Common use of CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES Clause in Contracts

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of certain United States federal income tax consequences of the Offer and the Merger to the Company's shareholders whose Shares are tendered and accepted for payment pursuant to the Offer or whose Shares are converted into the right to receive cash in the Merger. The discussion is for general information only and does not purport to consider all aspects of United States federal income taxation that might be relevant to the Company's shareholders. The discussion is based on current provisions of the Internal Revenue Code of 1986, as amended (the "Code"), existing, proposed and temporary regulations promulgated under the Code and administrative and judicial interpretations of the Code, all of which are subject to change, possibly with a retroactive effect. The discussion applies only to the Company's shareholders in whose hands Shares are capital assets within the meaning of Section 1221 of the Code and who do not own directly or through attribution 50% or more of the stock of Parent. This discussion does not apply to Shares received pursuant to the exercise of employee stock options or otherwise as compensation, or to certain types of shareholders (such as insurance companies, tax-exempt organizations, financial institutions and broker-dealers) who may be subject to special rules. This discussion does not discuss the United States federal income tax consequences to any Company shareholder who, for United States federal income tax purposes, is a non-resident alien individual, a foreign corporation, a foreign partnership or a foreign estate or trust, nor does it consider the effect of any foreign, state or local tax laws. Because individual circumstances may differ, each shareholder should consult his or her own tax advisor to determine the applicability of the rules discussed below and the particular tax effects of the Offer and the Merger on a beneficial holder of Shares, including the application and effect of the alternative minimum tax, and any state, local and foreign tax laws and of changes in such laws. The payment for Shares tendered in the Offer or the exchange of Shares for cash pursuant to the Merger will be a taxable transaction for United States federal income tax purposes and likely will be for state, local and foreign income tax purposes as well. In general, a shareholder who sells Shares pursuant to the Offer or receives cash in exchange for Shares pursuant to the Merger will recognize gain or loss for United States federal income tax purposes equal to the difference, if any, between the amount of cash received and the shareholder's adjusted tax basis in the Shares sold pursuant to the Offer or exchanged for cash pursuant to the Merger. Gain or loss will be determined separately for each block of Shares (i.e., Shares acquired at the same cost in a single transaction) tendered pursuant to the Offer or exchanged for cash pursuant to the Merger. Such gain or loss will be long-term capital gain or loss provided that a shareholder's holding period for such Shares is more than one year at the time of consummation of the Offer or the Merger, as the case may be. Capital gains recognized by an individual upon a disposition of Shares that have been held for more than one year generally will be subject to a maximum United States federal income tax rate of 20% or, in the case of Shares that have been held for one year or less, will be subject to tax at ordinary income tax rates. If an individual is subject to the "alternative minimum tax," long-term capital gain can be subjected to a 28% maximum United States federal income tax rate. Certain limitations apply to the use of a shareholder's capital losses. A shareholder whose Shares are purchased in the Offer or exchanged pursuant to the Merger may be subject to 31% backup withholding unless certain information is provided to the Depositary or an exemption applies. See Section 3 -- "Procedures for Accepting the Offer and Tendering Shares".

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of certain United States federal income tax consequences of the Offer and the Merger to the Company's shareholders stockholders of Syntellect whose Shares are tendered and accepted for payment pursuant to the Offer or whose Shares are converted into the right to receive cash in the Merger. The discussion is for general information only and does not purport to consider all aspects of United States federal income taxation that might be relevant to the Company's shareholdersstockholders of Syntellect. The discussion is based on current provisions of the Internal Revenue Code of 1986, as amended (the "Code"), existing, proposed and temporary Treasury regulations promulgated under the Code thereunder and administrative and judicial interpretations of the Codethereof, all of which are subject to change, possibly with a retroactive effect. The discussion applies only to the Company's shareholders stockholders of Syntellect in whose hands Shares are capital assets within the meaning of Section 1221 of the Code and who do not own directly or through attribution 50% or more of the stock of ParentCode. This discussion does not apply to Shares received pursuant to the exercise of employee stock options or otherwise as compensation, compensation or to certain types of shareholders stockholders (such as insurance companies, tax-exempt organizations, financial institutions and broker-dealers) who which may be subject to special rules. This discussion does not discuss the United States federal income tax consequences to any Company shareholder stockholder of Syntellect who, for United States federal income tax purposes, is a non-resident alien individual, a foreign corporation, a foreign partnership or a foreign estate or trust, nor does it consider the effect of any foreign, state or local tax laws. Because individual circumstances may differBECAUSE INDIVIDUAL CIRCUMSTANCES MAY DIFFER, each shareholder should consult his or her own tax advisor to determine the applicability of the rules discussed below and the particular tax effects of the Offer and the Merger on a beneficial holder of SharesEACH STOCKHOLDER SHOULD CONSULT ITS TAX ADVISOR TO DETERMINE THE APPLICABILITY OF THE RULES DISCUSSED BELOW AND THE PARTICULAR TAX EFFECTS OF THE OFFER AND THE MERGER TO SUCH STOCKHOLDER, including the application and effect of the alternative minimum taxINCLUDING THE APPLICATION AND EFFECT OF THE ALTERNATIVE MINIMUM TAX AND ANY STATE, and any stateLOCAL, local and foreign tax laws and of changes in such lawsAND FOREIGN TAX LAWS. The payment for Shares tendered in the Offer or the exchange of Shares for cash pursuant to the Offer or the Merger will be a taxable transaction for United States federal income tax purposes and likely will be possibly for state, local local, and foreign income tax purposes as well. In general, a shareholder stockholder who sells Shares pursuant to the Offer or receives cash in exchange for Shares pursuant to the Merger will recognize capital gain or loss for United States federal income tax purposes equal to the difference, if any, between the amount of cash received and the shareholderstockholder's adjusted tax basis in the Shares sold pursuant to the Offer or exchanged for cash pursuant to the Merger. Gain or loss will be determined separately for each block of Shares (i.e., Shares acquired at the same cost in a single transaction) tendered pursuant to the Offer or exchanged for cash pursuant to the Merger. Such capital gain or loss will generally be long-term capital gain or loss provided that a shareholderstockholder's holding period for such Shares is more than one year at the time of consummation of the Offer or the Merger, as the case may be. Capital gains recognized by an individual upon a disposition of Shares that have been held for more than one year Such gain or loss will generally will be subject to a maximum United States federal income tax rate of 20% or, in the case of Shares that have been held for one year or less, will be subject to tax at ordinary income tax rates. If an individual is subject to the "alternative minimum tax," longshort-term capital gain can be subjected or loss if the holding period is less than or equal to a 28% maximum United States federal income tax rate. Certain limitations apply to the use one year at time of a shareholder's capital losses. A shareholder whose Shares are purchased in consummation of the Offer or exchanged pursuant to the Merger Merger, as the case may be subject to 31% backup withholding unless certain information is provided to the Depositary or an exemption applies. See Section 3 -- "Procedures for Accepting the Offer and Tendering Shares"be.

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of certain United States federal income tax consequences of the Offer and the Merger to the Company's shareholders whose Shares are tendered and accepted for payment pursuant to the Offer or whose Shares are converted into the right to receive cash in the Merger. The discussion set forth below is for general information only and does not purport to consider all aspects of United States federal income taxation that might be relevant to the Company's shareholders. The discussion is based on current provisions the law as currently in effect. The tax treatment of each Holder will depend in part upon such Xxxxxx's particular situation. Special tax consequences not described herein may be applicable to particular classes of taxpayers, such as financial institutions, broker-dealers, insurance companies, foreign corporations, foreign partnerships, foreign trusts, foreign estates, persons who are not citizens or residents of the United States, tax-exempt entities, Holders who acquired their Shares through the exercise of an employee stock option or otherwise as compensation, and persons who received payments in respect of options to acquire Shares. ALL HOLDERS SHOULD CONSULT WITH THEIR TAX ADVISORS AS TO THE PARTICULAR TAX CONSEQUENCES OF THE OFFER AND THE MERGER TO THEM, INCLUDING THE APPLICABILITY AND EFFECT OF THE ALTERNATIVE MINIMUM TAX AND ANY STATE, LOCAL OR FOREIGN INCOME OR OTHER TAX LAWS AND CHANGES IN SUCH TAX LAWS. The receipt of cash pursuant to the Offer or the Merger will be a taxable transaction for federal income tax purposes under the Internal Revenue Code of 1986, as amended (the "Code"), existingand may also be a taxable transaction under applicable state, proposed and temporary regulations promulgated under the Code and administrative and judicial interpretations of the Codelocal, all of which are subject to change, possibly with a retroactive effectforeign income or other tax laws. The discussion applies only to the Company's shareholders in whose hands Shares are capital assets within the meaning of Section 1221 of the Code and who do not own directly or through attribution 50% or more of the stock of Parent. This discussion does not apply to Shares received pursuant to the exercise of employee stock options or otherwise as compensation, or to certain types of shareholders (such as insurance companies, tax-exempt organizations, financial institutions and broker-dealers) who may be subject to special rules. This discussion does not discuss the United States federal income tax consequences to any Company shareholder whoGenerally, for United States federal income tax purposes, is a non-resident alien individual, a foreign corporation, a foreign partnership Holder will recognize gain or a foreign estate or trust, nor does it consider the effect of any foreign, state or local tax laws. Because individual circumstances may differ, each shareholder should consult his or her own tax advisor to determine the applicability of the rules discussed below and the particular tax effects of the Offer and the Merger on a beneficial holder of Shares, including the application and effect of the alternative minimum tax, and any state, local and foreign tax laws and of changes loss in such laws. The payment for Shares tendered in the Offer or the exchange of Shares for cash pursuant an amount equal to the Merger will be a taxable transaction for United States federal income tax purposes and likely will be for state, local and foreign income tax purposes as well. In general, a shareholder who sells Shares difference between the cash received by the Holder pursuant to the Offer or receives cash in exchange for Shares pursuant to the Merger will recognize gain or loss for United States federal income tax purposes equal to the difference, if any, between the amount of cash received and the shareholderHolder's adjusted tax basis in the Shares sold purchased pursuant to the Offer or exchanged for converted to cash pursuant to in the Merger. Gain or loss will be determined calculated separately for each block of Shares (i.e., Shares acquired at the same cost in a single transaction) tendered and purchased pursuant to the Offer or exchanged for cash pursuant to the Merger. Such gain or loss will be long-term capital gain or loss provided that a shareholder's holding period for such Shares is more than one year at the time of consummation of the Offer or converted in the Merger, as the case may be. Capital gains recognized by an individual upon For federal income tax purposes, such gain or loss will be a disposition capital gain or loss if the Shares are a capital asset in the hands of the Holder, and a long-term capital gain or loss if the Holder's holding period is more than one year as of the date the Purchaser accepts such Shares that have been for payment pursuant to the Offer or the effective date of the Merger, as the case may be. In the case of a noncorporate Holder, capital gain is currently eligible for reduced rates of taxation if the Shares were held for more than one year generally will be subject to a maximum United States federal income tax rate year. There are limitations on the deductibility of 20% or, in the case of Shares that have been held for one year or less, will be subject to tax at ordinary income tax rates. If an individual is subject to the "alternative minimum tax," long-term capital gain can be subjected to a 28% maximum United States federal income tax rate. Certain limitations apply to the use of a shareholder's capital losses. A shareholder whose Shares are purchased in All Holders should consult their own tax advisors to determine the Offer U.S., federal, state, local or exchanged pursuant to the Merger foreign income or other tax consequences that may be subject relevant to 31% backup withholding unless certain information is provided to the Depositary or an exemption applies. See Section 3 -- "Procedures for Accepting the Offer and Tendering Shares"them.

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of certain United States federal income tax consequences of the Offer and the Merger offer to the Company's shareholders United States Holders (as defined below) whose Shares shares are tendered and accepted for payment pursuant to the Offer or whose Shares are converted into the right to receive cash offer. Those shareholders who do not participate in the Merger. The discussion is for general information only and does offer should not purport to consider all aspects of incur any United States federal income taxation that might be relevant to tax liability from the Company's shareholdersexchange. The discussion This summary is based on current provisions of upon the Internal Revenue Code of 1986, as amended (the "Code"), existing, existing and proposed and temporary regulations United States Treasury Regulations promulgated under the Code and Code, published rulings, administrative pronouncements and judicial interpretations decisions, any changes to which could affect the tax consequences described in this Offer to Purchase (possibly on a retroactive basis). This summary assumes that shares held by shareholders are held as capital assets. It does not address all of the Codetax consequences that may be relevant to particular shareholders in light of their personal circumstances, all or to other types of which shareholders subject to special rules (including, without limitation, certain financial institutions, brokers, dealers or traders in securities or commodities, insurance companies, S corporations, expatriates, tax-exempt organizations, Non-United States Holders (as defined below), persons who are subject to changealternative minimum tax, possibly with or persons who hold shares as a retroactive effect. The discussion applies only to position in a straddle or as part of a hedging or conversion transaction, persons that have a functional currency other than the Company's shareholders in whose hands Shares are capital assets within the meaning of Section 1221 of the Code and United States dollar, or persons who do not own directly or through attribution 50% or more of the stock of Parent. This discussion does not apply to Shares received pursuant to acquired their shares upon the exercise of employee stock options or otherwise as compensation, or to certain types of shareholders (such as insurance companies, tax-exempt organizations, financial institutions and broker-dealers) who may be subject to special rules). This discussion summary also does not discuss address the state, local, foreign or other tax consequences of participating in the offer. YOU ARE URGED TO CONSULT YOUR TAX ADVISOR AS TO THE PARTICULAR CONSEQUENCES TO YOU OF PARTICIPATING IN THIS OFFER. A United States federal income tax consequences to any Company shareholder who, for United States federal income tax purposes, Holder is a non-resident alien individual, a foreign corporation, a foreign partnership or a foreign estate or trust, nor does it consider the effect of any foreign, state or local tax laws. Because individual circumstances may differ, each shareholder should consult his or her own tax advisor to determine the applicability of the rules discussed below and the particular tax effects of the Offer and the Merger on a beneficial holder of Shares, including the application and effect of the alternative minimum tax, and any state, local and foreign tax laws and of changes in such laws. The payment for Shares tendered in the Offer or the exchange of Shares for cash pursuant to the Merger will be a taxable transaction shares that for United States federal income tax purposes and likely will be for state, local and foreign is: - a citizen or resident of the United States; - a corporation or partnership created or organized in or under the laws of the United States or any State or the District of Columbia; - an estate the income tax purposes as well. In general, a shareholder who sells Shares pursuant of which is subject to the Offer or receives cash in exchange for Shares pursuant to the Merger will recognize gain or loss for United States federal income tax purposes equal to taxation regardless of its source; or - a trust (a) the difference, if any, between the amount of cash received administration over which a United States court can exercise primary supervision and the shareholder's adjusted tax basis in the Shares sold pursuant to the Offer or exchanged for cash pursuant to the Merger. Gain or loss will be determined separately for each block of Shares (i.e., Shares acquired at the same cost in a single transactionb) tendered pursuant to the Offer or exchanged for cash pursuant to the Merger. Such gain or loss will be long-term capital gain or loss provided that a shareholder's holding period for such Shares is more than one year at the time of consummation all of the Offer substantial decisions of which one or the Merger, as the case may be. Capital gains recognized by an individual upon a disposition of Shares that have been held for more than one year generally will be subject to a maximum United States persons have the authority to control and certain other trusts considered United States Holders for federal income tax rate of 20% or, in the case of Shares that have been held for one year or less, will be subject to tax at ordinary income tax rates. If an individual is subject to the "alternative minimum tax," long-term capital gain can be subjected to a 28% maximum United States federal income tax rate. Certain limitations apply to the use of a shareholder's capital losses. A shareholder whose Shares are purchased in the Offer or exchanged pursuant to the Merger may be subject to 31% backup withholding unless certain information is provided to the Depositary or an exemption applies. See Section 3 -- "Procedures for Accepting the Offer and Tendering Shares"purposes.

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of certain United States federal income tax consequences of the Offer and the Merger to stockholders of the Company's shareholders Company whose Shares are tendered and accepted for payment pursuant to the Offer or whose Shares are converted into the right to receive cash in the Merger. It does not address tax consequences applicable to holders of Options, SARs, Restricted Stock, Performance Awards, RSUs, performance units or performance shares. The discussion summary is for general information only and does not purport to consider all aspects of United States federal income taxation that might be relevant to stockholders of the Company's shareholders. The discussion summary is based on current provisions of the Internal Revenue Code of 1986, as amended (the "Code"), existing, proposed and temporary regulations promulgated under the Code thereunder and administrative and judicial interpretations of the Codethereof, all of which are subject to change, possibly with a retroactive effect. Purchaser and Parent have not sought, and do not intend to seek, any ruling from the IRS with respect to the statements made and the conclusions reached in the following summary, and no assurance can be given that the IRS will agree with the views expressed herein, or that a court will not sustain any challenge by the IRS in the event of litigation. The discussion summary applies only to stockholders of the Company's shareholders Company in whose hands the Shares are capital assets within the meaning of Section 1221 of the Code and who do Code. This summary does not own directly address foreign, state or through attribution 50% or more local tax consequences of the Offer or the Merger, nor does it purport to address the United States federal income tax consequences of the transactions to stockholders who will actually or constructively own any stock of Parent. This discussion does not apply the Company following the Offer and the Merger, to Shares received pursuant to holders of equity awards under the exercise of employee stock options or otherwise as compensationCompany's equity compensation plans, or to special classes of taxpayers (e.g., small business investment companies, personal holding companies, regulated investment companies, real estate investment trusts, controlled foreign corporations, passive foreign investment companies, cooperatives, banks and certain types of shareholders (such as other financial institutions, insurance companies, tax-exempt organizations, financial institutions and brokerretirement plans or other tax-dealers) who may be subject to special rules. This discussion does not discuss the United States federal income tax consequences to any Company shareholder whodeferred accounts, stockholders that are, or hold Shares through, partnerships or other pass-through entities for United States federal income tax purposes, United States persons whose functional currency is a nonnot the United States dollar, dealers in securities or foreign currency, traders that mark-resident alien individualto-market their securities, a foreign corporation, a foreign partnership or a foreign estate or trust, nor does it consider the effect of any foreign, state or local tax laws. Because individual circumstances may differ, each shareholder should consult his or her own tax advisor to determine the applicability expatriates and former long-term residents of the rules discussed below and the particular tax effects of the Offer and the Merger on a beneficial holder of SharesUnited States, including the application and effect of persons subject to the alternative minimum tax, stockholders holding Shares that are part of a straddle, hedging, constructive sale, conversion or other risk reduction strategy or integrated transaction, and any statestockholders who received Shares in compensatory transactions, local and foreign tax laws and of changes in such laws. The payment for Shares tendered in the Offer or the exchange of Shares for cash pursuant to the Merger will be exercise or vesting of Options, SARs, Restricted Stock, Performance Awards, RSUs, performance units or performance shares, through a taxable transaction for tax qualified retirement plan or otherwise as compensation). In addition, this summary does not address taxes other than United States federal income tax purposes and likely will be for state, local and foreign income tax purposes as well. In general, a shareholder who sells Shares pursuant to the Offer or receives cash in exchange for Shares pursuant to the Merger will recognize gain or loss for United States federal income tax purposes equal to the difference, if any, between the amount of cash received and the shareholder's adjusted tax basis in the Shares sold pursuant to the Offer or exchanged for cash pursuant to the Merger. Gain or loss will be determined separately for each block of Shares (i.e., Shares acquired at the same cost in a single transaction) tendered pursuant to the Offer or exchanged for cash pursuant to the Merger. Such gain or loss will be long-term capital gain or loss provided that a shareholder's holding period for such Shares is more than one year at the time of consummation of the Offer or the Merger, as the case may be. Capital gains recognized by an individual upon a disposition of Shares that have been held for more than one year generally will be subject to a maximum United States federal income tax rate of 20% or, in the case of Shares that have been held for one year or less, will be subject to tax at ordinary income tax rates. If an individual is subject to the "alternative minimum tax," long-term capital gain can be subjected to a 28% maximum United States federal income tax rate. Certain limitations apply to the use of a shareholder's capital losses. A shareholder whose Shares are purchased in the Offer or exchanged pursuant to the Merger may be subject to 31% backup withholding unless certain information is provided to the Depositary or an exemption applies. See Section 3 -- "Procedures for Accepting the Offer and Tendering Shares"taxes.

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of discussion describes certain United States federal income tax consequences of the Offer and the Merger to the Company's shareholders whose Shares are tendered and accepted for payment pursuant to the Offer or whose Shares are converted into the right to receive cash participating in the Merger. The discussion Offer, is for general information only and does not purport to consider all aspects of United States federal income taxation that might may be relevant to the Companystockholders. The consequences to any particular stockholder may differ depending upon that stockholder's shareholdersown circumstances and tax position. The discussion is based on current provisions deals only with Shares held as capital assets within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the "Code"), existing, proposed ) and temporary regulations promulgated under the Code and administrative and judicial interpretations of the Code, all of which are subject to change, possibly with a retroactive effect. The discussion applies only to the Company's shareholders in whose hands Shares are capital assets within the meaning of Section 1221 of the Code and who do not own directly or through attribution 50% or more of the stock of Parent. This discussion does not apply address what may be relevant to stockholders in special tax situations, such as financial institutions, insurance companies, stockholders liable for the alternative minimum tax, dealers in securities or currencies, tax-exempt organizations, foreign persons, persons who acquired their Shares received pursuant to upon the exercise of employee stock options or otherwise as compensationcompensation and persons who are holding such Shares as part of a straddle, conversion, hedge or to certain types of shareholders (such as insurance companieshedging transaction, tax-exempt organizations, financial institutions and broker-dealers) who may be subject to special rules. This The discussion does not discuss the United States federal income tax consequences to any Company shareholder who, for United States federal income tax purposes, is a non-resident alien individual, a foreign corporation, a foreign partnership or a foreign estate or trust, nor does it consider the effect of any applicable foreign, state or local tax laws. Because individual circumstances may differIn addition, each shareholder should consult his or her own the impact of pending and future budget and tax advisor to determine legislation on the applicability United States federal tax system, including possible effects on taxation of the rules discussed below and the particular tax effects of the Offer and the Merger on a beneficial holder of SharesOffer, including the application and effect of the alternative minimum taxis uncertain. EACH STOCKHOLDER IS URGED TO CONSULT HIS TAX ADVISOR AS TO THE PARTICULAR TAX CONSEQUENCES OF THE OFFER TO SUCH STOCKHOLDER, and any stateINCLUDING THE APPLICATIONS OF STATE, local and foreign tax laws and of changes in such lawsLOCAL AND FOREIGN TAX LAWS AND POSSIBLE TAX LAW CHANGES. The payment for Shares tendered in the Offer or the exchange sale of Shares for cash pursuant to the Merger Offer will be a taxable transaction for United States federal income tax purposes and likely will be for state, local and foreign purposes. The United States federal income tax purposes as wellconsequences to a stockholder may vary depending on the stockholder's particular facts and circumstances. In generalUnder the stock redemption rules of Section 302 of the Code, a shareholder who sells Shares sale by a stockholder to the Company pursuant to the Offer will be treated as a "sale or receives cash in exchange for exchange" of such Shares pursuant (rather than as a distribution by the Company with respect to the Merger will recognize gain Shares held by the tendering stockholder) if the receipt of cash upon such sale: (a) results in a "complete redemption" of the stockholder's stock in the Company, (b) is "substantially disproportionate" with respect to the stockholder or loss (c) is "not essentially equivalent to a dividend" with respect to the stockholder (each as described below). If any of the three above tests is satisfied, and the sale is therefore treated as a "sale or exchange" of such Shares for United States federal income tax purposes purposes, the tendering stockholder will recognize gain or loss equal to the difference, if any, difference between the amount of cash received by the stockholder pursuant to the Offer and the shareholderstockholder's adjusted tax basis in the Shares sold pursuant to the Offer or exchanged for cash pursuant to the MergerOffer. Gain Any such gain or loss will be determined separately for each block of Shares (i.e., Shares acquired at the same cost in a single transaction) tendered pursuant to the Offer or exchanged for cash pursuant to the Merger. Such capital gain or loss and will be long-term capital gain or loss provided that a shareholder's holding period for if such Shares is more than one year at the time of consummation of the Offer or the Merger, as the case may be. Capital gains recognized by an individual upon a disposition of Shares that have been held for more than one year year. Therefore, a tendering stockholder may wish to take the various bases and holding periods of such stockholder's Shares into account, if such characteristics are not uniform, in determining which Shares to tender. If none of the three tests described above is satisfied with respect to a stockholder, such stockholder will be treated as having received a distribution, taxable as a dividend to the extent of the Company's available "earnings and profits", in an amount equal to the amount of cash received by the stockholder pursuant to the Offer (without reduction for the tax basis of the Shares sold pursuant to the Offer), no loss will be recognized, and the tendering stockholder's basis in the Shares sold pursuant to the Offer will be added to such stockholder basis in his remaining Shares, if any. Any cash received in excess of such earnings and profits will be treated, first, as a non-taxable return of capital to the extent of the stockholder's basis in all of his Shares, and, thereafter, as a capital gain to the extent it exceeds the stockholder's basis. The Company anticipates, but there can be no assurance, that its available earnings and profits will be such that all amounts treated as a distribution will be taxed as a dividend. The distinction between long-term capital gains and ordinary income is relevant because certain individuals are subject to taxation at a reduced rate on the excess of net long-term capital gains over net short-term capital losses. In addition, legislation currently under consideration would provide for reduced taxation of net long-term capital gains compared to the rates currently applicable to such income. Stockholders are urged to consult their own tax advisors regarding any possible impact on their obligation to make estimated tax payments as a result of the recognition of any capital gain (or the receipt of any ordinary income) caused by the sale of any Shares to the Company pursuant to the Offer. In determining whether any of the tests under Section 302 is satisfied, a stockholder must take into account both Shares actually owned by such stockholder and any Shares considered as owned by such stockholder by reason of certain constructive ownership rules set forth in Section 318 of the Code. Under these rules an individual stockholder generally will be subject considered to own Shares which such stockholder has the right to acquire by the exercise of an option or warrant and Shares owned (and, in some cases, constructively owned) by certain members of the stockholder's family and by certain entities (such as corporations, partnerships, trusts and estates) in which such stockholder, a member of such stockholder's family or a related entity has an interest. Under Section 318, participants in the ESOP will not be considered to own Shares held by the ESOP and attributable to participants' accounts ("ESOP Shares"). ESOP participants may also actually own or be considered to own Shares ("Non-ESOP Shares") other than ESOP Shares. Whether an ESOP participant satisfies one of the three tests under Section 302 with respect to a maximum United States federal income sale of Non-ESOP Shares pursuant to the Offer is determined without regard to ESOP Shares. A sale of Shares pursuant to the Offer will result in a "complete redemption" of a stockholder's stock in the Company if, pursuant to the Offer, either (i) the Company purchases all of the Shares actually and constructively owned by the stockholder pursuant to the Offer and the stockholder holds no other stock of the Company or (ii) all Shares actually owned by the stockholder are sold pursuant to the Offer and, with respect to constructively owned Shares, such stockholder is eligible to waive (and effectively waives) constructive ownership of all such Shares under procedures described in Section 302(c) of the Code. Stockholders in this position should consult their tax rate advisors as to the availability of 20such a waiver. The sale of Shares pursuant to the Offer will be "substantially disproportionate" with respect to a stockholder if, immediately after the sale pursuant to the Offer (treating as not outstanding all Shares purchased pursuant to the Offer), such stockholder's actual and constructive percentage ownership of Shares is less than 80% orof the stockholder's actual and constructive percentage ownership of Shares immediately before the purchase of Shares pursuant to the Offer (treating as outstanding all Shares purchased pursuant to the Offer). In order for the sale of Shares by a stockholder pursuant to the Offer to qualify as "not essentially equivalent to a dividend" the stockholder must experience a "meaningful reduction" in his proportionate interest in the Company as a result of such sale, taking into account the constructive ownership rules. The Internal Revenue Service has held in a published ruling that, under the particular facts of that ruling, a very small reduction in the percentage stock ownership of a stockholder constituted a "meaningful reduction" when the stockholder owned an insignificant percentage of the corporation's stock before and after a redemption and did not exercise any control over corporate affairs and where, as expected in the case of the Offer, payments are not pro rata with respect to all outstanding Shares. Whether the receipt of cash by a stockholder pursuant to the Offer will result in a meaningful reduction of the stockholder's proportionate interest will depend on the stockholder's particular facts and circumstances. Stockholders seeking to rely on this test should consult their tax advisors as to the application of this standard to their particular situations. Stockholders should be aware that their ability to satisfy any of the foregoing tests may be affected by any proration pursuant to the Offer. While not free from doubt, it is possible that an acquisition or disposition of Shares that have been held for one year or less, (including market purchases and sales) substantially contemporaneous with the Offer will be taken into account in determining whether any of the three tests described above is satisfied. Any income which is treated as a dividend pursuant to the rules described above will be eligible for the 70% dividends received deduction generally allowable to corporate stockholders under Section 243 of the Code, subject to tax at ordinary income tax ratesapplicable limitations, including those relating to "debt-financed portfolio stock" under Section 246A of the Code and to the holding period requirement of Section 246 of the Code. If Also, since it is expected that purchases pursuant to the Offer will not be pro rata as to all stockholders, any amount treated as a dividend to a corporate stockholder will constitute an individual is "extraordinary dividend" subject to the provisions of Section 1059 of the Code (except as may otherwise be provided in regulations yet to be promulgated by the Treasury Department). Under Section 1059, a corporate stockholder must reduce the tax basis in all of such stockholder's stock (but not below zero) by the "alternative minimum tax,nontaxed portion" long-term capital of any "extraordinary dividend" and, if such portion exceeds the stockholder's tax basis for the stock, must treat any such excess as additional gain can be subjected on the subsequent sale or other disposition of such Shares. Corporate stockholders should also consider the effect of pending legislative proposals that, if enacted in their current form, could affect the dividends received deduction to a 28% maximum United States federal income corporate stockholders that participate in the Offer. Corporate stockholders should consult their tax rate. Certain limitations apply advisors as to the use application of a shareholder's capital losses. A shareholder whose Shares are purchased in Section 1059 of the Offer or exchanged pursuant Code to the Merger may be subject Offer. For a discussion of certain withholding tax consequences to 31% backup withholding unless certain information is provided to the Depositary or an exemption appliestendering stockholders, see Section 3. See Section 3 -- "Procedures for Accepting the Offer and Tendering Shares"THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY. EACH STOCKHOLDER IS URGED TO CONSULT SUCH STOCKHOLDER'S OWN TAX ADVISOR TO DETERMINE THE PARTICULAR TAX CONSEQUENCES TO SUCH STOCKHOLDER (INCLUDING THE APPLICABILITY AND EFFECT OF THE CONSTRUCTIVE OWNERSHIP RULES AND FOREIGN, STATE AND LOCAL TAX LAWS AND POSSIBLE TAX LAW CHANGES) OF THE SALE OF SHARES PURSUANT TO THE OFFER.

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following discussion is a summary of certain United States U.S. federal income tax consequences of the Offer and the Merger considerations relevant to the Company's shareholders whose Shares are tendered and accepted for payment sale of Notes pursuant to the Offer or whose Shares are converted into the right to receive cash in the MergerOffer. The discussion This summary is based on current law, is for general information only and does is not purport to consider all aspects of United States federal income taxation that might be relevant to the Company's shareholderstax advice. The This discussion is based on current provisions limited to persons who hold Notes as “capital assets” (generally, property held for investment within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the "“Code"”)). Your tax treatment will vary depending on your particular situation, existingand this discussion does not address all the tax consequences that may be relevant to you in light of your particular circumstances. If you are considering a sale of Notes pursuant to the Offer, proposed and temporary regulations promulgated you should consult your tax advisors concerning the application of United States federal income tax laws to your particular situation as well as any consequences arising under the Code and administrative and judicial interpretations laws of the Codeany state, all of which are subject to change, possibly with a retroactive effect. The discussion applies only to the Company's shareholders in whose hands Shares are capital assets within the meaning of Section 1221 of the Code and who do not own directly local or through attribution 50% or more of the stock of Parentforeign taxing jurisdiction. This discussion does not apply address the tax consequences relevant to Shares received pursuant to the exercise of employee stock options or otherwise as compensation, or to certain types of shareholders (such as insurance companies, tax-exempt organizations, financial institutions and broker-dealers) persons who may be subject to receive special rules. This discussion does not discuss treatment under the United States federal income tax consequences law, except to any Company shareholder whothe extent discussed below under the heading “—Non-U.S. Holders.” Holders receiving special treatment include, for United States federal income tax purposeswithout limitation: • financial institutions, is banks and thrifts, • insurance companies, • tax-exempt organizations, • “S” corporations, • traders in securities that elect to mark to market, • persons holding Notes through a non-resident alien individual, a foreign corporation, a foreign partnership or a foreign estate or trustother pass-through entity, nor does it consider the effect of any foreign, state or local tax laws. Because individual circumstances may differ, each shareholder should consult his or her own tax advisor • holders subject to determine the applicability of the rules discussed below and the particular tax effects of the Offer and the Merger on a beneficial holder of Shares, including the application and effect of the alternative minimum tax, • regulated investment companies and any stateREITs, local • foreign corporations or partnerships, and foreign tax laws and persons who are not residents or citizens of changes the United States, • broker-dealers or dealers in such lawssecurities or currencies, • United States expatriates, • persons holding Notes as a hedge against currency risks or as a position in a straddle, or • United States persons whose functional currency is not the United States dollar. The payment for Shares tendered information in this summary is based on: • the Code, • current, temporary and proposed United States Treasury (the “Treasury”) regulations promulgated under the Code, • the legislative history of the Code, • current administrative interpretations and practices of the Internal Revenue Service (the “IRS”) and • court decisions, in each case, as of the date of this Offer or to Purchase. In addition, the exchange administrative interpretations and practices of Shares for cash the IRS include its practices and policies as expressed in private letter rulings which are not binding on the IRS except with respect to the particular taxpayers who requested and received those rulings. Future legislation, Treasury regulations, administrative interpretations and practices and/or court decisions may adversely affect the tax considerations described in this summary. Any such change could apply retroactively to transactions preceding the date of the change. We have not sought and will not seek any rulings from the IRS concerning the tax consequences of the sale of Notes pursuant to the Merger Offer, and the statements in this summary are not binding on the IRS or any court. Thus, we can provide no assurance that the tax considerations contained in this summary will not be challenged by the IRS or will be sustained by a taxable transaction for United States federal income tax purposes and likely will be for statecourt if so challenged. State, local and foreign income tax purposes as welllaws may differ substantially from any corresponding U.S. federal income tax laws. In generalThis discussion does not address any aspect of the laws of any state, a shareholder who sells Shares local or foreign jurisdiction. You are urged to consult your tax advisors with respect to the U.S. federal income tax consequences of the sale of Notes pursuant to the Offer Offer, as well as any tax consequences applicable under the laws of any U.S. state, local, or receives cash non-U.S. taxing jurisdiction and other U.S. federal tax laws. U.S. Holders If you are a “U.S. Holder,” as defined below, this section applies to you. If you are a beneficial owner of Notes and are not a “U.S. Holder,” you are a “Non-U.S. Holder” and the section below entitled “Non-U.S. Holders” applies to you. A “U.S. Holder” is a beneficial owner of Notes that for U.S. federal income tax purposes is: • an individual citizen or resident of the United States, • a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in exchange for Shares pursuant or under the laws of the United States or of any state thereof or in the District of Columbia, • an estate the income of which is subject to the Merger will recognize gain or loss for United States federal income tax purposes equal to the differencetaxation regardless of its source, if any, between the amount of cash received and the shareholder's adjusted tax basis in the Shares sold pursuant to the Offer or exchanged for cash pursuant to the Merger. Gain or loss will be determined separately for each block of Shares • a trust (i.e., Shares acquired at the same cost in a single transactioni) tendered pursuant to the Offer or exchanged for cash pursuant to the Merger. Such gain or loss will be long-term capital gain or loss provided that a shareholder's holding period for such Shares is more than one year at the time of consummation of the Offer or the Merger, as the case may be. Capital gains recognized by an individual upon a disposition of Shares that have been held for more than one year generally will be subject to a maximum United States federal income tax rate of 20% or, in the case of Shares that have been held for one year or less, will be subject to tax at ordinary income tax rates. If an individual whose administration is subject to the "alternative minimum tax," long-term capital gain can be subjected to primary supervision of a 28% maximum United States federal income tax rate. Certain limitations apply court and which has one or more United States persons who have the authority to control all substantial decisions of the use of trust, or (ii) that has a shareholder's capital losses. A shareholder whose Shares are purchased valid election in the Offer or exchanged pursuant place to the Merger may be subject to 31% backup withholding unless certain information is provided to the Depositary or an exemption applies. See Section 3 -- "Procedures for Accepting the Offer and Tendering Shares"treated as a United States person.

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of certain United States federal income tax consequences of the Offer and the Merger to the Company's shareholders stockholders of Encysive whose Shares are tendered and accepted for payment pursuant to the Offer or whose Shares are converted into the right to receive cash in the Merger. The discussion is for general information only and does not purport to consider all aspects of United States federal income taxation that might be relevant to the Company's shareholdersstockholders of Encysive. The discussion is based on current provisions of the Internal Revenue Code of 1986, as amended (the "“Code"”), existing, proposed and temporary regulations promulgated under the Code thereunder and administrative and judicial interpretations of the Codethereof, all of which are subject to change, possibly with a retroactive effect. The discussion applies only to the Company's shareholders stockholders of Encysive in whose hands Shares are capital assets within the meaning of Section 1221 of the Code and who do not own directly or through attribution 50% or more of the stock of ParentCode. This discussion does not apply to Shares received pursuant to the exercise of employee stock options or otherwise as compensation, or to certain types of shareholders stockholders (such as insurance companies, tax-exempt organizations, financial institutions and broker-dealers) who may be subject to special rules. This discussion does not discuss the United States federal income tax consequences to any Company shareholder stockholder of Encysive who, for United States federal income tax purposes, is a non-resident nonresident alien individual, a foreign corporation, a foreign partnership or a foreign estate or trust, nor does it consider the effect of any foreign, state or local tax laws. Because individual circumstances may differ, each shareholder stockholder should consult its, his or her own tax advisor to determine the applicability of the rules discussed below and the particular tax effects of the Offer and the Merger on a beneficial holder of Shares, including the application and effect of the alternative minimum tax, tax and any state, local and foreign tax laws and of changes in such laws. The payment for Shares tendered in the Offer or the exchange of Shares for cash pursuant to the Offer or the Merger will be a taxable transaction for United States federal income tax purposes and likely will be for state, local and foreign income tax purposes as wellpurposes. In general, a shareholder stockholder who sells Shares pursuant to the Offer or receives cash in exchange for Shares pursuant to the Merger will recognize gain or loss for United States federal income tax purposes in an amount equal to the difference, if any, between the amount of cash received and the shareholder's stockholder’s adjusted tax basis in the Shares sold pursuant to the Offer or exchanged for cash pursuant to the Merger. Gain or loss will be determined separately for each block of Shares (i.e.that is, Shares acquired at the same cost in a single transaction) tendered pursuant to the Offer or exchanged for cash pursuant to the Merger. Such gain or loss will be long-term capital gain or loss provided that a shareholder's stockholder’s holding period for such Shares is more than one year at the time of consummation of the Offer or the Merger, as the case may be. Capital gains recognized by an individual upon a disposition of Shares a Share that have has been held for more than one year generally will be subject to a maximum United States federal income tax rate of 20% or, in 15%. In the case of Shares a Share that have has been held for one year or less, such capital gains generally will be subject to tax at ordinary income tax rates. If an individual is subject to the "alternative minimum tax," long-term capital gain can be subjected to a 28% maximum United States federal income tax rate. Certain limitations apply to the use of a shareholder's stockholder’s capital losses. A shareholder stockholder whose Shares are purchased in the Offer or exchanged for cash pursuant to the Merger may be subject to 31% backup withholding unless certain information is provided to the Depositary or an exemption applies. See Section 3 -- "— “Procedures for Accepting the Offer and Tendering Shares".”

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of certain United States the principal federal income tax consequences of the Offer and the Merger to the Company's shareholders holders whose Shares are tendered and accepted for payment purchased pursuant to the Offer or whose Shares are converted into the right to receive cash in the Merger. The discussion is for general information only and does not purport to consider all aspects Merger (whether upon receipt of United States federal income taxation that might be relevant the Merger Consideration or pursuant to the Companyproper exercise of dissenter's shareholders. The discussion is based on current provisions of the Internal Revenue Code of 1986, as amended (the "Code"rights), existing, proposed and temporary regulations promulgated under the Code and administrative and judicial interpretations of the Code, all of which are subject to change, possibly with a retroactive effect. The discussion applies only to the Company's shareholders holders of Shares in whose hands Shares are capital assets within the meaning of Section 1221 of the Code assets, and who do not own directly or through attribution 50% or more of the stock of Parent. This discussion does may not apply to Shares received pursuant to the exercise of employee stock options or otherwise as compensation, or to certain types holders of shareholders (such as insurance companies, tax-exempt organizations, financial institutions and broker-dealers) Shares who may be subject to special rules. This discussion does are not discuss citizens or residents of the United States federal income tax consequences to any Company shareholder whoof America. THE TAX DISCUSSION SET FORTH BELOW IS INCLUDED FOR GENERAL INFORMATION PURPOSES ONLY AND IS BASED UPON PRESENT LAW. BECAUSE INDIVIDUAL CIRCUMSTANCES MAY DIFFER, for United States federal income tax purposesEACH HOLDER OF SHARES SHOULD CONSULT SUCH HOLDER'S OWN TAX ADVISOR TO DETERMINE THE APPLICABILITY OF THE RULES DISCUSSED TO SUCH STOCKHOLDER AND THE PARTICULAR TAX EFFECTS OF THE OFFER AND THE MERGER, is a non-resident alien individualINCLUDING THE APPLICATION AND EFFECT OF STATE, a foreign corporation, a foreign partnership or a foreign estate or trust, nor does it consider the effect of any foreign, state or local tax lawsLOCAL AND OTHER TAX LAWS. Because individual circumstances may differ, each shareholder should consult his or her own tax advisor to determine the applicability The receipt of the rules discussed below offer price and the particular tax effects receipt of the Offer and the Merger on a beneficial holder of Shares, including the application and effect of the alternative minimum tax, and any state, local and foreign tax laws and of changes in such laws. The payment for Shares tendered in the Offer or the exchange of Shares for cash pursuant to the Merger (whether as Merger Consideration or pursuant to the proper exercise of dissenter's rights) will be a taxable transaction for United States federal income tax purposes (and likely will also may be for a taxable transaction under applicable state, local and foreign other income tax purposes as welllaws). In general, for federal income tax purposes, a shareholder who sells holder of Shares pursuant to the Offer or receives cash in exchange for Shares pursuant to the Merger will recognize gain or loss for United States federal income tax purposes equal to the difference, if any, difference between the amount of cash received and the shareholdersuch holder's adjusted tax basis in the Shares sold pursuant to the Offer or exchanged for converted to cash pursuant to in the MergerMerger and the amount of cash received therefor. Gain or loss will must be determined separately for each block of Shares (i.e., Shares acquired at the same cost in a single transaction) tendered sold pursuant to the Offer or exchanged for converted to cash pursuant to in the Merger. Such gain or loss will be long-term capital gain or loss provided that a shareholder's holding period for such Shares is more than one year at the time of consummation of the Offer or the Merger, as the case may beloss. Capital gains recognized by an individual upon a disposition of Shares that have been held for more than one year generally will be subject to a maximum United States federal income tax rate of 20% or, in the case of Shares that have been held for one year or less, Individual holders will be subject to tax on the net amount of such gain at ordinary income a maximum rate of 20% provided that the Shares were held for more than 12 months. Special rules (and generally lower maximum rates) apply to individuals in lower tax ratesbrackets. If an individual The deduction of capital losses is subject to the "alternative minimum tax," long-term capital gain can be subjected to a 28% maximum United States federal income certain limitations. Stockholders should consult their own tax rateadvisors in this regard. Certain limitations apply to the use of a shareholder's capital losses. A shareholder whose Shares are purchased Payments in connection with the Offer or exchanged pursuant to the Merger may be subject to backup withholding at a 31% rate. Backup withholding generally applies if a stockholder (i) fails to furnish such stockholder's social security number or taxpayer identification number ("TIN"), (ii) furnishes an incorrect TIN, (iii) fails properly to report interest or dividends or (iv) under certain circumstances, fails to provide a certified statement, signed under penalties of perjury, that the TIN provided is such stockholder's correct number and that such stockholder is not subject to backup withholding. Backup withholding unless certain information is provided not an additional tax but merely an advance payment, which may be refunded to the Depositary or extent it results in an overpayment of tax. Certain persons, including corporations and financial institutions generally, are exempt from backup withholding. Certain penalties apply for failure to furnish correct information and for failure to include the reportable payments in income. Each stockholder should consult with such stockholder's own tax advisor as to such stockholder's qualifications for exemption applies. See Section 3 -- "Procedures from withholding and the procedure for Accepting the Offer and Tendering Shares"obtaining such exemption.

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES. The following is a summary of certain United States federal income tax consequences of the Offer and the Merger to the Company's shareholders United States stockholders of AMPAC whose Shares are tendered and accepted for payment pursuant to the Offer or whose Shares are converted into the right to receive cash in the Merger. It does not address tax consequences applicable to holders of Options, Restricted Stock Awards or Restricted Stock Units. The discussion summary is for general information only and does not purport to consider all aspects of United States federal income taxation that might be relevant to the Company's shareholdersstockholders of AMPAC. The discussion summary is based on current provisions of the Internal Revenue Code of 1986, as amended (the "“Code"”), existing, proposed and temporary regulations promulgated under the Code thereunder and administrative and judicial interpretations of the Codethereof, all of which are subject to change, possibly with a retroactive effect. We have not sought, and do not intend to seek, any ruling from the IRS with respect to the statements made and the conclusions reached in the following summary, and no assurance can be given that the IRS will agree with the views expressed herein, or that a court will not sustain any challenge by the IRS in the event of litigation. The discussion summary applies only to the Company's shareholders United States stockholders of AMPAC in whose hands Shares are capital assets within the meaning of Section 1221 of the Code and who do (generally property held for investment). This summary does not own directly address non-U.S., state or through attribution 50% or more local tax consequences of the Offer or the Merger, nor does it purport to address the United States federal income tax consequences of the transactions to stockholders who will actually or constructively own any stock of Parent. This discussion does not apply AMPAC following the Offer and the Merger, to Shares received pursuant to the exercise holders of employee stock options or otherwise as compensationequity awards under AMPAC’s equity compensation plans, or to special classes of taxpayers (e.g., non-U.S. taxpayers, small business investment companies, regulated investment companies, real estate investment trusts, controlled foreign corporations, passive foreign investment companies, cooperatives, banks and certain types of shareholders (such as other financial institutions, insurance companies, tax-exempt organizations, financial institutions and brokerretirement plans, stockholders that are, or hold Shares through, partnerships or other pass-dealers) who may be subject to special rules. This discussion does not discuss the United States federal income tax consequences to any Company shareholder who, through entities for United States federal income tax purposes, United States persons whose functional currency is a not the United States dollar, dealers in securities or non-resident alien individualU.S. currency, a foreign corporationtraders that mark-to-market their securities, a foreign partnership or a foreign estate or trust, nor does it consider the effect of any foreign, state or local tax laws. Because individual circumstances may differ, each shareholder should consult his or her own tax advisor to determine the applicability expatriates and former long-term residents of the rules discussed below and the particular tax effects of the Offer and the Merger on a beneficial holder of SharesUnited States, including the application and effect of persons subject to the alternative minimum tax, and any statestockholders holding Shares that are part of a straddle, local and foreign tax laws and of changes hedging, constructive sale or conversion transaction, stockholders who received Shares in such laws. The payment for Shares tendered in the Offer or the exchange of Shares for cash compensatory transactions, pursuant to the Merger will be a taxable transaction for exercise of employee stock options, stock purchase rights, or stock appreciation rights, as restricted stock, or otherwise as compensation, and stockholders that beneficially own (actually or constructively), or at some time during the 5-year period ending on the date of the exchange have beneficially owned (actually or constructively), more than 5% of the total fair market value of the Shares). In addition, this summary does not address taxes other than United States federal income tax purposes and likely will be for state, local and foreign income tax purposes as welltaxes. In general, a shareholder who sells This summary assumes that the Shares pursuant to the Offer or receives cash in exchange for Shares pursuant to the Merger will recognize gain or loss for are not United States federal income tax purposes equal to real property interests within the difference, if any, between the amount meaning of cash received and the shareholder's adjusted tax basis in the Shares sold pursuant to the Offer or exchanged for cash pursuant to the Merger. Gain or loss will be determined separately for each block of Shares (i.e., Shares acquired at the same cost in a single transaction) tendered pursuant to the Offer or exchanged for cash pursuant to the Merger. Such gain or loss will be long-term capital gain or loss provided that a shareholder's holding period for such Shares is more than one year at the time of consummation Section 897 of the Offer or the Merger, as the case may be. Capital gains recognized by an individual upon a disposition of Shares that have been held for more than one year generally will be subject to a maximum United States federal income tax rate of 20% or, in the case of Shares that have been held for one year or less, will be subject to tax at ordinary income tax rates. If an individual is subject to the "alternative minimum tax," long-term capital gain can be subjected to a 28% maximum United States federal income tax rate. Certain limitations apply to the use of a shareholder's capital losses. A shareholder whose Shares are purchased in the Offer or exchanged pursuant to the Merger may be subject to 31% backup withholding unless certain information is provided to the Depositary or an exemption applies. See Section 3 -- "Procedures for Accepting the Offer and Tendering Shares"Code.