Common use of Capitalization, Etc Clause in Contracts

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) shares of Company Common Stock, par value $.01 per share, and (ii) five million (5,000,000) shares of preferred stock, par value $.01 per share. As of the date hereof, (i) 8,440,948 shares of Company Common Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) as of the date hereof, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding. All of the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. There are no shares of Company Common Stock held by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Person.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) of 70,000,000 shares of Company Common Stock, par value $.01 per share, and (ii) five million (5,000,000) 5,400,000 shares of preferred stockCompany Series A Preferred Stock, par value $.01 per share2,188,425 shares of Company Series A-1 Preferred Stock, 2,175,162 shares of Company Series B Preferred Stock and 5,000,000 undesignated shares. As of the date hereofof this Agreement, (i) 8,440,948 7,724,137 shares of Company Common Stock were issued and outstandingStock, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 4,737,561 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 Series A Preferred Stock, 2,188,425 shares of Company Common Series A-1 Preferred Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) as of the date hereof, no and 2,162,150 shares of capital stock of the Company were authorized, issued, reserved for issuance or Series B Preferred Stock are issued and outstanding. All of the outstanding shares of Company Common Stock and Company Preferred Stock have been duly authorized and validly issued, and are fully paid and nonassessablenon assessable. As of the date of this Agreement, Part 2.3(a) of the Company Disclosure Schedule sets forth the names of the Company’s stockholders and the class, series and number of shares of the Company’s capital stock owned of record by such stockholders. All outstanding shares of Company Common Stock and Company Preferred Stock have been issued and granted in compliance with (i) all applicable federal and state securities laws, (ii) all other applicable Legal Requirements, except as would not reasonably be expected to have a Company Material Adverse Effect, and (iii) all requirements set forth in Company Constituent Documents and applicable Contracts. Part 2.3(a) of the Company Disclosure Schedule provides an accurate and complete description of the terms of each repurchase option which is held by the Company and to which any shares of capital stock of the Company is subject and identifies the Contract underlying such right. The Company has no authorized shares other than as set forth in this Section 2.3(a) and as of the date of this Agreement there are no issued and outstanding shares of the Company’s capital stock other than the shares of Company Common Stock and Company Preferred Stock as set forth in this Section 2.3(a). Except as set forth in Part 2.3(a) of the Company Disclosure Schedule, each share of Company Preferred Stock is convertible into Company Common Stock on a one-for-one basis. There are no declared but unpaid dividends with respect to any shares of capital stock of the Company. There are no shares of capital stock of the Company Common Stock held by any of in the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Persontreasury.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) of 100,000,000 shares of Company Common Stock, par value $.01 per share, Stock and (ii) five million (5,000,000) 25,000,000 shares of preferred stock, par value $.01 0.01 per share. As share (the “Company Preferred Stock”) of the date hereof, (i) 8,440,948 which 21,809,395 shares of Company Common Stock and no shares of Company Preferred Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) outstanding as of the date hereof, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstandingthis Agreement. All of the outstanding shares of Company Common Stock have been (i) are duly authorized and authorized, validly issued, and are fully paid and nonassessable. There non-assessable, (ii) are no shares free of Company Common Stock held by any Liens and pre-emptive or similar rights, and (iii) were not issued in material violation of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive rightrights or rights of first refusal created by statute, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute agreement to which any the Company is a party or by which it is bound. As of the Acquired Companies is subject)date of this Agreement, there were (i) 1,068,325 shares of Company Common Stock reserved for issuance under the 2005 Plan, of which 545,250 shares of Company Common Stock were subject to outstanding Company RSUs and 523,075 shares of Company Common Stock were reserved for future Company RSU grants and (ii) 57,883 shares of Company Common Stock reserved for issuance under the 2003 Plan, none of which were subject to outstanding options. None The Company has delivered to the Parents or their Representatives (or made available in a data room) true and complete copies of the Acquired Companies 2005 Plan and each form of agreement evidencing each award thereunder. Except for the rights created pursuant to this Agreement and the Company RSUs, there are no options, warrants, calls, rights, commitments or agreements that are outstanding to which the Company is under any obligationa party or by which it is bound, obligating the Company to issue, deliver, sell, repurchase or redeem, or is bound by any Contract pursuant cause to which it may become obligatedbe issued, to repurchasedelivered, redeem sold, repurchased or otherwise acquire redeemed, any shares of Company Common Stock or other capital stock of or equity interests in the Company or the Company Subsidiaries or obligating the Company to grant, extend, accelerate the vesting of, change the price of, or otherwise amend or enter into any Subsidiary option, warrant, call, right, commitment or agreement regarding shares of Company Common Stock or other capital stock of or equity interests in the Company or the Company Subsidiaries. All shares of Company Common Stock issuable upon exercise of the restricted share units described in this Section 2.3 will be, when issued pursuant to the terms of such restricted share units, duly authorized, validly issued, fully paid and nonassessable. There are no other contracts, commitments or agreements relating to the voting, purchase or sale of Company Common Stock between or among the Company and any of its stockholders. To the Company’s knowledge, there are no voting trusts, proxies, shareholder rights plans or other arrangements relating to the issuance, sale, voting, transfer, ownership or other rights with respect to any shares of capital stock of the Company. There are no outstanding bonds, debentures, notes or other indebtedness of the Company having the right to vote (or convertible into, or exchangeable for, securities having the right to provide vote) on any funds to or make any investment in (A) any Subsidiary of matter on which the Company that is not wholly-owned by the Company or (B) any other PersonCompany’s shareholders may vote.

Capitalization, Etc. (a) The authorized capital stock Capital Stock of the Company consists of: (i) twenty-five million (25,000,000) of 45,000,000 shares of Company Common Stock, par value $.01 per share, of which 3,994,668 shares have been issued and (ii) five million (5,000,000) are outstanding and 30,000,000 shares of preferred stockPreferred Stock, par value $.01 per shareof which 24,733,004 shares have been issued and are outstanding. As There are no shares of Capital Stock held in the Company's treasury. Part 2.3(a) of the date hereofDisclosure Schedule sets forth the names of the Company's Stockholders, (i) 8,440,948 the addresses of the Company's Stockholders and the number of shares of Company Common Stock were issued and outstanding, (ii) no shares owned of the Company’s preferred stock were issued or outstanding, (iii) no shares record by each of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) as of the date hereof, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstandingsuch Stockholders. All of the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. There are no shares of Company Common Stock held by any non-assessable, and except as set forth in Part 2.3(a) of the Company’s SubsidiariesDisclosure Schedule, none of such shares is subject to any repurchase option or restriction on transfer (other than restrictions on transfer imposed by virtue of applicable federal and state securities laws). None As of the date hereof, Parent is acquiring good and valid title to all of the outstanding shares of Company Common Stock, free and clear of any Encumbrances. Part 2.3(b)(i) of the Disclosure Schedule sets forth the following information with respect to each option that was outstanding under the Company's 1998 Stock Option Plan (the "Stock Option Plan") immediately prior to the execution of this Agreement: (i) the name of the holder of the option; (ii) the address of the holder of the option; (iii) the number of options held by such holder and the number of such options that are vested and unvested; (iv) the vesting schedule applicable to such options; (v) whether such options are incentive stock options or non qualified stock options; (vi) the date on which such option was granted; and (vii) the total number of options reserved for the option pool, available for issuance and issued and outstanding. Part 2.3(b)(ii) of the Disclosure Schedule sets forth the following information with respect to each Company Option, that was outstanding immediately prior to the execution of this Agreement (excluding those identified in Part 2.3(b)(i) of the Disclosure Schedule): (i) the name of the holder thereof; (ii) the principal amount of each convertible note or other convertible debt security; (iii) whether such security is entitled immediately convertible and, if not, the conditions that must be satisfied before such security becomes convertible; and (iv) the class of shares into which such security is convertible. Other than as set forth in Part 2.3(b) of the Disclosure Schedule, there is no: (i) outstanding subscription, option, call, warrant or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant or not currently exercisable) to acquire, or otherwise relating to, any shares of the Capital Stock or other securities of the Company; (ii) outstanding security, instrument or obligation that is or may become convertible into or exchangeable for any shares of the Capital Stock or other securities of the Company; (iii) Contract under which the Company is or may become obligated to sell or otherwise issue any shares of its Capital Stock or any other securities; or (iv) condition or circumstance that may give rise to or provide a basis for the assertion of a claim by any Person to the certificate effect that such Person is entitled to acquire or receive any shares of incorporation Capital Stock or bylaws other securities of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject)Company. None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any All shares of Company Common Stock or capital stock of any Subsidiary and all other securities of the Company have been issued in compliance with (i) all applicable securities laws and other applicable Legal Requirements, and (ii) all requirements set forth in applicable Contracts. Any shares of Capital Stock or to provide any funds to other securities repurchased, redeemed or make any investment in (A) any Subsidiary of the Company that is not wholly-owned otherwise reacquired by the Company or were validly reacquired in compliance with (Bi) the applicable provisions of the DGCL and all other applicable Legal Requirements, and (ii) any other Personmaterial requirements set forth in applicable Contracts.

Capitalization, Etc. (a) The authorized capital stock shares of the Company consists of: (i) twenty-five million (25,000,000) shares of Company 700,000,000 Common Stock, par value $.01 per share, and (ii) five million (5,000,000) shares of preferred stock, par value $.01 per shareShares. As of the date hereof, (a) 267,337,252 Common Shares are outstanding, (b) no Common Shares and no preferred shares are held by the Company in its treasury, (c) no Common Shares or preferred shares of the Company are held by the Company's Subsidiaries, and (d) no preferred shares of the Company are outstanding. Section 3.4 of the Company Disclosure Letter sets forth a complete and accurate list, as of the date hereof, of (i) 8,440,948 shares the number of outstanding options (individually, an "Option" and collectively the "Options") outstanding under any share option plan adopted or assumed by the Company Common Stock were or otherwise outstanding and issued and outstandingto an employee, director, consultant or advisor of the Company or any of its Subsidiaries, (ii) no shares the number of Common Shares which can be acquired upon the Company’s preferred stock were issued or outstandingexercise of all outstanding Options, (iii) no the number of Common Shares and preferred shares which are reserved for issuance upon the exercise of capital stock outstanding Options and the number of the Company were held in shares which are reserved for future grants under any share option plan adopted or assumed by the Company’s treasury, and (iv) 2,600,000 shares the exercise price of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Planeach outstanding Option. Except as set forth in this Section 2.3(a) as 3.4 of the date hereofCompany Disclosure Letter, the Company has no outstanding bonds, debentures, notes or other obligations entitling the holders thereof to vote (or which are convertible into or exercisable for securities having the right to vote) with the shareholders of the Company on any matter. Except as set forth in Section 3.4 of the Company Disclosure Letter, since March 31, 2000, the Company (i) has not issued any Common Shares other than upon the exercise of Options, (ii) has granted no Options to purchase Common Shares under share option plans, or (iii) has not split, combined or reclassified any of its shares of capital stock shares. All issued and outstanding Common Shares are duly authorized, validly issued, fully paid, nonassessable and free of preemptive rights. Except as set forth above in this Section 3.4 or in Section 3.4 of the Company were authorizedDisclosure Letter, issued, reserved for issuance there are no other shares of capital shares or outstanding. All voting securities of the outstanding Company, and no existing options, warrants, calls, subscriptions, convertible securities, and no share appreciation rights or limited share appreciation rights or other rights (including rights of first refusal), agreements or commitments which obligate the Company or any of its Subsidiaries to issue, transfer or sell any shares of capital shares of, or equity interests in, or any material assets of, the Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessableor any of its Subsidiaries. There are no shares of Company Common Stock held by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws obligations of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, Subsidiaries to repurchase, redeem or otherwise acquire any shares of capital shares of the Company Common Stock and there are no performance awards outstanding under the share option plan or any other outstanding shares related awards. There are no voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party with respect to the voting of capital stock of any Subsidiary shares of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Personits Subsidiaries.

Capitalization, Etc. (a) The authorized capital stock of the Company Corautus consists of: of (i) twenty-five million (25,000,000) 100,000,000 shares of Company Common Stockcommon stock, par value $.01 0.001 per shareshare (the “Corautus Common Stock”), of which, as of the date hereof, 19,728,854 shares have been issued and are outstanding as of the date of this Agreement, and (ii) five million (5,000,000) 5,000,000 shares of preferred stock, par value $.01 0.001 per share. As , of the date hereofwhich: (a) 40,000 shares have been designated as Series A Preferred Stock, (i) 8,440,948 shares of Company Common Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) which are outstanding as of the date hereofof this Agreement; (b) 13,000 shares have been designated as Series B Preferred Stock, no shares of capital stock which are outstanding as of the Company were authorizeddate of this Agreement; (c) 17,000 shares have been designated as Series C Preferred Stock, issued2,000 shares of which have been issued or are outstanding as of the date of this Agreement; (d) 1,400,000 shares have been designated as Series D Preferred Stock, reserved for issuance 1,385,377 shares of which have been issued or outstandingare outstanding as of the date of this Agreement; (e) 3,500,000 shares have been designated as Series E Preferred Stock, 2,475,659 shares of which have been issued or are outstanding as of the date of this Agreement (the Corautus Series C Preferred Stock, the Series D Preferred Stock and the Series E Preferred Stock is referred to herein, collectively, as the “Corautus Preferred Stock”). Corautus holds 30,224 shares of its common stock in its treasury. All of the outstanding shares of Company Corautus Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. There are no shares of Company Common Stock held by any Except as set forth on Section 3.3(a)(i) of the Company’s Subsidiaries. None Corautus Disclosure Schedule, none of the outstanding shares of Company Corautus Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject)right. None of the Acquired Companies outstanding shares of Corautus Common Stock is subject to any right of first refusal in favor of Corautus. Except as contemplated herein and except as identified on Section 3.3(a)(i) of the Corautus Disclosure Schedule there is no Corautus Contract relating to the voting or registration of, or restricting any Person from purchasing, selling, pledging or otherwise disposing of (or granting any option or similar right with respect to), any shares of Corautus Common Stock. Corautus is not under any obligation, or nor is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any outstanding shares of Company Corautus Common Stock or capital stock of any Subsidiary other securities. Section 3.3(a)(ii) of the Company or Corautus Disclosure Schedule accurately and completely describes all repurchase rights held by Corautus with respect to provide any funds shares of Corautus Common Stock (including shares issued pursuant to or make any investment in (Athe exercise of stock options) any Subsidiary and specifies which of the Company that is not wholly-owned by the Company or (B) any other Personthose repurchase rights are currently exercisable.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) of 40,000,000 shares of Company Common Stock, par value $.01 per share, and (ii) five million (5,000,000) of which 8,600,127 shares of preferred stock, par value $.01 per share. As of the date hereof, (i) 8,440,948 shares of Company Common Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) outstanding as of the date hereofMay 3, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding2007. All of the outstanding shares of Company Common Stock have been (i) are duly authorized and authorized, validly issued, and are fully paid and nonassessable. There non-assessable, (ii) are no shares free of Company Common Stock held any Liens created by any of the Company’s Subsidiaries. None , and (iii) were not issued in violation of the outstanding shares of Company Common Stock is entitled or subject to any preemptive rightrights or rights of first refusal created by statute, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute agreement to which any the Company is a party or by which it is bound. As of May 3, 2007, there were 801,278 shares of Company Common Stock reserved for issuance under the Option Plans, of which 610,566 shares of Company Common Stock were subject to outstanding options and 190,712 shares of Company Common Stock were reserved for future option grants. The Company has delivered to Parent or its Representatives (or made available in a data room) true and complete copies of the Acquired Companies is subjectOption Plans and each form of agreement evidencing each award thereunder (and each such agreement accurately reflects the actual date of grant of such award determined in accordance with GAAP). None of Except for the Acquired Companies rights created pursuant to this Agreement and the options and other rights disclosed in the preceding sentences, there are no options, warrants, calls, rights, commitments or agreements that are outstanding to which the Company is under any obligationa party or by which it is bound, obligating the Company to issue, deliver, sell, repurchase or redeem, or is bound by any Contract pursuant cause to which it may become obligatedbe issued, to repurchasedelivered, redeem sold, repurchased or otherwise acquire redeemed, any shares of Company Common Stock or other capital stock of any Subsidiary of or equity interests in the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by Subsidiaries or obligating the Company to grant, extend, accelerate the vesting of, change the price of, or otherwise amend or enter into any option, warrant, call, right, commitment or agreement regarding shares of Company Common Stock or other capital stock of or equity interests in the Company or the Company Subsidiaries. All shares of Company Common Stock issuable upon exercise of the options described in this Section 2.3 will be, when issued pursuant to the terms of such options, duly authorized, validly issued, fully paid and nonassessable. There are no other contracts, commitments or agreements relating to the voting, purchase or sale of Company Common Stock between or among the Company and any of its stockholders; and (Bii) to the Company’s Knowledge, between or among any other PersonCompany Common Stockholders.

Capitalization, Etc. (a) The As of the date hereof, the authorized capital stock of the Company consists of: of (i) twenty-five million (25,000,000) 30,125,169 shares of Company Common Stock, par value $.01 per share, of which 5,077,000 shares are issued and outstanding and (ii) five million (5,000,000) 23,010,169 shares of preferred stockCompany Preferred Stock; 4,343,500 shares of which are designated as Series A Preferred Stock, par value $.01 per share4,322,500 shares of which are issued and outstanding; and 13,333,335 shares of which are designated as Series B Preferred Stock, 13,333,335 shares of which are issued and outstanding; 4,800,001 shares of which are designated as Series B-1 Non-Voting Preferred Stock, 4,800,001 shares of which are issued and outstanding; and 533,333 shares of which are designated as Series B-2 Preferred Stock, 533,333 shares of which are issued and outstanding. As of the date hereof, (i) 8,440,948 The Company has reserved an additional 4,000,000 shares of Company Common Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (to employees, advisory board members, officers or directors of, or consultants to, the “1996 Stock Option Plan”) and (v) 1,000,000 Company, of which options to acquire 1,334,346 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) as are outstanding, of the date hereof, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding. All of the outstanding which options to purchase 216,471 shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessablevested. There are no Part 2.3(a) of the Disclosure Schedule sets forth the following information (which is accurate in all material respects) with respect to each option to purchase Company Common Stock outstanding as of the date of this Agreement: (i) the name of the optionee; (ii) the number of shares of Company Common Stock held by any subject to such option; (iii) the exercise price of such option; (iv) the date on which such option was granted; (v) the applicable vesting schedules, and the extent to which such option is vested and exercisable as of the Company’s Subsidiariesdate of this Agreement; and (vi) the date on which such option expires. None of the outstanding shares of The Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Person.has

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: of (i) twenty-five million (25,000,000) 35,000,000 shares of Company Common Stock, par value $.01 per shareof which 7,568,664 shares have been issued and are outstanding, and (ii) five million (5,000,000) shares of preferred stock, par value $.01 per share. As of the date hereof, (i) 8,440,948 15,000,000 shares of Company Common Stock were Preferred Stock, of which 3,508,995 shares have been issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) as of the date hereof, no shares of capital stock of the Company were authorized, issued, reserved for issuance or are outstanding. All of the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessablenon-assessable. There Part 2.5(a) of the Company Disclosure Schedule sets forth the ownership of the Company Capital Stock, noting any shares that are subject to any repurchase option, forfeiture provision or restriction on transfer (other than restrictions on transfer imposed by virtue of applicable federal and state securities laws) (“Restricted Shares”). The Stockholders own 100% of the equity of the Company (the “Company Equity”) and Part 2.5(a) of the Company Disclosure Schedule sets forth a complete and correct list of (a) the issued and outstanding Company Equity, including the name of the record and beneficial owner thereof and the number of shares of Company Capital Stock held thereby and specifying the class of such stock, and (b) all outstanding options to acquire Company Equity, including with respect to each such option, the holder, the number of shares of Company Capital Stock subject thereto, the grant date, the exercise price for such option and the date on which such option expires. All of the outstanding Company Equity has been, and all shares which may be issued pursuant to the exercise of options to purchase shares of Company Capital Stock or warrants exercisable into Company Capital Stock, when issued in accordance with the applicable security, will be, duly authorized, validly issued and are fully paid and non-assessable. Other than pursuant to Section 262 of the DGCL, none of the Stockholders are entitled to, and no shares of Company Common Capital Stock held by any of the Companyare subject to, dissenter’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive rightrights, right of participationappraisal rights, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment rights in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Personjurisdiction.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) of 60,000,000 shares of Company Common Stock, par value $.01 per share, Stock and (ii) five million (5,000,000) 15,000,000 shares of preferred stock, $.01 par value $.01 per share("Preferred Stock"). As of the date hereof, (ia) 8,440,948 12,416,297 shares of Company Common Stock were issued and are outstanding, (iib) no shares of the Company’s preferred stock were issued or outstandingPreferred Stock are outstanding and no series of Preferred Stock has been established, (iiic) 9,670 shares of Common Stock are held by the Company in its treasury, and (d) no shares of capital stock of the Company were are held in by the Company’s treasury's Subsidiaries. Section 4.4 of the disclosure letter, dated as of the date hereof, delivered by the Company to Parent (the "Company Disclosure Letter") sets forth a complete and accurate list, as of the date hereof, of (i) the number of outstanding Options, (ivii) 2,600,000 the number of shares of Company Common Stock were reserved for issuance under which can be acquired upon the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) exercise of all outstanding Options, respectively, and (viii) 1,000,000 shares the exercise price of each outstanding Option. The Company has no outstanding bonds, debentures, notes or other obligations entitling the holders thereof to vote (or which are convertible into or exercisable for securities having the right to vote) with the holders of the Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Planon any matter. Except as set forth in Section 4.4 of the Company Disclosure Letter, since September 30, 1999, the Company (i) has not issued any shares of Common Stock other than upon the exercise of Options, (ii) has granted no Options to purchase shares of Common Stock under the Company Stock Plans to the executive officers of the Company, (iii) has not granted any Award (as defined in the Trigen Energy Corporation 1994 Stock Incentive Plan) to any of the executive officers of the Company, and (iv) has not split, combined or reclassified any of its shares of capital stock. All issued and outstanding shares of Common Stock are duly authorized, validly issued, fully paid, nonassessable and free of preemptive rights. Except as set forth above in this Section 2.3(a) as 4.4 or in Section 4.4 of the date hereofCompany Disclosure Letter, there are no other shares of capital stock or voting securities of the Company, and no existing options, warrants, calls, subscriptions, convertible securities, and no stock appreciation rights or limited stock appreciation rights or other rights (including rights of first refusal), agreements or commitments which obligate the Company were authorizedor any of its Subsidiaries to issue, issued, reserved for issuance transfer or outstanding. All of the outstanding sell any shares of capital stock of, or equity interests in, or any material assets of, the Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessableor any of its Subsidiaries. There are no shares of Company Common Stock held by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws obligations of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, Subsidiaries to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of the Company. At the Effective Time, each outstanding Option, and each outstanding Award awarded or granted under the Trigen Energy Corporation 1994 Stock Incentive Plan, shall be canceled without the consent of any Subsidiary other party or the payment of any consideration other than as provided in Section 3.2. After the Effective Time, the Surviving Corporation will have no obligation to issue, transfer or sell any shares of capital stock of the Company or the Surviving Corporation pursuant to provide any funds Company Employee Benefit Plan. There are no voting trusts or other agreements or understandings to which the Company or make any investment in (A) any Subsidiary of its Subsidiaries is a party with respect to the voting of capital stock of the Company that is not wholly-owned by the Company or (B) any other Personof its Subsidiaries.

Capitalization, Etc. (a) The As of the date of this Agreement, the authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) 100,000,000 shares of Company Common Stock, par value $.01 per share, of which 13,720,746 shares have been issued and are outstanding; and (ii) five million (5,000,000) 31,177,994 shares of preferred stockCompany Preferred Stock, par value $.01 per shareof which (A) 10,039,783 have been designated Series A Preferred Stock, 9,838,290 of which are outstanding and (B) 21,138,211 have been designated Series B Preferred Stock, all of which are outstanding. As Each share of the date hereof, (i) 8,440,948 Series A Preferred Stock is convertible into 1.279479 shares of Company Common Stock. Each share of Series B Preferred Stock were is convertible into one share of Company Common Stock. The Company holds no treasury shares. There are no other issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no outstanding shares of capital stock or other securities of the Company were held in the Company’s treasury, (iv) 2,600,000 and no outstanding commitments or Contracts to issue any shares of capital stock or other securities of the Company Common Stock were reserved for issuance other than pursuant to the exercise of outstanding Company Options under the Amended and Restated 1996 Incentive and Non-Incentive Company Stock Option Plan (Plans. Part 2.4(a) of the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) Disclosure Schedule accurately sets forth, as of the date hereof, no shares the name of capital stock each Person that is the registered owner of the Company were authorized, issued, reserved for issuance or outstanding. All of the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. There are no shares of Company Common Stock held by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or Company Preferred Stock and the number of such shares so owned by such Person, and the number of shares of Company Common Stock that would be owned by such Person assuming conversion of all shares of Company Preferred Stock so owned by such Person giving effect to all anti-dilution and similar adjustments. The number of such shares set forth as being so owned by such Person constitutes the entire interest of such Person in the issued and outstanding capital stock of any Subsidiary or voting securities of the Company or to provide any funds to or make any investment in (A) any Subsidiary as of the date hereof. All issued and outstanding shares of Company that Capital Stock are duly authorized, validly issued, fully paid and non-assessable and are free of any Encumbrances, preemptive rights, rights of first refusal or “put” or “call” rights created by statute, the Company’s Articles of Incorporation or Bylaws, or any Contract to which the Company is a party or by which the Company is bound. All issued and outstanding shares of Company Capital Stock were issued in compliance with all applicable Legal Requirements and all requirements set forth in applicable Contracts. There is no Liability for dividends declared or accrued and unpaid by Company. The Company is not wholly-owned by under any obligation to register under the Securities Act any shares of Company Capital Stock or (B) any other Personsecurities of the Company, whether currently outstanding or that may subsequently be issued.

Capitalization, Etc. As of the date hereof, UOL's authorized capitalization consists of (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) 36,000,000 shares of Company Common Stock, par value $.01 0.01 per share, of which 9,777,524 shares are issued and outstanding and (iib) five million (5,000,000) 34,000,000 shares of preferred stockPreferred Stock, par value $.01 0.01 per share, of which 12,000,000 shares have been designated "Series A Preferred Stock" (and there are now outstanding 4,742,406 of such Series A Preferred Stock), 6,000,000 shares have been designated "Series B Preferred Stock" (and there are now none outstanding) and 6,000,000 shares have been designated "Series B-1 Preferred Stock" (and there are now outstanding 2,187,500 of such Series B-1 Preferred Stock). As The Common Stock issuable upon exercise of the date hereof, (i) 8,440,948 shares of Company Common Stock were issued Warrants to be acquired pursuant to this agreement have been duly and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were validly reserved for issuance under and, upon issuance, will be duly and validly issued, fully paid and non-assessable and will be free of restrictions on transfer, except pursuant to applicable federal and state securities laws. All corporate action on the Amended part of UOL and Restated 1996 Incentive stockholders thereof, if necessary, for the authorization, execution and Non-Incentive Stock Option Plan (delivery of this agreement and the “1996 Stock Option Plan”) Warrants contemplated hereby, and (v) 1,000,000 shares the authorization, issuance or reservation for issuance of Company such Warrants and the Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Planissuable upon exercise thereof has been taken. Except as set forth in this Section 2.3(a) on SCHEDULE 7.2 or as of contemplated by the date hereofWarrants issuable hereunder, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding. All of the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. There there are no shares outstanding options, warrants, rights (including conversion or pre-emptive rights) or agreements for the purchase or acquisition from UOL of Company Common Stock held by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or its capital stock or any rights which permit or allow a holder of any Subsidiary securities of UOL to cause UOL to file a registration statement or which permit or allow the Company or holder thereof to provide any funds to or make any investment include securities of UOL in (A) any Subsidiary of the Company that is not wholly-owned a registration statement filed by the Company or (B) any other PersonUOL.

Capitalization, Etc. (aA) The authorized capital stock of the Company consists ofof 200,000,000 shares of Company Common Stock and 1,000,000 shares of preferred stock ("PREFERRED SHARES"). As of 5:00 p.m. Pacific Time on May 15, 2008: (i) twenty-five million (25,000,000) shares of Company Common Stock, par value $.01 per share, and (ii) five million (5,000,000) shares of preferred stock, par value $.01 per share. As of the date hereof, (i) 8,440,948 19,031,276 shares of Company Common Stock were issued and outstandingoutstanding (including shares of Company Common Stock included in the Company Units), of which no shares were unvested or were subject to any repurchase rights, risk of forfeiture or other similar condition in favor of the Company; (ii) no shares of the Company’s preferred stock Preferred Shares were issued or outstanding, ; (iii) no 33,033,013 shares of capital stock Company Common Stock were issuable upon exercise of Company Warrants that were issued and outstanding (including shares of Company Common Stock issuable upon exercise of Company Warrants included in the Company Units); (iii) 3,108,618 shares of Company Common Stock were held in issuable upon exercise of options issued pursuant to the Company’s treasury, Company Equity Plan; and (iv) 2,600,000 17,489,813 shares of Company Common Stock were issuable upon conversion of $128,200,000 aggregate principal amount of Convertible Notes. As of 5:00 p.m. Pacific Time on May 15, 2008, 2,064,090 Company Units were outstanding (which Company Units are included in the totals above). Between 5:00 p.m. Pacific Time on May 15, 2008 and the date of this Agreement, the Company has not issued any shares of Company Common Stock except upon exercise of outstanding Company Options or Company Warrants or conversion of outstanding Convertible Notes in accordance with their terms. As of the date of this Agreement, 4,366,544 shares of Company Common Stock were reserved for future issuance under pursuant to the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Equity Plan. Except as set forth in this Section 2.3(aThe Company has made available to Parent or Parent's legal advisor copies of (A) the Company Equity Plan, which covers the stock options and restricted stock awards granted by the Company that are outstanding as of the date hereof, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding. All of the outstanding shares of Company Common Stock have been duly authorized and validly issuedthis Agreement, and are fully paid and nonassessable. There are no shares of Company Common Stock held by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Personthe forms of all stock option agreements and restricted stock award agreements evidencing such options and stock awards.

Capitalization, Etc. (a) The authorized capital stock of the Company i2 Telecom consists of: (i) twenty-five million (25,000,000) 10,000,000 shares of Company i2 Telecom Common Stock, par value $.01 per share, of which 2,278,926 shares have been issued and are outstanding as of the date of this Agreement; and (ii) five million (5,000,000) shares of preferred stock, par value $.01 per share. As of the date hereof, (i) 8,440,948 shares of Company Common Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common i2 Telecom Preferred Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except (A) 100,000 shares of which have been designated as set forth in this Section 2.3(a) i2 Telecom Preferred Stock Series A-1 with 25,000 shares of such series outstanding as of the date hereofof this Agreement, no and (B) 100,000 shares of which have been designated as i2 Telecom Preferred Stock Series A-2 with 34,000 shares of such series outstanding as of the date of this Agreement. Except as identified in Part 2.3(a) of the i2 Telecom Disclosure Schedule, i2 Telecom does not hold any shares of its capital stock of the Company were authorized, issued, reserved for issuance or outstandingin its treasury. All of the outstanding shares of Company i2 Telecom Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. There are no shares of Company Common Stock held by any Except as identified in Part 2.3(a) of the Company’s Subsidiaries. None i2 Telecom Disclosure Schedule: (i) none of the outstanding shares of Company i2 Telecom Common Stock is are entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right; (ii) none of the outstanding shares of i2 Telecom Common Stock are subject to any right of first refusal; and (whether pursuant iii) there is no i2 Telecom Entity Contract relating to the certificate voting or registration of, or restricting any Person from purchasing, selling, pledging or otherwise disposing of incorporation (or bylaws granting any option or similar right with respect to), any shares of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject)i2 Telecom Common Stock. None of the Acquired Companies i2 Telecom Entities is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any outstanding shares of Company i2 Telecom Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other PersonStock.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) of 40,000,000 shares of Company Common Stock, par value $.01 per share, and (ii) five million (5,000,000) of which 8,598,043 shares of preferred stock, par value $.01 per share. As of the date hereof, (i) 8,440,948 shares of Company Common Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) outstanding as of the date hereofFebruary 23, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding2007. All of the outstanding shares of Company Common Stock have been (i) are duly authorized and authorized, validly issued, and are fully paid and nonassessable. There non-assessable, (ii) are no shares free of Company Common Stock held any Liens created by any of the Company’s Subsidiaries. None , and (iii) were not issued in violation of the outstanding shares of Company Common Stock is entitled or subject to any preemptive rightrights or rights of first refusal created by statute, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute agreement to which any the Company is a party or by which it is bound. As of the Acquired Companies is subjectdate of this Agreement, there were 808,895 shares of Company Common Stock reserved for issuance under the Option Plans, of which 618,183 shares of Company Common Stock were subject to outstanding options and 190,712 shares of Company Common Stock were reserved for future option grants. The Company has delivered to Parent or its Representatives (or made available in a data room) true and complete copies of the Option Plans and each form of agreement evidencing each award thereunder (and each such agreement accurately reflects the actual date of grant of such award determined in accordance with GAAP). None of Except for the Acquired Companies rights created pursuant to this Agreement and the options and other rights disclosed in the preceding sentences, there are no options, warrants, calls, rights, commitments or agreements that are outstanding to which the Company is under any obligationa party or by which it is bound, obligating the Company to issue, deliver, sell, repurchase or redeem, or is bound by any Contract pursuant cause to which it may become obligatedbe issued, to repurchasedelivered, redeem sold, repurchased or otherwise acquire redeemed, any shares of Company Common Stock or other capital stock of any Subsidiary of or equity interests in the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by Subsidiaries or obligating the Company to grant, extend, accelerate the vesting of, change the price of, or otherwise amend or enter into any option, warrant, call, right, commitment or agreement regarding shares of Company Common Stock or other capital stock of or equity interests in the Company or the Company Subsidiaries. All shares of Company Common Stock issuable upon exercise of the options described in this Section 2.3 will be, when issued pursuant to the terms of such options, duly authorized, validly issued, fully paid and nonassessable. There are no other contracts, commitments or agreements relating to the voting, purchase or sale of Company Common Stock between or among the Company and any of its stockholders; and (Bii) to the Company’s Knowledge, between or among any other PersonCompany Common Stockholders.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) of 30,000,000 shares of Company Common Stock, par value $.01 per share, Stock and (ii) five million (5,000,000) 5,000,000 shares of preferred stock, par value $.01 per sharepar value, of which 30,000 shares have been designated as Series A Junior Participating Preferred Stock ("PREFERRED STOCK"). As of the date hereof, (ia) 8,440,948 7,818,087 shares of Company Common Stock were are outstanding, (b) 30,000 shares of Preferred Stock are subject to Preferred Stock Purchase Rights ("RIGHTS") issued pursuant to the Company's Rights Agreement and no other shares of Preferred Stock are issued and outstanding, (iic) no 0 shares of Common Stock are held by the Company’s preferred stock were issued or outstandingCompany in its treasury, and (iiid) no shares of capital stock of the Company were are held in by the Company’s treasury's Subsidiaries. SECTION 4.4 of the Company Disclosure Letter sets forth a complete and accurate list, as of the date hereof, of (i) the number of outstanding Options and Warrants, (ii) the number of shares of Common Stock which can be acquired upon the exercise of all outstanding Options and Warrants, respectively, (iii) the number of shares of Common Stock which are reserved for issuance upon the exercise of outstanding Options and the number of shares which are reserved for future grants under the Stock Option Plans, (iv) 2,600,000 the number of shares of Company Common Stock were which are reserved for issuance under upon the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) exercise of outstanding Warrants, and (v) 1,000,000 the exercise price of each outstanding Option and Warrant, and (vi) the number of shares of Company Common Stock were which are reserved for issuance under pursuant to the Company’s 2005 Incentive Compensation Purchase Plan. Except for the Common Stock, the Rights, the Options, the Warrants, and the Purchase Rights, the Company has no outstanding bonds, debentures, notes or other obligations entitling the holders thereof to vote (or which are convertible into or exercisable for securities having the right to vote) with the stockholders of the Company on any matter. Except as set forth in this Section 2.3(a) as SECTION 4.4 of the date hereofCompany Disclosure Letter, since March 31, 1999, the Company (i) has not issued any shares of Common Stock other than upon the exercise of Options and Warrants or pursuant to the Purchase Plan, (ii) has granted no Options to purchase shares of Common Stock under the Stock Option Plans, (iii) has not amended the Purchase Plan, and (iv) has not split, combined or reclassified any of its shares of capital stock. All issued and outstanding shares of Common Stock are duly authorized, validly issued, fully paid, nonassessable and free of preemptive rights. Except as set forth above in this SECTION 4.4 or in SECTION 4.4 of the Company Disclosure Letter, there are no other shares of capital stock or voting securities of the Company, and no existing options, warrants, calls, subscriptions, convertible securities, and no stock appreciation rights or limited stock appreciation rights or other rights (including rights of first refusal), agreements or commitments which obligate the Company or any of its Subsidiaries to issue, transfer or sell any shares of capital stock of, or equity interests in, or any material assets of, the Company or any of its Subsidiaries. Except as set forth in SECTION 4.4 of the Company were authorizedDisclosure Letter, issuedthe Company is not obligated to issue any Options, reserved for issuance Warrants or outstanding. All of Purchase Rights after the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessabledate hereof. There are no shares of Company Common Stock held by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws obligations of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, Subsidiaries to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of the Company and there are no unissued performance awards outstanding under the Stock Option Plan or any Subsidiary other outstanding stock related awards. At the Effective Time, each outstanding Option and Warrant shall be canceled without the consent of any other party or the payment of any consideration other than as provided in SECTION 3.2(d). After the Effective Time, the Surviving Corporation will have no obligation to issue, transfer or sell any shares of capital stock of the Company or the Surviving Corporation pursuant to provide any funds Company Employee Benefit Plan (as defined in SECTION 4.11). There are no voting trusts or other agreements or understandings to which the Company or make any investment in (A) any Subsidiary of its Subsidiaries is a party with respect to the voting of capital stock of the Company that is not wholly-owned by the Company or (B) any other Personof its Subsidiaries.

Capitalization, Etc. (a) The authorized and outstanding capital stock of the Company consists of: (i) twenty-five million (25,000,000) shares is as set forth in the Registration Statement, and the description of the Common Stock set forth in the Registration Statement under the caption "Description of Capital Stock" conforms with and accurately describes the rights set forth in the instruments defining the Company Common Stock, par value $.01 per share, . The Designated Stockholders own seventy-eight and four-tenths percent (ii78.4%) five million (5,000,000) shares of preferred stock, par value $.01 per share. As of the date hereof, (i) 8,440,948 shares of Company Common Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no outstanding shares of capital stock of the Company. Part 2.3 of the Disclosure Schedule accurately sets forth, with respect to each Company were held in Option that is outstanding as of the Company’s treasury, date of this Agreement: (ivi) 2,600,000 the name of the holder of such Company Option; (ii) the total number of shares of Company Common Stock were reserved for issuance under that are subject to such Company Option and the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 number of shares of Company Common Stock were reserved with respect to which such Company Option is immediately exercisable; (iii) the date on which such Company Option was granted and the term of such Company Option; (iv) the vesting schedule for issuance such Company Option; (v) the exercise price per share of Company Common Stock purchasable under such Company Option; and (vi) whether such Company Option has been designated an "incentive stock option" as defined in Section 422 of the Company’s 2005 Incentive Compensation PlanCode. Except as set forth in this Section 2.3(a) as Part 2.3 of the date hereofDisclosure Schedule, no there is no: (i) outstanding subscription, option, call, warrant or right (whether or not currently exercisable) to acquire any shares of the capital stock or other securities of the Company; (ii) outstanding security, instrument or obligation that is or may become convertible into or exchangeable for any shares of the capital stock or other securities of the Company; (iii) Contract under which the Company is or may become obligated to sell or otherwise issue any shares of its capital stock or any other securities; or (iv) to the best of the knowledge of the Company and the Designated Stockholders, condition or circumstance that may give rise to or provide a basis for the assertion of a claim by any Person to the effect that such Person is entitled to acquire or receive any shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding. All of the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. There are no shares of Company Common Stock held by any other securities of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Person.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: of (i) twenty-five million (25,000,000) 20,000,000 shares of Company Common Stock, par value $.01 per share, of which 2,454,428 shares are issued and outstanding as of the date of this Agreement and (ii) five million (5,000,000) 5,256,000 shares of preferred stockPreferred Stock, par value $.01 per share. As 56,000 of which are designated as Series A Preferred, 56,000 of which are issued and outstanding as of the date hereofof this Agreement, (i2,600,000 of which are designated Series B Preferred Stock, 2,403,742 of which are issued and outstanding as of the date of this Agreement, and 2,600,000 of which are designated as Series B1 Preferred Stock, none of which are issued and outstanding as of the date of this Agreement. Part 2.3(a)(1) 8,440,948 of the Disclosure Schedule sets forth the names of the Company's Shareholders as of the date of this Agreement and the number of shares of Company Common Stock were issued and outstanding, (ii) no shares Company Preferred Stock owned of record by each of such Shareholders as of the Company’s preferred stock were issued or outstanding, (iii) no shares date of capital stock of the this Agreement. The Company were held in the Company’s treasury, (iv) 2,600,000 has reserved an additional 2,086,924 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive its 1997 Stock Option Plan (the “1996 "Stock Option Plan”") to employees, advisory board members, officers or directors of, or consultants to, the Company, of which options to acquire 1,957,107 shares of Common Stock have been granted as of the date of this Agreement. Part 2.3(a)(2) of the Disclosure Schedule sets forth a true and (v) 1,000,000 complete list as of the date hereof of all holders of outstanding Company Options, including the number of shares of Company Common Stock were subject to each such Company Option, the exercise and vesting schedule, and the exercise price per share. The Company has reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) as of the date hereof, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding. All of the outstanding an additional 78,981 shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. There are no for issuance pursuant to outstanding warrants as of the date of this Agreement to purchase shares of Company Common Stock held by any Series B Preferred Stock. Part 2.3(a)(3) of the Disclosure Schedule sets forth the names of the Company’s Subsidiaries. None 's warrant holders as of the date of this Agreement and the number of shares issuable upon exercise of outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws warrants as of the Company or any Acquired Company Contract or any statute to which any date of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Personthis Agreement.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million Forty Million (25,000,00040,000,000) shares of Company Common Stock, $0.001 par value $.01 per share, of which, as of September 30, 1998, 14,579,376 shares (which amount does not materially differ from the amount issued and outstanding as of the date of this Agreement) have been issued and are outstanding; and (ii) five million Twenty Million (5,000,00020,000,000) shares of preferred stock, $0.001 par value $.01 per share. As , of the date hereofwhich (A) Six Hundred Thousand (600,000) shares have been designated Series A Junior Participating Preferred Stock, (i) 8,440,948 shares none of Company Common Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) which are outstanding as of the date hereofof this Agreement, no and (B) Three Million Seven Hundred Fifty Thousand (3,750,000) shares have been designated Series B Preferred Stock, all of capital stock which are outstanding as of the Company were authorized, issued, reserved for issuance or outstandingdate of this Agreement. All of the outstanding shares of Company Common Stock the Company's capital stock have been duly authorized and validly issued, and are fully paid and nonassessable. There are As of the date of this Agreement, no shares of Company Common Stock were held in treasury by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock the Company's capital stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right. Except for the shares of Series B Preferred Stock, none of the outstanding shares of the Company's capital stock is subject to any right of first refusal in favor of the Company. Except as provided in Part 2.3(a) of the Company Disclosure Schedule, there is no Company Contract relating to the voting or registration of, or restricting any Person from purchasing, selling, pledging or otherwise disposing of (whether or granting any option or similar right with respect to), any shares of Company Common Stock. Upon consummation of the Merger, (A) the shares of Parent Common Stock issued in exchange for any shares of Company Common Stock that are subject to a Contract pursuant to which the certificate Company has the right to repurchase, redeem or otherwise reacquire any shares of incorporation or bylaws Company Common Stock will, without any further act of Parent, the Company or any Acquired Company Contract or any statute other Person, become subject to which any of the Acquired Companies is subject). None of restrictions, conditions and other provisions contained in such Contract, and (B) Parent will automatically succeed to and become entitled to exercise the Acquired Companies is Company's rights and remedies under any obligation, or such Contract. The Company is bound by not under any Contract pursuant to which it may become obligated, obligation to repurchase, redeem or otherwise acquire any outstanding shares of Company Common Stock or the Company's capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Personstock.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) shares 800,000 shares, no par value, of Company common stock, of which 500,000 have been designated “Class A Voting Common Stock, par value $.01 per share, ,” of which 156,486 shares have been issued and are outstanding as of the date of this Agreement; and of which 100,000 have been designated “Class B Voting Common Stock,” of which 79,830 shares have been issued and are outstanding as of the date of this Agreement; and of which 100,000 have been designated “Class C Voting Common Stock,” of which 53,220 shares have been issued and are outstanding as of the date of this Agreement; and of which 100,000 have been designated “Class D Voting Common Stock,” of which 28,292 shares have been issued and are outstanding as of the date of this Agreement; and (ii) five million (5,000,000) 100,000 shares of preferred stock, no par value $.01 per share. As value, of the date hereof, (i) 8,440,948 shares of Company Common Stock were which none are issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) outstanding as of the date hereofof this Agreement. Each share of the Class B Voting Common Stock, no the Class C Voting Common Stock, and the Class D Voting Common Stock is convertible into one share of Class A Voting Common Stock in accordance with the Company’s charter. The Company has reserved sufficient shares of capital stock of the Company were authorized, issued, reserved Class A Voting Common Stock for issuance or outstandingupon conversion of all the Class B Voting Common Stock, Class C Voting Common Stock, and Class D Voting Common Stock. All of the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessablenon-assessable. There are no shares of Company Common Stock held by any of the Company’s Subsidiaries. None of the All outstanding shares of Company Common Stock is entitled or subject to any preemptive rightand all outstanding Company Options have been issued and granted in material compliance with (i) all applicable securities laws and other applicable Legal Requirements, right of participation, right of maintenance or any similar right and (whether pursuant to ii) all requirements set forth in the certificate of incorporation or bylaws Company Constituent Documents and applicable Company Contracts. Except as set forth in Part 2.3(a) of the Company or any Acquired Disclosure Schedule, there are no repurchase options which are held by the Company Contract or any statute and to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Personare subject.

Capitalization, Etc. (a) The authorized capital stock of the Company consists ofof 200,000,000 shares of Company Common Stock and 1,000,000 shares of preferred stock (“Preferred Shares”). As of 5:00 p.m. Pacific Time on May 15, 2008: (i) twenty-five million (25,000,000) shares of Company Common Stock, par value $.01 per share, and (ii) five million (5,000,000) shares of preferred stock, par value $.01 per share. As of the date hereof, (i) 8,440,948 19,031,276 shares of Company Common Stock were issued and outstandingoutstanding (including shares of Company Common Stock included in the Company Units), of which no shares were unvested or were subject to any repurchase rights, risk of forfeiture or other similar condition in favor of the Company; (ii) no shares of the Company’s preferred stock Preferred Shares were issued or outstanding, ; (iii) no 33,033,013 shares of capital stock Company Common Stock were issuable upon exercise of Company Warrants that were issued and outstanding (including shares of Company Common Stock issuable upon exercise of Company Warrants included in the Company Units); (iii) 3,108,618 shares of Company Common Stock were held in issuable upon exercise of options issued pursuant to the Company’s treasury, Company Equity Plan; and (iv) 2,600,000 17,489,813 shares of Company Common Stock were issuable upon conversion of $128,200,000 aggregate principal amount of Convertible Notes. As of 5:00 p.m. Pacific Time on May 15, 2008, 2,064,090 Company Units were outstanding (which Company Units are included in the totals above). Between 5:00 p.m. Pacific Time on May 15, 2008 and the date of this Agreement, the Company has not issued any shares of Company Common Stock except upon exercise of outstanding Company Options or Company Warrants or conversion of outstanding Convertible Notes in accordance with their terms. As of the date of this Agreement, 4,366,544 shares of Company Common Stock were reserved for future issuance under pursuant to the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Equity Plan. Except as set forth in this Section 2.3(aThe Company has made available to Parent or Parent’s legal advisor copies of (A) the Company Equity Plan, which covers the stock options and restricted stock awards granted by the Company that are outstanding as of the date hereof, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding. All of the outstanding shares of Company Common Stock have been duly authorized and validly issuedthis Agreement, and are fully paid and nonassessable. There are no shares of Company Common Stock held by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital stock of any Subsidiary of the Company or to provide any funds to or make any investment in (A) any Subsidiary of the Company that is not wholly-owned by the Company or (B) any other Personthe forms of all stock option agreements and restricted stock award agreements evidencing such options and stock awards.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: of 27,750,000 shares of Common Stock (i) twenty-five million par value $0.001 per share), of which 9,869,176 shares have been issued and are outstanding as of the date of this Agreement and of which 293,017 shares have been repurchased by the Company, 5,664,048 shares of Series A Preferred Stock (25,000,000) par value $0.001 per share), of which 5,487,046 shares have been issued and are outstanding and of which no shares have been repurchased by the Company as of the date of this Agreement, 3,750,000 shares of Series B Preferred Stock (par value $0.001 per share), of which 3,033,854 shares have been issued and are outstanding as of the date of this Agreement and 2,200,000 shares of Series C Preferred Stock (par value $0.001 per share), 2,108,437 shares of which have been issued and are outstanding as of the date of this Agreement (the Company's Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock shall be collectively referred to herein as the "Company Preferred Stock" and, together with the Company Common Stock, shall be referred to as the "Company Stock"). No shares of Company Preferred Stock have been repurchased. Each outstanding share of Company Preferred Stock is convertible into one share of Company Common Stock, par value $.01 per share, and (ii) five million (5,000,000) shares of preferred stock, par value $.01 per share. As of the date hereof, (i) 8,440,948 shares of Company Common Stock were issued and outstanding, (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 shares of Company Common Stock were reserved for issuance under the Amended and Restated 1996 Incentive and Non-Incentive Stock Option Plan (the “1996 Stock Option Plan”) and (v) 1,000,000 shares of Company Common Stock were reserved for issuance under the Company’s 2005 Incentive Compensation Plan. Except as set forth in this Section 2.3(a) as of the date hereof, no shares of capital stock of the Company were authorized, issued, reserved for issuance or outstanding. All of the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and non-assessable. As of the date of this Agreement, the outstanding shares of Company Stock and all of the outstanding shares of capital stock of the Subsidiary is held by the Persons, with the addresses of record and in the amounts set forth in Part 2.3(a) of the Disclosure Schedule. Part 2.3(a) of the Disclosure Schedule also provides an accurate and complete description of the terms of each repurchase option which is held by the Company and to which any of such shares is subject. All of the stock of the Subsidiary owned by the Company is owned by the Company free and clear of any Encumbrance. All of the outstanding stock of the Subsidiary has been duly authorized and validly issued and is fully paid and nonassessable, has been issued in compliance with all applicable Legal Requirements, including securities laws, and was not issued in violation of or subject to any preemptive rights or other rights to subscribe for or purchase securities of such respective Subsidiary. There are no options, warrants or other rights outstanding to subscribe for or purchase any shares of the capital stock of the Subsidiary and the Subsidiary is not subject to any obligation, commitment, plan, arrangement or court or administrative order with respect to same. There are no preemptive rights applicable to any shares of capital of any of the Subsidiary. The Subsidiary does not have the right to vote on or approve the Merger or any of the other transactions contemplated herein. The Company has reserved 5,225,000 shares of Company Common Stock held by any for issuance under its 1998 Stock Plan, of which options to purchase 1,599,104 shares are outstanding as of the Company’s Subsidiariesdate of this Agreement. None Part 2.3(c) of the Disclosure Schedule accurately sets forth, with respect to each Company Option that is outstanding as of the date of this Agreement: (i) the name of the holder of such Company Option; (ii) the total number of shares of Company Common Stock is entitled or that are subject to any preemptive right, right such Company Option and the number of participation, right of maintenance or any similar right (whether pursuant to the certificate of incorporation or bylaws of the Company or any Acquired Company Contract or any statute to which any of the Acquired Companies is subject). None of the Acquired Companies is under any obligation, or is bound by any Contract pursuant to which it may become obligated, to repurchase, redeem or otherwise acquire any shares of Company Common Stock or capital with respect to which such Company Option is immediately exercisable; (iii) the date on which such Company Option was granted and the term of such Company Option; (iv) the vesting schedule for such Company Option; (v) the exercise price per share of Company Common Stock purchasable under such Company Option; and (vi) whether such Company Option has been designated an "incentive stock of any Subsidiary option" as defined in Section 422 of the Company or Code. Part 2.3(d) of the Disclosure Schedule accurately sets forth, with respect to provide each warrant issued to any funds to or make any investment in Person: (A) any Subsidiary the name of the Company that is not wholly-owned by the Company or holder of such warrant; (B) the total number of shares of Company Stock that are subject to such warrant; (C) the number of shares of Company Stock with respect to which such warrant is immediately exercisable; and (D) the term of such warrant. There is no: (i) outstanding subscription, option, call, convertible note, warrant or right (whether or not currently exercisable) to acquire any shares of the capital stock or other securities of the Company; (ii) except for the Company Preferred Stock, outstanding security, instrument or obligation that is or may become convertible into or exchangeable for any shares of the capital stock or other securities of the Company; (iii) Contract under which the Company is or may become obligated to sell or otherwise issue any shares of its capital stock or any other Personsecurities; or (iv) to the best of the knowledge of the Company, condition or circumstance that may give rise to or provide a basis for the assertion of a claim by any Person to the effect that such Person is entitled to acquire or receive any shares of capital stock or other securities of the Company. All outstanding shares of Company Stock and all outstanding Company Options, have been issued and granted in compliance with (i) all applicable securities laws and other applicable Legal Requirements, and (ii) all requirements set forth in applicable Contracts. The Company has never repurchased, redeemed or otherwise reacquired any shares of capital stock or other securities of the Company.

Capitalization, Etc. (a) The authorized capital stock of the Company consists of: (i) twenty-five million (25,000,000) of 150,000,000 shares of Company Common Stock, par value $.01 0.01 per share, of which 46,989,720 shares were issued and (ii) five million (5,000,000) outstanding as of April 16, 2007; and 5,000,000 shares of preferred stockPreferred Stock, par value $.01 0.01 per share, of which (1) 2,000,000 shares have been designated as Series X Junior Participating Preferred Stock and were reserved for issuance upon the exercise of rights granted under the Company Rights Agreement and (2) no shares have been issued or are outstanding. As of the date hereofApril 16, 2007: (i) 8,440,948 no shares of Company Common Stock were issued and outstanding, are held in the treasury of the Company; (ii) no shares of the Company’s preferred stock were issued or outstanding, (iii) no shares of capital stock of the Company were held in the Company’s treasury, (iv) 2,600,000 6,708,885 shares of Company Common Stock were reserved for are subject to issuance pursuant to stock options granted under the Amended 1989 Plan and Restated 1996 Incentive and Non-Incentive Stock Option the 1999 Plan (stock options granted by the Company pursuant to the 1989 Plan, the 1999 Plan or otherwise are referred to collectively herein as “1996 Stock Option PlanCompany Options”); (iii) and (v) 1,000,000 1,001,496 shares of Company Common Stock were are subject to issuance pursuant to the Company SARs granted under the 1999 Plan; (iv) 110,934 shares of Company Common Stock are subject to issuance pursuant to Company Stock Units held pursuant to the terms of the Deferred Compensation Plan; and (v) 1,221,972 shares of Company Common Stock are reserved for future issuance under pursuant to the Company’s 2005 Incentive Compensation PlanESPP. Except as set forth in this Section 2.3(a) as Of the shares of Company Common Stock, stock options, and Company SARs outstanding, 4,090,174 are subject to vesting under the terms of the date hereof, no shares of capital stock of 1999 Plan and the Company were authorized, issued, reserved for issuance or outstandingDirector Grant Plan. All of the outstanding shares of Company Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. There are no shares of Company Common Stock held by any of the Company’s Subsidiaries. None of the outstanding shares of Company Common Stock is are entitled or subject to any preemptive right, right of participation, right of maintenance or any similar right (whether pursuant or subject to the certificate any right of incorporation or bylaws first refusal in favor of the Company or any Acquired and, other than the ValueAct Voting Agreement, there is no Company Contract relating to the voting or registration of, or restricting any statute to which Person from purchasing, selling, pledging or otherwise disposing of (or granting any option or similar right with respect to), any shares of the Company Common Stock. No Acquired Companies is subject). None of the Acquired Companies Corporation is under any obligation, obligation or is bound by any Contract pursuant to which it may become obligated, obligated to repurchase, redeem or otherwise acquire any outstanding shares of Company Common Stock or Stock. The Company is not a party to any voting agreements with respect to any shares of capital stock of any Subsidiary of of, or other equity or voting interests in, the Company or any of its Subsidiaries other than the ValueAct Voting Agreement and, to provide any funds to or make any investment in (A) any Subsidiary the Knowledge of the Company that is not wholly-owned by Company, other than the Voting Agreements there are no irrevocable proxies and no voting agreements with respect to any shares of capital stock of, or voting interests in, the Company or any of its Subsidiaries. The “Separation Time” (Bas defined in the Company Rights Agreement) any other Personhas not occurred.