Exhibit 2.2

AGREEMENT AND PLAN OF MERGER

BY AND AMONG

FORGENT NETWORKS, INC.,

CHEETAH ACQUISITION COMPANY, INC.,

iSARLA, INC.

AND

THE PRINCIPAL STOCKHOLDERS

Dated as of September 11, 2007

TABLE OF CONTENTS

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AGREEMENT AND PLAN OF MERGER

This AGREEMENT AND PLAN OF MERGER, dated as of September 11, 2007 (this “Agreement”), is entered into by and among Forgent Networks, Inc., a Delaware corporation (“Parent”), Cheetah Acquisition Company, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”), iSarla Inc., a Delaware corporation (the “Company”), and the Principal Stockholders.

RECITALS:

WHEREAS, each of the respective boards of directors of Parent, Merger Sub and the Company has approved this Agreement and the transactions contemplated hereby, pursuant to which, among other things, at the Effective Time, Merger Sub will be merged with and into the Company (the “Merger”) in accordance with the terms and conditions of this Agreement and the applicable provisions of the General Corporation Law of the State of Delaware (the “DGCL”), the Company will continue as the surviving corporation of the Merger and as a wholly-owned subsidiary of Parent and each share of Company Common Stock outstanding immediately prior to the Effective Time will be canceled and converted into the right to receive the consideration set forth herein, all upon the terms and subject to the conditions set forth in this Agreement;

WHEREAS, Parent, the Company and the Principal Stockholders desire to make certain representations, warranties and covenants in connection with this Agreement and the transactions contemplated hereby (the “Contemplated Transactions”); and

WHEREAS, concurrently with the execution and delivery of this Agreement, as an inducement to Parent’s and Merger Sub’s willingness to enter into this Agreement, the Principal Stockholders have entered into a Voting Agreement, dated as of the date hereof, in the form attached hereto as Exhibit D (the “Voting Agreement”), pursuant to which each Principal Stockholder has, among other things, agreed to (i) vote the shares of Company Common Stock as to which such Principal Stockholder is the beneficial owner (within the meaning of Rule 13d-3 of the Exchange Act) in favor of the approval of this Agreement and the Contemplated Transactions, and (ii) tender such shares of Company Common Stock for exchange in accordance herewith at or before the Closing.

NOW, THEREFORE, in consideration of the foregoing premises and the representations, warranties, covenants and agreements set forth herein, as well as other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, Parent, Merger Sub and the Company hereby agree as follows:

ARTICLE I

DEFINITIONS AND INTERPRETATION

Section 1.1             Certain Definitions.  For purposes of this Agreement, except as otherwise provided or unless the context clearly requires otherwise, the following words and phrases shall have the meanings given or referenced below:

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“Acquisition Proposal” shall have the meaning set forth in Section 5.2(a).

“Additional Escrow Stock” shall have the meaning set forth in Section 2.8(a)(iii).

“Adjusted Company Value” shall mean the Company Value minus the sum of (i) $2,000,000, being the combined value of the Ceridian Cash Payment and the Ceridian Stock Payment, and (ii) the product of the Global Accelerator Stock Payment multiplied by the Average Closing Price.

“Adjusted Fully Diluted Share Amount” shall mean the Fully Diluted Share Amount minus the sum of (i) the Ceridian Company Shares, and (ii) the Global Accelerator Company Shares.

“Adjusted Net Cash Payment Amount” shall mean the Net Cash Payment Amount minus the sum of (i) the Ceridian Cash Payment, and (ii) the Aggregate Non-Participating Holder Cash Payments.

“Adjusted Stock Payment Amount” shall mean the Total Stock Payment Amount minus the sum of (i) the Ceridian Stock Payment, and (ii) the Global Accelerator Stock Payment.

“Adjusted Stock Payment Value” shall mean the Initial Stock Payment Value minus the amount of any Elective Cash Payment made by the Parent pursuant to Section 2.9(b)(ii).

“Affiliate” shall mean any Person that, directly or indirectly, through one or more intermediaries, Owns, is Owned by or is under common Ownership with, a party, where “Own,” “Owned” or “Ownership” refers to (i) direct or indirect possession of at least fifty percent (50%) of the outstanding voting securities of a corporation or equity ownership in any other type of entity; or (ii) the actual ability of a Person to control and direct the management of the Person, whether by contract or otherwise.

“Aggregate Non-Participating Holder Cash Payments” shall mean the aggregate amount of the cash payments made to the Non-Participating Holders pursuant to Section 2.7(a)(iii).

“Agreement” shall have the meaning set forth in the first paragraph of this Agreement and Plan of Merger.

“Applicable Law” shall mean all applicable provisions of any applicable federal, state, local, municipal, foreign, international, multinational or other constitution, statute, law, principle of common law, rule, regulation, code, treaty, ordinance, requirement, decree, order, decision, guidance document, injunction, award, judgment, ruling, permit or license, issued, enacted, adopted, implemented, promulgated or otherwise put into effect by or under the authority of, any Governmental Body.

“Available Escrow Amount” means an amount equal to the Initial Escrow Consideration, plus any accrued interest on the Cash Escrow, plus any Additional Escrow Stock, less the amount of any Working Capital Deficit (if applicable), less the aggregate amount of any Pending Claim Holdbacks (but only for so long as, and to the extent that, they remain pending), less the aggregate amount distributed to Parent pursuant to the indemnification provisions benefiting

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Parent in Article VIII, less the aggregate amount distributable or previously distributed from the Escrow Consideration to Eligible Company Holders as contemplated pursuant to the provisions of this Agreement pertaining to the Escrow Consideration and the Escrow Agreement.

“Average Closing Price” shall mean the average of the closing prices for the Parent Common Stock for the twenty (20) trading days preceding the Closing, but excluding the three (3) highest and three (3) lowest closing prices during such period.

“Basket” shall have the meaning set forth in Section 8.2(c)(i).

“Business Day” shall mean a day which is not a Saturday, a Sunday or a day on which banks in the State of Delaware are closed.

“Cash Escrow” shall mean cash in the amount of fifteen percent (15%) of the Net Cash Payment Amount.

“CERCLA” shall have the meaning set forth in Section 3.21(a)(i).

“Ceridian Cash Payment” shall mean $1,000,000.

“Ceridian Company Shares” shall have the meaning set forth in Section 2.7(a)(i).

“Ceridian Stock Payment” shall mean the number of shares of Parent Company Stock equal to $1,000,000 divided by the Average Closing Price.

“Certificate” shall mean a certificate representing shares of Company Common Stock.

“Certificate of Merger” shall have the meaning set forth in Section 2.3.

“Closing” shall have the meaning set forth in Section 2.2.

“Closing Consideration” shall have the meaning set forth in Section 2.9(a).

“Closing Date” shall have the meaning set forth in Section 2.2.

“Closing Net Working Capital” shall have the meaning set forth in Section 2.13(e).

“COBRA” shall have the meaning set forth in Section 3.23(e).

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Company” shall have the meaning set forth in the first paragraph of this Agreement.

“Company Balance Sheet” shall mean the audited balance sheet of the Company dated as of the Closing Balance Sheet Date.

“Company Balance Sheet Date” shall have the meaning set forth in Section 3.7.

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“Company Common Stock” shall mean shares of the Company’s common stock, par value $.0001 per share.

“Company Disclosure Schedule” shall have the meaning set forth in Article III.

“Company Employee Plans” shall have the meaning set forth in Section 3.23(a).

“Company Financial Statements” shall have the meaning set forth in Section 3.4(a).

“Company Intellectual Property” shall mean Intellectual Property that is or has been used in (including in the development of) the business of, or any product or service offered or marketed or distributed by, any Company Party, or that is used in or necessary for the conduct of the business of any Company Party as currently conducted or contemplated to be conducted.

“Company International Employee Plans” shall have the meaning set forth in Section 3.23(a).

“Company Licensed Intellectual Property” shall have the meaning set forth in Section 3.11(e).

“Company Material Adverse Effect” shall mean a Material Adverse Effect on the Company Parties, taken as a whole.

“Company Party” shall mean the Company or any Subsidiary of the Company.  “Company Parties” shall mean the Company and each of its Subsidiaries.

“Company Party Current Facilities” shall have the meaning set forth in Section 3.21(b).

“Company Party Facilities” shall have the meaning set forth in Section 3.21(b).

“Company Sites” shall have the meaning set forth in Section 3.29(a)(i).

“Company Software Programs” shall mean Software Programs that are or have been used in (including in the development of) the business of, or any product or service offered or marketed or distributed by, any Company Party, or that are used in or necessary for the conduct of the business of any Company Party as currently conducted or contemplated to be conducted.

“Company Stock Options” shall mean options issued pursuant to the Company Stock Plan and exercisable for shares of Company Common Stock.

“Company Stock Plan” shall mean the iSarla Inc. 2000 Long-Term Stock Incentive Plan.

“Company Value” shall mean the sum of the Net Cash Payment Amount plus the Adjusted Stock Payment Value.

“Consent” shall mean any approval, consent, ratification, permission, waiver or authorization (including any license or governmental authorization).

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“Contemplated Transactions” shall have the meaning set forth in the Recitals.

“Contract” shall mean any contract, commitment, agreement, indenture, note, bond instrument, lease, license, purchase order, subcontract, outstanding bid, warranty or other document or arrangement, written or oral, expressed or implied, to which the Company is a party or by which the Company or its assets are bound, including all amendments thereto.

“Copyrights” shall have the meaning set forth in Section 3.11(a)(iv).

“Customers, Suppliers, Resellers and Partners” shall have the meaning set forth in Section 3.18.

“Damages” shall have the meaning set forth in Section 8.2(a).

“Delaware Secretary of State” shall have the meaning set forth in Section 2.3.

“DGCL” shall have the meaning set forth in the Recitals.

“Dissenting Shares” shall have the meaning set forth in Section 2.11(a).

“Effective Time” shall have the meaning set forth in Section 2.3.

“Elective Cash Payment” shall have the meaning set forth in Section 2.9(b)(ii).

“Eligible Company Holders” shall mean (a) all registered holders of Company Common Stock as of the Effective Time, and (b) all registered holders of In-the-Money Options as of the Effective Time.

“Eligible Holder Claim Notice” shall have the meaning set forth in Section 8.4(b).

“Eligible Holder Indemnified Parties” shall have the meaning set forth in Section 8.4(a).

“Encumbrances” shall mean any and all pledges, mortgages, security interests, liens, charges, assessments, levies, burdens, obligations, restrictions, claims and other encumbrances of any kind whatsoever (whether absolute, accrued, contingent or otherwise), including any chattel mortgages, conditional sale Contracts, collateral security arrangements, title or interest retention Contracts, or other Contracts to give any of the foregoing.

“Environmental Laws” shall have the meaning set forth in Section 3.21(a)(i).

“ERISA” shall have the meaning set forth in Section 3.23(a).

“ERISA Affiliate” shall have the meaning set forth in Section 3.23(a).

“Escrow Account” shall have the meaning set forth in Section 2.8(a)(i).

“Escrow Agent” shall have the meaning set forth in Section 2.8(a)(i).

“Escrow Agreement” shall have the meaning set forth in Section 2.8(a)(i).

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“Escrow Consideration” shall mean the Cash Escrow and the Escrow Stock.

“Escrow Fund” shall have the meaning set forth in Section 2.8(a)(i).

“Escrow Stock” shall mean the number of shares of Parent Common Stock equal to fifteen percent (15%) of the Total Stock Payment Amount, plus any Additional Escrow Stock.

“Exchange Act” shall mean the Exchange Act of 1934, as amended, including all rules and regulations related thereto or promulgated thereunder.

“Final Escrow Release Date” shall have the meaning set forth in Section 2.8(b)(ii).

“First Escrow Release Date” shall have the meaning set forth in Section 2.8(b)(i).

“Fully Diluted Share Amount” shall mean the sum of (i) total number of shares of Company Common Stock issued and outstanding immediately prior to the Effective Time, plus (ii) the total number of shares of Company Common Stock issuable upon exercise of all of the In-the-Money Options outstanding immediately prior to the Effective Time.

“GAAP” shall mean generally accepted accounting principles consistently applied in the U.S.

“Global Accelerator Company Shares” shall have the meaning set forth in Section 2.7(a)(ii).

“Global Accelerator Stock Payment” shall mean the number of shares of Parent Company Stock equal to:

where

A = the quotient of 2,899,979 divided by the Fully Diluted Share Amount;

B = the Net Cash Payment Amount;

C = the Adjusted Stock Payment Value; and

D = Average Closing Price.

“Governmental Body” shall mean any domestic or foreign entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government, including any governmental authority, agency, department, board, commission, court, tribunal, judicial body or instrumentality of any union of nations, federation, nation, state, municipality, county, province, locality or other political subdivision.

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“Gross Cash Payment Amount” shall mean $5,600,000 plus the amount of any Elective Cash Payment made by the Parent pursuant to Section 2.9(b)(ii).

“Hazardous Materials” shall have the meaning set forth in Section 3.21(a)(ii).

“HIPAA” shall have the meaning set forth in Section 3.23(e).

“In-the-Money Option” shall have the meaning set forth in Section 2.7(b)(i).

“In-the-Money Option Consideration” shall have the meaning set forth in Section 2.7(b)(i).

“Individuals” shall have the meaning set forth in Section 3.29(a)(ii).

“Initial Escrow Consideration” shall mean the Cash Escrow and the Escrow Stock.

“Initial Stock Payment Value” shall mean $5,100,000.

“Intellectual Property” shall have the meaning set forth in Section 3.11(a).

“International Trade Law” shall have the meaning set forth in Section 3.30.

“Issued Patents” shall have the meaning set forth in Section 3.11(a)(i).

“Knowledge” – an individual will be deemed to have “Knowledge” of a particular fact or other matter if:

(a)           such individual is actually aware of such fact or other matter; or

(b)           a prudent individual would be expected to discover or otherwise become aware of such fact or other matter in the ordinary and usual course of such individual’s performance of his or her official duties with respect to the applicable subject matter.

A Person (other than an individual) will be deemed to have “Knowledge” of a particular fact or other matter if any individual who is currently serving as a director, executive officer or senior manager of a Person (or in any similar capacity) has Knowledge of such fact or other matter.  A Person will be deemed to have Knowledge of a fact or other matter if any Subsidiary of such Person has Knowledge of such fact or other matter.

“Law” shall mean any federal, state, local, municipal, foreign, international, multinational or other constitution, statute, law, principle of common law, rule, regulation, code, treaty, ordinance, requirement, decree, order, decision, guidance document, injunction, award, judgment, ruling, permit or license, issued, enacted, adopted, implemented, promulgated or otherwise put into effect by or under the authority of, any Governmental Body

“Massachusetts Health Care Act” shall have the meaning set forth in Section 3.23(h).

“Material Adverse Effect” shall mean any event, change, condition or effect which, when considered either individually or in the aggregate together with other events, changes, conditions

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or effects, is materially adverse to (i) the applicable Person or its business or assets, or (ii) the ability of a Party to consummate the Contemplated Transactions; provided, that “Material Adverse Effect” shall not be deemed to include the impact of (i) changes in general economic conditions or financial markets; (ii) the announcement of this Agreement and the Contemplated Transactions; (iii) general changes or developments in the industries in which the Company Parties or the Parent, as applicable, operates; (iv) changes in Law or applicable accounting principles; or (v) actions or omissions of the Company Parties, on the one hand, and Parent, on the other, taken with the prior written consent of Parent, on the one hand, or the Company, on the other, in contemplation of the Contemplated Transactions.

“Material Contract” shall have the meaning set forth in Section 3.15.

“Merger” shall have the meaning set forth in the Recitals.

“Merger Consideration” shall mean the Closing Consideration and the Escrow Consideration.

“Merger Sub” shall have the meaning set forth in the first paragraph of this Agreement.

“Moral Rights” shall have the meaning set forth in Section 3.11(a)(xiii).

“Net Cash Payment Amount” shall mean the Gross Cash Payment Amount minus the sum of (i) the Required Debt Payments, and (ii) the absolute value of the Working Capital Purchase Price Reduction.

“Net Closing Cash Payment” shall mean the Net Cash Payment Amount, less the Cash Escrow.

“Net Closing Stock Payment” shall mean the Total Stock Payment Amount, less the Escrow Stock.

“Net Working Capital” shall mean the difference between the Company’s current assets and the Company’s current liabilities, as calculated using financial statements prepared in accordance with GAAP.

“Non-Participating Holder” shall have the meaning set forth in Section 2.9(b)(i).

“Order” shall mean any award, decision, injunction, judgment, decree, order, ruling, subpoena or verdict entered, issued, made or rendered by any Governmental Body or any arbitrator.

“Organizational Documents” shall mean (i) the articles or certificate of incorporation or formation and bylaws of a corporation, (ii) the partnership agreement and any statement of partnership of a general partnership; (iii) the limited partnership agreement and the certificate of limited partnership or certificate of formation of a limited partnership; (iv) any charter or similar document adopted or filed in connection with the creation, formation or organization of a Person; and (v) any amendment to any of the foregoing.

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“Parent” shall have the meaning set forth in the first paragraph of this Agreement.

“Parent Claim Notice” shall have the meaning set forth in Section 8.2(b).

“Parent Common Stock” shall mean shares of Parent’s common stock, par value $.01 per share.

“Parent Disclosure Schedule” shall have the meaning set forth in Article IV.

“Parent Indemnified Parties” shall have the meaning set forth in Section 8.2(a).

“Parent SEC Filings” shall have the meaning set forth in Section 4.6(a).

“Participating Holders” shall mean the Eligible Company Holders (other than Ceridian Corporation and Global Accelerator) who, at the Effective Time, qualify as “accredited investors” (as defined in the Securities Act) and thus are entitled to receive cash and Parent Company Stock pursuant to Section 2.7(a)(iv).

“Party” means any of Parent, Merger Sub, the Company or any Principal Stockholder.  “Parties” means Parent, Merger Sub, the Company and the Principal Stockholders.

“Patent Applications” shall have the meaning set forth in Section 3.11(a)(ii).

“Patents” shall have the meaning set forth in Section 3.11(a)(ii).

“Pending Claim” shall have the meaning set forth in Section 2.8(d).

“Pending Claim Holdback” shall have the meaning set forth in Section 2.8(d).

“Per Share Merger Consideration” shall mean the quotient of the Adjusted Company Value divided by the Adjusted Fully Diluted Share Amount.

“Permit” shall mean any franchise, authorization, license, permit, approval, permission, grant, consent or certificate from any Person.

“Permitted Encumbrances” means: (a) statutory liens for Taxes not yet due; (b) mechanics’, carriers’, workers’, repairers’ and other similar liens arising or incurred in the ordinary course of business relating to obligations as to which there is no default on the part of the Company Parties; (c) pledges, deposits or other liens securing the performance of bids, trade contracts, leases or statutory obligations (including workers’ compensation, unemployment insurance or other social security legislation) as to which there is no default on the part of the Company Parties; (d) zoning, entitlement, conservation restriction and other land use and environmental regulations by Governmental Bodies of general application and as to which there is no default on the part of the Company Parties; and (e) the exceptions, easements, rights-of-way and other Encumbrances listed on Schedule 1.1.

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“Person” means any natural person, corporation, unincorporated organization, partnership, association, joint stock company, joint venture, limited liability company, trust or government, or any other entity or any Governmental Body.

“Pre-Closing Balance Sheet” shall have the meaning set forth in Section 2.13(a).

“Pre-Closing Distribution” shall have the meaning set forth in Section 2.13(b).

“Pre-Closing Net Working Capital” shall have the meaning set forth in Section 2.13(a).

“Principal Stockholders” shall mean ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ Software LLC and ▇▇▇▇▇ Infotech.

“Privacy Statements” shall have the meaning set forth in Section 3.29(a)(ii).

“Proceeding” means any lawsuit, arbitration, hearing, audit, inquiry, examination, investigation, cause of action, complaint, claim, demand letter or inquiry or any civil, administrative, investigative, appellate or criminal action, suit or proceeding or governmental investigation.

“Proposed Closing Balance Sheet” shall have the meaning set forth in Section 2.13(c).

“Proposed Closing Net Working Capital Statement” shall have the meaning set forth in Section 2.13(c).

“Public Software” means any software that contains, or is derived in any manner (in whole or in part) from, any software that is distributed as free software (as defined by the Free Software Foundation), open source software (e.g., Linux or software distributed under any license approved by the Open Source Initiative as set forth ▇▇▇.▇▇▇▇▇▇▇▇▇▇.▇▇▇) or similar licensing or distribution models which requires the distribution of source code to licensees, including software licensed or distributed under any of the following licenses or distribution models, or licenses or distribution models similar to any of the following: (i) GNU’s General Public License (GPL) or Lesser/Library GPL (LGPL); (ii) the Artistic License (e.g., PERL); (iii) the Mozilla Public License; (iv) the Netscape Public License; (v) the Sun Community Source License (SCSL); (vi) the Sun Industry Standards License (SISL); (vii) the BSD License; or (viii) the Apache License.

“RCRA” shall have the meaning set forth in Section 3.21(a)(i).

“Real Property” shall have the meaning set forth in Section 3.20(c).

“Real Property Leases” shall have the meaning set forth in Section 3.20(e).

“Registration Rights Agreement” shall have the meaning set forth in Section 5.6.

“Related Documents” shall have the meaning set forth in Section 8.1.

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“Required Debt Payments” shall mean the sum of (a) all debts of the Company (other than current accounts payable and current accruals, in each case in the ordinary course of business) immediately prior to the Effective Time, (b) all payments owing to holders of options, stock appreciation rights or other similar equity interests, and (c) all severance payments due as of the Closing or as a result of the Contemplated Transactions.

“Representative” shall mean, with respect to a particular Person, any director, officer, employee, agent, consultant, advisor or other representative of such Person, including legal counsel, accountants and financial advisors.

“SEC” shall mean the Securities and Exchange Commission of the United States.

“Securities Act” shall mean the Securities Act of 1933, as amended, including all rules and regulations related thereto or promulgated thereunder.

“Special Basket” shall have the meaning set forth in Section 8.6(b).

“Special Indemnity Expiration Date” shall mean the date that is thirty (30) months after the Closing Date.

“Special Indemnity Insurance” shall have the meaning set forth in Section 5.14.

“Special Insurance Claim” shall have the meaning set forth in Section 8.6(b).

“Stipulated Closing Net Working Capital Statement” shall have the meaning set forth in Section 2.13.

“Software Programs” shall have the meaning set forth in Section 3.11(a)(vii).

“Stock Consideration” shall mean the portion of the Merger Consideration payable in Parent Common Stock.

“Stockholder Representative” shall have the meaning set forth in Section 8.5(b).

“Subsidiary” shall mean with respect to a Person, any other Person with respect to which such first Person directly or indirectly owns, beneficially or of record, at least fifty percent (50%) of the outstanding equity or financial interests of such other Person.

“Surviving Corporation” shall have the meaning set forth in Section 2.1.

“Taxes” shall mean all tax liabilities of any kind, levies or other like assessments payable to federal, state, commonwealth, local, foreign and any other taxing authority in any jurisdiction, including income (personal or corporate), net income, gross income, gross receipts, sales, use, ad valorem, transfer, capital stock, capital taxes, franchise, profits, license, lease, service, add on or alternative minimum tax, occupancy, withholding, payroll, fringe benefits, employment, employees’ income withholding, foreign or domestic withholding, unemployment, disability, excise, severance, stamp (both on the issuance and on the transfer of securities), value added, goods and services, occupation, premium, property (including real property and personal

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property taxes and any assessments, special or otherwise), environmental, windfall profits, customs, duties or other taxes, imposts, fees, assessments, levies, tariffs, or charges of any kind whatever, together with any interest, costs, expenses and any penalties, additions to tax or additional amounts with respect thereto, including any obligation to indemnify or otherwise assume or succeed to the tax liability of any other Person, whether by contract, statute or otherwise (and “Tax” means any one of the foregoing Taxes).

“Tax Return” shall mean any return, declaration, report, form or similar statement required to be filed with respect to any Tax (including any attached schedules), including any information return, claim for refund, amended return or declaration of estimated Tax.

“Terms and Conditions” shall have the meaning set forth in Section 3.29(a)(iii).

“Trade Secrets” shall have the meaning set forth in Section 3.11(a)(viii).

“Total Stock Payment Amount” shall mean the number of shares of Parent Company Stock equal to the Adjusted Stock Payment Value divided by the Average Closing Price.

“Trademarks” shall have the meaning set forth in Section 3.11(a)(v)

“Triggering Event” shall be deemed to have occurred if: (i) the Company, any of its Affiliates or any Representatives violates any of the requirements or restrictions in Section 5.2; (ii) the Company’s Board of Directors publicly recommends to the Company’s stockholders any Acquisition Proposal; (iii) the Company enters into any agreement, letter of intent or similar document contemplating or otherwise relating to any merger, consolidation, share exchange, business combination, sale of all or substantially all of the assets, sale of shares of capital stock or similar transactions involving any Company Party, other than the Contemplated Transactions; or (iv) the Company’s Board of Directors withdraws, or materially and adversely modifies, its recommendation of the Merger or this Agreement (it being understood that for all purposes of this Agreement, the fact that the Company has supplied any Person with any information regarding the Company or has entered into discussion or negotiation with such Person as permitted by this Agreement or the public disclosure of such facts, shall not be deemed a withdrawal or modification of the Company’s Board of Directors’ recommendation of the Merger or this Agreement).

“Voting Agreement” shall have the meaning set forth in the Recitals.

“Working Capital Deficit” shall have the meaning set forth in Section 2.13(e).

“Working Capital Purchase Price Reduction” shall have the meaning set forth in Section 2.13(b).

“Working Capital Surplus” shall have the meaning set forth in Section 2.13(e).

Section 1.2             Interpretation.

(a)           The terms “Article,” “Section,” “Recital,” “Schedule” and “Exhibit” refer to the specified Article, Section, Recital, Schedule or Exhibit of this Agreement.

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(b)           Whenever the words “include”, “includes” or “including” (or any variation thereof) are used in this Agreement, they shall be deemed to be followed by the words “without limitation,” and shall not be construed to limit any general statement which any such word follows to the specific or similar items or matters immediately following such word, unless otherwise expressly stated.

(c)           The words “hereof”, “herein” and “herewith” and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement.

(d)           The plural of any defined term shall have a meaning correlative to such defined term, and words denoting any gender shall include all genders. Where a word or phrase is defined herein, each of its other grammatical forms shall have a corresponding meaning.

(e)           A reference to any party to this Agreement or any other agreement or document shall include such party’s permitted successors, assigns and transferees.

(f)            A reference to any Applicable Law or to any provision of any Applicable Law shall include any amendment, modification or re-enactment thereof, any legislative provision substituted therefor and all regulations and statutory instruments issued thereunder or pursuant thereto.

(g)           The Parties have participated jointly in the negotiation and drafting of this Agreement.  In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.

ARTICLE II

THE MERGER

Section 2.1             The Merger.  Upon the terms and subject to the conditions set forth in this Agreement and the applicable provisions of the DGCL, on the Closing Date and at the Effective Time Merger Sub shall be merged with and into the Company, the separate corporate existence of Merger Sub shall thereupon cease and the Company shall continue as the surviving corporation of the Merger.  The Company, as the surviving corporation of the Merger, is sometimes referred to herein as the “Surviving Corporation.”

Section 2.2             The Closing.  The consummation of the Merger (the “Closing”) shall take place at a closing to occur at the offices of ▇▇▇▇▇▇▇▇ PC, 5400 Renaissance Tower, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, on a date and at a time to be agreed upon by Parent and the Company, which date shall be no later than the second (2nd) Business Day after the satisfaction or waiver (to the extent permitted hereunder) of the last to be satisfied or waived of the conditions set forth in Article VI (other than those conditions that by their terms are to be satisfied at the Closing, but subject to the satisfaction or waiver (to the extent permitted

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hereunder), of such conditions), or at such other location, date and time as Parent and the Company shall mutually agree upon in writing. The date upon which the Closing shall actually occur pursuant hereto is referred to herein as the “Closing Date.”

Section 2.3             The Effective Time.  Upon the terms and subject to the conditions set forth in this Agreement, on the Closing Date, Parent and the Company shall cause the Merger to be consummated under the DGCL by filing a certificate of merger in customary form and substance (the “Certificate of Merger”) with the Secretary of State of the State of Delaware (the “Delaware Secretary of State”) in accordance with the applicable provisions of the DGCL.  The time of such filing and acceptance by the Delaware Secretary of State, or such later time as may be agreed in writing by Parent and the Company and specified in the Certificate of Merger is referred to herein as the “Effective Time.”

Section 2.4             Effect of the Merger.  The effect of the Merger shall be as provided in this Agreement and the applicable provisions of the DGCL.  Without limiting the generality of the foregoing, and subject thereto, at the Effective Time all of the property, rights, privileges, powers and franchises of the Company and Merger Sub shall vest in the Surviving Corporation, and all debts, liabilities and duties of the Company and Merger Sub shall become the debts, liabilities and duties of the Surviving Corporation.

Section 2.5             Certificate of Incorporation and Bylaws.

(a)           Certificate of Incorporation.  At the Effective Time, the Certificate of Incorporation of the Company shall be amended and restated in its entirety to read identically to the Certificate of Incorporation of Merger Sub, as in effect immediately prior to the Effective Time, and such amended and restated Certificate of Incorporation shall become the Certificate of Incorporation of the Surviving Corporation until thereafter amended in accordance with the applicable provisions of the DGCL and such Certificate of Incorporation; provided, however, that at the Effective Time the Certificate of Incorporation of the Surviving Corporation shall be amended so that the name of the Surviving Corporation shall be  “iEmployee Inc.” or such other name as Parent shall select.

(b)           Bylaws.  At the Effective Time, the Bylaws of Merger Sub, as in effect immediately prior to the Effective Time, shall become the Bylaws of the Surviving Corporation until thereafter amended in accordance with the applicable provisions of the DGCL, the Certificate of Incorporation of the Surviving Corporation and such Bylaws.

Section 2.6             Directors and Officers.

(a)           Directors.  At the Effective Time, the initial directors of the Surviving Corporation shall be the directors of Merger Sub immediately prior to the Effective Time, each to hold office in accordance with the Certificate of Incorporation and Bylaws of the Surviving Corporation until their respective successors are duly elected or appointed and qualified.

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(b)           Officers.  At the Effective Time, the initial officers of the Surviving Corporation shall be the officers of Merger Sub immediately prior to the Effective Time, each to hold office in accordance with the Certificate of Incorporation and Bylaws of the Surviving Corporation until their respective successors are duly appointed.

Section 2.7             Effect on Outstanding Capital Stock and Options.

(a)           Capital Stock of the Company.  Upon the terms and subject to the conditions set forth in this Agreement (including the conditions of Section 2.7(b)), at the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, the Company, or the holders of any of the following securities, the following shall occur:

(i)            Common Stock Held by Ceridian.  The 5,720,934 shares of Company Common Stock held by Ceridian Corporation immediately prior to the Effective Time (the “Ceridian Company Shares”) shall be converted into the right to receive the Ceridian Cash Payment and the Ceridian Stock Payment.

(ii)           Common Stock Held by Global Accelerator.  The 2,899,979 shares of Company Common Stock held by Global Accelerator immediately prior to the Effective Time (the “Global Accelerator Company Shares”) shall be converted into the right to receive the Global Accelerator Stock Payment.

(iii)          Common Stock Held by Non-Participating Holders.  Each share of Company Common Stock that is held by a Non-Participating Holder and that is outstanding immediately prior to the Effective Time shall be canceled and extinguished and automatically converted into the right to receive cash in an amount equal to the product of (A) the quotient of one (1) divided by the Adjusted Fully Diluted Share Amount, multiplied by (B) the Adjusted Company Value.

(iv)          Common Stock Held by Participating Holders.  Each share of Company Common Stock that is held by a Participating Holder and is outstanding immediately prior to the Effective Time shall be canceled and extinguished and automatically converted into the right to receive the following consideration:

(A)          Cash in an amount equal to the product of (I) the quotient of one (1) divided by the Adjusted Fully Diluted Share Amount, multiplied by (II) the Adjusted Net Cash Payment Amount; and

(B)           The number of shares of Parent Common Stock equal to the product of (I) the quotient of one (1) divided by the Adjusted Fully Diluted Share Amount, multiplied by (II) the Adjusted Stock Payment Amount.

(b)           Capital Stock of Merger Sub.  Each share of capital stock of Merger Sub that is outstanding immediately prior to the Effective Time shall be converted into one validly issued, fully paid and nonassessable share of common stock of the Surviving

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Corporation.  Each certificate evidencing ownership of such shares of capital stock of Merger Sub shall thereafter evidence ownership of shares of common stock of the Surviving Corporation.

(c)           Company Options.

(i)            In-the-Money Options.  As of the Effective Time, by virtue of the Merger and without any action on the part of any holder thereof, each Company Stock Option with an exercise price per share of underlying Company Common Stock which is less than the Per Share Merger Consideration (each, an “In-the-Money Option”) shall be canceled and extinguished and automatically converted into the right (subject to Section 2.9(b)) to receive the following consideration (the “In-the-Money Option Consideration”) (upon payment of the applicable exercise price for such In-the-Money Option, which in all instances shall be deducted from the aggregate amount of the In-the-Money Option Consideration otherwise payable to such holder, such that the right of each holder of an In-the-Money Option to receive such holder’s portion of the In-the-Money Option Consideration will be “cashless” to such holder):

(A)          Cash in the amount otherwise payable in respect of all shares of Company Common Stock subject to such In-the-Money Option (assuming for this purpose, full acceleration of vesting as of immediately prior to the Effective Time); and

(B)           The number of shares of Parent Common Stock otherwise payable in respect of all shares of Company Common Stock subject to such In-the-Money Option (assuming for this purpose, full acceleration of vesting as of immediately prior to the Effective Time).

(ii)           Other Options.  As of the Effective Time, by virtue of the Merger and without any action on the part of any holder thereof, each Company Stock Option which is not an In-the-Money Option shall be terminated and canceled, and no payment or distribution shall be made with respect thereto.

(iii)          Provisions for Options.  The Company shall take all actions necessary to ensure that (A) the Company Stock Options are, as of the Effective Time, modified as provided in the foregoing subsections (i) and (ii) and the following subsection (iv), (B) except with respect to the In-the-Money Options, the Company Stock Plan is terminated as of the Effective Time, (C) the provisions in any other plan, program or arrangement of the Company providing for the issuance or grant of any other interest in respect of the capital stock of the Company shall be terminated as of the Effective Time, (D) following the Effective Time, no participant in any other plans, programs or arrangements of the Company shall have any right thereunder to acquire or participate in changes in value of equity securities of the Company, the Surviving Corporation, Merger Sub or any of their respective Subsidiaries, and (E) all such other plans, programs or arrangements of the Company are terminated effective as of the Effective Time.

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(iv)          Acceleration of Vesting; Termination of Right of Repurchase.  The Parties acknowledge and agree that, with respect to any and all shares of Company Common Stock (including shares which may be issued upon the exercise of In-the-Money Options) and all Company Stock Options, all vesting conditions with respect thereto shall be deemed to have fully accelerated, and any rights of repurchase or other similar restrictions or limitations with respect thereto shall be deemed to have fully lapsed, as of immediately prior to the Effective Time.

(d)           Fractional Shares.  No fraction of a share of Parent Common Stock will be issued by virtue of the Merger, but in lieu thereof each holder of record of shares of Company Common Stock (including shares which may be issued upon the exercise of In-the-Money Options) who would otherwise be entitled to a fraction of a share of Parent Common Stock pursuant to this Section 2.7 (after aggregating all fractional shares of Parent Common Stock that otherwise would be received by such holder of record) shall, upon the surrender of the certificate, if any, representing such share of Company Common Stock in the manner provided in Section 2.9 (or in the case of a lost, stolen or destroyed certificate, upon delivery of an affidavit (and bond, if required) in the manner provided in Section 2.9), receive from Parent an amount of cash (rounded to the nearest whole cent), without interest, equal to the product obtained by multiplying such fraction by the Average Closing Price of Parent Common Stock.

Section 2.8             Escrow Account.

(a)           Escrow Fund.

(i)            Parent will, prior to the Closing and pursuant to the terms of the Escrow Agreement substantially in the form attached hereto as Exhibit A, with such changes as may be requested or required by the Escrow Agent (the “Escrow Agreement”), deposit the Cash Escrow and the Escrow Stock with JPMorganChase or such other financial institution reasonably acceptable to the Company as Parent shall determine (the “Escrow Agent”).  The Cash Escrow will be held in an interest-bearing escrow account (the “Escrow Account”).  The Escrow Stock shall be registered in the name of, and be deposited with, the Escrow Agent.  The amounts in the Escrow Account and number of shares of Escrow Stock shall be known collectively as the “Escrow Fund.”

(ii)           In the event Parent issues any Additional Escrow Stock, such shares will be issued in the name of the Escrow Agent and delivered to the Escrow Agent in the same manner as the Escrow Stock delivered at the Closing.

(iii)          Except for dividends paid in stock declared with respect to the Escrow Stock (the “Additional Escrow Stock”), which shall be treated as Escrow Stock pursuant to Section 2.8(a), any cash dividends, dividends payable in securities or other distributions of any kind made in respect of the Escrow Stock will be delivered to the applicable Eligible Company Holders (subject to Section 2.9(b)) on a pro rata basis.  Each applicable Eligible Company Holder

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will have voting rights with respect to the Escrow Stock deposited into the Escrow Fund with respect to such Eligible Company Holder so long as such shares are held in escrow, and Parent will take all reasonable steps necessary to allow the exercise of such rights.  While the Escrow Stock remains in the Escrow Agent’s possession pursuant to this Agreement, the applicable Eligible Company Holders will retain and be able to exercise all other incidents of ownership of said Escrow Stock which is not inconsistent with the terms and conditions of this Agreement.

(b)           Retention and Release.  The Escrow Fund shall be held by the Escrow Agent for the benefit of Parent and all Eligible Company Holders pursuant to the terms of this Agreement and the Escrow Agreement.  Any consideration to be distributed from the Escrow Fund to the Eligible Company Holders will be distributable to such Eligible Company Holders, subject to Section 2.9(b), on a pro rata basis, based upon their relative entitlement or assumed entitlement to receive Merger Consideration as contemplated by Sections 2.7 and 2.9.  All distributions shall include a ratio of cash and Parent Common Stock such that the ratio of cash to Parent Common Stock remaining after the distribution is equivalent to the ratio of cash to Parent Common Stock before the distribution (with the value of Parent Common Stock used to calculate such ratio and each distribution (to the Eligible Company Holders or any indemnified party) being the Average Closing Price).  Subject to the indemnification rights of Parent described in Article VIII, the Escrow Fund shall be distributable as follows:

(i)            the amount by which the Available Escrow Amount (immediately prior to such distribution), exceeds seven and one-half percent (7.5%) of the Merger Consideration shall be distributed to the Eligible Company Holders on the date which is twelve (12) months after the Closing Date (the “First Escrow Release Date”);

(ii)           all remaining Available Escrow Amount and any other amounts which shall have been delivered into the Escrow Account shall be distributed to the Eligible Company Holders on the date which is eighteen (18) months after the Closing Date (the “Final Escrow Release Date”); and

(iii)          any further amounts which, following the Final Escrow Release Date, shall be delivered into the Escrow Account or otherwise become available for distribution to the Eligible Company Holders (including amounts which may previously have been withheld due to a Pending Claim Holdback where final resolution of the related Pending Claim yields less than a full payment of the amount at issue to Parent), together with all interest which has accrued thereon, shall be distributed to the Eligible Company Holders immediately following the date any such amount shall be so delivered or otherwise become so available.

(c)           Non-assignable Interest.  The interests of an Eligible Company Holder in the Escrow Fund will not be assignable or transferable by such Eligible Company Holder unless and until released pursuant to the terms of the Escrow Agreement.

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(d)           Pending Claim Holdbacks.  In the event Parent has made, in accordance with Section 8.2, a claim for indemnification in a Parent Claim Notice, and such claim has been objected to as provided in Article VIII and has not otherwise been finally determined (a “Pending Claim”), the Escrow Agent shall withhold from distribution a portion of the Escrow Fund equal to the Damages at issue (such amount being a “Pending Claim Holdback”) until such time as either the Pending Claim has been finally determined or the objection resolved, as applicable, in which case the appropriate amounts will be either distributed to Parent or retained in the Escrow Fund (for distribution to the applicable Eligible Company Holders as provided in Section 2.8(b)), or both, as the case may be.

(e)           Inability to Deliver.  If the Escrow Agent is not able to deliver any portion of the Escrow Fund to the proper recipient within one (1) year of the date that final distribution of any remaining portion of the Escrow Fund should otherwise have been made pursuant to Section 2.8(b) (or immediately prior to such earlier date on which any payment in respect thereof would otherwise escheat to or become the property of any Governmental Body), such portion of the Escrow Fund shall be delivered to Parent and the proper recipient shall thereafter look only to Parent, and only as a general creditor, for payment of such recipient’s claim for such portion of the Escrow Fund, subject to applicable abandoned property, escheat and similar Laws.

Section 2.9             Exchange of Closing Consideration at Closing.

(a)           Subject to Section 2.9(b), at the Closing, upon the surrender by each Eligible Company Holder of his or her Certificates and delivery of such other documents as may reasonably be required by Parent (such as a lost share certificate affidavit, where applicable), the Certificate(s) so surrendered shall be canceled and the In-the-Money Option(s) at issue shall be deemed exercised and the holder of such Certificate(s) or In-the-Money Option(s) shall be entitled to receive in exchange therefor (collectively, the “Closing Consideration”):

(i)            Ceridian Corporation.  Ceridian Corporation shall receive from Parent the following:  (x) a check or, if requested, a wire transfer of immediately available funds, in the amount of the Ceridian Cash Payment minus Ceridian’s pro rata share of the Cash Escrow, being an amount equal to the Cash Escrow multiplied by the quotient of (A) the total amount of cash Merger Consideration which Ceridian is entitled to receive under Section 2.7, divided by (B) the total amount of cash Merger Consideration which all Eligible Company Holders are entitled to receive under Section 2.7; (y) a stock certificate representing the number of shares of Parent Company Stock equal to the Ceridian Stock Payment, minus Ceridian’s pro rata share of the Escrow Stock, being an amount equal to the Escrow Stock multiplied by the quotient of (A) the number of shares of Parent Common Stock which Ceridian is entitled to receive under Section 2.7, divided by (B) the total number of shares of Parent Common Stock which all Eligible Company Holders are entitled to receive under Section 2.7 (with such number of shares being rounded to the next lowest whole number so as to eliminate any fractional shares); and (z) a check or, if requested, a wire transfer of immediately

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available funds, representing the amount of cash payable in lieu of any fractional shares pursuant to Section 2.7(d);

(ii)           Global Accelerator.  Global Accelerator shall receive from Parent the following:  (x) a stock certificate representing the number of shares of Parent Company Stock equal to the Global Accelerator Stock Payment, minus Global Accelerator’s pro rata share of the Escrow Stock, being an amount equal to the Escrow Stock multiplied by the quotient of (A) the number of shares of Parent Common Stock which Global Accelerator is entitled to receive under Section 2.7, divided by (B) the total number of shares of Parent Common Stock which all Eligible Company Holders are entitled to receive under Section 2.7 (with such number of shares being rounded to the next lowest whole number so as to eliminate any fractional shares); and (y) a check or, if requested, a wire transfer of immediately available funds, representing the amount of cash payable in lieu of any fractional shares pursuant to Section 2.7(d);

(iii)          Non-Participating Holders.  Each Non-Participating Holder shall receive from Parent a check or, if requested, a wire transfer of immediately available funds, in an amount equal to the amount of cash Merger Consideration which he is entitled to receive under Section 2.7(a)(iii) minus his pro rata share of the Cash Escrow, being an amount equal to the Cash Escrow multiplied by the quotient of (A) the total amount of cash Merger Consideration which such Non-Participating Holder is entitled to receive under Section 2.7, divided by (B) the total amount of cash Merger Consideration which all Eligible Company Holders are entitled to receive under Section 2.7;

(iv)          Participating Holders.  Each Participating Holder shall receive from Parent the following: (x) a check or, if requested, a wire transfer of immediately available funds, in an amount equal to the amount of cash Merger Consideration which he is entitled to receive under Section 2.7(a)(iv) minus his pro rata share of the Cash Escrow, being an amount equal to the Cash Escrow multiplied by the quotient of (A) the total amount of cash Merger Consideration which such Participating Holder is entitled to receive under Section 2.7, divided by (B) the total amount of cash Merger Consideration which all Eligible Company Holders are entitled to receive under Section 2.7; (y) a stock certificate representing the number of shares of Parent Common Stock which he is entitled to receive under Section 2.7(a)(iv) minus his pro rata share of the Escrow Stock, being an amount equal to the Escrow Stock multiplied by the quotient of (A) the number of shares of Parent Common Stock which such Participating Holder is entitled to receive under Section 2.7, divided by (B) the total number of shares of Parent Common Stock which all Eligible Company Holders are entitled to receive under Section 2.7, (with such number of shares being rounded to the next lowest whole number so as to eliminate any fractional shares); and (z) a check or, if requested, a wire transfer of immediately available funds, representing the amount of cash payable in lieu of any fractional shares pursuant to Section 2.7(d); and

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(v)           In-the-Money Option Holders.  Each holder of an In-the-Money Option shall receive the following (upon payment of the applicable exercise price for such In-the-Money Option, which in all instances shall be deducted from the aggregate amount of the In-the-Money Option Consideration otherwise payable to such holder, such that the right of each holder of an In-the-Money Option to receive such holder’s portion of the In-the-Money Option Consideration will be “cashless” to such holder): (x) a check or, if requested, a wire transfer of immediately available funds, in an amount equal to the amount of cash Merger Consideration which he is entitled to receive under Section 2.7(c)(i) minus his pro rata share of the Cash Escrow, being an amount equal to the Cash Escrow multiplied by the quotient of (A) the total amount of cash Merger Consideration which such In-the-Money Option Holder is entitled to receive under Section 2.7 (assuming for this purpose, full acceleration of vesting as of immediately prior to the Effective Time), divided by (B) the total amount of cash Merger Consideration which all Eligible Company Holders are entitled to receive under Section 2.7; (y) a stock certificate representing the number of shares of Parent Common Stock which he is entitled to receive under Section 2.7(c)(i) minus his pro rata share of the Escrow Stock, being an amount equal to the Escrow Stock multiplied by the quotient of (A) the number of shares of Parent Common Stock which such In-the-Money Option Holder is entitled to receive under Section 2.7, divided by (B) the total number of shares of Parent Common Stock which all Eligible Company Holders are entitled to receive under Section 2.7 (with such number of shares being rounded to the next lowest whole number so as to eliminate any fractional shares); and (z) a check or, if requested, a wire transfer of immediately available funds, representing the amount of cash otherwise payable in lieu of any fractional shares pursuant to Section 2.7(d).

(b)           Adjustment of Merger Consideration.  Notwithstanding anything herein to the contrary and in addition to the rights set forth in Section 7.1(e):

(i)            With respect to any Eligible Company Holder (other than Ceridian Corporation and Global Accelerator) that is not an “accredited investor” (as defined in the Securities Act) (each, a “Non-Participating Holder”), Parent shall have the right in its sole and absolute discretion to pay such Non-Participating Holder all of such Non-Participating Holder’s applicable portion of the Merger Consideration (with respect to any consideration otherwise payable at Closing and with respect to any consideration to be placed in escrow) in cash.

(ii)           If the Average Closing Price of the Parent Common Stock as of the Closing Date drops to a price that, as otherwise contemplated by this Agreement, would require the Company to solicit the approval of its stockholders pursuant to Section 4350(i) of the NASDAQ Rules, Parent shall have the right in its sole and absolute discretion to pay some or all of the value of the Stock Consideration in cash (the “Elective Cash Payment”).  In the event that Parent elects to pay some or all of the value of the Stock Consideration in cash, then the definition of Total Stock Payment Amount shall be modified such that the number $5,100,000 shall be reduced by the amount of the Elective Cash Payment and the definition of Net

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Cash Payment Amount shall be modified such that the number $5,600,000 shall be increased by the amount of the Elective Cash Payment.

(c)           Limited Right; Dividends after the Effective Time.  Each In-the-Money Option and, until surrendered as contemplated by this Section 2.9, each Certificate shall be deemed at any time after the Effective Time to represent only the right to receive the Merger Consideration that the holder thereof has the right to receive pursuant to the provisions of this Article II.  Except with respect to amounts that may be released from the Escrow Fund to Eligible Company Holders, no interest shall be paid or will accrue on any cash payable to Eligible Company Holders pursuant to the provisions of this Article II.  In the event that any dividends accrue or become payable from and after the Effective Time with respect to any shares of Parent Common Stock to be issued as part of the Merger Consideration, then any recipient of such shares as contemplated by this Article II shall be entitled thereto as though such recipient had been the holder of record of such shares as of the Effective Time.  No dividends or other distributions declared or made with respect to Parent Common Stock with a record date after the Effective Time shall be paid to the holder of any unsurrendered Certificate with respect to the shares of Parent Common Stock that such holder has the right to receive in the Merger until such holder surrenders such Certificate in accordance with this Section 2.9, at which time such holder shall be entitled, subject to the effect of applicable escheat or similar Laws, to receive all such dividends and distributions, without interest.

(d)           No Further Ownership Rights in Company Capital Stock.  The Merger Consideration shall be deemed to have been paid in full satisfaction of all rights pertaining to the shares of Company Common Stock theretofore represented by such Certificates, subject, however, to Parent’s obligation to pay the Merger Consideration pursuant to the terms of this Article II (and, as applicable with respect to Company Common Stock, a portion of any Working Capital Surplus as set forth in Section 2.13), and there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the shares of Company capital stock which were outstanding immediately prior to the Effective Time.  If, after the Effective Time, Certificates are presented to the Surviving Corporation or Parent for any reason, they shall be canceled and exchanged as provided in this Article II, except as otherwise provided by Applicable Law.

(e)           Termination of Rights as Stockholders.  Any Eligible Company Holders who fail to comply with this Article II at or prior to the Closing shall thereafter look only to Parent, and only as a general creditor, for payment of their claim for their portion of the Merger Consideration without interest (except such interest actually accrued on such delivered amount through the date delivered to Parent).

(f)            No Liability.  None of the Parties shall be liable to any Person in respect of any Merger Consideration (or dividends or distributions with respect thereto) delivered to a public official pursuant to any applicable abandoned property, escheat or similar Law.

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(g)           Lost Certificates.  If any Certificate shall have been lost, stolen or destroyed, upon (i) the delivery of a letter of transmittal, in form and substance reasonably acceptable to Parent and the Surviving Corporation, stating such fact, (ii) the making of an affidavit, in form and substance reasonably acceptable to Parent and the Surviving Corporation, of such fact by the Person claiming such Certificate to be lost, stolen or destroyed, (iii) evidence, in form and substance reasonably acceptable to Parent and the Surviving Corporation, that such Person is the beneficial owner of the Certificate claimed to be lost, stolen or destroyed, and, (iv) if required by Parent or the Surviving Corporation following the Effective Time, the making of an indemnity by such Person against any claim, or posting of a customary bond in such reasonable amount as Parent or the Surviving Corporation may require as indemnity against any claim, that may be made against the Parent or the Surviving Corporation with respect to such Certificate, Parent shall, pursuant to the terms and conditions of this Agreement, issue in exchange for such lost, stolen or destroyed Certificate the portion of the Merger Consideration into which such Certificate has been converted.

(h)           Certificate Legends.  The shares of Parent Common Stock to be issued pursuant to Section 2.7 shall not have been registered and shall be characterized as “restricted securities” under the federal securities Laws, and under such Laws such shares may be resold without registration under the Securities Act only in certain limited circumstances.  Each certificate evidencing shares of Parent Common Stock to be issued pursuant to Section 2.7 shall bear the following legend:

“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  SUCH SHARES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION WITHOUT AN OPINION OF LEGAL COUNSEL OR OTHER EVIDENCE REASONABLY ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.”

and any legends required by applicable state securities Laws.

Section 2.10           Withholding Rights.  Parent shall be entitled to deduct and withhold from the Merger Consideration otherwise payable pursuant to this Agreement to any Eligible Company Holder such amounts as the Surviving Corporation or Parent is required to deduct and withhold with respect to the making of such payment under the Code, or any Applicable Law.  To the extent that amounts are so withheld by the Surviving Corporation or Parent, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the holder in respect of which such deduction and withholding was made.

Section 2.11           Appraisal Rights.

(a)           The Company shall timely notify all eligible stockholders of the Company of their appraisal rights in accordance with Section 262 of the DGCL.

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(b)           Notwithstanding any provision of this Agreement to the contrary, shares of Company Common Stock that are outstanding immediately prior to the Effective Time and which are held by stockholders who have exercised and perfected appraisal rights for such shares of Company capital stock in accordance with the DGCL (collectively, the “Dissenting Shares”) shall not be converted into or represent the right to receive the Per Share Merger Consideration attributable to such Dissenting Shares.  Such stockholders shall be entitled to receive payment of the appraised value of such shares of Company Common Stock held by them in accordance with the DGCL, unless and until such stockholders fail to perfect or effectively withdraw or otherwise lose their appraisal rights under the DGCL.  All Dissenting Shares held by stockholders who shall have failed to perfect or who effectively shall have withdrawn or lost their right to appraisal of such shares of Company Common Stock under the DGCL shall thereupon be deemed to be converted into and to have become exchangeable for, as of the Effective Time, the right to receive the Per Share Merger Consideration attributable to such Dissenting Shares upon their surrender in the manner provided in Section 2.9.

(c)           The Company or the Surviving Corporation shall give Parent prompt written notice of any demands by dissenting stockholders received by the Surviving Corporation or the Company, withdrawals of such demands and any other instruments served on the Company or the Surviving Corporation and any material correspondence received by the Surviving Corporation or the Company in connection with such demands, and Parent shall have the right to direct all negotiations and proceedings with respect to such demands.  Neither the Company nor the Surviving Corporation shall, except with the prior written consent of Parent, make any payment with respect to any demands for appraisal or offer to settle or settle any such demands.

(d)           Notwithstanding any provision of this Agreement, including Section 2.7 or Article VIII, to the contrary, in the event that any payment is made to a holder of Dissenting Shares by the Surviving Corporation or Parent in respect of appraisal rights as contemplated by this Section 2.11(d), then (i) such holder’s former shares of Company Common Stock shall be removed from any calculation to determine the pro rata right of such holder to participate in any distribution of the Escrow Fund, and (ii) the portion of the Escrow Fund which would otherwise have represented the potential distribution to such holder shall instead be distributed to Parent.

Section 2.12           Further Assurances.  At and after the Effective Time, the officers and directors of the Surviving Corporation will be authorized (i) to execute and deliver, in the name and on behalf of the Company or Merger Sub, any deeds, bills of sale, assignments or assurances, and (ii) to take and do, in the name and on behalf of the Company or Merger Sub, any other actions and things to vest, perfect or confirm of record in the Surviving Corporation any and all right, title and interest in, to and under any of the rights, properties or assets acquired or to be acquired by the Surviving Corporation as a result of, or in connection with, the Merger.

Section 2.13           Arrangements Relating to Closing Date Working Capital Calculation.

(a)           No later than five (5) days before the Closing Date, the Company shall deliver to Parent a calculation of the Net Working Capital as of a date no more than one

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(1) month prior to the Closing Date (the “Pre-Closing Net Working Capital”), together with a balance sheet of the Company as of such date (the “Pre-Closing Balance Sheet”), which Pre-Closing Balance Sheet shall be in the same form as, and shall reflect the same accounting conventions as, the Company Balance Sheet.

(b)           If the Pre-Closing Net Working Capital is greater than $0, then notwithstanding anything herein to the contrary the Company shall be permitted to distribute to the Company’s stockholders entitled thereto prior to the Closing cash equal to the difference between the Pre-Closing Net Working Capital and $0 (the “Pre-Closing Distribution”).  If the Pre-Closing Net Working Capital is less than $0, the difference between $0 and the Pre-Closing Net Working Capital shall be the “Working Capital Purchase Price Reduction” and the Net Cash Payment Amount shall be reduced by such amount.

(c)           Within sixty (60) days following the Closing Date, the Stockholder Representative will prepare and deliver to Parent a calculation of the Closing Net Working Capital (the “Proposed Closing Net Working Capital Statement”), together with a balance sheet of the Company as of the Closing Date (the “Proposed Closing Balance Sheet”), which Proposed Closing Balance Sheet shall be in the same form as, and shall reflect the same accounting conventions as, the Company Balance Sheet.  The Stockholder Representative will make the work papers and back-up materials used in preparing the Proposed Closing Net Working Capital Statement, as well as the personnel with knowledge regarding any underlying matters, available to Parent and its advisors at reasonable times and upon reasonable notice.  For purposes hereof, both the Proposed Closing Net Working Capital Statement and the Proposed Closing Balance Sheet shall reflect any distributions made by the Company pursuant to Section 2.13(b) on a post-distribution basis.

(d)           If Parent shall fail to deliver to the Stockholder Representative a statement describing any objections to the Proposed Closing Net Working Capital Statement within ten (10) Business Days after receipt, then such Proposed Closing Net Working Capital Statement shall be deemed to be the “Stipulated Closing Net Working Capital Statement”.  However, if Parent shall deliver to the Stockholder Representative a statement describing any objections to the Proposed Closing Net Working Capital Statement within such ten (10) Business Day period, then the Stockholder Representative and the Company shall use commercially reasonable efforts to resolve, in good faith, any such objections with each other.  If Parent and the Stockholder Representative reach a resolution of all such objections, then the Proposed Closing Net Working Capital Statement as modified by such resolution shall be deemed to be the “Stipulated Closing Net Working Capital Statement”.  If such a resolution is not reached within ten (10) Business Days after the Stockholder Representative has received a statement describing Parent’s objections to the Proposed Closing Net Working Capital Statement, then any disputes regarding any accounting-related aspects of the calculation or computation of such Proposed Closing Net Working Capital Statement will be submitted promptly to a mutually acceptable independent accounting firm for resolution.  Parent, on the one hand, and the Stockholder Representative, on the other hand, may provide the accounting firm, within five (5) Business Days of its selection, with a definitive statement of their

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respective positions with respect to each unresolved objection.  The accounting firm will be provided with access to the books and records of the Stockholder Representative and the Company germane to the Proposed Closing Date Working Capital Statement.  The accounting firm will be asked to resolve any objections on an expedited basis, and shall in any event have no more than twenty (20) Business Days to carry out a review of the unresolved objections.  The accounting firm will be asked to prepare a written statement of its determination regarding each unresolved objection, and the Proposed Closing Date Working Capital Statement as modified by the accounting firm’s determination of Parent’s unresolved objections shall be deemed to be the “Stipulated Closing Net Working Capital Statement.”  The determination of the accounting firm will be conclusive and binding, absent manifest error.  If objections are submitted to the accounting firm for resolution as provided in this Section 2.13 and the Stockholder Representative prevails, by dollar amount, as to a majority of the objections asserted, then Parent shall pay all of the fees and expenses of the accounting firm.  If the Stockholder Representative does not prevail, by dollar amount, as to a majority of the objections asserted, then the fees and expenses of the accounting firm shall, for purposes of the Stipulated Closing Net Working Capital Statement, be treated as a current liability of the Company accrued and actually payable as of the Closing Date, and the Stipulated Closing Net Working Capital Statement shall be determined accordingly.

(e)           In the event that the Stipulated Closing Net Working Capital Statement reflects a Net Working Capital as of the Closing Date (the “Closing Net Working Capital”) that is greater than $0, then an amount equal to (i) the difference  between the Closing Net Working Capital and $0 (but in no event greater than $250,000), plus (ii) the amount of any Working Capital Purchase Price Reduction made pursuant to Section 2.13(b), if any (collectively, the “Working Capital Surplus”) shall be immediately distributed by Parent among all former holders of Company Common Stock entitled thereto as of the record date for the Pre-Closing Distribution, pro-rata based upon their respective holdings of Company Common Stock on such record date.  For the avoidance of doubt, the distribution of the Working Capital Surplus shall occur so as to replicate, in terms of the distribution among the former holders of Company Common Stock, the result that would otherwise have occurred had the Working Capital Surplus been included in the Pre-Closing Distribution.  In the event that the Stipulated Closing Net Working Capital Statement indicates a Closing Net Working Capital that is less than $0, then an amount equal to (i) the positive difference between $0 and such Closing Net Working Capital (the “Working Capital Deficit”), minus (ii) the amount of any Working Capital Purchase Price Reduction pursuant to Section 2.13(b), shall be immediately paid out of the Escrow Fund to Parent on a dollar-for-dollar basis, the amount of which payment shall be deemed to be a further reduction of the Merger Consideration.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

OF THE COMPANY AND PRINCIPAL STOCKHOLDERS

The Company and each of the Principal Stockholders represents and warrants to Parent and Merger Sub that as of the date of this Agreement (or, if made as of a specified date, as of such date) each of the statements contained in this Article III are true and correct, except as disclosed in a document of even date herewith and delivered by the Company to Parent on the date hereof referring to the representations and warranties in this Agreement (the “Company Disclosure Schedule”).  The Company Disclosure Schedule will be arranged in paragraphs corresponding to the numbered and lettered paragraphs contained in this Article III, and the disclosure in any such numbered and lettered section of the Company Disclosure Schedule shall qualify other sections in the Company Disclosure Schedule and other Schedules to this Agreement to the extent it is reasonably clear from a reading of the disclosure that such disclosure is applicable to such other sections or Schedules.  Any reference to or listing, description, disclosure or other inclusion of any item or other matter in the Company Disclosure Schedule shall not be construed to mean that such item or other matter is required to be referred to, listed, described, disclosed or otherwise so included in the Company Disclosure Schedule.  The reference to or listing, description, disclosure or other inclusion of any item or other matter, including any change, violation, breach, debt, obligation or liability, in the Company Disclosure Schedule shall not be construed to mean that such item or matter is material to the Company, has or would have a Material Adverse Effect, and shall not be construed to be an admission or suggestion that such item or matter constitutes a violation of or breach or default under, any contract, agreement, note, lease or otherwise.  Anything herein to the contrary notwithstanding, the Parties acknowledge and agree that no Party shall waive, or be deemed to have waived, any rights that it may have with respect to any third party by virtue of any disclosure by such Party that is contained in the Company Disclosure Schedule.

Section 3.1             Organization, Standing and Power.  The Company is a corporation duly organized, validly existing and in good standing under the Laws of the State of Delaware. The Company has the corporate power to own its properties and to carry on its business as now being conducted and as proposed to be conducted, and is duly qualified to do business and is in good standing in each jurisdiction where the character of the property owned or leased by it or the nature of the activities or business conducted by it makes such qualification necessary.  The Company has delivered a true and correct copy of the Organizational Documents of the Company, each as amended to date, to Parent.  The Company is not in violation of any of the provisions of its Organizational Documents.

Section 3.2             Authority.  The Company and each Principal Stockholder that is an entity has all requisite corporate or company power and authority to enter into this Agreement and to consummate the Contemplated Transactions.  The execution and delivery of this Agreement, the consummation of the Contemplated Transactions, and the performance by the Company and each Principal Stockholder that is an entity of its obligations hereunder have been duly authorized by all necessary corporate or company action on the part of the Company and each Principal Stockholder that is an entity subject (in the case of the Company) only to the approval of the Merger by the Company’s stockholders.  The affirmative vote of the holders of a majority

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of the shares of the Company Common Stock, outstanding on the record date relating to this Agreement and the Contemplated Transactions is the only vote of the holders of any of the Company’s capital stock necessary under Applicable Law to approve this Agreement and the Contemplated Transactions.  The Board of Directors of the Company has unanimously (a) approved this Agreement, the Merger and the other Contemplated Transactions; (b) determined that in its opinion the Contemplated Transactions are in the best interests of the stockholders of the Company and are on terms that are fair to such stockholders; and (c) recommended that the stockholders of the Company approve this Agreement and the Contemplated Transactions.  This Agreement has been duly executed and delivered by the Company and each of the Principal Stockholders and constitutes the valid and binding obligation of the Company and each of the Principal Stockholders enforceable against the Company and each of the Principal Stockholders in accordance with its terms, except that such enforceability may be limited by bankruptcy, insolvency, moratorium or other similar Laws affecting or relating to creditors’ rights generally, and is subject to general principles of equity.  The execution and delivery of this Agreement by the Company does not, and the consummation of the Contemplated Transactions will not, conflict with, or result in any violation of, or default under (with or without notice or lapse of time, or both), or give rise to a right of termination, cancellation or acceleration of any material obligation or loss of any material benefit under (a) any provision of the Organizational Documents of the Company, as amended; or (b) any material Contract or material Permit or material Order, or any Law applicable to any Company Party or any of their respective properties or assets.  No Consent or Order of, or registration, declaration or filing with, any Governmental Body is required by or with respect to any Company Party in connection with the execution and delivery of this Agreement or the consummation of the Contemplated Transactions, except for (a) the filing of the Agreement of Merger, together with the required officers’ certificates, and the filing of the Certificate of Merger; (b) any filings required under Regulation D of the Securities Act; and (c) such Consents, Orders, registrations, declarations and filings as may be required under applicable state securities Laws and the securities Laws of any foreign country.

Section 3.3             Intentionally Omitted.

Section 3.4             Financial Statements.

(a)           The Company has delivered to Parent its audited financial statements (balance sheet, statement of operations and statement of cash flows) for the fiscal year ended December 31, 2006, its compiled financial statements for the fiscal year ended December 31, 2005, its reviewed financial statements for the fiscal year ended December 31, 2004, and its unaudited financial statements (balance sheet, statement of operations and statement of cash flows) on a consolidated basis as at and for the six (6) month period ended June 30, 2007 (collectively, the “Company Financial Statements”).  The Company Financial Statements have been prepared in accordance with GAAP (except that the unaudited financial statements do not contain footnotes and are subject to normal recurring year-end audit adjustments, the effect of which will not, individually or in the aggregate, be materially adverse) applied on a consistent basis throughout the periods presented and consistent with each other.  The Company Financial Statements fairly present the consolidated financial condition, operating results and cash flow of the Company as of the dates, and for the periods, indicated therein, subject to normal year-end

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audit adjustments and the absence of footnotes in the case of unaudited Company Financial Statements, all in accordance with GAAP.

(b)           The Company maintains and will continue to maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements of the Company and to maintain accountability for assets; (iii) access to the Company’s assets is permitted only in accordance with management’s authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.  The Company is not party to or otherwise involved in any “off balance sheet arrangements” (as defined in Item 303 of Regulation S-K under the Exchange Act).

(c)           No Company Party is a party to, or has any commitment to become a party to, any joint venture, partnership or any similar Contract (including any Contract relating to any transaction or relationship between or among any Company Parties, on the one hand, and any unconsolidated Affiliate, including any structured finance, special purpose or limited purpose entity or Person, on the other hand), where the result, purpose or intended effect of such Contract is to avoid disclosure of any material transaction involving, or material liabilities of, any Company Party in the published financial statements of any Company Party.

Section 3.5             Capital Structure.  The authorized capital stock of the Company consists of 50,000,000 shares of Company Common Stock, of which there were issued and outstanding as of the close of business on the date hereof, 41,494,852 shares.  All outstanding shares of Company Common Stock are duly authorized, validly issued, fully paid and nonassessable and, to the Knowledge of the Company and the Principal Stockholders, are free of any Encumbrances, and are not subject to preemptive rights or rights of first refusal created by Applicable Law, the Organizational Documents of the Company or any Contract to which the Company is a party or by which it is bound.  As of that same date, there were 4,240,829 shares of Company Common Stock reserved for issuance under the Company Stock Plan, of which 2,415,404 shares were subject to outstanding options and 1,825,425 shares were reserved for future option grants.  The Company has delivered to Parent true, correct and complete copies of each form of agreement or stock option plan evidencing each Company Stock Option.  Except for the rights created pursuant to this Agreement and the rights disclosed in this Section 3.5, there are no other options, warrants, calls, rights, commitments or agreements of any character to which the Company is a party or by which it is bound, obligating the Company to issue, deliver, sell, repurchase or redeem or cause to be issued, delivered, sold, repurchased or redeemed, any shares of capital stock of the Company or obligating the Company to grant, extend, accelerate the vesting of, change the price of, or otherwise amend or enter into any such option, warrant, call, right, commitment or agreement.  All shares of Company Common Stock issuable upon exercise of the options described in this Section 3.5 will be, when issued pursuant to the respective terms of such options, duly authorized, validly issued, fully paid and nonassessable.  There are no other Contracts relating to voting, purchase or sale of the capital stock of the Company (a) between or among the Company and any of its stockholders; and (b) to the Company’s Knowledge, between or among any of the Company’s stockholders.  All shares of outstanding Company Common

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Stock and rights to acquire capital stock of the Company were issued in compliance with all applicable federal and state securities Laws.  There are no accrued but unpaid dividends on shares of the Company’s capital stock as of the date of this Agreement and, except as contemplated by Section 2.13(e), there will be no accrued by unpaid dividends on shares of the Company’s capital stock as of the Effective Time.

Section 3.6             Subsidiaries.

(a)           Section 3.6 of the Company Disclosure Schedule sets forth the name, jurisdiction of incorporation, capitalization, and the record holders of the capital stock of each Subsidiary of the Company.  Except as set forth in Section 3.6 of the Company Disclosure Schedule, the Company does not own, directly or indirectly, any capital stock or other equity securities in any other Person other than publicly traded securities constituting less than five percent (5%) of the outstanding equity of the issuing entity.

(b)           Each Subsidiary of the Company is duly organized, validly existing and in good standing under the Laws of its jurisdiction of organization, and has the corporate power to own its properties and to carry on its business as now being conducted and as proposed to be conducted.  Each Subsidiary of the Company is duly qualified to do business and is in good standing in each jurisdiction where the character of the property owned or leased by it or the nature of its activities or the business conducted makes such qualification necessary.  The Company has heretofore delivered to Parent true, correct and complete copies of the Organizational Documents of each of its Subsidiaries.  No Subsidiary is in default or in violation of any provision of its Organizational Documents.

(c)           All shares of capital stock of, or other ownership interests in, Subsidiaries of the Company owned, directly or indirectly, by the Company are owned free and clear of any Encumbrance and free of any other limitation or restriction (including any restriction on the right to vote, sell or otherwise dispose of such capital stock or other ownership interests), except for limitations or restrictions under Applicable Laws.  There are no outstanding options, warrants or other rights to acquire from any Company Party, and no preemptive or similar rights, subscriptions or other rights, convertible or exchangeable securities or Contracts of any character, relating to any equity interest in any Subsidiary of the Company, obligating any Company Party to issue, transfer or sell, any capital stock, voting securities or other ownership interests in, or any securities convertible into or exchangeable for any capital stock, voting securities or ownership interests in, any Subsidiary of the Company or obligating any Company Party to grant, extend or enter into any such option, warrant, subscription or other right, convertible or exchangeable security or Contract.  There are no outstanding obligations of any Company Party to repurchase, redeem or otherwise acquire from any Person (other than the Company or a wholly-owned Subsidiary of the Company) any outstanding shares of capital stock of any Subsidiary of the Company.

Section 3.7             Absence of Certain Changes.  Since December 31, 2006 (the “Company Balance Sheet Date”), the Company has conducted its business in the ordinary course consistent with past practice and there has not occurred (a) any change, event or condition (whether or not covered by insurance) that has resulted in, or could reasonably be expected to result in, a

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Company Material Adverse Effect; (b) any acquisition, sale or transfer of any asset of any Company Party other than in the ordinary course of business and consistent with past practice; (c) any change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by any Company Party or any revaluation by any Company Party of any of its assets; (d) any declaration, setting aside, or payment of a dividend or other distribution with respect to the shares of capital stock or other ownership interests of any Company Party or any direct or indirect redemption, purchase or other acquisition by any Company Party of any of its shares of capital stock or other ownership interests; (e) the execution of any Material Contract by any Company Party, or any material amendment or termination of, or default under, any Material Contract to which any Company Party is a party or by which it is bound; (f) any amendment or change to the Organizational Documents of any Company Party; (g) any increase in or modification of the compensation or benefits payable or to become payable by any Company Party to any of its directors or employees; (h) any split, combination or reclassification of any of the Company’s capital stock; (i) any changes or events (including the incurrence of any liabilities of any nature, whether or not accrued, contingent, absolute, determined, determinable, asserted, unasserted or otherwise) which, individually or in the aggregate, would have a Company Material Adverse Effect; or (j) any agreement by any Company Party to do any of the things described in the preceding clauses (a) through (i).

Section 3.8             Absence of Undisclosed Liabilities.  There are no liabilities of any Company Party of any kind whatsoever, whether accrued, contingent, absolute, determined, determinable, asserted, unasserted or otherwise, other than (a) liabilities disclosed in or provided for in the Company Financial Statements or in the notes thereto, (b) liabilities incurred in the ordinary course of business that are not required by GAAP to be reflected on a balance sheet or to be disclosed in the footnotes thereof, and (c) any liability in excess of $25,000 that was incurred in the ordinary course of business since June 30, 2007.

Section 3.9             Litigation.  There are no Proceedings (or, to the Knowledge of any Company Party, any basis therefor), whether at law or equity or otherwise, by or before any Governmental Body or arbitrator, foreign or domestic, or, to the Knowledge of any Company Party, threatened against or involving any Company Party or any of their respective properties or officers or directors (in their capacities as such).  There is no Order involving the Company or any of its Subsidiaries, or, to the Knowledge of any Company Party, any of their respective directors or officers (in their capacities as such), that could prevent, enjoin, or materially alter, delay or encumber any of the Contemplated Transactions, or that would have a Material Adverse Effect on any Company Party.

Section 3.10           Restrictions on Business Activities.  There is no Contract or Order binding upon any Company Party that has or could reasonably be expected to have the effect of prohibiting or materially impairing any current or future business practice of any Company Party, any acquisition of property by any Company Party or the conduct of business by any Company Party as currently conducted or as proposed to be conducted by any Company Party.

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Section 3.11           Intellectual Property.

(a)           For purposes of this Agreement, “Intellectual Property” means all rights in:

(i)            all issued patents, reissued or reexamined patents, revivals of patents, utility models, certificates of invention, registrations of patents and extensions thereof, regardless of country or formal name (collectively, “Issued Patents”);

(ii)           all published or unpublished nonprovisional and provisional patent applications, reexamination proceedings, invention disclosures and records of invention (collectively “Patent Applications” and, with the Issued Patents, the “Patents”);

(iii)          all industrial design registrations or applications (including any continuations, divisionals, continuations-in-part, renewals, issues and applications for any of the foregoing), and rights to apply for any of the foregoing;

(iv)          all copyrights, copyrightable works, semiconductor topography and mask work rights, including all rights of authorship, use, publication, reproduction, distribution, performance transformation, moral rights and rights of ownership of copyrightable works, semiconductor topography works and mask works, and all rights to register and obtain renewals and extensions of registrations, together with all other interests accruing by reason of international copyright, semiconductor topography and mask work conventions (collectively, “Copyrights”);

(v)           trademarks, registered trademarks, applications for registration of trademarks, service marks, registered service marks, applications for registration of service marks, trade names, registered trade names and applications for registrations of trade names, logos, slogans (collectively, “Trademarks”) and domain name registrations;

(vi)          all ideas, inventions, designs, manufacturing and operating specifications, and technical data;

(vii)         all computer programs, hardware, software programs or applications (in both source and object code form and including firmware), including any related technical documentation, user or operator manuals, software libraries, compilers, configurations, databases, schematics, diagrams, components, processes and methodologies related to any of the foregoing (“Software Programs”);

(viii)        technology, trade secrets and proprietary or other confidential information, know-how, proprietary processes, formulae, algorithms, models and

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methodologies, whether or not protectable as a matter of law (collectively, “Trade Secrets”);

(ix)           all other intellectual or other proprietary rights protectable as a matter of law;

(x)            licenses, immunities, covenants not to ▇▇▇ and the like relating to any of the foregoing;

(xi)           any claims or causes of action arising out of or related to any infringement, misuse or misappropriation of any of the foregoing;

(xii)          all other intangible assets, goodwill, properties and rights (whether or not appropriate steps have been taken to protect, under Applicable Law, such other intangible assets, properties or rights);

(xiii)         all moral rights, including any rights of paternity or integrity, and right of restraint, any right to claim authorship of any of the foregoing, to object to any distortion, mutilation or other modification of, or other derogatory action in relation to, any of the foregoing, whether or not such would be prejudicial to honor or reputation, and any similar right, existing under judicial or statutory Law of any country in the world, or under any treaty, regardless whether or not such right is denominated or generally referred to as a “moral” right (“Moral Rights”); and

(xiv)        rights of publicity and privacy related to the use of the names, likenesses, voices, signatures and biographical information of real persons.

(b)           No product liability claims have been communicated in writing to or, to the Knowledge of any Company Party, threatened against, any Company Party.

(c)           A true and complete list of each of the Company Software Programs, together with a brief description of each important feature, part and/or component thereof, is set forth in Section 3.11(c) of the Company Disclosure Schedule.  Section 3.11(c) of the Company Disclosure Schedule sets forth a true and complete list of each license, sublicense and other Contract as to which any Company Party is a party and pursuant to which any Company Party owns or is authorized to use any Company Software Programs, or any feature or part or component thereof, and includes the identity of all parties thereto, a description of the nature and subject matter thereof and the term thereof.  The Company Software Programs conform in all material respects with any specification, documentation, performance standard, representation or statement provided with respect thereto by or on behalf of any Company Party.

(d)           Section 3.11(d) of the Company Disclosure Schedule contains a true, correct and complete list of all of each Company Party’s U.S. and foreign (i) Patents and Patent Applications, (ii) Trademark registrations and applications therefor and material unregistered Trademarks; (iii) Copyright registrations and applications therefor; and

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(iv) other filings and formal actions made or taken pursuant to federal, state, local and foreign Laws by any Company Party to protect its or their interests in the Company Intellectual Property.  The Company or the applicable Subsidiary is listed in the records of the appropriate U.S., state or foreign registry as the sole current owner of record for each listed application or registration, and no third party has any ownership interest, or right to claim any ownership interest in any listed application or registration.  With respect to the listed applications and registrations, each such application or registration has been prosecuted or maintained, as the case may be, in compliance in all material respects with all applicable rules, policies and procedures of the appropriate U.S., state or foreign registry.

(e)           The Company Intellectual Property consists solely of items and rights that are: (i) owned by a Company Party; (ii) in the public domain; or (iii) rightfully used by the Company Parties pursuant to a valid license or similar agreement (the “Company Licensed Intellectual Property”).  The Company Parties have (whether by virtue of ownership, license or otherwise) all rights in the Company Intellectual Property necessary to carry out the business of the Company Parties as currently conducted or contemplated to be conducted, including, to the extent required to carry out such activities, rights to make, have made, sell, offer for sale, import, export, use, reproduce, modify, adapt, create derivative works based on, translate, distribute (directly and indirectly), transmit, display and perform publicly, escrow, maintain, license, rent, lease, assign and sell the Company Intellectual Property in all geographic locations where currently sold or used, and to sublicense any or all of the foregoing rights to third parties, including the right to grant further sublicenses.

(f)            To the Knowledge of the Company Parties, the conduct of the business of the Company Parties as conducted in the past did not infringe (when conducted) and as currently conducted or contemplated to be conducted does not infringe (either directly or indirectly, such as through contributory infringement) any Intellectual Property right owned or controlled by any third party.  There is no pending or, to the Knowledge of the Company, threatened, Proceeding (or any basis therefor) before any Governmental Body in any jurisdiction, whether against any Company Party or any third party, (i) involving any Company Intellectual Property owned by any Company Party, or, to the Knowledge of the Company, any Company Licensed Intellectual Property; (ii) alleging that the activities or the conduct of the business of any Company Party, or the use of any Company Intellectual Property by any customer or other licensee of any Company Party, does or will infringe upon, violate or constitute the unauthorized use of the Intellectual Property rights of any third party; or (iii) challenging the ownership, use, validity, enforceability or registrability of any Company Intellectual Property, nor, to the Knowledge of the Company, is there any reasonable basis for any such Proceeding.  Other than license agreements entered into by the Company Parties in the ordinary course of business and identified on Section 3.11(f) of the Company Disclosure Schedule, there are no settlements, forbearances to ▇▇▇, consent judgments or Orders or similar obligations binding upon any Company Party or, to the Knowledge of the Company Parties, upon any third party, which (a) restrict the Company’s or any of its Subsidiaries’ rights to use any Company Intellectual Property, (b) restrict the Company’s or its Subsidiaries’ business in order to accommodate a third party’s Intellectual Property rights

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or (c) permit a third party to use any Company Intellectual Property owned by any Company Party.  To the Knowledge of the Company (x) all registered, granted or issued Patents, mask works, Trademarks and Copyrights registered by or assigned to any Company Party are valid and enforceable and (y) there is no pending denial, refusal or similar action by any Governmental Body with respect to any Patent, Copyright or Trademark application filed by or on behalf of any Company Party.  To the Company’s Knowledge, there is no unauthorized use, infringement or misappropriation of any of the Company Intellectual Property owned by any Company Party by any third party, including any current or former employee or contractor of any Company Party (or their respective predecessors-in-interest).  No Company Party is subject to any Proceeding or Order restricting in any manner the use, transfer or licensing of any Company Intellectual Property by any Company Party, or which may affect the validity, use or enforceability of such Company Intellectual Property.  No Company Party is subject to any Contract that restricts in any material respect the use, transfer, delivery or licensing by any Company Party of the Company Intellectual Property.  No Company Party has entered into any agreement to indemnify any Person against any charge of misappropriation, violation or infringement of any Company Intellectual Property, other than indemnification provisions contained in purchase orders or license agreements of a Company Party arising in the ordinary course of business.

(g)           To the Knowledge of the Company Parties, there are no royalties, fees, honoraria or other payments payable by any Company Party to any Person by reason of the ownership, development, use, license, sale or disposition of any Company Intellectual Property, other than salaries and sales commissions paid to employees and sales agents in the ordinary course of business.

(h)           All current and former directors, officers, employees and agents of any Company Party or any of their predecessors-in-interest, and all current and former consultants, contractors and similar third parties who have performed any activities on behalf of any Company Party or any of their predecessors-in-interest, or who have participated in the development or creation of any Company Intellectual Property; either (i) have been a party to a “work-for-hire” arrangement or agreement with the Company or a Subsidiary that has accorded the Company or such Subsidiary, as the case may be, full, effective, exclusive and original ownership of all Intellectual Property thereby arising, in accordance with Applicable Law, or (ii) have executed appropriate instruments of assignment in favor of the Company or a Subsidiary as assignee that have conveyed to the Company or such Subsidiary, as the case may be, effective and exclusive ownership of all Intellectual Property thereby arising.  The Company Parties have provided to Parent copies of all Contracts referenced or described in this Section 3.11(h).  All current and former directors, officers, employees, consultants, contractors and agents of each Company Party who have participated in the development or creation of any Company Intellectual Property have waived, released or made covenants not to assert against the Company Parties any Moral Rights or other common law or statutory rights in or to any Company Intellectual Property.  No current or former director, officer, employee, contractor, consultant or agent of any Company Party (or their respective predecessors-in-interest), will, after giving effect to the Contemplated Transactions, own or retain any rights in or to any of the Company Intellectual Property.  To the Knowledge of the

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Company Parties, no director, officer, employee, contractor, consultant or agent of any Company Party is in breach of any agreement with any former employer or other third party concerning Intellectual Property rights or confidentiality.

(i)            No Company Party is, or as a result of the execution or delivery of this Agreement, or performance of the Company’s obligations hereunder, will be, in violation of any Contract to which any Company Party is a party or otherwise bound, nor will execution or delivery of this Agreement, or performance of the Company’s obligations hereunder, cause the diminution, termination, transfer or forfeiture of any of the rights of any Company Party in any Company Intellectual Property or require the Consent of any Governmental Body or third party in respect of any such Company Intellectual Property.  To the Knowledge of the Company, each such Contract constitutes the valid and binding obligation of all parties thereto, enforceable in accordance with its terms, and, to the Knowledge of the Company, there exists no breach by any party thereto and no event or circumstance which will result in a violation or breach of, or constitute (with or without due notice or lapse of time or both) a default by any Company Party thereunder.

(j)            To the Knowledge of the Company, there has been no misuse or misappropriation of any Company Intellectual Property by any third party.  The Company Parties have taken reasonable measures to protect the proprietary nature of the Company Intellectual Property that is material to the business of any Company Party as currently conducted.  Without limitation of the foregoing, the source code and technical documentation (excluding end user documentation) relating to all Company Software Programs (i) have at all times been maintained in strict confidence, (ii) have been disclosed by the Company Parties only to employees who have had a “need to know” the contents thereof in connection with the performance of their duties to the applicable Company Party and who have executed appropriate nondisclosure or similar agreements, and (iii) except pursuant to an agreement listed in Section 3.11(o) of the Company Disclosure Schedule, have not been licensed or disclosed to or escrowed for the benefit of or to be made available to any third party.  No third party has made any claim or delivered any notice that any third party is entitled to access or receive the source code for any Company Software Program pursuant to any source code escrow agreement identified or required to be identified on Section 3.11(c) of the Company Disclosure Schedule.  The Company Parties have possession or control of a true and complete gold master copy of the source code for each of the Company Software Programs, including each feature, part and/or component thereof.

(k)           Section 3.11(k) of the Company Disclosure Schedule contains a complete list of (i) all software libraries, compilers and other third-party software sold with, incorporated into or used in the development or operation of the Software Programs, and (ii) all material third-party software systems and applications used in the business of the Company Parties.  Section 3.11(k) of the Company Disclosure Schedule is a true and complete list of all license agreements by which the Company Parties are bound for the use of any Company Software Program and, if any such software is not licensed, the basis of the use of any Company Software Program by the Company Parties.  The use or incorporation, as applicable, of each feature, part or component of the Company Software Programs by the Company Parties has been in material compliance with the respective

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license agreement or other right of use listed for such item on Section 3.11(k) of the Company Disclosure Schedule.

(l)                                     To the Knowledge of the Company, no portion of any Company Software Program, at the time of delivery of such Software Program (i) contains any “back door,” “time bomb,” “Trojan horse,” “worm,” “drop dead device,” “lock-out,” “virus” or other software routines or hardware components designed to permit unauthorized access; to disable or erase software, hardware, or data; or to perform any other similar unauthorized actions; or (ii) fails to comply with any applicable warranty or other contractual commitment relating to the use, functionality or performance of such Company Software Program or any product or system containing or used in conjunction with such Company Software Program. The Company has made available to Parent a complete and accurate list of all material bugs, defects and errors of which any Company Party has Knowledge in each version and component of each Company Software Program.

(m)                               To the Knowledge of the Company Parties, no Company Software Program or component thereof or any services provided by any Company Party contains any Public Software. With respect to items set forth on Section 3.11(m) of the Company Disclosure Schedule, if any, the applicable license terms do not (i) require, or condition the use of distribution of any Company Software Program on the disclosure, licensing or distribution of any source code for any portion of such Company Software Program or (ii) otherwise impose any limitation, restriction or condition on the right or ability of any Company Party to use or distribute any Company Software Program.

(n)                                 No funding, facilities or personnel of any Governmental Body were used, directly or indirectly, to develop or create, in whole or in part, any Company Intellectual Property (excluding Company Licensed Intellectual Property). No Company Party (including their respective predecessors-in-interest) is now or was ever a member or promoter of, or a contributor to, any industry standards body or similar organization that could require or obligate any Company Party to grant or offer to any third party any license or right to any Company Intellectual Property.

(o)                                 Section 3.11(o) of the Company Disclosure Schedule sets forth a true and complete list of each license, sublicense and other Contract as to which any Company Party is a party and pursuant to which any Company Party owns or is authorized to use any Company Intellectual Property, or feature or part or component thereof, and includes the identity of all parties thereto, a description of the nature and subject matter thereof and the term thereof. The Company Parties have made available to Parent true and correct copies of all Contracts relating to the Company Intellectual Property, including (A) any standard form agreements used by the Company Parties to license software and or services, (B) professional services agreements, (C) third-party non-disclosure agreements, (D) third-party consultant or independent contractor agreements, and (E) employee offer letters and terms of employment or equivalent, and (F) all agreements listed in Sections 3.11(c), (f), (h), (k) and (o) of the Company Disclosure Schedule.

(p)                                 The activities of the Company Parties have at all times been conducted in full compliance with applicable import and export control Laws. Without limitation of

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the foregoing, the Company Parties have obtained all required licenses, clearances and classifications in connection with the sale and distribution by the Company Parties of any Company Software Program.

Section 3.12                                Interested Party Transactions. No Company Party is indebted to any of its Representatives (except for amounts due as normal salaries and bonuses and in reimbursement of ordinary expenses), and no such Person is indebted to any Company Party. There have been no transactions since January 1, 2006 that would require disclosure if the Company were subject to disclosure under Item 404 of Regulation S-K under the Securities Act.

Section 3.13                                Minute Books. The minute books (or similar records) of the Company Parties contain a materially complete and accurate summary of all meetings of directors and stockholders (or other applicable governing bodies and equity owners) or actions by written consent since the time of formation of the Company Parties through the date of this Agreement, and reflect all transactions referred to in such minutes accurately in all material respects.

Section 3.14                                Complete Copies of Materials. The Company has delivered or made available true and complete copies of each document in its possession that has been requested by Parent or its counsel in connection with their due diligence review of the Company Parties.

Section 3.15                                Material Contracts. All of the Material Contracts are listed in Section 3.15 of the Company Disclosure Schedule. With respect to each Material Contract:  (a) the Material Contract is legal, valid, binding and enforceable and in full force and effect with respect to the applicable Company Party, and, to the Knowledge of the Company Parties, is legal, valid, binding, enforceable and in full force and effect with respect to each other party thereto, in either case subject to the effect of bankruptcy, insolvency, moratorium or other similar Laws affecting the enforcement of creditors’ rights generally and except as the availability of equitable remedies may be limited by general principles of equity; (b) the Material Contract will continue to be legal, valid, binding and enforceable and in full force and effect immediately following the Effective Time in accordance with its terms as in effect prior to the Effective Time, subject to the effect of bankruptcy, insolvency, moratorium or other similar Laws affecting the enforcement of creditors’ rights generally and except as the availability of equitable remedies may be limited by general principles of equity; and (c) neither the applicable Company Party nor, to the Knowledge of the Company Parties, any other party is in breach or default, and no event has occurred that with notice or lapse of time would constitute a breach or default by the applicable Company Party or, to the Knowledge of the Company Parties, by any such other party, or permit termination, modification or acceleration, under such Material Contract. “Material Contract” means all Contracts to which the Company or any Subsidiary of the Company is a party or by which any of them or any of their respective properties or assets may be bound (i)  which contain provisions granting the customer the use of products of the Company other than for the customer’s internal business use or without restricting the number of either CPUs or users or on an “enterprise” or similar basis; (ii) pursuant to which the customer will own any Intellectual Property developed or generated by any Company Party; (iii) pursuant to which source code is either provided to the customer or placed in escrow; (iv) which permit the customer to transfer, assign or sublicense Company Intellectual Property rights without the Company’s consent, other than rights transferred by operation of law; (v) which include provisions containing, or that are otherwise subject to, non-competition, exclusivity, non-solicitation of the employees of the other

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party thereto, or “most favored nation” or similar pricing arrangements, or other similar restrictions on any Company Party; (vi) which contain provisions for liquidated damages or penalties upon termination in an amount greater than $10,000 or indemnification provisions that materially deviate from the Company’s and the Subsidiaries’ standard practice; (vii) with any Representative or Affiliate of any Company Party; (viii) under which there remains any obligation or liability of any Company Party for the sale or lease of any of the assets of any Company Party other than in the ordinary course of business; (ix) which following the Effective Time will create a restriction on the business or operations of any Affiliate of the Surviving Corporation which is not as of the date hereof an Affiliate of the Company; (x) which provide for the payment by or to any Company Party of an amount greater than $10,000 per annum; (xi) which commit any Company Party to purchase a minimum quantity of goods or services other than de minimus amounts under equipment leases; (xii) which bear on the Company’s ownership or right to exploit the Company Software Programs (other than off-the-shelf, third party Software Programs and not including standard form agreements with the Company’s employees and consultants), including licenses of components or modules (other than any such licenses entered into in the ordinary course of business), service and support agreements (other than such agreements entered into in the ordinary course of business), and third party source code escrows; or (xiii) which are material to any Company Party’s business or operations.

Section 3.16                                Inventory. The inventories shown on the Company Balance Sheet or thereafter acquired by the applicable Company Party were acquired and maintained in the ordinary course of business, are of good and merchantable quality, and consist of items of a quantity and quality usable or salable in the ordinary course of business. Since the Company Balance Sheet Date, the Company Parties have continued to replenish inventories in a normal and customary manner consistent with past practices. The Company Parties have not received notice that any of them will experience in the foreseeable future any difficulty in obtaining, in the desired quantity and quality and at a reasonable price and upon reasonable terms and conditions, the raw materials, supplies or component products required for the manufacture, assembly or production of their respective products or providing of their respective services. The values at which inventories are carried reflect the inventory valuation policy of the Company Parties, which is consistent with their respective past practice and in accordance with GAAP. No Company Party is under any liability or obligation with respect to the return of any item of inventory in the possession of wholesalers, retailers or other customers.

Section 3.17                                Accounts Receivable. Subject to any reserves set forth therein, the accounts receivable shown on the Company Financial Statements are valid and genuine, have arisen solely out of bona fide sales and deliveries of goods, performance of services, and other business transactions in the ordinary course of business consistent with past practices (and do not include any ▇▇▇▇ and hold, extended trial or on approval arrangements or end of quarter channel filling incentive sales) in each case with Persons other than Affiliates, are not subject to any prior assignment or Encumbrance, and are not subject to valid defenses, set-offs or counterclaims. The accounts receivable are collectible in accordance with their terms at their recorded amounts, subject only to the reserve for doubtful accounts on the Company Financial Statements.

Section 3.18                                Customers and Suppliers. Section 3.18 of the Company Disclosure Schedule sets forth for 2006 and the first six months of 2007 (i) the twenty-five largest customers of the Company and its Subsidiaries in terms of revenue recognized during the applicable period,

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(ii) the ten (10) largest suppliers of the Company and its Subsidiaries in terms of costs recognized for the purchase of products or services during the applicable period, and (iii) all representatives, resellers or distributors of the Company (whether pursuant to commission, royalty or other arrangement), (collectively, the “Customers, Suppliers, Resellers and Partners”). The Company does not know of any plan or intention of any of the Customers, Suppliers, Resellers and Partners, and the Company has not received any written or oral threat from any of the Customers, Suppliers, Resellers and Partners, to terminate, cancel, fail to renew or extend, or otherwise adversely modify its relationship with any Company Party or to decrease materially or limit its products or services to any Company Party or its usage, purchase or distribution of the services or products of any Company Party. To the Knowledge of the Company Parties, no Customer Supplier, Reseller or Partner is insolvent or has filed or is planning to file for bankruptcy relief protection or other similar insolvency Laws.

Section 3.19                                Employees and Consultants. Section 3.19 of the Company Disclosure Schedule contains a list of the names of all employees (including part-time employees and temporary employees), leased employees, independent contractors and consultants of the Company Parties, together with their respective salaries or wages, other compensation, dates of employment and positions.

Section 3.20                                Title to Property.

(a)                                  The Company Parties have good and marketable title to all of their properties, interests in properties and assets, real and personal, reflected in the Company Balance Sheet or acquired after the Company Balance Sheet Date (except properties, interests in properties and assets sold or otherwise disposed of since the Company Balance Sheet Date in the ordinary course of business), or with respect to leased or licensed properties and assets, valid leasehold interests therein or licenses thereto, free and clear of Encumbrances of any kind or character, other than Permitted Encumbrances.

(b)                                 The plants, property and equipment of the Company Parties that are used in the operations of their respective businesses are in all material respects in good operating condition and repair, subject to normal wear and tear. All properties used in the operations of the Company Parties are reflected in the Company Balance Sheet to the extent required by GAAP. All leases and licenses to which any Company Party is a party are in full force and effect and are valid, binding and enforceable in accordance with their respective terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium or other similar Laws affecting or relating to creditors’ rights generally; and general principles of equity, regardless of whether asserted in a proceeding in equity or at law. True and correct copies of all such leases and licenses have been provided to Parent.

(c)                                  Section 3.20(c) of the Company Disclosure Schedule sets forth a complete list and the location of all real property that is used by any Company Party or that is reflected as an asset of the Company on the Company Balance Sheet (the “Real Property”).

(d)                                 No Company Party owns any Real Property.

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(e)                                  The Company has previously provided to Parent true, correct and complete copies of all leases related to Real Property (collectively, the “Real Property Leases”). Each Real Property Lease is valid, binding and enforceable against the applicable Company Party, and, to the Knowledge of Company Parties, the other parties thereto in accordance with its terms and is in full force and effect, except, in the case of enforceability against the other parties thereto, as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors’ rights, and to general equity principles. The leasehold estate created by each Real Property Lease is free and clear of all Encumbrances. There are no existing defaults by any Company Party under any of the Real Property Leases, nor, to the Knowledge of the Company Parties, has an event occurred that (whether with or without notice, lapse of time or the happening or occurrence of any other event) would constitute a default under any Real Property Lease.

(f)                                    There are no Proceedings, disputes or conditions affecting any Real Property that could materially curtail or interfere with the use of such property. Neither the whole nor any portion of the Real Property nor any other assets of any Company Party is subject to any Order to be sold or is being condemned, expropriated or otherwise taken by any Governmental Body with or without payment of compensation therefor, nor, to the Knowledge of the Company, has any such condemnation, expropriation or taking been proposed. No Company Party is a party to any lease, assignment or similar arrangement under which the Company is a lessor, assignor or otherwise makes available for use by any third party any portion of the Real Property. There is no equipment located on the premises of the Company or used in the business of the Company that is on loan from another party.

(g)                                 No Company Party has received any notice of, or other writing referring to, any requirements or recommendations by any insurance company that has issued a policy covering any part of the Real Property or by any board of fire underwriters or other body exercising similar functions, requiring or recommending any repairs or work to be done on any part of the Real Property, which repair or work has not been completed.

Section 3.21                                Environmental Matters.

(a)                                  The following terms shall be defined as follows:

(i)                                     “Environmental Laws” shall mean any Applicable Laws, policies, Permits, Orders, directives, or requirements that pertain to the protection of the environment, protection of public health and safety, or protection of worker health and safety, or that pertain to the handling, use, manufacturing, processing, storage, treatment, transportation, discharge, release, emission, disposal, re-use, recycling, or other contact or involvement with Hazardous Materials (as defined in Section 3.21(a)(ii)), including the federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Section 9601, et seq., as amended (“CERCLA”), the federal Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., as amended (“RCRA”), and the

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Massachusetts Oil and Hazardous Material Release Prevention and Response Act, M.G.L. c. 21E.

(ii)                                  “Hazardous Materials” shall mean any material, chemical, compound, substance, mixture or by product that is identified, defined, designated, listed, restricted or otherwise regulated under Environmental Laws as a “hazardous constituent,” “hazardous substance,” “hazardous material,” “acutely hazardous material,” “extremely hazardous material,” “hazardous waste,” “hazardous waste constituent,” “acutely hazardous waste,” “extremely hazardous waste,” “infectious waste,” “medical waste,” “biomedical waste,” “pollutant,” “toxic pollutant,” “contaminant” or any other formulation or terminology intended to classify or identify substances, constituents, materials or wastes by reason of properties that are deleterious to the environment, natural resources, worker health and safety, or public health and safety, including ignitability, corrosivity, reactivity, carcinogenicity, toxicity and reproductive toxicity. The term “Hazardous Materials” shall include any “hazardous substances” as defined, listed, designated or regulated under CERCLA, any “hazardous wastes” or “solid wastes” as defined, listed, designated or regulated under RCRA, any asbestos or asbestos containing materials, any polychlorinated biphenyls, and any petroleum or hydrocarbonic substance, fraction, distillate or by product.

(b)                                 The Company Parties are and have been in compliance with all Environmental Laws relating to the properties or facilities used, leased or occupied by any of them at any time (collectively, the “Company Party Facilities,” such properties or facilities currently used, leased or occupied by the Company Parties are defined herein as the “Company Party Current Facilities”), and no discharge, emission, release, leak or spill of Hazardous Materials has occurred at any of the Company Party Facilities that may or will give rise to liability of any Company Party under Environmental Laws. To the Knowledge of the Company Parties, there are no Hazardous Materials (including asbestos) present in the surface waters, structures, groundwaters or soils of or beneath any of the Company Party Current Facilities. To the Knowledge of the Company Parties, there neither are nor have been any aboveground or underground storage tanks for Hazardous Materials at the Company Party Current Facilities. To the Knowledge of the Company Parties, no employee of any Company Party or any other Person has claimed that any Company Party is liable for alleged injury or illness resulting from an alleged exposure to a Hazardous Material. No Proceeding is pending against any Company Party, or, to the Knowledge of any Company Party, threatened against any Company Party, with respect to Hazardous Materials or Environmental Laws; and no Company Party is aware of any facts or circumstances that could form the basis for assertion of a claim against any Company Party or that could form the basis for liability of any Company Party, regarding Hazardous Materials or regarding actual or potential noncompliance with Environmental Laws.

Section 3.22                                Taxes.

(a)                                  The Company Parties have timely filed (or caused to be filed) all Tax Returns required to be filed by them, and all such Tax Returns are true, complete and

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correct. All such Tax Returns have accurately reflected the Tax liability of the Company Parties for the periods covered thereby. The Company has made available to Parent copies of all Tax Returns filed by each Company Party for all periods since the formation of such Company Party, or for all periods commencing on or after January 1, 2003, whichever is less.

(b)                                 The Company Parties have withheld and timely paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder or other party.

(c)                                  The Company Parties have paid and discharged (or caused to be paid and discharged) all Taxes reflected on the Tax Returns which have become due and payable by them. The Company Parties have made provision for all Taxes payable by the Company Parties for which no Tax Return has yet been filed and the charges, accruals and reserves for Taxes with respect to the Company Parties reflected on the Pre-Closing Company Balance Sheet are adequate under GAAP to cover the Tax liabilities accruing through the date thereof.

(d)                                 No Tax Return of any Company Party is under audit or examination by any taxing authority, and no notice of such an audit or examination has been received by any Company Party. There is no deficiency, refund litigation, proposed adjustment or matter in controversy with respect to any Taxes due and owing by any Company Party. Any deficiency resulting from any completed audit or examination relating to Taxes by any taxing authority has been timely paid, except for such deficiencies being contested in good faith or for which adequate reserves are reflected on the Pre-Closing Company Balance Sheet. The Tax Returns of the Company Parties have been either examined and settled with the relevant taxing authority or closed by virtue of the applicable statute of limitations and no requests for waivers of the time to assess any such Taxes are pending. There are no pending requests for rulings or determinations with respect to any Tax matter. The Company Parties have no Knowledge of threatened actions or proceedings for the assessment or collection of any Tax with respect to the Company Parties, nor have the Company Parties received any notice or inquiry from any jurisdiction in which they do not currently file Tax Returns to the effect that such Party may be subject to Tax by such jurisdiction.

(e)                                  To the Knowledge of the Company Parties, no Encumbrances for Taxes (other than for Taxes not yet due and payable) exist with respect to any assets or properties of any Company Party.

(f)                                    There are no outstanding waivers or agreements extending the statute of limitation or the period for assessment, reassessment or collection of any amount of Taxes to which the Company Parties may be subject or relating to any of their assets, and no power of attorney that is currently in force has been granted with respect to any matter relating to Taxes that could affect the Company Parties or their property or assets.

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(g)                                 The Company Parties have disclosed on their federal income Tax Returns all positions taken therein that could give rise to a substantial understatement of federal income Tax within the meaning of Section 6662 of the Code.

(h)                                 The Company Parties have not participated in a “listed transaction” within the meaning of Treasury Regulations Section 1.6011-4(c)(3)(i)(A).

(i)                                     The Company Parties are not doing business in or engaged in a trade or business in any jurisdiction in which they have not filed all required Tax Returns.

(j)                                     No Company Party is or has been a party to any tax sharing agreement, tax allocation agreement, tax indemnity obligation or similar written or unwritten agreement, arrangement or understanding or practice with respect to Taxes (including any advance pricing agreement, closing agreement or other arrangement relating to Taxes). No Company Party has entered into a closing agreement pursuant to Section 7121 of the Code or any equivalent provision of any other Applicable Law.

(k)                                  No Company Party has been a member of any affiliated group within the meaning of Section 1504(a) of the Code, or any similar affiliated or consolidated group for Tax purposes under state, local or foreign Law (other than a group the common parent of which is the Company). No Company Party is liable for any Tax imposed on any entity under Treasury Regulation §1.1502-6 (or any similar provision of state, local, or foreign tax Law) as a transferee or successor, by Contract, or otherwise.

(l)                                     No Company Party is the beneficiary of any arrangement described in Treasury Regulation Section 1.6011-4(b)(2)(or any similar arrangement) with respect to any transaction or Tax opinion. No Company Party is a party to any understanding or arrangement, or has otherwise participated in any transaction, described in Section 6111(c) of the Code or Section 6112(b) of the Code (or any similar provision). No Company Party has received any written Tax opinions from outside law or accounting firms with respect to any transaction relating to any Company Party other than a transaction in the ordinary course of business.

(m)                               No Company Party has been a “distributing corporation” or a “controlled corporation” in a distribution of stock to any person qualifying for tax-free treatment under Section 355 of the Code, either in the two (2) years prior to the date of this Agreement, or in a distribution which could otherwise constitute part of a “plan” or “series of related transactions” (within the meaning of Section 355(e) of the Code) in conjunction with the Contemplated Transactions.

(n)                                 No Company Party has participated in or cooperated with an international boycott within the meaning of Section 999 of the Code or has been requested to do so in connection with any transaction or proposed transaction.

(o)                                 No Company Party has agreed to make, nor have they been notified of a requirement to make, any adjustment under Section 481(a) of the Code (or any similar provision of state, local or foreign tax Law) by reason of a change in accounting method

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or otherwise for any Tax period for which the applicable federal statute of limitations has not yet expired.

(p)                                 None of the property owned by any Company Party is “tax-exempt use property” within the meaning of Section 168(h) of the Code. No Company Party is party to a lease other than a lease that has been treated for U.S. federal income tax purposes as a “true” lease under which such entities own or use the property subject to the lease. No Company Party is party to a lease arrangement involving a defeasance of rent, interest or principal.

(q)                                 No Company Party or any other Person on behalf of any Company Party has entered into any agreement or consent pursuant to Section 341(f) of the Code.

(r)                                    No Company Party has been a United States real property holding corporation within the meaning of Section 897(c)(2) of the Code during the applicable period specified in Section 897(c)(1)(A)(ii) of the Code.

(s)                                  No Company Party is a party to any Contract, plan or arrangement, including the provisions of this Agreement, covering any employee or former employee of such Company Party that, individually or collectively, could give rise to the payment of any amount that would not be deductible pursuant to Sections 280G, 464 or 162(m) of the Code by the Company or as an expense under Applicable Law.

Section 3.23                                Employee Benefit Plans.

(a)                                  Section 3.23(a) of the Company Disclosure Schedule contains a complete and accurate list of each plan, program, policy, practice, contract, agreement or other arrangement providing for employment, compensation, retirement, deferred compensation, loans, severance, separation, relocation, repatriation, expatriation, visas, work permits, termination pay, performance awards, bonus, incentive, stock option, stock purchase, stock bonus, phantom stock, stock appreciation right, supplemental retirement, fringe benefits, cafeteria benefits or other benefits, whether written or unwritten, including each “employee benefit plan” within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), which is or has been sponsored, maintained, contributed to, or required to be contributed to by any Company Party or by any trade or business (whether or not incorporated) that is or at any relevant time was treated as a single employer with any Company Party within the meaning of Section 414(b), (c), (m) or (o) of the Code, (an “ERISA Affiliate”) for the benefit of any person who performs or who has performed services for any Company Party or with respect to which any Company Party or any ERISA Affiliate has or may have any liability (including contingent liability) or obligation (collectively, the “Company Employee Plans”). Section 3.23(a) of the Company Disclosure Schedule separately lists each Company Employee Plan that has been adopted or maintained by any Company Party, whether formally or informally, for the benefit of employees outside the United States (collectively, the “Company International Employee Plans”).

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(b)                                 Documents. The Company has made available to Parent true, correct and complete copies of documents embodying each of the Company Employee Plans and related plan documents, including trust documents, group annuity contracts, plan amendments, insurance policies or contracts, participant agreements, employee booklets, administrative service agreements, summary plan descriptions, compliance and nondiscrimination tests for the last three plan years, standard COBRA forms and related notices, registration statements and prospectuses and, to the extent still in the possession of the Company Parties, any material employee communications relating thereto. With respect to each Company Employee Plan that is required to file Form 5500, the Company has provided or made available copies of the Form 5500 reports filed for the last three (3) plan years. The Company has provided or made available to Parent the most recent Internal Revenue Service determination or opinion letter issued with respect to each such Company Employee Plan, and to the Knowledge of the Company Parties nothing has occurred since the issuance of each such letter that could reasonably be expected to cause the loss of the tax qualified status of any Company Employee Plan subject to Code Section 401(a). The Company has also provided or made available to Parent, with respect to each Company Employee Plan, (i) a copy of the two most recent annual reports and actuarial reports, if required under ERISA, and the most recent report prepared with respect thereto in accordance with Statement of Financial Accounting Standards No. 87; and (ii) if the Employee Plan is funded through a trust or any third party funding vehicle, a copy of the latest financial statements thereof.

(c)                                  Compliance.

(i)                                     Each Company Employee Plan and each related funding arrangement has been established, administered and maintained in accordance with its terms and in compliance with the requirements prescribed by any and all Applicable Law (including ERISA and the Code), and each Company Party and each ERISA Affiliate of any Company Party has performed all material obligations required to be performed by them under, are not in material respect in default under or violation of and have no Knowledge of any material default or violation by any other party to, any of the Company Employee Plans.

(ii)                                  Any Company Employee Plan intended to be qualified under Section 401(a) of the Code has either obtained from the Internal Revenue Service a favorable determination letter as to its qualified status under the Code, including all currently effective amendments to the Code, or has time remaining to apply under applicable Treasury Regulations or Internal Revenue Service pronouncements for a determination or opinion letter and to make any amendments necessary to obtain a favorable determination or opinion letter.

(iii)                               None of the Company Employee Plans promises or provides retiree medical or other retiree welfare benefits to any Person, other than post-employment benefits provided in accordance with Section 4980B of the Code or comparable state law.

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(iv)                              None of the Company Employee Plans is a self-insured “multiple employer welfare arrangement” (as defined in Section 3(40) of ERISA).

(v)                                 There has been no “prohibited transaction,” as such term is defined in Section 406 of ERISA or Section 4975 of the Code, with respect to any Company Employee Plan.

(vi)                              No Company Party or any ERISA Affiliate is subject to any material liability or penalty under Sections 4976 through 4980 of the Code or Title I of ERISA with respect to any Company Employee Plan.

(vii)                           All contributions required to be made by any Company Party or any ERISA Affiliate of any Company Party to any Company Employee Plan have been paid or accrued.

(viii)                        With respect to each Company Employee Plan, no “reportable event” within the meaning of Section 4043 of ERISA (excluding any such event for which the thirty (30) day notice requirement has been waived under the regulations to Section 4043 of ERISA) nor any event described in Section 4062, 4063 or 4041 or ERISA has occurred.

(ix)                                Each Company Employee Plan has prepared in good faith and timely filed all requisite governmental reports, which were true and correct as of the date filed, and has properly and timely filed and distributed or posted all notices and reports to employees required to be filed, distributed or posted with respect to each such Company Employee Plan.

(x)                                   No suit, administrative proceeding, action or other litigation has been brought, or to the Knowledge of any Company Party is threatened, against or with respect to any Company Employee Plan (and to the Knowledge of the Company Parties there is no basis therefor), including any audit or inquiry by the IRS or United States Department of Labor.

(xi)                                There has been no amendment to, written interpretation or announcement by any Company Party or any ERISA Affiliate of any Company Party that would materially increase the expense of maintaining any Company Employee Plan above the level of expense incurred with respect to that Company Employee Plan for the most recent fiscal year included in the Company Financial Statements.

(xii)                             Each Company Employee Plan that is a nonqualified deferred compensation plan within the meaning of Section 409A of the Code has been operated in compliance with said Section such that no individual would be liable for interest or additional tax thereunder.

(d)                                 No Title IV or Multiemployer Plan. No Company Party or any ERISA Affiliate of any Company Party has ever maintained, established, sponsored, participated

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in, contributed to, or is obligated to contribute to, or otherwise incurred any obligation or liability (including any contingent liability) under any “multiemployer plan” (as defined in Section 3(37) of ERISA) or to any “pension plan” (as defined in Section 3(2) of ERISA) subject to Title IV of ERISA or Section 412 of the Code. No Company Party or any ERISA Affiliate has any actual or potential withdrawal liability (including any contingent liability) for any complete or partial withdrawal (as defined in Sections 4203 and 4205 of ERISA) from any multiemployer plan.

(e)                                  COBRA; FMLA; HIPAA; Cancer Rights. With respect to each Company Employee Plan, each Company Party has complied with (i) the applicable health care continuation and notice provisions of the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) and the regulations thereunder, as well as any applicable state Law governing health care coverage extension or continuation; (ii) the applicable requirements of the Family and Medical Leave Act of 1993 and the regulations thereunder; (iii) the applicable requirements of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”); and (iv) the applicable requirements of the Women’s Health and Cancer Rights Act of 1998. No Company Party has any material unsatisfied obligations to any employees, former employees or qualified beneficiaries pursuant to COBRA, HIPAA or any state Law governing health care coverage extension or continuation.

(f)                                    Effect of Transaction. The consummation of the Contemplated Transactions will not (i) entitle any current or former employee or other service provider of any Company Party or any ERISA Affiliate to severance benefits or any other payment (including unemployment compensation, golden parachute, bonus or benefits under any Company Employee Plan), except as expressly provided in this Agreement; or (ii) accelerate the time of payment or vesting of any such benefits or increase the amount of compensation due any such employee or service provider. No benefit payable or that may become payable by any Company Party to any Company Employee Plan or as a result of or arising under this Agreement shall constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code) subject to the imposition of an excise Tax under Section 4999 of the Code or the deduction for which would be disallowed by reason of Section 280(G) of the Code. Each Company Employee Plan can be amended, terminated or otherwise discontinued after the Effective Time in the sole discretion of the Company and in accordance with its terms, without material liability to Parent or any Company Party other than ordinary administration expenses typically incurred in a termination event. Neither the execution of this Agreement nor the consummation of the Contemplated Transactions shall constitute an event causing the Company to fund any “rabbi” or similar trust.

(g)                                 International Employee Plans. Each of the Company International Employee Plans has been established, maintained and administered in compliance in all material respects with its terms and conditions and with the requirements prescribed by any and all statutory or regulatory Laws applicable to such International Company Employee Plan. No Company International Employee Plan has unfunded liabilities that as of the Effective Time will not be offset by insurance or fully accrued. No condition

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exists that would prevent any Company Party or Parent from terminating or amending any International Company Employee Plan at any time for any reason.

(h)                                 Massachusetts Law. The Company Parties are in compliance in all material respects with the applicable provisions of Chapter 58 of the Commonwealth of Massachusetts Acts of 2006, “An Act Providing Access to Affordable, Quality Accountable Health Care” (the “Massachusetts Health Care Act”) and the regulations promulgated thereunder. The Company Parties have properly classified and accounted for all part time personnel (including seasonal and temporary personnel) and independent contractors in a manner that complies with the Massachusetts Health Care Act. The Company Parties make, or make available, a fair share contribution towards the costs of health care for their employees to the extent required by the Massachusetts Health Care Act.

Section 3.24                                Employee Matters. Each Company Party is in compliance with all Applicable Laws respecting terms and conditions of employment, including applicant and employee background checking, immigration Laws, discrimination Laws, verification of employment eligibility, employee leave Laws, classification of workers as employees and independent contractors, wage and hour Laws, and occupational safety and health Laws. There are no Proceedings pending or, to the Knowledge of the Company Parties, reasonably expected or threatened, between the applicable Company Party, on the one hand, and any or all of its current or former employees, on the other hand, including any claims for actual or alleged harassment or discrimination based on race, national origin, age, sex, sexual orientation, religion, disability, or similar tortious conduct, breach of contract, wrongful termination, defamation, intentional or negligent infliction of emotional distress, interference with contract or interference with actual or prospective economic advantage. There are no claims pending, or, to the Knowledge of the Company Parties, reasonably expected or threatened, against the applicable Company Party under any workers’ compensation or long term disability plan or policy. No Company Party has any material unsatisfied obligations to any employees, former employees, or qualified beneficiaries pursuant to COBRA, HIPAA, or any state Law governing health care coverage extension or continuation. No Company Party is a party to any collective bargaining agreement or other labor union contract, and the Company does not know of any activities or proceedings of any labor union to organize the employees of any Company Party. Each Company Party has provided or shall as of the Closing Date have provided all employees with all wages, benefits, relocation benefits, stock options, bonuses and incentives, and all other compensation that became due and payable through the date of this Agreement and that shall become due and payable through the Closing Date.

Section 3.25                                Insurance. Section 3.25 of the Company Disclosure Schedule sets forth a list of all material policies or binders of fire, liability, product liability, workmen’s compensation, vehicular, directors’ and officers’ and other insurance held by or on behalf of the Company Parties. Such policies and binders are in full force and effect, are reasonably believed by the Company to be adequate for the businesses engaged in by the Company Parties and are in conformity in all material respects with the requirements of all Contracts to which each Company Party is a party and are valid and enforceable in accordance with their terms. No Company Party is in default with respect to any provision contained in any such policy or binder nor has any Company Party failed to give any notice or present any claim under any such policy

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or binder in due and timely fashion. There are no outstanding unpaid claims under any such policy or binder. No Company Party has received notice of cancellation or non-renewal of any such policy or binder.

Section 3.26                                Compliance with Laws.

(a)                                  Each Company Party has complied with, is not in violation of and has not received any notices of violation with respect to, any Applicable Law with respect to the conduct of its business, or the ownership or operation of its business.

(b)                                 The Company Parties have conducted their business and operations in compliance in all material respects with all Applicable Laws, including import and export compliance Laws and Laws relating to data privacy.

(c)                                  Each Company Party has obtained and, where applicable renewed, each Permit necessary to the ownership of its properties or to the conduct of its business, and, after giving effect to the Contemplated Transactions, all such Permits will continue to be valid and in full force. The Company Parties are in compliance with the terms of all Permits applicable to the Company Parties in all material respects.

(d)                                 Section 3.26 of the Company Disclosure Schedule sets forth each Contract that materially deviates from the standard procedures or standard provisions of the Company Parties with respect to import or export compliance or data privacy.

Section 3.27                                Absence of Questionable Payments. No Company Party or any director, officer, agent, employee or other Person acting on behalf of any Company Party has used any corporate or other funds for unlawful contributions, payments, gifts or entertainment, or made any unlawful expenditures relating to political activity to government officials or others or established or maintained any unlawful or unrecorded funds that would result in a violation of Section 30A of the Exchange Act if such provision were applicable to such Company Party. No Company Party or any current director, officer, agent, employee or other person acting on behalf of any Company Party, has accepted or received any unlawful contributions, payments, gifts or expenditures. The Company Parties are in compliance with the provisions of Section 13(b) of the Exchange Act.

Section 3.28                                Brokers’ and Finders’ Fee. No broker, finder or investment banker is entitled to brokerage or finders’ fees or agents’ commissions or investment bankers’ fees or any similar charges in connection with the Merger, this Agreement or any of the Contemplated Transactions.

Section 3.29                                Privacy Policies and Web Site Terms and Conditions.

(a)                                  For purposes of this Section 3.29:

(i)                                     “Company Sites” means all public sites of the Company Parties on the World Wide Web.

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(ii)                                  “Privacy Statements” means, collectively, any and all privacy policies of the Company Parties published on the Company Sites or otherwise made available by the Company Parties regarding the collection, retention, use and distribution of the personal information of individuals, including from visitors of any of the Company Sites (“Individuals”); and

(iii)                               “Terms and Conditions” means any and all of the visitor terms and conditions published on the Company Sites governing Individuals’ use of and access to the Company Sites.

(b)                                 A Privacy Statement is posted and is accessible to Individuals at all times on each Company Site. The Company maintains a hypertext link to a Privacy Statement from the homepage of each Company Site, and the Company uses its best efforts to include a hypertext link to a Privacy Statement from every page of the Company Sites on which personal information is collected from Individuals.

(c)                                  The Privacy Statements include, at a minimum, notice to Individuals about the Company Parties’ collection, retention, use and disclosure policies and practices with respect to Individuals’ personal information. The Privacy Statements are, in all material respects, accurate and consistent with the Terms and Conditions and the Company Parties’ actual practices (subject to reinforcement by the Company upon any identified lapses) with respect to the collection, retention, use and disclosure of Individuals’ personal information.

(d)                                 The Company Parties employ reasonable and prudent measures designed to insure that the Company Parties (i) comply with the Privacy Statements as applicable to any given set of personal information collected by the Company Parties from Individuals; (ii) comply with all applicable privacy Laws regarding the collection, retention, use and disclosure of personal information; and (iii) take all appropriate and industry standard measures to protect and maintain the confidential nature of the personal information provided to the Company Parties by Individuals. The Company Parties have adequate technological and procedural measures in place to protect personal information collected from Individuals against loss, theft and unauthorized access or disclosure. The Company Parties do not knowingly collect information from or target children under the age of thirteen. The Company Parties do not sell, rent or otherwise make available to third parties any personal information submitted by Individuals.

(e)                                  The collection, retention, use and distribution by the Company Parties of all personal information collected by the Company Parties from Individuals is governed by the Privacy Statement pursuant to which the data was collected. Each Privacy Statement contains rules for the review, modification and deletion of personal information by the applicable Individual, and the Company Parties are and have been at all times in compliance with such rules in all material respects. All versions of the Privacy Statements are attached hereto in Section 3.29(e) of the Company Disclosure Schedule. Other than as constrained by the Privacy Statements and by Applicable Laws, the Company Parties are not restricted in their use and/or distribution of personal information collected by them.

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(f)                                    The Company Parties have the full power and authority to transfer all rights the Company Parties have in all Individuals’ personal information in the Company Parties’ possession and/or control to Parent. The Privacy Statements expressly permit the transfer of all personal information collected from Individuals by the Company Parties in accordance with the acquisition or sale of all or substantially all of the assets of the Company. The Company Parties are not a party to any Material Contract, or subject to any other obligation that, following the Effective Time, would prevent Parent and/or its Affiliates from using the information governed by the Privacy Statements in a manner consistent with applicable privacy Laws regarding the disclosure and use of information. No claims or controversies have arisen regarding the Privacy Statements or the implementation thereof or of any of the foregoing.

(g)                                 The Terms and Conditions are posted and are accessible to Individuals at all times on the Company Site. The Terms and Conditions expressly permit the transfer of personal information collected from Individuals by the Company Parties in accordance with the acquisition or sale of all or substantially all of the assets of the Company Parties. No claims or controversies have arisen regarding the Terms and Conditions or the implementation thereof or of any of the foregoing.

Section 3.30                                International Trade Matters. The Company Parties are, and at all times have been, in compliance with and have not been and are not in material violation of any International Trade Law, including all Laws related to the import and export of commodities, software, and technology from and into the United States, and the payment of required duties and tariffs in connection with same. The Company Parties have no basis to expect, nor has any of them or any other Person for whose conduct they are or may be held to be responsible received, any actual or threatened Order, notice, or other communication from any Governmental Body of any actual or potential violation or failure to comply with any International Trade Law. “International Trade Law” shall mean Laws applicable to international transactions, including the Export Administration Act, the Export Administration Regulations, the Foreign Corrupt Practices Act, the Arms Export Control Act, the International Traffic in Arms Regulations, the International Emergency Economic Powers Act, the Trading with the Enemy Act, the U.S. Customs Laws, the Foreign Asset Control Regulations, and any regulations or orders issued thereunder.

Section 3.31                                Representations Complete. None of the representations or warranties made by any Company Party herein or in any Schedule or Exhibit hereto, including the Company Disclosure Schedule, or certificate furnished by any Company Party pursuant to this Agreement or any written statement furnished to Parent pursuant hereto or in connection with the Contemplated Transactions, when all such documents are read together in their entirety, contain any untrue statement of a material fact, or omits to state any material fact necessary in order to make the statements contained herein or therein, in the light of the circumstances under which made, not misleading.

Section 3.32                                Commission Filings. No Company Party is required to file any forms, reports, schedules, statements or other documents with the SEC.

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Section 3.33                                Takeover Statutes. The Board of Directors of the Company has taken the necessary action to render Section 203 of the DGCL and any other potentially applicable anti-takeover statute or regulation inapplicable to this Agreement and the Contemplated Transactions.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF PARENT AND SUB

Parent and Merger Sub represent and warrant to the Company that the statements contained in this Article IV are true and correct, except as disclosed in a document of even date herewith and delivered by Parent to the Company on the date hereof referring to the representations and warranties in this Agreement (the “Parent Disclosure Schedule”). The Parent Disclosure Schedule will be arranged in sections corresponding to the lettered and numbered paragraphs contained in this Article IV, and the disclosure in any such numbered and lettered section of the Parent Disclosure Schedule shall qualify only the corresponding section in this Article V (except to the extent disclosure in any numbered and lettered section of the Parent Disclosure Schedule is specifically cross-referenced in another numbered and lettered section of the Parent Disclosure Schedule).

Section 4.1                                      Organization, Standing and Power. Each of Parent and Merger Sub is a corporation duly organized, validly existing and in good standing under the Laws of the state of Delaware. Each of Parent and Merger Sub has the corporate power to own its properties and to carry on its business as now being conducted and as proposed to be conducted and is duly qualified to do business and is in good standing in each jurisdiction where the character of the property owned or leased by it or the nature of the activities or business conducted by it makes such qualification necessary. Parent has delivered a true and correct copy of the Certificate of Incorporation and Bylaws or other charter documents, as applicable, of Parent and Merger Sub, each as amended to date, to the Company. Neither Parent nor Merger Sub is in violation of any of the provisions of its Certificate of Incorporation or Bylaws.

Section 4.2                                      Authority. Parent and Merger Sub have all requisite corporate power and authority to enter into this Agreement and to consummate the Contemplated Transactions. The execution and delivery of this Agreement and the consummation of the Contemplated Transactions have been, or will have been by the Closing, duly authorized by all necessary corporate action on the part of Parent and Merger Sub. This Agreement has been duly executed and delivered by Parent and Merger Sub and constitutes the valid and binding obligation of Parent and Merger Sub enforceable against Parent and Merger Sub in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting or relating to creditors’ rights generally, and subject to general principles of equity. The execution and delivery of this Agreement do not, and the consummation of the Contemplated Transactions will not, conflict with, or result in any violation of, or default under (with or without notice or lapse of time, or both), or give rise to a right of termination, cancellation or acceleration of any material obligation or loss of a material benefit under (a) any provision of the Certificate of Incorporation or Bylaws of Parent or any of its Subsidiaries; or (b) any material Contract, Permit, Order or Law applicable to Parent or any of its Subsidiaries or their respective properties or assets. No Consent or Order of or registration, declaration or filing with any Governmental Body is required by or with respect to Parent or any of its Subsidiaries in

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connection with the execution and delivery of this Agreement by Parent and Merger Sub or the consummation by Parent and Merger Sub of the Contemplated Transactions, except for (a) the filing of the Agreement of Merger, together with the required officers’ certificates, and the filing of the Certificate of Merger; (b) any filings required under Regulation D of the Securities Act following the Effective Time; (c) the filing of a Form 8-K with the SEC within fifteen (15) days after the Closing Date; and (d) such Consents, Orders, registrations, declarations and filings as may be required under applicable state securities Laws and the securities Laws of any foreign country.

Section 4.3                                      Issuance of Shares. The issuance and delivery of the Parent Common Stock as Merger Consideration in accordance with this Agreement shall be, at or prior to the Effective Time, duly authorized by all necessary corporate action on the part of Parent, and, when issued at the Effective Time as contemplated hereby, such shares of Parent Common Stock will be duly and validly issued, fully paid and nonassessable. Such Parent Common Stock, when so issued and delivered in accordance with the provisions of this Agreement, shall be free and clear of all liens and encumbrances and adverse claims, other than restrictions on transfer created by applicable securities Laws and will not have been issued in violation of their respective properties or any preemptive rights or rights of first refusal or similar rights.

Section 4.4                                      Interim Operations of Merger Sub. Merger Sub was formed solely for the purpose of engaging in the Contemplated Transactions, has engaged in no other business activities and has conducted its operations only as contemplated by this Agreement.

Section 4.5                                      Finders’ or Advisors’ Fees. Except for Software Equity Group, LLC, there is no investment banker, broker, finder or other intermediary which has been retained by or is authorized to act on behalf of Parent and Merger Sub who might be entitled to any fee or commission in connection with the Contemplated Transactions.

Section 4.6                                      SEC Filings; Financial Statements.

(a)                                  Parent has timely filed all registration statements, prospectuses, forms, reports, definitive proxy statements, schedules and documents required to be filed by it under the Securities Act or the Exchange Act, as the case may be, since January 1, 2005 (collectively, the “Parent SEC Filings”). Each Parent SEC Filing, (i) as of its date, complied in all material respects with the requirements of the Securities Act or Exchange Act, as the case may be, and (ii) did not, at the time it was filed, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.

(b)                                 Each of the consolidated financial statements (including in each case, any notes thereto) contained in any Parent SEC Filings was prepared in accordance with GAAP (except as may be indicated in the notes thereto and, in the case of unaudited quarterly financial statements, as permitted by Form 10-Q under the Exchange Act), and each presented fairly the consolidated financial position, results of operations and cash flows of Parent as of the respective dates thereof and for the respective periods indicated therein (subject, in the case of unaudited statements, to normal and recurring year-end

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adjustments which did not and would not, individually or in the aggregate, reasonably be expected to have a material and adverse effect to the business, condition (financial or other), results of operations, performance or properties of Parent, taken as a whole).

Section 4.7                                      Absence of Certain Changes or Events. Except as disclosed in Parent SEC Filings filed with the SEC prior to the date hereof, since December 31, 2006, Parent has conducted its business only in the ordinary course and there has not been: (i) any change in or effect on the assets, liabilities, financial condition, operating results or business of Parent, except changes or effects which (x) have not been, in the aggregate, materially adverse, (y) relate, in general, to the economy or securities markets of the United States or any other region, or (z) relate to the industry in which Parent operates generally; (ii) any declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property) with respect to any of Parent’s capital stock; (iii) any split, combination or reclassification of any of Parent’s capital stock or any issuance (or the authorization of any issuance) of any other securities in respect of, in lieu of or in substitution for shares of Parent’s capital stock; (iv) any damage, destruction or loss, whether or not covered by insurance, which would have a material adverse effect on the assets, liabilities, financial condition, operating results or prospects of Parent; or (v) any change in accounting methods, principles or practices by Parent materially affecting its assets, liabilities, financial condition or operating results, except insofar as may have been required by a change in GAAP.

ARTICLE V

ADDITIONAL AGREEMENTS

Section 5.1                                      Conduct of Business of the Company. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, the Company agrees (except to the extent expressly contemplated by this Agreement or as consented to in writing by Parent) to (and to cause each other Company Party to):  (a) carry on its business in the usual regular and ordinary course in substantially the same manner as heretofore conducted; (b) pay its debts and Taxes when due subject (i) to good faith disputes over such debts or Taxes; and (ii) to Parent’s consent to the filing of material Tax Returns, if applicable; (c) pay or perform other obligations when due; and (d) use all reasonable efforts to preserve intact its present business organizations, keep available the services of its present officers and key employees and preserve its relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, to the end that its goodwill and ongoing businesses shall be unimpaired at the Effective Time. The Company agrees to promptly notify Parent of (a) any event or occurrence not in the ordinary course of the business of any Company Party, and of any event which could reasonably be expected to have a Material Adverse Effect on any Company Party; and (b) any change in its capitalization as set forth in Section 3.5. Without limiting the foregoing, except as expressly contemplated by this Agreement or the Company Disclosure Schedule, the Company shall not do, cause or permit (or cause or permit any other Company Party to do, cause or permit) any of the following, without the prior written consent of Parent:

(a)                                  Charter Documents. Cause or permit any amendments to its Organizational Documents;

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(b)                                 Dividends, Changes in Capital Stock. Declare or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any of its capital stock (except such dividends as may be permitted pursuant to Section 2.13(b)), or split, combine or reclassify any of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock, or repurchase or otherwise acquire, directly or indirectly, any shares of its capital stock except from former employees, directors and consultants in accordance with agreements providing for the repurchase of shares in connection with any termination of service to it;

(c)                                  Stock Option Plans, Etc. Accelerate, amend or change the period of exercisability or vesting of options or other rights granted under its stock plans or authorize cash payments in exchange for any options or other rights granted under any of such plans;

(d)                                 Issuance of Securities. Issue, deliver or sell or authorize or propose the issuance, delivery or sale of, or purchase or propose the purchase of, any shares of its capital stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue any such shares or other convertible securities other than the issuance of shares of its Common Stock pursuant to the exercise of stock options, warrants or other rights therefore outstanding as of the date of this Agreement;

(e)                                  Intellectual Property. Transfer to any person or entity any rights to its Intellectual Property other than in the ordinary course of business consistent with past practice;

(f)                                    Exclusive Rights. Enter into or amend any agreements pursuant to which any other party is granted exclusive marketing or other exclusive rights of any type or scope with respect to any of the Company Software Programs or Company Intellectual Property;

(g)                                 Dispositions. Sell, lease, license or otherwise dispose of or encumber any of its properties or assets that are material, individually or in the aggregate, to its business, taken as a whole;

(h)                                 Pledges, Etc. Sell or pledge or agree to sell or pledge any stock or other equity interest owned by it in any other entity;

(i)                                     Indebtedness. Incur any indebtedness for borrowed money, or guarantee any such indebtedness, or issue or sell any debt securities or guaranty any debt securities of others, in excess of $10,000 in the aggregate;

(j)                                     Agreements. Other than Contracts in the Company’s standard form with customers entered into in the ordinary course of business, enter into, terminate or amend, in a manner that will adversely affect the business of any Company Party, (i) any Contract involving the obligation to pay or the right to receive $10,000 or more, (ii) any

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Contract relating to the license, transfer or other disposition or acquisition of Intellectual Property rights or rights to market or sell the Company Software Programs or (iii) any other Contract material to the business or prospects of the Company or that is or would be a Material Contract;

(k)                                  Payment of Obligations. Pay, discharge or satisfy, in an amount in excess of $10,000 in the aggregate, any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise) arising other than in the ordinary course of business, other than the payment, discharge or satisfaction of liabilities reflected or reserved against in the Company Financial Statements;

(l)                                     Accounts Payable. Delay or postpone the payment of accounts payable or other liabilities, other than in the ordinary course of business consistent with past practice;

(m)                               Capital Expenditures. Make any capital expenditures, capital additions or capital improvements, in excess of $10,000 in the aggregate;

(n)                                 Insurance. Materially reduce the amount of any material insurance coverage provided by existing insurance policies;

(o)                                 Termination or Waiver. Terminate or waive any right of substantial value, other than in the ordinary course of business;

(p)                                 Employee Benefit Plans, New Hires, Pay Increases. Amend any Company Employee Plan or adopt any plan that would constitute a Company Employee Plan except in order to comply with applicable Laws, or hire any new officer-level employee, pay any special bonus, special remuneration or special noncash benefit (except payments and benefits made pursuant to written agreements outstanding on the date hereof), or increase the benefits, salaries or wage rates of its employees;

(q)                                 Acceleration of Payments. Except as required by Article II, accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;

(r)                                    Severance Arrangements. Grant or pay any severance or termination pay or benefits (i) to any director or officer or (ii) except for payments made pursuant to written agreements outstanding on the date hereof and disclosed on the Company Disclosure Schedule, to any other employee;

(s)                                  Lawsuits. Commence or settle a lawsuit other than (i) for the routine collection of bills, (ii) in such cases where the Company in good faith determines that failure to commence suit or settle would result in the material impairment of a valuable aspect of the Company’s business, provided that it consults with Parent prior to the filing or settling of such a suit or (iii) for a breach of this Agreement;

(t)                                    Acquisitions. Acquire or agree to acquire by merging with, or by purchasing a substantial portion of the stock or assets of, or by any other manner, any

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business or any Person or division thereof or otherwise acquire or agree to acquire any assets that are material individually or in the aggregate, to its business, taken as a whole;

(u)                                 Dispositions. Transfer or agree to transfer by merging into or consolidating with, or by selling a substantial portion of the stock or assets of, or by any other manner, any business or any Person or division thereof or otherwise transfer or agree to transfer any assets that are material individually or in the aggregate, to the business of any Company Party, taken as a whole;

(v)                                 Anti-takeover Statutes. Take any action to exempt or make any Person (other than Parent) not subject to the provisions of Section 203 of the DGCL or any other potentially applicable anti-takeover or similar Law;

(w)                               Other Actions. Take any action (including encouraging any other Person to take such action), engage in any transaction or enter into any Contract which would reasonably be likely to cause (A) any of the representations or warranties of the Company or the Principal Stockholders in this Agreement to be untrue at, or as of any time prior to, the Effective Time; (B) any of the conditions set forth in Article VI to not be satisfied; (C) a Material Adverse Effect on the Company or (D) any impairment of the ability of the Company, Parent or Merger Sub to consummate the Merger in accordance with the terms hereof or materially delay such consummation;

(x)                                   Taxes. Make or change any election in respect of Taxes, adopt or change any accounting method in respect of Taxes, file any Tax Return or any amendment to a Tax Return, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;

(y)                                 Revaluation. Revalue any of its assets, including writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of business or as required by changes in GAAP, or make any change in its accounting principles, practices or methods, except as required by Applicable Law or GAAP; or

(z)                                   Other. Take or agree in writing or otherwise to take, any of the actions described in subsections (a) through (y) above, or any action that would cause a material breach of its representations or warranties contained in this Agreement or prevent it from materially performing or cause it not to materially perform its covenants hereunder.

Section 5.2                                      No Solicitation of Other Offers. Except as otherwise required by Applicable Law:

(a)                                  From and after the date of this Agreement until the Effective Time, the Company shall not, directly or indirectly through any Representative of any Company Party or otherwise:  (i) solicit, initiate, or encourage any inquiries or proposals that constitute, or could reasonably be expected to lead to, a proposal or offer for a merger, consolidation, share exchange, business combination, sale of all or substantially all of the assets, sale of shares of capital stock or similar transactions involving any Company Party

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other than the Contemplated Transactions (any of the foregoing inquiries or proposals an “Acquisition Proposal”); (ii) engage or participate in negotiations or discussions concerning, or provide any nonpublic information to any Person relating to, any Acquisition Proposal; or (iii) agree to, enter into, accept, approve or recommend any Acquisition Proposal. The Company represents and warrants that it has the legal right to terminate any pending discussions or negotiations relating to an Acquisition Proposal without payment of any fee or other penalty.

(b)                                 The Company shall notify Parent immediately (and no later than twenty-four (24) hours) after receipt by any Company Party (or its Representatives) of any Acquisition Proposal or any request for nonpublic information in connection with an Acquisition Proposal or for access to the properties, books or records of any Company Party by any Person that informs any Company Party that it is considering making, or has made, an Acquisition Proposal. Such notice shall be made orally and in writing and shall indicate in reasonable detail the identity of the offeror and the terms and conditions of such proposal, inquiry or contact.

Section 5.3                                      Access to Information Concerning Properties and Records. During the period commencing on the date hereof and ending on the earlier of (i) the Effective Time or (ii) the date on which this Agreement is terminated, the Company shall, and shall cause each Subsidiary of the Company to, upon reasonable notice, afford Parent and Merger Sub, and their respective counsel, accountants, consultants, financing sources and other authorized representatives, reasonable access to the officers, directors and employees, properties, books and records of the Company and each Subsidiary of the Company and promptly furnish all requested information concerning their business, properties, Contracts, assets, liabilities, and personnel and facilitate access to any of their lessors, lessees, suppliers, customers and business partners as is reasonably requested by Parent; provided, however, that such investigation shall not affect the representations and warranties made by the Company or the Principal Stockholders in this Agreement.

Section 5.4                                      Reasonable Best Efforts. Subject to the terms and conditions provided herein, each of the Company, Parent and Merger Sub shall, and the Company shall cause each of its Subsidiaries to, cooperate and use their reasonable best efforts to take, or cause to be taken, all appropriate action, to adopt, or cause to be adopted, all appropriate resolutions and approvals and to make, or cause to be made, all filings necessary, proper or advisable under Applicable Laws to consummate and make effective the Contemplated Transactions, including their reasonable best efforts to obtain prior to the Closing Date, all Permits, Consents, qualifications and Orders as are necessary for consummation of the Contemplated Transactions for the operation of the business of the Company by the Surviving Corporation as presently conducted by the Company and contemplated to be conducted by the Surviving Corporation and to fulfill the conditions to the Merger.

Section 5.5                                      Sale of Shares Pursuant to Regulation D. The Parties hereto acknowledge and agree that the shares of Parent Common Stock issuable to the Company stockholders pursuant to Section 2.7 hereof shall constitute “restricted securities” within the Securities Act. The certificates of Parent Common Stock shall bear the legends set forth in Section 2.9. The Company will use its best efforts to cause each Eligible Company Holder who will receive

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Parent Common Stock to execute and deliver to Parent an Accredited Investor Certificate in the form attached hereto as Exhibit B. It is acknowledged and understood that Parent is relying on the written representations made by each stockholder of the Company in the Accredited Investor Certificates.

Section 5.6                                      Registration of Parent Common Stock. The Parties acknowledge that the shares of Parent Common Stock, if any, to be issued as part of the Merger Consideration will not be registered with the SEC or any other Governmental Body at the time of issuance and are being issued in reliance on an exemption from registration under the Securities Act and applicable blue sky Laws. Simultaneous with the execution hereof, Parent shall enter into a registration rights agreement (the “Registration Rights Agreement”) in substantially the form attached hereto as Exhibit C. The Registration Rights Agreement shall, among other things, identify each Eligible Company Holder who shall receive shares of Parent Common Stock pursuant to the Merger as an intended third party beneficiary of the provisions of such agreement.

Section 5.7                                      Notification of Certain Matters. The Company and the Principal Stockholders shall promptly after becoming aware thereof advise Parent of (a) any representation or warranty made by the Company or the Principal Stockholders contained in this Agreement becoming untrue or inaccurate in any respect, (b) the failure by the Company or the Principal Stockholders to comply with or satisfy in any material respect any covenant, condition or agreement to be complied with or satisfied by such Parties under this Agreement or (c) any change or event (i) having, or which could, individually or in the aggregate, have a Material Adverse Effect on any Company Party or (ii) which has resulted, or which, insofar as can reasonably be foreseen, would result, in any of the conditions set forth in Article VI not being satisfied; provided, however, that no such notification shall affect the representations, warranties, covenants or agreements of the Company or the other conditions to the obligations of Parent or Merger Sub under this Agreement.

Section 5.8                                      Public Announcements. The Parties shall consult with each other before issuing any press release or otherwise making any public statements with respect to the Contemplated Transactions and shall not issue any such press release or make any such public statement prior to such consultation and review by the other Parties of such release or statement or without the prior consent of the other Parties, which consent shall not be unreasonably withheld, conditioned or delayed; provided, however, that a Party may, without the prior consent of the other Parties, issue such press release or make such public statement if it is advised by counsel such statement is required by Law or any listing agreement with a national securities exchange or automated quotation system which Parent or the Company is a party to, if it has used all reasonable best efforts to consult with the other Parties and to obtain such Parties’ consent but has been unable to do so in a timely manner.

Section 5.9                                      Resignation of Directors and Officers. Prior to the Effective Time, the Company shall cause each member of its Board of Directors and every member of the Board of Directors of each Subsidiary of the Company, to execute and deliver a letter effectuating his or her resignation as a director of the Board of Directors of the applicable Company Party effective immediately prior to the Effective Time. Prior to the Effective Time the Company shall cause each officer of the Company and of each Subsidiary of the Company, to execute and deliver a

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letter effectuating his or her resignation as an officer of the applicable Company Party, as the case may be, effective immediately prior to the Effective Time.

Section 5.10                                Regulatory Approval; Further Assurances.

(a)                                  Each Party shall use all reasonable efforts to file, as promptly as practicable after the date of this Agreement, all notices, reports and other documents required to be filed by such Party with any Governmental Body with respect to the Merger and the other Contemplated Transactions, and to submit promptly any additional information requested by any such Governmental Body.

(b)                                 Subject to Section 5.10(c) Parent and the Company shall use all reasonable efforts to take, or cause to be taken, all actions necessary to effectuate the Merger and make effective the other Contemplated Transactions. Without limiting the generality of the foregoing, but subject to Section 5.10(c) each Party to this Agreement shall:  (i) make any filings and give any notices required to be made and given by such Party in connection with the Merger and the other Contemplated Transactions; (ii) use all reasonable efforts to obtain any Consent required to be obtained (pursuant to any Applicable Law or applicable Contract, or otherwise) by such Party in connection with the Merger or any of the other Contemplated Transactions; and (iii) use all reasonable efforts to lift any restraint, injunction or other legal bar to the Merger. Each Party shall promptly deliver to the other a copy of each such filing made, each such notice given and each such Consent obtained by such Party during the period prior to the Effective Time. Each Party, at the reasonable request of the other Party, shall execute and deliver such other instruments and do and perform such other acts and things as may be necessary or desirable for effecting completely the consummation of this Agreement and the Contemplated Transactions.

(c)                                  Notwithstanding anything to the contrary contained in this Agreement, Parent shall not have any obligation under this Agreement to: (i) dispose or transfer or cause any of its Subsidiaries to dispose of or transfer any assets, or to commit to cause any Company Party or the Surviving Corporation to dispose of any assets; (ii) discontinue or cause any of its Subsidiaries to discontinue offering any product or service, or commit to cause any Company Party or the Surviving Corporation to discontinue offering any product or service; (iii) license or otherwise make available, or cause any of its Subsidiaries to license or otherwise make available, to any Person, any technology, software or other Intellectual Property, or commit to cause any Company Party or the Surviving Corporation to license or otherwise make available to any Person any technology, software or other Intellectual Property; (iv) hold separate or cause any of its Subsidiaries to hold separate any assets or operations (either before or after the Closing Date), or commit to cause any Company Party or the Surviving Corporation to hold separate any assets or operations; or (v) make or cause any of its Subsidiaries to make any commitment (to any Governmental Body or otherwise) regarding its future operations or the future operations of any Company Party or the Surviving Corporation.

Section 5.11                                Blue Sky Laws. Parent shall take such steps as may be necessary to comply with the securities and blue sky Laws of all jurisdictions applicable to the issuance of the

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Parent Common Stock in connection with the Merger. The Company shall use its commercially reasonable efforts to assist Parent to comply with the securities and blue sky Laws of all jurisdictions applicable to the issuance of Parent Common Stock in connection with the Merger.

Section 5.12                                Employees. The Company will use commercially reasonable efforts in consultation with Parent to retain certain employees of the Company Parties through the Effective Time and following the Merger.

Section 5.13                                Expenses. Whether or not the Merger is consummated, all costs and expenses incurred in connection with this Agreement and the Contemplated Transactions shall be paid by the party incurring such expense.

Section 5.14                                Special Indemnity Insurance. The Parent shall apply for and obtain the Special Indemnity Insurance, provided that the Company shall pay all fees and expenses associated therewith, including all premiums and any and all loss mitigation and due diligence fees. For purposes of this Agreement, “Special Indemnity Insurance” shall mean a representations and warranties insurance policy in substantially the form of Exhibit F attached hereto.

ARTICLE VI

CONDITIONS TO THE MERGER

Section 6.1                                      Conditions to Each Party’s Obligations to Effect the Merger. The respective obligations of each Party to consummate the Contemplated Transactions are subject to the satisfaction or waiver (subject to Applicable Law), at or prior to the Effective Time, of each of the following conditions:

(a)                                  Stockholder Approval. This Agreement, the Merger and the other Contemplated Transactions shall be approved by the stockholders of the Company by the requisite vote under Delaware Law and the Company’s Certificate of Incorporation and Bylaws.

(b)                                 No Injunctions or Restraints; Illegality. No temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal or regulatory restraint or prohibition preventing the consummation of the Merger shall be and remain in effect, nor shall any Proceeding brought by an administrative agency or commission or other Governmental Body seeking any of the foregoing be pending, which could reasonably be expected to have a Material Adverse Effect on Parent, either individually or combined with the Surviving Corporation after the Effective Time, nor shall there be any action taken, or any Law or Order enacted, entered, enforced or deemed applicable to the Merger, which makes the consummation of the Merger illegal.

(c)                                  Governmental Approval. Parent, the Company and Merger Sub shall have timely obtained from each Governmental Body all Consents necessary for consummation of or in connection with the Merger and the other Contemplated Transactions, including

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such Consents as may be required under the Securities Act and under state blue sky Laws.

Section 6.2                                      Conditions to Parent’s and Merger Sub’s Obligations to Effect the Merger. The respective obligations of Parent and Merger Sub to consummate the Contemplated Transactions are subject to the satisfaction or waiver (subject to Applicable Law), at or prior to the Effective Time, of each of the following conditions:

(a)                                  Representations and Warranties. The representations and warranties of the Company and the Principal Stockholders in this Agreement shall be true and correct at and as of the Closing Date as though such representations and warranties were made at and as of the Closing Date, except (i) to the extent the failure of such representations and warranties to be true and correct shall not have a Company Material Adverse Effect (disregarding, for this purpose, qualifiers as to materiality contained in any such representations and warranties), and (ii) for those representations and warranties which address matters only as of a particular date (which shall be true and correct as of such date).

(b)                                 Compliance with Obligations. The Company and the Principal Stockholders shall have performed and complied in all material respects with each obligation, agreement or covenant of the Company and the Principal Stockholders to be performed or complied with by them as of the Closing Date under this Agreement.

(c)                                  Certificate of Officers. Parent and Merger Sub shall have received a certificate executed on behalf of the Company by the Chief Executive Officer and Chief Financial Officer of the Company, dated as of the Closing Date, certifying the conditions set forth in Sections 6.2(a) and 6.2(b) have been satisfied.

(d)                                 Secretary’s Certificate. Parent and Merger Sub shall have received a certificate executed on behalf of the Company by the Secretary of the Company, dated as of the Closing Date certifying that the attached copies of the resolutions or actions of the Company’s board of directors and the stockholders approving the execution and delivery of this Agreement and the performance of the Company’s and the Principal Stockholders’ obligations hereunder and the consummation of the Contemplated Transactions are true, correct and complete, were duly adopted and are in full force and effect.

(e)                                  Good Standing. Parent and Merger Sub shall have received (i) a certificate as to the good standing of the Company issued by the Secretary of State for the State of Delaware, dated within thirty (30) days of the Closing, (ii) a good standing certificate as to the good standing of each Subsidiary of the Company issued by the applicable Government Body of the jurisdiction of organization of each Subsidiary, dated within thirty (30) days of the Closing, (iii) a certificate from the Massachusetts Secretary of State as to the due qualification of the Company and, if applicable, each other Company Party, to do business in Massachusetts, dated within thirty (30) days of the Closing, (iv) a certificate from the Massachusetts Department of Revenue as to the tax good standing of the Company and, if applicable, each other Company Party, in the Commonwealth of Massachusetts, dated within thirty (30) days of the Closing, (v) 

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certificates as to the good standing and qualification to do business as a foreign entity for each Company Party in each other jurisdiction where such Company Party is qualified to do business as a foreign entity, dated within thirty (30) days of the Closing, and (vi) certificates of no Tax due in each jurisdiction where any Company Party is qualified to do business.

(f)                                    Third Party Consents. All Consents required to be obtained in connection with the Merger and the other Contemplated Transactions shall have been obtained and shall be in full force and effect.

(g)                                 No Governmental Litigation. There shall not be pending or threatened any Proceeding in which a Governmental Body is or is threatened to become a party or is otherwise involved, and neither Parent nor any Company Party shall have received any communication from any Governmental Body in which such Governmental Body indicates the probability of commencing any Proceeding or taking any other action:  (i) challenging or seeking to restrain or prohibit the consummation of the Merger; (ii) relating to the Merger and seeking to obtain from Parent or any of its Subsidiaries, or any Company Party, any damages or other relief that would be material to Parent; (iii) seeking to prohibit or limit in any material respect Parent’s ability to vote, receive dividends with respect to or otherwise exercise ownership rights with respect to the stock (or other ownership interest) of the Company Parties; or (iv) that would materially and adversely affect the right of Parent, Merger Sub, the Surviving Corporation or any Company Party to own the assets or operate the business of the Company Parties.

(h)                                 Opinion of the Company’s Counsel. Parent and Merger Sub shall have received a written opinion from the Company’s legal counsel in form and substance reasonably satisfactory to Parent.

(i)                                     No Other Litigation. There shall not be pending any other Proceeding:  (i) challenging or seeking to restrain or prohibit the consummation of the Merger or any of the other Contemplated Transactions; (ii) relating to the Merger and seeking to obtain from Parent or any of its Subsidiaries, or any Company Party, any damages or other relief that would be material to Parent; (iii) seeking to prohibit or limit in any material respect Parent’s ability to vote, receive dividends with respect to or otherwise exercise ownership rights with respect to any capital stock (or other ownership interest) of any Company Party; or (iv) which would affect adversely the right of Parent, Merger Sub, the Surviving Corporation or any Company Party to own the assets or operate the business of any Company Party.

(j)                                     Employees. As of the Closing, there shall be sufficient employees of the applicable Company Parties, in Parent’s reasonable good faith determination, to permit Parent to continue to operate the business of the Company Parties in the ordinary course of business following the Closing.

(k)                                  Escrow Agreement. Parent, Merger Sub, the Company, Escrow Agent and the Stockholder Representative shall have entered into an Escrow Agreement substantially in the form attached hereto as Exhibit A.

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(l)                                     Voting Agreement. The Principal Stockholders shall have entered into and performed their respective obligations under the Voting Agreement.

(m)                               No Material Adverse Change. There shall not have occurred any change in the financial condition, properties, assets (including intangible assets), liabilities, business, operations, results of operations or prospects of the Company Parties, taken as a whole, that, individually or in the aggregate, could reasonably be expected to have a Company Material Adverse Effect.

(n)                                 Accredited Investor Certificate; Number of Shareholders. Each of the Company’s stockholders that will receive Parent Common Stock shall have delivered to Parent a signed Accredited Investor Certificate in substantially the form attached hereto as Exhibit B and each such Accredited Investor Certificate shall be in full force and effect.

(o)                                 Employment Agreements. Each of the key employees of the Company Parties shall have executed and delivered the Employment Agreements, which shall include non-competition provisions, in form and substance mutually acceptable to Parent and the applicable employees.

(p)                                 Transmittal Letter. Each Eligible Company Holder other than Eligible Company Holders whose shares constitute Dissenting Shares shall have completed and delivered to Parent a signed transmittal letter in substantially the form attached hereto as Exhibit E.

(q)                                 Dissenters’ Rights. Not more than five percent (5%) of the capital stock of the Company outstanding immediately prior to the Effective Time shall be Dissenting Shares.

(r)                                    Accredited Investors. At least sixty-five percent (65%) of the capital stock of the Company outstanding immediately prior to the Effective Time (assuming the exercise of all In-the-Money Options), shall be owned by “accredited investors” (as defined in the Securities Act of 1933).

(s)                                  Special Indemnity Insurance. The Special Indemnity Insurance policy shall have been issued and delivered to the Parent.

(t)                                    Transfer and Registration of Subsidiary Stock. All actions required under Applicable Law to effect the transfer of all of the outstanding shares of capital stock of the Subsidiaries to, or the registration of all of the outstanding shares of capital stock of the Subsidiaries in the name of, the Parent or its designee shall have been fully performed in accordance with Applicable Law.

(u)                                 Repayment of Certain Loans. Parent shall have received evidence reasonably satisfactory to it that all loans from the Company to the employees of the Company and to the Principal Stockholders outstanding immediately prior to the Closing shall have been repaid in full.

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Section 6.3                                      Additional Conditions to Obligations of the Company. The obligations of the Company to consummate the Contemplated Transactions shall be subject to the satisfaction at or prior to the Closing Date of each of the following conditions:

(a)                                  Representations and Warranties. The representations and warranties of Parent and Merger Sub in this Agreement shall be true and correct at and as of the Closing Date as though such representations and warranties were made at and as of the Closing Date, except (i) to the extent the failure of such representations and warranties to be true and correct shall not have a Parent Material Adverse Effect (disregarding, for this purpose, qualifiers as to materiality contained in any such representations and warranties), and (ii) for those representations and warranties which address matters only as of a particular date (which shall be true and correct as of such date).

(b)                                 Compliance with Obligations. Parent and Merger Sub shall have performed and complied in all material respects with each obligation, agreement or covenant of Parent and Merger Sub to be performed or complied with by them as of the Closing Date under this Agreement.

(c)                                  Certificate of Officers. The Company shall have received a certificate executed on behalf of Parent by the Chief Executive Officer and Chief Financial Officer of Parent, dated as of the Closing Date, certifying the conditions set forth in Sections  6.3(a) and 6.3(b) have been satisfied.

(d)                                 Escrow Consideration. The Escrow Consideration shall have been deposited with the Escrow Agent as contemplated hereby and by the Escrow Agreement.

(e)                                  Secretary’s Certificate. The Company shall have received a certificate executed on behalf of Parent and Merger Sub by the Secretary of each of Parent and Merger Sub, dated as of the Closing Date certifying that the attached copies of the resolutions or actions of the board of directors and the stockholders of each of Parent and Merger Sub approving the execution and delivery of this Agreement and the performance of the obligations of Parent and Merger Sub hereunder and the consummation of the Contemplated Transactions are true, correct and complete, were duly adopted and are in full force and effect.

(f)                                    Good Standing. The Company shall have received a good standing certificate of each of Parent and Merger Sub issued by the Secretary of State for the State of Delaware, dated within thirty (30) days of the Closing.

(g)                                 Registration Rights Agreement. Parent shall have executed the Registration Rights Agreement (which agreement shall identify each Eligible Company Holder who receives shares of Parent Common Stock pursuant to the Merger as an intended third party beneficiary of the provisions of such agreement), and such agreement shall be in full force and effect.

(h)                                 Opinion of  Counsel for Parent and Merger Sub. The Company and the Eligible Company Holders shall have received a written opinion from legal counsel for

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the Parent and the Merger Sub in form and substance reasonably satisfactory to the Company.

ARTICLE VII

TERMINATION; FEES AND EXPENSES

Section 7.1                                      Termination. This Agreement may be terminated and the Contemplated Transactions may be abandoned, at any time prior to the Effective Time, whether before or after approval of the Merger by the stockholders of the Company:

(a)                                  by mutual written consent of the Company, Parent, Merger Sub and the Principal Stockholders;

(b)                                 by either Parent or the Company if the Merger shall not have been consummated by September 30, 2007; provided, however, that the right to terminate this Agreement under Section 7.1(b) shall not be available to any Party whose failure to fulfill any obligation under this Agreement has been the cause of or resulted in the failure of the Merger to occur on or before such date;

(c)                                  by either Parent or the Company if any Law shall have been promulgated which prohibits the consummation of the Merger or if any Governmental Body shall have issued an Order or taken any other action permanently restricting, enjoining, restraining or otherwise prohibiting the consummation of the Merger and such Order or other action shall have become final and nonappealable; provided, that the Party seeking to terminate pursuant to this Section 7.1(b) shall have complied with its obligations under Section 5.4 to use its reasonable best efforts to have any such Order or other action vacated or lifted;

(d)                                 by either Parent or the Company if this Agreement and the Merger are not approved by the requisite vote of the holders of Company Common Stock entitled to vote thereon in accordance with Applicable Law, the Company’s Certificate of Incorporation and the Company’s Bylaws, if required by Applicable Law;

(e)                                  by Parent (i) if a Triggering Event shall have occurred, or (ii) if the Average Closing Price shall be less than $.80; or (iii) if the Company or its Representatives participate in discussions or negotiations with, or furnish or disclose nonpublic information to, any Person in response to an Acquisition Proposal; or (iv) if the Company or the Principal Stockholders shall have breached in any material respect any of their respective representations, warranties, covenants or other agreements contained in this Agreement, which breach cannot be or has not been cured within fifteen (15) days after giving of written notice by Parent to the Company and the Principal Stockholders; or (v) if there shall have occurred a Company Material Adverse Effect; and

(f)                                    by the Company if (i) Parent or Merger Sub shall have breached in any material respect any of their respective representations, warranties, covenants or other agreements contained in this Agreement, which breach cannot be or has not been cured within fifteen (15) days after giving of written notice by the Company to Parent or

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Merger Sub, as applicable; (ii) if the Average Closing Price shall be less than $.80; or (iii) if there shall have occurred a Material Adverse Effect with respect to Parent.

Section 7.2                                      Effect of Termination. In the event of the termination of this Agreement pursuant to Section 7.1 hereof by Parent or the Company, written notice thereof shall forthwith be given to the other Parties hereto specifying the provision hereof pursuant to which such termination is made, unless such termination is made pursuant to Section 7.1(a) in which case no such notice shall be necessary, and this Agreement shall become void and have no effect, and there shall be no liability hereunder on the part of the Parties, except (a) that Article IX to the extent applicable and this Section 7.2 shall survive any termination of this Agreement and (b) nothing in this Section 7.2 shall relieve any Party to this Agreement of liability for breach of this Agreement.

ARTICLE VIII

ESCROW AND INDEMNIFICATION

Section 8.1                                      Survival. Other than the representations and warranties contained in Sections 3.1, 3.2, 3.5, 3.6, 3.20, 3.21, 3.22, 3.23, 3.32, 4.1 and 4.2, which shall survive perpetually, and the representations and warranties contained in Section 3.11, which shall survive for a period of thirty (30) months from the Closing Date, all representations and warranties of the Parties contained in this Agreement and the other agreements, documents, certificates, schedules or exhibits contemplated hereby or delivered in connection herewith (collectively, the “Related Documents”) shall survive the Effective Time and remain operative and in full force and effect, regardless of any investigation or disclosure made by or on behalf of any other Party, through the Final Escrow Release Date; provided, however, that if notice of any claim for indemnification is given pursuant to Sections 8.2 or 8.3 prior to such time, the related representations and warranties, together with such indemnification claim, shall survive until such time as such claim is finally resolved. All covenants of the Parties shall survive according to their respective terms.

Section 8.2                                      Indemnification by the Company and the Eligible Company Holders.

(a)                                  Subject to the provisions of this Article VIII, the Company and each of the Eligible Company Holders shall jointly and severally indemnify, defend and hold harmless Parent and the Surviving Corporation and their respective Representatives, stockholders and each Person, if any, who controls or may control Parent or the Surviving Corporation within the meaning of the Securities Act or the Exchange Act (collectively the “Parent Indemnified Parties”), from and against any and all claims, demands, suits, actions, causes of action, losses, reductions in value, costs, damages (including consequential damages), liabilities and expenses, including reasonable attorneys’ fees, other professionals’ and experts’ fees and court or arbitration costs, amounts paid in settlement and sanctions (hereinafter collectively referred to as “Damages”) (whether or not such Damages are fully identified, quantified, and/or incurred or suffered prior to the issuance and delivery of the Parent Claim Notice with respect thereto) arising out of or related to:

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(i)                                     Any misrepresentation or breach of or default or inaccuracy in any of the representations or warranties of the Company and the Eligible Company Holders contained in this Agreement and/or any of the Related Documents;

(ii)                                  Any breach or failure by the Company or by the Eligible Company Holders to comply with any of their respective covenants contained in this Agreement and/or any of the Related Documents; and/or

(iii)                               any third party claim, or threatened third party claim, asserted against any Parent Indemnified Party arising out of the actions or inactions of the Company or any Eligible Company Holders prior to the Effective Time.

(b)                                 Any claim for indemnification made by any Parent Indemnified Party under this Section 8.2 must be made in writing delivered to the Stockholder Representative no later than the Final Escrow Release Date (a “Parent Claim Notice”). If delivered to the Stockholder Representative no later than the Final Escrow Release Date, a claim for indemnification set forth in a Parent Claim Notice as provided herein shall survive the Final Escrow Release Date until final resolution thereof as provided in this Article VIII.

(c)                                  Notwithstanding the foregoing provisions of this Article VIII (or any other provision of this Agreement), the Parties agree that:

(i)                                     in no event may any Parent Indemnified Party make a claim for indemnification under Section 8.2(a)(i) unless the amount of the Damages incurred by the Parent Indemnified Parties with respect to such claim exceeds $500;

(ii)                                  the indemnification provided for in Section 8.2(a)(i) shall not apply unless and until the aggregate Damages for which the Parent Indemnified Parties seek or have sought indemnification hereunder, as stated in one or more Parent Claim Notices, exceed a cumulative aggregate of $125,000 (the “Basket”) (except for any such Parent Claim Notices pertaining to Damages allegedly suffered or incurred based upon a misrepresentation or breach of or default or inaccuracy in or in connection with the representations or warranties in Sections 3.8 and/or 3.11, which shall be subject to the Special Basket), in which case the right to recover Damages shall apply to the full amount of the claim; provided, however, that (A) the Basket shall not apply to any such indemnification claim (x) involving fraud, gross negligence or willful misconduct on the part of the Company or the Eligible Company Holders, or (y) based upon a misrepresentation or breach of or default or inaccuracy in or in connection with the representations or warranties in Sections 3.1, 3.2, 3.5, 3.6,  3.9, 3.20, 3.21, 3.22, 3.23 and 3.32, and (B) the Special Basket shall not apply to any such indemnification claim involving fraud, gross negligence or willful misconduct on the part of the Company or the Eligible Company Holders; and

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(iii)                               nothing in this Agreement shall (w) limit the right of any Parent Indemnified Party to seek specific performance of, or equitable relief with respect to, the Company or the Eligible Company Holders with respect to a breach by the Company or by the Eligible Company Holders of any covenant or agreement set forth in this Agreement, (x) be deemed a waiver by any Parent Indemnified Party of any right or remedy which such Party may have at law or in equity based on any claim of fraud, (y) limit the liability in amount or otherwise of the Company or the Principal Stockholders for any breach of any representation, warranty or covenant if the Merger does not close; or (z) limit the liability in amount or otherwise of the Company or the Eligible Company Holders with respect to their respective fraud, criminal activity, gross negligence or willful misconduct.

Section 8.3                                      Indemnification by Parent.

(a)                                  Subject to the provisions of this Article VIII, Parent shall indemnify, defend and hold harmless the Eligible Company Holders and their respective Representatives, equity owners and each Person, if any, who controls or may control such Eligible Company Holders within the meaning of the Securities Act or the Exchange Act (collectively the “Eligible Holder Indemnified Parties”), from and against any and all Damages arising out of or related to:

(i)                                     Any misrepresentation or breach of or default or inaccuracy in any of the representations or warranties of Parent contained in Article IV; or

(ii)                                  Any breach or failure to comply with any of the covenants of Parent set forth in this Agreement; and/or

(iii)                               any third party claim, or threatened third party claim, asserted against any Eligible Holder Indemnified Party arising out of Parent’s or Merger Sub’s actions or inactions prior to the Effective Time.

(b)                                 Any claim for indemnification made by any Eligible Holder Indemnified Party under this Section 8.3 must be made in writing delivered to Parent no later than the Final Escrow Release Date (an “Eligible Holder Claim Notice”). If delivered to Parent no later than the Final Escrow Release Date, a claim for indemnification set forth in an Eligible Holder Claim Notice as provided herein shall survive the Final Escrow Release Date until final resolution thereof as provided in this Article VIII.

(c)                                  Notwithstanding the foregoing provisions of this Article VIII (or any other provision of this Agreement), the Parties agree that:

(i)                                     the indemnification provided for in Section 8.3(a)(i) shall not apply unless and until the aggregate Damages for which the Eligible Holder Indemnified Parties seek or have sought indemnification hereunder, as stated in one or more Eligible Holder Claim Notices, exceed the Basket, in which case the right to recover Damages shall apply to the full amount of the claim; provided, however, that the Basket shall not apply to any such indemnification claim

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(x) involving fraud, gross negligence or willful misconduct on the part of Parent or Merger Sub or (y) based upon a misrepresentation or breach of or default or inaccuracy in or in connection with the representations or warranties in Sections 4.1 or 4.2; and

(ii)                                  nothing in this Agreement shall (w) limit the right of any Eligible Holder Indemnified Party to seek specific performance of, or equitable relief with respect to, Parent with respect to a breach of any covenant or agreement set forth in this Agreement, (x) be deemed a waiver by any Eligible Holder Indemnified Party of any right or remedy which such Party may have at law or in equity based on any claim of fraud, (y) limit the liability in amount or otherwise of Parent or Merger Sub for any breach of any representation, warranty or covenant if the Merger does not close; or (z) limit the liability in amount or otherwise of Parent or Merger Sub with respect to their respective fraud, criminal activity, gross negligence or willful misconduct.

Section 8.4                                      Effect on Merger Consideration; Stockholder Representatives.

(a)                                  The entitlement of any Eligible Company Holder to receive such Eligible Company Holder’s pro rata share of the amount of the Merger Consideration represented as of any given time by the Escrow Fund is expressly subject to the applicable provisions of this Article VIII (including the ability of the Parent Indemnified Parties to seek recourse against the Escrow Fund for Damages as provided in Section 8.5).

(b)                                 By virtue of their approval of this Agreement and the Merger, each Eligible Company Holder (other than any holder of Dissenting Shares) shall be deemed to have approved, effective as of such vote and without any further action by the Eligible Company Holders, the appointment of ▇▇▇▇▇ ▇▇▇▇ as the Stockholder Representative (the “Stockholder Representative”); provided, however, that a successor to any Stockholder Representative may be chosen by Eligible Company Holders holding more than fifty percent (50%) of the then-present percentage interests in the Escrow Fund (assuming, for this purpose, a distribution of the entire amount of the Escrow Fund on the date of determination).

(c)                                  The Stockholder Representative shall be deemed to be appointed and constituted agent and attorney-in-fact by each Eligible Company Holder, for and on behalf of such Eligible Company Holder, to do the following:  (i) to give and receive notices and communications; (ii) to authorize recovery by any Parent Indemnified Party against the Escrow Fund in satisfaction of claims as contemplated by this Article VIII; (iii) to object to such recovery; (iv) to agree to, negotiate and enter into settlements and compromises of, and comply with court judgments and awards of arbitrators with respect to, claims against the Escrow Fund; (v) to waive or settle any and all rights of Eligible Company Holders with respect to the delivery of any portion of the Escrow Fund; (vi) to participate in the resolution of any disputed claim; (vii) to resolve, with full authority to settle in any manner, any such disputed claim; (viii) to resolve, with full authority, any matters relating to the Stipulated Closing Net Working Capital Calculation; (ix) to take all actions necessary or appropriate in the judgment of the Stockholder Representative for

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the accomplishment of any of the foregoing; and (x) to receive any portion of the Escrow Fund otherwise to be distributed to the Eligible Company Holders and to use an appropriate portion thereof for purposes of paying the costs associated with any of the foregoing.

(d)                                 The Stockholder Representative may resign upon thirty (30) days’ notice to Parent and each Eligible Company Holder. The Stockholder Representative may be replaced by the Eligible Company Holders from time to time upon not less than five (5) Business Days’ prior written notice to Parent; provided, however, that the Stockholder Representative may not be replaced unless Eligible Company Holders holding more than fifty percent (50%) of the then-present percentage interests in the Escrow Fund (assuming, for this purpose, a distribution of the entire amount of the Escrow Fund on the date of determination) agree to such replacement. No bond shall be required of the Stockholder Representative, and the Stockholder Representative shall receive no compensation for his services.

(e)                                  The Stockholder Representative shall: (i) not be liable to Parent, the Surviving Corporation or any Eligible Company Holders for any act done or omitted as a Stockholder Representative unless acting in bad faith; (ii) be entitled to treat as genuine any letter or other document furnished by Parent, the Surviving Corporation, any Eligible Company Holder or the Escrow Agent and believed to be genuine and to have been signed and presented by the proper party or parties; and (iii) be reimbursed from any portion of the Escrow Fund otherwise to be distributed to the Eligible Company Holders for any loss, liability or expense incurred without bad faith on the part of the Stockholder Representative and arising out of or in connection with the acceptance or administration of the Stockholder Representative’s duties hereunder (including counsel fees and other out-of-pocket expenses), such reimbursement to be made directly from the Escrow Fund by the Escrow Agent, who shall be entitled to rely upon the instruction of the Stockholder Representative in this regard. To the extent that there is not a sufficient amount of the Escrow Fund otherwise to be distributed to any Eligible Company Holders available, the Eligible Company Holders shall severally, and not jointly, in proportion to each Eligible Company Holder’s pro rata entitlement to a share of the Escrow Fund, indemnify the Stockholder Representative and hold the Stockholder Representative harmless against any loss, liability or expense incurred without bad faith on the part of the Stockholder Representative and arising out of or in connection with the acceptance or administration of the Stockholder Representative’s duties hereunder.

(f)                                    Parent and Merger Sub shall have no liability to any Eligible Company Holder or otherwise arising out of the acts or omissions of the Stockholder Representative or any disputes among the Eligible Company Holders or with the Stockholder Representative.

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Section 8.5                                      Handling Claims. Subject to the limitations set forth in Article VIII:

(a)                                  With respect to any Parent Claim Notice:

(i)                                     The Stockholder Representative may notify the Parent Indemnified Party in writing prior to the expiration of a period of thirty (30) days following the delivery of such Parent Claim Notice to the Stockholder Representative that some or all of the subject claim(s) of the Parent Indemnified Party are disputed. In the absence of any such notice within such thirty (30) day period, or upon an earlier notice from the Stockholder Representative to the Parent Indemnified Party  and the Escrow Agent confirming that the subject claim(s) of the Parent Indemnified Party are not disputed, then promptly following such thirtieth (30^th) day or such earlier confirming notice, the Damages in the amount specified in such Parent Claim Notice will be (x) conclusively deemed a claim against the then-current amount in the Escrow Fund after adjusting for any deductions or distributions which should have been made therefrom as provided herein and (y) paid by the Escrow Agent to the Parent Indemnified Party from such current amount in the Escrow Fund after adjusting for any deductions or distributions which should have been made therefrom as provided herein (to the extent such funds are available).

(ii)                                  If the Stockholder Representative notifies the Parent Indemnified Party in writing prior to the expiration of the thirty (30) day period following the delivery of such Parent Claim Notice to the Stockholder Representative that some or all of the subject claim(s) of the Parent Indemnified Party are disputed, then (except in those instances where the Parent Indemnified Party has also submitted a claim under the Special Indemnity Insurance) the Stockholder Representative and the Parent Indemnified Party  shall attempt in good faith to agree upon the rights of the Parent Indemnified Party with respect to each of such claims within thirty (30) days after such objection. If the Stockholder Representative and the Parent Indemnified Party should so agree on a claim, then a memorandum setting forth such agreement shall be prepared and delivered to the Escrow Agent, with a statement of the portion of the then-current amount in the Escrow Fund (after adjusting for any deductions or distributions which should have been made therefrom as provided herein), if any, to be distributed to the Parent Indemnified Party (and, if applicable, such amount shall be promptly paid by the Escrow Agent to the Parent Indemnified Party to the extent such funds are available). If the Stockholder Representative and the Parent Indemnified Party are unable to resolve any such claim, then, unless the parties mutually agree to a different course of action for resolving the matter, either the Parent Indemnified Party or the Stockholder Representative may file suit to resolve the matter unless the amount of the Damages is at issue in pending litigation with a third party, in which event no suit shall be commenced until such amount is ascertained or the Stockholder Representative and the Parent Indemnified Party consent to the filing of such suit. To the extent that the Parent Indemnified Party has also submitted a claim under the Special Indemnity Insurance, the Stockholder Representative shall be under no obligation to make any attempt to agree upon the rights of the

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Parent Indemnified Party until 30 days after the Parent Indemnified Party shall have exhausted its remedies against the Special Indemnity Insurance, during the pendency of which, a Parent Claim Notice otherwise properly submitted to the Escrow Agent shall be deemed to be a Pending Claim.

(b)                                 With respect to the claim of any third party as to which a Parent Claim Notice may be tendered, Parent shall have the right to conduct and control the defense, settlement, adjustment or compromise of any such claim; provided, however, that Parent shall (i) diligently pursue such defense, (ii) provide notice to, and an opportunity for participation in and comment from, the Stockholder Representative with respect to such defense, and (iii) not effect the settlement, adjustment or compromise of any such claim without the written consent of the Stockholder Representative (which consent shall not be unreasonably withheld or delayed).

(c)                                  With respect to any Eligible Holder Claim Notice:

(i)                                     If Parent shall fail to notify the tendering Eligible Company Holder(s) in writing prior to the expiration of a period of thirty (30) days following delivery to Parent of an Eligible Holder Claim Notice that some or all of the subject claim(s) of the tendering Eligible Company Holder(s) are disputed, or upon an earlier notice from Parent to the tendering Eligible Company Holder(s) confirming that the subject claim(s) of the tendering Eligible Company Holder(s) are not disputed, then promptly following such thirtieth (30^th) day or such earlier confirming notice, the Damages in the amount specified in such Eligible Holder Claim Notice will be (i) conclusively deemed a liability of Parent and (ii) promptly paid by Parent to the tendering Eligible Company Holder(s).

(ii)                                  If Parent shall notify the tendering Eligible Company Holder(s) in writing prior to the expiration of such period of thirty (30) days following delivery of the subject Eligible Holder Claim Notice to Parent that some or all of the subject claim(s) of the tendering Eligible Company Holder(s) are disputed, then Parent and the tendering Eligible Company Holder(s) shall attempt in good faith to agree upon the rights of the respective parties with respect to each of such claims within thirty (30) days after objection by Parent. To the extent that the parties are able to so agree, then any claims which are the subject of such an agreement shall be handled as agreed. To the extent that the parties are not able to so agree, then either Parent or the tendering Eligible Company Holder(s) may file suit to resolve the matter unless the amount of the Damages is at issue in pending litigation with a third party, in which event no suit shall be commenced until such amount is ascertained or Parent and the tendering Eligible Company Holder(s) consent to the filing of such suit.

Section 8.6                                      Limits on Indemnification.

(a)                                  Notwithstanding any provision of this Agreement to the contrary, except as otherwise expressly provided in this Section 8.6, the Eligible Company Holders shall have no liability to the Parent Indemnified Parties under the provisions of this Article

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VIII except with respect to, and to the extent of, their interests in the Escrow Fund. The limitation of liability set forth in the preceding sentence shall not apply to the liability of the Principal Stockholders for indemnification under Section 8.2 for Damages resulting from (i) fraud, gross negligence or willful misconduct by one or more of the Principal Stockholders, or of any Eligible Company Holders as to which fraud, gross negligence or willful misconduct the Principal Stockholders had Knowledge prior to the date of this Agreement, as to which there shall be no limit on indemnification, or (ii) a misrepresentation or breach of or default or inaccuracy in the representations or warranties in Sections 3.1, 3.2, 3.5, 3.6,  3.9, 3.20, 3.21, 3.22 and 3.23, as to which the aggregate liability of the Principal Stockholders shall be limited to that amount which is equal to the cash portion of the final Merger Consideration.

(b)                                 With respect to any and all Damages as may be suffered or incurred by a Parent Indemnified Party at any time arising out of or related to any misrepresentation or breach of or default or inaccuracy in any of the representations or warranties of the Company or the Principal Stockholders contained in Section 3.8 or Section 3.11 of this Agreement, such Parent Indemnified Party shall submit a claim for recovery under the Special Indemnity Insurance (a “Special Insurance Claim”) and use commercially reasonable efforts to recover fully for such Damages from the insurer under the Special Indemnity Insurance in accordance with the terms thereof.. Such Parent Indemnified Party shall also submit a Parent Claim Notice with respect to such Damages. To the extent, having made such efforts, such Damages shall not be recovered fully from the insurer, and in the event that the Damages subject to such Special Insurance Claim and the Parent Claim Notice exceed the sum of $225,000 (the “Special Basket”), then all such unrecovered amounts shall be recoverable against the Escrow Fund, to the extent thereof, subject to and in accordance with this Article VIII.

Section 8.7                                      Release and Waiver. Each Eligible Company Holder hereby waives any and all right that it might otherwise have to make any claim against the Company or the Surviving Corporation or any Affiliate of either for contribution or otherwise if such Eligible Company Holder suffers an indemnity claim under this Agreement. In addition, each Eligible Company Holder hereby releases and forever discharges the Company, each Affiliate of the Company and the Surviving Corporation, contingent upon the Closing, from any and all claims arising out of or otherwise relating to pre-Closing actions, omissions, facts, events or circumstances. For the avoidance of doubt, as used in this Section 8.7, references to Affiliates of the Surviving Corporation shall be deemed not to include Parent or any Person that was an Affiliate of Parent immediately prior to the Effective Time.

Section 8.8                                      Treatment of Indemnification Payments. Any indemnification payments made pursuant to this Article VIII shall be treated as an adjustment to the Merger Consideration for Tax purposes.

Section 8.9                                      Insurance Set-Off. The Eligible Company Holders shall be entitled to a credit against any amount otherwise due under this Article VIII to the extent of any amounts actually recovered by the Parent Indemnified Parties under any insurance policy maintained by or on behalf of  Parent or the Company or any other contractual indemnification benefiting the Parent or the Company that directly relate to the Damages suffered by the Parent Indemnified

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Parties, less the costs associated with obtaining such insurance recovery or contractual indemnification, including but not limited to reasonable attorneys’ fees. Parent shall cause the Company to continue to maintain general liability and product liability insurance coverage on a basis and with limits consistent with the past practices of the Company, for so long as the Eligible Company Holders’ indemnity obligation remains in effect.

Section 8.10                                Exclusive Remedies. The indemnification provisions of this Article VIII shall be the exclusive remedy available to the Parties following the Closing for any claims that are within the subject matter of the indemnities set out in Sections 8.2, and 8.3. Each of the Parties agrees not to, and to cause its Affiliates not to, bring any action or proceeding, at law, equity or otherwise, against any other Party or its Affiliates seeking redress for any such claim except pursuant to the express provisions of this Article VIII. The foregoing shall not apply in the case of fraud, gross negligence or intentional misconduct.

ARTICLE IX

MISCELLANEOUS

Section 9.1                                      Representations and Warranties. The respective representations and warranties of the Company and the Principal Stockholders, on the one hand, and Parent and Merger Sub, on the other hand, contained herein or in any certificates or other documents delivered prior to or at the Closing shall not be deemed waived or otherwise affected by any investigation made by or on behalf of any Party.

Section 9.2                                      Extension; Waiver. At any time prior to the Effective Time, the Parties hereto, may (a) extend the time for the performance of any of the obligations or other acts of the other Parties hereto, (b) waive any inaccuracies in the representations and warranties contained herein by any other applicable Party or in any document, certificate or writing delivered pursuant hereto by any other applicable Party or (c) waive compliance with any of the agreements or conditions contained herein. Any agreement on the part of any Party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such Party.

Section 9.3                                      Notices. Any notice, request, instruction or other document to be given hereunder by any Party to another Party shall be in writing and shall be deemed given when delivered personally, upon receipt of a transmission confirmation (with a confirming copy sent by overnight courier) if sent by facsimile or like transmission, and on the next business day when sent by Federal Express, United Parcel Service, Express Mail, or other reputable overnight courier, to the Party at the following addresses (or such other addresses for a Party as shall be specified by like notice):

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(a)                                  if to the Company (prior to Closing) or the Principal Stockholders, to them at:

iSarla, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:  ▇▇▇▇▇ ▇▇▇▇, CEO
Facsimile:  508-336-5894

with a copy (which shall not constitute notice) to:

▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ & Fish, LLP
World Trade Center West
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention:  ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile:  ▇▇▇-▇▇▇-▇▇▇▇

(b)                                 if to either Company (after Closing), Parent or Merger Sub, to them at:

Forgent Networks, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇. 78746
Attention:  ▇▇▇ ▇▇▇▇▇▇▇▇, CFO and Vice President - Finance

with a copy (which shall not constitute notice) to:

▇▇▇▇▇▇▇▇ PC
5400 Renaissance Tower
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇  ▇▇▇▇▇
Attention:  ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile:  (▇▇▇) ▇▇▇-▇▇▇▇

Section 9.4                                      Entire Agreement. This Agreement, the Schedules, Exhibits and other documents referred to herein or delivered pursuant hereto, collectively contain the entire understanding of the Parties hereto and thereto with respect to the subject matter contained herein and therein and supersede all prior agreements and understandings, oral and written, with respect thereto.

Section 9.5                                      Binding Effect; Benefit; Assignment.

(a)                                  This Agreement shall inure to the benefit of and be binding upon the Parties hereto and nothing in this Agreement, expressed or implied, is intended to confer on any Person other than the Parties hereto or their respective successors and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

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(b)                                 Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the Parties hereto without the prior written consent of the other Parties.

Section 9.6                                      Amendment and Modification. Subject to Applicable Law, this Agreement may be amended, modified and supplemented in writing by the Parties hereto in any and all respects before the Effective Time (notwithstanding any stockholder approval), by action taken by the respective boards of directors of Parent, Merger Sub and the Company and the Principal Stockholders or by the respective officers authorized by such Boards of Directors and the Principal Stockholders; provided, however, that after any such stockholder approval, no amendment shall be made which by Law requires further approval by such stockholders without such further approval.

Section 9.7                                      Headings; Construction. The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only, do not constitute a part of this Agreement and shall not affect in any way the meaning or interpretation of this Agreement. The Parties hereto agree that they have been represented by counsel during the negotiation, preparation and execution of this Agreement and, therefore, waive the application of any Law, holding or rule of construction providing that ambiguities in an agreement or other document will be construed against the Party drafting such agreement or document.

Section 9.8                                      Fees and Expenses. Except for damages of one Party to this Agreement resulting from a breach of the terms of this Agreement by another Party hereto, all costs and expenses incurred in connection with this Agreement and the consummation of the Contemplated Transactions shall be paid by the party incurring such costs and expenses.

Section 9.9                                      Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, and all of which together shall be deemed to be one and the same instrument.

Section 9.10                                Applicable Law. This Agreement and the legal relations between the Parties hereto shall be governed by and construed in accordance with the Laws of the State of Delaware, without regard to principles of conflicts of law that would require application of any other Law.

Section 9.11                                Severability. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction. If the final judgment of a court of competent jurisdiction declares that any term or provision hereof is invalid or unenforceable, the Parties agree that the court making the determination of invalidity or unenforceability shall have the power to reduce the scope, duration or area of the term or provision, to delete specific words or phrases or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, and this Agreement shall be enforceable as so modified after the expiration of the time within which the judgment may be appealed.

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Section 9.12                                Remedies Cumulative. Except as otherwise expressly provided herein (e.g., Section 8.10), any and all remedies herein expressly conferred upon a Party will be deemed cumulative with and not exclusive of any other remedy conferred hereby, or by law or equity upon such Party, and the exercise by a Party of any one remedy will not preclude the exercise of any other remedy.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, each of Parent, Merger Sub and the Company have caused this Agreement to be executed by their respective officers thereunto duly authorized, all as of the date first above written.

Signature Page

The Principal Stockholders, by their signatures below, hereby accept and agree to perform their obligations set forth in Article VIII of this Agreement.

Signature Page

EXHIBIT A

FORM OF ESCROW AGREEMENT

This Escrow Agreement (this “Escrow Agreement”) is made and entered into as of this          day of October, 2007, by and among iSarla, Inc., a Delaware corporation (“iSarla” or the “Company”), Forgent Networks, Inc., a Delaware corporation (“Parent”), ▇▇▇▇▇ ▇▇▇▇ (the “Stockholder Representative”) and ▇▇▇▇▇ Fargo Bank, National Association, a national banking association, as escrow agent, with reference to the following:

RECITALS:

WHEREAS, Parent, the Company and Cheetah Acquisition Company, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”), have entered into that certain Agreement and Plan of Merger, dated as of September 11, 2007  (the “Merger Agreement”), pursuant to which Merger Sub will merge with and into the Company (the “Merger”);

WHEREAS, pursuant to the Merger Agreement, a portion of the Merger Consideration will be placed in escrow;

WHEREAS, Parent and the Company desire that ▇▇▇▇▇ Fargo Bank, National Association act as the initial escrow agent for the portion of the Merger Consideration to be placed in escrow;

WHEREAS, ▇▇▇▇▇ Fargo Bank, National Association is willing to act as such initial escrow agent; and

WHEREAS, the Parties desire to set forth the duties and obligations of the Escrow Agent.

NOW, THEREFORE, in consideration of the recitals and of the respective agreements and covenants contained herein, and intending to be legally bound hereby, the Parties agree as follows:

ARTICLE I

1.1                                 Definitions. For purposes of this Escrow Agreement, capitalized terms not otherwise defined herein shall have the meaning given or referenced in Appendix 1 attached hereto and incorporated herein by this reference. Any capitalized terms for which no definition is given or referenced in this Escrow Agreement or in Appendix 1 shall have the meaning given such terms in the Merger Agreement.

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1.2                                 Interpretation.

(a)                                  Unless otherwise stated, the terms “Article,” “Section,” “Exhibit” and “Appendix” refer to the specified Article, Section, Exhibit or Appendix of this Escrow Agreement.

(b)                                 Whenever the words “include”, “includes” or “including” (or any variation thereof) are used in this Escrow Agreement, they shall be deemed to be followed by the words “without limitation,” and shall not be construed to limit any general statement which any such word follows to the specific or similar items or matters immediately following such word, unless otherwise expressly stated.

(c)                                  The words “hereof”, “herein” and “herewith” and words of similar import shall, unless otherwise stated, be construed to refer to this Escrow Agreement as a whole and not to any particular provision of this Escrow Agreement.

(d)                                 The plural of any defined term shall have a meaning correlative to such defined term, and words denoting any gender shall include all genders. Where a word or phrase is defined herein, each of its other grammatical forms shall have a corresponding meaning.

(e)                                  A reference to any party to this Escrow Agreement or any other agreement or document shall include such party’s permitted successors, assigns and transferees.

(f)                                    The Parties have participated jointly in the negotiation and drafting of this Escrow Agreement. In the event an ambiguity or question of intent or interpretation arises, this Escrow Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Escrow Agreement.

ARTICLE II

2.1                                 Escrow Fund.

(a)                                  Prior to the Closing, Parent shall deposit the Cash Escrow and the Escrow Stock (together, the “Initial Escrow Consideration”) with Escrow Agent. The Cash Escrow will be held in a segregated escrow account (the “Escrow Account”). The Escrow Stock will be registered in the name of the Escrow Agent, as agent for the Eligible Company Holders, and shall be deposited with the Escrow Agent. The amounts in the Escrow Account and the number of shares of Escrow Stock shall be known collectively as the “Escrow Fund”.

The Escrow Agent’s sole obligation with respect to the Escrow Stock shall be to deliver such Escrow Stock and associated stock powers to the appropriate party (if the entire amount of such Escrow Stock is being released) or to deliver such Escrow Stock and associated stock powers to the stock transfer agent for the Escrow Stock along with appropriate instructions to (a) issue new certificates in the name of the person or party in the amount of shares such person or party is entitled to receive and (b) issue new certificates in the name of the Escrow Agent for the balance

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of such Escrow Stock. The Escrow Agent shall have no liability in the event of any mistake, delay or failure to act on the part of the stock transfer agent for the Escrow Stock.

(b)                                 The Escrow Account shall be maintained by the Escrow Agent as a separate account for the benefit of Parent and the Eligible Company Holders as provided in this Escrow Agreement.

2.2                                 Acceptance of Appointment as Escrow Agent. The Escrow Agent, by signing this Escrow Agreement, accepts the appointment as Escrow Agent and agrees to hold and distribute the Escrow Fund in accordance with the terms of this Escrow Agreement.

2.3                                 Investment; Taxes.

(a)                              Pending disbursement of the Escrow Fund, the Escrow Agent shall invest the cash portion of the Escrow Fund in (i) a money market fund invested in short-term marketable securities issued or guaranteed by the federal government of the United States, a ▇▇▇▇▇ Fargo Bank Money Market Deposit Account (the “MMDA”) or (iii) such other forms of investment as shall be jointly directed in writing by Parent and the Stockholder Representative (“Permitted Investments”). All interest and other income earned or otherwise distributed on the Escrow Fund shall, until disbursed, also constitute a part of the Escrow Fund and shall, pending disbursement, be invested in Permitted Investments. Unless the Escrow Agent received other investment directions, moneys on deposit in the Escrow Fund will be invested in the MMDA. The undersigned parties understand that amounts on deposit in the MMDA are insured, subject to the applicable rules and regulations of the Federal Deposit Insurance Corporation (FDIC), in the basic FDIC insurance amount of $100,000 per depositor, per insured bank. This includes principal and accrued interest up to a total of $100,000.  The undersigned parties understand that deposits in the MMDA are not secured.

(b)                                 As and when any amount of the Permitted Investments (if applicable) is needed for a payment under this Escrow Agreement, the Escrow Agent shall cause a sufficient amount of the Permitted Investments to be converted into cash, if and to the extent there are Permitted Investments. The Escrow Agent shall not be responsible for any costs or fees incurred in selling or converting any Permitted Investments and any such amounts shall be payable from the cash received upon conversion of such Permitted Investments.

(c)                                  For tax purposes, the Escrow Fund shall be property of the Eligible Company Holders and all interest and other income earned on the Escrow Fund shall be income of the Eligible Company Holders determined on a basis consistent with the pro rata distribution described in Section 2.4(b) of this Escrow Agreement and all Parties hereto (other than Escrow Agent) shall file all tax returns consistent with such treatment. Prior to Closing, iSarla, Parent, the Stockholder Representative and the Eligible Company Holders shall provide the Escrow Agent with certified tax identification numbers by furnishing appropriate forms W-9 or W-8 and such other forms and documents that the Escrow Agent may request.  The parties understand that if such tax reporting documentation is not provided and certified to the Escrow Agent, the

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Escrow Agent may be required by the Internal Revenue Code of 1986, as amended, and the Regulations promulgated thereunder, to withhold a portion of any interest or other income earned on the investment of monies or other property held by the Escrow Agent pursuant to this Escrow Agreement.

2.4                                 Distribution of Escrow Fund.

(a)                                  In the event Parent has made, prior to the Final Escrow Release Date, a claim for indemnification in a Parent Claim Notice (in substantially the form attached hereto as Exhibit A) delivered to the Stockholder Representative and the Escrow Agent, and such claim has not been finally determined or has otherwise been objected to as provided herein (a “Pending Claim”), the Escrow Agent shall withhold from distribution to the Eligible Company Holders a portion of the Escrow Fund equal to the Damages set forth in such Parent Claim Notice (such amount being a “Pending Claim Holdback”) until such time as either the Pending Claim has been finally determined or the objection resolved, as applicable, in which case the appropriate amounts will be either distributed to Parent or returned to the Escrow Fund (for distribution to the Eligible Company Holders as provided in Section 2.4(c) below), or both, as the case may be, all as more fully set forth herein. In addition, in the event Parent and the Stockholder Representative provide written notice to the Escrow Agent that the Stipulated Closing Net Working Capital Statement indicates a Working Capital Deficit, then the amount specified in such notice as the difference between $0 and the Working Capital Deficit shall be as soon as practical thereafter paid to Parent from the Escrow Fund.

(b)                                 Any amounts to be distributed from the Escrow Fund to the Eligible Company Holders shall be distributable to such Eligible Company Holders on a pro rata basis based upon their relative entitlement or assumed entitlement to receive Merger Consideration as specifically set forth in the spreadsheet attached hereto as Exhibit B (the “Spreadsheet”), upon which the Escrow Agent shall be entitled to conclusively rely.

(c)                                  Subject to any claim for reimbursement by the Stockholder Representative as contemplated by Section 2.4(d) hereof, the Available Escrow Amount shall be distributed as follows:

(i)                                     the amount by which the Available Escrow Amount (immediately prior to such distribution) exceeds seven and one-half percent (7.5%) of the Merger Consideration shall be distributed to the Eligible Company Holders on the date which is twelve (12) months after the Closing Date (the “First Escrow Release Date”);

(ii)                                  all remaining Available Escrow Amount and any other amounts which shall have been delivered into the Escrow Account shall be distributed to the Eligible Company Holders on the date which is eighteen (18) months after the Closing Date (the “Final Escrow Release Date”); and

(iii)                               any further amounts which, following the Final Escrow Release Date, shall be delivered into the Escrow Account or otherwise become available for distribution

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to the Eligible Company Holders (including amounts which may previously have been withheld due to a Pending Claim Holdback where final resolution of the related Pending Claim yields less than a full payment of the amount at issue to Parent), together with all interest and other income which has accrued thereon, shall be distributed to the Eligible Company Holders immediately following the date any such amount shall be so delivered or otherwise become so available.

(d)                                 The Stockholder Representative shall be entitled to be reimbursed from any portion of the Escrow Fund otherwise to be distributed to the Eligible Company Holders pursuant to the foregoing Section 2.4(c) for any loss, liability or expense incurred without bad faith on the part of the Stockholder Representative and arising out of or in connection with the acceptance or administration of the Stockholder Representative duties under the Merger Agreement (including counsel fees and other out-of-pocket expenses), such reimbursement to be made directly from the Escrow Fund by the Escrow Agent. The Escrow Agent may rely on the written instruction of the Stockholder Representative in this regard.

(e)                                  If the Escrow Agent is not able to deliver any portion of the Escrow Fund to the proper recipient within one (1) year of the date that final distribution of any remaining amount of the Escrow Fund should otherwise have been made pursuant to the foregoing Section 2.4(c) (or immediately prior to such earlier date on which any payment in respect thereof would otherwise escheat to or become the property of any Governmental Body), such portion of the Escrow Fund shall be delivered to Parent and the proper recipient shall thereafter look only to Parent, and only as a general creditor, for payment of such recipient’s claim for such portion of the Escrow Fund, subject to applicable abandoned property, escheat and similar laws.

(f)                                    Notwithstanding any provision of this Escrow Agreement to the contrary, in the event that any payment is made to a holder of Dissenting Shares by the Surviving Corporation or Parent in respect of appraisal rights as contemplated by the Merger Agreement, then (i) the portion of the Escrow Fund which would have represented the potential distribution to such holder shall instead be distributed to Parent and (ii) such holder’s former shares of Company Common Stock shall be removed from any calculation to determine the pro rata right of such holder to participate in any distribution of the Escrow Fund. The Escrow Agent may rely on the written instruction of the Surviving Corporation or the Parent in this regard. The Surviving Corporation or the Parent shall have the obligation to recalculate the pro rata right of holders to participate in any distribution of the Escrow Fund referred to in clause (ii) of the second preceding sentence, and in the absence of delivery to the Escrow Agent of such recalculation the Escrow Agent shall be entitled to rely on the existing calculation.

ARTICLE III

3.1                                 Rights and Responsibilities of Escrow Agent.

(a)                                  The duties, responsibilities and obligations of the Escrow Agent shall be limited to those set forth herein and no duties, responsibilities or obligations shall be inferred or implied. The Escrow Agent shall not be subject to, nor be required to comply with, any other

5

agreement between the Company or Parent or to which the Company or Parent is a party, even though reference thereto may be made herein, or to comply with any direction or instruction (other than those contained herein or delivered in accordance with this Escrow Agreement) from the Company, Parent, the Stockholder Representative or any entity or person acting on the respective behalf of any of them. The Escrow Agent shall not be required to, and shall not, expend or risk any of its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder.

(b)                                 If at any time the Escrow Agent is served with any judicial or administrative order, judgment, decree, writ or other form of judicial or administrative process which in any way affects the Escrow Fund (including orders of attachment or garnishment or other forms of levies or injunctions or stays relating to the transfer of the Escrow Fund), the Escrow Agent is authorized to comply therewith in any manner as it deems appropriate; and if the Escrow Agent complies with any such judicial or administrative order, judgment, decree, writ or other form of judicial or administrative process, the Escrow Agent shall not be liable to any of the Parties or any other person or entity even though such order, judgment, decree, writ or process may be subsequently modified or vacated or otherwise determined to have been without legal force or effect.

(c)                                  The Escrow Agent shall not be liable for any action taken or omitted or for any loss or injury resulting from its actions or its performance or lack of performance of its duties hereunder in the absence of gross negligence or willful misconduct on its part. IN NO EVENT SHALL THE ESCROW AGENT BE LIABLE (i) for acting in accordance with or relying upon any instruction, notice, demand, certificate or document delivered in accordance with this Escrow Agreement by Parent or the Stockholder Representative, (ii) DIRECTLY, OR INDIRECTLY, FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL LOSSES OR DAMAGES OF ANY KIND WHATSOEVER (INCLUDING WITHOUT LIMITATION LOST PROFITS), EVEN IF THE ESCROW AGENT SHALL BE ADVISED OF THE POSSIBILITY OF SUCH LOSSES OR DAMAGES AND REGARDLESS OF THE FORM OF ACTION, or (iii) for an amount in excess of the value of the Escrow Fund, valued as of the applicable date.

(d)                                 The Escrow Agent may consult with legal counsel of its own selection as to any matter relating to this Escrow Agreement, and the Escrow Agent shall not incur any liability in acting in good faith in accordance with any advice from such counsel.

(e)                                  The Escrow Agent shall not incur any liability for not performing any act or fulfilling any duty, obligation or responsibility hereunder by reason of any occurrence beyond the control of the Escrow Agent (including any act or provision of any present or future law or regulation or governmental authority, any act of God or war, or the unavailability of the Federal Reserve Bank wire or telex or other wire or communication facility).

(f)                                    Unless otherwise specifically set forth herein, the Escrow Agent shall proceed as soon as practicable to collect any checks or other collection items at any time deposited hereunder. All such collections shall be subject to the Escrow Agent’s usual collection practices or terms regarding items received by the Escrow Agent for deposit or collection. The

6

Escrow Agent shall not be required, nor have any duty, to notify anyone of any payment or maturity under the terms of any instrument deposited hereunder, to take any legal action to enforce payment of any check, note or security deposited hereunder or to exercise any right or privilege which may be afforded to the holder of any such security.

(g)                                 The Escrow Agent shall provide to Parent and the Stockholder Representative monthly statements identifying transactions, transfers from, deposits into and holdings of the Escrow Fund.

(h)                                 Notices, instructions or communications shall be in writing and shall be given to the addresses set forth in Section 4.1 below (or to such other addresses as may be substituted therefor by written notification as provided in such Section 4.1). The Escrow Agent is authorized to comply with and rely upon any notices, instructions or other communications believed by it to have been sent or given by Parent or by the Stockholder Representative or by a person or persons authorized by any of them. Whenever under the terms hereof the time for giving a notice or performing an act falls upon a Saturday, Sunday or banking holiday, such time shall be extended to the next day on which the Escrow Agent is open for business.

(i)                                     iSarla, Parent and the Eligible Company Holders hereby jointly and severally agree (but, in the case of the Eligible Company Holders, solely to the extent of their respective pro-rata amounts at the time held in the Escrow Fund) to reimburse the Escrow Agent for, and to indemnify and hold the Escrow Agent harmless from and against, any and all claims, losses, liabilities, costs, damages or expenses (including reasonable attorneys’ fees and expenses) of the Escrow Agent (collectively, “Losses”) arising from or in connection with or related to this Escrow Agreement or being the Escrow Agent hereunder (including Losses incurred by the Escrow Agent in connection with its successful defense, in whole or in part, of any claim of gross negligence or willful misconduct on its part); provided, however, that nothing contained herein shall require Escrow Agent to be indemnified for Losses finally determined to have been primarily caused by the Escrow Agent’s own gross negligence or willful misconduct. The obligations of iSarla, the Parent and the Stockholder Representative hereunder shall survive the termination of this Escrow Agreement and the resignation or removal of the Escrow Agent.

(j)                                     Parent and the Stockholder Representative may, acting jointly, remove the Escrow Agent at any time by giving to the Escrow Agent ten (10) calendar days’ prior notice in writing signed by Parent and the Stockholder Representative. The Escrow Agent may resign at any time by giving Parent and the Stockholder Representative thirty (30) calendar days prior written notice thereof. Within ten (10) calendar days after giving the foregoing notice of removal to the Escrow Agent or receiving the foregoing notice of resignation from the Escrow Agent, Parent and the Stockholder Representative shall appoint a successor Escrow Agent. If a successor Escrow Agent has not accepted such appointment by the end of such ten (10)-day period, the Escrow Agent may, in its sole discretion, apply to a court of competent jurisdiction for the appointment of a successor Escrow Agent or for other appropriate relief. Upon receipt of the identity of the successor Escrow Agent, the Escrow Agent shall deliver the Escrow Fund then held hereunder to the successor Escrow Agent. Upon delivery of the Escrow Fund to the

7

successor Escrow Agent, the Escrow Agent shall have no further duties, responsibilities or obligations hereunder.

(k)                                  In the event of any ambiguity or uncertainty hereunder or in any notice, instruction of other communication received by the Escrow Agent hereunder, the Escrow Agent may, in its sole discretion, refrain from taking any action other than retaining possession of the Escrow Fund, unless the Escrow Agent receives written instructions, signed by Parent and the Stockholder Representative, which eliminates such ambiguity or uncertainty. In the event of any dispute between or conflicting claims by or among Parent, the Stockholder Representative and/or any other person or entity with respect to any Escrow Fund, the Escrow Agent shall be entitled, in its sole discretion, to refuse to comply with any and all claims, demands or instructions with respect to such Escrow Fund so long as such dispute or conflict shall continue, and the Escrow Agent shall not be nor become liable in any way to Parent or the Eligible Company Holders for failure or refusal to comply with such conflicting claims, demands or instructions. The Escrow Agent shall be entitled to refuse to act until, in its sole discretion, either (i) such conflicting or adverse claims or demands shall have been determined by a final order, judgment or decree of a court of competent jurisdiction, which order, judgment or decree is not subject to appeal, or settled by agreement between the conflicting parties as evidenced in a writing satisfactory to the Escrow Agent, or (ii) the Escrow Agent shall have received security or an indemnity satisfactory to it sufficient to hold it harmless from and against any and all Losses which it may incur by reason of so acting. The Escrow Agent may, in addition, elect, in its sole discretion, to commence an interpleader action or seek other judicial relief or orders as it may deem, in its sole discretion, necessary.

3.2                                 Fees and Expenses of the Escrow Agent. The Escrow Agent shall (a) be paid fees for its services under this Escrow Agreement as provided in the fee letter attached hereto as Exhibit C and (b) be entitled to reimbursement for expenses (including the reasonable fees and disbursements of its counsel) actually incurred by the Escrow Agent in connection with its duties under, or as otherwise contemplated by, this Escrow Agreement (collectively, the “Escrow Agent Fees and Expenses”). All Escrow Agent Fees and Expenses shall be paid by Parent. The Escrow Agent shall have, and is hereby granted, a prior lien upon any property, cash, or assets of the Escrow Fund, with respect to its unpaid fees, non-reimbursed expenses and unsatisfied indemnification rights, superior to the interests of any other persons or entities. The Escrow Agent shall be entitled and is hereby granted the right to set off and deduct any unpaid fees, non-reimbursed expenses and unsatisfied indemnification rights from amounts on deposit in the Escrow Fund.

ARTICLE IV

4.1                                 Notices. All notices, requests, claims, demands and other communications under this Escrow Agreement shall be in writing and shall be deemed given if delivered personally, telecopied (which is confirmed) or sent by overnight courier (providing proof of delivery) to the following parties at the following addresses (or at such other address(es) as shall be specified by like notice):

8

(a)                                  If to the Company, to:

iEmployee, Inc.
c/o Forgent Networks, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention:  ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
Facsimile:  (▇▇▇) ▇▇▇-▇▇▇▇

with a copy (which shall not constitute notice) to:

▇▇▇▇▇▇▇▇ PC
5400 Renaissance Tower
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇  ▇▇▇▇▇
Attention:  ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile:  (▇▇▇) ▇▇▇-▇▇▇▇

(b)                                 If to Parent or Merger Sub, to:

Forgent Networks, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention:  ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
Facsimile:  (▇▇▇) ▇▇▇-▇▇▇▇

with a copy (which shall not constitute notice) to:

▇▇▇▇▇▇▇▇ PC
5400 Renaissance Tower
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇  ▇▇▇▇▇
Attention:  ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile:  (▇▇▇) ▇▇▇-▇▇▇▇

(c)                                  If to the Stockholder Representative:

▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇  ▇▇▇▇▇
Facsimile:  (▇▇▇) ▇▇▇-▇▇▇▇

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with a copy (which shall not constitute notice) to:

▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ & Fish, LLP
World Trade Center West
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention:  ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile:  (▇▇▇) ▇▇▇-▇▇▇▇

(d)                                 If to the Escrow Agent, to:

Well ▇▇▇▇▇ ▇▇▇▇, ▇. ▇.
▇▇▇ ▇▇▇▇▇-▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇^▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:   ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile:  ▇▇▇-▇▇▇-▇▇▇▇

The Escrow Agent, Parent, the Company and the Stockholder Representative may change their address or the person to whom notices or copies thereof shall be directed by notice to the others as provided in this Section 4.2.

4.2                                 Stockholder Representative. The Stockholder Representative may resign upon thirty (30) days’ notice to Parent, each Eligible Company Holder and the Escrow Agent. The Stockholder Representative may be replaced by the Eligible Company Holders from time to time upon not less than five (5) days’ prior written notice to Parent; provided, however, that the Stockholder Representative may not be replaced unless Eligible Company Holders holding more than fifty percent (50%) of the then present percentage interests in the Escrow Fund (assuming, for this purpose, a distribution of the entire amount of the Escrow Fund on the date of determination) agree to such replacement. No bond shall be required of the Stockholder Representative, and the Stockholder Representative shall receive no compensation for its services.

4.3                                 Assignment. This Escrow Agreement and the rights and duties hereunder shall be binding upon and inure to the benefit of the Parties and the successors and assigns of each of the Parties. Except as expressly provided herein, no rights, obligations or liabilities hereunder shall be assignable by any Party without the prior written consent of the other Parties. The interests of an Eligible Company Holder are not assignable or transferable unless and until released pursuant to the terms of this Escrow Agreement. The forgoing notwithstanding, no assignment of the interests of any of the Parties shall be binding on the Escrow Agent unless and until written notice of such assignment shall be delivered to and acknowledged by the Escrow Agent.

4.4                                 Amendment. This Escrow Agreement may be amended, modified or waived only by an instrument in writing duly executed by Parent, the Company, the Escrow Agent and the Stockholder Representative.

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4.5                                 Governing Law. This Escrow Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without regard to principles of conflict of laws thereof.

4.6                                 Construction. The headings in this Escrow Agreement are solely for convenience of reference and shall not be given any effect in the construction or interpretation of this Escrow Agreement.

4.7                                 Termination. This Agreement shall terminate upon the distribution in full of the Escrow Fund.

4.8                                 Counterparts. This Escrow Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute a single instrument.

4.9                                 Severability. The invalidity, illegality or unenforceability of any provision of this Escrow Agreement shall in no way affect the validity, legality or enforceability of any other provision, and if any provision is held to be enforceable as a matter of law, the other provisions shall not be affected thereby and shall remain in full force and effect.

4.10                           Merger Agreement. Nothing in this Escrow Agreement is intended, or shall be deemed, to modify in any way the agreements between Parent, Merger Sub and the Company set forth in, and the other provisions of, the Merger Agreement. As between the parties to, and the intended third party beneficiaries of, the Merger Agreement, the provisions of the Merger Agreement shall control in the event of any inconsistency between the provisions of this Escrow Agreement and the provisions of the Merger Agreement. Notwithstanding the foregoing, the Escrow Agent shall not be construed or deemed, for any purpose, to be a party to the Merger Agreement, and its rights and obligations shall be governed solely by this Escrow Agreement.

[Remainder of page intentionally left blank.]

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IN WITNESS WHEREOF, the Parties hereto have caused this Escrow Agreement to be executed by their duly authorized officers as of the day and year first above written.

12

EXHIBIT A

Form of Parent Claim Notice

[Date]

[Stockholder Representative]

[Address]

[City, State, Zip]

This notice is delivered to you by Forgent Networks, Inc., a Delaware corporation (“Parent”) and/or iSarla, Inc., a Delaware corporation (the “Surviving Corporation”) pursuant to Section 8.2 of that certain Agreement and Plan of Merger, dated as of September 11, 2007, by and among Parent, Cheetah Acquisition Company, Inc., a Delaware corporation, and the Surviving Corporation (the “Merger Agreement”). Capitalized terms not defined herein have the meaning set forth in the Merger Agreement.

[Specify the claim.]

The Damages set forth above have actually been incurred or suffered by a Parent Indemnified Party.

This Parent Claim Notice shall serve as Parent’s formal notice, claim and demand for indemnification. Nothing in this Parent Claim Notice shall be deemed to be a waiver of any other claim which an Parent Indemnified Party may be entitled to assert pursuant to the provisions of the Merger Agreement.

EXHIBIT B

Spreadsheet

[attached]

EXHIBIT C

Fee Letter

[attached]

APPENDIX 1

Definitions

For purposes of this Escrow Agreement:

“Additional Escrow Stock” means dividends paid in stock declared with respect to the Escrow Stock.

“Adjusted Company Value” shall mean the Company Value minus the sum of (i) $2,000,000, being the combined value of the Ceridian Cash Payment and the Ceridian Stock Payment, and (ii) the product of the Global Accelerator Stock Payment multiplied by the Average Closing Price.

“Adjusted Fully Diluted Share Amount” shall mean the Fully Diluted Share Amount minus the sum of (i) the Ceridian Company Shares, and (ii) the Global Accelerator Company Shares.

“Adjusted Net Cash Payment Amount” shall mean the Net Cash Payment Amount minus the sum of (i) the Ceridian Cash Payment, and (ii) the Aggregate Non-Participating Holder Cash Payments.

“Adjusted Stock Payment Amount” shall mean the Total Stock Payment Amount minus the sum of (i) the Ceridian Stock Payment, and (ii) the Global Accelerator Stock Payment.

“Adjusted Stock Payment Value” means the Initial Stock Payment Value minus the amount of any Elective Cash Payment made by Parent pursuant to Section 2.9(b)(ii) of the Merger Agreement.

“Aggregate Non-Participating Holder Cash Payments” shall mean the aggregate amount of the cash payments made to the Non-Participating Holders pursuant to Section 2.7(a)(iii) of the Merger Agreement.

“Available Escrow Amount” means an amount equal to the Initial Escrow Consideration, plus any accrued interest on the Cash Escrow, plus any Additional Escrow Stock, less the amount of any Working Capital Deficit (if applicable), less the aggregate amount of any Pending Claim Holdbacks (but only for so long as, and to the extent that, they remain pending), less the aggregate amount distributed to Parent pursuant to the indemnification provisions benefiting Parent in Article VIII of the Merger Agreement, less the aggregate amount distributable or previously distributed from the Escrow Consideration to Eligible Company Holders as contemplated pursuant to the provisions of the Merger Agreement pertaining to the Escrow Consideration and the Escrow Agreement.

“Average Closing Price” means the average of the closing prices for the Parent Common Stock for the twenty (20) trading days preceding the Closing, but excluding the three (3) highest and three (3) lowest closing prices during such period.

“Cash Escrow” means cash in the amount of fifteen percent (15%) of the Net Cash Payment Amount.

“Ceridian Cash Payment” shall mean $1,000,000.

“Ceridian Company Shares” means the 5,720,934 shares of Company Common Stock held by Ceridian Corporation immediately prior to the Effective Time.

“Ceridian Stock Payment” shall mean the number of shares of Parent Company Stock equal to $1,000,000 divided by the Average Closing Price.

“Certificate of Merger” means a certificate of merger with respect to the Merger in such form as is required by and executed in accordance with the relevant provisions of the Delaware General Corporation Law.

“Certificates” means certificates representing shares of Company Common Stock.

“Closing” means the consummation of the Merger.

“Closing Consideration” means:

(i)                                     With respect to Ceridian Corporation:  (x) a check or, if requested, a wire transfer of immediately available funds, in the amount of the Ceridian Cash Payment minus Ceridian’s pro rata share of the Cash Escrow, being an amount equal to the Cash Escrow multiplied by the quotient of (I) the Ceridian Cash Payment, divided by (II) the total amount of cash Merger Consideration which all Eligible Company Holders are entitled to receive under Section 2.7 of the Merger Agreement; (y) a stock certificate representing the number of shares of Parent Company Stock equal to the Ceridian Stock Payment, minus Ceridian’s pro rata share of the Escrow Stock, being an amount equal to the Escrow Stock multiplied by the quotient of (I) the Ceridian Stock Payment, divided by (II) the total number of shares of Parent Common Stock which all Eligible Company Holders are entitled to receive under Section 2.7 of the Merger Agreement (with such number of shares being rounded to the next lowest whole number so as to eliminate any fractional shares); and (z) a check or, if requested, a wire transfer of immediately available funds, representing the amount of cash payable in lieu of any fractional shares;

(ii)                                  With respect to Global Accelerator:  (x) a stock certificate representing the number of shares of Parent Company Stock equal to the Global Accelerator Stock Payment, minus Global Accelerator’s pro rata share of the Escrow Stock, being an amount equal to the Escrow Stock multiplied by the quotient of (I) the Global Accelerator Stock Payment, divided by (II) the total number of shares of Parent Common Stock which all Eligible Company Holders are entitled to receive under Section 2.7 of the Merger Agreement (with such number of shares being rounded to the next lowest whole number so as to eliminate any fractional shares); and (y) a check or, if requested, a wire transfer of

immediately available funds, representing the amount of cash payable in lieu of any fractional shares;