AGREEMENT AND PLAN OF MERGER Among

EXHIBIT 2.1

EXECUTION COPY

AGREEMENT AND PLAN OF MERGER

Among

PEARSON EDUCATION, INC.,

EPSILON ACQUISITION CORP.

and

ECOLLEGE.COM

Dated as of May 14, 2007

TABLE OF CONTENTS

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Exhibits:

Exhibit A                Certificate of Incorporation of the Surviving Corporation

Exhibit B                Bylaws of Merger Sub

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INDEX OF DEFINED TERMS

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AGREEMENT AND PLAN OF MERGER

AGREEMENT AND PLAN OF MERGER, dated as of May 14, 2007 (this “ Agreement ”), among Pearson Education, Inc., a Delaware corporation (“ Parent ”), Epsilon Acquisition Corp, a Delaware corporation and a wholly-owned subsidiary of Parent (“ Merger Sub ”), and eCollege.com, a Delaware corporation (the “ Company ”).

WHEREAS, the Board of Directors of the Company (the “ Board ”) has unanimously (i) determined that it is fair to, and in the best interests of, the Company and the stockholders of the Company, and declared it advisable, to enter into this Agreement with Parent and Merger Sub providing for the merger (the “ Merger ”) of Merger Sub with and into the Company in accordance with the General Corporation Law of the State of Delaware (the “ DGCL ”), upon the terms and subject to the conditions set forth herein, (ii) approved this Agreement in accordance with the DGCL, upon the terms and subject to the conditions set forth herein, and (iii) resolved to recommend adoption of this Agreement by the stockholders of the Company; and

WHEREAS, the Boards of Directors of Parent and Merger Sub have each approved, and the Board of Directors of Merger Sub has declared it advisable for Merger Sub to enter into, this Agreement providing for the Merger in accordance with the DGCL, upon the terms and subject to the conditions set forth herein; and

WHEREAS, concurrently with the execution of this Agreement, and as a condition and inducement to Parent’s willingness to enter into this Agreement, certain stockholders of the Company are entering into a voting agreement with Parent (the “ Voting Agreement ”) pursuant to which such stockholders have irrevocably agreed, among other things, to vote or cause to be voted in favor of the approval of this Agreement all Shares (as defined below) beneficially owned by such stockholders in accordance with and subject to the terms set forth in the Voting Agreement.

NOW, THEREFORE, in consideration of the foregoing and the mutual representations, warranties, covenants and agreements herein contained, and intending to be legally bound hereby, Parent, Merger Sub and the Company hereby agree as follows:

ARTICLE I.

THE MERGER

SECTION 1.1.   The Merger .  Upon the terms and subject to the conditions of this Agreement and in accordance with the DGCL, at the Effective Time (as defined below), Merger Sub shall be merged with and into the Company.  As a result of the Merger, the separate corporate existence of Merger Sub shall cease and the Company shall continue as the surviving corporation of the Merger (the “ Surviving Corporation ”).

SECTION 1.2.   Closing; Effective Time .  Subject to the provisions of Article VII, the closing of the Merger (the “ Closing ”) shall take place at the offices of Kirkland & Ellis LLP, located at 200 East Randolph Drive, Chicago, Illinois, as soon as practicable, but in no event

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later than the third business day after the satisfaction or waiver of the conditions set forth in Article VII (other than those conditions that by their nature are to be satisfied by actions taken at the Closing, but subject to the satisfaction or (to the extent permitted by law) waiver of those conditions), or at such other place or on such other date as Parent and the Company may mutually agree.  The date on which the Closing actually occurs is hereinafter referred to as the “ Closing Date ”.  At the Closing, the parties hereto shall cause the Merger to be consummated by filing a certificate of merger (the “ Certificate of Merger ”) with the Secretary of State of the State of Delaware, in such form as required by, and executed in accordance with, the relevant provisions of the DGCL (the date and time of the filing of the Certificate of Merger with the Secretary of State of the State of Delaware, or such later time as is specified in the Certificate of Merger and as is agreed to by the Company and Parent, being hereinafter referred to as the “ Effective Time ”) and shall make all other filings or recordings required under the DGCL in connection with the Merger.

SECTION 1.3.   Effects of the Merger .  From and after the Effective Time, the Merger shall have the effects set forth herein and in the applicable provisions of the DGCL.  Without limiting the generality of the foregoing and subject thereto, at the Effective Time, all the property, rights, privileges, immunities, 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.

SECTION 1.4.  Certificate of Incorporation; By-Laws .

(a)           At the Effective Time, and without any further action on the part of the Company or Merger Sub, the certificate of incorporation of the Company, as in effect immediately prior to the Effective Time, shall be amended by virtue of the Merger so as to read in its entirety as is set forth on Exhibit A annexed hereto, and, as so amended, shall be the certificate of incorporation of the Surviving Corporation until thereafter amended in accordance with its terms and as provided by law.

(b)           At the Effective Time, and without any further action on the part of the Company or Merger Sub, the by-laws of the Company shall be amended by virtue of the Merger so as to read in their entirety in the form as is set forth in Exhibit B annexed hereto, and, as so amended, shall be the by-laws of the Surviving Corporation until thereafter amended in accordance with their terms, the certificate of incorporation of the Surviving Corporation and as provided by law.

SECTION 1.5.   Directors .  Immediately after the Effective Time, Parent shall take the necessary action to cause the directors of Merger Sub immediately prior to the Effective Time to be the directors of the Surviving Corporation, each to hold office in accordance with the certificate of incorporation and by-laws of the Surviving Corporation, until their respective successors are duly elected or appointed and qualified or until the earlier of their death, resignation or removal.

SECTION 1.6.   Officers .  The officers of Merger Sub will be the initial officers of the Surviving Corporation, until their successors are duly elected and qualified or until their

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earlier death, resignation or removal in accordance with applicable law , the certificate of incorporation of the Surviving Corporation and the bylaws of the Surviving Corporation.

ARTICLE II.

EFFECT OF THE MERGER ON THE CAPITAL STOCK
OF THE CONSTITUENT CORPORATIONS

SECTION 2.1.   Conversion of Securities .  At the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, the Company, the Surviving Corporation or the holders of any of the following securities:

(a)           Each share of Common Stock, par value $0.01 per share, of the Company (the “ Common Stock ” or “ Shares ”) issued and outstanding immediately prior to the Effective Time (other than any Shares to be cancelled pursuant to Section 2.1(b) and any Dissenting Shares (as defined in Section 2.3(a)) shall be converted into the right to receive $22.45 in cash (the “ Merger Consideration ”) payable to the holder thereof, without interest, upon surrender of such Shares in the manner provided in Section 2.4, less any required withholding Taxes;

(b)           Each Share held in the treasury of the Company and each Share owned by Parent, Merger Sub or any direct or indirect wholly-owned subsidiary of Parent or the Company immediately prior to the Effective Time shall be automatically cancelled, retired and shall cease to exist without any conversion thereof and no payment or distribution shall be made with respect thereto; and

(c)           Each share of common stock of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted into one validly issued, fully paid and nonassessable share of common stock, par value $0.01 per share, of the Surviving Corporation.

SECTION 2.2.  Options; Stock Appreciation Rights; Restricted Stock Units; Deferred Stock Units; Employee Stock Purchase Plan .

(a)           The Company shall take such actions necessary or appropriate so that, as of the Effective Time (x) the eCollege.com 1999 Stock Incentive Plan, as amended (the “ Stock Incentive Plan ”), and the eCollege.com 2005 Outside Directors Compensation Plan, as amended (the “ Outside Directors Compensation Plan ”) shall be terminated and (y) by virtue of the Merger, without any further action on the part of any holder of any Equity Incentive:

(i)            each option (an “ Option ”) to purchase Shares granted pursuant to any Company Plan that is outstanding and unexercised as of the Effective Time, whether vested or unvested, shall automatically be cancelled and shall cease to exist, and the holder of each such Option shall cease to have any rights with respect thereto, except the right to receive, in consideration for such cancellation, an amount in cash (the “ Option Consideration ”) equal to the product of (A) the number of Shares subject to such Option and (B) the excess, if any, of the Merger Consideration over the exercise price per Share subject to such Option, less any required withholding Taxes;

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(ii)           each stock appreciation right (a “ SAR ”) granted pursuant to any Company Plan that is outstanding as of the Effective Time, whether vested or unvested, shall automatically be cancelled and shall cease to exist, and the holder of each such SAR shall cease to have any rights with respect thereto, except the right to receive, in consideration for such cancellation, an amount in cash (the “ SAR Consideration ”) equal to the product of (A) the number of SAR’s that are deemed vested at the time of the Merger in accordance with the terms of such SAR and (B) the excess, if any, of the Merger Consideration over the applicable Base Price (as defined in the applicable SAR) of each such vested SAR, less any required withholding Taxes;

(iii)          each Share Rights Award (sometimes referred to as a restricted stock unit (a “ RSU ”)) granted pursuant to any Company Plan that is outstanding as of the Effective Time, whether vested or unvested, shall automatically be cancelled and shall cease to exist, and the holder of each such RSU shall cease to have any rights with respect thereto, except the right to receive, in consideration for such cancellation, an amount in cash (the “ RSU Consideration ”) equal to the product of (A) the number of Shares, if any, issuable to each such holder thereof as a result of the consummation of the Merger and (B) the Merger Consideration, less any required withholding Taxes; and

(iv)          each deferred stock unit (a “ DSU ,” and together with the Options, SARs and RSUs being collectively referred to as the “ Equity Incentives ”) granted pursuant to any Company Plan that is outstanding as of the Effective Time, whether vested or unvested, shall automatically be cancelled and shall cease to exist, and the holder of each such DSU shall cease to have rights with respect thereto, except the right to receive, in consideration for such cancellation, an amount in cash (the “ DSU Consideration ,” and together with the Option Consideration, SAR Consideration and RSU Consideration being collectively referred to as the “ Equity Incentive Consideration ”) equal to the product of (A) the number of Shares issuable to each such holder thereof and (B) the Merger Consideration, less any required withholding Taxes.

(b)           The Company shall cause the eCollege.com 1999 Employee Stock Purchase Plan, as amended (the “ Company ESPP ”), to be suspended as of the date hereof, and shall cease further participant payroll deductions thereunder.  The Company shall cause the ESPP to terminate as of the Effective Time and to return all participants’ accumulated payroll deductions thereunder, and no further purchase rights shall be granted or exercised under the ESPP thereafter.

(c)           The Board, or a committee of Non-Employee Directors thereof (as such term is defined for purposes of Rule 16b-3(b)(3) under the Exchange Act), shall adopt a resolution before the Effective Time providing that the disposition by officers and directors of Company Common Stock in exchange for the Merger Consideration, and of Equity Incentives in exchange for the applicable Equity Incentive Consideration, in each case pursuant to the transactions contemplated by this Agreement, are intended to be exempt from liability pursuant to Rule 16b-3 under the Exchange Act.

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SECTION 2.3.  Dissenting Shares .

(a)           Notwithstanding anything in this Agreement to the contrary, Shares that are issued and outstanding immediately prior to the Effective Time and which are held by holders of Shares who have not voted in favor of or consented to the Merger and who have properly demanded and perfected their rights to be paid the fair value of such Shares in accordance with Section 262 of the DGCL (the “ Dissenting Shares ”) shall not be converted into the right to receive the Merger Consideration, and after the Effective Time the holders thereof shall be entitled to only such rights as are granted by Section 262 of the DGCL; provided , however , that if any such holder shall fail to perfect or shall effectively waive, withdraw or lose such holder’s rights under Section 262 of the DGCL, such holder’s Shares shall cease to be deemed Dissenting Shares and thereupon be deemed to have been converted, at the Effective Time, into the right to receive the Merger Consideration therefor, as set forth in Section 2.1 of this Agreement, without any interest thereon.

(b)           The Company shall promptly give Parent (i) notice of any appraisal demands received by the Company, withdrawals thereof and any other instruments served pursuant to Section 262 of the DGCL and received by the Company and (ii) the opportunity to direct all negotiations and proceedings with respect to the exercise of appraisal rights under Section 262 of the DGCL.  The Company shall not, except with the prior written consent of Parent (which consent shall not be unreasonably withheld or delayed) or as otherwise required by applicable law, make any payment with respect to any such exercise of appraisal rights or offer to settle or settle any such rights other than for an amount equal to or less than the Merger Consideration per share.

SECTION 2.4.  Surrender of Shares .

(a)           Prior to the Effective Time, Merger Sub shall enter into an agreement with a paying agent designated by Merger Sub and reasonably satisfactory to the Company to act as paying agent for the stockholders of the Company (and, to the extent any Equity Incentive Consideration is not paid at the Effective Time, shall appoint the same or such other agent reasonably acceptable to the Company to act as paying agent for the holders of Equity Incentives) in connection with the Merger (the “ Paying Agent ”) to receive the Merger Consideration to which the stockholders of the Company shall become entitled pursuant to this Article II.  Immediately prior to the Effective Time Parent shall cause to be deposited with the Paying Agent sufficient funds to make all payments pursuant to Section 2.4(b).  Such funds may be invested by the Paying Agent as directed by Merger Sub or, after the Effective Time, by the Surviving Corporation; provided that (a) no such investment or losses thereon shall affect the Merger Consideration payable to the holders of Common Stock and following any losses Parent shall promptly cause additional funds to be deposited with the Paying Agent for the benefit of the stockholders of the Company in the amount of any such losses and (b) such investments shall be in short-term obligations of the United States of America with maturities of no more than 30 days or guaranteed by the United States of America and backed by the full faith and credit of the United States of America, or in commercial paper obligations rated A-1 or P-1 or better by Moody’s Investors Service, Inc. or Standard & Poor’s Corporation, respectively, or in certificates of deposit, bank repurchase agreements or banker’s acceptances of commercial banks with capital exceeding $1 billion (based on the most recent financial statements of such bank which

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are then publicly available).  Any interest or income produced by, or profit resulting from, such investments will be payable to the Surviving Corporation or Parent, as Parent directs.

(b)           Promptly after the Effective Time, but in any event within two business days following the Effective Time, the Surviving Corporation shall cause to be mailed to each record holder, as of the Effective Time, of either (i) an outstanding certificate or certificates which immediately prior to the Effective Time represented Shares (the “ Certificates ”) or (ii) Shares represented by book-entry (“ Book-Entry Shares ”), a form of letter of transmittal (which shall be in customary form and shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon proper delivery of the Certificates to the Paying Agent or, in the case of Book-Entry Shares, upon adherence to the procedures set forth in the letter of transmittal) and instructions for use in effecting the surrender of the Certificates or, in the case of Book-Entry Shares, the surrender of such Shares for payment of the Merger Consideration therefor.  Upon surrender to the Paying Agent of a Certificate or of Book-Entry Shares, together with such letter of transmittal, duly completed and validly executed in accordance with the instructions thereto, and such other documents as may be required pursuant to such instructions, the holder of such Certificate or Book-Entry Shares shall be entitled to receive in exchange therefor the Merger Consideration for each Share formerly represented by such Certificate or Book-Entry Shares (less any required withholding Taxes) and such Certificate or book-entry shall then be cancelled.  No interest shall be paid or accrued for the benefit of holders of the Certificates or Book-Entry Shares on the Merger Consideration payable in respect of the Certificates or Book-Entry Shares.  If payment of the Merger Consideration is to be made to a person other than the person in whose name the surrendered Certificate or Book-Entry Share is registered, it shall be a condition of payment that the Certificate or Book-Entry Share so surrendered shall be properly endorsed or shall be otherwise in proper form for transfer or be accompanied by all documents required to evidence transfer and that the person requesting such payment shall have paid any transfer and other Taxes required by reason of the payment of the Merger Consideration to a person other than the registered holder of the Certificate or Book-Entry Share surrendered or shall have established to the satisfaction of the Surviving Corporation that such Tax either has been paid or is not applicable.  Until surrendered as contemplated by, and in accordance with, this Section 2.4(b), each Certificate and each Book-Entry Share (other than Certificates or Book Entry Shares representing Shares to be cancelled pursuant to Section 2.1(b) or Dissenting Shares) shall be deemed at any time after the Effective Time to represent only the right to receive upon such surrender the applicable Merger Consideration as contemplated by this Article II.

(c)           All payments with respect to cancelled Equity Incentives, to the extent not made at the Effective Time, shall be made by the Surviving Corporation as promptly as reasonably practicable after the Effective Time.  No interest shall be paid or accrued for the benefit of holders of Equity Incentives on the Equity Incentive Consideration payable in respect thereof.

(d)           At any time following the date that is nine months after the Effective Time, the Surviving Corporation shall be entitled to require the Paying Agent to deliver to it any funds (including any interest received with respect thereto) which have been made available to the Paying Agent and which have not been disbursed to holders of Certificates or Book-Entry Shares and, after such funds have been delivered to the Surviving Corporation, such holders shall

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solely be entitled to look to the Surviving Corporation (subject to abandoned property, escheat or other similar laws) as general creditors thereof with respect to the Merger Consideration payable (without interest) upon due surrender of their Certificates or Book-Entry Shares.  The Surviving Corporation shall pay all charges and expenses, including those of the Paying Agent, in connection with the exchange of Shares for the Merger Consideration.  Neither the Surviving Corporation, Parent, Merger Sub, the Company nor the Paying Agent will be liable to any person in respect of any cash delivered to a public official pursuant to any abandoned property, escheat or similar law.  The Merger Consideration paid in accordance with the terms of this Article II in respect of Certificates or Book-Entry Shares that have been surrendered in accordance with the terms of this Agreement shall be deemed to have been paid in full satisfaction of all rights pertaining to the Shares represented thereby.

(e)           After the Effective Time, the stock transfer books of the Company shall be closed and thereafter there shall be no further registration of transfers of Shares that were outstanding prior to the Effective Time.  After the Effective Time, all Certificates or Book-Entry Shares presented to the Surviving Corporation for transfer shall be cancelled and exchanged for the consideration provided for in, and in accordance with the procedures set forth in, this Article II.

(f)            Notwithstanding anything in this Agreement to the contrary, Parent, the Surviving Corporation and the Paying Agent shall be entitled to deduct and withhold from the consideration otherwise payable to any former holder of Shares or Equity Incentives pursuant to this Agreement any amount as may be required to be deducted and withheld with respect to the making of such payment under applicable Tax laws.  To the extent that amounts are so properly withheld by the Paying Agent, the Surviving Corporation or Parent, as the case may be, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the holder of the Shares or Equity Incentives, as the case may be, in respect of which such deduction and withholding was made by the Paying Agent, the Surviving Corporation or Parent, as the case may be.

(g)           In the event that any Certificate shall have been lost, stolen or destroyed, upon the holder’s compliance with the replacement requirements established by the Paying Agent, and, if required by the Surviving Corporation, the posting by the holder of a bond in customary amount as indemnity against any claim that may be made against it with respect to the Certificate, the Paying Agent will deliver in exchange for the lost, stolen or destroyed Certificate the applicable Merger Consideration payable in respect of the Shares represented by such Certificate pursuant to this Article II.

SECTION 2.5.   Adjustments .  Without limiting the other provisions of this Agreement, if at any time during the period between the date of this Agreement and the Effective Time, any change in the number of outstanding Shares (or securities convertible or exchangeable into or exercisable for Shares) shall occur as a result of a reclassification, recapitalization, stock split (including a reverse stock split), or combination, exchange or readjustment of shares, or any stock dividend or stock distribution with a record date during such period, the Merger Consideration shall be equitably adjusted to reflect such change.

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ARTICLE III.

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company hereby represents and warrants to Parent and Merger Sub that, except as set forth on the Company Disclosure Schedule delivered by the Company to Parent and Merger Sub prior to the execution of this Agreement (the “ Company Disclosure Schedule ”) (it being understood and agreed that any information set forth in one section or subsection of the Company Disclosure Schedule shall be deemed to apply to each other section or subsection of this Agreement to the extent that it is reasonably apparent that such information is relevant to such other section or subsection) and other than with respect to Section 3.3, except as disclosed in any SEC Report (as defined below) filed since January 1, 2007 but prior to the date of this Agreement (other than disclosures in the “Risk Factors” sections of such SEC Reports or in any section relating to forward-looking statements, and any other disclosures included therein to the extent that they are predictive or forward looking in nature) (it being understood and agreed that any information set forth in such SEC Reports shall be deemed to apply only to a section or subsection of this Agreement to the extent that it is reasonably apparent that such information is relevant to such section or subsection):

SECTION 3.1.   Organization and Qualification; Subsidiaries .  The Company and each of its subsidiaries is duly organized, validly existing and in good standing (with respect to jurisdictions that recognize the concept of good standing) under the laws of the jurisdiction of its organization and has all requisite corporate or similar power and authority to own, lease and operate its properties and to carry on its business as it is now being conducted, except where any such failure to be so organized, existing or in good standing or to have such power or authority would not, individually or in the aggregate, have a Material Adverse Effect (as defined below).  The Company and each of its subsidiaries is duly qualified or licensed to do business, and is in good standing, in each jurisdiction where the character of the properties owned, leased or operated by it or the nature of its activities makes such qualification or licensing necessary, other than in such jurisdictions where any such failure to be so qualified or licensed or in good standing would not, individually or in the aggregate, have a Material Adverse Effect.  “ Material Adverse Effect ” means any change, effect, event, circumstance, occurrence or state of facts that is, or would reasonably be expected to, individually or in the aggregate, be materially adverse to the business, financial condition or assets of the Company and its subsidiaries taken as a whole; provided , however , that none of the following, or any changes, effects, events, circumstances, occurrence or state of facts resulting therefrom, shall be deemed in themselves, either alone or in combination, to constitute, and none of them shall be taken into account in determining whether there has been or could or would be, a Material Adverse Effect:  (i) economic, financial market, or geopolitical conditions in general, (ii) general changes or developments in the industries in which the Company and its subsidiaries operate, (iii) the announcement of this Agreement and the transactions contemplated hereby, (iv) any actions required under this Agreement to obtain approval or authorization under applicable antitrust or competition laws for the consummation of the Merger, (v) changes in any laws or regulations or applicable accounting regulations or principles or interpretations thereof, (vi) changes in the market price or trading volume of the Common Stock (provided that any change, effect, event, circumstance, occurrence or state of facts that may have caused or contributed to such change in market price or trading volume shall not be excluded), (vii) the failure, in and of itself, by the Company to meet any expected or

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projected financial or operating performance target, as well as (in and of itself) any change by the Company in any expected or projected financial or operating performance target (provided that any change, effect, event, circumstance, occurrence or state of facts that may have caused or contributed to such failure or change shall not be excluded), or (viii) acts of God, national or international hostilities, war (whether or not declared) or terrorism, unless, in the case of clause (i), (ii), (v) or (viii) such change, effect, event or occurrence has a materially disproportionate effect on the Company and each of its subsidiaries compared with other companies operating in the industry in which the Company and each of its subsidiaries operate.

SECTION 3.2.   Certificate of Incorporation and By-Laws .  The Company has heretofore furnished or otherwise made available to Parent a complete and correct copy of the certificate of incorporation and the by-laws of the Company and each of its subsidiaries, each as currently in effect.  The certificate of incorporation and the by-laws of the Company and each of its subsidiaries are in full force and effect and no other organizational documents are applicable to or binding upon the Company or any of its subsidiaries.  Neither the Company nor any of its subsidiaries are in violation of any provisions of their respective certificate of incorporation or by-laws.

SECTION 3.3.   Capitalization .  The authorized capital stock of the Company consists of (i) 50,000,000 shares of Common Stock and (ii) 5,000,000 shares of Preferred Stock, par value $0.01 per share (the “ Preferred Stock ”).  As of the date hereof, (i) 22,440,297 shares of Common Stock were issued and outstanding, all of which were validly issued, fully paid and nonassessable and were issued free of preemptive rights, (ii) no shares of Preferred Stock were issued and outstanding, and (iii) 14,926 shares of Common Stock were issued and held in treasury.  Section 3.3 of the Company Disclosure Schedule contains (x) a list of all Options, SARs, Restricted Stock Units, Deferred Stock Units and warrants outstanding as of the date hereof, the number of shares of Common Stock, if applicable, issuable thereunder, the expiration date and the exercise price, if applicable, thereof and (y) the number of shares of Common Stock to be purchased pursuant to the Company’s ESPP immediately prior to the Effective Time in accordance with Section 2.2(b).  Except as set forth above:  (A) there are not outstanding or authorized any (I) shares of capital stock or other voting securities of the Company, (II) securities of the Company, convertible into or exchangeable for shares of capital stock or voting securities of the Company, (III) options or other rights to acquire from the Company , and no obligation of the Company, to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company (collectively, “ Company Securities ”), (IV) shares of capital stock or other voting securities of any of the Company’s subsidiaries as of the date hereof, (V) securities of any of the Company’s subsidiaries, convertible into or exchangeable for shares of capital stock or voting securities of any of the Company’s subsidiaries, or (VI) options or other rights to acquire from any of the Company’s subsidiaries, and no obligation of any of the Company’s subsidiaries, to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of any of the Company’s subsidiaries (collectively, “ Subsidiary Securities ”), (B) there are no outstanding obligations of the Company to repurchase, redeem or otherwise acquire any Company Securities or Subsidiary Securities and (C) there are no preemptive rights, other options, calls, warrants, stock appreciation rights, restricted stock units or other rights, agreements, arrangements or commitments of any character relating to the issued or unissued capital stock of the Company or any of its subsidiaries to which the Company or any of its

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subsidiaries is a party.  As of the date of this Agreement, except as set forth in Section 3.3 of the Company Disclosure Schedule, the only principal amount of outstanding Indebtedness of the Company and its subsidiaries or principal amount of outstanding Indebtedness of any other person that is guaranteed by the Company or any of its subsidiaries is $500,000 (face amount) pursuant to the Seller Notes (excluding any intercompany amounts).  “ Indebtedness ” means indebtedness for borrowed money, or any guarantees thereof, of the Company or any of its subsidiaries.  Each of the outstanding shares of capital stock of each of the Company’s subsidiaries is duly authorized, validly issued, fully paid and nonassessable and all such shares are owned by the Company free and clear of all security interests, liens, claims, pledges, agreements, limitations in voting rights, charges or other encumbrances of any nature whatsoever.  The Company has no shareholder rights plan or similar agreements.

SECTION 3.4.   Authority .  The Company has all necessary corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby, subject, in the case of the Merger, to receipt of the Company Requisite Vote (as defined below).  Assuming the accuracy of Parent’s representations and warranties in Section 4.9, the execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action and no other corporate proceeding on the part of the Company is necessary to authorize the execution, delivery and performance of this Agreement or to consummate the transactions so contemplated (other than adoption of this Agreement by the holders of at least a majority of the outstanding Shares (the “ Company Requisite Vote ”) and the filing with the Secretary of State of the State of Delaware of the Certificate of Merger as required by the DGCL).  This Agreement has been duly and validly executed and delivered by the Company and, assuming the due authorization, execution and delivery hereof by Parent and Merger Sub, constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a proceeding in equity or at law).  As of the date of this Agreement, the Board has unanimously (i) determined that the Merger is fair to, and in the best interests of, the Company and the stockholders of the Company, and declared advisable this Agreement and the transactions contemplated hereby, (ii) approved this Agreement in accordance with the DGCL, upon the terms and conditions set forth herein and (iii) resolved to recommend adoption of this Agreement by the stockholders of the Company and to submit this Agreement for adoption by the stockholders of the Company (clauses (i), (ii) and (iii), collectively, the “ Recommendation ”).  The only vote of the stockholders of the Company required to adopt this Agreement and approve the transactions contemplated hereby is the Company Requisite Vote.

SECTION 3.5.   No Conflict; Required Filings and Consents . 

(a)           The execution, delivery and performance of this Agreement by the Company do not and will not, directly or indirectly, (i) conflict with or violate the certificate of incorporation or by-laws of the Company, (ii) assuming that all consents, approvals and authorizations contemplated by clauses (i) through (iv) of subsection (b) below have been obtained, and all filings described in such clauses have been made, conflict with or violate any

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law, rule, regulation, order, judgment or decree applicable to the Company or any of its subsidiaries or by which its or any of their respective properties are bound or (iii) require notice to or consent of any third party, result in any breach or violation of or constitute a default (or an event which with notice or lapse of time or both would become a default) or result in the loss of a benefit under, or give rise to any right of termination, cancellation, amendment or acceleration of, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit or other instrument or obligation (each, a “ Contract ”) to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or its or any of their respective properties are bound, except, in the case of clauses (ii) and (iii), for any such notice, consent, conflict, violation, breach, default, loss, right or other occurrence which would not, individually or in the aggregate, have a Material Adverse Effect.

(b)           The execution, delivery and performance of this Agreement by the Company and the consummation of the Merger by the Company do not and will not require any notice, consent, approval, authorization or permit of, action by, filing with or notification to, any governmental or regulatory (including stock exchange) authority, agency, court, commission, or other governmental body (each, a “ Governmental Entity ”), except for (i) applicable requirements of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), and the rules and regulations promulgated thereunder (including the filing of the Proxy Statement (as defined below)), the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended and the rules and regulations promulgated thereunder (the “ HSR Act ”), and state securities, takeover and “blue sky” laws, (ii) the applicable requirements of the NASDAQ National Market, (iii) the filing with the Secretary of State of the State of Delaware of the Certificate of Merger as required by the DGCL, and (iv) any such consent, approval, authorization, permit, action, filing or notification the failure of which to make or obtain would not (A) prevent or materially delay the Company from performing its obligations under this Agreement in any material respect or (B) individually or in the aggregate, have a Material Adverse Effect.

SECTION 3.6.   Compliance .  (a) Neither the Company nor any of its subsidiaries is in violation of any law, rule, regulation, order, judgment or decree applicable to the Company or any of its subsidiaries or by which its or any of their respective properties are bound, except for any such violation which would not, individually or in the aggregate, have a Material Adverse Effect, (b) the Company and its subsidiaries have all permits, licenses, authorizations, exemptions, orders, consents, approvals and franchises (“ Licenses ”) from Governmental Entities required to conduct their respective businesses as now being conducted, except for any such Licenses the absence of which would not, individually or in the aggregate, have a Material Adverse Effect and (c) neither the Company nor any of its subsidiaries has any material subscription liability, material escheatment liability or any material liability related to unclaimed or abandoned property laws.  This Section 3.6 does not relate to matters relating to the Sarbanes-Oxley Act (as defined in Section 3.7(c)), which are the subject of Section 3.7(c), employee benefit matters, which are the subject of Section 3.10, and Taxes, which are the subject of Section 3.14.

SECTION 3.7.  SEC Filings; Financial Statements; Undisclosed Liabilities .

(a)           The Company has filed or otherwise transmitted all forms, reports, statements, certifications and other documents (including all exhibits, amendments and

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supplements thereto) required to be filed by it with the Securities and Exchange Commission (the “ SEC ”) since January 1, 2004 (all such forms, reports, statements, certificates and other documents filed since January 1, 2004, collectively, the “ SEC Reports ”).  Each of the SEC Reports, as amended prior to the date hereof, complied in all material respects with the applicable requirements of the Securities Act of 1933, as amended (the “ Securities Act ”), and the rules and regulations promulgated thereunder and the Exchange Act and the rules and regulations promulgated thereunder, each as in effect on the date so filed.  None of the SEC Reports contained, when filed as finally amended prior to the date hereof, any untrue statement of a material fact or omitted to state a material fact required to be stated or incorporated by reference therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.  To the knowledge of the Company, as of the date hereof, there are no unresolved SEC comments.

(b)           The audited consolidated financial statements of the Company (including any related notes thereto) included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 filed with the SEC have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto) and fairly present in all material respects the consolidated financial position of the Company and its subsidiaries at the respective dates thereof and the consolidated statements of operations, cash flows and changes in stockholders’ equity for the periods indicated.  The unaudited consolidated financial statements of the Company (including any related notes thereto) for all interim periods included in the Company’s quarterly reports on Form 10-Q filed with the SEC since January 1, 2007 have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto) and fairly present in all material respects the consolidated financial position of the Company and its subsidiaries at the respective dates thereof and the consolidated statements of operations and cash flows for the periods indicated (subject to normal period-end adjustments).

(c)           Since the enactment of the Sarbanes-Oxley Act of 2002, as amended (the “ Sarbanes-Oxley Act ”), the Company has been and is in compliance in all material respects with the applicable provisions of the Sarbanes-Oxley Act.

(d)           The Company has designed, established and maintained  disclosure controls and procedures, or caused such disclosure controls and procedures (as such terms are defined in Rule 13a-15(c) under the Exchange Act) to be designed under its supervision, as required by Rule 13a-15(a) under the Exchange Act, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to the individuals responsible for the preparation of the Company’s filings with the SEC and other public disclosure documents.

(e)           The Company has disclosed, based on its most recent evaluation prior to the date hereof, to the Company’s auditors and the audit committee of the Board (A) any significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect in any material respect the Company’s ability to record, process, summarize and report financial information and (B) any

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fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal controls over financial reporting.

(f)            As of the date hereof, to the knowledge of the Company, the Company has not identified any material weaknesses in the design or operation of internal controls over financial reporting.  To the knowledge of the Company, there is no reason to believe that its auditors and its Chief Executive Officer and Chief Financial Officer will not be able to give the certification and attestations required pursuant to the rules and regulations adopted pursuant to Section 404 of the Sarbanes-Oxley Act when next due.

(g)           Except (i) as reflected or reserved against in the financial statements included in the Company’s Quarterly Report on Form 10-Q filed prior to the date hereof for the quarter ended March 31, 2007, (ii) for liabilities or obligations incurred in the ordinary course of business consistent with past practice since March 31, 2007, or (iii) for liabilities or obligations under this Agreement or the fees and expenses of attorneys, investment bankers, accountants and other advisors to the Company incurred in connection with the transactions contemplated hereby, neither the Company nor any of its subsidiaries has any liabilities, commitments or obligations of any nature, asserted or unasserted, known or unknown, absolute or contingent, whether or not accrued, matured or unmatured or otherwise, that are of a nature that would be required to be disclosed on a balance sheet of the Company (or the footnotes thereto) prepared in accordance with generally accepted accounting principles, other than those which have not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; it being understood that in no event will the provisions set forth in this Section 3.7(g) apply to any particular matter if such matter is addressed more specifically in any other representation and warranty contained in this Article III.

(h)           Each Equity Incentive (i) was granted in all material respects in compliance with (A) all applicable Laws and (B) all of the material terms and conditions of the Company Plan pursuant to which it was issued, (ii) qualifies for the tax and accounting treatment afforded to such Equity Incentive in the Company’s tax returns and the Company’s financial statements, respectively and (iii) has a per share exercise price, if applicable, determined in accordance with the applicable Company Plan and, to the extent required pursuant to the terms of the applicable Company Plan, that was greater than or equal to the fair market value of a Share (determined in accordance with the applicable Company Plan) on the applicable date on which the related grant was by its terms to be effective.

SECTION 3.8.   Absence of Certain Changes or Events .

(a)           From January 1, 2007, except as contemplated by this Agreement, the Company and its subsidiaries have conducted their business in the ordinary course consistent with past practice and, during such period, there has not been any change, event or occurrence which, individually or in the aggregate, has had a Material Adverse Effect

(b)           From January 1, 2007 to the date of this Agreement, there has not been (i) any declaration, setting aside or payment of any dividend or other distribution in cash, stock, property or otherwise in respect of the Company’s or any of its subsidiaries’ capital stock, except for any dividend or distribution by a subsidiary of the Company; (ii) any redemption, repurchase

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or other acquisition by the Company or any of its subsidiaries of (x) any shares of capital stock of the Company or any of its subsidiaries or (y) any options, warrants, calls or rights to acquire, or securities that are convertible into or exchangeable for, any shares of capital stock or other voting securities (except upon the exercise of options, warrants, calls or rights disclosed to Parent to the extent net exercises are provided for in the plans or agreements governing such options, warrants, calls or rights); (iii) (x) any granting by the Company or any of its subsidiaries to any of their directors or officers of any material increase in compensation or fringe benefits, except for increases in the ordinary course of business consistent with past practice or increases that are required under any Company Plan, (y) any granting to any director or officer of the right to receive any severance or termination pay not provided for under any Company Plan, or (z) any entry by the Company or any of its subsidiaries into (I) any employment, consulting or severance agreement or arrangement with any director or officer of the Company or its subsidiaries, or (II) any employment, consulting or severance agreement or arrangement (other than the hiring of employees in the ordinary course of business consistent with past practice who do not enter into employment agreements and are entitled to no severance other than pursuant to the policy described in Section 6.6(a) of the Company Disclosure Schedule) pursuant to which total annual compensation or aggregate severance benefits exceed $200,000 individually or $500,000 in the aggregate with any other employee of the Company or its subsidiaries, or any material amendment of any Company Plan; (iv) any extension, renewal, amendment or modification in any material respect or termination of any Real Property Lease or any Material Contract or any waiver, release or assignment any material rights or claims with respect thereto; (v) any material change by the Company in its accounting methods, principles or practices, except as may be required to conform to changes in statutory or regulatory accounting rules or generally accepted accounting principles or regulatory requirements with respect thereto; (vi) any settlement or compromise of any material Tax liability by the Company or any of its subsidiaries; or (vii) any material change in Tax accounting principles or Tax elections by the Company or any of its subsidiaries, except insofar as may have been required by applicable law.

SECTION 3.9.   Absence of Litigation .  There are no suits, claims, actions, proceedings, arbitrations, mediations or investigations pending or, to the knowledge of the Company, threatened against the Company or any of its subsidiaries, other than any such suit, claim, action, proceeding, arbitration, mediation or investigation that would not, individually or in the aggregate, have a Material Adverse Effect.  As of the date hereof, neither the Company nor any of its subsidiaries nor any of their respective properties is or are subject to any order, writ, judgment, injunction, decree or award except for those that would not, individually or in the aggregate, have a Material Adverse Effect.  There are no SEC inquiries or investigations, other governmental inquiries or investigations or internal investigations pending or, to the knowledge of the Company, threatened, in each case regarding any accounting practices of the Company or any of its subsidiaries or any malfeasance by any executive officer of the Company.

SECTION 3.10.  Employee Benefit Plans .

(a)           Section 3.10(a) of the Company Disclosure Schedule contains a true and complete list of each material Company Plan.  As used herein the term “ Company Plan ” means each “ employee benefit plan ” (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ ERISA ”)), and each other compensation or benefit plan, program, agreement or arrangement contributed to, sponsored or maintained by

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the Company or any of its subsidiaries or with respect to which any of them are a party or have any obligations, as of the date hereof for the benefit of any current or former employee, consultant, independent contractor or director of the Company or any of its subsidiaries (the “ Company Employees ”).

(b)           With respect to each Company Plan, the Company has made available to the Parent a copy thereof (or, if the plan is not written, a written description thereof) and, to the extent applicable, (i)  the most recent determination letter, if any, received from the Internal Revenue Service (the “ IRS ”), (ii) the most recent summary plan description and (iii) for the most recent year (A) the Form 5500 and attached schedules, and (B) audited financial statements, if any.

(c)           Except as failure to do so would not, individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect, each Company Plan has been administered in compliance with the applicable provisions of ERISA, the Internal Revenue Code of 1986, as amended (the “ Code ”), and other applicable laws, rules and regulations.

(d)           Neither the Company nor any other corporation or other trade or business that is treated as part of a single employer with the Company under Sections 414(b) or (c) of the Code contributes to, or has any liability under, any plan that is a “multiemployer plan” as defined in Section 3(37) of ERISA, subject to Title IV of ERISA or any other employee benefit plan subject to Title IV of ERISA.

(e)           Except as would not, individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect, with respect to each Company Plan, no actions, suits or claims (other than routine claims for benefits) are pending or, to the knowledge of the Company, threatened.

(f)            Each Company Plan that is intended to be qualified under Section 401(a) of the Code has received a determination letter to that effect from the IRS or is in the form of a prototype or volume submitter plan with respect to which the IRS has issued a favorable opinion letter, and, except as would not individually or in the aggregate be reasonably expected to result in a Material Adverse Effect, the Company is aware of no circumstances that would reasonably be expected to adversely affect such plan’s qualification.

(g)           The execution, delivery of and performance by the Company of its obligations under the transactions contemplated by this Agreement (either alone or upon the occurrence of any additional or subsequent event) will not  (i) result in any payment, acceleration, vesting,  increase in benefits or obligation to fund benefits with respect to any Company Employee, (ii) result in the triggering or imposition of any restrictions or limitations on the right of the Company or any of its subsidiaries to amend or terminate any Company Plan or (iii) result in any “excess parachute payments” within the meaning of Section 280G(b)(1) of the Code.

(h)           Except as would not, individually or in the aggregate, have a Material Adverse Effect, each Company Plan that is a “nonqualified deferred compensation plan” (as

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defined under Section 409A(d)(1) of the Code) has been operated and administered in good faith compliance with Section 409A of the Code since January 1, 2005.

(i)            Except as would not, individually or in the aggregate, have a Material Adverse Effect, (x) all contributions to Company Plans that were required to be made under such Company Plans have been made, and (y) the Company has performed all material obligations required to be performed under all Company Plans.  Except as would not, individually or in the aggregate, have a Material Adverse Effect, with respect to each Company Plan that is funded wholly or partially through an insurance policy, all premiums required to have been paid as of the date of this Agreement under the insurance policy have been paid.

SECTION 3.11.  Labor and Employment Matters .

(a)           Neither the Company nor any of its subsidiaries is a party to any collective bargaining agreement or other labor union agreement applicable to employees of the Company or any of its subsidiaries, nor to the knowledge of the Company as of the date of this Agreement are there any formal activities or proceedings of any labor union to organize any such employees.  Neither the Company nor any of its subsidiaries has engaged in, admitted committing, or be held in any administrative or judicial proceeding to have committed any unfair labor practice under the National Labor Relations Act in the five years preceding the date of its execution of this Agreement.   There are no unfair labor practice complaints pending against the Company or any of its subsidiaries before the National Labor Relations Board or any other labor relations tribunal or authority.  There are no material complaints, charges or claims against the Company pending, or to the knowledge of the Company, threatened to be brought or filed with any Governmental Entity based on, arising out of, in connection with, or otherwise relating to the employment of any individual by the Company.   There are no strikes, work stoppages, slowdowns, lockouts, material arbitrations or material grievances, or other material labor disputes pending or, to the knowledge of the Company, threatened in writing against or involving the Company or any of its subsidiaries.

(b)           In the three-year period preceding the date hereof, there has been no “mass layoff” or “plant closing” (as defined by the Worker Adjustment and Restraining Notification Act (“ WARN Act ”)) with respect to the Company.  The Company has taken no action that could reasonably be expected to give rise to any liability under the WARN Act for which the Parent, the Merger Sub or the Surviving Corporation could be liable.

SECTION 3.12.   Insurance .  Except as would not, individually or in the aggregate, have a Material Adverse Effect, all material insurance policies of the Company and its subsidiaries (a) are in full force and effect and provide insurance in such amounts and against such risks as is sufficient to comply with applicable law, (b) neither the Company nor any of its subsidiaries is in breach or default, and neither the Company nor any of its subsidiaries has taken any action or failed to take any action which, with notice or the lapse of time, would constitute such a breach or default, or permit termination or modification of, any of such insurance policies and (c) no notice of cancellation or termination has been received with respect to any such policy.

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SECTION 3.13.   Properties .  The Company or one of its subsidiaries (i) has good title to all the material properties and material assets reflected in the latest audited balance sheet included in the SEC Reports as being owned by the Company or one of its subsidiaries or acquired after the date thereof that are material to the Company’s business on a consolidated basis (except properties sold or otherwise disposed of since the date thereof in the ordinary course of business consistent with past practice), free and clear of all claims, liens, charges, security interests, encroachments or encumbrances of any nature whatsoever, except (A) mechanics’, carriers’, workmen’s, repairmen’s, warehousemen’s or other like liens arising or incurred in the ordinary course of business relating to obligations that are not delinquent or that are being contested in good faith by the Company or any of its subsidiaries, (B) liens for Taxes, assessments and other governmental charges that are not yet due and payable, that may thereafter be paid without material interest or penalty, that have been adequately provided for in accordance with generally accepted accounting principles or for amounts being contested in good faith, (C) such imperfections or irregularities of title, claims, liens, charges, security interests, easements, covenants and other restrictions or encumbrances as do not materially affect the use of the properties or assets subject thereto or affected thereby or otherwise materially impair business operations at such properties, (D) zoning, building and other similar codes and regulations provided the same are not materially violated, (E) liens or other encumbrances that have been placed by any developer, landlord or other third party on any real property in which the Company or any of its subsidiaries has a leasehold interest and subordination or similar agreements relating thereto (in each case, where the applicable leasehold is subordinated thereto by its stated terms or under applicable law), and (G) any conditions that may be shown by a current, accurate survey or physical inspection of any real property, and (ii) is the lessee of all material leasehold estates reflected in the latest audited financial statements included in the SEC Reports or acquired after the date thereof that are material to its business on a consolidated basis (except for leases that have expired by their terms since the date thereof or been assigned, terminated or otherwise disposed of in accordance with their terms in the ordinary course of business consistent with past practice) and is in possession of the properties purported to be leased thereunder, and each such material lease is valid without default thereunder by the lessee or, to the Company’s knowledge, the lessor (such lease and related documents affecting real property being called “ Real Property Leases ”)).  Each Real Property Lease is in full force and effect and not subject to any sublets or similar arrangements.  Neither the Company, nor any of its subsidiaries, owns any fee interests in Real Property.

SECTION 3.14.   Tax Matters .

(a)           Except as set forth on Section 3.14 of the Company Disclosure Schedule (i) all Tax Returns required to be filed by the Company and its subsidiaries prior to the date hereof have been timely filed (taking into account all valid extensions) and were correct and complete in all material respects, (ii) as of the date hereof, all Taxes of the Company and its subsidiaries required to have been paid have been paid on or before the due date for payment thereof (except to the extent such Taxes are being contested in good faith), (iii) the unpaid Taxes of the Company and its subsidiaries did not, as of the date of the most recent financial statements included in the SEC Reports, exceed the reserve for Tax liability (rather than any reserve for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the face of the most recent balance sheet included in the SEC Reports (rather than in any notes thereto), (iv) there are no actions, suits, proceedings, investigations, claims or audits in

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progress or pending with respect to Taxes of the Company or any of its subsidiaries, (v) there are no liens for Taxes (other than Taxes not yet due and payable, that may thereafter be paid without interest or penalty, or for amounts being contested in good faith) upon any of the assets of the Company or any of its subsidiaries, and (vi) neither the Company nor any of its subsidiaries (A) has been a member of an affiliated group filing a consolidated federal income Tax Return (other than a group the common parent of which was the Company) or (B) has any liability for the Taxes of any person (other than the Company, or any subsidiary of the Company) under Treasury regulation section 1.1502-6 (or any similar provision of state, local or foreign law) or as a transferee or successor.

(b)           As of the date of this Agreement, there is not in force any extension of time with respect to the due date for the filing of any Tax Return by the Company or any of its subsidiaries or any waiver or agreement for any extension of time for the assessment or payment of any Tax by the Company or any of its subsidiaries.  All deficiencies asserted or assessments made as a result of any examinations have been fully paid, or are being contested in good faith and an adequate reserve therefor has been established in accordance with GAAP and are fully reflected in the financial statements included in the SEC Reports.  Neither the Company nor any of its subsidiaries has any material liability for unpaid Taxes incurred after the date of the most recent financial statements included in the SEC Reports, other than Taxes incurred by it in the ordinary course of business.

(c)           The Company is not a party to or bound by, and does not have and has not had any obligations under, any tax indemnity, tax sharing, tax allocation or similar agreement that includes a party other than the Company or any of its subsidiaries.  Neither the Company nor any of its subsidiaries has constituted either a “distributing corporation” or a “controlled corporation” in a distribution of stock qualifying or purporting to qualify for tax-free treatment under Section 355 of the Code.  No deductions for compensation paid or accrued by the Company up to the date of the Effective Time are subject to limitation under Section 162(m) of the Code.  Neither the Company nor any of its subsidiaries is obligated to make any payments, or is a party to any agreement that under certain circumstances could obligate it to make payments, that would result in an excise Tax to the recipient of such payments pursuant to Section 4999 of the Code.  No claim has been asserted in writing during the past three years against the Company or any of its subsidiaries by a Taxing Authority in a jurisdiction where such enti