Common use of Valid Issuance of Capital Stock Clause in Contracts

Valid Issuance of Capital Stock. The Company has an authorized capitalization consisting of 40,000,000 shares of Common Stock, par value $0.10 and 2,000,000 shares of preferred stock, par value $0.10, warrants outstanding for 254,000 shares of Common Stock, and stock options granted to employees as described in the Exchange Act Reports. As of May 8, 1997, the Company has issued and outstanding 26,999,643 shares of Common Stock and, immediately prior to the exchange contemplated hereby, no shares of preferred stock are issued and outstanding. All of the issued shares of Common Stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; the shares of Common Stock issuable upon conversion of the Preferred Stock and the Preferred Stock issuable upon exercise of the Warrant, will be duly and validly issued, fully paid and non-assessable; and the holders of outstanding capital stock of the Company are not and shall not be entitled to preemptive or other rights afforded by the Company to subscribe for the capital stock or other securities of the Company as a result of the issuance of the Securities, except for the rights of first refusal set forth herein and in the other Convertible Securities Exchange Agreements of the Company entered into contemporaneously herewith. The exchange of the Debentures for the Preferred Stock and the Warrant is exempt, and the issuance of the Underlying Stock and Warrant Stock shall be exempt, from the registration requirements of the Securities Act pursuant to Section 3(a)(9) thereof or other applicable exemption. The Certificate of Designation relating to the Preferred Stock has been duly filed with the Secretary of State of the State of Delaware, is in full force and effect and the Holder is entitled to the rights, preferences and privileges set forth therein.

Valid Issuance of Capital Stock. (a) The Company has an authorized capitalization consisting of 40,000,000 100,000,000 shares of Common Stock, par value $0.10 Stock and 2,000,000 1,000,000 shares of preferred stock, par value $0.10, warrants 0.05 per share. The Company has issued and outstanding for 254,000 on the date hereof 48,299,054 shares of Common Stock, of which 20,000 shares are held in treasury, and stock options granted to employees as described in the Exchange Act Reports23,115 shares of Series A Preferred Stock. As of May 8, 1997the date hereof, the Company has issued and outstanding 26,999,643 the following securities convertible into (other than its Series A Preferred Stock) or exercisable or exchangeable for Common Stock (the "DERIVATIVE SECURITIES"): (i) options to purchase 8,204,861 shares of Common Stock andStock; and (ii) other than the Warrants, immediately prior warrants to the exchange contemplated hereby, no purchase 4,726,562 shares of preferred stock are issued and outstanding. Common Stock. (b) All of the issued shares of Common Stock capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; the shares of Common Stock issuable upon . Upon conversion of the Preferred Stock and Shares, in accordance with its terms, the Preferred Stock issuable upon exercise of the Warrant, Conversion Shares will be duly and validly issued, fully paid and non-assessable; nonassessable and free from all taxes, liens and charges with respect to the issuance thereof, with the holders thereof being entitled to all rights accorded to holders of Common Stock. The holders of outstanding shares of capital stock of the Company are not and shall not be entitled to preemptive or other rights afforded by the Company to subscribe for the capital stock or other securities of the Company as a result of the issuance of Conversion Shares upon the Securities, except for the rights of first refusal conversion or exercise thereof. (c) Other than as set forth herein in Section 3.2(a) and options and shares that may be issued pursuant to the Company's stock option plans as in effect on the date hereof: (i) no shares of the Company's capital stock are subject to preemptive rights or any other Convertible Securities Exchange Agreements similar rights or any liens or encumbrances created or imposed by the Company other than issued and outstanding shares of Common Stock held in escrow in connection with the Company's acquisition of each of Catalyst Consulting Services, Inc., Distributed Systems Solutions, Inc. and Big Theory LLC ; (ii) there are no outstanding debt securities issued by the Company which are convertible into Common Stock; (iii) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company entered into contemporaneously herewith. The exchange (or any subsidiary of the Debentures for Company (each hereinafter referred to as a "SUBSIDIARY" and collectively, the Preferred Stock "SUBSIDIARIES"), or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of capital stock of the Company or any Subsidiary or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any Subsidiary other than shares that may be issuable in connection with the acquisition of the Company's subsidiary, Pulse Interactive B.V., based on financial performance; (iv) there are no agreements or arrangements under which the Company (or any Subsidiary) has any outstanding obligation to register the sale of any of their securities under the 1933 Act (except the Registration Rights Agreement, the registration rights agreement among the Company and certain shareholders of Zabit & Associates, Inc., the Subscription Agreement between the Company and Spherion Corporation dated as of April 27, 2000, the Warrant is exemptAgreement between the Company and Spherion Corporation dated as of November 15, 2000, the Warrant issued to Hilton Hotels Corporation dated as of October 6, 2000 and pursuant to certain employee stock option agreements); (v) there are no outstanding securities of the Company or any Subsidiary which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or any Subsidiary; (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Underlying Stock Conversion Shares as described in this Agreement; and Warrant Stock shall be exempt, from (vii) the registration requirements Company does not have any stock appreciation rights or "phantom stock" plans or agreements or any similar plan or agreement. (d) All of the Securities Act pursuant to Section 3(a)(9) thereof authorized shares of capital stock of each Subsidiary are owned by the Company, free and clear of any lien, charge, security interest, encumbrance, adverse claim or other applicable exemption. The Certificate restriction, and all the issued and outstanding shares of Designation relating to the Preferred Stock has been duly filed with the Secretary of State capital stock of the State Subsidiaries are validly issued and are fully paid, non-assessable and free of Delaware, is in full force preemptive and effect and the Holder is entitled to the rights, preferences and privileges set forth therein.similar

Valid Issuance of Capital Stock. (a) The Company has an authorized capitalization consisting of 40,000,000 30,000,000 shares of Common Stock, par value $0.10 .01 per share, and 2,000,000 2,500,000 shares of preferred stock, par value $0.10, warrants .01 per share. The Company has issued and outstanding for 254,000 on the date hereof (i) 5,741,035 shares of Common Stock, none of which shares are held in treasury and stock options granted to employees as described in the Exchange Act Reports(ii) no shares of preferred stock. As of May 8, 1997the date hereof, the Company has issued and outstanding 26,999,643 the following securities convertible into or exercisable or exchangeable for Common Stock (the "Derivative Securities"): warrants to purchase 732,332 shares of Common Stock and, immediately prior and options to purchase 1,548,700 shares of Common Stock. From the date hereof to the exchange Closing, there will be no changes in the authorized capital stock or Derivative Securities, except as contemplated hereby, no shares by this Agreement and except upon the exercise of preferred stock are issued and outstanding. outstanding Derivative Securities. (b) All of the issued shares of Common Stock capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; prior to the Closing Date, the Debentures shall be authorized; the shares of Common Underlying Stock issuable upon conversion of the Preferred Stock Debentures, when issued and delivered in accordance with the Preferred Stock issuable upon exercise terms of the WarrantDebentures, will be duly and validly issuedissued obligations of the Company enforceable against the Company in accordance with their terms, fully paid except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' and non-assessablecontracting parties' rights generally and except as enforceability may be subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding at equity or at law) and shares of Common Stock have been duly reserved for issuance upon the exercise thereof pursuant to the conversion rights set forth in the Debentures; and the holders of outstanding capital stock of the Company are not and shall not be entitled to preemptive or other rights afforded by the Company to subscribe for the capital stock or other securities of the Company as a result of the issuance of the Securities, except for the rights of first refusal set forth herein and in the other Convertible Securities Exchange Agreements of the Company entered into contemporaneously herewith. The exchange of the Debentures for the Preferred Stock and the Warrant is exempt, and the issuance of the Underlying Stock and Warrant Stock shall be exempt, from the registration requirements of the Securities Act pursuant to Section 3(a)(9) thereof or other applicable exemption. The Certificate of Designation relating to the Preferred Stock has been duly filed with the Secretary of State of the State of Delaware, is in full force and effect and the Holder is entitled to the rights, preferences and privileges set forth therein.to

Valid Issuance of Capital Stock. (a) The Company has an authorized capitalization consisting of 40,000,000 60,000,000 shares of Common Stock, par value $0.10 Stock and 2,000,000 shares of preferred stock, par value $0.100.01 per share. The Company has issued and outstanding on December 27, warrants outstanding for 254,000 1999 37,347,527 shares of Common Stock, and stock options granted to employees as described of which no shares are held in the Exchange Act Reportstreasury. As of May 8, 1997the date hereof, the Company has issued and outstanding 26,999,643 the following securities convertible into or exercisable or exchangeable for Common Stock (the "Derivative Securities"): warrants to purchase 1,511,676 shares of Common Stock and, immediately prior and options to purchase 7,504,475 shares of Common Stock. From the date hereof to the exchange Initial Closing, there will be no changes in the authorized capital stock or Derivative Securities, except as contemplated hereby, no shares of preferred stock are issued and outstanding. by this Agreement. (b) All of the issued shares of Common Stock capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; . On or before the shares Initial Closing Date, the authorized capitalization of Common Stock issuable upon conversion of the Company shall include the Preferred Stock and the Warrants; upon issuance, the shares of Preferred Stock issuable upon exercise of the Warrant, will shall be duly (i) validly authorized and validly issued, fully paid and non-assessable; , (ii) free and clear from all taxes, liens and charges with respect to the issuance thereof and (iii) entitled to the rights and preferences set forth in the Certificate. At least 7,000,000 shares of Common Stock (subject to adjustment pursuant to the Company's covenant set forth in Section 5.2 below) have been duly authorized and reserved for issuance upon conversion of the Preferred Stock and exercise of the Warrants. Upon conversion or exercise in accordance with the Certificate or the Warrants, as the case may be, the Underlying Shares will be validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issuance thereof, with the holders being entitled to all rights accorded to a holder of Common Stock and the holders of outstanding capital stock of the Company are not and shall not be entitled to preemptive or other rights afforded by the Company to subscribe for the capital stock or other securities of the Company as a result of the sale of the Preferred Stock, the Warrants or the issuance of Underlying Stock upon the Securities, except for conversion or exercise thereof. The issuance by the rights of first refusal set forth herein and in the other Convertible Securities Exchange Agreements Company of the Company entered into contemporaneously herewithSecurities is exempt from registration under the Securities Act. The exchange issuance by the Company of the Debentures for the Preferred Stock and the Warrant Warrants is exemptbeing made in reliance upon the exemption from registration set forth in Rule 506 of Regulation D under the Securities Act and is only being made to "accredited investors" that meet the requirements of Rule 501(a) of Regulation D and similar exemptions under state law. (c) Other than as set forth in Section 3.4(a), (i) no shares of the Company's capital stock are subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by the Company; (ii) there are no outstanding debt securities issued by the Company; (iii) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any of its Subsidiaries (as defined herein), or contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any of its Subsidiaries; (iv) there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of their securities under the Securities Act (except the Registration Rights Agreement); (v) there are no outstanding securities of the Company or any of its Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any of its Subsidiaries; (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Underlying Stock Securities as described in this Agreement; and Warrant Stock shall be exempt, from (vii) the registration requirements Company does not have any stock appreciation rights or "phantom stock" plans or agreements or any similar plan or agreement. (d) 100% of the Securities Act pursuant to Section 3(a)(9authorized shares of capital stock of each Subsidiary (as defined herein) thereof is owned by the Company (except for directors' qualifying shares or promotional shares), free and clear of any lien, charge, security interest, encumbrance, adverse claim or other applicable exemptionrestriction, and all the issued and outstanding shares of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights. The Certificate of Designation relating There are no outstanding agreements or commitments requiring the Company or any Subsidiary to the Preferred Stock has been duly filed with the Secretary of State of the State of Delaware, is in full force and effect and the Holder is entitled to the rights, preferences and privileges set forth thereinissue capital stock or Derivative Securities.

Valid Issuance of Capital Stock. (a) The Company has an authorized capitalization consisting of 40,000,000 30,000,000 shares of Common Stock, par value $0.10 Stock and 2,000,000 1,000,000 shares of preferred stock, par value $0.10, warrants 0.05 per share. The Company has issued and outstanding for 254,000 on the date hereof 18,693,390 shares of Common Stock, and stock options granted to employees as described of which zero shares are held in the Exchange Act Reportstreasury. As of May 8, 1997the date hereof, the Company has issued and outstanding 26,999,643 the following securities convertible into or exercisable or exchangeable for Common Stock (the "Derivative Securities"): (i) options to purchase 4,999,161 shares of Common Stock and, immediately prior Stock; and (ii) warrants to the exchange contemplated hereby, no purchase 976,562 shares of preferred stock are issued and outstanding. Common Stock. (b) All of the issued shares of Common Stock capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; . On or before the shares Closing Date, the authorized capitalization of Common Stock issuable upon conversion of the Company shall include the Preferred Stock and the Warrants; upon issuance and payment therefor in accordance with the Certificate, the shares of Preferred Stock issuable upon exercise of the Warrant, will shall be duly (i) validly authorized and validly issued, fully paid and non-assessable; , (ii) free and clear from all taxes, liens and charges with respect to the issuance thereof and (iii) entitled to the rights and preferences set forth in the Certificate. The number of shares of Common Stock required hereunder and under the other Transaction Documents to be reserved for issuance upon conversion of the Preferred Stock and exercise of the Warrants (subject to adjustment pursuant to the Company's covenant set forth in Section 5.2 below) have been duly authorized and reserved for issuance. Upon conversion of the Preferred Stock and exercise of the Warrants, in each case, in accordance with the terms thereof, the Underlying Shares will be validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issuance thereof, with the holders thereof being entitled to all rights accorded to holders of Common Stock. The holders of outstanding shares of capital stock of the Company are not and shall not be entitled to preemptive or other rights afforded by the Company to subscribe for the capital stock or other securities of the Company as a result of the sale of the Securities or the issuance of Underlying Shares upon the Securities, except for conversion or exercise thereof. The issuance by the rights Company of first refusal the Securities is exempt from registration under the Securities Act. The issuance by the Company of the Securities is being made in reliance upon the exemption from registration set forth herein in Rule 506 of Regulation D under the Securities Act and is only being made to "accredited investors" that meet the requirements of Rule 501(a) of Regulation D and similar exemptions under state law. (c) Other than as set forth in Section 3.4(a): (i) no shares of the Company's capital stock are subject to preemptive rights or any other Convertible Securities Exchange Agreements similar rights or any liens or encumbrances suffered or permitted by the Company; (ii) there are no outstanding debt securities issued by the Company; (iii) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company entered into contemporaneously herewith. The exchange (or any subsidiary of the Debentures for Company (each hereinafter referred to as a "Subsidiary" and collectively, the Preferred Stock and "Subsidiaries"), or contracts, commitments, understandings or arrangements by which the Warrant Company or any Subsidiary is exemptor may become bound to issue additional shares of capital stock of the Company or any Subsidiary or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any Subsidiary; (iv) there are no agreements or arrangements under which the Company (or any Subsidiary) is obligated to register the sale of any of their securities under the Securities Act (except the Registration Rights Agreement); (v) there are no outstanding securities of the Company or any Subsidiary which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or any Subsidiary; (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Underlying Stock Securities as described in this Agreement; and Warrant Stock shall be exempt, from (vii) the registration requirements Company does not have any stock appreciation rights or "phantom stock" plans or agreements or any similar plan or agreement. (d) All of the Securities Act pursuant to Section 3(a)(9) thereof authorized shares of capital stock of each Subsidiary are owned by the Company, free and clear of any lien, charge, security interest, encumbrance, adverse claim or other applicable exemption. The Certificate restriction, and all the issued and outstanding shares of Designation relating to the Preferred Stock has been duly filed with the Secretary of State capital stock of the State Subsidiaries are validly issued and are fully paid, non-assessable and free of Delaware, is in full force preemptive and effect and the Holder is entitled to the similar rights, preferences and privileges . Except as set forth thereinon Schedule 3.4(d) hereto, there are no outstanding agreements or commitments requiring the Company or any Subsidiary to issue capital stock or Derivative Securities.

Valid Issuance of Capital Stock. (a) The Company has an authorized capitalization consisting of 40,000,000 100,000,000 shares of Common Stock, par value $0.10 Stock and 2,000,000 1,000,000 shares of preferred stock, par value $0.10, warrants 0.05 per share. The Company has issued and outstanding for 254,000 on the date hereof 48,299,054 shares of Common Stock, of which 20,000 shares are held in treasury, and stock options granted to employees as described in the Exchange Act Reports23,115 shares of Series A Preferred Stock. As of May 8, 1997the date hereof, the Company has issued and outstanding 26,999,643 the following securities convertible into (other than its Series A Preferred Stock) or exercisable or exchangeable for Common Stock (the "DERIVATIVE SECURITIES"): (i) options to purchase 8,204,861 shares of Common Stock andStock; and (ii) other than the Warrants, immediately prior warrants to the exchange contemplated hereby, no purchase 4,726,562 shares of preferred stock are issued and outstanding. Common Stock. (b) All of the issued shares of Common Stock capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; the shares of Common Stock issuable upon . Upon conversion of the Preferred Stock and Shares, in accordance with its terms, the Preferred Stock issuable upon exercise of the Warrant, Conversion Shares will be duly and validly issued, fully paid and non-assessable; nonassessable and free from all taxes, liens and charges with respect to the issuance thereof, with the holders thereof being entitled to all rights accorded to holders of Common Stock. The holders of outstanding shares of capital stock of the Company are not and shall not be entitled to preemptive or other rights afforded by the Company to subscribe for the capital stock or other securities of the Company as a result of the issuance of Conversion Shares upon the Securities, except for the rights of first refusal conversion or exercise thereof. (c) Other than as set forth herein in Section 3.2(a) and options and shares that may be issued pursuant to the Company's stock option plans as in effect on the date hereof: (i) no shares of the Company's capital stock are subject to preemptive rights or any other Convertible Securities Exchange Agreements similar rights or any liens or encumbrances created or imposed by the Company other than issued and outstanding shares of Common Stock held in escrow in connections with the Company's acquisition of each of Catalyst Consulting Services, Inc., Distributed Systems Solutions, Inc. and Big Theory LLC; (ii) there are no outstanding debt securities issued by the Company which are convertible into Common Stock; (iii) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company entered into contemporaneously herewith. The exchange (or any subsidiary of the Debentures for Company (each hereinafter referred to as a "SUBSIDIARY" and collectively, the Preferred Stock "SUBSIDIARIES"), or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of capital stock of the Company or any Subsidiary or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any Subsidiary other than shares that may be issuable in connection with the acquisition of the Company's subsidiary, Pulse Interactive B.V., based on financial performance; (iv) there are no agreements or arrangements under which the Company (or any Subsidiary) has any outstanding obligation to register the sale of any of their securities under the 1933 Act (except the Registration Rights Agreement, the registration rights agreement among the Company and certain shareholders of Zabit & Associates, Inc., the Subscription Agreement between the Company and Spherion Corporation dated as of April 27, 2000, the Warrant is exemptAgreement between the Company and Spherion Corporation dated as of November 15, 2000, the Warrant issued to Hilton Hotels Corporation dated as of October 6, 2000 and pursuant to certain employee stock option agreements); (v) there are no outstanding securities of the Company or any Subsidiary which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or any Subsidiary; (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Underlying Stock Conversion Shares as described in this Agreement; and Warrant Stock shall be exempt, from (vii) the registration requirements Company does not have any stock appreciation rights or "phantom stock" plans or agreements or any similar plan or agreement. (d) All of the Securities Act pursuant to Section 3(a)(9) thereof authorized shares of capital stock of each Subsidiary are owned by the Company, free and clear of any lien, charge, security interest, encumbrance, adverse claim or other applicable exemption. The Certificate restriction, and all the issued and outstanding shares of Designation relating to the Preferred Stock has been duly filed with the Secretary of State capital stock of the State Subsidiaries are validly issued and are fully paid, non-assessable and free of Delaware, is in full force preemptive and effect and the Holder is entitled to the similar rights, preferences and privileges . Except as otherwise set forth thereinin this Section 3.3 hereto, there are no outstanding agreements or commitments requiring the Company or any Subsidiary to issue capital stock or Derivative Securities.

Valid Issuance of Capital Stock. (a) The Company has an authorized capitalization consisting of 40,000,000 30,000,000 shares of Common Stock, par value $0.10 .01 per share, and 2,000,000 2,500,000 shares of preferred stock, par value $0.10, warrants .01 per share. The Company has issued and outstanding for 254,000 on the date hereof (i) 5,741,035 shares of Common Stock, none of which shares are held in treasury and stock options granted to employees as described in the Exchange Act Reports(ii) no shares of preferred stock. As of May 8, 1997the date hereof, the Company has issued and outstanding 26,999,643 the following securities convertible into or exercisable or exchangeable for Common Stock (the "Derivative Securities"): warrants to purchase 732,332 shares of Common Stock and, immediately prior and options to purchase 1,548,700 shares of Common Stock. From the date hereof to the exchange Closing, there will be no changes in the authorized capital stock or Derivative Securities, except as contemplated hereby, no shares by this Agreement and except upon the exercise of preferred stock are issued and outstanding. outstanding Derivative Securities. (b) All of the issued shares of Common Stock capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; prior to the Closing Date, the Debentures shall be authorized; the shares of Common Underlying Stock issuable upon conversion of the Preferred Stock Debentures, when issued and delivered in accordance with the Preferred Stock issuable upon exercise terms of the WarrantDebentures, will be duly and validly issued, fully paid obligations of the Company enforceable against the Company in accordance with their terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' and non-assessablecontracting parties' rights generally and except as enforceability may be subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding at equity or at law) and shares of Common Stock have been duly reserved for issuance upon the exercise thereof pursuant to the conversion rights set forth in the Debentures; and the holders of outstanding capital stock of the Company are not and shall not be entitled to preemptive or other rights afforded by the Company to subscribe for the capital stock or other securities of the Company as a result of the sale of the Debentures or the issuance of Underlying Stock upon the Securities, except for the rights of first refusal conversion thereof. Other than as set forth herein in this Section and in the other 500,000 shares of Series A Convertible Securities Exchange Agreements Preferred Stock, par value $.01 per share, previously authorized by the board of directors of the Company entered into contemporaneously herewith(the "Board of Directors"), there are no classes or series of preferred stock authorized, issued or reserved for issuance. There currently are no shares of Series A Preferred Stock, par value $.01 per share, of the Company issued and outstanding. The exchange Company will not issue any shares of its Series A Preferred Stock, par value $.01 per share, for so long as the Debentures for the Preferred Stock and the Warrant is exempt, and the issuance of the Underlying Stock and Warrant Stock shall be exempt, from the registration requirements of the Securities Act pursuant to Section 3(a)(9) thereof or other applicable exemption. The Certificate of Designation relating to the Preferred Stock has been duly filed with the Secretary of State of the State of Delaware, is in full force and effect and the Holder is entitled to the rights, preferences and privileges set forth thereinremain outstanding.

Valid Issuance of Capital Stock. (a) The Company has an authorized capitalization consisting of 40,000,000 100,000,000 shares of Common Stock, par value $0.10 Stock and 2,000,000 1,000,000 shares of preferred stock, par value $0.10, warrants 0.05 per share. The Company has issued and outstanding for 254,000 on the date hereof 48,299,054 shares of Common Stock, of which 20,000 shares are held in treasury, and stock options granted to employees as described in the Exchange Act Reports23,115 shares of Series A Preferred Stock. As of May 8, 1997the date hereof, the Company has issued and outstanding 26,999,643 the following securities convertible into (other than its Series A Preferred Stock) or exercisable or exchangeable for Common Stock (the "DERIVATIVE SECURITIES"): (i) options to purchase 8,204,861 shares of Common Stock andStock; and (ii) other than the Warrants, immediately prior warrants to the exchange contemplated hereby, no purchase 4,726,562 shares of preferred stock are issued and outstanding. Common Stock. (b) All of the issued shares of Common Stock capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; the shares of Common Stock issuable upon . Upon conversion of the Preferred Stock and Shares, in accordance with its terms, the Preferred Stock issuable upon exercise of the Warrant, Conversion Shares will be duly and validly issued, fully paid and non-assessable; nonassessable and free from all taxes, liens and charges with respect to the issuance thereof, with the holders thereof being entitled to all rights accorded to holders of Common Stock. The holders of outstanding shares of capital stock of the Company are not and shall not be entitled to preemptive or other rights afforded by the Company to subscribe for the capital stock or other securities of the Company as a result of the issuance of Conversion Shares upon the Securities, except for the rights of first refusal conversion or exercise thereof. (c) Other than as set forth herein in Section 3.2(a) and options and shares that may be issued pursuant to the Company's stock option plans as in effect on the date hereof: (i) no shares of the Company's capital stock are subject to preemptive rights or any other Convertible Securities Exchange Agreements similar rights or any liens or encumbrances created or imposed by the Company other than issued and outstanding shares of Common Stock held in escrow in connection with the Company's acquisition of each of Catalyst Consulting Services, Inc., Distributed Systems Solutions, Inc. and Big Theory LLC ; (ii) there are no outstanding debt securities issued by the Company which are convertible into Common Stock; (iii) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company entered into contemporaneously herewith. The exchange (or any subsidiary of the Debentures for Company (each hereinafter referred to as a "SUBSIDIARY" and collectively, the Preferred Stock "SUBSIDIARIES"), or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of capital stock of the Company or any Subsidiary or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any Subsidiary other than shares that may be issuable in connection with the acquisition of the Company's subsidiary, Pulse Interactive B.V., based on financial performance; (iv) there are no agreements or arrangements under which the Company (or any Subsidiary) has any outstanding obligation to register the sale of any of their securities under the 1933 Act (except the Registration Rights Agreement, the registration rights agreement among the Company and certain shareholders of Zabit & Associates, Inc., the Subscription Agreement between the Company and Spherion Corporation dated as of April 27, 2000, the Warrant is exemptAgreement between the Company and Spherion Corporation dated as of November 15, 2000, the Warrant issued to Hilton Hotels Corporation dated as of October 6, 2000 and pursuant to certain employee stock option agreements); (v) there are no outstanding securities of the Company or any Subsidiary which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or any Subsidiary; (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Underlying Stock Conversion Shares as described in this Agreement; and Warrant Stock shall be exempt, from (vii) the registration requirements Company does not have any stock appreciation rights or "phantom stock" plans or agreements or any similar plan or agreement. (d) All of the Securities Act pursuant to Section 3(a)(9) thereof authorized shares of capital stock of each Subsidiary are owned by the Company, free and clear of any lien, charge, security interest, encumbrance, adverse claim or other applicable exemption. The Certificate restriction, and all the issued and outstanding shares of Designation relating to the Preferred Stock has been duly filed with the Secretary of State capital stock of the State Subsidiaries are validly issued and are fully paid, non-assessable and free of Delaware, is in full force preemptive and effect and the Holder is entitled to the similar rights, preferences and privileges . Except as otherwise set forth thereinin this Section 3.3 hereto, there are no outstanding agreements or commitments requiring the Company or any Subsidiary to issue capital stock or Derivative Securities.

Valid Issuance of Capital Stock. (a) The Company has an authorized capitalization consisting of 40,000,000 60,000,000 shares of Common Stock, par value $0.10 Stock and 2,000,000 shares of preferred stock, par value $0.100.01 per share. The Company has issued and outstanding on March 7, warrants outstanding for 254,000 2001, 43,021,484 shares of Common Stock, and stock options granted to employees as described of which no shares are held in the Exchange Act Reportstreasury. As of May 8, 1997the date hereof, the Company has issued and outstanding 26,999,643 the following securities convertible into or exercisable or exchangeable for Common Stock (the "Derivative Securities"): warrants to purchase 1,586,123 shares of Common Stock and, immediately prior and options to purchase 9,397,577 shares of Common Stock. From the date hereof to the exchange Initial Closing, there will be no changes in the authorized capital stock or Derivative Securities, except as contemplated hereby, no shares of preferred stock are issued and outstanding. by this Agreement. (b) All of the issued shares of Common Stock capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; . On or before the shares Initial Closing Date, the authorized capitalization of Common Stock issuable upon conversion of the Company shall include the Preferred Stock and the Warrants; upon issuance, the shares of Preferred Stock issuable upon exercise of the Warrant, will shall be duly (i) validly authorized and validly issued, fully paid and non-assessable; , (ii) free and clear from all taxes, liens and charges with respect to the issuance thereof and (iii) entitled to the rights and preferences set forth in the Certificate. At least 5,750,000 shares of Common Stock (subject to adjustment pursuant to the Company's covenant set forth in Section 5.2 below) have been duly authorized and reserved for issuance upon conversion of the Preferred Stock and exercise of the Warrants. Upon conversion or exercise in accordance with the Certificate or the Warrants, as the case may be, the Underlying Shares will be validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issuance thereof, with the holders being entitled to all rights accorded to a holder of Common Stock and the holders of outstanding capital stock of the Company are not and shall not be entitled to preemptive or other rights afforded by the Company to subscribe for the capital stock or other securities of the Company as a result of the sale of the Preferred Stock, the Warrants or the issuance of Underlying Stock upon the Securities, except for conversion or exercise thereof. The issuance by the rights of first refusal set forth herein and in the other Convertible Securities Exchange Agreements Company of the Company entered into contemporaneously herewithSecurities is exempt from registration under the Securities Act. The exchange issuance by the Company of the Debentures for the Preferred Stock and the Warrant Warrants is exemptbeing made in reliance upon the exemption from registration set forth in Rule 506 of Regulation D under the Securities Act and is only being made to "accredited investors" that meet the requirements of Rule 501(a) of Regulation D and similar exemptions under state law. (c) Other than as set forth in Section 3.4(a), (i) no shares of the Company's capital stock are subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by the Company; (ii) there are no outstanding debt securities issued by the Company; (iii) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any of its Subsidiaries (as defined herein), or contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any of its Subsidiaries; (iv) there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of their securities under the Securities Act (except the Registration Rights Agreement); (v) there are no outstanding securities of the Company or any of its Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any of its Subsidiaries; (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the Underlying Stock Securities as described in this Agreement; and Warrant Stock shall be exempt, from (vii) the registration requirements Company does not have any stock appreciation rights or "phantom stock" plans or agreements or any similar plan or agreement. (d) 100% of the Securities Act pursuant to Section 3(a)(9authorized shares of capital stock of each Subsidiary (as defined herein) thereof other than Visual Enterprise, LLC ("VE") is owned by the Company (except for directors' qualifying shares or promotional shares), free and clear of any lien, charge, security interest, encumbrance, adverse claim or other applicable exemptionrestriction, and all the issued and outstanding shares of each Subsidiary other than VE are validly issued and are fully paid, non-assessable and free of preemptive and similar rights. The Certificate of Designation relating There are no outstanding agreements or commitments requiring the Company or any Subsidiary (other than VE) to issue capital stock or Derivative Securities. VE is a limited liability company organized under the Preferred Stock has been duly filed with the Secretary of State laws of the State of Delaware. The Company owns not less than a sixty percent (60%) membership interest in VE. Except for a security interest held by Pacific Business Funding, there is no lien on the Company's membership interests in full force and effect and the Holder is entitled to the rights, preferences and privileges set forth thereinVE.