Common use of Capital Stock and Related Matters Clause in Contracts

Capital Stock and Related Matters. As of the date of this Agreement and immediately thereafter, the authorized capital stock of HI shall consist of (a) 147,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of Common Stock, of which 10,990,924 shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall be reserved for issuance upon exercise of outstanding options and warrants. Except as aforesaid, as of the date of this Agreement, HI shall not have outstanding any stock, investment rights, options, or securities convertible, exercisable, or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock. As of the date of this Agreement, all of the outstanding shares of HI's capital stock shall be validly issued, fully paid, and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3.

Capital Stock and Related Matters. (i) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 90,000,000 undesignated shares, of which 110,000 shares shall be designated as Class M Redeemable Voting Convertible Preferred Stock (of which 110,000 shall be issued and outstanding), 15,000 shares shall be designated as Class T Preferred Stock, Series A (of which 2,176.875 shall be issued and outstanding), 10,000 shares shall be designated as Class T Preferred Stock, Series B (of which 5,363.214 shall be issued and outstanding), 450,000 shares shall be designated as Senior Exchangeable Preferred Stock (of which 177,046 shall be issued and outstanding), 400,000 shares shall be designated as Junior Exchangeable Preferred Stock (of which 140,000 shall be issued and outstanding), 200,000 shares shall be designated as Series A Junior Participating Preferred Stock (of which none shall be issued and outstanding) and 50,000 shares shall be designated as Series B Junior Participating Preferred Stock (of which none shall be issued and outstanding); (b) 200,000,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of Common Stock, of which 10,990,924 10,879,160 shares shall be duly authorized and validly issued and outstanding (before giving effect to the purchase outstanding, 2,075,472 shares shall be reserved for issuance upon conversion of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which 296,297 shares shall be reserved for issuance upon conversion of the Class A T Preferred Stock, 2,833,565 Series A, 2,348,197 shares shall be reserved under the Company's stock option plans (of which options for 1,218,497 shares of Class A Common Stock shall have been granted) and 188,418 shares shall be reserved for issuance under the Company's Employee Stock Purchase Plan; and (c) 10,000,000 shares of Class B Common Stock, of which 888,543 shares shall be issued and outstanding and 197,531 shares shall be reserved for issuance upon conversion of all of the Class B T Preferred Stock, and 5,154,408 of which shall be reserved for issuance upon exercise of outstanding options and warrants. Except as aforesaid, as Series B. As of the date of this AgreementClosing, HI neither the Company nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it they have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Preferred Stock and except as set forth on the attached "CAPITALIZATION SCHEDULE." As of the Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule and except pursuant to the Articles of Incorporation. As of the date of this AgreementClosing, all of the outstanding shares of HIthe Company's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (i) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 5,000,000 shares of Class preferred stock, of which 1,666,667 shares shall be designated as Series A Preferred Stock, all (1,283,785 of which is duly authorized and validly shall be issued and outstanding, (band 382,882 of which shall be reserved for issuance upon the conversion of the Series B Preferred) 200,000 and 382,882 shares of Class shall be designated as Series B Preferred Stock (all of which none will shall be issued and outstanding), and (b) 100,000,000 25,000,000 shares of Common Stock, of which 10,990,924 4,633,000 shares shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which 2,018,182 shares shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all Stock or exercise of the Class B Preferred Stock, and 5,154,408 of which shall be reserved for issuance upon exercise of outstanding options and warrantsWarrant. Except as aforesaid, as As of the date of this AgreementClosing, HI neither the Company nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Preferred Stock and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the date Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of this Agreementits capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule and except pursuant to the Articles of Amendment and the Restated Articles of Incorporation, as amended. As of the Closing, all of the outstanding shares of HIthe Company's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (a) As of the date of this Agreement Initial Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 54,948,353 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of Common Stock, of which 10,990,924 96,790 shares shall be duly authorized designated as Class A Preferred, and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 96,790 of which shall be reserved for issuance upon conversion to the Purchasers pursuant to SECTIONS 1B(b), 1C(b) AND 1D(b) hereof, and of the Class A Preferred Stockwhich 54,851,563 shares shall be designated as Common Stock (16,031,022 of which shall be issued and outstanding, 2,833,565 24,657,082 of which shall be reserved for issuance upon conversion of all of to the Class B Preferred StockPurchasers pursuant to SECTIONS 1B(b), and 5,154,408 1C(b) AND 1D(b) hereof, 13,176,129 of which shall be reserved for issuance issuances to the Executives pursuant to the Senior Management Agreements and 987,328 of which shall be reserved for issuances upon exercise of outstanding options and warrantsgranted by the Company). Except as aforesaid, as As of the date of this AgreementInitial Closing, HI the Company shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stockstock or any stock appreciation rights or phantom stock plans other than pursuant to and as contemplated by this Agreement, the Senior Management Agreements and the Company's Certificate of Incorporation. As of the date Initial Closing, the Company shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except pursuant to this Agreement, the Senior Management Agreements and the Company's Certificate of Incorporation. As of the Initial Closing, all of the outstanding shares of HIthe Company's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. As of the date of this Agreement Closing and --------------------------------- immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 115,000 shares of Preferred Stock, of which 10,000 shares shall be designated as Class A Preferred Stock, (all of which is duly authorized and validly shall be issued and outstanding, (b) 200,000 and 105,000 shares of shall be designated as Class B Preferred Stock Stock, par value $.01 per share (the "Class B Preferred") (70,000 shares of which none will shall be outstanding, issued and (boutstanding and 35,000 shares of which shall be reserved for future issuance pursuant to the Recapitalization Agreement) 100,000,000 and 380,000,000 shares of Common Stock, of which 10,990,924 180,000,000 shares shall be duly authorized designated as Class A Common Stock, par value $.01 per share (the "Class A Common"), 180,000,000 shares shall be designated as Class B Common Stock, par value $.01 per share (the "Class B Common") and validly issued and outstanding 20,000,000 shares shall be designated as Class L Common Stock, par value $.01 per share (before giving effect to the purchase "Class L Common"). As of the Shares and the remainder of the Class B Preferred Stock)Closing, 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which to be sold pursuant to this Agreement shall be reserved for issuance upon conversion of all initially convertible into not less than 6.25% of the Company's Class B Preferred StockL Common and Class A Common, and 5,154,408 before taking into account any shares of which shall be reserved for issuance upon exercise of outstanding options and warrants. Except as aforesaidcommon stock issued or issuable to employees, as officers or directors of the date Company or its Subsidiaries or financing sources. As of this Agreementthe Closing, HI shall except for the Class A Preferred, the Company will not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor nor, except for the Class A Preferred and the shares of stock reserved for grant of stock options to the management of the Company and its Subsidiaries (including any such stock options granted on or prior to the Closing Date), shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans. As of the Closing, except with respect to the Class A Preferred, the Company will not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock. As of the date of this AgreementClosing, all of the outstanding shares of HIthe Company's capital stock shall will be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (i) As of immediately prior to the Closing, the authorized capital stock of the Company consists of 1,000 shares of Class A Common Stock of which 800 shares are issued and outstanding and 1,000 shares of Class B Common Stock of which 480 shares are issued and outstanding. All of such shares of capital stock are held beneficially and of record by the Shareholders (free and clear of all Encumbrances). As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 100,000 shares of Class A Series 1 Senior Preferred Stock, all of which is duly authorized and validly shall be issued and outstanding, (b) 200,000 125,875 shares of Series 2 Senior Preferred Stock, all of which shall be issued and outstanding, (c) 126,625 shares of Series 3 Junior Preferred Stock, all of which shall be issued and outstanding, (d) 6,000,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of A Common Stock, of which 10,990,924 4,563,725.5 shares shall be duly authorized and validly issued and outstanding and (before giving effect to e) 2,000,000 shares of Class B Common Stock of which 186,274.5 shares shall be issued and outstanding. The Capitalization Schedule attached hereto, sets forth ----------------------- the purchase capitalization of each of the Shares Company's Subsidiaries and the remainder name of each Person holding any equity securities of the Class B Preferred Stock)Company, 11,790,324 of which shall be reserved any securities convertible or exchangeable for issuance upon conversion any equity securities of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all Company and any options or other rights to purchase equity securities of the Class B Preferred Stock, Company and 5,154,408 the amount and type of which shall be reserved for issuance upon exercise of outstanding such securities or options and warrants. Except as aforesaid, or rights held by such Persons as of the date Closing Date and immediately thereafter. None of this Agreement, HI shall not have the Company or any of its Subsidiaries has outstanding (1) any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or (2) any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock or similar plans or rights, other than, as of the Closing Date and immediately thereafter, as set forth on the Capitalization Schedule attached ----------------------- hereto. None of the Company or any of its Subsidiaries is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, other than as expressly provided in this Agreement and the Articles of Incorporation. As of the date of this AgreementClosing and immediately thereafter, all of the outstanding shares of HIthe Company's (and each of its Subsidiaries') capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. As of (1) Immediately prior to the date of this Agreement and immediately thereafterClosing, the authorized capital stock of HI the Company shall consist of (a) 147,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 100,000,000.00 shares of Common Stock, of which 10,990,924 2,361,326.16 shares shall be duly authorized and validly issued and outstanding outstanding; (before giving effect to the purchase b) 400,000.00 shares of the Shares Series A Preferred, of which 329,127.50 shares shall be issued and the remainder outstanding, (c) 142,500.00 shares of the Class Series B Preferred Stock)Preferred, 11,790,324 of which 107,880.57 shares shall be issued and outstanding, (d) 7,500.00 shares of Series C Preferred, of which 5,677.92 shares shall be issued and outstanding, (e) 100,000 shares of Series D Preferred, none of which shall be reserved for issuance upon conversion issued and outstanding, (f) 30,000 shares of the Class A Preferred StockSeries E Preferred, 2,833,565 none of which shall be reserved for issuance upon conversion issued and outstanding and (g) 30,000 shares of all of the Class B Preferred StockSeries E-1 Preferred, and 5,154,408 none of which shall be reserved for issuance upon exercise of outstanding options issued and warrantsoutstanding. Except as aforesaid, as The attached Capitalization Schedule sets forth the ownership of the date Company immediately prior to the Closing. As of this Agreementthe Closing, HI the Company shall not have outstanding (or any stock, investment rights, options, commitments to issue) any stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stockstock or any stock appreciation rights or phantom stock plans, except as set forth on the attached Capitalization Schedule or as contemplated by this Agreement or the Exchange Offer. As of the date Closing, the Company shall not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except pursuant to the Executive Stock Agreements and the Investor Rights Agreement or as contemplated by this Agreement, all Agreement or the Exchange Offer. All of the outstanding shares of HIthe Company's capital stock are, and as of the Closing shall be be, validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. As of the date of this Agreement Closing Date and immediately thereafter, the authorized capital stock of HI shall IGI will consist of (ai) 147,000 50,000,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Common Stock of which none will be outstanding, and (b) 100,000,000 9,585,645 shares of Common Stock, of which 10,990,924 shall be duly authorized and validly Stock are issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion 1,907,543 shares of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall be Common Stock have been reserved for issuance upon exercise of outstanding options the Warrants, and warrants(ii) 1,000,000 shares of preferred stock of IGI, $0.01 par value, of which no shares are issued and outstanding. Except as aforesaid, as As of the date of this AgreementClosing Date, HI shall IGI will not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall other than the Warrants and it will not have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock, other than the Warrants and the warrants, options and other securities identified on the "Outstanding Options and Warrants Schedule" attached hereto. As of the Closing Date, IGI will not be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock, except as set forth herein and the Charter Documents as in effect on the date hereof. As of this Agreementthe Closing, all of the outstanding shares of HIIGI's capital stock shall will be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities lawsnonassessable. There are no statutory or contractual stockholder's stockholders' preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writingissuance of the Warrants hereunder. HI IGI has not violated any applicable federal or state securities laws in connection with the offer, sale, sale or issuance of the Sharesany of its capital stock, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, sale and issuance of the Shares Securities hereunder do not require registration under the Securities Act or any applicable state securities laws. All There are no agreements among IGI's stockholders with respect to the rights, preferences, privileges and restrictions voting or transfer of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or IGI's capital stock other changes in vesting provisions or other terms governing such securities than as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3contemplated herein.

Capital Stock and Related Matters. As of the date hereof and as of this Agreement and immediately thereafterthe Closing, (i) the authorized capital stock of HI BCI shall consist of (a) 147,000 20,000 shares of Class A Preferred Stockcommon stock, all par value $10.00 per share, of which is duly authorized and validly 420 shall be issued and outstandingoutstanding and held beneficially and of record by the Sellers in the amounts set forth opposite their respective names on Schedule 4(c) attached hereto, (bii) 200,000 the authorized capital stock of BWI shall consist of 1,000 shares of Class B Preferred Stock common stock, par value $1.00 per share, of which none will 500 shall be outstandingissued and outstanding and held beneficially and of record by the Sellers in the amounts set forth opposite their respective names on Schedule 4(c) attached hereto, and (biii) 100,000,000 the authorized capital stock of PPI shall consist of 1,000 shares of Common Stockcommon stock, par value $1.00 per share, of which 10,990,924 1,000 shall be duly authorized and validly issued and outstanding (before giving effect to and held beneficially and of record by the purchase Sellers in the amounts set forth opposite their respective names on Schedule 4(c) attached hereto. As of the Shares date hereof and the remainder of the Class B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall be reserved for issuance upon exercise of outstanding options and warrants. Except as aforesaid, as of the date of this Agreement, HI Closing: (i) the Companies shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock. As of the date of this Agreement, stock or any stock appreciation rights or phantom stock plans; (ii) all of the outstanding shares of HI's the Companies' capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There nonassessable; (iii) there are no statutory or contractual stockholder's stockholders preemptive rights or rights of first refusal, refusal with respect to the Shares Shares; and (iv) none of the Companies are subject to any option or Underlying Common Stock which obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock. The Companies have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, sale or issuance of any of its capital stock. There are no agreements with respect to the voting or transfer of the Companies' capital stock or among the Sellers with respect to any other aspect of the Companies' affairs. The sale and delivery of the Shares by the Sellers to the Purchasers pursuant to Section 1 hereof, will vest in the Purchasers legal and valid title to the Shares, free and assuming the accuracy clear of the representations and warranties of the Investor set forth in Article 4 hereofall Liens, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act Taxes or any applicable state securities laws. All the rights, preferences, privileges and other restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3any kind.

Capital Stock and Related Matters. (a) As of the date First Closing (except as set forth below with respect to the Series C Preferred as of this Agreement the First Closing and the Second Closing, and immediately thereafter, the authorized capital stock of HI the Issuer shall consist of (a) 147,000 25,000,000 shares of Class A Preferred Stockpreferred stock, all of which is duly authorized and validly (i) 4,500,000 shares have been designated as Series A Cumulative Convertible Preferred Stock (none of which shall be issued and outstandingoutstanding as of each Closing) and (ii) 10,000,000 shares shall be designated as Series B Convertible Preferred Stock (2,806,796 of which shall be issued and outstanding as of each Closing) and (iii) 5,000,000 shares have been designated as Series C Convertible Preferred Stock (2,000,000 of which shall be issued and outstanding as of each Closing and the remainder of which shall be reserved for issuance upon exercising the Series C Warrants), (biv) 200,000 shares of Class B 4,500,000 shall be designated as Series D Convertible Preferred Stock (none of which none will shall be outstandingissued and outstanding as of the First Closing and up to 1,533,333 of which shall be issued and outstanding as of the Second Closing after giving effect to the Closings (including Series D Shares reserved for conversion of a Convertible Bridge Notes dated January 4, 2001 and pursuant to exercise of the Bridge Warrant and (b) 100,000,000 75,000,000 shares of Common Stock, of which 10,990,924 (i) 16,646,399 shares shall be duly authorized and validly issued and outstanding as of each Closing, (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which ii) 10,000,000 shares shall be reserved for issuance upon conversion of the Class A Preferred StockSeries B Shares, 2,833,565 of which (iii) 5,000,000 shares shall be reserved for issuance upon conversion of all of the Class B Preferred StockSeries C Shares, and 5,154,408 of which (iv) 11,391,929 shares shall be reserved for issuance upon exercise of outstanding options stock options, warrants (including the Common Warrants but excluding the securities described in clause (v) below) and warrants. Except as aforesaidconvertible securities, as (v) certain of the date remaining shares are reserved for issuance upon the exercise of this Agreementwarrants issued to Bayview Capital Partners L.P., HI the Convertible Subordinated Promissory Note issued to CEX Holdings, Inc, and the 9% Convertible Subordinated Promissory Note issued to J. Iver & Company, (vi) the issuance of shares of Common Stock to Jack D. Ashabranner II (or a trust solely for his benefit) ix xxxxxxx xx x xxxxx-xpproved settlement of his claim against Corporate Express Delivery Systems, Inc. solely to meet any shortfall in the market value between the 600,000 shares of Common Stock that have been issued for the benefit of Mr. Ashabranner in respect of such settlement and the sum of $000,000, xxxxuant to the terms of such settlement. As of each Closing, neither the Issuer nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stockstock or any stock appreciation rights or phantom stock plans ("Common Stock Equivalents"), except for the Series B Shares, the Series C Shares, the Series D Shares and the Warrants and except as set forth on Schedule 3.02 (a). Schedule 3.02 (a) accurately sets forth the following information with respect to all outstanding Common Stock Equivalents: the holder, the number of shares covered, the exercise price and the expiration date. As of each Closing, neither the date Issuer nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of this Agreementits capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on Schedule 3.02 (a) and except pursuant to the Certificate of Designation. As of each Closing, all of the outstanding shares of HIthe Issuer's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (i) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 500,000 shares of preferred stock, of which (1) 60,000 shares shall be designated as Class A Preferred Stock(of which 30,000 shares shall be issued and outstanding and 30,000 shares shall be reserved for issuance upon conversion of the Class B Preferred), (2) 30,000 shares shall be designated as Class B Preferred (all of which is duly authorized shall be issued and validly outstanding), (3) 75,000 shares shall be designated as Class C Preferred (of which 37,500 shares shall be issued and outstanding and 37,500 shares shall be reserved for issuance upon conversion of the Class D Preferred) and (4) 37,500 shares shall be designated as Class D Preferred (all of which shall be issued and outstanding) and (b) 6,000,000 shares of Common Stock, (x) of which 5,000,000 shares shall be designated as Class A Common (of which (1) 928,073 shares shall be issued and outstanding and held beneficially and of record by the Persons (and in the amounts) set forth on the attached Capitalization -------------- Schedule, (2) 480,000 shares shall be reserved for issuance upon conversion of -------- the Class A Preferred, (3) 24,000 shares shall be reserved for issuance upon exercise of the Class A Warrant, (4) 349,000 shares shall be reserved for issuance upon conversion of the Class C Preferred, (5) 264,000 shares shall be reserved for issuance upon conversion of the Class B Common issued upon conversion of the Class B Preferred and exercise of the Class B Warrant, (6) 174,500 shares shall be reserved for issuance upon conversion of the Class B Common issued upon conversion of the Class D Preferred), (y) 1,000,000 shares shall be designated as Class B Common ((1) 10,670 shares of which shall be issued and outstanding, (b2) 200,000 240,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of Common Stock, of which 10,990,924 shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred StockB Preferred, 2,833,565 (3) 24,000 shares of which shall be reserved for issuance upon the exercise of the Class B Warrant, and (4) 174,500 shares of which shall be reserved for issuance upon conversion of all of the Class B Preferred StockD Preferred), and 5,154,408 of which (z) 187,492 shares shall be reserved for issuance upon the exercise of outstanding options (1) certain common stock warrants issued pursuant to the Private Placement Memorandum and warrants(2) the WSDF Warrants. Except as aforesaid, as As of the date of this AgreementClosing, HI neither the Company nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Preferred Stock, the Class A Preferred Stock, the Class B Preferred Stock, the Class B Common, the Warrants, the WSDF Warrants, the Contingent Warrants and except as set forth on the attached Capitalization Schedule. The attached Capitalization Schedule ----------------------- ----------------------- accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the date Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of this its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the attached Capitalization Schedule and except pursuant to Articles of Organization ----------------------- and the Amended and Restated Stockholders Agreement. As of the Closing, all of the outstanding shares of HIthe Company's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (a) As of the date First Closing (except as set forth below with respect to the Series C Preferred as of this Agreement the First Closing and the Second Closing, and immediately thereafter, the authorized capital stock of HI the Issuer shall consist of (a) 147,000 25,000,000 shares of Class A Preferred Stockpreferred stock, all of which is duly authorized and validly (i) 4,500,000 shares have been designated as Series A Cumulative Convertible Preferred Stock (none of which shall be issued and outstandingoutstanding as of each Closing) and (ii) 10,000,000 shares shall be designated as Series B Convertible Preferred Stock (2,806,797 of which shall be issued and outstanding as of each Closing) and (iii) 5,000,000 shares have been designated as Series C Convertible Preferred Stock (2,000,000 of which shall be issued and outstanding as of each Closing and the remainder of which shall be reserved for issuance upon exercising the Series C Warrants), (biv) 200,000 shares of Class B 3,000,000 shall be designated as Series D Convertible Preferred Stock (none of which none will shall be outstandingissued and outstanding prior to the First Closing and up to ________ of which shall be issued and outstanding as of the Second Closing after giving effect to the Closings (including Series D Shares reserved for conversion of a Convertible Bridge Notes dated January 4, 2001 and pursuant to exercise of the Bridge Warrant and (v) ________ shares have been designated as Series E Convertible Preferred Stock (________ of which shall be issued and outstanding as of each closing) and (b) 100,000,000 75,000,000 shares of Common Stock, of which 10,990,924 (i) 16,646,399 shares shall be duly authorized and validly issued and outstanding as of each Closing, (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which ii) 10,000,000 shares shall be reserved for issuance upon conversion of the Class A Preferred StockSeries B Shares, 2,833,565 of which (iii) 5,000,000 shares shall be reserved for issuance upon conversion of all of the Class B Preferred StockSeries C Shares, and 5,154,408 of which (iv) 12,099,847 shares shall be reserved for issuance upon exercise of outstanding options stock options, warrants (including the Common Warrants but excluding the securities described in clause (v) below) and warrants. Except as aforesaidconvertible securities, as (v) certain of the date remaining shares are reserved for issuance upon the exercise of this Agreementwarrants issued to Bayview Capital Partners L.P., HI the Convertible Subordinated Promissory Note issued to CEX Holdings, Inc, and the 9% Convertible Subordinated Promissory Note issued to J. Iver & Company, (vi) the issuance of shares of Common Stock to Xxxx X. Xxxxxxxxxxx XX (or a trust solely for his benefit) in respect of a court-approved settlement of his claim against Corporate Express Delivery Systems, Inc. solely to meet any shortfall in the market value between the 600,000 shares of Common Stock that have been issued for the benefit of Xx. Xxxxxxxxxxx in respect of such settlement and the sum of $550,000, pursuant to the terms of such settlement. As of each Closing, neither the Issuer nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stockstock or any stock appreciation rights or phantom stock plans ("Common Stock Equivalents"), except for the Series B Shares, the Series C Shares, the Series D Shares, the Series E Shares and the Warrants and except as set forth on Schedule 3.02 (a). Schedule 3.02 (a) accurately sets forth the following information with respect to all outstanding Common Stock Equivalents: the holder, the number of shares covered, the exercise price and the expiration date. As of each Closing, neither the date Issuer nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of this Agreementits capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on Schedule 3.02 (a) and except pursuant to the Certificate of Designation. As of each Closing, all of the outstanding shares of HIthe Issuer's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. As of the date of this Agreement and immediately thereafter, (before giving effect to the purchase of the Shares) the authorized capital stock of HI shall consist of (a) 147,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be 90,000 shares are outstanding, and (bc) 100,000,000 shares of Common Stock, of which 10,990,924 shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock)outstanding, 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall be reserved for issuance upon exercise of outstanding options and warrants. Except as aforesaidaforesaid and except as shown on Schedule 5.3, as of the date of this Agreement, HI shall not have outstanding any stock, investment rights, options, or securities convertible, exercisable, or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock. As of the date of this Agreement, all of the outstanding shares of HI's capital stock shall be validly issued, fully paid, and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3.

Capital Stock and Related Matters. (i) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 500,000 shares of preferred stock, of which 60,000 shares shall be designated as Class A Preferred Stock, (of which 30,000 shares shall be issued and outstanding and 30,000 shares shall be reserved for issuance upon conversion of the Class B Preferred) and 30,000 shares shall be designated as Class B Preferred (all of which is duly authorized and validly shall be issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 5,264,000 shares of Common Stock, of which 10,990,924 5,000,000 shares shall be duly authorized and validly designated as Class A Common (of which 800,714 shares shall be issued and outstanding and held beneficially and of record by the Persons (before giving effect to and in the purchase amounts) set forth on the attached Capitalization Schedule, 480,000 ----------------------- shares shall be reserved for issuance upon conversion of the Shares Class A Preferred, 24,000 shares shall be reserved for issuance upon exercise of the Class A Warrant, and 264,000 shares shall be reserved for issuance upon conversion of the remainder Class B Common issued upon conversion of the Class B Preferred Stock)and exercise of the Class B Warrant) and of which 264,000 shares shall be designated as Class B Common (none of which shares shall be issued and outstanding, 11,790,324 240,000 shares of which shall be reserved for issuance upon conversion of the Class A B Preferred Stock, 2,833,565 and 24,000 shares of which shall be reserved for issuance upon conversion of all the exercise of the Class B Preferred Stock, Warrant) and 5,154,408 of which 9,200 shares shall be reserved for issuance upon the exercise of outstanding options and warrantscertain common stock warrants issued pursuant to the Private Placement Memorandum. Except as aforesaid, as As of the date of this AgreementClosing, HI neither the Company nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Preferred Stock, the Class B Common and the Warrants and except as set forth on the attached Capitalization Schedule. The attached ----------------------- Capitalization Schedule accurately sets forth the following information with ----------------------- respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the date of this AgreementClosing, all of neither the outstanding Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of HI's its capital stock shall be validly issuedor any warrants, fully paidoptions or other rights to acquire its capital stock, except as set forth on the attached Capitalization Schedule and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect except pursuant to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with Certificate of ----------------------- Designation and the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3.Stockholders

Capital Stock and Related Matters. As At the time of the date of Closing ---------------------------------- and after giving effect to the transactions contemplated by this Agreement and immediately thereafterAgreement, the authorized capital stock of HI shall the Company will consist of (a) 147,000 500,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of Common Stockcommon stock, of which 10,990,924 shall 113,228 shares will be duly authorized outstanding and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall 50,000 shares will be reserved for issuance upon exercise of the Warrants. Attached as EXHIBIT A is a --------- true and correct list identifying each stockholder of the Company and the number of shares of Common Stock owned by each such stockholder. All of the outstanding options shares of Common Stock will be validly issued and warrantsoutstanding, fully paid and non-assessable. Except as aforesaidfor the Warrants, as of the date of this Agreement, HI shall not have Company has no outstanding any stock, investment rights, options, or securities convertible, exercisable, convertible into or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock Capital Stock, or containing any profit participation features, nor shall it have outstanding any rights (either preemptive or options other) to subscribe for or to purchase, or any outstanding options for the purchase its capital stock of, or any agreements providing for the issuance (contingent or otherwise) of, or any outstanding calls, commitments or claims of any character relating to, any Capital Stock or any stock or securities convertible into or exchangeable for its capital stock. As any Capital Stock of the date Company. Except as provided in the Warrants, the Company is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its Capital Stock or any convertible securities, rights or options of the type described in the preceding sentence. The Company is not a party to, and does not have knowledge of, any agreement (except as set forth in this Agreement, all the Letter Agreement, the Warrants, the Shareholders' Agreement [as defined in a certain Note and Warrant Purchase Agreement dated December 21, 1990 by and between Purchaser and the Company] and Restricted Stock Award Agreements dated December 21, 1990 between the Company and Xxxxxx XxXxx and the Company and Xxxx Xxxxxxx and the Company) restricting the voting or transfer of any shares of the outstanding shares of HICompany's capital stock shall be validly issuedCapital Stock. The Company is not required to file, fully paidnor has it filed, and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect pursuant to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance Section 12 of the SharesExchange Act, and assuming a registration statement relating to any class of equity securities, provided, however, that --------- -------- under the accuracy Shareholders' Agreement, certain shareholders of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require Company have been granted "piggy-back" registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3.

Capital Stock and Related Matters. As of the date of Closing Date and after giving effect to the transactions contemplated in this Agreement and immediately thereafterAgreement, (i) the Company's authorized capital stock of HI shall will consist of (a) 147,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 3,500,000 shares of Common Stock, par value $.0l per share, of which 10,990,924 shall 823,982 shares will be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall outstanding; 1,000,000 shares will be reserved for issuance upon exercise of the Warrants; and 838,888 shares will be issuable upon exercise of outstanding options Common Stock warrants; (b) 1,100,000 shares of Cumulative Convertible Preferred Stock, par value $.0l per share, of which 1,020,000 shares will be issued and outstanding; 54,931 shares will be issuable upon exercise of outstanding Cumulative Convertible Preferred Stock warrants. Except as aforesaid; and all issued and outstanding shares shall have been duly and validly issued, as fully paid and non-assessable; (ii) the Warrants, if exercised in full, would represent approximately 27% of the date Company's outstanding Common Stock on a fully diluted basis; (iii) no shares of this Agreement, HI shall not Common Stock will be owned or held by or for the account of the Company or any of its Subsidiaries; (iv) neither the Company nor any of its Subsidiaries will have outstanding any stock, investment rights, options, stock or other securities convertible, exercisable, convertible into or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation featuresstock, nor shall it have outstanding any rights or options to subscribe for or to purchase its or, options for the purchase of, or any agreements providing for the issuance (contingent or otherwise) of, or any calls, commitments or claims of any other character relating to the issuance of, any capital stock stock, or any stock or securities convertible into or exchangeable for its capital stock. As of the date of this Agreement, all of the outstanding shares of HI's any capital stock shall be validly issued, fully paid, and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing(other than the Notes and the Warrants and except as set forth on Schedule 11C hereto); (v) except as contemplated hereby neither the Company nor any of its Subsidiaries will be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of capital stock; and (vi) the Company will not have filed or be required to file, pursuant to Section 12 of the 1934 Act a registration statement relating to any class of debt or equity securities. HI has not violated Except as contemplated by this Agreement and as disclosed by the Company on Schedule 11C, there are no agreements, written or oral, between the Company and any applicable federal or state securities laws in connection with the offer, saleholder of its capital stock, or issuance to the best knowledge of the SharesCompany, and assuming the accuracy among any holder of its capital stock relating to ownership or voting of the representations and warranties capital stock of the Investor Company. 11D. Actions Pending. Except as set forth in Article 4 hereofSchedule 11D, there is no action, suit, investigation or proceeding pending or, to the offer, sale, and issuance knowledge of the Shares hereunder do not require registration under Company, threatened against the Securities Act Company or any applicable state securities laws. All the of its Subsidiaries or any of their properties or rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities by or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3.before any court,

Capital Stock and Related Matters. (i) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 10,000,000 shares of Class preferred stock, of which 2,000 shares shall be designated as Series A Preferred Stock, all (the "Series A Preferred") (of which is duly authorized and validly 2,000 shares shall be issued and outstanding, (b) 200,000 and 5,000,000 shares of Class shall be designated as Series B Preferred Stock (of which none will 823,455 shares shall be issued and outstanding, ) and (b) 100,000,000 40,000,000 shares of Common Stock, of which 10,990,924 10,000,000 shares shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which 2,500,000 shares shall be reserved for issuance upon conversion of the Class Series A Preferred Stock, 2,833,565 of which and 5,000,000 shares shall be reserved for issuance upon conversion of all the Series B Preferred or exercise of the Class B Preferred Stock, and 5,154,408 of which shall be reserved for issuance upon exercise of outstanding options and warrantsWarrant. Except as aforesaid, as As of the date of this AgreementClosing, HI neither the Company nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Series B Preferred and the Warrant and except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the date Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of this Agreementits capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the Closing, all of the outstanding shares of HIthe Company's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. As of the date of this Agreement and immediately thereafterhereof, the authorized capital stock of HI shall consist the Parent consists of (ai) 147,000 10,000,000 shares of the Parent Class A Common Stock, of which 2,491,610 shares are issued and outstanding, and 200,000 shares of the Parent Class B Common Stock, of which no shares are issued and outstanding, (ii) 1,750,000 shares of the Parent Preferred Stock, all 1,600,000 of which is has been designated as Series A Preferred Stock of the Parent with 1,482,423 shares of such Series A Preferred Stock issued and outstanding, and 150,000 of which has been designated as Series B Preferred Stock of the Parent with 149,002 shares of such Series B Preferred Stock issued and outstanding, and (iii) 50,000 shares of Undesignated Stock. After the date hereof and prior to the Closing the Parent may (i) authorize additional amounts or classes of capital stock, and (ii) issue additional shares of Parent Common Stock and/or Parent Preferred Stock to one or more of its Affiliates. The outstanding shares of the Parent Stock have been duly authorized and validly issued and are fully paid and nonassessable and were issued in compliance with all applicable federal and state securities laws. As of the date hereof, except as set forth above or on Schedule 6.5 of the Parent Disclosure Schedule, (i) no shares of capital stock of the Parent are outstanding, (bii) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of Common Stock, of which 10,990,924 shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall be reserved for issuance upon exercise of outstanding options and warrants. Except as aforesaid, as of the date of this Agreement, HI shall Parent does not have outstanding any stock, investment rights, options, or securities convertible, exercisable, convertible into or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation featuresstock, nor shall it have outstanding any rights or options to subscribe for or to purchase its or any options for the purchase of, or any agreements providing for the issuance (contingent or otherwise) of, or any calls, commitments or claims of any other character relating to the issuance of, any capital stock stock, or any stock or securities convertible into or exchangeable for its any capital stock, and (iii) the Parent is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire or to register under the Securities Act, any shares of capital stock. As The Parent does not have outstanding any bonds, debentures, notes or other obligations the holders of which have the right to vote (or convertible into or exercisable for securities having the right to vote) with the stockholders of the date of this Agreement, all of the outstanding shares of HI's capital stock shall be validly issued, fully paid, and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated Parent on any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3matter.

Capital Stock and Related Matters. As of the date of this Agreement Closing Date, and immediately thereafterafter --------------------------------- giving effect to the transactions contemplated hereby and pursuant to the Related Documents, (i) the authorized capital stock of HI shall the Company will consist of a total of 101,000,000 shares as follows: (a) 147,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of Common Stock, of which 10,990,924 shall be duly authorized and validly 19,229,577 shares are issued and outstanding (before after giving effect to the closing under the Securities Purchase Agreement, the ownership and the consideration paid for which is set forth on Schedule 8C and (1) 4,383,333 shares of which are reserved for the exercise of options or warrants to purchase such shares issued or issuable to officers, directors, consultants, independent contractors and employees of the Shares Company and its Subsidiaries and other providers of services to the remainder of the Class B Preferred Stock), 11,790,324 Company and its Subsidiaries and (2) 2,715,000 shares of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall be are reserved for issuance upon exercise of the Warrants and other warrants, after giving effect to the Closing; and (b) 1,000,000 shares of preferred stock, par value $.01, of which 5,000 shares are designated Series A Preferred Stock, all of which are issued and outstanding options and warrants. Except as aforesaid, as of the date Closing Date after giving effect to the Closing; (ii) all issued and outstanding shares shall have been duly and validly issued, fully paid and non-assessable; (iii) no shares of this Agreementcapital stock of the Company will be owned or held by or for the account of the Company or any of its Subsidiaries; (iv) except as set forth on Schedule 8C, HI shall not neither the Company nor any of its Subsidiaries will have outstanding any stock, investment rights, options, or securities convertible, exercisable, convertible into or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights (either preemptive or options other) to subscribe for or to purchase, or any options for the purchase its of, or any agreements providing for the issuance (contingent or otherwise) of, or any calls, commitments or claims of any other character relating to the issuance of, any capital stock stock, or any stock or securities convertible into or exchangeable for any capital stock; (v) except as set forth on Schedule 8C, neither the Company nor any of its Subsidiaries will be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or warrants or options to purchase shares of its capital stock. As ; (vi) except as set forth on Schedule 8C, neither the Company nor any of its Subsidiaries is a party to any agreement (other than this Agreement, the Securities Purchase Agreement and the Securityholders Agreement) restricting the transfer of any shares of its capital stock; and (vii) neither the Company nor any of its Subsidiaries will have filed or be required to file, pursuant to Section 12 of the Exchange Act, a registration statement relating to any class of debt or equity securities as of the date hereof. Upon the Closing, and after giving effect the issuance of this Agreement, all 2,500,000 Warrant Shares upon exercise of the outstanding shares of HI's capital stock shall be validly issuedWarrants, fully paid, and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the such Warrant Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance will constitute 10.41% of the Fully Diluted Outstanding Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3.

Capital Stock and Related Matters. As of the date of this Agreement and immediately thereafterSchedule 3.5 sets forth, for each Acquired Entity, the authorized authorized, issued and outstanding capital stock of HI shall consist each Acquired Entity which is a corporation, membership interests of (a) 147,000 shares each Acquired Entity which is a limited liability company and limited and general partnership interests of Class A Preferred Stockeach Acquired Entity which is a limited partnership, all of which is issued and outstanding capital stock, membership interests or partnership interests, as the case may be, are owned, beneficially and of record, by an Acquired Entity or a Seller, as listed on Schedule 3.5, free and clear of any Liens other than such as may be created by or on behalf of the Buyers and other than the Wisconsin Debt, and have been duly authorized and validly issued and outstandingare fully paid, (b) 200,000 shares nonassessable and were not issued in violation of Class B Preferred Stock any preemptive rights, rights of which none will be outstanding, and (b) 100,000,000 shares of Common Stock, of which 10,990,924 shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall be reserved for issuance upon exercise of outstanding options and warrantsfirst refusal or any similar rights. Except as aforesaidlisted on Schedule 3.5, as there are no outstanding obligations, warrants, options or other rights to subscribe for or purchase from any Acquired Entity, or other contracts or commitments providing for the issuance of or granting any Person the date right to acquire, shares of this Agreement, HI shall not have outstanding any class of capital stock, investment rights, optionsmembership interests or partnership interests of any Acquired Entity, or any securities convertibleor other instruments convertible into or exchangeable or exercisable for shares of any class of capital stock, exercisablemembership interests or partnership interests of any Acquired Entity, and no Acquired Entity is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire, or exchangeable for (or any agreements to register under which HI is or may become obligated to issuethe Securities Act, sell, or transfer) any shares of its capital stock stock, membership interests or containing any profit participation featurespartnership interests, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock. As of as the date of this Agreement, all of the outstanding shares of HI's capital stock shall be validly issued, fully paid, and nonassessable and were issued in compliance with all applicable state and federal securities lawscase may be. There are no statutory proxies, voting agreements or contractual stockholder's preemptive rights or rights of first refusal, other agreements with respect to the Shares voting or Underlying Common Stock which have not been effectively waived in writing. HI has not violated transfer of any applicable federal shares of capital stock or state securities laws in connection with the offer, sale, or issuance membership interests of any of the SharesAcquired Entities. At Closing, the Buyers shall have good and valid title to all of the capital stock, membership interests and partnership interests of the Acquired Entities, free and clear of any Liens, and assuming the accuracy Acquired Entities shall have good and valid title to all of the representations capital stock, membership interests and warranties partnership interests of the Investor set forth in Article 4 hereofSubject Companies that are not Acquired Entities, the offerfree and clear of any Liens, sale, and issuance other than such as may be created by or on behalf of the Shares hereunder do not require registration under Buyers and other than the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3Wisconsin Debt.

Capital Stock and Related Matters. As of the date of this Agreement and immediately thereafterhereof, the authorized capital stock of HI shall consist the Company consists of thirty million (a30,000,000) 147,000 shares of Class Company Common Stock, of which 5,173,679 shares are issued and outstanding, fifteen million (15,000,000) shares of no par value preferred stock, three million six hundred thousand (3,600,000) shares of which are designated as Company Series A Preferred Stock, all of which is are issued and outstanding and six million five hundred seventy-six thousand five hundred seventy-seven (6,576,577) shares of which are designated as Company Series B Preferred Stock, all of which are issued and outstanding. Schedule 5.6 of the Company Disclosure Schedule sets forth the names of the record owners of the Company Common Stock and Company Preferred Stock and the number of shares held by each such owner. The outstanding shares of Company Common Stock and Company Preferred Stock (i) have been duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, are fully paid and nonassessable and (bii) 100,000,000 shares of Common Stock, of which 10,990,924 shall be duly authorized were issued in compliance with all applicable federal and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which shall be reserved for issuance upon exercise of outstanding options and warrantsstate securities laws. Except as aforesaidset forth above, as referenced in the last sentence of this Section 5.6 or set forth on Schedule 5.6 of the date Company Disclosure Schedule, no shares of this Agreement, HI shall capital stock of the Company are outstanding; the Company does not have outstanding any stock, investment rights, options, or securities convertible, exercisable, convertible into or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation featuresstock, nor shall it have outstanding any rights or options to subscribe for or to purchase its or any options for the purchase of, or any agreements providing for the issuance (contingent or otherwise) of, or any calls, commitments or claims of any other character relating to the issuance of, any capital stock stock, or any stock or securities convertible into or exchangeable for its any capital stock; and the Company is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire, or to register under the Securities Act, any shares of capital stock. All outstanding securities set forth on Schedule 5.6 of the Company Disclosure Schedule have been validly issued by the Company, are fully paid and nonassessable and upon conversion to their underlying security will be validly issued, fully paid and nonassessable. The Company does not have outstanding any bonds, debentures, notes or other obligations the holders of which have the right to vote (or convertible into or exercisable for securities having the right to vote) with the shareholders of the Company on any matter. No consent of holders of any Company Options or Company Warrants or of participants in any stock option plan, stock incentive plan or any other similar plan sponsored by the Company is required to allow for the treatment of Company Options and Company Warrants as provided in Section 4.2. All actions, if any, required with respect to Company Options, Company Warrants and such option, stock incentive and similar plans to allow for the treatment of Company Options and Company Warrants as is provided in Section 4.2, have been, or prior to the Closing will be, validly taken. As of the date of this Agreement, all of the outstanding shares of HI's capital stock shall be validly issued, fully paid, hereof there are 16,091,967 Fully Diluted Shares (including 717,711 Vested Options) and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3864,048 Excluded Options.

Capital Stock and Related Matters. (a) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Issuer shall consist of (a) 147,000 25,000,000 shares of Class A Preferred Stockpreferred stock, all of which is duly authorized and validly (i) 4,500,000 shares have been designated as Series A Cumulative Convertible Preferred Stock (none of which shall be issued and outstanding, outstanding as of the Closing) and (bii) 200,000 10,000,000 shares of Class shall be designated as Series B Convertible Preferred Stock (2,806,796 of which none will shall be outstanding, issued and outstanding as of the Closing and the remainder of which shall be reserved for issuance upon exercising the Additional Warrants and the Preferred Warrants) and (b) 100,000,000 75,000,000 shares of Common Stock, of which 10,990,924 (i) 16,298,760 shares shall be duly authorized and validly issued and outstanding (before giving effect to the purchase as of the Shares and the remainder of the Class B Preferred Stock)Closing, 11,790,324 of which (ii) 10,000,000 shares shall be reserved for issuance upon conversion of the Class A Preferred StockSeries B Shares, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, and 5,154,408 of which (iii) 5,515,835 shares shall be reserved for issuance upon exercise of outstanding options stock options, warrants (including the Common Warrants but excluding the securities described in clause (iv) below) and warrants. Except as aforesaid, as convertible securities and (iv) certain of the date remaining shares are reserved for issuance upon the exercise the warrants issued to Bayview Capital Partners L.P., the Convertible Subordinated Promissory Note issued to CEX Holdings, Inc, and the 9% Convertible Subordinated Promissory Note issued to J. Iver & Company. As of this Agreementthe Closing, HI neither the Issuer nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stockstock or any stock appreciation rights or phantom stock plans ("Common Stock Equivalents"), except for the Series B Shares and the Warrants and except as set forth on the attached Capitalization Schedule (a). Capitalization Schedule (a) accurately sets forth the following information with respect to all outstanding Common Stock Equivalents: the holder, the number of shares covered, the exercise price and the expiration date. As of the date Closing, neither the Issuer nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of this Agreementits capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule (a) and except pursuant to the Certificate of Designation. As of the Closing, all of the outstanding shares of HIthe Issuer's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (i) As of the date of this Agreement and immediately thereafterhereof, the authorized capital stock of HI the Company consists of 30,000,000 shares of Common Stock, of which 11,060,000 shares are issued and outstanding and are held beneficially and of record by the Sellers as set forth on the CAPITALIZATION SCHEDULE attached hereto (free and clear of all Encumbrances) and of which 5,200,000 shares are reserved for issuance upon exercise of stock options authorized pursuant to the Stock Option Plans. As of the Closing and immediately thereafter (and after giving effect to the issuance of the Preferred Stock), the authorized capital stock of the Company shall consist of (a) 147,000 482,684 shares of Class A Redeemable Preferred Stock, all of which is duly authorized and validly shall be issued and outstanding, (b) 200,000 22,790,000 shares of Class B Convertible Preferred Stock Stock, of which none will 22,785,424 shall be outstanding, issued and outstanding and (bc) 100,000,000 50,000,000 shares of Common Stock, of which 10,990,924 2,212,000 shares shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which 22,790,000 shares shall be reserved for issuance upon conversion of the Class A Convertible Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all of the Class B Preferred Stock, Stock and 5,154,408 of which 6,268,397 shares shall be reserved for issuance upon exercise of outstanding stock options and warrantsauthorized pursuant to the Stock Option Plans. Except as aforesaidset forth in the immediately preceding sentence or on the CAPITALIZATION SCHEDULE, the Company does not have and as of the date of this Agreement, HI shall Closing Date will not have outstanding any stockany, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, other than, as of the Closing Date, any options granted pursuant to the Stock Option Plans as of the Closing Date. The Company is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, other than as expressly provided in or contemplated by this Agreement and, as of the Closing, pursuant to the Articles of Incorporation and the Shareholders Agreement. As of the date hereof and as of this Agreementthe Closing and immediately thereafter, all of the outstanding shares of HIthe Company's capital stock are or shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (i) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 50,000,000 shares of Class preferred stock, of which (1) 815,000 shares shall be designated Series A Preferred, of which 815,000 shares of such Series A Preferred Stockshall be issued and outstanding, all (2) 5,000,000 shares shall be Series B Preferred of which is duly authorized 1,130,667 shares of such Series B Preferred shall be issued and validly outstanding, (3) 3,000,000 shares shall be Series C Preferred of which 760,256 shares of such Series C Preferred shall be issued and outstanding and (4) 1,052,632 shares shall be Series D Preferred of which 1,052,632 shares of such Series D Preferred shall be issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 25,000,000 shares of Common Stock, of which 10,990,924 3,290,040 shares shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which 3,758,555 shares shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all Stock and exercise of the Class B Preferred StockWarrant, and 5,154,408 (c) options to acquire 906,750 shares of which shall be reserved for issuance upon exercise of outstanding options and warrants. Except Common Stock issued pursuant to the Company's Tandem Stock Option Plan dated March l, 1993 attached hereto as aforesaid, as Exhibit H. As of the date of this AgreementClosing, HI neither the Company nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except for the Preferred Stock and the Warrant and except as set forth on the Capitalization Schedule attached hereto. The Capitalization Schedule accurately sets forth the following information with respect to all outstanding stock, and options and rights to acquire the Company's capital stock: the holder, the number of shares owned or covered, any applicable exercise price and any applicable expiration date (or, in lieu of the expiration date, any applicable grant date and the exercise term). As of the date Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule and except pursuant to the Certificate of Determination and this Agreement. As of the Closing, all of the outstanding shares of HIthe Company's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (i) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI ATS shall consist of (a) 147,000 25,000,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of ATS Common Stock, of which 10,990,924 8,623,587 shares shall be duly issued and outstanding, 3,111,111 shares shall be issued as the Additional Shares and 950,000 shares shall be reserved for issuance upon exercise of the Warrant. As of the Closing and immediately thereafter, the authorized and validly capital stock of STS shall consist of 35,000,000 shares of STS Common Stock, of which 4,500,000 shares shall be issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which 25,500,000 shares shall be reserved for issuance upon conversion of the Class A Preferred StockNotes, 2,833,565 and 100,000 shares of preferred stock, none of which shall be reserved for issuance upon conversion of all issued and outstanding. As of the Class B Preferred StockClosing, and 5,154,408 of which neither ATS nor STS nor any Subsidiary shall be reserved for issuance upon exercise of outstanding options and warrants. Except as aforesaid, as of the date of this Agreement, HI shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stockstock or any stock appreciation rights or phantom stock plans, except for the Note and the Warrant and as set forth on the attached Capitalization Schedule. As of the date Closing, neither ATS nor STS nor any ----------------------- Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of this Agreementits capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule. As of the Closing, all ----------------------- of the outstanding shares of HIATS's and STS's capital stock (including, without limitation, the Additional Shares) shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (a) As of the date First Closing (except as set forth below with respect to the Series C Preferred as of this Agreement the First Closing and the Second Closing, and immediately thereafter, the authorized capital stock of HI the Issuer shall consist of (a) 147,000 25,000,000 shares of Class A Preferred Stockpreferred stock, all of which is duly authorized and validly (i) 4,500,000 shares have been designated as Series A Cumulative Convertible Preferred Stock (none of which shall be issued and outstandingoutstanding as of each Closing) and (ii) 10,000,000 shares shall be designated as Series B Convertible Preferred Stock (2,806,796 of which shall be issued and outstanding as of each Closing) and (iii) 5,000,000 shares shall be designated as Series C Convertible Preferred Stock (833,333 of which shall be issued and outstanding as of the First Closing and 2,000,000 of which shall be issued and outstanding as of the Second Closing and the remainder of which shall be reserved for issuance upon exercising the Series C Warrants), (bc) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 75,000,000 shares of Common Stock, of which 10,990,924 (i) 16,622,029 shares shall be duly authorized and validly issued and outstanding as of each Closing, (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which ii) 10,000,000 shares shall be reserved for issuance upon conversion of the Class A Preferred StockSeries B Shares, 2,833,565 of which (iii) 5,000,000 shares shall be reserved for issuance upon conversion of all of the Class B Preferred StockSeries C Shares, and 5,154,408 of which (iv) 8,462,440 shares shall be reserved for issuance upon exercise of outstanding options stock options, warrants (including the Common Warrants but excluding the securities described in clause (v) below) and warrants. Except as aforesaid, as convertible securities and (v) certain of the date remaining shares are reserved for issuance upon the exercise the warrants issued to Bayview Capital Partners L.P., the Convertible Subordinated Promissory Note issued to CEX Holdings, Inc, and the 9% Convertible Subordinated Promissory Note issued to J. Iver & Company. As of this Agreementeach Closing, HI neither the Issuer nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stockstock or any stock appreciation rights or phantom stock plans ("Common Stock Equivalents"), except for the Series B Shares, the Series C Shares, the Preferred Warrants (until the Second Closing) and the Warrants and except as set forth on the attached Capitalization Schedule (a). Capitalization Schedule (a) accurately sets forth the following information with respect to all outstanding Common Stock Equivalents: the holder, the number of shares covered, the exercise price and the expiration date. As of each Closing, neither the date Issuer nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of this Agreementits capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule (a) and except pursuant to the Certificate of Designation. As of each Closing, all of the outstanding shares of HIthe Issuer's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (i) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 500,000 shares of preferred stock, of which 18,125 shares shall be designated as Class A Preferred (all of which shall be issued and outstanding), (b) 9,000,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of Common StockCommon, of which 10,990,924 110,410 shares shall be duly authorized and validly issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class B Preferred Stock), 11,790,324 of which 33,340 shares shall be reserved for issuance upon conversion of the Class A Preferred Stock, 2,833,565 of which shall be reserved for issuance upon conversion of all exchange of the Class B Preferred Stock, Common issued hereunder and 5,154,408 issuable upon exchange of which the Warrants and 1,250 shares shall be reserved for issuance upon exercise of the Warrants, (c) 500,000 shares of Class B Common, of which 27,090 shares shall be issued and outstanding options and warrants5,000 shares shall be reserved for issuance upon exercise of the Warrants. Except as aforesaid, set forth on the "Capitalization Schedule," as of the date of this AgreementClosing, HI neither the Company nor any Subsidiary shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stockstock or any stock appreciation rights or phantom stock plans, except for the Class B Common and the Warrants. As of the date Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any warrants, options or other rights to acquire its capital stock, except pursuant to this Agreement, the Certificate of Incorporation, the Executive Stock Agreements and the Borrowing Agreement. As of the Closing, all of the outstanding shares of HIthe Company's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.

Capital Stock and Related Matters. (i) As of the date of this Agreement Closing and immediately thereafter, the authorized capital stock of HI the Company shall consist of (a) 147,000 50,000,000 shares of Class A Preferred Stock, all of which is duly authorized and validly issued and outstanding, (b) 200,000 shares of Class B Preferred Stock of which none will be outstanding, and (b) 100,000,000 shares of Voting Common Stock, of which 10,990,924 shall 15,548,692.4204 shares will be duly authorized issued and validly outstanding, 1,813,037.6020 shares will be reserved, and 32,638,269.9776 shares will be authorized, unreserved and unissued; (b) 3,000,000 shares of Nonvoting Common Stock will be authorized, of which 90,603.6022 will be issued and outstanding, and 2,909,396.3978 unreserved and unissued; (c) 2,000,000 shares of Preferred Stock, of which (1) 465,000 shares have been designated Series A Cumulative Redeemable Preferred Stock, none of which are issued and outstanding (before giving effect to the purchase of the Shares and the remainder of the Class 2) 265,000 shares have been designated Series B Preferred Stock), 11,790,324 of which shall be reserved for issuance upon conversion of the Class A Cumulative Redeemable Preferred Stock, 2,833,565 none of which shall are issued and outstanding, and (3) 40,000 shares have been designated Series C Preferred, of which 18,849.84110 will be reserved for issuance upon conversion of all issued and outstanding, and 21,150.15890 will be authorized, unreserved and unissued. As of the Class B Preferred StockClosing, and 5,154,408 of which neither the Company nor any Subsidiary shall be reserved for issuance upon exercise of outstanding options and warrants. Except as aforesaid, as of the date of this Agreement, HI shall not have outstanding any stock, investment rights, options, stock or securities convertible, exercisable, convertible or exchangeable for (or any agreements under which HI is or may become obligated to issue, sell, or transfer) any shares of its capital stock or containing any profit participation features, nor shall it have outstanding any rights or options to subscribe for or to purchase its capital stock or any stock or securities convertible into or exchangeable for its capital stock or any stock appreciation rights or phantom stock plans, except as set forth on the attached "Capitalization Schedule." The Capitalization Schedule accurately sets forth the following information with respect to all outstanding options and rights to acquire the Company's capital stock: the holder, the number of shares covered, the exercise price and the expiration date. As of the date Closing, neither the Company nor any Subsidiary shall be subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of this Agreementits capital stock or any warrants, options or other rights to acquire its capital stock, except as set forth on the Capitalization Schedule and except pursuant to the Certificate. As of the Closing, all of the outstanding shares of HIthe Company's capital stock shall be validly issued, fully paid, paid and nonassessable and were issued in compliance with all applicable state and federal securities laws. There are no statutory or contractual stockholder's preemptive rights or rights of first refusal, with respect to the Shares or Underlying Common Stock which have not been effectively waived in writing. HI has not violated any applicable federal or state securities laws in connection with the offer, sale, or issuance of the Shares, and assuming the accuracy of the representations and warranties of the Investor set forth in Article 4 hereof, the offer, sale, and issuance of the Shares hereunder do not require registration under the Securities Act or any applicable state securities laws. All the rights, preferences, privileges and restrictions of the Shares are set forth in the Transaction Documents. No equity securities or rights to purchase equity securities provides for acceleration or other changes in vesting provisions or other terms governing such securities as a result of a Public Offering, merger, consolidation, change of control or sale of assets except as described on Schedule 5.3nonassessable.