Common use of Capitalization of the Company Clause in Contracts

Capitalization of the Company. (a) The Company's entire authorized capital stock consists of 70,000,000 shares, of which 65,000,000 shares are classified as Company Common Stock, and 5,000,000 of which are classified as Preferred Stock, par value $.10 per share (the "Preferred Stock"). As of the date hereof, there are no shares of Preferred Stock issued and outstanding, 35,853,545 shares of Company Common Stock issued and outstanding (not including 697,556 shares of Company Common Stock held in the Company's treasury), 4,996,131 shares reserved for issuance in connection with the Company's stock option plans (of which options to purchase 2,902,357 shares are outstanding (the "Company Outstanding Options")); and 2,184,760 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (the "Debentures") outstanding on the date hereof (the "Outstanding Debentures"). Except as set forth above or in the Company Disclosure Schedule, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or any of the Company Subsidiaries convertible into or exchangeable for shares of capital stock or other voting securities of the Company, (iii) no options, warrants or other rights to acquire from the Company or any of the Company Subsidiaries (including any rights issued or issuable under a shareholders rights plan or similar arrangement), and no obligations of the Company or any of the Company Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of the Company Subsidiaries or other similar rights (with the securities listed in clauses (i) through (iv) referred to collectively as the "Corporation's Securities"), and (v) no outstanding obligations of the Company or any of the Company Subsidiaries to repurchase, redeem or otherwise acquire any of the Corporation's Securities or to make any investment (by loan, capital contribution or otherwise) in any other entity. The Company Disclosure Statement sets forth a list of all Company Outstanding Options, including the shares of each holder thereof, which such options are currently vested and which such options will vest as a result of the Merger.

Capitalization of the Company. (a) The Company's entire authorized capital stock consists of 70,000,000 30,000,000 shares, of which 65,000,000 5,000,000 shares are classified as Company Common Stock, and 5,000,000 of which are classified as Preferred Stock, par value $.10 0.01 per share (the "Preferred share, and 25,000,000 shares are classified as Common Stock"). As of the date hereof, there are no shares of Preferred Stock issued and outstanding, 35,853,545 14,509,666 shares of Company Common Stock are issued and outstanding (not including 697,556 272,700 shares of Company Common Stock held in the Company's treasury), 4,996,131 ) and 1,225,634 shares of Common Stock are reserved for issuance in connection with the Company's stock option plans (of which options to purchase 2,902,357 682,875 shares of Common Stock are outstanding (the "Company Outstanding Options")); and 2,184,760 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (the "Debentures") outstanding on the date hereof (the "Outstanding Debentures"). Except as set forth above or in the Company Disclosure Scheduleabove, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or any of the Company Subsidiaries convertible into or exchangeable for shares of capital stock or other voting securities of the Company, (iii) no options, warrants or other rights to acquire from the Company or any of the Company Subsidiaries (including any rights issued or issuable under a shareholders rights plan or similar arrangement), and no obligations of the Company or any of the Company Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of the Company Subsidiaries or other similar rights (with the shares of capital stock, options, warrants, rights, obligations, equity equivalents, and other securities listed in clauses (i) through (iv) referred to collectively as the "Corporation's Securities"), and (v) no outstanding obligations of the Company or any of the Company Subsidiaries to repurchase, redeem or otherwise acquire any of the Corporation's Securities or to make any investment (by loan, capital contribution or otherwise) in any other entity. The (b) All of the outstanding capital stock of, or other ownership interests in, each of the Subsidiaries, is owned by the Company, directly or indirectly, free and clear of any Lien or any other limitation or restriction (including any restriction on the right to vote or sell the same, except as may be provided as a matter of law). For purposes of this Agreement, "Lien" means, with respect to any asset (including, without limitation, any security) any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset. There are no securities of the Company Disclosure Statement sets forth a list or any of all the Subsidiaries convertible into or exchangeable for, no options or other rights to acquire from the Company Outstanding Optionsor any of the Subsidiaries, including and no other contract, understanding, arrangement or obligation (whether or not contingent) providing for the issuance or sale, directly or indirectly, of any capital stock or other ownership interests in, or any other securities of, any of the Subsidiaries. There are no outstanding contractual obligations of the Company or any of the Subsidiaries to repurchase, redeem or otherwise acquire any outstanding shares of each holder thereof, which such options are currently vested capital stock or other ownership interests in any Subsidiary. (c) All issued and which such options will vest as a result outstanding shares of the Merger.capital stock of the Company and each of the Subsidiaries have been duly authorized and validly issued and are fully paid and nonassessable, free of any preemptive rights. The Outstanding Options have been duly authorized and validly issued and are in full force and effect. SECTION 2.4

Capitalization of the Company. (a) The Company's ’s entire authorized share capital stock consists of 70,000,000 28,000,000 shares, of which 65,000,000 5,000,000 shares are classified as Company Common Stockpreference shares, par value U.S.$1.00 per share, and 5,000,000 of which 23,000,000 shares are classified as Preferred Stock, ordinary shares par value $.10 U.S.$1.00 per share (the "Preferred Stock")share. As of the date hereof, there are no preference shares of Preferred Stock issued and outstanding, 35,853,545 8,027,809 ordinary shares of Company Common Stock are issued and outstanding (not including 697,556 1,409,691 ordinary shares of Company Common Stock held in the Company's treasury), 4,996,131 as treasury shares) and 252,140 ordinary shares are reserved for issuance in connection with the Company's ’s stock option plans (of which options to purchase 2,902,357 554,160 ordinary shares are outstanding (the "Company “Outstanding Options"”)); and 2,184,760 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (the "Debentures") outstanding on the date hereof (the "Outstanding Debentures"). Except as set forth above or in the Company Disclosure Scheduleabove, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or any of the Company Subsidiaries convertible into or exchangeable for shares of capital stock or other voting securities of the Company, (iii) no options, warrants or other rights to acquire from the Company or any of the Company Subsidiaries (including any rights issued or issuable under a shareholders members rights plan or similar arrangement), and no obligations of the Company or any of the Company Subsidiaries to issue, any capital stockshares, voting securities or securities convertible into or exchangeable for capital stock shares or voting securities of the Company, (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of the Company Subsidiaries or other similar rights (with the shares, options, warrants, rights, obligations, equity equivalents, and other securities listed in clauses (i) through (iv) referred to collectively as the "Corporation's “Company’s Securities"”), and (v) no outstanding obligations of the Company or any of the Company Subsidiaries to repurchase, redeem or otherwise acquire any of the Corporation's Company’s Securities or to make any investment (by loan, capital contribution or otherwise) in any other entity. The Company Disclosure Statement sets forth a list of all Company Outstanding Options, including the shares of each holder thereof, which such options are currently vested and which such options will vest as a result of the Merger.

Capitalization of the Company. (a) The Company's entire authorized capital stock of the Company consists of: (i) 50,000,000 shares of 70,000,000 shares, Common Stock and (ii) 5,000,000 shares of which 65,000,000 shares are classified as Company Common Preferred Stock, and 5,000,000 (A) 141,450 shares of which are classified designated as shares of Series A Preferred Stock and (B) 180,000 shares of which are designated as shares of Series B Preferred Stock, par value $.10 per share (the "Preferred Stock"). As of the date hereofNovember 1 2004, there are (i) 11,609,099 shares of Common Stock were issued and outstanding and 1,360,573 shares were held in treasury and (ii) no shares of Preferred Stock issued and outstanding, 35,853,545 shares of Company Common Stock were issued and outstanding (not including 697,556 or held in treasury. All of the outstanding shares of Company Common Stock held have been validly issued, and are fully paid, nonassessable and free of preemptive rights. Except as set forth in the Company's treasury), 4,996,131 shares reserved for issuance in connection with the Company's stock option plans (of which options to purchase 2,902,357 shares are outstanding (the "Company Outstanding Options")); and 2,184,760 shares reserved for issuance upon conversion Section 2.9(a) of the Company's 6 1/2% Convertible Debentures (Company Disclosure Schedule, no shares of Common Stock are subject to issuance pursuant to the "Debentures") outstanding Company Stock Plans. Other than as contemplated in this Agreement, since November 1, 2004 no shares of capital stock of the Company have been issued other than pursuant to the exercise of Stock Options set forth on the date hereof (the "Outstanding Debentures")Award List, and no Stock Options or Restricted Shares have been granted. Except as set forth above or in the Company Disclosure Schedulenext succeeding sentence, there are no outstanding (i) no shares of capital stock (including Restricted Shares) or other voting securities of the Company, (ii) no securities of the Company or any of the Company its Subsidiaries convertible into or exchangeable for shares of capital stock or other voting securities of the Company, (iii) no options, warrants options or other rights to acquire from the Company or any of the Company Subsidiaries (including any rights issued its Subsidiaries, or issuable under a shareholders rights plan or similar arrangement), and no obligations of the Company or any of the Company its Subsidiaries to issueissue or sell, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, or (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of the Company Subsidiaries or other similar rights (with the securities listed in clauses (i) through (iv) referred to collectively as the collectively, "Corporation's Company Securities"). Each share of Common Stock carries with it an associated share purchase right (collectively, the "Company Rights") issued pursuant to the Rights Agreement between the Company and KeyCorp. Shareholder Services, Inc. as Rights Agent, dated as of March 27, 1997 (v) as heretofore amended, the "Company Rights Agreement"), which entitles the holder thereof to purchase, on the occurrence of certain events, shares of Series B Preferred Stock or Common Stock. Other than as contemplated by this Agreement, there are no outstanding obligations of the Company or any of the Company its Subsidiaries to repurchase, redeem or otherwise acquire any of the Corporation's Securities or to make any investment (by loan, capital contribution or otherwise) in any other entity. The Company Disclosure Statement sets forth a list of all Company Outstanding Options, including the shares of each holder thereof, which such options are currently vested and which such options will vest as a result of the MergerSecurities.

Capitalization of the Company. (a) The Company's entire authorized capital stock consists of 70,000,000 29,500,000 shares, of which 65,000,000 28,500,000 shares are classified as Company Common Stock, and 5,000,000 1,000,000 of which are classified as Preferred Stock, no par value $.10 per share (the "Preferred Stock"). As of the date hereof, there are no shares of Preferred Stock issued and outstanding, 35,853,545 7,994,402 shares of Company Common Stock issued and outstanding (not including 697,556 shares of Company Common Stock held in the Company's treasury), 4,996,131 and 1,811,721 shares reserved for issuance in connection with the Company's stock option plans (of which options to purchase 2,902,357 315,825, 1,006,375 and 56,250 shares are outstanding under the Company's 1983 Stock Option Plan, 1992 Stock Plan and the Director Warrant Plan, respectively (the "Company Outstanding Options")); and 2,184,760 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (the "Debentures") outstanding on the date hereof (the "Outstanding Debentures"). Except as set forth above or as contemplated in connection with the Company Disclosure ScheduleFinancing (as defined herein) or by Annex B hereto, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or any of the Company Subsidiaries convertible into or exchangeable for shares of capital stock or other voting securities of the Company, (iii) no options, warrants or other rights to acquire from the Company or any of the Company Subsidiaries (including any rights issued or issuable under a shareholders rights plan or similar arrangement), and no obligations of the Company or any of the Company Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of the Company Subsidiaries or other similar rights (with the securities listed in clauses (i) through (iv) referred to collectively as the "Corporation's Securities"), and (v) no outstanding obligations of the Company or any of the Company Subsidiaries to repurchase, redeem or otherwise acquire any of the Corporation's Securities or to make any investment (by loan, capital contribution or otherwise) in any other entity. The Company Disclosure Statement sets forth a list of all Company Outstanding Options, including the shares of each holder thereof, Options and which such options are currently vested and which such options will vest as a result of the Mergervested.

Capitalization of the Company. (a) The Company's entire authorized capital stock consists of 70,000,000 shares, of which 65,000,000 shares are classified as Common Stock, par value $.01 per share (the "Company Common Stock"), and 5,000,000 of which are classified as Preferred Stock, par value $.10 per share (the "Preferred Stock")share. As of the date hereof, there are no shares of Preferred Stock issued and outstanding, 35,853,545 36,239,254 shares of Company Common Stock issued and outstanding (not including 697,556 shares of Company Common Stock held in the Company's treasury), 4,996,131 5,197,787 shares reserved for issuance in connection with the Company's stock option plans (of which options to purchase 2,902,357 3,113,013 shares are outstanding (the "Company Outstanding Options")); and 2,184,760 2,300,000 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (the "Debentures") outstanding on the date hereof (the "Outstanding Debentures"). Except as set forth above or in the Company Disclosure Schedule, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or any of the Company Subsidiaries convertible into or exchangeable for shares of capital stock or other voting securities of the Company, (iii) no options, warrants or other rights to acquire from the Company or any of the Company Subsidiaries (including any rights issued or issuable under a shareholders rights plan or similar arrangement), and no obligations of the Company or any of the Company Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of the Company Subsidiaries or other similar rights (with the securities listed in clauses (i) through (iv) referred to collectively as the "Corporation's Securities"), and (v) no outstanding obligations of the Company or any of the Company Subsidiaries to repurchase, redeem or otherwise acquire any of the Corporation's Securities or to make any investment (by loan, capital contribution or otherwise) in any other entity. The Company Disclosure Statement sets forth a list of all Company Outstanding Options, including the shares of each holder thereof, which such options are currently vested and which such options will vest as a result of the Merger.

Capitalization of the Company. (a) The Company's entire authorized capital stock of the Company consists of 70,000,000 shares10,000,000 Shares of Common Stock and 5,000,000 Shares of Preferred Stock, of which 65,000,000 shares are classified which, as Company of the date hereof, 2,330,136 Shares of Common Stock, and 5,000,000 497,075 Shares of which are classified as Series A Preferred Stock, par value $.10 per share (the "150,000 Shares of Series B Preferred Stock"), 200,000 Shares of Series C Preferred Stock, 249,750 Shares of Series D Preferred Stock and 418,218 Shares of Series E Preferred Stock were issued and outstanding. All of the outstanding Shares have been validly issued and are fully paid and nonassessable and are, other than the Series E Preferred Stock, free of preemptive rights. As of the date hereof, 1,375,000 Shares were reserved for issuance and 447,465 Shares were issuable upon or otherwise deliverable in connection with the exercise of outstanding Company Stock Options issued pursuant to the Company Plans. As of the date hereof, there are no shares were Warrants to purchase 325,000 Shares of Preferred Stock issued common stock outstanding and outstanding, 35,853,545 shares of Company Common Stock issued and outstanding (not including 697,556 shares of Company Common Stock held in the Company's treasury), 4,996,131 shares 325,000 Shares reserved for issuance in connection with the Company's stock option plans (exercise of which options to purchase 2,902,357 shares are outstanding (the "Company Outstanding Options")); and 2,184,760 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (the "Debentures") outstanding on the date hereof (the "Outstanding Debentures")such Warrants. Except as set forth above or in above, as of the Company Disclosure Scheduledate hereof, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or any of the Company Subsidiaries convertible into into, or exchangeable for or exercisable for, shares of capital stock or other voting securities of the Company, (iii) no options, warrants or other rights to acquire from the Company or any of the Company Subsidiaries (including any rights issued or issuable under a shareholders rights plan or similar arrangement), and no obligations of the Company or any of the Company Subsidiaries to issue, issue any capital stock, voting securities or securities convertible into or exchangeable or exercisable for capital stock or voting securities of the Company, and (iv) no equity equivalents, equivalent interests in the ownership or earnings of the Company or any of the Company Subsidiaries or other similar rights (with the securities listed described in the foregoing clauses (i) through (iv) hereafter collectively referred to collectively as the "Corporation's Company Securities"). As of the date hereof, and (v) there are no outstanding rights or obligations of the Company or any of the Company Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities. All Shares, Company Stock Options and Warrants have been issued in compliance with all federal and state (including "blue sky") laws, statutes, regulations and permits. Other than the Litmus Concepts, Inc. Shareholders' Agreement dated as of February 15, 1998, the Fourth Amended and Restated Registration Rights Agreement, dated as of February 25, 1998, and as otherwise contemplated by this Agreement, there are no shareholder agreements, voting trusts, rights agreements or other agreements or understandings to which the Company or its shareholders are parties or by which they are bound relating to the voting or registration of or rights associated with any shares of capital stock or other voting securities of the Corporation's Securities or to make any investment (by loan, capital contribution or otherwise) in any other entityCompany. The holders of Shares of Preferred Stock of the Company are not entitled to and do not have dissenter's rights under Chapter 13 of the CCC. Section 2.2 of the Company Disclosure Statement Schedule sets forth a true and complete list as of the date hereof of all holders of outstanding Company Outstanding Stock Options, including the shares exercise or vesting schedule, the exercise price per share, the term of each holder thereofsuch Company Stock Option, which whether such options are currently vested option is a nonqualified stock option or incentive stock option and which such options will vest any restrictions on exercise or sale of the option or underlying shares. No Company Stock Option shall accelerate solely as a result consequence of the MergerMerger or any of the other transactions contemplated by this Agreement.

Capitalization of the Company. (a) The Company's entire authorized capital stock of the Company consists of 70,000,000 shares, 15,000,000 shares of which 65,000,000 shares are classified as Company Common Stock, and 5,000,000 of which are classified as Preferred Stockcommon stock, par value $.10 0.001 per share (the "Preferred Stock")share, and 5,000,000 shares of preferred stock, par value $0.001 per share, of which 1,000 shares of common stock are issued and outstanding and no shares of preferred stock are issued and outstanding. As No outstanding shares of common stock of the date hereofCompany are subject to any rights of repurchase by the Company. All of the outstanding shares of common stock of the Company have been validly issued and fully paid, nonassessable and free of preemptive rights. Except for the Company Shares, there are no shares of Preferred Stock issued and outstanding, 35,853,545 shares of Company Common Stock issued and not outstanding (not including 697,556 shares of Company Common Stock held in the Company's treasury), 4,996,131 shares reserved for issuance in connection with the Company's stock option plans (of which options to purchase 2,902,357 shares are outstanding (the "Company Outstanding Options")); and 2,184,760 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (the "Debentures") outstanding on the date hereof (the "Outstanding Debentures"). Except as set forth above or in the Company Disclosure Schedule, there are outstanding any (i) no shares of capital stock or other voting securities of the CompanyCompany (including any shares of preferred stock), (ii) no securities of the Company or any of the Company Subsidiaries convertible into into, or exchangeable for or exercisable for, shares of capital stock or other voting securities of the Company, (iii) no options, warrants or other rights to acquire from the Company or any of the Company Subsidiaries (including any rights issued or issuable under a shareholders rights plan or similar arrangement), and no obligations of the Company or any of the Company Subsidiaries to issue, issue any capital stock, voting securities or securities convertible into or exchangeable or exercisable for capital stock or voting securities of the Company, Company or (iv) no equity equivalents, equivalent interests in the ownership or earnings of the Company or any other similar rights. All of the outstanding Company Subsidiaries or other similar rights (Shares were issued in compliance with the securities listed in clauses Securities Act of 1933, as amended (i) through (iv) referred to collectively as the "Corporation's Securities"“Securities Act”), and (v) applicable state securities laws. As of the date hereof, there are no outstanding rights or obligations of the Company or any of the Company Subsidiaries to repurchase, redeem or otherwise acquire any Company Shares. There are no stockholder agreements, voting trusts or other arrangements or understandings to which the Company is a party or by which it is bound, and to its Knowledge there are no other agreements, voting trusts or other arrangements or understandings, relating to the voting or registration of any shares of capital stock or other voting securities of the Corporation's Securities Company or to make any investment (by loanthe issuance of capital stock, capital contribution options, warrants or otherwise) in any other entityrights to any person, including any sales representatives, consultants, contractors, employees, stockholders of the Company or distributors of the Company’s products. The Attached hereto as Section 2.2 of the Disclosure Schedule is a true and complete list as of the date hereof and as of the Closing Date of all holders of outstanding Company Disclosure Statement Shares, which list sets forth a list the names, addresses and primary residences, and the number of all Company Outstanding Options, including Shares held by each Seller. No Company Shares are owned by the shares of each holder thereof, which such options are currently vested and which such options will vest as a result of the MergerCompany.

Capitalization of the Company. (a) The Prior to the filing of the Amended Memorandum and Articles the Company's ’s entire authorized share capital stock consists of 70,000,000 30,000,000 Class A common shares, of which 65,000,000 shares are classified as Company Common Stock, and 5,000,000 of which are classified as Preferred Stock, par value $.10 U.S.$0.01 per share, 2 Class C common shares, par value U.S.$1.00 per share, 7 Class F common shares, par value U.S.$1.00 per share, 1 Class H common share, par value U.S.$1.00 per share (the "Preferred Stock")and 15,000,000 shares of series A convertible preferred shares, par value U.S.$1.00 per share. As of the date hereof, there are no 21,808,290 Class A common shares of Preferred Stock issued and outstanding, 35,853,545 2 Class C common shares of Company Common Stock issued and outstanding, 7 Class F common shares issued and outstanding, 1 Class H common share issued and outstanding (not including 697,556 and no series A convertible preferred shares issued and outstanding. As of Company Common Stock held in the Company's treasury)date hereof, 4,996,131 512,677 Class A common shares are reserved for issuance in connection with the Company's ’s stock option plans (of which options to purchase 2,902,357 512,677 shares are outstanding (each an “Outstanding Option” and collectively, the "Company “Outstanding Options")); and 2,184,760 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (the "Debentures") outstanding on the date hereof (the "Outstanding Debentures"”). Except as set forth above or in the Company Disclosure Scheduleon Schedule 2.4 hereto, there are outstanding (i) no shares of capital stock or other voting securities of the Company, (ii) no securities of the Company or any of the Company Subsidiaries convertible into or exchangeable for shares of capital stock or other voting securities of the Company, (iii) no options, warrants or other rights to acquire from the Company or any of the Company Subsidiaries (including any rights issued or issuable under a shareholders members rights plan or similar arrangement), and no obligations of the Company or any of the Company Subsidiaries to issue, any capital stockshares, voting securities or securities convertible into or exchangeable for capital stock shares or voting securities of the Company, (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of the Company Subsidiaries or other similar rights (with the shares, options, warrants, rights, obligations, equity equivalents, and other securities listed in clauses (i) through (iv) referred to collectively as the "Corporation's “Company’s Securities"”), and (v) no outstanding obligations of the Company or any of the Company Subsidiaries to repurchase, redeem or otherwise acquire any of the Corporation's Company’s Securities or to make any investment (by loan, capital contribution or otherwise) in any other entity. The Company Disclosure Statement sets forth a list of all Company Outstanding Options, including the shares of each holder thereof, which such options are currently vested and which such options will vest as a result of the Merger.

Capitalization of the Company. (a) The Company's entire authorized capital stock of the Company consists of 70,000,000 shares, (i) 50,000,000 shares of which 65,000,000 shares are classified as Company Common Stock, and 5,000,000 of which 7,179,429 shares are classified as Preferred Stock, par value $.10 per share currently issued and outstanding and (the "Preferred Stock"). As of the date hereof, there are no ii) 15,000,000 shares of preferred stock, $.001 par value, of which 3,250 Preferred Stock Shares are currently issued and outstanding, 35,853,545 . All outstanding shares of capital stock of the Company Common Stock issued have been validly issued, and are fully paid, nonassessable and free of preemptive rights. Set forth in SCHEDULE 4.2(A) are all outstanding (not including 697,556 shares options, warrants, or other rights to purchase capital stock of the Company Common Stock held in from the Company's treasury), 4,996,131 shares reserved for issuance in connection with the Company's stock option plans (of which options to purchase 2,902,357 shares are outstanding (the "Company Outstanding Options")); and 2,184,760 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (the "Debentures") outstanding on the date hereof (the "Outstanding Debentures"). Except as set forth above or in the Company Disclosure ScheduleSCHEDULE 4.2(A), there are outstanding (iA) no shares of capital stock or other voting securities of the Company, (iiB) no securities of the Company or any of the Company Subsidiaries convertible into or exchangeable for shares of capital stock or other voting securities of the Company, (iiiC) no options, warrants subscriptions, warrants, convertible securities, calls or other rights to acquire from the Company or any Company, and no obligation of the Company Subsidiaries (including any rights issued or issuable under a shareholders rights plan or similar arrangement), and no obligations of the Company or any of the Company Subsidiaries to issue, deliver or sell, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company, and (ivD) no equity equivalents, performance shares, interests in the ownership or earnings of the Company or any of the Company Subsidiaries or other similar rights issued by the Company (with the securities listed items referred to in clauses (A)-(D) are referred to herein as "COMPANY SECURITIES"). Except as set forth on SCHEDULE 4.2(A) hereto, (i) through (iv) referred to collectively as the "Corporation's Securities"), and (v) there are no outstanding obligations of the Company or any of the Company Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities, (ii) no agreement or other document grants or imposes on any shares of the Corporation's Securities Company Common Stock any right, preference, privilege or restriction with respect to make the transactions contemplated hereby (including without limitation any investment rights of first refusal), other than the right to dissent from the Merger as provided in Section 2.1(e) above and (by loaniii) there are no bonds, capital contribution debentures, notes or otherwiseother indebtedness having general voting rights (or convertible into securities having such rights) in any other entity. The Company Disclosure Statement sets forth a list of all Company Outstanding Options, including the shares of each holder thereof, which such options are currently vested and which such options will vest as a result of the MergerCompany issued and outstanding.

Capitalization of the Company. (a) The Company's entire authorized capital stock of the Company consists of 70,000,000 shares, __________ shares of which 65,000,000 shares are classified as Company Common Stock, and 5,000,000 of which are classified which, as Preferred Stock, par value $.10 per share (the "Preferred Stock"). As of the date hereof, there to the best of Sellers' knowledge, 100,000 shares are outstanding and no shares of Preferred Stock issued and outstanding, 35,853,545 shares of Company Common Stock issued and outstanding (not including 697,556 shares of Company Common Stock are held in the Company's treasury), 4,996,131 . All outstanding shares reserved for issuance in connection with the Company's of capital stock option plans (of which options to purchase 2,902,357 shares are outstanding (the "Company Outstanding Options")); and 2,184,760 shares reserved for issuance upon conversion of the Company's 6 1/2% Convertible Debentures (Company have been validly issued and are fully paid and nonassessable, and no shares of capital stock of the "Debentures") outstanding on the date hereof (the "Outstanding Debentures")Company are subject to, nor have any been issued in violation of, preemptive or similar rights. Except as set forth above or in the Company Disclosure Schedulethis Section, there are (and as of the Closing Date there will be) outstanding (i) no shares of capital stock or other voting securities of the CompanyCompany other than those shares issued to the parties set forth on Exhibit B, (ii) no securities of the Company or any of the Company Subsidiaries convertible into or exchangeable for shares of capital stock or other voting securities of the CompanyCompany other than the Note, (iii) no options, warrants options or other rights to acquire from the Company or any Company, and no obligation of the Company Subsidiaries (including to issue or sell, any rights issued shares of capital stock or issuable under a shareholders rights plan or similar arrangement), and no obligations other voting securities of the Company or any securities of the Company Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for such capital stock or voting securities of the Companysecurities, and (iv) no equity equivalents, interests in the ownership or earnings of the Company or any of the Company Subsidiaries earnings, or other similar rights of or with respect to the Company. There are (with and as of the securities listed in clauses (i) through (iv) referred to collectively as the "Corporation's Securities"), and (vClosing Date there will be) no outstanding obligations of the Company or any of the Company Subsidiaries to repurchase, redeem redeem, or otherwise acquire any of the Corporation's Securities foregoing shares, securities, options, equity equivalents, interests, or rights. No Seller is a party to, or is aware of, any voting agreement, voting trust, or similar agreement or arrangement relating to make any investment (by loan, capital contribution class or otherwise) in any other entity. The Company Disclosure Statement sets forth a list of all Company Outstanding Options, including the shares of each holder thereof, which such options are currently vested and which such options will vest as a result series of the MergerCompany's capital stock.