Common use of Board Representation Clause in Contracts

Board Representation. The Stockholders, collectively, shall have the right to designate either ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriate.

Board Representation. The Stockholders(a) Subject at all times to Sections 2(b) and 3(n) herein, collectively, shall have during the right to designate either ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election to the Company's board of directors by such board period beginning at the closing of the transactions contemplated by IPO until the Purchase Agreementearliest of (a) the twelfth anniversary of the date of the closing of the IPO; (b) such time as the Investors and their respective Affiliates no longer beneficially own, collectively, at least 6,250,000 Series C Shares or the equivalent of any successor securities issued upon conversion of such Series C Shares (including shares of voting common stock issued upon conversion of non-voting common stock issued upon conversion of the Series C Shares) (as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to such Series C Shares), or (c) following the third year anniversary of the IPO, such time as the Investors collectively hold less than 5% of the as-converted securities of the Company, the Company shall support the nomination of, and cause the Board of Directors (or the nominating committee thereof), subject to the requirements of fiduciary duties under applicable law, to serve until recommend and include in the next slate of nominees recommended to the Company’s stockholders for election as directors of the Company at each annual or special meeting of the Company’s stockholders of the Company. Thereafterat which directors are to be elected (an “Election Meeting”), if one (1) person designated at any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted time and from time to time to reflect increases, decreases or exchanges in, or by the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee mutual consent of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company Investors ((i) and (ii) above, the "Board Qualifications"an “Investor Designee”); provided that, the Company agrees shall have no obligation to support the nomination of or cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited include in the slate of nominees recommended to attend meetings of the Company's Board of Directors ’s stockholders for election as an observer (so long as he is either an employee directors of the Company or is subject to an Investor Designee if the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless Investors already have an Investor Designee serving as a director on the Board of Directors at the time of the Election Meeting and the term(s) of such Investor Designee(s) as a director on the Board of Directors does not expire at such Election Meeting. In the event that an Investor Designee resigns from his or her seat on the Board of Directors or is removed or otherwise fails to become or ceases to be a director for any reason, the vacancy will be filled by the election or appointment of another Investor Designee nominated by the Investors as soon as reasonably practicable in compliance with applicable laws, rules and regulations. The Investors will provide the Company, in writing, the information about any Investor Designee that is reasonably required by applicable law promptly after the Company requests such information from the Investors, and will cause any Investor Designee to submit on a timely basis to the Company a completed and executed questionnaire in the form that the Company provides to its outside directors generally. (b) Notwithstanding the provisions of Section 2(a), the Investors shall not be entitled to designate any person as a nominee to the Board of Directors if (i) a majority of the disinterested members of the Board of Directors reasonably and in good faith determines, after consultation with the Company’s outside legal counsel, that such person would not be qualified to serve as a director of the Company determines under any applicable law (including requirements of fiduciary duties under applicable law), rule or regulation, rule of the stock exchange on which the Company’s shares are listed, the Bylaws or any policy, or guidelines previously approved by the Board of Directors or (ii) such person is not approved for nomination by the Board of Directors (or the nominating committee thereof). The Company shall notify the Investors as soon as reasonably practicable of any objection to an Investor Designee pursuant to this Section 2(b) as to any particular meeting or meetings that considerations enable the Investors to propose a replacement Investor Designee in accordance with the terms of confidentiality make this Agreement. The Investors shall use reasonable best efforts to propose an Investor Designee sufficiently in advance of the date on which the proxy materials are to be mailed by the Company in connection with an Election Meeting to allow for inclusion of an Investor Designee in such attendance inappropriateproxy materials.

Board Representation. The Stockholders(a) From and after the Closing, collectivelyuntil such time as the Purchaser Parties collectively no longer Beneficially Own a number of shares of Purchased Shares equal to (i) at least 50% of the Purchased Shares received by the Purchaser pursuant to this Agreement (adjusted for subdivisions, stock-splits, combinations, recapitalizations or similar events, and provided that any shares of Common Stock issued upon conversion of shares of Preferred Stock shall have be treated as that number of shares of Preferred Stock with respect to which such shares of Common Stock was converted into), the right Purchaser shall be entitled to designate either two (2) persons, who shall be Partners, Managing Directors, Advisors or Principals of the Purchaser, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇& ▇▇▇▇, as they may choose, for election to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase AgreementLLC or their respective Affiliates (an “Affiliated Fund”), to serve until on the next annual meeting of Company Board (the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as “Purchaser Designees” and each a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction“Purchaser Designee”) and (ii) at least 25% (but less than 50%) of the Purchased Shares received by the Purchaser pursuant to this Agreement (adjusted for subdivisions, stock-splits, combinations, recapitalizations or similar events, and provided that any shares of Common Stock issued upon conversion of shares of Preferred Stock shall be treated as that number of shares of Preferred Stock with respect to which such shares of Common Stock was converted into), the Purchaser shall be entitled to designate one (1) Purchaser Designee. At such time that the Purchaser is either an employee no longer entitled to designate one or both Purchaser Designees pursuant to the previous sentence, the Purchaser shall promptly cause one or both Purchaser Designees, as applicable, to offer to resign from the Company Board. The Purchaser Designees shall initially be those persons named on Schedule 4.10 to this Agreement. A person that is a Purchaser Designee shall remain and be regarded as a Purchaser Designee for purposes of this Agreement for the remainder of such person’s term on the Company Board or, if earlier, death or resignation. The Company’s obligations to have any Purchaser Designee appointed to the Company Board or nominate any Purchaser Designee for election as a director at any meeting of the Company’s stockholders pursuant to this Section 4.10, as applicable, shall in each case be subject to such Purchaser Designee’s satisfaction of all requirements regarding service as a director of the Company or is subject to the noncompetition covenants of Article VII under applicable Law and stock exchange rules regarding service as a director of the Purchase Agreement Company. The Purchaser Parties will cause each Purchaser Designee to make himself or Section 7 herself reasonably available for interviews and to consent to such reference and background checks or other investigations and provide such information as the Company Board may reasonably request to determine the Purchaser’s Designee’s eligibility and qualification to serve as a director of the Employment Agreement of even date herewith between him Company Board. (b) From and after the Company ((i) and (ii) above, the "Board Qualifications")Closing, the Company agrees shall take such actions as are necessary to cause such Stockholder the Purchaser Designees to be included nominated as members of the Company Board and shall, subject to applicable Law, include in management's slate any proxy statement prepared, used, delivered or publicly filed by the Company to solicit the vote of nominees for election at each annual its stockholders in connection with any meeting of Company stockholders the recommendation of the Company Board that stockholders of the Company at vote in favor of the expiration Purchaser Designees and solicit votes in favor of his term, for so long as such Stockholder meets the election of the Purchaser Designees to Company Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet consistent with the Board QualificationsCompany’s efforts to solicit votes in favor of the election of the Company’s other nominees to the Company Board. (c) The Company, the Stockholders Purchaser and each Purchaser Designee shall choose one of them enter into a confidentiality and non-disclosure agreement on reasonably acceptable terms and which shall provide that a Purchaser Designee shall be permitted to be nominated for election to the Company's Board of Directors and the Company agrees to cause disclose confidential or non-public information received by such Stockholder so chosen to be included Purchaser Designee in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long its capacity as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Company Board of Directors to be invited to attend meetings representatives of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him Purchaser and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriateits Affiliates.

Board Representation. (a) As of the date hereof, the Board shall be comprised of six (6) directors. From and after the date hereof and for so long as Chesrown, or an Affiliate of Chesrown beneficially owns, in the aggregate, at least 1,000,000 shares of the issued and outstanding Common Stock (the “Minimum Threshold”), the Board shall be comprised of no more than six (6) directors, and Chesrown shall be entitled to (i) nominate three (3) individuals to the Board (such individuals, including their respective successors, the “Chesrown Directors”), to serve as members of the Board until their respective successors are elected and qualified, (ii) nominate any successor to each Chesrown Director, and (iii) direct the removal from the Board of any Chesrown Director; provided, that at least two of the Chesrown Directors shall be “independent” as defined by the applicable rules and regulations of the SEC and the NASDAQ stock market. The Stockholders, collectively, Chesrown Directors shall have the right to designate either ▇initially be Ma▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Mi▇▇▇ or ▇▇▇▇▇▇, and Ke▇▇▇ ▇▇▇▇▇▇▇▇. (b) Beginning with the first annual meeting of stockholders after the date hereof and thereafter, for so long as Chesrown or an Affiliate of Chesrown beneficially owns, in the aggregate, at least the Minimum Threshold, each nomination to the Board of any Chesrown Director for election at an annual meeting of stockholders of the Company shall be made by delivering to the Company a notice signed by Chesrown, which notice shall include the names and qualifications of such proposed Chesrown Directors. As promptly as practicable, the Company shall provide a copy of such notice to the Company’s Corporate Governance and Nominating Committee (the “Committee”), which shall, if the proposed Chesrown Director satisfies the criteria for qualifications of directors set forth in the Charter of the Committee (the “Charter”) in all material respects, as they may choosedetermined in good faith by the Committee, at the next Committee meeting at which Board nominees are determined for purposes of the Company’s annual meeting of stockholders, make a recommendation to the Board that such Chesrown Directors shall be nominated for election to the Board at the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of stockholders and shall, in the Company’s proxy statement relating to such annual meeting, recommend to the Company's stockholders that the stockholders should vote their Common Stock in favor of the election of the proposed Chesrown Directors. If the Committee reasonably determines in good faith that a proposed Chesrown Director does not meet such criteria, the Committee shall notify Chesrown of such fact within 10 days following receipt of the Chesrown Notice, specifying in reasonable detail the reasons for the determination that such criteria have not been met, and within 10 calendar days Chesrown may submit to the Committee a new proposed Chesrown Director. (c) For so long as Chesrown or an Affiliate of Chesrown beneficially owns, in the aggregate, at least the Minimum Threshold, each nomination to the Board of any Chesrown Director for election other than at an annual meeting of stockholders of the CompanyCompany (whether due to the resignation, removal or death of a Chesrown Director or otherwise) shall be made by delivering to the Company a notice signed by Chesrown, which notice shall include the names and qualifications of such proposed Chesrown Director. ThereafterAs promptly as practicable, the Company shall provide a copy of such notice to the Committee, which shall, if the proposed Chesrown Director satisfies the criteria for qualifications of directors set forth in the Charter in all material respects, as determined in good faith by the Committee, as promptly as practicable, make a recommendation to the Board that such Chesrown Directors shall be appointed for election to the Board, which appointment may be made by the Board to the extent permitted pursuant to the Company’s bylaws. As promptly as practicable thereafter, the Company shall take or cause to be taken such corporate actions as may be required to cause such appointment to be effected. If the Committee reasonably determines in good faith that such proposed Chesrown Director does not meet such criteria, the Committee shall notify Chesrown of such fact within 10 days of receipt of the Chesrown Notice, specifying in reasonable detail the reasons for the determination that such criteria have not been met, and within 10 calendar days Chesrown may submit to the Committee a new proposed Chesrown Director. (d) From and after the date hereof and for so long as Berrard, or an Affiliate of Berrard beneficially owns, in the aggregate, at least the Minimum Threshold, the Board shall be comprised of no more than six (6) directors, and Berrard shall be entitled to (i) nominate one individual to the Board (such individual, including such individual's successor, the “Berrard Director”), to serve as a member of the Board until the Berrard Director's successor is elected and qualified, (ii) nominate any one successor to the Berrard Director, and (iii) direct the removal from the Board of the Berrard Director. The Berrard Director shall initially be St▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ . (ie) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or Beginning with the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each first annual meeting of stockholders following the stockholders of the Company at the expiration of his termdate hereof and thereafter, for so long as such Stockholder meets Berrard, or an Affiliate of Berrard beneficially owns, in the aggregate, at least the Minimum Threshold, each nomination to the Board Qualificationsof any Berrard Director for election at an annual meeting of stockholders of the Company shall be made by delivering to the Company a notice signed by Berrard, which notice shall include the name and qualifications of the proposed Berrard Director. IfAs promptly as practicable, howeverthe Company shall provide a copy of such notice to the Committee which shall, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet if the proposed Berrard Director satisfies the criteria for qualifications of directors set forth in the Charter in all material respects, as determined in good faith by the Committee, at the next Committee meeting at which Board nominees are determined for purposes of the Company’s annual meeting of stockholders, make a recommendation to the Board Qualifications, the Stockholders that such Berrard Director shall choose one of them to be nominated for election to the Board at the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each next annual meeting of stockholders and shall, in the Company’s proxy statement relating to such annual meeting, recommend to the Company's Stockholders that the Stockholders should vote their Common Stock in favor of the election of the proposed Berrard Director. If the Committee reasonably determines in good faith that a proposed Berrard Director does not meet such criteria, the Committee shall notify Berrard of such fact within 10 days following receipt of the Berrard Notice, specifying in reasonable detail the reasons for the determination that such criteria have not been met, and within 10 calendar days Berrard may submit to the Committee a new proposed Berrard Director. (f) For so long as Berrard or an Affiliate of Berrard beneficially owns, in the aggregate, at least the Minimum Threshold, each nomination to the Board of any Berrard Director for election other than at an annual meeting of stockholders of the Company at (whether due to the expiration resignation, removal or death of his terma Berrard Director or otherwise) shall be made by delivering to the Company a notice signed by Berrard, which notice shall include the names and qualifications of such proposed Berrard Director. As promptly as practicable, the Company shall provide a copy of such notice to the Committee, which shall, if the proposed Berrard Director satisfies the criteria for qualifications of directors set forth in the Charter in all material respects, as determined in good faith by the Committee, as promptly as practicable, make a recommendation to the Board that such Berrard Director shall be appointed for election to the Board, which appointment may be made by the Board to the extent permitted pursuant to the Company’s bylaws. As promptly as practicable thereafter, the Company shall take or cause to be taken such corporate actions as may be required to cause such appointment to be effected. If the Committee reasonably determines in good faith that such proposed Berrard Director does not meet such criteria, the Committee shall notify Berrard of such fact within 10 days of receipt of the Berrard Notice, specifying in reasonable detail the reasons for the determination that such criteria have not been met, and within 10 calendar days Berrard may submit to the Committee a new proposed Berrard Director. (g) The Company shall include in the slate of nominees recommended by the Board for election as directors each Chesrown Director and the Berrard Director for so long as such Stockholder meets Chesrown and Berrard, respectively, are entitled to nominate the Board QualificationsChesrown Directors and the Berrard Director pursuant to this Agreement. FurtherEach of Berrard, for so long as Chesrown, and each of the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company covenants and agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of vote all Equity Securities held by such person or their Affiliate for the Company's Board of Directors election to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriateall individuals nominated in accordance with this Section 2.1.

Board Representation. (a) The StockholdersCompany shall take all permissible corporate action such that on the Closing Date the size of the Board shall be increased by one (1) member, collectively, shall have the right to designate either and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (“▇▇▇▇▇▇▇”) shall be appointed to the Board as a member of the class whose initial term expires at the 2016 annual meeting of the Company’s stockholders. (b) After the Closing, the size of the Board shall initially be set at ten (10) members. (c) Subject to Section 2(a), from and after the Closing Date, the Company shall cause ▇▇▇▇▇▇▇ or ▇▇▇▇ (or, if ▇▇▇▇▇▇▇ is unavailable to continue to serve on the Board, such other person designated by ▇, as they may choose, for election ▇▇▇▇▇▇ and reasonably acceptable to the Company's board ) to be nominated by the Company to serve on the Board (such director, the “Purchaser Designee”) for so long as the ▇▇▇▇▇▇▇ Family Foundation (or an Affiliate thereof) has beneficial ownership of Shares, Warrants or Warrant Shares, in the aggregate, in an amount equal to at least fifty percent (50%) of the Shares and Warrants issued to the ▇▇▇▇▇▇▇ Family Foundation on the Closing Date. In the event the ▇▇▇▇▇▇▇ Family Foundation (or an Affiliate thereof) no longer has beneficial ownership of Shares, Warrants or Warrant Shares in the amount set forth in this Section 3(c), the Company may cause the Purchaser Designee to be replaced with a nominee acceptable to the Company. (d) The Purchaser Designee shall, when up for election, subject to the terms hereof and applicable law, be the Company’s nominee to serve on the Board and the Company shall solicit proxies for the Purchaser Designee to the same extent as it would for any of its other nominees to the Board. The Company’s proxy statement for the election of directors by such board at shall include the closing Purchaser Designee and the recommendation of the transactions contemplated Board in favor of election of the Purchaser Designee. (e) For so long as such membership does not conflict with any applicable law or regulation or listing requirement of Nasdaq or other securities exchange on which the Common Stock is listed for trading (as determined in good faith by the Purchase AgreementBoard), the Purchaser Designee shall be entitled to serve until the next annual meeting as a member of, or observer to, at such Purchaser Designee’s election, committees of the stockholders Board. (f) ▇▇▇▇▇▇▇ may, and ▇▇▇▇▇▇▇ may request the Purchaser Designee to, as the case may be, resign, at any time with or without cause. Any vacancy caused by the resignation of the CompanyPurchaser Designee shall only be filled with another Purchaser Designee. Thereafter, if Any vacancy created by any one removal of the Purchaser Designee or an election of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ to defer appointing the Purchaser Designee shall also only be filled with another Purchaser Designee. The Company shall not take any action to remove the Purchaser Designee or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or fill a vacancy reserved for the distribution of additional or different securities Purchaser Designee in respect of, each case without the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ unless and ▇▇▇▇ until ▇▇▇▇▇▇▇ is not no longer entitled to the Purchaser Designee in accordance with Section 2(c) above. (g) In addition to any other indemnification rights the Purchaser Designee has pursuant to the Transaction Documents and the Company’s Certificate of Incorporation and Bylaws, the Purchaser Designee that serves on the Board shall have the right to enter into, and the Company agrees to enter into, an indemnification agreement, in a form reasonably satisfactory to the Purchaser Designee, concurrent with such Purchaser Designee becoming a member of the Company's Board Board. The Company shall maintain director and officer insurance covering the Purchaser Designee on the same terms and with the same amount of Directors coverage as is provided to be invited to attend other members of the Board. The Company shall reimburse the reasonable expenses incurred by the Purchaser Designee in connection with attending (whether in person or telephonically) all meetings of the Company's Board of Directors or committees thereof or other Company related meetings to the same extent as an observer (so long as he is either an employee all other members of the Company or is subject Board are reimbursed for such expenses (or, in case any such expense reimbursement policy shall apply only to non-employee directors, to the noncompetition covenants of Article VII of same extent as all other non-employee directors). The Purchaser Designee shall be entitled to the Purchase Agreement or Section 7 of same compensation for service on the Employment Agreement of even date herewith between him Board, including, without limitation, cash fees, stock options, deferred share units, restricted stock and other equity and equity-related awards, as is provided to other non-employee directors. (h) The Company and the Purchasers shall take or cause to be taken all lawful action necessary to ensure at all times as of and following the Closing Date that the Company), unless ’s Certificate of Incorporation and Bylaws are not inconsistent with the Board provisions of Directors of this Agreement and the Company determines as to any particular meeting Transaction Documents or meetings that considerations of confidentiality make such attendance inappropriatethe transactions contemplated hereby or thereby.

Board Representation. (a) The StockholdersBoard of Directors shall, collectivelyprior to the Closing, elect a total of four nominees designated in writing by the Investor (such persons, or replacements designated by the Investor, the "Board Nominees"), to the Board of Directors, to be allocated to Class I, Class II or Class III as specified by the Investor. Commencing with the annual meeting of stockholders of the Company the record date for which next follows the Closing Date, and at each annual meeting of stockholders of the Company thereafter, the Investor shall be entitled to present to the Board of Directors or the nominating committee thereof a number of nominees for election to the class of directors up for election to the Board of Directors at such annual meeting equal to the number of Board Nominees in such class immediately prior to such election and the Company shall use its best efforts to cause the election to the Board of Directors of such Board Nominees. If the Board of Directors shall cease to be a classified board, the Investor shall be entitled to present to the Board of Directors or the nominating committee thereof two nominees for election to the Board of Directors at each annual meeting of stockholders of the Company. In the event of the death, disability, resignation or removal of a Board Nominee, the Investor shall designate a replacement for such director, which replacement the Company shall cause to be elected to the Board of Directors. (b) The Company shall cause each Board Nominee designated for election to the Board of Directors pursuant to Section 5.02(a) to be included in the slate of nominees recommended by the Board of Directors to the stockholders of the Company for election as directors at the relevant annual meeting of the stockholders, and shall use its best efforts to cause the election of each such Board Nominee, including soliciting proxies in favor of the election of such person. (c) Notwithstanding the foregoing provisions of this Section 5.02, the Investor shall not be entitled to designate Board Nominees for election to the Board of Directors in the event that (i) less than $130,000,000 in Stated Value of the Series A Preferred Stock is outstanding or (ii) the Investor and its Affiliates do not Beneficially Own, in the aggregate, more than 50% of the then outstanding shares of Series A Preferred Stock. In the event that the Investor shall not be entitled to designate Board Nominees for election to the Board of Directors, the Board Nominees shall resign from the Board of Directors no later than the thirtieth day after the day on which the Investor becomes aware that the aggregate Beneficial Ownership of it and its Affiliates is reduced below the threshold ownership level of Original Number of Series A Shares specified in this Section 5.02(c). If a Board Nominee does not resign on or prior to such thirtieth day as required pursuant to the immediately preceding sentence, a majority of the Board of Directors (excluding any Board Nominees) shall have the right to designate either ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇remove such Board Nominee from the Board of Directors. (d) If the Board of Directors shall determine in good faith in the exercise of its fiduciary duties, as they may choose, that nomination of any person designated by the Investor for election to the Company's board Board of directors by such board at Directors would be contrary to the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders best interests of the Company. Thereafter, then the Company shall promptly notify the Investor of such determination (either in person, if any one such determination shall be made at a Board of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Directors meeting at which a Board Nominee is present or ▇▇▇▇ ▇▇▇▇▇▇▇ by telephone (i) holds promptly confirmed in writing), if such determination shall be made at least 400,000 shares a Board of Common Stock (Directors meeting at which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transactionBoard Nominee is not present) and (ii) is either an employee thereafter the Investor shall have a period of the Company or is subject no less than five Business Days to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees designate a new person for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated nomination for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the a Board Nominee. The Board of Directors has approved the executives of the Company determines Investor set forth on Schedule 5.02(d) as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriateBoard Nominees for all purposes hereof as the date hereof.

Board Representation. The Stockholders(a) At the Closing, collectivelythe Company shall appoint two Directors designated by the Investor Shareholders for election by the Board and obtain resignations from two of the Directors that are not Independent Directors serving on the Board such that the Board shall consist initially of seven Directors. During the Term of this Agreement, (i) the Investor Shareholders, acting as a group (by majority vote based on number of shares of Common Stock held), shall have the right to designate either ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, nominate for election to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject Board two Directors to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders Investor Shareholder Group collectively own in the aggregate not less than 800,000 owns of record a number of shares of Common Stock equal to at least 10% of the then outstanding Common Stock (which threshold the “Investor Directors”), (ii) the Existing Shareholders, acting as a group (by majority vote based on number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transactionheld), shall have the Company agrees right to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of nominate for election to the Company's Board of two Directors to be invited to attend meetings of the Company's Board of Directors as an observer (for so long as he is either an employee the Existing Shareholder Group collectively owns of record a number of shares of Common Stock equal to at least 10% of the Company or is subject then outstanding Common Stock (the “Existing Shareholder Directors”) and (iii) the Investor Directors and the Existing Shareholder Directors shall jointly nominate three Independent Directors. In addition, in the event that the Board (including at least one Investor Director and one Existing Shareholder Director) determines to increase the number of directors above seven, such additional directors shall be Independent Directors and shall be jointly nominated by the Investor Directors and the Existing Shareholder Directors. Any nomination for the replacement of (x) a Investor Director prior to the noncompetition covenants expiration of Article VII his or her respective term shall be made by the remaining Investor Director or, if no Investor Directors remain, by the Investor Shareholders, (y) an Existing Shareholder Director prior to the expiration of his or her respective term shall be made by the Purchase Agreement remaining Existing Shareholder Director or, if no Existing Shareholder Directors remain, by the Existing Shareholders or Section 7 (z) an Independent Director prior to the expiration of his or her respective term shall be made jointly by the Employment Agreement of even date herewith between him Investor Directors and the Company)Existing Shareholder Directors; provided, unless however, that the current independent Directors shall be entitled to serve through the earlier to occur of their resignation or the expiration of their respective current terms and; provided, further that to the extent that the Board of Directors of or any member thereof reasonably believes that it would be contrary to his, her or its fiduciary duties to the Company determines as and its shareholders to nominate any particular meeting Investor Director or meetings that considerations of confidentiality Existing Shareholder Director to the Board or any Committee thereof, the Board, or any member thereof, may refuse to make such attendance inappropriatenomination and such refusal shall not be deemed a breach of this Agreement.

Board Representation. (a) The StockholdersCompany will, collectivelywithin ten days following the execution of this Agreement, shall have the right to designate either cause ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election to be elected to the Company's board Board of Directors in the class of directors by such board with a term expiring at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the Company. Thereafter's shareholders to be held in 2000, and if any one of ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increasesor, decreases or exchanges in, or the distribution of if any additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) director is either an employee of the Company or is subject elected to the noncompetition covenants Company's Board of Article VII of Directors pursuant to the Purchase Agreement or Section 7 of next two sentences prior to the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders Company's shareholders to be held in 1999, such additional director) is not elected as a director at the annual meeting of the Company's shareholders to be held in 1999, then the Company at the expiration of his term, for so long as will promptly after such Stockholder meets the Board Qualificationsmeeting cause ▇▇. If, however, both ▇▇▇▇▇▇▇▇▇ (and such additional director, if applicable) to be elected to the Company's Board of Directors in such class of directors. At any time prior to March 1, 2000, ▇▇. ▇▇▇▇▇▇▇▇▇ may serve notice on the Company to the effect that the Shareholders desire to cause the election of an additional member to the Company's Board of Directors, which notice shall specify three individuals who are qualified to serve as members of the Company's Board of Directors and who are neither affiliates nor associates of any of the Shareholders (and who shall agree to resign as a member of the Board of Directors of the Company and NewCo (as defined below) if required by the terms of this Agreement and the NewCo Agreement (as defined below)). In such event, the Company will, within 20 days following receipt of such notice, cause one of such individuals to be elected to the Company's Board of Directors, with a term coincident with ▇▇. ▇▇▇▇▇▇▇▇▇'▇ term as a member of the Company's Board of Directors. If during the term of this Agreement the Company effects a spin-off or similar distribution to its shareholders of its Color Printing and Imaging Products business (such newly formed spun-off or distributed entity, "NewCo"), then (i) immediately prior to consummation of such spin-off or other distribution and subject to the entering into of a shareholder agreement among NewCo and the Shareholders on terms substantially identical to the terms of this Agreement (the "NewCo Agreement"), the Company will cause ▇▇. ▇▇▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for elected to NewCo's Board of Directors, with a term ending on the expiration of such shareholder agreement (and, if an additional director shall be elected to the Company's Board of Directors as provided above, such additional director shall be elected to NewCo's Board of Directors at the later of ▇▇. ▇▇▇▇▇▇▇▇▇'▇ election to NewCo's Board of Directors or such additional director's election to the Company's Board of Directors Directors, with a term coincident with ▇▇. ▇▇▇▇▇▇▇▇▇'▇ term as a member of NewCo's Board of Directors) And (ii) NewCo and the Company agrees Shareholders shall enter into the Newco Agreement prior to cause effecting such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of transaction. (b) If the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualificationselects not to nominate ▇▇. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇▇▇ (and, if applicable, the additional director referred to in paragraph (a) of this Section 4) for reelection to the Company's Board of Directors at the annual meeting of the Company's shareholders to be held in 2000 or the Company's Board of Directors determines that it does not wish ▇▇. ▇▇▇▇▇▇▇▇▇ and (or such additional director) to continue as a member thereof following the annual meeting of the Company's shareholders to be held in 2000, the Company shall serve notice on ▇▇. ▇▇ ▇▇▇▇▇▇▇▇ to such effect at least 20 days prior to the last day on which shareholders of the Company are entitled to give notice to the Company with respect to such meeting under the provisions of the Company's By-laws relating to shareholder nomination of directors. In the event that such notice is not given, ▇▇. ▇▇▇▇▇▇▇▇▇ (and any such additional director) may, at his election, serve written notice of his resignation as a member of the Company's Board of Directors (to be invited to attend meetings take effect immediately upon receipt of such notice by the Company), and if for any reason ▇▇. ▇▇▇▇▇▇▇▇▇ (or any such additional director) is a member of the Company's Board of Directors as an observer (so long as he is either an employee immediately following the annual meeting of the Company or is subject Company's shareholders to the noncompetition covenants be held in 2000 other than as a result of Article VII such person having been elected as a member of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the 's Board of Directors at such annual meeting, then such person shall immediately resign as a member of the Company determines as Company's Board of Directors. If ▇▇. ▇▇▇▇▇▇▇▇▇ and any such additional director resign following the giving of the notice referred to any particular meeting or meetings above and prior to the termination of this Agreement, then immediately upon the effectiveness of such resignations all provisions of this Agreement shall cease and be of no further force and effect, except that considerations the Ownership Cap Provision shall remain in full force and effect for 30 days following the date of confidentiality make effectiveness of such attendance inappropriateresignations.

Board Representation. (a) The StockholdersCompany shall, collectivelywithin 30 days after the date hereof, promptly cause one vacancy to be created on its Board of Directors (by increasing the number of members of the Board of Directors or otherwise) and at such time shall have cause one person designated by the right Purchaser and that is reasonably acceptable to designate either the Company to be selected to fill such vacancy; provided that each of T. ▇▇▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇▇ shall be deemed to be acceptable to the Company. Such designee shall serve until the next succeeding annual meeting of stockholders of the Company to be held after such election. Notwithstanding the foregoing, as they may chooseat any time that the Purchaser does not continue to own at least 20% of the shares of Class A Common Stock issued or issuable upon conversion of the Preferred Stock (whether or not the Preferred Stock has been converted), for election such designee shall tender his or her resignation to the Company's board Board of directors by such board Directors at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next succeeding annual meeting of the stockholders, whether or not such designee's term of office expires at such meeting. (b) Commencing with such next succeeding annual meeting of stockholders of the Company referred to in subsection (a) above and at each annual meeting of stockholders of the Company thereafter, so long as the Purchaser holds 20% of the shares of Class A Common Stock issued or issuable upon conversion of the Preferred Shares (whether or not the Preferred Shares have been converted) the Purchaser shall be entitled to designate one director who shall be acceptable to the Company to the Company. Thereafter, if any one 's Board of Directors; provided that each of T. ▇▇▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time deemed to time be acceptable to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee Company. The Company shall cause such designee of the Company or is subject Purchaser to be included in the slate of nominees recommended by the Board to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him Company's stockholders for election as directors, and the Company shall use its reasonable best efforts to cause the election of such designee, including voting all shares for which the Company holds proxies (unless otherwise directed by the stockholder submitting such proxy) or is otherwise entitled to vote, in favor of the election of such person. Notwithstanding the foregoing, at any time that the Purchaser does not continue to own at least 20% of the shares of Class A Common Stock issued or issuable upon conversion of the Preferred Stock (iwhether or not the Preferred Stock has been converted), such designee shall tender his or her resignation to the Company's Board of Directors at the next succeeding annual meeting of stockholders, whether or not such designee's term of office expires at such meeting. (c) and (iiIn the event such designee of the Purchaser shall cease to serve as a director for any reason, other than by reason of the Purchaser not being entitled to designate a designee as provided in Section 1(a) above, the "Board Qualifications"or 1(b), the Company agrees shall use its reasonable best efforts to cause such Stockholder the vacancy resulting thereby to be included in management's slate of nominees for election at each annual meeting filled by a designee of the stockholders Purchaser that is reasonably acceptable to the Company; provided that each of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both T. ▇▇▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet shall be deemed to be acceptable to the Company. (d) In addition to the rights granted pursuant to Section 1(a), (b) and (c) above, the Purchaser shall have the right to have a representative reasonably acceptable to the Company attend all portions of regular and special meetings of the Board Qualificationsof Directors of the Company not reserved for members of the Board of Directors of the Company only except to the extent counsel to the Company advises that such attendance or receipt of information thereat could jeopardize matters of attorney-client privilege or otherwise not be in the Company's best interests as a whole. Such representative shall agree in writing at the time of his or her designation that he or she shall be bound by the same fiduciary duties (including those relating to confidentiality) as apply to members of the Board. Such right is further conditioned upon the receipt of an agreement in writing pursuant to which such representative agrees to keep confidential all discussions held, and materials distributed, at the Stockholders shall choose one meeting of them to be nominated for election to the Company's Board of Directors Directors. The visitation rights set forth above shall include the right to receive the same notice and materials provided to Board and committee members. For the Company agrees to cause such Stockholder so chosen to be included in management's slate avoidance of nominees for election at doubt, it is understood and agreed that each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of T. ▇▇▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇ shall be deemed acceptable to the Company for purposes of this Section 1(d). (e) From and after the date hereof and so long as the Purchaser continues to hold at least 20% of the shares of Class A Common Stock issued or issuable upon conversion of the Preferred Stock (whether or not the Preferred Stock has been converted), at each annual or special stockholders meeting called for the election of directors, and whenever the stockholders of the Company act by written consent with respect to the election of directors, MBF agrees to vote or otherwise give such stockholder's consent in respect of all shares of the capital stock of the Company (whether now or hereafter acquired) owned (whether jointly or severally) or, to the extent permitted by law, controlled (including shares held by the Estate of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (until distributed in accordance with Section 2(f)), but excluding shares held by the Overlook Estate Foundation, Inc. or the ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Family Trust) by such stockholder, and take all other appropriate action, in order to cause: (i) the election to the Board of Directors of the designee of the Purchaser pursuant to this Section 1; (ii) the removal from the Board of Directors (with or without cause) of any director elected in accordance with clause (i) above upon the written request of the Purchaser; and (iii) upon any vacancy in the Board as a result of any individual designated as provided in clause (i) above ceasing to be a member of the Board of Directors, whether by resignation or otherwise, the election to the Board of Directors as promptly as possible of an individual designated by the Purchaser that is reasonably acceptable to the Company; provided that each of T. ▇▇▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of shall be deemed to be acceptable to the Company's Board of Directors . (f) No party hereto shall grant any proxy or enter into or agree to be invited bound by any voting trust with respect to attend meetings shares of the Company's Board capital stock held by it, nor shall any party hereto enter into any stockholder agreement or arrangement of Directors as an observer (so long as he is either an employee any kind with respect to shares of the Company capital stock held by it, which conflicts or is subject to inconsistent in any manner with the noncompetition covenants provisions of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriatethis Agreement.

Board Representation. The Stockholders(a) As of the Closing Date and during the Standstill Period the Board of Directors shall consist of no more than twelve (12) directors as follows: (A) two directors shall be executive officers of the Company; (B) up to two directors, collectivelyas determined pursuant to SECTIONS 3.1(B) and 3.1(C), shall be Shareholder Designees; (C) for so long as required under the Stock Purchase Agreement dated as of September 17, 1996, as the same may be amended (the "▇▇▇▇▇▇▇ AGREEMENT"), by and among the Company, Allied Holding (United States), Inc., a Delaware corporation, ▇▇▇▇▇▇▇, Inc., a Canadian corporation ("▇▇▇▇▇▇▇"), and certain of ▇▇▇▇▇▇▇'▇ subsidiaries, two directors as shall be designated in accordance with the ▇▇▇▇▇▇▇ Agreement; and (D) each other director shall be an individual who is not a partner, employee, director, officer or affiliate of any Shareholder or any employee or officer of the Company; PROVIDED, HOWEVER, that if ▇▇. ▇'▇▇▇▇▇ ceases to serve as a director, the Board of Directors shall thereafter consist of no more than eleven (11) directors during the Standstill Period. For so long as Shareholders are entitled to two Shareholder Designees under this Agreement, Shareholders shall be entitled to have one Shareholder Designee serve on each committee of the right Board of Directors other than any committee formed for the purpose of considering matters relating to designate either the Shareholders. (b) On the Closing Date, the Company will cause ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ meet or, subject to SECTION 3.1(D), such other substitute persons as may be designated by Shareholders and be reasonably acceptable to the Company, to be elected to the Board Qualificationsof Directors. Until the earlier to occur of the sixth anniversary of the Closing Date and the date on which Shareholders own, collectively, less than 20% of the Shares (the "SHAREHOLDER DESIGNEE PERIOD"), the Stockholders Company agrees, subject to SECTION 3.1(D), to support the nomination of, and the Company's nominating committee (or any other committee exercising a similar function) shall choose recommend to the Board of Directors that, (A) two Shareholder Designees, so long as Shareholders beneficially own 50% or more of the Shares and (B) one Shareholder Designee, so long as Shareholders beneficially own 20% or more and less than 50% of them the Shares (each a "BENEFICIAL OWNERSHIP THRESHOLD"), be included in the slate of nominees recommended by the Board of Directors to be nominated shareholders for election as directors at each annual meeting of shareholders of the Company commencing with the next annual meeting of shareholders. Notwithstanding the foregoing, if at any time as a result of the Company's issuance of Voting Securities Shareholders beneficially own 9% or less of the Actual Voting Power (the "ACTUAL VOTING POWER THRESHOLD"), Shareholders shall be entitled to no more than one Shareholder Designee. In the event that any of the Shareholder Designees shall cease to serve as a director for any reason, the Board of Directors shall fill the vacancy resulting thereby, subject to the terms of this Agreement, with a person designated by Shareholders, subject to SECTION 3.1(D) (and such person shall be a "Shareholder Designee" for purposes of this Agreement). The foregoing provision shall be effected pursuant to an amendment to the Company's By-laws in a form reasonably acceptable to the parties to this Agreement which shall not be further amended by the Board of Directors during the Shareholder Designee Period. Notwithstanding the foregoing, the Company shall have no obligation to support the nomination, recommendation or election of any Shareholder Designee pursuant to this SECTION 3.1(B) if Shareholders are in breach of any material provision of this Agreement. (c) Upon any decrease in Shareholders' beneficial ownership of Common Stock below any Beneficial Ownership Threshold or Voting Securities below the Actual Voting Power Threshold, Shareholders shall cause a number of Shareholder Designees to offer to immediately resign from the Company's Board of Directors such that the number of Shareholder Designees serving on the Board of Directors immediately thereafter will be equal to the number of Shareholder Designees which Shareholders would then be entitled to designate under SECTION 3.1(B). Upon termination of the Shareholder Designee Period, Shareholders shall promptly offer to cause all of the Shareholder Designees to resign from the Board of Directors and any committees thereof and the Company's obligations under this SECTION 3.1 shall terminate. (d) Notwithstanding the provisions of this SECTION 3.1, Shareholder shall not be entitled to designate any person to the Company's Board of Directors and (or any committee thereof) in the event that the Company agrees receives a written opinion of its outside counsel that a Shareholder Designee would not be qualified under any applicable law, rule or regulation to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock serve as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee director of the Company or if the Company objects to a Shareholder Designee because such Shareholder Designee has been involved in any of the events enumerated in Item 2(d) or (e) of Schedule 13D or such person is currently the target of an investigation by any governmental authority or agency relating to felonious criminal activity or is subject to any order, decree, or judgment of any court or agency prohibiting service as a director of any public company or providing investment or financial advisory services and, in any such event, the noncompetition covenants Shareholder shall withdraw the designation of Article VII such proposed Shareholder Designee and designate a replacement therefor (which replacement Shareholder Designee shall also be subject to the requirements of this Section). The Company shall use its reasonable best efforts to notify the Shareholder of any objection to a Shareholder Designee sufficiently in advance of the Purchase Agreement or Section 7 date on which proxy materials are mailed by the Company in connection with such election of directors to enable the Employment Agreement Shareholder to propose a replacement Shareholder Designee in accordance with the terms of even date herewith between him and the Company), unless this Agreement. (e) Each Shareholder Designee serving on the Board of Directors shall be entitled to all compensation and stock incentives granted to directors who are not employees of the Company determines as on the same terms provided to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriatedirectors.

Board Representation. The Stockholders(i) At and immediately after the Closing, collectively, the Board shall have ten directors, divided into three classes. One member of the right Board shall initially be designated by the Shareholder to designate either be a Class II director with a three year term from the date of the Company’s most recent annual meeting of stockholders (the “Shareholder Nominee”). Unless the Shareholder expressly agrees in writing, the Company shall use its best efforts to ensure that the Shareholder Nominee is not removed without cause. (ii) The Shareholder acknowledges that pursuant to a separate agreement between the Company and FIS, up to four directors shall be designated by FIS and that pursuant to a separate agreement between the Company and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election to the Company's board of two directors shall be designated by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ . ▇▇▇▇▇▇▇ ▇▇▇. (iiii) holds If, at least 400,000 shares any time following the election of Common Stock (which threshold number the Shareholder Nominee and prior to the third anniversary of shares shall automatically be adjusted from time to time to reflect increasesthe Closing Date, decreases or exchanges in, or a vacancy exists in the distribution office of additional or different securities in respect ofthe Shareholder Nominee, the Common Stock as Shareholder will be entitled to designate a result successor and, in connection with any subsequent meeting of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee the shareholders of the Company or the Board at which such vacancy is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications")be filled, the Company agrees will use its best efforts to cause such Stockholder the successor to be included so elected. Notwithstanding anything to the contrary contained herein, upon the earlier to occur of the following: (x) the date on which the Shareholder and its affiliates own less than one million shares of Common Stock; and (y) the date that is three years from the anniversary of the Closing Date, the Shareholder’s right to designate the Shareholder Nominee shall cease and, upon notice from the Company to the Shareholder, the Shareholder shall cause the Shareholder Nominee to immediately resign. The Shareholder Nominee, upon election as a director, will receive standard board fees, perquisites, expense reimbursements and option grants, in management's slate accordance with the Company’s policy of nominees for election paying directors, as such policy may be in effect from time to time. (iv) For so long as Shareholder and its affiliates own directly or indirectly at least one million shares of Common Stock, and there is no nominee of the Shareholder or its affiliates then serving as a director of the Company, the Shareholder will have the right to designate one person to attend meetings of the Board as a non-voting observer (the “Shareholder Observer”). Such Shareholder Observer will have the right to receive notice of and attend and participate in discussions at each annual regular and special meeting of the stockholders Board and will be entitled to receive at the same time they are provided to the Board copies of any information concerning the Company that is provided to the Company’s directors. Such Shareholder Observer will be bound by the same duties and obligations of loyalty and confidentiality with respect to such information as the directors of the Company. (v) From the Closing and continuing until the earliest of (x) the date that is five years after the Closing Date, (y) the date FIS and its affiliates no longer beneficially own (as defined in Rule 13d-3 and 13d-5 under the Exchange Act) more than 10% of the outstanding shares of any class of capital stock of the Company which are entitled to vote generally in the election of directors, and (z) the Shareholder and its affiliates do not own at least one million shares of Common Stock, the expiration Shareholder agrees that it and its affiliates: (a) with respect to any proposal submitted to the Company’s shareholders regarding the election of his termdirectors, for so long as such Stockholder meets will vote all Common Stock which they have the Board Qualifications. Ifright to vote in favor of the nominees designated by the Company’s directors other than the directors designated by FIS and its affiliates, however, both ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is his affiliates, and the Shareholder and its affiliates (the “Public Directors”); (b) with respect to any proposal to amend the Company’s Articles of Incorporation or Bylaws, will vote all Common Stock which they have the right to vote against any such proposal that has not been approved by a member majority of the Public Directors; (c) will not, and will cause its affiliates not to, call, or support (by way of giving a proxy or written consent) any person in seeking to call, any special meeting of the Company's Board ’s shareholders; (d) will not, and will cause its affiliates not to, seek or vote to remove or support (by way of Directors giving a proxy or written consent) any person in seeking to be invited to attend meetings remove, without cause, any member or members of the Board; (e) will not solicit, obtain, hold or vote the written proxies of any other shareholders of the Company's Board ; (f) will not enter into any binding agreement, arrangement or understanding with any other person jointly to take or cause such other person to take any action which would, if done by the Shareholder or its affiliates, result in a violation of Directors as an observer clauses (so long as he c), (d) or (e) of this Section 5(i)(v); and (g) will not publicly announce that it is either an employee seeking a waiver of any of the Company or is subject to the noncompetition covenants provisions of Article VII of the Purchase Agreement or this Section 7 of the Employment Agreement of even date herewith between him and the Company5(i)(v), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriate.

Board Representation. (a) The StockholdersCompany, collectivelysubject to its fiduciary duties under applicable state law, and each of the Stockholders agree and acknowledge that JEDI and/or its Permitted Transferees (defined below) shall have the right to designate either ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇right, as they may chooseexercisable at any time and acting alone (or, for election to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreementif more than one, in concert with each other), to serve until the next annual meeting elect one or more members of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as determined below, until such time (the "Termination Date") as JEDI and/or its Permitted Transferees have transferred in the aggregate 1,340,405 shares of Common Stock to one or more persons other than Permitted Transferees. The number of directors that JEDI and/or its Permitted Transferees shall be entitled to elect shall be that number of directors that represents a percentage of the entire Board of Directors at the time of election that is as close as possible to the percentage of outstanding shares of Common Stock then held collectively by JEDI and/or its Permitted Transferees. In calculating that percentage, the number of outstanding shares of Common Stock held by JEDI and/or its Permitted Transferees shall not exceed 1,340,405 shares less any particular number of shares theretofore transferred by JEDI and/or its Permitted Transferees to one or more persons other than Permitted Transferees. In no case before the Termination Date shall JEDI and/or its Permitted Transferees be entitled to elect less than one director. Any director elected by JEDI and/or its Permitted Transferees pursuant to this Section 1 may be removed only by JEDI and/or its Permitted Transferees and any vacancy resulting from the resignation, removal or death of any director elected by JEDI and/or its Permitted Transferees may be filled only by JEDI and/or its Permitted Transferees, and neither the Company nor any Stockholder other than JEDI and/or its Permitted Transferees shall take any action to remove any such director or fill any such vacancy. (b) In order to facilitate the rights of JEDI and/or its Permitted Transferees set forth in paragraph (a) of this Section 1, each of the Stockholders other than JEDI hereby grants to JEDI its proxy, which (being coupled with an interest) shall be irrevocable, to take any of the following actions, either by written consent or at a meeting of the Company's stockholders: (i) to elect the number of directors that JEDI and/or its Permitted Transferees are entitled to elect pursuant to paragraph (a) of this Section 1; (ii) to remove a director elected by JEDI and/or its Permitted Transferees; and (iii) to fill any vacancy on the Board of Directors resulting from the removal, resignation or meetings that considerations death of confidentiality make such attendance inappropriatea director elected by JEDI and/or its Permitted Transferees. The proxy granted hereby shall terminate upon the termination of JEDI's and/or its Permitted Transferees's right to elect directors pursuant to paragraph (a) of this Section 1.

Board Representation. The StockholdersIn connection with the Asset Purchase Agreement and the agreement of Purchaser to the transfer of certain material agreements to the Company from PetStore, collectivelythe Company hereby acknowledges that as of the date of this Agreement (i) the authorized size of the Board of Directors of the Company is five members, shall have (ii) the right to designate either members of the Board of Directors are Juli▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇hn ▇. ▇▇▇▇▇▇▇▇, ▇▇rk ▇. ▇▇▇▇▇▇ ▇▇▇ John ▇▇▇▇▇ or ▇▇▇▇ ▇. ▇▇▇▇▇▇, as they may choose(▇ii) there is one vacancy on the Company's Board of Directors, and (iv) the Company's By-laws authorize Board members to fill vacancies on the Board of Directors without shareholder approval. The Company hereby agrees that on the Closing Date, the Company's Board of Directors will fill the vacancy on the Board with the Purchaser's designee who shall be Michela English or such other reasonable candidate (who shall be at the level of senior vice president of Purchaser or higher) designated by the Purchaser ("Purchaser Designee") and that the Purchaser Designee shall have all the rights associated with being a Board member, including but not limited to, the right to vote at meetings of the Board; and that at the Company's next annual meeting of shareholders, the Purchaser Designee shall be included in the Company's slate of nominees for election to the Company's board of directors by such board Board at the closing meeting of shareholders. The Company will also obtain prior to Closing a voting agreement reasonably satisfactory to Purchaser and effective as of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting Closing from a majority of the stockholders holders of its voting stock (determined based on the number of shares of voting stock outstanding after Closing) under which such holders will agree to vote all shares of the Company's voting stock held by them at each annual and special meeting at which directors of the Company are to be elected to appoint the Purchaser Designee to the Company's Board of Directors. ThereafterThe voting agreement will terminate on the earlier of (i) the date on which the Tenancy and Promotion Agreement entered into between the Company and Purchaser as of the same date as this Agreement is terminated, if any one (ii) the date on which Purchaser has transferred, sold or otherwise disposed of ▇▇▇▇more than twenty-five percent (25%) of the shares of Pets.▇▇▇ ▇▇▇mon Stock originally acquired by it from Pets▇▇▇▇ or ▇.▇▇▇, ▇▇c. upon distribution, if any, of those shares of Pets.▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common mon Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both received by Pets▇▇▇▇.▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet er the Board QualificationsAsset Purchase Agreement, excluding for the Stockholders shall choose one purposes of them this calculation any shares Purchaser has pledged to be nominated for election to Imperial Creditcorp, Inc.under a guarantee agreement, or (iii) the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting consummation of the stockholders sale of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases all or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member substantially all of the Company's Board assets or a merger, reorganization or other recapitalization or transaction or series of Directors to be invited to attend meetings of related transactions in which the Company's Board of Directors as an observer (so long as he is either an employee stockholders prior to such transaction hold less than 50% of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriatevoting power.

Board Representation. The Stockholders, collectively, 7.1 OSI shall have the right to designate either ▇one nominee (who shall be reasonably satisfactory to the Company, provided that Mr. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election is deemed satisfactory to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ ) (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board QualificationsNominee"), the Company agrees to cause such Stockholder to be included in management's slate of nominees ) for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors within 30 days after the Closing Date and the Company and will use its best efforts to cause such Nominee to be invited elected as a director of the Company and re-elected (to attend meetings the extent required by this Section 7). Such best efforts shall include (a) nomination of the Nominee for election as a director of the Company in any solicitation of proxies or other communication to shareholders regarding the nomination of persons for election as the Company's directors; and (b) in any solicitation of proxies or other communication to shareholders regarding the nomination of persons for election as the Company's directors, nominating a number of nominees not greater than the number of seats on the Company's Board of Directors open for election in the applicable election. The Company's obligations under this Section 7 are subject to the Nominee completing and executing a Consent to Act as an observer a Director and personal information forms in the forms required by the TSX Venture Exchange. In the event that the TSX Venture Exchange does not approve the Nominee as a director of the Company, OSI will cause the Nominee to resign as a director of the Company. 7.2 If, at any time prior to the 2003 annual meeting of the Company's shareholders, OSI sells any of its Shares, Warrants and/or Warrant Shares, OSI shall no longer have the right to designate a nominee for election as a director of the Company. Except as set forth in the preceding sentence, if OSI holds more than 750,000 of the Shares and Warrant Shares (so long including Warrant Shares issuable upon exercise of the Warrants), OSI shall have the right to designate a nominee for election as he is either an employee a director of the Company or is subject to at the noncompetition covenants Company's annual meeting of Article VII shareholders, provided that this right shall terminate immediately after the 2006 annual meeting of the Purchase Agreement or Section 7 of Company's shareholders, provided further that OSI shall continue to have the Employment Agreement of even date herewith between him rights the provided by applicable law and the Company), unless 's charter and bylaws to holders of Common Shares to nominate and vote upon the Board election of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriatedirectors.

Board Representation. The StockholdersAt each annual meeting of the stockholders of the Company, collectivelyor at any meeting of the stockholders of the Company at which members of the Board of Directors of the Company are to be elected, or whenever members of the Board of Directors are to be elected by written consent, the Common Holders and the Investors agree to vote or act with respect to their shares so as to elect: (a) one (1) member of the Company's Board of Directors designated by Atlas Venture Fund V, L.P. or its affiliates ("Atlas") so long as Atlas owns at least 3,000,000 shares of Series A Preferred Stock (as adjusted for stock splits, stock dividends, reclassifications and the like), and such designee shall have initially be ▇▇▇▇▇ ▇▇▇▇▇▇▇▇; (b) one (1) member of the right to designate either Company's Board of Directors designated by Madrona Venture Group or its affiliates ("Madrona") so long as Madrona owns at least 3,000,000 shares of Series A Preferred Stock (as adjusted for stock splits, stock dividends, reclassifications and the like), and such designee shall initially be ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇; (c) one (1) member of the Company's Board of Directors designated by Sequoia Capital or its affiliates ("Sequoia") so long as Sequoia owns at least 3,000,000 shares of Series B Preferred Stock (as adjusted for stock splits, stock dividends, reclassifications and the like), and such designee shall initially be ▇▇▇▇ ▇▇▇▇▇▇; (d) one (1) member of the Company's Board of Directors designated by ▇▇▇▇▇▇ Brothers Venture Capital Group or its affiliates ("▇▇▇▇▇▇") so long as ▇▇▇▇▇▇ owns at least 3,000,000 shares of Series C Preferred Stock (as adjusted for stock splits, stock dividends, reclassifications and the like), and such designee shall initially be ▇▇▇▇▇ ▇▇▇▇; (e) one (1) member of the Company's Board of Directors designated by the holders of a majority of the Common Stock of the Company, and such designee shall initially be ▇▇▇▇▇ ▇▇▇▇▇; (f) one (1) member of the Company's Board of Directors to be an individual holding the title of Chief Executive Officer of the Company, for so long as such person remains Chief Executive Officer of the Company, and such designee shall initially be ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election to ; and (g) one (1) independent member of the Company's board Board of directors Directors designated by such board at the closing holders of a majority of the transactions contemplated by Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, Series E Preferred Stock and the Purchase AgreementCommon Stock, to serve until the next annual meeting of the stockholders of the Company. Thereaftervoting together as a single class on an as-converted basis, if any one of and such designee shall initially be ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriate.

Board Representation. The Stockholders, collectively, shall have (a) From the right to designate either ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election to the Company's board of directors by such board Closing Date -------------------- until XL no longer owns at the closing least 20% of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting principal amount of the stockholders outstanding Debentures, (x) the Company shall cause all of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ XL Designees (ias defined below) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders directors of the Company at the expiration Company's next stockholders' meeting and the Company shall support and use its best efforts to cause the election of his termsuch individuals to the board of directors of the Company and (y) XL shall have the right to request, for so long as and upon such Stockholder meets request the Board QualificationsCompany shall cause, the XL Designees to be elected to serve on the boards of directors of each of the Company's direct and indirect Subsidiaries. FurtherIn addition, for so long as all such XL Designees will be permitted to serve on any committees, including any executive committee of the Stockholders collectively own board of directors of the Company and each Subsidiary, unless such XL Designee is not qualified therefor under applicable law, rule or regulation, in which event XL shall have the aggregate not less than 800,000 right to select one individual to observe all such meetings in substitution therefor. "XL Designees" shall mean a number of individuals designated by XL equal to the greater of (x) two and (y) the number derived from multiplying the number of seats on the applicable board of directors times a fraction the numerator of which is the number of shares of Common Stock of the Company owned by XL (assuming conversion of all Debentures held by XL) and the denominator of which threshold is the number of outstanding shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as of the Company on a result Fully Diluted Basis (rounding up in the case of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transactionfractions), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ . At any time while an XL Designee is not a member of the Company's Board and each such Subsidiary's boards of Directors to be invited directors, at the sole discretion of XL, XL may appoint a representative of XL, and the Company and each such Subsidiary will permit such representative, to attend all meetings of the Company's Board boards of Directors as an observer (so long as he is either an employee directors of the Company and each such Subsidiary and any committees thereof. XL will continue to have the right to designate the XL Designees for election or is subject appointment to the noncompetition covenants boards of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors directors of the Company determines as to and each such Subsidiary in lieu of any particular meeting or meetings that considerations representative of confidentiality make such attendance inappropriateXL.

Board Representation. The StockholdersUntil the date on which less than twenty five percent (25%) of the number of Series B Preferred Stock remain outstanding or the Investors hold less than fifteen percent (15%) of the Company's then outstanding capital stock (not including any capital stock issuable upon exercise of outstanding options or warrants of the Company) (the "THRESHOLD DATE"), collectivelythe Investors agree to vote or act with respect to their shares of Series B Preferred Stock so as to elect as a Series B Director an individual designated by JAFCO America Ventures, Inc. (or its affiliates) (the "JAFCO ENTITIES"), the designee of which shall have be ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇. Until the right Threshold Date, the Investors agree to designate either vote or act with respect to their shares so as to elect as a Series B Director an individual designated by Doll Capital Management (the "DOLL CAPITAL ENTITIES"), the designee of which shall be ▇▇▇▇▇ ▇▇▇▇. From and after the Threshold Date, the Investors agree to vote or act with respect to their shares of Series B Preferred Stock so as to elect as a Series B Director, an individual designated by the JAFCO Entities. During the term of this Agreement, the Founders agree to vote or act with respect to their shares of Common Stock so as to elect the Company's then-current Chief Executive Officer as a Common Director; PROVIDED, HOWEVER, that until such time as a Chief Executive Officer is appointed, the Founders agree to vote or act with respect to their shares of Common Stock so as to elect ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ as a Common Director. During the term of this Agreement, the Founders agree to vote or act with respect to their shares of Common Stock so as to elect a designee of the holders of a majority of the outstanding shares of Common Stock as a Common Director, the designee of which shall be ▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇▇▇. Racotek, as they may choosethe sole holder of Series A Preferred Stock, for election agrees to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the Company. Thereafter, if any one of ▇elect ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ as the Series A Director. During the term of this Agreement, the parties to this Agreement agree to vote or act with respect to their shares so as to elect as the Independent Directors individuals with relevant experience in the Company's industry, which persons shall be unanimously designated by the Company's Board of Directors, one of which shall initially be ▇▇▇ ▇▇▇▇▇. However, if the JAFCO Entities, the Doll Capital Entities, the Founders or Racotek designate a person to serve as a director other than ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases▇▇▇▇, decreases ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet , as the Board Qualificationscase may be, then the person so designated shall be subject to the reasonable approval of a majority of the directors of the Company then serving in such capacity, which directors shall not include the director or directors of the Company that is, or was, serving as the previous designee of the JAFCO Entities, the Stockholders shall choose one of them to be nominated for election to Doll Capital Entities, the Founders or Racotek on the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his termDirectors, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriatecase may be.

Board Representation. (a) The StockholdersCompany, collectivelysubject to its fiduciary duties under applicable state law, and each of the Stockholders agree and acknowledge that JEDI and/or its Permitted Transferees (defined below) shall have the right to designate either ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇right, as they may chooseexercisable at any time and acting alone (or, for election to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreementif more than one, in concert with each other), to serve until the next annual meeting elect one or more members of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as determined below, until such time (the "Termination Date") as JEDI and/or its Permitted Transferees have transferred in the aggregate 1,340,405 shares of Company Stock to one or more persons other than Permitted Transferees. The number of directors that JEDI and/or its Permitted Transferees shall be entitled to elect shall be that number of directors that represents a percentage of the entire Board of Directors at the time of election that is as close as possible to the percentage of outstanding shares of Common Stock then held collectively by JEDI and/or its Permitted Transferees. In calculating that percentage, the number of outstanding shares of Common Stock held by JEDI and/or its Permitted Transferees shall not exceed 1,340,405 shares less any particular number of shares theretofore transferred by JEDI and/or its Permitted Transferees to one or more persons other than Permitted Transferees. In no case before the Termination Date shall JEDI and/or its Permitted Transferees be entitled to elect less than one director. Any director elected by JEDI and/or its Permitted Transferees pursuant to this Section 1 may be removed only by JEDI and/or its Permitted Transferees and any vacancy resulting from the resignation, removal or death of any director elected by JEDI and/or its Permitted Transferees may be filled only by JEDI and/or its Permitted Transferees, and neither the Company nor any Stockholder other than JEDI and/or its Permitted Transferees shall take any action to remove any such director or fill any such vacancy. (b) In order to facilitate the rights of JEDI and/or its Permitted Transferees set forth in paragraph (a) of this Section 1, each of the Stockholders other than JEDI hereby grants to JEDI its proxy, which (being coupled with an interest) shall be irrevocable, to take any of the following actions, either by written consent or at a meeting of the Company's stockholders: (i) to elect the number of directors that JEDI and/or its Permitted Transferees are entitled to elect pursuant to paragraph (a) of this Section 1; (ii) to remove a director elected by JEDI and/or its Permitted Transferees; and (iii) to fill any vacancy on the Board of Directors resulting from the removal, resignation or meetings that considerations death of confidentiality make such attendance inappropriatea director elected by JEDI and/or its Permitted Transferees. The proxy granted hereby shall terminate upon the termination of JEDI's and/or its Permitted Transferees's right to elect directors pursuant to paragraph (a) of this Section 1.

Board Representation. The Stockholders(a) Subject to Section 2.2 hereof, collectivelyat and following the Effective Date, shall have each party to this agreement will take such action as may reasonably be in its power to cause the right Board to designate either include (i) six (6) Investor Group Designees, one (1) of whom, unless and until a Dickstein Forfeiture Event has ▇▇▇▇▇▇▇▇, shall be the Dickstein Designee, and (ii) f▇▇▇ (▇) ▇ender Group Designees. The Investor Group Designees (including the Dickstein Designee) and the Le▇▇▇▇ ▇▇▇▇▇▇p Designees are sometimes collectively referred to herein as the "Designees" and individually as a "Designee." (b) (i) The Investor Group Designator, the Lender Group Designator and the Dickstein Designator shall eac▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, e Company timely notice (the "Notice of Designee") of the name of each person whom the relevant Stockholder Group wishes to be nominated by the Company for election or re-election to the Company's board of directors by such board Board at the closing next meeting of stockholders, or taking of action by written consent of stockholders, at which Directors are to be elected (an "Election Meeting"). At the option of any Stockholder Group Designator, the Notice of Designee may also specify one or more alternates (an "Alternate Designee") to serve in the event of the transactions contemplated by the Purchase Agreement, incapacity or other inability to serve until of a Designee, as provided herein. The Investor Group Designees and the next annual meeting of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds Lender Group Designees shall at least 400,000 shares of Common Stock (which threshold all times include such number of shares Independent Directors as shall automatically be adjusted from time required to time to reflect increases, decreases or exchanges in, or comply with the distribution provisions of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transactionSections 2.3(b) and (ii2.3(c) is either an employee hereof. Each Notice of the Company or is subject Designee shall be in writing and shall be timely if delivered to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders Secretary of the Company at the expiration Company's principal executive offices not later than the close of his term, for so long as such Stockholder meets business on the Board Qualifications. If60th day prior to the first anniversary of the preceding year's annual meeting; provided, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet that in the Board Qualificationsevent that the date of the Election Meeting is more than 30 days before or after such anniversary date, the Stockholders shall choose one Notice of them Designee to be nominated for election timely must be so delivered not later than the later of (x) the close of business on the later of the 60th day prior to the Election Meeting and (y) the 20th day following the day on which public announcement of the date of the Election Meeting is first made by the Company's Board . In no event shall the public announcement of Directors and an adjournment of an Election Meeting commence a new time period for the giving of the Notice of Designee as described above. If the Company agrees has not received a Notice of Designee from any Stockholder Group Designator at a time when the relevant Stockholder Group is entitled to cause such Stockholder so chosen to be included in management's slate of nominees name one or more Designee on or before the 10th day before the latest date for election at each annual meeting delivery of the stockholders Notice of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own Designee specified in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time proviso to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction)next preceding sentence, the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of shall so inform the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of relevant Stockholder Group Designator by written notice. If the Company has not received a Notice of Designee from any Stockholder Group Designator at a time when the relevant Stockholder Group is entitled to name one or more Designee on or before the latest date for delivery of such Notice, then such Stockholder Group Designator shall be deemed to have delivered on such date a Notice of Designee designating the Designees specified in the most recently delivered Notice of Designee for any prior Election Meeting, or, if any such Designee is subject unable to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him serve and the Company)an Alternate Designee has been specified therefor, unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriateAlternate Designee.

Board Representation. The Stockholders(a) So long as at least 300,000 shares of Series A Preferred Stock (as adjusted for stock splits, collectivelystock dividends, recapitalizations and the like) are outstanding, the parties hereto agree to vote or act with respect to their shares so as to elect one (1) member of the Company's Board of Directors designated by holders of the majority of the Series A Preferred Stock, whose initial designee shall have be ▇▇▇▇▇ ▇▇▇▇▇, (b) So long as at least 3,000,000 shares of Series B and Series C Preferred Stock (as adjusted for stock splits, stock dividends, recapitalizations and the right like) are outstanding, the parties hereto agree to designate either vote or act with respect to their shares so as to elect (i) two (2) members of the Company's Board of Directors designated by the holders of the majority of then-outstanding Series B and Series C Preferred Stock (the "Series B and Series ------------------- C Directors"), whose initial designees shall be ▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇; ----------- and (ii) one (1) member of the Company's Board of Directors nominated by the Series B and Series C Directors and approved by a majority of the Company's Board of Directors other than the Series B and Series C Directors, whose initial designee shall be ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇. (c) So long as ▇▇▇▇ ▇▇▇▇▇▇▇South holds at least 75% of the Series C Preferred Stock purchased by it, the parties hereto agree to vote or act with regard to their shares so as they may choose, for election to elect one member of the Company's board Board of directors Directors as designated by such board at BellSouth. (d) The parties hereto agree to vote or act with respect to their shares so as to elect the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders Chief Executive Officer of the Company. Thereafter, if any one of ▇who is ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants date of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) abovethis Agreement, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Ifprovided, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualificationsthat such person shall resign as director upon termination or resignation as Chief Executive Officer, the Stockholders shall choose one of them such resignation to be nominated for election to the Company's Board of Directors and the Company agrees to cause effective upon termination or resignation from such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his termoffice, for so long as without further action by such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriateperson.

Board Representation. The Stockholders, collectively, shall have (a) From the right to designate either ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election to the Company's board of directors by such board Closing Date until XL no longer owns at the closing least 20% of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting principal amount of the stockholders outstanding Debentures, (x) the Company shall cause all of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ XL Designees (ias defined below) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders directors of the Company at the expiration Company's next stockholders' meeting and the Company shall support and use its best efforts to cause the election of his termsuch individuals to the board of directors of the Company and (y) XL shall have the right to request, for so long as and upon such Stockholder meets request the Board QualificationsCompany shall cause, the XL Designees to be elected to serve on the boards of directors of each of the Company's direct and indirect Subsidiaries. FurtherIn addition, for so long as all such XL Designees will be permitted to serve on any committees, including any executive committee of the Stockholders collectively own board of directors of the Company and each Subsidiary, unless such XL Designee is not qualified therefor under applicable law, rule or regulation, in which event XL shall have the aggregate not less than 800,000 right to select one individual to observe all such meetings in substitution therefor. "XL Designees" shall mean a number of individuals designated by XL equal to the greater of (x) two and (y) the number derived from multiplying the number of seats on the applicable board of directors times a fraction the numerator of which is the number of shares of Common Stock of the Company owned by XL (assuming conversion of all Debentures held by XL) and the denominator of which threshold is the number of outstanding shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as of the Company on a result Fully Diluted Basis (rounding up in the case of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transactionfractions), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ . At any time while an XL Designee is not a member of the Company's Board and each such Subsidiary's boards of Directors to be invited directors, at the sole discretion of XL, XL may appoint a representative of XL, and the Company and each such Subsidiary will permit such representative, to attend all meetings of the Company's Board boards of Directors as an observer (so long as he is either an employee directors of the Company and each such Subsidiary and any committees thereof. XL will continue to have the right to designate the XL Designees for election or is subject appointment to the noncompetition covenants boards of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors directors of the Company determines as to and each such Subsidiary in lieu of any particular meeting or meetings that considerations representative of confidentiality make such attendance inappropriateXL.

Board Representation. The Stockholders, collectively, shall have the right to designate either ▇▇▇▇Leon▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ Eric ▇▇▇▇▇▇▇, as ▇▇ they may choose, for election to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇Leon▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ Eric ▇▇▇▇▇▇▇ (i▇) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both Leon▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ Eric ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet t the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇Leon▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ Eric ▇▇▇▇▇▇▇ is ▇▇ not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriate.

Board Representation. The Stockholders(a) Not later than fifteen (15) days after the Closing Date, collectivelythe Trust shall: (i) take all necessary action, shall have if any, to increase the right number of trustees of the Trust by two, and (ii), subject to designate either ▇▇▇the Nevada Gaming Approvals, nominate and support for election to the board of trustees of the Trust ▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇, as they may choose, for election to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the Company. Thereafter, if any one of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ meet . (b) For so long as PRISA II shall maintain the Board QualificationsMinimum Share Ownership, PRISA II shall continue to be entitled to designate, subject to the Stockholders shall choose Nevada Gaming Approvals, one of them representative to be nominated for election to the Company's Board board of Directors trustees of the Trust, and the Company agrees Trust shall cause the board of trustees of the Trust to cause so nominate such Stockholder so chosen designee, and to be included in management's slate support such nomination along with the other nominees of nominees management and the board of directors, for election to the board of trustees of the Trust at each any annual or special meeting of the stockholders shareholders of the Company at Trust called for the expiration purpose of his term, for so long as such Stockholder meets the Board Qualificationselecting trustees. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member the individual so designated by PRISA II as of the Company's Board date of Directors this Agreement. If the representative designated by PRISA II shall be elected to be invited to attend meetings the board of trustees of the Company's Board Trust, such right of Directors PRISA II shall be suspended until such representative is up for re-election or the seat occupied thereby otherwise becomes vacant. Upon the death, disability, retirement, removal (with or without cause) or resignation of any such trustee designated by PRISA II, PRISA II shall have the right to designate a replacement for such individual to fill such capacity and serve as an observer (so long as he is either an employee a trustee of the Company or is Trust for the remainder of the departing trustee's term, and the trustees of the Trust shall appoint such replacement individual to the board of trustees of the Trust to fill such vacancy. If PRISA II shall at any time fail to maintain the Minimum Share Ownership, then the rights granted to PRISA II by this Section 18.01 shall immediately terminate and the party designated by PRISA II, if then a Trustee of the Trust, shall promptly resign such trusteeship. (c) The election and removal of trustees of the Trust shall at all times remain subject to the noncompetition covenants of Article VII terms and conditions of the Purchase Agreement or Trust's Constituent Documents. The provisions of this Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines as to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriate18.01 shall survive Closing.

Board Representation. The Stockholders, collectively, shall have the right to designate either If S▇▇ ▇. ▇▇▇▇▇, Ph.D. ceases to serve as Chairman of the Board of Directors due to (a) D▇▇ . ▇▇▇▇▇’▇ resignation as a director due to a material adverse change to the condition of D▇. ▇▇▇▇▇ or any member of D▇▇▇▇ . ▇▇▇▇▇▇▇, as they may choose, for election to ’▇ immediate family or (b) a vote or written consent of stockholders of the Company's board , in which the requisite majority for approval of directors such removal by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders of the CompanyCompany does not include any stockholders who serve on the Board of Directors or who are Affiliates of any individuals who serve on the Board of Directors, the Company shall promptly take any and all actions (including by increasing the size of the Board of Directors) as may be required under the laws of its state of incorporation, its certificate of incorporation and bylaws and any all other applicable laws set forth by any governmental authority in order to (i) cause, within five (5) Trading Days following D▇. Thereafter, if any one of ▇▇▇▇▇▇’▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ departure, (ix) holds at least 400,000 shares the election of Common Stock two directors designated by Genesis, which designees shall be (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transactionA) and (iiindependent under Section 5605(a)(2) is either an employee of the Company or is subject to the noncompetition covenants of Article VII rules of the Purchase Agreement or Section 7 of Nasdaq Stock Market (the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"“Independence Rules”), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the (B) not existing stockholders of the Company at on the expiration date hereof and (C) persons with relevant experience in either the biotechnology, pharmaceutical or healthcare industries, to serve as members of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them to be nominated for election to the Company's Board of Directors from the date hereof until such director designees’ resignation, death, removal or disqualification (the “Genesis Designees”) and (y) the Company agrees to cause such Stockholder so chosen to be included in management's slate election of nominees for election at each annual meeting a chairman of the stockholders of the Company at the expiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board of Directors of the Company determines who qualifies as an independent director under the Independence Rules and (ii) until the Debentures are either repaid or converted in full, include the Genesis Designees as nominees for election or re-election as members of the Board of Directors, as the case may be, in the proxy statement to be sent to any particular holders of the Company’s capital stock in connection with any annual or special meeting of such holders entitled to vote on such matters if the re-election of the members of the Board of Directors shall be proposed by the Board of Directors in such proxy statement and, in such instance, the Board of Directors shall recommend to any such holders of its capital stock entitled to vote at such meeting in such proxy statement the election or meetings that considerations re-election, as applicable, of confidentiality make such attendance inappropriatethe Genesis Designees.

Board Representation. The StockholdersAt the first meeting of the Board of Directors of the Company after the delivery of the Closing Buyer Shares, collectivelycurrently contemplated for January 31, 2003, the Company’s Board of Directors shall have increase the right to designate either number of Directors which shall constitute the Company’s Board of Directors and the resulting vacancy shall be filled by the Company’s Board of Directors electing M▇. ▇▇▇▇▇▇▇ as a Class II Director, with a term expiring at the 2003 Annual Meeting of Stockholders. The Company and its Board of Directors shall nominate and recommend M▇. ▇▇▇▇▇▇▇ for election as a Class II Director of the Company at the 2003 Annual Meeting of Stockholders for a term expiring at the 2006 Annual Meeting of Stockholders. At the 2003 Annual Meeting of Stockholders, the Principal Stockholders and the Investors agree to vote or act with respect to their shares of the Company’s common stock so as to elect the Investors’ designee, currently M▇▇▇▇ . ▇▇▇▇▇▇▇, as they may choose, for election to the Company's board of directors by such board at the closing of the transactions contemplated by the Purchase Agreement, to serve until the next annual meeting of the stockholders a Class II member of the Company. Thereafter’s Board of Directors for a term expiring at the 2006 Annual Meeting of Stockholders, unless this Agreement is terminated before the 2003 Annual Meeting of Stockholders pursuant to Section 2 below; provided, however, that with respect to the foregoing sentence, if any one of the Investors designate a person to serve as director other than M▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇▇ (i) holds at least 400,000 shares , then the person so designated shall be subject to the reasonable approval of Common Stock (which threshold number a majority of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee directors of the Company then serving in such capacity, which directors shall not include the director or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of nominees for election at each annual meeting of the stockholders directors of the Company who is, or was, serving as the previous designee of the Investors on the Company’s Board of Directors. At any other meeting or action by written consent of the Company’s stockholders during the term of this Agreement at or by which the expiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ meet the Board Qualifications, the Stockholders shall choose one of them Investors’ designee is proposed to be nominated for election to the Company's Board of Directors and the Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for election at each annual meeting of the stockholders of the Company at the expiration of his term, for so long removed as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ is not a member of the Company's ’s Board of Directors Directors, the Principal Stockholders and the Investors shall vote or act with respect to be invited to attend meetings their shares of the Company's ’s common stock so as to oppose the removal of the Investors’ designee as a member of the Company’s Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company)Directors, unless the Board of Directors of the Company determines as there is cause for such removal pursuant to any particular meeting or meetings that considerations of confidentiality make such attendance inappropriateSection 1.3.