Document:

EXHIBIT 10.11

                              First Allonge to the
                 Promissory Note dated January 22, 2001 made by
                                ASPI EUROPE, INC.
                                   in favor of
                                 RICARDO REQUENA

     THIS FIRST  ALLONGE to the  Promissory  Note,  dated  January 22, 2001 (the
"Promissory  Note"),  made by ASPI  EUROPE,  INC., a Delaware  corporation  (the
"Company"), in favor of RICARDO REQUENA ("Lender"), is made as of the 6th day of
August, 2001 by and between the Company and the Lender.

                                   BACKGROUND

     WHEREAS,  on January 22, 2001, the Lender made a loan to the Company in the
amount of US $50,000 as evidenced by the Promissory  Note,  and such  Promissory
Note was due and payable on or before May 18, 2000;

     NOW,  THEREFORE,  in  consideration of the Company agreeing to increase the
interest  payable to the  Lender,  the Company  and the Lender  hereby  agree as
follows:

     1. The Lender will waive its  immediate  right to full payment and interest
of the US $50,000  Promissory  Note due May 18, 2001, and will amend and restate
the first paragraph of the Promissory Note to read as follows:

     "FOR VALUE RECEIVED,  the undersigned  ASPi Europe,  Inc. ( the "Company ")
hereby  promises  to pay on or  before  October  15,  2001 to or to the order of
Ricardo  Requena  ("Lender") at such address as the Lender may from time to time
direct, the principal sum of FIFTY THOUSAND DOLLARS ($50,000.00) of lawful money
of the United States of America with  interest  thereon at the annual rate equal
to (10%) ten percent through July 31, 2001 and (12.5%) twelve and a half percent
thereafter in such amounts set forth herein."

     2. Except as amended  herein,  the  Promissory  Note shall continue in full
force and effect and shall be enforceable in accordance with its terms.  Nothing
herein contained shall constitute a novation of the Promissory Note.

     3. This First  Allonge and the  Promissory  Note shall  constitute a single
instrument.

     IN  WITNESS  WHEREOF,  the  Company  has caused  this First  Allonge to the
Promissory Note to be signed by its duly authorized officer as of the 6th day of
August, 2001.

                                ASPI EUROPE, INC.

                                By:      "F. Thomas Winters III"
                                         --------------------------------------
                                Name:    F. Thomas Winters III
                                Title:   Chief Executive Officer

                                RICARDO REQUENA

                                By:      "Ricardo Requena"
                                         --------------------------------------
                                Name:    Ricardo RequenaEXHIBIT 10.12

                              Third Allonge to the
                   Promissory Note dated May 17, 2000 made by
                                ASPI EUROPE, INC.
                                   in favor of
                       MANHATTAN INVESTMENTS INCORPORATED

     THIS  THIRD  ALLONGE  to the  Promissory  Note,  dated  May 17,  2000  (the
"Promissory  Note"),  made by ASPI  EUROPE,  INC., a Delaware  corporation  (the
"Company"), in favor of MANHATTAN INVESTMENTS INCORPORATED,  a Nevis corporation
("MAN"),  is made as of the 9th day of August,  2001 by and  between the Company
and MAN.

                                   BACKGROUND

     WHEREAS,  on May 17, 2000,  MAN made a loan to the Company in the amount of
US $125,000 as evidenced by the Promissory  Note, and such  Promissory  Note was
due and payable on or before August 31, 2000; and

     WHEREAS,  on October 12, 2000,  MAN and the Company  entered into the First
Allonge (the "First  Allonge") to amend  certain  terms of the  Promissory  Note
whereby  accrued  interest on the Promissory Note was due and payable on January
31, 2001 and August 31, 2001 and the  principal  was due and payable on July 31,
2001; and

     WHEREAS,  on April 10,  2001,  MAN and the Company  entered into the Second
Allonge (the "Second  Allonge") to amend  certain terms of the  Promissory  Note
whereby accrued interest on the Promissory Note was due and payable on April 30,
2001 and on July 31, 2001; and

     NOW,  THEREFORE,  in  consideration of the Company agreeing to increase the
interest  rate from ten percent  (10%) to twelve and a half  percent  (12.5%) to
MAN, the Company and MAN hereby agree as follows:

     1. MAN will waive its immediate  right to full payment of the principal and
interest  of the US  $125,000  Promissory  Note due April 30,  2001 and July 31,
2001, and will amend and restate the third  paragraph of the Promissory  Note to
read as follows:

     "Interest  on this note  shall  accrue at a per annum  rate of ten  percent
(10%) through July 31, 2001 and will accrue at twelve and a half percent (12.5%)
thereafter.  The  principal  and accrued  interest will be payable on August 31,
2001."

     2. Except as amended  herein,  the  Promissory  Note shall continue in full
force and effect and shall be enforceable in accordance with its terms.  Nothing
herein contained shall constitute a novation of the Promissory Note.

     3. This  Third  Allonge,  the Second  Allonge,  the First  Allonge  and the
Promissory Note shall constitute a single instrument.

<PAGE>

     IN  WITNESS  WHEREOF,  the  Company  has caused  this Third  Allonge to the
Promissory Note to be signed by its duly authorized officer as of the 9th day of
August, 2001.

                                 ASPI EUROPE, INC.

                                 By:      "F. Thomas Winters III"
                                          -------------------------------------
                                 Name:    F. Thomas Winters III
                                 Title:   Chief Executive Officer

                                 MANHATTAN INVESTMENTS INCORPORATED

                                 By:      "David Craven"
                                          -------------------------------------
                                 Name:    David Craven
                                 Title:   Director<P ALIGN="CENTER">&#9;&#9;</P>
<B><P ALIGN="CENTER">    Exhibit 10.155</P>
</B><P ALIGN="CENTER">AGREEMENT AND PLAN OF MERGER</P>
<P ALIGN="CENTER">Dated as of June 12, 2001</P>
<P ALIGN="CENTER">Among </P>
<P ALIGN="CENTER">Axys Pharmaceuticals, Inc.,</P>
<P ALIGN="CENTER">Applera Corporation,</P>
<P ALIGN="CENTER">And</P>
<P ALIGN="CENTER">Angel Acquisition Sub, Inc. </P>
<P ALIGN="CENTER"></P>
<B><P ALIGN="CENTER">TABLE OF CONTENTS</P>
<U><P ALIGN="RIGHT">Page</P>
</B></U><P>Article I THE MERGER&#9;<A HREF="#_Toc517021604">*</A><DIR>
<DIR>
<DIR>
<DIR>

<P>Section 1.01&#9;The Merger.&#9;<A HREF="#_Toc517021605">*</A></P>
<P>Section 1.02&#9;Closing.&#9;<A HREF="#_Toc517021606">*</A></P>
<P>Section 1.03&#9;Effective Time of the Merger.&#9;<A
HREF="#_Toc517021607">*</A></P>
<P>Section 1.04&#9;Effects of the Merger.&#9;<A HREF="#_Toc517021608">*</A></P>
<P>Section 1.05&#9;Certificate of Incorporation; By-laws.&#9;<A
HREF="#_Toc517021609">*</A></P>
<P>Section 1.06&#9;Directors.&#9;<A HREF="#_Toc517021610">*</A></P>
<P>Section 1.07&#9;Officers.&#9;<A HREF="#_Toc517021611">*</A></P>
<P>Section 1.08&#9;Effect on Capital Stock.&#9;<A
HREF="#_Toc517021612">*</A></P>
<P>Section 1.09&#9;Exchange of Certificates.&#9;<A
HREF="#_Toc517021613">*</A></P>
<P>Section 1.10&#9;Treatment of Options<I>.</I>&#9;<A
HREF="#_Toc517021614">*</A></P>
<P>Section 1.11&#9;Treatment of Debt Securities, Convertible Notes and Company
Warrants<I>.</I>&#9;<A HREF="#_Toc517021615">*</A></P></DIR>
</DIR>

<P>Article II REPRESENTATIONS AND WARRANTIES OF THE COMPANY&#9;<A
HREF="#_Toc517021616">*</A></P><DIR>
<DIR>

<P>Section 2.01&#9;Organization, Standing and Corporate Power.&#9;<A
HREF="#_Toc517021617">*</A></P>
<P>Section 2.02&#9;Subsidiaries and Minority Investments.&#9;<A
HREF="#_Toc517021618">*</A></P>
<P>Section 2.03&#9;Capital Structure.&#9;<A HREF="#_Toc517021619">*</A></P>
<P>Section 2.04&#9;Authority.&#9;<A HREF="#_Toc517021620">*</A></P>
<P>Section 2.05&#9;Noncontravention.&#9;<A HREF="#_Toc517021621">*</A></P>
<P>Section 2.06&#9;SEC Documents; Financial Statements.&#9;<A
HREF="#_Toc517021622">*</A></P>
<P>Section 2.07&#9;Undisclosed Liabilities.&#9;<A
HREF="#_Toc517021623">*</A></P>
<P>Section 2.08&#9;Information Supplied.&#9;<A HREF="#_Toc517021624">*</A></P>
<P>Section 2.09&#9;Absence of Certain Changes or Events.&#9;<A
HREF="#_Toc517021625">*</A></P>
<P>Section 2.10&#9;Litigation.&#9;<A HREF="#_Toc517021626">*</A></P>
<P>Section 2.11&#9;Labor Matters.&#9;<A HREF="#_Toc517021627">*</A></P>
<P>Section 2.12&#9;Permits; Compliance with Laws.&#9;<A
HREF="#_Toc517021628">*</A></P>
<P>Section 2.13&#9;Employee Benefit Plans.&#9;<A HREF="#_Toc517021629">*</A></P>
<P>Section 2.14&#9;Taxes.&#9;<A HREF="#_Toc517021630">*</A></P>
<P>Section 2.15&#9;Properties.&#9;<A HREF="#_Toc517021631">*</A></P>
<P>Section 2.16&#9;Environmental Matters.&#9;<A HREF="#_Toc517021632">*</A></P>
<P>Section 2.17&#9;Contracts; Debt Instruments.&#9;<A
HREF="#_Toc517021633">*</A></P>
<P>Section 2.18&#9;Intellectual Property.&#9;<A HREF="#_Toc517021634">*</A></P>
<P>Section 2.19&#9;Brokers and Other Advisors.&#9;<A
HREF="#_Toc517021635">*</A></P>
<P>Section 2.20&#9;Opinion of Financial Advisor.&#9;<A
HREF="#_Toc517021636">*</A></P>
<P>Section 2.21&#9;Board Recommendation; State Antitakeover Law.&#9;<A
HREF="#_Toc517021637">*</A></P>
<P>Section 2.22&#9;Required Company Vote.&#9;<A HREF="#_Toc517021638">*</A></P>
<P>Section 2.23&#9;Rights Agreement.&#9;<A HREF="#_Toc517021639">*</A></P>
<P>Section 2.24&#9;Affiliate Transactions.&#9;<A
HREF="#_Toc517021640">*</A></P></DIR>
</DIR>

<P>Article III REPRESENTATIONS AND WARRANTIES OF PARENT&#9;<A
HREF="#_Toc517021641">*</A></P><DIR>
<DIR>

<P>Section 3.01&#9;Organization, Standing and Corporate Power.&#9;<A
HREF="#_Toc517021642">*</A></P>
<P>Section 3.02&#9;Capital Structure.&#9;<A HREF="#_Toc517021643">*</A></P>
<P>Section 3.03&#9;Authority.&#9;<A HREF="#_Toc517021644">*</A></P>
<P>Section 3.04&#9;Noncontravention.&#9;<A HREF="#_Toc517021645">*</A></P>
<P>Section 3.05&#9;Parent SEC Documents; Financial Statements.&#9;<A
HREF="#_Toc517021646">*</A></P>
<P>Section 3.06&#9;Undisclosed Liabilities.&#9;<A
HREF="#_Toc517021647">*</A></P>
<P>Section 3.07&#9;Information Supplied.&#9;<A HREF="#_Toc517021648">*</A></P>
<P>Section 3.08&#9;Absence of Certain Changes or Events.&#9;<A
HREF="#_Toc517021649">*</A></P>
<P>Section 3.09&#9;Litigation; Compliance with Laws.&#9;<A
HREF="#_Toc517021650">*</A></P>
<P>Section 3.10&#9;Brokers.&#9;<A HREF="#_Toc517021651">*</A></P>
<P>Section 3.11&#9;Interim Operations of Merger Sub.&#9;<A
HREF="#_Toc517021652">*</A></P>
<P>Section 3.12&#9;Required Vote<I>.</I>&#9;<A
HREF="#_Toc517021653">*</A></P></DIR>
</DIR>

<P>Article IV COVENANTS RELATING TO CONDUCT OF BUSINESS PRIOR TO MERGER.&#9;<A
HREF="#_Toc517021654">*</A></P><DIR>
<DIR>

<P>Section 4.01&#9;Conduct of Business by the Company.&#9;<A
HREF="#_Toc517021655">*</A></P>
<P>Section 4.02&#9;Conduct of Business by Parent.&#9;<A
HREF="#_Toc517021656">*</A></P>
<P>Section 4.03&#9;Employment Arrangements.&#9;<A
HREF="#_Toc517021657">*</A></P>
<P>Section 4.04&#9;Tax Elections.&#9;<A HREF="#_Toc517021658">*</A></P>
<P>Section 4.05&#9;Tax-Free Reorganization Treatment.&#9;<A
HREF="#_Toc517021659">*</A></P>
<P>Section 4.06&#9;Other Actions.&#9;<A HREF="#_Toc517021660">*</A></P></DIR>
</DIR>

<P>Article V ADDITIONAL AGREEMENTS&#9;<A HREF="#_Toc517021661">*</A></P><DIR>
<DIR>

<P>Section 5.01&#9;Preparation of Form S-4 and Proxy Statement; Stockholder
Meeting.&#9;<A HREF="#_Toc517021662">*</A></P>
<P>Section 5.02&#9;Access to Information; Confidentiality.&#9;<A
HREF="#_Toc517021663">*</A></P>
<P>Section 5.03&#9;Reasonable Best Efforts.&#9;<A
HREF="#_Toc517021664">*</A></P>
<P>Section 5.04&#9;Indemnification.&#9;<A HREF="#_Toc517021665">*</A></P>
<P>Section 5.05&#9;Public Announcements.&#9;<A HREF="#_Toc517021666">*</A></P>
<P>Section 5.06&#9;No Solicitation.&#9;<A HREF="#_Toc517021667">*</A></P>
<P>Section 5.07&#9;Benefit Matters.&#9;<A HREF="#_Toc517021668">*</A></P>
<P>Section 5.08&#9;Stock Exchange Listing.&#9;<A HREF="#_Toc517021669">*</A></P>
<P>Section 5.09&#9;Letters of the Company's Accountants.&#9;<A
HREF="#_Toc517021670">*</A></P>
<P>Section 5.10&#9;Rights Agreement.&#9;<A HREF="#_Toc517021671">*</A></P>
<P>Section 5.11&#9;Convertible Notes.&#9;<A HREF="#_Toc517021672">*</A></P>
<P>Section 5.12&#9;Non-solicitation of Employees.&#9;<A
HREF="#_Toc517021673">*</A></P>
<P>Section 5.13&#9;Stock Options.&#9;<A HREF="#_Toc517021674">*</A></P></DIR>
</DIR>

<P>Article VI CONDITIONS PRECEDENT&#9;<A HREF="#_Toc517021675">*</A></P><DIR>
<DIR>

<P>Section 6.01&#9;Conditions to Each Party's Obligation To Effect the
Merger.&#9;<A HREF="#_Toc517021676">*</A></P>
<P>Section 6.02&#9;Conditions to Obligations of Parent and Merger Sub.&#9;<A
HREF="#_Toc517021677">*</A></P>
<P>Section 6.03&#9;Conditions to Obligation of the Company.&#9;<A
HREF="#_Toc517021678">*</A></P></DIR>
</DIR>

<P>Article VII TERMINATION, AMENDMENT AND WAIVER&#9;<A
HREF="#_Toc517021679">*</A></P><DIR>
<DIR>

<P>Section 7.01&#9;Termination.&#9;<A HREF="#_Toc517021680">*</A></P>
<P>Section 7.02&#9;Effect of Termination.&#9;<A HREF="#_Toc517021681">*</A></P>
<P>Section 7.03&#9;Amendment.&#9;<A HREF="#_Toc517021682">*</A></P>
<P>Section 7.04&#9;Extension; Waiver.&#9;<A HREF="#_Toc517021683">*</A></P>
<P>Section 7.05&#9;Procedure for Termination, Amendment, Extension or
Waiver.&#9;<A HREF="#_Toc517021684">*</A></P></DIR>
</DIR>

<P>Article VIII GENERAL PROVISIONS&#9;<A HREF="#_Toc517021685">*</A></P><DIR>
<DIR>

<P>Section 8.01&#9;Nonsurvival of Representations and Warranties.&#9;<A
HREF="#_Toc517021686">*</A></P>
<P>Section 8.02&#9;Fees and Expenses.&#9;<A HREF="#_Toc517021687">*</A></P>
<P>Section 8.03&#9;Notices.&#9;<A HREF="#_Toc517021688">*</A></P>
<P>Section 8.04&#9;Interpretation.&#9;<A HREF="#_Toc517021689">*</A></P>
<P>Section 8.05&#9;Counterparts.&#9;<A HREF="#_Toc517021690">*</A></P>
<P>Section 8.06&#9;Entire Agreement; No Third-Party Beneficiaries.&#9;<A
HREF="#_Toc517021691">*</A></P>
<P>Section 8.07&#9;GOVERNING LAW.&#9;<A HREF="#_Toc517021692">*</A></P>
<P>Section 8.08&#9;Assignment.&#9;<A HREF="#_Toc517021693">*</A></P>
<P>Section 8.09&#9;Enforcement.&#9;<A HREF="#_Toc517021694">*</A></P>
</DIR>
</DIR>
</DIR>
</DIR>
</P>
<B><P ALIGN="CENTER">Index of Defined Terms</P></B>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=440>
<TR><TD WIDTH="62%" VALIGN="TOP">
<U><P>Term</U></TD>
<TD WIDTH="38%" VALIGN="TOP">
<U><P>Section</U></TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>2000 Balance Sheet</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.07</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>AB Stock</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>3.02(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Action</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>5.04(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Acquisition Agreements</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.17(a)(vii)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Affiliate</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.20</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Bylaws</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.01</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Certificate of Incorporation</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.01</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Certificate of Merger</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.03</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Certificates</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.08(d)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Closing</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.02</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Closing Date</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.02</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Code</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Recitals</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Preamble</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Common Stock</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Recitals</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Disclosure Schedule</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Article II</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Insurance</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>5.04(b)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Material Adverse Effect</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.01</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Permits</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.12</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Plans</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.13(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company SEC Documents</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.06</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Stock Option</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.10(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Stock Plans</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.10(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Stockholder Approval</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Recitals</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Company Warrants</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.11(b)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Confidentiality Agreement</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>5.02</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Contract</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.17(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Control</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.20</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Controlled Group</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.13(c)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Convertible Notes</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.11(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Convertible Notes Indenture</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.11(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>DGCL</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Recitals</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Effective Time</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.03</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Environmental Laws</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.16(c)(i)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Environmental Report</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.16(c)(ii)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Equity Interest</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.02(b)(ii)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>ERISA</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.13(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Exchange Act</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.05(b)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Exchange Agent</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.09(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Exchange Fund</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.09(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Exchange Ratio</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.08(c)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Final Offering Period</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.10(d)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Form S-4</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.08</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>GAAP</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.06(b)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Governmental Entity</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.05(b)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>HSR Act</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.05(b)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Incentive stock options</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.10(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Indebtedness</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.03(c)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Indenture</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.11(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Indemnified Party</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>5.04(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Intellectual Property</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.18(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>JP Morgan</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.19</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Knowledge of the Company</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.02(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Knowledge of Parent</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>3.09(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Laws</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.05(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Licensed Patent Intellectual Property</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.18(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Liens</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.02(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Material Contracts</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.17(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Material Intellectual Property</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.18(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Materials of Environmental Concern</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.16(c)(iii)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Merger</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Recitals</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Merger Consideration</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.08(c)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Merger Sub</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Preamble</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Minority Investment</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.02(b)(iii)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Minority Investment Documents</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.02(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Morgan Stanley</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>3.10</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>NYSE</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.09(c)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Preamble</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent Common Stock</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.08(c)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent Common Stock Price</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.08(c)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent Disclosure Schedule</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>Article III</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent Material Adverse Effect</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>3.01</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent Preferred Stock</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>3.02(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent SEC Documents</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>3.05</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent Stock Option</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.10(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent Stock Plans</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>3.02(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Parent Subsidiaries</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>3.01</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Person</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.09(g)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Proxy Statement</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>5.01(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Registered Intellectual Property</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.18(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Remedial Action</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.16(c)(iv)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Rights</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.09(d)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Rights Agreement</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.09(d)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>SEC</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.05(b)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Securities Act</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.06(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Stock Purchase Plan</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.03</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Stockholders Meeting</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>5.01(c)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Subsidiary</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.02(b)(i)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Subsidiary Documents</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.02(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Superior Proposal</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>5.06</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Surviving Company</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.01</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Taxes</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.14</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Tax Return</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.14</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Third Party</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>8.02(a)(i)(A)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Transaction Proposals</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>5.06</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Transactions</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.02</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Trustee</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>1.11(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>Voting Debt</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.03(a)</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">
<P>WARN</TD>
<TD WIDTH="38%" VALIGN="TOP">
<P>2.11</TD>
</TR>
<TR><TD WIDTH="62%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="38%" VALIGN="TOP">&nbsp;</TD>
</TR>
</TABLE>
</CENTER></P>

<P>&nbsp;</P>
<P>AGREEMENT AND PLAN OF MERGER, dated as of June 12, 2001, among Applera
Corporation, a Delaware corporation (&quot;<U>Parent</U>&quot;), Angel
Acquisition Sub, Inc., a Delaware corporation and a direct wholly owned
subsidiary of Parent (&quot;<U>Merger Sub</U>&quot;), and Axys Pharmaceuticals,
Inc., a Delaware corporation (the &quot;<U>Company</U>&quot;).</P>
<B><P ALIGN="CENTER">W I T N E S S E T H:</P>
</B><P>WHEREAS, the respective boards of directors of Parent, Merger Sub and the
Company have determined that the merger of Merger Sub with and into the Company
(the &quot;<U>Merger</U>&quot;), upon the terms and subject to the conditions
set forth in this Agreement, would be fair and in the best interests of their
respective stockholders;</P>
<P>WHEREAS, such boards of directors have approved the Merger, pursuant to which
each share of common stock, par value $.001 per share, of the Company (the
&quot;<U>Company Common Stock</U>,&quot; which term also refers to and includes,
unless the context otherwise requires, the associated Rights (as defined
below)), other than shares owned by the Company, Parent or Merger Sub, will be
converted into the right to receive the Merger Consideration (as defined below),
upon the terms and subject to the conditions set forth herein and in accordance
with the applicable provisions of the General Corporation Law of the State of
Delaware (the &quot;<U>DGCL</U>&quot;) and Certificate of Incorporation (as
defined below);</P>
<P>WHEREAS, the Merger and this Agreement require the vote of the holders of a
majority of the outstanding shares of the Company Common Stock for the approval
thereof (the &quot;<U>Company Stockholder Approval</U>&quot;);</P>
<P>WHEREAS, Parent, Merger Sub and the Company desire to make certain
representations, warranties, covenants and agreements in connection with the
Merger and also to prescribe various conditions to the Merger; and</P>
<P>WHEREAS, for federal income tax purposes, it is intended that the Merger
shall qualify as a reorganization within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended (the &quot;<U>Code</U>&quot;).</P>
<P>NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein contained, and intending to be legally bound hereby, the
parties hereto hereby agree as follows:</P>
<OL TYPE="I">

<P ALIGN="CENTER"><LI><A NAME="_Toc516304916"><A NAME="_Toc516304967"><U><BR>
<BR>
<A NAME="_Toc516396237"><A NAME="_Toc516438401"><A NAME="_Toc517021604">THE
MERGER</A></A></A></A></A></LI></P>
<OL>

<OL>

<LI><A NAME="_Toc516304917"><A NAME="_Toc516304968"><A NAME="_Toc516396238"><A
NAME="_Toc516438402"><A NAME="_Toc517021605">The
Merger</A></A>.</A></A></A></LI>
</U><P>  Upon the terms and subject to the conditions set forth in this
Agreement, and in accordance with the DGCL, Merger Sub shall be merged with and
into the Company at the Effective Time.  At the Effective Time, the separate
corporate existence of Merger Sub shall cease, and the Company shall continue as
the surviving corporation (hereinafter sometimes referred to as the
&quot;<U>Surviving Company</U>&quot;).</P>
<LI><A NAME="_Toc516304918"><A NAME="_Toc516304969"><A NAME="_Toc516396239"><A
NAME="_Toc516438403"><A
NAME="_Toc517021606"><U>Closing</A></A>.</A></A></A></LI>
</U><P>  Unless this Agreement shall have been terminated and the Merger and the
other transactions contemplated by this Agreement (collectively, the
&quot;<U>Transactions</U>&quot;) shall have been abandoned pursuant to Section
8.01, and subject to the satisfaction or waiver of the conditions set forth in
Article VI, the closing of the Merger (the &quot;<U>Closing</U>&quot;) will take
place at 10:00 a.m. on the second business day after satisfaction of the
conditions set forth in Section 6.01 (or as soon as practicable thereafter
following satisfaction or waiver of the conditions set forth in Sections 6.02
and 6.03) (the &quot;<U>Closing Date</U>&quot;), at the offices of Simpson
Thacher &amp; Bartlett, 3330 Hillview Avenue, Palo Alto, California 94304,
unless another date, time or place is agreed to in writing by the parties
hereto.</P>
<LI><A NAME="_Toc516304919"><A NAME="_Toc516304970"><A NAME="_Toc516396240"><A
NAME="_Toc516438404"><A NAME="_Toc517021607"><U>Effective Time of the
Merger</A></A>.</A></A></A></LI>
</U><P>  On the Closing Date, the parties shall cause the Merger to be
consummated by filing with the Secretary of State of the State of Delaware a
certificate of merger as contemplated by the DGCL (the &quot;<U>Certificate of
Merger</U>&quot;) executed in accordance with the relevant provisions of the
DGCL and shall make all other filings or recordings required under the DGCL to
be filed on such date.  The Merger shall become effective at such time (the
&quot;<U>Effective Time</U>&quot;) as the Certificate of Merger is duly filed
with the Secretary of State of the State of Delaware, or at such other time as
is permissible in accordance with the DGCL and as Merger Sub and the Company
shall agree should be specified in the Certificate of Merger.</P>
<LI><A NAME="_Toc516304920"><A NAME="_Toc516304971"><A NAME="_Toc516396241"><A
NAME="_Toc516438405"><A NAME="_Toc517021608"><U>Effects of the
Merger</A></A>.</A></A></A></LI>
</U><P>  At the Effective Time, the Merger shall have the effects set forth in
this Agreement, the Certificate of Merger and the applicable provisions of the
DGCL.  Without limiting the generality of the foregoing, and subject thereto, at
the Effective Time (a) the Surviving Company shall possess all rights,
privileges, powers and franchises, both public and private, and all of the
property, real, personal, and mixed of each of the Company and Merger Sub and
all obligations belonging to or due to Merger Sub or the Company, all of which
shall be vested in the Surviving Company without any further act or deed; and
(b) the Surviving Company shall be liable for all the obligations of Merger Sub
and the Company.</P>
<LI><A NAME="_Toc516304921"><A NAME="_Toc516304972"><A NAME="_Toc516396242"><A
NAME="_Toc516438406"><A NAME="_Toc517021609"><U>Certificate of Incorporation;
By-laws</A></A></U>.</A></A></LI>
<P></A>  (a)  At the Effective Time, and without any further action on the part
of the Company or Merger Sub, the certificate of incorporation of the Company,
as in effect at the Effective Time, shall be the certificate of incorporation of
the Surviving Corporation until thereafter amended as provided therein or by the
DGCL.</P>
<P>(b)&#9;At the Effective Time, and without any further action on the part of
the Company or Merger Sub, the by-laws of Merger Sub as in effect at the
Effective Time shall be the by-laws of the Surviving Corporation until
thereafter changed or amended as provided therein or by the DGCL.</P>
<LI><A NAME="_Toc516304922"><A NAME="_Toc516304973"><A NAME="_Toc516396243"><A
NAME="_Toc516438407"><A
NAME="_Toc517021610"><U>Directors</A></A></U>.</A></A></A></LI>
<P>  The directors of Merger Sub at the Effective Time shall be the directors of
the Surviving Corporation, until the earlier of their resignation or removal or
until their respective successors are duly elected and qualified, as the case
may be.</P>
<LI><A NAME="_Toc516396244"><A NAME="_Toc516438408"><A
NAME="_Toc517021611"><U>Officers</U>.</A></A></A></LI>
<P>  The officers of the Company at the Effective Time shall be the officers of
the Surviving Corporation, until the earlier of their resignation or removal or
until their respective successors are duly elected and qualified, as the case
may be.</P>
<LI><A NAME="_Toc516304925"><A NAME="_Toc516304976"><A NAME="_Toc516396245"><A
NAME="_Toc516438409"><A NAME="_Toc517021612"><U>Effect on Capital
Stock</A></A></U>.</A></A></A></LI>
<P>  As of the Effective Time, by virtue of the Merger and without any action on
the part of the Company, Merger Sub or any holder of any shares of Company
Common Stock or any shares of capital stock of Merger Sub:</P>
<OL TYPE="a">

<U><LI>Common Stock of Merger Sub</U>.  Each share of common stock of Merger Sub
issued and outstanding immediately prior to the Effective Time shall be
converted into one share of the common stock, par value $.01 per share, of the
Surviving Corporation with the same rights, powers and privileges as the shares
so converted and shall constitute the only outstanding shares of capital stock
of the Surviving Corporation;  </LI>
<U><LI>Cancellation of Treasury Stock and Parent-Owned Company Common Stock</U>.
Each share of Company Common Stock that is owned by the Company, Parent or
Merger Sub shall automatically be cancelled and retired and shall cease to
exist, and no cash, Parent Common Stock or other consideration shall be
delivered or deliverable in exchange therefore; and</LI>
<U><LI>Conversion of Company Common Stock</U>.  Subject to the provisions of
Section 1.09(e) hereof, each issued and outstanding share of Company Common
Stock (other than shares cancelled pursuant to Section 1.08(b) hereof) shall be
converted into a fractional number of shares of Applera Corporation -Celera
Genomics Group Common Stock, par value $.01 per share (including the rights
associated with such shares pursuant to Parent's Shareholders' Protection Rights
Plan) (the &quot;<U>Parent Common Stock</U>&quot;) equal to the Exchange Ratio
(the amount of Parent Common Stock into which each such share of Company Common
Stock is converted, together with the cash amount referenced in
Section&nbsp;1.09(e) being referred to herein as the &quot;<U>Merger
Consideration</U>&quot;).  As used herein, &quot;<U>Exchange Ratio</U>&quot;
means the following: </LI>
<OL TYPE="i">

<FONT FACE="Times"><LI>if the Parent Common Stock Price is equal to or greater
than $45.77 and less than or equal to $48.23 then the Exchange Ratio will mean
0.1016;</LI>
<LI>if the Parent Common Stock Price is greater than $48.23 then the Exchange
Ratio will mean $4.90 divided by the Parent Common Stock Price, but in no event
shall the Exchange Ratio be less than 0.0813;</LI>
<LI>if the Parent Common Stock Price is less than $45.77, then the Exchange
Ratio will mean $4.65 divided by the Parent Stock Price, but in no event shall
the Exchange Ratio be greater than 0.1355.</LI></OL>

</FONT><P>As used herein, &quot;<U>Parent Common Stock Price</U>&quot; means the
average of the closing sales prices of Parent Common Stock on the New York Stock
Exchange (the &quot;<U>NYSE</U>&quot;) Composite Transactions Tape (as reported
by <U>The Wall Street Journal</U>, or, if not reported thereby, as reported by
any other authoritative source) on each of the 10 consecutive trading days
immediately preceding the second trading day prior to the Effective Time.</P>
<U><LI>Cancellation and Retirement of Company Common Stock</U>.  As of the
Effective Time, all shares of Company Common Stock issued and outstanding
immediately prior to the Effective Time shall no longer be outstanding and shall
automatically be cancelled and retired and shall cease to exist, and each holder
of a certificate representing any such shares of Company Common Stock
(collectively, the &quot;<U>Certificates</U>&quot;) shall, to the extent such
Certificate represents such shares, cease to have any rights with respect
thereto, except the right to receive the Merger Consideration (including cash in
lieu of fractional shares of Parent Common Stock pursuant to Section 1.09(e)
hereof) to be issued or paid in consideration therefor upon surrender of such
certificate in accordance with Section 1.09 hereof.</LI></OL>

<LI><A NAME="_Toc516304926"><A NAME="_Toc516304977"><A NAME="_Toc516396247"><A
NAME="_Toc516438410"><A NAME="_Toc517021613"><U>Exchange of
Certificates</A></A></U>.</A></A></A></LI></OL>
</OL>
</OL>

<P>    <U>Exchange Agent</U>.  As of or as soon as reasonably practicable after
the Effective Time, Parent shall enter into an agreement with such bank or trust
company as may be designated by Parent (the &quot;<U>Exchange Agent</U>&quot;)
which shall provide that Parent shall deposit with the Exchange Agent, for the
benefit of the holders of Certificates, for exchange in accordance with this
Article I, certificates representing the shares of Parent Common Stock, together
with any dividends or distributions with respect thereto with a record date
after the Effective Time, and any cash payable in lieu of any fractional shares
of Parent Common Stock (such shares of Parent Common Stock and cash being
hereinafter referred to as the &quot;<U>Exchange Fund</U>&quot;) issuable
pursuant to Section 1.08 in exchange for outstanding shares of Company Common
Stock. </P>
<OL START=2 TYPE="a">
<DIR>
<DIR>

<OL TYPE="a">

<U><LI>Exchange Procedures</U>.  As soon as reasonably practicable after the
Effective Time, the Exchange Agent shall mail to each holder of record of
Certificates immediately prior to the Effective Time whose shares were converted
into shares of Parent Common Stock pursuant to Section 1.08, (i)&nbsp;a letter
of transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon delivery of the
Certificates to the Exchange Agent, and which shall be in customary form and
have such other provisions as Parent may reasonably specify and be reasonably
acceptable to the Company) and (ii)&nbsp;instructions for use in effecting the
surrender of the Certificates in exchange for certificates representing shares
of Parent Common Stock.  Upon surrender of a Certificate for cancellation to the
Exchange Agent together with such letter of transmittal, duly executed, the
holder of such Certificate shall be entitled to receive in exchange therefor a
certificate representing that number of whole shares of Parent Common Stock
which such holder has the right to receive in respect of the Certificate
surrendered pursuant to the provisions of this Article I (after taking into
account all shares of Company Common Stock then held by such holder), certain
dividends and other distributions in accordance with Section 1.09(c) hereof and
cash in lieu of any fractional shares in accordance with Section 1.09(e) hereof,
and the Certificate so surrendered shall forthwith be cancelled.  In the event
of a transfer of ownership of shares of Company Common Stock which is not
registered in the transfer records of the Company, a certificate representing
the proper number of shares of Parent Common Stock may be issued to a transferee
if the Certificate is presented to the Exchange Agent, accompanied by all
documents required to evidence and effect such transfer and by evidence that any
applicable stock transfer taxes have been paid.  Until surrendered as
contemplated by this Section 1.09 each Certificate shall be deemed at any time
after the Effective Time to represent only the right to receive upon such
surrender Parent Common Stock into which the shares of Company Common Stock
represented by such Certificate have been converted as provided in this Article
I and the right to receive upon such surrender cash in lieu of any fractional
shares of Parent Common Stock as contemplated by this Section 1.09.</LI>
<U><LI>Distributions with Respect to Unexchanged Shares</U>.  No dividends or
other distributions with respect to Parent Common Stock with a record date after
the Effective Time shall be paid to the holder of any unsurrendered Certificate
with respect to the shares of Parent Common Stock represented thereby, and no
cash payment in lieu of fractional shares shall be paid to any such holder
pursuant to Section 1.09(e) until the surrender of such Certificate in
accordance with this Article I.  Subject to the effect of applicable laws,
following surrender of any such Certificate, there shall be issued or paid to
the holder of such certificate, a certificate representing the number of whole
shares of Parent Common Stock issued in exchange therefor without interest,
(i)&nbsp;at the time of such surrender, the amount of any cash payable in lieu
of a fractional share of Parent Common Stock to which such holder is entitled
pursuant to Section 1.09(e) and the amount of any dividends or other
distributions with a record date after the Effective Time theretofore paid (but
withheld pursuant to the immediately preceding sentence) with respect to such
whole shares of Parent Common Stock, and (ii)&nbsp;at the appropriate payment
date, the amount of any dividends or other distributions with a record date
after the Effective Time but prior to such surrender and a payment date
subsequent to such surrender payable with respect to such whole shares of Parent
Common Stock.</LI>
<U><LI>No Further Ownership Rights in Company Common Stock</U>.  All shares of
Parent Common Stock issued upon conversion of shares of Company Common Stock in
accordance with the terms hereof, and all cash paid pursuant to Sections 1.09(c)
and 1.09(e) hereof, shall be deemed to have been issued in full satisfaction of
all rights pertaining to such shares of Company Common Stock (including with
respect to the rights to acquire one one-hundredth of a share of Series A Junior
Participating Preferred Stock of the Company (the &quot;<U>Rights</U>&quot;)
issued pursuant to the Rights Agreement dated as of October 8, 1998, as amended,
between the Company and Computershare Investor Services, L.L.C., as rights agent
(the &quot;<U>Rights Agreement</U>&quot;)), and there shall be no further
registration of transfers on the stock transfer books of the Surviving
Corporation of the shares of Company Common Stock that were outstanding prior to
the Effective Time.  If, after the Effective Time, Certificates are presented to
the Surviving Corporation for any reason, they shall be cancelled and exchanged
as provided in this Article I.</LI>
<U><LI>No Fractional Shares</U>.</LI>
<P>    No certificates or scrip representing fractional shares of Parent Common
Stock shall be issued upon the surrender for exchange of Certificates, and such
fractional share interests will not entitle the owner thereof to vote or to any
rights of a stockholder of Parent.  In lieu of such issuance of fractional
shares, the Exchange Agent shall pay each holder of Certificates an amount in
cash equal to the product obtained by multiplying (A) the fractional share
interest to which such holder (after taking into account all shares of Company
Common Stock held immediately prior to the Effective Time by such holder) would
otherwise be entitled by (B) the Parent Common Stock Price.</P>
<P>(ii)&nbsp; &#9;As soon as practicable after the determination of the amount
of cash, if any, to be paid to holders of Certificates with respect to any
fractional share interests, the Exchange Agent shall make available such amounts
to such holders of Certificates, subject to and in accordance with the terms of
Section 1.09(c).</P>
<U><LI>Termination of Exchange Fund</U>.  Any portion of the Exchange Fund
deposited with the Exchange Agent pursuant to this Section 1.09 which remains
undistributed to the holders of the Certificates for six months after the
Effective Time shall be delivered to the Parent, upon demand, and any holders of
Certificates prior to the Merger who have not theretofore complied with this
Article I shall thereafter look only to the Parent and only as general creditors
thereof for payment of their claim for Parent Common Stock, cash in lieu of
fractional shares of Parent Common Stock and any dividends or distributions with
respect to Parent Common Stock to which such holders may be entitled.</LI>
<U><LI>No Liability</U>.  None of Parent, Merger Sub, the Company or the
Exchange Agent shall be liable to any individual, corporation, limited liability
company, partnership, association, trust, unincorporated organization, other
entity or group (as defined in Section&nbsp;13(d)(3) of the Exchange Act) (a
&quot;<U>Person</U>&quot;) in respect of any shares of Parent Common Stock (or
dividends or distributions with respect thereto) or cash from the Exchange Fund
delivered to a public official pursuant to any applicable abandoned property,
escheat or similar law.  If any Certificates shall not have been surrendered
prior to three years after the Effective Time, or immediately prior to such
earlier date on which any Merger Consideration, or any dividends or
distributions with respect to Parent Common Stock would otherwise escheat to or
become the property of any Governmental Entity, any such Merger Consideration or
cash shall, to the extent permitted by applicable law, become the property of
the Surviving Corporation, free and clear of all claims or interest of any
Person previously entitled thereto.</LI>
<U><LI>Investment of Exchange Fund</U>.  The Exchange Agent shall invest any
cash included in the Exchange Fund, as directed by Parent on a daily basis.  Any
interest and other income resulting from such investments shall be paid to
Parent.  </LI>
<U><LI>Withholding of Tax</U>.  Parent or the Exchange Agent will be entitled to
deduct and withhold from the Merger Consideration otherwise payable pursuant to
this Agreement to any holder of Company Common Stock such amounts as Parent (or
any Affiliate thereof) or the Exchange Agent are required to deduct and withhold
with respect to the making of such payment under the Code, or any applicable
provision of U.S. federal, state, local or non-U.S. tax law.  To the extent that
such amounts are properly withheld by Parent or the Exchange Agent, such
withheld amounts will be treated for all purposes of this Agreement as having
been paid to the holder of the Company Common Stock in respect of whom such
deduction and withholding were made by Parent or the Exchange Agent.</LI>
<U><LI>Lost Certificates</U>.  If any Certificate shall have been lost, stolen
or destroyed, upon the making of any affidavit of that fact by the Person
claiming such Certificate to be lost, stolen or destroyed, the indemnification
by such Person of the Surviving Company and, if required by the Surviving
Company, the posting by such Person of a bond in such reasonable amount as the
Surviving Company may direct as indemnity against any claim that may be made
against it with respect to such Certificate, the Exchange Agent will deliver in
exchange for such lost, stolen or destroyed Certificate the applicable Merger
Consideration with respect to the shares of Company Common Stock formerly
represented thereby.</LI></OL>
</DIR>
</DIR>
</OL>

<OL>
<OL>

<OL>

<LI><A NAME="_Toc516304927"><A NAME="_Toc516304978"><A NAME="_Toc516396248"><A
NAME="_Toc516438411"><A NAME="_Toc517021614"><U>Treatment of
Options</U><I>.</A></A></A></A></A></LI></OL>
</OL>
</OL>

</I><P>  (a)  At the Effective Time, each outstanding option to purchase Company
Common Stock (a &quot;<U>Company Stock Option</U>&quot;) issued pursuant to the
Company's 1989 Stock Option Plan, 1997 Equity Incentive Plan and 1997 Non-
Officer Equity Incentive Plan (collectively with the 1994 Non-Employee
Directors' Stock Option Plan, the &quot;<U>Company Stock Plans</U>&quot;),
whether vested or unvested, shall be converted into an option (a &quot;<U>Parent
Stock Option</U>&quot;) to acquire, on the same terms and conditions as were
applicable under such Company Stock Option, a number of shares of Parent Common
Stock equal to (1) the number of shares of Company Common Stock subject to such
Company Stock Option multiplied by (2) the Exchange Ratio, rounded down to the
nearest whole share, at a price per share equal to (x)&nbsp;the exercise price
per share for such Company Stock Option divided by (y) the Exchange Ratio,
rounded up to the nearest whole cent; <U>provided</U>, <U>however</U>, <A
NAME="_DV_C3">that the exercise price per share of each Parent Stock Option held
by an individual who is an employee of or consultant to the Company or any
Subsidiary as of the Effective Time will not exceed the closing price of a share
of Parent Common Stock on the NYSE Composite Transaction Tape on the date
immediately prior to the Closing Date</A>.</P>
<OL START=2 TYPE="a">
<OL START=2 TYPE="a">
<OL START=2 TYPE="a">

<LI>Prior to the Effective Time, the board of directors of Parent and its
compensation committee, as applicable, shall take all necessary action to assume
and adopt, as of the Effective Time, the Company's 1997 Equity Incentive Plan,
and shall have the discretion to assume and adopt, as of the Effective Time,
each other Company Stock Plan in which a Parent Stock Option is outstanding
following the Effective Time and which has not terminated by its terms.  Within
ten (10) business days after the Effective Time, Parent shall deliver to the
holders of Company Stock Options appropriate notices pursuant to the Company
Stock Plans.  If necessary, Parent shall comply with the terms of the Company
Stock Plans and ensure, to the extent required by, and subject to the provisions
of, the Company Stock Plans and applicable law, that Company Stock Options that
qualified as incentive stock options prior to the Effective Time continue to
qualify as incentive stock options after the Effective Time.</LI>
<LI>Parent shall take all corporate action necessary to reserve for issuance a
sufficient number of shares of Parent Common Stock for delivery upon exercise of
Parent Stock Options.  No later than five business days after the Effective
Time, Parent shall file a registration statement on Form S-3 or Form S-8, as the
case may be (or any successor or other appropriate forms), or another
appropriate form, with respect to the shares of Parent Common Stock subject to
such options to the fullest extent permitted by law and shall use its reasonable
best efforts to maintain the effectiveness of such registration statement or
registration statements (and maintain the current status of the prospectus or
prospectuses contained therein) for so long as such options remain
outstanding.</LI>
<LI>Each outstanding purchase right under the Stock Purchase Plan shall be
exercised for the purchase of shares of Company Common Stock at the price per
share determined pursuant to the Stock Purchase Plan on the date immediately
prior to the Closing Date, pursuant to Section 12(b)(iii) of the Stock Purchase
Plan (the &quot;<U>Final Offering Period</U>&quot;).  Immediately following the
Final Offering Period and upon or prior to the Effective Time, the Company shall
take all action necessary to provide that the Stock Purchase Plan shall be
terminated and that no Person has any further right to purchase Company Common
Stock under the Stock Purchase Plan.</LI></OL>
</OL>
</OL>

<OL>
<OL>

<OL>

<LI><A NAME="_Toc516304928"><A NAME="_Toc516304979"><A NAME="_Toc516396249"><A
NAME="_Toc516438412"><A NAME="_Toc517021615"><U>Treatment of Debt Securities,
Convertible Notes and Company Warrants</U><I>.</A></A></A></A></A></LI></OL>
</OL>
</OL>

</I><P>  (a)  All debt securities of the Company that are outstanding as of the
Effective Time shall remain outstanding after the Effective Time in accordance
with their respective terms and provisions.  Pursuant to the Indenture, dated as
of September 22, 2000 (the &quot;<U>Indenture</U>&quot;) between the Company and
U.S. Bank Trust National Association, as trustee (the
&quot;<U>Trustee</U>&quot;) and to Section 8.04 of the First Supplemental
Indenture, dated as of September&nbsp;22, 2000 (together with the Indenture, the
&quot;<U>Convertible Notes Indenture</U>&quot;), between the Company and the
Trustee relating to the Company's 8% Senior Secured Convertible Notes (the
&quot;<U>Convertible Notes</U>&quot;), prior to the Effective Time, the Company
and Parent shall enter into an agreement providing that (i) each holder of
Convertible Notes outstanding at the Effective Time shall have the right to
convert such Convertible Notes into the number of shares of Parent Common Stock
which would be receivable at the Effective Time by a holder of the number of
shares of Company Common Stock deliverable upon conversion of such Convertible
Notes immediately prior to the Effective Time, and subject to future adjustments
of the conversion price of the Convertible Notes as provided for in Section 8.03
of the Supplemental Indenture and (ii) Parent shall be jointly and severally
liable with the Company for the payment and performance by the Company of all of
the Company's obligations under the Convertible Notes Indenture, the Notes, the
related note purchase agreements and warrants and the other agreements,
instruments and documents contemplated thereby.</P>
<OL START=2 TYPE="a">
<OL START=2 TYPE="a">

<OL TYPE="a">

<LI>At the Effective Time, each of the warrants to purchase shares of Company
Common Stock (the &quot;<U>Company Warrants</U>&quot;) which is outstanding and
unexercised immediately prior thereto shall, pursuant to the terms of such
Company Warrant, cease to represent a right to acquire shares of Company Common
Stock and shall be converted automatically into a warrant to purchase such
number of shares of Parent Common Stock as the holder of such Company Warrant
would have been entitled to receive pursuant to the Merger had such holder
exercised such warrant in full immediately prior to the Effective Time, at a
price per share equal to (y) the aggregate exercise price for the shares of
Company Common Stock otherwise purchasable pursuant to such Company Warrant
divided by (z) the number of full shares of Parent Common Stock deemed
purchasable pursuant to such Company Warrant, and subject to future adjustments
in accordance with the terms of such Company Warrant, <U>provided</U>
<U>however</U> that with respect to the Company Warrants issued to members of
Reedland Capital Partners, if the value of Parent Common Stock issuable with
respect to one share of Company Common Stock immediately prior to the Effective
Time is greater than the stock purchase price as defined in such Company
Warrants effective at the Effective Time (which price as defined in such Company
Warrants is currently $4.0625), such Company Warrants will expire unless
exercised prior to the Effective Time.  </LI>
<LI>Prior to the Effective Time, the Company shall deliver to the holders of
Convertible Notes and Company Warrants appropriate notices (in form and
substance reasonably satisfactory to Parent) setting forth such holders' rights
pursuant to the Convertible Notes Indenture and the applicable warrant
agreements with respect thereto to the extent required by the terms of the
Convertible Notes Indenture and the applicable warrant agreements.</LI>
<LI>Parent shall take all corporate action necessary to reserve for issuance a
sufficient number of shares of Parent Common Stock for delivery upon conversion
of the Convertible Notes and exercise of the Company Warrants. </LI></OL>
</OL>
</OL>

<OL TYPE="I">

<P ALIGN="CENTER"><LI><A NAME="_Toc516304929"><A NAME="_Toc516304980"><U><BR>
<BR>
<A NAME="_Toc516396250"><A NAME="_Toc516438413"><A
NAME="_Toc517021616">REPRESENTATIONS AND WARRANTIES</A></A></A> OF THE
COMPANY</A></A></LI></P>
</U><P>Except as set forth in the written disclosure schedule dated as of the
date of this Agreement and previously delivered by the Company to Parent (the
&quot;<U>Company Disclosure Schedule</U>&quot;) (it being understood that the
Company Disclosure Schedule shall be arranged in sections corresponding to the
sections contained in this Agreement, and the disclosures in any section of the
Company Disclosure Schedule shall qualify the representations in the
corresponding section of this Article II and all applicable representations in
other sections of this Article&nbsp;II to the extent that such qualification is
readily apparent), the Company hereby represents and warrants to Parent and
Merger Sub as follows:</P>
<OL>

<OL>

<LI><A NAME="_Toc516396251"><A NAME="_Toc516438414"><A
NAME="_Toc517021617"><U>Organization, Standing and Corporate
Power.</A></A></A></LI>
</U><P>  Each of the Company and each of its Subsidiaries is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation and has the requisite corporate and authority necessary to own,
lease and operate its properties and to carry on its business as it is now being
conducted.  Each of the Company and each of its Subsidiaries is duly qualified
or licensed as a foreign corporation or entity to do business, and is in good
standing, in each jurisdiction where the character of its properties owned,
leased or operated by it or the nature of its activities makes such
qualification or licensing necessary, except where the failure to be so duly
qualified or licensed and in good standing would not, individually or in the
aggregate, reasonably be expected to have any materially adverse effect on the
business, assets, liabilities, financial condition or results of operations of
the Company and its Subsidiaries taken as a whole other than any such effect
resulting from any change, effect, event, occurrence, state of facts or
development relating to the industry in which the Company operates in general
and not specifically relating to the Company or on the ability of the Company to
perform its obligations under this Agreement (a &quot;<U>Company Material
Adverse Effect</U>&quot;).  Attached to Section 2.01 of the Company Disclosure
Schedule are complete and correct copies of the Company's certificate of
incorporation, as amended (the &quot;<U>Certificate of Incorporation</U>&quot;),
and the Company's by-laws, as amended (the &quot;<U>By-Laws</U>&quot;), as
currently in effect.</P>
<LI><A NAME="_Toc516396252"><A NAME="_Toc516438415"><A
NAME="_Toc517021618"><U>Subsidiaries and Minority Investments.</A></A></A></LI>
</U><P>  (a)  Section 2.02 of the Company Disclosure Schedule sets forth a list
of (i)&nbsp;all Subsidiaries of the Company together with the jurisdiction of
incorporation or formation of each such Subsidiary and the percentage of each
class or type of each such Subsidiary's outstanding Equity Interests owned by
the Company or another Subsidiary of the Company and (ii)&nbsp;all Minority
Investments of the Company together with the percentage of each class or type of
outstanding Equity Interests owned by the Company or another Subsidiary of the
Company.  Section 2.02 of the Company Disclosure Schedule identifies
(i)&nbsp;the certificates of incorporation and by-laws (or equivalent
organizational documents) of, and any investor rights, voting, co-sale or other
similar agreements applicable to, each of its Subsidiaries (the
&quot;<U>Subsidiary Documents</U>&quot;) and (ii)&nbsp;any investor rights,
voting, co-sale or other agreements to which the Company or its Subsidiaries are
party and, to the Knowledge of the Company, the certificates of incorporation
and by-laws (or equivalent organizational documents), in each case with respect
to each of its Minority Investments (the &quot;<U>Minority Investment
Documents</U>&quot;), and the Company has heretofore made available to Parent a
true and correct copy of each such Subsidiary Document and Minority Investment
Document.  Such Subsidiary Documents and Minority Investment Documents are in
full force and effect and no other charter or organizational documents or
investor rights, voting, co-sale or other similar agreements are applicable to
or binding on the Company or its Subsidiaries with respect to the Equity
Interests of the Subsidiaries or Minority Investments.  None of the Company's
Subsidiaries nor, to the knowledge of the employees of the Company set forth on
Schedule 2.02 hereto (the &quot;<U>Knowledge of the Company</U>&quot;), any
Minority Investment is in violation of any provision of its certificate of
incorporation of bylaws or equivalent organizational documents.  Neither the
Company nor any Subsidiary owns any Equity Interests in any Person other than
the Subsidiaries and the Minority Investments.  All of the outstanding Equity
Interests of the Company's Subsidiaries owned by the Company or its Subsidiaries
are duly authorized, validly issued, fully-paid and nonassessable, and all such
Equity Interests and all of the Equity Interests of the Minority Investments
owned or held by the Company or its Subsidiaries are owned by the Company or
another Subsidiary of the Company, free and clear of all security interests,
liens, claims, pledges, charges or other encumbrances of any nature whatsoever
(&quot;<U>Liens</U>&quot;) or any restriction on the right to vote, sell or
otherwise dispose of such Equity Interests and were issued in compliance with
all applicable federal and state securities Laws.</P>
<P>(b)&#9;As used herein: (i)&nbsp;&quot;<U>Subsidiary</U>&quot; of the Company
or any other Person means any corporation, limited liability company,
partnership, joint venture or other entity of which the Company or such other
Person, as the case may be (either alone or through or together with any other
Subsidiaries), (A) owns, directly or indirectly, 50% or more of the stock or
other interests the holders of which are generally entitled to vote for the
election of the board of directors or other governing body of such Person (or,
if there are no such voting interests, 50% or more of the Equity Interests) or
(B) serves as a general partner or managing member; (ii)&nbsp;&quot;<U>Equity
Interest</U>&quot; means with respect to any Person, any and all shares,
interests, participations, rights in, or other equivalents (however designated
and whether voting or non-voting) of, such Person's capital stock or other
equity interests (including, without limitation, partnership or membership
interests in a partnership or limited liability company or any other interest or
participation that confers on a Person the right to receive a share of the
profits and loss, or distributions of assets, of the issuing Person) whether
outstanding on the date hereof or issued after the date hereof, and any and all
warrants, options or other rights to acquire (including without limitation, any
securities convertible into or exchangeable for) any such Equity Interests; and
(iii)&nbsp;&quot;<U>Minority Investment</U>&quot; of the Company or any other
Person means any corporation, limited liability company, partnership, joint
venture or other entity of which the Company or such other Person, as the case
may be (either alone or through or together with any other Subsidiary), owns,
directly or indirectly, more than 5% of the Equity Interests but which is not a
Subsidiary of the Company or such other Person.</P>
<LI><A NAME="_Toc516396253"><A NAME="_Toc516438416"><A
NAME="_Toc517021619"><U>Capital Structure.</A></A></A></LI>
</U><P>  (a)  The authorized capital stock of the Company consists of
100,000,000 shares of Company Common Stock, par value $.001 per share, and
10,000,000 shares of Company Preferred Stock, par value $.001 per share.  As of
the close of business on June 7, 2001, there were: (i)&nbsp;40,048,880 shares of
Company Common Stock issued and outstanding; (ii)&nbsp;9,886 shares of Company
Common Stock held in the treasury of the Company and no shares of Company Common
Stock held by Subsidiaries of the Company; (iii)&nbsp;10,644,566 shares of
Company Common Stock reserved for issuance upon exercise of Company Stock
Options available for grant pursuant to the Company Stock Plans;
(iv)&nbsp;5,260,447 shares of Company Common Stock issuable upon exercise of
awarded but unexercised Company Stock Options, with an exercise price per each
awarded but unexercised Company Stock Option as set forth in the Company
Disclosure Schedule; (v)&nbsp;289,532 shares of Company Common Stock reserved
for issuance pursuant to the Company's Employee Stock Purchase Plan (the
&quot;<U>Stock Purchase Plan</U>&quot;); (vi)&nbsp;1,899,234 shares of Company
Common Stock issuable upon exercise of Company Warrants then outstanding and
with an exercise price for each such Company Warrant as is set forth in the
Company Disclosure Schedule; (vii)&nbsp;3,682,720 shares of Company Common Stock
issuable upon conversion of the Convertible Notes (for which Convertible Notes
the conversion price under the Convertible Notes Indenture is $7.06);
(viii)&nbsp;no shares of Preferred Stock issued and outstanding; (ix) 500,000
shares of Series A Junior Participating Preferred Stock reserved for issuance
pursuant to the Rights Agreement; and (x) no shares of Company Preferred Stock
in the treasury of the Company.  Except as set forth above, as of June&nbsp;7,
2001, there were no shares of capital stock or other equity securities of the
Company issued, reserved for issuance or outstanding.  </P>
<P>(b)&#9;All outstanding shares of capital stock of the Company are, and all
shares which may be issued pursuant to the Company Stock Plans and the Company
Warrants will be, when issued and paid for in accordance with the terms of the
Company Warrants and the Company Stock Plans, duly authorized, validly issued,
fully paid and nonassessable and not subject to preemptive rights.  All
securities issued by the Company were issued in compliance in all material
respects with all applicable federal and state securities laws and all
applicable rules and regulations promulgated thereunder.  No shares of capital
stock of the Company are owned by any Subsidiary of the Company.  </P>
<P>(c)&#9;Except as set forth in Section 2.03(a), there is no outstanding
Indebtedness of the Company having the right to vote (or convertible into, or
exchangeable for, securities having the right to vote) on any matters on which
stockholders of the Company may vote (collectively, &quot;<U>Voting
Debt</U>&quot;).  As used herein, &quot;<U>Indebtedness</U>&quot; means, with
respect to any Person, without duplication, (i)&nbsp;all obligations of such
Person for borrowed money, or with respect to deposits or advances of any kind
to such Person, (ii)&nbsp;all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (iii)&nbsp;all obligations of such
Person under conditional sale or other title retention agreements relating to
property purchased by such Person, (iv)&nbsp;all obligations of such Person
issued or assumed as the deferred purchase price of property or services
(excluding obligations of such Person to creditors for raw materials, inventory,
services and supplies incurred in the ordinary course of such Person's
business), (v)&nbsp;all capitalized lease obligations of such Person,
(vi)&nbsp;all obligations of others secured by any Lien on property or assets
(excluding encumbrances in the form of restrictions on use of Intellectual
Property contained in license agreements or scientific collaboration agreements)
owned or acquired by such Person, whether or not the obligations secured thereby
have been assumed, (vii)&nbsp;all obligations of such Person under interest rate
or currency hedging transactions (valued at the termination value thereof),
(viii)&nbsp;all letters of credit issued for the account of such Person and (ix)
all guarantees and arrangements having the economic effect of a guarantee of
such Person of any Indebtedness of any other Person.  Except as set forth in
Section 2.03(a), there are no options, warrants or other rights, agreements,
arrangements or commitments of any character binding on the Company or any of
its Subsidiaries relating to the issued or unissued Equity Interests of the
Company or any of its Subsidiaries or obligating the Company or any of its
Subsidiaries to issue, sell, repurchase, redeem or otherwise acquire or make any
payment with respect to any Equity Interests of the Company or any of its
Subsidiaries or any Minority Interests held by the Company or any of its
Subsidiaries.  To the Knowledge of the Company as of the date hereof, there are
no irrevocable proxies with respect to shares of capital stock of the Company or
any of its Subsidiaries.  There are no agreements or arrangements pursuant to
which the Company is or could be required to register shares of Company Common
Stock or other securities under the Securities Act of 1933, as amended (the
&quot;<U>Securities Act</U>&quot;).</P>
<P>(d)&#9;Between June 7, 2001 and the date of this Agreement, the Company has
not issued or reserved for issuance any Company Common Stock, Company Stock
Options or other Equity Interests of the Company, except (i)&nbsp;the issuance
of Company Common Stock as a result of the exercise of Company Stock Options
outstanding at June 7, 2001 and (ii)&nbsp;upon conversion or exercise of
Convertible Notes or Company Warrants outstanding on the date of this Agreement.
Between December 31, 2000 and the date of this Agreement, neither the Company
nor any of its Subsidiaries has (A) repurchased, redeemed or otherwise acquired
any Equity Interests of the Company or any of its Subsidiaries or (B) declared,
set aside, made or paid any dividend or distribution in respect of any of its
Equity Interests and the board of directors of the Company has not resolved to
do any of the foregoing.</P>
<LI><A NAME="_Toc516396254"><A NAME="_Toc516438417"><A
NAME="_Toc517021620"><U>Authority</U>.</A></A></A></LI>
<P>  The Company has all necessary corporate power and authority to execute and
deliver this Agreement and to perform its obligations hereunder and to
consummate the Transactions.   The execution and delivery of this Agreement by
the Company and the consummation by the Company of the Transactions have been
duly and validly authorized by all necessary corporate action of the Company
other than the adoption of this Agreement by the Company's stockholders in
accordance with the DGCL and the Certificate of Incorporation and Bylaws, and no
other corporate proceedings on the part of the Company are necessary to
authorize this Agreement or to consummate the Merger (other than the adoption of
this Agreement by the Company's stockholders in accordance with the DGCL and the
Certificate of Incorporation and Bylaws and the filing and recordation of the
appropriate documents with respect to the Merger in accordance with the DGCL).
This Agreement has been duly and validly executed and delivered by the Company
and, assuming the due authorization, execution and delivery hereof by Parent and
Merger Sub, constitutes the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except to the
extent limited by bankruptcy, insolvency, moratorium, fraudulent conveyance, or
other Laws affecting the rights of creditors generally, and to the extent that
the availability of equitable remedies may be limited by equitable principles.
</P>
<LI><A NAME="_Toc516396255"><A NAME="_Toc516438418"><A
NAME="_Toc517021621"><U>Noncontravention</U>.</A></A></A></LI>
<P>  (a)  The execution and delivery of this Agreement by the Company does not,
and the performance of this Agreement by the Company and the consummation of the
Transactions will not, (i)&nbsp;conflict with or violate the Certificate of
Incorporation or Bylaws or the certificate of incorporation or bylaws (or
equivalent formation documents) of each of the Subsidiaries of the Company,
(ii)&nbsp;assuming that all consents, approvals and authorizations contemplated
by clauses (i)-(iv), inclusive, of Section 2.05(b) hereof have been obtained and
all filings described in such clauses have been made (and declared effective, if
applicable), conflict with or violate any law, statute, ordinance, rule,
regulation, order, judgment or decree (collectively, &quot;<U>Laws</U>&quot;)
applicable to the Company or any of its Subsidiaries or, to the Knowledge of the
Company, any of its Minority Investments or by which any of their respective
properties is bound or affected, or (iii)&nbsp;result in any breach of or
constitute a default (or an event that 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 alteration of rights under or
require the consent or approval of any Person under, or result in the creation
of a 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, joint venture, limited liability
or partnership agreement or other instrument 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 is bound or affected, including any
Subsidiary Document and any Minority Investment Document, except, in the case of
clauses (ii)&nbsp;and (iii)&nbsp;of this Section 3.05(a), for any conflict,
violation, breach, default, impairment, right or lack of consent or approval
that would not, individually or in the aggregate, reasonably be expected to have
a Company Material Adverse Effect.  </P>
<P>(b)&#9;The execution and delivery of this Agreement by the Company does not,
and the performance of this Agreement by the Company and the consummation of the
Transactions by the Company will not, require any consent, approval,
authorization or permit of, or filing with or notification to, any federal,
state or local court or governmental or regulatory authority or agency, domestic
or foreign (each, a &quot;<U>Governmental Entity</U>&quot;), except (i)&nbsp;the
filing of a premerger notification and report form by the Company under the HSR
Act, (ii)&nbsp;the filing of the Certificate of Merger with the Secretary of
State of the State of Delaware and appropriate documents with the relevant
authorities of other states in which the Company is qualified to do business,
(iii)&nbsp;the filing with the Securities and Exchange Commission (the
&quot;<U>SEC</U>&quot;) of the Form S-4 and such reports under the Securities
Exchange Act of 1934, as amended, and the SEC rules and regulations promulgated
thereunder (the &quot;<U>Exchange Act</U>&quot;) as may be required in
connection with this Agreement and the Transactions, (iv)&nbsp;consents,
approvals, authorizations, permits, filings or notifications which have
heretofore been obtained or made, as the case may be, by the Company and are in
full force and effect or (v)&nbsp;where the failure to obtain such consents,
approvals, authorizations or permits, or to make such filings or notifications,
would not, individually or in the aggregate, reasonably be expected to have a
Company Material Adverse Effect.</P>
<LI><A NAME="_Toc516396256"><A NAME="_Toc516438419"><A
NAME="_Toc517021622"><U>SEC Documents; Financial
Statements</U>.</A></A></A></LI>
<P>  (a)  The Company has filed on a timely basis all forms, reports and
documents required to be filed with the SEC since January 1, 1998 (all forms,
reports and documents filed by the Company with the SEC since January 1, 1998,
in each case including all exhibits and schedules thereto and documents
incorporated by reference therein, such documents together with any documents
filed during such period by the Company with the SEC on a voluntary basis on
Current Reports on Form&nbsp;8-K are referred to herein as the &quot;<U>Company
SEC Documents</U>&quot;).  The Company SEC Documents (i)&nbsp;complied as to
form in all material respects with the requirements of the Securities Act of
1933, as amended, and the SEC rules and regulations promulgated thereunder (the
&quot;<U>Securities Act</U>&quot;) or the Exchange Act, as the case may be, and
the rules and regulations thereunder, each as in effect on the date so filed or
amended, and (ii)&nbsp;did not at the time they were filed (or if amended or
superseded by a filing then on the date of such filing, which filing must have
occurred prior to the date of this Agreement for the Company SEC Documents
otherwise filed prior to the date of this Agreement) contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.  </P>
<P>(b)&#9;Each of the audited and unaudited consolidated financial statements
(including, in each case, any related notes thereto) contained in the Company
SEC Documents were prepared in accordance with United States generally accepted
accounting principles (&quot;<U>GAAP</U>&quot;) applied on a consistent basis
throughout the periods involved (except as may be indicated in the notes thereto
or in the Company SEC Documents), and each fairly presents the consolidated
financial position of the Company and its Subsidiaries at the respective dates
thereof and the consolidated results of their operations and cash flows for the
periods indicated, except that the unaudited interim financial statements were
or are subject to normal and recurring year-end adjustments and do not contain
all of the footnote disclosures required by GAAP.  </P>
<LI><A NAME="_Toc516396257"><A NAME="_Toc516438420"><A
NAME="_Toc517021623"><U>Undisclosed Liabilities</U>.</A></A></A></LI>
<P>  Neither the Company nor any of its Subsidiaries has any liabilities or
obligations of any nature (whether accrued, absolute, contingent or otherwise)
required by GAAP to be recognized or disclosed on a consolidated balance sheet
of the Company and its Subsidiaries or in the notes thereto, except
(i)&nbsp;liabilities reflected in the consolidated audited balance sheet of the
Company as of December 31, 2000 or the notes thereto (the &quot;<U>2000 Balance
Sheet</U>&quot;) and (ii)&nbsp;liabilities incurred since December 31, 2000 in
the ordinary course of business consistent with past practice that, individually
or in the aggregate, would not reasonably be expected to have a Company Material
Adverse Effect.</P>
<LI><A NAME="_Toc516396258"><A NAME="_Toc516438421"><A
NAME="_Toc517021624"><U>Information Supplied</U>.</A></A></A></LI>
<P>  None of the information supplied or to be supplied by the Company for
inclusion or incorporation by reference in (i)&nbsp;the registration statement
on Form S-4 to be filed with the SEC by Parent in connection with the issuance
of Parent Common Stock in the Merger (the &quot;<U>Form S-4</U>&quot;), at the
time the Form S-4 is filed with the SEC, at any time it is amended or
supplemented or at the time it becomes effective under the Securities Act, or
(ii)&nbsp;the Proxy Statement, at the date it is first mailed to the Company's
stockholders or at the time of the Stockholders Meeting, will 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 therein, in the
light of the circumstances under which they are made, not misleading.  The Proxy
Statement will comply as to form in all material respects with the requirements
of the Exchange Act and the rules and regulations promulgated thereunder, except
that no representation is made by the Company with respect to statements made or
incorporated by reference therein based on information supplied in writing by
Parent or Merger Sub specifically for inclusion or incorporation by reference
therein.  </P>
<LI><A NAME="_Toc516396259"><A NAME="_Toc516438422"><A
NAME="_Toc517021625"><U>Absence of Certain Changes or
Events</U>.</A></A></A></LI>
<P>  Since December 31, 2000, the Company has conducted its business only in the
ordinary course consistent with past practice, and there is not and has not
been: (a) any condition, event or occurrence, individually or in the aggregate,
resulting in a Company Material Adverse Effect, (b) any condition, event or
occurrence which, individually or in the aggregate, would reasonably be expected
to have or give rise to a Company Material Adverse Effect; or (c) any action
which, if it had been taken or occurred after the execution of this Agreement,
would have required the consent of Parent pursuant to this Agreement.</P>
<LI><A NAME="_Toc516396260"><A NAME="_Toc516438423"><A
NAME="_Toc517021626"><U>Litigation</U>.</A></A></A></LI>
<P>There is no suit, claim, action, proceeding or investigation pending or, to
the Knowledge of the Company, threatened against the Company or any of its
Subsidiaries, or against or involving any properties or rights of the Company or
any of its Subsidiaries, which would, individually or in the aggregate,
reasonably be expected to result in a Company Material Adverse Effect.  Section
2.10 of the Company Disclosure Schedule sets forth as of the date of this
Agreement the suits, claims, actions, proceedings and investigations pending, or
to the Knowledge of the Company, threatened against the Company or any of its
Subsidiaries which if adversely determined would result in a liability to the
Company in excess of $500,000.  To the Knowledge of the Company, neither the
Company nor any of its Subsidiaries nor any of their respective properties is or
are subject to any order, writ, judgment, injunction, decree, determination or
award having, or which would reasonably be expected to have a Company Material
Adverse Effect.  To the Knowledge of the Company, as of the date of this
Agreement, no officer or director of the Company or any of its Subsidiaries has
been served with or otherwise has written notice of a written complaint naming
such officer or director as a defendant in any litigation commenced by
stockholders of the Company or any of its Subsidiaries with respect to the
performance of his or her duties as an officer and/or director of the Company or
any of its Subsidiaries under any federal or state Law (including litigation
under federal and state securities Laws).</P>
<LI><A NAME="_Toc516396261"><A NAME="_Toc516438424"><A
NAME="_Toc517021627"><U>Labor Matters</U>.</A></A></A></LI>
<P>  Neither the Company nor any of its Subsidiaries is a party to, or bound by,
any collective bargaining agreement, contract or other agreement or
understanding with a labor union or labor organization.  To the Knowledge of the
Company, neither the Company nor any of its Subsidiaries is the subject of any
proceeding asserting that it or any Subsidiary has committed an unfair labor
practice or seeking to compel it to bargain with any labor organization as to
wages or conditions of employment.  There is no strike, work stoppage, lock-out
or other similar labor dispute involving it or any of its Subsidiaries pending
or, to the Knowledge of the Company, threatened; and no employee grievance
pending or, to the Knowledge of the Company, threatened against the Company or
any of its Subsidiaries which, individually or in the aggregate, would
reasonably be expected to have a Company Material Adverse Effect.  The Company
and each Subsidiary is in compliance with all applicable Laws, agreements,
contracts, and policies relating to employment, employment practices, wages,
hours, and terms and conditions of employment except for failures so to comply,
if any, that individually or in the aggregate would not reasonably be expected
to have a Company Material Adverse Effect.  The Company and its Subsidiaries
have complied in all material respects with their payment obligations to all
employees of the Company and its Subsidiaries in respect of all wages, salaries,
commissions, bonuses, benefits and other compensation due and payable to such
employees under any Company policy, practice, agreement, plan, program or any
Law.  The Company and its Subsidiaries are not liable for any severance pay or
other payments to any employee or former employee arising from the termination
of employment under any benefit or severance policy, practice, agreement, plan,
or program of the Company or any of its Subsidiaries, nor to the Knowledge of
the Company will the Company or any of its Subsidiaries have any liability which
exists or arises, or may be deemed to exist or arise, under any applicable law
or otherwise, as a result of the Transactions.  The Company and its Subsidiaries
are in compliance with its obligations pursuant to the Worker Adjustment and
Retraining Notification Act of 1988 (&quot;<U>WARN</U>&quot;), to the extent
applicable.  Each employee of the Company or any of its Subsidiaries has signed
an agreement with respect to confidentiality, nonsolicitation and assignment of
inventions with the Company or such Subsidiary, which agreements are each in the
form heretofore provided to Parent. </P>
<LI><A NAME="_Toc516396262"><A NAME="_Toc516438425"><A
NAME="_Toc517021628"><U>Permits; Compliance with Laws</U>.</A></A></A></LI>
<P>  (a)  The Company and its Subsidiaries hold all permits, licenses,
variances, exemptions, orders and approvals of all Governmental Entities other
than those the failure of which to hold would not reasonably be expected to have
a Company Material Adverse Effect (the &quot;<U>Company Permits</U>&quot;).  The
Company and its Subsidiaries are in material compliance with the terms of the
Company Permits.  </P>
<P>(b)&#9;The businesses of the Company and its Subsidiaries are not being
conducted in violation of any law (domestic or foreign), ordinance or regulation
of any Governmental Entity, except for possible violations that, individually or
in the aggregate, do not and would not reasonably be expected to have a Company
Material Adverse Effect.</P>
<LI><A NAME="_Toc516396263"><A NAME="_Toc516438426"><A
NAME="_Toc517021629"><U>Employee Benefit Plans</U>.</A></A></A></LI></OL>
</OL>
</OL>

<P>  (a)  The Company Disclosure Schedule contains a true and complete list of
each &quot;employee benefit plan&quot; (within the meaning of section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended
(&quot;<U>ERISA</U>&quot;)) (including, without limitation, multiemployer plans
within the meaning of Section 3(37) of ERISA)), stock purchase, stock option,
severance, employment, change-in-control, fringe benefit, collective bargaining,
bonus, incentive, deferred compensation and all other employee benefit plans,
agreements, programs, policies or other arrangements relating to compensation,
benefits or entitlements, whether or not subject to ERISA (including any funding
mechanism therefor now in effect or required in the future as a result of the
Transactions or otherwise), whether formal or informal, oral or written, legally
binding or not under which any employee or former employee or director or former
director of the Company or any of its Subsidiaries, or any consultant or
independent contractor to the Company or any of its Subsidiaries, has any
present or future right to benefits or under which the Company or any of its
Subsidiaries has any present or future liability.  All such plans, agreements,
programs, policies and arrangements are herein collectively referred to as the
&quot;<U>Company Plans</U>.&quot;  </P>
<OL START=2 TYPE="a">
<OL START=2 TYPE="a">
<OL START=2 TYPE="a">

<LI>With respect to each Company Plan, the Company has delivered or made
available to Parent a current, accurate and complete copy (or, to the extent no
such copy exists, an accurate description) thereof and, to the extent
applicable, (i)&nbsp;any related trust agreement, annuity contract or other
funding instrument; (ii)&nbsp;the most recent IRS determination letter;
(iii)&nbsp;the current summary plan description and other written communications
(or a description of any oral communications) by the Company to its employees
concerning the extent of the benefits provided under a Company Plan; and
(iv)&nbsp;for the three most recent years (A) the Form 5500 and attached
schedules; (B)&nbsp;audited financial statements; (C)&nbsp;actuarial valuation
reports; and (D)&nbsp;attorney's response to an auditor's request for
information. </LI>
<LI>Each Company Plan has been established and administered in material
compliance with its terms and with the applicable provisions of ERISA, the Code
and other applicable laws, rules and regulations (including the applicable laws,
rules and regulations of any foreign jurisdiction), in each case, in all
material respects.  Each Company Plan that is intended to be qualified within
the meaning of Code Section 401(a) is so qualified and has received a favorable
determination letter as to its qualification and to the Knowledge of the Company
nothing has occurred, whether by action or failure to act, which would cause the
loss of such qualification.  With respect to any Company Plan, no actions, suits
or claims (other than routine claims for benefits in the ordinary course) are
pending or, to the best Knowledge of the Company, threatened; to the Knowledge
of the Company no facts or circumstances exist which could give rise to any such
actions, suits or claims and the Company will promptly notify Parent in writing
of any pending claims or, to the Knowledge of the Company, any threatened claims
arising between the date hereof and the Effective Time.  Neither the Company
nor, to the Knowledge of the Company, any other party has engaged in a non-
exempt prohibited transaction, as such term is defined under Code Section 4975
or ERISA Section 406, which would subject the Company or Parent or its
Subsidiaries to any material taxes, penalties or other liabilities under the
Code or ERISA.  To the Knowledge of the Company, no event has occurred and no
condition exists that would subject the Company, either directly or by reason of
its affiliation with any member of its &quot;<U>Controlled Group</U>&quot;
(defined as any organization which is a member of a controlled group of
organizations within the meaning of Code Sections 414(b), (c), (m) or (o)), to
any material tax, fine or penalty imposed by ERISA, the Code or other applicable
laws, rules and regulations (including the applicable laws, rules and
regulations of any foreign jurisdiction).  All insurance premiums required to be
paid and all contributions required to be made under the terms of any Company
Plan, the Code, ERISA or other applicable laws, rules and regulations (including
the applicable laws, rules and regulations of any foreign jurisdiction) as of
the Effective Time have been or will be timely paid or made prior thereto and
adequate reserves have been provided for on the Company's balance sheet for any
premiums (or portions thereof) and for all benefits attributable to service on
or prior to the Effective Time.  For each Company Plan with respect to which a
Form 5500 has been filed, no material change has occurred with respect to the
matters covered by the most recent Form since the date thereof.  No Company Plan
provides for an increase in benefits on or after the Effective Time.</LI>
<LI>No Company Plan is subject to Title IV of ERISA, and no Company Plan is a
multiemployer plan as defined in Section 4001(A)(3) of ERISA.  The Company has
never contributed to or sponsored any multiemployer plan or any plan subject to
Title IV of ERISA.  No Company Plan or related trust is intended to meet the
requirements for tax-favored treatment under Code Section 501(c)(9).</LI>
<LI> No unfunded Company Plan exists that must be accounted for in accordance
with SFAS No. 87, 106 or 112.</LI>
<LI>  No Company Plan exists which could result in the payment to any Company
employee of any money or other property or rights or accelerate or provide any
other rights or benefits to any Company employee as a result of the
Transactions, whether or not such payment would constitute a parachute payment
within the meaning of Code section 280G, and there is no contract, plan or
arrangement (written or otherwise) covering any employee or former employee of
the Company or any of its Subsidiaries that, individually or collectively, could
give rise to the payment of any amount or receipt of any other rights or
benefits that would not be deductible pursuant to the terms of Code section 280G
or limitations on deductibility under Code section 162(m).</LI></OL>
</OL>
</OL>

<OL>
<OL>

<OL>

<LI><A NAME="_Toc516396264"><A NAME="_Toc516438427"><A
NAME="_Toc517021630"><U>Taxes</U>.</A></A></A></LI>
<P>  Each of the Company and each of its Subsidiaries has timely filed or had
filed on its behalf all Tax Returns required to be filed by it and all such
returns are true, complete and correct, or requests for extensions to file such
Tax Returns have been timely filed, granted and have not expired and has paid
all Taxes shown as due on such returns.  The Company has provided adequate
reserves in its financial statements for any Taxes that have not been paid,
whether or not shown as being due on such Tax Returns.  No claim for unpaid
Taxes has been asserted in writing by a Tax authority or has become a lien
against the property of the Company or any of its Subsidiaries (other than with
respect to Taxes not yet due and payable).  No audit or other proceeding with
respect to any Taxes due from or with respect to the Company or any of its
Subsidiaries or any Tax Return filed by the Company or any of its Subsidiaries
is being conducted by any Governmental Entity or Tax authority and the Company
and its Subsidiaries have not received notification in writing that any such
audit or other proceeding with respect to Taxes or any Tax Return is pending.
No extension of the statute of limitations on the assessment of any Taxes has
been granted by the Company or any of its Subsidiaries.  Neither the Company nor
any of its Subsidiaries is subject to liability for Taxes of any Person (other
than the Company or its Subsidiaries), arising from the application of Treasury
Regulation section 1.1502-6 or any analogous provision of state, local or
foreign law, or as a transferee or successor, by contract, or otherwise.  None
of the Company or any of its Subsidiaries is a party to, is bound by or has any
obligation under any Tax sharing or Tax indemnity agreement or similar contract
or arrangement.  None of the Company or any of its Subsidiaries has been a party
to any distribution occurring during the last two years in which the parties to
such distribution treated the distribution as one to which Section 355 of the
Code is applicable.  All Taxes required to be withheld, collected or deposited
by or with respect to the Company and each Subsidiary have been timely withheld,
collected or deposited as the case may be, and to the extent required, have been
paid to the relevant taxing authority.  As used herein:
(i)&nbsp;&quot;<U>Taxes</U>&quot; shall mean all taxes of any kind, including,
without limitation, those on or measured by or referred to as income, gross
receipts, sales, use, ad valorem, franchise, profits, license, withholding,
payroll, employment, excise, severance, stamp, occupation, premium, value added,
property or windfall profits taxes, customs, duties or similar fees, assessments
or charges of any kind whatsoever, together with any interest and any penalties,
additions to tax or additional amounts imposed by any Governmental Entity, and
(ii)&nbsp;&quot;<U>Tax Return</U>&quot; shall mean any return, declaration,
report, claim for refund, information return or statement relating to Taxes,
including any schedule or attachment thereto, and including any amendment
thereof.</P>
<LI><A NAME="_Toc516396265"><A NAME="_Toc516438428"><A
NAME="_Toc517021631"><U>Properties</U>.</A></A></A></LI>
<P>  Except where the failure to have good and valid title would not interfere
in any material respect with the conduct of the business of the Company and its
Subsidiaries as currently conducted, the Company and each of its Subsidiaries
have good title to, or valid leasehold interests in, or otherwise the right to
use all their material properties and assets, and such assets and properties at
the Effective Time will be free and clear of any Liens except for (a)&nbsp;Liens
for current Taxes which are not delinquent, or are being contested in good
faith, (b)&nbsp;mechanics', workers', materialmen's and other like Liens arising
in the ordinary course of business, (c)&nbsp;zoning ordinances, rights of way,
easements, licenses, reservations, covenants, conditions or restrictions on the
use of any of the real property which do not, individually or in the aggregate,
materially interfere with the use of such real property and (d) encumbrances in
the form of restrictions on use of Intellectual Property contained in license
agreements or scientific collaboration agreements.  Neither the Company nor any
of its Subsidiaries is obligated under or bound by any option, right of first
refusal, purchase contract, or other contractual right to sell or dispose of any
real or personal tangible property or any portions thereof or interests therein
which property, portions and interests, either individually or in the aggregate,
are material to the Company.</P>
<LI><A NAME="_Toc516396266"><A NAME="_Toc516438429"><A
NAME="_Toc517021632"><U>Environmental Matters</U>.</A></A></A></LI>
<P>  (a)  Except as could not, individually or in the aggregate, reasonably be
expected to result in a Company Material Adverse Effect: (i) the Company and
each of its Subsidiaries are in compliance with all applicable Environmental
Laws, and during all applicable statute of limitations periods have complied
with all applicable Environmental Laws; and (ii) neither the Company nor any of
its Subsidiaries has, nor would reasonably be expected to have, any obligation
to undertake any Remedial Activity, at any property owned or leased by any of
them or at any other property.</P>
<P>(b)&#9;The Company has furnished, or made available to Buyer, or to its
representatives, true and complete copies of all material Environmental Reports
in the possession or control of the Company or of its Subsidiaries, or fairly
described to Buyer or to its representatives the contents of such reports.</P>
<P>(c)&#9;As used herein:  (i)&nbsp;&quot;<U>Environmental Laws</U>&quot; means
any and all Laws or other legally enforceable requirements (including, without
limitation, common law) of any Governmental Entity, regulating, relating to or
imposing liability or standards of conduct concerning protection of the
environment or of human health, or employee health and safety;
(ii)&nbsp;&quot;<U>Environmental Report</U>&quot; means any report, study,
assessment or audit that addresses any issue of actual or potential
noncompliance with, actual or potential liability under or cost arising out of,
or actual or potential impact on the business of the Company or any of its
Subsidiaries in connection with, any Environmental Law or any proposed or
anticipated change in or addition to any Environmental Law relating to the
Company or any of its Subsidiaries or any entity for which any of them may be
liable; (iii)&nbsp;&quot;<U>Materials of Environmental Concern</U>&quot; means
any gasoline or petroleum (including crude oil or any fraction thereof) or
petroleum products, polychlorinated biphenyls, urea-formaldehyde insulation,
asbestos, pollutants, contaminants and radioactivity that is regulated pursuant
to or could result in liability under any Environmental Law; and
(iv)&nbsp;&quot;<U>Remedial Action</U>&quot; means any action to (A)
investigate, clean up, remove or treat any Materials of Environmental Concern,
or (B) prevent the release or threat of release of any Materials of
Environmental Concern.</P>
<LI><A NAME="_Toc516396267"><A NAME="_Toc516438430"><A
NAME="_Toc517021633"><U>Contracts; Debt Instruments</U>.</A></A></A></LI>
<P>  (a)  Section 2.17(a) of the Company Disclosure Schedule accurately lists as
of the date hereof the following contracts, agreements, commitments,
arrangements, leases, licenses, policies and instruments, whether written or
oral (a &quot;<U>Contract</U>&quot;) to which the Company or any of its
Subsidiaries is a party or by which it or any of its Subsidiaries is bound
(collectively, &quot;<U>Material Contracts</U>&quot;):</P><OL TYPE="a">

<OL TYPE="i">

<FONT FACE="Times"><LI>(A) any Contract relating to any direct or indirect
Indebtedness (including but not limited to loan or credit agreements, notes,
bonds, mortgages, indentures, lease-purchase arrangements, guarantees,
agreements to purchase goods or services or to supply funds or other
undertakings on which others rely in extending credit) in an aggregate principal
amount in excess of $250,000 is outstanding or may be incurred, or (B) any
conditional sales contracts, chattel mortgages, equipment lease agreements, and
other security arrangements with respect to personal property with a value in
excess of $250,000 in each instance used or owned by the Company or any of its
Subsidiaries; </LI>
<LI>any Contract containing covenants limiting the ability of the Company or any
of its Subsidiaries to compete in any line of business with any Person or in any
area or territory or which would so limit the Surviving Company or Parent or any
of their respective Subsidiaries after the Effective Time; </LI>
<LI>any lease for real property; </LI>
<LI>any Contract involving commitments to others to make capital expenditures
involving an aggregate amount in excess of $250,000 or more in any one case,
except Contracts that may be terminated without liability, obligation or penalty
by the Company or its Subsidiary on not more than 30 days' notice; </LI>
<LI>any material licenses, assignments, consents, royalty, development, research
or other similar agreements concerning any Intellectual Property owned or used
by the Company or any of its Subsidiaries, other than licenses generally
commercially available on standard terms, and any agreements concerning the
enforcement or waiver of any rights with respect to any Intellectual Property
owned or used by the Company or any of its Subsidiaries, other than
confidentiality or non-disclosure agreements entered into in the ordinary course
of the Company's business; </LI>
<LI>any joint venture, limited liability, partnership, limited partnership or
similar agreements relating to the formation, creation, operation, management or
control of any corporation, company, partnership or joint venture, and any
investor rights, voting, co-sale or other shareholder agreements, including the
Subsidiary Documents and the Minority Investment Documents, with respect to any
Equity Interests of the Company or any of its Subsidiaries or to which the
Company or any of its Subsidiaries is a party or by which their respective
properties are bound; </LI>
<LI>any agreements entered into since January&nbsp;1, 1999 relating to the
acquisition or disposition of any business or any corporation, partnership,
joint venture, association or other business organization or division thereof by
the Company or any of its Subsidiaries, whether by merger, sale of Equity
Interests, sale of assets or otherwise and any other such agreements under which
the Company or any of its Subsidiaries currently have indemnification
obligations or similar liabilities, whether entered into prior to or since
January&nbsp;1, 1999 (collectively, &quot;<U>Acquisition
Agreements</U>&quot;);</LI>
<LI>any joint development, collaboration, research or material similar
agreements involving the Company or any of its Subsidiaries or their respective
properties;  </LI>
<LI>any Contract not covered by any of the other items of this Section 2.17 that
(i)&nbsp;provides for payments by the Company or any of its Subsidiaries,
whether in cash or Equity Interests, in excess of $250,000, (ii)&nbsp;is not in
the ordinary course of business or (iii)&nbsp;is material to the business,
operations, properties, liabilities or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole.</LI></OL>
</OL>

</FONT><P>(b)&#9;Neither the Company nor any of its Subsidiaries is, and to the
Knowledge of the Company no other party is, in default or breach of any Material
Contract, except for those defaults which would not, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect, and
there has not occurred any event that with the lapse of time or the giving of
notice or both would constitute such a default, except for those defaults which
would not, individually or in the aggregate, reasonably be expected to have a
Company Material Adverse Effect.  Each Material Contract constitutes the legal,
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except to the extent limited by bankruptcy,
insolvency, moratorium, fraudulent conveyance, or other Laws affecting the
rights of creditors generally, and to the extent that the availability of
equitable remedies may be limited by equitable principles, and no Person has the
right to terminate or repudiate any Material Contract on less than 30 days prior
notice or, to the Knowledge of the Company as of the date hereof, has repudiated
any provision of any Material Contract.  No claim of a breach of any
representation, warranty or covenant and no other claim for indemnification has
been made by or against the Company or any of its Subsidiaries under any
Acquisition Agreement prior to the date hereof that has not been fully resolved
prior to the date hereof.  The Company is not a party to any Material Contract
that is required to be disclosed as an exhibit to the SEC Documents in
accordance with the rules and regulations of the SEC that has not been so
disclosed.</P>
<LI><A NAME="_Toc516396268"><A NAME="_Toc516438431"><A
NAME="_Toc517021634"><U>Intellectual Property.</A></A></A></LI>
</U><P>  (a)  Section 2.18(a) of the Company Disclosure Schedule sets forth all
Intellectual Property owned by the Company or its Subsidiaries that is
registered or filed with any Governmental Entity (the &quot;<U>Registered
Intellectual Property</U>&quot;), all licenses of patented Intellectual Property
to or from third parties (the &quot;<U>Licensed Patent Intellectual
Property</U>&quot;) and all other licenses of Intellectual Property other than
licenses generally commercially available on standard terms to or from third
parties by the Company or any of its Subsidiaries that are material to the
business of the Company and its Subsidiaries (together with the Registered
Intellectual Property and the Licensed Patent Intellectual Property, the
&quot;<U>Material Intellectual Property</U>&quot;).  As used herein,
&quot;<U>Intellectual Property</U>&quot; means all rights, privileges and
priorities provided under federal, state, foreign and multinational law relating
to intellectual property, including without limitation all (i)&nbsp;(A)
inventions, discoveries, processes, formulae, designs, methods, techniques,
procedures, concepts, developments, technology, new and useful improvements
thereof and know-how relating thereto, whether or not patented or eligible for
patent protection; (B) copyrights and copyrightable works, including computer
applications, programs, software, databases and related items; (C) trademarks,
service marks, trade names, brand names, corporate names, logos and trade dress,
the goodwill of any business symbolized thereby, and all common-law rights
relating thereto; (D) trade secrets and other confidential information; and
(ii)&nbsp;all registrations, applications, recordings, and licenses or other
similar agreements related to the foregoing.</P>
<P>(b)&#9;The Company and its Subsidiaries own or have the right to use all
Intellectual Property necessary for the Company and its Subsidiaries to conduct
their business substantially as it is currently conducted and consistent with
past practice.</P>
<P>(c)&#9;All of the Registered Intellectual Property owned by the Company or
any of its Subsidiaries is subsisting and unexpired, has not been abandoned and,
to the Knowledge of the Company, does not infringe or otherwise impair the
intellectual property rights of any third party.  To the Knowledge of the
Company, all of the Registered Intellectual Property licensed or used by the
Company or any of its Subsidiaries is subsisting and unexpired, has not been
abandoned and, to the Knowledge of the Company, does not infringe or otherwise
impair the intellectual property rights of any third party.  None of the
Material Intellectual Property owned by the Company or any of its Subsidiaries
is the subject of any license, security interest, Lien or other agreement
granting rights therein to any third party other than the Material Contracts.
To the Knowledge of the Company, the Company has not misappropriated the trade
secrets, technology, know-how, inventions or the like of any third party.  No
judgment, decree, injunction, rule or order has been rendered by any
Governmental Entity which would limit, cancel or question the validity of, or
the Company's or its Subsidiaries' rights in and to any Intellectual Property in
any respect that could reasonably be expected to have, individually or in the
aggregate, a Company Material Adverse Effect.  The Company has not received
written notice, and does not otherwise have knowledge, of any pending or
threatened suit, action or proceeding that seeks to limit, cancel or question
the validity of, or the Company's or its Subsidiaries' rights in and to any
Intellectual Property, which, if adversely determined, could reasonably be
expected to have, individually or in the aggregate, a Company Material Adverse
Effect.  The Company and its Subsidiaries have taken reasonable steps to
protect, maintain and safeguard their material Intellectual Property, including
any Material Intellectual Property for which improper or unauthorized disclosure
would impair its value or validity, and have executed appropriate nondisclosure
agreements and made appropriate filings and registrations in connection with the
foregoing.</P>
<LI><A NAME="_Toc516396269"><A NAME="_Toc516438432"><A
NAME="_Toc517021635"><U>Brokers and Other Advisors</U>.</A></A></A></LI>
<P>  No broker, investment banker, financial advisor or other Person, other than
JP Morgan Chase &amp; Co. (&quot;<U>JP Morgan</U>&quot;), the fees and expenses
of which will be paid by the Company (pursuant to fee agreements, copies of
which have been provided to Parent), is entitled to any broker's, finder's,
financial advisor's or other similar fee or commission in connection with the
Transactions based upon arrangements made by or on behalf of the Company or any
of its Subsidiaries.</P>
<LI><A NAME="_Toc516396270"><A NAME="_Toc516438433"><A
NAME="_Toc517021636"><U>Opinion of Financial Advisor</U>.</A></A></A></LI>
<P>  The Company has received as of the date of this Agreement the opinion of JP
Morgan to the effect that, as of such date, the Merger Consideration is fair,
from a financial point of view, to the holders of Company Common Stock (other
than Parent and its Affiliates). As used herein,
(i)&nbsp;&quot;<U>Affiliate</U>&quot; means a Person that directly or
indirectly, through one or more intermediaries, Controls, is controlled by, or
is under common control with, the first mentioned Person; and
(ii)&nbsp;&quot;<U>Control</U>&quot; (including the terms &quot;<U>controlled
by</U>&quot; and &quot;<U>under common control with</U>&quot;) means the
possession, directly or indirectly or as trustee or executor, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of stock, as trustee or executor, by contract or credit
arrangement or otherwise.</P>
<LI><A NAME="_Toc516396271"><A NAME="_Toc516438434"><A
NAME="_Toc517021637"><U>Board Recommendation; State Antitakeover
Law</U>.</A></A></A></LI>
<P>  The board of directors of the Company, at a meeting duly called and held,
has by unanimous vote of those directors present (i)&nbsp;determined that this
Agreement and the Transactions, including the Merger, are fair to and in the
best interests of the stockholders of the Company and has taken all actions
necessary on the part of the Company to render the restrictions on business
combinations contained in Section 203 of the DGCL inapplicable to this Agreement
and the Merger, and (ii)&nbsp;resolved to recommend that the holders of the
shares of Company Common Stock approve this Agreement and the Transactions,
including the Merger.</P>
<LI><A NAME="_Toc516396272"><A NAME="_Toc516438435"><A
NAME="_Toc517021638"><U>Required Company Vote</U>.</A></A></A></LI>
<P>  The Company Stockholder Approval, being the affirmative vote of a majority
of the outstanding shares of the Company Common Stock, is the only vote of the
holders of any class or series of the Company's securities necessary to approve
this Agreement, the Merger and the other Transactions.  </P>
<LI><A NAME="_Toc516396273"><A NAME="_Toc516438436"><A
NAME="_Toc517021639"><U>Rights Agreement</U>.</A></A></A></LI>
<P>  The Rights Agreement has been amended so as to provide that neither Parent
nor Merger Sub will become an &quot;Acquiring Person&quot; or a &quot;Principal
Party&quot; and that no &quot;Shares Acquisition Date&quot; or
&quot;Distribution Date&quot; (as such terms are defined in the Rights
Agreement) will occur as a result of the approval, execution, delivery or
performance of this Agreement or the consummation of the Merger.  A true and
correct copy of the Rights Agreement as so amended has been delivered to Parent.
</P>
<LI><A NAME="_Toc517021640"><U>Affiliate Transactions</U>.</A></LI></OL>
</OL>
</OL>

<P>  As of the date hereof, there are no existing Contracts, transactions,
indebtedness or other arrangements, or any related series thereof, between the
Company or any of its Subsidiaries, on the one hand, and any of the directors,
officers or other Affiliates of the Company and its Subsidiaries, on the other
hand.</P>
<OL TYPE="I">

<U><P ALIGN="CENTER"><LI><BR>
<BR>
<A NAME="_Toc516396275"><A NAME="_Toc516438437"><A
NAME="_Toc517021641">REPRESENTATIONS AND WARRANTIES OF
PARENT</A></A></A></LI></P>
</U><P>Except as set forth in the written disclosure schedule dated as of the
date of this Agreement and previously delivered by Parent to the Company (the
&quot;<U>Parent Disclosure Schedule</U>&quot;) (it being understood that the
Parent Disclosure Schedule shall be arranged in sections corresponding to the
sections contained in this Agreement, and the disclosures in any section of the
Parent Disclosure Schedule shall qualify all of the representations in the
corresponding section of this Article III and all applicable representations in
other sections of this Article&nbsp;III to the extent that such qualification is
readily apparent ), Parent hereby represents and warrants to the Company as
follows:</P>
<OL>

<OL>

<LI><A NAME="_Toc516396276"><A NAME="_Toc516438438"><A
NAME="_Toc517021642"><U>Organization, Standing and Corporate
Power</U>.</A></A></A></LI>
<P>  Each of Parent, Merger Sub and each of Parent's &quot;significant
Subsidiaries&quot; (within the meaning of Rule 1-02 of Regulation S-X of the
SEC) (collectively, the &quot;<U>Parent Subsidiaries</U>&quot;) is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation and has the requisite corporate
or other power and authority necessary to own, lease and operate its properties
and to carry on its business as it is now being conducted.  Each of Parent,
Merger Sub and each of the Parent Subsidiaries is duly qualified or licensed as
a foreign corporation or entity to do business, and is in good standing, in each
jurisdiction where the character of its properties owned, leased or operated by
it or the nature of its activities makes such qualification or licensing
necessary, except where the failure to be so duly qualified or licensed and in
good standing would not, individually or in the aggregate, reasonably be
expected to have any materially adverse effect on the business, assets,
liabilities, financial condition or results of operations of Applera
Corporation-Celera Genomics Group, taken as a whole, other than any such effect
resulting from any change, effect, event, occurrence, state of facts or
development relating to the industry in which Parent operates in general and not
specifically relating to Parent or on the ability of Parent and Merger Sub to
perform its obligations under this Agreement (a &quot;<U>Parent Material Adverse
Effect</U>&quot;).  Parent has made available to the Company complete and
correct copies of its certificate of incorporation and by-laws and the
certificate of incorporation and by-laws of Merger Sub.</P>
<LI><A NAME="_Toc516396277"><A NAME="_Toc516438439"><A
NAME="_Toc517021643"><U>Capital Structure</U>.</A></A></A></LI>
<P>  (a)  As of the date of this Agreement, the authorized capital stock of
Parent consists of 1,255,000,000 shares of common stock of Parent (consisting of
1,000,000,000 shares of Parent Common Stock and 225,000,000 shares of Applera
Corporation-Applied Biosystems Group Common Stock, par value $.01 per share
(&quot;<U>AB Stock</U>&quot;)) and 10,000,000 shares of preferred stock of
Parent (the &quot;<U>Parent Preferred Stock</U>&quot;). As of the close of
business on June 11, 2001, there were: (i)&nbsp;61,561,502.74 shares of Parent
Common Stock issued and outstanding; (ii)&nbsp;13,717 shares of Parent Common
Stock held in the treasury of Parent; (iii)&nbsp;14,127,347.26 shares of Parent
Common Stock reserved for issuance pursuant to Parent's stock option plans,
Parent's employee stock purchase plans and Parent's Director Stock Purchase and
Deferred Compensation Plan (collectively, the &quot;<U>Parent Stock
Plans</U>&quot;); (iv)&nbsp;13,018,883 shares of Parent Common Stock issuable
upon exercise of awarded but unexercised stock options; (v)&nbsp;56,350 shares
of Parent Common Stock issuable upon exercise of currently outstanding warrants
to purchase Parent Common Stock; (vi) 1,432,200 shares of Parent Common Stock
issuable upon exercise of an option held by a third party;
(vii)&nbsp;211,265,745.85 shares of AB Stock issued and outstanding;
(viii)&nbsp;5,105 shares of AB Stock held in the treasury of Parent;
(ix)&nbsp;31,613,807.05 shares of AB Stock reserved for issuance pursuant to
Parent Stock Plans; (x)&nbsp;27,811,815 shares of AB Stock issuable upon
exercise of awarded but unexercised stock options; (xi) 214,794 shares of AB
Stock issuable upon exercise of currently outstanding warrants to purchase AB
Stock; and (xii) no shares of Parent Preferred Stock outstanding.  Except as set
forth above and except for shares of participating junior preferred stock
issuable pursuant to the Shareholders' Protection Rights Plan, dated as of April
28, 1999 between Parent and BankBoston, N.A., as of the close of business on
June 11, 2001, there were no shares of capital stock or other equity securities
of Parent issued, reserved for issuance or outstanding.  </P>
<P>(b)&#9;All outstanding shares of capital stock of Parent are, and all shares
which may be issued as described above will be, when issued, duly authorized,
validly issued, fully paid and nonassessable and not subject to preemptive
rights.  </P>
<P>(c)&#9;There is no outstanding Voting Debt of Parent.  Except as set forth
above, there are no options, warrants or other rights, agreements, arrangements
or commitments of any character binding on Parent relating to the issued or
unissued Equity Interests of Parent or obligating Parent to issue, sell,
repurchase, redeem or otherwise acquire or make any payment with respect to any
Equity Interests of Parent or any of its Subsidiaries.  </P>
<P>(d)&#9;Between June 11, 2001 and the date of this Agreement, Parent has not
issued or reserved for issuance any Parent Common Stock or other Equity
Interests of Parent, except pursuant to or as permitted by the terms of the
Parent Stock Plans.  Between December 31, 2000 and the date of this Agreement,
Parent has not (A) repurchased, redeemed or otherwise acquired any Equity
Interests of Parent or (B) declared, set aside, made or paid any dividend or
distribution in respect of any of its Equity Interests (other than regular
quarterly cash dividends on AB Stock), and the board of directors of Parent has
not resolved to do any of the foregoing.</P>
<P>(e)&#9;As of the date hereof, the authorized capital stock of Merger Sub
consists of 1,000 shares of common stock, par value $.01 per share, all of which
have been validly issued, are fully paid and nonassessable and are owned by
Parent, free and clear of any Lien, and as of the Closing Date, all the issued
and outstanding shares of the common stock of Merger Sub will be owned by Parent
free and clear of any Lien.</P>
<LI><A NAME="_Toc516396278"><A NAME="_Toc516438440"><A
NAME="_Toc517021644"><U>Authority</U>.</A></A></A></LI>
<P>  Parent and Merger Sub have all necessary corporate power and authority to
execute and deliver this Agreement and to perform their respective obligations
hereunder and to consummate the Transactions.  The execution and delivery of
this Agreement by Parent and Merger Sub and the consummation by Parent and
Merger Sub of the Transactions have been duly and validly authorized by all
necessary corporate action on the part of Parent and Merger Sub.  This Agreement
has been duly and validly executed and delivered by each of Parent and Merger
Sub and, assuming the due authorization, execution and delivery hereof by the
Company, constitutes the legal, valid and binding obligation of each of Parent
and Merger Sub, enforceable against such parties in accordance with its terms,
except to the extent limited by bankruptcy, insolvency, moratorium, fraudulent
conveyance, or other Laws affecting the rights of creditors generally, and to
the extent that the availability of equitable remedies may be limited by
equitable principles.  All shares of Parent Common Stock that may be issued
pursuant to the Agreement shall when issued in accordance with this Agreement be
duly authorized, validly issued, fully paid and nonassessable and not be subject
to preemptive rights.  The board of directors of Parent has made a determination
that as of the Effective Time the assets, business and liabilities of the
Company shall be for the benefit of the Celera Genomics Group of Parent and
shall be attributed in their entirety to the Celera Genomics Group of Parent as
of the Effective Time, in accordance with the provisions of
Sections&nbsp;2.5(a)(i) and 2.6(f) of Parent's certificate of incorporation, as
in effect as of the date hereof.</P>
<LI><A NAME="_Toc516396279"><A NAME="_Toc516438441"><A
NAME="_Toc517021645"><U>Noncontravention</U>.</A></A></A></LI>
<P>  (a)  The execution and delivery of this Agreement by each of Parent and
Merger Sub does not, and the performance of this Agreement by Parent and Merger
Sub and the consummation of the Transactions will not, (i)&nbsp;conflict with or
violate the respective certificates of incorporation and by-laws of Parent and
Merger Sub, (ii)&nbsp;assuming that all consents, approvals and authorizations
contemplated by clauses (i)-(v), inclusive, of Section 3.04(b) hereof have been
obtained and all filings described in such clauses have been made (and declared
effective, if applicable), conflict with or violate any Laws applicable to
Parent or any Parent Subsidiaries or by which any of their respective properties
is bound or affected, or (iii)&nbsp;result in any breach of or constitute a
default (or an event that 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 alteration of rights under or require the
consent or approval of any Person under, or result in the creation of a Lien on
any of the properties or assets of Parent or any Parent Subsidiaries pursuant
to, any note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise, joint venture, limited liability or partnership agreement or
other instrument to which Parent or any of its Subsidiaries is a party or by
which Parent or any Parent Subsidiaries or any of their respective properties is
bound or affected, except, in the case of clauses (ii)&nbsp;and (iii)&nbsp;of
this Section 3.04(a), for any conflict, violation, breach, default, impairment,
right or lack of consent or approval that would not, individually or in the
aggregate, reasonably be expected to have a Parent Material Adverse Effect.
</P>
<P>(b)&#9;The execution and delivery of this Agreement by Parent and Merger Sub
do not, and the performance of this Agreement by Parent and Merger Sub and the
consummation of the Transactions by Parent and Merger Sub will not, require any
consent, approval, authorization or permit of, or filing with or notification
to, any Governmental Entity, except (i)&nbsp;the filing of a premerger
notification and report form by Parent under the HSR Act, (ii)&nbsp;the filing
of the Certificate of Merger with the Secretary of State of the State of
Delaware and appropriate documents with the relevant authorities of other states
in which the Company is qualified to do business, (iii)&nbsp;the filing with the
SEC of the Form S-4 and such reports under the Exchange Act as may be required
in connection with this Agreement and the Transactions, (iv)&nbsp;consents,
approvals, orders, authorizations, registrations, declarations, filings or
notices as may be required under the &quot;takeover&quot; or &quot;blue
sky&quot; laws of various states, (v)&nbsp;consents, approvals, authorizations,
permits, filings or notifications which have heretofore been obtained or made,
as the case may be, by Parent and are in full force and effect or
(vi)&nbsp;where the failure to obtain such consents, approvals, authorizations
or permits, or to make such filings or notifications, would not, individually or
in the aggregate, reasonably be expected to have a Parent Material Adverse
Effect.</P>
<LI><A NAME="_Toc516396280"><A NAME="_Toc516438442"><A
NAME="_Toc517021646"><U>Parent SEC Documents; Financial
Statements</U>.</A></A></A></LI>
<P>  (a)  Parent and its predecessors have filed on a timely basis all forms,
reports and documents required to be filed with the SEC since January 1, 1998
(all forms, reports and documents filed by Parent and its predecessors with the
SEC since January 1, 1998, in each case including all exhibits and schedules
thereto and documents incorporated by reference therein, such documents together
with any documents filed during such period by Parent with the SEC on a
voluntary basis on Current Reports on Form&nbsp;8K are referred to herein as the
&quot;<U>Parent SEC Documents</U>&quot;).  The Parent SEC Documents
(i)&nbsp;complied as to form in all material respects with the requirements of
the Securities Act or the Exchange Act, as the case may be, and the rules and
regulations thereunder, each as in effect on the date so filed or amended, and
(ii)&nbsp;did not at the time they were filed (or if amended or superseded by a
filing, which filing must have occurred prior to the date of this Agreement for
the Parent SEC Documents otherwise filed prior to the date of this Agreement,
then on the date of such filing) contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.  </P>
<P>(b)&#9;Each of the audited and unaudited consolidated financial statements
(including, in each case, any related notes thereto) contained in the Parent SEC
Documents were prepared in accordance with GAAP applied on a consistent basis
throughout the periods involved (except as may be indicated in the notes thereto
or in the Parent SEC Documents), and each fairly presents the consolidated
financial position of Parent and the Parent Subsidiaries at the respective dates
thereof and the consolidated results of their operations and cash flows for the
periods indicated, except that the unaudited interim financial statements were
or are subject to normal and recurring year-end adjustments and do not contain
all of the footnote disclosures required by GAAP.  </P>
<LI><A NAME="_Toc516396281"><A NAME="_Toc516438443"><A
NAME="_Toc517021647"><U>Undisclosed Liabilities</U>.</A></A></A></LI>
<P>  Neither Parent nor any Parent Subsidiary has any liabilities or obligations
of any nature (whether accrued, absolute, contingent or otherwise) required by
GAAP to be recognized or disclosed on a consolidated balance sheet of Parent and
its Subsidiaries or in the notes thereto, except (i)&nbsp;liabilities reflected
in the audited consolidated balance sheet of the Parent as of June 30, 2000, and
(iii)&nbsp;liabilities incurred since June 30, 2000 in the ordinary course of
business consistent with past practice that, individually or in the aggregate,
would not reasonably be expected to have a Parent Material Adverse Effect.</P>
<LI><A NAME="_Toc516396282"><A NAME="_Toc516438444"><A
NAME="_Toc517021648"><U>Information Supplied</U>.</A></A></A></LI>
<P>  None of the information supplied or to be supplied by Parent or Merger Sub
for inclusion or incorporation by reference in (i)&nbsp;the Form S-4 will, at
the time the Form S-4 is filed with the SEC, at any time it is amended or
supplemented or at the time it becomes effective under the Securities Act, or
(ii)&nbsp;the Proxy Statement will, at the date it is first mailed to the
Company's stockholders or at the time of the Stockholders Meeting, 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 therein, in
the light of the circumstances under which they are made, not misleading.  The
Form S-4 will comply as to form in all material respects with the requirements
of the Securities Act and the rules and regulations promulgated thereunder,
except that no representation is made by Parent or Merger Sub with respect to
statements made or incorporated by reference therein based on information
supplied in writing by the Company specifically for inclusion or incorporation
by reference therein.  </P>
<LI><A NAME="_Toc516396283"><A NAME="_Toc516438445"><A
NAME="_Toc517021649"><U>Absence of Certain Changes or
Events</U>.</A></A></A></LI>
<P>  Since December 31, 2000, there is not and has not been: (a) any condition,
event or occurrence, individually or in the aggregate, resulting in a Parent
Material Adverse Effect; (b) any condition, event or occurrence which,
individually or in the aggregate, would reasonably be expected to have or give
rise to a Parent Material Adverse Effect; or (c) any action which, if it had
been taken or occurred after the execution of this Agreement, would have
required the consent of the Company pursuant to this Agreement.</P>
<LI><A NAME="_Toc516396284"><A NAME="_Toc516438446"><A
NAME="_Toc517021650"><U>Litigation; Compliance with Laws</U>.</A></A></A></LI>
<P>  (a)  There is no suit, action, arbitration, proceeding or investigation
pending, or, to the knowledge of the employees of Parent set forth on
Schedule&nbsp;3.09 hereto (the &quot;<U>Knowledge of Parent</U>&quot;),
threatened against Parent or any of its Subsidiaries that, individually or in
the aggregate, would reasonably be expected to have a Parent Material Adverse
Effect.  To the Knowledge of Parent, neither Parent nor any of its Subsidiaries
nor any of their respective properties is or are subject to any order, writ,
judgment, injunction, decree, determination or award having, or which would
reasonably be expected to have, a Parent Material Adverse Effect.</P>
<P>(b)&#9;The businesses of Parent and its Subsidiaries are not being conducted
in violation of any law (domestic or foreign), ordinance or regulation of any
Governmental Entity, except for possible violations that, individually or in the
aggregate, do not and could not reasonably be expected to have a Parent Material
Adverse Effect.</P>
<LI><A NAME="_Toc516396285"><A NAME="_Toc516438447"><A
NAME="_Toc517021651"><U>Brokers</U>.</A></A></A></LI>
<P>  No broker, investment banker, financial advisor or other Person, other than
Morgan Stanley and Co. Incorporated (&quot;<U>Morgan Stanley</U>&quot;), the
fees and expenses of which will be paid by Parent, is entitled to any broker's,
finder's, financial advisor's or other similar fee or commission in connection
with the Transactions based upon arrangements made by or on behalf of Parent or
Merger Sub.  </P>
<LI><A NAME="_Toc516396287"><A NAME="_Toc516438449"><A
NAME="_Toc517021652"><U>Interim Operations of Merger Sub</U>.</A></A></A></LI>
<P>  Merger Sub was formed on June 8, 2001 solely for the purpose of engaging in
the Transactions, has engaged in no other business activities and has conducted
its operations only as contemplated hereby.</P>
<LI><A NAME="_Toc516396289"><A NAME="_Toc516438450"><A
NAME="_Toc517021653"><U>Required Vote</U><I>.</A></A></A></LI></OL>
</OL>

</I><P>  This Agreement has been approved by Parent, as the sole stockholder of
Merger Sub.  No other vote of holders of any class or series of securities of
Parent or Merger Sub is necessary to approve this Agreement and the
Transactions.  </P>
<U><P ALIGN="CENTER"><LI><BR>
<BR>
<A NAME="_Toc516304932"><A NAME="_Toc516304983"><A NAME="_Toc516396290"><A
NAME="_Toc516438451"><A NAME="_Toc517021654">COVENANTS RELATING TO CONDUCT OF
BUSINESS PRIOR TO MERGER.</A></A></A></A></A></LI></P>
<OL>

<OL>

<LI><A NAME="_Toc516304933"><A NAME="_Toc516304984"><A NAME="_Toc516396291"><A
NAME="_Toc516438452"><A NAME="_Toc517021655">Conduct of Business</A></A> by the
Company</U>.</A></A></A></LI>
<P>  During the period from the date of this Agreement to the Effective Time,
the Company shall, and shall cause its Subsidiaries to, act and carry on their
respective businesses in the ordinary course of business consistent with past
practice and use its and their respective reasonable best efforts to preserve
substantially intact their current business organizations, keep available the
services of their current officers and employees and preserve their
relationships with customers, suppliers, licensors, licensees, development
partners, and others having significant business dealings with them.  Without
limiting the generality of the foregoing, during the period from the date of
this Agreement to the Effective Time, except as provided in Section&nbsp;4.01 of
the Company Disclosure Schedule and except as expressly provided in this
Agreement (but excluding for this purpose any provisions of the Company
Disclosure Schedule other than those contained in Section 4.01 or 4.03 thereof)
the Company shall not, and shall not permit any of its Subsidiaries to:</P>
<OL TYPE="a">

<LI>(i)&nbsp;declare, set aside or pay any dividends on, or make any other
distributions in respect of, any of its capital stock, (ii)&nbsp;split, combine
or reclassify any capital stock of the Company or any Subsidiary or issue or
authorize the issuance of any other Equity Interests in respect of, in lieu of
or in substitution for shares of capital stock of the Company or any Subsidiary,
or (iii)&nbsp;purchase, redeem or otherwise acquire any Equity Interests of the
Company or any of its Subsidiaries;</LI>
<LI>authorize for issuance, issue, deliver, sell, pledge or otherwise encumber
any Equity Interest of the Company or any of its Subsidiaries, other than
(i)&nbsp;the issuance of Company Common Stock upon the exercise of Company
Warrants outstanding on the date of this Agreement in accordance with their
present terms, (ii)&nbsp;the issuance of Company Common Stock upon the exercise
of Company Stock Options awarded prior to the date of this Agreement but
unexercised on the date of this Agreement (or granted after the date hereof in
accordance with Section 4.03 hereof) in accordance with their present terms,
(iii)&nbsp;the issuance of Company Common Stock pursuant to the Company's
Employee Stock Purchase Plan in accordance with its present terms, (iv)&nbsp;the
conversion of the Convertible Notes in accordance with their present terms,
(v)&nbsp;the issuance of Company Common Stock in order to pay interest on the
Convertible Notes, should the Company so elect, in accordance with their present
terms and (vi)&nbsp;the sale of shares of capital stock of Akkadix Corporation,
DNA Sciences, Inc. or Discovery Partners International, Inc. upon the exercise
of options outstanding as of the date hereof pursuant to the 1999 Key Personnel
Stock Option Plan; </LI>
<LI>amend (i)&nbsp;the Certificate of Incorporation or By-Laws or the comparable
charter or organizational documents of any Subsidiary of the Company or
(ii)&nbsp;the Rights Agreement;</LI>
<LI>acquire or agree to acquire by merging or consolidating with, or by
purchasing a substantial portion of the stock or assets of, or by any other
manner, any business or any corporation, partnership, joint venture, association
or other business organization or division thereof; </LI>
<LI>sell, lease, license, mortgage or otherwise encumber or subject to any Lien
or otherwise dispose of (i)&nbsp;any of its properties or assets, other than any
such properties or assets the value of which do not exceed $50,000 individually
and $250,000 in the aggregate, except the granting of purchase money security
interests in the ordinary course of business consistent with past practice or
(ii)&nbsp;any Minority Investments or other Equity Interests in any other Person
(other than as set forth in Section 4.01(b)(vi));</LI>
<LI>(i)&nbsp;incur any Indebtedness for borrowed money or guarantee any such
Indebtedness of another Person, issue or sell any debt securities or warrants or
other rights to acquire any debt securities of the Company or any of its
Subsidiaries, guarantee any debt securities of another Person, enter into any
&quot;keep well&quot; or other agreement to maintain any financial statement
condition of another Person or enter into any arrangement having the economic
effect of any of the foregoing, except for short-term borrowings incurred in the
ordinary course of business consistent with past practice and other than
pursuant to equipment lease financing not to exceed $250,000, in the aggregate,
or (ii)&nbsp;make any loans, advances or capital contributions to, or Minority
Investments or other investments in, any other Person, other than to the
Company;</LI>
<LI>make or agree to make any capital expenditures, except capital expenditures
described in the capital expenditure budget attached as Annex A to Section
4.01(g) of the Company Disclosure Schedule and such additional capital
expenditures as do not exceed $50,000 individually and $250,000 in the
aggregate; or acquire or agree to acquire any other assets, other than inventory
and supplies in the ordinary course of business consistent with past
practice;</LI>
<LI>(i)&nbsp;waive, release, grant, or transfer any rights of material value or
modify or change in any material respect any existing material license, lease,
contract or other document, other than in the ordinary course of business
consistent with past practice, (ii)&nbsp;pay, discharge or satisfy any claims
(including claims of stockholders), liabilities or obligations (absolute,
accrued, asserted or unasserted, contingent or otherwise), other than the
payment, discharge or satisfaction of liabilities or obligations in the ordinary
course of business consistent with past practice or in accordance with their
terms as in effect on the date hereof or (iii)&nbsp;settle or compromise any
litigation or claim other than settlements or compromises of litigation or
claims that do not relate to this Agreement or the Transactions and do not
provide for injunctive or similar relief and where the amount paid (after giving
effect to insurance proceeds actually received) in settlement or compromise does
not exceed $50,000 individually or $250,000 in the aggregate;</LI>
<LI>adopt a plan of complete or partial liquidation or resolutions providing for
or authorizing such a liquidation or a dissolution, merger, consolidation,
restructuring, recapitalization or reorganization;</LI>
<LI>enter into or amend any collective bargaining agreement;  </LI>
<LI>enter into or amend in any material respect any Material Contract of the
type specified in clause (iii), (v), (vi), (vii)&nbsp;or (viii)&nbsp;of Section
2.17(a) hereof, or any Contract, transaction, indebtedness or other arrangement
of the type described in Section 2.24 hereof; or enter into or amend any
Material Contract of the type specified in Section&nbsp;2.17(a)(ii) hereof;</LI>
<LI>change any accounting principle used by it, except as required by GAAP;</LI>
<LI>transfer to any Person any rights to its Intellectual Property other than
the granting of end-user licenses and the right to grant end-user sublicenses in
the ordinary course of business consistent with past practice to customers of
the Company or its Subsidiaries to the extent such licenses are necessary to
permit such customers to use products purchased from the Company or such
Subsidiaries;</LI>
<LI>enter into or amend any agreement pursuant to which any other party is
granted exclusive development, marketing or other exclusive rights of any type
or scope with respect to any of its research, products, Intellectual Property or
other technology; or</LI>
<LI>authorize, or commit or agree to take, any of the foregoing
actions.</LI></OL>

<LI><A NAME="_Toc516396292"><A NAME="_Toc516438453"><A
NAME="_Toc517021656"><U>Conduct of Business by Parent</U>.</A></A></A></LI>
<P>  During the period from the date of this Agreement to the Effective Time,
Parent shall not (a) declare, set aside or pay any dividends on, or make any
other distributions in respect of, Parent Common Stock or (b) split, combine or
reclassify the Parent Common Stock or issue or authorize the issuance of any
other Equity Interests in lieu of or in substitution for shares of Parent Common
Stock.</P>
<LI><A NAME="_Toc516396293"><A NAME="_Toc516438454"><A
NAME="_Toc517021657"><U>Employment Arrangements</U>.</A></A></A></LI>
<P>  Except as set forth in Section 4.03 of the Company Disclosure Schedule or
as expressly provided in this Agreement (but excluding for this purpose any
provisions of the Company Disclosure Schedule other than those contained in
Section 4.01 or 4.03 thereof):</P>
<OL TYPE="a">

<LI>Except as may be required by applicable law, neither the Company nor any of
its Subsidiaries shall (i)&nbsp;adopt or amend (except as may be required by
law) any bonus, profit sharing, compensation, stock option, pension, retirement,
deferred compensation, employment or other employee benefit plan, agreement,
trust, fund or other arrangement for the benefit or welfare of any employee,
director or former director or employee or (ii)&nbsp;increase the compensation
or fringe benefits of any director, employee or former director or employee or
pay any benefit not required by any existing plan, arrangement or agreement, in
the case of clause (ii)&nbsp;other than increases for individuals (other than
officers and directors) in the ordinary course of business consistent with past
practice.</LI></OL>
</OL>
</OL>
</OL>

<OL START=2 TYPE="a">
<DIR>
<DIR>

<OL TYPE="a">

<LI>neither the Company nor any of its Subsidiaries shall hire or terminate any
employee or consultant, except in the ordinary course of business consistent
with past practice, and except to the extent required under applicable law or
under existing Company Plans.</LI>
<LI>Except pursuant to the terms of this Agreement, neither the Company nor any
of its Subsidiaries shall grant any new or modified change in control,
incentive, severance or termination arrangement or increase or accelerate any
benefits payable under its change in control, incentive, severance or
termination pay policies in effect on the date hereof.</LI>
<LI>Neither the Company nor any of its Subsidiaries shall effectuate a
&quot;plant closing&quot; or &quot;mass layoff,&quot; as those terms are defined
in WARN, affecting in whole or in part any site of employment, facility,
operating unit or employee of the Company or any Subsidiary, without notifying
Merger Sub or its Affiliates in advance and without complying with the notice
requirements and other provisions of WARN.</LI>
<LI>Recognizing that the retention of the employees of the Company and its
Subsidiaries is to the material benefit of Parent, in the event that the human
resources manager, the vice presidents of human resources, medicinal chemistry
or biology, the senior vice president of research and pre-clinical development
or any other officer of the Company more senior than such senior vice president,
receives any written or oral indication from any employee at level 22 or above
that such employee intends to terminate his or her employment with the Company
or any of its Subsidiaries within sixty (60) days, the Company shall notify
Parent within three (3) business days in order that Parent may meet with such
employee, <U>provided</U> that in the event any such indication is in the form
of a formal written notice of resignation, the Company shall notify Parent by
the next business day.</LI></OL>
</DIR>
</DIR>
</OL>

<OL>
<OL>

<OL>

<LI><A NAME="_Toc516396294"><A NAME="_Toc516438455"><A
NAME="_Toc517021658"><U>Tax Elections</U>.</A></A></A></LI>
<P>  Neither the Company nor any of its Subsidiaries shall make or change any
Tax election, settle or compromise any material federal, state, local or foreign
Tax liability, change any annual Tax accounting period, change any method of Tax
accounting, file any amended material Tax Return, enter into any closing
agreement relating to any material Tax, surrender any right to claim a material
Tax refund, or consent to any extension or waiver of the statute of limitations
period applicable to any material Tax claim or assessment.</P>
<LI><A NAME="_Toc516396295"><A NAME="_Toc516438456"><A
NAME="_Toc517021659"><U>Tax-Free Reorganization Treatment</U>.</A></A></A></LI>
<P>  (a)  Neither Company nor Parent shall, nor shall they permit any of their
respective Subsidiaries to, take or cause to be taken any action that would
disqualify the Merger as a reorganization within the meaning of Section 368(a)
of the Code.</P>
<P>(b)  Each of the Company and Parent shall report the Merger as a
reorganization within the meaning of Section 368 of the Code, unless otherwise
required pursuant to a &quot;determination&quot; within the meaning of Section
1313(a) of the Code.</P>
<LI><A NAME="_Toc516396296"><A NAME="_Toc516438457"><A
NAME="_Toc517021660"><U>Other Actions</U>.</A></A></A></LI></OL>
</OL>
</OL>

<P>  Neither the Company nor Parent shall, or shall permit any of their
respective Subsidiaries to, (a) intentionally take any action that, if taken on
or prior to the date of this Agreement, would have resulted in any of its
representations and warranties set forth in this Agreement being untrue in any
material respect, or (b) intentionally take any action that would or reasonably
might be expected to, result in any of the conditions to the Merger set forth in
Article VI not being satisfied.  The Company and Parent shall promptly advise
the other party orally and in writing of (i)&nbsp;any action of the type set
forth in clause (a) above, (ii)&nbsp;the failure by such party to comply with
any covenant, condition or agreement hereunder and (iii)&nbsp;any event which
could reasonably be expected to cause the conditions set forth in Article VI not
being satisfied; <I>provided, however,</I> that no such notice shall affect the
representations, warranties, covenants and agreements of the parties or the
conditions to their obligations hereunder.</P>
<OL TYPE="I">

<P ALIGN="CENTER"><LI><A NAME="_Toc516304934"><A NAME="_Toc516304985"><U><BR>
<BR>
<A NAME="_Toc516396297"><A NAME="_Toc516438458"><A
NAME="_Toc517021661">ADDITIONAL AGREEMENTS</A></A></A></A></A></LI></P>
<OL>

<OL>

<LI><A NAME="_Toc516304935"><A NAME="_Toc516304986"><A NAME="_Toc516396298"><A
NAME="_Toc516438459"><A NAME="_Toc517021662">Preparation of Form S-4 and Proxy
Statement; Stockholder Meeting</A></A></U>.</A></A></A></LI>
<P>  (a)  Promptly following the date of this Agreement, the Company shall
prepare the proxy statement with respect to the vote by the Company's
stockholders with respect to the Transactions (the &quot;<U>Proxy
Statement</U>&quot;), and Parent shall prepare and file with the SEC the Form S-
4, in which the Proxy Statement will be included.  Parent and the Company shall
each use its reasonable best efforts to have the Form S-4 declared effective
under the Securities Act as promptly as practicable after such filing.  The
Company will use its reasonable best efforts to cause the Proxy Statement to be
mailed to the Company's stockholders as promptly as practicable after the Form
S-4 is declared effective under the Securities Act.  Parent shall also take any
action (other than qualifying to do business in any state in which it is not now
so qualified or filing a general consent to service of process) required to be
taken under any applicable state securities laws in connection with the
registration and qualification of the Parent Common Stock to be issued in the
Merger, and the Company shall furnish all information relating to the Company
and its stockholders as may be reasonably requested in connection with any such
action.  The information provided and to be provided by Parent, Merger Sub and
the Company, respectively, (i)&nbsp;for use in the Form S-4, at the time the
Form S-4 becomes effective, shall be true and correct in all material respects
and shall not omit to state a material fact required to be stated therein or
necessary to make such information not misleading and (ii)&nbsp;for use in the
Proxy Statement, on the date the Proxy Statement is mailed to the Company's
stockholders and on the date of the Stockholders Meeting referred to below,
shall be true and correct in all material respects and shall not omit to state
any material fact required to be stated therein or necessary in order to make
such information, in the light of the circumstances under which the statements
therein were made, not misleading, and the Company and Parent each agree to
correct any information provided by it for use in the Form S-4 and the Proxy
Statement which shall have become false or misleading.</P>
<P>(b)&#9;All mailings to the Company's stockholders in connection with the
Merger, including the Proxy Statement, shall be subject to the prior review,
comment and approval of Parent (such approval not to be unreasonably withheld or
delayed).</P>
<P>(c)&#9;The Company will, as promptly as practicable following the date of
this Agreement and in consultation with Parent, duly call, give notice of,
convene and hold a meeting of its stockholders (the &quot;<U>Stockholders
Meeting</U>&quot;) for the purpose of approving this Agreement and the
Transactions to the extent required by the DGCL.  The Company will, through its
board of directors, recommend to its stockholders approval of the foregoing
matters, as set forth in Section 2.21; <U>provided</U>, <U>however</U>, that,
subject to compliance with the provisions of Section 5.06 hereof, the board of
directors of the Company may fail to make or withdraw or modify such
recommendation to the extent permitted by Section 5.06.  Any such
recommendation, together with a copy of the opinion referred to in Section 2.20,
shall be included in the Proxy Statement.  The Company will use its best efforts
to hold such meeting as soon as practicable after the Form S-4 shall have been
declared effective.</P>
<LI><A NAME="_Toc516304936"><A NAME="_Toc516304987"><A NAME="_Toc516396299"><A
NAME="_Toc516438460"><A NAME="_Toc517021663"><U>Access to Information;
Confidentiality</A></A></U>.</A></A></A></LI>
<P>  The Company shall, and shall cause its Subsidiaries, officers, employees,
counsel, financial advisors and other representatives to, afford to Parent and
its representatives reasonable access during normal business hours, during the
period prior to the Effective Time to its properties, books, contracts,
commitments, personnel and records, and, during such period, the Company shall,
and shall cause its Subsidiaries, officers, employees and representatives to,
furnish or make available promptly to Parent (i)&nbsp;a copy of each report,
schedule, registration statement and other document filed by it during such
period pursuant to the requirements of federal or state securities laws and
(ii)&nbsp;all other information concerning its business, properties, financial
condition, operations and personnel as Parent may from time to time reasonably
request.  Each of the Company and Parent will hold, and will cause their
respective directors, officers, employees, accountants, counsel, financial
advisors and other representatives and Affiliates to hold, any nonpublic
information with respect to the other party in confidence to the extent required
by, and in accordance with, the provisions of the confidentiality agreement,
dated April 2, 2001, between Parent and the Company (the
&quot;<U>Confidentiality Agreement</U>&quot;).  No investigation pursuant to
this Section&nbsp;5.02 shall affect any representations or warranties of the
parties herein or the conditions to the obligations of the parties hereto.</P>
<LI><A NAME="_Toc516304937"><A NAME="_Toc516304988"><A NAME="_Toc516396300"><A
NAME="_Toc516438461"><A NAME="_Toc517021664"><U>Reasonable Best
Efforts</A></A></U>.</A></A></A></LI>
<P>  Upon the terms and subject to the conditions set forth in this Agreement,
each of the parties hereto agrees to use its reasonable best efforts to take, or
cause to be taken, all actions, and to do, or cause to be done, and to assist
and cooperate with the other parties hereto in doing, all things necessary,
proper or advisable under applicable laws and regulations to consummate and make
effective, in the most expeditious manner practicable, the Merger and the other
Transactions, including (i)&nbsp;obtaining all consents, approvals, waivers,
licenses, permits or authorizations as are required to be obtained (or, which if
not obtained, would result in an event of default, termination or acceleration
of any agreement or any put right under any agreement) under any applicable law
or regulation or from any Governmental Entities or third parties in connection
with the Transactions and (ii)&nbsp;defending any lawsuits or other proceedings
challenging this Agreement.  Notwithstanding anything to the contrary contained
herein, no party hereto nor any of their Affiliates shall be required to make
any disposition of or enter into any agreement to hold separate, any Subsidiary,
asset or business, or take any other action that Parent determines could
significantly reduce the value of the Company or the benefits that Parent
expects to derive from the Merger, and the Company and its Subsidiaries shall
not agree to take any such action without the prior written consent of
Parent.</P>
<LI><A NAME="_Toc516304938"><A NAME="_Toc516304989"><A NAME="_Toc516396301"><A
NAME="_Toc516438462"><A
NAME="_Toc517021665"><U>Indemnification</A></A></U>.</A></A></A></LI>
<P>  (a)  To the fullest extent permitted under applicable law Parent shall, and
shall cause the Surviving Company to indemnify and hold harmless, each present
and former director or officer of the Company or any of its Subsidiaries and
their respective estates, heirs, personal representatives successors and assigns
(each, an &quot;<U>Indemnified Party</U>,&quot; and collectively, the
&quot;<U>Indemnified Parties</U> &quot;) against any costs or expenses
(including reasonable fees and expenses of counsel) as incurred, judgments,
fines, losses, claims, damages, liabilities and amounts paid in settlement in
connection with any claim, action, suit, proceeding or investigation, whether
civil, criminal, administrative or investigative (collectively, an
&quot;<U>Action</U>&quot;) (x) arising out of or pertaining to the Transactions,
or (y) in whole or in part on or arising in whole or in part out of the fact
that such Person is or was a director, officer or employee of the Company, with
respect to any acts or omissions occurring at or prior to the Effective Time, to
the same extent as provided in the Certificate of Incorporation or By-laws as in
effect on the date hereof, or the Company's indemnification contracts with the
Indemnified Parties (to the extent such contracts have been disclosed to Parent
and are identified in Section 5.04 of the Company Disclosure Schedule), to the
extent permitted by applicable Law in each case for a period of six years after
the date hereof.  In the event of any such Action, (whether arising before or
after the Effective Time) and subject to the specific terms of any
indemnification contract, (i)&nbsp;any counsel retained by the Indemnified
Parties for any period after the Effective Time shall be reasonably satisfactory
to the Surviving Company <FONT FACE="Times">(it being understood that Latham
&amp; Watkins is acceptable to Parent and the Surviving Corporation)</FONT>,
(ii)&nbsp;after the Effective Time, the Surviving Company shall pay the
reasonable fees and expenses of such counsel, promptly after statements therefor
are received, and (iii)&nbsp;the Surviving Company will cooperate in the defense
of any such Action; provided, however, that in the event any claim or claims for
indemnification are made within such six year period, all rights to
indemnification in respect of any such claim or claims shall continue until the
disposition of any and all such claims; provided, further, that: (A) promptly
after receipt by an Indemnified Party of notice of any such Action, the
Indemnified Party shall, if a claim in respect thereof is to be made against the
Surviving Company notify the Surviving Company in writing of this claim or the
commencement of that Action and shall deliver to Parent and the Surviving
Corporation the undertaking, if any, required by Section 145(e) of the DGCL; (B)
the Surviving Company shall be entitled to participate in the defense of any
such Action, and, to the extent it wishes, assume the defense thereof with
counsel reasonably satisfactory to the Indemnified Party or Indemnified Parties,
as the case may be; (C)&nbsp;the Surviving Company shall not, in connection with
any one such Action or separate but substantially similar or related Actions in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys at any time for all such Indemnified Parties as a
group <FONT FACE="Times">unless there is, under applicable standards of
professional conduct, a conflict between the positions of any two or more
Indemnified Parties that would preclude or render inadvisable joint or multiple
representation of such parties</FONT>; (D)&nbsp;no Indemnified Party may settle
any such Action, without the prior written consent of the Surviving Company; and
(E) the Surviving Company shall not settle any such Action, unless the
Indemnified Party that is subject of such action is fully released as a result
thereof.</P>
<P>(b)&#9;Parent shall cause to be maintained in effect for six years from the
Effective Time directors' and officers' liability insurance coverage covering
Persons who are directors and officers of the Company on the date of this
Agreement, with respect to matters occurring prior to the Effective Time, and
containing terms and conditions which are not less advantageous to such Persons
than the policies of the Company in effect on the date hereof (the
&quot;<U>Company Insurance</U>&quot;); <U>provided</U> that Parent shall not be
required to spend annually in excess of 200% of the annual premium for the
Company Insurance paid by the Company as of the date of this Agreement.  </P>
<P>(c)&#9;Nothing in this Agreement is intended to, shall be construed to or
shall release, waive or impair any rights to directors' and officers' insurance
claims under any policy that is or has been in existence with respect to the
Company or any of its officers, directors or employees, it being understood and
agreed that the indemnification provided for in this Section 5.04 is not prior
to or in substitution for any such claims under such policies.</P>
<LI><A NAME="_Toc516304939"><A NAME="_Toc516304990"><A NAME="_Toc516396302"><A
NAME="_Toc516438463"><A NAME="_Toc517021666"><U>Public
Announcements</A></A></U>.</A></A></A></LI>
<P>  Neither Parent and Merger Sub, on the one hand, nor the Company, on the
other hand, will issue any press release or public statement with respect to the
Transactions without the other party's prior consent (such consent not to be
unreasonably withheld or delayed), except as may be required by applicable law,
court process or by obligations pursuant to any agreement with any securities
exchange or quotation system on which securities of the disclosing party are
listed or quoted.  In addition to the foregoing, Parent, Merger Sub and the
Company will consult with each other before issuing, and provide each other the
opportunity to review and comment upon, any such press release or other public
statements with respect to such transactions.  The parties agree that the
initial press release or releases to be issued with respect to the Transactions
shall be mutually agreed upon prior to the issuance thereof.  The provisions of
this Section 5.05 shall not affect the obligations of the parties under Section
5.02 hereof or under the Confidentiality Agreement.</P>
<LI><A NAME="_Toc516304941"><A NAME="_Toc516304992"><A NAME="_Toc516396304"><A
NAME="_Toc516438464"><A NAME="_Toc517021667"><U>No
Solicitation</A></A></U>.</A></A></A></LI>
<P>  Neither the Company nor any of its Subsidiaries shall (whether directly or
indirectly through advisors, agents or other intermediaries), nor shall the
Company or any of its Subsidiaries authorize or permit any of its or their
officers, directors, agents, representatives, advisors or Subsidiaries to, (a)
solicit, initiate or take any action knowingly to facilitate the submission of
inquiries, proposals or offers from any Person (other than Merger Sub or Parent)
relating to (i)&nbsp;any acquisition or purchase of 15% or more of the
consolidated assets of the Company and its Subsidiaries or of over 15% of any
class of equity securities of the Company or any of its Subsidiaries,
(ii)&nbsp;any tender offer (including a self tender offer) or exchange offer
that if consummated would result in any Person beneficially owning 15% or more
of any class of equity securities of the Company or any of its Subsidiaries, or
(iii)&nbsp;any merger, consolidation, business combination, sale of
substantially all assets, recapitalization, liquidation, dissolution or similar
transaction involving the Company or any of its Subsidiaries whose assets,
individually or in the aggregate, constitute more than 15% of the consolidated
assets of the Company other than the Transactions (collectively,
&quot;<U>Transaction Proposals</U>&quot;), or agree to or endorse any
Transaction Proposal, or (b) enter into or participate in any discussions or
negotiations regarding any actual or potential Transaction Proposal (other than
with Merger Sub or Parent), or furnish to any other Person (other than Merger
Sub or Parent), any non-public information with respect to its business,
properties or assets in connection with any actual or potential Transaction
Proposal, or otherwise knowingly assist or participate in, cooperate with,
facilitate or encourage, any effort or attempt by any other Person (other than
Merger Sub or Parent) to do or seek any of the foregoing; <U>provided</U>,
<U>however</U>, that neither the foregoing nor any provision of this Agreement
shall prohibit the Company (either directly or indirectly through advisors,
agents or other intermediaries), from taking any of the following actions in the
event a Third Party has made a bona fide Transaction Proposal that the Company's
board of directors determines in good faith could result in a Superior Proposal,
subject in each case to compliance with the other provisions of this Section
5.06: (A) furnishing information pursuant to an appropriate confidentiality
letter (which letter shall not be less favorable to the Company in any material
respect than the Confidentiality Agreement) concerning the Company and its
businesses, properties or assets to such Third Party, (B) engaging in
discussions or negotiations with such Third Party, (C) taking and disclosing to
its stockholders a position as required by Rule 14d-9 or Rule 14e-2(a) under the
Exchange Act, or (D) failing to make or withdrawing or modifying its
recommendation referred to in Sections 2.21 and 5.01(c), but in each case
referred to in clauses (A) through (D) only to the extent that the board of
directors of the Company shall have concluded in good faith in consultation with
outside counsel that the failure to take such action would violate the fiduciary
duties of the board of directors of the Company to the stockholders of the
Company under applicable law; <U>provided</U>, <U>further</U>, that the board of
directors of the Company shall not take any of the foregoing actions referred to
in clauses (A) through (D) until after reasonable notice to Parent with respect
to such action.  If the board of directors of the Company receives a Transaction
Proposal, then the Company shall promptly inform Parent of all of the material
terms and conditions of such proposal and the identity of the Person making it
and shall keep Parent informed on a prompt and current basis of the status,
terms and content of any discussions regarding such Transaction Proposal,
including any changes to the terms of such Transaction Proposal.  The Company
will immediately cease and cause its advisors, agents and other intermediaries
to cease any and all existing activities, discussions or negotiations with any
parties conducted heretofore with respect to any actual or potential Transaction
Proposal, and shall use its reasonable best efforts to cause any such parties in
possession of confidential information about the Company that was furnished by
or on behalf of the Company to return or destroy all such information in the
possession of any such party or in the possession of any agent or advisor of any
such party.  As used herein, a &quot;<U>Superior Proposal</U>&quot; means any of
the transactions described in clause (i), (ii)&nbsp;or (iii)&nbsp;of the
definition of Transaction Proposal (with all of the percentages included in the
definition of such term raised to 50% for purposes of this definition) with
respect to which the board of directors of the Company shall have concluded in
good faith, after consultation with its outside legal counsel and its financial
advisor(s), is reasonably capable of being completed (including the presence of
financing commitments, if applicable) and represents a financially superior
transaction for the holders of Company Common Stock to the Merger.
Notwithstanding anything to the contrary contained in this Section&nbsp;5.06 or
elsewhere in this Agreement, prior to the Effective Time, the Company may, in
connection with a possible Acquisition Proposal, refer any third party to this
Section&nbsp;5.06, Section&nbsp;7.01 and Section&nbsp;8.02 and make a copy of
such sections available to a Third Party.</P>
<LI><A NAME="_Toc516304942"><A NAME="_Toc516304993"><A NAME="_Toc516396305"><A
NAME="_Toc516438465"><A NAME="_Toc517021668"><U>Benefit
Matters</A></A>.</A></A></A></LI>
</U><P>  (a)  During the period from the Effective Time until July&nbsp;1, 2002,
employees of the Company shall participate in employee benefit plans (as defined
in Section&nbsp;3(3) of ERISA), but including any vacation or paid time off
benefits and excluding any stock compensation plans, programs and arrangements
(collectively, &quot;<U>Included Benefits</U>&quot;) maintained by Parent or the
Surviving Corporation providing benefits no less favorable, in the aggregate,
than <FONT FACE="Times">those benefits provided under the Included Benefits of
the Company in effect on the date hereof</FONT>.  Notwithstanding the foregoing,
the standard for maintenance of benefits shall apply to the Company's Holiday
Bonus Plan only until December&nbsp;31, 2001.</P>
<P>(b)&#9;Parent will cause the Surviving Corporation to (i)&nbsp;waive all
limitations as to preexisting conditions, exclusions and waiting periods with
respect to participation and coverage requirements applicable to the employees
of the Company under any Parent welfare plan that such employees may be eligible
to participate in after the Effective Time and (ii)&nbsp;provide each employee
of the Company with credit for any co-payments and deductibles paid prior to the
Effective Time in satisfying any applicable deductible or out-of-pocket
requirements under any Parent welfare plans that such employees are eligible to
participate in after the Effective Time.</P>
<P>(c)&#9;On and after the Effective Time, Parent shall cause the Surviving
Company and any employee benefit plans maintained by Parent or the Surviving
Company in which employees of the Company and Subsidiaries participate to
recognize the service with the Company and Subsidiaries of each such employee
for purposes of determining entitlement to vacation and vacation pay and for
purposes of vesting and eligibility under any employee benefit plan, but not for
purposes of benefit accrual under any &quot;employee pension benefit plan&quot;
as defined in Section 3(2) of ERISA.  Such service shall be determined in
accordance with the practices and procedures of the Company and the Company
Plans in effect immediately prior to the Effective Time, as if such service had
been rendered to Parent.</P>
<LI><A NAME="_Toc516304943"><A NAME="_Toc516304994"><A NAME="_Toc516396306"><A
NAME="_Toc516438466"><A NAME="_Toc517021669"><U>Stock Exchange
Listing</A></A></U>.</A></A></A></LI>
<P>  Parent shall use all reasonable efforts to cause the shares of Parent
Common Stock to be issued in the Merger and the shares of Parent Common Stock to
be reserved for issuance upon exercise of Company Stock Options, Company
Warrants and the Convertible Notes to be approved for listing on the NYSE.  </P>
<LI><A NAME="_Toc516304944"><A NAME="_Toc516304995"><A NAME="_Toc516396307"><A
NAME="_Toc516438467"><A NAME="_Toc517021670"><U>Letters of the Company's
Accountants</A></A></U>.</A></A></A></LI>
<P>  The Company shall use its reasonable best efforts to cause to be delivered
to Parent a comfort letter of Ernst &amp; Young LLP, the Company's independent
public accountants, dated a date within two business days before the Form S-4
shall become effective and a comfort letter of Ernst &amp; Young LLP dated a
date within two business days before the Closing Date, each addressed to Parent,
in form and substance reasonably satisfactory to Parent and customary in scope
and substance for letters delivered by independent public accountants in
connection with registration statements similar to the Form S-4.</P>
<LI><A NAME="_Toc517021671"><U>Rights Agreement</U>.</A></LI>
<P>  The board of directors of the Company shall take all action (in addition to
that referred to in Section 2.23 hereof) necessary or desirable (including
amending the Rights Agreement) in order to render the Rights inapplicable to the
Merger and the other Transactions.  Except in connection with the foregoing
sentence, the board of directors of the Company shall not, without the prior
written consent of Parent, (a) amend the Rights Agreement or (b) take any action
with respect to, or make any determination under, the Rights Agreement, in each
case in order to facilitate any Transaction Proposal.</P>
<LI><A NAME="_Toc517021672"><U>Convertible Notes</U>.</A></LI>
<P>  Prior to the Effective Time, the board of directors of the Company shall
take all action necessary to determine that the provisions referred to in
Sections 1.11(a)(i) and 1.11(a)(ii) hereof shall constitute all such provisions
as are necessary to protect the interest of the holders of the Convertible Notes
pursuant to the terms thereof, including without limitation pursuant to Section
8.04(a) of the Convertible Notes Indenture.  </P>
<LI><A NAME="_Toc517021673"><U>Non-solicitation of Employees</U>.</A></LI>
<P>  Each of Parent and the Company agrees that for a period of one (1) year
following a termination of this Agreement, such party shall not, and shall cause
its Subsidiaries not to, raid the employees employed by the other party or its
Subsidiaries, in violation of California legal principles.  For the avoidance of
doubt, the foregoing provision will not prevent a party from hiring any employee
(a) as a result of a general public solicitation or a solicitation conducted
through a third-party recruiter or similar agent to whom the soliciting party
has not identified such employee, (b) who contacts such soliciting party on his
or her own initiative without any solicitation from the soliciting party, or (c)
who has not been employed by the other party during the preceding six (6)
months.   </P>
<LI><A NAME="_Toc517021674"><U>Stock Options</U>.</A></LI></OL>
</OL>

<P>  In the event the Parent or any of its Subsidiaries terminates the
employment of any employee of the Company without cause within ninety (90) days
after the Effective Time, Parent will cause all vested Parent Stock Options
issued pursuant to Section 1.10 hereof held by such terminated employee to be
amended to provide that the exercise period for such vested Parent Stock Options
shall be extended so as to permit their exercise by such terminated employee for
a period of twelve (12) months after the date of his or her termination of
employment; <U>provided</U>, <U>however</U>, that any such amendment to a Parent
Stock Option intended to qualify as an &quot;incentive stock option&quot; within
the meaning of Section 421 of the Code shall be subject to the consent of such
terminated employee.  For the avoidance of doubt, this Section 5.13 does not
provide for any changes to the vesting provisions contained in any Parent Stock
Option.</P>
<P ALIGN="CENTER"><LI><A NAME="_Toc516304946"><A NAME="_Toc516304997"><U><BR>
<BR>
<A NAME="_Toc516396309"><A NAME="_Toc516438468"><A
NAME="_Toc517021675">CONDITIONS PRECEDENT</A></A></A></A></A></LI></P>
<OL>

<OL>

<LI><A NAME="_Toc516304947"><A NAME="_Toc516304998"><A NAME="_Toc516396310"><A
NAME="_Toc516438469"><A NAME="_Toc517021676">Conditions to Each Party's
Obligation To Effect the Merger</A></A></U>.</A></A></A></LI>
<P>  The respective obligation of each party to effect the Merger is subject to
the satisfaction or waiver on or prior to the Closing Date of the following
conditions:</P>
<OL TYPE="a">

<U><LI>Company Stockholder Approval</U>.  The Company Stockholder Approval shall
have been obtained.</LI>
<U><LI>Antitrust</U>.  All waiting periods applicable to the consummation of the
Merger under the HSR Act shall have expired or been terminated, and all
clearances and approvals required to be obtained in respect of the Merger prior
to the Effective Time under any other similar applicable Law shall have been
obtained;</LI>
<U><LI>No Injunctions or Restraints</U>.  No temporary restraining order,
preliminary or permanent injunction or other order issued by any court of
competent jurisdiction or other legal restraint or prohibition preventing the
consummation of the Merger shall be in effect; <U>provided</U>, <U>however</U>,
that the parties hereto shall use their best efforts to have any such
injunction, order, restraint or prohibition vacated.</LI>
<U><LI>Form S-4</U>.  The Form S-4 shall have become effective under the
Securities Act and shall not be the subject of any stop order or proceedings
seeking a stop order, and any material &quot;blue sky&quot; and other state
securities laws applicable to the registration and qualification of the Parent
Common Stock issuable or required to be reserved for issuance pursuant to this
Agreement shall have been complied with.  </LI>
<U><LI>NYSE Listing</U>.  The shares of Parent Common Stock to be issued in the
Merger and reserved for issuance upon exercise of Company Stock Options, Company
Warrants and the Convertible Notes shall have been approved for listing on the
NYSE.</LI>
<U><LI>Tax Opinion</U>.  Parent shall have received from Simpson Thacher &amp;
Bartlett, counsel to Parent, and the Company shall have received from Latham
&amp; Watkins, counsel to the Company, on the Closing Date opinions that the
Merger will qualify for United States federal income tax purposes as a
reorganization within the meaning of Section&nbsp;368(a) of the Code.  The
issuance of such opinions shall be conditioned upon the receipt by such tax
counsel of customary representation letters from each of the Company, Parent and
Sub dated as of the Closing Date and as of the date that the Form S-4 filed with
the SEC becomes effective, substantially in the forms attached hereto as
Exhibits&nbsp;6.01(f)-A and 6.01(f)-B.</LI></OL>

<LI><A NAME="_Toc516304948"><A NAME="_Toc516304999"><A NAME="_Toc516396311"><A
NAME="_Toc516438470"><A NAME="_Toc517021677"><U>Conditions to Obligations of
Parent and Merger Sub</A></A></U>.</A></A></A></LI>
<P>  The obligations of Parent and Merger Sub to effect the Merger are further
subject to the following conditions: </P>
<OL TYPE="a">

<U><LI>Representations and Warranties</U>.  The representations and warranties
of the Company contained in this Agreement (i)&nbsp;that are qualified as to
Company Material Adverse Effect shall be true and correct and (ii)&nbsp;that are
not so qualified shall be true and correct in all material respects, as of the
date of this Agreement and as of the Effective Time, with the same force and
effect as if made on and as of the Effective Time, except for those
representations and warranties which address matters only as of a particular
date (which shall have been so true and correct as of such date).  Parent shall
have received a certificate signed on behalf of the Company by the chief
financial officer of the Company to the effect set forth in this Section
6.02(a).</LI>
<U><LI>Performance of Obligations of the Company</U>.  The Company shall have
performed in all material respects all obligations required to be performed by
it under this Agreement at or prior to the Closing Date.  Parent shall have
received a certificate signed on behalf of the Company by the chief executive
officer, the president and the chief financial officer of the Company to the
effect set forth in this Section 6.02(b).</LI>
<U><LI>Consents, etc</U>.  Parent and Merger Sub shall have received evidence,
in form and substance reasonably satisfactory to it, that such licenses,
permits, consents, approvals, authorizations, qualifications and orders of
(i)&nbsp;any Governmental Entities and (ii)&nbsp;any other Governmental Entities
or third parties as are necessary in connection with the Transactions have been
obtained, except in the case of clause (ii)&nbsp;where the failure to obtain
such licenses, permits, consents, approvals, authorizations, qualifications and
orders could not, individually or in the aggregate with all other failures,
reasonably be expected to have a Company Material Adverse Effect.</LI>
<U><LI>No Litigation</U>.  There shall not be pending or threatened by any
Governmental Entity any suit, action or proceeding (i)&nbsp;challenging or
seeking to restrain or prohibit the consummation of the Transactions or seeking
to obtain from the Company, Parent, Merger Sub or any of their Affiliates any
damages that would reasonably be expected to have a Company Material Adverse
Effect, (ii)&nbsp;seeking to prohibit or limit the ownership or operation by the
Company, Parent or any of their respective Subsidiaries of any material portion
of the business or assets of the Company and its Subsidiaries taken as a whole
or to dispose of or hold separate any material portion of the business or assets
of the Company and its Subsidiaries taken as a whole, as a result of the
Transactions, (iii)&nbsp;seeking to impose limitations on the ability of Parent
to acquire or hold, or exercise full rights of ownership of, any shares of the
common stock of the Surviving Corporation, including, without limitation, the
right to vote such common stock on all matters properly presented to the
stockholders of the Surviving Corporation or (iv)&nbsp;seeking to prohibit
Parent or any of its Subsidiaries from effectively controlling in any material
respect the business or operations of the Company and its Subsidiaries taken as
a whole.  </LI>
<U><LI>Rights Agreement</U>.  None of the events described in Section 3 of the
Rights Agreement shall have occurred, and the Rights shall not have become
nonredeemable and shall not become nonredeemable upon consummation of the
Merger. </LI></OL>

<LI><A NAME="_Toc516304949"><A NAME="_Toc516305000"><A NAME="_Toc516396312"><A
NAME="_Toc516438471"><A NAME="_Toc517021678"><U>Conditions to Obligation of the
Company</A></A></U>.</A></A></A></LI>
<P>  The obligation of the Company to effect the Merger is further subject to
the following conditions:</P>
<OL TYPE="a">

<U><LI>Representations and Warranties</U>.  The representations and warranties
of the Parent and Merger Sub contained in this Agreement (i)&nbsp;that are
qualified as to Parent Material Adverse Effect shall be true and correct and
(ii)&nbsp;that are not so qualified shall be true and correct in all material
respects, as of the date of this Agreement and as of the Effective Time, with
the same force and effect as if made on and as of the Effective Time, except for
those representations and warranties which address matters only as of a
particular date (which shall have been true and correct as of such date).  The
Company shall have received a certificate signed on behalf of Parent and Merger
Sub by an authorized officer of Parent and Merger Sub to the effect set forth in
this Section 6.03(a).</LI>
<U><LI>Performance of Obligations of Parent and Merger Sub</U>.  Parent and
Merger Sub shall have performed in all material respects all obligations
required to be performed by each of them under this Agreement at or prior to the
Closing Date.  The Company shall have received a certificate signed on behalf of
Parent and Merger Sub by an authorized officer of Parent and Merger Sub to the
effect set forth in this Section 6.03(b).</LI></OL>
</OL>
</OL>

<P ALIGN="CENTER"><LI><A NAME="_Toc516304950"><A NAME="_Toc516305001"><U><BR>
<BR>
<A NAME="_Toc516396313"><A NAME="_Toc516438472"><A
NAME="_Toc517021679">TERMINATION, AMENDMENT AND
WAIVER</A></A></A></A></A></LI></P>
<OL>

<OL>

<LI><A NAME="_Toc516304951"><A NAME="_Toc516305002"><A NAME="_Toc516396314"><A
NAME="_Toc516438473"><A
NAME="_Toc517021680">Termination</A></A></U>.</A></A></A></LI>
<P>  This Agreement may be terminated and abandoned at any time prior to the
Effective Time, whether before or after the Company Stockholder Approval:</P>
<OL TYPE="a">

<LI>by mutual written consent of Parent and the Company; </LI>
<LI>by either Parent or the Company if any Governmental Entity shall have issued
an order, decree or ruling or taken any other action permanently enjoining,
restraining or otherwise prohibiting the Merger and such order, decree, ruling
or other action shall have become final and nonappealable;</LI>
<LI>by either Parent or the Company if the Merger shall not have been
consummated on or before December 31, 2001 (other than due to the failure of the
party seeking to terminate this Agreement to perform its obligations under this
Agreement required to be performed at or prior to the Effective Time);</LI>
<LI>by either Parent or the Company if at the duly held meeting of the
stockholders of the Company (including any adjournment thereof) held for the
purpose of voting on the Merger, this Agreement and the consummation of the
Transactions, the holders of a majority of the outstanding shares of Company
Common Stock shall not have approved the Merger, this Agreement and the
consummation of the Transactions; </LI>
<LI>by Parent, if the Company or its board of directors shall have
(i)&nbsp;withdrawn, modified or amended in any respect adverse to Parent its
approval or recommendation of this Agreement or any of the Transactions,
(ii)&nbsp;failed as promptly as practicable after the Form S-4 is declared
effective to mail the Proxy Statement to its stockholders or failed to include
in such statement such recommendation, (iii)&nbsp;approved or recommended any
Transaction Proposal from a Third Party, (iv)&nbsp;resolved to do any of the
foregoing or (v)&nbsp;in response to the commencement of any tender offer or
exchange offer for more than 15% of the outstanding shares of Company Common
Stock, not recommended rejection of such tender offer or exchange offer;</LI>
<LI>by the Company, if, pursuant to and in compliance with Section 5.06 hereof,
the board of directors of the Company concludes in good faith, in consultation
with outside counsel, that in order to avoid violating the fiduciary duties of
the board of directors of the Company to the stockholders of the Company under
the DGCL, the board of directors must not make or must withdraw or modify its
recommendation referred to in Section 2.21 and the board of directors does not
make or withdraws or modifies such recommendation, <U>provided</U> that the
Company shall give Parent three (3) business days irrevocable written notice
prior to such termination taking effect; or </LI>
<LI>(i)&nbsp;by the Company, if Parent breaches any of its representations,
warranties, covenants or agreements contained in this Agreement the result of
which breach is that the conditions in Section 6.03 would not be satisfied and,
with respect to any such breach that is reasonably capable of being remedied,
the breach is not remedied within 30 days after the Company has furnished Parent
with written notice of such breach or (ii)&nbsp;by Parent, if the Company
breaches any of its representations, warranties, covenants or agreements
contained in this Agreement the result of which breach is that the conditions in
Section&nbsp;6.02 would not be satisfied and, with respect to any such breach
that is reasonably capable of being remedied, the breach is not remedied within
30 days after Parent has furnished the Company with written notice of such
breach.</LI></OL>

<LI><A NAME="_Toc516304952"><A NAME="_Toc516305003"><A NAME="_Toc516396315"><A
NAME="_Toc516438474"><A NAME="_Toc517021681"><U>Effect of
Termination</A></A></U>.</A></A></A></LI>
<P>  In the event of termination of this Agreement by either the Company or
Parent as provided in Section 7.01, this Agreement shall forthwith become void
and have no effect, without any liability or obligation on the part of Parent,
Merger Sub or the Company, other than the provisions of Sections 2.19, 3.10, the
penultimate sentence of 5.02, 5.12, 8.02 and 8.07 hereof, and this Section 7.02.
Nothing contained in this Section shall relieve any party for any breach of the
representations, warranties, covenants or agreements set forth in this
Agreement.</P>
<LI><A NAME="_Toc516304953"><A NAME="_Toc516305004"><A NAME="_Toc516396316"><A
NAME="_Toc516438475"><A
NAME="_Toc517021682"><U>Amendment</A></A></U>.</A></A></A></LI>
<P>  This Agreement may be amended by the parties at any time before or after
any required approval of matters presented in connection with the Merger by the
stockholders of the Company; <U>provided</U>, <U>however</U>, that after any
such approval, there shall be made no amendment that by law requires further
approval by such stockholders without the further approval of such stockholders.
This Agreement may not be amended except by an instrument in writing signed on
behalf of each of the parties.</P>
<LI><A NAME="_Toc516304954"><A NAME="_Toc516305005"><A NAME="_Toc516396317"><A
NAME="_Toc516438476"><A NAME="_Toc517021683"><U>Extension;
Waiver</A></A></U>.</A></A></A></LI>
<P>  At any time prior to the Effective Time, the parties may (a) extend the
time for the performance of any of the obligations or other acts of the other
parties, (b) waive any inaccuracies in the representations and warranties
contained in this Agreement or in any document delivered pursuant to this
Agreement or (c) subject to the proviso contained in Section 7.03 hereof, waive
compliance with any of the agreements or conditions contained in this Agreement.
Any agreement on the part of a party to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed on behalf of such
party.  The failure of any party to this Agreement to assert any of its rights
under this Agreement or otherwise shall not constitute a waiver of such
rights.</P>
<LI><A NAME="_Toc516304955"><A NAME="_Toc516305006"><A NAME="_Toc516396318"><A
NAME="_Toc516438477"><A NAME="_Toc517021684"><U>Procedure for Termination,
Amendment, Extension or Waiver</A></A></U>.</A></A></A></LI></OL>
</OL>

<P>  A termination of this Agreement pursuant to Section 7.01, an amendment of
this Agreement pursuant to Section 7.03 or an extension or waiver pursuant to
Section 7.04 shall, in order to be effective, require in the case of Parent,
Merger Sub or the Company, action by its board of directors or the duly
authorized designee of its board of directors.</P>
<P ALIGN="CENTER"><LI><A NAME="_Toc516304956"><A NAME="_Toc516305007"><U><BR>
<BR>
<A NAME="_Toc516396319"><A NAME="_Toc516438478"><A NAME="_Toc517021685">GENERAL
PROVISIONS</A></A></A></A></A></LI></P>
<OL>

<OL>

<LI><A NAME="_Toc516304957"><A NAME="_Toc516305008"><A NAME="_Toc516396320"><A
NAME="_Toc516438479"><A NAME="_Toc517021686">Nonsurvival of Representations and
Warranties</A></A></U>.</A></A></A></LI>
<P>  None of the representations and warranties in this Agreement or in any
instrument delivered pursuant to this Agreement shall survive the Effective Time
and all such representations and warranties will be extinguished on consummation
of the Merger and neither the Company, the Parent, Merger Sub, nor any officer,
director or employee or shareholder of any of them shall be under any liability
whatsoever with respect to any such representation or warranty after such time.
This Section 8.01 shall not limit any covenant or agreement of the parties that
by its terms contemplates performance after the Effective Time.</P>
<LI><A NAME="_Toc516304958"><A NAME="_Toc516305009"><A NAME="_Toc516396321"><A
NAME="_Toc516438480"><A NAME="_Toc517021687"><U>Fees and
Expenses</A></A>.</A></A></A></LI>
</U><P>  (a)  (i)&nbsp; If this Agreement shall have been terminated by either
party pursuant to Section 7.01(d) or by Parent pursuant to Section 7.01(g)(ii)
as a result of a willful breach by the Company of this Agreement following the
occurrence of any event specified in clause&nbsp;(x) below) <U>and</U> the
following shall have occurred: </P>
<P>(x) prior to such termination, any Person (or group of Persons) other than
Parent and its Affiliates (a &quot;<U>Third Party</U>&quot;) shall have made, or
proposed, communicated or disclosed in a manner which is or otherwise becomes
public a bona fide intention to make a Transaction Proposal (including by making
or effecting such a Transaction Proposal) <U>and</U> </P>
<P>(y) on or prior to twelve (12) months after the date of such termination, a
Third Party consummates a transaction the proposal of which would otherwise
qualify as a Transaction Proposal under Section 5.06 or the Company enters into
a definitive agreement with a Third Party setting forth the terms of a
transaction the proposal of which would otherwise qualify as a Transaction
Proposal under Section 5.06 hereof (whether or not such Person is the Person
referred to in clause (x) above); or </P>
<P>(ii)&#9;if this Agreement is terminated pursuant to Section 7.01(e) or
Section&nbsp;7.01(f); </P>
<P>then the Company shall, (1) in the case of clause (a)(ii)&nbsp;above,
promptly, but in no event later than one (A)&nbsp;business day after the
termination of this Agreement pursuant to Section&nbsp;7.01(e) or (B)&nbsp;the
date of termination in the case of a termination under Section&nbsp;7.01(f) and
(2) in the case of clause (a)(i) above, promptly, but in no event later than one
business day after an event specified in subclause (y) thereof shall have
occurred, pay Parent a fee in cash of $5,600,000 plus out-of-pocket fees and
expenses incurred by Parent not exceeding $900,000, which amount shall be
payable in same day funds.  No termination of this Agreement shall be effective
until such fee is paid.  For purposes of clauses&nbsp;(a)(i)(y) above, the term
&quot;Takeover Proposal&quot; shall have the same meaning assigned to such term
in Section&nbsp;5.06 except that all references therein to &quot;15%&quot; shall
be deemed to be references to &quot;35%.&quot;</P>
<P>(b)&#9;Except as provided otherwise in Section 7.02(a) above, all costs and
expenses incurred in connection with this Agreement and the Transactions shall
be paid by the party incurring such expenses, except that the cost of filing,
printing and distributing the Proxy Statement and the Form S-4 shall be borne
seventy-five percent (75%) by Parent and twenty-five percent (25%) the
Company.</P>
<LI><A NAME="_Toc516304959"><A NAME="_Toc516305010"><A NAME="_Toc516396322"><A
NAME="_Toc516438481"><A
NAME="_Toc517021688"><U>Notices</A></A></U>.</A></A></A></LI>
<P>  All notices, requests, claims, demands and other communications under this
Agreement shall be in writing and shall be deemed given if delivered personally
or sent by overnight courier (providing proof of delivery) to the parties at the
following addresses (or at such other address for a party as shall be specified
by like notice):</P>
<OL TYPE="a">

<LI>if to Parent or Merger Sub, to</LI>
<P>Applera Corporation<BR>
301 Merrit 7<BR>
Norwalk, CT 06851-1070<BR>
Attention: General Counsel</P>
<P>with a copy to:</P>
<P>Simpson Thacher &amp; Bartlett<BR>
3330 Hillview Avenue<BR>
Palo Alto, CA 94304<BR>
Attention:  Richard Capelouto, Esq.</P>
<LI>if to the Company, to</LI></OL>

<P>Axys Pharmaceuticals, Inc.<BR>
180 Kimball Way<BR>
South San Francisco, CA  94080<BR>
Attention: General Counsel</P>
<P>with a copy to:</P>
<P><A NAME="_Toc516304961"><A NAME="_Toc516305012">Latham &amp; Watkins<BR>
135 Commonwealth Drive<BR>
Menlo Park, CA 94025<BR>
Attention:  Ora T. Fisher, Esq.</P>
<LI><A NAME="_Toc516396323"><A NAME="_Toc516438482"><A
NAME="_Toc517021689"><U>Interpretation</A></A></U>.</A></A></A></LI>
<P>  When a reference is made in this Agreement to a Section, Exhibit or
Schedule, such reference shall be to a Section of, or an Exhibit or Schedule to,
this Agreement unless otherwise indicated.  The table of contents and headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.  Whenever the words
&quot;include,&quot; &quot;includes&quot; or &quot;including&quot; are used in
this Agreement, they shall be deemed to be followed by the words &quot;without
limitation&quot;.</P>
<LI><A NAME="_Toc516304962"><A NAME="_Toc516305013"><A NAME="_Toc516396324"><A
NAME="_Toc516438483"><A
NAME="_Toc517021690"><U>Counterparts</A></A></U>.</A></A></A></LI>
<P>  This Agreement may be executed in one or more counterparts, all of which
shall be considered one and the same agreement and shall become effective when
one or more counterparts have been signed by each of the parties and delivered
to the other parties.</P>
<LI><A NAME="_Toc516304963"><A NAME="_Toc516305014"><A NAME="_Toc516396325"><A
NAME="_Toc516438484"><A NAME="_Toc517021691"><U>Entire Agreement; No Third-Party
Beneficiaries</A></A></U>.</A></A></A></LI>
<P>  This Agreement and the Confidentiality Agreement and the other agreements
referred to herein constitute the entire agreement, and supersede all prior
agreements and understandings, both written and oral, among the parties with
respect to the subject matter of this Agreement.  This Agreement, other than
Article I and Section 5.04, is not intended to confer upon any Person other than
the parties any rights or remedies.</P>
<LI><A NAME="_Toc516304964"><A NAME="_Toc516305015"><A NAME="_Toc516396326"><A
NAME="_Toc516438485"><A NAME="_Toc517021692"><U>GOVERNING
LAW</A></A></U>.</A></A></A></LI>
<P>  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF DELAWARE, REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE
GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS.</P>
<LI><A NAME="_Toc516304965"><A NAME="_Toc516305016"><A NAME="_Toc516396327"><A
NAME="_Toc516438486"><A
NAME="_Toc517021693"><U>Assignment</A></A></U>.</A></A></A></LI>
<P>  Neither this Agreement nor any of the rights, interests or obligations
under this Agreement shall be assigned, in whole or in part, by operation of law
or otherwise by any of the parties without the prior written consent of the
other parties.  Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of, and be enforceable by, the parties and
their respective successors and assigns.</P>
<LI><A NAME="_Toc516304966"><A NAME="_Toc516305017"><A NAME="_Toc516396328"><A
NAME="_Toc516438487"><A
NAME="_Toc517021694"><U>Enforcement</A></A></U>.</A></A></A></LI></OL>
</OL>
</OL>

<P>The parties agree that irreparable damage would occur in the event that any
of the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached.  It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to prevent breaches of
this Agreement and to enforce specifically the terms and provisions of this
Agreement.</P>

<P>IN WITNESS WHEREOF, Parent, Merger Sub and the Company have caused this
Agreement to be signed by their respective officers thereunto duly authorized,
all as of the date first written above.</P><DIR>
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<P>APPLERA CORPORATION</P>
<P>By: <u> /s/ Peter Barrett    </u>  </P>
<P>   Name: Peter Barrett </P>
<P>   Title: Vice President  </P>
<P>ANGEL ACQUISITION SUB, INC.</P>

<P>By: <u> /s/ Peter Barrett     </u>    </P>
<P>   Name: Peter Barrett  </P>
<P>   Title: President  </P>
<P>AXYS PHARMACEUTICALS, INC.</P>

<P>By: <u> /s/ Paul J. Hastings       </u>  </P>
<P>   Name: Paul J. Hastings  </P>
<P>   Title: President and Chief Executive
             Officer </P>

<P>&nbsp;</P>
<P>&nbsp;</P></DIR>
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