EXABYTE SHARE PURCHASE AGREEMENT

     This**Share Purchase Agreement**(this "Agreement"), is made and entered into as of April 12, 2001, by and among Exabyte Corporation, a Delaware corporation (the"Company"), and State of Wisconsin Investment Board ("Purchaser").

1.     Authorization of Sale of the Shares

     Subject to the terms and conditions of this Agreement, the Company has authorized the sale of up to One Million Five Hundred (1,500,000) shares (the "Shares") of Series G Preferred Stock, parvalue $0.001 per share (the "Preferred Stock"), of the Company.

     The Preferred Stock will accrue dividends, payable as required by Section 2(d) of the Certificate of Designation (defined below) in cash or issuable in shares (the"Dividend Shares") of Common Stock, $.001 par value per share ("Common Stock"), at a compound annual rate of 9% and be convertible, at the holder's option, into shares of Common Stock (the "Conversion Shares") at a conversion price of $2.40 per share, asadjusted pursuant to the terms of the Preferred Stock (the "Conversion Price"). The rights, preferences and privileges of the Preferred Stock are set forth in a Certificate of Designation, in the form of Exhibit D attached hereto (the "Certificate of Designation").

2.     Agreement to Sell and Purchase the Shares

     2.1     Purchase and Sale

     Subject to the terms and conditions of this Agreement, the Purchaser agrees to purchase, and the Company agrees to sell and issue to the Purchaser, at the Closing (as defined below) the Shares.

     2.2     Purchase Price

     The purchase price of each Share (the "Per Share Price") shall be $2.00. Other than in a Permitted Issuance, the Company will not, for ninety (90) days after the Closing Date (as defined below),sell Common Stock at a price per share of less than $2.40 per share, or (ii) options, warrants or any other securities that can be converted into, or otherwise exchanged for, shares of the Company's Common Stock at a conversion or exercise price per shareless than $2.40. Except in a Permitted Issuance, in the event the Company shall, during the period beginning on the date of this Agreement and ending ninety (90) days after the Closing Date, sell any shares of the Company's Common Stock at, or anyinstruments that can be converted into or otherwise exchanged for the Company's Common Stock (the "Subsequent Sale") exercisable or convertible at, a price per share (the "Subsequent Purchase Price") of less than $2.40 per share, appropriately adjustedfor any stock splits, stock combinations, stock dividends or other similar transactions affecting the Common Stock, the Company shall, within ten (10) business days of the Subsequent Sale, pay to the Purchaser an amount in cash equal to the number ofConversion Shares then issuable times the difference between $2.40 and the Subsequent Purchase Price. The Per Share Price and Conversion Price of the Shares shall remain as $2.00 and $2.40, respectively. For purposes of this Section 2.2 a "PermittedIssuance" shall mean any issuance of securities by the Company in connection with a merger, sale of all or substantially all of the assets of the Company, exchange offer or tender offer for outstanding securities of the Company or other business combination .

3.      Delivery of the Shares at the Closing

     (a)      The completion of the purchase and sale of the Shares (the "Closing") shall occur at the offices of Holland & Hart LLP, counsel to the Company, at 1050Walnut Street, Boulder, Colorado 80302 at 9:00 a.m. local time on April 16, 2001 or such other time and date as may be agreed by the parties (the "Closing Date").

     (b)      At the Closing, the Company shall issue to the Purchaser one or more stock certificates registered in the name of such Purchaser, or insuch nominee name(s) as designated by Purchaser in writing, representing the Shares and bearing an appropriate legend referring to the fact that the Shares were sold in reliance upon the exemption from registration provided by Section 4(2) of theSecurities Act of 1933, as amended (the "Securities Act"), and Rule 506 under the Securities Act. The Company will deliver one certificate representing 80% of the Shares and another certificate representing 20% of the Shares (the "Certificates") againstdelivery of payment for the Shares by the Purchaser. Prior to the Purchaser's delivery of payment for the Shares, the Company will deliver via facsimile a copy of the Certificates to be delivered upon Closing to the office of the Purchaser (at the faxnumber indicated on the signature pages attached hereto).

     (c)      The Company's obligation to complete the purchase and sale of the Shares shall be subject to the following conditions, any one or moreof which may be waived by the Company:

          (i)      receipt by the Company from stockholders holding rights to require the Company to register the sale ofany securities owned by such holder in the Registration Statement (as defined below) of waivers of such rights (including the waiver of any notice requirements related to such rights);

          (ii)      receipt by the Company of same-day funds in the full amount of the purchase price for the Shares beingpurchased under this Agreement; and

          (iii)      the accuracy in all material respects of the representations and warranties made by the Purchaser andthe fulfillment in all material respects of those undertakings of the Purchaser to be fulfilled before the Closing.

     (d)      The Purchaser's obligations to accept delivery of such stock certificates and to pay for the Shares evidenced by the Certificates shallbe subject to the following conditions, any one or more of which may be waived by the Purchaser:

          (i)      the representations and warranties made by the Company in this Agreement shall be accurate in allmaterial respects and the undertakings of the Company required by their respective terms to be completed prior to Closing shall have been fulfilled in all material respects on or before the Closing;

          (ii)      the Company shall have delivered to the Purchaser a certificate executed by the chairman of the board orpresident and the chief financial or accounting officer of the Company, dated the Closing Date, in form and substance reasonably satisfactory to the Purchaser, to the effect that the representations and warranties of the Company set forth in Section 4hereof are true and correct in all material respects as of the date of this Agreement and as of the Closing Date, and that the Company has complied with all the agreements and satisfied all the conditions in this Agreement on its part to be performed orsatisfied on or before the Closing Date; and

          (iii)      the Company shall have delivered to Purchaser a legal opinion in substantially the form attached heretoas Exhibit A.

4.      Representations, Warranties and Covenants of the Company

     Except as disclosed in the Company Documents (defined below), the Company hereby represents and warrants to the Purchaser as follows as of the date of this Agreement andthe Closing Date (which representations and warranties shall be deemed to apply, where appropriate, to each subsidiary of the Company): 

     4.1     Organization and Qualification

     The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware. The Company has the corporate power and authority toown, lease and operate its properties and to conduct its business as currently conducted and to enter into and perform its obligations under this Agreement. The Company is duly qualified as a foreign corporation to transact business and is in goodstanding in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify would not, singly or in the aggregate, have a materialadverse effect on the condition, financial or otherwise, or the earnings, assets, business affairs or business prospects of the Company. 

     4.2     Capitalization, As of March 31, 2001, 

          (a)      the authorized capital stock of the Company consists of 50,000,000 shares of Common Stock and 14,000,000shares of Preferred Stock.

          (b)      the issued and outstanding capital stock of the Company consists of 23,232,465 shares of Common Stock.The shares of issued and outstanding capital stock of the Company have been duly authorized and validly issued, are fully paid and nonassessable and have not been issued in violation of or are not otherwise subject to any preemptive or other similar rights. 

          (c)      the Company has reserved 10,584,713 shares of Common Stock for issuance upon the exercise of stockoptions granted or available for future grant under the Company's stock option plans. 

          (d)      the Company has reserved 304,248 shares of Common Stock for issuance pursuant to the Company's stockpurchase plan. 

          (e)      the Company has reserved 150,000 shares of Common Stock for issuance upon the exercise of outstandingwarrants to purchase Common Stock.

     With the exception of the foregoing, there are no outstanding subscriptions, options, warrants, convertible or exchangeable securities or other rights granted to or bythe Company to purchase shares of Common Stock or other securities of the Company and there are no commitments, plans or arrangements to issue any shares of Common Stock or any security convertible into or exchangeable for Common Stock.

     4.3     Issuance, Sale and Delivery of the Shares, Conversion Shares and Dividend Shares

          (a)      The Shares, Conversion Shares and Dividend Shares (collectively, the "Securities") have been duly authorized for issuance and saleto the Purchaser pursuant to this Agreement and, when issued and delivered by the Company with respect to the Shares pursuant to this Agreement against payment of the consideration set forth in this Agreement, or with respect to the Conversion Shares orDividend Shares in accordance with the Certificate of Designation, as the case may be, will be validly issued and fully paid and nonassessable and free and clear of all pledges, liens and encumbrances. The Certificates evidencing the Securities will be indue and proper form under Delaware law when delivered to the Purchaser.

          (b)      The issuance of the Securities is not subject to preemptive or other similar rights. No further approvalor authority of the shareholders or the Board of Directors of the Company will be required for the issuance and sale of the Securities to be sold by the Company as contemplated in this Agreement or issuable in accordance with the Certificate of Designation. 

          (c)      Subject to the accuracy of the Purchaser's representations and warranties in Section 5 of this Agreement,the offer, sale, and issuance of the Shares, and Conversion Shares and Dividend Shares in conformity with the terms of this Agreement and the Certificate of Designation, respectively, constitute transactions exempt from the registration requirements ofSection 5 of the Securities Act and from the registration or qualification requirements of the laws of any applicable state or United States jurisdiction. 

          (d)      The Company agrees to keep reserved from its authorized and unissued capital stock a sufficient number ofshares of Common Stock or other securities issuable upon conversion of and declaration of dividends, if any, on the Preferred Stock to provide for the issuance of Common Stock on the exercise of the Preferred Stock and the declaration of dividends on thePreferred Stock.

     4.4     Financial Statements

     The financial statements included (as exhibits or otherwise) in the Company Documents (as defined below) present fairly the financial position of the Company as of the dates indicated and theresults of their operations for the periods specified. Except as otherwise stated in such Company Documents, such financial statements have been prepared in conformity with generally accepted accounting principles applied on a consistent basis, and anysupporting schedules included with the financial statements present fairly the information stated in the financial statements. The financial and statistical data set forth in the Company Documents were prepared on an accounting basis consistent with suchfinancial statements.

     4.5     No Material Change

     Since December 30, 2000,

          (a)      there has been no material adverse change or any development involving a prospective material adversechange in or affecting the condition, financial or otherwise, or in the earnings, assets, business affairs or business prospects of the Company, whether or not arising in the ordinary course of business;

          (b)      there have been no transactions entered into by the Company other than those in the ordinary course ofbusiness, which are material with respect to the Company; and

          (c)      there has been no dividend or distribution of any kind declared, paid or made by the Company on any classof its capital stock. 

     The Company has no material contingent obligations.

     4.6     Environmental

     Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the condition, financial or otherwise, or the earnings, assets, business affairs orbusiness prospects of the Company, 

          (a)      the Company is in compliance with all applicable Environmental Laws (as defined below);

          (b)      the Company has all permits, authorizations and approvals required under any applicable EnvironmentalLaws and is in compliance with the requirements of such permits authorizations and approvals;

          (c)      there are no pending or, to the best knowledge of the Company, threatened Environmental Claims (asdefined below) against the Company; and

          (d)      under applicable law, there are no circumstances with respect to any property or operations of theCompany that are reasonably likely to form the basis of an Environmental Claim against the Company.

     For purposes of this Agreement, the following terms shall have the following meanings: "Environmental Law" means any United States (or other applicable jurisdiction's)Federal, state, local or municipal statute, law, rule, regulation, ordinance, code, policy or rule of common law and any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment,relating to the environment, health, safety or any chemical, material or substance, exposure to which is prohibited, limited or regulated by any governmental authority. "Environmental Claims" means any and all administrative, regulatory or judicialactions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigations or proceedings relating in any way to any Environmental Law.

     4.7     No Defaults

     Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the condition, financial or otherwise, or the earnings, assets, business affairs orbusiness prospects of the Company, the Company is not in violation of its certificate of incorporation or bylaws or in material default in the performance or observance of any obligation, agreement, covenant or condition contained in any materialcontract, indenture, mortgage, loan agreement, deed, trust, note, lease, sublease, voting agreement, voting trust, or other instrument or material agreement to which the Company is a party or by which it may be bound, or to which any of the property orassets of the Company is subject. 

     4.8     Labor Matters

     No labor dispute with the employees of the Company exists or, to the best knowledge of the Company, is imminent. 

     4.9     No Actions

     There is no action, suit or proceeding before or by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened, against oraffecting the Company which, singly or in the aggregate, might result in any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company, or which, singly or in the aggregate,might materially and adversely affect the properties or assets thereof or which might materially and adversely affect the consummation of this Agreement, nor, to the best knowledge of the Company, is there any reasonable basis therefor. The Company is notin default with respect to any judgment, order or decree of any court or governmental agency or instrumentality which, singly or in the aggregate, would have a material adverse effect on the assets, properties or business of the Company. 

     4.10     Intellectual Property

     Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the condition, financial or otherwise, or the earnings,assets, business affairs or business prospects of the Company:

          (a)      The Company owns or is licensed to use all patents, patent applications, inventions, trademarks, tradenames, applications for registration of trademarks, service marks, service mark applications, copyrights, know-how, manufacturing processes, formulae, trade secrets, licenses and rights in any thereof and any other intangible property and assets that arematerial to the business of the Company as now conducted and as proposed to be conducted (in this Agreement called the "Proprietary Rights"), or is seeking, or will seek, to obtain rights to use such Proprietary Rights that are material to the business ofthe Company as proposed to be conducted. 

          (b)      The Company does not have any actual knowledge of, and the Company has not given or received any noticeof, any pending conflicts with or infringement of the rights of others with respect to any Proprietary Rights or with respect to any license of Proprietary Rights which are material to the business of the Company. 

          (c)      No action, suit, arbitration, or legal, administrative or other proceeding, or investigation is pending,or, to the best knowledge of the Company, threatened, which involves any Proprietary Rights, nor, to the best knowledge of the Company, is there any reasonable basis therefor.

          (d)      The Company is not subject to any judgment, order, writ, injunction or decree of any court or anyFederal, state, local, foreign or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, or any arbitrator, and has not entered into or is not a party to any contract which restricts or impairs the use ofany such Proprietary Rights in a manner which would have a material adverse effect on the use of any of the Proprietary Rights. 

          (e)      The Company has not received written notice of any pending conflict with or infringement upon suchthird-party proprietary rights.

          (f)      The Company has not entered into any consent, indemnification, forbearance to sue or settlement agreementwith respect to Proprietary Rights other than in the ordinary course of business. No claims have been asserted by any person with respect to the validity of the Company's ownership or right to use the Proprietary Rights and, to the best knowledge of theCompany, there is no reasonable basis for any such claim to be successful. 

          (g)      The Company has complied, in all material respects, with its obligations relating to the protection ofthe Proprietary Rights which are material to the business of the Company used pursuant to licenses. 

          (h)      To the best knowledge of the Company, no person is infringing on or violating the Proprietary Rights.

     4.11     Permits

     The Company possesses and is operating in compliance with all material licenses, certificates, consents, authorities, approvals and permits from all state, federal, foreign and other regulatoryagencies or bodies necessary to conduct the businesses now operated by it, and the Company has not received any notice of proceedings relating to the revocation or modification of any such permit or any circumstance which would lead it to believe thatsuch proceedings are reasonably likely which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would materially and adversely affect the condition, financial or otherwise, or the earnings, assets, business affairsor business prospects of the Company.

     4.12     Due Execution, Delivery and Performance

          (a)      This Agreement has been duly executed and delivered by the Company and constitutes a valid and binding obligation of the Company,enforceable against the Company in accordance with its terms. 

          (b)      The execution, delivery and performance of this Agreement and the consummation of the transactionscontemplated in this Agreement and the fulfillment of the terms of this Agreement have been duly authorized by all necessary corporate action and will not conflict with or constitute a breach of, or default under, or result in the creation or impositionof any lien, charge or encumbrance upon any property or assets of the Company pursuant to, any contract, indenture, mortgage, loan agreement, deed, trust, note, lease, sublease, voting agreement, voting trust or other instrument or agreement to which theCompany is a party or by which it may be bound, or to which any of the property or assets of the Company is subject, and will not trigger anti-dilution rights or other rights to acquire additional equity securities of the Company, nor will such actionresult in any violation of the provisions of the articles of incorporation or bylaws of the Company or any statute, law, rule, regulation, ordinance, decision, directive or order to which the Company is directly subject.

     4.13     Properties

     Except as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the condition, financial or otherwise, or the earnings, assets, business affairs orbusiness prospects of the Company, (i) the Company has good and marketable title to its properties, free and clear of all material security interests, mortgages, pledges, liens, charges, encumbrances and claims of record; (ii) the properties of theCompany are, in the aggregate, in good repair (reasonable wear and tear excepted), and suitable for their respective uses. Any real property held under lease by the Company is held under valid, subsisting and enforceable leases with such exceptions as arenot material and do not interfere with the conduct of the business of the Company; and (iii) the Company owns or leases all such properties as are necessary to its business or operations as now conducted.

     4.14     Compliance

     The Company has conducted and is conducting its business in compliance with all applicable Federal, state, local and foreign statutes, laws, rules, regulations, ordinances, codes, decisions,decrees, directives and orders, except where the failure to do so would not, singly or in the aggregate, have a material adverse effect on the condition, financial or otherwise, or on the earnings, assets, business affairs or business prospects of theCompany.

     4.15     Security Measures

     The Company takes security measures designed to enable the Company to assert trade secret protection in its non-patented technology.

     4.16     Contributions

     To the Company's knowledge, neither the Company nor any employee or agent of the Company has made any payment of funds of the Company or received or retained any funds in violation of any law,rule or regulation.

     4.17     Use of Proceeds; Investment Company

     The Company intends to use the proceeds from the sale of the Shares for working capital and other general corporate purposes. The Company is not now, and after the sale of the Shares under thisAgreement and under all other agreements and the application of the net proceeds from the sale of the Shares described in the preceding sentence will not be, an "investment company" within the meaning of the Investment Company Act of 1940, as amended.

     4.18     Prior Offerings

     All offers and sales of capital stock of the Company before the date of this Agreement were at all relevant times duly registered or exempt from the registration requirements of the SecuritiesAct and were duly registered or subject to an available exemption from the registration requirements of the applicable state securities or Blue Sky laws.

     4.19     Taxes

     The Company has filed all material tax returns required to be filed, which returns are true and correct in all material respects, and the Company is not in default in the payment of any taxes,including penalties and interest, assessments, fees and other charges, shown thereon due or otherwise assessed, other than those being contested in good faith and for which adequate reserves have been provided or those currently payable without interestwhich were payable pursuant to said returns or any assessments with respect thereto.

     4.20     Other Governmental Proceedings

     Except as set forth on the Schedule of Exceptions attached hereto, to the Company's knowledge, there are no rulemaking or similar proceedings before any Federal, state, local or foreigngovernment bodies that involve or affect the Company, which, if the subject of an action unfavorable to the Company, could involve a prospective material adverse change in or effect on the condition, financial or otherwise, or in the earnings, assets,business affairs or business prospects of the Company.

     4.21     Non-Competition Agreements

     To the knowledge of the Company, any full-time employee who has entered into any non-competition, non-disclosure, confidentiality or other similar agreement with any party other than the Companyis neither in violation of nor is expected to be in violation of that agreement as a result of the business currently conducted or expected to be conducted by the Company or such person's performance of his or her obligations to the Company. The Companyhas not received written notice that any consultant or scientific advisor of the Company is in violation of any non-competition, non-disclosure, confidentiality or similar agreement. 

     4.22     Transfer Taxes

     On the Closing Date, all stock transfer or other taxes (other than income taxes) that are required to be paid in connection with the sale and transfer of the Shares to be sold to the Purchaserunder this Agreement will be, or will have been, fully paid or provided for by the Company and all laws imposing such taxes will be or will have been fully complied with.

     4.23     Insurance

     The Company maintains insurance of the type and in the amount that the Company reasonably believes is adequate for its business, including, but not limited to, insurance covering all real andpersonal property owned or leased by the Company against theft, damage, destruction, acts of vandalism and all other risks customarily insured against by similarly situated companies, all of which insurance is in full force and effect.

     4.24     Governmental Consents

     No registration, authorization, approval, qualification or consent of any court or governmental authority or agency is necessary in connection with the execution and delivery of this Agreementor the offering, issuance or sale of the Shares under this Agreement.

     4.25     Securities and Exchange Commission Filings

     The Company has timely filed with the Securities and Exchange Commission (the "Commission") all documents required to be filed by the Company under the Securities Exchange Act of 1934, asamended (the "Exchange Act.")

     4.26     Additional Information

     The Company represents and warrants that the information contained in the following documents (the "Company Documents"), which will be provided to Purchaser before the Closing, is or will betrue and correct in all material respects as of their respective final dates: 

          (a)      The Company's Annual Report on Form 10-K for the fiscal year ended January 1, 2000, for which thefinancial statements in Item 8 are updated in the Current Report on Form 8-K dated February 2, 2001 to include an emphasis of matter paragraph in the independent accountants' report and footnote disclosure related to the Company's liquidity and financialcondition;

          (b)      the Company's Quarterly Reports on Form 10-Q for the quarterly periods ended September 30, 2000, July 1,2000 and April 1, 2000;

          (c)      the Company's Current Report on Form 8-K filed February 2, 2001, which includes updated 1999 financialstatements for an emphasis of matter paragraph in the independent accountants' report and footnote disclosure related to the Company's liquidity and financial conditions;

          (d)      the Company's Current Reports on Form 8-K filed October 16, 2000, November 14, 2000 and February 2, 2001;

          (e)      if available, the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 1999; and

          (f)      all other documents, if any, filed by the Company with the Commission since December 30, 2000 pursuant tothe reporting requirements of the Securities Exchange Act.

     4.27     Contracts

     Except as disclosed in the Company Documents, the material contracts described in the Company Documents or incorporated by reference therein are in full force and effect on the date hereof,except for contracts the termination or expiration of which would not, singly or in the aggregate, have a material adverse effect on the business, properties or assets of the Company. Neither the Company nor, to the best knowledge of the Company, anyother party is in material breach of or default under any such contracts.

     4.28     No Integrated Offering

     Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales in any security or solicited any offers to buyany security under circumstances that would require registration under the Securities Act of the issuance of the Shares to the Purchaser. Based in part upon the representations and warranties of the Purchaser, the issuance of the Securities to thePurchaser will not be integrated with any other issuance of the Company's securities (past, current or future) for purposes of the Securities Act or any applicable rules of Nasdaq (or of any national securities exchange on which the Company's Common Stockis then traded). The Company will not make any offers or sales of any security (other than the Shares) that would cause the offering of the Shares to be integrated with any other offering of securities by the Company for purposes of any registrationrequirement under the Securities Act or any applicable rules of Nasdaq (or of any national securities exchange on which the Company's Common Stock is then traded).

     4.29     Listing of Shares

     The Company agrees to promptly secure the listing of the Conversion Shares and Dividend Shares upon each national securities exchange or automated quotation system upon which shares of CommonStock are then listed and, so long as the Purchaser owns any of the Securities, shall maintain such listing of all Shares. The Company has taken no action designed to delist, or which is likely to have the effect of delisting, the Common Stock from any ofthe national securities exchange or automated quotation system upon which the shares of Common Stock are then listed.

     4.30     No Manipulation of Stock

The Company has not taken and will not, in violation of applicable law, take any action outside the ordinary course of business designed to or that might reasonably be expected to cause or result in unlawful manipulation ofthe price of the Common Stock to facilitate the resale of the Securities.

5.      Representations, Warranties and Covenants of the Purchaser

     5.1     Securities Law Representations and Warranties

     The Purchaser represents, warrants and covenants to the Company as follows: 

          (a)      The Purchaser is knowledgeable, sophisticated and experienced in making, and is qualified to make,decisions with respect to investments in shares representing an investment decision like that involved in the purchase of the Securities, including investments in securities issued by the Company, and has requested, received, reviewed and considered allinformation it deems relevant in making an informed decision to purchase the Securities.

          (b)      The Purchaser is acquiring the Shares and will acquire the Conversion Shares and Dividend Shares in theordinary course of its business and for its own account for investment (as defined for purposes of the Hart-Scott-Rodino Antitrust Improvement Act of 1976 and the regulations thereunder) only, and has no present intention of distributing any of theSecurities nor any arrangement or understanding with any other persons regarding the distribution of such Securities within the meaning of Section 2(11) of the Securities Act, other than as contemplated in Section 7 of this Agreement.

          (c)      The Purchaser will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of (orsolicit any offers to buy, purchase or otherwise acquire or take a pledge of) any of the Securities except in compliance with the Securities Act, the Securities Exchange Act and the respective rules and regulations promulgated thereunder (collectively the"Rules and Regulations").

          (d)      The Purchaser has completed or caused to be completed the Stock Certificate Questionnaire and theRegistration Statement Questionnaire, attached to this Agreement as Appendices I and II, for use in preparation of the Registration Statement (as defined in Section 7.3 below), and the answers to the Questionnaires are true and correct as of the date ofthis Agreement and will be true and correct as of the effective date of the Registration Statement; provided that the Purchaser shall be entitled to update such information by providing notice thereof to the Company before the effective date of suchRegistration Statement.

          (e)      The Purchaser has, in connection with its decision to purchase the number of Shares, relied solely uponthe Company Documents and the representations and warranties of the Company contained in this Agreement.

          (f)      The Purchaser is a "qualified institutional buyer" within the meaning of Rule 144A promulgated under theSecurities Act.

          (g)      The Shares were not offered to the Purchaser through any form of general solicitation or generaladvertising.

          (h)      The Purchaser's office at which the decision to invest in the Securities was made is set forth on thesignature page to this Agreement.

     5.2     Resales of Securities

          (a)      The Purchaser hereby covenants with the Company not to make any sale of the Securities without satisfying the requirements of theSecurities Act and the Rules and Regulations, including, in the event of any resale under the Registration Statement, the prospectus delivery requirements under the Securities Act, and the Purchaser acknowledges and agrees that such Securities are nottransferable on the books of the Company pursuant to a resale under the Registration Statement unless the certificate submitted to the transfer agent evidencing the Shares is accompanied by a separate officer's certificate

               (i)      in the form of Appendix III to this Agreement;

               (ii)      executed by an officer of, or other authorized person designated by, thePurchaser; and 

               (iii)      to the effect that (A) any of the Securities, have been sold inaccordance with the Registration Statement and (B) the requirement of delivering a current prospectus has been satisfied. 

          (b)      The Purchaser acknowledges that there may occasionally be times when the Company determines, in goodfaith following consultation with its Board of Directors or a committee thereof, the use of the prospectus forming a part of the Registration Statement (the "Prospectus," as further defined in Section 7.3.1 below) should be suspended until such time as anamendment or supplement to the Registration Statement or the Prospectus has been filed by the Company and any such amendment to the Registration Statement is declared effective by the Commission, or until such time as the Company has filed an appropriatereport with the Commission pursuant to the Exchange Act. The Purchaser hereby covenants that it will not sell any Securities pursuant to the Prospectus during the period commencing at the time at which the Company gives the Purchaser written notice of thesuspension of the use of the Prospectus and ending at the time the Company gives the Purchaser written notice that the Purchaser may thereafter effect sales pursuant to the Prospectus. The Company may, upon written notice to the Purchaser, suspend the useof the Prospectus for up to ninety (90) days in any 365-day period based on the reasonable determination of the Company's Board of Directors that there is a significant business purpose for such determination, such as pending corporate developments,public filings with the SEC or similar events. The Company shall in no event be required to disclose the business purpose for which it has suspended the use of the Prospectus if the Company determines in its good faith judgment that the business purposeshould remain confidential. In addition, the Company shall notify the Purchaser (i) of any request by the SEC for an amendment or any supplement to such Registration Statement or any related prospectus, or any other information request by any othergovernmental agency directly relating to the offering, and (ii) of the issuance by the SEC of any stop order suspending the effectiveness of such Registration Statement or of any order preventing or suspending the use of any related prospectus or theinitiation or threat of any proceeding for that purpose.

          (c)      The Purchaser further covenants to notify the Company promptly of the sale of any of its Securities,other than sales pursuant to a Registration Statement contemplated in Section 7 of this Agreement or sales upon termination of the transfer restrictions pursuant to Section 7.4 of this Agreement. 

     5.3     Due Execution, Delivery and Performance

          (a)      This Agreement has been duly executed and delivered by the Purchaser and constitutes a valid and binding obligation of thePurchaser, enforceable against the Purchaser in accordance with its terms. 

          (b)      The execution, delivery and performance of this Agreement and the consummation of the transactionscontemplated in this Agreement and the fulfillment of the terms of this Agreement have been duly authorized by all necessary corporate action and will not conflict with or constitute a breach of, or default under, or result in the creation or impositionof any lien, charge or encumbrance upon any property or assets of the Purchaser pursuant to, any contract, indenture, mortgage, loan agreement, deed, trust, note, lease, sublease, voting agreement, voting trust or other instrument or agreement to whichthe Purchaser is a party or by which it or any of them may be bound, or to which any of the property or assets of the Purchaser is subject, nor will such action result in any violation of the provisions of the charter or bylaws of the Purchaser or anyapplicable statute, law, rule, regulation, ordinance, decision, directive or order.

6.      Survival of Representations, Warranties and Agreements.

     Notwithstanding any investigation made by any party to this Agreement, all covenants, agreements, representations and warranties made by the Company and the Purchaser inthis Agreement and in the certificates for the Securities delivered pursuant to this Agreement shall survive the execution of this Agreement, the delivery to the Purchaser of the Securities being purchased and the payment therefor. 

7.      Form D Filing; Registration; Compliance with the Securities Act; Covenants

     7.1     Form D Filing; Registration of Shares

          7.11     Registration Statement; Expenses

     The Company shall: 

     (a)      file in a timely manner a Form D relating to the sale of the Securities under this Agreement, pursuant to Securities and ExchangeCommission Regulation D.

     (b)      as soon as practicable after the Closing Date, but in no event later than the 15th day following the Closing Date, prepare and filewith the Commission a Registration Statement on Form S-3 (or, if the Company is ineligible to use Form S-3, then on Form S-1) relating to the sale of the Securities by the Purchaser from time to time on the Nasdaq National Market (or the facilities of anynational securities exchange on which the Company's Common Stock is then traded) or in privately negotiated transactions (the "Registration Statement");

     (c)      provide to Purchaser any information required to permit the sale of the Securities under Rule 144A of the Securities Act; 

     (d)      subject to receipt of necessary information from the Purchaser, use its best efforts to facilitate notification by the Commission tothe Company of the Commission's willingness to declare the Registration Statement effective on or before 120 days after the Closing Date;

     (e)      notify Purchaser promptly upon the Registration Statement, and any post-effective amendment thereto, being declared effective by theCommission;

     (f)      prepare and file with the Commission such amendments and supplements to the Registration Statement and the Prospectus (as defined inSection 7.3.1 below) and take such other action, if any, as may be necessary to keep the Registration Statement effective until the earlier of (i) the date on which all the Securities may be resold by the Purchaser without registration and without regardto any volume limitations by reason of Rule 144(k) under the Securities Act or any other rule of similar effect or (ii) all of the Securities have been sold pursuant to the Registration Statement or Rule 144 under the Securities Act or any other rule ofsimilar effect;

     (g)      promptly furnish to the Purchaser with respect to the Securities registered under the Registration Statement such reasonable number ofcopies of the Prospectus, including any supplements to or amendments of the Prospectus, in order to facilitate the public sale or other disposition of all or any of the Securities by the Purchaser;

     (h)      during the period when copies of the Prospectus are required to be delivered under the Securities Act or the Securities Exchange Act,will file all documents required to be filed with the Commission pursuant to Section 13, 14 or 15 of the Exchange Act within the time periods required by the Exchange Act and the rules and regulations promulgated thereunder;

     (i)      file documents required of the Company for customary Blue Sky clearance in all states requiring Blue Sky clearance; *provided, however*, that the Company shall not be required to qualify to do business or consent to service of process in any jurisdiction in which it is not now so qualified or has not so consented; and 

     (j)      bear all expenses in connection with the procedures in paragraphs (a) through (i) of this Section 7.1.1 and the registration of theShares pursuant to the Registration Statement. 

          7.1.2     Delay in Effectiveness of Registration Statement

     In the event that the Registration Statement is not declared effective on or before the 120th day following the Closing Date (the "Penalty Date"), the Company shall pay to thePurchaser liquidated damages in an amount equal to 0.25% of the total purchase price of the Shares purchased by such Purchaser pursuant to this Agreement for each week after the Penalty Date that the Registration Statement is not declared effective.

     7.2     Transfer of Securities After Registration

     The Purchaser agrees that it will not effect any disposition of the Securities or its right to purchase or otherwise acquire the Securities that would constitute a sale within the meaning of theSecurities Act, except as contemplated in the Registration Statement referred to in Section 7.1 or as otherwise permitted by law, and that it will promptly notify the Company of any changes in the information set forth in the Registration Statementregarding the Purchaser or its plan of distribution. 

     7.3     Indemnification

     For the purpose of this Section 7.3, the term "Registration Statement" shall include any preliminary or final prospectus, exhibit, supplement or amendment included in or relating to theRegistration Statement referred to in Section 7.1. 

          7.3.1     Indemnification by the Company

The Company agrees to indemnify and hold harmless each of the Purchaser and each person, if any, who controls the Purchaser within the meaning of the Securities Act, against any losses, claims, damages, liabilities orexpenses, joint or several, to which such Purchaser or such controlling person may become subject, under the Securities Act, the Exchange Act, or any other federal or state statutory law or regulation, or at common law or otherwise (including insettlement of any litigation, if such settlement is effected with the written consent of the Company, which consent shall not be unreasonably withheld), insofar as such losses, claims, damages, liabilities or expenses (or actions in respect thereof ascontemplated below) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Registration Statement, including the Prospectus, financial statements and schedules, and all other documents filedas a part thereof, as amended at the time of effectiveness of the Registration Statement, including any information deemed to be a part thereof as of the time of effectiveness pursuant to paragraph (b) of Rule 430A, or pursuant to Rule 434, of the Rulesand Regulations, or the Prospectus, in the form first filed with the Commission pursuant to Rule 424(b) of the Regulations, or filed as part of the Registration Statement at the time of effectiveness if no Rule 424(b) filing is required (the"Prospectus"), or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state in any of them a material fact required to be stated therein or necessary to make the statements in any of them, in light ofthe circumstances under which they were made, not misleading, or arise out of or are based in whole or in part on any inaccuracy in the representations and warranties of the Company contained in this Agreement, or any failure of the Company to perform itsobligations under this Agreement or under law, and will reimburse the Purchaser and each such controlling person for any legal and other expenses as such expenses are reasonably incurred by such Purchaser or such controlling person in connection withinvestigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense or action; *provided, however*, that the Company will not be liable in any such case to the extent that any such loss, claim, damage, liability or expense arises out of or is based upon (i) an untrue statement or alleged untrue statement or omission or allegedomission made in the Registration Statement, the Prospectus or any amendment or supplement of the Registration Statement or Prospectus in reliance upon and in conformity with written information furnished to the Company by or on behalf of the Purchaserexpressly for use in the Registration Statement or the Prospectus, or (ii) the failure of such Purchaser to comply with the covenants and agreements contained in Sections 5.2 or 7.2 of this Agreement respecting resale of the Shares, or (iii) theinaccuracy of any representations made by such Purchaser in this Agreement or (iv) any untrue statement or omission of a material fact required to make such statement not misleading in any Prospectus that is corrected in any subsequent Prospectus that wasdelivered to the Purchaser before the pertinent sale or sales by the Purchaser.

          7.3.2     Indemnification by the Purchaser

The Purchaser will severally and not jointly indemnify and hold harmless the Company, each of its directors, each of its officers who signed the Registration Statement and each person, if any, who controls the Company withinthe meaning of the Securities Act, against any losses, claims, damages, liabilities or expenses to which the Company, each of its directors, each of its officers who signed the Registration Statement or controlling person may become subject, under theSecurities Act, the Exchange Act, or any other federal or state statutory law or regulation, or at common law or otherwise (including in settlement of any litigation, if such settlement is effected with the written consent of such Purchaser, which consentshall not be unreasonably withheld) insofar as such losses, claims, damages, liabilities or expenses (or actions in respect thereof as contemplated below) arise out of or are based upon (i) any failure on the part of such Purchaser to comply with thecovenants and agreements contained in Sections 5.2 or 7.2 of this Agreement respecting the sale of the Shares or (ii) the inaccuracy of any representation or warranty made by such Purchaser in this Agreement or (iii) any untrue or alleged untrue statementof any material fact contained in the Registration Statement, the Prospectus, or any amendment or supplement to the Registration Statement or Prospectus, or arise out of or are based upon the omission or alleged omission to state therein a material factrequired to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in theRegistration Statement, the Prospectus, or any amendment or supplement thereto, in reliance upon and in conformity with written information furnished to the Company by or on behalf of such Purchaser expressly for use therein; *provided, however*, that the Purchaser shall not be liable for any such untrue or alleged untrue statement or omission or alleged omission of which the Purchaser has delivered to the Company in writing a correction before the occurrence of thetransaction from which such loss was incurred, and the Purchaser will reimburse the Company, each of its directors, each of its officers who signed the Registration Statement or controlling person for any legal and other expense reasonably incurred by theCompany, each of its directors, each of its officers who signed the Registration Statement or controlling person in connection with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense or action. 

          7.3.3     Indemnification Procedure

     (a)      Promptly after receipt by an indemnified party under this Section 7.3 of notice of the threat or commencement of any action, such indemnified party will, if aclaim in respect thereof is to be made against an indemnifying party under this Section 7.3, promptly notify the indemnifying party in writing of the claim; but the omission so to notify the indemnifying party will not relieve it from any liability whichit may have to any indemnified party for contribution or otherwise under the indemnity agreement contained in this Section 7.3 or to the extent it is not prejudiced as a result of such failure. 

     (b)      In case any such action is brought against any indemnified party and such indemnified party seeks or intends to seek indemnity from anindemnifying party, the indemnifying party will be entitled to participate in, and, to the extent that it may wish, jointly with all other indemnifying parties similarly notified, to assume the defense thereof with counsel reasonably satisfactory to suchindemnified party; *provided, however*, if the defendants in any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there may be a conflict between the positions of the indemnifyingparty and the indemnified party in conducting the defense of any such action or that there may be legal defenses available to it or other indemnified parties that are different from or additional to those available to the indemnifying party, theindemnified party or parties shall have the right to select separate counsel to assume such legal defenses and to otherwise participate in the defense of such action on behalf of such indemnified party or parties. Upon receipt of notice from theindemnifying party to such indemnified party of its election so to assume the defense of such action and approval by the indemnified party of counsel, the indemnifying party will not be liable to such indemnified party under this Section 7.3 for any legalor other expenses subsequently incurred by such indemnified party in connection with the defense thereof unless: 

          (i)      the indemnified party shall have employed such counsel in connection with the assumption of legaldefenses in accordance with the proviso to the preceding sentence (it being understood, however, that the indemnifying party shall not be liable for the expenses of more than one separate counsel, approved by such indemnifying party representing all ofthe indemnified parties who are parties to such action), or 

          (ii)      the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified partyto represent the indemnified party within a reasonable time after notice of commencement of action, in each of which cases the reasonable fees and expenses of counsel shall be at the expense of the indemnifying party. Notwithstanding the provisions ofthis Section 7.3, the Purchaser shall not be liable for any indemnification obligation under this Agreement in excess of the amount of gross proceeds received by the Purchaser from the sale of the Shares. 

          7.3.4     Contribution

     If the indemnification provided for in this Section 7.3 is required by its terms but is for any reason held to be unavailable to or otherwise insufficient to hold harmless an indemnified partyunder this Section 7.3 in respect to any losses, claims, damages, liabilities or expenses referred to in this Agreement, then each applicable indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of anylosses, claims, damages, liabilities or expenses referred to in this Agreement

     (a)      in such proportion as is appropriate to reflect the relative benefits received by the Company and the Purchaser from the placement ofShares, or

     (b)      if the allocation provided by clause (a) above is not permitted by applicable law, in such proportion as is appropriate to reflect notonly the relative benefits referred to in clause (a) above but the relative fault of the Company and the Purchaser in connection with the statements or omissions or inaccuracies in the representations and warranties in this Agreement that resulted in suchlosses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. 

     The respective relative benefits received by the Company on the one hand and the Purchaser on the other shall be deemed to be in the same proportion as the amount paidby such Purchaser to the Company pursuant to this Agreement for the Shares purchased by such Purchaser that were sold pursuant to the Registration Statement bears to the difference (the "Difference") between the amount such Purchaser paid for the Sharesthat were sold pursuant to the Registration Statement and the amount received by such Purchaser from such sale. The relative fault of the Company and the Purchaser shall be determined by reference to, among other things, whether the untrue or allegedstatement of a material fact or the omission or alleged omission to state a material fact or the inaccurate or the alleged inaccurate representation or warranty relates to information supplied by the Company or by such Purchaser and the parties' relativeintent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed toinclude, subject to the limitations set forth in Section 7.3.3, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim. The provisions set forth in Section 7.3.3 with respectto the notice of the threat or commencement of any threat or action shall apply if a claim for contribution is to be made under this Section 7.3.4; *provided, however*, that no additional notice shall be required with respect to any threat or action for which notice has been given under Section 7.3 for purposes of indemnification. The Company and the Purchaser agrees that it would not be justand equitable if contribution pursuant to this Section 7.3 were determined solely by pro rata allocation (even if the Purchaser was treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitableconsiderations referred to in this paragraph. Notwithstanding the provisions of this Section 7.3, no Purchaser shall be required to contribute any amount in excess of the amount by which the Difference exceeds the amount of any damages that such Purchaserhas otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled tocontribution from any person who was not guilty of such fraudulent misrepresentation. 

     7.4     Termination of Conditions and Obligations

     The restrictions imposed by Section 5 or this Section 7 upon the transferability of the Securities shall cease and terminate as to any particular Securities (i) on the date on which the relevantShares, Conversion Shares or Dividend Shares may be resold by the Purchaser without registration and without regard to any volume limitations by reason of Rule 144(k) under the Securities Act, or (ii) at such time as an opinion of counsel satisfactory inform and substance to the Company shall have been rendered to the effect that such conditions are not necessary in order to comply with the Securities Act. 

     7.5     Information Available

     From the date of this Agreement through the date that the Registration Statement covering the resale of Securities owned by the Purchaser is no longer effective, the Company will furnish to thePurchaser: 

     (a)      as soon as practicable after available (but in the case of the Company's Annual Report to Shareholders, within 90 days after the end ofeach fiscal year of the Company), one copy of 

          (i)      its Annual Report to Shareholders (which Annual Report shall contain financial statements audited inaccordance with generally accepted accounting principles by a national firm of certified public accountants);

          (ii)      if not included in substance in the Annual Report to Shareholders, its Annual Report on Form 10-K;

          (iii)      if not included in substance in its Quarterly Reports to Shareholders, its quarterly reports on Form10-Q; and 

          (iv)      a full copy of the particular Registration Statement covering the Securities (the foregoing, in eachcase, excluding exhibits); 

     (b)      upon the request of the Purchaser, a reasonable number of copies of the Prospectus to supply to any other party requiring the Prospectus. 

     7.6     Rule 144 Information

     Until the earlier of (i) the date on which all the Shares, the Conversion Shares and the Dividend Shares may be resold by the Purchaser without registration and without regard to any volumelimitations by reason of Rule 144(k) under the Securities Act or any other rule of similar effect or (ii) all the Shares, Conversion Shares and Dividend Shares have been sold pursuant to the Registration statement or Rule 144 under the Securities Act orany rule of similar effect, the Company shall file all reports required to be filed by it under the Securities Act, the Securities Exchange Act and the Rules and Regulations and shall take such further action to the extent required to enable the Purchaserto sell the Securities pursuant to Rule 144 under the Securities Act (as such rule may be amended from time to time).

     7.7     Stock Option and Other Matters

     The Company shall, within thirty (30) days of the Closing Date, adopt such amendments to, with respect to (i) and (ii) below, the Company's stock option plans and By-laws, and, with respect to(iii) below, the Company's By-laws (together, the "Stock Option Plan and By-law Amendments") to provide that,unless approved by the holders of a majority of the shares present and entitled to vote at a duly convened meeting of shareholders, the Company shall not (i) grant any stock options with an exercise price that is less than 100%of the fair market value of the underlying stock on the date of grant; (ii) reduce the exercise price of any stock option granted under any existing or future stock option plan; or (iii) sell or issue any security convertible, exercisable or exchangeableinto shares of Common Stock, having a conversion, exercise or exchange price per share which is subject to downward adjustment based on the market price of the Common Stock at the time of conversion, exercise or exchange of such security into Common Stock(except for appropriate adjustments made to give effect to any stock split, stock dividends or other similar change in the Company's capital stock). The Stock Option Plan and By-law Amendments may not be further amended or repealed without the affirmativevote of the holders of a majority of the shares present and entitled to vote at a duly convened meeting of shareholders. Upon the adoption of the Stock Option Plan and By-law Amendments, the Company shall promptly furnish a copy of such amendments to thePurchaser. The Company agrees that, prior to the adoption of the Stock Option Plan and By-law Amendments by all necessary corporate action of the Company as described above, the Company shall not conduct any of the actions specified in (i), (ii) or (iii)above of this Section 7.7. 

8.      Legal Fees and Other Transaction Expenses

     At the Closing, the Company agrees to pay a flat fee of $7,500 to the Purchaser for its legal and other transaction expenses (whether internal or external) arising in connection with thetransactions contemplated by this Agreement.

9.      broker's fee

Each of the parties to this Agreement hereby represents that there are no brokers or finders entitled to compensation in connection with the sale of the Shares to the Purchaser.

10.     Notices

     All notices, requests, consents and other communications under this Agreement shall be in writing, shall be mailed by first-class registered or certified airmail, confirmed facsimile ornationally recognized overnight express courier postage prepaid, and shall be delivered as addressed as follows: