Document:

Exhibit 10.1

                          AGREEMENT AND PLAN OF MERGER

                                  BY AND AMONG

                              PLATO LEARNING, INC.

                          WILC ACQUISITION CORPORATION

                                       AND

                    WASATCH INTERACTIVE LEARNING CORPORATION

                          DATED AS OF JANUARY 31, 2001

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                                TABLE OF CONTENTS

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ARTICLE I THE MERGER; EFFECTIVE TIME; CLOSING...............   1
  1.1 The Merger............................................   1
  1.2 Closing...............................................   1
  1.3 Effective Time........................................   1
  1.4 Effect of the Merger..................................   2
ARTICLE II CERTIFICATE OF INCORPORATION AND BY-LAWS OF THE
  SURVIVING CORPORATION.....................................   2
  2.1 Certificate of Incorporation; Name....................   2
  2.2 Bylaws................................................   2
ARTICLE III DIRECTORS AND OFFICERS OF THE SURVIVING
  CORPORATION AND PARENT....................................   2
  3.1 Directors of the Surviving Corporation................   2
  3.2 Officers of the Surviving Corporation.................   2
ARTICLE IV MERGER CONSIDERATION; CONVERSION OR CANCELLATION
  OF SHARES IN THE MERGER...................................   2
  4.1 Share Consideration for the Merger; Conversion or
     Cancellation of Shares in the Merger...................   2
  4.2 Payment for Shares in the Merger......................   3
  4.3 Cash For Fractional Parent Shares.....................   5
  4.4 Transfer of Shares after the Effective Time...........   5
  4.5 Investment of the Stock Merger Exchange Fund and
     Fractional Securities Fund.............................   5
  4.6 Lost Certificates.....................................   5
  4.7 Further Assurances....................................   6
  4.8 Appraisal Rights......................................   6
ARTICLE V REPRESENTATIONS AND WARRANTIES....................   6
  5.1 Representations and Warranties of the Company.........   6
  5.2 Representations and Warranties of Parent and Merger
     Sub....................................................  20
ARTICLE VI ADDITIONAL COVENANTS AND AGREEMENTS..............  27
  6.1 Conduct of Business of the Company....................  27
  6.2 No Solicitation.......................................  29
  6.3 Company Stockholders Meeting..........................  31
  6.4 S-3 Registration Statement and S-4 Registration
     Statement; Proxy Statement.............................  31
  6.5 Listing Application...................................  31
  6.6 Access to Information.................................  31
  6.7 Publicity.............................................  31
  6.8 Indemnification of Directors and Officers.............  32
  6.9 Affiliates............................................  32
  6.10 Maintenance of Insurance.............................  32
  6.11 Representations and Warranties.......................  33
  6.12 Filings; Reasonable Best Efforts to Consummate
     Transactions...........................................  33
  6.13 Tax-Free Reorganization Treatment....................  33
  6.14 Company Options......................................  33
  6.15 Accountant's Comfort Letters.........................  33
  6.16 Debentures...........................................  33
  6.17 Employee Benefits....................................  34
  6.18 Company Warrants.....................................  34
  6.19 Voting Agreement.....................................  34

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  6.20 Business of Parent Pending Closing................... 34
  6.21 Fairness Opinion..................................... 34
ARTICLE VII CONDITIONS...................................... 35
  7.1 Conditions to Each Party's Obligations................ 35
  7.2 Additional Conditions to the Obligations of the
     Company................................................ 35
  7.3 Additional Conditions to the Obligations of Parent.... 36
ARTICLE VIII TERMINATION.................................... 37
  8.1 Termination by Mutual Consent......................... 37
  8.2 Termination by either the Company or Parent........... 37
  8.3 Termination by the Company............................ 37
  8.4 Termination by Parent................................. 37
  8.5 Effect of Termination; Termination Fee................ 38
ARTICLE IX MISCELLANEOUS AND GENERAL........................ 39
  9.1 Payment of Expenses................................... 39
  9.2 Non-Survival of Representations and Warranties........ 39
  9.3 Modification or Amendment............................. 39
  9.4 Waiver of Conditions.................................. 39
  9.5 Counterparts.......................................... 39
  9.6 Governing Law......................................... 39
  9.7 Notices............................................... 39
  9.8 Entire Agreement; Assignment.......................... 40
  9.9 Parties in Interest................................... 40
  9.10 Certain Definitions.................................. 40
  9.11 Obligations of Subsidiary............................ 41
  9.12 Severability......................................... 41
  9.13 Specific Performance................................. 42
  9.14 Trial by Jury........................................ 42
  9.15 Captions............................................. 42

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                            GLOSSARY OF DEFINED TERMS

Acquisition Proposal........................................ Section 6.2(f)(i)
Agreement................................................... Introduction
Authorized Representatives.................................. Section 6.6
Certificates of Merger...................................... Section 1.3
Certificates................................................ Section 4.2(b)
Closing..................................................... Section 1.2
Closing Date................................................ Section 1.2
COBRA....................................................... Section
                                                                5.1(m)(iii)(7)
Code........................................................ Recitals
Company..................................................... Introduction
Company Acquisition Transaction............................. Section 6.2(f)(ii)
Company Affiliates.......................................... Section 6.9
Company Disclosure Schedule................................. Section 5.1
Company Financial Advisor................................... Section 6.21
Company Financial Statements................................ Section 5.1(h)(ii)
Company Intellectual Property Rights........................ Section 5.1(n)(xii)
Company Material Contract................................... Section 5.1(o)
Company Option.............................................. Section 5.1(b)
Company Option Plans........................................ Section 5.1(b)
Company Owned Software...................................... Section 5.1(n)(xi)
Company SEC Reports......................................... Section 5.1(h)(i)
Company Scheduled Plan...................................... Section 5.1(m)(i)
Company Shares.............................................. Section 4.1(a)
Company Stockholder Approval................................ Section 6.3
Company Stockholder Meeting................................. Section 6.3
Company Termination Fee..................................... Section 8.5(b)
Company Warrant Agreements.................................. Section 4.1(d)
Company Warrants............................................ Section 4.1(d)
Debentures.................................................. Section 9.10(a)
Debenture Warrants.......................................... Section 9.10(b)
Delaware Certificate of Merger.............................. Section 1.3
DGCL........................................................ Section 1.1
Dissenting Stockholders..................................... Section 4.8
Effective Time.............................................. Section 1.3
Environmental Costs and Liabilities......................... Section 5.1(q)
Environmental Laws.......................................... Section 5.1(q)
ERISA....................................................... Section 9.10(c)
Exchange Act................................................ Section 5.1(f)
Exchange Agent.............................................. Section 4.2(a)
Exchange Ratio.............................................. Section 4.1(a)
Fractional Securities Fund.................................. Section 4.3
GAAP........................................................ Recitals
Governmental Entity......................................... Section 9.10(d)
Hazardous Material.......................................... Section 5.1(q)
HSR Act..................................................... Section 5.1(f)
Indemnified Party........................................... Section 6.8(a)
Knowledge................................................... Section 9.10(e)
Lock-Up Agreement........................................... Section 7.3(g)
Material Adverse Effect..................................... Section 9.10(f)
Merger...................................................... Recitals

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Merger Consideration........................................ Section 4.2(a)
Merger Sub.................................................. Introduction
NASDAQ...................................................... Section 6.5
Necessary Authorizations.................................... Section 5.1(t)
NFCC........................................................ Section 6.1(b)(ii)
OTC......................................................... Section 5.1(p)
Parent...................................................... Introduction
Parent Disclosure Schedule.................................. Section 5.2
Parent Financial Statements................................. Section 5.2(g)(ii)
Parent Intellectual Property Rights......................... Section 5.2(xi)
Parent Owned Software....................................... Section 5.2(n)(x)
Parent SEC Reports.......................................... Section 5.2(g)(i)
Parent Shares............................................... Section 4.1(a)
Parent Share Market Value................................... Section 9.10(g)
Parent Termination Fee...................................... Section 8.5(c)
Parties..................................................... Introduction
PBGC........................................................ Section 5.1(m)(ii)
Person...................................................... Section 9.10(h)
Plan Affiliate.............................................. Section 9.10(i)
Proxy Statement............................................. Section 6.4
Registration Statements..................................... Section 5.1(k)
Representative.............................................. Section 6.2(b)
Restraints.................................................. Section 7.1(c)
Returns..................................................... Section 5.1(m)(i)
S-3 Registration Statement.................................. Section 6.4
S-4 Registration Statement.................................. Section 6.4
SEC......................................................... Section 4.8
Securities Act.............................................. Section 5.1(f)(i)
Significant Tax Agreement................................... Section 9.10(j)
Software.................................................... Section 9.10(k)
Stock Merger Exchange Fund.................................. Section 4.2(a)
Subsidiary.................................................. Section 9.10(l)
Substitute Warrants......................................... Section 4.1(d)
Superior Proposal........................................... Section 6.2(f)(iii)
Surviving Corporation....................................... Section 1.1
Tax......................................................... Section 9.10(m)
Taxes....................................................... Section 9.10(m)
Termination Fee............................................. Section 8.5(b)
Third Party................................................. Section 6.2(b)
Voting Agreement............................................ Recitals
Washington Certificate of Merger............................ Section 1.3
WCBA........................................................ Section 1.1

                                    EXHIBITS

Form of Voting Agreement.................................... Exhibit A
By-laws of the Surviving Corporation........................ Exhibit B
Form of Employment Agreement -- Morris...................... Exhibit C
Form of Employment Agreement -- Loomis...................... Exhibit D
Form of Lock-Up Agreement................................... Exhibit E

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                          AGREEMENT AND PLAN OF MERGER

     AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of January 31,
2001, by and among PLATO LEARNING, INC., a Delaware corporation ("Parent"), WILC
ACQUISITION CORPORATION, a Delaware corporation and a wholly-owned subsidiary of
Parent ("Merger Sub"), and WASATCH INTERACTIVE LEARNING CORPORATION, a
Washington corporation (the "Company"). Parent, Merger Sub and the Company are
referred to collectively herein as the "Parties".

                                    RECITALS

     WHEREAS, the Board of Directors of each of Parent and the Company have
determined that it is in the best interests of each corporation and their
respective stockholders that the parties consummate the business combination
transaction provided for herein in which Merger Sub will merge with and into the
Company (the "Merger") and, in furtherance thereof, have approved this
Agreement, the Merger and the transactions contemplated by this Agreement and
declared the Merger advisable;

     WHEREAS, pursuant to the Merger, the issued and outstanding shares of
common stock of the Company shall be converted into shares of common stock of
Parent at the rate determined herein;

     WHEREAS, for federal income tax purposes, it is intended that the Merger
shall qualify as a reorganization within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code"), and the regulations
promulgated thereunder; and

     WHEREAS, in connection with and immediately prior to the execution and
delivery of this Agreement, and as a condition to Parent's willingness to enter
into this Agreement, certain holders of Company Shares (as hereafter defined)
are each entering into a stockholder voting agreement in the form attached as
Exhibit A hereto (the "Voting Agreement").

     NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants and agreements set forth herein, the Parties hereby agree as follows:

                                    ARTICLE I

                       THE MERGER; EFFECTIVE TIME; CLOSING

     1.1 The Merger. Upon the terms and subject to the conditions set forth in
this Agreement, and in accordance with the Delaware General Corporation Law, as
amended (the "DGCL"), and the Washington Business Corporation Act, as amended
(the "WBCA"), at the Effective Time, Merger Sub shall be merged with and into
the Company, the separate corporate existence of Merger Sub shall thereupon
cease and the Company shall continue as the surviving corporation and shall
succeed to and assume all the rights and obligations of Merger Sub in accordance
with the DGCL and the WBCA. The Company, as the surviving corporation after the
consummation of the Merger, is sometimes hereinafter referred to as the
"Surviving Corporation."

     1.2 Closing. Unless this Agreement shall have been terminated and the
transactions contemplated herein shall have been abandoned pursuant to Article
VIII, the closing of the Merger (the "Closing") shall take place at 10:00 a.m.,
local time, at the offices of Winston & Strawn, 35 W. Wacker Drive, Chicago,
Illinois, on the first business day after all of the conditions (excluding
conditions that, by their nature, cannot be satisfied until the Closing Date) to
the obligations of the Parties to consummate the Merger as set forth in Article
VII have been satisfied or waived (subject to applicable law), or such other
date, time or place as is agreed to in writing by the Parties (the actual time
and date of the Closing being referred to herein as, the "Closing Date").

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     1.3 Effective Time. Subject to the provisions of this Agreement, the
Parties shall cause the Merger to be consummated on the close of business on the
Closing Date by filing (i) the certificate of merger of Merger Sub and the
Company with the Secretary of State of the State of Delaware (the "Delaware
Certificate of Merger") in such form as required by, and executed in accordance
with, the relevant provisions of the DGLC and (ii) the articles of merger of
Merger Sub and the Company with the Secretary of State of the State of
Washington (the "Washington Certificate of Merger," and together with the
Delaware Certificate of Merger, the "Certificate of Mergers") in such form as
required by, and executed in accordance with, the relevant provisions of the
WBCA, each as soon as practicable on or before the Closing Date. The Merger
shall become effective at the close of business on the Closing Date or, if
later, such time as the Certificate of Mergers are duly filed with the Secretary
of State of Delaware and the Secretary of State of the State of Washington, as
the case may be, or at such subsequent date or time as the Parties shall agree
and specify in the Certificate of Mergers (the date and time the Merger becomes
effective being hereinafter referred to as the "Effective Time").

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

                                   ARTICLE II

                        CERTIFICATE OF INCORPORATION AND
                      BY-LAWS OF THE SURVIVING CORPORATION

     2.1 Certificate of Incorporation; Name. At and after the Effective Time,
the articles of incorporation of the Merger Sub shall be the articles of
incorporation of the Surviving Corporation until thereafter changed or amended
as provided therein or by applicable law.

     2.2 Bylaws. At the Effective Time, the bylaws of 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 by
applicable law.

                                   ARTICLE III

         DIRECTORS AND OFFICERS OF THE SURVIVING CORPORATION AND PARENT

     3.1 Directors of the Surviving Corporation. From and after the Effective
Time, until successors are duly elected or appointed and qualified in accordance
with applicable law, the directors of Merger Sub as of the Effective Time will
be the directors of the Surviving Corporation.

     3.2 Officers of the Surviving Corporation. From and after the Effective
Time, until successors are duly elected or appointed and qualified in accordance
with applicable law, the officers of the Merger Sub as of the Effective Time
will be the officers of the Surviving Corporation.

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                                   ARTICLE IV

    MERGER CONSIDERATION; CONVERSION OR CANCELLATION OF SHARES IN THE MERGER

     4.1 Share Consideration for the Merger; Conversion or Cancellation of
Shares in the Merger. At the Effective Time, the manner of converting or
canceling shares of the Company and Parent shall be as follows:

          (a) Conversion of Company Stock. Each share of common stock, $0.0001
     par value of the Company ("Company Shares") issued and outstanding
     immediately prior to the Effective Time (excluding any Company Shares
     described in Section 4.1(b)), shall, by virtue of the Merger and without
     any action on the part of the holder thereof, be converted automatically
     into the right to receive an aggregate amount (the "Exchange Ratio") of
     validly issued, fully paid and non-assessable shares of common stock, $0.01
     par value, of Parent (collectively, "Parent Shares") equal to (i) (A)
     12,000,000 divided by (B) the Parent Share Market Value (as hereafter
     defined) divided by (ii) the aggregate number of issued and outstanding
     Company Shares immediately prior to the Effective Time; provided, that
     fractional Parent Shares shall be paid for in accordance with this Section
     4.1(a) and Section 4.3. All Company Shares to be converted into Parent
     Shares pursuant to this Section 4.1(a) shall, by virtue of the Merger and
     without any action on the part of the holders thereof, cease to be
     outstanding, be canceled and cease to exist, and each holder of a
     certificate representing any such Company Shares shall thereafter cease to
     have any rights with respect to such Company Shares, except the right to
     receive for each of the Company Shares, upon the surrender of such
     certificate in accordance with Section 4.2, the number of Parent Shares
     specified above and cash in lieu of fractional shares in accordance with
     the further provisions contained in Section 4.3.

          (b) Cancellation of Parent Owned and Treasury Stock. All of the
     Company Shares that are owned by Parent, any direct or indirect
     wholly-owned subsidiary of Parent or by the Company as treasury stock
     shall, by virtue of the Merger, cease to be outstanding and shall be
     canceled and retired and no Parent Shares or other consideration shall be
     delivered in exchange therefor.

          (c) Stock of Merger Sub. Each share of common stock, $0.01 par value,
     of Merger Sub issued and outstanding immediately prior to the Effective
     Time, shall, by virtue of the Merger and without any action on the part of
     the holder thereof, be converted automatically into and exchanged for one
     (1) validly issued, fully paid and nonassessable share of common stock,
     $0.01 par value, of the Surviving Corporation. Each stock certificate
     representing any shares of Merger Sub shall continue to represent ownership
     of such shares of capital stock of the Surviving Corporation.

          (d) Outstanding Warrants. Each outstanding warrant to purchase Company
     Shares (each, a "Company Warrant") prior to the Effective Time and which
     remains outstanding immediately prior to the Effective Time shall cease to
     represent a right to acquire Company Shares and shall be converted
     automatically, at the Effective Time (in accordance with the further
     provisions contained in Section 6.19), into and represent a warrant to
     purchase, on the same terms and conditions as were applicable under the
     Company Warrant (taking into account any changes thereto), Parent Shares
     ("Substitute Warrants"), and Parent shall assume each such Substitute
     Warrant subject to the terms of the agreements evidencing grants thereunder
     (the "Company Warrant Agreements"), provided, however, that from and after
     the Effective Time: (i) the number of Parent Shares purchasable upon
     exercise of the Substitute Warrant shall be equal to the number of Parent
     Shares that were purchasable under the Substitute Warrant immediately prior
     to the Effective Time multiplied by the Exchange Ratio, rounded down to the
     nearest whole share, and (ii) the per share exercise price under each
     Substitute Warrant shall be

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     adjusted by dividing the per share exercise price of each Substitute
     Warrant by the Exchange Ratio, rounded up to the nearest cent. The terms of
     each Substitute Warrant shall, in accordance with its terms, be subject to
     further adjustment as appropriate to reflect any stock split, stock
     dividend, recapitalization or other similar transaction with respect to
     Parent Shares subsequent to the Effective Time.

          (e) Certain Adjustments. If, between the date of this Agreement and
     the Effective Time, the outstanding Company Shares or Parent Shares shall
     have been changed into a different number of shares or different class by
     reason of any reclassification, recapitalization, stock split, split-up,
     combination or exchange of shares or a stock dividend or dividend payable
     in any other securities shall be declared with a record date within such
     period, or any similar event shall have occurred, the Exchange Ratio shall
     be appropriately adjusted to provide to the holders of Company Shares the
     same economic effect as contemplated by this Agreement prior to such event.

     4.2  Payment for Shares in the Merger.  The manner of making payment for
Shares in the Merger shall be as follows:

          (a) Exchange Agent. On or prior to the Closing Date, Parent shall
     appoint a commercial bank or trust company having net capital of not less
     than $300,000,000 or a wholly-owned subsidiary thereof to act as exchange
     agent (the "Exchange Agent") hereunder for the purposes of exchanging
     certificates for Company Shares. At or prior to the Effective Date, Parent
     shall deposit with the Exchange Agent in trust for the benefit of the
     holders of Company Shares, a sufficient number of certificates representing
     the Parent Shares required to effect the delivery of the aggregate
     consideration in Parent Shares and cash for the fractional Parent Shares
     required to be delivered pursuant to Sections 4.1 and 4.3(collectively, the
     "Merger Consideration," and the certificates representing the Parent Shares
     comprising the Merger Consideration being referred to hereinafter as the
     "Stock Merger Exchange Fund"). The Exchange Agent shall, pursuant to
     irrevocable instructions, deliver the Merger Consideration out of the Stock
     Merger Exchange Fund and the Fractional Securities Fund (as hereafter
     defined). The Stock Merger Exchange Fund and the Fractional Securities Fund
     shall not be used for any purpose other than as set forth herein.

          (b) Exchange Procedures. Promptly after the Effective Time, Parent
     shall cause the Exchange Agent to mail to each holder of record of
     outstanding Company Shares (i) a form of letter of transmittal, in a form
     reasonably satisfactory to the Parties and (ii) instructions for use in
     effecting the surrender of the certificates representing Company Shares
     ("Certificates") for payment therefor. Upon surrender of Certificates for
     cancellation to the Exchange Agent, together with such letter of
     transmittal duly executed and completed in accordance with the instructions
     thereto, and any other documents as may be required by the Exchange Act,
     the holder of such Certificate shall be entitled to receive in exchange for
     each of the Company Shares represented by the Certificates held of record
     by such holder (1) one or more Parent Shares (which shall be in
     uncertificated book-entry form unless a physical certificate is requested)
     representing, in the aggregate, the whole number of Parent Shares that such
     holder has the right to receive pursuant to Section 4.1(a) and (2) a check
     in the amount equal to the cash that such holder has the right to receive
     in lieu of any fractional Parent Shares pursuant to Sections 4.1 and 4.3.
     No interest will be paid or will accrue on any cash payable pursuant to
     Sections 4.1 and 4.3. The Certificates so surrendered pursuant to this
     Section 4.2(b) shall forthwith be canceled. Until so surrendered, such
     Certificates shall represent solely the right to receive the Merger
     Consideration allocable to such Certificates.

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          (c) Distributions with Respect to Unexchanged Shares. No dividends or
     other distributions that are declared or made with respect to Parent Shares
     with a record date after the Effective Time shall be paid to the holder of
     any unsurrendered Certificate with respect to the Parent Shares that such
     holder would be entitled to receive by reason of the Merger upon surrender
     of such Certificate and no cash payment in lieu of fractional Parent Shares
     shall be paid to any such holder pursuant to Sections 4.1 and 4.3 until
     such holder shall surrender such Certificate. Subject to the effect of
     applicable law, following surrender of any such Certificate, there shall be
     paid to such holder of Parent Shares issuable in exchange therefor, without
     interest, (i) promptly after the time of such surrender, the amount of any
     cash payable in lieu of fractional Parent Shares to which such holder is
     entitled pursuant to Sections 4.1 and 4.3 and the amount of dividends or
     other distributions with a record date after the Effective Time theretofore
     paid prior to the time of such surrender with respect to such whole Parent
     Shares, and (ii) at the appropriate payment date, the amount of dividends
     or other distributions with a record date after the Effective Time but
     prior to such surrender and a payment date subsequent to such surrender
     payable with respect to such Parent Shares. Any dividends or other
     distributions that are payable with respect to Parent Shares deliverable
     upon surrender of unexchanged Certificates shall be deposited by Parent in
     the Stock Merger Exchange Fund.

          (d) Transfers of Ownership. If any certificate representing Parent
     Shares is to be issued in a name other than that in which the Certificate
     surrendered in exchange therefor is registered, it shall be a condition of
     such exchange that the Certificate so surrendered shall be properly
     endorsed and otherwise in proper form for transfer and that the Person
     requesting such exchange shall pay to the Exchange Agent any transfer or
     other taxes required by reason of the issuance of certificates for such
     Parent Shares in a name other than that of the registered holder of the
     Certificate surrendered, or shall establish to the satisfaction of the
     Exchange Agent that such tax has been paid or is not applicable.

          (e) No Liability. Neither the Exchange Agent nor any of the Parties
     shall be liable to a holder of Company Shares for any Parent Shares or
     dividends thereon, or, in accordance with Sections 4.1 and 4.3, cash in
     lieu of fractional Parent Shares, delivered to a public official pursuant
     to applicable abandoned property, escheat or similar law. The Exchange
     Agent shall not be entitled to vote or exercise any rights of ownership
     with respect to the Parent Shares held by it from time to time hereunder,
     except that it shall receive and hold all dividends or other distributions
     paid or distributed with respect to such Parent Shares for the account of
     the Persons entitled thereto.

          (f) Termination of Funds. Subject to applicable law, any portion of
     the Stock Merger Exchange Fund and the Fractional Securities Fund which
     remains unclaimed by the former stockholders of the Company for six months
     after the Effective Time shall be delivered to Parent or as otherwise
     directed by Parent, and any former stockholder of the Company shall
     thereafter look only to Parent for payment of their applicable claim for
     the Merger Consideration for their Company Shares. Any such portion of the
     Stock Merger Exchange Fund and the Fractional Securities Fund remaining
     unclaimed by holders of Company Shares five years after the Effective Time
     (or such earlier date immediately prior to such time as such amounts would
     otherwise escheat to or become property of any Governmental Entity having
     jurisdiction thereover) shall, to the extent permitted by law, become the
     property of the Surviving Corporation free and clear of any claims or
     interest of any Person previously entitled thereto.

          (g) No Further Ownership Rights in Company Shares. All Parent Shares
     issued and cash paid upon conversion of Company Shares in accordance with
     the terms of this Article IV (including any cash paid pursuant to Sections
     4.1 and 4.3) shall be deemed to have been issued or paid in full
     satisfaction of all rights pertaining to the Company Shares.

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     4.3 Cash For Fractional Parent Shares. No certificates or scrip or shares
of Parent Shares representing fractional Parent Shares or book-entry credit of
the same shall be issued upon the surrender for exchange of Certificates and
such fractional share interests will not entitle the owner thereof to vote or to
have any rights of a stockholder of Parent or a holder of Parent Shares.
Notwithstanding any other provision of this Agreement, each holder of Company
Shares exchanged pursuant to the Merger who would otherwise have been entitled
to receive a fractional Parent Share (after taking into account all Certificates
delivered by such holder) shall receive, in lieu thereof, a cash payment
(without interest) in an amount equal to the product of (i) the fractional
interest of a Parent Share to which such holder otherwise would have been
entitled multiplied by (ii) the Parent Share Market Value (the cash comprising
such aggregate payments in lieu of fractional Parent Shares being hereinafter
referred to as the "Fractional Securities Fund").

     4.4 Transfer of Shares after the Effective Time. No transfers of Company
Shares shall be made on the stock transfer books of the Company after the close
of business on the day prior to the date of the Effective Time.

     4.5 Investment of the Stock Merger Exchange Fund and Fractional Securities
Fund. The Exchange Agent shall invest any cash included in the Stock Merger
Exchange Fund and the Fractional Securities Fund in obligations of, or
guaranteed by, the United States of America, in commercial paper obligations
rated A-1 or P-1 or better by Moody's Investor Services or Standard & Poor's
Corporation, respectively, in each case with maturities not exceeding seven
days; provided, that no such investment or loss thereon shall affect the amounts
payable to Company stockholders pursuant to Article IV and the other provisions
of this Agreement. Any interest and other income resulting from such investments
shall promptly be paid to Parent.

     4.6 Lost Certificates. If any Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the Person claiming
such Certificate to be lost, stolen or destroyed and, if required by the
Surviving Corporation (or Parent, as applicable), the posting by such Person of
a bond in such reasonable amount as the Surviving Corporation (or Parent, as
applicable) may direct as indemnity against any claim that may be made against
it with respect to such Certificate, the Exchange Agent will deliver in exchange
for such lost, stolen or destroyed Certificate the applicable Merger
Consideration with respect to the Company Shares formerly represented thereby
and unpaid dividends and distributions on Parent Shares deliverable in respect
thereof, pursuant to and in accordance with the terms of this Agreement.

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

     4.8 Appraisal Rights. Notwithstanding anything in this Agreement to the
contrary, Company Shares that are issued and outstanding immediately prior to
the Effective Time and are held by stockholders of the Company who did not vote
in favor of the Merger and who comply with all of the relevant provisions of
Section 23B.13.230 of the WBCA (the "Dissenting Stockholders") shall not be
converted into or be exchangeable for the right to receive the Merger
Consideration, unless and until such stockholders shall have failed to perfect
or shall have effectively withdrawn or lost their rights to appraisal under the
WBCA. The Company shall give Parent (i) prompt notice of any written demands for
appraisal of any Merger Consideration, attempted withdrawals of such demands and
any other instruments served pursuant to the WBCA and received by the Company
relating to stockholders' rights of appraisal, and (ii) the opportunity to
direct all negotiations and proceedings

                                        6

<PAGE>

with respect to demands for appraisal under the WBCA. Neither the Company nor
the Surviving Corporation shall, except with the prior written consent of
Parent, voluntarily make any payment with respect to, or settle or offer to
settle, any such demand for payment. If any Dissenting Stockholder shall fail to
perfect or shall have effectively withdrawn or lost the right to dissent, then
(i) as of the occurrence of such event, such holder's Company Shares shall be
converted into and represent the right to receive the Parent Shares issuable
pursuant to Section 4.1, and (ii) promptly following the occurrence of such
event, Parent shall deliver to the Exchange Agent the Merger Consideration to
which such holder is entitled pursuant to Section 4.1.

                                    ARTICLE V

                         REPRESENTATIONS AND WARRANTIES

     5.1 Representations and Warranties of the Company. The Company hereby
represents and warrants to Parent and Merger Sub that the statements contained
in this Section 5.1 are true and correct, except to the extent specifically set
forth on the disclosure schedule delivered by the Company to Parent and Merger
Sub (the "Company Disclosure Schedule"). The Company Disclosure Schedule shall
be arranged in sections and paragraphs corresponding to the letter and numbered
paragraphs contained in this Section 5.1, and the disclosure in any paragraph
shall qualify only the corresponding paragraph in this Section 5.1 or other
paragraphs or sections to which it is clearly apparent (from a plain reading of
the disclosure) that such disclosure relates.

          (a) Corporate Organization and Qualification. The Company is a
     corporation duly organized, validly existing and in good standing under the
     laws of the jurisdiction of incorporation and is duly qualified and in good
     standing as a foreign corporation in each jurisdiction where the properties
     owned, leased or operated, or the business conducted, by it require such
     qualification, except where failure to so qualify or be in good standing as
     a foreign corporation would not have a Material Adverse Effect on the
     Company. The Company has all requisite power and authority (corporate or
     otherwise) to own, lease and operate its properties and to carry on its
     business as it is now being conducted except where failure to have such
     power and authority would not have a Material Adverse Effect on the
     Company. The copies of articles of incorporation and bylaws of the Company
     which were previously furnished or made available to Parent are true,
     complete and correct copies of such documents as in effect on the date of
     this Agreement.

          (b) Capitalization. As of the date of this Agreement, the authorized
     capital stock of the Company consists of 100,000,000 shares of common
     stock, $0.0001 par value per share, of which 8,636,482 shares were issued
     and outstanding. Since November 15, 2000 to the date of this Agreement,
     there have been no issuances of Company Shares or any other securities of
     the Company other than issuances of Company Shares pursuant to options or
     rights outstanding as of November 15, 2000 under the stock option plans of
     the Company identified in Section 5.1(b) of the Company Disclosure Schedule
     (the "Company Option Plans"). All of the outstanding shares of capital
     stock of the Company are duly authorized, validly issued, fully paid and
     nonassessable and free of any preemptive or similar rights. The Company has
     no outstanding stock appreciation rights, phantom stock, restricted stock
     or similar rights. The Company does not own any interest in, or securities
     of, any Person and there are no subsidiaries of the Company. As of the date
     of this Agreement, except for options to purchase 895,000 Company Shares
     issued pursuant to the Company Option Plans, there are no outstanding or
     authorized options, warrants, calls, rights (including preemptive rights),
     commitments or any other agreements of any character to which the Company
     is a party, or by which the Company may be bound, requiring it to issue,
     transfer, grant, sell, purchase, redeem or acquire any shares of capital
     stock or any of its securities or rights convertible into, exchangeable
     for, or evidencing the

                                        7

<PAGE>

     right to subscribe for, any shares of capital stock of the Company. Section
     5.1(b) of the Company Disclosure Schedule sets forth a complete and correct
     list, as of the date hereof, of the holders of all Company Options (as
     hereafter defined) and the number of Company Shares subject to all
     outstanding options to purchase Company Shares (each, a "Company Option"),
     warrants or other rights to purchase or receive Company Shares granted
     under the Company Option Plans, warrants or otherwise, the dates of grant,
     the terms of vesting and the exercise prices thereof. No options or
     warrants or other rights to acquire capital stock from the Company have
     been issued or granted or accelerated or had their terms modified since
     November 15, 2000 to the date of this Agreement. The transactions
     contemplated by this Agreement will accelerate the vesting of all the
     outstanding Company Options. The Company has the power and right not to
     issue additional options under the Company Option Plans without any
     liability. No bonds, debentures, notes or other indebtedness of the Company
     having the right to vote on any matters on which stockholders may vote are
     issued or outstanding. Except as otherwise set forth in this Section
     5.1(b), as of the date of this Agreement, there are no securities, options,
     warrants, calls, rights, commitments, agreements, arrangements or
     undertakings of any kind to which the Company is a party or by which it is
     bound obligating the Company to issue, deliver or sell, or cause to be
     issued, delivered or sold, additional shares of capital stock or other
     voting securities of the Company or obligating the Company to issue, grant,
     extend or enter into any such security, option, warrant, call, right,
     commitment, agreement, arrangement or undertaking. As of the date of this
     Agreement, there are no outstanding obligations of the Company to
     repurchase, redeem or otherwise acquire any shares of capital stock of the
     Company. Except for the Voting Agreement, there are not as of the date
     hereof and there will not be at the Effective Time any stockholder
     agreements, voting trusts or other agreements or understandings to which
     the Company is a party or to which it is bound relating to the voting of
     any shares of the capital stock of the Company. No existing rights with
     respect to the registration of Company Shares under the Securities Act,
     including, but not limited to, demand rights or piggy-back registration
     rights, shall apply with respect to any Parent Shares issuable in
     connection with the Merger.

          (c) [Intentionally Omitted]

          (d) Authority Relative to this Agreement. The Board of Directors of
     the Company has declared the Merger fair and advisable for the Company's
     stockholders and the Company has the requisite corporate power and
     authority to approve, authorize, execute and deliver this Agreement and,
     subject to the approval of the Merger by the stockholders of the Company in
     accordance with the WBCA, to consummate the transactions contemplated
     hereby. This Agreement and the consummation by the Company of the
     transactions contemplated hereby have been duly and validly authorized by
     the Board of Directors of the Company and no other corporate proceedings on
     the part of the Company are necessary to authorize this Agreement or to
     consummate the transactions contemplated hereby (other than the approval of
     the Merger by the stockholders of the Company in accordance with the WBCA).
     This Agreement has been duly and validly executed and delivered by the
     Company and, assuming this Agreement constitutes the valid and binding
     agreement of Parent and Merger Sub, constitutes the valid and binding
     agreement of the Company, enforceable against the Company in accordance
     with its terms, subject, as to enforceability, to bankruptcy, insolvency,
     reorganization and other laws of general applicability relating to or
     affecting creditors' rights and to general principles of equity.

          (e) Present Compliance with Obligations and Laws. The Company is not:
     (i) in violation of its articles of incorporation or bylaws or similar
     documents; (ii) in default in the performance of any obligation, agreement
     or condition of any debt instrument which (with or without the passage of
     time or the giving of notice, or both) affords to any Person the right to
     accelerate any indebtedness or terminate any right; (iii) in default under
     or breach of (with or without the passage of time or the giving of notice)
     any other contract to which it is a party or by which it

                                        8

<PAGE>

     or its assets are bound; or (iv) in violation of any law, regulation,
     administrative order or judicial order, decree or judgment (domestic or
     foreign) applicable to it or its business or assets, except where any
     violation, default or breach under clauses (iii) or (iv) would not,
     individually or in the aggregate, have a Material Adverse Effect on the
     Company.

          (f) Consents and Approvals; No Violation.

             (i) Neither the execution and delivery of this Agreement by the
        Company nor the consummation by the Company of the transactions
        contemplated hereby will: (A) conflict with or result in any breach of
        any provision of its articles of incorporation or bylaws; (B) require
        any consent, approval, authorization or permit of, or registration or
        filing with or notification to, any Governmental Entity, except (I) in
        connection with the applicable requirements of the Hart-Scott-Rodino
        Antitrust Improvements Act of 1976, as amended (the "HSR Act"), (II)
        pursuant to the applicable requirements of the Securities Act of 1933,
        as amended (the "Securities Act"), and the rules and regulations
        promulgated thereunder, and the Securities Exchange Act of 1934, as
        amended (the "Exchange Act"), and the rules and regulations promulgated
        thereunder, (III) the filing of the applicable certificates evidencing
        the Merger pursuant to the DGCL and WBCA and appropriate documents with
        the relevant authorities of other states in which the Company is
        authorized to do business, (IV) as may be required by any applicable
        state securities or "blue sky" laws, or (V) where the failure to obtain
        such consent, approval, authorization or permit, or to make such filing
        or notification, would not, individually or in the aggregate, have a
        Material Adverse Effect on the Company or to prevent, materially hinder
        or materially delay the ability of the Company to consummate the
        transactions contemplated by this Agreement; (C) result in a violation
        or breach of, or constitute (with or without notice or lapse of time or
        both) a default (or give rise to any right of termination, cancellation
        or acceleration or lien or other charge or encumbrance) under any of the
        terms, conditions or provisions of any indenture, note, license, lease,
        agreement or other instrument or obligation to which the Company is a
        party or by which any of their assets may be bound, except for such
        violations, breaches and defaults (or rights of termination,
        cancellation, or acceleration or lien or other charge or encumbrance) as
        to which requisite waivers or consents have been obtained or which,
        individually or in the aggregate, would not have a Material Adverse
        Effect on the Company; (D) cause the suspension or revocation of any
        authorizations, consents, approvals or licenses currently in effect
        which would have a Material Adverse Effect on the Company; or (E)
        assuming the consents, approvals, authorizations or permits and filings
        or notifications referred to in this Section 5.1(f) are duly and timely
        obtained or made and the approval of the Merger by the stockholders of
        the Company in accordance with WBCA has been obtained, violate any
        order, writ, injunction, decree, statute, rule or regulation applicable
        to the Company or to any of their respective assets, except for
        violations which would not, individually or in the aggregate, have a
        Material Adverse Effect on the Company.

             (ii) The business and operations of the Company have been conducted
        in compliance with all applicable domestic and foreign statutes,
        regulations and rules regulating such business and operations except
        where the failure to so conduct such business and operations would not,
        individually or in the aggregate, have a Material Adverse Effect on the
        Company or to prevent, materially hinder or materially delay the ability
        of the Company to consummate the transactions contemplated by this
        Agreement.

          (g) Litigation. There are no actions, suits, claims, investigations or
     proceedings pending or, to the knowledge of the Company, threatened against
     the Company that, alone or in the aggregate, would be reasonably likely to
     result in obligations or liabilities of the Company that

                                        9

<PAGE>

     would have a Material Adverse Effect on the Company. The Company is not
     subject to any outstanding order, writ, injunction or decree which (i) has
     or may have the effect of prohibiting or impairing any business practice of
     the Company, any acquisition of property (tangible or intangible) by the
     Company, the conduct of the business by the Company, or Company's ability
     to perform its obligations under this Agreement or (ii) insofar as can be
     reasonably foreseen, individually or in the aggregate, would have a
     Material Adverse Effect on the Company.

          (h) SEC Reports; Financial Statements.

             (i) Since November 30, 2000 the Company has filed all forms,
        reports and documents with the SEC required to be filed by it pursuant
        to the federal securities laws and the SEC rules and regulations
        thereunder, all of which complied in all material respects with all
        applicable requirements of the Securities Act and the Exchange Act and
        the rules and regulations promulgated thereunder (the "Company SEC
        Reports"). None of the Company SEC Reports, including, without
        limitation, any financial statements or schedules included therein, at
        the time filed (or if amended or superseded by a filing prior to the
        date of this Agreement, then on the date of such filing) contained any
        untrue statement of a material fact or omitted to state a 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 misleading.

             (ii) The balance sheets and the related statements of income,
        stockholders' equity and cash flow (including the related notes thereto)
        of the Company included in the Company SEC Reports (collectively, the
        "Company Financial Statements") comply as to form in all material
        respects with applicable accounting requirements and the published rules
        and regulations of the SEC with respect thereto, have been prepared in
        accordance with GAAP applied on a consistent basis throughout the
        periods involved (except as otherwise noted therein or, in the case of
        unaudited interim financial statements, as may be permitted by the SEC
        on Form 10-Q under the Exchange Act), and present fairly the financial
        position of the Company as of their respective dates and the results of
        its operations and its cash flow for the periods presented therein
        (subject, in the case of the unaudited interim financial statements, to
        normal and recurring year-end adjustments). Since November 30, 2000,
        there has not been any material change by the Company in accounting
        principles, methods or policies for financial accounting purposes except
        as required by concurrent changes in GAAP.

          (i) No Liabilities; Absence of Certain Changes or Events. The Company
     does not have any material indebtedness, obligations or liabilities of any
     kind (whether accrued, absolute, contingent or otherwise, and whether due
     or to become due or asserted or unasserted), and there is no reasonable
     basis for the assertion of any material claim or liability of any nature
     against the Company, except for liabilities (i) which are fully reflected
     in, reserved against or otherwise described in the Company Financial
     Statements for the period ending November 30, 2000, (ii) which have been
     incurred after November 30, 2000 in the ordinary course of business,
     consistent with past practice, or (iii) which, individually or in the
     aggregate, would not have a Material Adverse Effect on the Company. Since
     November 30, 2000, the business of the Company has been carried on only in
     the ordinary and usual course, and there has not been any Material Adverse
     Effect on the Company.

          (j) Brokers and Finders. The Company has not employed any investment
     banker, broker, finder, consultant or intermediary in connection with the
     transactions contemplated by this Agreement which would be entitled to any
     investment banking, brokerage, finder's or similar fee or commission in
     connection with this Agreement or the transactions contemplated hereby.

                                       10

<PAGE>

          (k) S-3 Registration Statement, S-4 Registration Statement and Proxy
     Statement/ Prospectus. None of the information supplied or to be supplied
     by the Company for inclusion or incorporation by reference in the S-3
     Registration Statement (as hereafter defined), the S-4 Registration
     Statement (as hereafter defined) or the Proxy Statement (as hereafter
     defined, and together with S-3 Registration Statement and S-4 Registration
     Statement, the "Registration Statements") will (i) in the case of each of
     the Registration Statements, at the time they become effective or at the
     Effective Time, 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 not misleading, or (ii) in the case of the
     Proxy Statement, at the time of the mailing of the Proxy Statement and at
     the time of the Company Stockholder Meeting, contain any untrue statement
     of a material fact or omit to state any material fact required to be stated
     therein or necessary in order to make the statements therein, in light of
     the circumstances under which they are made, not misleading. If at any time
     prior to the Effective Time any event with respect to the Company or its
     officers and directors should occur which is required to be described in an
     amendment of, or a supplement to, the Registration Statements, the Company
     shall promptly inform Parent, such event shall be so described, and such
     amendment or supplement shall be promptly filed with the SEC and, as
     required by law, disseminated to the stockholders of the Company. Each of
     the Registration Statements will (with respect to the Company) comply as to
     form in all material respects with the requirements of the Securities Act
     and the rules and regulations promulgated thereunder. The Proxy Statement
     will (with respect to the Company) comply as to form in all material
     respects with the requirements of the Exchange Act and the rules and
     regulations promulgated thereunder. Notwithstanding the foregoing
     provisions of this Section 5.1(k), no representation or warranty is made by
     the Company with respect to statements made or incorporated by reference in
     the Registration Statements based on information supplied by Parent or
     Merger Sub for inclusion or incorporation by reference therein.

          (l) Taxes.

             (i) The Company has timely filed all federal, state, local and
        foreign returns, information, statements, and reports relating to Taxes
        ("Returns") required by applicable Tax law to be filed by the Company,
        except for any such failures to file that would not, individually or in
        the aggregate, have a Material Adverse Effect on the Company. All Taxes
        owed by the Company to a taxing authority, or for which the Company is
        liable, whether to a taxing authority or to other Persons or entities
        under a Significant Tax Agreement, as of the date of this Agreement,
        have been paid and, as of the Effective Time, will have been paid,
        except for any such failure to pay that would not, individually or in
        the aggregate, have a Material Adverse Effect on the Company. The
        Company has made accruals for Taxes on the Company Financial Statements
        which are adequate to cover any Tax liability of the Company determined
        in accordance with generally accepted accounting principles through the
        date of the Company Financial Statements, except where failures to make
        such accruals or provisions would not, individually or in the aggregate,
        have a Material Adverse Effect on the Company.

             (ii) Except to the extent that any such failure to withhold would
        not, individually or in the aggregate, have a Material Adverse Effect on
        the Company, the Company has (A) withheld with respect to its employees
        all federal, state, local and foreign income taxes, FICA, FUTA and other
        Taxes required to be withheld, (B) paid all employer contributions and
        premiums and (C) filed all federal, state, local and foreign returns and
        reports with respect to employee income tax, withholding, social
        security and unemployment taxes and premiums.

                                       11

<PAGE>

             (iii) There is no Tax deficiency outstanding, proposed or assessed
        against the Company, except any such deficiency that, if paid, would
        not, individually or in the aggregate, have a Material Adverse Effect on
        the Company. The Company has not executed or requested any waiver of any
        statute of limitations on or extending the period for the assessment or
        collection of any federal or material state, local or foreign Tax that
        is still in effect.

             (iv) No federal, state, local or foreign Tax audit or other
        examination of the Company is presently in progress, nor has the Company
        been notified in writing of any request for such federal or material
        state, local or foreign Tax audit or other examination, except in all
        cases for Tax audits and other examinations which would not,
        individually or in the aggregate, have a Material Adverse Effect on the
        Company. The Company has not entered into any closing agreement or other
        agreement which affects any Taxes of the Company for any taxable year
        ending after the Effective Date.

             (v) The Company has not filed any consent agreement under Section
        341(f) of the Code or agreed to have Section 341(f)(2) of the Code apply
        to any disposition of a subsection (f) asset (as defined in Section
        341(f)(4) of the Code) owned by the Company.

             (vi) The Company is not a party to (A) any agreement with a party
        other than the Company providing for the allocation or payment of Tax
        liabilities or payment for Tax benefits with respect to a consolidated,
        combined or unitary Return which Return includes or included the Company
        or (B) any Significant Tax Agreement other than any Significant Tax
        Agreement described in clause (A). The Company is not a party to any
        joint venture, partnership or other arrangement that could be treated as
        a partnership for federal income tax purposes.

             (vii) The Company has never been a member of an affiliated group of
        corporations within the meaning of Section 1504 of the Code.

             (viii) The Company has not agreed to make nor is it required to
        make any adjustment under Section 481(a) of the Code by reason of a
        change in accounting method or otherwise which have not yet been taken
        into account. Neither the Internal Revenue Service nor any other agency
        has proposed to the Company any such adjustment or change. The Company
        does not have any application for accounting method changes pending with
        any taxing authorities that affect any taxable year ending after the
        Effective Date.

             (ix) The Company is not, and has not at any time been, a "United
        States Real Property Holding Corporation" within the meaning of Section
        897(c)(2) of the Code.

             (x) There is no contract, agreement, plan or arrangement covering
        any employee or former employee of the Company that, individually or
        collectively, could give rise to the payment by the Company of any
        amount that would not be deductible by reason of Section 280G of the
        Code.

             (xi) No asset of the Company is tax-exempt use property under
        Section 168(h) of the Code. No portion of the cost of any asset of the
        Company has been financed directly or indirectly from the proceeds of
        any tax-exempt state or local government obligation described in Section
        103(a) of the Code. None of the assets of the Company is property that
        the Company is required to treat as being owned by any other person
        pursuant to the safe harbor lease provision of former Section 168(f)(8)
        of the Code.

             (xii) The Company does not have nor has it ever had a permanent
        establishment in any foreign country or engages or has engaged in a
        trade or business in any foreign country.

                                       12

<PAGE>

             (xiii) Neither the Code nor any other provision of law requires
        Parent or Merger Sub to withhold any portion of the Merger
        Consideration.

             (xiv) In the past five years, the Company has not been a party to a
        transaction that has been reported as a reorganization within the
        meaning of Section 368 of the Code other than as set forth on Section
        5.1(l)(xiv) of the Company Disclosure Schedule, distributed a
        corporation (or been distributed) in a transaction that is reported to
        qualify under Section 355 of the Code.

             (xv) Section 5.1(l)(xv) of the Company Disclosure Schedule sets
        forth the amount of any net operating loss, net capital loss, unused
        investment credit, unused foreign tax, or excess charitable contribution
        allocable to the Company.

          (m) Employee Benefits.

             (i) Section 5.1(m)(i) of the Company Disclosure Schedule lists each
        "employee pension benefit plan" (as such term is defined in Section 3(2)
        of ERISA), "employee welfare benefit plan" (as such term is defined in
        Section 3(1) of ERISA), material personnel or payroll policy (including,
        but not limited to, vacation time, holiday pay, service awards, moving
        expense reimbursement programs and sick leave) or material fringe
        benefit, severance agreement or plan or any medical, hospital, dental,
        vision care, life or disability plan, excess benefit plan, bonus, stock
        option, stock purchase or other incentive plan (including any equity or
        equity-based plan), top hat plan or deferred compensation plan, salary
        reduction agreement (including, but not limited to, cafeteria benefit or
        dependent care), change-of-control agreement, employment agreement,
        consulting agreement, or collective bargaining agreement,
        indemnification agreement, retainer agreement, or any other material
        benefit plan, policy, program, arrangement, agreement or contract,
        whether or not written or terminated, with respect to any employee,
        former employee, director, independent contractor or any beneficiary or
        dependent thereof maintained, sponsored, adopted or administered by the
        Company or any former subsidiary or to which the Company or any current
        or former Plan Affiliate, or under or with respect to which the Company
        or any Plan Affiliate could reasonably be expected to have any
        liability, including (but not limited to) any plan subject to Section
        412 of the Code, or any plan with any remaining liability or benefit
        obligation, that has been terminated by Company. Each plan, policy,
        program, arrangement, agreement or contract described in the preceding
        sentence, whether or not set forth in Section 5.1(m) of the Company
        Disclosure Schedule on the Company Financial Statement, is referred to
        in this Agreement as a "Company Scheduled Plan".

             (ii) The Company has delivered or made available to Parent a
        complete and accurate copy of each written Company Scheduled Plan,
        together with, if applicable: a copy of its audited financial
        statements, actuarial reports and Form 5500 Annual Reports (including
        required schedules), if any, for the three most recent plan years; the
        most recent IRS determination letter or IRS recognition of exemption;
        each other material letter, ruling or notice issued by a governmental
        body with respect to each such plan; a copy of each trust agreement,
        insurance contract or other funding vehicle, if any, with respect to
        each such plan; the three most recent PBGC Forms 1 filed with respect to
        each such plan; the current summary plan description and summary of
        material modifications thereto with respect to each such plan; Form 5310
        and any related filings with the Pension Benefit Guaranty Corporation
        (together with any entity succeeding to any or all of its functions,
        "PBGC") with respect to the last three (3) plan years for which those
        filings have yet been made; the general notification to employees of
        their rights under Code Section 4980B and form of letter distributed
        upon the occurrence of a qualifying event described in Code Section
        4980B; and a copy or description of each other general explanation or
        written or oral

                                       13

<PAGE>

        communication which describes a material term of each Company Scheduled
        Plan that has not previously been disclosed to Parent pursuant to this
        Section 5.1(m). Section 5.1(m)(ii) of the Company Disclosure Schedule
        contains a description of the material terms of any unwritten Company
        Scheduled Plan. Except as set forth in Section 5.1(l) of the Company
        Disclosure Schedule, there are no negotiations, demands or proposals
        which are pending or threatened which concern matters now covered, or
        that would be covered, by any unwritten Company Scheduled Plan.

             (iii) The representations in this Section 5.1(m)(iii) cover
        compliance issues with respect to the Company Scheduled Plans.

                (1) Each Company Scheduled Plan (A) has complied and currently
           complies in form and in operation in all material respects with all
           applicable requirements of ERISA and the Code, and any other legal
           requirements; (B) has been and is operated and administered in
           compliance with its terms (except as otherwise required by law); (C)
           has been and is operated in compliance with applicable legal
           requirements in such a manner as to qualify, where appropriate, for
           both Federal and state purposes, for income tax exclusions to its
           participants, income tax exemption, tax-exempt income for its funding
           vehicle, and the allowance of deductions and credits with respect to
           contributions thereto; and (D) with respect to each Scheduled Company
           Plan that is intended to be tax-qualified under Section 401(a) of the
           Code, has received a favorable determination letter or recognition of
           exemption from the Internal Revenue Service, and, to the knowledge of
           the Company, has experienced or presented no circumstances that would
           adversely affect its tax-qualified status.

                (2) With respect to each Company Scheduled Plan, there are no
           claims or other proceedings pending or, to the knowledge of the
           Company, threatened with respect to the assets thereof (other than
           routine claims for benefits), and there are no facts known to the
           Company which could reasonably give rise to any material liability,
           claim or other proceeding against any Company Scheduled Plan, any
           fiduciary or plan administrator or other Person dealing with any
           Company Scheduled Plan or the assets of any such Company Scheduled
           Plan.

                (3) With respect to each Company Scheduled Plan, to the
           knowledge of the Company, no Person: (A) has entered into any
           "prohibited transaction," as such term is defined in Section 406 of
           ERISA or Section 4975 of the Code; (B) has materially breached a
           fiduciary obligation or violated Sections 402, 403, 405, 503, 510 or
           511 of ERISA; (C) has any material liability for any failure to act
           or comply in connection with the administration or investment of the
           assets of the plan; or (D) has engaged in any transaction or
           otherwise acted with respect to the plan in a manner that could
           subject Parent, or any fiduciary or plan administrator or any other
           Person dealing with the plan, to material liability under Section 409
           or 502 of ERISA or Sections 4972 or 4976 through 4980B of the Code.

                (4) Except as set forth in Section 5.1(m)(iii) of the Company
           Disclosure Schedule, each Company Scheduled Plan may be amended,
           terminated, modified or otherwise revised by the Company or Parent,
           as provided in the Company Scheduled Plan as so amended, on and after
           the Closing, without (A) further material liability to the Company or
           Parent (excluding ordinary administrative expenses and routine claims
           for benefit plans), including, but not limited to, any withdrawal
           liability under ERISA for any multiemployer plan or any liability
           under any Company Scheduled Plan subject to Title IV of ERISA or (B)
           additional vesting or acceleration of such benefits.

                                       14

<PAGE>

                (5) None of the Company or any current or former Plan Affiliate
           has at any time participated in, made contributions to or had any
           other liability with respect to any Company Scheduled Plan that is a
           "multiemployer plan" as defined in Section 4001 of ERISA, a
           "multiemployer plan" within the meaning of Section 3(37) of ERISA, a
           "multiple employer plan" within the meaning of Section 413(c) of the
           Code, a "multiple employer welfare arrangement" within the meaning of
           Section 3(40) of ERISA or any pension plan (within the meaning of
           Section 3(2) of ERISA) that is subject to Part 3 of Subtitle B of
           Title I of ERISA, Title IV of ERISA or Section 412 of the Code.

                (6) Except as set forth in Schedule 5.1(m)(iii) of the Company
           Disclosure Schedule, there is no agreement, contract or arrangement
           to which Company is a party that may result in the payment of any
           amount that would not be deductible by reason of Section 280G or
           Section 404 of the Code.

                (7) No Company Scheduled Plan provides, reflects or represents
           any liability to provide retiree medical or other post-employment
           welfare benefits to any person for any reason, except as may be
           required by the Consolidated Omnibus Budget Reconciliation Act of
           1985, as amended ("COBRA"), or other applicable continuation coverage
           statute, and neither the Company nor any Plan Affiliate has ever
           represented, promised or contracted (whether in oral or written form)
           to any current or former employee, consultant or director (either
           individually or as a group) or any other person that any current or
           former employee(s) or other person would be provided with retiree
           medical or other post-employment welfare benefit, except to the
           extent required by an applicable continuation coverage statute like
           COBRA.

                (8) No Company Scheduled Plan has incurred an "accumulated
           funding deficiency," as that term is defined in Section 302 of ERISA
           or Section 412 of the Code, whether or not waived, or has posted or
           is required to provide security under Code Section 401(a)(29) or
           Section 307 of ERISA. No event has occurred that has or could result
           in the imposition of a lien under Code Section 412 or Section 302 of
           ERISA, nor has any liability to the PBGC (except for payment of
           premiums) been incurred nor any reportable event within the meaning
           of Section 4043 of ERISA occurred with respect to any Company
           Scheduled Plan. The PBGC has not threatened or taken steps to
           institute the termination of any Company Scheduled Plan.

                (9) The requirements of COBRA and the Health Insurance
           Portability and Accountability Act, the requirements of the Family
           and Medical Leave Act of 1993, as amended, the requirements of the
           Women's Health and Cancer Rights Act, the requirements of the
           Newborns' and Mothers' Health Protection Act of 1996, and any
           amendment to each such act, and any similar provisions of state law
           applicable to the employees or other individuals providing services
           to the Company or Plan Affiliate, have, in all material respects,
           been satisfied with respect to each Company Scheduled Plan.

                (10) All contributions, payments, premiums, expenses,
           reimbursements and accruals for all periods ending prior to the
           Closing for each Company Scheduled Plan (including periods from the
           first day of the current plan year to the Closing) shall have been
           timely made (if then due) or accrued on the Company financial
           statements (if not yet due) in accordance with generally applied
           accounting principles, including FAS 87, 88, 106 and 112. No Company
           Scheduled Plan has or could have any unfunded liability (including
           benefit liabilities as defined in Section 4001(a)(16) of

                                       15

<PAGE>

           ERISA) that is not reflected on the Company financial statements. The
           same shall be true for all periods ending as of the Closing for each
           Company Scheduled Plan.

                (11) Neither the Company nor a Plan Affiliate has any liability
           (A) for the termination of any single employer plan under Section
           4062 of ERISA or any multiple employer plan under Section 4063 of
           ERISA, (B) for any lien imposed under Section 302(f) of ERISA or
           Section 412(n) of the Code, (C) for any interest payments required
           under Section 302(e) of ERISA or Section 412(m) of the Code, (D) for
           any excise tax imposed by Code Sections 4971, 4972, 4977, or 4979, or
           (E) for any minimum funding contributions under Section 302(c)(11) of
           ERISA or Code Section 412(c)(11).

                (12) All the Company Scheduled Plans to the extent applicable,
           are in compliance with Section 1862(b)(1)(A)(i) of the Social
           Security Act and neither the Company nor any Plan Affiliate has any
           liability for any excise tax imposed by Code Section 5000.

                (13) With respect to any Company Scheduled Plan which is a
           welfare plan as defined in Section 3(1) of ERISA: (A) each such
           welfare plan which is intended to meet the requirements for
           tax-favored treatment under Subchapter B of Chapter 1 of the Code
           materially meets such requirements and (B) there is no disqualified
           benefit (as that term is defined in Code Section 4976(b)) which would
           subject the Company or any Plan Affiliate to a tax under Code Section
           4976(a).

             (iv) Neither the execution of this Agreement nor the consummation
        of the transactions contemplated by this Agreement will (either alone or
        in conjunction with any other event, such as termination of employment)
        (A) entitle any current or former employee of the Company or a Plan
        Affiliate to severance pay, unemployment compensation or any other
        payment or benefit, (B) accelerate the time of payment or vesting of any
        payment (other than for a terminated or frozen tax-qualified plan,
        pursuant to a requirement herein to freeze or terminate that plan),
        cause the forgiveness of any indebtedness, or increase the amount of any
        compensation due to any current employee or former employee of the
        Company or a Plan Affiliate, or (C) result in any prohibited transaction
        described in Section 406 of ERISA or Section 4975 of the Code for which
        an exemption is not available. No individual who is a party to an
        employment or change of control agreement listed in the Company
        Disclosure Schedule has terminated employment or has been terminated.

             (v) There has been no amendment to, written interpretation or
        announcement (whether written or otherwise) by the Company or other Plan
        Affiliates relating to, or change in participation or coverage under,
        any Company Scheduled Plan that would materially increase the expense of
        maintaining that plan above the level of expense incurred with respect
        to that plan for the most recent fiscal quarter included in the Company
        Financial Statements.

          (n) Company Intangible Property.

             (i) Company owns, or possesses a valid and enforceable license or
        otherwise possesses legally enforceable rights to use, all Company
        Intellectual Property Rights (as hereafter defined) that are necessary
        to conduct the business of the Company as currently conducted or planned
        to be conducted and has no restriction on the rights to use the same.

             (ii) Section 5.1(n)(ii) of the Company Disclosure Schedule contains
        a list and description (showing in each case the registered or other
        owner, registration, application or issue date and number, if any) of
        all Company Intellectual Property Rights.

                                       16

<PAGE>

             (iii) Section 5.1(n)(iii) of the Company Disclosure Schedule
        contains a list and description (showing in each case any licensee) of
        all Software (as hereafter defined) owned by or licensed to the Company
        excluding Software licensed to the Company having a fee less than five
        hundred dollars ($500).

             (iv) Section 5.1(n)(iv) of the Company Disclosure Schedule contains
        a list and description (showing in each case the parties thereto and the
        material terms thereof) of all material agreements, contracts, licenses,
        sublicenses, assignments and indemnities which relate to (A) any
        copyright, patent right, servicemark or trademark listed in Section
        5.1(n)(ii) of the Company Disclosure Schedule, (B) any trade secrets
        owned by, licensed to or used by the Company or (C) any Software listed
        in Section 5.1(n)(iii) of the Company Disclosure Schedule.

             (v) The Company is not nor will be as a result of the execution and
        delivery of this Agreement or the performance of its obligations under
        this Agreement, in breach in any material respect of any license,
        sublicense or other agreement relating to the Company Intellectual
        Property Rights or any license, sublicense or other agreement pursuant
        to which the Company is authorized to use any third party patents,
        trademarks or copyrights, including Software, which are used in the
        manufacture of, incorporated in, or form a part of any product of the
        Company. All such agreements of the Company are listed in Section
        5.1(n)(v)of the Company Disclosure Schedule.

             (vi) (A) All patents, registered trademarks, service marks and
        copyrights held by the Company are valid and enforceable and any and all
        applications to register any unregistered copyrights, patent rights,
        servicemarks and trademarks to identified are pending and in good
        standing; and (B) the Company has the sole and exclusive right to bring
        actions for infringement or unauthorized use of the Company Intellectual
        Property Rights and Software owned by the Company, and the Company has
        no knowledge of any basis for any such action. The Company has not been
        sued in any suit, action or proceeding which involves a claim of
        infringement of any patent, trademark, service mark or copyright or the
        violation of any trade secret or other proprietary rights of any third
        party. The conduct of the business of the Company does not violate or
        infringe any intellectual property rights owned or controlled by any
        third party, and there are no claims, proceedings or actions pending or,
        to the knowledge of the Company, threatened against the Company (A)
        alleging that the Company's activities infringe upon, violate or
        otherwise constitute the unauthorized use of any intellectual property
        rights of any third party or (B) challenging the ownership, use,
        validity or enforceability of any Company Intellectual Property Rights,
        nor is there a valid basis for any such claim.

             (vii) The Company has taken reasonable measures to safeguard and
        maintain their proprietary rights in all Company Intellectual Property
        Rights owned by the Company. There has been no disclosure of any trade
        secret of the Company to any third party, other than pursuant to valid,
        enforceable, written non-disclosure agreements.

             (viii) The completion of the transactions contemplated by this
        Agreements will not alter or impair the right of the Company to use any
        of the Company Intellectual Property Rights.

             (ix) All Company Intellectual Property Rights owned by the Company
        have been (A) acquired from a person or entity having full, effective
        and exclusive ownership thereof, (B) developed or created by employees,
        agents, consultants or contractors who have contributed to or
        participated in the creation or development of any copyrightable,
        patentable or trade secret material on behalf of the Company or any
        predecessor in interest

                                       17

<PAGE>

        thereof either: (1) with respect to copyrightable materials, is a party
        to a "work-for-hire" agreement under which the Company or any
        predecessor in interest thereof is deemed to be the original
        owner/author of all property rights therein; or (2) with respect to
        copyrightable or patentable materials or materials subject to trade
        secret protection, has executed an assignment or an agreement to assign
        in favor of the Company or any predecessor in interest thereof, of all
        right, title and interest in such material.

             (x) Correct and complete copies of: (A) registrations for all
        registered copyrights, issued patents, and registered trademarks
        identified in Section 5.1(n)(ii); and (B) all pending applications to
        register unregistered copyrights, patent rights and trademarks
        identified in Section 5.1(n)(ii) of the Company Disclosure Schedule as
        being owned by the Company (together with any subsequent correspondence
        or filings relating to the foregoing) have heretofore been delivered by
        the Company to the Parent.

             (xi) Excluding the Software identified in Section 5.1(n)(xi)of the
        Company Disclosure Schedule, (A) the Software owned or exclusively
        licensed by the Company is not subject by agreement to any transfer,
        assignment, site, equipment, or other operational limitations; (B) the
        Company has maintained and protected the Software that it owns (the
        "Company Owned Software") (including, without limitation, all source
        code and system specifications) with appropriate proprietary notices
        (including, without limitation, the notice of copyright in accordance
        with the requirements of 17 U.S.C. sec. 401), confidentiality and
        non-disclosure agreements and such other measures as are reasonably
        necessary to protect the proprietary, trade secret or confidential
        information contained therein; (C) the Owned Software has been
        registered or is eligible for protection and registration under
        applicable U.S. copyright law and has not been forfeited to the public
        domain; (D) the Company has copies of all releases or separate versions
        of the Company Owned Software so that the same may be subject to
        registration in the United States Copyright Office; (E) the Company has
        complete and exclusive right, title and interest in and to the Company
        Owned Software; (F) the Company has developed the Company Owned Software
        through its own efforts and for its own account; (G) the Company Owned
        Software does not infringe any copyright of any other Person; (H) any
        Company Owned Software includes the source code, system documentation,
        statements of principles of operation and schematics, as well as any
        pertinent commentary, explanation, program (including compilers),
        workbenches, tools, and higher level (or "proprietary") language used
        for the development, maintenance, implementation and use thereof, so
        that a trained computer programmer could develop, maintain, support,
        compile and use all releases or separate versions of the same that are
        currently subject to maintenance obligations by the Company; and (i)
        there are no agreements or arrangements in effect with respect to the
        marketing, distribution, licensing or promotion of the Company Owned
        Software by any other Person.

             (xii) "Company Intellectual Property Rights" means any or all of
        the following and all rights in, arising out of, or associated
        therewith, whether registered or unregistered, as applicable: (i) United
        States and foreign patents and applications therefor and all reissues,
        divisions, renewals, extensions, provisionals, continuations and
        continuations-in-part thereof; (ii) inventions and discoveries (whether
        or not patentable), disclosures, trade secrets, formulae, methods,
        proprietary information, know-how technical data and customer lists, and
        all documentation relating to any of the foregoing; (iii) copyrights,
        copyright registrations and applications therefor and all other
        corresponding rights thereto throughout the world; (iv) industrial
        designs and any registrations and applications therefor throughout the
        world; (v) trade names, logos, common law trademarks and service marks;
        trademark and servicemark registrations and applications therefor and
        all goodwill associated therewith throughout the world, (vi) data bases
        and data collections and all rights therein throughout

                                       18

<PAGE>

        the world; (vii) all Software, all Web addresses, sites and domain
        names; (viii) any similar corresponding or equivalent rights to any one
        of the foregoing; and (ix) all documentation directly related to any of
        the foregoing.

          (o) Agreements, Contracts and Commitments; Material Contracts.  Except
     as set forth in the Section 5.1(o) of the Company Disclosure Schedule, as
     of the date of this Agreement, the Company is not a party to or bound by:

             (i) any contract relating to the borrowing of money, the guaranty
        of another Person's borrowing of money, or the creation of an
        encumbrance or lien on the assets of the Company and with outstanding
        obligations in excess of $100,000;

             (ii) any employment or consulting agreement, contract or commitment
        with any officer, director or other principal employee. Attached hereto
        as Section 5.1(o) of the Company Disclosure Schedule is a list of the
        top five compensated officers or employees as of the last fiscal year
        ended and their current salary;

             (iii) any agreement of indemnification or guaranty by the Company
        not entered into in the ordinary course of business other than
        indemnification agreements between the Company and any of its officers
        or directors in standard forms as filed by the Company with the SEC;

             (iv) any agreement, contract or commitment containing any covenant
        limiting the freedom of the Company to engage in any line of business or
        conduct business in any geographical area, compete with any person;

             (v) any joint venture, partnership, and other contract (however
        named) involving a sharing of profits or losses by the Company with any
        other Person;

             (vi) any contract for capital expenditures in excess of $50,000;

             (vii) any agreement, contract or commitment currently in force
        relating to the disposition or acquisition of assets not in the ordinary
        course of business;

             (viii) any agreement, contract or commitment for the purchase of
        any ownership interest in any corporation, partnership, joint venture or
        other business enterprise for consideration in excess of $50,000, in any
        case, which includes all escrow and earn-out agreements with outstanding
        obligations; or

             (ix) any other material contract or agreement of the Company and
        that involves payment of $50,000 or more not otherwise listed in any
        other section of the Company Disclosure Schedule.

     A true and complete copy (including all amendments) of each contract or
other agreement required to be disclosed by this Section 5.1(o) (a "Company
Material Contract") (or if standard forms are used, copies of the applicable
forms with an indication of any material differences from the actual listed
Company Material Contract), or a summary of each oral contract, has been made
available to Parent. Each Company Material Contract is in full force and effect,
and is a legal, valid and binding obligation of the Company and, to the
knowledge of the Company, each of the other parties thereto, enforceable in
accordance with its terms against the Company, except (a) that the enforcement
thereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity (regardless of whether
enforceability is considered in a proceeding in equity or at law) and (b) as
would not, individually or in the aggregate, result in a Material Adverse Effect
on the Company. No condition exists or event has occurred which (whether with or
without notice or lapse of time or both, or the happening or occurrence of any
other event) would constitute a default

                                       19

<PAGE>

by the Company of the Company or, to the knowledge of the Company, any other
party thereto under, or result in a right in termination of, any Company
Material Contract, except as would not, individually or in the aggregate, result
in a Material Adverse Effect on the Company. Except as provided for herein, at
the Effective Time, no Person will have the right, by contract or otherwise, to
become, nor does any entity have the right to designate or cause the Company to
appoint a Person as, a director of the Company.

          (p) Listings.  The Company's securities are not listed or quoted for
     trading on any U.S. domestic or foreign securities exchange other than the
     NASD OTC Bulletin Board (the "OTC").

          (q) Environmental Matters. Except as disclosed in Section 5.1(q) of
     the Company Disclosure Schedule, (i) the Company and the operations, assets
     and properties thereof are in material compliance with all Environmental
     Laws and, to the Company's knowledge, any operations, assets and properties
     formerly owned or leased by the Company were in material compliance with
     all Environmental Laws during the Company's period of ownership or
     operation; (ii) there are no judicial or administrative actions, claims,
     suits, judgments, orders, decrees, proceedings, information requests or
     investigations pending or, to the knowledge of the Company, threatened
     against the Company alleging the violation of or liability under any
     Environmental Law and the Company has not received notice from any
     Governmental Entity or Person alleging any violation of or liability under
     any Environmental Laws; (iii) to the knowledge of the Company after due
     inquiry, there are no facts, circumstances or conditions relating to,
     arising from, associated with or attributable to the Company or any real
     property currently or previously owned, operated or leased by the Company
     that could reasonably be expected to result in material Environmental Costs
     and Liabilities; and (iv) the Company has never generated, transported,
     treated, stored, recycled, handled, disposed of or released or threatened
     to release any Hazardous Material at any site, location or facility in a
     manner that has created, or, to the knowledge of the Company, could create
     any material Environmental Costs and Liabilities, and no such Hazardous
     Material has been or is currently present on, in, at or under any real
     property owned, leased or used by the Company in a manner that could create
     any material Environmental Costs and Liabilities. The Company has provided
     to Parent and Merger Sub any and all documents, correspondence, pleadings,
     reports, (including, without limitation, environmental site assessment
     reports and compliance audits), assessments, analytical results, permits,
     or other records concerning Environmental Laws, Hazardous Materials or
     other environmental subjects related to the Company or any real property
     currently or previously owned, operated or leased. For the purpose of this
     Section 5.1(q), the following terms have the following definitions: (X)
     "Environmental Costs and Liabilities" means any and all losses,
     liabilities, obligations, damages, fines, penalties, judgments, liens,
     actions, claims, diminutions in value, costs and expenses (including,
     without limitation, fees, disbursements and expenses of legal counsel,
     experts, engineers and consultants and the costs of investigation and
     feasibility studies, remedial or removal actions and cleanup activities)
     arising from or under or relating to matters covered by any Environmental
     Law; (Y) "Environmental Laws" means any and all federal, state, foreign,
     interstate, local or municipal laws, rules, orders, regulations, statutes,
     ordinances, codes, decisions, injunctions, decrees, permits, licenses,
     authorizations, requirements, directives of any Governmental Entity, any
     and all common law requirements, rules and bases of liability regulating,
     relating to or imposing liability or standards of conduct concerning
     pollution, Hazardous Materials or protection of human health, safety or the
     environment, as currently in effect and includes the Comprehensive
     Environmental Response Compensation and Liability Act, 42 U.S.C. Section
     9601 et seq., the Hazardous Materials Transportation Act, 49 U.S.C. Section
     1801 et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section
     6901 et seq., the Clean Water Act, 33 U.S.C. Section 1251 et seq., the
     Clean Air Act, 42 U.S.C.

                                       20

<PAGE>

     Section 7401 et seq., the Toxic Substances Control Act, 15 U.S.C. Section
     2601 et seq., the Federal Insecticide, Fungicide and Rodenticide Act, 7
     U.S.C. Section 136 et seq., Occupational Safety and Health Act 29 U.S.C.
     Section 651 et seq. and the Oil Pollution Act of 1990, 33 U.S.C. Section
     2701 et seq., as such laws have been amended or supplemented, and the
     regulations promulgated pursuant thereto, and all analogous state or local
     statutes; and (Z) "Hazardous Material" means any substance, material or
     waste regulated or defined by any Environmental Law, including, without
     limitation, any substance, material or waste which is defined as a
     "hazardous waste," "hazardous material," "hazardous substance," "toxic
     waste" or "toxic substance" and including but not limited to petroleum and
     petroleum products including crude oil and any fraction thereof, natural
     gas and synthetic gas and mixtures thereof, radioactive substances,
     asbestos and polychlorinated biphenyls.

          (r) Sufficient Assets; Properties.

             (i) The Company owns or leases all equipment, furniture, fixtures,
        improvements and other tangible assets necessary and sufficient for the
        conduct of its business as presently conducted.

             (ii) The Company has good and marketable title to, or a valid
        leasehold interest in, the real and personal property material to the
        operation of its business. None of such property is subject to any
        mortgage, pledge, deed of trust, lien (other than for taxes not yet due
        and payable), conditional sale agreement, security title, encumbrance,
        or other adverse claim or interest which would have a Material Adverse
        Effect on the Company. Since November 15, 2000, there has not been any
        sale, lease, or any other disposition or distribution by the Company of
        any of its assets or properties material to the Company.

             (iii) The Company does not own any real property or any interest in
        real property, except for the real property, leaseholds created under
        the real property leases and any licenses or usufructs identified in
        Section 5.1(r) of the Company Disclosure Schedule. Section 5.1(r) of the
        Company Disclosure Schedule lists such real property and the premise
        covered by such leases, as applicable. The Company enjoys peaceful and
        undisturbed possession of such premises.

             (iv) All leases or licenses, whether oral or written, pursuant to
        which the Company leases real or personal property are in good standing
        and are valid and effective in accordance with their respective terms
        and there exists no default thereunder that would have a Material
        Adverse Effect on the Company.

          (s) Labor and Employee Relations.

             (i) (A) None of the employees of the Company is represented in his
        or her capacity as an employee thereof by any labor organization; (B)
        the Company has not recognized any labor organization nor has any labor
        organization been elected as the collective bargaining agent of any of
        their employees, nor has the Company signed any collective bargaining
        agreement or union contract recognizing any labor organization as the
        bargaining agent of any of their employees; and (C) to the knowledge of
        the Company, there is no active or current union organization activity
        involving the employees of the Company, nor has there ever been union
        representation involving employees of the Company.

             (ii) As of the date of this Agreement, except for complaints which,
        in the aggregate, do not represent claims which could reasonably involve
        liabilities in excess of $25,000, there are no complaints against the
        Company pending or, to the knowledge of the Company, overtly threatened
        before the National Labor Relations Board or any similar foreign, state
        or local labor agencies, or before the Equal Employment Opportunity
        Commission or any

                                       21

<PAGE>

        similar foreign, state or local agency, or before any other governmental
        agency or entity by or on behalf of any employee or former employee of
        the Company and at Closing there will be no such pending or threatened
        complaints that either individually or in the aggregate would have a
        Material Adverse Effect on the Company.

             (iii) The Company has provided to Parent a description of all
        written employment policies under which the Company is currently
        operating.

          (t) Licenses and Other Authorizations. The Company holds all material
     licenses, permits, registrations, orders, franchises, approvals and other
     authorizations, including those issued by any state or other regulatory
     authority, which are necessary to permit it to conduct its businesses as
     presently conducted ("Necessary Authorizations"). All such Necessary
     Authorizations are now, and will be after the Closing, valid and in full
     force and effect, and the Surviving Corporation shall have full benefit of
     the same. The Company has not received any notification of any asserted
     present failure (or past and unremedied failure) by it to have obtained any
     Necessary Authorization. Except as disclosed on the Company Disclosure
     Schedule, no fines or other penalties exceeding $1,000 individually or
     $10,000 in the aggregate have been assessed against the Company in any of
     the last five years relating to its business activities.

          (u) Transactions with Affiliates. Since the date of Company's last
     proxy statement to its stockholders, no event has occurred that would be
     required to be reported by Company as a Certain Relationship or Related
     Transaction, pursuant to Item 404 of Regulation S-K promulgated by the SEC.

          (v) Year 2000. The Company has implemented a program directed at
     ensuring that its products (including prior and current products and
     technology and products and technology currently under development) will,
     when used in accordance with associated documentation on a specified
     platform or platforms, be capable upon installation of (i) operating in the
     same manner on dates in both the Twentieth and Twenty-First centuries and
     (ii) accurately processing, providing and receiving date data from, into
     and between the Twentieth and Twenty-First centuries, including the years
     1999 and 2000, and making leap-year calculations. The Company has taken
     commercially reasonable steps to assure that the year 2000 date change will
     not adversely affect, and such date change has not adversely affected the
     systems and facilities that support the operations of the Company, except
     as would not have a Material Adverse Effect on the Company.

          (w) State Takeover Laws. The Board of Directors of the Company has
     taken all necessary action so that the restrictions contained in Section
     23B.19.040 of the WBCA applicable to a "significant business transaction"
     (as defined in Section 23B.19.020(15)) will not apply to the execution,
     delivery or performance of this Agreement or the Voting Agreement or the
     consummation of the Merger or the other transactions contemplated by this
     Agreement or the Voting Agreements. No other state takeover statute or
     similar statute or regulation is applicable to this Agreement or the Voting
     Agreements.

          (x) Shareholder Rights Plan. There is no shareholder rights plan or
     similar plan of the Company in effect that would cause additional
     securities of the Company or the right to receive such securities to be
     issued to some or all of the present holders of the Company Shares by
     reason of this Agreement or the consummation of the transactions
     contemplated hereby.

     5.2  Representations and Warranties of Parent and Merger Sub.  Parent and
Merger Sub hereby represent and warrant to the Company that the statements
contained in this Section 5.2 are true and correct, except to the extent
specifically set forth on the disclosure schedule delivered by Parent to the
Company (the "Parent Disclosure Schedule"). The Parent Disclosure Schedule shall
be

                                       22

<PAGE>

arranged in sections and paragraphs corresponding to the letter and numbered
paragraphs contained in this Section 5.2, and the disclosure in any paragraph
shall qualify only the corresponding paragraph in this Section 5.2 or other
paragraphs or sections to which it is clearly apparent (from a plain reading of
the disclosure) that such disclosure relates.

          (a) Corporate Organization and Qualification. Each of Parent and
     Merger Sub is a corporation duly organized, validly existing and in good
     standing under the laws of the jurisdiction of incorporation or
     organization and is duly qualified and in good standing as a foreign
     corporation in each jurisdiction where the properties owned, leased or
     operated, or the business conducted, by it require such qualification,
     except where failure to so qualify or be in good standing as a foreign
     corporation would not have a Material Adverse Effect on Parent. Merger Sub
     is a direct, wholly-owned subsidiary of Parent, was formed solely for the
     purpose of engaging in the transactions contemplated hereby, has engaged in
     no other business activities and has conducted its operations only as
     contemplated hereby.

          (b) Capitalization. As of the date of this Agreement, the authorized
     capital stock of Parent consists of (i) 25,000,000 shares of common stock,
     $0.01 par value per share, of which 8,355,721 shares were issued and
     outstanding as of January 26, 2001, and (ii) 5,000,000 shares of preferred
     stock, $0.01 par per share, none of which are issued or outstanding. All of
     the outstanding shares of capital stock of Parent are, and when Parent
     Shares are issued in the Merger such shares will be, duly authorized,
     validly issued, fully paid and nonassessable and free of any preemptive or
     similar rights. Except as set forth in the Parent SEC Reports, the Parent
     has no outstanding stock appreciation rights, phantom stock, restricted
     stock or similar rights. As of the date of this Agreement, except as set
     forth in the Parent SEC Reports, there are no outstanding or authorized
     options, warrants, calls, rights (including preemptive rights), commitments
     or any other agreements of any character to which the Parent is a party, or
     by which the Parent may be bound, requiring it to issue, transfer, grant
     sell, purchase, redeem or acquire any shares of capital stock or any of its
     securities or rights convertible into, exchangeable for, or evidencing the
     right to subscribe for, any shares of capital stock of the Parent. The
     transactions contemplated by this Agreement will not accelerate the vesting
     of any options, warrants or similar rights for the purchase of the Parent
     Shares.

          (c) Authority Relative to this Agreement. The Board of Directors of
     Parent has declared the issuance of Parent Shares advisable and Parent has
     the requisite corporate power and authority to approve, authorize, execute
     and deliver this Agreement and to consummate the transactions contemplated
     hereby. Merger Sub has the requisite corporate power and authority to
     approve, authorize, execute and deliver this Agreement and to consummate
     the transactions contemplated hereby. This Agreement and the consummation
     by Parent of the transactions contemplated hereby have been duly and
     validly authorized by the Boards of Directors of Parent and Merger Sub and
     no other corporate proceedings on the part of Parent or Merger Sub
     (including, in the case of Merger Sub, all stockholder action by Parent as
     its sole stockholder) are necessary to authorize this Agreement or to
     consummate the transactions contemplated hereby. This Agreement has been
     duly and validly executed and delivered by Parent and Merger Sub and,
     assuming this Agreement constitutes the valid and binding agreement of the
     Company, constitutes the valid and binding agreement of Parent and Merger
     Sub, enforceable against Parent and Merger Sub in accordance with its
     terms, subject, as to enforceability, to bankruptcy, insolvency,
     reorganization and other laws of general applicability relating to or
     affecting creditors' rights and to general principles of equity.

          (d) Present Compliance with Obligations and Laws.  Neither Parent nor
     any of its subsidiaries is: (i) in violation of its certificate of
     incorporation, bylaws or similar documents; (ii) in default in the
     performance of any obligation, agreement or condition of any debt

                                       23

<PAGE>

     instrument which (with or without the passage of time or the giving of
     notice, or both) affords to any Person the right to accelerate any
     indebtedness or terminate any right; (iii) in default under or breach of
     (with or without the passage of time or the giving of notice) any other
     contract to which it is a party or by which it or its assets are bound; or
     (iv) in violation of any law, regulation, administrative order or judicial
     order, decree or judgment (domestic or foreign) applicable to it or its
     business or assets, except where any violation, default or breach under
     clauses (iii) or (iv) or, with respect to the Parent's subsidiaries only,
     clause (i) would not, individually or in the aggregate, have a Material
     Adverse Effect on Parent.

          (e) Consents and Approvals; No Violation. Neither the execution and
     delivery of this Agreement nor the consummation by Parent of the
     transactions contemplated hereby will (i) conflict with or result in any
     breach of any provision of the respective certificate of incorporation (or
     other similar documents) or bylaws (or other similar documents) of Parent
     or any of its subsidiaries; (ii) require any consent, approval,
     authorization or permit of, or registration or filing with or notification
     to, any Governmental Entity, except (A) in connection with the applicable
     requirements of the HSR Act, (B) pursuant to the applicable requirements of
     the Securities Act and the rules and regulations promulgated thereunder,
     and the Exchange Act and the rules and regulations promulgated thereunder,
     (C) the filing of the Certificate of Merger pursuant to the DGCL and
     appropriate documents with the relevant authorities of other states in
     which Merger Sub is authorized to do business, (D) as may be required by
     any applicable state securities or "blue sky" laws, or (E) where the
     failure to obtain such consent, approval, authorization or permit, or to
     make such filing or notification, would not, individually or in the
     aggregate, have a Material Adverse Effect on Parent; (iii) result in a
     violation or breach of, or constitute (with or without notice or lapse of
     time or both) a default (or give rise to any right of termination,
     cancellation or acceleration or lien or other charge or encumbrance) under
     any of the terms, conditions or provisions of any indenture, note, license,
     lease, agreement or other instrument or obligation to which Parent or any
     of its subsidiaries is a party or by which any of their assets may be
     bound, except for such violations, breaches and defaults (or rights of
     termination, cancellation or acceleration or lien or other charge or
     encumbrance) as to which requisite waivers or consents have been obtained
     or which, individually or in the aggregate, would not have a Material
     Adverse Effect on Parent; (iv) cause the suspension or revocation of any
     authorizations, consents, approvals or licenses currently in effect which
     would have a Material Adverse Effect on Parent; or (v) assuming the
     consents, approvals, authorizations or permits and filings or notifications
     referred to in this Section 5.2(e) are duly and timely obtained or made,
     violate any order, writ, injunction, decree, statute, rule or regulation
     applicable to Parent or any of its subsidiaries or to any of their
     respective assets, except for violations which would not, individually or
     in the aggregate, have a Material Adverse Effect on Parent.

          (f) Litigation. There are no actions, suits, claims, investigations or
     proceedings pending or, to the knowledge of Parent, threatened against
     Parent or any of its subsidiaries that, alone or in the aggregate would be
     reasonably likely to result in obligations or liabilities of Parent or any
     of its subsidiaries that, individually or in the aggregate, would have a
     Material Adverse Effect on Parent. Neither Parent nor any of its
     subsidiaries is subject to any outstanding order, writ, injunction or
     decree which (i) has or may have the effect of prohibiting or impairing any
     business practice of Parent or any of its subsidiaries, any acquisition of
     property (tangible or intangible) by Parent or any of its subsidiaries, the
     conduct of the business by Parent or any of its subsidiaries, or Parent's
     or Merger Sub's ability to perform its obligations under this Agreement or
     (ii) insofar as can be reasonably foreseen, individually or in the
     aggregate, would have a Material Adverse Effect on Parent.

          (g) SEC Reports; Financial Statements.

                                       24

<PAGE>

             (i) Since October 31, 2000, Parent has filed all forms, reports and
        documents with the SEC required to be filed by it pursuant to the
        federal securities laws and the SEC rules and regulations thereunder,
        all of which complied in all material respects with all applicable
        requirements of the Securities Act and the Exchange Act and the rules
        and regulations promulgated thereunder (collectively, the "Parent SEC
        Reports"). None of the Parent SEC Reports, including, without
        limitation, any financial statements or schedules included therein, at
        the time filed (or if amended or superseded by a filing prior to the
        date of this Agreement, then on the date of such filing) contained any
        untrue statement of a material fact or omitted to state a 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 misleading. None of Parent's subsidiaries is required to file
        any forms, reports or other documents with the SEC.

             (ii) The consolidated balance sheets and the related consolidated
        statements of income, stockholders' equity and cash flows (including the
        related notes thereto) of Parent included in the Parent SEC Reports
        (collectively, "Parent Financial Statements") comply as to form in all
        material respects with applicable accounting requirements and the
        published rules and regulations of the SEC with respect thereto, have
        been prepared in accordance with GAAP applied on a basis consistent
        throughout the periods involved (except as otherwise noted therein or,
        in the case of unaudited interim financial statements, as may be
        permitted by the SEC on Form 10-Q under the Exchange Act), and present
        fairly the consolidated financial position of Parent and its
        consolidated subsidiaries as of their respective dates, and the
        consolidated results of their operations and their cash flows for the
        periods presented therein (subject, in the case of the unaudited interim
        financial statements, to normal and recurring year-end adjustments).
        Since October 31, 2000, there has not been any material change, by
        Parent or any of its subsidiaries, in accounting principles, methods or
        policies for financial accounting purposes except as required by
        concurrent changes in GAAP.

          (h) No Liabilities; Absence of Certain Changes or Events. Neither
     Parent nor any of its subsidiaries has any material indebtedness,
     obligations or liabilities of any kind (whether accrued, absolute,
     contingent or otherwise, and whether due or to become due or asserted or
     unasserted), and, to knowledge of Parent, there is no reasonable basis for
     the assertion of any material claim or liability of any nature against
     Parent or any of its subsidiaries, except for liabilities (i) which are
     fully reflected in, reserved against or otherwise described in the Parent
     Financial Statements for the period ending October 31, 2000, (ii) which
     have been incurred after October 31, 2000 in the ordinary course of
     business, consistent with past practice, or (iii) which, individually or in
     the aggregate, would not reasonably be expected to have a Material Adverse
     Effect on Parent. Since October 31, 2000, the business of Parent and its
     subsidiaries has been carried on only in the ordinary and usual course, and
     there has not been any Material Adverse Effect on Parent.

          (i) Brokers and Finders. Neither Parent nor any of its subsidiaries
     has employed any investment banker, broker, finder, consultant or
     intermediary in connection with the transactions contemplated by this
     Agreement which would be entitled to any investment banking, brokerage,
     finder's or similar fee or commission in connection with this Agreement or
     the transactions contemplated hereby.

          (j) The Registration Statements and Proxy Statement/Prospectus. None
     of the information supplied or to be supplied by Parent or Merger Sub for
     inclusion or incorporation by reference in the Registration Statements will
     (i) in the case of each of the Registration Statements, at the time they
     become effective or at the Effective Time, contain any untrue statement of
     a material fact or omit to state any material fact required to be stated
     therein or

                                       25

<PAGE>

     necessary in order to make the statements therein not misleading, or (ii)
     in the case of the Proxy Statement, at the time of the mailing of the Proxy
     Statement and at the time of the Company Stockholder Meeting, contain any
     untrue statement of a material fact or omit to state any material fact
     required to be stated therein or necessary in order to make the statements
     therein, in light of the circumstances under which they are made, not
     misleading. If at any time prior to the Effective Time any event with
     respect to Parent, Merger Sub or any of their respective affiliates,
     officers and directors or any of its subsidiaries should occur which is
     required to be described in an amendment of, or a supplement to, the
     Registration Statements, Parent shall promptly inform the Company, such
     event shall be so described, and such amendment or supplement shall be
     promptly filed with the SEC and, as required by law, disseminated to the
     stockholders of the Company. Each of the Registration Statements will (with
     respect to Parent and Merger Sub) comply as to form in all material
     respects with the requirements of the Securities Act and the rules and
     regulations promulgated thereunder. The Proxy Statement will (with respect
     to Parent and Merger Sub) comply as to form in all material respects with
     the requirements of the Exchange Act and the rules and regulations
     promulgated thereunder. Notwithstanding the foregoing provisions of this
     Section 5.2(j), no representation or warranty is made by Parent or Merger
     Sub with respect to statements made or incorporated by reference in the
     Registration Statements based on information supplied by the Company for
     inclusion or incorporation by reference therein.

          (k) Parent Intangible Property.

             (i) Parent owns, or possesses a valid and enforceable license or
        otherwise possesses legally enforceable rights to use, all material
        Parent Intellectual Property Rights (as hereafter defined) that are
        necessary to conduct the business of the Parent as currently conducted
        or planned to be conducted and has no restriction on the rights to use
        the same.

             (ii) Section 5.2(k)(ii) of the Parent Disclosure Schedule contains
        a list and description of all material Parent Intellectual Property
        Rights.

             (iii) Section 5.2(k)(iii) of the Parent Disclosure Schedule
        contains a list and description (showing in each case any licensee) of
        all Software owned by or licensed to the Parent excluding Software
        licensed to the Parent having a fee less than five thousand dollars
        ($5,000).

             (iv) Section 5.2(k)(iv) of the Parent Disclosure Schedule contains
        a list and description (showing in each case the parties thereto) of all
        material agreements, contracts, licenses, sublicenses, assignments and
        indemnities which relate to (A) any copyright, patent right, servicemark
        or trademark listed in Section 5.2(k)(ii) of the Parent Disclosure
        Schedule, (B) any trade secrets owned by, licensed to or used by the
        Parent or (C) any Software listed in Section 5.2(k)(iii) of the Parent
        Disclosure Schedule.

             (v) The Parent is not nor will be as a result of the execution and
        delivery of this Agreement or the performance of its obligations under
        this Agreement, in breach in any material respect of any license,
        sublicense or other agreement relating to the Parent Intellectual
        Property Rights or any license, sublicense or other agreement pursuant
        to which the Parent is authorized to use any third party patents,
        trademarks or copyrights, including Software, which are used in the
        manufacture of, incorporated in, or form a part of any product of the
        Parent. All such agreements of the Parent are listed in Section
        5.2(k)(v) of the Parent Disclosure Schedule.

             (vi) (A) All material patents, registered trademarks, service marks
        and copyrights held by the Parent are valid and enforceable and any and
        all applications to register any unregistered copyrights, patent rights,
        servicemarks and trademarks to identified are pending

                                       26

<PAGE>

        and in good standing; and (B) the Parent has the sole and exclusive
        right to bring actions for infringement or unauthorized use of the
        material Parent Intellectual Property Rights and Software owned by the
        Parent, and the Parent has no knowledge of any basis for any such
        action. To the best of Parent's knowledge, the Parent has not been sued
        in any suit, action or proceeding which involves a claim of infringement
        of any patent, trademark, service mark or copyright or the violation of
        any trade secret or other proprietary rights of any third party. To the
        best of Parent's knowledge, the conduct of the business of the Parent
        does not violate or infringe any intellectual property rights owned or
        controlled by any third party, and there are no claims, proceedings or
        actions pending or, to the knowledge of the Parent, threatened against
        the Parent (A) alleging that the Parent's activities infringe upon,
        violate or otherwise constitute the unauthorized use of any intellectual
        property rights of any third party or (B) challenging the ownership,
        use, validity or enforceability of any Parent Intellectual Property
        Rights, nor is there a valid basis for any such claim to the best of
        Parent's knowledge.

             (vii) The Parent has taken reasonable measures to safeguard and
        maintain their proprietary rights in all Parent Intellectual Property
        Rights owned by the Parent. There has been no disclosure of any trade
        secret of the Parent to any third party, other than pursuant to valid,
        enforceable, written non-disclosure agreements.

             (viii) The completion of the transactions contemplated by this
        Agreements will not alter or impair the right of the Parent to use any
        of the Parent Intellectual Property Rights.

             (ix) All material Parent Intellectual Property Rights owned by the
        Parent have been (A) acquired from a person or entity having full,
        effective and exclusive ownership thereof, (B) developed or created by
        employees, agents, consultants or contractors who have contributed to or
        participated in the creation or development of any copyrightable,
        patentable or trade secret material on behalf of the Parent or any
        predecessor in interest thereof either: (1) with respect to
        copyrightable materials, is a party to a "work-for-hire" agreement under
        which the Parent or any predecessor in interest thereof is deemed to be
        the original owner/author of all property rights therein; or (2) with
        respect to copyrightable or patentable materials or materials subject to
        trade secret protection, has executed an assignment or an agreement to
        assign in favor of the Parent or any predecessor in interest thereof, of
        all right, title and interest in such material.

             (x) Excluding the Software identified in Section 5.2(k)(x) of the
        Parent Disclosure Schedule, (A) the Software owned or exclusively
        licensed by the Parent is not subject by agreement to any transfer,
        assignment, site, equipment, or other operational limitations; (B) the
        Parent has maintained and protected the Software that it owns (the
        "Parent Owned Software") (including, without limitation, all source code
        and system specifications) with appropriate proprietary notices
        (including, without limitation, the notice of copyright in accordance
        with the requirements of 17 U.S.C. sec. 401), confidentiality and
        non-disclosure agreements and such other measures as are reasonably
        necessary to protect the proprietary, trade secret or confidential
        information contained therein; (C) the material Parent Owned Software
        has been registered or is eligible for protection and registration under
        applicable U.S. copyright law and has not been forfeited to the public
        domain; (D) the Parent has copies of all releases or separate versions
        of the Parent Owned Software so that the same may be subject to
        registration in the United States Copyright Office; (E) the Parent has
        complete and exclusive right, title and interest in and to the Parent
        Owned Software; (F) the Parent has developed the Parent Owned Software
        through its own efforts and for its own account or has otherwise
        acquired title thereto; (G) to the best of the Parent's knowledge, the
        Parent Owned Software does not infringe any copyright of any other
        Person;

                                       27

<PAGE>

        (H) any Parent Owned Software includes the source code, system
        documentation, statements of principles of operation and schematics, as
        well as any pertinent commentary, explanation, program (including
        compilers), workbenches, tools, and higher level (or "proprietary")
        language used for the development, maintenance, implementation and use
        thereof, so that a trained computer programmer could develop, maintain,
        support, compile and use all releases or separate versions of the same
        that are currently subject to maintenance obligations by the Parent; and
        (i) there are no agreements or arrangements in effect with respect to
        the marketing, distribution, licensing or promotion of the Parent Owned
        Software by any other Person.

             (xi) "Parent Intellectual Property Rights" means any or all of the
        following and all rights in, arising out of, or associated therewith,
        whether registered or unregistered, as applicable: (i) United States and
        foreign patents and applications therefor and all reissues, divisions,
        renewals, extensions, provisionals, continuations and
        continuations-in-part thereof; (ii) inventions and discoveries (whether
        or not patentable), disclosures, trade secrets, formulae, methods,
        proprietary information, know-how technical data and customer lists, and
        all documentation relating to any of the foregoing; (iii) copyrights,
        copyright registrations and applications therefor and all other
        corresponding rights thereto throughout the world; (iv) industrial
        designs and any registrations and applications therefor throughout the
        world; (v) trade names, logos, common law trademarks and service marks;
        trademark and servicemark registrations and applications therefor and
        all goodwill associated therewith throughout the world, (vi) data bases
        and data collections and all rights therein throughout the world; (vii)
        all Software, all Web addresses, sites and domain names; (viii) any
        similar corresponding or equivalent rights to any one of the foregoing;
        and (ix) all documentation directly related to any of the foregoing.

          (l) Agreements, Contracts and Commitments; Material Contracts.  Except
     as set forth in the Section 5.2(l) of the Parent Disclosure Schedule, as of
     the date of this Agreement, the Parent is not a party to or bound by:

             (i) any contract relating to the borrowing of money, the guaranty
        of another Person's borrowing of money, or the creation of an
        encumbrance or lien on the assets of the Parent and with outstanding
        obligations in excess of $100,000;

             (ii) any agreement of indemnification or guaranty by the Parent not
        entered into in the ordinary course of business other than
        indemnification agreements between the Parent and any of its officers or
        directors in standard forms as filed by the Parent with the SEC;

             (iii) any agreement, contract or commitment containing any covenant
        limiting the freedom of the Parent to engage in any line of business or
        conduct business in any geographical area, compete with any person;

             (iv) any material joint venture, partnership, and other contract
        (however named) involving a sharing of profits or losses by the Parent
        with any other Person;

             (v) any contract for capital expenditures in excess of $50,000;

             (vi) any agreement, contract or commitment currently in force
        relating to the disposition or acquisition of assets not in the ordinary
        course of business; or

             (vii) any other material contract or agreement of the Parent and
        that involves payment of $50,000 or more not otherwise listed in any
        other section of the Parent Disclosure Schedule.

                                       28

<PAGE>

     No condition exists or event has occurred which (whether with or without
notice or lapse of time or both, or the happening or occurrence of any other
event) would constitute a default by the Parent of the Parent or, to the
knowledge of the Parent, any other party thereto under, or result in a right in
termination of, any contract listed herein, except as would not, individually or
in the aggregate, result in a Material Adverse Effect on the Parent. Except as
provided for herein, at the Effective Time, no Person will have the right, by
contract or otherwise, to become, nor does any entity have the right to
designate or cause the Parent to appoint a Person as, a director of the Parent.

          (m) Listings. The Parent's securities are not listed or quoted for
     trading on any U.S. domestic or foreign securities exchange other than the
     NASDAQ (as hereafter defined) and the Parent is in material compliance with
     the rules and regulations of the NASD with respect to such listing.

          (n) Taxes. Other than as disclosed in Section 5.2(n) of the Parent
     Disclosure Schedule, (i) Parent and each of its subsidiaries have filed all
     Tax Returns required to be filed by it or requests for extensions to file
     such Tax Returns have been timely filed, granted and have not expired,
     except to the extent that such failures to file or to have extensions
     granted that remain in effect do not have a Material Adverse Effect; (ii)
     all Tax Returns filed by Parent and each of its subsidiaries are complete
     and accurate except to the extent that such failure to be complete and
     accurate does not have a Material Adverse Effect; (iii) Parent and each of
     its subsidiaries have paid (or Parent has paid on the subsidiaries' behalf)
     all Taxes shown as due on such returns (and all Taxes required to be paid
     whether or not shown as due on such returns, except to the extent that the
     failure to pay unreported Taxes does not have a material Adverse Effect),
     and the most recent financial statements contained in the Parent SEC
     Reports reflect an adequate reserve, in accordance with GAAP, for all Taxes
     payable by Parent and its subsidiaries for all taxable periods and portions
     thereof accrued through the date of such financial statements; (iv) no
     deficiencies for any Taxes have been proposed, asserted or assessed against
     Parent or any of its subsidiaries that are not adequately reserved for,
     except for deficiencies that do not have a Material Adverse Effect, and no
     requests for waivers of the time to assess any such Taxes have been granted
     or are pending; (v) the Parent has made adequate provisions in the Parent's
     books and records for Taxes with respect to its current taxable year; (iv)
     there is no claim or assessment pending against Parent or any of its
     subsidiaries for any alleged deficiency in Taxes (except for assessments
     assessed prior to the date payment is required); and (vii) to the knowledge
     of Parent there is no audit or investigation currently being conducted that
     could cause Parent or any of its subsidiaries to be liable for any Taxes
     and there are no agreements in effect to extend the period of limitations
     for the assessment or collection of any tax for which Parent or any of its
     subsidiaries may be liable, and (viii) parent is not a party to any
     agreement that would require it to make any excess parachute payment
     pursuant to Section 280G of the Code. "Tax Returns" means returns, reports
     and information statements with respect to Taxes required to be filed with
     the IRS or any other federal, state or local taxing authority domestic or
     foreign, including without limitation, consolidated, combined unitary and
     estimated tax returns.

                                   ARTICLE VI

                       ADDITIONAL COVENANTS AND AGREEMENTS

     6.1  Conduct of Business of the Company.

          (a) The Company covenants and agrees that, during the period from the
     date of this Agreement to the Effective Time (unless the Parties shall
     otherwise agree in writing and except as otherwise contemplated by this
     Agreement) it will conduct its operations according to its ordinary and
     usual course of business consistent with past practice and, to the extent
     consistent

                                       29

<PAGE>

     therewith, with no less diligence and effort than would be applied in the
     absence of this Agreement, seek to preserve intact its current business
     organizations, use its best efforts to keep available the service of its
     current officers and employees and preserve its relationships with
     customers and others having business dealings with it to the end that
     goodwill and ongoing businesses shall be unimpaired at the Effective Time.

          (b) Without limiting the generality of the foregoing, and except as
     otherwise permitted in this Agreement, prior to the Effective Time, the
     Company shall not without the prior written consent of Parent, which will
     not be unreasonably withheld:

             (i) accelerate, amend or change the period of exercisability or
        vesting of any outstanding options or other rights granted under the
        Company Option Plans, reprice options granted under the Company Option
        Plans or authorize cash payments in exchange for any options or other
        rights granted under any of such plans, as the case may be, or authorize
        cash payments in exchange for any options or other rights granted under
        any of such plans, except to the extent required under any Company
        Option Plan or any individual agreement as in effect on the date of this
        Agreement;

             (ii) except for shares to be issued upon (A) exercise of
        outstanding options as contemplated pursuant to Section 6.14, (B)
        exercise of outstanding warrants, or (C) delivery of the number of
        Company Shares to National Financial Communications Corp, doing business
        as OTC Financial Network, a Massachusetts corporation ("NFCC"), in
        connection with the Company's termination of that certain Consulting
        Agreement by and between the Company and NFCC, dated as of November 6,
        2000, determined in accordance with the terms and conditions thereof,
        issue, deliver, sell, dispose of, pledge or otherwise encumber, or
        authorize or propose the issuance, sale, disposition or pledge or other
        encumbrance of (1) any additional shares of capital stock of any class,
        or any securities or rights convertible into, exchangeable for, or
        evidencing the right to subscribe for any shares of capital stock, or
        any rights, warrants, options, calls, commitments or any other
        agreements of any character to purchase or acquire any shares of capital
        stock or any securities or rights convertible into, exchangeable for, or
        evidencing the right to subscribe for, any shares of capital stock, or
        (2) any other securities in respect of, in lieu of, or in substitution
        for, shares outstanding on the date of this Agreement;

             (iii) redeem, purchase or otherwise acquire, or offer to redeem,
        purchase or otherwise acquire, any of its outstanding securities
        (including the Company Shares), other than the Debentures and Debenture
        Warrants (as hereafter defined);

             (iv) split, combine, subdivide or reclassify any shares of its
        capital stock or declare, set aside for payment or pay any dividend, or
        make any other actual, constructive or deemed distribution in respect of
        any shares of its capital stock;

             (v) adopt a plan of complete or partial liquidation, dissolution,
        merger, consolidation, restructuring, recapitalization or other
        reorganization (other than the Merger as provided for herein);

             (vi) adopt any amendments to its articles of incorporation or
        bylaws or alter through merger, liquidation, reorganization,
        restructuring or in any other fashion the corporate structure or
        ownership of any of its subsidiaries;

             (vii) make any acquisition, by means of merger, consolidation or
        otherwise, or dispositions, of assets or securities (except for
        acquisitions or dispositions in the ordinary course of business, none of
        which are acquisitions or dispositions of businesses);

                                       30

<PAGE>

             (viii) other than in the ordinary course of business consistent
        with past practice, incur any indebtedness for borrowed money or
        guarantee any such indebtedness or make any loans, advances or capital
        contributions to, or investments in, any other Person;

             (ix) make or revoke any material Tax election, settle or compromise
        any material federal, state, local or foreign Tax liability or change
        (or make a request to any taxing authority to change) any material
        aspect of its method of accounting for Tax purposes (except for Tax
        elections which are consistent with prior such elections (in past
        years));

             (x) incur any material liability for Taxes other than in the
        ordinary course of business;

             (xi) incur or commit to incur any capital expenditures in excess of
        current budgets for capital expenditures which were provided by the
        Company to Parent prior to the date of this Agreement;

             (xii) enter into, amend, modify, terminate (partially or
        completely), grant any waiver under or give any comment with respect to
        any contract or license not consistent with past practices of the
        Company;

             (xiii) enter into any strategic alliance or joint marketing
        arrangement or agreement other than routine alliances, arrangements or
        agreements;

             (xiv) pay, discharge, settle or satisfy any material claims,
        liabilities or obligations (absolute, accrued, asserted or unasserted,
        contingent or otherwise) or litigation (whether or not commenced prior
        to the date of this Agreement), other than the payment, discharge,
        settlement or satisfaction in the ordinary course of business consistent
        with past practice;

             (xv) except as required by this Agreement or as required to be held
        in accordance with a valid stockholder request, call or hold any meeting
        of stockholders of the Company;

             (xvi) transfer or license to any Person or entity or otherwise
        extend, amend or modify any Company Intellectual Property Rights other
        than in the ordinary course of business consistent with past practices;

             (xvii) make any change to accounting policies or procedures, except
        as may be required by GAAP or applicable law;

             (xviii) take any action (other than pursuant to this Agreement) to
        cause the Company Shares not to be eligible for trading on the OTC;

             (xix) take any action to render inapplicable, or to exempt any
        third party from, any statute referred to in Section 5.1(v);

             (xx) authorize, recommend, propose or announce an intention to do
        any of the foregoing, or enter into any contract, agreement, commitment
        or arrangement to do any of the foregoing.

          (c) Between the date of this Agreement and the Effective Time, the
     Company shall not (without the prior written consent of Parent): (A) except
     for normal increases in the ordinary course of business consistent with
     past practice that, in the aggregate, do not materially increase benefits
     or compensation expenses of the Company, or as required by the terms of any
     contract disclosed pursuant to this Agreement, increase the compensation,
     bonus or other benefits payable or to become payable to any director,
     officer, other employee or independent contractor; (B) except as required
     to comply with applicable law, pay or agree to pay any pension, retirement
     allowance or other employee benefit not provided for by (or in a manner or
     at a time not provided in) any of the existing benefit, severance, pension
     or employment plans, agreements or arrangements as in effect on the date of
     this Agreement to any such director, officer,

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<PAGE>

     employee or independent contractor, whether past or present; (C) enter into
     any new or amend any existing employment or severance agreement with or for
     the benefit of any such director, officer, employee or independent
     contractor; (D) become obligated under any new pension plan, welfare plan,
     multi-employer plan, employee benefit plan, severance plan, benefit
     arrangement, or similar plan or arrangement, which was not in existence on
     the date of this Agreement, or amend, terminate or change any funding
     policies or assumptions for any such plan or arrangement in existence on
     the date of this Agreement if such amendment, termination or change would
     have the effect of enhancing any benefits thereunder or increasing the cost
     thereof to the Company; or (E) increase the total head count of Company in
     an amount greater than an increase in the ordinary course of business
     consistent with past practice.

          (d) Between the date of this Agreement and the Effective Time, the
     Company will use commercially reasonable best efforts to maintain in full
     force and effect all of its presently existing policies of insurance or
     insurance comparable to the coverage afforded by such policies.

     6.2  No Solicitation.

          (a) The Company shall immediately cease and terminate any existing
     solicitation, initiation, encouragement, activity, discussion or
     negotiation with any Persons conducted heretofore by the Company or any of
     its Representatives (as hereafter defined) with respect to any proposed,
     potential or contemplated Acquisition Proposal (as hereafter defined).

          (b) From and after the date of this Agreement, without the prior
     written consent of Parent, the Company will not, will not authorize, and
     shall use its reasonable best efforts to cause all of its officers,
     directors, employees, financial advisors, agents or representatives (each a
     "Representative") not to, directly or indirectly, solicit, initiate or
     encourage (including by way of furnishing information) or take any other
     action to facilitate any inquiries or the making of any proposal which
     constitutes or may reasonably be expected to lead to an Acquisition
     Proposal from any Person (a "Third Party"), or engage in any discussion or
     negotiations relating thereto or accept any Acquisition Proposal.

          (c) Notwithstanding the provisions of Section 6.2(b) above, at any
     time prior to obtaining the Company Stockholder Approval as contemplated by
     Section 6.3 hereof, the Company may, in response to an unsolicited written
     offer or proposal with respect to a potential or proposed Acquisition
     Proposal (that does not violate Sections 6.2(a) or (b)) engage in
     negotiations or discussions with, or provide information or data to, any
     Third Party relating to any Acquisition Proposal if the Company's Board of
     Directors determines in good faith, upon advice from outside legal counsel
     to the Company, that such Acquisition Proposal constitutes a Superior
     Proposal and such action is required to comply with its fiduciary duties
     under applicable law. Subject to all of the foregoing requirements, the
     Company will immediately notify Parent orally and in writing if any
     discussions or negotiations are sought to be initiated, any inquiry or
     proposal is made, or any information is requested by any Third Party with
     respect to any Acquisition Proposal or which could lead to an Acquisition
     Proposal and immediately notify Parent of all material terms of any
     Acquisition Proposal, including the identity of the Third Party making the
     Acquisition Proposal or the request for information, if known, and
     thereafter shall inform Parent on a timely, ongoing basis of the status and
     content of any discussions or negotiations with a Third Party, including
     immediately reporting any changes to the terms and conditions of the
     Acquisition Proposal.

          (d) In the event the Board of Directors of the Company has determined
     that any Acquisition Proposal constitutes a Superior Proposal (as
     determined in accordance with Section 6.2(c)), (i) the Company shall
     promptly notify the Parent thereof and (ii) for a period of five days after
     delivery of such notice, the Company and its Representatives, if requested
     by

                                       32

<PAGE>

     Parent, shall negotiate in good faith with Parent to make such adjustments
     to the terms and conditions of this Agreement as would enable the Company
     to proceed with the Merger on such adjusted terms. After such five day
     period, the Board of Directors of the Company may then (and only then)
     withdraw or modify its approval or recommendation of the Merger and this
     Agreement and recommend such Superior Proposal.

          (e) The Company agrees not to release any Third Party from, or waive
     any provision of, any standstill agreement to which it is a party or any
     confidentiality agreement between it and another Person who has made, or
     who may reasonably be considered likely to make, an Acquisition Proposal or
     who the Company or any of its Representatives have had discussions with
     regarding a proposed, potential or contemplated Company Acquisition
     Transaction unless the Company's Board of Directors shall conclude, in good
     faith, that such action will lead to a Superior Proposal and that, after
     receiving advice from outside legal counsel to the Company, such action is
     required for the Board of Directors to comply with its fiduciary duties
     under applicable law.

          (f) For purposes of this Agreement:

             (i) "Acquisition Proposal" shall mean, with respect to the Company,
        any bona fide inquiry, proposal or offer from any Third Party relating
        to any (A) direct or indirect acquisition or purchase of a business of
        the Company, that constitutes 20% or more of the net revenues, net
        income or assets of the Company, (B) direct or indirect acquisition or
        purchase of 15% or more of any class of equity securities of the Company
        whose business constitutes 20% or more of the net revenues, net income
        or assets of the Company, (C) tender offer or exchange offer that if
        consummated would result in any person beneficially owning 20% or more
        of the capital stock of the Company, or (D) merger, consolidation,
        business combination, recapitalization, liquidation, dissolution or
        similar transaction involving the Company whose business constitutes 20%
        or more of the consolidated net revenues, net income or assets of the
        Company.

             (ii) Each of the transactions referred to in clauses (A) through
        (D) of the definition of Acquisition Proposal, other than any such
        transaction to which Parent or any of its subsidiaries is a party, is
        referred to herein as a "Company Acquisition Transaction."

             (iii) "Superior Proposal" means any bona fide written offer made by
        a Third Party to acquire, directly or indirectly, for consideration
        consisting of cash and/or securities, more than 50% of the Company
        Shares then outstanding or all or substantially all the assets of the
        Company (i) on terms that the Board of Directors of the Company
        determines in its good faith judgment (after taking into account all the
        terms and conditions of the offer deemed relevant by such Board of
        Directors, including any break-up fees, expense reimbursement
        provisions, conditions to consummation, and the ability of the party
        making such proposal to obtain financing for such offer) are materially
        more favorable from a financial point of view to its stockholders than
        the Merger; and (ii) that constitutes a transaction that, in such Board
        of Directors' judgment, is reasonably likely to be consummated on the
        terms set forth, taking into account all legal, financial, regulatory
        and other aspects of such proposal.

          (g) Except as expressly permitted by Section 6.2(d), neither the Board
     of Directors of the Company nor any committee thereof shall (i) withdraw or
     modify, or propose publicly to withdraw or modify, in a manner adverse to
     Parent, the approval or recommendation by such Board of Directors of this
     Agreement or the Merger or (ii) approve or recommend, or propose publicly
     to approve or recommend, any Acquisition Proposal or Company Acquisition
     Transaction. Nothing contained in this Section 6.2 shall prohibit the
     Company from taking and

                                       33

<PAGE>

     disclosing to its stockholders a position contemplated by Rule 14e-2(a)
     promulgated under the Exchange Act. The foregoing shall in no way limit or
     otherwise effect Parent's right to terminate this Agreement pursuant to
     Section 8.4 at such time as the requirements of such Section have been met.
     The Company shall seek the written consent of the Majority Stockholders
     contemplated by Section 6.3 even if the Board of Directors of the Company
     have taken any such action pursuant to this Section 6.2(g)(i) or (ii)
     above. Nothing in this Section 6.2 shall (x) permit the Company to
     terminate this Agreement, (y) permit the Company to enter into any
     agreement with respect to any Acquisition Proposal or (z) affect any other
     obligation of the Company under this Agreement.

     6.3  Company Stockholders Meeting. Subject to Section 6.2(d), the Company
shall take all action necessary in accordance with applicable law and its
articles of incorporation and bylaws to convene, and will convene, a meeting of
its stockholders (the "Company Stockholder Meeting") as promptly as practicable
to consider and vote upon the approval of the Merger. Subject only to Section
6.2(d), the Board of Directors of the Company shall recommend and shall declare
advisable such approval (the "Company Stockholder Approval"). Unless the Board
of Directors of the Company has withdrawn its recommendation of this Agreement
in compliance herewith, the Company shall use its best efforts to solicit from
its stockholders proxies in favor of the approval and adoption of this Agreement
and the Merger and to secure the vote or consent of stockholders required by the
WBCA and its articles of incorporation and bylaws to approve and adopt this
Agreement and the Merger.

     6.4  S-3 Registration Statement and S-4 Registration Statement; Proxy
Statement. Parent will, as promptly as practicable, prepare and file with the
SEC (i) a registration statement on Form S-3 (the "S-3 Registration Statement"),
in connection with the registration under the Securities Act of the Parent
Shares issuable after conversion of the Company Shares to the holders of the
Company Shares listed on Schedule 6.4 hereto, containing a resale prospectus for
such Parent Shares, and (ii) a registration statement on Form S-4 (the "S-4
Registration Statement"), containing a proxy statement/prospectus, in connection
with the registration under the Securities Act of the Parent Shares issuable
upon conversion of the Company Shares and the other transactions contemplated
hereby. The Company and Parent will, as promptly as practicable, prepare and
file with the SEC a proxy statement that will be the same proxy
statement/prospectus contained in the S-4 Registration Statement (such proxy
statement/prospectus, together with any amendments thereof or supplements
thereto, in each case in the form or forms mailed to the Company's stockholders,
is herein called the "Proxy Statement"). The Company and Parent will, and will
cause their accountants and lawyers to, use their reasonable best efforts to
have or cause each of the Registration Statements declared effective as promptly
as practicable, including, without limitation, causing their accountants to
deliver necessary or required instruments such as opinions, consents and
certificates, and will take any other action required or necessary to be taken
under federal or state securities laws or otherwise in connection with the
registration process. The Company will use its best efforts to cause the Proxy
Statement to be mailed to its stockholders at the earliest practicable date and
will coordinate and cooperate with Parent with respect to the timing of such
mailing. Parent shall also take any action required to be taken under state
"blue sky" or other securities laws in connection with the issuance of Parent
Shares in the Merger and pursuant to the S-3 Registration Statement.

     6.5  Listing Application. Parent shall as soon as practicable prepare and
submit to the Nasdaq Stock Market National Market ("NASDAQ") a listing
application with respect to the Parent Shares issuable in the Merger, and shall
use its reasonable best efforts to obtain, prior to the Effective Time, approval
for the listing of such Parent Shares on such exchange, subject to official
notice of issuance.

     6.6  Access to Information.  Upon reasonable notice, the Company shall
afford to officers, employees, counsel, accountants and other authorized
representatives of the Parent (the "Authorized

                                       34

<PAGE>

Representatives") reasonable access, during normal business hours throughout the
period prior to the Effective Time, to its properties, assets, books and records
and, during such period, shall furnish promptly to such Authorized
Representatives all information concerning its business, properties, assets and
personnel as may reasonably be requested for purposes of appropriate and
necessary due diligence, provided that no investigation pursuant to this Section
6.6 shall affect or be deemed to modify any of the representations or warranties
made by the Company.

     6.7  Publicity. The Parties agree that they will consult with each other
concerning any proposed press release or public announcement pertaining to this
Agreement or the Merger in order to agree upon the text of any such press
release or the making of such public announcement, which agreement shall not be
unreasonably withheld, except as may be required by applicable law or by
obligations pursuant to any listing agreement with a national securities
exchange or national automated quotation system, in which case the Party
proposing to issue such press release or make such public announcement shall use
its reasonable best efforts to consult in good faith with Parent or the Company,
as applicable, before issuing any such press release or making any such public
announcement. Notwithstanding the foregoing, in the event the Board of Directors
of the Company withdraws its recommendation of this Agreement in compliance
herewith, neither Party will be required to consult with or obtain the agreement
of the other in connection with any press release or public announcement.

     6.8  Indemnification of Directors and Officers.

          (a) From and after the Effective Time, Parent shall, and in addition
     shall cause the Surviving Corporation to, indemnify, defend and hold
     harmless the present and former officers and directors of the Company (each
     an "Indemnified Party") against all losses, expenses (including reasonable
     attorneys' fees), claims, damages or liabilities and amounts paid in
     settlement in accordance with the terms of this Section 6.8 arising out of
     actions or omissions occurring on or prior to the Effective Time
     (including, without limitation, the transactions contemplated by this
     Agreement), whether asserted or claimed prior to, at or after the Effective
     Time, to the fullest extent permitted by law, including as provided for in
     their respective certificates of incorporation or bylaws (or comparable
     organizational documents) as in effect as of the Effective Time (and shall
     also advance expenses as incurred to the fullest extent permitted under
     applicable law, provided that, if required under applicable law, the Person
     to whom expenses are advanced provides an undertaking to repay such
     advances if it is ultimately determined that such Person is not entitled to
     indemnification). Without limiting the foregoing, Parent acknowledges and
     agrees that, to the extent permitted by Delaware law, it shall indemnify
     and hold harmless, from and after the Effective Time, the officers and
     directors of the Company from and against any claim that they have breached
     the fiduciary duty to the Company or its shareholders as a result of their
     approval of this Agreement and the transactions contemplated thereby. The
     articles of incorporation and bylaws of the Surviving Corporation shall
     contain, and Parent shall cause the Surviving Corporation to fulfill and
     honor, provisions with respect to indemnification and exculpation that are
     at least as favorable to the Indemnified Parties as those set forth in the
     articles of incorporation and bylaws of the Company as of the date of this
     Agreement, which provisions shall not be amended, repealed or otherwise
     modified for a period of three (3) years from the Effective Time in any
     manner that would adversely affect the rights thereunder of any of the
     Indemnified Parties.

          (b) Parent shall cause the Surviving Corporation to maintain in effect
     for not less than three (3) years the current policies of directors' and
     officers' liability insurance and fiduciary liability insurance maintained
     by the Company, Parent and their subsidiaries with respect to matters
     occurring prior to the Effective Time; provided, however, that Parent may
     substitute therefor policies covering the Indemnified Parties with coverage
     in amount and scope

                                       35

<PAGE>

     substantially similar to such existing policies; provided further, that in
     no event shall Parent be required to pay aggregate premiums for insurance
     under this Section 6.8(b) in excess of 125% of amount of aggregate premiums
     paid by the Company in 2000 on the annualized basis for such purpose.

          (c) If Parent or the Surviving Corporation or any of its successors or
     assigns (i) shall consolidate with or merge into any other corporation or
     entity and shall not be the continuing or surviving corporation or entity
     of such consolidation or merger or (ii) shall transfer all or substantially
     all of its properties and assets to any individual, corporation or other
     entity, then and in each such case, proper provisions shall be made so that
     the successors and assigns of Parent or the Surviving Corporation shall
     assume all of the obligations set forth in this Section 6.8.

     6.9  Affiliates. The Company shall deliver to Parent a letter identifying
all persons who may be deemed at the time this Agreement is submitted for
adoption by the stockholders of the Company, "affiliates" of the Company for
purposes of Rule 145 under the Securities Act ("Company Affiliates"), and such
list shall be updated as necessary to reflect changes from the date thereof.

     6.10  Maintenance of Insurance. Between the date of this Agreement and
through the Effective Time, Company shall use commercially reasonable best
efforts to maintain in full force and effect all of its presently existing
policies of insurance comparable to the coverage afforded by such policies.

     6.11  Representations and Warranties. Each of the Company and Parent shall
give prompt notice to the other of any circumstances that would cause any of
their respective representations and warranties set forth in Section 5.1 or 5.2,
as the case may be, not to be true and correct in all material respects at and
as of the Effective Time; provided, that delivery of such notice shall not cure
or be deemed to cure any breach of a representation or warranty.

     6.12  Filings; Reasonable Best Efforts to Consummate Transactions. Subject
to the terms and conditions herein provided, the Parties shall: (a) promptly
make their respective filings and thereafter make any other required submissions
under the HSR Act (if any), the Securities Act, the Exchange Act, and any other
applicable law with respect to this Agreement and the transactions contemplated
hereby; (b) cooperate in the preparation of such filings or submissions; and (c)
use their reasonable best efforts promptly to take, or cause to be taken, all
other actions and do, or cause to be done, all other things necessary, proper or
appropriate to consummate and make effective the transactions contemplated by
this Agreement as soon as practicable.

     6.13  Tax-Free Reorganization Treatment. It is intended that the Merger be
treated as a reorganization within the meaning of Section 368 of the Code. Prior
to the Effective Time, the Parties shall use their reasonable best efforts to
cause the Merger to be treated as a reorganization within the meaning of Section
368 of the Code and to obtain the opinion of their respective counsels
contemplated by Section 7.1(f) and shall not knowingly take or fail to take any
action which action or failure to act would jeopardize the qualification of the
Merger as a reorganization within Section 368 of the Code. After the Effective
Time, the Parties will take tax positions consistent with the qualification of
the Merger as a tax-free reorganization.

     6.14  Company Options. The Company shall, (i) encourage each holder of a
Company Option that is vested (or vests before the Effective Time) to exercise
that Company Option as soon as practicable before the Effective Time pursuant to
the terms and conditions of the Company Option Plan governing it or any other
agreement granting that Company Option and (ii) terminate each Company Option
(whether vested or unvested), if any, that is not exercised on or before the
Effective Time, as of the Effective Time, on terms and conditions satisfactory
to Parent. Prior to the

                                       36

<PAGE>

Effective Time, Company shall deliver to Parent, in form reasonably satisfactory
to Parent, evidence that each holder's rights pursuant to the Company Option
Plans and Company Options granted thereunder to acquire Company Shares or to
receive any other compensation shall be terminated or cancelled and will be of
no further force or effect, from and after the Effective Time.

     6.15  Accountant's Comfort Letters.

          (a) The Company shall use reasonable best efforts to cause Tanner &
     Co., the Company's independent public accountants, to deliver to Parent two
     letters, one dated approximately the date on which the Registration
     Statements shall become effective and one dated the Closing Date, in form
     reasonably satisfactory to Parent and customary in scope for comfort
     letters delivered by independent public accountants in connection with
     Registration Statements.

          (b) Parent shall use reasonable best efforts to cause
     PricewaterhouseCoopers LLC, the Parent's independent public accountants, to
     deliver to the Company two letters, one dated approximately the date on
     which the Registration Statements shall become effective and one dated the
     Closing Date, in form reasonably satisfactory to the Company and customary
     in scope for comfort letters delivered by independent public accountants in
     connection with Registration Statements.

     6.16  Debentures. The Company shall have (i) complied with all redemption
obligations of the Debentures (including, without limitation, the monthly
redemption of US$50,000 of principal and accrued interest) and (ii) used
reasonable efforts to redeem in full all amounts due and owing (including,
without limitation, the outstanding principal and interest) to the holders of
the Debentures, each as of and including the date of repayment in accordance
with the terms of the Debenture or pursuant to terms and conditions reasonably
satisfactory to Parent; provided however that the Company's obligations to make
any redemption in excess of existing obligations of the Company shall be subject
to the availability of resources therefor provided by any Person, including the
Parent, on terms reasonably satisfactory to the parties hereto or in accordance
with Section 6.22 below.

     6.17  Employee Benefits. From and after the Effective Time until the
one-year anniversary thereof, Parent shall, or shall cause the Surviving
Corporation to, offer to the employees of the Surviving Corporation employee
benefit plans, policies and programs substantially equivalent to all such plans,
policies or programs currently offered to employees of the Company as listed on
the Company Scheduled Plans.

     6.18  Company Warrants. After the Effective Time, each Substitute Warrant
shall be subject to the same terms and conditions as were applicable under the
related Company Warrant immediately prior to the Effective Time. The Company
agrees that it will not grant any warrants and will not permit cash payments to
holders of Company Warrants in lieu of the substitution therefor of Substitute
Warrants, as described herein without the prior consent of the Parent which
shall not be unreasonably withheld. As soon as practicable after the Effective
Time, Parent shall deliver to each holder of a Company Warrant an appropriate
notice setting forth such holder's rights pursuant to the Company Warrant
Agreements and such holder's rights to acquire Parent Shares and the agreement
of such holder evidencing the grants of such Company Warrants shall be deemed to
be appropriately amended so that such Company Warrants shall represent rights to
acquire Parent Shares on substantially the same terms and conditions as
contained in the outstanding Company Warrants (subject to the adjustments
required by Section 4.1 after giving effect to the Merger and the terms of the
Company Warrant Agreements).

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<PAGE>

     6.19 Voting Agreement. The Parent shall have received from Johnny R. Thomas
an executed Voting Agreement no later than February 14, 2001, in form and
substance reasonably satisfactory to Parent.

     6.20 Business of Parent Pending Closing. During the period between the date
of this Agreement and continuing until the earlier of the termination of this
Agreement or the Effective Time, Parent covenants and agrees that unless the
Company shall otherwise agree in writing, which agreement shall not unreasonably
be withheld, and except as contemplated by this Agreement:

          (i) Parent shall use its reasonable efforts to preserve substantially
     intact the assets and business of the Parent and its subsidiaries;

          (ii) Parent shall not materially amend or otherwise change its
     Certificate of Incorporation or By-Laws; and

          (iii) Parent shall not declare, set aside, make or pay any dividend or
     other distribution (whether in cash, stock or property or any combination
     thereof or any rights to acquire same) in respect of any of its capital
     stock, other than regular cash dividends consistent with past practice.

     6.21 Fairness Opinion. The Company shall retain a reputable appraiser or
investment banker (the "Company Financial Adviser") to render a written opinion
to the effect that as of the date of the Agreement and based upon and subject to
the matters stated herein, the Exchange Ratio is fair from a financial point of
view to the holders of the Company Shares. The Company shall obtain the
authorization of the Company Financial Advisor to permit the inclusion of such
opinion in the S-4 Registration Statement and Proxy Statement.

     6.22  Parent Redemption of Debentures.

          (a) At any time after the date of this Agreement prior to the
     termination of this Agreement, the Parent may, in its sole discretion,
     redeem in full all amounts due and owing to the holders of the Debentures,
     on terms and conditions satisfactory to the Parent.

          (b) In the event the Parent redeems in full all amounts due and owing
     to the holders of the Debentures, the Company hereby agrees (i) to
     immediately issue to the Parent debentures and debenture warrants in
     amounts and on terms and conditions substantially the same as those
     currently in force and effect relating to the Debentures and Debentures
     Warrants, and (ii) to use reasonable efforts to facilitate any such
     redemption.

                                   ARTICLE VII
                                   CONDITIONS

     7.1  Conditions to Each Party's Obligations.  The respective obligations of
each Party to consummate the Merger are subject to the satisfaction or waiver by
each of the Parties of the following conditions:

          (a) this Agreement and the Merger shall have been approved by the
     stockholders of the Company in accordance with the WBCA;

          (b) the Registration Statements shall have become effective in
     accordance with the provisions of the Securities Act, and no stop order
     suspending the effectiveness of the Registration Statements shall have been
     issued by the SEC and remain in effect;

          (c) no judgment, order, decree, statute, law, ordinance, rule or
     regulation, entered, enacted, promulgated, enforced or issued by any court
     or other Governmental Entity of competent jurisdiction or other legal
     restraint or prohibition shall be in effect which (i) has the effect of
     making the consummation of the Merger or the other transaction contemplated
     hereby illegal,

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<PAGE>

     (ii) materially restricts, prevents or prohibits consummation of the Merger
     or any of the transactions contemplated hereby or (iii) would impair the
     ability of Parent to own the outstanding shares of the Surviving
     Corporation, or operate its businesses (including the businesses of the
     Surviving Corporation), following the Effective Time (collectively,
     "Restraints"); and there shall not be pending any suit, action or
     proceeding by any Governmental Entity or third party which would have any
     of the foregoing effects; provided, however, that each of the parties shall
     have used their reasonable best efforts to prevent the entry of such
     Restraints and to appeal as promptly as possible any such Restraints that
     may be entered;

          (d) the waiting period(s) under the HSR Act, if applicable, shall have
     expired;

          (e) no Governmental Entity, nor any federal or state court of
     competent jurisdiction or arbitrator shall have enacted, issued,
     promulgated, enforced or entered any statute, rule, regulation, executive
     order, decree, judgment, injunctions or arbitration award or finding
     (whether temporary, preliminary or permanent), in any case which is in
     effect and which prevents or prohibits the consummation of the Merger or
     any other transactions contemplated in this Agreement;

          (f) each of Parent and the Company shall have received a written
     opinion from its respective tax counsel (PricewaterhouseCoopers LLP and
     Snow Becker Krauss P.C., respectively), in form and substance reasonably
     satisfactory to them, to the effect that the Merger will be treated for
     federal income tax purposes as a tax-free reorganization within the meaning
     of Section 368(a) of the Code and such opinions shall not have been
     withdrawn. The issuance of such opinion shall be conditioned upon the
     receipt by such tax counsel of customary representation letters from
     Parent, the Company and Merger Sub in form and substance reasonably
     satisfactory to such tax counsel;

          (g) the Parent Shares to be issued pursuant to the Merger shall have
     been duly approved for trading on the NASDAQ, subject to official notice of
     issuance;

          (h) Company and Barbara Morris shall have executed an employment
     agreement substantially in the form of Exhibit C hereto; and

          (i) Company and Carol Loomis shall have executed an employment
     agreement substantially in the form of Exhibit D hereto.

     7.2  Additional Conditions to the Obligations of the Company. The
obligations of the Company to consummate the Merger also are subject to the
fulfillment at or prior to the Effective Time of the following conditions, any
or all of which may be waived in whole or in part by the Company to the extent
permitted by applicable law:

          (a) the representations and warranties of Parent set forth in Section
     5.2 that are qualified as to materiality or Material Adverse Effect shall
     be true and correct, and such representations and warranties that are not
     so qualified shall be true and correct in all material respects, in each
     case as of the date of this Agreement, and as of the Effective Time with
     the same force and effect as if made on and as of the Effective Time
     (except to the extent expressly made as of an earlier date, in which case
     as of such date), in each case except as permitted or contemplated by this
     Agreement;

          (b) Parent and its subsidiaries shall have performed or complied in
     all material respects with its agreements and covenants required to be
     performed or complied with under this Agreement as of or prior to the
     Effective Time;

                                       39

<PAGE>

          (c) Parent shall have delivered to the Company a certificate of its
     Chief Executive Officer and Chief Financial Officer to the effect that each
     of the conditions specified in clauses (a), (b) and (d) of this Section 7.2
     is satisfied;

          (d) from the date of this Agreement to the Effective Time, there shall
     not have been any event or development which results in a Material Adverse
     Effect on Parent;

          (e) Parent shall have made available incentive compensation not less
     than (i) $110,000 and (ii) options to purchase 37,000 shares of Parent
     Shares, each in the aggregate, to be offered to specific key employees of
     the Company determined by the Parent, after consultation with the Company's
     president at such time of issuance or grant, and which shall be issued or
     granted, as the case may be, based on performance, on terms and conditions
     reasonably satisfactory to Parent.

     7.3  Additional Conditions to the Obligations of Parent. The obligations of
Parent to consummate the Merger also are subject to the fulfillment at or prior
to the Effective Time of the following conditions, any or all of which may be
waived in whole or in part by Parent to the extent permitted by applicable law:

          (a) the representations and warranties of the Company set forth in
     Section 5.1 that are qualified as to materiality or Material Adverse Effect
     shall be true and correct, and such representations and warranties that are
     not so qualified shall be true and correct in all material respects, in
     each case as of the date of this Agreement, and as of the Effective Time
     with the same force and effect as if made on and as of the Effective Time
     (except to the extent expressly made as of an earlier date, in which case
     as of such date), in each case except as permitted or contemplated by this
     Agreement;

          (b) the Company shall have performed or complied in all material
     respects with its agreements and covenants required to be performed or
     complied with under this Agreement as of or prior to the Effective Time;

          (c) the Company shall have delivered to Parent a certificate of its
     Chief Executive Officer and Chief Financial Officer to the effect that each
     of the conditions specified in clauses (a), (b) and (d) of this Section 7.3
     is satisfied;

          (d) from the date of this Agreement to the Effective Time, there shall
     not have been any event or development which results in a Material Adverse
     Effect on the Company;

          (e) Barbara Morris shall have entered into the Morris Employment
     Agreement;

          (f) Carol Loomis shall have entered into the Loomis Employment
     Agreement;

          (g) Barbara Morris shall have entered into a Lock-Up Agreement
     substantially in the form of Exhibit E hereto (a "Lock-Up Agreement");

          (h) Carol Loomis shall have entered into a Lock-Up Agreement; and

          (i) holders of Company Shares owing an aggregate percentage interest
     of no more than five percent (5%) of the outstanding Company Shares on the
     date of this Agreement shall have given written notice to the Company of
     such stockholder's wish to assert their respective right to elect to
     exercise its appraisal rights with respect to the Merger, as provided in
     the WBCA.

                                       40

<PAGE>

                                  ARTICLE VIII

                                   TERMINATION

     8.1  Termination by Mutual Consent.  This Agreement may be terminated and
the Merger may be abandoned at any time prior to the Effective Time, by the
mutual written consent of the Company and Parent.

     8.2 Termination by either the Company or Parent. This Agreement may be
terminated and the Merger may be abandoned at any time prior to the Effective
Time, by action of the Board of Directors of either the Company or Parent if:

          (a) the Merger shall not have been consummated by August 31, 2001;
     provided, however, that the right to terminate this Agreement under this
     Section 8.2(a) shall not be available to any Party whose failure to fulfill
     any obligation under this Agreement or the Voting Agreement has been the
     cause of or resulted in the failure of the Merger to occur on or before
     such date; or

          (b) if any Restraint shall be in effect and shall have become final
     and nonappealable; provided, however, that the right to terminate this
     Agreement -- under this Section 8.2(b) shall not be available to any Party
     who fails to use reasonable best efforts to remove such Restraint before it
     becomes final and nonappealable.

     8.3  Termination by the Company. This Agreement may be terminated upon
written notice to Parent, and the Merger may be abandoned, at any time prior to
the Effective Time, by action of the Board of Directors of the Company, if (A)
Parent shall have breached or failed to perform any of the representations,
warranties, covenants or other agreements contained in this Agreement, or if any
representation or warranty of Parent shall have become untrue, in either case
such that (i) the condition set forth in Section 7.2(a) or (b) would not be
satisfied as of the time of such breach or as of such time as such
representation or warranty shall have become untrue and (ii) such breach or
failure to be true has not been or is incapable of being cured within twenty
(20) business days following receipt by Parent of notice of such breach or
failure to comply or (B) all of the Debentures shall not have been redeemed
within 90 days after the date of this Agreement unless such failure to redeem is
the result of the failure of the Company to make such redemption either (i) at a
time when it has or has been provided by any Person, including the Parent, the
resources therefor or (ii) in violation of Section 6.16.

     8.4  Termination by Parent. This Agreement may be terminated upon written
notice to the Company, and the Merger may be abandoned, at any time prior to the
Effective Time, by action of the Board of Directors of Parent, if:

          (a) the Company shall have breached or failed to perform any of the
     representations, warranties, covenants or other agreements contained in
     this Agreement, or if any representation or warranty of the Company shall
     have become untrue, in either case such that (i) the condition set forth in
     Section 7.3(a) or (b) would not be satisfied as of the time of such breach
     or as of such time as such representation or warranty shall have become
     untrue and (ii) such breach or failure to be true has not been or is
     incapable of being cured within twenty (20) business days following receipt
     by the breaching Party of notice of such breach or failure to comply; or

          (b) (i) the Board of Directors of the Company or any committee thereof
     shall have withdrawn or modified in a manner adverse to Parent its approval
     or recommendation of the Merger or this Agreement, (ii) the Company shall
     have failed to include in the Proxy Statement the recommendation of the
     Board of Directors of the Company in favor of approval to the Merger and
     this Agreement, (iii) the Board of Directors of the Company or any
     committee thereof shall have recommended any Acquisition Proposal, (iv) the
     Company or any of its officers or directors shall have entered into
     discussions or negotiations in violation of Section 6.2,

                                       41

<PAGE>

     (v) the Company shall enter into an agreement to consummate a Company
     Acquisition Transaction, (vi) the Board of Directors of the Company or any
     committee thereof shall have resolved to do any of the foregoing or (vii)
     any Company Acquisition Transaction is consummated.

     8.5  Effect of Termination; Termination Fee.

          (a) Except as set forth in this Section 8.5, in the event of
     termination of this Agreement by either Parent or the Company as provided
     in this Article VIII, this Agreement shall forthwith become void and there
     shall be no liability or obligation on the part of the Parties or their
     respective affiliates, officers, directors or stockholders except (x) with
     respect to the payment of expenses pursuant to Section 9.1, (y) to the
     extent that such termination results from the willful breach of a Party of
     any of its representations or warranties, or any of its covenants or
     agreements or (z) with respect to intentional or knowing misrepresentation
     in connection with this Agreement or the transactions contemplated hereby.

          (b) Company Termination Fee.

             (i) If this Agreement is terminated by the Company for any reason
        other than as set forth in Sections 8.2 or 8.3 or any actions related
        thereto, or if this Agreement is terminated by Parent pursuant to
        Section 8.4, then the Company shall pay Parent a fee equal to the
        greater of (A) in the event that any Company Acquisition Transaction is
        consummated, 50% of the difference between (1) the fair market value of
        all consideration, including cash and/or securities, received from a
        Third Party for the Company Shares in any Company Acquisition
        Transaction and (2) $12,000,000, or (B) $2,000,000 (the "Company
        Termination Fee").

             (ii) The Company Termination Fee shall be payable by wire transfer
        of immediately available funds upon such termination of this Agreement.

          (c) Parent Termination Fee. If this Agreement is terminated by Parent
     for any reason other than as set forth in Sections 8.2 or 8.4, or if this
     Agreement is terminated by the Company by reason of Section 8.3, then
     Parent shall pay Company a fee equal to $2,000,000 (the "Parent Termination
     Fee").

          (d) Each Party acknowledges that the agreements contained in Sections
     8.5(b) and (c) are an integral part of the transactions contemplated by
     this Agreement, and that without these agreements, the other Party would
     not enter into this Agreement, and accordingly, if either (i) the Company
     fails to pay the Company Termination Fee when due pursuant to Section
     8.5(b), or (ii) the Parent fails to pay the Parent Termination Fee when due
     pursuant to Section 8.5(c), then such amount shall be payable with interest
     at the prime rate announced by Citibank, N.A. in effect from the date such
     payment was required to be made to the date of payment. If the
     non-terminating Party commences suit which results in a judgment against
     the terminating Party for payment pursuant to Sections 8.5(b) or (c), then
     the terminating Party shall pay the non-terminating Party its costs and
     expenses (including reasonable attorneys' fees and expenses) in connection
     with such suit.

          (e) Sole Remedy. If this Agreement is terminated under circumstances
     in which either the Company is entitled to receive the Parent Termination
     Fee, or the Parent is entitled to receive the Company Termination Fee, then
     the payment of such Company Termination Fee, or Parent Termination Fee, as
     applicable, shall be the sole and exclusive remedy available, except in the
     event of (x) a willful breach by one Party of any provision of this
     Agreement, or (y) the intentional or knowing misrepresentation by one Party
     in connection with this Agreement or the transactions contemplated hereby,
     in which event the other Party shall have all rights, powers

                                       42

<PAGE>

     and remedies against such Party which may be available at law or in equity.
     All rights, powers and remedies provided under this Agreement or otherwise
     available in respect hereof at law or in equity shall be cumulative and not
     alternative, and the exercise of any such right, power or remedy by any
     Party shall not preclude the simultaneous or later exercise of any other
     such right, power or remedy by such Party.

                                   ARTICLE IX

                            MISCELLANEOUS AND GENERAL

     9.1  Payment of Expenses. Whether or not the Merger shall be consummated,
each Party shall pay its own expenses incident to preparing for, entering into
and carrying out this Agreement and the consummation of the transactions
contemplated hereby, provided that the Surviving Corporation shall pay any and
all property or transfer taxes imposed on the Surviving Corporation. The filing
fee and the cost of printing the S-4 Registration Statement and the Proxy
Statement and the filing fee for the required filing under the HSR Act, if any,
shall be borne equally by the Company and Parent. The filing fee and the cost of
printing the S-3 Registration Statement shall be borne solely by the Parent.

     9.2  Non-Survival of Representations and Warranties. The representations
and warranties made herein shall not survive beyond the Effective Time or a
termination of this Agreement, except to the extent a willful breach of such
representation or intentional or knowing misrepresentation formed the basis for
such termination. This Section 9.2 shall not limit any covenant or agreement of
the Parties which by its terms contemplates performance after the Effective
Time.

     9.3  Modification or Amendment. Subject to the applicable provisions of the
DGCL and WBCA, at any time prior to the Effective Time, the parties hereto, by
resolution of their respective Board of Directors, may modify or amend this
Agreement, by written agreement executed and delivered by duly authorized
officers of the respective Parties; provided, however, that after the approval
of the Merger by the requisite approval of the Company's stockholders, no
amendment which requires further stockholder approval shall be made without such
approval of such stockholders.

     9.4  Waiver of Conditions. The conditions to each of the Parties'
obligations to consummate the Merger are for the sole benefit of such Party and
may be waived by such Party in whole or in part to the extent permitted by
applicable law.

     9.5  Counterparts. For the convenience of the parties hereto, this
Agreement may be executed in any number of counterparts, each such counterpart
being deemed to be an original instrument, and all such counterparts shall
together constitute the same agreement.

     9.6  Governing Law.  This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without giving effect to the
principles of conflicts of law thereof.

     9.7  Notices. Any notice, request, instruction or other document to be
given hereunder by any Party to the other Parties shall be deemed delivered upon
actual receipt and shall be in writing and delivered personally or sent by
registered or certified mail, postage prepaid, reputable overnight courier, or
by facsimile transmission (with a confirming copy sent by reputable overnight
courier), as follows:

          (a) if to Parent or Merger Sub, to:

           PLATO Learning, Inc.
           10801 Nesbitt Avenue South
           Bloomington, Minnesota 55437
           Attention: John Buske
           Facsimile: (952)832-1210

                                       43

<PAGE>

        with a copy to:

           Winston & Strawn
           35 West Wacker Drive
           Chicago, Illinois 60601
           Attention: Leland E. Hutchinson
           Facsimile: (312)558-5700

          (b) if to the Company, to:

           Wasatch Interactive Learning Corporation
           5250 South Commerce Drive
           Suite 101
           Salt Lake City, Utah 84107
           Attention: Barbara Morris
           Facsimile: (801)269-1509

          with a copy to:

           Snow Becker Krauss P.C.
           605 Third Avenue
           25th Floor
           New York, New York 10158
           Attention: Elliot Lutzker
           Facsimile: (212)949-7052

or to such other Persons or addresses as may be designated in writing by the
Party to receive such notice.

     9.8 Entire Agreement; Assignment. This Agreement, including the Disclosure
Schedules and the Exhibits attached hereto, (i) constitutes the entire agreement
among the Parties with respect to the subject matter hereof and supersedes all
other prior agreements and understandings, both written and oral, among the
Parties or any of them with respect to the subject matter hereof, and (ii) shall
not be assigned by operation of law or otherwise.

     9.9 Parties in Interest. This Agreement shall be binding upon and inure
solely to the benefit of each Party hereto and their respective successors and
assigns. Nothing in this Agreement, express or implied, other than the right to
receive the consideration payable in the Merger pursuant to Article IV hereof,
is intended to or shall confer upon any other Person any rights, benefits or
remedies of any nature whatsoever under or by reason of this Agreement;
provided, however, that the provisions of Section 6.8 shall inure to the benefit
of and be enforceable by the Indemnified Parties.

     9.10 Certain Definitions. As used herein the following terms shall have the
following meanings and, unless the context otherwise requires, use of the
singular form shall include the plural and any gender shall be deemed to include
both genders:

          (a) "Debentures" means those certain 7% convertible debentures due
     March, 2003 of the Company in the aggregate principal amount of $4,000,000.

          (b) "Debenture Warrants" means those certain warrants issued March 16,
     2000 to purchase 196,078 shares of Company Shares issued in connection with
     the Debentures.

          (c) "ERISA" means the Employment Retirement Income Security Act of
     1974, as amended.

                                       44

<PAGE>

          (d) "Governmental Entity" means the United States or any
     supranational, national, state, municipal, local or foreign government, or
     any instrumentality, division, subdivision, court, agency, department or
     authority of any thereof or any quasi-governmental or private body
     exercising any regulatory, taxing, importing or other governmental or
     quasi-governmental authority.

          (e) "Knowledge" with respect to a Party hereto shall mean the actual
     knowledge of any of the executive officers of such Party.

          (f) "Material Adverse Effect" shall mean, with respect to any Person,
     any change, circumstance, event or effect that individually or in the
     aggregate with all other changes, circumstances, events or effects (i) is
     or is reasonably likely to be materially adverse to the business,
     operations, financial condition, results of operations or prospects of such
     Person and its subsidiaries taken as a whole or (ii) will, or would be
     reasonably likely to, prevent or materially impair such Person's ability to
     consummate the Merger or the other transactions contemplated by this
     Agreement.

          (g) "Parent Share Market Value" means the volume-weighted average of
     the closing prices of the Parent Shares on the NASDAQ National Market
     System on each of the 5 trading days ending on (and including) the date
     immediately prior to the Closing Date.

          (h) "Person" means any individual, sole proprietorship, partnership,
     joint venture, trust, unincorporated association, corporation, subsidiary,
     entity or Governmental Entity.

          (i) "Plan Affiliate" means any corporation, trade or business that is
     a member of a controlled group of corporations, a group of trades or
     businesses under common control, or an affiliated service group, as
     described in Sections 414(b), (c), (m) and (o) of the Code, which the
     Company is also a member.

          (j) "Significant Tax Agreement" is any agreement to which any Party or
     any subsidiary of any Party is a party under which such Party or such
     subsidiary could reasonably be expected to be liable to another party under
     such agreement in an amount in excess of $25,000 in respect of Taxes
     payable by such other party to any taxing authority.

          (k) "Software" means all computer software and subsequent versions
     thereof, including but not limited to, source code, firmware, development
     tools, object code, objects, comments, screens, user interfaces, report
     formats, templates, menus, buttons and icons, and all files, recording
     data, materials manuals, design notes and other items and documentation
     related thereto or associated therewith and all media which any of the
     foregoing is recorded.

          (l) "subsidiary" shall mean, when used with reference to any entity,
     any entity fifty percent (50%) or more of the outstanding voting securities
     or interests of which are owned directly or indirectly by such former
     entity.

          (m) "Tax" or "Taxes" refers to any and all federal, state, local and
     foreign, taxes, assessments and other governmental charges, duties,
     impositions and liabilities relating to taxes, including taxes based upon
     or measured by gross receipts, net or gross income, capital gains, profits,
     license, capital, sales, use and occupation, and value added, ad valorem,
     transfer, franchise, withholding, payroll, recapture, employment, goods and
     services, excise, severance, stamp, premium, windfall profits, customs,
     duties, property or other taxes, together with all interest, penalties and
     additions imposed with respect to such amounts and including any liability
     for taxes of a predecessor entity.

                                       45

<PAGE>

     9.11  Obligations of Subsidiary. Whenever this Agreement requires any
subsidiary of a Party to take any action, such requirement shall be deemed to
include an undertaking on the part of such Party to cause such subsidiary to
take such action.

     9.12  Severability. If any term or other provision of this Agreement is
invalid, illegal or unenforceable, all other provisions of this Agreement shall
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any Party. Upon a determination that any term or other provision is
invalid, illegal or incapable of being enforced, the Parties shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
Parties as closely as possible in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the maximum extent possible.

     9.13  Specific Performance. The parties hereto acknowledge that irreparable
damage would result if this Agreement were not specifically enforced, and they
therefore consent that the rights and obligations of the parties under this
Agreement may be enforced by a decree of specific performance issued by a court
of competent jurisdiction. Such remedy shall, however, not be exclusive and
shall be in addition to any other remedies which any Party may have under this
Agreement or otherwise.

     9.14  Trial by Jury. Each of the Parties hereto hereby irrevocably and
unconditionally waives any right it may have to trial by jury in connection with
any litigation arising out of or relating to this Agreement, the Voting
Agreement or Merger or any of the other transactions contemplated hereby or
thereby.

     9.15  Captions. The Article, Section and paragraph captions herein are for
convenience of reference only, do not constitute part of this Agreement and
shall not be deemed to limit or otherwise affect any of the provisions hereof.

                                       46

<PAGE>

     IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by
the duly authorized officers of the Parties hereto and shall be effective as of
the date first herein above written.

                                            PLATO LEARNING, INC.

                                            By:       /s/ JOHN MURRAY
                                              ----------------------------------
                                                Name: John Murray
                                                Title: President and Chief
                                                Executive Officer

                                            WILC ACQUISITION CORPORATION

                                            By:       /s/ JOHN MURRAY
                                              ----------------------------------
                                                Name: John Murray
                                                Title: President and Chief
                                                Executive Officer

                                            WASATCH INTERACTIVE LEARNING
                                            CORPORATION

                                            By:     /s/ BARBARA MORRIS
                                              ----------------------------------
                                                Name: Barbara Morris
                                                Title: President

                                       47

<PAGE>

 EXHIBIT E

                              PLATO LEARNING, INC.

                                LOCK-UP AGREEMENT

                                ________ __, 2001

PLATO Learning, Inc.
10801 Nesbitt Avenue South
Bloomington, Minnesota 55437

Ladies and Gentlemen:

     The undersigned is a beneficial owner of securities of PLATO Learning,
Inc., a Delaware corporation (the "Company"). The undersigned understands that
the Company is engaged in the preparation of a registration statement on Form
S-3, Registration No. 333-_______ (the "Registration Statement"), in connection
with the proposed registration and distribution (the "Distribution") of ___
shares of the Company's Class A Common Stock, $0.01 par value per share (the
"S-3 Common Stock").

     The undersigned recognizes that it is in the best financial interests of
the undersigned, as a beneficial owner of securities of the Company, to enter
into this agreement to facilitate the Distribution and to provide for an orderly
trading market for the S-3 Common Stock during the period following the
commencement of the Distribution.

     In consideration of the foregoing and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
undersigned hereby agrees and represents to you that the undersigned will not,
without prior written consent of the Company, offer to sell contract to sell, or
otherwise sell, dispose of, loan, pledge or grant any rights with respect to
twenty-five percent (25%) of the aggregate number of shares of S-3 Common Stock
(collectively, the "Securities") at the date of effectiveness of the
Registration Statement owned directly by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition for a
period commencing on the date of the effectiveness of the Registration Statement
and continuing to and including the date one-year after the date of the
effectiveness of the Registration Statement (the "Lock-up Period").

     The foregoing restriction is expressly agreed to preclude the undersigned
from engaging in any hedging or other transaction which is designed to or
reasonably expected to lead to or result in a disposition of Securities during
the Lock-up Period, even if such Securities would be disposed of by someone
other than the undersigned. Such prohibited hedging or other transactions
include, without limitation, any short sale (including short sales "against the
box") or any purchase, sale or grant of any right (including, without

<PAGE>

limitation, any put or call option) with respect to any Securities or with
respect to any security (other than a broad-based market basket or index) that
includes, relates to or derives any significant part of its value from the
Securities.

     The undersigned also agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent against the transfer of the
Securities issued or issuable to the undersigned.

     The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Lock-up Agreement. All authority
herein conferred or agreed to be conferred shall survive the death or incapacity
of the undersigned and any obligations of the undersigned shall be binding upon
the heirs, personal representatives, successors and permitted assigns of the
undersigned.

     Executed as of the date first above written.

                                             Very truly yours,

                                    -------------------------------------------
                                        (print exact name of stockholder)

                                    By:
                                       ----------------------------------------
                                               (signature)

                                    -------------------------------------------
                                               (print name and title)Exhibit 10.2

                               AMENDMENT NO. 1 TO
                          AGREEMENT AND PLAN OF MERGER

     AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER (this "Amendment"), dated
as of February 20, 2001, by and among PLATO LEARNING, INC., a Delaware
corporation ("Parent"), WILC ACQUISITION CORPORATION, a Delaware corporation and
a wholly-owned subsidiary of Parent ("Merger Sub"), and WASATCH INTERACTIVE
LEARNING CORPORATION, a Washington corporation (the "Company"). Parent, Merger
Sub and the Company are referred to collectively herein as the "Parties".

                                    RECITALS

     WHEREAS, Parent, Merger Sub and the Company are parties to that certain
Agreement and Plan of Merger, dated as of January 31, 2001 (the "Agreement"),
pursuant to which the parties thereto have agreed, among other things, to merge
Merger Sub with and into the Company;

     WHEREAS, Parent, Merger Sub and the Company have mutually agreed to
restructure the merger as contemplated by the Agreement and merge the Company
with and into the Merger Sub, and wish to amend the Agreement to reflect such
restructuring;

     WHEREAS, Parent, Merger Sub and the Company also desire to amend certain
other provisions of the Agreement; and

     NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants and agreements set forth herein, the Parties hereby agree as follows:

     1. Amendments.

     (a) Section 1.1 is hereby deleted in its entirety and replaced with the
following:

          "1.1 The Merger. Upon the terms and subject to the conditions set
     forth in this Agreement, and in accordance with the Delaware General
     Corporation Law, as amended (the "DGCL"), and the Washington Business
     Corporation Act, as amended (the "WBCA"), at the Effective Time, the
     Company shall be merged with and into the Merger Sub, the separate
     corporate existence of the Company shall thereupon cease and the Merger Sub
     shall continue as the surviving corporation and shall succeed to and assume
     all the rights and obligations of the Company in accordance with the DGCL
     and the WBCA. The Merger Sub, as the surviving corporation after the
     consummation of the Merger, is sometimes hereinafter referred to as the
     "Surviving Corporation." The name of the Surviving Corporation shall be
     changed at the Effective Time (as hereafter defined) or as soon as
     practicable following the Effective Time to "Wasatch Interactive Learning
     Corporation".";

     (b) Section 6.1(b)(ii) of the Agreement is hereby deleted in its entirety
and replaced with the following:

          "(ii) except for shares to be issued upon (A) exercise of outstanding
     options as contemplated pursuant to Section 6.14, (B) exercise of
     outstanding warrants, or (C) issuance or delivery of the number of Company
     Shares to National Financial Communications Corp, doing business as OTC
     Financial Network, a Massachusetts corporation ("NFCC"), in connection with
     the Company's termination of that certain Consulting Agreement by and
     between the Company and NFCC, dated as of November 6, 2000 (the "NFCC
     Agreement"), or any acceleration thereof, determined in accordance with the
     terms and conditions thereof, issue, deliver, sell, dispose of, pledge or
     otherwise encumber, or authorize or propose the issuance, sale, disposition
     or pledge or other encumbrance of (1) any additional shares of capital
     stock of any class, or any securities or rights convertible into,
     exchangeable for, or evidencing the right to subscribe for any

<PAGE>

     shares of capital stock, or any rights, warrants, options, calls,
     commitments or any other agreements of any character to purchase or acquire
     any shares of capital stock or any securities or rights convertible into,
     exchangeable for, or evidencing the right to subscribe for, any shares of
     capital stock, or (2) any other securities in respect of, in lieu of, or in
     substitution for, shares outstanding on the date of this Agreement;";

     (c) Section 6.1(b)(viii) of the Agreement is hereby deleted in its entirety
and replaced with the following:

          "(viii) except for (A) the incurrence of indebtedness as a result of
     the issuance, transfer or reissuance of the Debentures and Debenture
     Warrants to the Parent or Merger Sub, or any transfer thereof, in
     accordance with Sections 6.16 and 6.22, or (B) other than in the ordinary
     course of business consistent with past practice, incur any indebtedness
     for borrowed money or guarantee any such indebtedness or make any loans,
     advances or capital contributions to, or investments in, any other
     Person;";

     (d) Section 6.1(b)(xii) of the Agreement is hereby deleted in its entirety
and replaced with the following:

          "(xii) enter into, amend, modify, terminate (partially or completely),
     grant any waiver under or give any consent with respect to any contract or
     license not consistent with past practices of the Company except pursuant
     to this Section 6.1(b);";

     (e) Section 6.16 of the Agreement is hereby deleted in its entirety and
replaced with the following:

          "6.16 Debentures. The Company shall (i) comply with all redemption
     obligations of the Debentures (including, without limitation, the monthly
     redemption of US$50,000 of principal and accrued interest) and (ii) (A) use
     reasonable efforts to redeem in full all amounts due and owing (including,
     without limitation, the outstanding principal and interest) to the holders
     of the Debentures, each as of and including the date of repayment in
     accordance with the terms of the Debenture or pursuant to terms and
     conditions reasonably satisfactory to Parent or Merger Sub; provided,
     however, that the Company's obligations to make any redemption in excess of
     existing obligations of the Company shall be subject to the availability of
     resources therefor provided by any Person, including the Parent or Merger
     Sub, on terms reasonably satisfactory to the parties hereto and on terms no
     less favorable to the Company than those currently in force with respect to
     the Debentures and Debenture Warrants, or (B) permit a sale or transfer of
     the Debentures and Debenture Warrants to Parent or Merger Sub pursuant to
     terms and conditions between Parent or Merger Sub and the current holder of
     the Debentures and Debenture Warrants reasonably satisfactory to Parent or
     Merger Sub.";

     (f) Section 6.22 of the Agreement is hereby deleted in its entirety and
replaced with the following:

          "6.22 Purchase or Assumption of Debentures and Debenture Warrants by
     Parent or Merger Sub.

          (a) At any time after the date of this Agreement prior to the
     termination of this Agreement, the Parent or Merger Sub may, in the
     Parent's sole discretion, purchase, assume or accept by sale or transfer
     the Debentures and Debenture Warrants and all amounts due and owing
     thereunder, on terms and conditions between Parent or Merger Sub and the
     current holder of the Debentures and Debenture Warrants satisfactory to the
     Parent or Merger Sub, as the case may be.

          (b) In the event the Parent or Merger Sub purchases, assumes or
     accepts by transfer or sale the Debenture and Debenture Warrants and all
     amounts due and owing thereunder, the

<PAGE>

     Company hereby agrees to (i) immediately permit or consent to the sale or
     transfer, as the case may be, to the Parent or Merger Sub, as the case may
     be, the Debentures and Debenture Warrants, and (ii) use reasonable efforts
     to facilitate any such purchase, assumption or acceptance by sale or
     transfer.";

     (g) The Agreement is hereby amended to include new Section 6.23 in its
entirety:

          "6.23 NFCC Agreement. Prior to the ten (10) day period preceding the
     Effective Time, the Company shall terminate the NFCC Agreement and issue
     and deliver to NFCC any and all Company Shares due and owing to NFCC
     relating to the NFCC Agreement or any transactions contemplated thereby, in
     full and complete satisfaction of the Company's obligations relating to the
     NFCC Agreement or any transaction contemplated thereby, each in accordance
     with the terms and conditions therein.";

     (h) Section 8.3 of the Agreement is hereby deleted in its entirety and
replaced with the following:

          "8.3 Termination by the Company. This Agreement may be terminated upon
     written notice to Parent, and the Merger may be abandoned, at any time
     prior to the Effective Time, by action of the Board of Directors of the
     Company, if (A) Parent shall have breached or failed to perform any of the
     representations, warranties, covenants or other agreements contained in
     this Agreement, or if any representation or warranty of Parent shall have
     become untrue, in either case such that (i) the condition set forth in
     Section 7.2(a) or (b) would not be satisfied as of the time of such breach
     or as of such time as such representation or warranty shall have become
     untrue and (ii) such breach or failure to be true has not been or is
     incapable of being cured within twenty (20) business days following receipt
     by Parent of notice of such breach or failure to comply or (B) all of the
     Debentures shall not have been redeemed by the Company or purchased,
     accepted by or transferred to Parent or Merger Sub, in any such case,
     within 90 days after the date of this Agreement unless such failure to
     redeem, purchase or transfer is the result of the failure of the Company to
     make such redemption, or consent to such sale or transfer either (i) at a
     time when the resources for such redemption or purchase have been provided
     by or available on terms reasonably satisfactory to the parties hereto and
     on terms no less favorable to the Company than those currently in force
     with respect to the Debentures and Debenture Warrants from any Person,
     including the Parent or the Merger Sub, (ii) any Person has arranged or
     facilitated the purchase or transfer pursuant to Section 6.22, or (iii) in
     violation of either Section 6.16 or 6.22.";

     (i) The Agreement is hereby amended to include new Company Disclosure
Schedule for Section 5.1(f), 5.1(h) and Section 5.1(m)(ii) attached hereto.

     (j) The Agreement is hereby amended to include new Schedule 6.4 attached
hereto.

     2. Effectiveness of Amendment. This Amendment shall be deemed to be an
amendment to the Agreement in accordance with Section 9.03 of the Agreement.
Except as specifically amended above, the Agreement shall continue in full force
and effect and is hereby ratified and confirmed in all respects. Nothing
contained herein shall be deemed to modify any provision of the Agreement except
as otherwise expressly provided herein. Each reference in this Amendment to
"this Agreement", "hereunder","hereof", "herein" and words of similar import
shall mean and be a reference to the Agreement, as amended hereby.

     3. Counterparts. For the convenience of the parties hereto, this Amendment
may be executed in any number of counterparts, each such counterpart being
deemed to be an original instrument, and all such counterparts shall together
constitute the same agreement.

<PAGE>

     4. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of Delaware, without giving effect to the
principles of conflicts of law thereof.

     5. Parties in Interest. This Amendment shall be binding upon and inure
solely to the benefit of each Party hereto and their respective successors and
assigns

     6. Captions. The Article, Section and paragraph captions herein are for
convenience of reference only, do not constitute part of this Amendment and
shall not be deemed to limit or otherwise affect any of the provisions hereof.

                            [Signature Page Follows]
<PAGE>

     IN WITNESS WHEREOF, this Amendment has been duly executed and delivered by
the duly authorized officers of the Parties hereto and shall be effective as of
the date first herein above written.

                                  PLATO LEARNING, INC.

                                  By:
                                                   /s/ JOHN M. BUSKE
                                       ----------------------------------------
                                       Name:  John M. Buske
                                       Title: Vice President Finance and Chief
                                              Financial Officer

                                  WILC ACQUISITION CORPORATION

                                  By:
                                                   /s/ JOHN M. BUSKE
                                       ----------------------------------------
                                       Name:  John M. Buske
                                       Title: Vice President Finance and Chief
                                              Financial Officer

                                  WASATCH INTERACTIVE LEARNING CORPORATION
                                  By:

                                              /s/ TODD F. BRASHEAR
                                  ---------------------------------------------
                                       Name:  Todd F. Brashear
                                       Title: Chief Financial Officer

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