AGREEMENT AND PLAN OF MERGER Dated as of April 10, 2009 by and among IMAGE HOLDINGS CORPORATION, IC ACQUISITION CORP. and INFOCUS CORPORATION

ARTICLE ONE

Section 1.1

Section 1.2

Section 1.3

Section 1.4

ARTICLE TWO

Section 2.1

Section 2.2

Section 2.3

Section 2.4

Section 2.5

Section 2.6

Section 2.7

Section 2.8

Section 2.9

Section 2.10

Section 2.11

Section 2.12

ARTICLE THREE

Section 3.1

Section 3.2

Section 3.3

Section 3.4

Section 3.5

Section 3.6

ARTICLE FOUR

Section 4.1

Section 4.2

Section 4.3

Section 4.4

Section 4.5

Section 4.6

Section 4.7

Section 4.8

Section 4.9

Section 4.10

Section 4.11

Section 4.12

Section 4.13

Section 4.14

Section 4.15

Section 4.16

Section 4.17

Section 4.18

Section 4.19

Section 4.20

Section 4.21

Section 4.22

Section 4.23

Section 4.24

Section 4.25

Section 4.26

ARTICLE FIVE

Section 5.1

Section 5.2

Section 5.3

Section 5.4

Section 5.5

Section 5.6

ARTICLE SIX

Section 6.1

Section 6.2

Section 6.3

Section 6.4

Section 6.5

Section 6.6

Section 6.7

Section 6.8

Section 6.9

Section 6.10

Section 6.11

Section 6.12

Section 6.13

Section 6.14

Section 6.15

ARTICLE SEVEN

Section 7.1

ARTICLE EIGHT

Section 8.1

Section 8.2

Section 8.3

Section 8.4

Section 8.5

ARTICLE NINE

Section 9.1

Section 9.2

Section 9.3

Section 9.4

Section 9.5

Section 9.6

Section 9.7

Section 9.8

Section 9.9

Section 9.10

Parent on behalf of the Purchaser expressly reserves the right from time to time, subject to Section 1.1(c), to waive any of the Tender Offer Conditions or to increase the Offer Price or to make any other changes in the terms and conditions of the Offer; provided that, without the prior written consent of the Company, the

Purchaser shall not decrease the Offer Price, change the form of consideration payable in the Offer, decrease the number of Company Shares sought to be purchased in the Offer, impose additional conditions to the Offer or amend any other term of the Offer in any manner that is adverse to the holders of Company Shares. The Offer shall remain open until the date that is twenty (20) business days (as such term is defined in Rule 14d-1(g)(3) under the Exchange Act) after (and including the day of) the commencement of the Offer (the “Expiration Date”), unless the Purchaser shall have extended the period of time for which the Offer is open pursuant to, and in accordance with, the terms of the succeeding two sentences or as may be required by applicable Law, in which event the term “Expiration Date” shall mean the latest time and date as the Offer, as so extended, may expire; provided, however, that the Purchaser may provide a subsequent offering period (and one or more extensions thereof) after the Expiration Date, in accordance with Rule 14d-11 under the Exchange Act. If at any Expiration Date, any of the Tender Offer Conditions is not satisfied or waived by the Purchaser, (i) the Purchaser shall extend the Offer from time to time for periods of not more than five (5) Business Days each until the date that is twenty (20) Business Days after the initial Expiration Date (for the avoidance of doubt, the initial Expiration Date is the twentieth Business Day after the commencement of the Offer) (as long as the Company Board continues to recommend that the Company’s shareholders accept the Offer, tender their Company Shares to the Purchaser pursuant to the Offer, and, to the extent necessary, approve the Merger and approve and adopt this Agreement), and (ii) after the expiration of the twenty (20) Business Day period referred to in clause (i) above, the Purchaser may extend the Offer from time to time for periods of not more than ten (10) Business Days each until the earlier of (x) the date on which all of the Tender Offer Conditions are satisfied or waived or (y) the date on which this Agreement is terminated in accordance with Article Eight hereof. Notwithstanding the foregoing, the Purchaser and Parent shall extend the Expiration Date for any period required by the applicable rules and regulations of the SEC, the NASDAQ Global Market (“NASDAQ”) or any other stock exchange or automated quotation system applicable to the Offer. Subject to the terms of the Offer and this Agreement and the satisfaction or waiver of all the Tender Offer Conditions as of the Expiration Date, the Purchaser will accept for payment and pay for all Company Shares validly tendered and not validly withdrawn pursuant to the Offer promptly after the Expiration Date. Without the prior written consent of the Company, the Purchaser shall not accept for payment or pay for any Company Shares in the Offer if, as a result, the Purchaser would acquire less than the number of Company Shares necessary to satisfy the Minimum Condition (as defined in Annex I hereto, except that for purposes of this provision the reference in such definition to “65%” shall be deemed to be a reference to “a majority”).

Parent and the Purchaser represent that the Offer Documents will comply in all material respects with the provisions of applicable federal securities Laws and, on the date filed with the SEC and on the date first published, sent or given to the Company’s shareholders, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in

order to make the statements made therein, in light of the circumstances under which they were made, not misleading, except that no representation is made by Parent or the Purchaser with respect to information supplied by the Company in writing for inclusion in the Offer Documents. The Company represents that the information supplied by the Company in writing for inclusion in the Offer Documents will comply in all material respects with the provisions of applicable federal securities Laws and, on the date filed with the SEC and on the date first published, sent or given to the Company’s shareholders, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. Each of Parent and the Purchaser, on the one hand, and the Company, on the other hand, agrees promptly to correct any information provided by it for use in the Offer Documents if and to the extent that it shall have become false or misleading in any material respect, and the Purchaser further agrees to take all steps necessary to cause the Offer Documents as so corrected to be filed with the SEC and to be disseminated to shareholders of the Company, in each case, as and to the extent required by applicable federal securities Laws.

The Company shall, after affording Parent a reasonable opportunity to review and comment thereon (and after giving due consideration to all reasonable additions, deletions or changes suggested thereto by Parent and its counsel), file with the SEC and mail to the holders of Company Shares, concurrently with the filing by Parent and the Purchaser of the Schedule TO, a Solicitation/Recommendation Statement on Schedule 14D-9 (together with any amendments or supplements

thereto, and including all exhibits thereto, the “Schedule 14D-9”) setting forth the Company Recommendation, and shall disseminate the Schedule 14D-9 as required by Rule 14d-9 promulgated under the Exchange Act. Subject to Section 6.2, the Schedule 14D-9 will set forth, and the Company hereby represents, that the Company Board, at a meeting duly called and held at which a quorum was present throughout, has unanimously (i) determined that this Agreement, including the Offer and the Merger, is advisable; (ii) declared that this Agreement and the transactions contemplated hereby, including the Offer and the Merger, taken together, are fair to and in the best interests of the Company and the Company’s shareholders; (iii) adopted this Agreement in accordance with the OBCA and approved the transactions contemplated hereby, including the Offer and the Merger and the Support Agreement, which approval constituted approval under the provisions of Sections 60.825 through 60.845 of the OBCA as a result of which this Agreement and the transactions contemplated hereby, including the Offer and the Merger, as well as the Support Agreement and the transactions contemplated thereby, are not and will not be subject to the provisions of, or any restrictions under, the provisions of Sections 60.825 through 60.845 of the OBCA; (iv) resolved to recommend that the Company’s shareholders accept the Offer, tender their Company Shares to the Purchaser pursuant to the Offer and, to the extent necessary, approve the Merger and approve and adopt this Agreement (such recommendation, the “Board Recommendation”); (v) approved an amendment to the Rights Agreement so that the Rights Agreement does not apply to any of the transactions contemplated hereby, including the Offer, the Merger, the Top-Up Option and the Support Agreement; (vi) taken all action necessary to render Sections 60.801 through 60.816 of the OBCA inapplicable to the Offer and the Merger; and (vii) taken all actions necessary to ensure that the Offer and the Merger, to the extent of the Company Board’s power and authority and to the extent permitted by Law, shall not be subject to any Takeover Laws of any jurisdiction that may purport to be applicable to the Offer, the Merger, this Agreement or the transactions contemplated hereby. The Company hereby consents to the inclusion of the foregoing determinations and approvals in the Offer Documents, and, subject to Section 6.2, the Company hereby consents to the inclusion of the Board Recommendation in the Offer Documents.

The Company represents that the Schedule 14D-9 will comply in all material respects with the provisions of applicable federal securities Laws and, on the date filed with the SEC and on the date first published, sent or given to the Company’s shareholders, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading, except that no representation is made by the Company with respect to information supplied by Parent or the Purchaser in writing for inclusion in the Schedule 14D-9. Parent and the Purchaser represent that the information supplied by them in writing for inclusion in the Schedule 14D-9 will comply in all material respects with the provisions of applicable federal securities Laws and, on the date filed with the SEC and on the date first published, sent or given to the Company’s shareholders, shall not contain any untrue statement of a material fact

or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. Each of the Company, on the one hand, and Parent and the Purchaser, on the other hand, agree promptly to correct any information provided by either of them for use in the Schedule 14D-9 if and to the extent that it shall have become false or misleading in any material respect, and the Company further agrees to take all steps necessary to cause the Schedule 14D-9 as so corrected to be filed with the SEC and to be disseminated to the holders of Company Shares, in each case, as and to the extent required by applicable federal securities Law.

Subject to compliance with applicable Law, effective upon the acceptance for payment of Company Shares pursuant to the Offer, and from time to time thereafter, Parent shall be entitled to designate such number of directors, rounded up to the next whole number, on the Company Board as is equal to the product of the total number of directors on the Company Board (determined after giving effect to the directors elected pursuant to this sentence) multiplied by the

percentage that the aggregate number of Common Shares beneficially owned by Parent and its Affiliates bears to the total number of Common Shares then outstanding, and the Company shall, upon request of Parent, promptly take all actions necessary to cause Parent’s designees to be so elected, including, if necessary, by increasing the size of the Company Board (including by amending the Bylaws of the Company if necessary) and/or obtaining the resignations of one or more existing directors; provided, however, that Parent shall be entitled to designate at least a majority of the directors on the Company Board as long as Parent and its Affiliates beneficially own a majority of the Common Shares of the Company; provided further, and notwithstanding the foregoing, that prior to the Effective Time, the Company Board shall always have at least two members who were members of the Company Board as of immediately prior to payment by the Purchaser for Company Shares pursuant to the Offer and who are reasonably acceptable to Purchaser (it being acknowledged by the Purchaser that each of Messrs. ▇▇▇▇▇▇▇ and ▇▇▇▇ are acceptable to the Purchaser) (each such member a “Company Director” and, collectively, “Company Directors”). If the number of directors who are Company Directors is reduced below two prior to the Effective Time, the remaining director who is a Company Director shall be entitled to designate a Person to the Company Board who is not an officer, director, employee or designee of the Purchaser or any of its Affiliates and who shall be considered a Company Director for purposes of this Agreement. At each such time Parent is entitled to designate directors on the Company Board, the Company will, subject to any limitations imposed by applicable Law, also cause (i) each committee of the Company Board, (ii) the board of directors of each of the Company Subsidiaries and (iii) each committee of such board of directors of each of the Company Subsidiaries to include persons designated by Parent constituting at least the same percentage of each such committee or board as Parent’s designees constitute on the Company Board.

Following the election or appointment of Parent’s designees pursuant to this Section 1.3 and prior to the Effective Time, any amendment or termination of this Agreement by the Company, any extension by the Company of the time for the performance of any of the obligations or other acts of Parent or the Purchaser, or any waiver of any of the Company’s rights hereunder, will require the concurrence of a majority of the directors of the Company then in office who are Company Directors (or in the case where there are two or fewer directors who are Company Directors, the concurrence of one director who is a Company Director)

if such amendment, termination, extension or waiver would be reasonably likely to adversely affect the minority shareholders of the Company.

Upon the exercise of the Top-Up Option in accordance with Section 1.4(a), the Purchaser shall so notify the Company and shall set forth in such notice (i) the total number of Common Shares that are expected to be owned by Parent, the Purchaser or any direct or indirect wholly owned Subsidiary of Parent or the Purchaser immediately preceding the purchase of the Top-Up Option Shares and (ii) a place and time for the closing of the purchase of the Top-Up Option Shares. The Company shall, as soon as practicable following receipt of such notice, notify Parent and the Purchaser of the number of Common Shares then outstanding, the number of Top-Up Option Shares and the aggregate purchase price therefor. At

the closing of the purchase of the Top-Up Option Shares, the Purchaser shall pay the Company the aggregate price required to be paid for the Top-Up Option Shares, and the Company shall cause to be issued to the Purchaser a certificate representing the Top-Up Option Shares. The aggregate purchase price payable for the Top-Up Shares may be paid by the Purchaser by executing and delivering to the Company a full recourse promissory note having a principal amount equal to the balance of the aggregate purchase price for the Top-Up Shares. Any such promissory note shall bear interest at the rate of interest per annum equal to the rate of interest publicly announced by Bank of America, in the City of New York from time to time during such period, as such bank’s Prime Lending Rate, shall mature on the first anniversary of the date of execution and delivery of such promissory note and may be prepaid without premium or penalty. In the event that this Agreement is terminated after the Top-Up Option is exercised and prior to the Effective Time, all amounts then owing pursuant to the promissory note (including all interest) shall thereupon become immediately due and payable.

The Company shall, after affording Parent a reasonable opportunity to review and comment thereon (and after giving due consideration to all reasonable additions, deletions or changes suggested thereto by Parent and its counsel), file with the SEC a proxy or information statement (together with any amendments thereof or supplements thereto and any other required proxy materials, the “Proxy Statement”) for a special meeting of shareholders relating to the Merger and this

Agreement (the “Special Meeting”). Subject to Section 6.2, the Proxy Statement will set forth that the Company Board, at a meeting duly called and held at which a quorum was present throughout, has unanimously (i) determined that the transactions contemplated by this Agreement are advisable; (ii) declared that this Agreement and the transactions contemplated hereby are fair to and in the best interests of the Company and the Company’s shareholders; (iii) adopted this Agreement in accordance with the OBCA and approved the transactions contemplated hereby, which approval constituted approval under the provisions of Sections 60.825 through 60.845 of the OBCA as a result of which this Agreement and the transactions contemplated hereby, including the Offer and the Merger, as well as the Support Agreement and the transactions contemplated thereby, are not and will not be subject to the provisions of, or any restrictions under, the provisions of Sections 60.825 through 60.845 of the OBCA; (iv) directed that the adoption of this Agreement be submitted to the Company’s shareholders at the Special Meeting; (v) resolved to recommend that the Company’s shareholders approve the Merger and approve and adopt this Agreement; (vi) approved an amendment to the Rights Agreement so that the Rights Agreement does not apply to any of the transactions contemplated hereby, including the Offer, the Merger, the Top-Up Option and the Support Agreement; (vii) taken all action necessary to render Sections 60.801 through 60.816 of the OBCA inapplicable to the Offer and the Merger; and (viii) taken all actions necessary to ensure that the Offer and the Merger, to the extent of the Company Board’s power and authority and to the extent permitted by Law, shall not be subject to any Takeover Laws of any jurisdiction that may purport to be applicable to the Offer, the Merger, this Agreement or the transactions contemplated hereby. The Company shall include in the Proxy Statement the opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC referred to in Section 4.19.

The Company represents that the Proxy Statement will comply in all material respects with the provisions of applicable federal securities Laws and, on the date filed with the SEC and on the date first published, sent or given to the Company’s shareholders, and at the time of the Special Meeting and the Effective Time, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading, except that no representation is made by the Company with respect to information supplied by Parent or the Purchaser in writing for inclusion in the Proxy Statement. Parent and the Purchaser represent that the information supplied by them in writing for inclusion in the Proxy Statement will comply in all material respects with the provisions of applicable federal securities Laws and, on the date filed with the SEC and on the date first published, sent or given to the Company’s shareholders, and at the time of the Special Meeting and the Effective Time, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. Each of the Company, on the one hand, and Parent and the Purchaser, on the other hand, agree promptly to correct any information provided

by either of them for use in the Proxy Statement if and to the extent that it shall have become false or misleading in any material respect, and the Company further agrees to take all steps necessary to cause the Proxy Statement as so corrected to be filed with the SEC and to be disseminated to the holders of Company Shares, in each case, as and to the extent required by applicable federal securities Law.

Promptly after the Effective Time, Parent shall cause the Paying Agent to mail to each record holder of Certificates or Book-Entry Shares whose Company Shares were converted into the right to receive the Merger Price pursuant to Section 2.7

(i) a form of letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon proper delivery of the Certificates (or affidavits of loss in lieu thereof) to the Paying Agent and shall be in such form and have such other provisions as Parent may reasonably specify) and (ii) instructions for use in surrendering such Certificates or Book-Entry Shares and receiving the Merger Price in respect thereof. Upon the surrender of each such Certificate (or affidavit of loss in lieu thereof) or Book-Entry Share to the Paying Agent together with such letter of transmittal, duly completed and validly executed in accordance with the instructions thereto, the Paying Agent shall pay the holder of such Certificate or Book-Entry Shares the Merger Price multiplied by the number of Company Shares formerly represented by such Certificate, or such aggregate number of Book-Entry Shares, in consideration therefor, and such Certificate or Book-Entry Share shall forthwith be cancelled. Until so surrendered, each such Certificate or Book-Entry Share shall represent solely the right to receive the Merger Price relating thereto. No interest or dividends shall be paid or accrued on the Merger Price. If the Merger Price (or any portion thereof) is to be delivered to any Person other than the Person in whose name the Certificate formerly representing Company Shares surrendered therefor is registered, it shall be a condition to such right to receive such Merger Price that the Certificate so surrendered shall be properly endorsed or otherwise be in proper form for transfer and that the Person surrendering such Company Shares shall pay to the Paying Agent any transfer or other similar taxes required by reason of the payment of the Merger Price to a Person other than the registered holder of the Certificate surrendered, or shall establish to the satisfaction of the Paying Agent that such tax has been paid or is not applicable.

The Company has delivered to or made available to Parent and Purchaser prior to the execution of this Agreement correct and complete copies of (i) any amendments to the Company’s certificate of incorporation and bylaws as currently in effect (the “Company Governing Documents”) not included in the Company SEC Reports (as hereinafter defined) and (ii) the certificate of incorporation and bylaws or the equivalent organizational documents of each Subsidiary of the Company (the “Subsidiary Governing Documents”). The

Company Governing Documents and the Subsidiary Governing Documents are in full force and effect, and no other organizational documents are applicable to or binding upon the Company and its Subsidiaries. The Company and each of its Subsidiaries are in compliance with the terms of the Company Governing Documents and Subsidiary Governing Documents, as appropriate, except as, at the time of determination, does not and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

None of the execution and delivery of this Agreement by the Company, the performance by the Company of its obligations hereunder and the consummation by the Company of the transactions contemplated hereby will (i) conflict with or violate the Company Governing Documents or any Subsidiary Governing Documents or any resolution adopted by the shareholders of the Company or the board of directors or any committee of the board of directors of the Company or any Subsidiary of the Company; (ii) assuming that all Consents described in Section 4.4(b) have been obtained and, if required, the Company Shareholder Approval is received, conflict with or violate any federal, state, local, foreign or supranational law, common law, case law, statute, ordinance, code, rule, regulation, order, judgment, decree, stipulation, writ, injunction, award, permit or license (collectively, “Law”) applicable to the Company or any of its Subsidiaries, or by which any of them or any of their respective properties or assets may be bound or affected; or (iii) result in a violation or breach of or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in any loss of any benefit, or the creation of any Lien on any of the properties or assets of the Company or any of its Subsidiaries pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries or any of their respective properties or assets may be bound or affected (any of the foregoing referred to in clause (ii) above or this clause (iii) being a “Company

Violation”), other than, in the case of clause (ii) or clause (iii) above, any such Company Violations that, at the time of determination, does not and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

The Company has filed (or furnished, as applicable) with the SEC all forms, reports, schedules, registration statements, proxy statements, certifications and other documents required to be filed (or furnished, as applicable) by the Company or its directors and executive officers (in their capacity as such) with the SEC since January 1, 2007 (as they have been amended since the time of their filing, and including any documents filed as exhibits, annexes or schedules thereto, collectively, the “Company SEC Reports”) and complete and correct copies of all such Company SEC Reports are available to Parent through public sources. As of their respective dates, the Company SEC Reports (including any financial statements or schedules included or incorporated by reference therein) complied as to form in all material respects with the requirements of the Exchange Act or the Securities Act of 1933, as amended (and the rules and regulations of the SEC promulgated thereunder) (the “Securities Act”), applicable to such Company SEC Reports, and none of the Company SEC Reports so filed or furnished or that will be filed or furnished subsequent to the date of this Agreement contained or will contain, as of the date of filing and of any amendment or supplement and, in the case of any proxy statement, at the date mailed to shareholders and at the date of the meeting, any untrue statement of a material fact or omitted or will omit to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading. As of their respective dates, the financial statements (including all related notes and schedules) of the Company included in the

Company SEC Reports (i) have been (in the case of Company SEC Reports filed prior to the date hereof) or will be (in the case of Company SEC Reports filed after the date hereof) prepared from, are in accordance with, and accurately reflect the books and records of the Company and its consolidated Subsidiaries in all material respects, (ii) complied or will comply, as the case may be, in all material respects with all applicable accounting requirements and the published rules and regulations of the SEC with respect thereto, were or will be, as the case may be, prepared in accordance with United States generally accepted accounting principles (“GAAP”) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto), and (iii) fairly presented or will fairly present, as the case may be, in all material respects the consolidated financial position and the consolidated results of operations and cash flows of the Company and its consolidated Subsidiaries as of the dates or for the periods presented therein. The Company has heretofore furnished to Parent a complete and correct copy of any amendments or modifications which have not yet been filed with the SEC to agreements, documents or other instruments which previously had been filed by the Company with the SEC pursuant to the Securities Act or the Exchange Act. The Company has made available to Parent and Purchaser an interim unaudited balance sheet of the Company as at February 28, 2009 (the “Interim Financials Date”) and the related unaudited statement of operations for the two month period then ended (the “Interim Financial Statements”). The Interim Financial Statements have been prepared from, are in accordance with, and accurately reflect the books and records of the Company in all material respects, have been prepared in accordance with GAAP applied on a consistent basis during the periods involved (except for the absence of notes and recurring quarterly adjustments) and fairly present in all material respects the consolidated financial condition and consolidated results of operations of the Company and its consolidated Subsidiaries for the periods presented therein.

Since January 1, 2007, (i) neither the Company nor any of its Subsidiaries nor, to the Company’s knowledge, any director, officer, employee, auditor, accountant or representative of the Company or any of its Subsidiaries has received or otherwise had or obtained knowledge of any material complaint, allegation, assertion or claim, whether written or oral, regarding the accounting or auditing practices, procedures, methodologies or methods of the Company or any of its Subsidiaries or their respective internal accounting controls, including any complaint,

allegation, assertion or claim that the Company or any of its Subsidiaries has engaged in questionable accounting or auditing practices, and (ii) no attorney representing the Company or any of its Subsidiaries, whether or not employed by the Company or any of its Subsidiaries, has reported evidence of a violation of securities Laws, breach of fiduciary duty or similar violation by the Company, any of its Subsidiaries or any of their respective officers, directors, employees or agents to the Company Board or any committee thereof or to any director or officer of the Company.

The Company and its Subsidiaries have designed and maintained a system of internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) sufficient to provide reasonable assurances regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. The Company (i) has designed and maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) sufficient to ensure that material information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to the Company’s management as appropriate to allow timely decisions regarding required disclosure and to make the certifications required by the Exchange Act with respect to the Company SEC Reports and (ii) has disclosed to the Company’s auditors and the audit committee of the Company Board (and made summaries of such disclosures available to Parent) (A) any significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting that are reasonably likely to adversely affect in any material respect the Company’s ability to record, process, summarize and report financial information and (B) any fraud, whether or not material, that

involves management or other employees who have a significant role in the Company’s internal controls over financial reporting.

Except as set forth in the exhibit index of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and as permitted pursuant to Section 6.1, neither the Company nor any of its Subsidiaries is a party to or bound by (i) any agreement relating to the incurring or guarantee of Indebtedness by the Company or any of its Subsidiaries in an amount in excess of $1,000,000 in the aggregate, including any such agreement which contains provisions that restrict, or may restrict, the conduct of business of the issuer thereof as currently conducted (collectively, “Instruments of Indebtedness”); (ii) any “material contract” (as such term is defined in Item 601(b)(10) of Regulation S-K of the SEC); (iii) any agreement providing for the indemnification, in excess of $1,000,000, by the Company or a Subsidiary of the Company of any Person other than standard form indemnity provisions in agreements with customers of the Company or any of its Subsidiaries entered into in the ordinary course of business consistent with past practice; (iv) any material joint venture, partnership or similar agreement; (v) any agreement that grants any right of first refusal or right of first offer or similar right or that limits or purports to limit the ability of the Company or any of its Subsidiaries to own, operate, sell, transfer, pledge or otherwise dispose of any material assets or business; (vi) any contract or agreement providing for any payments that are conditioned, in whole or in part, on a change of control of the Company or any of its Subsidiaries, or that will have increased benefits, or accelerated vesting of benefits due to the consummation of the transactions contemplated hereby (including the Offer and the Merger); (vii) any collective bargaining agreement; (viii) any agreement material to the Company and its Subsidiaries, taken as a whole, pertaining to the acquisition, transfer, development, sharing, licensing or use of or granting any right to use or practice any rights under any Intellectual Property; (ix) any agreements pursuant to which the Company or any of its Subsidiaries leases or subleases any material real property from or to third parties; (x) any contract or agreement material to the Company and its Subsidiaries, taken as a whole, providing for the outsourcing or provision of servicing of customers, technology or product offerings of the Company or its Subsidiaries; (xi) any contract with a Material Customer or Material Supplier or that relates to the supply of any material item used by the Company or a Subsidiary by a sole source of supply; (xii) any contract that relates to the purchase, license, lease and/or maintenance of any computer software other than commercial off-the-shelf software available for an annual license fee of no more than $25,000; (xiii) any employment or consulting contract with any current executive officer of the Company or any Subsidiary of the Company or any member of the Company Board or the board of directors of any Company Subsidiary; or (xiv) any other contract or other agreement not made in the ordinary course of business consistent with past practice that (A) is not within any

of the other categories described in this Section 4.8(a) but is material to the Company and its Subsidiaries taken as a whole, (B) would reasonably be expected to result in revenues, receipts, liabilities or expenditures, or otherwise involve an amount, in excess of $5,000,000 per year or (C) would reasonably be expected to materially delay or prevent the consummation of the Offer, the Merger or any of the transactions contemplated by this Agreement (the agreements, contracts and obligations set forth in the exhibit index of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and the agreements, contracts and obligations listed in clauses (i) through (xiv) being referred to herein as “Company Material Contracts”). Section 4.8(a) of the Company Disclosure Schedule sets forth as of the date hereof all of the Company Material Contracts. True, correct and complete copies of each Company Material Contract have been made available to Parent.

There are no provisions in any Instrument of Indebtedness that provide any restrictions on the repayment of the outstanding Indebtedness thereunder, or that require that any financial payment (other than payment of outstanding principal and accrued interest) be made in the event of the repayment of the outstanding Indebtedness thereunder prior to expiration. “Indebtedness” means, with respect to any Person, all obligations (including all obligations in respect of principal, accrued interest, penalties, prepayment penalties, fees and premiums) of such Person (i) for borrowed money (including overdraft facilities), (ii) evidenced by notes, bonds, debentures or similar instruments, (iii) for the deferred purchase price of property, goods or services (other than trade payables or accruals incurred in the ordinary course of business), (iv) under capital leases (in accordance with GAAP), (v) in respect of letters of credit and bankers’ acceptances, (vi) under interest rate or currency swap or other derivative or hedging instruments and transactions (valued at the termination value thereof), (vii) secured by any Lien on property or assets owned by such Person, whether or not the obligations secured

thereby have been assumed, (viii) all obligations of such Person under any sale and lease back transaction, agreement to repurchase securities sold or other similar financing transaction and (ix) in the nature of guarantees of the obligations described in clauses (i) through (viii) above of any other Person.

Section 4.11 of the Company Disclosure Schedule lists all employee benefit plans (within the meaning of Section 3(3) of ERISA), and other similar funds, policies, arrangements, practices and programs, including individual agreements and foreign benefit plans not subject to ERISA (individually, a “Benefit Plan,” and collectively, the “Benefit Plans”), which are established, contributed to or maintained by the Company and/or one or more of its Benefits Affiliates (as defined in the following sentence) for the benefit of any of the current or former employees, consultants or directors of the Company. The term “Benefits Affiliates” shall mean (i) any corporation which is a member of a controlled group of corporations (as defined in Section 414(b) of the Code), which includes the Company, (ii) any trade or business (whether or not incorporated) that is under common control (as defined is Section 414(c) of the Code) with the Company, (iii) any organization (whether or not incorporated) that is a member of an affiliated service group (as defined in Section 414(m) of the Code), which

includes the Company and (iv) any other entity required to be aggregated with the Company pursuant to the regulations issued under Section 414(o) of the Code.

Each Benefit Plan that is a “nonqualified deferred compensation plan” (as defined in Section 409A(d)(1) of the Code) has been operated in compliance with Section 409A of the Code and applicable IRS guidance, and no amounts payable with

To the Company’s knowledge, it is not, nor has it been, engaged in any unfair labor practice within the past four (4) years. There is not now, nor has there been within the past four (4) years, any unfair labor practice complaint against the Company pending or, to the Company’s knowledge, threatened, before the National Labor Relations Board or any other comparable foreign or domestic authority or any workers’ council, except as, at the time of determination, does

not and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Set forth on Section 4.13(b) of the Company Disclosure Schedule is a list of (i) all material agreements under which the Company or any of its Subsidiaries licenses from a third party Intellectual Property that is used by the Company or such Subsidiary in the conduct of its business, except for off-the-shelf software programs that the Company and any of its Subsidiaries use in the ordinary course

of business, and (ii) all agreements under which the Company or any of its Subsidiaries licenses from a third party Intellectual Property that would be infringed by the Company’s operations or manufacture, distribution, sale, importation or use of the products of the Company or any of its Subsidiaries, or any components of such products, absent such license (collectively, such agreements being referred to as “License-In Agreements”). The Company has delivered to Parent correct and complete copies of all License-In Agreements. To the knowledge of the Company, (i) each License-In Agreement is valid, binding, and in full force and effect; (ii) each License-In Agreement will continue to be valid, binding, and in full force and effect on identical terms following the consummation of the transactions contemplated hereby; (iii) neither the Company nor any of its Subsidiaries is in default of any such License-In Agreement, and no event has occurred that with notice or lapse of time would constitute a default or permit termination, modification, or acceleration thereunder; (iv) neither the Company nor any of its Subsidiaries has repudiated any provision of any License-In Agreement; and (v) neither the Company nor any of its Subsidiaries has granted any sublicense or similar right with respect to any License-In Agreement, except, in the case of each of clauses (iii) and (iv) for any of the foregoing that, at the time of determination, does not and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

None of (i) the Company or any of its Subsidiaries, (ii) the Intellectual Property owned by the Company or any of its Subsidiaries, or (iii) the operation of the business of the Company or any of its Subsidiaries interferes or has interfered with, infringes or has infringed upon, misappropriates or has misappropriated, or otherwise has come into conflict with any Intellectual Property rights of third parties, and neither the Company nor any of its Subsidiaries has received any written charge, complaint, claim, demand, or notice during the past three (3) years, (or earlier, if not resolved) alleging any such interference, infringement, misappropriation, or violation (including any claim that the Company or any of its Subsidiaries must license or refrain from using any Intellectual Property rights of any third party). To the knowledge of the Company, no third party has interfered

with, infringed upon, misappropriated, or otherwise come into conflict with any Intellectual Property rights of the Company or any of its Subsidiaries during the past two (2) years (or earlier if not resolved), excluding any such interference, infringement or misappropriation that, at the time of determination, does not and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

The Information Systems of the Company and its Subsidiaries are adequate for the operation of their respective businesses as presently conducted, and none of such Information Systems depend upon any Information System of any other Person. The Company uses reasonable means to protect the security and integrity of all such Information Systems. The Company’s use of any Information Systems does not exceed the scope of the rights granted to the Company with respect thereto, including any applicable limitation upon the usage, type and/or number of

licenses, users, hardware, time, services or systems. There has not been any material malfunction with respect to any of the material Information Systems of the Company since January 1, 2007 that has not been remedied or replaced in all material respects.

The Company and each of the Subsidiaries have withheld and paid all Taxes required to be withheld and paid in connection with amounts paid and owing to any employee, independent contractor, creditor, stockholder or other third party

(whether domestic or foreign). None of the Company or any Subsidiary has been informed by any jurisdiction that the jurisdiction believes that the Company or any of its Subsidiaries was required to file any Tax Return that was not filed. Neither the Company nor any of its Subsidiaries will be required to include any material item of income in, or exclude a material item of deduction from, taxable income for any taxable period ending after the Effective Time, as a result of any (A) change in method of accounting for a prior taxable period under Code Section 481(c) (or any corresponding or similar provision under state, local, or foreign tax law), (B) written and legally binding agreement with a taxing authority relating to taxes, (C) installment sale or open transaction disposition or intercompany transaction made on or prior to the Effective Time, (D) prepaid amount received on or prior to the Effective Time, or (E) deferred intercompany gain or excess loss account described in Treasury regulations promulgated under Section 1502 of the Code (or any corresponding or similar provisions under state, local or foreign tax law).

None of the assets of the Company or any of its Subsidiaries: (i) is property that is required to be treated as being owned by any other person pursuant to the provisions of former Section 168(f)(8) of the Internal Revenue Code of 1954; or

(ii) is “tax-exempt use property” within the meaning of Section 168(h) of the Code.

None of the execution and delivery of this Agreement by Parent or the Purchaser, the performance by Parent or the Purchaser of their respective obligations hereunder and the consummation by Parent and the Purchaser of the transactions contemplated hereby will (i) conflict with or violate their respective certificates or articles of incorporation and bylaws or similar organizational documents (provided that the Purchaser’s certificate of incorporation shall be amended prior to the Effective Time to increase the Purchaser’s authorized share capital in order to facilitate the treatment of Company Stock Options set forth in Section 2.9), (ii) assuming that all Consents described in Section 5.3(b) have been made or obtained, conflict with or violate any Law applicable to Parent or the Purchaser, or by which any of them or any of their respective properties or assets may be bound or affected, or (iii) result in a violation or breach of or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in any loss of any benefit, or the creation of any Lien on any of the properties or assets of Parent or the Purchaser (any of the foregoing referred to in clause (ii) or clause (iii) above being a “Parent Violation”) pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which Parent or the Purchaser is a party or by which Parent or the Purchaser or any of their respective properties or assets may be bound or affected, other than, in the case of clause (ii)

or clause (iii) above, any such Parent Violations that would not reasonably be expected to prevent or materially delay the consummation of the Offer or the Merger.

(A) terminate, modify, renew or waive any material provision of any Company Material Contract other than normal renewals of such Company Material Contracts without materially adverse changes, additions or deletions of terms or (B) enter into or renew any agreement, contract, lease, license or other binding obligation of the Company or its Subsidiaries (i) containing (1) any limitation or restriction on the ability of the Company or its Subsidiaries or, following completion of the transactions contemplated hereby, the ability of Parent or its Subsidiaries, to engage in any type of activity or business, (2) any limitation or restriction on the manner in which, or the localities in which, all or any portion of the business of the Company or its Subsidiaries or, following consummation of the transactions contemplated hereby, all or any portion of the business of Parent or its Subsidiaries, is or would be conducted or (3) any limit or restriction on the ability of the Company or its Subsidiaries or, following completion of the transactions contemplated hereby, the ability of Parent or its Subsidiaries, to solicit customers or employees, (ii) that would reasonably be expected to materially delay or

prevent the consummation of the Merger or any of the transactions contemplated by this Agreement, (iii) that involves or would reasonably be expected to involve payments in excess of $500,000 annually or $1,000,000 in the aggregate over the term of the contract and that is not terminable within thirty (30) days of the Effective Time without payment by Parent or its Subsidiaries or (iv) that, if effective as of the date hereof, would have been listed on Section 4.8(a) of the Company Disclosure Schedule as a Company Material Contract;

incur any capital expenditures or enter into any agreement obligating the Company or its Subsidiaries to provide for future capital expenditures,

except in a manner substantially consistent with the capital expenditures budgeted for in the 2009 Budget previously made available to Parent;

The Company agrees that neither the Company nor any of its Subsidiaries shall, and that the Company shall cause its and its Subsidiaries’ respective directors, officers, employees, agents and representatives (including any investment banker, attorney or accountant retained by the Company or any of its Subsidiaries) not to, directly or indirectly, (i) initiate, solicit or encourage, or take any other action to facilitate, any inquiries or the making of any proposal or offer with respect to, or a transaction to effect, a Takeover Proposal, (ii) have any discussion with or

provide any information or data to any Person relating to a Takeover Proposal or engage in any negotiations concerning a Takeover Proposal (except solely to inform a Person who has made an unsolicited request or approach of the existence of this Section 6.2), (iii) make or authorize any statement, recommendation or solicitation in support of any Takeover Proposal, (iv) enter into any letter of intent, arrangement, understanding or agreement regarding any Takeover Proposal or (v) terminate, amend or waive any rights under any confidentiality, “standstill,” nonsolicitation or similar agreement with any third party to which any of the Company or any of its Subsidiaries is or was a party or under which any of the Company or any of its Subsidiaries has or had any rights, except to the extent such “standstill,” nonsoliciations or similar agreements are automatically terminated as the result of the execution or announcement of this Agreement.

Notwithstanding anything in subsection (a) or (c) to the contrary, if and only to the extent that (A) prior to the acceptance for payment of Company Shares pursuant to the Offer (and in no event after such time), (B) a Takeover Proposal that the Company Board determines in good faith to be bona fide has been received by the Company and not withdrawn, (C) the Company Board determines in good faith, after consultation with ▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC or another nationally recognized financial adviser and outside legal counsel, that such Takeover Proposal constitutes or would reasonably be expected to lead to a Superior Proposal, and the failure to do so would be reasonably likely to constitute a failure to comply with its fiduciary duties to the Company’s shareholders under applicable Law, and (D) such Takeover Proposal did not arise from a breach of Section 6.2(a) and none of the Company or any of its

Subsidiaries or any of their respective directors, officers, employees, agents and representatives has breached Section 6.2(a) (other than immaterial breaches that did not lead to, directly or indirectly, the making of such Takeover Proposal), then the Company shall be permitted to (x) if it provides prior written notice to Parent of its decision to take such action not less than twenty-four (24) hours prior to taking such action, (1) furnish information with respect to the Company and any of its Subsidiaries to such Person (but only to the extent such information has previously been provided to Parent) pursuant to a confidentiality and standstill agreement having terms at least as favorable to the Company as the Confidentiality Agreement (which agreement shall be provided to Parent prior to furnishing any information to such Person), and (2) participate in discussions with such Person regarding such Takeover Proposal, and (y) if the Company Board determines after consulting with ▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC or another nationally recognized financial advisor and outside legal counsel that such Takeover Proposal is a Superior Proposal, and failure to do so would be reasonably likely to constitute a failure to comply with its fiduciary duties to the Company’s shareholders under applicable Law, effect a Change in the Company Recommendation (as hereinafter defined); provided, however, that, without limiting the last sentence of Section 6.2(e), the Company shall not effect a Change in the Company Recommendation unless and until (1) the Company shall have provided the Purchaser and Parent written notice at least five (5) Business Days prior to taking such action to the effect that the Company Board has authorized and intends to effect a Change in the Company Recommendation pursuant to this Section 6.2(b)(y), attaching the most current version of any proposed agreement, a detailed summary of the material terms of any such proposal and the identity of the offeror, (2) the Company shall have, during the five (5) Business Day period referred to in clause (1) above (the “Match Period”), negotiated with Parent and the Purchaser in good faith (but only if such negotiations are requested by Parent) to make such adjustments in the terms and conditions of this Agreement so that the Superior Proposal ceases to constitute a Superior Proposal, and (3) the Company Board shall have determined, in good faith and after consultation with its outside legal counsel and ▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC or another nationally recognized financial advisor, that the Takeover Proposal constituting such Superior Proposal continues to constitute a Superior Proposal at the end of the Match Period.

In addition to the obligations of the Company set forth in the other provisions of this Section 6.2, the Company shall as promptly as practicable upon receipt of a Takeover Proposal or any request for information or any discussions or inquiry which is reasonably likely to lead to a Takeover Proposal (and in any event within two (2) Business Days) provide to Parent a summary of all material terms and conditions of any such inquiry, request for information or Takeover Proposal (or indication by any Person that it is considering a Takeover Proposal). The Company will keep Parent promptly informed (and in any event within one (1) Business Day after the occurrence of any material changes, developments, negotiations or discussions) of the status and details (including amendments or proposed amendments) of any such request or Takeover Proposal or inquiry and shall promptly provide to Parent a copy of any non-public information furnished

to the Person who made such request or Takeover Proposal or inquiry that was not previously provided to Parent. The Company acknowledges and agrees that each successive amendment or revision to any Takeover Proposal or Superior Proposal (other than immaterial amendments or revisions to terms or provisions that do not affect purchase price, timing or risks of non-consummation) shall constitute a new Takeover Proposal for purposes of this Agreement (provided that the Company shall not be required to enter into a new confidentiality agreement with respect to such an amended Takeover Proposal if the Company already has such a confidentiality agreement in compliance with Section 6.2(b) with the party making such amended Takeover Proposal).

Upon the terms and subject to the conditions set forth in this Agreement, each of the parties hereto shall, and shall cause each of its Subsidiaries to, use its reasonable best efforts (subject to, and in accordance with, applicable Law) to promptly take, or cause to be taken, all actions, and to promptly do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable under applicable Laws to consummate the Offer, and to consummate and make effective the Merger and the other transactions contemplated by this Agreement as soon as practicable, including (i) cooperation in the preparation and filing of the Offer Documents, the Schedule 14D-9 and any actions or filings related thereto, (ii) obtaining all necessary actions or non-actions, waivers, consents, clearances and approvals from Governmental Entities required to be obtained by such party and the making of all necessary registrations and filings and the taking of all steps as may be necessary for such party to obtain an approval, clearance or waiver from, or to avoid an action or proceeding by, any Governmental Entity, (iii) obtaining all consents, approvals or waivers from third parties, (iv) defending any lawsuits or other legal proceedings, whether judicial or administrative, commenced against such party challenging this Agreement or the consummation of the Offer, the Merger or the other transactions contemplated by this Agreement, (v) publicly supporting this Agreement, the Offer, the Merger and the other transactions contemplated by this Agreement, (vi) satisfying the Tender Offer Conditions and the conditions to the consummation of the Merger set forth in Article Seven and (vii) executing and delivering any additional instruments necessary to consummate the transactions contemplated by, and to fully carry out the purposes of, this Agreement; provided, however, that the foregoing provisions of this Section 6.4(a) shall not require the Company to perform, satisfy or

discharge any obligations of Parent or Purchaser under this Agreement or otherwise, or the Parent or Purchaser to perform, satisfy or discharge any obligations of the Company under this Agreement or otherwise. In addition, if at any time prior to the Effective Time any event or circumstance relating to either the Company, Parent, the Purchaser or any of their respective Subsidiaries should be discovered by the Company or Parent, as the case may be, which should be set forth in an amendment to the Offer Documents or Schedule 14D-9, the discovering party will promptly inform the other party of such event or circumstance. In connection with the consents, approvals and waivers referred to in clause (iii) above, (x) the Company shall keep Parent informed of all material developments in seeking such consents, approvals or waivers and shall, at Parent’s request, include Parent in any discussions or communications with any parties whose consent, waiver or approval is sought; (y) such consents, approvals and waivers shall be in a form acceptable to Parent; and (z) in the event the Offer is not consummated or the Merger does not close for any reason, neither Parent nor the Purchaser shall have any liability to the Company, its shareholders or any other Person for any costs, claims, liabilities or damages resulting from the Company seeking to obtain such consents, approvals and waivers.

Parent and the Company shall (i) promptly notify the other party of any communication to that party from any Governmental Entity in respect of any filing, investigation or inquiry concerning this Agreement or the transactions contemplated hereby; (ii) if practicable, permit the other party the opportunity to review in advance all the information relating to Parent or the Company, as the case may be, that appears in any filing made with, or written materials submitted to, any third party and/or any Governmental Entity in connection with the

transactions contemplated by this Agreement and incorporate the other party’s reasonable comments; (iii) not participate in any substantive meeting or discussion with any Governmental Entity in respect of any filing, investigation, or inquiry concerning this Agreement or the transactions contemplated herein unless such party consults with the other party in advance, and, to the extent permitted by such Governmental Entity, gives the other party the opportunity to attend; and (iv) furnish the other party with copies of all correspondence, filings, and written communications between them and their Subsidiaries and representatives, on the one hand, and any Governmental Entity or its respective staff, on the other hand, with respect to this Agreement and the transactions contemplated hereby, except that any materials concerning valuation of the transaction or internal financial information may be redacted.

From and after the acceptance for payment of Company Shares pursuant to the Offer, the Company and the Surviving Corporation will indemnify and hold harmless each present and former director and officer of the Company (the

“Indemnified Parties”), against any costs or expenses (including attorneys’ fees), judgments, fines, losses, claims, damages or liabilities incurred in connection with any claim, action, suit, proceeding or investigation, whether civil, criminal, administrative or investigative, by reason of the fact that such individual is or was a director or officer of the Company, or is or was serving at the request of the Company or any of its Subsidiaries as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, in respect of actions or omissions occurring at or prior to the Expiration Date in such Indemnified Party’s capacity as a director or officer of the Company or such other corporation, partnership, joint venture, trust or other enterprise, as applicable, to the fullest extent permitted under the articles of incorporation and bylaws of the Company as of the date hereof, and shall advance fees and expenses (including attorneys’ fees) as incurred to the fullest extent permitted under the articles of incorporation and bylaws of the Company as of the date hereof.

From and after the Effective Time, the Surviving Corporation shall purchase and maintain a six-year extended reporting period endorsement under the Company’s current directors’ and officers’ liability insurance coverage covering acts or omissions occurring prior to the Effective Time with respect to those Company officers and directors who are currently covered by the Company’s directors’ and officers’ liability insurance policy on terms with respect to such coverage and amount no less favorable to the Company’s directors and officers currently covered by such insurance than those of such policy in effect on the date hereof; provided, however, that in no event shall the Surviving Corporation be required to pay aggregate premiums for insurance under this Section 6.6(c) in excess of $550,000 for such purpose and, if the premiums for such insurance coverage exceed such amount, the Surviving Corporation shall use its reasonable best

efforts obtain a policy with the greatest coverage available for a cost not exceeding such amount.

Parent shall, or shall cause the Surviving Corporation to, provide Company Employees whose employment terminates on or prior to December 31, 2009 with severance benefits in an amount that is equal to the severance benefits that such Company Employee would have been entitled to pursuant to, and under circumstances consistent with, the terms of the Company’s severance plan as in effect as of February 11, 2009; provided, however, that Parent may, or may cause the Surviving Corporation, to take such action as Parent may deem necessary or

desirable in order to (i) cause the amount of severance benefits payable to any Company Employee to be reduced by an amount to which such Company Employee may be entitled to receive from Parent or the Surviving Corporation under the Worker Adjustment and Retraining Notification Act of 1988, as amended, and the rules and regulations promulgated thereunder, and (ii) condition the right of any Company Employee to receive any severance benefit upon the agreement of such Company Employee on the cancellation and termination of all of such Company Employee’s Company Stock Options without the payment or delivery of any other payment or consideration in exchange therefore or in respect thereof.

by the Company if Purchaser fails to commence the Offer on or prior to April 27, 2009; provided, however, that any such termination, if any, must occur within five (5) Business Days after such date and, provided further, the Company may not

terminate this Agreement pursuant to this Section 8.1(b) (i) after the Purchaser commences the Offer or (ii) if the Purchaser’s failure to commence the Offer is due to the Company’s material breach of this Agreement;

by Parent, prior to the acceptance for payment of Company Shares pursuant to the Offer, if (i) a Change in the Company Recommendation shall have occurred, (ii) the Company Board shall have approved or recommended, or entered into any agreement (other than a confidentiality agreement as permitted pursuant to Section 6.2(b)) with respect to, a Takeover Proposal, or failed to recommend against a Takeover Proposal by the earliest of the date that is ten (10) Business Days thereafter, the End Date and the Expiration Date (taking into account any extensions thereof described in Section 1.1(b)), or taken any action to exempt a Takeover Proposal from any Takeover Law or the Rights, (iii) the Company, any of its Subsidiaries or any of their respective directors, officers, employees, agents or representatives shall have breached Section 6.2 in any material respect, (iv) the

Company Board shall have adopted a resolution, or publicly proposed, to effect any of the foregoing, (v) a Takeover Proposal shall have been publicly announced and the Company Board shall not have, by the earliest of the date that is ten (10) Business Days thereafter, the End Date and the Expiration Date (taking into account any extensions thereof described in Section 1.1(b)), rejected such Takeover Proposal and reaffirmed the Company Recommendation and its support for the transactions contemplated by this Agreement, or (vi) the Company Board shall have refused to affirm the Company Recommendation within five Business Days of any reasonable written request from Parent.

by Parent, prior to the acceptance for payment of Company Shares pursuant to the Offer, if there occurs any change, event or development that, individually or in the aggregate with all other changes, events and developments occurring since the date of this Agreement, has had or would reasonably be expected to have a Material Adverse Effect which is not, or cannot be, cured by the earliest of the date that is thirty (30) days after written notice thereof is provided by Parent to the

Company, the End Date and the Expiration Date (taking into account any extensions thereof described in Section 1.1(b).

In the event that this Agreement is terminated by the Company pursuant to Section 8.1(g) due to a breach by Parent or the Purchaser, then Parent shall promptly pay to the Company, in cash by wire transfer to an account designated by the Company, an amount equal to Two Million Dollars ($2,000,000) (the “Parent Termination Fee”), and in any such case neither Parent nor the Purchaser shall have any further liability with respect to this Agreement or the transactions contemplated hereby. Concurrently with the execution of this Agreement the

Company, Parent, the Purchaser and Comerica Bank (the “Escrow Agent”) shall enter into an Escrow Agreement in substantially the form attached hereto as Exhibit B (the “Escrow Agreement”), and Parent shall deposit with the Escrow Agent Two Million Dollars ($2,000,000) (such amount, together with any interest and other returns earned thereon, the “Deposit”) by wire transfer of immediately available funds. The Escrow Agent shall deposit the Deposit into an interest bearing account (the “Deposit Account”) as set forth in the Escrow Agreement. If the Purchaser shall have accepted for payment Company Shares pursuant to the Offer, the Deposit shall be applied at the direction of the Purchaser to payment for such Company Shares. If this Agreement is terminated under circumstances under which the Company is entitled to receive the Parent Termination Fee pursuant to this Section 8.3(c), then (i) the Deposit shall be applied to the payment of the Parent Termination Fee in accordance with the terms of the Escrow Agreement, and (ii) Parent shall be entitled to receive and retain any amount of the Deposit which is in excess of the Parent Termination Fee. If this Agreement is terminated otherwise than under circumstances under which the Company is entitled to receive the Parent Termination Fee pursuant to this Section 8.3(c), Parent shall be entitled to receive and retain the Deposit.

If to Parent or the Purchaser:

with a copy to:

and to:

If to the Company:

with a copy to:

“Employment Agreement” means a contract, offer letter or agreement of the Company or any of its Subsidiaries with or addressed to any individual who is

rendering, will render or has rendered services thereto as an employee or consultant pursuant to which the Company or any of its Subsidiaries has any actual or contingent liability or obligation to provide compensation and/or benefits in consideration for past, present or future services, other than any non-binding offer letter that recites benefits, salary, equity grants and employee benefits.

“Intellectual Property” means (i) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto, and all patents, patent applications, and patent disclosures, together with all provisionals, reissuances, continuations, continuations-in-part, divisions, revisions, extensions, and reexaminations thereof, (ii) all trademarks, service marks, trade dress, logos, brand names, trade names, domain names and uniform resource locators associated therewith, and corporate names, together with all translations, adaptations, derivations, and combinations thereof and including all goodwill associated therewith, and all applications, registrations, and renewals in connection therewith, (iii) all copyrightable works, all copyrights, any and all website content, and all applications, registrations, and renewals in connection therewith, (iv) all mask works and all applications, registrations, and renewals in connection therewith, (v) all trade secrets and confidential business information (including research and development, know-how, formulas, compositions, manufacturing and production processes and techniques, technical data, designs, drawings, specifications, research records, records of inventions, test information, customer and supplier lists, pricing and cost information, and business and marketing plans and proposals), (vi) all source code and object code versions of computer software (including data and related documentation), (vii) all moral rights, (viii) all other proprietary rights, and (ix) all copies and tangible embodiments thereof (in whatever form or medium), any rights in or licenses of any of the foregoing, and any claims or causes of actions (pending or filed)

arising out of or related to any infringement or misappropriation of any of the foregoing.

“Open Source Software” means any software that is generally available to the public in source code form under licenses substantially similar to those approved

by the Open Source Initiative, which licenses include the GNU General Public License, the GNU Lesser Public License and the Mozilla Public License.

Term

Section

1998 Plan

Acceptance Date

Term

Section

Agreement

Arrangements

Articles of Merger

Benefit Plans

Benefits Affiliates

Book-Entry Shares

Board Recommendation

Certificates

Change in the Company Recommendation

Closing

Closing Date

Common Shares

Company

Company Balance Sheet

Company Board

Company Director

Company Employees

Company Governing Documents

Company Material Contracts

Company SEC Reports

Company Shareholder Approval

Company Shares

Company Violation

Confidentiality Agreement

Consent

Covered Securityholders

Director Option Consideration

Director Options Plan

Director Stock Option

Dissenting Shares

Effective Time

Employee Benefit Arrangement

End Date

Exchange Act

Exchange Fund

Expiration Date

Export Approvals

Export Control Laws

FCPA

Foreign Benefit Plan

GAAP

Governmental Entity

HSR Act

Indebtedness

Term

Section

Indemnified Parties

Instruments of Indebtedness

Intellectual Property

Interim Financials Date

Interim Financial Statements

IRS

Law

Leased Real Property

License-In Agreements

Match Period

Material Customers

Material Suppliers

Merger

Merger Price

NASDAQ

New Plans

OBCA

Offer

Offer Documents

Offer Price

Other Filings

Parent

Parent Representatives

Parent Termination Fee

Parent Violation

Paying Agent

Proxy Statement

Purchaser

Parent Board

Purchaser Board

Real Property Leases

▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002

Schedule 14D-9

Securities Act

SEC

Special Meeting

Superior Proposal

Support Agreement

Surviving Corporation

Takeover Laws

Takeover Proposal

Tax

Tax Return

Tender Offer Conditions

Term

Section

Termination Fee

Top-Up Option

Top-Up Option Shares

Voting Debt

Welfare Plan

Each of the parties hereby agrees that all actions or proceedings arising out of or in connection with this Agreement or the transactions contemplated hereby (including the Offer and the Merger) or for recognition and enforcement of any judgment arising out of or in connection with this Agreement or the transactions contemplated hereby (including the Offer and the Merger), shall be tried and determined exclusively in the Delaware Court of Chancery, or in the event (but only in the event) that such court does not have subject matter jurisdiction over such proceeding, in the United States District Court for the District of Delaware, and each of the parties hereby irrevocably submits with regard to any such action or proceeding for itself and with respect to its property, generally and unconditionally, to the exclusive jurisdiction of the aforesaid courts. Each of the parties hereby expressly waives any right it may have to assert, and agrees not to assert, by way of motion, as a defense, counterclaim or otherwise, in any such action or proceeding: (i) any claim that it is not subject to personal jurisdiction in

the aforesaid courts for any reason; (ii) that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts; and (iii) that (A) any of the aforesaid courts is an inconvenient or inappropriate forum for such action or proceeding, (B) venue is not proper in any of the aforesaid courts and (C) this Agreement, the transactions contemplated hereby (including the Offer and the Merger) or the subject matter hereof or thereof, may not be enforced in or by any of the aforesaid courts.