Document:

Exhibit 10.1
                                                               EXECUTION VERSION

                          AGREEMENT AND PLAN OF MERGER

                                  BY AND AMONG

                                GOAMERICA, INC.,
                             a Delaware corporation
                                  ("Acquirer"),

                         HOVRS ACQUISITION CORPORATION,
                             a Delaware corporation
                              ("HOVRS Merger Sub"),

                      HANDS ON VIDEO RELAY SERVICES, INC.,
                             a Delaware corporation
                                    ("HOVRS")

                                       AND

                                BILL M. MCDONAGH
                             ("Stockholders' Agent")

                               September 12, 2007

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                                TABLE OF CONTENTS
                                                                            Page

1.  Definitions................................................................2

2.  The Merger................................................................12

    2.1.   The Merger.........................................................12
    2.2.   Closing; Effective Time............................................13
    2.3.   Effect of the Merger...............................................13
    2.4.   Organizational Documents...........................................13
    2.5.   Corporate Governance...............................................13
    2.6.   Merger Consideration; Effect on HOVRS Securities...................14
    2.7.   Cash / Stock Election and Election Procedure.......................16
    2.8.   Exchange Procedures................................................23
    2.9.   Lost, Stolen or Destroyed HOVRS Certificates.......................26
    2.10.  Tax Consequences...................................................26
    2.11.  Taking of Necessary Action; Further Action.........................26

3.  Representations and Warranties of HOVRS...................................26

    3.1.   Organization, Standing and Power...................................27
    3.2.   Authority..........................................................27
    3.3.   Governmental Authorization.........................................28
    3.4.   Financial Statements...............................................28
    3.5.   Capital Structure..................................................28
    3.6.   Absence of Certain Changes.........................................29
    3.7.   Absence of Undisclosed Liabilities.................................30
    3.8.   Litigation.........................................................30
    3.9.   Restrictions on Business Activities................................30
    3.10.  Intellectual Property..............................................30
    3.11.  Interested Party Transactions......................................34
    3.12.  Minute Books.......................................................34
    3.13.  Complete Copies of Materials.......................................34
    3.14.  HOVRS Material Contracts...........................................34
    3.15.  Inventory..........................................................35
    3.16.  Accounts Receivable................................................35
    3.17.  Customers and Suppliers............................................35
    3.18.  Employees and Consultants..........................................36
    3.19.  Title to Property..................................................36
    3.20.  Environmental Matters..............................................36
    3.21.  Taxes    ..........................................................38
    3.22.  Employee Benefit Plans.............................................39
    3.23.  Employee Matters...................................................42
    3.24.  Insurance..........................................................42
    3.25.  Compliance With Laws...............................................43

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    3.26.  Brokers' and Finders' Fee..........................................43
    3.27.  Privacy Policies and Web Site Terms and Conditions.................43
    3.28.  International Trade Matters........................................43
    3.29.  Proxy Statement and Information Statement..........................43
    3.30.  No Other Representations...........................................44
    3.31.  Board Approval.....................................................44

4.  Representations and Warranties of Acquirer................................44

    4.1.   Organization, Standing and Power...................................45
    4.2.   Authority..........................................................45
    4.3.   Governmental Authorization.........................................46
    4.4.   Financial Statements...............................................46
    4.5.   Capital Structure..................................................47
    4.6.   Absence of Certain Changes.........................................47
    4.7.   Absence of Undisclosed Liabilities.................................48
    4.8.   Litigation.........................................................48
    4.9.   Restrictions on Business Activities................................48
    4.10.  Intellectual Property..............................................49
    4.11.  Interested Party Transactions......................................52
    4.12.  Minute Books.......................................................52
    4.13.  Complete Copies of Materials.......................................52
    4.14.  Acquirer Material Contracts........................................52
    4.15.  Inventory..........................................................53
    4.16.  Accounts Receivable................................................53
    4.17.  Customers and Suppliers............................................53
    4.18.  Employees and Consultants..........................................53
    4.19.  Title to Property..................................................54
    4.20.  Environmental Matters..............................................54
    4.21.  Taxes    ..........................................................55
    4.22.  Employee Benefit Plans.............................................56
    4.23.  Employee Matters...................................................59
    4.24.  Insurance..........................................................59
    4.25.  Compliance With Laws...............................................60
    4.26.  Brokers' and Finders' Fee..........................................60
    4.27.  Privacy Policies and Web Site Terms and Conditions.................60
    4.28.  International Trade Matters........................................60
    4.29.  Proxy Statement and Information Statement..........................60
    4.30.  Board Approval.....................................................61
    4.31.  SEC Documents......................................................61
    4.32.  Issuance of Shares.................................................62
    4.33.  HOVRS Merger Sub...................................................62
    4.34.  No Other Representations...........................................62

5.  Conduct Prior to the Effective Time.......................................63

    5.1.   Conduct of Business................................................63
    5.2.   No Solicitation....................................................66

                                        v
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6.  Additional Agreements.....................................................67

    6.1.   Proxy Statement....................................................67
    6.2.   Preliminary Proxy Statement........................................68
    6.3.   HOVRS Stockholder Approval.........................................69
    6.4.   Acquirer Stockholder Approval......................................69
    6.5.   Access to Information..............................................69
    6.6.   Confidentiality....................................................70
    6.7.   Public Disclosure..................................................70
    6.8.   Regulatory Approval; Further Assurances............................70
    6.9.   HOVRS Options......................................................70
    6.10.  Form S-8 71
    6.11.  Issuance of Securities Exempt From Registration; Blue Sky Laws.....71
    6.12.  Escrow Agreement...................................................71
    6.13.  Listing of Additional Shares.......................................71
    6.14.  Tax Matters........................................................71
    6.15.  Clearlake..........................................................72
    6.16.  Expenses 72
    6.17.  Real Property Holding Corporation..................................72
    6.18.  Rule 144 Sales.....................................................72
    6.19.  Guaranty Releases..................................................72
    6.20.  Accountants' Letters...............................................73
    6.21.  Lock-up Agreement..................................................73
    6.22.  Radvision..........................................................73
    6.23.  Disclosure Schedule................................................73

7.  Conditions to the Closing of the Merger...................................73

    7.1.   Conditions to Obligations of Each Party to Effect the Merger.......73
    7.2.   Additional Conditions to the Obligations of Acquirer...............75
    7.3.   Additional Conditions to Obligations of HOVRS......................75

8.  Termination, Amendment and Waiver.........................................77

    8.1.   Termination........................................................77
    8.2.   Effect of Termination..............................................78
    8.3.   Amendment..........................................................78
    8.4.   Extension; Waiver..................................................78

9.  Escrow and Indemnification................................................78

    9.1.   Escrow Fund........................................................78
    9.2.   Indemnification....................................................79
    9.3.   Escrow Period; Release From Escrow.................................81
    9.4.   Claims Upon Escrow Fund............................................82
    9.5.   Objections to Claims...............................................83
    9.6.   Claims by HOVRS Indemnitees........................................83
    9.7.   Resolution of Conflicts and Arbitration............................84
    9.8.   Stockholders' Agent................................................84
    9.9.   Actions of the Stockholders' Agent.................................86

                                       vi
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    9.10.  Third-Party Claims.................................................86
    9.11.  Tax Returns........................................................86
    9.12.  Tax Treatment of Indemnification Payments..........................87

10. General Provisions........................................................87

    10.1.  Notices ...........................................................87
    10.2.  Counterparts.......................................................88
    10.3.  Entire Agreement; Nonassignability; Parties in Interest............88
    10.4.  Severability.......................................................88
    10.5.  Remedies Cumulative................................................88
    10.6.  Governing Law......................................................88
    10.7.  Rules of Construction..............................................88
    10.8.  Enforcement........................................................89
    10.9.  Amendment; Waiver..................................................89
    10.10. Attorneys' Fees....................................................89
    10.11. Headings ..........................................................89

EXHIBIT 2.2            Form of Certificate of Merger
EXHIBIT 2.5(a)         Corporate Governance
EXHIBIT 2.7(c)(i)      Form of Lock-up and Registration Rights Agreement
EXHIBIT 2.7(c)(ii)     Form of Investment Representation Letter
EXHIBIT 6.3            Form of Written Consent
EXHIBIT 6.12           Form of Escrow Agreement
EXHIBIT 7.2(f)         Form of Legal Opinion of Counsel to HOVRS
EXHIBIT 7.3(f)         Form of Legal Opinion of Counsel to Acquirer
EXHIBIT 7.3(h)         Form of Amended and Restated Certificate of Incorporation

                                       vii
<PAGE>

                          AGREEMENT AND PLAN OF MERGER

      This AGREEMENT AND PLAN OF MERGER (this  "Agreement")  is made and entered
into  as of  September  12,  2007  by and  among  GOAMERICA,  INC.,  a  Delaware
corporation ("Acquirer"),  HOVRS ACQUISITION CORPORATION, a Delaware corporation
and a direct wholly owned subsidiary of Acquirer ("HOVRS Merger Sub"),  HANDS ON
VIDEO  RELAY  SERVICES,  INC.,  a Delaware  corporation  ("HOVRS"),  and BILL M.
MCDONAGH,  as the  representative  of the  stockholders of HOVRS for purposes of
this Agreement (the "Stockholders' Agent").

                                    RECITALS

      A. The boards of directors of Acquirer and HOVRS each have determined that
the  strategic  business  combination  pursuant  to the terms and subject to the
conditions  set  forth  herein  is in the best  interests  of  their  respective
companies and stockholders.

      B. The boards of directors of each of Acquirer, HOVRS Merger Sub and HOVRS
have  approved  this  Agreement,  and  deem it  advisable,  fair and in the best
interests of their respective  stockholders  that Acquirer acquire HOVRS through
the statutory merger of HOVRS Merger Sub with and into HOVRS,  pursuant to which
HOVRS will become a wholly owned subsidiary of Acquirer (the "Merger"), upon the
terms and conditions set forth herein and, in furtherance thereof, have approved
the Merger, this Agreement and the other transactions contemplated hereby.

      C. Pursuant to the Merger, among other things, each issued and outstanding
share of HOVRS common stock,  $.001 par value ("HOVRS Common  Stock"),  shall be
converted into a prorated share of the Common Merger  Consideration  (as defined
below), and each issued and outstanding share of HOVRS Series A Preferred Stock,
$.001 par value ("HOVRS  Preferred  Stock"),  shall be converted into a prorated
share of the Preferred Merger Consideration (as defined below).

      D. Acquirer and HOVRS desire to make certain representations,  warranties,
covenants and other agreements in this Agreement in connection with the Merger.

      E.  Subsequent  to the  approval of this  Agreement  by the HOVRS board of
directors  and  concurrently  with  the  execution  of this  Agreement  and as a
condition  to the  willingness  of the  Acquirer  to enter into this  Agreement,
Acquirer  has entered  into a Support and Lock-Up  Agreement,  pursuant to which
each Key HOVRS  Stockholder (as defined below) has agreed to retain ownership of
the shares of HOVRS Common Stock and HOVRS Preferred Stock beneficially owned by
such stockholder until the consummation of the Merger or the termination of this
Agreement in  accordance  with its terms and to take certain  actions to support
consummation  of the  Merger,  subject to and in  accordance  with the terms and
conditions set forth therein.

      F. Subsequent to the approval of this Agreement by the Acquirer's board of
directors  and  concurrently  with  the  execution  of this  Agreement  and as a
condition to the  willingness of HOVRS to enter into this  Agreement,  HOVRS has
entered  into a  Voting  Agreement  with the  Acquirer  stockholders  listed  on
Schedule I attached thereto, pursuant to

<PAGE>

which such  stockholders have agreed to vote the shares of Acquirer Common Stock
and Acquirer  Preferred Stock beneficially owned by such stockholder in favor of
the Merger, the issuance of the Acquirer Common Stock pursuant to this Agreement
and such other  matters as shall be  required by Nasdaq in  connection  with the
consummation of the Merger and to take certain  actions to support  consummation
of the Merger,  subject to and in accordance  with the terms and  conditions set
forth therein.

      G. It is intended that the exchange of capital stock of HOVRS for Acquirer
Common Stock in the Merger will  qualify as a tax-free  exchange of property for
stock under the provisions of Section 351 of the Internal  Revenue Code of 1986,
as amended (the "Code").

                                    AGREEMENT

      NOW, THEREFORE,  in consideration of the covenants and representations set
forth  herein,  and for other good and valuable  consideration,  the receipt and
adequacy of which is hereby acknowledged, the parties agree as follows:

1. Definitions.  For purposes of this Agreement, the following capitalized terms
shall have the following meanings:

      "Applicable Laws" means, with respect to any Person,  all laws,  statutes,
codes,  orders,  rules,  regulations,  policies or  guidelines  promulgated,  or
judgments,  decisions or orders entered by, any Governmental Entity, relating to
such  Person and its  Subsidiaries  or their  respective  businesses,  assets or
properties.

      "Acquirer"  shall  have the  meaning  set  forth in the  preamble  to this
Agreement.

      "Acquirer Balance Sheet" shall have the meaning set forth in Section 4.7.

      "Acquirer  Balance Sheet Date" shall have the meaning set forth in Section
4.6.

      "Acquirer  Common Stock" shall mean the common  stock,  par value $.01, of
Acquirer.

      "Acquirer Disclosure Schedule" shall have the meaning set forth in Section
4.

      "Acquirer  Employee  Plans"  shall have the  meaning  set forth in Section
4.22(a).

      "Acquirer  Financial  Statements"  shall  have the  meaning  set  forth in
Section 4.4.

      "Acquirer Indemnified Party" and "Acquirer Indemnified Parties" shall have
the meanings set forth in Section 9.2(b).

      "Acquirer  Individuals"  shall  have the  meaning  set  forth  in  Section
4.27(a)(ii).

      "Acquirer  Intellectual  Property"  shall  have the  meaning  set forth in
Section 4.10(b).

      "Acquirer  Material  Contract" shall have the meaning set forth in Section
4.14.

                                       2
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      "Acquirer   Option   Plans"  shall  mean,   collectively,   the  GoAmerica
Communications  Corp.  1999 Stock Option Plan,  the  GoAmerica,  Inc. 1999 Stock
Plan, the GoAmerica,  Inc. Employee Stock Purchase Plan and the GoAmerica,  Inc.
2005 Equity Compensation Plan.

      "Acquirer Preferred Stock" shall mean the preferred stock, par value $.01,
of Acquirer.

      "Acquirer Privacy  Statements" shall have the meaning set forth in Section
4.27(a)(ii).

      "Acquirer   Products"   shall  have  the  meaning  set  forth  in  Section
4.10(b)(ii).

      "Acquirer  SEC  Documents"  shall  have the  meaning  set forth in Section
4.31(a).

      "Acquirer  SEC Financial  Statements"  shall have the meaning set forth in
Section 4.31(b).

      "Acquirer's  Current  Facilities"  shall  have the  meaning  set  forth in
Section 4.20.

      "Acquirer's Facilities" shall have the meaning set forth in Section 4.20.

      "Acquirer  Sites" shall mean all of  Acquirer's  public sites on the World
Wide Web.

      "Acquirer Software" shall have the meaning set forth in Section 4.10(j).

      "Acquirer  Stockholders  Meeting"  shall  have the  meaning  set  forth in
Section 6.4.

      "Acquirer  Transaction  Proposal"  shall  have the  meaning  set  forth in
Section 5.2(c).

      "Acquirer  Unapproved Marketing Programs" shall have the meaning set forth
in Section 9.2(c).

      "Agent Certificate" shall have the meaning set forth in Section 9.6(a).

      "Agreement"  shall  have the  meaning  set forth in the  preamble  to this
Agreement.

      "Assumed  HOVRS  Option"  shall  have the  meaning  set  forth in  Section
2.6(d)(ii).

      "Business  Day"  means any day on which  banks are open to the  public for
conducting  business  and not  authorized  or required to close in the States of
California and New Jersey.

      "Cash  Consideration"  shall mean the Common  Cash  Consideration  and the
Preferred Cash Consideration.

                                       3
<PAGE>

      "Cash  Threshold  Percentage"  shall  mean the  quotient,  expressed  as a
percentage, of the Merger Cash divided by the Merger Consideration.

      "CERCLA" shall mean Comprehensive Environmental Response, Compensation and
Liability Act of 1980.

      "Certificate" and "Certificates"  shall mean a certificate or certificates
representing shares of HOVRS Common Stock or HOVRS Preferred Stock.

      "Certificate of Merger" shall have the meaning set forth in Section 2.2.

      "Charter  Documents" shall mean, with respect to any entity, such entity's
certificate  of  incorporation,   by-laws,  certificate  of  formation,  limited
liability company agreement or other charter documents, as applicable.

      "Clearlake" shall mean CCP A, L.P., a Delaware limited partnership.

      "Closing" shall have the meaning set forth in Section 2.2.

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

      "Closing  Price" shall mean the closing price of the Acquirer Common Stock
as reported on the Nasdaq Capital Market as of any specified date.

      "COBRA" shall have the meaning set forth in Section 3.22(e).

      "Code" shall have the meaning set forth in the recitals to this Agreement.

      "Common Cash Consideration"  shall mean cash equal to the Common Per Share
Price.

      "Common  Cash  Election"  shall  have the  meaning  set  forth in  Section
2.7(b)(ii).

      "Common Cash Election  Shares" shall have the meaning set forth in Section
2.7(a).

      "Common  Liquidation  Preference"  shall  mean Eight  Hundred  Forty-Three
Thousand Five Hundred Eighty-Eight Dollars ($843,588).

      "Common  Liquidation  Proceeds"  shall  mean  the  sum of (i)  the  Common
Liquidation  Preference  plus (ii) the  product  of (A) the  Shared  Liquidation
Proceeds  multiplied  by (B) a  fraction,  the  numerator  of which shall be the
number  of  issued  and  outstanding  shares  of  HOVRS  Common  Stock,  and the
denominator of which shall be the total number of issued and outstanding  shares
of  HOVRS  Common  Stock  and  HOVRS  Preferred  Stock,  in each  case as of the
Determination Date.

      "Common Merger  Consideration" shall have the meaning set forth in Section
2.6(a).

                                       4
<PAGE>

      "Common  Non-Election"  shall  have  the  meaning  set  forth  in  Section
2.7(b)(ii).

      "Common  Non-Election  Shares" shall have the meaning set forth in Section
2.7(a).

      "Common Per Share Price" shall mean the quotient of the Common Liquidation
Proceeds  divided by the number of shares of HOVRS  Common Stock that are issued
and outstanding as of the Determination Date.

      "Common Stock  Consideration"  shall mean a number of share(s) of Acquirer
Common Stock (or a fraction thereof) equal to the Common Per Share Price divided
by the Closing Price as of the Determination Date.

      "Common  Stock  Election"  shall  have the  meaning  set forth in  Section
2.7(b)(ii).

      "Common Stock Election Shares" shall have the meaning set forth in Section
2.7(a).

      "Communications Act" shall have the meaning set forth in Section 9.2(b).

      "Confidentiality  Agreement"  shall have the  meaning set forth in Section
6.6.

      "Copyrights" shall have the meaning set forth in Section 3.10(a)(iii).

      "Damages" shall have the meaning set forth in Section 9.2(b).

      "Delaware Law" means the Delaware General Corporation Law.

      "Determination  Date"  shall  mean the date that is one (1)  Business  Day
preceding the Closing Date.

      "Dissenting  Shares"  shall mean the shares of HOVRS Common Stock or HOVRS
Preferred Stock held by holders who have demanded and perfected their respective
rights for  appraisal  of such shares with  respect to the Merger in  accordance
with  Delaware  Law, and who, as of the  Effective  Time,  have not  effectively
withdrawn or lost such rights to appraisal in accordance with Delaware Law.

      "Dissenting  Stockholder"  shall  have the  meaning  set forth in  Section
2.6(h).

      "Effective Time" shall have the meaning set forth in Section 2.2.

      "Election Deadline" shall have the meaning set forth in Section 2.7(c).

      "Election Form" shall have the meaning set forth in Section 2.7(b).

      "Environmental   Laws"  shall  have  the  meaning  set  forth  in  Section
3.20(a)(i).

      "ERISA" shall mean  Employee  Retirement  Income  Security Act of 1974, as
amended.

                                       5
<PAGE>

      "ERISA Affiliate" shall have the meaning set forth in Section 3.22(a).

      "Escrow Agent" shall mean the escrow agent named in the Escrow Agreement.

      "Escrow Agreement" shall have the meaning set forth in Section 6.12.

      "Escrow Cash" shall mean Five Million Dollars ($5,000,000).

      "Escrow Fund" shall mean the Escrow Cash, plus all interest earned thereon
while held by the Escrow Agent.

      "Escrow Period" shall have the meaning set forth in Section 9.3(a).

      "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC thereunder.

      "Exchange Agent" shall mean a bank or trust company designated by Acquirer
and  reasonably  satisfactory  to HOVRS,  which shall  manage and  disburse  the
Exchange Fund in accordance herewith.

      "Exchange Fund" shall have the meaning set forth in Section 2.8(a).

      "FCC" means the U.S. Federal Communications Commission.

      "FCC Investigation" shall have the meaning set forth in Section 9.2(b).

      "FCC Letter" shall have the meaning set forth in Section 9.2(c).

      "FCC Subpoena" shall have the meaning set forth in Section 9.2(b).

      "Final Allocation" shall have the meaning set forth in Section 2.7(d).

      "GAAP" means generally accepted accounting principles in the United States
as in effect from time to time.

      "Governmental  Entity"  shall  mean any  court,  administrative  agency or
commission or other governmental authority or instrumentality.

      "Hazardous  Materials"  shall  have  the  meaning  set  forth  in  Section
3.20(a)(ii).

      "HIPAA" shall have the meaning set forth in Section 3.22(e).

      "Holdback Cash" shall mean Two Hundred Thousand Dollars ($200,000).

      "Holdback  Fund" shall mean the Holdback  Cash,  plus all interest  earned
thereon  while  held by the  Stockholders'  Agent for the  benefit  of the HOVRS
Stockholders.

      "HOVRS"  shall  have  the  meaning  set  forth  in the  preamble  to  this
Agreement.

                                       6
<PAGE>

      "HOVRS Balance Sheet" shall have the meaning set forth in Section 3.7.

      "HOVRS  Balance  Sheet  Date"  shall have the meaning set forth in Section
3.6.

      "HOVRS  Common  Stock" shall have the meaning set forth in the recitals to
this Agreement.

      "HOVRS'  Current  Facilities"  shall have the meaning set forth in Section
3.20(b).

      "HOVRS Disclosure Schedule" shall have the meaning set forth in Section 3.

      "HOVRS  Employee  Plans"  shall  have the  meaning  set  forth in  Section
3.22(a).

      "HOVRS' Facilities" shall have the meaning set forth in Section 3.20(b).

      "HOVRS Financial  Statements"  shall have the meaning set forth in Section
3.4(a).

      "HOVRS Indemnified  Party" and "HOVRS Indemnified  Parties" shall have the
meanings set forth in Section 9.2(c).

      "HOVRS Information  Statement" shall have the meaning set forth in Section
6.3.

      "HOVRS Intellectual  Property" shall have the meaning set forth in Section
3.10(c).

      "HOVRS  Material  Contract"  shall have the  meaning  set forth in Section
3.14.

      "HOVRS  Merger Sub" shall have the  meaning  set forth in the  preamble to
this Agreement.

      "HOVRS Option Plan" shall have the meaning set forth in Section 3.5(b).

      "HOVRS  Preferred  Stock" shall have the meaning set forth in the recitals
to this Agreement,  and for all purposes under this Agreement,  shall be treated
on an as-if converted basis.

      "HOVRS  Privacy  Statements"  means,  collectively,  any and all of HOVRS'
privacy  policies  published on the HOVRS Sites or otherwise  made  available by
HOVRS regarding the collection,  retention, use and distribution of the personal
information of individuals,  including, without limitation, from visitors of any
of the HOVRS Sites ("Individuals").

      "HOVRS Products" shall have the meaning set forth in Section 3.10(c)(ii).

      "HOVRS  Securities"  shall mean HOVRS Common Stock,  HOVRS Preferred Stock
and HOVRS Stock Options.

      "HOVRS Sites" shall mean all of HOVRS' public sites on the World Wide Web.

                                       7
<PAGE>

      "HOVRS Software" shall have the meaning set forth in Section 3.10(k).

      "HOVRS  Stock  Options"  shall  have the  meaning  set  forth  in  Section
2.6(d)(i).

      "HOVRS  Stockholders"  means the holders of the HOVRS Common Stock and the
HOVRS Preferred Stock, collectively.

      "HOVRS  Transaction  Proposal" shall have the meaning set forth in Section
5.2(a).

      "HOVRS Unapproved  Marketing Programs" shall have the meaning set forth in
Section 9.2(b).

      "HOVRS  Unvested  Options"  shall  have the  meaning  set forth in Section
2.6(d)(ii).

      "HOVRS  Vested  Options"  shall  have the  meaning  set  forth in  Section
2.6(d)(i).

      "Intellectual  Property"  shall  have the  meaning  set  forth in  Section
3.10(a).

      "International  Trade Law" shall mean U.S. statutes,  laws and regulations
applicable to  international  transactions,  including,  but not limited to, the
Export  Administration Act, the Export Administration  Regulations,  the Foreign
Corrupt Practices Act, the Arms Export Control Act, the International Traffic in
Arms Regulations,  the International  Emergency Economic Powers Act, the Trading
with the Enemy Act, the U.S.  Customs laws and  regulations,  the Foreign  Asset
Control Regulations, and any regulations or orders issued thereunder.

      "Issued Patents" shall have the meaning set forth in Section 3.10(a)(i).

      "Investment  Representation  Letter"  shall have the  meaning set forth in
Section 2.7(c)(ii).

      "JAMS" shall mean Judicial Arbitration and Mediation Services.

      "Key HOVRS  Stockholders"  shall mean Ronald Obray,  Denise Obray,  Edmond
Routhier, Caymus Investment Group II, LLC and Caymus Obray, LLC.

      "knowledge"  shall mean such party's  actual  knowledge  after  reasonable
inquiry of officers,  directors and other key employees of such party reasonably
believed to have knowledge of such matters.

      "Lock-up Agreement" shall have the meaning set forth in Section 2.7(c)(i).

      "Material  Adverse Effect" shall mean, with respect to any entity or group
of  entities,  any event,  change or effect  that is  materially  adverse to the
financial condition,  properties,  assets, liabilities,  business, operations or
results of  operations  of such entity and its  Subsidiaries,  taken as a whole;
provided,  however,  that a  Material  Adverse  Effect  shall  not  include  any
condition,  change,  situation or set of  circumstances or effect relating to or
resulting

                                       8
<PAGE>

from (A) any change in Applicable Law, (B) an  announcement of the  transactions
contemplated  hereunder,  (C) with respect to HOVRS any action taken by Acquirer
that is not  contemplated  hereunder or approved in advanced by HOVRS,  (D) with
respect  to  Acquirer,  any  action  taken  by  HOVRS  that is not  contemplated
hereunder or approved in advance by Acquirer,  (E) changes  generally  affecting
the telecommunications industries in which the party or its Subsidiaries operate
(except with respect to changes that disproportionately  affect the party or its
Subsidiaries relative to other participants in the industries in which the party
and its Subsidiaries  operate), (F) changes in economic conditions in the United
States (except with respect to changes that disproportionately  affect the party
or its  Subsidiaries  relative to other  participants in the  telecommunications
industries in which the party and its Subsidiaries  operate),  or (G) any attack
on, or by, outbreak or escalation of hostilities or acts of terrorism involving,
the United States,  or any  declaration of war by the United States  Congress or
any   hurricane,   earthquake   or  other   natural   disaster   that  does  not
disproportionately  affect  the  party  or its  Subsidiaries  relative  to other
participants  in the  telecommunications  industries  in which the party and its
Subsidiaries operate.

      "Merger"  shall  have  the  meaning  set  forth  in the  recitals  to this
Agreement.

      "Merger Cash" shall mean Thirty Five Million Dollars ($35,000,000),  minus
the amount by which the Transaction Expenses of HOVRS exceed One Million Dollars
($1,000,000) in the aggregate.

      "Merger Consideration" shall mean the sum of (i) the Merger Cash plus (ii)
value of  6,700,000  shares of Acquirer  Common Stock (as adjusted for any stock
splits, share dividends, combinations,  reclassifications or the like that occur
after the date of this  Agreement  with respect to such  shares)  based upon the
Closing Price of Acquirer Common Stock on the Determination Date.

      "Minimum  Cash  Election"  shall  mean,  for each  HOVRS  Stockholder,  an
election to receive at a minimum Cash  Consideration  equal to such holder's pro
rata portion of the Escrow Cash,  which pro rata shall be derived by multiplying
Five Million Two Hundred  Thousand Dollars  ($5,200,000) by a fraction,  (i) the
numerator of which shall be the number of HOVRS Common Stock or HOVRS  Preferred
Stock,  as the case may be, held by such  holder,  and (ii) the  denominator  of
which shall be the total number of HOVRS Common Stock or HOVRS  Preferred  Stock
issued and outstanding as of the Determination Date.

      "NASD" shall have the meaning set forth in Section 4.2.

      "New Certificates" shall have the meaning set forth in Section 2.8(a).

      "Officer"  shall have the meaning set forth in Rule  16a-1(f)  promulgated
under the Exchange Act.

      "Officer's Certificate" shall have the meaning set forth in Section 9.4.

      "Option   Exchange   Ratio"   means  the   quotient  of  the  Common  Cash
Consideration divided by the Closing Price as of the Determination Date.

                                       9
<PAGE>

      "Outside Date" shall have the meaning set forth in Section 8.1(b).

      "Patents" shall have the meaning set forth in Section 3.10(a)(ii).

      "Patent  Applications"  shall  have  the  meaning  set  forth  in  Section
3.10(a)(ii).

      "Person" means an individual, corporation,  partnership, limited liability
company, joint venture, association, trust, unincorporated organization or other
entity.

      "Preferred Cash Consideration"  shall mean cash equal to the Preferred Per
Share Price.

      "Preferred  Cash  Election"  shall have the  meaning  set forth in Section
2.7(b)(i).

      "Preferred  Cash  Election  Shares"  shall have the  meaning  set forth in
Section 2.7(a).

      "Preferred  Liquidation  Preference"  shall mean One Million  Five Hundred
Thousand Dollars ($1,500,000).

      "Preferred  Liquidation  Proceeds" shall mean the sum of (i) the Preferred
Liquidation  Preference  plus (ii) the  product  of (A) the  Shared  Liquidation
Proceeds  multiplied  by (B) a  fraction,  the  numerator  of which shall be the
number of  issued  and  outstanding  shares of HOVRS  Preferred  Stock,  and the
denominator of which shall be the total number of issued and outstanding  shares
of  HOVRS  Common  Stock  and  HOVRS  Preferred  Stock,  in each  case as of the
Determination Date.

      "Preferred  Merger  Consideration"  shall  have the  meaning  set forth in
Section 2.6(b).

      "Preferred  Non-Election"  shall  have the  meaning  set forth in  Section
2.7(b)(i).

      "Preferred  Non-Election  Shares"  shall  have the  meaning  set  forth in
Section 2.7(a).

      "Preferred  Per Share  Price"  shall mean the  quotient  of the  Preferred
Liquidation  Proceeds  divided by the number of shares of HOVRS  Preferred Stock
that are issued and outstanding as of the Determination Date.

      "Preferred Stock  Consideration" shall mean a number of shares of Acquirer
Common  Stock (or a fraction  thereof)  equal to the  Preferred  Per Share Price
divided by the Closing Price as of the Determination Date.

      "Preferred  Stock  Election"  shall have the  meaning set forth in Section
2.7(b)(i).

      "Preferred  Stock  Election  Shares"  shall have the  meaning set forth in
Section 2.7(a).

      "Preliminary  Proxy Statement" shall have the meaning set forth in Section
6.2.

                                       10
<PAGE>

      "Proxy Statement" shall have the meaning set forth in Section 6.1.

      "Public Software," as used in Section 3.10(m),  shall have the meaning set
forth in such section.

      "Public Software," as used in Section 4.10(l),  shall have the meaning set
forth in such section.

      "Requested  Confidential  Exhibits"  shall have the  meaning  set forth in
Section 4.31(a).

      "RCRA" shall mean Resource Conservation and Recovery Act.

      "Reserved  Escrow  Amount"  shall  have the  meaning  set forth in Section
9.3(b).

      "Reserved  Escrow  Period"  shall  have the  meaning  set forth in Section
9.3(b).

      "SEC" means the U.S. Securities and Exchange Commission.

      "Securities Act" shall mean the Securities Act of 1933 as amended, and the
rules and regulations of the SEC thereunder.

      "Shared Liquidation  Proceeds" shall mean the Merger Consideration (valued
at the  Closing  Price  as of  the  Determination  Date),  minus  the  Preferred
Liquidation Preference and the Common Liquidation Preference.

      "Stock  Consideration"  shall mean the Common Stock  Consideration and the
Preferred Stock Consideration.

      "Stock  Threshold  Percentage"  shall mean the  quotient,  expressed  as a
percentage, of (i) the market value of 6,700,000 shares of Acquirer Common Stock
(as   adjusted   for  any   stock   splits,   share   dividends,   combinations,
reclassifications  or the like that occur after the date of this  Agreement with
respect to such  shares)  based upon the Closing  Price as of the  Determination
Date divided by (ii) the Merger Consideration.

      "Stockholders'  Agent"  shall  mean  have  the  meaning  set  forth in the
preamble to this Agreement.

      "Subsidiary"  shall mean any Person of which any other Person  directly or
indirectly  owns,  beneficially  or of record,  at least 50% of the  outstanding
equity or financial interests of such entity.

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

      "Tax"  (and,  with  correlative  meaning,  "Taxes")  shall mean all taxes,
charges,  duties,  fees,  levies or other  assessments,  all of which are in the
nature of a tax, imposed by or payable to any governmental authority,  including
any  income,  gross  receipts,  capital  gains,  net  worth,  license,  payroll,
employment,  excise, severance, stamp, business,  occupation,  premium,

                                       11
<PAGE>

windfall profits, environmental (including Taxes under section 59A of the Code),
capital stock, franchise,  profits,  withholding,  social security (or similar),
unemployment,   disability,  real  property,   personal  property,   intangible,
production, sales, use, transfer,  registration, ad valorem, or value added tax,
any alternative or add-on minimum tax, any estimated tax, in each case including
any interest, penalty, or addition thereto, whether disputed or not.

      "Tax  Representation  Letter"  shall have the meaning set forth in Section
6.14.

      "Tax Return" shall mean any return, declaration, report, claim for refund,
information return or statement or other documents relating to Taxes,  including
any schedule or  attachment  thereto,  and any  amendment  thereof,  to be filed
(whether on a  mandatory  or elective  basis)  with any  governmental  authority
responsible for the imposition or collection of Taxes.

      "Terminated" shall have the meaning set forth in Section 9.3(b).

      "Termination Date" shall have the meaning set forth in Section 9.2(a).

      "Third Party Acquirer  Intellectual  Property"  shall have the meaning set
forth in Section 4.10(c).

      "Third Party HOVRS Intellectual Property" shall have the meaning set forth
in Section 3.10(d).

      "Trademarks" shall have the meaning set forth in Section 3.10(a)(iv).

      "Transaction  Expenses"  shall mean the  amount  paid or payable by either
HOVRS or the Acquirer to third parties for services  rendered in connection with
this  Agreement and the  transactions  contemplated  hereby  (including  without
limitation fees payable for investment banking,  legal, accounting and appraisal
services).

      "Unresolved  Claim  Amount"  shall have the  meaning  set forth in Section
9.3(a).

      "Verizon  Agreement"  shall mean the Asset Purchase  Agreement dated as of
August 1, 2007,  by and between MCI  Communications  Services,  Inc., a Delaware
corporation,  as seller,  and  Acquisition 1 Corp., a Delaware  corporation  and
wholly owned subsidiary of Acquirer.

      "Written Consent" shall have the meaning set forth in Section 6.3.

2. The Merger.

      2.1. The Merger.  At the Effective  Time and subject to and upon the terms
and  conditions of this  Agreement and in  accordance  with Delaware Law,  HOVRS
Merger Sub shall be merged  with and into HOVRS,  which  shall be the  surviving
corporation  (the  "Surviving  Corporation")  in the  Merger,  and the  separate
existence of HOVRS Merger Sub shall thereupon cease.

                                       12
<PAGE>

      2.2. Closing; Effective Time. The closing of the transactions contemplated
hereby (the  "Closing")  shall take place as soon as  practicable,  but no later
than five (5) Business  Days,  after the  satisfaction  or waiver of each of the
conditions set forth in Sections 7.1, 7.2 and 7.3 hereof,  or at such other time
as the parties  hereto may agree (the  "Closing  Date").  The Closing shall take
place at the offices of Orrick  Herrington & Sutcliffe,  LLP, 405 Howard Street,
The Orrick Building,  San Francisco,  California,  at 10:00 a.m. PDT, or at such
other  location or time as the parties  hereto may agree.  At the  Closing,  the
parties  hereto  shall  cause  the  Merger  to  be  consummated  by  filing  the
certificate  of merger  relating to the Merger,  in the form attached  hereto as
Exhibit 2.2 (the  "Certificate  of Merger"),  with the Secretary of State of the
State of Delaware,  in accordance  with the relevant  provisions of Delaware Law
(the  time of the  completion  of such  filing  with the  Secretary  of State of
Delaware,  or such later time as may be agreed in  writing  by the  parties  and
specified in the Certificate of Merger, being the "Effective Time").

      2.3. Effect of the Merger. At the Effective Time, the effect of the Merger
shall be as  provided  in this  Agreement,  the  Certificate  of Merger  and the
applicable  provisions of Delaware Law.  Without  limiting the generality of the
foregoing, and subject thereto, at the Effective Time, all the property, rights,
privileges,  powers and  franchises  of HOVRS and HOVRS Merger Sub shall vest in
the Surviving  Corporation,  and all debts,  liabilities and duties of HOVRS and
HOVRS Merger Sub shall become the debts, liabilities and duties of the Surviving
Corporation.

      2.4. Organizational  Documents. At the Effective Time, (i) the certificate
of  incorporation  of the  Surviving  Corporation  shall  be  amended  to be the
certificate of incorporation of HOVRS Merger Sub as in effect  immediately prior
to the Effective  Time, and as so amended,  such  certificate  of  incorporation
shall be the certificate of  incorporation  of the Surviving  Corporation  until
thereafter  changed or amended as provided  therein or pursuant to Delaware Law,
and (ii) the bylaws of HOVRS Merger Sub, as in effect  immediately  prior to the
Effective  Time,  shall  be  the  bylaws  of  the  Surviving  Corporation  until
thereafter changed or amended as provided therein or pursuant to Delaware Law.

      2.5. Corporate Governance.

            (a)  Acquirer  shall  take  all  appropriate   action  so  that  the
individuals  listed on Exhibit 2.5 hereto shall be  appointed  to the  positions
with  Acquirer set forth  thereon,  in each case,  effective as of the Effective
Time.  Except as provided in the first sentence of this Section 2.5, Officer and
other key  management  positions  with Acquirer and its  Subsidiaries,  shall be
filled  effective  as of the  Effective  Time  at the  discretion  of the  Chief
Executive  Officer of Acquirer,  subject to approval,  to the extent required by
Applicable Laws or Acquirer's  by-laws,  by Acquirer's  board of directors after
the Effective Time.  After the Effective Time,  changes in Officer and other key
management  positions  at  Acquirer  and  its  Subsidiaries  shall  be  made  in
accordance with Applicable Laws and Acquirer's by-laws as in effect from time to
time.

            (b) As of the  Effective  Time,  the board of  directors of Acquirer
shall  cause the number of  directors  that shall  constitute  the full board of
directors  of  Acquirer to be eight (8) and the number of  directors  that shall
constitute each committee of the board of directors of Acquirer in full to be at
least three (3). The members of the board of directors of Acquirer, the class of
the board of  directors of Acquirer to which each such member shall be appointed
or elected, and the

                                       13
<PAGE>

party by whom each such member shall be deemed to have been  designated,  at the
Effective Time shall be as provided in Exhibit 2.5 attached hereto. Prior to the
Effective  Time,  the director  designees  identified  on Exhibit 2.5 shall,  by
majority vote, designate the eighth member of the board of directors of Acquirer
to be appointed  or elected as of the  Effective  Time  pursuant to this Section
2.5(b) and,  upon  delivery of such  designation  to the board of  directors  of
Acquirer and HOVRS,  Exhibit 2.5 shall be deemed  amended to include the name of
such designee. Such eighth member of the board of directors of Acquirer to be so
designated  shall qualify as an "independent  director" with respect to Acquirer
within the meaning of Rule  4200(a)(15) of the  Marketplace  Rules of The NASDAQ
Stock Market LLC.

            (c) Subject to the  approval  of its  stockholders  at the  Acquirer
Stockholders Meeting,  Acquirer shall undertake commercially  reasonable efforts
to eliminate its classified  board structure.  If such  stockholder  approval is
obtained,  the director designees  identified on Exhibit 2.5 shall all be of the
same class and shall all serve one-year terms. If such  stockholder  approval is
not obtained, the director designees shall serve in the classes noted on Exhibit
2.5 for terms  expiring at such time as the terms of  directors  of the relevant
class expire in the normal course consistent with Acquirer's past practices.

      2.6. Merger  Consideration;  Effect on HOVRS Securities.  At the Effective
Time,  by virtue of the Merger and without  any action on the part of  Acquirer,
HOVRS Merger Sub, HOVRS or the holders of any of the following securities:

            (a)  Conversion  of HOVRS Common  Stock.  Each share of HOVRS Common
Stock  issued and  outstanding  immediately  prior to the  Effective  Time shall
become and be converted  into, as provided in and subject to the limitations set
forth in this  Agreement,  the right to  receive at the  election  of the holder
thereof as provided in Section 2.7 either (i) the Common Cash Consideration,  or
(ii) the Common  Stock  Consideration.  The Common  Cash  Consideration  and the
Common Stock  Consideration are sometimes referred to herein collectively as the
"Common Merger Consideration."

            (b)  Conversion  of  HOVRS  Preferred  Stock.  Each  share  of HOVRS
Preferred Stock issued and outstanding  immediately  prior to the Effective Time
shall  become  and  be  converted  into,  as  provided  in  and  subject  to the
limitations set forth in this Agreement, the right to receive at the election of
the holder  thereof as  provided in Section  2.7 either (i) the  Preferred  Cash
Consideration,  or (ii) the Preferred  Stock  Consideration.  The Preferred Cash
Consideration and the Preferred Stock  Consideration  are sometimes  referred to
herein collectively as the "Preferred Merger Consideration."

            (c)  Cancellation  of HOVRS Common Stock and HOVRS  Preferred  Stock
Owned by HOVRS.  Each share of HOVRS Common Stock and HOVRS Preferred Stock (and
each other security of HOVRS) that is held by HOVRS or is owned by any direct or
indirect  wholly owned  subsidiary of HOVRS  immediately  prior to the Effective
Time shall be cancelled and extinguished without any conversion thereof.

                                       14
<PAGE>

            (d) HOVRS Options.

                  (i) Vested Options. HOVRS shall take all action required under
the HOVRS Option Plan reasonably necessary so that on the Determination Date all
outstanding  stock options (the "HOVRS Stock  Options")  granted under the HOVRS
Option Plan or pursuant to any employment or other  agreement that are vested or
become  vested as a result of the  Merger  in  accordance  with its terms or any
other  agreement (the "HOVRS Vested  Options")  shall be exercised in accordance
with the terms of the HOVRS Option Plan; provided,  however, that any such HOVRS
Vested  Options  that are not  exercised on or prior to the  Determination  Date
shall be cancelled and become null and void and of no further force or effect as
of the Effective  Time.  Shares issued upon exercise of the HOVRS Vested Options
shall be treated for all  purposes of this  Agreement as  outstanding  shares of
HOVRS Common Stock.

                  (ii) Unvested Options.  At the Effective Time,  Acquirer shall
assume each HOVRS Stock Option that is outstanding  and not vested in accordance
with its terms immediately  prior to the Closing (the "HOVRS Unvested  Options")
together  with the option  agreement  representing  each such HOVRS Stock Option
(each, an "Assumed HOVRS Option"). Each Assumed HOVRS Option shall thereafter be
exercisable  for such  number of shares of Acquirer  Common  Stock as equals the
number of shares of HOVRS Common  Stock  subject to such HOVRS  Unvested  Option
multiplied  by the Option  Exchange  Ratio  (rounded  down to the nearest  whole
number). The exercise price per share of each such Assumed HOVRS Option shall be
equal to the exercise price per share set forth in the option agreement for such
Assumed HOVRS Option  divided by the Option  Exchange  Ratio  (rounded up to the
next whole cent).  The  determination of the number of shares of Acquirer Common
Stock subject to each Assumed HOVRS  Option,  as well as the exercise  price for
such option shall each be determined in compliance with the "ratio test" and the
"spread test" of the Treasury  Regulations under Section 424 of the Code. Except
as set forth  above,  the  terms of the  HOVRS  Unvested  Options  shall  remain
unchanged.

            (e) Capital Stock of HOVRS Merger Sub. At the Effective  Time,  each
share of common  stock of HOVRS  Merger Sub issued and  outstanding  immediately
prior to the  Effective  Time shall be converted  into and exchanged for one (1)
validly  issued,  fully  paid and  nonassessable  share of  common  stock of the
Surviving  Corporation.  Each stock  certificate  of HOVRS Merger Sub evidencing
ownership of any such shares shall continue to evidence ownership of such shares
of capital stock of the Surviving Corporation.

            (f)  Adjustments.  The  number of shares of  Acquirer  Common  Stock
issuable  in the Merger  shall be  adjusted  to reflect  fully the effect of any
stock  split,   reverse  split,  stock  dividend   (including  any  dividend  or
distribution of securities  convertible into Acquirer Common Stock, HOVRS Common
Stock or HOVRS Preferred Stock), reorganization,  recapitalization or other like
change with  respect to Acquirer  Common  Stock and HOVRS  Securities  occurring
after the date hereof and prior to the Effective Time.

            (g)  Fractional  Shares.  No fraction of a share of Acquirer  Common
Stock  shall be issued,  but in lieu  thereof any HOVRS  Stockholder  that would
otherwise  be entitled to a fraction of a share of Acquirer  Common Stock (after
aggregating  all  fractional  shares of Acquirer  Common Stock to be received by
such holder) shall receive from Acquirer an amount of cash

                                       15
<PAGE>

(rounded to the nearest  whole cent) equal to the product of (i) such  fraction,
multiplied  by  (ii)  the  Closing  Price  as of  the  Determination  Date.  The
fractional  share interests of each HOVRS  Stockholder  shall be aggregated,  so
that no HOVRS  Stockholder  shall  receive cash in respect of  fractional  share
interests  in an amount  greater  than the value of one full  share of  Acquirer
Common Stock.  Payment to HOVRS  Stockholders of such cash in lieu of fractional
shares of Acquirer  Common Stock otherwise  issuable  hereunder shall be made to
the HOVRS  Stockholders  by  Acquirer  at such time as  Acquirer  is required to
deliver Common Merger  Consideration or Preferred Merger  Consideration,  as the
case may, to such holder,  provided that the HOVRS  Stockholder has delivered to
Acquirer  such  holder's  Certificates  in  accordance  with  Section  2.8(b) or
complied with the provisions of Section 2.9.

            (h)  Dissenters'  Rights.  Notwithstanding  any  provision  of  this
Agreement to the contrary,  Dissenting  Shares,  if any,  shall not be converted
into or  exchangeable  for a right to receive  Common  Merger  Consideration  or
Preferred Merger  Consideration but shall instead be converted into the right to
receive such  consideration  as may be determined to be due with respect to such
Dissenting  Shares  pursuant to Delaware Law (and at the  Effective  Time,  such
Dissenting  Shares shall no longer be  outstanding  and shall  automatically  be
canceled  and shall  cease to exist,  and such  holder  shall  cease to have any
rights with respect thereto,  except the right to receive the fair value of such
Dissenting  Shares in accordance  with the provisions of Section 262 of Delaware
Law),  unless and until such  holder  shall have failed to perfect or shall have
effectively  withdrawn or lost rights to appraisal  under  Delaware  Law.  HOVRS
shall give  Acquirer  prompt  notice of any demand  received by HOVRS to require
HOVRS to purchase  shares of HOVRS Common Stock or HOVRS  Preferred  Stock,  and
Acquirer shall have the right to participate in all negotiations and proceedings
with respect to such demand.  HOVRS agrees that,  except with the prior  written
consent  of  Acquirer,  or as  required  under  the  Delaware  Law,  it will not
voluntarily make any payment with respect to, or settle or offer to settle,  any
such   purchase   demand.   Each  holder  of  Dissenting   Shares   ("Dissenting
Stockholder")  who, pursuant to the provisions of Delaware Law, becomes entitled
to payment of the fair value for shares of HOVRS Common Stock or HOVRS Preferred
Stock shall receive  payment  therefor (but only after the value  therefor shall
have been agreed upon or finally  determined  pursuant to such provisions).  If,
after the  Effective  Time,  any  Dissenting  Shares  shall lose their status as
Dissenting  Shares,  Acquirer  shall issue and deliver,  upon  surrender by such
stockholder of a Certificate or Certificates representing shares of HOVRS Common
Stock or HOVRS Preferred Stock (or compliance with Section 2.9), as the case may
be, Common Merger Consideration or Preferred Merger Consideration, as applicable
and to which such  stockholder  would  otherwise  have been  entitled  as of the
Effective  Time under this  Section 2.6,  without  interest  thereon,  less such
stockholder's  pro rata portion of the Escrow Cash and the Holdback Cash,  which
shall be withheld  and  deposited  respectively  in the Escrow Fund  pursuant to
Section 9.1 hereof and the Holdback Fund pursuant to Section 9.8(d).

      2.7. Cash / Stock Election and Election Procedure.

            (a)  Definitions.  As used in this Section 2.7, the following  terms
shall have the meanings set forth below:

                  "Common  Cash  Election  Shares"  means shares of HOVRS Common
      Stock as to which a Common Cash Election has been made.

                                       16
<PAGE>

                  "Common  Stock  Election  Shares" means shares of HOVRS Common
      Stock as to which a Common Stock Election has been made.

                  "Common  Non-Election  Shares"  means  shares of HOVRS  Common
      Stock as to which no  election  has been made (or as to which an  Election
      Form has not been properly completed and returned in a timely fashion).

                  "Preferred  Cash  Election   Shares"  means  shares  of  HOVRS
      Preferred Stock as to which a Preferred Cash Election has been made.

                  "Preferred  Stock  Election  Shares"  means  shares  of  HOVRS
      Preferred Stock as to which a Preferred Stock Election has been made.

                  "Preferred   Non-Election   Shares"   means  shares  of  HOVRS
      Preferred  Stock as to which no election  has been made (or as to which an
      Election  Form has not been  properly  completed  and returned in a timely
      fashion).

            (b)  Election and Election  Form.  The Exchange  Agent shall mail an
election form and other appropriate and customary  transmittal  materials (which
shall  specify that  delivery  shall be effected,  and risk of loss and title to
Certificates  shall pass, only upon proper delivery of such  Certificates to the
Exchange  Agent in such form as to which HOVRS and Acquirer shall mutually agree
(the "Election Form"),  together with a copy of the HOVRS Information Statement,
to each holder of record of HOVRS Common Stock,  HOVRS Preferred Stock and HOVRS
Stock  Options.  The Cash Election and Stock Election to be made in the Election
Form shall be stated as a percentage (in whole  numbers) of the aggregate  value
of the Merger  Consideration  allocable to such HOVRS  Stockholder in respect of
such  holder's  ownership  of issued or  issuable  HOVRS  Common  Stock or HOVRS
Preferred Stock, and the sum of the Cash Election  percentage and Stock Election
percentage for each HOVRS  Stockholder  shall equal one hundred  percent (100%).
Each Election Form shall permit:

                  (i) the holder of record of HOVRS Preferred Stock (A) to elect
to receive  Preferred Cash  Consideration  for all or a portion of such holder's
shares of HOVRS Preferred Stock (a "Preferred Cash  Election");  (B) to elect to
receive  Preferred  Stock  Consideration  for all or a portion of such  holder's
shares of HOVRS Preferred Stock (a "Preferred Stock  Election");  or (C) to make
no election (by failing to return an Election Form or otherwise) with respect to
the receipt of Preferred Cash Consideration or Preferred Stock  Consideration (a
"Preferred Non-Election"); and

                  (ii) the holder of record of HOVRS  Common  Stock (A) to elect
to receive  Common  Cash  Consideration  for all or a portion  of such  holder's
shares of HOVRS Common Stock (each a "Common Cash  Election"  and together  with
the Preferred Cash Election,  collectively the "Cash Election"); (B) to elect to
receive Common Stock  Consideration for all or a portion of such holder's shares
of HOVRS  Common Stock (each a "Common  Stock  Election"  and together  with the
Preferred Stock Elections, collectively the "Stock Election"); or (C) to make no
election (by failing to return an Election  Form or  otherwise)  with respect to
the receipt of the Common Cash  Consideration or the Common Stock  Consideration
(a "Common Non-Election").

                                       17
<PAGE>

Notwithstanding the foregoing or any other provision hereof to the contrary:

                  (w) each HOVRS Stockholder that makes a Preferred Non-Election
(by failing to return an Election Form or  otherwise)  with respect to any HOVRS
Preferred  Stock  held  thereby  shall be deemed to have made a  Preferred  Cash
Election with respect to a percentage of such shares equal to the Cash Threshold
Percentage  and to have made a  Preferred  Stock  Election  with  respect to the
balance of such shares;

                  (x) each HOVRS  Stockholder  that makes a Common  Non-Election
(by failing to return an Election Form or  otherwise)  with respect to any HOVRS
Preferred Stock held thereby shall be deemed to have made a Common Cash Election
with  respect  to a  percentage  of such  shares  equal  to the  Cash  Threshold
Percentage  and to have made a Common Stock Election with respect to the balance
of such shares; and

                  (y) each HOVRS Stockholder shall be required to make a Minimum
Cash Election for purposes of  allocating  such holder's pro rata portion of the
Escrow Cash to the Escrow Fund in satisfaction of the obligations  under Section
2.8(g) hereof and the Holdback Cash to the Holdback Fund and in  satisfaction of
the obligations  under Section 9.8(d) hereof.  If a HOVRS  Stockholder  fails to
make the Minimum  Cash  Election,  the  Exchange  Agent shall  reapportion  such
holder's cash / stock allocation to satisfy such requirement.

            (c) Delivery of Election Form. To be effective, a properly completed
Election  Form shall be submitted to the Exchange  Agent on or before 5:00 p.m.,
San  Francisco,  local  time,  on a  date  specified  in the  HOVRS  Information
Statement and letter of  transmittal  which date shall be no later than five (5)
Business Days prior to the scheduled  Closing Date to be mutually agreed upon by
the  parties,  which date shall be  publicly  announced  by  Acquirer as soon as
practicable  prior to such date (the  "Election  Deadline"),  accompanied  by an
executed   counterpart  of  the  Lock-up  and  Registration   Rights  Agreement,
substantially  in the form attached here to as Exhibit  2.7(c)(i)  (the "Lock-up
Agreement"),  and an executed Investment Representation Letter, substantially in
the form of Exhibit 2.7(c)(ii) (the "Investment  Representation  Letter"),  from
HOVRS Stockholders that make a Stock Election,  and the Certificates as to which
such Election Form is being made or by an  appropriate  guarantee of delivery of
such  Certificates,  as set  forth in the  Election  Form,  from a member of any
registered national securities exchange or a commercial bank or trust company in
the United States (provided that such  Certificates are in fact delivered to the
Exchange  Agent by the time required in such  guarantee of delivery;  failure to
deliver shares of HOVRS Common Stock or HOVRS  Preferred  Stock, as the case may
be,  covered by such  guarantee  of  delivery  within the time set forth on such
guarantee  shall be deemed to invalidate  any otherwise  properly made election,
unless otherwise determined by Acquirer, in its sole discretion). If a holder of
HOVRS Securities either (i) does not submit a properly  completed  Election Form
in a timely  fashion or (ii)  revokes the  holder's  Election  Form prior to the
Election Deadline (without later submitting a properly  completed  Election Form
prior to the  Election  Deadline),  the  shares of HOVRS  Common  Stock or HOVRS
Preferred Stock held by such holder shall be designated Common

                                       18
<PAGE>

Non-Election Shares or Preferred  Non-Election  Shares. All Election Forms shall
automatically be revoked, and all Certificates  returned,  if the Exchange Agent
is  notified  in writing by  Acquirer  and HOVRS  that this  Agreement  has been
terminated. Subject to the terms of this Agreement and of the Election Form, the
Exchange  Agent  shall have  reasonable  discretion  to  determine  whether  any
election has been properly or timely made and to disregard immaterial defects in
any Election Form, and any good faith  decisions of the Exchange Agent regarding
such matters shall be binding and conclusive.  Neither Acquirer nor the Exchange
Agent  shall be under any  obligation  to notify  any Person of any defect in an
Election Form.

            (d)  Determination  of  Cash  and  Stock   Allocation.   Immediately
following the close of business on the  Determination  Date,  upon  consultation
with HOVRS and Acquirer,  the Exchange  Agent shall  determine the allocation of
the Merger  Consideration to the HOVRS Common Stock and HOVRS Preferred Stock in
accordance  with Section 2.7(e) below,  and the Exchange  Agent's  determination
shall be final and binding (the "Final Allocation").

            (e) Cash/Stock  Allocation of the Merger  Consideration.  The Merger
Consideration  shall be  allocated  among the holders of shares of HOVRS  Common
Stock and HOVRS Preferred Stock as follows in this Section 2.7(e); provided that
for  purposes  of the  cash/stock  allocation  calculations  only,  and  without
actually  converting  into a right to receive Merger  Consideration  and without
contravening in any manner the provisions of Section 2.6(h),  Dissenting  Shares
(if any) shall be treated as Common Non-Election Share or Preferred Non-Election
Shares,  as the  case  may  be;  provided  further,  that  for  purposes  of the
cash/stock allocation calculations set forth below, references to Cash Election,
Cash Election Shares,  Cash Consideration and the like shall be inclusive of the
Escrow Cash and the  Holdback  Cash,  and the setting  aside of such amounts for
purposes  of the Escrow  Fund and the  Holdback  Fund shall be  disregarded  for
purposes of this Section 2.7(e).

                  (i) Elections  Satisfied Without Proration.  If the percentage
of the  HOVRS  Stockholders  that  make  Stock  Elections  is equal to the Stock
Threshold Percentage and the percentage of the HOVRS Stockholders that make Cash
Elections is equal to the Cash Threshold Percentage,  then at the Effective Time
each share of HOVRS Common Stock and each share of HOVRS  Preferred  Stock shall
convert into a right to receive Merger Consideration, as follows:

                        (A) all Common Cash  Election  Shares shall be converted
            into the right to receive Common Cash Consideration;

                        (B) subject to Section 2.6(g)  hereof,  all Common Stock
            Election  Shares shall be converted into the right to receive Common
            Stock Consideration;

                        (C)  all  Preferred   Cash  Election   Shares  shall  be
            converted into the right to receive Preferred Cash Consideration;

                        (D)  subject to Section  2.6(g)  hereof,  all  Preferred
            Stock  Election  Shares shall be converted into the right to receive
            Preferred Stock Consideration;

                        (F) a percentage of the Common  Non-Election Shares held
            by each HOVRS  Stockholder  equal to the Cash  Threshold  Percentage
            shall  be   converted into

                                       19
<PAGE>

            the right to receive Common Cash  Consideration,  and the balance of
            each such holder's Common  Non-Election  Shares,  subject to Section
            2.6(g),  shall be converted  into the right to receive  Common Stock
            Consideration; and

                        (G) a percentage  of the Preferred  Non-Election  Shares
            held  by  each  HOVRS   Stockholder  equal  to  the  Cash  Threshold
            Percentage  shall be converted  into the right to receive  Preferred
            Cash Consideration,  and the balance of each such holder's Preferred
            Non-Election  Shares,  subject to Section 2.6(g), shall be converted
            into the right to receive Preferred Stock Consideration.

                  (ii) Elections Satisfied With Proration.

                        (A) Excess Cash Elections.  If HOVRS  Stockholders  make
            Cash Elections whereby they elect to receive Cash Consideration that
            in the  aggregate  exceeds  the  amount  of  cash  available  in the
            Exchange  Fund,  assuming  the  inclusion  of the Escrow Cash in the
            Exchange  Fund  and the  Holdback  Cash  in the  Holdback  Fund  for
            calculation  purposes  only (such  that there is a shortage  of Cash
            Consideration available to satisfy the Cash Elections),  then at the
            Effective Time each share of HOVRS Common Stock and HOVRS  Preferred
            Stock shall convert into a right to receive Merger Consideration, as
            follows:

                                (1) subject to Section 2.6(g),  all Common Stock
                                Election  Shares  shall  be  converted  into the
                                right to receive Common Stock Consideration, and
                                all  Preferred  Stock  Election  Shares shall be
                                converted  into the right to  receive  Preferred
                                Stock Consideration;

                                (2) all Common  Cash  Election  Shares held by a
                                HOVRS  Stockholder  that  elects  to  receive  a
                                percentage  of  its  allocable  portion  of  the
                                Merger  Consideration  in cash  equal to or less
                                than  the  Cash  Threshold  Percentage  shall be
                                converted  into the right to receive Common Cash
                                Consideration;

                                (3) all Preferred Cash Election Shares held by a
                                HOVRS  Stockholder  that  elects  to  receive  a
                                percentage  of  its  allocable  portion  of  the
                                Merger  Consideration  in cash  equal to or less
                                than  the  Cash  Threshold  Percentage  shall be
                                converted  into the right to  receive  Preferred
                                Cash Consideration;

                                (4) a  percentage  of  the  Common  Non-Election
                                Shares held by a HOVRS  Stockholder equal to the
                                Cash  Threshold  Percentage  shall be  converted
                                into  the   right   to   receive   Common   Cash
                                Consideration,  and the  balance  of  each  such
                                holder's Common Non-Election Shares,  subject to

                                       20
<PAGE>

                                Section  2.6(g),  shall  be  converted  into the
                                right to receive Common Stock Consideration;

                                (5) a percentage of the  Preferred  Non-Election
                                Shares held by a HOVRS  Stockholder equal to the
                                Cash  Threshold  Percentage  shall be  converted
                                into  the  right  to  receive   Preferred   Cash
                                Consideration,  and the  balance  of  each  such
                                holder's Preferred  Non-Election Shares, subject
                                to Section  2.6(g),  shall be converted into the
                                right to receive Preferred Stock  Consideration;
                                and

      after giving  effect to the  allocations  in clauses  (1)-(5)  immediately
      above,  the  unallocated  cash in the Exchange  Fund (for purposes of this
      Section  2.7(e)(ii)(A),  the "Unallocated  Cash") and the aggregate market
      value of the  unallocated  Acquirer  Common  Stock in the  Exchange  Fund,
      determined by reference to the Closing Price as of the Determination  Date
      (for  purposes of this Section  2.7(e)(ii)(A),  the  "Unallocated  Stock")
      shall be allocated, whereby

                                (6) Common Cash  Election  Shares and  Preferred
                                Cash Election Shares held by a HOVRS Stockholder
                                that  elects  to  receive  a  percentage  of its
                                allocable portion of the Merger Consideration in
                                cash greater than the Cash Threshold  Percentage
                                shall be  converted  into the  right to  receive
                                Merger Consideration as follows:

            (x)  each  such  HOVRS   Stockholder   will   receive   Common  Cash
      Consideration  in respect of a number of the Common Cash  Election  Shares
      held thereby equal to the product  obtained by multiplying  (a) the number
      of Common Cash  Election  Shares held by such HOVRS  Stockholder  by (b) a
      fraction,  the numerator of which is equal to the Unallocated Cash and the
      denominator of which is equal to the sum of the Unallocated  Cash plus the
      Unallocated Stock, and the balance of the Common Cash Election Shares held
      by such HOVRS  Stockholder  shall be  converted  into the right to receive
      Common Stock Consideration; and

            (y)  each  such  HOVRS   Stockholder  will  receive  Preferred  Cash
      Consideration in respect of a number of the Preferred Cash Election Shares
      held thereby equal to the product  obtained by multiplying  (a) the number
      of Preferred Cash Election Shares held by such HOVRS  Stockholder by (b) a
      fraction,  the numerator of which is equal to the Unallocated Cash and the
      denominator of which is equal to the sum of the Unallocated  Cash plus the
      Unallocated  Stock,  and the balance of the Preferred Cash Election Shares
      held by such  HOVRS  Stockholder  shall be  converted  into  the  right to
      receive Preferred Stock Consideration.

                                       21
<PAGE>

                        (B) Excess Stock Elections.  If HOVRS  Stockholders make
            Stock  Elections  whereby they elect to receive Stock  Consideration
            having an aggregate  value that exceeds the  aggregate  value of the
            shares of Acquirer  Common Stock in the Exchange  Fund, in each case
            based upon the Closing Price as of the Determination Date (such that
            there is a shortage of Stock Consideration  available to satisfy the
            elections by such  stockholders),  then at the  Effective  Time each
            share of HOVRS Common Stock and HOVRS  Preferred Stock shall convert
            into a right to receive Merger Consideration, as follows:

                              (1) all  Common  Cash  Election  Shares  shall  be
                              converted  into the right to receive  Common  Cash
                              Consideration,  and all  Preferred  Cash  Election
                              Shares  shall  be  converted  into  the  right  to
                              receive Preferred Cash Consideration;

                              (2) subject to Section  2.6(g),  all Common  Stock
                              Election Shares held by a HOVRS  Stockholder  that
                              elects to receive a  percentage  of its  allocable
                              portion of the Merger  Consideration  in  Acquirer
                              Common  Stock  equal  to or less  than  the  Stock
                              Threshold  Percentage  shall be converted into the
                              right to receive Common Stock Consideration;

                              (3) subject to Section 2.6(g), all Preferred Stock
                              Election Shares held by a HOVRS  Stockholder  that
                              elects to receive a  percentage  of its  allocable
                              portion of the Merger  Consideration  in  Acquirer
                              Common  Stock  equal  to or less  than  the  Stock
                              Threshold  Percentage  shall be converted into the
                              right to receive Preferred Stock Consideration;

                              (4) subject to Section 2.6(g), a percentage of the
                              Common   Non-Election   Shares  held  by  a  HOVRS
                              Stockholder   equal   to   the   Stock   Threshold
                              Percentage  shall  be  converted  into a right  to
                              receive  Common  Stock   Consideration,   and  the
                              balance of each such holder's Common  Non-Election
                              Shares  shall  be  converted  into  the  right  to
                              receive Common Cash Consideration;

                              (5) subject to Section 2.6(g), a percentage of the
                              Preferred  Non-Election  Shares  held  by a  HOVRS
                              Stockholder   equal   to   the   Stock   Threshold
                              Percentage  shall  be  converted  into a right  to
                              receive  Preferred  Stock  Consideration,  and the
                              balance   of   each   such   holder's    Preferred
                              Non-Election  Shares shall be  converted  into the
                              right to receive Preferred Cash Consideration; and

                                       22
<PAGE>

                              after giving effect to the  allocations in clauses
                              (1)-(5) immediately above, the unallocated cash in
                              the  Exchange  Fund (for  purposes of this Section
                              2.7(e)(ii)(B),  the  "Unallocated  Cash")  and the
                              aggregate market value of the unallocated Acquirer
                              Common Stock in the Exchange  Fund,  determined by
                              reference   to  the   Closing   Price  as  of  the
                              Determination  Date (for  purposes of this Section
                              2.7(e)(ii)(B),  the "Unallocated  Stock") shall be
                              allocated, whereby

                              (6)  subject  to  Section  2.6(g),   Common  Stock
                              Election   Shares  and  Preferred  Stock  Election
                              Shares held by a HOVRS  Stockholder that elects to
                              receive a percentage of its  allocable  portion of
                              the Merger  Consideration in Acquirer Common Stock
                              greater than the Stock Threshold  Percentage shall
                              be  converted  into the  right to  receive  Merger
                              Consideration as follows:

            (x) each such  HOVRS  Stockholder  will  receive  the  Common  Stock
      Consideration  in respect of a number of the Common Stock Election  Shares
      held thereby equal to the product  obtained by multiplying  (a) the number
      of Common Stock  Election  Shares held by such HOVRS  Stockholder by (b) a
      fraction, the numerator of which is equal to the Unallocated Stock and the
      denominator of which is equal to the sum of the Unallocated  Cash plus the
      Unallocated  Stock,  and the balance of the Common Stock  Election  Shares
      held by such  HOVRS  Stockholder  shall be  converted  into  the  right to
      receive Common Cash Consideration; and

            (y) each such HOVRS  Stockholder  will receive the  Preferred  Stock
      Consideration in respect of a number of the Preferred Cash Election Shares
      held thereby equal to the product  obtained by multiplying  (a) the number
      of Preferred Stock Election Shares held by such HOVRS Stockholder by (b) a
      fraction, the numerator of which is equal to the Unallocated Stock and the
      denominator of which is equal to the sum of the Unallocated  Cash plus the
      Unallocated  Stock, and the balance of the Preferred Stock Election Shares
      held by such  HOVRS  Stockholder  shall be  converted  into  the  right to
      receive Preferred Cash Consideration.

      2.8. Exchange Procedures.

            (a) On or before the Closing Date, for the benefit of the holders of
Certificates,  (i) Acquirer  shall cause to be delivered to the Exchange  Agent,
for   exchange  in   accordance   with  this  Section  2,   certificates   ("New
Certificates")  representing  6,700,000  shares  of  Acquirer  Common  Stock (as
adjusted for any stock splits, share dividends, combinations,  reclassifications
or the like that occur  after the date of this  Agreement  with  respect to such
shares) issuable  pursuant to this Section 2, and (ii) Acquirer shall deliver or
cause to be delivered

                                       23
<PAGE>

to the  Exchange  Agent the Merger Cash minus the Escrow  Cash and the  Holdback
Cash (the  combination  of (i) and (ii) above,  hereinafter  referred to as, the
"Exchange Fund").

            (b)  At  the  Closing,  or  as  soon  thereafter  as  is  reasonably
practicable,  each HOVRS  Stockholder  shall deliver or cause to be delivered to
the Exchange Agent the  Certificate(s)  representing  the shares of HOVRS Common
Stock and HOVRS Preferred Stock  beneficially  owned by such HOVRS  Stockholder.
Upon proper  surrender of a  Certificate  for exchange and  cancellation  to the
Exchange Agent, the holder of such  Certificate  shall be entitled to receive in
exchange  therefor,  as applicable,  (i) subject to delivery by the surrendering
HOVRS  Stockholder  to the  Exchange  Agent of an  executed  copy of the Lock-up
Agreement and a completed and executed Investment  Representation  Letter, a New
Certificate  representing  shares of Acquirer Common Stock (if any) equal to the
Stock  Consideration  to which such former holder of HOVRS Common Stock or HOVRS
Preferred  Stock shall have become entitled  pursuant to this Agreement,  (ii) a
check or wire transfer of immediately  available funds in an amount equal to the
Cash  Consideration  to which such former  holder of HOVRS Common Stock or HOVRS
Preferred Stock shall have become entitled  pursuant to this Agreement (of which
the amount of such holder's  Minimum Cash  Election  shall be or shall have been
deposited  in the  Escrow  Fund and the  Holdback  Fund),  and/or  (iii) a check
representing  the amount of cash (if any) payable in lieu of a fractional  share
of Acquirer  Common  Stock which such former  holder has the right to receive in
respect of the  Certificate  surrendered  pursuant  to this  Agreement,  and the
Certificate so surrendered  shall forthwith be cancelled.  Until  surrendered as
contemplated by this Section 2.8(b),  each Certificate  (other than Certificates
representing  treasury  stock)  shall be deemed at any time after the  Effective
Time to  represent  only the right to  receive  upon such  surrender  the Merger
Consideration provided in Section 2.6 and any unpaid dividends and distributions
thereon as provided in paragraph  (c) of this Section 2.8. No interest  shall be
paid or accrued on any cash  constituting  Merger  Consideration  (including any
cash in lieu of fractional  shares) and any unpaid  dividends and  distributions
payable to holders of Certificates.

            (c) No dividends or other distributions with a record date after the
Effective Time with respect to Acquirer Common Stock shall be paid to the holder
of any  unsurrendered  Certificate until the holder thereof shall surrender such
Certificate  in  accordance  with this  Section  2.8.  After the  surrender of a
Certificate in accordance with this Section 2.8, the record holder thereof shall
be entitled to receive any such  dividends or other  distributions,  without any
interest thereon, which theretofore had become payable with respect to shares of
Acquirer Common Stock represented by such Certificate.

            (d) The Exchange  Agent and Acquirer,  as the case may be, shall not
be  obligated  to deliver  cash  and/or a New  Certificate  or New  Certificates
representing  shares of Acquirer  Common Stock to which a holder of HOVRS Common
Stock or HOVRS  Preferred  Stock would  otherwise be entitled as a result of the
Merger until such holder surrenders the Certificate or Certificates representing
the  shares of HOVRS  Common  Stock or HOVRS  Preferred  Stock for  exchange  as
provided in this Section 2.8, or, an appropriate affidavit of loss and indemnity
agreement,  together  with an  executed  copy of the  Lock-up  Agreement  and an
executed Investment  Representation  Letter. If any New Certificates  evidencing
shares of  Acquirer  Common  Stock are to be issued in a name other than that in
which the  Certificate  evidencing  HOVRS Common Stock or HOVRS  Preferred Stock
surrendered in exchange  therefor is registered,  it shall be a condition of the
issuance thereof that the Certificate so

                                       24
<PAGE>

surrendered  shall be properly  endorsed or  accompanied  by an executed form of
assignment  separate  from the  Certificate  and  otherwise  in proper  form for
transfer, and that the Person requesting such exchange pay to the Exchange Agent
any  transfer  or  other  tax  required  by  reason  of  the  issuance  of a New
Certificate  for shares of Acquirer  Common Stock in any name other than that of
the registered holder of the Certificate  surrendered or otherwise  establish to
the  satisfaction  of the  Exchange  Agent that such tax has been paid or is not
payable.

            (e) Any portion of the Exchange  Fund that remains  unclaimed by the
former HOVRS  Stockholders  for six (6) months after the Effective Time (as well
as any interest or proceeds from any  investment  thereof) shall be delivered by
the  Exchange  Agent to  Acquirer.  Any  former  HOVRS  Stockholder  who has not
theretofore  complied with Section 2.8(b) shall thereafter look only to Acquirer
for the  Merger  Consideration  deliverable  in  respect  of each share of HOVRS
Common  Stock or HOVRS  Preferred  Stock such  stockholder  holds as  determined
pursuant to this  Agreement,  in each case  without  any  interest  thereon.  If
outstanding  Certificates  for shares of HOVRS Common  Stock or HOVRS  Preferred
Stock are not  surrendered  or the payment for them is not claimed  prior to the
date on which such  shares of  Acquirer  Common  Stock or cash  would  otherwise
escheat to or become the  property of any  Governmental  Entity,  the  unclaimed
items  shall,  to the  extent  permitted  by  abandoned  property  and any other
Applicable  Law,  become the property of Acquirer  (and to the extent not in its
possession  shall be delivered to it),  free and clear of all claims or interest
of any Person previously  entitled to such property.  Neither the Exchange Agent
nor any party to this Agreement shall be liable to any holder of shares of HOVRS
Common Stock or HOVRS  Preferred  Stock  represented by any  Certificate for any
consideration  paid  to a  public  official  pursuant  to  applicable  abandoned
property,  escheat or similar  laws.  Acquirer and the  Exchange  Agent shall be
entitled  to rely  upon the  stock  transfer  books of  HOVRS to  establish  the
identity of those Persons entitled to receive the Merger Consideration specified
in this Agreement,  which books shall be conclusive with respect thereto. In the
event of a dispute with respect to ownership of any shares of HOVRS Common Stock
or HOVRS  Preferred  Stock  represented  by any  Certificate,  Acquirer  and the
Exchange Agent shall be entitled to deposit any Merger Consideration represented
thereby in escrow with an  independent  third party and  thereafter  be relieved
with respect to any claims thereto.

            (f) Acquirer  (through the Exchange Agent,  if applicable)  shall be
entitled to deduct and withhold from any amounts  otherwise  payable pursuant to
this Agreement to any holder of shares of HOVRS Common Stock or HOVRS  Preferred
Stock  such  amounts as  Acquirer  is  required  to deduct  and  withhold  under
Applicable  Law. Any amounts so deducted  and withheld  shall be treated for all
purposes of this  Agreement  as having  been paid to the holder of HOVRS  Common
Stock  or  HOVRS  Preferred  Stock  in  respect  of  which  such  deduction  and
withholding was made by Acquirer.

            (g) As of the  Closing,  and subject to and in  accordance  with the
provisions  of  Section  9.1  hereof,  Acquirer  shall  deliver,  or cause to be
delivered,  the Escrow  Cash to the Escrow  Agent and the  Holdback  Cash to the
Stockholders'   Agent.  The  property   comprising  the  Escrow  Fund  shall  be
beneficially  owned by the HOVRS  Stockholders  and shall be held in escrow  and
shall be available to compensate  Acquirer for certain Damages during the Escrow
Period as provided in Section 9. The property comprising the Holdback Fund shall
be beneficially  owned by the HOVRS Stockholders and shall be held in escrow and
shall be

                                       25
<PAGE>

available to the Stockholders'  Agent for any reasonable and documented expenses
incurred in the course of defending any  indemnification  claim made against the
Escrow Fund during the Escrow  Period as provided in Section  9.2(b) or pursuing
any indemnification  claim as provided in Section 9.2(c). To the extent not used
for such purposes,  the property comprising the Escrow Fund shall be released to
the HOVRS Stockholders based upon their respective allocable portion as provided
in Section 9.3, the Final Allocation and pursuant to the terms and conditions of
the Escrow Agreement.

      2.9. Lost, Stolen or Destroyed HOVRS  Certificates.  In the event that any
Certificate  representing HOVRS Common Stock or HOVRS Preferred Stock shall have
been lost, stolen or destroyed and such securities  represent a right to receive
Acquirer Common Stock, as determined pursuant to the Final Allocation,  Acquirer
shall,  upon  delivery  of an  affidavit  of  that  fact by the  holder  of such
Certificate, issue irrevocable instructions to the Exchange Agent to issue share
certificates  representing  the shares of Acquirer  Common Stock to be issued to
the owner of, and in exchange for, such lost,  stolen or destroyed  HOVRS Common
Stock or HOVRS Preferred  Stock,  provided,  however,  that Acquirer may, in its
reasonable  discretion  and as a condition  precedent to the  issuance  thereof,
require the owner of such lost,  stolen or destroyed HOVRS Common Stock or HOVRS
Preferred  Stock to provide  Acquirer  with an indemnity  agreement  against any
claim  that may be made  against  Acquirer,  the  Surviving  Corporation  or the
Exchange Agent with respect to the HOVRS Common Stock or HOVRS  Preferred  Stock
alleged to have been lost, stolen or destroyed.

      2.10. Tax Consequences.  The parties hereto agree to treat the exchange of
the HOVRS Common Stock and HOVRS  Preferred  Stock for Acquirer  Common Stock in
the  Merger  and the  corresponding  issuance  of  Acquirer  Preferred  Stock to
Clearlake in order to raise capital as integrated steps in a single  transaction
by Acquirer  to acquire  HOVRS and raise  capital  and,  therefore,  the parties
hereto intend that the exchange of HOVRS Common Stock and HOVRS  Preferred Stock
for Acquirer  Common Stock in the Merger will qualify as a tax-free  exchange of
property for stock under Section 351 of the Code (and any comparable  provisions
of  applicable  state or local tax laws).  Acquirer  agrees (and shall cause the
Surviving  Corporation  after  the  Effective  Time) to  report  and  treat  the
transactions  described  in this  Agreement in a manner  consistently  therewith
except as otherwise may be required by a taxing authority.

      2.11.  Taking of Necessary  Action;  Further Action.  Each of Acquirer and
HOVRS will take all such  reasonable  and lawful  action as may be  necessary or
desirable in order to effectuate the Merger in accordance with this Agreement as
promptly as  possible.  If, at any time after the  Effective  Time,  any further
action is necessary or desirable to carry out the purposes of this Agreement, to
vest the  Surviving  Corporation  with full right,  title and  possession to all
assets, property, rights,  privileges,  powers and franchises of HOVRS and HOVRS
Merger Sub, the  officers and  directors of HOVRS and HOVRS Merger Sub are fully
authorized in the name of their  respective  corporations  or otherwise to take,
and will take, all such lawful and necessary  action,  so long as such action is
not inconsistent with this Agreement.

3.  Representations  and Warranties of HOVRS.  HOVRS  represents and warrants to
Acquirer that the  statements  contained in this Section 3 are true and correct,
except as disclosed in a document of even date  herewith and  delivered by HOVRS
to Acquirer on the date hereof referring to the  representations  and warranties
in this Agreement (the "HOVRS Disclosure

                                       26
<PAGE>

Schedule")  (it being  understood  and agreed that the disclosure set forth in a
specific  section or subsection of the HOVRS  Disclosure  Schedule shall qualify
the  representations  and warranties set forth in the corresponding  section and
subsection  of this  Section 3  (whether  or not a specific  cross-reference  is
included  therein)  if and to the extent that it is  reasonably  apparent on the
face of such disclosure  that such  disclosure  applies to such other section or
subsection).

      3.1.  Organization,  Standing  and  Power.  HOVRS  is a  corporation  duly
organized,  validly existing and in good standing under the laws of the state of
Delaware.  HOVRS has the corporate  power to own its  properties and to carry on
its business as now being  conducted and is duly qualified to do business and is
in good  standing in each  jurisdiction  in which the failure to be so qualified
and in good standing  could  reasonably  be expected to have a Material  Adverse
Effect on HOVRS.  HOVRS has  delivered  a true and  correct  copy of its Charter
Documents,  each as amended to date,  to Acquirer.  HOVRS is not in violation of
any of the provisions of its Charter  Documents.  Except as set forth on Section
3.1 of the HOVRS Disclosure Schedule,  HOVRS does not own directly or indirectly
any equity or similar  interest in, or any interest  convertible or exchangeable
or  exercisable  for,  any  equity or  similar  interest  in,  any  corporation,
partnership, joint venture or other business association or entity.

      3.2.  Authority.  HOVRS has all requisite corporate power and authority to
enter  into this  Agreement  and to  consummate  the  transactions  contemplated
hereby. The execution and delivery of this Agreement and the consummation of the
transactions  contemplated  hereby have been duly  authorized  by all  necessary
corporate action on the part of HOVRS subject only to the approval of the Merger
by the HOVRS  Stockholders as contemplated by Section 6.3. The affirmative  vote
of the holders of a majority of the shares of the HOVRS  Common  Stock and HOVRS
Preferred  Stock voting  together as a class,  and the  affirmative  vote of the
holders  of a  majority  of the  shares  of the  HOVRS  Preferred  Stock  voting
separately as a class, are the only votes of the holders of HOVRS' capital stock
necessary  under  Delaware Law to approve this  Agreement  and the  transactions
contemplated  hereby.  This  Agreement  has been duly  executed and delivered by
HOVRS and  constitutes  the valid and binding  obligation  of HOVRS  enforceable
against HOVRS in accordance with its terms,  except that such enforceability may
be  limited  by  bankruptcy,  insolvency,  reorganization,  moratorium  or other
similar  laws  affecting  or relating to  creditors'  rights  generally,  and is
subject to general  principles  of equity.  The  execution  and delivery of this
Agreement by HOVRS do not, and the consummation of the transactions contemplated
hereby will not,  conflict with, or result in any violation of, or default under
(with or without  notice or lapse of time, or both),  or give rise to a right of
termination,  cancellation or acceleration of any material obligation or loss of
any material benefit under (a) any provision of the Charter  Documents of HOVRS,
as amended; or (b) any material mortgage,  indenture,  lease,  contract or other
agreement or  instrument,  permit,  concession,  franchise,  license,  judgment,
order, decree,  statute, law, ordinance,  rule or regulation applicable to HOVRS
or any of its properties or assets,  in the case of clause (b),  except for such
conflicts,  violations,   defaults,  rights  of  termination,   cancellation  or
acceleration  as could not,  individually  or in the  aggregate,  reasonably  be
expected to have a Material Adverse Effect on HOVRS. No consent, approval, order
or  authorization   of,  or  registration,   declaration  or  filing  with,  any
Governmental  Entity is required by or with respect to HOVRS in connection  with
the execution  and delivery of this  Agreement by HOVRS or the  consummation  by
HOVRS of the transactions  contemplated hereby, except for (a) the filing of the
Certificate of Merger as provided in Section 2.2; (b) filings required under the
Exchange Act; (c) such filings as may be required

                                       27
<PAGE>

under  applicable  state  securities laws and the securities laws of any foreign
country;  (d) the  consents  set forth on Schedule  3.2 of the HOVRS  Disclosure
Schedule; and (e) such other consents,  authorizations,  filings,  approvals and
registrations  which, if not obtained or made,  could not reasonably be expected
to have a Material  Adverse Effect on HOVRS and could not reasonably be expected
to prevent,  or materially alter or delay, any of the transactions  contemplated
by this Agreement.

      3.3. Governmental  Authorization.  HOVRS has obtained each federal, state,
county, local or foreign governmental consent,  license,  permit, grant or other
authorization  of a  Governmental  Entity (a) pursuant to which HOVRS  currently
operates or holds any interest in any of its properties; or (b) that is required
for the operation of HOVRS' business or the holding of any such interest and all
of such  authorizations are in full force and effect except where the failure to
obtain or have any such authorizations  could not reasonably be expected to have
a Material Adverse Effect on HOVRS.

      3.4. Financial Statements.

            (a) HOVRS has  delivered  or made  available to Acquirer the audited
financial  statements  of HOVRS for each of the fiscal years ended  December 31,
2004, 2005 and 2006,  respectively,  and unaudited financial statements of HOVRS
on a consolidated  basis as at and for the six-month periods ended June 30, 2007
(collectively, the "HOVRS Financial Statements"). The HOVRS Financial Statements
have been prepared in accordance with GAAP (except that the unaudited  financial
statements do not contain footnotes and are subject to normal recurring year-end
audit  adjustments,  the  effect  of  which  will  not,  individually  or in the
aggregate,  be materially  adverse) applied on a consistent basis throughout the
periods presented and consistent with each other. The HOVRS Financial Statements
fairly present the consolidated financial condition,  operating results and cash
flow of HOVRS as of the dates, and for the periods,  indicated therein,  subject
to normal year-end audit adjustments and the absence of footnotes in the case of
the unaudited HOVRS Financial Statements.

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

      3.5. Capital Structure.

            (a) The  authorized  capital  stock of HOVRS  consists of 15,000,000
shares of HOVRS Common  Stock,  of which there are  8,037,670  shares issued and
outstanding as of the close of business on the date hereof, and 1,724,138 shares
of HOVRS  Preferred  Stock,  all of which are issued and  outstanding  as of the
close of business on the date  hereof.  All  outstanding  shares of HOVRS Common
Stock and HOVRS Preferred Stock have been duly authorized,

                                       28
<PAGE>

validly issued,  fully paid and are  nonassessable and to the knowledge of HOVRS
are free of any  liens or  encumbrances  other  than any  liens or  encumbrances
created  by or  imposed  upon  the  holders  thereof,  and  are not  subject  to
preemptive  rights or rights of first  refusal  created by statute,  the Charter
Documents or any agreement to which HOVRS is a party or by which it is bound.

            (b) As of the  close of  business  on the  date  hereof,  there  are
1,724,138 shares of HOVRS Common Stock reserved for issuance upon the conversion
of the outstanding  shares of HOVRS Preferred Stock. As of that same date, there
are 1,051,330 shares of HOVRS Common Stock reserved for issuance under the Hands
On Video Relay  Services,  Inc.  2004 Stock Plan,  as amended (the "HOVRS Option
Plan"), of which (i) 405,772 shares are subject to vested  outstanding  options,
(ii)  585,900  shares are subject to  unvested  outstanding  options,  and (iii)
59,658 shares are reserved for future option grants. As of that same date, there
are no outstanding  options to purchase shares of HOVRS Preferred  Stock.  HOVRS
has  delivered or made  available to Acquirer  true and complete  copies of each
form of agreement or stock option plan  evidencing  an option to purchase  HOVRS
Common  Stock.  Section  3.5(b) of the HOVRS  Disclosure  Schedule  lists  every
outstanding  option to purchase shares of HOVRS Common Stock,  and for each such
option sets forth the name of the optionee, the number of shares of HOVRS Common
Stock  subject to  purchase  upon the  exercise of the  option,  the  applicable
exercise  price  per  share  and the  shares  vested  as of the date  designated
thereon.(1)

            (c) Except for the rights  created  pursuant to or disclosed in this
Agreement or as set forth in Section 3.5 to the HOVRS Disclosure Schedule, there
are no other options,  warrants, calls, rights, commitments or agreements of any
character to which HOVRS is a party or by which it is bound, obligating HOVRS to
issue, deliver,  sell,  repurchase or redeem, or cause to be issued,  delivered,
sold,  repurchased  or  redeemed,  any  shares  of HOVRS  Common  Stock or HOVRS
Preferred  Stock, or obligating HOVRS to grant,  extend,  accelerate the vesting
of,  change  the price of, or  otherwise  amend or enter  into any such  option,
warrant, call, right, commitment or agreement. Except as contemplated hereunder,
there are no other  contracts,  commitments  or  agreements  relating to voting,
purchase or sale of HOVRS'  capital  stock (a) between or among HOVRS and any of
its  stockholders;  and (b) to the  knowledge of HOVRS,  between or among any of
HOVRS' stockholders.

      3.6. Absence of Certain Changes. Except as disclosed in Section 3.6 of the
HOVRS  Disclosure  Schedule,  since  December 31, 2006 (the "HOVRS Balance Sheet
Date"),  HOVRS has conducted its business in the ordinary course consistent with
past  practice  and there has not  occurred  (a) any change,  event or condition
(whether or not covered by insurance) that has resulted in, or could  reasonably
be  expected  to  result  in,  a  Material  Adverse  Effect  on  HOVRS;  (b) any
acquisition,  sale or transfer of any material  asset of HOVRS other than in the
ordinary course of business and consistent with past practice; (c) any change in
accounting  methods  or  practices  (including  any  change in  depreciation  or
amortization  policies or rates) by HOVRS or any  revaluation by HOVRS of any of
its assets;  (d) any  declaration,  setting  aside,  or payment of a dividend or
other distribution with respect to the shares of HOVRS or any direct or indirect
redemption,  purchase  or other  acquisition  by HOVRS of any of its  shares  of
capital  stock;  (e) the

--------
(1) HOVRS to provide missing information.

                                       29
<PAGE>

execution by HOVRS of any HOVRS Material  Contract (as defined in Section 3.14),
other than in the ordinary  course of business  and as provided to Acquirer,  or
any material  amendment or termination of, or default under,  any HOVRS Material
Contract to which HOVRS is a party or by which it is bound; (f) any amendment or
change to the Charter  Documents;  (g) any  increase in or  modification  of the
compensation  or  benefits  payable or to become  payable by HOVRS to any of its
directors or employees, other than in the ordinary course of business consistent
with past  practice;  or (h) any  negotiation or agreement by HOVRS to do any of
the things  described  in the  preceding  clauses  (a)  through  (g) (other than
negotiations  with Acquirer and its  representatives  regarding the transactions
contemplated by this Agreement). At the Effective Time, there will be no accrued
but unpaid dividends on shares of HOVRS' capital stock.

      3.7. Absence of Undisclosed Liabilities. HOVRS has no material obligations
or  material  liabilities  of  any  nature  (matured  or  unmatured,   fixed  or
contingent)  other than (a) those set forth or  adequately  provided  for in the
balance sheet of HOVRS as of the HOVRS  Balance  Sheet Date (the "HOVRS  Balance
Sheet");  (b) those incurred in the ordinary course of business and not required
to be set forth in the HOVRS Balance Sheet under GAAP; (c) those incurred in the
ordinary  course of business  since the HOVRS Balance Sheet Date and  consistent
with past practice;  and (d) those incurred in connection  with the execution of
this Agreement.

      3.8.  Litigation.  Section 3.8 of the HOVRS Disclosure Schedule identifies
private or governmental action, suit, proceeding,  claim and arbitration and, to
the knowledge of HOVRS,  investigation,  that is pending or, to the knowledge of
HOVRS, threatened,  before any Governmental Entity, foreign or domestic, against
HOVRS or any of its  properties  or any of its officers or  directors  (in their
capacities  as  such).  There  is  no  private  or  governmental  action,  suit,
proceeding,   claim  or  arbitration   or,  to  the  knowledge  of  HOVRS,   any
investigation, that is pending or, to the knowledge of HOVRS, threatened, before
any  Governmental  Entity,  foreign  or  domestic,  against  HOVRS or any of its
properties  or any of its officers or directors  (in their  capacities as such),
that,  individually or in the aggregate,  could reasonably be expected to have a
Material Adverse Effect on HOVRS. There is no judgment,  decree or order against
HOVRS, or, to the knowledge of HOVRS, any of its directors or officers (in their
capacities as such), that could prevent, enjoin or materially alter or delay any
of the transactions  contemplated by this Agreement, or that could reasonably be
expected to have a Material Adverse Effect on HOVRS.

      3.9.  Restrictions on Business Activities.  Except as set forth in Section
3.9  of  the  HOVRS  Disclosure  Schedule,  there  is  no  agreement,  judgment,
injunction,  order or decree binding upon HOVRS that has or could  reasonably be
expected to have the effect of prohibiting  or materially  impairing any current
business  practice of HOVRS, any acquisition of property by HOVRS or the conduct
of business by HOVRS as currently conducted by HOVRS.

      3.10. Intellectual Property.

            (a) For purposes of this Agreement, "Intellectual Property" means:

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

                                       30
<PAGE>

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

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

                  (iv)  trademarks,  trademark  registrations,  applications for
registration  of  trademarks,   service  marks,   service  mark   registrations,
applications for  registration of service marks,  trade name  registrations  and
registered  trade  names  and  applications  for  registrations  of trade  names
(collectively, "Trademarks") and domain name registrations;

                  (v) all trade secrets and proprietary  information  (including
with  respect to  technology,  ideas,  inventions,  designs,  manufacturing  and
operating specifications, know-how, formulae, technical data, computer programs,
hardware, software and processes); and

                  (vi) all other  intellectual  property rights and protections,
worldwide.

            (b) HOVRS owns and has good and  marketable  title to, or  possesses
legally  enforceable rights to use, all Intellectual  Property that is both used
in  and  material  to  its  business  as  currently   conducted  by  HOVRS.  The
Intellectual Property owned by or licensed to HOVRS collectively constitutes all
of the material  Intellectual  Property necessary to enable HOVRS to conduct its
business as such business is currently being conducted by it.

            (c)  For  the  purposes  of  this  Agreement,   "HOVRS  Intellectual
Property" means Intellectual  Property incorporated into any product of HOVRS or
otherwise  used in the  business  of  HOVRS  (except  "off the  shelf"  or other
software widely available through regular commercial  distribution channels at a
cost not  exceeding  Ten  Thousand  Dollars  ($10,000)  on  standard  terms  and
conditions,  as modified for HOVRS'  operations).  Section  3.10(c) of the HOVRS
Disclosure Schedule lists:

                  (i) the following  HOVRS  Intellectual  Property to the extent
owned  by  HOVRS:  (A) all  Issued  Patents  and  Patent  Applications,  (B) all
registered Trademarks and pending trademark  applications and (C) all registered
Copyrights, including the jurisdictions in which each such Intellectual Property
has been issued or registered or in which any such application for such issuance
and/or registration has been filed; and

                  (ii) the following agreements relating to each of the products
of  HOVRS  (the  "HOVRS  Products")  or  HOVRS  Intellectual  Property:  all (A)
agreements granting any right to distribute or sublicense a HOVRS Product on any
exclusive or non-exclusive basis; (B) any exclusive or non-exclusive licenses of
Intellectual Property to or from HOVRS (except "off the shelf" or other software
widely available through regular commercial  distribution

                                       31
<PAGE>

channels at a cost not  exceeding  Ten  Thousand  Dollars  ($10,000) on standard
terms and  conditions,  as  modified  for  HOVRS'  operations);  (C)  agreements
pursuant to which the amounts actually paid or payable under firm commitments to
HOVRS are Fifteen  Thousand  Dollars  ($15,000) or more;  (D) joint  development
agreements;  (E)  agreements  pursuant to which HOVRS  grants or has granted any
ownership right to any HOVRS Intellectual Property owned by HOVRS; (F) orders of
a court of competent  jurisdiction relating to HOVRS Intellectual Property owned
or used by HOVRS that are known by HOVRS; (G) any option to purchase or obtain a
license to any HOVRS  Intellectual  Property owned by HOVRS;  and (H) agreements
pursuant  to which  HOVRS  grants or has  granted any party any rights to access
source code, or to use source code or object code to create  derivative works of
HOVRS Products.

            (d) Section  3.10(d) of the HOVRS  Disclosure  Schedule  contains an
accurate list as of the date of this Agreement of all licenses,  sublicenses and
other  agreements  to which HOVRS is a party and pursuant to which (i) HOVRS has
authorized another party to use any Intellectual Property owned by HOVRS that is
material to the  business of HOVRS or (ii) to which HOVRS is  authorized  to use
any  Intellectual  Property that is owned by any third party and material to the
business of HOVRS,  excluding "off the shelf" or other software widely available
through  regular  commercial  distribution  channels at a cost not exceeding Ten
Thousand Dollars ($10,000) on standard terms and conditions  ("Third Party HOVRS
Intellectual Property").

            (e) To  the  knowledge  of  HOVRS,  there  is no  unauthorized  use,
disclosure,  infringement or misappropriation of any HOVRS Intellectual Property
owned by HOVRS by any third party,  including any employee or former employee of
HOVRS, other than such uses, disclosures,  infringements or misappropriations as
could not,  individually  or in the aggregate,  reasonably be expected to have a
Material Adverse Effect on HOVRS.  Except as disclosed in Section 3.10(e) of the
HOVRS Disclosure Schedule, HOVRS has not entered into any agreement to indemnify
any  other  Person  against  any  charge  of  infringement  of any  Intellectual
Property,  other than indemnification  provisions contained in standard sales or
other  agreements to end users arising in the ordinary  course of business,  the
forms of which have been delivered to Acquirer or its counsel.  Except  pursuant
to the agreements disclosed in Section 3.10(d) of the HOVRS Disclosure Schedule,
there are no royalties,  fees or other payments payable by HOVRS to any party by
reason  of the  ownership,  use,  sale  or  disposition  of  Third  Party  HOVRS
Intellectual Property.

            (f) Other  than  with  respect  to  matters  that  have  been  fully
resolved,  settled  and, if  applicable,  fully paid,  prior to the date hereof,
HOVRS has no knowledge of, and HOVRS has not received  written notice  asserting
any breach by HOVRS of, any license,  sublicense or other agreement  relating to
the HOVRS  Intellectual  Property or Third Party  HOVRS  Intellectual  Property.
Neither  the  execution,  delivery  or  performance  of  this  Agreement  or any
ancillary  agreement  contemplated  hereby nor the consummation of the Merger or
any of the transactions contemplated by this Agreement will contravene, conflict
with or result in any  limitation  on  Acquirer's  right to own or use any HOVRS
Intellectual Property, including any Third Party HOVRS Intellectual Property.

            (g) To the  knowledge  of  HOVRS,  all  Issued  Patents,  registered
Trademarks and registered  Copyrights  owned by HOVRS are valid and  subsisting.
With respect to any Issued Patents owned by HOVRS,  all  maintenance  and annual
fees have been fully paid. With

                                       32
<PAGE>

respect to  registered  Trademarks,  all necessary  affidavits of use,  renewals
and/or documents  evidencing accurate chain of title and ownership are currently
on file with the United  States  Patent and  Trademark  Office.  Other than with
respect to matters that have been fully  resolved,  settled and, if  applicable,
fully paid prior to the date hereof,  HOVRS has no  knowledge  of, and HOVRS has
not  received  any  written  assertion  of, any actual or alleged  infringement,
misappropriation or unlawful use by HOVRS of any Intellectual  Property owned by
any third party, and there is no proceeding pending or to the knowledge of HOVRS
threatened with respect to the foregoing.  There is no proceeding pending or, to
the knowledge of HOVRS,  threatened  with respect to, nor has HOVRS received any
written claim or demand that challenges, the legality, validity,  enforceability
or ownership of any item of HOVRS Intellectual  Property that is owned by HOVRS.
HOVRS has not brought a proceeding  alleging  infringement of HOVRS Intellectual
Property or breach of any license or agreement involving  Intellectual  Property
against any third party.

            (h) All current and former officers, employees and vendors of HOVRS,
to the extent the duties of such  officers,  employees  and vendors  involve the
handling of confidential information of Acquirer or the creation of Intellectual
Property,  have  executed  and  delivered to HOVRS an  agreement  regarding  the
protection of proprietary information and the assignment or exclusive license to
HOVRS of any Intellectual  Property arising from services performed for HOVRS by
such Persons, the form of which has been supplied to Acquirer.  To the knowledge
of  HOVRS,  no  employee  of  HOVRS is in  violation  of any  term  relating  to
Intellectual Property or confidentiality contained in any employment contract or
any  other  contract  or  agreement  relating  to the  relationship  of any such
employee with HOVRS.  To the knowledge of HOVRS,  no current or former  officer,
director  or  employee  of HOVRS has any  right,  claim or  interest  in or with
respect to any HOVRS Intellectual Property owned by HOVRS.

            (i) HOVRS has taken commercially reasonable measures and precautions
designed to protect and maintain the  confidentiality  of all trade  secrets and
proprietary  information  of HOVRS  (except such trade  secrets and  proprietary
information whose value would not be materially  impaired by public disclosure).
All  disclosure  to a third party of any trade  secrets that are material to the
businesses  of and  owned by HOVRS has been  pursuant  to the terms of a written
agreement between HOVRS and such third party, such agreement designed to protect
and maintain the confidentiality of such trade secrets.

            (j) Except as set forth in Section  3.10(j) of the HOVRS  Disclosure
Schedule  and except for any claims  that have been  resolved  prior to the date
hereof,  no product liability claims have been communicated in writing to or, to
the knowledge of HOVRS, threatened against HOVRS.

            (k) A  complete  list of  each  of the  HOVRS  Products  and  HOVRS'
proprietary  software  that is  material  to its  business  ("HOVRS  Software"),
together with a brief  description  of each, is set forth in Section  3.10(k) of
the HOVRS Disclosure Schedule.

            (l)  To  the  knowledge  of  HOVRS,  HOVRS  is  not  subject  to any
proceeding or outstanding decree,  order,  judgment,  stipulation,  or agreement
restricting  in  any  manner  the  use,  transfer  or  licensing  of  any  HOVRS
Intellectual  Property owned by HOVRS, or which may affect the validity,  use or
enforceability of such HOVRS Intellectual Property.

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<PAGE>

            (m) To the knowledge of HOVRS, no Public Software (as defined below)
forms a material part of any HOVRS Products, services provided by HOVRS or HOVRS
Intellectual  Property,  and no  Public  Software  was or is (A)  both  used  in
connection  with, and material to, the  development of any HOVRS Product,  HOVRS
service or HOVRS  Intellectual  Property  owned by HOVRS or (B) in any  material
respect is incorporated into, in whole or in part, or has been distributed with,
in whole or in part,  any HOVRS  Product,  HOVRS  service or HOVRS  Intellectual
Property  owned by HOVRS.  As used in this Section  3.10(m),  "Public  Software"
means any software that is  distributed as free software (as defined by the Free
Software Foundation),  open source software (e.g., Linux or software distributed
under  any  license  approved  by  the  Open  Source  Initiative  as  set  forth
www.opensource.org)  or similar licensing or distribution  models which requires
the  distribution of source code to licensees,  including  software  licensed or
distributed  under any of the  following  licenses or  distribution  models,  or
licenses  or  distribution  models  similar to any of the  following:  (i) GNU's
General Public  License (GPL) or  Lesser/Library  GPL (LGPL);  (ii) the Artistic
License (e.g., PERL); (iii) the Mozilla Public License; (iv) the Netscape Public
License;  (v) the Sun Community  Source  License  (SCSL);  (vi) the Sun Industry
Standards License (SISL); (vii) the BSD License; or (viii) the Apache License.

      3.11.  Interested  Party  Transactions.  HOVRS  is  not  indebted  to  any
director,  officer, employee or agent of HOVRS (except for amounts due as normal
salaries and bonuses and in  reimbursement  of ordinary  expenses),  and no such
Person is  indebted  to HOVRS.  To the  knowledge  of HOVRS,  there have been no
transactions  during the  two-year  period  ending on the date hereof that would
require  disclosure  if HOVRS  were  subject  to  disclosure  under  Item 404 of
Regulation S-K under the Securities Act.

      3.12.  Minute  Books.  The  minute  book of HOVRS  contains  a  materially
complete and accurate  summary of all meetings of directors and  stockholders or
actions by written consent since the time of  incorporation of HOVRS through the
date of this  Agreement,  and  reflects  all  transactions  referred  to in such
minutes accurately in all material respects.

      3.13.  Complete Copies of Materials.  All copies of documents delivered or
made available by HOVRS to Acquirer in connection  with Acquirer's due diligence
review of HOVRS have been true and complete copies of each such document.

      3.14. HOVRS Material  Contracts.  All of the HOVRS Material  Contracts (as
defined in this Section 3.14) are listed in Section 3.14 of the HOVRS Disclosure
Schedule.  With respect to the HOVRS Material Contracts,  except as set forth in
Section 3.14 of the HOVRS Disclosure Schedule:  (a) each HOVRS Material Contract
is legal,  valid,  binding  and  enforceable  and in full force and effect  with
respect  to  HOVRS,  and,  to  HOVRS'  knowledge,   is  legal,  valid,  binding,
enforceable  and in full force and  effect  with  respect  to each  other  party
thereto,  in  either  case  subject  to the  effect of  bankruptcy,  insolvency,
moratorium or other similar laws affecting the enforcement of creditors'  rights
generally and except as the availability of equitable remedies may be limited by
general  principles of equity; (b) each HOVRS Material Contract will continue to
be legal,  valid,  binding  and  enforceable  and in full force and effect  with
respect to HOVRS or its successor  immediately  following the Effective  Time in
accordance with its terms as in effect prior to the Effective  Time,  subject to
the effect of bankruptcy, insolvency, moratorium or other similar laws affecting
the enforcement of creditors' rights generally and except as the availability

                                       34
<PAGE>

of equitable  remedies may be limited by general  principles of equity;  and (c)
neither HOVRS nor, to HOVRS' knowledge, any other party is in breach or default,
and no event has occurred  that with notice or lapse of time would  constitute a
breach or default by HOVRS or, to HOVRS' knowledge,  by any such other party, or
permit  termination,  modification  or  acceleration,  under such HOVRS Material
Contract,  subject  to such  exceptions  as could  not,  individually  or in the
aggregate,  reasonably be expected to have a Material  Adverse  Effect on HOVRS.
HOVRS is not a party  to any  oral  contract,  agreement  or other  arrangement.
"HOVRS Material  Contract" means any contract,  agreement or commitment to which
HOVRS is a party  (a) with  expected  receipts  or  expenditures  in  excess  of
Twenty-Five  Thousand Dollars  ($25,000);  (b) required to be listed pursuant to
Section 3.10(d) or Section 3.22; (c) requiring HOVRS to indemnify any party; (d)
granting any exclusive  rights to any party;  (e)  evidencing  indebtedness  for
borrowed or loaned  money of  Twenty-Five  Thousand  Dollars  ($25,000) or more,
including  guarantees  of such  indebtedness;  or (f) that could  reasonably  be
expected to have a Material Adverse Effect on HOVRS if breached by HOVRS in such
a manner as would (I) permit  any other  party to cancel or  terminate  the same
(with or without notice or passage of time);  (II) provide a basis for any other
party to claim money damages  (either  individually or in the aggregate with all
other such claims under that contract) from HOVRS; or (III) give rise to a right
of acceleration of any material obligation or loss of any material benefit under
such HOVRS Material Contract.

      3.15.  Inventory.  HOVRS has no  inventory as of the HOVRS  Balance  Sheet
Date.  Any inventory  acquired  subsequent to such date and prior to the Closing
shall  have  been or be  acquired  and  maintained  in the  ordinary  course  of
business,  shall have been or be of good and merchantable  quality, and consists
or will  consist of items of a  quantity  and  quality  usable or salable in the
ordinary course of business. The values at which any inventories will be carried
will reflect an inventory  valuation  policy of HOVRS that is in accordance with
GAAP applied on a consistent basis. HOVRS is not under any material liability or
obligation with respect to the return of any item of inventory in the possession
of  wholesalers,  retailers or other  customers.  Since the HOVRS  Balance Sheet
Date,  adequate  provision  has been made on the books of HOVRS in the  ordinary
course of business in  accordance  with GAAP  applied on a  consistent  basis to
provide for all material slow-moving,  obsolete or unusable inventories to their
estimated  useful or scrap values,  and such inventory  reserves are adequate to
provide  for such  slow-moving,  obsolete or unusable  inventory  and  inventory
shrinkage.

      3.16. Accounts Receivable.  Subject to any reserves set forth therein, the
accounts  receivable  shown on the  HOVRS  Financial  Statements  are  valid and
genuine,  have  arisen  solely out of bona fide sales and  deliveries  of goods,
performance of services,  and other business transactions in the ordinary course
of business  consistent with past practices in each case with Persons other than
affiliates, are not subject to any prior assignment,  lien or security interest,
and to HOVRS'  knowledge are not subject to valid defenses,  set-offs or counter
claims.  The accounts  receivable are collectible in accordance with their terms
at their recorded amounts,  subject only to the reserve for doubtful accounts on
the HOVRS Financial Statements.

      3.17. Customers and Suppliers.  Except as set forth in Section 3.17 of the
HOVRS Disclosure Schedule,  as of the date hereof, no customer that individually
accounted  for more than five percent (5%) of HOVRS' gross  revenues  during the
12-month  period  preceding  the date  hereof  and no  supplier  of  HOVRS  that
individually  accounted  for more than  five  percent  (5%) of HOVRS'  purchases
during the 12-month  period  preceding the date hereof has canceled

                                       35
<PAGE>

or  otherwise  terminated,  or made any  written  threat  to HOVRS to  cancel or
otherwise  terminate its relationship  with HOVRS or has at any time on or after
the HOVRS Balance Sheet Date,  decreased  materially its services or supplies to
HOVRS in the case of any  supplier,  or its usage of the services or products of
HOVRS in the case of such customer, and to HOVRS' knowledge, no such supplier or
customer has indicated  either orally or in writing that it intends to cancel or
otherwise  terminate its relationship  with HOVRS or to decrease  materially its
services or supplies to HOVRS or its usage of the services or products of HOVRS,
as the case may be. HOVRS has not  knowingly  breached any  agreement  with,  or
engaged in any  fraudulent  conduct with respect to, any customer or supplier of
HOVRS, so as to provide a benefit to HOVRS that was not intended by the parties.

      3.18.  Employees  and  Consultants.  Section 3.18 of the HOVRS  Disclosure
Schedule  contains  a list of the  names  of all  employees  (including  without
limitation  part-time  employees and  temporary  employees),  leased  employees,
independent contractors and consultants of HOVRS, together with their respective
salaries  or wages,  other  compensation,  dates of  employment  and  positions.
Section 3.18 of the HOVRS  Disclosure  Schedule  also  describes  all  severance
benefits to which any HOVRS employee is or may become  entitled  pursuant to any
agreement between HOVRS and such employee.

      3.19. Title to Property. HOVRS has good and marketable title to all of its
properties,  interests in properties and assets, real and personal, reflected in
the HOVRS Balance  Sheet or acquired  after the HOVRS Balance Sheet Date (except
properties,  interests in  properties  and assets sold or otherwise  disposed of
since the HOVRS Balance Sheet Date in the ordinary course of business),  or with
respect to leased properties and assets, valid leasehold interests therein, free
and clear of all mortgages,  liens, pledges, charges or encumbrances of any kind
or character,  except (a) the lien of current taxes not yet due and payable; (b)
such  imperfections  of  title,  liens  and  easements  as do not and  will  not
materially  detract from or  interfere  with the use of the  properties  subject
thereto or affected thereby, or otherwise  materially impair business operations
involving  such  properties;  (c) liens  securing  debt that is reflected on the
HOVRS Balance Sheet or listed in Section 3.19 of the HOVRS Disclosure  Schedule;
and (d) such other mortgages,  liens, pledges,  charges or encumbrances as could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse  Effect on HOVRS.  The plants,  property and equipment of HOVRS that are
used in the  operations  of its business  are in all  material  respects in good
operating condition and repair,  subject to normal wear and tear. All properties
used in the  operations of HOVRS are reflected in the HOVRS Balance Sheet to the
extent  required by GAAP. All leases to which HOVRS is a party are in full force
and  effect  and are  valid,  binding  and  enforceable  in  respect of HOVRS in
accordance with their respective  terms,  except as such  enforceability  may be
limited by bankruptcy, insolvency, moratorium or other similar laws affecting or
relating  to  creditors'  rights  generally  and general  principles  of equity,
regardless  of whether  asserted in a proceeding  in equity or at law.  True and
correct  copies of all such  leases  have been  provided  or made  available  to
Acquirer. HOVRS own no real property.

      3.20. Environmental Matters.

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

                                       36
<PAGE>

                  (i)  "Environmental  Laws" shall mean any applicable  foreign,
federal,  state or local  governmental laws (including  common laws),  statutes,
ordinances,   codes,   regulations,    rules,   policies,   permits,   licenses,
certificates, approvals, judgments, decrees, orders, directives, or requirements
that pertain to the protection of the  environment,  protection of public health
and safety,  or protection  of worker health and safety,  or that pertain to the
handling, use, manufacturing,  processing,  storage, treatment,  transportation,
discharge,  release, emission,  disposal, re-use, recycling, or other contact or
involvement  with  Hazardous  Materials  (as  defined  in  Section  3.20(a)(ii),
including, without limitation, the federal Comprehensive Environmental Response,
Compensation  and  Liability  Act of 1980,  42 U.S.C.  Section 9601, et seq., as
amended  ("CERCLA"),and  the federal Resource  Conservation and Recovery Act, 42
U.S.C. Section 6901, et seq., as amended ("RCRA").

                  (ii) "Hazardous Materials" shall mean any material,  chemical,
compound,  substance,  mixture  or  by-product  that  is  identified,   defined,
designated,  listed,  restricted or otherwise regulated under Environmental Laws
as  a  "hazardous   constituent,"   "hazardous  substance,"  "hazardous  waste,"
"hazardous waste constituent,"  "infectious waste," "medical waste," "biomedical
waste," "pollutant," "toxic pollutant,"  "contaminant" or any other statutory or
regulatory   terminology   intended  to   classify   or   identify   substances,
constituents,  materials or wastes by reason of properties  that are deleterious
to the  environment,  natural  resources,  worker  health and safety,  or public
health and  safety,  including  without  limitation  ignitability,  corrosivity,
reactivity,  carcinogenicity,  toxicity  and  reproductive  toxicity.  The  term
"Hazardous   Materials"   shall  include   without   limitation  any  "hazardous
substances"  as defined,  listed,  designated  or regulated  under  CERCLA,  any
"hazardous wastes" or "solid wastes" as defined, listed, designated or regulated
under RCRA, any asbestos or asbestos-containing  materials,  any polychlorinated
biphenyls, and any petroleum or hydrocarbonic substance, fraction, distillate or
by-product.

            (b) To the  knowledge  of HOVRS,  HOVRS is and has been in  material
compliance with all  Environmental  Laws applicable to HOVRS and relating to the
properties  or  facilities  used,  leased  or  occupied  by  HOVRS  at any  time
(collectively,  "HOVRS'  Facilities;"  such  properties or facilities  currently
used,  leased  or  occupied  by HOVRS are  defined  herein  as  "HOVRS'  Current
Facilities"),  and no discharge,  emission,  release, leak or spill of Hazardous
Materials  has  occurred at any of HOVRS'  Facilities  during  HOVRS'  occupancy
thereof that could  reasonably be expected to give rise to a material  liability
of HOVRS  under  Environmental  Laws.  To  HOVRS'  knowledge,  (i)  there are no
Hazardous  Materials  (including  without  limitation  asbestos)  present in the
surface  waters,  structures,  groundwaters or soils of or beneath any of HOVRS'
Current Facilities in a condition,  or in concentrations or amounts,  that could
reasonably be expected to give rise to a material liability of HOVRS, (ii) there
neither  are nor have been any  aboveground  or  underground  storage  tanks for
Hazardous  Materials  at HOVRS'  Current  Facilities  except as are operated and
maintained,  or removed,  in material  compliance with applicable  Environmental
Laws,  and (iii) no HOVRS  employee or other Person has asserted in writing that
HOVRS is liable for alleged injury or illness resulting from an alleged exposure
to a  Hazardous  Material.  Except  as set  forth in  Section  3.20 of the HOVRS
Disclosure Schedule, no civil, criminal or administrative action,  proceeding or
investigation  is pending  against HOVRS,  or, to HOVRS'  knowledge,  threatened
against HOVRS,  alleging a material liability of HOVRS with respect to Hazardous
Materials or a material violation of Environmental Laws.

                                       37
<PAGE>

      3.21.  Taxes.  HOVRS makes the following  representations  with respect to
Taxes:

            (a) HOVRS has  prepared and timely filed (or will prepare and timely
file) all Tax Returns  required to be filed by HOVRS for any period ending on or
before the Closing Date.  All Tax Returns filed by HOVRS are true and correct in
all material respects and have been completed in accordance with Applicable Law,
and all material  Taxes shown to be due on such Tax Returns,  and other material
Taxes that are due for which no Tax Returns are required to be filed,  have been
timely  paid.  To the  extent  Taxes are not due,  adequate  reserves  have been
established  on the HOVRS  Balance Sheet with respect to accrued taxes up to the
HOVRS  Balance  Sheet  Date in  accordance  with GAAP as  applied  by HOVRS on a
consistent basis with prior periods. HOVRS has no knowledge of any basis for the
assertion of a liability  for unpaid  Taxes with respect to accrued  Taxes up to
the HOVRS  Balance  Sheet  Date that are not  established  on the HOVRS  Balance
Sheet. HOVRS has no knowledge that it has incurred any liability for Taxes after
the HOVRS Balance Sheet Date other than in the ordinary  course of business that
may be material.  HOVRS has delivered or made available to the Acquirer true and
correct  copies of all income and  franchise  Tax Returns,  closing  agreements,
examination  reports or other similar  reports,  and statements of  deficiencies
filed,  assessed  against or agreed to by, or on behalf of, HOVRS since December
31, 2003.

            (b)  There are no audits by any  taxing  authority  pending  against
HOVRS or any predecessor  entity and HOVRS has not received  written notice from
any taxing  authority  that it is  conducting  or intends to conduct an audit or
investigation.  HOVRS has not waived or extended any statute of  limitations  in
respect of Taxes or Tax Returns or agreed to any  extension of time with respect
to a Tax assessment, reassessment,  deficiency or with respect to the payment of
any Taxes.  HOVRS is not a party to any power of attorney  with respect to a Tax
matter that is  currently  in force or  otherwise  bound by any  private  letter
ruling of the IRS or comparable rulings issued by any other taxing authority.

            (c) No claims  have been made by a taxing  authority  in  writing to
HOVRS in a  jurisdiction  where HOVRS does not file Tax Returns that HOVRS is or
may be subject to taxation by that  jurisdiction.  No issue has been raised by a
taxing  authority in writing to HOVRS in any current or most recent  examination
which,  by application of the same or similar  principles,  would  reasonably be
expected to affect the Tax treatment of HOVRS in any taxable  period (or portion
thereof) ending after the Closing Date.

            (d) HOVRS  does not have (i) any  liability  for the  payment of any
Taxes as a result of being a member of an  affiliated,  consolidated,  combined,
unitary or similar group or as a result of transferor or successor  liability or
by operation of  Applicable  Law, and (ii) any  liability for the payment of any
amounts as a result of being a party to, or bound by, any tax sharing  agreement
or as a result of any  express  or implied  obligation  to  indemnify  any other
Person with respect to Taxes.

            (e) HOVRS has  disclosed  to  Acquirer  (i) any Tax  exemption,  Tax
holiday or other  Tax-sparing  arrangement  that HOVRS has in any  jurisdiction,
including  the  nature,  amount and lengths of such Tax  exemption,  Tax holiday
orother  Tax-sparing  arrangement;  and  (ii) any  expatriate  tax  programs  or
policies  affecting HOVRS.  HOVRS is in compliance in all material respects with
all terms and conditions required to maintain such Tax exemption, Tax holiday or

                                       38
<PAGE>

other  Tax-sparing  arrangement  or order  of any  governmental  entity  and the
consummation of the transactions  contemplated  hereby will not have any adverse
effect on the continuing  validity and  effectiveness of any such Tax exemption,
Tax holiday or other Tax-sparing arrangement or order.

            (f) HOVRS is not,  and has not been  during  the  applicable  period
specified in Section 897(c)(1)(A)(ii) of the Code, a United States real property
holding corporation within the meaning of section 897(c)(2) of the Code.

            (g)  HOVRS  is not a  party  to any  contract,  agreement,  plan  or
arrangement,  including  but not limited to the  provisions  of this  Agreement,
covering  any  employee  or  former  employee  of HOVRS  that,  individually  or
collectively,  could give rise to the  payment  of any amount  that would not be
deductible  pursuant  to  Sections  280G  of the  Code  by  HOVRS  or any of its
Subsidiaries,  or that  would be  subject  to an excise Tax by reason of Section
4999 of the Code.

            (h) Schedule 3.21(h)  contains a list enumerating each  jurisdiction
in which HOVRS is required to pay Taxes or file Tax Returns and  specifying  the
type of Taxes paid and Tax Returns filed in that jurisdiction.

            (i)  HOVRS  (i) has  complied  in all  material  respects  with  all
Applicable Laws,  rules and regulations  relating to the payment and withholding
of Taxes, (ii) has timely and properly paid over to the applicable  governmental
authorities all amounts  required to be so withheld from all payments made by or
on behalf of HOVRS  (including,  but not limited to, employee wages and payments
to independent contractors) and (iii) is not liable for any Taxes for failure to
comply with such laws, rules and regulations.

            (j) HOVRS has not distributed the stock of any  corporation,  or had
its stock  distributed by another person, in a transaction that was purported or
intended to be governed in whole or in part by Section 355 of the Code.

            (k) No property of HOVRS (i) is tax exempt use  property  within the
meaning of Section  168(h) or Section  470(c)(2) of the Code,  (ii)  directly or
indirectly secures any debt the interest on which is exempt under Section 103(a)
of the Code or (iii) is  required  to be  treated  as being  owned by any Person
(other  than HOVRS)  pursuant  to the  provisions  of Section  168(f)(8)  of the
Internal Revenue Code of 1954, as amended,  and in effect immediately before the
Tax Reform Act of 1986.

            (l) HOVRS has disclosed on its U.S.  federal  income tax returns all
positions taken therein that could give rise to a substantial  understatement of
federal income Tax within the meaning of Section 6662 of the Code. HOVRS has not
engaged  in a  reportable  transaction  described  in  Section  1.6011-4  of the
Treasury Regulations.

      3.22. Employee Benefit Plans.

            (a)  Section  3.22  of the  HOVRS  Disclosure  Schedule  contains  a
complete and accurate list of each plan, program,  policy,  practice,  contract,
agreement  or  other   arrangement   providing  for  employment,   compensation,
retirement,  deferred compensation,  loans, severance,

                                       39
<PAGE>

separation,  relocation,   repatriation,   expatriation,  visas,  work  permits,
termination pay,  performance  awards,  bonus,  incentive,  stock option,  stock
purchase,  stock bonus,  phantom stock, stock appreciation  right,  supplemental
retirement,  fringe  benefits,  cafeteria  benefits or other  benefits,  whether
written or unwritten,  including without limitation each "employee benefit plan"
within the meaning of Section 3(3) of the Employee  Retirement  Income  Security
Act of 1974, as amended ("ERISA"), which is sponsored,  maintained,  contributed
to, or  required to be  contributed  to by HOVRS and,  with  respect to any such
plans which are subject to Code Section 401(a),  any trade or business  (whether
or not incorporated)  that is treated as a single employer with HOVRS within the
meaning of Section 414(b),  (c), (m) or (o) of the Code, (an "ERISA  Affiliate")
for the benefit of any Person who  performs or who has  performed  services  for
HOVRS or with respect to which HOVRS or any ERISA  Affiliate has or may have any
liability  (including  without  limitation  contingent  liability) or obligation
(collectively, the "HOVRS Employee Plans").

            (b)  Documents.  HOVRS has  furnished or made  available to Acquirer
true and complete  copies of  documents  embodying  each of the  existing  HOVRS
Employee Plans and related plan documents,  including  without  limitation trust
documents,  group annuity  contracts,  plan  amendments,  insurance  policies or
contracts,  participant  agreements,  employee booklets,  administrative service
agreements,  summary plan  descriptions,  summaries  of material  modifications,
compliance and  nondiscrimination  tests for the last three plan years, standard
COBRA forms and related notices,  registration  statements and prospectuses and,
to the extent  still in its  possession,  any material  employee  communications
relating  thereto.  With respect to each HOVRS  Employee Plan that is subject to
ERISA reporting requirements, HOVRS has provided copies of the Form 5500 reports
filed for the last three (3) plan years.  HOVRS has furnished  Acquirer with the
most recent Internal Revenue Service determination or opinion letter issued with
respect to each such HOVRS Employee Plan,  and to HOVRS'  knowledge  nothing has
occurred  since the  issuance  of each such  letter  that  could  reasonably  be
expected  to cause the loss of the  tax-qualified  status of any HOVRS  Employee
Plan subject to Code Section 401(a).

            (c) Compliance.  (i) Each HOVRS Employee Plan has been  administered
in accordance with its terms and in compliance with the requirements  prescribed
by any and all statutes,  rules and regulations  (including ERISA and the Code),
except as could not  reasonably  be  expected  to have,  individually  or in the
aggregate,  a  Material  Adverse  Effect  on HOVRS;  and  HOVRS  and each  ERISA
Affiliate  have performed all material  obligations  required to be performed by
them under,  are not in material  respect in default  under or  violation of and
have no knowledge  of any  material  default or violation by any other party to,
any of the HOVRS  Employee  Plans;  (ii) any HOVRS  Employee Plan intended to be
qualified  under  Section  401(a) of the Code is either  subject to a  favorable
determination letter or opinion letter issued by the Internal Revenue Service as
to its  qualified  status  under the Code,  including  all  currently  effective
amendments to the Code, or has time remaining to apply under applicable Treasury
Regulations or Internal  Revenue Service  pronouncements  for a determination or
opinion  letter  and to make any  amendments  necessary  to  obtain a  favorable
determination or opinion letter; (iii) none of the HOVRS Employee Plans promises
or provides  retiree  medical or other  retiree  welfare  benefits to any Person
(except to the extent  required to comply with  "COBRA" (as defined in paragraph
(e)  below)  or any  similar  state  law);  (iv)  there  has been no  non-exempt
"prohibited  transaction,"  as such term is defined  in Section  406 of ERISA or
Section 4975 of the Code,  with respect to any HOVRS  Employee Plan; (v) neither
HOVRS nor any ERISA  Affiliate

                                       40
<PAGE>

is subject to any liability or penalty  under  Sections 4976 through 4980 of the
Code or Title I of ERISA  with  respect  to any HOVRS  Employee  Plan;  (vi) all
material  contributions  required to be made by HOVRS or any ERISA  Affiliate to
any HOVRS Employee Plan have been paid or accrued in accordance  with Applicable
Law;  (vii) with respect to each HOVRS  Employee  Plan,  no  "reportable  event"
within the meaning of Section 4043 of ERISA  (excluding any such event for which
the thirty (30) day notice  requirement has been waived under the regulations to
Section 4043 of ERISA) nor any event  described in Section 4062, 4063 or 4041 or
ERISA has  occurred;  (viii)  each  HOVRS  Employee  Plan  subject  to ERISA has
prepared  in good faith and timely  filed all  requisite  governmental  reports,
which were true and correct as of the date filed,  and has  properly  and timely
filed and distributed or posted all notices and reports to employees required to
be filed,  distributed  or posted with respect to each such HOVRS  Employee Plan
except where such failure  would result in a material  liability;  (ix) no suit,
administrative  proceeding,  action or other litigation has been brought,  or to
the knowledge of HOVRS is threatened,  against or with respect to any such HOVRS
Employee  Plan,  including  any audit or  inquiry  by the IRS or  United  States
Department of Labor; (x) except as contemplated by this Agreement there has been
no amendment to, written  interpretation  or  announcement by HOVRS or any ERISA
Affiliate that would  materially  increase the expense of maintaining  any HOVRS
Employee Plan above the level of expense  incurred with respect to that Plan for
the most recent fiscal year included in the HOVRS Financial Statements; and (xi)
no HOVRS Employee Plan is required to comply with any foreign law.

            (d) No Title IV or Multiemployer  Plan.  Neither HOVRS nor any ERISA
Affiliate  has  ever  maintained,   established,   sponsored,  participated  in,
contributed  to, or is obligated  to  contribute  to, or otherwise  incurred any
obligation or liability (including without limitation any contingent  liability)
under any "multiemployer  plan" (as defined in Section 3(37) of ERISA) or to any
"pension  plan" (as  defined  in Section  3(2) of ERISA)  subject to Title IV of
ERISA or Section 412 of the Code.  Neither HOVRS nor any ERISA Affiliate has any
actual or potential  withdrawal  liability  (including  without  limitation  any
contingent  liability)  for any  complete or partial  withdrawal  (as defined in
Sections 4203 and 4205 of ERISA) from any multiemployer plan.

            (e) COBRA,  FMLA, HIPAA,  Cancer Rights.  With respect to each HOVRS
Employee  Plan,  HOVRS  has  complied  with  (i)  the  applicable   health  care
continuation  and  notice   provisions  of  the   Consolidated   Omnibus  Budget
Reconciliation Act of 1985 ("COBRA") and the regulations thereunder or any state
law  governing  health  care  coverage  extension  or  continuation;   (ii)  the
applicable  requirements  of the  Family and  Medical  Leave Act of 1993 and the
regulations  thereunder;   (iii)  the  applicable  requirements  of  the  Health
Insurance  Portability and  Accountability  Act of 1996 ("HIPAA");  and (iv) the
applicable  requirements of the Cancer Rights Act of 1998,  except to the extent
that such failure to comply could not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect on HOVRS. HOVRS has no material
unsatisfied  obligations  to  any  employees,   former  employees  or  qualified
beneficiaries  pursuant to COBRA,  HIPAA or any state law governing  health care
coverage extension or continuation.

            (f) Effect of  Transaction.  The  consummation  of the  transactions
contemplated  by this Agreement will not either alone or in conjunction  with an
individual's  termination  of employment or service or a change in the terms and
conditions of employment or

                                       41
<PAGE>

service (i) entitle any current or former employee or other service  provider of
HOVRS  or any  ERISA  Affiliate  to  severance  benefits  or any  other  payment
(including without limitation unemployment compensation, golden parachute, bonus
or benefits under any HOVRS Employee Plan), except as expressly provided in this
Agreement;  or (ii)  accelerate  the  time of  payment  or  vesting  of any such
benefits or increase the amount of compensation due any such employee or service
provider. No benefit payable or that may become payable by HOVRS pursuant to any
HOVRS  Employee  Plan or as a result of or arising  under this  Agreement  shall
constitute an "excess  parachute  payment" (as defined in Section  280G(b)(1) of
the Code)  subject to the  imposition of an excise Tax under Section 4999 of the
Code or the deduction for which would be disallowed by reason of Section 280G of
the Code.  Each HOVRS  Employee  Plan can be amended,  terminated  or  otherwise
discontinued  after the  Effective  Time in accordance  with its terms,  without
material  liability  to  Acquirer or HOVRS  other than  ordinary  administration
expenses typically incurred in a termination event.

      3.23.  Employee  Matters.  HOVRS is in compliance in all material respects
with  all  currently  Applicable  Laws  and  regulations  respecting  terms  and
conditions of employment,  including without  limitation  applicant and employee
background  checking,  immigration laws,  discrimination  laws,  verification of
employment  eligibility,  employee  leave  laws,  classification  of  workers as
employees and  independent  contractors,  wage and hour laws,  and  occupational
safety and health laws, except for such  noncompliance that could not reasonably
be expected to have, individually or in the aggregate, a Material Adverse Effect
on HOVRS.  Except as specified in Section 3.8 of the HOVRS Disclosure  Schedule,
as of the date of this Agreement, there are no proceedings pending or, to HOVRS'
knowledge,  reasonably  expected or threatened,  between HOVRS, on the one hand,
and any or all of its  current or former  employees,  on the other  hand,  which
proceedings  could  reasonably be expected to have, a Material Adverse Effect on
HOVRS,  including without limitation any claims for actual or alleged harassment
or discrimination  based on race, national origin, age, sex, sexual orientation,
religion,  disability, or similar tortious conduct, breach of contract, wrongful
termination,  defamation,  intentional  or  negligent  infliction  of  emotional
distress,  interference with contract or interference with actual or prospective
economic  disadvantage.  HOVRS  is  not a  party  to any  collective  bargaining
agreement or other labor union  contract,  nor does HOVRS know of any activities
or  proceedings  of any  labor  union  to  organize  its  employees.  To  HOVRS'
knowledge, HOVRS has provided all employees with all wages, benefits, relocation
benefits, stock options, bonuses and incentives, and all other compensation that
became due and payable  through the date of this  Agreement.  No "mass  layoff",
"plant  closing"  or  similar  event as defined  by the  Worker  Adjustment  and
Notification Act (29 U.S.C. ss. 2101 et seq.) with respect to HOVRS has occurred
nor is expected to occur as a result of this Agreement.

      3.24. Insurance. HOVRS has policies of insurance and bonds of the type and
in amounts customarily carried by Persons conducting businesses or owning assets
similar to those of HOVRS.  There is no material claim pending under any of such
policies  or bonds as to which  coverage  has been  denied,  disputed  or to the
knowledge of HOVRS questioned by the underwriters of such policies or bonds. All
premiums  due and payable  under all such  policies and bonds have been paid and
HOVRS is otherwise in compliance in all material respects with the terms of such
policies and bonds. HOVRS has no knowledge of any threatened  termination of, or
material premium increase with respect to, any of such policies.

                                       42
<PAGE>

      3.25.  Compliance With Laws.  HOVRS has complied with, is not in violation
of and has not  received any written  notices of violation  with respect to, any
federal state,  local or foreign statute,  law or regulation with respect to the
conduct of its business,  or the ownership or operation of its business,  except
for such violations or failures to comply as could not reasonably be expected to
have a Material Adverse Effect on HOVRS.

      3.26.  Brokers' and Finders'  Fee.  Except as set forth in Section 3.26 of
the HOVRS  Disclosure  Schedule,  HOVRS has not entered into any  arrangement or
agreement with any broker, finder or investment banker that would be entitled to
brokerage or finders' fees or agents' commissions or investment bankers' fees or
any similar charges from HOVRS in connection with the Merger,  this Agreement or
any transaction contemplated hereby.

      3.27. Privacy Policies and Web Site Terms and Conditions.

            (a) For purposes of this Section 3.27:

                  (i)  "HOVRS  Sites"  means all of HOVRS'  public  sites on the
World Wide Web; and

                  (ii) "HOVRS Privacy Statements" means,  collectively,  any and
all of HOVRS'  privacy  policies  published on the HOVRS Sites or otherwise made
publicly  available  by  HOVRS  regarding  the  collection,  retention,  use and
distribution  of the personal  information of  individuals,  including,  without
limitation, from visitors of any of the HOVRS Sites ("Individuals").

            (b)  HOVRS is in  material  compliance  with (i) the  HOVRS  Privacy
Statements as applicable to any given set of personal  information  collected by
HOVRS from  Individuals;  and (ii) all applicable  privacy laws and  regulations
regarding the collection, retention, use and disclosure of personal information.

            (c)  HOVRS  has  not  received  written  notice  of  any  claims  or
controversies  regarding  the HOVRS  Privacy  Statements  or the  implementation
thereof.

      3.28. International Trade Matters. HOVRS is, and at all times has been, in
material  compliance  with and has not been and is not in material  violation of
any  International  Trade  Law,  including  but not  limited  to,  all  laws and
regulations  related  to the import and  export of  commodities,  software,  and
technology  from and into the United States,  and the payment of required duties
and tariffs in connection with same.  HOVRS has no basis to expect,  and neither
HOVRS  nor  any  other  Person  for  whose  conduct  it is or may be  held to be
responsible  has received,  any actual or  threatened  order,  notice,  or other
communication from any governmental body of any actual or potential violation or
failure to comply with any International Trade Law.

      3.29. Proxy Statement and Information  Statement.  None of the information
to be supplied by HOVRS or any of its  accountants,  counsel or other authorized
representatives  for inclusion in the  Preliminary  Proxy Statement or the HOVRS
Information  Statement  will,  at the time of the  mailing  thereof to the HOVRS
Stockholders,  or for inclusion in the Proxy  Statement will, at the time of the
mailing thereof to the stockholders of Acquirer or at the time of the meeting of
the  stockholders of Acquirer to be held in connection with the Merger,  contain
any

                                       43
<PAGE>

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  light  of  the  circumstances  under  which  they  are  made,  not
misleading, it being understood and agreed that no representation or warranty is
made by HOVRS with  respect  to any  information  supplied  by  Acquirer  or its
accountants,  counsel or other authorized representatives.  If at any time prior
to the  Effective  Time any event  with  respect  to HOVRS or its  officers  and
directors  shall occur which is or should be described in an amendment  of, or a
supplement  to, the Proxy  Statement,  such event shall be so described  and the
presentation  in such  amendment  or  supplement  of such  information  will not
contain any statement which, at the time and in light of the circumstances under
which it is made,  is false or  misleading  in any material  respect or omits to
state any material fact  required to be stated  therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not false or misleading.

      3.30.  No  Other  Representations.  Except  for  the  representations  and
warranties  contained  in this  Section 3 (as  modified by the HOVRS  Disclosure
Schedule), neither HOVRS nor any other Person makes any other express or implied
representation   or  warranty   with  respect  to  HOVRS  or  the   transactions
contemplated by this Agreement, and HOVRS disclaims any other representations or
warranties, whether made by HOVRS or any of its affiliates, officers, directors,
employees,  agents  or  representatives.  Except  for  the  representations  and
warranties  contained  in this  Section 3 (as  modified by the HOVRS  Disclosure
Schedule),  HOVRS hereby  disclaims  all liability  and  responsibility  for any
representation,  warranty, projection, forecast, statement, or information made,
communicated,  or furnished (orally or in writing) to Acquirer, HOVRS Merger Sub
or  any  of  their  affiliates  or   representatives   (including  any  opinion,
information,  projection,  or advice  that may have been or may be  provided  to
Acquirer  by  any   director,   officer,   employee,   agent,   consultant,   or
representative  of the HOVRS or any of its affiliates or  representatives).  The
disclosure of any matter or item in the HOVRS  Disclosure  Schedule shall not be
deemed to constitute an  acknowledgement  that any such matter is required to be
disclosed.

      3.31. Board Approval. The board of directors of HOVRS, by resolutions duly
adopted at a meeting  duly  called and held and not  subsequently  rescinded  or
modified  in any  way,  has duly  (i)  approved  this  Agreement  and the  other
documents  contemplated  hereunder,  together  with  the  Merger  and the  other
transactions  contemplated hereby, and (ii) recommended that the stockholders of
HOVRS approve this Agreement, the Merger and the other transactions contemplated
hereby.

4. Representations and Warranties of Acquirer.  Acquirer represents and warrants
to HOVRS  and the  HOVRS  Stockholders  that the  statements  contained  in this
Section 4 are true and  correct,  except as disclosed in a document of even date
herewith and delivered by Acquirer to HOVRS on the date hereof  referring to the
representations  and  warranties in this  Agreement  (the  "Acquirer  Disclosure
Schedule")  (it being  understood  and agreed that the disclosure set forth in a
specific section or subsection of Acquirer Disclosure Schedule shall qualify the
representations  and  warranties  set  forth in the  corresponding  section  and
subsection  of this  Section 4  (whether  or not a specific  cross-reference  is
included  therein)  if and to the extent that it is  reasonably  apparent on the
face of such disclosure  that such  disclosure  applies to such other section or
subsection, and that the representation and warranties provided hereunder may be
qualified by disclosures made by Acquirer in its public filings with the SEC, if
and only to the

                                       44
<PAGE>

extent such filing is reasonably  identified by report captions or otherwise
when cross-referenced on the Acquirer Disclosure Schedule).  For purposes of the
representations  and  warranties  set forth in this  Section 4 only,  unless the
context  otherwise  requires,  the term "Acquirer"  shall mean "Acquirer and its
Subsidiaries, taken as a whole."

      4.1.  Organization,  Standing and Power. Each of Acquirer and HOVRS Merger
Sub is a corporation duly organized, validly existing and in good standing under
the laws of the State of  Delaware.  Except as  described  in Section 4.1 of the
Acquirer  Disclosure  Schedule,  every  other  Subsidiary  of  Acquirer  is duly
organized,  validly  existing  and  in  good  standing  under  the  laws  of the
jurisdiction  in which it is  organized.  Acquirer  and  HOVRS  Merger  Sub have
corporate  power  to own  their  respective  properties  and to  carry  on their
respective  businesses  as now  being  conducted  and is  duly  qualified  to do
business and is in good standing in each jurisdiction in which the failure to be
so  qualified  and in good  standing  could  reasonably  be  expected  to have a
Material  Adverse Effect on Acquirer.  Acquirer has delivered a true and correct
copy of the  Charter  Documents  of  Acquirer,  HOVRS  Merger  Sub and any other
Subsidiary  of Acquirer,  each as amended to date, to HOVRS.  Neither  Acquirer,
HOVRS Merger Sub nor any other  Subsidiary of Acquirer is in violation of any of
the provisions of its Charter  Documents.  Except as set forth on Section 4.1 of
the Acquirer Disclosure Schedule and other than its Subsidiaries,  Acquirer does
not own  directly  or  indirectly  any  equity or  similar  interest  in, or any
interest  convertible or exchangeable or exercisable  for, any equity or similar
interest  in, any  corporation,  partnership,  joint  venture or other  business
association or entity.

      4.2. Authority. Acquirer and HOVRS Merger Sub have all requisite corporate
power  and  authority  to  enter  into  this  Agreement  and to  consummate  the
transactions  contemplated  hereby. The execution and delivery of this Agreement
and the  consummation  of the  transactions  contemplated  hereby have been duly
authorized by all necessary  corporate  action on the part of Acquirer and HOVRS
Merger Sub,  subject  only to the  approval of the Merger,  the  issuance of the
Acquirer Common Stock pursuant to this Agreement and such other matters as shall
be  required  by Nasdaq in  connection  with the  consummation  of the Merger by
Acquirer's  stockholders as contemplated in Section 6.4. This Agreement has been
duly  executed and  delivered by Acquirer and HOVRS Merger Sub, and  constitutes
the valid and binding  obligation  of Acquirer and HOVRS Merger Sub  enforceable
against Acquirer and HOVRS Merger Sub in accordance with its terms,  except that
such  enforceability may be limited by bankruptcy,  insolvency,  reorganization,
moratorium  or other  similar laws  affecting or relating to  creditors'  rights
generally,  and is subject to general  principles  of equity.  The execution and
delivery of this  Agreement  by Acquirer  and HOVRS  Merger Sub do not,  and the
consummation of the transactions contemplated hereby will not, conflict with, or
result in any violation of, or default under (with or without notice or lapse of
time,  or  both),  or give  rise  to a right  of  termination,  cancellation  or
acceleration  of any material  obligation or loss of any material  benefit under
(a) any provision of the Charter Documents of Acquirer,  HOVRS Merger Sub or any
of their  Subsidiaries,  as amended;  or (b) any material  mortgage,  indenture,
lease, contract or other agreement or instrument, permit, concession, franchise,
license,  judgment,  order, decree, statute, law, ordinance,  rule or regulation
applicable to Acquirer,  HOVRS Merger Sub or any of their  Subsidiaries or their
properties  or assets  in the case of clause  (b),  except  for such  conflicts,
violations,  defaults,  rights of  termination,  cancellation or acceleration as
could not,  individually  or in the aggregate,  reasonably be expected to have a
Material   Adverse  Effect  on  Acquirer.   No  consent,   approval,   order  or
authorization  of or  registration,  declaration or filing with any

                                       45
<PAGE>

Governmental Entity is required by or with respect to Acquirer, HOVRS Merger Sub
or any of their  Subsidiaries  in connection  with the execution and delivery of
this Agreement by Acquirer or HOVRS Merger Sub, or the  consummation by Acquirer
and HOVRS Merger Sub of the transactions contemplated hereby, except for (a) the
filing of the  Certificate  of Merger as  provided in Section  2.2;  (b) filings
required  under  the  Exchange  Act;  (c)  filings   required  by  the  National
Association  of  Securities  Dealers  ("NASD");  (d) the filing  with the Nasdaq
Capital  Market of a  Notification  Form for Listing of  Additional  Shares with
respect to the shares of Acquirer  Common  Stock  issuable  in exchange  for the
HOVRS  Securities  in the Merger and upon  exercise  of options  under the HOVRS
Option  Plan or  otherwise  assumed  by  Acquirer;  (e) such  filings  as may be
required under  applicable  state securities laws and the securities laws of any
foreign country; and (f) such other consents, authorizations, filings, approvals
and  registrations  which,  if not  obtained or made,  could not  reasonably  be
expected to have a Material  Adverse Effect on Acquirer and could not reasonably
be expected to prevent,  or  materially  alter or delay any of the  transactions
contemplated by this Agreement.

      4.3.  Governmental  Authorization.  Acquirer  has obtained  each  federal,
state, county, local or foreign governmental consent, license, permit, grant, or
other  authorization  of a  Governmental  Entity (a) pursuant to which  Acquirer
currently  operates or holds any interest in any of its properties;  or (b) that
is required for the operation of Acquirer's  business or the holding of any such
interest  and all of such  authorizations  are in full force and  effect  except
where the failure to obtain or have any such authorizations could not reasonably
be expected to have a Material Adverse Effect on Acquirer.

      4.4. Financial Statements.

            (a)  Acquirer has  delivered or made  available to HOVRS the audited
financial  statements of Acquirer on a consolidated basis for each of the fiscal
years ended  December  31,  2004,  2005 and 2006,  respectively,  and  unaudited
financial  statements  of  Acquirer  on a  consolidated  basis as at and for the
six-month  period ended June 30, 2007  (collectively,  the  "Acquirer  Financial
Statements"). The Acquirer Financial Statements have been prepared in accordance
with  GAAP  (except  that the  unaudited  financial  statements  do not  contain
footnotes and are subject to normal recurring  year-end audit  adjustments,  the
effect of which  will  not,  individually  or in the  aggregate,  be  materially
adverse)  applied on a consistent  basis  throughout  the periods  presented and
consistent with each other. The Acquirer Financial Statements fairly present the
consolidated financial condition, operating results and cash flow of Acquirer as
of the dates, and for the periods, indicated therein, subject to normal year-end
audit  adjustments  and the absence of  footnotes  in the case of the  unaudited
Acquirer Financial Statements.

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

                                       46
<PAGE>

      4.5. Capital Structure.

            (a) At the close of  business  on the date  hereof,  the  authorized
capital  stock of Acquirer  consists of  200,000,000  shares of Acquirer  Common
Stock, of which there are 2,462,605 shares issued and outstanding, and 4,351,943
shares of Acquirer Preferred Stock, of which there are 290,135 shares issued and
outstanding.  All  outstanding  shares of  Acquirer  Common  Stock and  Acquirer
Preferred Stock have been duly  authorized,  validly issued,  fully paid and are
nonassessable and are free of any liens or encumbrances  other than any liens or
encumbrances created by or imposed upon the holders thereof, and are not subject
to preemptive rights or rights of first refusal created by statute,  the Charter
Documents of Acquirer or any agreement to which  Acquirer is a party or by which
it is bound.

            (b) As of the  close of  business  on the  date  hereof,  there  are
290,135  shares  of  Acquirer  Common  Stock  reserved  for  issuance  upon  the
conversion of the outstanding  Acquirer  Preferred  Stock. As of that same date,
there are 188,158 shares of Acquirer Common Stock reserved for issuance pursuant
to  Acquirer's  Stock  Option  Plans,  of which  83,191  shares  are  subject to
outstanding,  unexercised  options.  Section  4.5(b) of the Acquirer  Disclosure
Schedule lists every  outstanding  option to purchase  shares of Acquirer Common
Stock, and for each such option sets forth the name of the optionee,  the number
of shares of Acquirer  Common Stock subject to purchase upon the exercise of the
option, the applicable  exercise price per share and the shares vested as of the
date designated thereon.

            (c) Section 4.5(c) of the Acquirer  Disclosure Schedule sets forth a
list of each Subsidiary of Acquirer and its jurisdiction of organization. All of
the outstanding  shares of capital stock of each Subsidiary of Acquirer (i) have
been duly authorized, validly issued, fully paid and are nonassessable,  and are
not subject to preemptive  rights or rights of first refusal created by statute,
the Charter  Documents of any  Subsidiary  of Acquirer or any agreement to which
any  Subsidiary  of  Acquirer  is a party or by which it is bound,  and (ii) are
owned by Acquirer,  by another Subsidiary of Acquirer or by Acquirer and another
Subsidiary  of  Acquirer,  free  and  clear  of  all  pledges,  liens,  charges,
mortgages, encumbrances and security interests of any kind or nature whatsoever.

            (d) Except for the rights created pursuant to this Agreement and the
rights otherwise disclosed in this Section 4.5 or in Section 4.5 of the Acquirer
Disclosure  Schedule,  there  are no other  options,  warrants,  calls,  rights,
commitments  or agreements of any character to which  Acquirer or any Subsidiary
of Acquirer is a party or by which any of them is bound  obligating  any of them
to issue, deliver, sell, repurchase or redeem, or cause to be issued, delivered,
sold,  repurchased or redeemed,  any shares of their capital stock or obligating
Acquirer or any Subsidiary of Acquirer to grant, extend,  accelerate the vesting
of,  change  the price of, or  otherwise  amend or enter  into any such  option,
warrant,  call,  right,  commitment or agreement.  There are no other contracts,
commitments  or agreements  relating to voting,  purchase or sale of the capital
stock of Acquirer or any Subsidiary of Acquirer (a) between or among Acquirer or
any Subsidiary of Acquirer or any of their  stockholders;  and (b) to Acquirer's
knowledge, between or among any of Acquirer's stockholders.

      4.6. Absence of Certain Changes. Except as disclosed in Section 4.6 of the
Acquirer  Disclosure  Schedule,  since December 31, 2006 (the "Acquirer  Balance
Sheet  Date"),  Acquirer

                                       47
<PAGE>

has conducted its business in the ordinary course  consistent with past practice
and there has not  occurred (a) any change,  event or condition  (whether or not
covered by insurance)  that has resulted in, or could  reasonably be expected to
result in, a Material Adverse Effect on Acquirer;  (b) any acquisition,  sale or
transfer of any material asset of Acquirer other than in the ordinary  course of
business and consistent with past practice; (c) any change in accounting methods
or practices  (including any change in depreciation or amortization  policies or
rates) by Acquirer or any revaluation by Acquirer of any of its assets;  (d) any
declaration,  setting aside or payment of a dividend or other  distribution with
respect to the shares of Acquirer or any direct or indirect redemption, purchase
or other  acquisition by Acquirer of any of its shares of capital stock; (e) any
Acquirer Material Contract entered into by Acquirer,  other than in the ordinary
course of business  and as  provided  to HOVRS,  or any  material  amendment  or
termination  of, or default  under,  any  Acquirer  Material  Contract  to which
Acquirer is a party or by which it is bound;  (f) any amendment or change to the
Charter Documents of Acquirer or any of its Subsidiaries; (g) any increase in or
modification  of the  compensation  or benefits  payable or to become payable by
Acquirer to any of its directors or employees, other than in the ordinary course
of business  consistent with past practice;  or (h) any negotiation or agreement
by  Acquirer  to do any of the things  described  in the  preceding  clauses (a)
through  (g)  (other  than  negotiations  with  HOVRS  and  its  representatives
regarding the transactions contemplated by this Agreement).  Except as disclosed
in Section 4.6 of the Acquirer Disclosure Schedule, at the Effective Time, there
will be no accrued but unpaid dividends on shares of Acquirer's capital stock.

      4.7.  Absence  of  Undisclosed  Liabilities.   Acquirer  has  no  material
obligations or material  liabilities of any nature (matured or unmatured,  fixed
or contingent) other than (a) those set forth or adequately  provided for in the
consolidated  balance sheets of Acquirer as of Acquirer  Balance Sheet Date (the
"Acquirer Balance Sheet"); (b) those incurred in the ordinary course of business
and not required to be set forth in Acquirer Balance Sheet under GAAP; (c) those
incurred in the ordinary  course of business since  Acquirer  Balance Sheet Date
and consistent with past practice; and (d) those incurred in connection with the
execution of this Agreement.

      4.8.   Litigation.   Section  4.8  of  the  Acquirer  Disclosure  Schedule
identifies every private or governmental  action,  suit,  proceeding,  claim and
arbitration  and, to the  knowledge of Acquirer,  every  investigation,  that is
pending or, to the knowledge of Acquirer,  threatened,  before any  Governmental
Entity, foreign or domestic, against Acquirer or any of its properties or any of
its officers or directors (in their capacities as such).  There is no private or
governmental action, suit, proceeding, claim or arbitration or, to the knowledge
of  Acquirer,  any  investigation,  that is  pending  or,  to the  knowledge  of
Acquirer,  threatened,  before any  Governmental  Entity,  foreign or  domestic,
against  Acquirer or any of its  properties  or any of its officers or directors
(in their  capacities as such),  that,  individually or in the aggregate,  could
reasonably be expected to have a Material  Adverse Effect on Acquirer.  There is
no judgment, decree or order against Acquirer, or, to the knowledge of Acquirer,
any of its  directors  or officers  (in their  capacities  as such),  that could
prevent,   enjoin  or  materially   alter  or  delay  any  of  the  transactions
contemplated by this Agreement,  or that could  reasonably be expected to have a
Material Adverse Effect on Acquirer.

      4.9. Restrictions on Business Activities. There is no agreement, judgment,
injunction,  order or decree binding upon Acquirer that has or could  reasonably
be  expected  to have the effect of  prohibiting  or  materially  impairing  any
current or future business practice of Acquirer,

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<PAGE>

any  acquisition  of property by Acquirer or the conduct of business by Acquirer
as currently conducted by Acquirer.

      4.10. Intellectual Property.

            (a) Acquirer owns and has good and marketable title to, or possesses
legally  enforceable rights to use, all Intellectual  Property that is both used
in and material to the business of Acquirer as currently  conducted by Acquirer.
The  Intellectual  Property  owned  by and  licensed  to  Acquirer  collectively
constitutes  all of the  material  Intellectual  Property  necessary  to  enable
Acquirer to conduct its business as such business is currently  being  conducted
by Acquirer.

            (b)  For the  purposes  of this  Agreement,  "Acquirer  Intellectual
Property" means Intellectual  Property incorporated into any product of Acquirer
or otherwise  used in the business of Acquirer  (except "off the shelf" or other
software widely available through regular commercial  distribution channels at a
cost not  exceeding  Ten  Thousand  Dollars  ($10,000)  on  standard  terms  and
conditions,  as modified  for  Acquirer's  operations).  Section  4.10(b) of the
Acquirer Disclosure Schedule lists:

                  (i) the following Acquirer Intellectual Property to the extent
owned by  Acquirer:  (A) all Issued  Patents  and Patent  Applications,  (B) all
registered Trademarks and pending trademark  applications and (C) all registered
Copyrights, including the jurisdictions in which each such Intellectual Property
has been issued or registered or in which any such application for such issuance
and/or registration has been filed; and

                  (ii) the following agreements relating to each of the products
of Acquirer (the "Acquirer Products") or Acquirer Intellectual Property: all (A)
agreements  granting any right to distribute or sublicense a Acquirer Product on
any  exclusive  or  non-exclusive  basis;  (B) any  exclusive  or  non-exclusive
licenses of Intellectual Property to or from Acquirer (except "off the shelf" or
other software widely available through regular commercial distribution channels
at a cost not exceeding  Ten Thousand  Dollars  ($10,000) on standard  terms and
conditions,  as modified for Acquirer's operations);  (C) agreements pursuant to
which the amounts  actually paid or payable under firm  commitments  to Acquirer
are  Twenty-Five  Thousand  Dollars  ($25,000)  or more;  (D) joint  development
agreements;  (E) agreements pursuant to which Acquirer grants or has granted any
ownership  right to any Acquirer  Intellectual  Property owned by Acquirer;  (F)
orders of a court of competent  jurisdiction  relating to Acquirer  Intellectual
Property owned or used by Acquirer that are known by Acquirer; (G) any option to
purchase  or obtain a license to any  Acquirer  Intellectual  Property  owned by
Acquirer;  and (H) agreements  pursuant to which Acquirer  grants or has granted
any party any rights to access  source code or to use source code or object code
to create derivative works of Acquirer Products.

            (c) Section 4.10(c) of the Acquirer  Disclosure Schedule contains an
accurate list as of the date of this Agreement of all licenses,  sublicenses and
other agreements to which Acquirer is a party and pursuant to which (i) Acquirer
has authorized another party to use any Intellectual  Property owned by Acquirer
that is material to the business or (ii) to which  Acquirer is authorized to use
any  Intellectual  Property that is owned by any third party and material to the

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<PAGE>

business  of  Acquirer,  excluding  "off the  shelf"  or other  software  widely
available  through  regular  commercial  distribution  channels  at a  cost  not
exceeding  Ten  Thousand  Dollars  ($10,000)  on standard  terms and  conditions
("Third Party Acquirer Intellectual Property").

            (d) To the  knowledge of  Acquirer,  there is no  unauthorized  use,
disclosure,  infringement  or  misappropriation  of  any  Acquirer  Intellectual
Property owned by Acquirer by any third party,  including any employee or former
employee  of  Acquirer,  other than such  uses,  disclosures,  infringements  or
misappropriations as could not, individually or in the aggregate,  reasonably be
expected to have a Material  Adverse Effect on Acquirer.  Except as disclosed in
Section 4.10(c) of the Acquirer  Disclosure  Schedule,  Acquirer has not entered
into any  agreement  to  indemnify  any  other  Person  against  any  charge  of
infringement of any Intellectual Property, other than indemnification provisions
contained  in standard  sales or other  agreements  to end users  arising in the
ordinary course of business,  the forms of which have been delivered to HOVRS or
its counsel.  Except pursuant to agreements  disclosed in Section 4.10(c) of the
Acquirer  Disclosure  Schedule,  there are no royalties,  fees or other payments
payable  by  Acquirer  to any  party by reason of the  ownership,  use,  sale or
disposition of Third Party Acquirer Intellectual Property.

            (e)  Other  than with  respect  to  matters  which  have been  fully
resolved,  settled  and, if  applicable,  fully paid,  prior to the date hereof,
Acquirer has no knowledge of, and has not received  written notice asserting any
breach by Acquirer of any license,  sublicense  or other  agreement  relating to
Acquirer Intellectual  Property or Third Party Acquirer  Intellectual  Property.
Neither  the  execution,  delivery  or  performance  of  this  Agreement  or any
ancillary  agreement  contemplated  hereby nor the consummation of the Merger or
any of the transactions contemplated by this Agreement will contravene, conflict
with or result in any limitation on Acquirer's  right to own or use any Acquirer
Intellectual Property, including any Third Party Acquirer Intellectual Property.

            (f) To the  knowledge of Acquirer,  all Issued  Patents,  registered
Trademarks and registered Copyrights owned by Acquirer are valid and subsisting.
With respect to any Issued Patents owned by Acquirer, all maintenance and annual
fees have been fully paid. With respect to registered Trademarks,  all necessary
affidavits of use, renewals and/or documents  evidencing accurate chain of title
and  ownership are currently on file with the United States Patent and Trademark
Office.  Other  than with  respect to  matters  which have been fully  resolved,
settled, and, if applicable,  fully paid, prior to the date hereof, Acquirer has
no knowledge  of, and has not received any written  assertion  of, any actual or
alleged  infringement,  misappropriation  or  unlawful  use by  Acquirer  of any
Intellectual  Property  owned by any third  party,  and  there is no  proceeding
pending  or, to the  knowledge  of  Acquirer,  threatened  with  respect  to the
foregoing.  There is no  proceeding  pending or, to the  knowledge  of Acquirer,
threatened  with  respect to, nor has  Acquirer  received  any written  claim or
demand that challenges, the legality,  validity,  enforceability or ownership of
any item of Acquirer Intellectual  Property that is owned by Acquirer.  Acquirer
has not brought a  proceeding  alleging  infringement  of Acquirer  Intellectual
Property or breach of any license or agreement involving  Intellectual  Property
against any third party.

            (g) All  current  and  former  officers,  employees  and  vendors of
Acquirer,  to the extent  the duties of such  officers,  employees  and  vendors
primarily  involve the handling of

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<PAGE>

confidential  information of Acquirer or the creation of Intellectual  Property,
have executed and delivered to Acquirer an agreement regarding the protection of
proprietary  information  and the  assignment  to Acquirer  of any  Intellectual
Property arising from services performed for Acquirer by such persons,  the form
of which has been supplied to HOVRS.  To the knowledge of Acquirer,  no employee
of Acquirer is in violation  of any term  relating to  Intellectual  Property or
confidentiality  contained in any  employment  contract or any other contract or
agreement  relating to the  relationship of any such employee with Acquirer.  To
the knowledge of Acquirer, no current or former officer, director or employee of
Acquirer  has any right,  claim or interest in or with  respect to any  Acquirer
Intellectual Property owned by Acquirer.

            (h)  Acquirer  has  taken  commercially   reasonable   measures  and
precautions  designed to protect and maintain the  confidentiality  of all trade
secrets and proprietary  information of Acquirer  (except such trade secrets and
proprietary  information whose value would not be materially  impaired by public
disclosure).  All  disclosure  to a third  party of any trade  secrets  that are
material to the business of and owned by Acquirer has been pursuant to the terms
of a written  agreement  between Acquirer and such third party,  such agreements
designed to protect and maintain the confidentiality of all trade secrets.

            (i)  Except  as  set  forth  in  Section  4.10(i)  of  the  Acquirer
Disclosure  Schedule and except for any claims that have been resolved  prior to
the date hereof,  no product  liability claims have been communicated in writing
to or, to Acquirer's knowledge, threatened against Acquirer.

            (j) A complete  list of each of  Acquirer  Products  and  Acquirer's
proprietary  software  that is material to its business  ("Acquirer  Software"),
together with a brief  description  of each, is set forth in Section  4.10(j) of
the Acquirer Disclosure Schedule.

            (k) To the  knowledge  of  Acquirer,  Acquirer is not subject to any
proceeding or outstanding decree,  order,  judgment,  stipulation,  or agreement
restricting  in any  manner  the use,  transfer  or  licensing  of any  Acquirer
Intellectual Property owned by Acquirer,  or which may affect the validity,  use
or enforceability of such Acquirer Intellectual Property.

            (l) To the  knowledge  of Acquirer,  no Public  Software (as defined
below) forms a material  part of any  Acquirer  Products,  services  provided by
Acquirer or Acquirer Intellectual Property, and no Public Software was or is (A)
both used in connection  with, and material to, the  development of any Acquirer
Product,  Acquirer service or Acquirer  Intellectual Property owned by Acquirer,
or (B) in any material respect is incorporated into, in whole or in part, or has
been  distributed  with,  in whole or in part,  any Acquirer  Product,  Acquirer
service or Acquirer  Intellectual  Property  owned by Acquirer.  As used in this
Section  4.10(l),  "Public  Software"  means any software that  contains,  or is
derived  in any  manner  (in  whole  or in  part)  from,  any  software  that is
distributed as free software (as defined by the Free Software Foundation),  open
source software (e.g., Linux or software  distributed under any license approved
by the Open  Source  Initiative  as set  forth  www.opensource.org)  or  similar
licensing or distribution  models which requires the distribution of source code
to  licensees,  including  software  licensed  or  distributed  under any of the
following  licenses or distribution  models, or licenses or distribution  models
similar to any of the  following:  (i) GNU's  General  Public  License  (GPL) or
Lesser/Library  GPL (LGPL);  (ii) the Artistic License (e.g.,  PERL);  (iii) the
Mozilla

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<PAGE>

Public License;  (iv) the Netscape Public License;  (v) the Sun Community Source
License (SCSL);  (vi) the Sun Industry  Standards License (SISL);  (vii) the BSD
License; or (viii) the Apache License.

      4.11.  Interested  Party  Transactions.  Acquirer  is not  indebted to any
director,  officer,  employee  or agent of  Acquirer  (except for amounts due as
normal salaries and bonuses and in reimbursement of ordinary  expenses),  and no
such Person is indebted to Acquirer.  There have been no transactions during the
two-year  period ending on the date hereof that would require  disclosure  under
Item 404 of Regulation S-K under the Securities Act,  except those  transactions
described in the Acquirer SEC Documents.

      4.12.  Minute  Books.  The minute book of Acquirer  contains a  materially
complete and accurate  summary of all meetings of directors and  stockholders or
actions by written consent since the time of  incorporation  of Acquirer through
the date of this Agreement,  and reflects all  transactions  referred to in such
minutes accurately in all material respects.

      4.13.  Complete Copies of Materials.  All copies of documents delivered or
made  available  by Acquirer to HOVRS in  connection  with HOVRS' due  diligence
review of Acquirer have been true and complete copies of each such document.

      4.14.  Acquirer Material  Contracts.  All Acquirer Material  Contracts (as
defined  below in this Section  4.14) are listed in Section 4.14 of the Acquirer
Disclosure  Schedule.  With  respect to Acquirer  Material  Contracts:  (a) each
Acquirer Material Contract is legal, valid,  binding and enforceable and in full
force and effect with  respect to Acquirer,  and, to  Acquirer's  knowledge,  is
legal, valid, binding,  enforceable and in full force and effect with respect to
each other party  thereto,  in either case subject to the effect of  bankruptcy,
insolvency,  moratorium  or other  similar laws  affecting  the  enforcement  of
creditors' rights generally and except as the availability of equitable remedies
may be limited by general  principles  of  equity;  (b) each  Acquirer  Material
Contract will continue to be legal,  valid,  binding and enforceable and in full
force and effect immediately following the Effective Time in accordance with its
terms as in  effect  prior to the  Effective  Time,  subject  to the  effect  of
bankruptcy,   insolvency,   moratorium  or  other  similar  laws  affecting  the
enforcement of creditors'  rights  generally and except as the  availability  of
equitable  remedies  may be  limited by general  principles  of equity;  and (c)
neither Acquirer nor, to Acquirer's  knowledge,  any other party is in breach or
default,  and no event  has  occurred  that with  notice or lapse of time  would
constitute a breach or default by Acquirer or, to Acquirer's  knowledge,  by any
such other party, or permit  termination,  modification or  acceleration,  under
such  Acquirer  Material  Contract,  subject  to such  exceptions  as could not,
individually  or in the  aggregate,  reasonably  be  expected to have a Material
Adverse  Effect  on  Acquirer.  Acquirer  is not a party to any  oral  contract,
agreement or other arrangement. "Acquirer Material Contract" means any contract,
agreement or commitment to which Acquirer is a party (a) with expected  receipts
or  expenditures  in excess  of  Twenty-Five  Thousand  Dollars  ($25,000);  (b)
required to be listed pursuant to Section 4.10(c) or Section 4.22; (c) requiring
Acquirer to indemnify any party; (d) granting any exclusive rights to any party;
(e) evidencing indebtedness for borrowed or loaned money of Twenty-Five Thousand
Dollars ($25,000) or more,  including  guarantees of such  indebtedness;  or (f)
that could  reasonably be expected to have a Material Adverse Effect on Acquirer
if  breached by Acquirer in such a manner as would (I) permit any other party to
cancel or terminate the same (with or without  notice or passage of time);  (II)
provide a basis for any

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<PAGE>

other party to claim money damages (either individually or in the aggregate with
all other such claims under that contract) from Acquirer;  or (III) give rise to
a right of  acceleration  of any  material  obligation  or loss of any  material
benefit under such Acquirer Material Contract.

      4.15.  Inventory.  The  inventories  shown on  Acquirer  Balance  Sheet or
thereafter  acquired by Acquirer,  were acquired and  maintained in the ordinary
course of business,  are of good and merchantable  quality, and consist of items
of a quantity and quality usable or salable in the ordinary  course of business.
Since  Acquirer  Balance  Sheet  Date,   Acquirer  has  continued  to  replenish
inventories in a normal and customary manner consistent with past practices. The
values at which  inventories are carried reflect the inventory  valuation policy
of Acquirer,  which is consistent  with its past practice and in accordance with
GAAP applied on a consistent basis. Acquirer is not under any material liability
or  obligation  with  respect  to the  return  of any item of  inventory  in the
possession of wholesalers,  retailers or other customers. Since Acquirer Balance
Sheet  Date,  adequate  provision  has been made on the books of Acquirer in the
ordinary  course of business in  accordance  with GAAP  applied on a  consistent
basis to provide for all material slow-moving,  obsolete or unusable inventories
to their  estimated  useful or scrap  values,  and such  inventory  reserves are
adequate to provide for such  slow-moving,  obsolete or unusable  inventory  and
inventory shrinkage.

      4.16. Accounts Receivable.  Subject to any reserves set forth therein, the
accounts  receivable  shown on  Acquirer  Financial  Statements  are  valid  and
genuine,  have  arisen  solely out of bona fide sales and  deliveries  of goods,
performance of services,  and other business transactions in the ordinary course
of business  consistent with past practices in each case with persons other than
affiliates, are not subject to any prior assignment,  lien or security interest,
and to  Acquirer's  knowledge  are not  subject to valid  defenses,  set-offs or
counter claims. The accounts receivable are collectible in accordance with their
terms at their  recorded  amounts,  subject  only to the  reserve  for  doubtful
accounts on the Acquirer Financial Statements.

      4.17.  Customers and  Suppliers.  As of the date hereof,  no customer that
individually  accounted  for more than five  percent  (5%) of  Acquirer's  gross
revenues during the 12-month period preceding the date hereof and no supplier of
Acquirer  that  individually  accounted  for  more  than  five  percent  (5%) of
Acquirer's  purchases  during the 12-month period  preceding the date hereof has
canceled or  otherwise  terminated,  or made any  written  threat to Acquirer to
cancel or otherwise  terminate its relationship with Acquirer or has at any time
on or after Acquirer  Balance Sheet Date,  decreased  materially its services or
supplies  to  Acquirer  in the case of any such  supplier,  or its  usage of the
services or products of Acquirer in the case of such customer, and to Acquirer's
knowledge no such supplier or customer has indicated either orally or in writing
that it intends to cancel or otherwise  terminate its relationship with Acquirer
or to decrease  materially  its services or supplies to Acquirer or its usage of
the  services or  products of  Acquirer,  as the case may be.  Acquirer  has not
knowingly breached any agreement with, or engaged in any fraudulent conduct with
respect to, any customer or supplier of Acquirer,  so as to provide a benefit to
Acquirer that was not intended by the parties.

      4.18.  Employees and Consultants.  Section 4.18 of the Acquirer Disclosure
Schedule  contains  a list of the  names  of all  employees  (including  without
limitation  part-time  employees and  temporary  employees),  leased  employees,
independent  contractors  and  consultants  of  Acquirer,  together  with  their
respective  salaries  or wages,  other  compensation,  dates of

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employment and positions.  Section 4.18 of the Acquirer Disclosure Schedule also
describes all severance benefits to which any Acquirer employee is or may become
entitled pursuant to any agreement between Acquirer and such employee.

      4.19. Title to Property.  Acquirer has good and marketable title to all of
its properties, interests in properties and assets, real and personal, reflected
in Acquirer  Balance Sheet or acquired after Acquirer Balance Sheet Date (except
properties,  interests in  properties  and assets sold or otherwise  disposed of
since Acquirer  Balance Sheet Date in the ordinary course of business),  or with
respect to leased properties and assets, valid leasehold interests therein, free
and clear of all mortgages,  liens, pledges, charges or encumbrances of any kind
or character,  except (a) the lien of current taxes not yet due and payable; (b)
such  imperfections  of  title,  liens  and  easements  as do not and  will  not
materially  detract from or  interfere  with the use of the  properties  subject
thereto or affected thereby, or otherwise  materially impair business operations
involving such properties; (c) liens securing debt that is reflected on Acquirer
Balance Sheet or listed in Section 4.19 of the Acquirer Disclosure Schedule; and
(d) such other mortgages,  liens, pledges, charges or encumbrances as could not,
individually  or in the  aggregate,  reasonably  be  expected to have a Material
Adverse Effect on Acquirer. The plants,  property and equipment of Acquirer that
are used in the operations of Acquirer's  business are in all material  respects
in good  operating  condition and repair,  subject to normal wear and tear.  All
properties used in the operations of Acquirer are reflected in Acquirer  Balance
Sheet to the extent  required by GAAP.  All leases to which  Acquirer is a party
are in full  force  and  effect  and  are  valid,  binding  and  enforceable  in
accordance with their respective  terms,  except as such  enforceability  may be
limited by bankruptcy, insolvency, moratorium or other similar laws affecting or
relating to  creditors'  rights  generally;  and general  principles  of equity,
regardless  of whether  asserted in a proceeding  in equity or at law.  True and
correct copies of all such leases have been provided to Acquirer.  Acquirer owns
no real property.

      4.20. Environmental Matters. To the knowledge of Acquirer, Acquirer is and
has been in  material  compliance  with all  Environmental  Laws  applicable  to
Acquirer and relating to the properties or facilities  used,  leased or occupied
by Acquirer at any time (collectively,  "Acquirer's  Facilities" such properties
or facilities  currently used, leased or occupied by Acquirer are defined herein
as "Acquirer's Current Facilities"),  and no discharge,  emission, release, leak
or spill of Hazardous  Materials  has occurred at any of Acquirer `s  Facilities
during  Acquirer's  occupancy  thereof that could reasonably be expected to give
rise to a material liability of Acquirer under  Environmental  Laws. To Acquirer
`s knowledge, (i) there are no Hazardous Materials (including without limitation
asbestos) present in the surface waters, structures, groundwaters or soils of or
beneath  any  of  Acquirer's   Current   Facilities   in  a  condition,   or  in
concentrations  or amounts,  that could reasonably be expected to give rise to a
material  liability  of  Acquirer,  (ii)  there  neither  are nor have  been any
aboveground or underground  storage tanks for Hazardous  Materials at Acquirer's
Current  Facilities  except as are  operated  and  maintained,  or  removed,  in
material  compliance with applicable  Environmental  Laws, and (iii) no Acquirer
employee or other  Person has  asserted in writing  that  Acquirer is liable for
alleged  injury or illness  resulting  from an alleged  exposure  to a Hazardous
Material.  Except  as set  forth  in  Section  4.20 of the  Acquirer  Disclosure
Schedule,   no  civil,   criminal  or  administrative   action,   proceeding  or
investigation  is  pending  against  Acquirer,  or, to  Acquirer  `s  knowledge,
threatened  against  Acquirer,  alleging a material  liability of Acquirer  with
respect to Hazardous Materials or a material violation of Environmental Laws.

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<PAGE>

      4.21. Taxes. Acquirer makes the following  representations with respect to
Taxes:

            (a)  Acquirer  has  prepared  and timely  filed (or will prepare and
timely  file) all Tax Returns  required  to be filed by Acquirer  for any period
ending on or before the Closing Date. All Tax Returns filed by Acquirer are true
and correct in all material  respects and have been completed in accordance with
Applicable Law, and all material Taxes shown to be due on such Tax Returns,  and
other  material  Taxes that are due for which no Tax Returns are  required to be
filed, have been timely paid. To the extent Taxes are not due, adequate reserves
have been  established  on the  Acquirer  Balance  Sheet with respect to accrued
Taxes up to the Acquirer  Balance Sheet Date in accordance  with GAAP as applied
by Acquirer on a consistent basis with prior periods.  Acquirer has no knowledge
of any basis for the  assertion of a liability  for unpaid Taxes with respect to
accrued Taxes up to the Acquirer  Balance Sheet Date that are not established on
the Acquirer  Balance Sheet.  Acquirer has no knowledge that it has incurred any
liability  for Taxes  after the  Acquirer  Balance  Sheet Date other than in the
ordinary course of business that may be material. Acquirer has delivered or made
available  to HOVRS true and  correct  copies of all income  and  franchise  Tax
Returns,  closing agreements,  examination reports or other similar reports, and
statements of deficiencies filed, assessed against or agreed to by, or on behalf
of, Acquirer since December 31, 2003.

            (b)  There are no audits by any  taxing  authority  pending  against
Acquirer or any predecessor  entity and Acquirer has not received written notice
from any taxing  authority  that it is conducting or intends to conduct an audit
or investigation. Acquirer has not waived or extended any statute of limitations
in  respect  of Taxes or Tax  Returns  or agreed to any  extension  of time with
respect to a Tax  assessment,  reassessment,  deficiency  or with respect to the
payment  of any Taxes.  Acquirer  is not a party to any power of  attorney  with
respect to a Tax matter that is  currently  in force or  otherwise  bound by any
private  letter  ruling  of the IRS or  comparable  rulings  issued by any other
taxing authority.

            (c) No claims  have been made by a taxing  authority  in  writing to
Acquirer  in a  jurisdiction  where  Acquirer  does not file  Tax  Returns  that
Acquirer  is or may be subject to taxation  by that  jurisdiction.  No issue has
been raised by a taxing  authority in writing to Acquirer in any current or most
recent  examination  which,  by application  of the same or similar  principles,
would  reasonably  be  expected to affect the Tax  treatment  of Acquirer in any
taxable period (or portion thereof) ending after the Closing Date.

            (d) Acquirer  does not have (i) any liability for the payment of any
Taxes as a result of being a member of an  affiliated,  consolidated,  combined,
unitary or similar group or as a result of transferor or successor  liability or
by operation of  Applicable  Law, and (ii) any  liability for the payment of any
amounts as a result of being a party to, or bound by, any tax sharing  agreement
or as a result of any  express  or implied  obligation  to  indemnify  any other
Person with respect to Taxes.

            (e)  Acquirer  has  disclosed  to HOVRS (i) any Tax  exemption,  Tax
holiday or other Tax-sparing  arrangement that Acquirer has in any jurisdiction,
including the nature,  amount and lengths of such Tax exemption,  Tax holiday or
other Tax-sparing arrangement;  and (ii) any expatriate tax programs or policies
affecting Acquirer.  Acquirer is in compliance in all material respects with all
terms and  conditions  required to maintain such Tax  exemption,  Tax

                                       55
<PAGE>

holiday or other Tax-sparing arrangement or order of any governmental entity and
the  consummation  of the  transactions  contemplated  hereby  will not have any
adverse  effect on the  continuing  validity and  effectiveness  of any such Tax
exemption, Tax holiday or other Tax-sparing arrangement or order.

            (f) Acquirer is not, and has not been during the  applicable  period
specified in Section 897(c)(1)(A)(ii) of the Code, a United States real property
holding corporation within the meaning of section 897(c)(2) of the Code.

            (g)  Acquirer  is not a party to any  contract,  agreement,  plan or
arrangement,  including  but not limited to the  provisions  of this  Agreement,
covering  any  employee or former  employee of Acquirer  that,  individually  or
collectively,  could give rise to the  payment  of any amount  that would not be
deductible  pursuant  to  Sections  280G of the Code by  Acquirer  or any of its
Subsidiaries,  or that  would be  subject  to an excise Tax by reason of Section
4999 of the Code.

            (h) Section 4.21(h) of the Acquirer  Disclosure  Schedule contains a
list enumerating each jurisdiction in which Acquirer is required to pay Taxes or
file Tax Returns and  specifying the type of Taxes paid and Tax Returns filed in
that jurisdiction.

            (i)  Acquirer (i) has  complied in all  material  respects  with all
Applicable Laws,  rules and regulations  relating to the payment and withholding
of Taxes, (ii) has timely and properly paid over to the applicable  governmental
authorities all amounts  required to be so withheld from all payments made by or
on behalf  of  Acquirer  (including,  but not  limited  to,  employee  wages and
payments to independent  contractors)  and (iii) is not liable for any Taxes for
failure to comply with such laws, rules and regulations.

            (j) Acquirer has not  distributed the stock of any  corporation,  or
had its stock distributed by another person, in a transaction that was purported
or intended to be governed in whole or in part by Section 355 of the Code.

            (k) No property of Acquirer  (i) is tax exempt use  property  within
the meaning of Section 168(h) or Section 470(c)(2) of the Code, (ii) directly or
indirectly secures any debt the interest on which is exempt under Section 103(a)
of the Code or (iii) is  required  to be  treated  as being  owned by any Person
(other than  Acquirer)  pursuant to the  provisions of Section  168(f)(8) of the
Internal Revenue Code of 1954, as amended,  and in effect immediately before the
Tax Reform Act of 1986.

            (l) Acquirer has  disclosed on its U.S.  federal  income tax returns
all positions taken therein that could give rise to a substantial understatement
of federal  income Tax within the meaning of Section 6662 of the Code.  Acquirer
has not engaged in a reportable transaction described in Section 1.6011-4 of the
Treasury Regulations.

      4.22. Employee Benefit Plans.

            (a) Section 4.22(a) of the Acquirer  Disclosure  Schedule contains a
complete and accurate list of each plan, program,  policy,  practice,  contract,
agreement  or  other   arrangement   providing  for  employment,   compensation,
retirement,  deferred compensation,  loans,

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<PAGE>

severance,  separation,  relocation,  repatriation,  expatriation,  visas,  work
permits,  termination pay, performance awards, bonus,  incentive,  stock option,
stock  purchase,   stock  bonus,   phantom  stock,  stock  appreciation   right,
supplemental retirement,  fringe benefits, cafeteria benefits or other benefits,
whether  written or  unwritten,  including  without  limitation  each  "employee
benefit  plan"  within the meaning of Section  3(3) of the  Employee  Retirement
Income  Security  Act  of  1974,  as  amended  ("ERISA"),  which  is  sponsored,
maintained,  contributed  to, or required to be  contributed to by Acquirer and,
with  respect to any such plans which are subject to Code  Section  401(a),  any
trade or  business  (whether  or not  incorporated)  that is treated as a single
employer with Acquirer within the meaning of Section 414(b),  (c), (m) or (o) of
the Code, (an "ERISA  Affiliate")  for the benefit of any Person who performs or
who has performed services for Acquirer or with respect to which Acquirer or any
ERISA  Affiliate has or may have any  liability  (including  without  limitation
contingent  liability)  or  obligation  (collectively,  the  "Acquirer  Employee
Plans").

            (b)  Documents.  Acquirer has  furnished or made  available to HOVRS
true and complete  copies of documents  embodying each of the existing  Acquirer
Employee Plans and related plan documents,  including  without  limitation trust
documents,  group annuity  contracts,  plan  amendments,  insurance  policies or
contracts,  participant  agreements,  employee booklets,  administrative service
agreements,  summary plan  descriptions,  summaries  of material  modifications,
compliance and  nondiscrimination  tests for the last three plan years, standard
COBRA forms and related notices,  registration  statements and prospectuses and,
to the extent  still in its  possession,  any material  employee  communications
relating thereto. With respect to each Acquirer Employee Plan that is subject to
ERISA  reporting  requirements,  Acquirer has provided  HOVRS with copies of the
Form  5500  reports  filed  for the last  three  (3) plan  years.  Acquirer  has
furnished HOVRS with the most recent Internal  Revenue Service  determination or
opinion  letter issued with respect to each such Acquirer  Employee Plan, and to
Acquirer's knowledge nothing has occurred since the issuance of each such letter
that could reasonably be expected to cause the loss of the tax-qualified  status
of any Acquirer Employee Plan subject to Code Section 401(a).

            (c)   Compliance.   (i)  Each   Acquirer   Employee  Plan  has  been
administered   in  accordance   with  its  terms  and  in  compliance  with  the
requirements  prescribed  by  any  and  all  statutes,   rules  and  regulations
(including  ERISA and the Code),  except as could not  reasonably be expected to
have,  individually or in the aggregate,  a Material Adverse Effect on Acquirer;
and Acquirer and each ERISA  Affiliate have  performed all material  obligations
required to be performed by them under,  are not in material  respect in default
under or violation of and have no knowledge of any material default or violation
by any  other  party to,  any of  Acquirer  Employee  Plans;  (ii) any  Acquirer
Employee  Plan  intended to be  qualified  under  Section  401(a) of the Code is
either subject to a favorable  determination  letter or opinion letter issued by
the  Internal  Revenue  Service  as to its  qualified  status  under  the  Code,
including all currently effective  amendments to the Code, or has time remaining
to apply under  applicable  Treasury  Regulations  or Internal  Revenue  Service
pronouncements  for a determination or opinion letter and to make any amendments
necessary to obtain a favorable  determination or opinion letter;  (iii) none of
Acquirer  Employee Plans promises or provides  retiree  medical or other retiree
welfare  benefits  to any Person  (except to the extent  required to comply with
COBRA or any similar state law);  (iv) there has been no non-exempt  "prohibited
transaction," as such term is defined in Section 406 of ERISA or Section 4975 of
the Code,  with respect to any Acquirer  Employee  Plan;

                                       57
<PAGE>

(v) none of  Acquirer  or any ERISA  Affiliate  is subject to any  liability  or
penalty  under  Sections  4976 through 4980 of the Code or Title I of ERISA with
respect to any Acquirer Employee Plan; (vi) all material  contributions required
to be made by Acquirer or any ERISA Affiliate to any Acquirer Employee Plan have
been paid or accrued in accordance  with  Applicable  Law; (vii) with respect to
each Acquirer Employee Plan, no "reportable event" within the meaning of Section
4043 of ERISA  (excluding  any such event for which the  thirty  (30) day notice
requirement  has been waived under the regulations to Section 4043 of ERISA) nor
any event described in Section 4062, 4063 or 4041 or ERISA has occurred;  (viii)
each  Acquirer  Employee  Plan  subject to ERISA has  prepared in good faith and
timely filed all requisite  governmental reports, which were true and correct as
of the date filed,  and has properly and timely filed and  distributed or posted
all notices and reports to employees required to be filed, distributed or posted
with respect to each such Acquirer Employee Plan except where such failure would
result in a material liability; (ix) no suit, administrative proceeding,  action
or other  litigation  has been  brought,  or to the  knowledge  of  Acquirer  is
threatened,  against  or  with  respect  to any  such  Acquirer  Employee  Plan,
including any audit or inquiry by the IRS or United States  Department of Labor;
(x) except as contemplated  by this  Agreement,  there has been no amendment to,
written  interpretation  or announcement by Acquirer or any ERISA Affiliate that
would materially  increase the expense of maintaining any Acquirer Employee Plan
above the  level of  expense  incurred  with  respect  to that Plan for the most
recent  fiscal  year  included  in Acquirer  Financial  Statements;  and (xi) no
Acquirer Employee Plan is required to comply with any foreign law.

            (d) No Title IV or  Multiemployer  Plan.  Neither  Acquirer  nor any
ERISA Affiliate has ever maintained,  established,  sponsored,  participated in,
contributed  to, or is obligated  to  contribute  to, or otherwise  incurred any
obligation or liability (including without limitation any contingent  liability)
under any "multiemployer  plan" (as defined in Section 3(37) of ERISA) or to any
"pension  plan" (as  defined  in Section  3(2) of ERISA)  subject to Title IV of
ERISA or Section 412 of the Code.  None of Acquirer or any ERISA  Affiliate  has
any actual or potential  withdrawal  liability (including without limitation any
contingent  liability)  for any  complete or partial  withdrawal  (as defined in
Sections 4203 and 4205 of ERISA) from any multiemployer plan.

            (e) COBRA, FMLA, HIPAA, Cancer Rights. With respect to each Acquirer
Employee  Plan,  Acquirer  has  complied  with (i) the  applicable  health  care
continuation  and  notice   provisions  of  the   Consolidated   Omnibus  Budget
Reconciliation Act of 1985 ("COBRA") and the regulations thereunder or any state
law  governing  health  care  coverage  extension  or  continuation;   (ii)  the
applicable  requirements  of the  Family and  Medical  Leave Act of 1993 and the
regulations  thereunder;   (iii)  the  applicable  requirements  of  the  Health
Insurance  Portability and  Accountability  Act of 1996 ("HIPAA");  and (iv) the
applicable  requirements of the Cancer Rights Act of 1998,  except to the extent
that such failure to comply could not reasonably be expected, individually or in
the aggregate,  to have a Material  Adverse Effect on Acquirer.  Acquirer has no
material unsatisfied obligations to any employees, former employees or qualified
beneficiaries  pursuant to COBRA,  HIPAA or any state law governing  health care
coverage extension or continuation.

            (f) Effect of  Transaction.  The  consummation  of the  transactions
contemplated  by this Agreement will not either alone or in conjunction  with an
individual's

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<PAGE>

termination  of employment or service or a change in the terms and conditions of
employment  or service  (i)  entitle  any  current or former  employee  or other
service provider of Acquirer or any ERISA Affiliate to severance benefits or any
other payment (including without limitation  unemployment  compensation,  golden
parachute,  bonus or  benefits  under any  Acquirer  Employee  Plan),  except as
expressly provided in this Agreement;  or (ii) accelerate the time of payment or
vesting of any such benefits or increase the amount of compensation due any such
employee or service  provider.  No benefit payable or that may become payable by
Acquirer  pursuant to any  Acquirer  Employee  Plan or as a result of or arising
under this Agreement shall constitute an "excess parachute  payment" (as defined
in Section  280G(b)(1) of the Code)  subject to the  imposition of an excise Tax
under Section 4999 of the Code or the deduction for which would be disallowed by
reason of Section 280G of the Code. Each Acquirer  Employee Plan can be amended,
terminated or otherwise discontinued after the Effective Time in accordance with
its terms,  without  material  liability  to  Acquirer  or  Acquirer  other than
ordinary administration expenses typically incurred in a termination event.

      4.23. Employee Matters. Acquirer is in compliance in all material respects
with  all  currently  Applicable  Laws  and  regulations  respecting  terms  and
conditions of employment,  including without  limitation  applicant and employee
background  checking,  immigration laws,  discrimination  laws,  verification of
employment  eligibility,  employee  leave  laws,  classification  of  workers as
employees and  independent  contractors,  wage and hour laws,  and  occupational
safety and health laws, except for such  noncompliance that could not reasonably
be expected to have, individually or in the aggregate, a Material Adverse Effect
on  Acquirer.  Except as  specified  in Section 4.8 of the  Acquirer  Disclosure
Schedule, as of the date of this Agreement, there are no proceedings pending or,
to Acquirer's knowledge, reasonably expected or threatened, between Acquirer, on
the one hand,  and any or all of its current or former  employees,  on the other
hand, which proceedings could reasonably be expected to have, a Material Adverse
Effect on  Acquirer,  including  without  limitation  any  claims  for actual or
alleged harassment or discrimination  based on race,  national origin, age, sex,
sexual orientation, religion, disability, or similar tortious conduct, breach of
contract, wrongful termination,  defamation, intentional or negligent infliction
of emotional distress, interference with contract or interference with actual or
prospective  economic  disadvantage.  Acquirer is not a party to any  collective
bargaining  agreement or other labor union  contract,  nor does Acquirer know of
any activities or  proceedings of any labor union to organize its employees.  To
Acquirer's  knowledge,  Acquirer  has  provided  all  employees  with all wages,
benefits,  relocation benefits, stock options,  bonuses and incentives,  and all
other  compensation  that  became  due  and  payable  through  the  date of this
Agreement.  Acquirer represents that it or the Surviving  Corporation intends to
employ all or  substantially  all of HOVR's  employees  following  the Effective
Time. Accordingly, no "mass layoff", "plant closing" or similar event as defined
by the Worker  Adjustment and Notification Act (29 U.S.C. ss. 2101 et seq.) with
respect to Acquirer  has  occurred  nor is expected to occur as a result of this
Agreement.

      4.24. Insurance.  Acquirer has policies of insurance and bonds of the type
and in amounts  customarily  carried by persons conducting  businesses or owning
assets  similar to those of Acquirer.  There is no material  claim pending under
any of such policies or bonds as to which coverage has been denied,  disputed or
to the knowledge of Acquirer  questioned by the underwriters of such policies or
bonds.  All premiums due and payable under all such policies and bonds have been
paid and Acquirer is otherwise in compliance  in all material  respects with

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<PAGE>

the  terms  of  such  policies  and  bonds.  Acquirer  has no  knowledge  of any
threatened  termination of, or material premium increase with respect to, any of
such policies.

      4.25.  Compliance  With  Laws.  Acquirer  has  complied  with,  is  not in
violation of and has not received any written  notices of violation with respect
to, any federal, state, local or foreign statute, law or regulation with respect
to the conduct of its  business,  or the ownership or operation of its business,
except for such  violations  or  failures to comply as could not  reasonably  be
expected to have a Material Adverse Effect on Acquirer.

      4.26.  Brokers' and Finders'  Fee.  Except as set forth in Section 4.26 to
the Acquirer Disclosure Schedule,  Acquirer has not entered into any arrangement
or agreement with any broker, finder or investment banker that would be entitled
to brokerage or finders' fees or agents' commissions or investment bankers' fees
or any similar  charges  from  Acquirer  in  connection  with the  Merger,  this
Agreement or any transaction contemplated hereby.

      4.27. Privacy Policies and Web Site Terms and Conditions.

            (a) For purposes of this Section 4.27:

                  (i) "Acquirer  Sites" means all of Acquirer's  public sites on
the World Wide Web; and

                  (ii) "Acquirer Privacy  Statements" means,  collectively,  any
and all of Acquirer's  privacy policies published on Acquirer Sites or otherwise
made publicly available by Acquirer regarding the collection, retention, use and
distribution  of the personal  information of  individuals,  including,  without
limitation, from visitors of any of Acquirer Sites ("Acquirer Individuals").

            (b) Acquirer is in material  compliance  with (i)  Acquirer  Privacy
Statements as applicable to any given set of personal  information  collected by
Acquirer from Acquirer  Individuals;  and (ii) all  applicable  privacy laws and
regulations regarding the collection,  retention, use and disclosure of personal
information.

            (c) Acquirer  has not  received any written  notice of any claims or
controversies  regarding  Acquirer  Privacy  Statements  or  the  implementation
thereof.

      4.28. International Trade Matters. Acquirer is, and at all times has been,
in material compliance with and has not been and is not in material violation of
any  International  Trade  Law,  including  but not  limited  to,  all  laws and
regulations  related  to the import and  export of  commodities,  software,  and
technology  from and into the United States,  and the payment of required duties
and tariffs in connection  with same.  Acquirer has no basis to expect,  nor has
any of them or any other Person for whose  conduct they are or may be held to be
responsible  received,   any  actual  or  threatened  order,  notice,  or  other
communication from any governmental body of any actual or potential violation or
failure to comply with any International Trade Law.

      4.29. Proxy Statement and Information  Statement.  None of the information
to be  supplied  by  Acquirer  or any  of  its  accountants,  counsel  or  other
authorized  representatives  for inclusion in the Preliminary Proxy Statement or
the HOVRS Information  Statement will, at the

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<PAGE>

time of the mailing thereof to the HOVRS  Stockholders,  or for inclusion in the
Proxy Statement will, at the time of the mailing thereof to the  stockholders of
Acquirer  or at the time of the  meeting of the  stockholders  of Acquirer to be
held in connection with the Merger,  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 light of the circumstances
under which they are made, not misleading,  it being  understood and agreed that
no  representation  or  warranty  is  made  by  Acquirer  with  respect  to  any
information  supplied by HOVRS or its  accountants,  counsel or other authorized
representatives.  If at any time  prior to the  Effective  Time any  event  with
respect to Acquirer or any of its  Subsidiaries,  or any of their  officers  and
directors,  shall occur which is or should be described in an amendment of, or a
supplement  to, the Proxy  Statement,  such event shall be so described  and the
presentation  in such  amendment  or  supplement  of such  information  will not
contain any statement which, at the time and in light of the circumstances under
which it is made,  is false or  misleading  in any material  respect or omits to
state any material fact  required to be stated  therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not false or misleading.  The Proxy  Statement will comply in all material
respects with all Applicable Laws, including the provisions of the Exchange Act.

      4.30. Board Approval.  The board of directors of Acquirer,  by resolutions
duly adopted at a meeting duly called and held and not subsequently rescinded or
modified  in any  way,  has duly  (i)  approved  this  Agreement  and the  other
documents  contemplated  hereunder,  together  with  the  Merger  and the  other
transactions  contemplated hereunder, and (ii) recommended that the stockholders
of Acquirer  approve the Merger,  the  issuance  of the  Acquirer  Common  Stock
pursuant to this Agreement and such other matters as shall be required by Nasdaq
in connection with the consummation of the Merger.

      4.31. SEC Documents.

            (a) Acquirer has timely filed each statement,  report,  registration
statement (with the prospectus in the form required to be filed pursuant to Rule
424(b) of the Securities  Act),  definitive  proxy  statement,  and other filing
required to be filed with the SEC by Acquirer, and, prior to the Effective Time,
Acquirer will file any additional documents required to be filed with the SEC by
Acquirer prior to the Effective Time (such documents filed by the Acquirer since
January 1, 2004,  collectively,  the  "Acquirer  SEC  Documents").  In addition,
Acquirer has made  available to HOVRS all exhibits to the Acquirer SEC Documents
filed  prior to the date  hereof  that are (a)  requested  by HOVRS  and (b) not
available in complete form through EDGAR ("Requested Confidential Exhibits") and
will promptly make available to HOVRS all Requested Confidential Exhibits to any
Acquirer SEC Documents filed prior to the Effective Time. All documents required
to be filed as exhibits  to Acquirer  SEC  Documents  have been so filed.  As of
their  respective  filing  dates,  the  Acquirer SEC  Documents  complied in all
material  respects with the  requirements of the Exchange Act and the Securities
Act and none of the Acquirer SEC Documents  contained any untrue  statement of a
material fact or omitted to state a material fact required to be stated  therein
or necessary to make the statements made therein,  in light of the circumstances
in which they were made,  not  misleading,  except to the extent  corrected by a
subsequently filed Acquirer SEC Document prior to the date hereof.

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<PAGE>

            (b) The  financial  statements  of  Acquirer,  including  the  notes
thereto,  included in the Acquirer SEC  Documents  (the  "Acquirer SEC Financial
Statements"),  complied  as to form in all  material  respects  with  applicable
accounting  requirements and with the published rules and regulations of the SEC
with respect  thereto as of their  respective  dates,  and have been prepared in
accordance  with GAAP  applied  on a basis  consistent  throughout  the  periods
indicated  and  consistent  with each other  (except as may be  indicated in the
notes  thereto or, in the case of  unaudited  statements  included in  quarterly
reports on Form 10-Q,  as permitted  by Form 10-Q of the SEC).  The Acquirer SEC
Financial  Statements  fairly  present  the  consolidated  financial  condition,
operating  results and cash flow of Acquirer and its  Subsidiaries  at the dates
and during the periods  presented  therein  (subject,  in the case of  unaudited
statements, to normal, recurring year-end adjustments). There has been no change
in Acquirer accounting policies except as described in the notes to the Acquirer
SEC Financial Statements.

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

      4.33. HOVRS Merger Sub. HOVRS Merger Sub is a direct,  wholly-owned entity
of Acquirer.  HOVRS Merger Sub was formed  solely for the purpose of engaging in
the transaction contemplated by this Agreement, has engaged in no other business
activities  and has no material  assets or  liabilities  and has  conducted  its
operations only as expressly contemplated hereby. Acquirer owns beneficially and
of record all  outstanding  capital  stock of HOVRS Merger Sub free and clear of
any liens and no other Person  holds any capital  stock of HOVRS Merger Sub, nor
has any rights to acquire any interest in HOVRS Merger Sub.

      4.34.  No  Other  Representations.  Except  for  the  representations  and
warranties  contained in this Section 4 (as modified by the Acquirer  Disclosure
Schedule),  neither  Acquirer nor any other  Person  makes any other  express or
implied  representation or warranty with respect to Acquirer or the transactions
contemplated by this Agreement, and Acquirer disclaims any other representations
or  warranties,  whether  made by Acquirer or any of its  affiliates,  officers,
directors, employees, agents or representatives.  Except for the representations
and  warranties  contained  in  this  Section  4 (as  modified  by the  Acquirer
Disclosure Schedule), Acquirer hereby disclaims all liability and responsibility
for  any  representation,   warranty,   projection,   forecast,   statement,  or
information made, communicated,  or furnished (orally or in writing) to HOVRS or
any of their affiliates or representatives (including any opinion,  information,
projection,  or  advice  that may have been or may be  provided  to HOVRS by any
director,  officer,  employee,  agent,  consultant,  or  representative  of  the
Acquirer or any of its  affiliates or  representatives).  The  disclosure of any
matter  or item in the  Acquirer  Disclosure  Schedule  shall  not be  deemed to
constitute an acknowledgement that any such matter is required to be disclosed.

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<PAGE>

5. Conduct Prior to the Effective Time.

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

            (a) Charter Documents. Cause or permit any amendments to its Charter
Documents; provided, however, that Acquirer may amend its Charter Documents:

                  (i) to decrease  the number of  authorized  shares of Acquirer
Common Stock to a number not less than 50,000,000;

                  (ii) to  declassify  its  board  of  directors,  so  that  all
directors  will be of a single  class and each will serve for a term of one year
and until his or her successor is elected and qualified; and

                  (iii)  to  file  an  Amended  and  Restated   Certificate   of
Incorporation  in the form attached hereto as Exhibit 6.22, to amend the rights,
preferences and privileges of the Acquirer Preferred Stock;

and  upon  the  effectiveness  of  any  such  amendment  to  Acquirer's  Charter
Documents, the related representations of Acquirer set forth in Section 4 hereof
shall be deemed to have been modified accordingly, mutatis mutandis;

            (b)  Dividends;  Changes  in  Capital  Stock.  Declare  or  pay  any
dividends  on or make  any  other  distributions  (whether  in  cash,  stock  or
property)  in  respect  of  any of its  capital  stock,  or  split,  combine  or
reclassify  any of its capital  stock or issue or authorize  the issuance of any
other  securities in respect of, in lieu of or in substitution for shares of its
capital stock, or

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repurchase  or  otherwise  acquire,  directly or  indirectly,  any shares of its
capital  stock,  except from former  employees,  directors  and  consultants  in
accordance with agreements  providing for the repurchase of shares in connection
with any termination of service to it;

            (c)  Stock  Option  Plans,  Etc.  In the case of  HOVRS,  except  as
required by this Agreement or permitted by or  contemplated  in the HOVRS Option
Plan, by any stock option agreement or by any employment  agreement entered into
by HOVRS  prior to the date  hereof,  and in the  case of  Acquirer,  except  as
approved by the stockholders of Acquirer at the Acquirer  Stockholders  Meeting,
accelerate,  amend or change the period of  exercisability or vesting of options
or other  rights  granted  under its stock plans or authorize  cash  payments in
exchange for any options or other rights granted under any of such plans;

            (d) Issuance of Securities.  Issue,  deliver or sell or authorize or
propose the  issuance,  delivery or sale of, or purchase or propose the purchase
of,  any  shares  of its  capital  stock  or  securities  convertible  into,  or
subscriptions,  rights,  warrants or options to acquire,  or other agreements or
commitments  of any  character  obligating  it to issue any such shares or other
convertible  securities other than (i) the issuance of shares of Common Stock by
HOVRS or Acquirer  pursuant to the exercise of stock options,  warrants or other
rights outstanding as of the date of this Agreement,  (ii) the grant by Acquirer
of options to purchase  Acquirer  Common Stock  pursuant to the  Acquirer  Stock
Option Plans,  (iii) with the  permission  of Acquirer,  which may be granted or
denied in Acquirer's discretion, the grant by HOVRS of options to purchase HOVRS
Common Stock pursuant to the HOVRS Option Plan or otherwise to persons  retained
by HOVRS in the ordinary  course of business as employees after the date hereof,
which options if granted prior to the Effective Time shall be treated as Assumed
HOVRS Options for all purposes  hereunder  (provided  that Acquirer shall advise
HOVRS  whether  it may issue  such  options  within  five (5)  Business  Days of
Acquirer's  receipt of a written  request from HOVRS to issue such options,  and
Acquirer's failure to respond within such five (5) Business Days shall be deemed
the grant of Acquirer's permission to grant the options proposed by HOVRS), (iv)
the  acceptance of promissory  notes as payment of exercise price and applicable
taxes from option holders exercising HOVRS Stock Options as of the Determination
Date,  which  promissory notes shall be paid in full as of the Closing Date; and
(v) the issuance of debt and equity  securities by Acquirer pursuant to existing
agreements with Clearlake and its affiliates;

            (e)  Intellectual  Property.  Transfer  to any  Person  any  rights,
present, future or contingent,  to its Intellectual Property other than granting
licenses in the ordinary course of business consistent with past practice;

            (f) Exclusive Rights.  Other than in the ordinary course of business
consistent  with past practice,  enter into or amend any agreements  pursuant to
which any other party is granted  exclusive  marketing or other exclusive rights
of any  type  or  scope  with  respect  to  any  of  such  party's  products  or
Intellectual Property;

            (g) Dispositions.  Sell,  lease,  license or otherwise dispose of or
encumber any of its properties or assets that are material,  individually  or in
the  aggregate,  to its business,  taken as a whole,  other than in the ordinary
course of business consistent with past practice or, in the case of Acquirer, as
contemplated  by existing  agreements  between  Acquirer  and  Clearlake  or its
affiliates;

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            (h)  Indebtedness.  Incur any  indebtedness  for borrowed  money, or
guarantee  any such  indebtedness,  or issue  or sell  any  debt  securities  or
guaranty any debt  securities  of others,  in excess of Fifty  Thousand  Dollars
($50,000) in the aggregate except, in the case of Acquirer, pursuant to existing
agreements with Clearlake or its affiliates;

            (i) Agreements. Other than in the ordinary course of business, enter
into, terminate or amend, in a manner that will adversely affect the business of
such party,  (i) any agreement  involving the  obligation to pay or the right to
receive  Twenty-Five  Thousand  Dollars  ($25,000) or more,  (ii) any  agreement
relating  to the  license,  transfer  or other  disposition  or  acquisition  of
Intellectual  Property rights or rights to market or sell such party's products,
or (iii) any other agreement material to the business or prospects of such party
or that is or would be a HOVRS Material Contract or Acquirer Material  Contract,
as the case may be;

            (j) Payment of Obligations.  Pay, discharge or satisfy, in an amount
in excess of  Twenty-Five  Thousand  Dollars  ($25,000)  in the  aggregate,  any
claims,  liabilities or obligations (absolute,  accrued, asserted or unasserted,
contingent or otherwise)  arising other than in the ordinary course of business,
other than the payment,  discharge or satisfaction  of liabilities  reflected or
reserved  against in the HOVRS  Financial  Statements or the Acquirer  Financial
Statements, as the case may be;

            (k)  Capital  Expenditures.  With  respect  to  Acquirer,  except as
contemplated by the Verizon Agreement,  make any capital  expenditures,  capital
additions or capital  improvements,  in excess of One Hundred  Thousand  Dollars
($100,000)  in the  aggregate;  and with  respect  to  HOVRS,  make any  capital
expenditures, capital additions or capital improvements in excess of One Hundred
Thousand Dollars ($100,000) in the aggregate;

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

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

            (n) Employee  Benefit Plans;  New Hires;  Pay  Increases.  Except as
provided under this  Agreement,  or required by Applicable  Law, amend any HOVRS
Employee Plan or adopt any plan that would  constitute a HOVRS Employee Plan, or
amend any  Acquirer  Employee  Plan or adopt any plan that would  constitute  an
Acquirer  Employee  Plan,  as the  case may be,  or hire  any new  officer-level
employee, pay any special bonus, special remuneration or special noncash benefit
(except payments and benefits made pursuant to written agreements outstanding on
the date hereof), or materially increase the benefits, salaries or wage rates of
its employees  (other than normal annual salary  increases  consistent with past
practices),  except  in the case of  Acquirer  as  contemplated  by the  Verizon
Agreement  or as  approved  by the  stockholders  of  Acquirer  at the  Acquirer
Stockholders Meeting;

            (o)   Severance   Arrangements.   Grant  or  pay  any  severance  or
termination  pay or benefits  (i) to any  director or officer or (ii) except for
payments made pursuant to written

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agreements  outstanding on the date hereof and disclosed on the HOVRS Disclosure
Schedule or the Acquirer Disclosure  Schedule,  as the case may be, to any other
employee;

            (p)  Lawsuits.  Commence a lawsuit  other  than (i) for the  routine
collection  of bills,  or (ii) in such  cases  where  such  party in good  faith
determines that failure to commence suit would result in the material impairment
of a valuable aspect of such party's business, provided that such party consults
with the other parties hereto prior to the filing of such a suit;

            (q) Acquisitions. Acquire or agree to acquire by merging with, or by
purchasing  a  substantial  portion  of the stock or assets  of, or by any other
manner,  any  business or any  corporation,  partnership,  association  or other
business  organization  or  division  thereof or  otherwise  acquire or agree to
acquire any assets that are material  individually  or in the aggregate,  to its
business,  taken as a whole,  except in the case of Acquirer as  contemplated by
the Verizon Agreement;

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

            (s)  Revaluation.  Revalue  any of  its  assets,  including  without
limitation  writing down the value of inventory or writing off notes or accounts
receivable  other than in the  ordinary  course of  business  or as  required by
changes in GAAP; or

            (t) Other. Take or agree in writing or otherwise to take, any of the
actions  described in Sections  5.1(a) through 5.1(s) above,  or any action that
would cause a material breach of its representations or warranties  contained in
this  Agreement  or prevent  it from  materially  performing  or cause it not to
materially perform its covenants hereunder.

      5.2. No Solicitation.

            (a)  During  the period  from the date of this  Agreement  until the
earlier of the termination of this Agreement or the Effective Time,  HOVRS shall
not,  directly  or  indirectly,   through  any  officer,   director,   employee,
representative or agent, (i) take any action to solicit, initiate,  encourage or
support any  inquiries or proposals  that  constitute,  or could  reasonably  be
expected to lead to, a proposal or offer for a merger,  consolidation,  business
combination,  sale of  substantial  assets,  sale of  shares  of  capital  stock
(including  without  limitation  by way of a tender offer,  but excluding  sales
pursuant to any exercise of  outstanding  stock options  granted under the HOVRS
Option  Plan)  or  similar   transactions   involving  HOVRS,   other  than  the
transactions  contemplated or expressly  permitted by this Agreement (any of the
foregoing inquiries or proposals being referred to in this Agreement as a "HOVRS
Transaction  Proposal"),  (ii) engage in negotiations or discussions concerning,
or provide  any  non-public  information  to any Person  relating  to, any HOVRS
Transaction  Proposal,  or  (iii)  agree  to  approve  or  recommend  any  HOVRS
Transaction Proposal.

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<PAGE>

            (b) HOVRS shall notify Acquirer no later than twenty-four (24) hours
after  receipt by HOVRS (or its advisors) of any HOVRS  Transaction  Proposal or
any request for nonpublic  information  in connection  with a HOVRS  Transaction
Proposal  or for  access to the  properties,  books or  records  of HOVRS by any
Person that informs HOVRS that it is  considering  making,  or has made, a HOVRS
Transaction Proposal.

            (c)  During  the period  from the date of this  Agreement  until the
earlier of the  termination  of this Agreement or the Effective  Time,  Acquirer
shall not,  directly or  indirectly,  through any officer,  director,  employee,
representative  or agent,  take any action to solicit,  initiate,  encourage  or
support any  inquiries or proposals  that  constitute,  or could  reasonably  be
expected to lead to, a proposal or offer for a merger,  consolidation,  business
combination,  sale of  substantial  assets,  sale of  shares  of  capital  stock
(including  without  limitation  by way of a tender offer,  but excluding  sales
pursuant to any exercise of  outstanding  stock options  granted under  Acquirer
Option  Plan)  or  similar  transactions  involving  Acquirer,  other  than  the
transactions  contemplated or expressly  permitted by this Agreement (any of the
foregoing  inquiries  or  proposals  being  referred to in this  Agreement as an
"Acquirer  Transaction  Proposal"),  (ii) engage in  negotiations or discussions
concerning, or provide any non-public information to any Person relating to, any
Acquirer  Transaction  Proposal,  or (iii)  agree to  approve or  recommend  any
Acquirer Transaction Proposal; provided, however, that nothing contained in this
Agreement  shall prevent  Acquirer or its board of directors  from (i) complying
with Rule 14e-2  promulgated  under the  Exchange Act with regard to an Acquirer
Transaction Proposal.

            (d) Acquirer shall notify HOVRS no later than twenty-four (24) hours
after receipt by Acquirer (or its advisors) of any Acquirer Transaction Proposal
or any  request  for  nonpublic  information  in  connection  with  an  Acquirer
Transaction  Proposal  or for  access to the  properties,  books or  records  of
Acquirer by any Person that informs Acquirer that it is considering  making,  or
has made, an Acquirer Transaction Proposal.

6. Additional Agreements.

      6.1. Proxy Statement.

            (a) As promptly as practicable after the date of this Agreement, but
in any  event no later  than  forty-five  (45) days  following  the date of this
Agreement,  Acquirer, in cooperation with HOVRS, shall prepare and file with the
SEC a proxy statement of Acquirer,  meeting the requirements of Delaware Law and
the Exchange Act and the  requirements  identified in Section 6.1(d) hereof (the
"Proxy Statement").  Each of Acquirer and HOVRS shall respond to any comments of
the SEC, and Acquirer shall cause the definitive Proxy Statement to be mailed to
its  stockholders at the earliest  practicable time after the Proxy Statement is
filed with the SEC,  subject to  compliance  with the  Exchange  Act,  including
without  limitation Rule 14a-6  thereunder,  but in no event later than five (5)
Business Days following the date on which the SEC shall have advised that it has
no further comments regarding the Proxy Statement;  provided,  however,  that if
the SEC Staff  advises  Acquirer  that it will not review  the Proxy  Statement,
Acquirer  shall cause the Proxy  Statement to be mailed to its  stockholders  no
later than twenty (20)  Business  Days after it is so advised.  Each of Acquirer
and HOVRS shall notify the other  promptly upon the receipt of any comments from
the SEC or its staff or any other Governmental  Entity and of any request by the
SEC or its staff or any Governmental Entity

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<PAGE>

for  amendments  or  supplements  to  the  Proxy  Statement  or  for  additional
information and shall supply the other with copies of all correspondence between
such party or any of its  representatives,  on the one hand, and the SEC, or its
staff or any other  Governmental  Entity, on the other hand, with respect to the
Proxy  Statement  or the Merger.  Each of Acquirer  and HOVRS shall use its best
efforts to cause all documents that it is responsible for filing with the SEC or
other  regulatory  authorities  under this Section 6.1 to comply in all material
respects with all applicable  requirements  of law and the rules and regulations
promulgated  thereunder.  Whenever  any event  occurs that is required to be set
forth in an amendment or supplement to the Proxy  Statement,  Acquirer or HOVRS,
as the case may be,  shall  promptly  inform  the other of such  occurrence  and
cooperate in filing with the SEC or its staff or any other Governmental  Entity,
and/or  mailing  to  stockholders  of HOVRS  and  Acquirer,  such  amendment  or
supplement.

            (b) In furtherance  and not in limitation of its  obligations  under
Section  6.1(a),  HOVRS shall  promptly  provide  Acquirer with the  information
required  to be  included in the Proxy  Statement  relating to HOVRS,  and HOVRS
shall use  commercially  reasonable  efforts  to  provide  Acquirer  with (i) an
unqualified  audit report signed by the firm of Gallina LLP with respect to each
of the annual audited financial  statements  included within the HOVRS Financial
Statements,  (ii) a consent in form and  substance  reasonably  satisfactory  to
Acquirer,  executed by such accounting firm as of a date within two (2) Business
Days of each of the dates on which the HOVRS Financial Statements are filed with
the SEC,  consenting  to the filing by Acquirer of such report with the SEC, and
(iii)  an  acknowledgment  in form  and  substance  reasonably  satisfactory  to
Acquirer,  executed  by such firm as of a date within two (2)  Business  Days of
each such  filing,  confirming  that such firm is  independent  with  respect to
HOVRS.

            (c) Except to the  extent  legally  required  for the  discharge  by
Acquirer's board of directors of its fiduciary duties as advised by such Board's
legal   counsel,   Acquirer  will  include  in  the  Proxy   Statement  (i)  the
recommendation  of the board of directors of Acquirer that the  stockholders  of
Acquirer vote to approve the Merger,  the issuance of the Acquirer  Common Stock
pursuant to this Agreement and such other matters as shall be required by Nasdaq
in connection  with the  consummation of the Merger and (ii) the written opinion
dated as of Duff &  Phelps,  financial  advisor  to the  board of  directors  of
Acquirer, to the effect that the Merger is fair, from a financial point of view,
to Acquirer.

            (d) Each of HOVRS and Acquirer shall ensure that the Proxy Statement
does not  contain  any untrue  statement  of a material  fact or omit to state a
material fact  necessary in order to make the  statements  made relating to such
party, in light of the circumstances  under which they were made, not misleading
(provided  that  such  party  shall  not be  responsible  for  the  accuracy  or
completeness  of any  information  concerning  the other party  furnished by the
other party for inclusion in the Proxy  Statement).  The Proxy  Statement  shall
contain  information to satisfy the  information  requirements of Rule 502(b) of
Regulation  D of the  Securities  Act for  purposes  of  satisfying  Rule 506 of
Regulation D of the Securities Act.

      6.2.  Preliminary  Proxy Statement.  As promptly as practicable  after the
date of this  Agreement,  but in any event no later than five (5) Business  Days
prior to the date of the filing of the preliminary  Proxy Statement with the SEC
(such  filing  date to be  mutually  agreed upon  between  Acquirer  and HOVRS),
Acquirer shall provide to HOVRS the  preliminary  Proxy

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Statement in a form that  Acquirer  advises HOVRS in writing is ready for filing
with the SEC (the "Preliminary Proxy Statement").

      6.3.  HOVRS  Stockholder  Approval.  Within five (5) Business  Days of the
receipt by HOVRS from Acquirer of the Preliminary  Proxy  Statement  pursuant to
Section  6.2,  HOVRS  shall  prepare  and  mail  to the  HOVRS  Stockholders  an
information  statement  regarding  the  Merger,  this  Agreement  and the  other
transactions  contemplated  hereunder,  together with a copy of the  Preliminary
Proxy  Statement  (the  "HOVRS  Information  Statement").  HOVRS  shall  provide
Acquirer with a reasonable  opportunity to review and comment upon drafts of the
HOVRS  Information  Statement.   Acting  through  its  board  of  directors,  in
accordance  with  Delaware  Law and its  Charter  Documents,  HOVRS will use its
commercially  reasonable  efforts to cause the Key HOVRS Stockholders to execute
and deliver their written  consent to the Merger,  this  Agreement and the other
transactions  contemplated  hereunder  and  the  documents  to  be  executed  in
connection  therewith,  and to the waiver of their rights of appraisal  relating
thereto, which consent shall be substantially in the form of Exhibit 6.3 hereto,
with such changes thereto as to which Acquirer may consent,  such consent not to
be unreasonably withheld, conditioned or delayed (the "Written Consent").

      6.4. Acquirer Stockholder Approval.  Acquirer, acting through its board of
directors,  in accordance  with  Applicable  Law, its Charter  Documents and the
rules and  listing  requirements  of  Nasdaq,  will duly call,  give  notice of,
convene and hold an annual or special meeting of its stockholders (the "Acquirer
Stockholders  Meeting") as soon as reasonably  practicable  after mailing of the
definitive Proxy Statement to the Acquirer's stockholders on a date (selected by
Acquirer  in  consultation  with  HOVRS),  for the  purpose  of  submitting  the
proposals  adopted by the board of  directors of Acquirer to approve the Merger,
the issuance of shares of Acquirer  Common Stock  pursuant to this Agreement and
such  other  matters  as shall be  required  by  Nasdaq in  connection  with the
consummation of the Merger and such other proposals relating to the consummation
of the Merger as Acquirer in its discretion  shall deem appropriate for adoption
and approval by the required vote of the holders of Acquirer capital stock.

      6.5. Access to Information.

            (a) HOVRS shall  afford  Acquirer and its  accountants,  counsel and
other representatives, reasonable access during normal business hours during the
period prior to the Effective Time to (i) all of HOVRS'  properties,  personnel,
books,  contracts,  commitments  and  records  and  (ii) all  other  information
concerning  the  business,  properties  and  personnel  of HOVRS as Acquirer may
reasonably request. Acquirer shall afford HOVRS and its accountants, counsel and
other representatives, reasonable access during normal business hours during the
period prior to the Effective Time to (i) all of Acquirer's  properties,  books,
contracts, commitments and records and (ii) all other information concerning the
business, properties and personnel of Acquirer as HOVRS may reasonably request.

            (b) Subject to compliance  with Applicable Law, from the date hereof
until the Effective  Time,  each of Acquirer and HOVRS shall confer on a regular
and frequent basis with one or more representatives of the other party to report
operational matters of materiality and the general status of ongoing operations.

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      6.6. Confidentiality. The parties acknowledge that Acquirer and HOVRS have
previously executed a mutual confidentiality agreement dated as of June 26, 2007
(the "Confidentiality  Agreement"),  which  Confidentiality  Agreement is hereby
incorporated  herein by reference and shall continue in full force and effect in
accordance with its terms.

      6.7.  Public  Disclosure.  Unless  otherwise  permitted by this Agreement,
Acquirer  and HOVRS  shall  consult  with each other  before  issuing  any press
release or otherwise  making any public statement or making any other public (or
non-confidential)  disclosure  (whether  or  not  in  response  to  an  inquiry)
regarding the terms of this Agreement and the transactions  contemplated hereby,
and neither  shall issue any such press  release or make any such  statement  or
disclosure  without the prior approval of the other (which approval shall not be
unreasonably  withheld),  except  as may be  required  by law or by  obligations
pursuant to any listing agreement with any national  securities exchange or with
Nasdaq.

      6.8. Regulatory Approval; Further Assurances.

            (a) To the extent  required by Applicable  Law, each party shall use
all  reasonable  efforts to file, as promptly as  practicable  after the date of
this Agreement, all notices, reports and other documents required to be filed by
such party with any Governmental Entity with respect to the Merger and the other
transactions  contemplated  by  this  Agreement,  and  to  submit  promptly  any
additional  information requested by any such Governmental Entity. Each of HOVRS
and Acquirer shall (i) give the other party prompt notice of the commencement of
any legal  proceeding by or before any  Governmental  Entity with respect to the
Merger or any of the other  transactions  contemplated by this  Agreement,  (ii)
keep the other party informed as to the status of any such legal proceeding, and
(iii) promptly inform the other party of any communication to or from the FCC or
any other Governmental Entity regarding the Merger.

            (b) Acquirer and HOVRS shall use all reasonable  efforts to take, or
cause to be taken,  all  actions  necessary  to  effectuate  the Merger and make
effective  the  other  transactions  contemplated  by  this  Agreement.  Without
limiting the  generality of the foregoing,  each party to this Agreement  shall:
(i) make any filings and give any notices  required to be made and given by such
party in connection with the Merger and the other  transactions  contemplated by
this Agreement;  (ii) use all reasonable  efforts to obtain any consent required
to be obtained  (pursuant to any applicable  legal  requirement or contract,  or
otherwise)  by such  party in  connection  with the  Merger  or any of the other
transactions  contemplated  by this  Agreement;  and  (iii)  use all  reasonable
efforts to lift any restraint, injunction or other legal bar to the Merger. Each
party shall promptly  deliver to the other a copy of each such filing made, each
such notice given and each such consent obtained by such party during the period
prior to the Effective Time. Each party, at the reasonable  request of the other
party,  shall execute and deliver such other instruments and do and perform such
other acts and things as may be necessary or desirable for effecting  completely
the consummation of this Agreement and the transactions contemplated hereby.

      6.9. HOVRS Options.  As soon as practicable  after the date hereof,  HOVRS
will take commercially  reasonable measure to provide notice of the transactions
contemplated  under this  Agreement  to the  holders of HOVRS  Stock  Options in
accordance with the terms of the HOVRS Option Plan.

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<PAGE>

      6.10. Form S-8. Acquirer agrees to file, no later than ten (10) days after
the Closing,  a  registration  statement on Form S-8 (or any successor  form) or
another  appropriate  form covering the shares of Acquirer Common Stock issuable
pursuant to the Assumed  HOVRS  Options  and shall use  commercially  reasonable
efforts at least  equivalent to those used in maintaining the  effectiveness  of
Acquirer's   other   registration   statements  on  Form  S-8  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 Assumed HOVRS Options remain outstanding.  The Stockholders'
Agent  shall  cooperate  with and assist  Acquirer  in the  preparation  of such
registration statement.

      6.11.  Issuance of  Securities  Exempt From  Registration;  Blue Sky Laws.
Assuming the delivery of certain  representations  by the HOVRS  Stockholders in
the Investment  Representation Letter, the offer and sale of the Acquirer Common
Stock in accordance with this Agreement will be exempt from the registration and
prospectus  delivery  requirements  of the Securities  Act and applicable  state
securities laws, and the shares of Acquirer Common Stock will be issued pursuant
to an exemption from the  registration and prospectus  delivery  requirements of
the Securities Act and applicable  state  securities  laws.  Acquirer shall take
such steps as may be necessary to comply with the  securities  and blue sky laws
of all  jurisdictions  applicable  to the  issuance of Acquirer  Common Stock in
connection with the Merger. HOVRS shall use its commercially  reasonable efforts
to  assist  Acquirer  to  comply  with the  securities  and blue sky laws of all
jurisdictions  applicable to the issuance of Acquirer Common Stock in connection
with the Merger.

      6.12.  Escrow Agreement.  On or before the Closing Date,  Acquirer and the
Stockholders' Agent will execute, and shall request the Escrow Agent to execute,
the Escrow  Agreement  contemplated  by Section 9.1, in  substantially  the form
attached as Exhibit  6.12,  provided  that prior to the  execution of the Escrow
Agreement,  Schedule I thereto shall be completed to list all HOVRS Stockholders
(other  than  holders of  Dissenting  Shares) and their  respective  pro rata or
percentage  interest  in the Escrow  Fund based  upon their  ownership  of HOVRS
Common  Stock or HOVRS  Preferred  Stock  immediately  prior to the Closing (the
"Escrow Agreement").

      6.13. Listing of Additional Shares.  Prior to the Effective Time, Acquirer
shall file with the  Nasdaq  Stock  Market a  Notification  Form for  Listing of
Additional  Shares with respect to the shares of Acquirer  Common Stock issuable
upon  conversion  of the HOVRS  Common  Stock and HOVRS  Preferred  Stock in the
Merger or upon exercise of Assumed HOVRS Options.  Prior to the Effective  Time,
Acquirer  shall  cause  Acquirer  Common  Stock to be issued in the Merger to be
authorized  for listing on the Nasdaq  Capital  Market upon  official  notice of
issuance.

      6.14.  Tax Matters.  Acquirer and HOVRS shall each use its best efforts to
cause the exchange of HOVRS Common Stock and HOVRS  Preferred Stock for Acquirer
Common  Stock in the Merger to qualify as a tax-free  exchange of  property  for
stock  pursuant  to  Section  351 of the Code and to obtain  the  opinion of its
respective counsel contemplated by Sections 7.2(d) and 7.3(d). HOVRS (on the one
hand),  and Acquirer and HOVRS Merger Sub (on the other hand) shall  execute and
deliver to both Orrick,  Herrington & Sutcliffe LLP and Chadbourne & Parke LLP a
letter (each, a "Tax  Representation  Letter")  making  reasonable and customary
representations  relating to certain Tax matters. The Tax Representation Letters
shall be

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<PAGE>

sufficient  to enable each such counsel to render the Tax opinions  contemplated
by Sections 7.2(d) and 7.3(d) at the Closing. Neither Acquirer, HOVRS Merger Sub
nor HOVRS shall take any action  prior to the Closing,  and  Acquirer  shall not
take any action (and shall  prevent the  Surviving  Corporation  from taking any
action)  following  the Closing that could  reasonably  be expected to cause the
exchange of the HOVRS Common Stock and HOVRS Preferred Stock for Acquirer Common
Stock in the Merger to fail to qualify as a tax-free  exchange  of  property  to
Acquirer in exchange for stock under Section 351 of the Code. No election  under
Section  338(g)  of the Code or under  any  comparable  provisions  of any other
state,  local or foreign laws shall be made with respect to the  acquisition  of
HOVRS by the Acquirer.

      6.15. Clearlake. Acquirer shall use commercially reasonable efforts (i) to
raise  additional  capital  through  the  sale of  Acquirer  Preferred  Stock to
Clearlake in an amount  sufficient  so that  Clearlake  and the holders of HOVRS
Common Stock and HOVRS Preferred Stock who will receive Acquirer Common Stock in
exchange for their  capital stock of HOVRS in the Merger will be in "control" of
Acquirer within the meaning of Section 368(c) of the Code immediately  following
the Merger and  completion  of the  corresponding  sale and issuance of Acquirer
Preferred  Stock to  Clearlake,  and (ii) to time the  closing  of such  sale of
Acquirer  Preferred  Stock to  Clearlake  to occur  on the  Closing  Date of the
Merger.  For the  avoidance  of doubt,  the  purchase  of  additional  equity by
Clearlake  on the Closing Date in an amount with a value equal to the greater of
Five  Million  Dollars  ($5,000,000)  and ten  percent  (10%)  of the  value  of
Clearlake's  holdings in Acquirer immediately prior to the Closing (based on the
average of the high and low prices for Acquirer Common Stock on the Closing Date
as reported on the Nasdaq Capital Market) shall satisfy Acquirer's obligations.

      6.16. Expenses.  If the Merger is not consummated,  all costs and expenses
incurred in connection  with this  Agreement and the  transactions  contemplated
hereby  shall be paid by the party  incurring  such  expense.  If the  Merger is
consummated,  Acquirer shall pay all of its Transaction Expenses,  and the HOVRS
Stockholders shall assume HOVRS' Transaction  Expenses only to the extent of the
amount that exceeds One Million Dollars  ($1,000,000) (which assumption shall be
made by a  reduction  in the amount of the Merger  Cash in  accordance  with the
definition thereof).

      6.17. Real Property Holding Corporation.  Pursuant to Treasury Regulations
Section 1.897-2(h) and Treasury Regulations Selection 1.1445-2(c)(3)(i),  at the
Closing  HOVRS shall  furnish to Acquirer a statement  certifying  that HOVRS is
not,  and has never  been  during the  applicable  period  specified  in Section
897(c)(1)(A)(ii)  of the Code, a United States real property holding corporation
within the meaning of Section 897(c)(2) of the Code.

      6.18.  Rule 144 Sales.  Acquirer  shall file all reports with the SEC in a
timely manner to ensure  compliance  with the  requirements of Rule 144(c) under
the Securities Act for a period of two (2) years after the Effective Time.

      6.19.  Guaranty  Releases.  Acquirer  shall take  commercially  reasonable
efforts to cause, as soon as practicable, but in no event later than thirty (30)
days,  following the Effective  Time,  the release of each guaranty set forth on
Section 3.11 to the HOVRS Disclosure Schedule.

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<PAGE>

      6.20.   Accountants'  Letters.  Each  of  Acquirer  and  HOVRS  shall  use
reasonable  best efforts to cause to be delivered to the other party two letters
from their respective independent accountants, one dated approximately as of the
date the Proxy Statement is mailed to the stockholders of Acquirer and one dated
approximately as of the Closing Date, each addressed to the other party, in form
and substance reasonably  satisfactory to the other party and customary in scope
and substance for comfort letters delivered by independent public accountants in
connection with transactions similar to the Merger.

      6.21.  Lock-up  Agreement.  On or before the Closing Date,  Acquirer shall
execute  and  deliver  to  the   Stockholders'   Agent  the  Lock-up   Agreement
substantially in the form of Exhibit 2.7(c)(i) hereto.

      6.22.  Radvision.  Prior to the Closing,  HOVRS will take all commercially
reasonable  measures  to obtain  from  Radvision,  Inc.  a release  of claims in
connection  with  HOVRS'  prior use of  Radvision  software  included in certain
deliverables provided by Vianet, Inc. to HOVRS.

      6.23.  Disclosure  Schedule.  Prior  to the  Closing,  each of  HOVRS  and
Acquirer  may  supplement  or amend the HOVRS  Disclosure  Schedule and Acquirer
Disclosure Schedule, respectively, delivered in connection herewith with respect
to any matter  which,  if existing or  occurring at or prior to the date of this
Agreement,  would have been  required to be set forth or  described in the HOVRS
Disclosure  Schedule  which is necessary to supplement  the  information  in the
HOVRS  Disclosure  Schedule,  or in the Acquirer  Disclosure  Schedule  which is
necessary to supplement  the  information in the Acquirer  Disclosure  Schedule,
which has been rendered a  representation  or warranty in Section 3 or Section 4
inaccurate by an event, condition, fact or circumstance occurring after the date
hereof; provided, however, that the HOVRS Disclosure Schedule may not be amended
or supplemented  with respect to any  representation  set forth in Section 3.21,
and the Acquirer  Disclosure  Schedule may not be amended or  supplemented  with
respect to any representation set forth in Section 4.21

7. Conditions to the Closing of the Merger.

      7.1.  Conditions to  Obligations  of Each Party to Effect the Merger.  The
respective  obligations  of Acquirer and HOVRS Merger Sub, on the one hand,  and
HOVRS,  on the other  hand,  to  consummate  and effect the Merger and the other
transactions  contemplated  hereby  shall be subject to the  satisfaction  at or
prior to the Closing Date of each of the following conditions,  any of which may
be waived, in writing, by agreement of all the parties hereto:

            (a) Stockholder  Approval.  This Agreement and the Merger shall have
been approved by the  stockholders of HOVRS by the requisite vote under Delaware
Law and HOVRS'  Charter  Documents.  The Merger,  the  issuance of the shares of
Acquirer  Common Stock pursuant to this Agreement and each other matter as shall
be required by Nasdaq in connection  with the  consummation  of the Merger shall
have been approved by the  stockholders  of Acquirer by the requisite vote under
Rule 4350(i)(1) of the Marketplace Rules of The NASDAQ Stock Market LLC.

            (b)  No  Injunctions  or   Restraints;   Illegality.   No  temporary
restraining order,  preliminary or permanent injunction or other order issued by
any court of competent  jurisdiction

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<PAGE>

or  other  legal  or  regulatory   restraint  or   prohibition   preventing  the
consummation  of the  Merger  shall be and  remain  in  effect,  nor  shall  any
proceeding   brought  by  an  administrative   agency  or  commission  or  other
Governmental  Entity,  domestic or  foreign,  seeking  any of the  foregoing  be
pending, which could reasonably be expected to have a Material Adverse Effect on
Acquirer,  either individually or combined with the Surviving  Corporation after
the Effective Time, nor shall there be any action taken,  or any statute,  rule,
regulation  or order  enacted,  entered,  enforced or deemed  applicable  to the
Merger, which makes the consummation of the Merger illegal.

            (c)  Governmental  Approval.  Acquirer,  HOVRS and HOVRS  Merger Sub
shall have timely obtained from each Governmental Entity all approvals,  waivers
and consents, necessary for consummation of or in connection with the Merger and
the several transactions contemplated hereby, including such approvals,  waivers
and  consents as may be  required  under the  Securities  Act and state blue sky
laws,  other than  filings and  approvals  relating  to the Merger or  affecting
Acquirer's ownership of HOVRS or any of its properties if failure to obtain such
approval,  waiver or consent could not reasonably be expected to have a Material
Adverse Effect on Acquirer after the Effective Time.

            (d) No  Governmental  Litigation.  There  shall  not be  pending  or
threatened  any  legal  proceeding  in  which  a  Governmental  Entity  is or is
threatened to become a party or is otherwise involved,  and neither Acquirer nor
HOVRS shall have  received any  communication  from any  Governmental  Entity in
which such Governmental Entity indicates the probability of commencing any legal
proceeding or taking any other action: (i) challenging or seeking to restrain or
prohibit the consummation of the Merger; (ii) relating to the Merger and seeking
to obtain from  Acquirer or any of its  Subsidiaries,  or HOVRS,  any damages or
other relief that would be material to Acquirer after the Effective Time;  (iii)
seeking to prohibit or limit in any material respect Acquirer's ability to vote,
receive  dividends with respect to or otherwise  exercise  ownership rights with
respect  to the  stock of HOVRS;  or (iv) that  would  prohibit  or  effectively
prohibit  the  right of  Acquirer  or HOVRS to own the  assets  or  operate  the
business of HOVRS.

            (e) No Other  Litigation.  There  shall  not be  pending  any  legal
proceeding:  (i) challenging or seeking to restrain or prohibit the consummation
of the Merger or any of the other  transactions  contemplated by this Agreement;
(ii)  relating to the Merger and  seeking to obtain from  Acquirer or any of its
Subsidiaries,  or HOVRS,  any damages or other  relief that would be material to
Acquirer;  (iii) seeking to prohibit or limit in any material respect Acquirer's
ability  to vote,  receive  dividends  with  respect  to or  otherwise  exercise
ownership  rights with respect to any shares of the capital  stock of HOVRS;  or
(iv) that would prohibit or effectively  prohibit the right of Acquirer or HOVRS
to own the assets or operate the business of HOVRS.

            (f)  Verizon  Transaction.  The  transactions  contemplated  by  the
Verizon Agreement shall have been consummated.

            (g)  Escrow   Agreement.   Acquirer,   the  Escrow   Agent  and  the
Stockholders' Agent shall have entered into an Escrow Agreement substantially in
the form attached hereto as Exhibit 6.12.

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<PAGE>

      7.2. Additional Conditions to the Obligations of Acquirer. The obligations
of  Acquirer  to  consummate  and effect  the Merger and the other  transactions
contemplated  hereby  shall be  subject to the  satisfaction  at or prior to the
Closing Date of each of the following conditions, any of which may be waived, in
writing, by Acquirer:

            (a) Representations,  Warranties and Covenants.  The representations
and  warranties  of HOVRS in this  Agreement  shall be true and  correct  in all
respects on and as of the date of this Agreement and at and as of the Closing as
though  such  representations  and  warranties  were made on and as of such time
(except for such  representations  and warranties that speak  specifically as of
the date  hereof or as of another  date,  which  shall be true and correct as of
such date),  disregarding for the purposes of such  determination  any "Material
Adverse   Effect"   or  other   materiality   qualifiers   set   forth  in  such
representations and warranties, except for such failures of such representations
and  warranties  regarding  HOVRS,  its business or properties to be so true and
correct as could not,  individually or in the aggregate,  reasonably be expected
to have a Material Adverse Effect on HOVRS.

            (b)  Performance  of  Obligations.  HOVRS shall have  performed  and
complied in all material respects with all covenants, obligations and conditions
of this  Agreement  required to be performed  and complied  with by it as of the
Closing.

            (c)  Certificate  of  Officers.   Acquirer  shall  have  received  a
certificate executed on behalf of HOVRS by the Chief Executive Officer and Chief
Financial  Officer of HOVRS certifying that the conditions set forth in Sections
7.2(a) and 7.2(b) have been satisfied.

            (d) Tax Opinion. Acquirer shall have received a written opinion from
Acquirer's  legal  counsel to the effect that the  exchange of the HOVRS  Common
Stock and HOVRS  Preferred  Stock for Acquirer Common Stock in the Merger should
be treated for federal  income tax purposes as an exchange of property for stock
under Section 351 of the Code.

            (e) Third Party Consents.  All consents or approvals  required to be
obtained  by HOVRS in  connection  with the  Merger  and the other  transactions
contemplated  by this  Agreement,  including  consent under the Master  Services
Agreement dated July 1, 2007 by and between HOVRS and  Sprint/United  Management
Company,  shall have been obtained and shall be in full force and effect, except
where  the  failure  to  obtain  any  such  consents  or  approvals   could  not
individually  or in the  aggregate  be  reasonably  expected  to have a Material
Adverse Effect on HOVRS.

            (f) Opinion. Counsel for HOVRS, Orrick,  Herrington & Sutcliffe LLP,
shall have delivered to Acquirer an opinion,  reasonably acceptable to Acquirer,
covering such matters as are  customary in  transactions  of the type  described
herein, substantially in the form attached hereto as Exhibit 7.2(f).

      7.3.  Additional  Conditions to Obligations of HOVRS.  The  obligations of
HOVRS  to  consummate   and  effect  the  Merger  and  the  other   transactions
contemplated  hereby  shall be  subject to the  satisfaction  at or prior to the
Closing Date of each of the following conditions, any of which may be waived, in
writing, by HOVRS:

                                       75
<PAGE>

            (a) Representations,  Warranties and Covenants.  The representations
and  warranties of Acquirer in this  Agreement  shall be true and correct in all
respects on and as of the date of this Agreement and at and as of the Closing as
though  such  representations  and  warranties  were made on and as of such time
(except for such  representations  and warranties that speak  specifically as of
the date  hereof or as of another  date,  which  shall be true and correct as of
such date),  disregarding for the purposes of such  determination  any "Material
Adverse   Effect"   or  other   materiality   qualifiers   set   forth  in  such
representations and warranties, except for such failures of such representations
and warranties regarding Acquirer,  its business or properties to be so true and
correct as could not,  individually or in the aggregate,  reasonably be expected
to have a Material Adverse Effect on Acquirer.

            (b)  Performance of  Obligations.  Acquirer shall have performed and
complied in all material respects with all covenants, obligations and conditions
of this  Agreement  required to be performed  and complied  with by it as of the
Closing.

            (c) Certificate of Officers. HOVRS shall have received a certificate
executed  on  behalf  of  Acquirer  by the  Chief  Executive  Officer  and Chief
Financial  Officer  of  Acquirer  certifying  that the  conditions  set forth in
Sections 7.3(a) and 7.3(b) have been satisfied.

            (d) Tax Opinion.  HOVRS shall have  received a written  opinion from
HOVRS'  legal  counsel to the effect that the exchange of the HOVRS Common Stock
and HOVRS  Preferred  Stock for Acquirer  Common  Stock in the Merger  should be
treated for  federal  income tax  purposes as an exchange of property  for stock
under Section 351 of the Code.

            (e) Third Party Consents.  All consents or approvals  required to be
obtained by Acquirer in  connection  with the Merger and the other  transactions
contemplated  by this  Agreement  shall have been  obtained and shall be in full
force and  effect,  except  where the  failure  to obtain any such  consents  or
approvals could not  individually or in the aggregate be reasonably  expected to
have a Material Adverse Effect on Acquirer.

            (f)  Opinions.  Counsels  for  Acquirer,  Chadbourne & Parke LLP and
Lowenstein  Sandler  PC,  shall have  delivered  to HOVRS  opinions,  reasonably
acceptable to HOVRS,  covering such matters as are customary in  transactions of
the type described herein,  substantially in the form attached hereto as Exhibit
7.3(f) (it being understood that some but not all such opinions may be delivered
by either such firm, provided that all such opinions are delivered  collectively
by both firms).

            (g) Amended and  Restated  Certificate  of  Incorporation.  Acquirer
shall have duly  adopted,  executed and filed with the Secretary of State of the
State of Delaware the Amended and Restated  Certificate of  Incorporation in the
form attached hereto as Exhibit 7.3(h).

            (h)  Election  of  Directors.  The  directors  designated  by  HOVRS
identified  on Exhibit  2.5 shall  have been duly  elected to serve the board of
directors of Acquirer.

            (i)  Clearlake.  Acquirer  shall have completed the sale of Acquirer
Preferred  Stock to Clearlake in an amount  sufficient so that Clearlake and the
holders  of HOVRS  Common  Stock and HOVRS  Preferred  Stock  that will  receive
Acquirer  Common Stock in exchange for their stock of HOVRS in the Merger are in
"control"  of  Acquirer  within  the  meaning  of  Section

                                       76
<PAGE>

368(c) of the Code immediately following the Merger, and such sale will occur on
the Closing  Date of the Merger.  For the  avoidance  of doubt,  the purchase of
additional  equity of Acquirer by Clearlake  on the Closing  Date that  complies
with the ten percent  (10%) safe harbor rule of Revenue  Procedure  77-37 (i.e.,
Clearlake shall acquire Acquirer Preferred Stock in an amount with a value equal
to the greater of Five Million Dollars ($5,000,000) and ten percent (10%) of the
value of  Clearlake's  holdings  in  Acquirer  immediately  prior to the Closing
(based on the average of the high and low prices for  Acquirer  Common  Stock on
the Closing Date as reported on the Nasdaq  Capital  Market)) shall satisfy this
condition.  Acquirer shall have obtained the representations  from Clearlake and
Reservoir  Capital  Group,  L.L.C.,  on behalf of all the  limited  partners  of
Clearlake, to be delivered thereby pursuant to that certain  Clearlake/Reservoir
Certificate of even date herewith  delivered by Clearlake and Reservoir  Capital
Group, L.L.C. to Acquirer and HOVRS.

8. Termination, Amendment and Waiver.

      8.1.  Termination.  This  Agreement may be terminated at any time prior to
the Effective Time (with respect to Section 8.1(b) through  Section  8.1(d),  by
written notice by the terminating party to the other party):

            (a) by the mutual written consent of Acquirer and HOVRS;

            (b) by  Acquirer  or  HOVRS  if  the  Merger  shall  not  have  been
consummated  by the earlier of (i) February 29, 2008,  or (ii)  forty-five  (45)
days  following  the date on which the SEC  shall  have  advised  that it has no
further  comments  regarding the Proxy Statement (or that it will not review the
Proxy  Statement)  and Acquirer has received all  necessary  approvals  from the
states of  California  and  Tennessee and the District of Columbia in connection
with the  transactions  contemplated  under the Verizon  Agreement (the "Outside
Date"); provided, however, that the right to terminate this Agreement under this
Section  8.1(b) shall not be available to any party whose failure to fulfill any
obligation under this Agreement has been the cause of or resulted in the failure
of the Merger to occur on or before such date;

            (c) by Acquirer  or HOVRS if a court of  competent  jurisdiction  or
other Governmental  Entity shall have issued a nonappealable final order, decree
or  ruling  or taken  any  other  action,  in each  case  having  the  effect of
permanently  restraining,  enjoining or otherwise prohibiting the Merger, unless
the party  relying  on such  order,  decree or  ruling or other  action  has not
complied in all material respects with its obligations under this Agreement;

            (d) by  Acquirer  or  HOVRS,  if  there  has  been a  breach  of any
representation,  warranty,  covenant or agreement on the part of the other party
set forth in this Agreement, which breach (i) causes the conditions set forth in
Section 7.1 or 7.2 (in the case of  termination  by  Acquirer) or Section 7.1 or
7.3 (in the case of  termination  by HOVRS) not to be satisfied,  and (ii) shall
not have been  cured  within ten (10)  Business  Days  following  receipt by the
breaching party of written notice of such breach from the other party;

            (e) by Acquirer or HOVRS, if the requisite votes by the stockholders
of Acquirer in order to consummate the transactions  described in this Agreement
are not obtained at the Acquirer  Stockholders Meeting, or at any adjournment or
postponement thereof; or

                                       77
<PAGE>

            (f) by  Acquirer  or HOVRS,  if HOVRS does not deliver to Acquirer a
copy of the  Written  Consent  that has been  executed  by each of the Key HOVRS
Stockholders  within five (5) Business Days after Acquirer delivers to HOVRS the
Preliminary Proxy Statement pursuant to Section 6.2, or if at any time after the
delivery of the  Written  Consent  any of the Key HOVRS  Stockholders  takes any
action intended to withdraw, rescind or revoke the Written Consent.

      8.2. Effect of Termination.

            (a) In the  event  of  termination  of this  Agreement  pursuant  to
Section 8.1(e), Acquirer shall, concurrently with such termination,  pay HOVRS a
fee equal to One Million  Five  Hundred  Thousand  Dollars  ($1,500,000)  in the
aggregate,  if and  only if (i)  the  requisite  votes  by the  stockholders  of
Acquirer  were not obtained to approve the Merger,  the issuance of the Acquirer
Common  Stock  pursuant  to this  Agreement  and each  other  matter as shall be
required by Nasdaq in connection with the  consummation  of the Merger,  but the
requisite  votes by the  stockholders  of Acquirer  were obtained to approve the
transactions  contemplated  by the  Verizon  Agreement,  or (ii)  either (A) the
Acquirer  Stockholders  Meeting has not been noticed and convened by the Outside
Date or (B) the Acquirer  Stockholders Meeting has been held by the Outside Date
but  the  foregoing  proposal  has  not  been  put to a vote  of the  Acquirer's
stockholders at such Acquirer  Stockholders  Meeting (or any adjournment thereof
held not later than the Outside Date).

            (b) In the  event  of  termination  of this  Agreement  pursuant  to
Section 8.1(f), HOVRS shall, concurrently with such termination,  pay Acquirer a
fee equal to One Million  Five  Hundred  Thousand  Dollars  ($1,500,000)  in the
aggregate.

            (c) In the event of termination of this Agreement  other than as set
forth in Section 8.2(a) or 8.2(b),  there shall be no liability or obligation on
the  part  of  Acquirer,  HOVRS  or  their  respective  officers,  directors  or
stockholders,  except to the  extent  that  such  termination  results  from the
willful breach by a party of any of its representations, warranties or covenants
set forth in this Agreement. The provisions of Sections 6.6, 6.7, 6.15, 6.16 and
10 shall  remain in full force and effect and  survive any  termination  of this
Agreement.

      8.3.  Amendment.  This Agreement may be amended by the parties hereto,  by
action  taken or  authorized  by their  respective  boards  of  directors.  This
Agreement may not be amended except by an instrument in writing signed on behalf
of each of the parties hereto.

      8.4.  Extension;  Waiver.  At any time prior to the  Effective  Time,  the
parties  hereto,  by action taken or  authorized by their  respective  boards of
directors,  may,  to the  extent  legally  allowed:  (i) extend the time for the
performance of any of the obligations or other acts of the other parties hereto;
(ii) waive any  inaccuracies  in the  representations  and warranties  contained
herein or in any document  delivered pursuant hereto; and (iii) waive compliance
with any of the agreements or conditions  contained herein. Any agreement on the
part of a party  hereto to any such  extension  or waiver shall be valid only if
set forth in a written instrument signed on behalf of such party.

9. Escrow and Indemnification.

      9.1. Escrow Fund.

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            (a) At the  Closing,  the Escrow  Cash shall be  deposited  with the
Escrow  Agent to  constitute  the Escrow  Fund and be  governed by the terms set
forth herein and in the Escrow Agreement.  The Escrow Fund shall be available to
compensate  Acquirer  pursuant to the  indemnification  obligations of the HOVRS
Stockholders.

            (b) For income tax  purposes,  all  earnings  on  investment  of the
Escrow Cash shall be reported by Acquirer.  The parties hereto  acknowledge  and
agree that upon the  release of the Escrow Fund in  accordance  with this Escrow
Agreement,  a portion of the payment will be treated as a payment of interest to
the HOVRS  Stockholders,  and the  Acquirer  will be  permitted a  corresponding
interest  deduction,  determined by treating the entire  payment under the rules
set forth in Section  1.1275-4(c)(4)  of the  Treasury  Regulations.  The Escrow
Agent shall make a  distribution  within (30) thirty days  following  the end of
each calendar year of all interest and other amounts  earned with respect to the
Escrow Cash to the HOVRS  Stockholders in accordance with their pro rata portion
of the Escrow Cash, as set forth on Schedule I attached to the Escrow Agreement.

      9.2. Indemnification.

            (a)  Survival  of  Warranties  and  Covenants.  Except as  otherwise
specified herein, all  representations  and warranties made by Acquirer or HOVRS
herein, or in any certificate,  schedule or exhibit  delivered  pursuant hereto,
shall  survive the Closing and  continue in full force and effect until the date
that is twelve (12) months after the Closing Date (the "Termination  Date"). All
covenants and agreements made by the parties to this Agreement which contemplate
performance  following  the  Closing  Date shall  survive  the  Closing  Date in
accordance  with their terms.  All covenants  and  agreements  that  contemplate
performance  prior to the  Closing  Date shall not  survive  the  Closing  Date;
provided,  however,  that if any such  covenant or  agreement  is breached on or
prior to the Closing Date, the  non-breaching  party shall retain all rights and
remedies  hereunder  with respect to such breach  following  the Closing Date in
accordance with this Agreement.  The indemnification  obligations provided under
this  Section 9 shall  survive the Closing  Date and remain in effect  until the
Termination Date, except for  indemnification  obligations for Damages under the
FCC Subpoena as related to any HOVRS Unapproved  Marketing Program (as described
in Section  9.2(b)) or the FCC  Letter as  related  to any  Acquirer  Unapproved
Marketing Program (described in Section 9.3(b)), as to which the indemnification
obligations hereunder shall remain during the Reserved Escrow Period (as defined
below) in accordance with Section 9.3 hereof.

            (b)   Indemnification   by  HOVRS   Stockholders.   Subject  to  the
limitations set forth in this Section 9, the HOVRS Stockholders will,  severally
and not jointly, indemnify and hold harmless Acquirer, the Surviving Corporation
and their respective officers,  directors,  agents, attorneys and employees, and
each  person,  if any,  who  controls or may control  Acquirer or the  Surviving
Corporation  within  the  meaning  of the  Securities  Act  (each  an  "Acquirer
Indemnified Party" and collectively the "Acquirer  Indemnified  Parties"),  from
and  against any and all  losses,  costs,  damages,  liabilities  and  expenses,
including without limitation legal fees, from claims,  demands,  actions, causes
of action (collectively, "Damages") arising out of the following:

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                  (i)  any   misrepresentation   or  breach  of  or  default  in
connection with any of the representations, warranties, covenants and agreements
given or made by HOVRS in this Agreement,  the HOVRS Disclosure  Schedule or any
exhibit or schedule to this Agreement; and

                  (ii) any violation or alleged violation of the  Communications
Act of 1934, as amended, including amendments made by the Telecommunications Act
of 1996, 47 U.S.C.  ss. 151 et seq., and the rules and regulations of the FCC or
the National Exchange Carrier  Association  (collectively,  the  "Communications
Act"),  and any  violation or alleged  violation of any public  utility or other
similar   statutes   which   specifically   govern   and   regulate   intrastate
telecommunications  or relay  service in the various  states,  in each case that
occur  prior to the  Effective  Time,  that is  directly  related  to the HOVRS'
Unapproved  Marketing  Programs  that  are  not  continued  by  Acquirer  or the
Surviving  Corporation in the conduct of its business after the Effective  Time,
including  any alleged  violation of the  Communications  Act or other law found
pursuant to that certain  subpoena issued by the Enforcement  Bureau of the FCC,
Case No.  EB-07-TC-4008,  by  letter  to HOVRS  dated  August  6, 2007 (the "FCC
Subpoena")  as it may be related to a HOVRS  Unapproved  Marketing  Program (the
"FCC  Investigation").  As used herein,  "HOVRS Unapproved  Marketing  Programs"
means (i) each marketing program that is conducted by HOVRS prior to the Closing
Date that HOVRS  submits in writing to Acquirer  for  approval at least  fifteen
(15) days before the Closing  Date and as to which  Acquirer  notifies  HOVRS in
writing that it disapproves within fifteen (15) days of such submission by HOVRS
and (ii) each marketing  program that is conducted by HOVRS prior to the Closing
Date that HOVRS does not submit in writing to  Acquirer  for  approval  at least
fifteen (15) days before the Closing Date.

The Acquirer  Indemnified  Parties shall act in good faith and in a commercially
reasonable  manner to mitigate  any and all Damages.  Claims  against the Escrow
Fund (valued as of the Closing Date) shall be the sole and  exclusive  remedy of
the Acquirer Indemnified Parties for any Damages hereunder,  provided,  however,
that the liability of HOVRS or the HOVRS Stockholders for Damages arising from a
breach of any  representation,  warranty or covenant  based on a criminal act or
fraud shall be limited to the aggregate value of the Merger Consideration.

            (c)  Indemnification  by Acquirer.  Subject to the  limitations  set
forth in this Section 9, Acquirer  hereby  agrees to indemnify,  defend and hold
harmless  the HOVRS  Stockholders  and  their  respective  officers,  directors,
agents,  attorneys  and  employees,  and each Person who controls or may control
HOVRS or any  such  HOVRS  Stockholder  (each a "HOVRS  Indemnified  Party"  and
collectively,  the "HOVRS  Indemnified  Parties")  from and  against any and all
Damages arising out of the following:

                  (i)  any   misrepresentation   or  breach  of  or  default  in
connection with any of the representations, warranties, covenants and agreements
given or made by Acquirer in this Agreement, the Acquirer Disclosure Schedule or
any exhibit or schedule to this Agreement; and

                  (ii) any violation or alleged violation of the  Communications
Act,  and any  violation  or alleged  violation  of any public  utility or other
similar   statutes   which   specifically

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govern  and  regulate  intrastate  telecommunications  or relay  service  in the
various  states,  in each case that occur prior to the Effective  Time,  that is
directly  related to the Acquirer  Unapproved  Marketing  Programs  that are not
continued  by  Acquirer  or the  Surviving  Corporation  in the conduct of their
business  after the  Effective  Time,  including  any alleged  violation  of the
Communications Act or other law found pursuant to that certain  investigation by
the FCC commenced by letter to Acquirer dated May 7, 2007 (the "FCC Letter"). As
used herein,  "Acquirer  Unapproved Marketing Programs" means (i) each marketing
program that is conducted  by Acquirer  prior to the Closing Date that  Acquirer
submits in writing to HOVRS for  approval at least  fifteen (15) days before the
Closing  Date  and as to  which  HOVRS  notifies  Acquirer  in  writing  that it
disapproves  within  fifteen (15) days of such  submission  by Acquirer and (ii)
each  marketing  program that is conducted by Acquirer prior to the Closing Date
that  Acquirer  does not submit in writing to  Acquirer  for  approval  at least
fifteen (15) days before the Closing Date.

The HOVRS  Indemnified  Parties  shall act in good  faith and in a  commercially
reasonable manner to mitigate any and all Damages. The maximum amount of Damages
for  which  Acquirer  shall  be  liable   hereunder  is  Five  Million   Dollars
($5,000,000),  provided,  however,  that the  liability  of Acquirer for Damages
arising  from a breach of any  representation,  warranty or covenant  based on a
criminal  act or fraud  shall be  limited to the  aggregate  value of the Merger
Consideration.

            (d) Deductible for Claims.  No claim for Damages shall be made under
Section 9 unless the  aggregate of Damages  exceeds Two Hundred  Fifty  Thousand
Dollars  ($250,000) for which claims are made hereunder by the HOVRS Indemnified
Parties  or  Acquirer  Indemnified  Parties,  as the case  may be,  and it being
understood and agreed that the Two Hundred Fifty Thousand Dollars  ($250,000) is
intended as a  deductible,  and none of the HOVRS  Indemnifying  Parties nor the
Acquirer  Indemnifying  Parties  shall be liable for the first Two Hundred Fifty
Thousand Dollars  ($250,000) of Damages for which the HOVRS Indemnified  Parties
or  Acquirer   Indemnified  Parties,  as  the  case  may  be,  are  entitled  to
indemnification;  provided,  however,  that the foregoing  deductible  shall not
apply to any claim for Damages  arising under Section  9.2(b)(ii) or 9.2(c)(ii),
which shall be subject to indemnification on a  dollar-for-dollar  basis without
regard to the foregoing deductible.

      9.3. Escrow Period; Release From Escrow.

            (a) Subject to the following requirements,  the Escrow Fund shall be
in existence as of the Effective Time and shall terminate at 5:00 p.m.,  Pacific
Daylight  Time on the  Termination  Date (the "Escrow  Period"),  and the Escrow
Agent shall  release and  distribute  the Escrow Fund within  three (3) Business
Days after the  expiration of the Escrow Period to the HOVRS  Stockholders  on a
pro rata basis in accordance with the percentages set forth on Schedule I to the
Escrow  Agreement;  provided,  however,  that  (i)  100%  of the  amount  of any
unsatisfied  claims for Damages (other than in connection with the FCC Subpoena)
specified  in any  Officer's  Certificate  delivered in good faith to the Escrow
Agent  prior to the  expiration  of the  Escrow  Period  with  respect to claims
existing  prior to the  expiration of the Escrow Period (the  "Unresolved  Claim
Amount"),  shall not be released  until such claims are  resolved in  accordance
with Section 9.5 hereof, and (ii) subject to Section 9.3(b), the Reserved Escrow
Amount shall be retained in the Escrow Fund and shall not be released if the FCC
Investigation

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<PAGE>

is not Terminated or if actual Damages have been incurred in connection with the
FCC  Investigation  but have not been  resolved in  accordance  with Section 9.5
hereof.

            (b) The FCC Investigation  shall be terminated or deemed terminated,
if (i) the FCC has issued a notice of termination of the FCC Investigation, (ii)
the FCC has not issued a notice of apparent  liability or similar  order seeking
forfeiture  in  connection  with the FCC  Investigation,  or (iii) HOVRS has not
entered  into a tolling  agreement  to extend  the  statute  of  limitations  in
connection with the FCC  Investigation ( these conditions being  individually or
collectively  referred to as "Terminated").  At the end of the Escrow Period, if
the FCC  Investigation  is  Terminated,  the  Escrow  Agent  shall  release  and
distribute the Escrow Fund to the HOVRS Stockholders in accordance with Schedule
I of  the  Escrow  Agreement.  At  the  end of the  Escrow  Period,  if the  FCC
Investigation has not been Terminated, a portion of the Escrow Fund equal to the
lesser of Two Million  Dollars  ($2,000,000)  or if  determinable  the amount of
potential  Damages  reasonably  specified by Acquirer in  consultation  with the
Stockholders'  Agent and agreed upon by the Stockholders' Agent as the potential
Damages in connection with the FCC Investigation  (the "Reserved Escrow Amount")
shall remain in existence  until and terminate on the earlier of (i) twenty-four
(24) months after the Closing Date,  (ii) the date on which the FCC has issued a
notice of  termination of the FCC  Investigation  or (iii) the date on which all
actual Damages incurred in connection with the FCC Investigation and resolved in
accordance  with  Section  9.5 have  been  paid in full  (the  "Reserved  Escrow
Period");  provided,  however,  that in the event  that  prior to the end of the
Reserved  Escrow  Period the FCC has issued a notice of  apparent  liability  or
similar order specifying  alleged Damages,  the amount of such specified Damages
shall  remain in the Escrow Fund until a final order  resolving  such matter has
been issued and Acquirer has determined to pay any amount due. At the expiration
of the Reserved  Escrow Period (or any other period during which funds remain in
the Escrow  Fund  pursuant  to this  Section  9.3(b)),  the Escrow  Agent  shall
promptly (and in any event no later than three (3) Business  Days  following the
date of  expiration)  release all  property  remaining in the Escrow Fund to the
HOVRS Stockholders in accordance with Schedule I of the Escrow Agreement.

            (c) No property held in the Escrow Fund or any  beneficial  interest
therein may be pledged, sold, assigned or transferred, including by operation of
law, by any HOVRS  Stockholder  or be taken or reached by any legal or equitable
process in satisfaction of any debt or other liability of any such  stockholder,
prior  to the  delivery  to such  stockholder  of such  stockholder's  allocable
portion of the Escrow Fund by the Escrow Agent as provided herein.

      9.4.  Claims  Upon Escrow  Fund.  Upon  receipt by the Escrow  Agent on or
before the  expiration of Escrow Period or in connection  with the FCC Subpoena,
on or before the  expiration  of the Reserved  Escrow  Period,  of a certificate
signed by any executive officer of Acquirer (an "Officer's Certificate") stating
that  Damages  have  been  incurred  and  are  subject  to  the  indemnification
obligations of the HOVRS  Stockholders,  and specifying in reasonable detail the
individual items of such Damages included in the amount so stated, the date each
such  item was  paid,  or  properly  accrued  or  arose,  and the  nature of the
misrepresentation,  breach of warranty,  covenant or claim to which such item is
related,  the Escrow  Agent  shall,  subject to the  provisions  of Section 9.5,
distribute  to Acquirer  out of the Escrow  Fund,  as  promptly as  practicable,
property held in the Escrow Fund having a value equal to such Damages.

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      9.5. Objections to Claims.

            (a) At the time of  delivery  of any  Officer's  Certificate  to the
Escrow Agent, a duplicate copy of such Officer's  Certificate shall be delivered
to the  Stockholders'  Agent.  For a period  of  thirty  (30)  days  after  such
delivery,  the Escrow  Agent shall make no delivery of property  from the Escrow
Fund  to  Acquirer   unless  the  Escrow  Agent  shall  have  received   written
authorization  from the  Stockholders'  Agent to make such  delivery.  After the
expiration  of such  30-day  period,  the Escrow  Agent  shall make  delivery of
property from the Escrow Fund to Acquirer in accordance with Section 9.4 hereof,
provided that no such payment or delivery may be made if the Stockholders' Agent
shall  object  in a  written  statement  to the  claim  made  in  the  Officer's
Certificate (the "Objection Notice"),  and such Objection Notice shall have been
delivered to the Escrow Agent and to Acquirer  prior to the  expiration  of such
30-day period.

            (b)  In  case  the  Stockholders'  Agent  shall  have  delivered  an
Objection  Notice,  Acquirer shall have thirty (30) days to respond in a written
statement to the  objection  of the  Stockholders'  Agent.  If after such 30-day
period there  remains a dispute as to any claims,  the  Stockholders'  Agent and
Acquirer shall attempt in good faith for sixty (60) days from the  Stockholders'
Agent's  delivery  of the  Objection  Notice  to agree  upon the  rights  of the
respective  parties with respect to each of such  claims.  If the  Stockholders'
Agent and Acquirer  should so agree,  a memorandum  setting forth such agreement
shall be  prepared  and signed by both  parties  and shall be  furnished  to the
Escrow Agent.  The Escrow Agent shall be entitled to rely on any such memorandum
and shall  distribute  property  from the Escrow Fund to Acquirer in  accordance
with Section 9.4.

      9.6. Claims by HOVRS Indemnitees.

            (a) Subject to the  provisions  of this  Section 9, upon  receipt by
Acquirer  of  a  certificate  signed  by  the  Stockholders'  Agent  (an  "Agent
Certificate")  stating  that Damages  exist with respect to the  indemnification
obligations of Acquirer set forth in Section 9.2(c) and specifying in reasonable
detail the  individual  items of such Damages  included in the amount so stated,
the date each item was paid, or properly accrued or arose, and the nature of the
misrepresentation,  breach of  warranty,  covenant  or other claim to which such
item is related,  Acquirer  shall,  subject to the provisions of this Section 9,
deliver  a sum of cash  equal  to such  Damages  to the  Stockholders'  Agent as
promptly as practicable.

            (b) Acquirer  shall have thirty (30) days after delivery of an Agent
Certificate to object to any claim or claims made by such Agent Certificate in a
written  statement  delivered to Stockholders'  Agent. In case Acquirer shall so
object in writing to any claim or claims made by the Stockholders'  Agent in the
Agent Certificate, the Stockholders Agent shall have thirty (30) days to respond
in a  written  statement  to the  objection  of  Acquirer  ("Acquirer  Objection
Notice").  If after such 30-day period there remains a dispute as to any claims,
the Stockholders'  Agent and Acquirer shall attempt in good faith for sixty (60)
days from the Acquirer's delivery of the Acquirer Objection Notice to agree upon
the rights of the respective parties with respect to each of such claims. If the
Stockholders'  Agent and Acquirer  should so agree,  a memorandum  setting forth
such agreement shall be prepared and signed by both parties.  Acquirer shall, if
agreed in such  memorandum,  make  payment  for claims or other  disposition  as
agreed in such memorandum and such  performance  shall satisfy all of Acquirer's
obligations as to such claim.

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      9.7. Resolution of Conflicts and Arbitration.

            (a) If no  agreement  can be reached  after  good faith  negotiation
between the parties  pursuant to  Sections  9.5 or 9.6,  either  Acquirer or the
Stockholders'  Agent may, by written notice to the other,  demand arbitration of
the matter  unless the amount of the  Damages at issue is in pending  litigation
with a third party or is subject to a pending  investigation by any Governmental
Entity,  in which event  arbitration shall not be commenced until such amount is
ascertained or both parties agree to  arbitration;  and in either such event the
matter shall be settled by arbitration conducted by one arbitrator. Acquirer and
the Stockholders' Agent shall agree on the arbitrator, provided that if Acquirer
and the Stockholders' Agent cannot agree on such arbitrator,  either Acquirer or
Stockholders' Agent can request that Judicial Arbitration and Mediation Services
("JAMS") select the arbitrator.  The arbitrator  shall set a limited time period
and  establish  procedures  designed  to reduce the cost and time for  discovery
while allowing the parties an opportunity,  adequate in the sole judgment of the
arbitrator, to discover relevant information from the opposing parties about the
subject matter of the dispute.  The arbitrator shall rule upon motions to compel
or limit discovery and shall have the authority to impose  sanctions,  including
attorneys'  fees and costs,  to the same extent as a court of  competent  law or
equity,  should the  arbitrator  determine  that  discovery  was sought  without
substantial  justification  or that discovery was refused or objected to without
substantial  justification.  The  decision of the  arbitrator  shall be written,
shall be in accordance with Applicable Law and with this Agreement, and shall be
supported  by written  findings  of fact and  conclusion  of law which shall set
forth  the  basis  for the  decision  of the  arbitrator.  The  decision  of the
arbitrator  as to the  validity  and  amount  of any  claim  in  such  Officer's
Certificate  or Agent  Certificate  shall be  binding  and  conclusive  upon the
parties to this Agreement,  and notwithstanding  anything in Section hereof, the
Escrow Agent and the parties  shall be entitled to act in  accordance  with such
decision and the Escrow Agent shall be entitled to make or withhold payments out
of the Escrow Fund in accordance therewith.

            (b)  Judgment  upon any  award  rendered  by the  arbitrator  may be
entered in any federal or state court of competent  jurisdiction  located in the
State  of  Calfornia.  Any  such  arbitration  shall  be held in San  Francisco,
California under the commercial rules then in effect of JAMS. The non-prevailing
party to an arbitration shall pay its own expenses,  the fees of the arbitrator,
any administrative fee of JAMS, and the expenses,  including attorneys' fees and
costs,  reasonably incurred by the other party to the arbitration.  For purposes
of this Section 9, in any arbitration hereunder in which any claim or the amount
thereof stated in the Officer's  Certificate or Agent  Certificate,  as the case
may be, is at issue, the party seeking indemnification shall be deemed to be the
non-prevailing   party   unless  the   arbitrators   award  the  party   seeking
indemnification  more than  one-half  (1/2) of the amount in  dispute,  plus any
amounts not in dispute;  otherwise,  the Person against whom  indemnification is
sought shall be deemed to be the non-prevailing party.

      9.8. Stockholders' Agent.

            (a) The approval by the HOVRS Stockholders of the principal terms of
this   Agreement  and  the  Merger   pursuant  to  the  Written   Consent  shall
automatically  and  without  any  further  action  on  the  part  of  any  HOVRS
Stockholder  constitute the irrevocable  appointment of Bill M. McDonagh, as the
agent,  proxy  and  attorney-in-fact  for each of the  HOVRS

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Stockholders  with respect to matters  arising  after the  effectiveness  of the
Merger  and the other  matters  set forth in this  Agreement  and in the  Escrow
Agreement to be performed by the Stockholders' Agent.

            (b) Without  limiting  Section 9.8(a),  the  Stockholders'  Agent is
hereby irrevocably  appointed the agent, proxy and  attorney-in-fact for each of
the  HOVRS  Stockholders  for all  purposes  of this  Agreement  and the  Escrow
Agreement,  including without limitation, full power and authority on such HOVRS
Stockholders' behalf (i) to give and receive notices and communications, (ii) to
authorize  delivery to Acquirer of property from the Escrow Fund in satisfaction
of claims by Acquirer,  (iii) to object to such deliveries,  (iv) to make claims
on behalf of the HOVRS  Stockholders  pursuant  to  Section  9, (v) to agree to,
negotiate, enter into settlements and compromises of, and demand arbitration and
comply  with  orders of courts and awards of  arbitrators  with  respect to such
claims,  (vi) to execute any instrument or document that the Stockholders' Agent
may determine is necessary or desirable in the exercise of his  authority  under
this  Section  9.8 and the  Escrow  Agreement,  and  (vii) to take  all  actions
necessary  or  appropriate  in the judgment of the  Stockholders'  Agent for the
accomplishment  of the  foregoing.  A vacancy in the  position of  Stockholders'
Agent may be filled by the holders of a majority in interest of the Escrow Fund.
No bond shall be  required of the  Stockholders'  Agent,  and the  Stockholders'
Agent shall receive no compensation for his services.  Notices or communications
to or from the  Stockholders'  Agent shall constitute  notice to or from each of
the HOVRS Stockholders.

            (c) The Stockholders'  Agent shall not be liable for any act done or
omitted  hereunder as  Stockholder'  Agent while acting in good faith and in the
exercise  of  reasonable  judgment  and any act done or omitted  pursuant to the
advice  of  counsel  shall  be  conclusive  evidence  of such  good  faith.  The
Stockholders'  Agent  shall  have no duties  or  responsibilities  except  those
expressly set forth in this Agreement or in the Escrow Agreement, and no implied
covenants,  functions,  responsibilities,  duties, obligations or liabilities on
behalf of any HOVRS  Stockholder shall otherwise exist against the Stockholders'
Agent.  The  HOVRS   Stockholders   shall  severally   indemnify  and  hold  the
Stockholders'  Agent harmless  against any loss,  liability or expense  incurred
without gross negligence or bad faith on the part of the Stockholders' Agent and
arising out of or in connection  with the  acceptance or  administration  of his
duties hereunder.

            (d) At the  Closing,  the Holdback  Cash shall be deposited  into an
interest  bearing  account held in the name of the  Stockholders'  Agent for the
benefit  of the  HOVRS  Stockholders.  The  Holdback  Fund  may be  used  at the
discretion  of the  Stockholders'  Agent solely for  reasonable  and  documented
expenses incurred in the administration of his duties under this Section 9.8 and
the Escrow  Agreement.  As soon as  practicable  following the end of the Escrow
Period,  all  funds  remaining  in the  Holdback  Fund  shall  be  released  and
distributed to the HOVRS Stockholders on a pro rata basis in accordance with the
percentages set forth on Schedule I to the Escrow Agreement;  provided, however,
expenses  projected  to be  incurred  in  the  reasonable  determination  of the
Stockholders'  Agent for the  administration  of his duties in  connection  with
claims  unresolved as of the  expiration of the Escrow Period may be retained in
the  Holdback  Fund for such  purpose  following  the  expiration  of the Escrow
Period. In the event the Holdback Fund is insufficient to satisfy the reasonable
out-of-pocket expenses (including attorneys' and accountants' fees and expenses)
incurred  by  the   Stockholders'   Agent  in  serving  in  that  capacity  (the
"Expenses"),  the  Stockholder's  Agent shall have the right to recover from the

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Escrow Fund, prior to any distribution to the HOVRS  Stockholders (but after any
disbursement  from the Escrow  Fund to the Escrow  Agent  pursuant  to terms and
conditions of the Escrow Agreement),  the Stockholder's Agent's Expenses. In the
event the Escrow Fund is insufficient  to satisfy the Expenses,  then each HOVRS
Stockholder  will be obligated to pay a percentage  of the Expenses in excess of
the Escrow Fund  proportionate to such HOVRS  Stockholder's  allocable shares of
the Escrow Fund.

            (e)  The  Stockholders'   Agent  shall  have  reasonable  access  to
information about Acquirer and the reasonable  assistance of Acquirer's officers
and employees for purposes of performing  his duties and  exercising  his rights
hereunder,  provided that the Stockholders' Agent shall treat confidentially and
not disclose any nonpublic  information from or about the Surviving  Corporation
or the  Acquirer to anyone  (except on a need to know basis to  individuals  who
agree to treat such information confidentially).

            (f) Acquirer  acknowledges that the  Stockholders'  Agent may have a
conflict of interest with respect to its duties as  Stockholders'  Agent, and in
such regard the  Stockholders'  Agent has informed  Acquirer that he will act in
the best interests of the HOVRS Stockholders.

      9.9.  Actions of the  Stockholders'  Agent.  A decision,  act,  consent or
instruction of the Stockholders'  Agent shall constitute a decision of all HOVRS
Stockholders  and shall be final,  binding and  conclusive  upon each such HOVRS
Stockholder,  and the Escrow Agent and Acquirer may rely upon any decision, act,
consent or instruction of the  Stockholders'  Agent as being the decision,  act,
consent or  instruction  of each and every such  HOVRS  Stockholder.  The Escrow
Agent and Acquirer are hereby  relieved from any liability to any Person for any
acts done by them in accordance with such decision,  act, consent or instruction
of the Stockholders' Agent.

      9.10.  Third-Party  Claims.  In the  event  Acquirer  becomes  aware  of a
third-party  claim or other event that Acquirer  believes may result in a demand
against the Escrow Fund,  Acquirer shall promptly notify the Stockholders' Agent
of such claim, and the Stockholders' Agent shall be entitled,  at the expense of
the  HOVRS  Stockholders,  to  participate  in any  defense  of  such  claim  or
resolution of such event.  Acquirer  shall not have the right to settle any such
claim or to agree  to any such  resolution  without  the  prior  consent  of the
Stockholders'   Agent,   with  consent  shall  not  be  unreasonably   withheld,
conditioned or delayed.  In the event that the Stockholders' Agent has consented
to any such settlement, the Stockholders' Agent shall have no power or authority
to  object  under  any  provision  of  Section  9 to the  amount of any claim by
Acquirer against the Escrow Fund for indemnity with respect to such settlement.

      9.11. Tax Returns.  Acquirer shall prepare,  or cause to be prepared,  and
file,  or cause to be filed,  all Tax Returns for HOVRS for any taxable  periods
ending on or prior to the Closing Date or  attributable  to the period up to and
including the Closing Date with respect to a taxable period that does not end on
the Closing  Date.  Tax Returns  filed  pursuant to this  Section  9.11 shall be
prepared in a manner consistent with prior tax accounting  practices and methods
used by HOVRS (except to the extent counsel for the Acquirer determines there is
no reasonable basis in law therefor or determines that such Tax Return cannot be
so  prepared  and  filed  or an  item  so  reported  without  being  subject  to
penalties). In the event that the Taxes reflected on such Tax Returns would form
the basis for a claim of  indemnification  pursuant to Section 9.2, the

                                       86
<PAGE>

Acquirer shall provide the portion of such Tax Returns  relevant to HOVRS to the
Stockholders'  Agent for review and  comment at least  thirty (30) days prior to
the due date  for  filing  such Tax  Returns,  and  shall  not file any such Tax
Returns without the consent of the Stockholders'  Agent, which consent shall not
be unreasonably withheld, conditioned or delayed.

      9.12. Tax Treatment of Indemnification  Payments. The parties hereto agree
to treat any indemnity  payment made pursuant to this Section 9 as an adjustment
to the Merger  Consideration  for federal,  state,  local and foreign income tax
purposes unless a contrary treatment is required under applicable law.

10. General Provisions.

      10.1. Notices. All notices and other communications  hereunder shall be in
writing  and shall be deemed  duly  delivered:  (i) upon  receipt  if  delivered
personally;  (ii) three (3) Business  Days after being mailed by  registered  or
certified  mail,  postage  prepaid,  return  receipt  requested;  (iii)  one (1)
Business Day after it is sent by commercial  overnight courier service;  or (iv)
upon  transmission  if sent via facsimile  with  confirmation  of receipt to the
parties at the following  address (or at such other address for a party as shall
be specified upon like notice):

            (a) if to Acquirer to:

                GoAmerica, Inc.
                433 Hackensack Avenue
                Hackensack, NJ  07601
                Attention:  Daniel R. Luis
                Fax:     (201) 996-1772
                Tel:     (201) 996-1717

            with a copy to:

                Chadbourne & Parke LLP
                1200 New Hampshire Avenue, N.W.
                Washington, DC  20036
                Attention:  Dana Frix
                Fax:     (973) 974-679
                Tel:     (202) 974-5691

            (b) if to HOVRS to:

                Hands On Video Relay Services, Inc.
                595 Menlo Drive
                Rocklin, CA 95765-3708
                Attention: Edmond Routhier
                Fax:     (916) 435-0624
                Tel:     (916) 435-3337

                                       87
<PAGE>

            with a copy to:

                Orrick, Herrington & Sutcliffe LLP
                405 Howard Street
                San Francisco, CA 94105
                Attention:  Richard Smith
                Fax:     (415) 773-5759
                Tel:     (415) 773-5830

      10.2.  Counterparts.  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,  it being  understood  that all
parties need not sign the same counterpart.

      10.3.  Entire  Agreement;  Nonassignability;  Parties  in  Interest.  This
Agreement and the documents and  instruments and other  agreements  specifically
referred to herein or  delivered  pursuant  hereto,  including  the exhibits and
schedules  hereto,  including  the HOVRS  Disclosure  Schedule  and the Acquirer
Disclosure  Schedule:  (a) together  constitute the entire  agreement  among the
parties  with  respect to the  subject  matter  hereof and  supersede  all prior
agreements  and  understandings,  both written and oral,  among the parties with
respect to the subject matter hereof except for the  Confidentiality  Agreement,
which shall continue in full force and effect, and shall survive any termination
of this Agreement or the Closing,  in accordance with its terms; and (b) are not
intended to confer upon any other  Person any rights or remedies  hereunder  and
shall not be  assigned  by  operation  of law or  otherwise  without the written
consent of the other party.

      10.4.  Severability.  In the event that any provision of this Agreement or
the  application  thereof  becomes  or  is  declared  by a  court  of  competent
jurisdiction  to be  illegal,  void  or  unenforceable,  the  remainder  of this
Agreement  will  continue in full force and effect and the  application  of such
provision to other persons or circumstances will be interpreted so as reasonably
to effect the intent of the parties hereto. The parties further agree to replace
such  void or  unenforceable  provision  of  this  Agreement  with a  valid  and
enforceable  provision that will achieve, to the extent possible,  the economic,
business and other purposes of such void or unenforceable provision.

      10.5.  Remedies  Cumulative.  Except as otherwise provided herein, any and
all remedies herein expressly  conferred upon a party will be deemed  cumulative
with and not exclusive of any other remedy conferred hereby, or by law or equity
upon such party, and the exercise by a party of any one remedy will not preclude
the exercise of any other remedy.

      10.6.  Governing Law. This Agreement shall be governed by and construed in
accordance  with the internal laws of Delaware,  without  regard to conflicts of
law principles.

      10.7. Rules of Construction.  The parties hereto agree that they have been
represented by counsel during the negotiation, preparation and execution of this
Agreement and, therefore, waive the application of any law, regulation,  holding
or rule of  construction  providing  that

                                       88
<PAGE>

ambiguities  in an agreement  or other  document  will be construed  against the
party drafting such agreement or document.

      10.8.  Enforcement.  Each of the parties  hereto  agrees that  irreparable
damage would occur and that the parties  would not have any  adequate  remedy at
law 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.  Subject to the procedures set forth
in Section 9 herein,  each of the parties  hereto (a) consents to submit  itself
exclusively to the personal  jurisdiction  of any federal or state court located
in the State of California,  wherein venue shall be exclusive, in the event that
any dispute arises out of this Agreement or out of any transaction  contemplated
by this  Agreement,  (b) agrees  that it will not attempt to deny or defeat such
personal  jurisdiction  or venue by motion or other  request  for leave from any
such court,  and (c) agrees  that it will not bring any action  relating to this
Agreement or any of the transactions contemplated by this Agreement in any court
other than a federal or state court sitting in the State of California.

      10.9.  Amendment;  Waiver.  Any amendment or waiver of any of the terms or
conditions of this  Agreement must be in writing and must be duly executed by or
on behalf of the party to be charged with such waiver. The failure of a party to
exercise any of its rights  hereunder or to insist upon strict  adherence to any
term or condition  hereof on any one occasion shall not be construed as a waiver
or deprive that party of the right thereafter to insist upon strict adherence to
the terms and conditions of this Agreement at a later date.  Further,  no waiver
of any of the terms and conditions of this Agreement shall be deemed to or shall
constitute  a waiver of any  other  term of  condition  hereof  (whether  or not
similar).

      10.10.  Attorneys'  Fees. If any court proceeding is brought in connection
with this  Agreement,  or any document,  agreement,  instrument  or  certificate
delivered  under or pursuant to this  Agreement,  the  prevailing  party in such
proceeding (whether at trial or on appeal) shall be entitled to recover from the
other party all costs, expenses and reasonable attorneys' fees incidental to any
such proceeding. The term "prevailing party" as used herein shall mean the party
in  whose  favor a final  judgment  or  award is  entered  in any such  judicial
proceeding;  provided,  however,  that if such proceeding is resolved prior to a
final  judgment or award on the merits,  the party in whose favor the proceeding
is  settled  may  by  motion  may  apply  to  the  court  for  an  award  of the
aforementioned costs, fees and expenses, and may take judgment therefor.

      10.11.  Headings.  The  headings  contained  in  this  Agreement  are  for
convenience of reference only and shall not affect the meaning or interpretation
of this Agreement.

                         [Signatures on following page]

                                       89
<PAGE>
      IN  WITNESS   WHEREOF,   Acquirer,   HOVRS  Merger  Sub,   HOVRS  and  the
Stockholders'  Agent have caused this  Agreement to be executed and delivered by
each of them or their respective  officers thereunto duly authorized,  all as of
the date first written above.

                              GOAMERICA, INC.

                              By:     /s/ Daniel R. Luis
                                 -----------------------------------------------
                                      Daniel R. Luis
                                      President and Chief Executive Officer

                              HOVRS ACQUISITION CORPORATION

                              By:     /s/ Daniel R. Luis
                                 -----------------------------------------------
                                      Daniel R. Luis
                                      President and Chief Executive Officer

                              HANDS ON VIDEO RELAY SERVICES, INC.

                              By:     /s/ Edmond Routhier
                                 -----------------------------------------------
                                      Edmond Routhier
                                      President

                              BILL M. McDONAGH,
                              as Stockholders' Agent

                              /s/ Bill M. McDonagh
                              --------------------------------------------------
                              Bill M. McDonagh

                [Signature page to Agreement and Plan of Merger]

                                       90
<PAGE>

                             [GoAmerica letterhead]

                               September 17, 2007

Mr. Edmond Routhier
President
Hands On Video Relay Services, Inc.
590 Menlo Drive
Rocklin, CA 95765-3708

      Re:   Agreement  with  Regard  to HOVRS  Unvested  Options  (this  "Letter
            Agreement")
            --------------------------------------------------------------------

Dear Ed:

      Reference  is made to  Section  2.6(d)(ii)  of the  Agreement  and Plan of
Merger dated September 12, 2007 (the "Merger Agreement") by and among GoAmerica,
Inc., a Delaware corporation ("GoAmerica"), the HOVRS Acquisition Corporation, a
Delaware  corporation and wholly owned  subsidiary of GoAmerica,  Hands On Video
Relay Services,  Inc., a Delaware corporation ("Hands On"), and Bill M. McDonagh
as  stockholders'  agent,  which  provides that at the Effective  Time GoAmerica
shall  assume each HOVRS  Stock  Option  that is  outstanding  and not vested in
accordance with its terms  immediately prior to the Closing (the "HOVRS Unvested
Options") together with the option agreement  representing each such HOVRS Stock
Option (each, an "Assumed HOVRS Option"). Capitalized terms used but not defined
herein shall have the meaning set forth in the Merger Agreement.

      Notwithstanding anything to the contrary set forth in the Merger Agreement
or the  HOVRS  Disclosure  Schedule,  including  Section  3.5(b)  of  the  HOVRS
Disclosure  Schedule,  Hands On hereby agrees and  acknowledges  that, as of the
Effective  Time, the maximum number of outstanding  HOVRS Unvested  Options that
GoAmerica  will be required to assume under the terms of Section  2.6(d)(ii)  of
the Merger  Agreement is two hundred  twenty  thousand,  four hundred and ninety
eight  (220,498)  shares as Assumed HOVRS  Options (the  "Maximum  Assumed HOVRS
Options"),  and that in the event  there is a greater  number of HOVRS  Unvested
Options outstanding as of the Closing,  Hands On hereby agrees to accelerate the
vesting of such excess HOVRS Unvested Options so that such excess HOVRS Unvested
Options shall for all purposes be HOVRS Vested  Options under the  provisions of
Section  2.6(d)(i) of the Merger  Agreement;  provided,  however,  the foregoing
shall in no way alter or amend  the  provisions  of  Section  5.1(d)(iii)  which
provides  that,  with the  permission  of Acquirer,  HOVRS may grant  options to
purchase HOVRS Common Stock following the date of the Merger Agreement  pursuant
to the HOVRS  Option  Plan or  otherwise  to  persons  retained  by HOVRS in the
ordinary course of business as employees after the date of the Merger Agreement,
which options shall not be counted toward the Maximum  Assumed HOVRS Options and
be treated as Assumed HOVRS Options for all purposes under the Merger Agreement.

<PAGE>

      Except as expressly set forth above in this Letter  Agreement,  the Merger
Agreement  shall  remain  unmodified  and in full force and effect.  This Letter
Agreement  shall be governed by and  construed  in  accordance  with the laws of
Delaware, without regard to conflicts of law principles.

      If the foregoing reflects our agreement,  I would be grateful if you would
acknowledge below.

                                     Very truly yours,

                                     GOAMERICA, INC.

                                     By: /s/ Daniel R. Luis
                                         ---------------------------------------
                                         Daniel R. Luis, Chief Executive Officer

HANDS ON VIDEO RELAY SERVICES, INC.

By: /s/ Edmond Routhier
    --------------------------
    Edmond Routhier, President

Date: September 17, 2007Exhibit 10.2

                                                               Execution Version

                          SUPPORT AND LOCK-UP AGREEMENT

      This SUPPORT AND LOCK-UP  AGREEMENT (this  "Agreement") is entered into as
of September 12, 2007, by and among GoAmerica, Inc., a Delaware corporation (the
"Acquirer"),  and the  stockholders  of Hands On Video Relay  Services,  Inc., a
Delaware corporation ("HOVRS"), identified on the signature pages hereto (each a
"Stockholder," and collectively, the "Stockholders").

                                    RECITALS

      A.  Reference is hereby made to that certain  Agreement and Plan of Merger
dated as of  September  12,  2007 (as it may be amended  from time to time,  the
"Merger Agreement"),  by and among Acquirer,  HOVRS Acquisition  Corporation,  a
Delaware  corporation  and wholly owned  subsidiary of Acquirer  ("HOVRS  Merger
Sub"),  and HOVRS,  pursuant to which,  and subject to the terms and  conditions
whereof,  (i) HOVRS  Merger Sub will merge with and into HOVRS and the  separate
corporate  existence  of HOVRS  Merger Sub will cease,  (ii) each share of HOVRS
Common  Stock  will be  converted  into the right to receive  the Common  Merger
Consideration, and (iii) each share HOVRS Preferred Stock will be converted into
the right to receive the Preferred Merger  Consideration  (such transactions are
referred to herein as the "Merger").

      B. As a condition to the  willingness of Acquirer to enter into the Merger
Agreement,  Acquirer has requested that the other parties hereto enter into this
Agreement,  and such parties are willing to enter into this  Agreement  for such
purpose.

                                    AGREEMENT

      NOW, THEREFORE,  in consideration of the mutual promises herein contained,
and intending to be legally bound, the parties hereto agree as follows:

      1. Defined Terms.  Capitalized terms used herein without  definition shall
have the same  meanings  as they are  given  in the  Merger  Agreement.  As used
herein,  the term "Shares"  shall mean,  with respect to each  Stockholder,  all
shares of HOVRS Common Stock and HOVRS  Preferred  Stock set forth  opposite the
name of such Stockholder on Schedule I hereto,  and any other voting  securities
of HOVRS,  whether issued before or after the date of this Agreement,  that such
Stockholder  purchases  or with  respect  to which  such  Stockholder  otherwise
acquires record or beneficial ownership after the date of this Agreement.

      2. Conduct of Stockholders  Pending  Closing.  Until the time specified in
paragraph  4  below,  and  except  for all  agreements  and  obligations  of the
Stockholders  hereunder  and as  contemplated  by the Merger  Agreement,  unless
authorized in advance by the HOVRS Board of Directors and by the Acquirer  Board
of  Directors,  each  Stockholder,  solely in its capacity as a  stockholder  of
HOVRS,  agrees (a) not to sell or  otherwise  transfer  any of its Shares or any
economic,  voting or other direct or indirect interest therein, (b) not to grant
a proxy or enter into any voting agreement concerning any of the Shares, and (c)
at any meeting of the  stockholders of HOVRS, to vote (or cause to be voted) the
Shares against (x) any merger agreement or merger,

<PAGE>

consolidation,  combination,  sale  of  substantial  assets,  reorganization  or
recapitalization of or by HOVRS or any of its subsidiaries (except in connection
with the Merger),  or (y) any amendment of HOVRS's  certificate of incorporation
or  bylaws  or  other  proposal  or  transaction  involving  HOVRS or any of its
subsidiaries  (except  in  connection  with  the  Merger),  for the  purpose  of
impeding, frustrating, preventing or nullifying the Merger Agreement, the Merger
or any of the other transactions contemplated by the Merger Agreement.

      3.  Representations  and  Warranties.  Each  of  the  Stockholders  hereby
represents and warrants to HOVRS and Acquirer that: (a) such Stockholder has the
power and  authority  to enter into and deliver this  Agreement  and perform its
obligations under this Agreement and, such Stockholder's  execution and delivery
of this Agreement and  performance of its  obligations  hereunder have been duly
and validly authorized by any necessary  corporate or similar proceedings on the
part of such Stockholder,  (b) this Agreement is binding on such Stockholder and
enforceable  in  accordance  with its  terms,  except as  enforceability  may be
limited  by  applicable  bankruptcy,  insolvency,  reorganization,   moratorium,
fraudulent  conveyance  or other  similar  laws  affecting  the  enforcement  of
creditors'  rights  generally  or by general  equitable  principles  relating to
enforceability,  (c)  the  execution  and  delivery  of this  Agreement  and the
performance by such Stockholder of its obligations  hereunder do not require the
authorization,  consent,  approval,  license,  exemption  or other action by, or
filing  with,  any  third  party  or  governmental  authority,  do  not  violate
applicable  law  or  conflict  with  or  result  in a  breach  of  any  of  such
Stockholder's  organizational  documents or  contractual  obligations,  (d) such
Stockholder  owns the  Shares  that are  identified  as to such  Stockholder  on
Schedule  I to this  Agreement  and that such  Shares  are free and clear of any
liens,  claims  or  encumbrances  of any  kind  apart  from  such  Stockholder's
obligations  under  this  Agreement,  and (e)  other  than the  Shares  that are
identified  as to  such  Stockholder  on  Schedule  I to  this  Agreement,  such
Stockholder does not own  (beneficially  or of record) any voting  securities of
HOVRS.

      4. Termination.  The obligations of the Stockholders  under this Agreement
shall  terminate  upon the  earliest to occur of any of the  following:  (i) the
Merger Agreement is amended or modified or provisions waived,  without the prior
written consent of the Stockholders,  in a manner that is materially  adverse to
the  Stockholders,  it  being  understood  that  any  amendment,   modification,
supplement  or  waiver  that  would  reduce  the  amount  or form of the  Merger
Consideration  payable in the Merger or extend the Outside  Date shall be deemed
to be materially adverse to the Stockholders,  (ii) the Merger Agreement,  as it
may be amended or modified from time to time,  is terminated in accordance  with
its terms,  (iii) the consummation of the Merger,  or (iv) the written agreement
to terminate such provisions executed by each of the parties.

      5.  Notice.  All notices and other  communications  hereunder  shall be in
writing  and shall be deemed  duly  delivered:  (i) upon  receipt  if  delivered
personally;  (ii)  three  business  days after  being  mailed by  registered  or
certified mail, postage prepaid,  return receipt  requested;  (iii) one business
day  after it is sent by  commercial  overnight  courier  service;  or (iv) upon
transmission  if sent via facsimile with  confirmation of receipt to the parties
at the  following  address  (or at such  other  address  for a party as shall be
specified upon like notice):

                                      -2-
<PAGE>

                  if to Acquirer to:

                        GoAmerica, Inc.
                        433 Hackensack Avenue
                        Hackensack, NJ  07601
                        Attention:  Daniel R. Luis
                        Fax:     (201) 996-1772
                        Tel:     (201) 996-1717

                  with a copy to:

                        Chadbourne & Parke LLP
                        1200 New Hampshire Avenue, N.W.
                        Washington, DC  20036
                        Attention:  Dana Frix
                        Fax:     (973) 974-679
                        Tel:     (202) 974-5691

                  If to any Stockholder,

                        to the address set forth below such
                        Stockholder's name on Schedule I hereto.

                  with a copy to:

                        Orrick, Herrington & Sutcliffe LLP
                        405 Howard Street
                        San Francisco, CA 94105
                        Attention:  Richard Smith
                        Fax:     (415) 773-5759
                        Tel:     (415) 773-5830

      6.  Entire  Agreement.  This  Agreement  supersedes  all prior  agreements
between  the  parties  with  respect to its  subject  matter and  constitutes  a
complete  and  exclusive  statement  of the terms of the  agreement  between the
parties with respect to its subject matter.

      7. No Other Rights.  Nothing in this Agreement shall be considered to give
any person other than the parties any legal or equitable right,  claim or remedy
under or in respect of this Agreement or any provision of this  Agreement.  This
Agreement and all of its  provisions  are for the sole and exclusive  benefit of
the parties and their respective successors and permitted assigns.

      8. Equitable Relief. Each of the parties hereto acknowledges that a breach
by it of any provision  contained in this Agreement will cause the other parties
to sustain damage for

                                      -3-
<PAGE>

which  they  would not have an  adequate  remedy at law for money  damages,  and
therefore  each of the  parties  hereto  agrees  that in the  event  of any such
breach,  the  aggrieved  party  shall be  entitled  to the  remedy  of  specific
performance  of such  agreement and  injunctive  and other  equitable  relief in
addition to any other remedy to which it may be entitled, at law or in equity.

      9.  Severability.  If any  provision of this  Agreement is held invalid or
unenforceable by a court of competent jurisdiction, the other provisions of this
Agreement shall remain in full force and effect. Any provision of this Agreement
which is held invalid or  unenforceable  only in part shall remain in full force
and effect to the extent not held invalid or unenforceable.

      10.  Headings.   All  references  in  this  Agreement  to  "paragraph"  or
"paragraphs" refer to the corresponding numbered paragraph or paragraphs of this
Agreement.  All words used in this  Agreement  shall be  construed  to be of the
appropriate gender or number as the context requires. Unless otherwise expressly
provided, the word "including" does not limit the preceding words or terms.

      11.  Counterparts.   This  Agreement  may  be  executed  in  one  or  more
counterparts,  each of  which  shall  be  considered  an  original  copy of this
Agreement  and all of  which,  when  taken  together,  shall  be  considered  to
constitute one and the same agreement.

      12.  Governing Law. This  Agreement  shall be governed by and construed in
accordance with the laws of the State of Delaware without regard to that state's
conflicts of laws principles.

      13.  Amendments;  Waivers.  Any  amendment  or  modification  of or to any
provision of this Agreement,  and any consent to any departure of any party from
the terms of any provision of this  Agreement,  shall be effective only if it is
made or given in writing and signed by each party. Notwithstanding the foregoing
sentence,  any  failure  of any of the  parties to comply  with any  obligation,
covenant,  agreement or condition  herein may be waived by any party entitled to
the benefits thereof only by a written  instrument signed by such party granting
such waiver,  but such waiver or failure to insist upon strict  compliance  with
such obligation,  covenant, agreement or condition shall not operate as a waiver
of, or estoppel with respect to, any subsequent or other failure. The failure of
any party to assert any of its rights under this  Agreement  or otherwise  shall
not constitute a waiver of those rights.

      14.  Successors and Assigns.  This Agreement shall apply to, be binding in
all respects  upon and inure to the benefit of the parties and their  respective
successors  and permitted  assigns.  No party may assign any of its rights under
this Agreement without the prior written consent of each of the other parties.

                         [Signatures on following pages]

                                      -4-
<PAGE>

      IN WITNESS  WHEREOF,  the parties  have caused this  Agreement  to be duly
executed as of the date first above written.

                                 GOAMERICA, INC.

                                 By:  /s/ Daniel R. Luis
                                    --------------------------------------------
                                      Daniel R. Luis
                                      President and Chief Executive Officer

                                 STOCKHOLDERS:

                                      /s/ Ronald Obray
                                    --------------------------------------------
                                      Ronald Obray

                                      /s/ Denise Obray
                                    --------------------------------------------
                                      Denise Obray

                                      /s/ Edmond Routhier
                                    --------------------------------------------
                                      Edmond Routhier

                                 Caymus Investment Group II, LLC

                                 By:  /s/ Edmond Routhier
                                     -------------------------------------------

                                 Its: Managing Member
                                     -------------------------------------------

                                 Caymus Obray, LLC

                                 By:  /s/ Edmond Routhier
                                     -------------------------------------------

                                 Its: Managing Member
                                     -------------------------------------------

                 [Signature page to Support & Lock-Up Agreement]

                                      -5-
<PAGE>

                                   Schedule I

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
            Name and Address of Stockholder                    Common Stock             Series A Preferred
            -------------------------------                    ------------             ------------------
-------------------------------------------------------------------------------------------------------------
<S>                                                              <C>                         <C>
  Denise Obray                                                  2,464,921
  132 Lincoln Way
  Auburn, CA 95603
  Facsimile: (530) 823-0897
-------------------------------------------------------------------------------------------------------------
  Ronald Obray                                                  2,288,222
  132 Lincoln Way
  Auburn, CA 95603
  Facsimile: (530) 823-0897
-------------------------------------------------------------------------------------------------------------
  Edmond Routhier                                               1,094,455
  525 Michael Dr.
  Sonoma, CA 95476
  Facsimile:  (707) 221-1471
-------------------------------------------------------------------------------------------------------------
  Caymus Investment Group II, LLC                                476,700                     1,724,138
  2800 Leavenworth, Ste. #70
  San Francisco, CA 94133
  Facsimile:
-------------------------------------------------------------------------------------------------------------
  Caymus Obray, LLC                                              540,157
  2800 Leavenworth, Ste. #70
  San Francisco, CA 94133
  Facsimile:
-------------------------------------------------------------------------------------------------------------
  TOTAL                                                         6,864,455                    1,724,138
-------------------------------------------------------------------------------------------------------------
</TABLE>

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