of the Company (other than the applicable Voting Agreement). (d) All of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or either Subsidiary; indirectly, free and neither the Company nor either Subsidiary has any obligation clear of any kind Lien (as defined below) or any other limitation or restriction (including, without limitation, any restriction on the right to issue any additional securities vote or to pay for sell the same) except as may be provided as a matter of Law. Except as set forth in this Section 3.2, there are no debt or equity securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement, or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debenturesredeem, notes or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. None of which have the right to vote generally with holders Company's subsidiaries owns any capital stock of Company Common Stockthe Company. For purposes of this Agreement, "LIEN" means, in respect of any asset (including any security) any mortgage, lien, pledge, charge, security interest, or encumbrance of any kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31December 19, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule2013, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of authorized capital stock of the Company consists of 50,000,000 shares of Common Stock, of which 14,644,626 shares are issued and each Subsidiary is 14,348,954 shares are outstanding. There are no shares of preferred stock authorized under the Governing Documents of the Company, and no shares of preferred stock of the Company are issued or outstanding. As of December 19, 2013 are outstanding employee stock options to purchase an aggregate of 2,491,293 shares of Common Stock (of which options to purchase an aggregate of 1,531,644 are exercisable and RSUs with respect to an aggregate of 28,000 shares of Common Stock (of which zero RSUs are vested). Each such stock option or RSU was granted under and in accordance with the terms of the Company Stock Option Plans. All of the issued and outstanding shares of Common Stock are duly authorized authorized, validly issued and validly issued, fully paid and nonassessable and all shares of Common Stock that may be issued pursuant to any stock option or RSU will be, when issued in accordance with the respective terms thereof, duly authorized and validly issued and fully paid, and, in each case, are and will be free and clear of any preemptive rights, restrictions on transfer (other than restrictions under applicable federal, state and other securities laws) or Liens (other than Permitted Liens). Except as set forth on Schedule 4.2(a) of the Company Disclosure Schedules, as of the date of this Agreement, there are no outstanding (i) other equity securities of the Company, (ii) securities of the Company convertible into or exchangeable for equity securities of the Company, or (iii) options or other rights to acquire from the Company, and no obligations of the Company to issue, any equity securities or securities convertible into or exchangeable for equity securities of the Company. As of the date hereof, other than all issued and outstanding shares of Common Stock are held of record by the Persons and in such amounts as set forth above, in the Company SEC Documents (as defined in Section 4.7on Schedule 4.2(a) or in Section 4.4 to of the Company Disclosure Schedules. As of the Closing, all of the issued and outstanding shares of Common Stock will be held of record by the Persons and in such amounts as set forth on the Merger Consideration Allocation Schedule. Schedule 4.2(a) of the Company Disclosure Schedules sets forth a true and complete list, as of the date hereof, of all holders of Current Options, including, with respect to each holder thereof, as applicable, (i) whether each such Current Option, is vested or unvested as of the date of this Agreement, and whether such Current Option is subject to vesting as a result of the transactions herein, (ii) the exercise price per underlying share, if applicable, (iii) the term of each such Current Option, (iv) whether such Current Option is a nonqualified stock option or incentive stock option and (v) whether the optionee is an employee of the Company on the date hereof. Prior to the date hereof, the Company has provided to Parent a copy of each form of award agreement that evidences the grant of Current Options and RSUs, and, to the extent that any award has been granted that is evidenced by an award agreement that deviates from such form, the Company has provided to Parent a copy of such award agreement. Other than the Company Stock Option Plans, the Company does not have, and never has had, a stock option, stock incentive, phantom stock, stock-based performance, restricted stock unit, equity option or other equity or equity-based award plan. The Company does not have in place any management “carve out” plan. The Company has made available to Parent all Contracts containing rights to indemnification for acts or omissions occurring prior to or as of the Closing Date in favor of the Covered Parties, whether located in Governing Documents, indemnity agreements or as provided pursuant to a resolution of the Company Board or the board of directors of such Subsidiary, or otherwise. (b) Except as set forth on Schedule 4.2(b) of the Company Disclosure Schedules the Company and its Subsidiaries do not directly or indirectly own any equity, debt or similar interest in, or any interest convertible into or exchangeable or exercisable for, at any time, any equity or similar interest in, or control of, directly or indirectly, any other Person, and the Company and its Subsidiaries are not, directly or indirectly, a party to, member of or partner in any partnership, joint venture or similar business entity. Schedule 4.2(b) of the Company Disclosure Schedules sets forth the name, owner, jurisdiction of formation or organization (as applicable) and percentages of outstanding equity securities owned, directly or indirectly, by the Company and each of its Subsidiaries, with respect to each Person of which the Company and each of its Subsidiaries own directly or indirectly, any equity, debt or similar interest in, or any interest convertible into or exchangeable or exercisable for, at any time, any equity interest. Except as set forth on Schedule 4.2(b) of the Company Disclosure Schedules, all outstanding equity securities of each Subsidiary of the Company have been duly authorized and validly issued and are fully paid and nonassessable, are free and clear of any preemptive rights (except to the extent provided by Applicable Law and other than such rights as may be held by the Company or its Subsidiaries), restrictions on transfer (other than restrictions under applicable federal, state and other securities laws) or Liens (other than Permitted Liens) and are owned, beneficially and of record, by the Company or its Subsidiaries. Except as set forth on Schedule 4.2(b) of the Company Disclosure Schedules, there are no (i) outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any equity securities of the Company or either Subsidiaryits Subsidiaries, nor are there (ii) outstanding any securities which are subscriptions, preemptive rights, warrants, calls or options to acquire, or instruments convertible into or exchangeable for for, or agreements or understandings with respect to any shares of capital stock equity interests of the Company or either Subsidiary; and neither its Subsidiaries, (iii) Liens, proxies, voting trusts, or voting agreements with respect to the Company nor either Subsidiary has any obligation sale, issuance or voting of any kind to issue any additional securities equity interests or to pay for securities shares of common stock (whether outstanding or issuable upon the conversion, exchange or exercise of outstanding shares of common stock) of the Company or either Subsidiary or any predecessor. The Company has its Subsidiaries, and no outstanding bonds, debentures, notes or other similar obligations Indebtedness of the holders of which have Company having the right to vote generally with (or convertible into, or exchangeable for, securities having the right to vote) on any matters on which holders of the equity interests or securities of the Company Common Stockmay vote, (iv) obligations to redeem, repurchase or otherwise acquire shares of common stock of the Company or its Subsidiaries and (v) outstanding or authorized stock appreciation, phantom stock, profit participation or other similar rights with respect to capital stock of, or other equity or voting interests in, the Company or its Subsidiaries; in each case of clauses (ii) or (iii) above, pursuant to any Applicable Law (other than any limitations or restrictions on transferability under any federal or state securities or “blue sky” laws), any Governing Document of the Company or its Subsidiaries or any Contract to which the Company or its Subsidiaries are party.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 of: 40,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), Stock and (b) 10,000,000 20,000,000 shares of preferred stock, par value $1.00 par value per share (the "Company Preferred StockPREFERRED STOCK"). As of October 31June 9, 19971999, (i) 3,891,981 14,276,682 shares of Company Common Stock were are issued and outstanding, (ii) 201,385 no shares of Company Common the Preferred Stock were issuable upon are outstanding. All of the exercise Shares have been validly issued, and are fully paid, nonassessable and free of outstanding optionspreemptive rights. As of June 9, an additional 230,749 shares 1999, a total of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but 1,498,920 Shares are reserved for issuance upon pursuant to outstanding Stock Options under the designation of optionees by the Board of Directors Company Stock Plans, and no other Shares are subject to issuance pursuant to Stock Options. Set forth in Section 3.2(a) of the Company Disclosure Schedules is a complete and 154,175 accurate list of the Company Stock Plans and the number of Shares reserved for issuance pursuant to Stock Options outstanding as of June 9, 1999 under each such Company Stock Plan, and no other Shares are subject to issuance pursuant to such Company Stock Plans. Since June 9, 1999, no shares of the Company's capital stock have been issued other than pursuant to Stock Options set forth on the Stock Option List and, since June 9, 1999, no stock options have been granted. Except as set forth above and except for the Rights to, among other things, purchase Series A Participating Preferred Stock issued pursuant to the Rights Agreement, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company Common Stock were issuable upon or any of its Subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the exercise Company, (iii) no options or conversion other rights to acquire from the Company or any of outstanding warrants its Subsidiaries, and no obligations of the Company or any of its Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities granted or issuable (on a contingent basis or otherwise) by of the Company, and (iiiiv) no shares equity equivalents, interests in the ownership or earnings of the Company Preferred Stock were issued and outstandingor any of its Subsidiaries or other similar rights (collectively, "COMPANY SECURITIES"). Since October 31There are no outstanding obligations of the Company or any of its Subsidiaries to repurchase, 1997, except redeem or otherwise acquire any Company Securities. (b) Except as disclosed set forth in Section 4.4 3.2(b) of the Company Disclosure Schedule, all of the Company has not issued any shares of its outstanding, capital stock except upon the exercise of such optionsof, warrants or convertible securities. Each outstanding share of capital stock other ownership interests in, each Subsidiary of the Company Company, is owned by the Company, directly or indirectly, free and each Subsidiary is duly authorized and clear of any Lien or any other limitation or restriction (including any restriction on the right to vote or sell the same, except as may be provided as a matter of law). All such shares have been validly issued, fully paid and nonassessable nonassessable, and have been issued free of any preemptive rights. As There are no securities of the date hereofCompany or any of its Subsidiaries convertible into or exchangeable for, no options or other than as set forth above, in rights to acquire from the Company SEC Documents or any of its Subsidiaries, and no other contract, understanding, arrangement or obligation (as defined in Section 4.7whether or not contingent) providing for the issuance or in Section 4.4 to sale, directly or indirectly, of any capital stock or other ownership interests in, or any other securities of, any Subsidiary of the Company. There are no contractual obligations of the Company Disclosure Scheduleor any of its Subsidiaries to repurchase, there are no redeem or otherwise acquire any outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of ownership interests in any type relating to the issuance, sale or transfer by the Company or either Subsidiary of the Company. For purposes of this Agreement, "LIEN" means, with respect to any securities of the Company asset (including, without limitation, any security) any option, claim, mortgage, lien, pledge, charge, security interest or either Subsidiary, nor are there outstanding any securities which are convertible into encumbrance or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation restrictions of any kind to issue any additional securities or to pay for securities in respect of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stocksuch asset.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 30,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), stock and (b) 10,000,000 4,259,350 shares of preferred stockstock of which, $1.00 par value per share ("Company Preferred Stock"). As as of October 31June 28, 19971999, (i) 3,891,981 8,280,765 shares of Company Common Stock common stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock preferred stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any All outstanding shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of June 28, 1999, Options (as hereinafter defined) to purchase an aggregate of 1,242,960 Shares were outstanding and the weighted average exercise price of such Options was $6.25 per Share, provided, that an aggregate of 3,606 additional shares of the Company's common stock may be issued in connection with the ESPP prior to the Effective Time. Except as set forth above, there are outstanding (i) no shares of capital stock or other securities of the Company, (ii) no securities of the Company convertible into or exchangeable for shares of capital stock or securities of the Company, (iii) no options, subscriptions, warrants, convertible securities, calls or other rights to acquire from the Company, and no obligation of the Company to issue, deliver or sell any capital stock, securities or securities convertible into or exchangeable for capital stock or securities of the Company, and (iv) no equity equivalents, interests in the ownership or earnings of the Company or other similar rights (collectively, "COMPANY SECURITIES"). There are no outstanding obligations of the Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities, other than the Company's obligations hereunder with respect to the 1994 Options, 1995 Options and Director Options as contemplated by Section 2.8(a), (b) and (c), respectively, and the Company's obligations under the ESPP as contemplated by Section 2.8(d). Except as set forth on Schedule 4.2 each Subsidiary of the outstanding shares of capital stock of each of the Company's Subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and is directly or indirectly owned by the Company, free and clear of all security interests, liens, claims, pledges, charges, voting agreements or other encumbrances of any preemptive rightsnature whatsoever (collectively, "LIENS"). As The Company is directly or indirectly the record (or legal and registered) and beneficial owner of all of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock of each of such entities as set forth on Schedule 4.1(d), there are no proxies with respect to such shares, and no equity securities of any of such entities are or subscriptions, may be required to be issued by reason of any options, warrants, putsscrip, callsrights to subscribe for, agreementscalls or commitments of any character whatsoever relating to, understandings, claims or other commitments securities or rights convertible into or exchangeable for, shares of any type relating to the issuance, sale or transfer by the Company or either Subsidiary capital stock of any such entity, and there are no contracts, commitments, understandings or arrangements by which any such entity is bound to issue additional shares of its capital stock or securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stocksuch shares.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of The authorized capital stock of the Company consists of 1,100,000 Common Shares, of which 935,452 shares are issued and each Subsidiary outstanding (excluding treasury shares) as of the date that is three Business Days prior to the date of this Agreement (the “Measurement Date”) and 100,000 shares of Preferred Stock, par value $0.01 per share, none of which is issued and outstanding as of the date of this Agreement. All of the issued and outstanding Common Shares have been duly authorized and validly issued, issued and are fully paid and nonassessable and free of any preemptive rightsnonassessable. As of the date hereofMeasurement Date, other than there are Stock Options to purchase in the aggregate 74,400 Common Shares. As of the Measurement Date, 22,179 shares of capital stock are held by the Company as treasury shares. Schedule 3.6(a) sets forth, as of the Measurement Date, (i) all holders of record of issued and outstanding Common Shares and (ii) all holders of an outstanding Stock Option, together with the grant date, vesting schedule, exercise price and number of Common Shares subject thereto for such Stock Options. (b) Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule3.6(a), there are no outstanding shares of capital stock or subscriptions, options, warrants, putsrights, callspreemptive rights or other similar rights or other securities convertible into or exchangeable or exercisable for shares of the capital stock of the Company, agreements, understandings, claims or any other commitments or rights agreements providing for the issuance of any type relating to additional shares, the issuance, sale of treasury shares or transfer by for the Company repurchase or either Subsidiary redemption of any securities shares of the capital stock of the Company or either Subsidiaryany other agreements of any kind which may obligate the Company to issue, nor are there purchase, redeem or otherwise acquire any of its capital stock. (c) The outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company’s Subsidiaries have been duly authorized and validly issued and are fully paid and nonassessable. The Company or either Subsidiary; one or more of its Subsidiaries owns of record and neither beneficially all the Company nor either Subsidiary has issued and outstanding shares of capital stock of such Subsidiaries free and clear of any obligation Liens, other than Permitted Liens. There are no outstanding options, warrants, rights, preemptive rights or other similar rights or other securities exercisable or exchangeable for any capital stock of such Subsidiaries, any other commitments or agreements providing for the issuance of additional shares, the sale of treasury shares or for the repurchase or redemption of shares of such Subsidiaries’ capital stock or any other agreements of any kind to issue which may obligate any additional securities or to pay for securities Subsidiary of the Company to issue, purchase, register for sale, redeem or either Subsidiary or otherwise acquire any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stockits capital stock.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) of: 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stockwhich, $1.00 par value per share ("Company Preferred Stock"). As as of October 31June 15, 19971998, (i) 3,891,981 7,809,801 shares of Company Common Stock were issued and outstanding, (ii) 201,385 and 2,000,000 shares of preferred stock, par value $0.01 per share, no shares of which are issued or outstanding. All of the shares of Company Common Stock have been validly issued, and are fully paid, nonassessable and free of preemptive rights. As of June 15, 1998, approximately 675,272 shares of Company Common Stock were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding optionsCompany Stock Options. Since May 4, an additional 230,749 1998, no shares of the Company's capital stock have been issued other than pursuant to Company Common Stock were issuable upon Options already in existence on such date, and, since May 4, 1998, no stock options have been granted. Except as set forth above, there are outstanding (i) no shares of capital stock or other voting securities of the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors Company, (ii) no securities of the Company and 154,175 or its Subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company Common Stock were issuable upon or its Subsidiaries, and no obligations of the exercise Company or conversion its Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares equity equivalents, interests in the ownership or earnings of the Company Preferred Stock were issued and outstandingor its Subsidiaries or other similar rights (collectively, "Company Securities"). Since October 31There are no outstanding obligations of the Company or its Subsidiaries to repurchase, 1997, except redeem or otherwise acquire any Company Securities. (b) Except as disclosed set forth in Section 4.4 2.2(b) of the Company Disclosure Schedule, all of the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized owned by the Company, directly or indirectly, free and validly issued, fully paid and nonassessable and free clear of any preemptive rightsLien (as hereinafter defined) or any other limitation or restriction (including any restriction on the right to vote or sell the same, except as may be provided as a matter of law). As There are no securities of the date hereofCompany or its Subsidiaries issued and outstanding that are convertible into or exchangeable for, no options or other than as set forth above, in rights to acquire from the Company SEC Documents or its Subsidiaries, and no other contract, understanding, arrangement or obligation (as defined in Section 4.7whether or not contingent) providing for the issuance or in Section 4.4 to sale, directly or indirectly, of any capital stock or other ownership interests in, or any other securities of, any Subsidiary. There are no outstanding contractual obligations of the Company Disclosure Scheduleor its Subsidiaries to repurchase, there are no redeem or otherwise acquire any outstanding shares of capital stock or subscriptionsother ownership interests in any Subsidiary. For purposes of this Agreement, options"Lien" means, warrantswith respect to any asset (including, putswithout limitation, callsany security) any mortgage, agreementslien, understandingspledge, claims charge, security interest or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation encumbrance of any kind to issue any additional securities or to pay for securities in respect of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stocksuch asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares 25,000,000 Shares, of common which, as of June 20, 1998, 8,241,152 Shares were issued and outstanding and 1,439,094 Shares were held as treasury stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value $.01 per share ("Company Preferred Stock")share, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of October 31June 20, 19971998, 909,270 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. Since June 20, 1998 no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such date, and since June 20, 1998 no stock options have been granted. Except as set forth above, as of the date hereof there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or its subsidiaries convertible into or exchangeable for shares of Company Common Stock were issuable upon the exercise or conversion capital stock of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of options or other rights to acquire from the Company Preferred Stock were issued or its subsidiaries and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 no obligations of the Company Disclosure Schedule, the Company has not issued or its subsidiaries to issue any shares of its capital stock except upon the exercise of such options, warrants or securities convertible securities. Each outstanding share of into or exchangeable for capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than as set forth above, (iv) no equity equivalent interests in the Company SEC Documents (as defined in Section 4.7) ownership or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities earnings of the Company or either Subsidiaryits subsidiaries or other similar rights (collectively "Company Securities"). There are no outstanding obligations of the Company or its subsidiaries to repurchase, nor redeem or otherwise acquire any Company Securities. There are there outstanding any securities no stockholder agreements, voting trusts or other agreements or understandings to which are convertible into the Company is a party or exchangeable for by which it is bound relating to the voting or registration of any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities preemptive rights with respect thereto. (b) Except as set forth in Section 2.2 of the Company Disclosure Schedule, all of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or either Subsidiary indirectly, free and clear of any Lien (as defined below) or any predecessor. The Company has no outstanding bonds, debentures, notes other limitation or other similar obligations the holders of which have restriction (including any restriction on the right to vote generally or sell the same except as may be provided as a matter of law). For purposes of this Agreement, "Lien" means, with holders respect to any asset (including without limitation any security), any mortgage, lien, pledge, charge, security interest or encumbrance of Company Common Stockany kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) of: 50,000,000 Common Shares and 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value $0.01 per share ("Company Preferred StockShares"). As of October 31March 3, 19972000, (i) 3,891,981 shares of Company 13,753,359 Common Stock Shares were issued and outstanding and no Preferred Shares were outstanding. All Common Shares have been duly authorized, validly issued, and are fully paid, nonassessable and free of preemptive rights or other similar rights (ii) 201,385 except for vesting and transfer restrictions on restricted shares issued under the Stock Plans). The Company has no commitments to issue or deliver any Common Shares or Preferred Shares except that, as of Company the date hereof, a total of 2,185,713 Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but Shares are reserved for issuance upon pursuant to outstanding Options under the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the CompanyPlans. Since March 3, and (iii) 2000, no shares of Company Preferred Stock were the Company's capital stock have been issued other than pursuant to Options already in existence on such date, and outstandingno Options have been granted. Since October 31, 1997, except as disclosed in Section 4.4 4.2 of the Company Disclosure ScheduleSchedule contains a correct and complete list of each outstanding Option, including the Company has not issued any shares holder, date of its capital stock except upon the grant, exercise price and number of such options, warrants or convertible securitiesShares subject thereto. Each of the outstanding share shares of capital stock or other securities of each of the Company and each Subsidiary Company's Subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and owned by the Company or by a direct or indirect wholly owned Subsidiary of the Company, free and clear of any preemptive rightsLien (as defined below). As of the date hereof, other than Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) above or in Section 4.4 to 4.2 of the Company Disclosure Schedule, there are no Common Shares or Preferred Shares authorized, reserved, issued or outstanding shares of capital stock and there are no preemptive or other outstanding rights, subscriptions, options, warrants, putsstock appreciation rights, callsredemption rights, repurchase rights, convertible, exercisable, or exchangeable securities or other agreements, understandings, claims arrangements or other commitments or rights of any type character relating to the issuance, sale issued or transfer by unissued share capital or other ownership interest of the Company or either Subsidiary any of its Subsidiaries or any other securities or obligations convertible or exchangeable into or exercisable for, or giving any Person a right to subscribe for or acquire, any securities of the Company or either Subsidiaryits Subsidiaries, nor and no securities evidencing such rights are there outstanding any securities which are convertible into authorized, issued or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessoroutstanding. The Company has no does not have outstanding any bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally (or convertible or exchangeable into or exercisable for securities having the right to vote) with holders the stockholders of the Company Common Stockon any matter. For purposes of this Agreement, "Lien" means, with respect to any asset (including any security) any option, claim, mortgage, lien, pledge, charge, security interest or encumbrance or restrictions of any kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares 60,000,000 Shares, of common stockwhich, $0.05 par value per share ("Company Common Stock")as of October 31, 1999, 14,858,566 Shares were issued and (b) 10,000,000 outstanding and 3,500,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock")none of which is outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of October 31, 19971999, approximately 617,909 Shares were reserved for future option grants and, as of October 31, 1999, 2,634,378 were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. The maximum number of shares that may be issued under the Employee Stock Purchase Plan is 100,000 shares, of which, as of October 31, 1999, all shares have been issued. Between October 31, 1999 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such first date, and between October 31, 1999 and the date hereof, no stock options have been granted. Except as set forth above, as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 no securities of the Company or any of its subsidiaries convertible into or exchangeable or exercisable for shares of Company Common Stock were issuable upon capital stock or other securities of the exercise of outstanding Company, (iii) no options, an additional 230,749 shares preemptive or other rights to acquire from the Company or any of its subsidiaries, and, except as described in the Company Common Stock were issuable upon SEC Reports (as defined below), no obligations of the exercise Company or any of options that are not currently outstanding but are reserved its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable or exercisable for issuance upon the designation of optionees by the Board of Directors capital stock or other securities of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares equity equivalent interests in the ownership or earnings of the Company Preferred Stock were issued and outstandingor its subsidiaries or other similar rights (collectively "Company Securities"). Since October 31, 1997, except Except as disclosed set forth in Section 4.4 2.2(a) of the Company Disclosure Schedule, as of the date hereof, there are no outstanding rights or obligations of the Company has not issued or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. There are no stockholder agreements, voting trusts or other agreements or understandings to which the Company is a party or by which it is bound relating to the voting or registration of any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company. The Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free has not voluntarily accelerated the vesting of any preemptive rights. As Company Stock Options as a result of the date hereofMerger or any other change in control of the Company. No Shares are held by the Company's subsidiaries. (b) All of the outstanding capital stock of the Company's subsidiaries owned by the Company is owned, directly or indirectly, free and clear of any Lien or any other than limitation or restriction (including any restriction on the right to vote or sell the same except as may be provided as a matter of Applicable Law). Except as set forth above, in the Company SEC Documents (as defined in Section 4.72.2(b) or in Section 4.4 to of the Company Disclosure Schedule, there are no (i) securities of the Company or any of its subsidiaries convertible into or exchangeable or exercisable for, (ii) options or (iii) other rights to acquire from the Company or any of its subsidiaries any capital stock or other ownership interests in or any other securities of any subsidiary of the Company, and there exists no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any such capital stock. There are no outstanding contractual obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights ownership interests in any subsidiary of any type relating to the issuance, sale or transfer by Company. (c) The Shares constitute the Company or either Subsidiary only class of any equity securities of the Company or either Subsidiaryits subsidiaries registered or required to be registered under the Securities Exchange Act of 1934, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of as amended (the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock"Exchange Act").

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares The authorized stock of common stock, $0.05 par value per share ("the Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, consists of: (i) 3,891,981 60,000,000 shares of Company Common Stock Stock, of which 32,516,383 shares were issued and outstandingoutstanding as of July 13, 1999, and (ii) 201,385 1,000,000 shares of Company Common Stock were issuable upon the exercise Preferred Stock, par value $.01 per share, of outstanding optionswhich 300,000 shares are designated as Series A Junior Participating Preferred Stock, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were which are outstanding. All of the issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and Shares have been validly issued, and are duly authorized, fully paid and nonassessable paid, non-assessable and free of any preemptive rights. As of the date hereof, other than 6,260,252 Shares are reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options. Except as set forth aboveabove and except for the Option Agreement and the Company Rights Agreement (as hereinafter defined), as of the date hereof, there are outstanding (i) no shares of stock or other voting securities of the Company; (ii) no securities of the Company or any of its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company; (iii) no options or other rights to acquire from the Company or any of its subsidiaries, and no obligations of the Company or any of its subsidiaries to issue, any stock, voting securities, or securities convertible into or exchangeable for stock or voting securities of the Company; and (iv) no equity equivalents, interests in the Company SEC Documents ownership or earnings of the Company, or other similar rights (as defined in Section 4.7including stock appreciation rights) or in Section 4.4 to (collectively, "COMPANY SECURITIES"). Except for the Company Disclosure ScheduleOption Agreement, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryany of its subsidiaries to repurchase, nor redeem or otherwise acquire any Company Securities. There are there outstanding no stockholder agreements, voting trusts or other agreements or understandings to which the 9 18 Company or any securities of its subsidiaries is a party or to which are convertible into or exchangeable for it is bound relating to the voting of any shares of capital stock of the Company or either Subsidiary; and neither (other than the Voting Agreement). Section 3.2 of the Company nor either Subsidiary has any obligation Disclosure Schedule sets forth information regarding the current exercise price, the date of grant, and the number of Company Stock Options granted for each holder thereof. (b) All of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or indirectly, free and clear of any kind Lien or any other limitation or restriction (including, any restriction on the right to issue any additional securities vote or to pay for sell the same) except as may be provided as a matter of Law. There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement, or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debenturesredeem, notes or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. For purposes of which have the right to vote generally with holders this Agreement, "LIEN" means, in respect of Company Common Stockany asset (including any security) any mortgage, lien, pledge, charge, security interest, or encumbrance of any kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock of the Company consists solely of (a) of: 50,000,000 Common Shares and 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value $0.01 per share ("Company Preferred StockShares"). As of October 31March 3, 19972000, (i) 3,891,981 shares of Company 13,753,359 Common Stock Shares were issued and outstanding and no Preferred Shares were outstanding. All Common Shares have been duly authorized, validly issued, and are fully paid, nonassessable and free of preemptive rights or other similar rights (ii) 201,385 except for vesting and transfer restrictions on restricted shares issued under the Stock Plans). The Company has no commitments to issue or deliver any Common Shares or Preferred Shares except that, as of Company the date hereof, a total of 2,185,713 Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but Shares are reserved for issuance upon pursuant to outstanding Options under the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the CompanyPlans. Since March 3, and (iii) 2000, no shares of Company Preferred Stock were the Company's capital stock have been issued other than pursuant to Options already in existence on such date, and outstandingno Options have been granted. Since October 31, 1997, except as disclosed in Section 4.4 4.2 of the Company Disclosure ScheduleSchedule contains a correct and complete list of each outstanding Option, including the Company has not issued any shares holder, date of its capital stock except upon the grant, exercise price and number of such options, warrants or convertible securitiesShares subject thereto. Each of the outstanding share shares of capital stock or other securities of each of the Company and each Subsidiary Company's Subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and owned by the Company or by a direct or indirect wholly owned Subsidiary of the Company, free and clear of any preemptive rightsLien (as defined below). As of the date hereof, other than Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) above or in Section 4.4 to 4.2 of the Company Disclosure Schedule, there are no Common Shares or Preferred Shares authorized, reserved, issued or outstanding shares of capital stock and there are no preemptive or other outstanding rights, subscriptions, options, warrants, putsstock appreciation rights, callsredemption rights, repurchase rights, convertible, exercisable, or exchangeable securities or other agreements, understandings, claims arrangements or other commitments or rights of any type character relating to the issuance, sale issued or transfer by unissued share capital or other ownership interest of the Company or either Subsidiary any of its Subsidiaries or any other securities or obligations convertible or exchangeable into or exercisable for, or giving any Person a right to subscribe for or acquire, any securities of the Company or either Subsidiaryits Subsidiaries, nor and no securities evidencing such rights are there outstanding any securities which are convertible into authorized, issued or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessoroutstanding. The Company has no does not have outstanding any bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally (or convertible or exchangeable into or exercisable for securities having the right to vote) with holders the stockholders of the Company Common Stockon any matter. For purposes of this Agreement, "Lien" means, with respect to any asset (including any security) any option, claim, mortgage, lien, pledge, charge, security interest or encumbrance or restrictions of any kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 30,000,000 shares of common stockCommon Stock, $0.05 par value $.01 per share share, of which, as of the date of this Agreement, 5,843,612 shares of Common Stock are issued and outstanding and ("Company ii) 1,000,000 shares of Preferred Stock, par value $.001 per share, of which, as of the date of this Agreement, no shares are issued and outstanding. All outstanding shares of Common Stock")Stock have been duly authorized and validly issued, and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock")are fully paid and nonassessable. As of October 31the date of this Agreement, 1997the Company has 6,926,976 outstanding options and warrants to purchase common stock at exercise prices ranging from $0.56 to $25.00. Of this total, 5,457,528 are options and warrants outstanding to employees and officers/directors. The shares of Common Stock underlying such warrants, options and all other similar rights have been duly reserved for issuance. Except as set forth above and except as set forth on Schedule 2.2, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or any of its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no written or oral options, subscriptions, warrants, convertible securities, calls, preemptive or rescission rights or other rights to acquire from the Company Common Stock were issuable upon or any of its subsidiaries, and no obligation of the exercise Company or conversion any of outstanding warrants its subsidiaries to issue, deliver or sell, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities granted or issuable (on a contingent basis or otherwise) by of the Company, and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31equity equivalents (including, 1997without limitation, except as disclosed stock appreciation rights), interests in Section 4.4 the ownership or earnings of the Company Disclosure Scheduleor other similar rights (collectively, "Company Securities"). There are no outstanding obligations of the Company has not issued or any shares of its capital stock except upon subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth on Schedule 2.2, each of the exercise of such options, warrants or convertible securities. Each outstanding share shares of capital stock of each of the Company and each Subsidiary Company's subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and is directly or indirectly owned by the Company, free and clear of all Liens. There are no existing options, calls or commitments of any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 character relating to the Company Disclosure Schedule, there are no outstanding shares of issued or unissued capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities subsidiary of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessorCompany. The Company has no outstanding No bonds, debentures, notes or other similar obligations indebtedness of the holders Company or any of which have its subsidiaries having the right to vote generally (or convertible into, or exchangeable for securities having the right to vote) on any matters on which the stockholders of the Company may vote are issued or outstanding. There are no stockholders agreements, voting agreement or similar agreements with holders respect to the Company Securities to which the Company or any of its subsidiaries are a party to, or to the knowledge of the Company, by or between any stockholders of the Company Common Stockor any of its affiliates. The Shares being purchased by the Purchaser hereunder have been duly authorized and will, upon issuance pursuant to the terms hereof, be validly issued, fully paid and nonassessable.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of Twenty-Five Million (a25,000,000) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stockwhich, $1.00 par value per share ("Company Preferred Stock"). As as of October March 31, 19971998, (i) 3,891,981 Ten Million One Hundred Twenty-Six Thousand Eight Hundred Fifty-Seven (10,126,857) shares of Company Common Stock were issued and outstanding, and (ii) 201,385 Two Hundred Fifty-Nine (259) shares of preferred stock, Ten Dollars ($10.00) par value per share, no shares of which have been issued or are outstanding. All of the shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were have been validly issued and outstanding. Since October 31are fully paid, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable non assessable and free of any preemptive rights. As of the date hereof, Two Hundred Sixteen Thousand Four Hundred Fifty (216,450) shares of Company Common Stock were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Common Stock Options all of which were issued pursuant to the Option Plans (as herein defined). Since December 31, 1997, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already issued and outstanding on such date and other than 9,057 shares of Common Stock issued pursuant to the Company's 1993 Annual Incentive Plan for Key Employees (the "1993 Annual Incentive Plan") which are outstanding on the date hereof. Since December 31, 1997, no stock options have been granted. Except as set forth above, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or its Subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options, warrants, calls, subscriptions, or other rights, arrangements, agreements or commitments to acquire from the Company or its Subsidiaries, and no obligations, arrangements, agreements or commitments of the Company or its Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, and (iv) no equity equivalents, interests in the ownership or earnings of the Company SEC Documents or its Subsidiaries or other similar rights (collectively, "Company Securities"). There are no outstanding obligations, arrangements, agreements or commitments of the Company or its Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. As of the date hereof, no employees, directors, consultants and others have exercised the right to purchase shares of Common Stock which have yet to be issued under the Option Plans. (b) All of the outstanding capital stock of each Subsidiary has been validly issued and are fully paid and non-assessable and is owned by the Company, directly or indirectly, free and clear of any Lien (as defined in Section 4.7hereinafter defined) or in Section 4.4 any other limitation or restriction (including any restriction on the right to vote or sell the same, except as may be provided as a matter of law). There are no securities of the Company Disclosure Scheduleor its Subsidiaries convertible into or exchangeable for, there no options, warrants, calls, subscriptions, or other rights to acquire from the Company or its Subsidiaries, and no other contract, agreement, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any capital stock or other interests in, or any other securities of the Company or any Subsidiary. There are no outstanding obligations, arrangements, agreements or commitments of the Company or its Subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by interests in the Company or either Subsidiary of any securities Subsidiary. To the knowledge of the Company or either SubsidiaryCompany, nor other than the Tender Agreement, there are there no outstanding any securities which are convertible into or exchangeable for any shares of capital stock of proxies with respect to the Company Common Stock and there are no agreements, arrangements or either Subsidiary; and neither understandings by or among any persons which affect or relate to the voting of, or giving of written consents with respect to, the Company nor either Subsidiary has Common Stock. For purposes of this Agreement, "Lien" means, with respect to any obligation asset (including, without limitation, any security) any mortgage, lien, claim, pledge, charge, security interest or encumbrance of any kind to issue any additional securities or to pay for securities in respect of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stocksuch asset.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares The authorized stock of common stock, $0.05 par value per share ("the Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, consists of: (i) 3,891,981 240,000,000 shares of Company Common Stock were Stock, of which 56,465,838 shares are issued and outstandingoutstanding as of the date hereof and 2,105,372 shares are held by the Company in treasury, and (ii) 201,385 2,000,000 shares of Company Common Stock were issuable upon the exercise Preferred Stock, par value $.01 per share, of outstanding optionswhich 100,000 shares are designated as Series A Junior Participating Preferred Stock, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were which are outstanding. All of the issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and Shares have been validly issued, and are duly authorized, fully paid and nonassessable paid, non-assessable and free of any preemptive rights. As of the date hereof, other than 7,092,273 Shares are reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Option Plans and 4,326,757 Shares are reserved for issuance upon conversion of the Company's 4 1/4% Convertible Subordinated Notes due 2007 (the "4 1/4% Notes"). Except as set forth aboveabove and except for the Option Agreement, in the 4 1/4% Notes and the Company SEC Documents Rights Agreement (as defined in Section 4.7) or in Section 4.4 to hereinafter defined), as of the Company Disclosure Scheduledate hereof, there are no outstanding (i) shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights voting securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any Company; (ii) securities of the Company or either Subsidiary, nor are there outstanding any securities which are of its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company; (iii) options or other rights to acquire from the Company or any of its subsidiaries, and no obligations of the Company or any of its subsidiaries to issue, any stock, voting securities, or securities convertible into or exchangeable for stock or voting securities of the Company; or (iv) equity equivalents, interests in the ownership or earnings of the Company, or other similar rights (including stock appreciation rights) (collectively, "Company Securities"). Except for the Option Agreement and the 4 1/4% Notes, there are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. There are no stockholder agreements, voting trusts or other agreements or understandings to which the Company or any of its subsidiaries is a party or to which it is bound relating to the voting of any shares of capital stock of the Company (other than the Voting Agreement). (b) All of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or either Subsidiary; indirectly, free and neither the Company nor either Subsidiary has any obligation clear of any kind Lien or any other limitation or restriction (including, any restriction on the right to issue any additional securities vote or to pay for sell the same) except as may be provided as a matter of Law. There are no securities of the Company or either Subsidiary its subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries, and no other contract, understanding, arrangement, or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly of, any capital stock or other ownership interests in, or any predecessorother securities of, any subsidiary of the Company. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debenturesredeem, notes or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. None of which have the right to vote generally with holders Company's subsidiaries owns any capital stock of Company Common Stockthe Company. For purposes of this Agreement, "Lien" means, in respect of any asset (including any security) any mortgage, lien, pledge, charge, security interest, or encumbrance of any kind in respect of such asset.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares The authorized share capital of common stock, $0.05 the Company consists of 1,000,000,000 Shares of par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock")US$0.001. As of October 31May 12, 19972011 (the “Capitalization Date”), (i) 3,891,981 shares of Company Common Stock 60,263,183 Shares were issued and outstanding, ; (ii) 201,385 shares 3,000,585 Shares were reserved for issuance upon exercise of the Company Common Stock Warrants; (iii) 1,082,909 Shares were reserved for issuance upon exercise of the Company Options and (iv) 778,800 Shares were reserved for issuance upon exercise of the Company Unit Options (including Company Warrants issuable upon the exercise of such Company Unit Options). From the Capitalization Date through the date of this Agreement, no options, warrants or other rights to purchase Shares have been issued or granted and no Shares have been issued. All the outstanding Shares are, and the Shares issuable upon the exercise of outstanding optionsCompany Options and Company Warrants will be, an additional 230,749 shares of Company Common Stock were issuable upon when issued in accordance with the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companyterms thereof, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31duly authorized, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rightsnon-assessable. As of the date hereof, other than Except as set forth aboveabove and except for the transactions contemplated by this Agreement (1) there is no share capital of the Company authorized, issued or outstanding, (2) there are no authorized or outstanding options, warrants, calls, preemptive rights, subscriptions or other rights, agreements, arrangements or commitments of any character (whether or not conditional) relating to the issued or unissued share capital of the Company or any of its Subsidiaries, obligating the Company or any of its Subsidiaries to issue, transfer or sell or cause to be issued, transferred or sold any share capital or other equity interest in the Company SEC Documents (as defined in Section 4.7) of any of its Subsidiaries or in Section 4.4 to securities convertible into or exchangeable or exercisable for such share capital or equity interests, or obligating the Company Disclosure Scheduleor any of its Subsidiaries to grant, extend or enter into any such option, warrant, call, preemptive right, subscription or other right, agreement, arrangement or commitment, and (3) there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryany of its Subsidiaries to repurchase, nor are there outstanding redeem or otherwise acquire any securities which are convertible into Shares or exchangeable for any shares of other share capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities its Subsidiaries, or to pay for securities make any payments based on the market price or value of shares or other share capital of the Company or either its Subsidiaries, or to provide funds to make any investment (in the form of a loan, capital contribution or otherwise) in any Subsidiary or any predecessorother entity other than loans to Subsidiaries in the ordinary course of business. The Company has no does not have outstanding any bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally (or convertible into or exchangeable or exercisable for securities having the right to vote) with holders the shareholders of the Company Common Stockon any matter. (b) All of the outstanding share capital of the Company’s wholly owned Subsidiaries (“Wholly Owned Subsidiaries”) has been duly authorized, and validly issued, and is fully paid and nonassessable and owned by the Company, directly or indirectly, free and clear of any Lien (as hereinafter defined) or any other limitation or restriction (including any restriction on the right to vote or sell the same, except as may be provided as a matter of Law), and there are no irrevocable proxies with respect to such share capital. The outstanding share capital of the Company’s Subsidiaries that are not Wholly Owned Subsidiaries (other than VIE and its Subsidiaries) has been duly authorized, and validly issued, and is fully paid and nonassessable and owned by the Company, directly or indirectly, free and clear of any Lien (other than Permitted Liens) or any other limitation (except as may exist as a matter of Law). For purposes of this Agreement, “Lien” means, with respect to any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset. All of the outstanding share capital of VIE and each of its Subsidiaries has been duly authorized, and validly issued, and is fully paid and nonassessable and owned by Xx. Xxxxxxxx Xxx and Xx. Xxxxxxx Xxxx, directly or indirectly, free and clear of any Lien, except for the equity pledge described in the Equity Pledge Agreements.

Capitalization of the Company and its Subsidiaries. 3.2.1 The Company's authorized share capital stock consists solely of (a) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares consists of Company Common Stock were issuable upon 110,714,286 Shares, of which, as of August 1, 2022 (the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company“Measurement Date”), and (iii) no shares of Company Preferred Stock 16,848,041 Shares were issued and outstanding. Since October 31, 1997None of the Shares are held by a Subsidiary of the Company. Between the Measurement Date and the date hereof, except as disclosed in Section 4.4 ‎3.2.1 of the Company Disclosure Schedule, the Company has not no Shares have been issued any shares of its capital stock except (other than Shares issuable upon the exercise of such options, warrants or convertible securitiesexisting Company Stock Options) and no Company Stock Options have been granted. Each outstanding share of capital stock All of the outstanding Shares have been (and all Shares which may be issued pursuant to the Company and each Subsidiary is duly authorized and Plans when issued in accordance with the terms thereof will be) validly issued, fully paid and paid, nonassessable and free of any preemptive rights. As of the date hereofMeasurement Date, other than 10,088,013 Shares were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options. Each Company Stock Option was granted in compliance with all Applicable Laws and all of the terms and conditions of the Company Plans. Except as set forth above, in the Company SEC Documents (above and as defined disclosed in Section 4.7) or in Section 4.4 to ‎3.2.1 of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions(i) shares, options, warrants, puts, calls, agreements, understandings, claims equity interests or other commitments voting securities or rights Capital Stock of any type relating to the issuanceCompany, sale or transfer by the Company or either Subsidiary of any (ii) securities of the Company or either Subsidiary, nor are there outstanding any securities which are of its Subsidiaries convertible into or exchangeable or exercisable for shares or other securities of the Company, (iii) options, preemptive or other rights to acquire from the Company or any shares of capital stock its Subsidiaries, or obligations of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of its Subsidiaries to issue, any kind to issue any additional shares, voting securities or to pay securities convertible into or exchangeable or exercisable for shares or other securities of the Company or either Subsidiary any of its Subsidiaries or any predecessor. The (iv) equity equivalent interests in the ownership or earnings of the Company has no outstanding bonds, debentures, notes or its Subsidiaries or other similar rights (collectively “Company Securities”). There are no outstanding rights or obligations of the holders Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth in Section ‎3.2.1(iii) of the Company Disclosure Schedule, there are no voting agreements, voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party or by which the Company or any Subsidiary of the Company is bound relating to the voting or registration of any shares of Capital Stock of the Company or any of its Subsidiaries. 3.2.2 All of the outstanding Capital Stock of the Company’s Subsidiaries owned by the Company have been duly authorized, validly issued and are fully paid and non-assessable and are owned by the Company, directly or indirectly, free and clear of any Lien or any other limitation or restriction on the right to vote generally or sell the same, other than restrictions on transfer under applicable securities laws. Except as disclosed in Section ‎3.2.2 of the Company Disclosure Schedule, there are no outstanding securities of the Company or any of its Subsidiaries convertible into or exchangeable or exercisable for, options or other rights to acquire from the Company or any of its Subsidiaries, any Capital Stock or other ownership interests in or any other securities of any Subsidiary of the Company, and there exists no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any such Capital Stock. There are no outstanding contractual obligations of the Company or its Subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of Capital Stock or other ownership interests in any Subsidiary of the Company. 3.2.3 Section 3.2.3 of the Company Disclosure Schedule sets forth a complete and correct list (the “Awards Schedule”) of all Awards outstanding as of the date hereof, which list includes, with holders respect to each outstanding Award: (i) the name of the holder of such Award; (ii) the service relationship of such Award holder at the time of grant (i.e., director, employee, independent contractor, or consultant of the Company Common Stockor any of its Subsidiaries); (iii) the status of such Award holder (i.e., active or terminated); (iv) the number of Shares underlying such Award; (v) the grant date of such Award, (vi) the classification of such Award as Section 3(i) Options, Section 102 Options, Section 102 Non Trustee Options, Section 102 Shares, Section 102 Non Trustee Shares, etc.;

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), 190,000,000 Shares and (b) 10,000,000 shares of preferred stock, $1.00 par value US$0.001 per share ("“Company Preferred Stock"”). As of October 31December 9, 19972013 (the “Capitalization Date”), (i) 3,891,981 shares of Company Common Stock 36,807,075 Shares were issued and outstanding, ; (ii) 201,385 shares no Shares were issued and held in the treasury of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but Company; (iii) 2,950,519 Shares are reserved for issuance upon the designation of optionees by the Board of Directors exercise of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, Warrants and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 3.2(a) of the Company Disclosure ScheduleSchedule sets forth a complete and correct list of all holders of Company Warrants, including such Person’s name, the number of Company has not issued any shares Warrants held by such Person as of its capital stock except the Capitalization Date and the exercise price for each such Company Warrants. All the outstanding Shares are, and the Shares issuable upon the exercise of such optionsoutstanding Company Warrants will be, warrants or convertible securities. Each outstanding share of capital stock of when issued in accordance with the Company and each Subsidiary is terms thereof, duly authorized and authorized, validly issued, fully paid and nonassessable non-assessable, in compliance with all applicable Laws, and free none of such outstanding Shares was or will be issued in violation of any preemptive rightsrights or similar rights to subscribe for or purchase securities. As of the date hereof, other than Except as set forth aboveabove and except as contemplated by this Agreement, in (i) there is no share capital of the Company SEC Documents authorized, issued or outstanding, (as defined in Section 4.7ii) or in Section 4.4 to the Company Disclosure Schedule, there are no authorized or outstanding shares of capital stock or subscriptions, options, warrants, putscalls, callspreemptive rights, subscriptions or other rights, agreements, understandings, claims arrangements or other commitments or rights of any type character (whether or not conditional) relating to the issuance, sale issued or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of unissued capital stock of the Company or either Subsidiary; and neither any of its Subsidiaries, obligating the Company nor either Subsidiary has or any obligation of its Subsidiaries to issue, transfer or sell or cause to be issued, transferred or sold any kind share capital or other equity interest in the Company or any of its Subsidiaries or securities convertible into or exchangeable for such share capital or equity interests, or obligating the Company or any of its Subsidiaries to issue grant, extend or enter into any additional securities such option, warrant, call, subscription or to pay for securities other right, agreement, arrangement or commitment, (iii) there are no outstanding contractual obligations of the Company or either Subsidiary any of its Subsidiaries to repurchase, redeem or otherwise acquire any Shares or other share capital of the Company or any predecessor. The of its Subsidiaries, or to make any payments based on the market price or value of Shares or other capital stock of the Company has or its Subsidiaries, or to provide funds to make any investment (in the form of a loan, capital contribution or otherwise) in the Company’s Subsidiaries or any other entity other than loans to the Company’s Subsidiaries in the ordinary course of business, and (iv) there are no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally (or convertible into or exercisable for securities having the right to vote) with the stockholders of the Company on any matter. (b) All of the outstanding share capital of the Company’s wholly owned Subsidiaries (“Wholly Owned Subsidiaries”) has been duly authorized, validly issued, and is fully paid except as permitted under applicable Law and non-assessable and owned by the Company, directly or indirectly, free and clear of any Liens (except as may be provided as a matter of Law), and there are no irrevocable proxies with respect to such share capital. The outstanding share capital of the Company’s Subsidiaries that are not Wholly Owned Subsidiaries has been duly authorized, validly issued, and is fully paid except as permitted under applicable Law and non-assessable and owned by the Company, directly or indirectly, free and clear of any Liens (except as may be provided as a matter of Law). (c) Each Company Warrant was granted in compliance with all applicable Laws in all material respects and all of the terms and conditions of the Company Warrants. From and after the Effective Time, pursuant to the terms of the Company Warrants, (i) each Company Warrant shall represent the right to receive, upon exercise in accordance with its terms, including payment of the applicable cash exercise price, only the Merger Consideration with respect to each Share subject to such Company Warrant with respect to which such Company Warrant is duly exercised, and (ii) in no circumstances shall holders of Company Common StockWarrants be entitled to receive Shares or other securities of any of the Company, the Surviving Corporation or Parent upon any exercise of Company Warrants.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 100,000,000 shares of preferred stock, $0.01 par value per share, 1,000,000 shares of which are designated Series A Junior Participating Preferred (“Series A Preferred Stock”), none of which are issued and outstanding, and 99,000,000 shares of which are blank check preferred stock without designation, none of which are issued and outstanding; and (ii) 100,000,000 shares of common stock, $0.05 0.01 par value per share ("Company share, 33,333,333 shares of which are designated as Class A Common Stock"), 11,418,499 of which are issued and outstanding as of April 8,2002, and (b) 10,000,000 66,666,667 shares of preferred stockwhich are designated as Class B Common Stock, $1.00 par value per share ("Company Preferred Stock")21,075,263 of which are issued and outstanding as of April 8, 2002. As All of October 31, 1997, (i) 3,891,981 theoutstanding shares of Company Common Stock were have been validly issued and outstandingare fully paid, nonassessable and free of preemptive rights. As of April 8, 2002, 56,680 shares of Class A Common Stock and 184,643 shares of Class B Common Stockwere reserved for issuance pursuant to outstanding Company Stock Options. Exceptas set forth above or as set forth in Section 3.2 of the Company DisclosureSchedule, as of the date hereof, there were outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) 201,385 no securities of the Company convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company and, no obligations of the Company to issue any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company and (iv) no equity equivalent interests in theownership or earnings of the Company or its subsidiaries (collectively “Company Securities”). Section 3.2 of the Company Disclosure Schedule identifies, as ofApril 8, 2002, the holder of each outstanding Company Stock Option issued pursuant to the Stock Option Plan, the number of shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of each Company Common Stock were issuable upon Option and the exercise price and expiration date thereof and except as set forth in Section 3.2 of theCompany Disclosure Schedule no options that are not currently outstanding but are reserved for issuance upon have been grantedother than pursuant to the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rightsOption Plan. As of the date hereof, other than except asset forth in Section 3.2 of the Company Disclosure Schedule, there are nooutstanding obligations of the Company or its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth abovein Section 3.2of the Company Disclosure Schedule, there are no stockholder agreements, votingtrusts or other agreements or understandings to which the Company is a party orby which it is bound relating to the voting or registration of any shares ofcapital stock of the Company. Since April 8, 2002, there have been no issuancesof the Company’s capital stock other than issuances pursuant to outstandingCompany Stock Options. (b) Except as set forth in Section 3.2 of the Company Disclosure Schedule, all of the outstanding capital stock of the Company’s Significant Subsidiaries (other than director’s qualifying shares in the Company SEC Documents case of foreign subsidiaries) is owned by the Company, or one of its subsidiaries, directly or indirectly, free and clear of any Lien or any other limitation or restriction (including any restriction on the right to vote or sell the same except as defined may be provided as a matter of law) and except for any Liens which are incurred in the ordinary course of business. Except as set forth in Section 4.73.2 of the Company DisclosureSchedule, all of the outstanding capital stock of the Company’s other subsidiaries (other than director’s qualifying shares in the case of foreign subsidiaries) is owned by the Company, or one of its subsidiaries, free and clear of any material Lien or any other material limitation or restriction (including any restriction on the right to vote or sell the same except as may be provided as a matter of law) and except for any Liens which are incurred in the ordinary course of business. All of the outstanding shares of capital stock of the Company’s Significant Subsidiaries are duly authorized, validly issued and outstanding, fully paid and nonassessable, and were issued free of preemptive rights in compliance with applicable corporate and securities laws. Except as set forth in Section 4.4 3.2 of the Company Disclosure Schedule, there are no securities of the Company’s subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company or its subsidiaries and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for, the issuance, purchase or sale, directly or indirectly, by the Company or any of its subsidiaries of any capital stock or other ownership interests in or any other securities of any subsidiary of the Company. Except as set forth in Section 3.2 of the Company Disclosure Schedule, there are no outstanding contractual obligations of the Company’s subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of capital stock or subscriptionsother ownership interests in any subsidiary of the Company. For purposes of this Agreement, options“Lien” means, warrantswith respect to any asset (including without limitation any security), putsany mortgage, callslien, agreementspledge, understandingscharge, claims security interest or other commitments or rights encumbrance of any type relating to kind in respect of such asset. (c) The Class A Common Stock and Class B Common Stock constitute the issuance, sale or transfer by the Company or either Subsidiary only classes of any equity securities of the Company or either Subsidiaryits subsidiaries registeredor required to be registered under the Securities Exchange Act of 1934, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of as amended (the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock“Exchange Act”).

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 100,000,000 shares of preferred stock, $0.01 par value per share, 1,000,000 shares of which are designated Series A Junior Participating Preferred ("Series A Preferred Stock"), none of which are issued and outstanding, and 99,000,000 shares of which are blank check preferred stock without designation, none of which are issued and outstanding; and (ii) 100,000,000 shares of common stock, $0.05 0.01 par value per share ("Company share, 33,333,333 shares of which are designated as Class A Common Stock"), 11,418,499 of which are issued and outstanding as of April 8, 2002, and (b) 10,000,000 66,666,667 shares of preferred stockwhich are designated as Class B Common Stock, $1.00 par value per share ("Company Preferred Stock")21,075,263 of which are issued and outstanding as of April 8, 2002. As All of October 31, 1997, (i) 3,891,981 the outstanding shares of Company Common Stock were have been validly issued and outstandingare fully paid, (ii) 201,385 nonassessable and free of preemptive rights. As of April 8, 2002, 56,680 shares of Company Class A Common Stock and 184,643 shares of Class B Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the pursuant to outstanding Company and 154,175 shares of Company Common Stock were issuable upon the exercise Options. Except as set forth above or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed set forth in Section 4.4 3.2 of the Company Disclosure Schedule, as of the date hereof, there were outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company has not issued any convertible into or exchangeable for shares of its capital stock except or voting securities of the Company, (iii) no options or other rights to acquire from the Company and, no obligations of the Company to issue any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company and (iv) no equity equivalent interests in the ownership or earnings of the Company or its subsidiaries (collectively "Company Securities"). Section 3.2 of the Company Disclosure Schedule identifies, as of April 8, 2002, the holder of each outstanding Company Stock Option issued pursuant to the Stock Option Plan, the number of shares of Company Common Stock issuable upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock each Company Stock Option and the exercise price and expiration date thereof and except as set forth in Section 3.2 of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rightsDisclosure Schedule no options currently outstanding have been granted other than pursuant to the Stock Option Plan. As of the date hereof, other than except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to 3.2 of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryits subsidiaries to repurchase, nor redeem or otherwise acquire any Company Securities. Except as set forth in Section 3.2 of the Company Disclosure Schedule, there are there outstanding any securities no stockholder agreements, voting trusts or other agreements or understandings to which are convertible into the Company is a party or exchangeable for by which it is bound relating to the voting or registration of any shares of capital stock of the Company. Since April 8, 2002, there have been no issuances of the Company's capital stock other than issuances pursuant to outstanding Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities Stock Options. (b) Except as set forth in Section 3.2 of the Company Disclosure Schedule, all of the outstanding capital stock of the Company's Significant Subsidiaries (other than director's qualifying shares in the case of foreign subsidiaries) is owned by the Company, or either Subsidiary one of its subsidiaries, directly or indirectly, free and clear of any Lien or any predecessor. The Company has no outstanding bonds, debentures, notes other limitation or other similar obligations the holders of which have restriction (including any restriction on the right to vote generally with holders or sell the same except as may be provided as a matter of law) and except for any Liens which are incurred in the ordinary course of business. Except as set forth in Section 3.2 of the Company Common Stock.Disclosure Schedule, all of the outstanding capital stock of the Company's other subsidiaries (other than director's qualifying shares in the case of foreign subsidiaries) is owned by the Company, or one of its subsidiaries, free and clear of any material Lien or any other material limitation or restriction (including any restriction on the right to vote or sell the same except as may be provided as a matter of law) and except for

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of Forty Million (a40,000,000) 20,000,000 shares Shares, of common stockwhich, $0.05 par value per share as of November 30, 1998, 18,095,580 Shares were issued and outstanding and Two Million ("Company Common Stock"), and (b2,000,000) 10,000,000 shares of preferred stock, $1.00 0.001 par value per share ("Company Preferred Stock")share, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of October 31November 30, 19971998, approximately 4,396,556 Shares were reserved for issuance and, as of December 5, 1998, 3,597,768 were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. Between December 5, 1998 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options already in existence on such date, and between December 5, 1998 and the date hereof no stock options have been granted. Except as set forth above and for the rights (the "Company Rights") issued pursuant to the Company's Preferred Shares Rights Agreement, dated as of January 10, 1996, as amended between the Company and BankBoston, N.A. (the "Company Rights Agreement"), as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 no securities of the Company or any of its subsidiaries convertible into or exchangeable or exercisable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company Common Stock were issuable upon or any of its subsidiaries, and, except as described in the exercise Company SEC Reports (as defined below), no obligations of outstanding optionsthe Company or any of its subsidiaries to issue any capital stock, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved voting securities or securities convertible into or exchangeable or exercisable for issuance upon the designation of optionees by the Board of Directors capital stock or voting securities of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed equity equivalent interests in Section 4.4 the ownership or earnings of the Company Disclosure Schedule, the or its subsidiaries or other similar rights (collectively "Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rightsSecurities"). As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock rights or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities obligations of the Company or either Subsidiaryany of its subsidiaries to repurchase, nor redeem or otherwise acquire any Company Securities. There are there outstanding any securities no stockholder agreements, voting trusts or other agreements or understandings to which are convertible into the Company is a party or exchangeable for by which it is bound relating to the voting or registration of any shares of capital stock of the Company Company. (b) All of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or either Subsidiary; indirectly, free and neither the Company nor either Subsidiary has any obligation clear of any kind Lien or any other limitation or restriction (including any restriction on the right to issue any additional securities vote or to pay for sell the same except as may be provided as a matter of law). There are no (i) securities of the Company or either Subsidiary any of its subsidiaries convertible into or exchangeable or exercisable for, (ii) options or (iii) except for the Company Rights, other rights to acquire from the Company or any predecessorof its subsidiaries any capital stock or other ownership interests in or any other securities of any subsidiary of the Company, and there exists no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any such capital stock. The Company has There are no outstanding bondscontractual obligations of the Company or its subsidiaries to repurchase, debentures, notes redeem or otherwise acquire any outstanding shares of capital stock or other similar obligations ownership interests in any subsidiary of the holders Company. For purposes of this Agreement, "Lien" means, with respect to any asset (including any security), any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset; PROVIDED, HOWEVER, that the term "Lien" shall not include (i) statutory liens for Taxes, which have are not yet due and payable or are being contested in good faith by appropriate proceedings and disclosed in Section 2.13(d) of the right Company Disclosure Schedule or that are otherwise not material, (ii) statutory or common law liens to vote generally with holders secure landlords, lessors or renters under leases or rental agreements confined to the premises rented, (iii) deposits or pledges made in connection with, or to secure payment of, workers' compensation, unemployment insurance, old age pension or other social security programs mandated under applicable laws, (iv) statutory or common law liens in favor of Company Common Stockcarriers, warehousemen, mechanics and materialmen, to secure claims for labor, materials or supplies and other like liens, and (v) restrictions on transfer of securities imposed by applicable state and federal securities laws.

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock consists solely of (a) 20,000,000 shares As of common stockthe date hereof, $0.05 par value per share ("the authorized stock of the Company Common Stock")consists of 15,000,000 Shares, of which, as of May 31, 1999, 8,005,802 Shares were issued and outstanding, and (b) 10,000,000 1,000,000 shares of preferred stock, $1.00 par value $0.001 per share ("Company Preferred Stock")share, no shares of which are outstanding. All of the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of October May 31, 19971999, (i) 3,891,981 shares of Company Common Stock approximately 1,182,210 Shares were issued reserved for issuance and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon or otherwise deliverable in connection with the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of Options issued pursuant to the Company Option Plans referred to in Section 2.10. Between May 31, 1999 and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Companydate hereof, and (iii) no shares of the Company's stock have been issued other than pursuant to Company Preferred Stock were issued Options, and outstanding. Since October between May 31, 1997, except 1999 and the date hereof no stock options have been granted. Except as disclosed set forth above and in Section 4.4 3.2(a) of the Company Disclosure Schedule, as of the Company has not issued any date hereof, there are issued, reserved for issuance, or outstanding (i) no shares of its capital stock except upon or other voting securities of the exercise of such optionsCompany, warrants or convertible securities. Each outstanding share of capital stock (ii) no securities of the Company or its subsidiaries convertible into or exchangeable for shares of stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company or its subsidiaries and, except as described in the Company SEC Reports (defined herein), no obligations of the Company or its subsidiaries to issue any stock, voting securities or securities convertible into or exchangeable for stock or voting securities of the Company, (iv) no bonds, debentures, notes or other indebtedness or obligations of the Company or any of its subsidiaries entitling the holders thereof to have the right to vote (or which are convertible into, or exercisable or exchangeable for, securities entitling the holders thereof to have the right to vote) with the stockholders of the Company or any of its subsidiaries on any matter, (v) no equity equivalent interests in the ownership or earnings of the Company or its subsidiaries or other similar rights, and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free of any preemptive rights(vi) the Rights (collectively "Company Securities"). As of the date hereof, other than as set forth above, in there are no outstanding obligations of the Company SEC Documents or its subsidiaries (as defined in Section 4.7absolute, contingent or otherwise) to repurchase, redeem or in Section 4.4 otherwise acquire any Company Securities. There are no Shares outstanding subject to rights of first refusal of the Company Disclosure ScheduleCompany, nor are there any pre-emptive rights with respect to any Shares. Other than this Agreement, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock.understandings

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of: (i) 50,000,000 Shares, of (a) 20,000,000 shares which 7,713,082 Shares were issued and outstanding as of common stockthe close of business on April 28, $0.05 par value per share ("Company Common Stock")1999 and none of which are held in the Company's treasury, and (bii) 10,000,000 7,000,000 shares of preferred stock, $1.00 par value $.001 per share (the "Company Preferred StockPREFERRED STOCK"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were which are outstanding. All of the issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company and each Subsidiary is duly authorized and Shares have been validly issued, and are duly authorized, fully paid and nonassessable paid, non-assessable, and free of any preemptive rights. As of April 28, 1999, 728,248 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Option Plans, 308,566 Shares were reserved for issuance and issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Warrants, and 220,754 Shares were reserved for issuance pursuant to the Company Stock Purchase Plan. Since April 28, 1999, no shares of the Company's capital stock have been issued other than pursuant to Company Stock Options or Company Warrants already in existence on such date or pursuant to the Company Stock Purchase Plan, and, since the date hereof, other than no Company Stock Options or Company Warrants have been granted. Except as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Scheduleof April 28, 1999, there are outstanding (i) no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights voting securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any Company; (ii) no securities of the Company or either Subsidiary, nor are there outstanding any securities which are of its subsidiaries convertible into or exchangeable for any shares of capital stock or voting securities of the Company; (iii) no options or other rights to acquire from the Company or any of its subsidiaries, and no obligations of the Company or either Subsidiaryany of its subsidiaries to issue, any capital stock, voting securities, or securities convertible into or exchangeable for capital stock or voting securities of the Company; and neither (iv) no equity equivalents, interests in the Company nor either Subsidiary has any obligation of any kind to issue any additional securities ownership or to pay for securities earnings of the Company or either Subsidiary or any predecessor. The Company has no outstanding bondsof its subsidiaries, debentures, notes or other similar rights (including, stock appreciation rights) (collectively, "COMPANY SECURITIES"). There are no outstanding obligations the holders of which have the right to vote generally with holders of Company Common Stock.the

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of: (i) 100,000,000 Shares, of which 27,937,737 Shares were issued and outstanding and no Shares of which were held in the Company's treasury, in each case, as of the close of business on the date of this Agreement, (aii) 20,000,000 100,000 shares of common stockClass A Convertible Preferred Stock, $0.05 par value of $.01 per share ("Company Common Stock")share, no shares of which are outstanding, and (biii) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Serial Preferred Stock"), with no par value, of which none are issued and outstanding. All of the issued and outstanding Shares have been validly issued, and are duly authorized, fully paid, non-assessable and free of preemptive rights. As of October 31April 30, 19972002, there were 3,104,247 Shares reserved for issuance and issuable pursuant to the Company Option Plan or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Option Plan. In addition, as of the date of this Agreement, there were 2,557,175 Shares reserved for issuance and issuable pursuant to various warrant agreements with third parties or otherwise deliverable in connection with the exercise of outstanding Common Stock warrants. Section 3.2(a) of the Company Disclosure Schedule includes a list of all holders of Company Options and a summary of the terms of each option including the exercise price, vesting period, grant date and expiration date, as of the date of this Agreement. Section 3.2(a) of the Company Disclosure Schedule also lists all persons, to the Company's knowledge, that hold, directly or indirectly (applying the beneficial ownership rules of Rule 13d-3 of the Exchange Act), at least five percent (5%) of the number of shares of the Company's outstanding capital stock or at least five percent (5%) of the Company's voting power outstanding, as of the date of this Agreement, determined on an as-converted and fully-diluted basis, and any terms, conditions, rights, privileges or obligations relating to such ownership that differ from those set forth in the Company's articles of incorporation and bylaws. Except as set forth above or on the Company Disclosure Schedule and except for the warrants to be issued to Parent in connection with the Loan Agreement, as of the date hereof, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 or its subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no options or other rights to acquire from the Company Common Stock were issuable upon or its subsidiaries, and no obligations of the exercise Company or conversion its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31equity equivalents, 1997, except as disclosed interests in Section 4.4 the ownership or earnings of the Company Disclosure Scheduleor its subsidiaries or other similar rights (including stock appreciation rights) (collectively, the Company has not issued any shares of its capital stock except upon the exercise of such options, warrants or convertible securities"COMPANY SECURITIES"). Each There are no outstanding share of capital stock obligations of the Company and each Subsidiary is duly authorized and validly issuedor its subsidiaries to repurchase, fully paid and nonassessable and free redeem or otherwise acquire any Company Securities. Except for the Irrevocable Proxy to be executed pursuant to Section 6.14 of any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedulethis Agreement, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or to which it is bound relating to the issuance, sale or transfer by the Company or either Subsidiary voting of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither Company, and, to the Company nor either Subsidiary has Company's knowledge, no such agreements exist between any obligation of any kind to issue any additional securities or to pay for securities the Company's security holders. (b) Except as set forth on Section 3.2(b) of the Company Disclosure Schedule, all of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or either Subsidiary indirectly, free and clear of any Lien (as hereinafter defined) or any predecessor. The Company has no outstanding bonds, debentures, notes other limitation or other similar obligations the holders of which have restriction (including any restriction on the right to vote generally with holders of Company Common Stock.or sell the same, except

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares of common stock, $0.05 par value per share ("Company Common Stock"), and (b) 10,000,000 shares of preferred stock, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, (i) 3,891,981 25,000,000 shares of Company Common Stock of which, as of November 30, 1996, 15,751,749 shares of Common Stock were issued and outstanding, outstanding and (ii) 201,385 5,000,000 shares of Company Common Stock were issuable upon the exercise Preferred Stock, par value of outstanding options$.01 per share, an additional 230,749 shares of Company Common Stock were issuable upon the exercise which, as of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the CompanyNovember 30, and (iii) 1996, no shares of Company Preferred Stock were issued and outstanding. Since October 31All outstanding shares of Common Stock have been authorized, 1997validly issued, and are fully paid, nonassessable and free of all preemptive and rescission rights. As of November 30, 1996, Company Options to purchase an aggregate of 1,021,399 shares of Common Stock were outstanding and the weighted average exercise price of such Company Options was $2.292 per share of Common Stock. Except as set forth in this Agreement or in Schedule 4.2, and except as disclosed in Section 4.4 a result of the exercise of Company Options outstanding as of November 30, 1996, there are no outstanding Company Securities. There are no outstanding obligations of the Company Disclosure Scheduleor any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities, other than the Company's obligation to repurchase Company Options under, and in accordance with the express terms of the employment agreements set forth on Schedule 4.2 (accurate and complete copies of which have previously been delivered to Parent) and for obligations of the Company has not issued any shares to employees terminated as a result of its capital stock except upon the exercise of such options, warrants or convertible securitiestransactions contemplated under this Agreement as set forth on Schedule 4.2. Each of the outstanding share shares of capital stock of each of the Company and each Subsidiary Company's subsidiaries (excluding inactive subsidiaries) is duly authorized and authorized, validly issued, fully paid and nonassessable and is directly or indirectly owned by the Company, free and clear of any preemptive rights. As of the date hereofall Liens, other than except as set forth aboveon Schedule 4.2. There are no existing options, in the Company SEC Documents (as defined in Section 4.7) calls or in Section 4.4 commitments of any character relating to the Company Disclosure Schedule, there are no outstanding shares of issued or unissued capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights securities of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any securities subsidiary of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessorCompany. The Company has no outstanding No bonds, debentures, notes or other similar obligations indebtedness of the holders Company or any of which have its Insurance Subsidiaries having the right to vote generally with holders (or convertible into, or exchangeable for securities having the right to vote) on any matters on which the stockholders of the Company Common Stockmay vote, are issued or outstanding.

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 shares Shares, of common stockwhich, $0.05 par value per share ("Company Common Stock")as of the close of business on July 21, and (b) 10,000,000 shares of preferred stock1999, $1.00 par value per share ("Company Preferred Stock"). As of October 31, 1997, (i) 3,891,981 shares of Company Common Stock 10,119,265 Shares were issued and outstanding, (ii) 201,385 shares including 1,123,750 treasury Shares. All of Company Common Stock the outstanding Shares have been validly issued and are fully paid, nonassessable and free of preemptive rights. As of the close of business on July 21, 1999, approximately 2,005,225 Shares were reserved for issuance and, as of the close of business on July 21, 1999, 1,499,557 were issuable upon or otherwise deliverable in connection with the exercise of outstanding optionsCompany Stock Options. For purposes hereof, an additional 230,749 "COMPANY STOCK OPTION" means any option, warrant or other right to purchase Shares. Between the close of business on July 21, 1999 and the date hereof, no shares of the Company's capital stock have been issued other than pursuant to Company Common Stock were issuable upon Options already in existence on such date and, between the exercise close of business on January 2, 1999 and the date hereof, no stock options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors have been granted, except as set forth in Section 3.2(a) of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise Disclosure Schedule. Except as set forth above or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Preferred Stock were issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 3.2(a) of the Company Disclosure Schedule, as of the Company has not issued any date hereof, there are outstanding: (i) no shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock or other voting securities of the Company; (ii) no securities of the Company or any of its subsidiaries convertible into or exchangeable or exercisable for shares of capital stock or other securities of the Company; (iii) no options, preemptive or other rights to acquire from the Company or any of its subsidiaries, and, except as described in the Company SEC Reports (as defined below), no obligations of the Company or any of its subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable or exercisable for capital stock or other securities of the Company; and each Subsidiary is duly authorized and validly issued, fully paid and nonassessable and free (iv) no equity equivalent interests in the ownership or earnings of any preemptive rightsthe Company or its subsidiaries or other similar rights (collectively "COMPANY SECURITIES"). As of the date hereof, other than there are no outstanding rights or obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth above, in the Company SEC Documents (as defined in Section 4.73.2(a) or in Section 4.4 to of the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, stockholder agreements, understandings, claims voting trusts or other commitments agreements or rights of any type understandings to which the Company is a party or by which it is bound relating to the issuance, sale voting or transfer by the Company or either Subsidiary registration of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company. Pursuant to their terms, all outstanding Company Stock Options and SARs will automatically vest as a result of the Offer or either Subsidiary; and neither the Company nor either Subsidiary has Merger or any obligation other change in control of any kind to issue any additional securities or to pay for securities the Company. (b) Except as set forth in Section 3.2(b) of the Company Disclosure Schedule, all of the outstanding capital stock of the Company's subsidiaries is owned by the Company, directly or either Subsidiary indirectly, free and clear of any Lien or any predecessor. The Company has no outstanding bonds, debentures, notes other limitation or other similar obligations the holders of which have restriction (including any restriction on the right to vote generally with holders or sell the same except as a matter of Applicable Law). Except as set forth in Section 3.2(b) of the Company Common Stock.Disclosure Schedule, any directors

Capitalization of the Company and its Subsidiaries. The Company's authorized capital stock of the Company consists solely of (ai) 20,000,000 30,000,000 shares of common stockCommon Stock, $0.05 par value $.01 per share ("Company share, of which, as of the date of this Agreement, 8,262,513 shares of Common Stock"), Stock are issued and outstanding and (bii) 10,000,000 shares of preferred stockPreferred Stock, par value $1.00 par value per share share, of which, as of the date of this Agreement, no shares are issued and outstanding. All outstanding shares of Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. As of the date of this Agreement, Employee Options to purchase an aggregate of 610,500 shares of Common Stock are outstanding and warrants to purchase 435,000 shares of Common Stock are outstanding and held by Metropolitan Life Insurance Company, First Boston LBO, Inc. or their successors and assigns (the "Company Preferred StockWarrants"). As of October 31Except as set forth above and except as set forth on Schedule 2.2, 1997, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no written or oral options, subscriptions, warrants, convertible securities, calls, preemptive or rescission rights or other rights to acquire from the Company, and no obligation of the Company Common Stock were issuable upon the exercise to issue, deliver or conversion sell, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31equity equivalents (including, 1997without limitation, except as disclosed stock appreciation rights), interests in Section 4.4 the ownership or earnings of the Company Disclosure Scheduleor other similar rights (collectively, "Company Securities"). There are no outstanding obligations of the Company has not issued or any shares of its capital stock except upon subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth on Schedule 2.2, each of the exercise of such options, warrants or convertible securities. Each outstanding share shares of capital stock of each of the Company and each Subsidiary Company's subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) is directly or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer indirectly owned by the Company or either Subsidiary Company, free and clear of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock.all

Capitalization of the Company and its Subsidiaries. (a) The Company's authorized capital stock of the Company consists solely of (a) 20,000,000 100,000,000 shares of common stockstock of which, $0.05 par value per share ("Company Common Stock")as of the Closing, [4,929,313] shares were issued and outstanding, and (b) 10,000,000 50,000,000 shares of preferred stock, $1.00 par value per share 50,000,000 of which have been designated as Series A Preferred Stock ("Company Preferred Stock"). As all of October 31which will be sold to Investor pursuant to this Agreement) of which, 1997after giving effect to the transactions contemplated hereby, (i) 3,891,981 50,000,000 shares of Company Common Stock were issued and outstanding, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors of the Company and 154,175 shares of Company Common Stock were issuable upon the exercise or conversion of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iii) no shares of Company Series A Preferred Stock were will be issued and outstanding. Since October 31, 1997, except as disclosed in Section 4.4 of the Company Disclosure Schedule, the Company has not issued any All outstanding shares of its capital stock except upon the exercise of such options, warrants or convertible securities. Each outstanding share of capital stock of the Company have been validly issued, are fully paid, nonassessable and free of preempting rights and were issued in accordance with the registration or qualification provisions of the Securities Act of 1933, as amended (the "Securities Act") and any relevant state securities laws, or pursuant to valid exemptions therefrom. Except for the conversion privileges of the Series A Preferred Stock or as set forth on Schedule 2.2(a) hereof, as of the Closing, there are (i) no outstanding shares of capital stock or other voting securities of the Company; (ii) no outstanding securities of the Company convertible into or exchangeable for shares of capital stock or voting securities of the Company; (iii) no outstanding options, subscriptions, warrants, convertible securities, calls or other rights to acquire from the Company, and no obligation of the Company to issue, deliver or sell any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company; and (iv) no outstanding equity equivalents, performance shares, interests in the ownership or earnings of the Company or other similar rights issued by the Company (all stock and other securities described in this subsection (a) are collectively termed "Company Securities"). (b) Except as set forth on Schedule 2.2(b) hereto, there are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. (c) Except as set forth on Schedule 2.2(c) hereto, each Subsidiary of the outstanding shares of capital stock of each of the Company's subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and is directly or indirectly owned by the Company, free and clear of all security interests, liens, claims, pledges, charges, voting agreements or other encumbrances of any nature whatsoever (collectively, "Liens"). (d) Except as set forth on Schedule 2.2(d) hereto, there are no existing options, calls or commitments of any character relating to the issued or unissued capital stock or other equity securities of any subsidiary of the Company. (e) The Series A Preferred Stock, 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 any preemptive rights. As restrictions on transfer other than restrictions on transfer under this Agreement and the Registration Rights Agreement, dated as of the date hereof, between Investor and the Company (the "Registration Rights Agreement") and under applicable state and federal securities laws. The Common Stock issuable upon conversion of the Series A Preferred Stock has been duly and validly reserved for issuance and, upon issuance in accordance with the terms of the Articles of Incorporation, will be duly and validly issued, fully paid, and nonassessable and will be free of restrictions on transfer other than as set forth aboverestrictions on transfer under this Agreement, in the Company SEC Documents (as defined in Section 4.7) or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer by the Company or either Subsidiary of any Registration Rights Agreement and under applicable state and federal securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stocklaws.

Capitalization of the Company and its Subsidiaries. The Company's authorized -------------------------------------------------- capital stock of the Company consists solely of (ai) 20,000,000 30,000,000 shares of common stockCommon Stock, $0.05 par value $.01 per share ("Company share, of which, as of the date of this Agreement, 8,262,513 shares of Common Stock"), Stock are issued and outstanding and (bii) 10,000,000 shares of preferred stockPreferred Stock, par value $1.00 par value per share share, of which, as of the date of this Agreement, no shares are issued and outstanding. All outstanding shares of Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. As of the date of this Agreement, Employee Options to purchase an aggregate of 610,500 shares of Common Stock are outstanding and warrants to purchase 435,000 shares of Common Stock are outstanding and held by Metropolitan Life Insurance Company, First Boston LBO, Inc. or their successors and assigns (the "Company Preferred StockWarrants"). As of October 31Except as set forth above and except as set forth on Schedule 2.2, 1997, there are outstanding (i) 3,891,981 no shares of Company Common Stock were issued and outstandingcapital stock or other voting securities of the Company, (ii) 201,385 shares of Company Common Stock were issuable upon the exercise of outstanding options, an additional 230,749 shares of Company Common Stock were issuable upon the exercise of options that are not currently outstanding but are reserved for issuance upon the designation of optionees by the Board of Directors no securities of the Company and 154,175 convertible into or exchangeable for shares of capital stock or voting securities of the Company, (iii) no written or oral options, subscriptions, warrants, convertible securities, calls, preemptive or rescission rights or other rights to acquire from the Company, and no obligation of the Company Common Stock were issuable upon the exercise to issue, deliver or conversion sell, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of outstanding warrants or convertible securities granted or issuable (on a contingent basis or otherwise) by the Company, and (iiiiv) no shares of Company Preferred Stock were issued and outstanding. Since October 31equity equivalents (including, 1997without limitation, except as disclosed stock appreciation rights), interests in Section 4.4 the ownership or earnings of the Company Disclosure Scheduleor other similar rights (collectively, "Company Securities"). There are no outstanding obligations of the Company has not issued or any shares of its capital stock except upon subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. Except as set forth on Schedule 2.2, each of the exercise of such options, warrants or convertible securities. Each outstanding share shares of capital stock of each of the Company and each Subsidiary Company's subsidiaries is duly authorized and authorized, validly issued, fully paid and nonassessable and free of any preemptive rights. As of the date hereof, other than as set forth above, in the Company SEC Documents (as defined in Section 4.7) is directly or in Section 4.4 to the Company Disclosure Schedule, there are no outstanding shares of capital stock or subscriptions, options, warrants, puts, calls, agreements, understandings, claims or other commitments or rights of any type relating to the issuance, sale or transfer indirectly owned by the Company or either Subsidiary Company, free and clear of any securities of the Company or either Subsidiary, nor are there outstanding any securities which are convertible into or exchangeable for any shares of capital stock of the Company or either Subsidiary; and neither the Company nor either Subsidiary has any obligation of any kind to issue any additional securities or to pay for securities of the Company or either Subsidiary or any predecessor. The Company has no outstanding bonds, debentures, notes or other similar obligations the holders of which have the right to vote generally with holders of Company Common Stock.all