E3 CORP, S-1, 1998-06-09

E3 CORP
S-1, 1998-06-09

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 9, 1998
REGISTRATION NO. 333-
================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------

FORM S-1
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
---------------------------

E3 CORPORATION
(Exact Name of Registrant as Specified in its Charter)

<TABLE>
<S> <C> <C>
GEORGIA 7372 58-1828841
(State or other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
</TABLE>

---------------------------

1800 PARKWAY PLACE, SUITE 600
MARIETTA, GEORGIA 30067
(770) 424-0100
(Address, Including Zip Code and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
---------------------------

ANDERS H. HERLITZ
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
E3 CORPORATION
1800 PARKWAY PLACE, SUITE 600
MARIETTA, GEORGIA 30067
(770) 424-0100
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
---------------------------
Copies to:

<TABLE>
<S> <C>
JOHN C. YATES, ESQ. CARMELO M. GORDIAN, ESQ.
GRANT W. COLLINGSWORTH, ESQ. S. MICHAEL DUNN, ESQ.
LAUREN Z. BURNHAM, ESQ. PHILIP W. RUSSELL, ESQ.
MORRIS, MANNING & MARTIN, L.L.P. BROBECK, PHLEGER & HARRISON, LLP
1600 ATLANTA FINANCIAL CENTER 301 CONGRESS AVENUE
3343 PEACHTREE ROAD, N.E. SUITE 1200
ATLANTA, GEORGIA 30326 AUSTIN, TEXAS 78701
TELEPHONE: (404) 233-7000 TELEPHONE: (512) 477-5495
FACSIMILE: (404) 365-9532 FACSIMILE: (512) 477-5813
</TABLE>

---------------------------

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement is declared effective.
If any of the securities being registered on this Form are offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act") please check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, please check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
---------------------------

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
==================================================================================================================
TITLE OF EACH CLASS OF PROPOSED MAXIMUM AGGREGATE AMOUNT OF
SECURITIES REGISTERED OFFERING PRICE (1) REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Common Stock, $.05 par value.................... $40,000,000 $11,800
==================================================================================================================
</TABLE>

(1) Estimated solely for the purpose of computing the registration fee in
accordance with Rule 457(o) under the Securities Act of 1933, as amended.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SECTION 8(A), MAY DETERMINE.
================================================================================
<PAGE> 2

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OR AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

Subject To Completion, Dated June , 1998
PROSPECTUS

[E3 LOGO]

E3 CORPORATION

COMMON STOCK
---------------------------

Of the shares of Common Stock offered hereby,
shares are being sold by E3 Corporation (the "Company" or "E3")
and shares are being sold by the Selling Shareholders (the
"Selling Shareholders"). The Company will not receive any proceeds from the sale
of shares by the Selling Shareholders. Prior to this offering (the "Offering"),
there has been no public market for the Common Stock. It is currently estimated
that the initial public offering price of the Common Stock will be between
$ and $ per share. See "Underwriting" for a discussion of the factors to
be considered in determining the initial public offering price. The Company has
applied for quotation of the Common Stock on the Nasdaq National Market under
the symbol "EIII."

THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 6.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
=================================================================================================================================
Proceeds to
Price to Underwriting Discounts Proceeds to Selling
Public and Commissions(1) Company(2) Shareholders
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Per Share.................... $ $ $ $
- ---------------------------------------------------------------------------------------------------------------------------------
Total (3).................... $ $ $ $
=================================================================================================================================
</TABLE>

(1) For information regarding indemnification of the Underwriters, see
"Underwriting."
(2) Before deducting expenses of the Offering payable by the Company, estimated
at $ .
(3) The Company and the Selling Shareholders have granted the Underwriters an
option, exercisable within 30 days from the date hereof, to purchase up to
a total of additional shares of Common Stock on the same terms and
conditions as set forth above, solely to cover over-allotments, if any. If
such option is exercised in full, the total Price to Public will be
$ , the Underwriting Discounts and Commissions will be $ , the
Proceeds to Company will be $ , and the Proceeds to Selling
Shareholders will be $ . See "Principal and Selling Shareholders" and
"Underwriting."
---------------------------

The shares of Common Stock offered by the Underwriters are subject to prior
sale, receipt and acceptance by them and are subject to the right of the
Underwriters to reject any order in whole or in part and certain other
conditions. It is expected that delivery of such shares will be made through the
offices of UBS Securities LLC, 299 Park Avenue, New York, New York, on or about
, 1998.
---------------------------

UBS SECURITIES SBC WARBURG DILLON READ INC.
SOUNDVIEW FINANCIAL GROUP, INC.

, 1998
<PAGE> 3

IN CONNECTION WITH THIS OFFERING, CERTAIN UNDERWRITERS AND SELLING GROUP
MEMBERS (IF ANY) OR THEIR RESPECTIVE AFFILIATES MAY ENGAGE IN PASSIVE MARKET
MAKING TRANSACTIONS IN THE COMMON STOCK ON THE NASDAQ NATIONAL MARKET IN
ACCORDANCE WITH RULE 103 OF REGULATION M UNDER THE SECURITIES AND EXCHANGE ACT
OF 1934, AS AMENDED. SEE "UNDERWRITING."

CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK,
INCLUDING BY ENTERING STABILIZING BIDS, EFFECTING SYNDICATE COVERING
TRANSACTIONS OR IMPOSING PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES,
SEE "UNDERWRITING."
ii
<PAGE> 4

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by the more detailed
information and Consolidated Financial Statements and Notes thereto appearing
elsewhere in this Prospectus. This Prospectus contains forward-looking
statements which involve risks and uncertainties. The Company's actual results
could differ materially from those anticipated in these forward-looking
statements as a result of certain factors, including those set forth under "Risk
Factors" and elsewhere in this Prospectus.

THE COMPANY

E3 is a leading provider of inventory management software solutions
designed to help businesses make purchasing decisions that optimize inventory
levels and increase profitability. The Company's solutions are designed
primarily for businesses in the wholesale and retail segments of the supply
chain. The Company complements its software products with a range of services
that leverage its comprehensive buying process expertise. To date, substantially
all of the Company's revenue has been generated through its direct sales force
based in the United States and abroad. E3 has provided solutions to a broad
range of distributors, wholesalers and retail chains in the general retail;
pharmaceutical; general manufacturing; electrical, industrial and automotive
supply; food and food service; wine and spirits; and office supply industries,
among others. Founded in 1980, E3 has installed its systems at more than 600
customers in 16 countries. Customers include Ace Hardware, Best Buy, CVS
Pharmacy, Eckerd Drugs, Rubbermaid, Staples, The Sports Authority and Victoria's
Secret. In the United States, E3's customers include seven of the largest ten
drug wholesalers, five of the largest ten drug retailers, 22 of the largest 50
food service distributors, and eight of the largest 17 hardware wholesalers.

Today's increasingly competitive business environment has forced
manufacturers, distributors and retailers to change their business practices.
There has been a fundamental shift in market power from manufacturers to
retailers and consumers. This shift in market power has had a profound effect on
the supply chain, which consists of the flow of goods from suppliers to
manufacturers, then to wholesalers and warehouses, next to distributors and
retailers, and ultimately, to the consumer. The competitive nature of today's
end markets requires retailers and wholesalers to effectively manage their
supply chains in order to provide their customers with the right products, at
the right price, and at the precise time and place they are needed.

As a result of these recent trends, a significant need has developed for
optimized inventory management solutions that: (i) not only track inventory
levels but also measure and improve inventory profitability; (ii) provide
sophisticated decision-support tools combined with simulation capabilities that
analyze numerous purchasing factors, such as demand patterns, purchasing costs,
the receipt and management of inventory, vendor pricing and discounts, and
forecasted demand; (iii) respond to changing business factors by automatically
recommending the optimal purchasing decisions; and (iv) enable companies to
manage millions of stock-keeping units ("SKUs") over broad geographic regions
with many stores and distributed users. Finally, the solutions should be easy to
implement, use and maintain.

The Company's solutions address the complex requirements of inventory
management by factoring in forward-buying and alternate-buying opportunities
while minimizing the required inventory levels needed to meet pre-established
customer service objectives. The Company's solutions are based on a
comprehensive suite of software modules, including demand forecasting, lead time
forecasting, order policy analysis, service level analysis, replenishment
analysis, investment analysis and order validity analysis. The Company offers
consulting and educational services that help customers maximize profitability
through the use of the Company's proprietary inventory management software and
techniques.

The Company's software solutions provide comprehensive and advanced
inventory management capabilities that enable organizations to reduce
inventories, increase profitability and meet customer service objectives. The
Company's product offerings target four distinct markets: (i) E3TRIM targets
warehouse inventory management; (ii) E3SLIM targets store inventory management;
(iii) E3CRISP targets vendor managed inventories; and (iv) ProfitTrack focuses
on shared services inventory management.

3
<PAGE> 5

The Company intends to maintain its leadership position in the inventory
management market by continuing to provide comprehensive and advanced
applications that allow customers to optimize inventory management. Key elements
of the Company's strategy include maintaining and enhancing its technology
leadership, expanding product offerings and targeting new market opportunities,
maintaining high quality customer relationships through consulting and
education, broadening distribution channels and strategic relationships and
increasing penetration of international markets.

The Company was founded in 1980 and incorporated in Georgia in 1986 as
Technology Investment Leasing & Loan, Inc. In 1998, the Company changed its name
to E3 Corporation. When used in this Prospectus, unless the context requires
otherwise, the term "Company" refers to E3 Corporation and its consolidated
subsidiaries. The Company's principal executive offices are located at 1800
Parkway Place, Suite 600, Marietta, Georgia 30067 and its telephone number is
(770) 424-0100.

THE OFFERING

Common Stock offered by the Company.... shares

Common Stock offered by the Selling
Shareholders........................... shares

Common Stock to be outstanding after
the Offering........................... shares(1)

Use of Proceeds........................ For working capital and other
general corporate purposes including
possible acquisitions.

Proposed Nasdaq National
Market Symbol........................ EIII
- ---------------

(1) Excludes (i) 3,000,000 shares of Common Stock reserved for issuance upon the
exercise of options granted under the E3 Corporation Stock Incentive Plan
(the "Stock Incentive Plan"), of which options to purchase 898,919 shares
were outstanding as of the date of this Prospectus, at a weighted average
exercise price of $10.00 per share; and (ii) 148,354 shares of Common Stock
issuable upon the exercise of non-plan options outstanding as of the date of
this Prospectus, at a weighted average exercise price of $9.10 per share.
See "Management -- Stock Option and Other Compensation Plans."

4
<PAGE> 6

SUMMARY CONSOLIDATED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
THREE MONTHS
YEAR ENDED DECEMBER 31, ENDED MARCH 31,
-------------------------------------------------- -----------------
1993 1994 1995 1996 1997 1997 1998
------- ------- -------- -------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF INCOME DATA:
Software license fees................ $ 4,827 $ 7,545 $ 11,199 $ 12,589 $ 14,519 $ 5,185 $ 4,107
Services and maintenance fees........ 2,340 3,576 5,044 7,200 10,342 2,351 3,392
------- ------- -------- -------- -------- ------- -------
Total revenue...................... 7,167 11,121 16,243 19,789 24,861 7,536 7,499
Income from operations............... 1,115 2,173 2,917 3,738 3,673 3,153 1,507
Net income........................... 857 1,249 2,058 2,261 2,258 1,874 893
Net income per share -- basic and
diluted............................ $ 0.05 $ 0.08 $ 0.13 $ 0.14 $ 0.14 $ 0.12 $ 0.06
Shares used in computing net income
per share -- basic and
diluted(1)......................... 15,850 15,555 15,555 15,645 15,649 15,649 15,649
Cash dividends declared per common
share.............................. $ -- $ 0.02 $ 0.04 $ 0.02 $ 0.02 $ -- $ --
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31, 1997 MARCH 31, 1998
----------------- ---------------------
AS
ACTUAL ADJUSTED(2)
------- -----------
<S> <C> <C> <C>
CONSOLIDATED BALANCE SHEET DATA:
Cash and cash equivalents................................. $ 7,318 $ 9,248 $
Working capital........................................... 5,573 6,318
Total assets.............................................. 15,824 16,519
Long-term debt, net of current portion.................... -- --
Shareholders' equity...................................... 6,838 7,650
</TABLE>

- ---------------

(1) See Note 1 of Notes to Consolidated Financial Statements.
(2) As adjusted to give effect to the sale by the Company of the
shares of Common Stock offered hereby at an assumed initial public offering
price of $ per share, after deducting the estimated underwriting
discounts and commissions and estimated offering expenses payable by the
Company, and the application of the estimated net proceeds therefrom. See
"Use of Proceeds" and "Capitalization."

Unless otherwise indicated, the information contained in this Prospectus
assumes (i) no exercise of outstanding stock options and (ii) no exercise of the
Underwriters' over-allotment option.

E3(R), E3 Design(R), E3CRISP(R), E3SLIM(R) and E3TRIM(R) are registered
trademarks of the Company. This Prospectus also includes trademarks, service
marks, trade names and references to intellectual property owned by other
companies.

5
<PAGE> 7

RISK FACTORS

An investment in the shares of Common Stock offered hereby involves a high
degree of risk. In addition to the other information in this Prospectus, the
following risk factors should be considered carefully in evaluating an
investment in the Common Stock offered by this Prospectus. When used in this
Prospectus, the words "may," "will," "intends," "plans," "expects,"
"anticipates," "estimates" and similar expressions are intended to identify
forward-looking statements. Such statements are subject to risks and
uncertainties that could cause actual results to differ materially from those
projected. These risks and uncertainties include, but are not limited to, those
risks discussed below and elsewhere in this Prospectus. Actual results could
differ materially from those projected in the forward-looking statements as a
result of the risk factors discussed below and elsewhere in this Prospectus.

Potential Variability of Quarterly Operating Results and Seasonality. The
Company's operations, revenue and operating results are uncertain and are
expected to vary substantially from quarter to quarter. Among the factors
causing these potential variations are fluctuations in the demand for the
Company's products, the level of product and price competition in the Company's
markets, the length of the Company's sales cycle, the size and timing of
individual transactions, the mix of products and services sold, delays in or
cancellations of customer implementations, the timing of new product
introductions and enhancements by the Company or its competitors, the Company's
ability to attract and retain key technical, sales and managerial personnel, the
ratio of international to domestic sales, commercial strategies adopted by
competitors, changes in foreign currency exchange rates, customers' budget
constraints, the Company's ability to control costs and general economic
conditions. In addition, the Company has in the past, and may in the future,
provide a customer with a right to receive a full refund of the license fees
paid if such customer is dissatisfied with the Company's products in the period
following installation (typically up to 90 days). The grant of such a right may
have the effect of delaying the Company's recognition of revenue from such
license fees. In addition, in each year in which the Company paid bonuses to
certain executive officers, such bonuses were based on year-end operating
results and were paid in the fourth quarter, which has resulted in substantially
increased general and administrative expenses in that quarter. As a result of
the foregoing factors, comparisons of future operating results with prior
periods should not be relied upon as indicators of actual performance in future
periods. The Company establishes its expenditure levels for consulting, product
development, sales and marketing and other operating expenses based, in large
part, on its expected future revenue. Furthermore, since software license sales
are typically accompanied by a substantial amount of consulting, implementation
and support services, the Company's consulting and support resources must be
managed to meet anticipated software license revenue. As a result, any
unexpected decline in software license revenue is likely to adversely and
disproportionately affect operating results and net income because only a small
portion of the Company's expenses vary with its revenue. Based upon all of the
foregoing, the Company believes that its quarterly and annual revenue, expenses
and operating results are likely to vary significantly in the future and that
period-to-period comparisons of its operating results are not necessarily
meaningful. As a result, the Company's operating results for any particular
quarter may be below the expectations of securities analysts and investors,
which could materially and adversely affect the market price of the Company's
Common Stock. See "Management's Discussion and Analysis of Financial Condition
and Results of Operations."

The Company's quarterly operating results are also subject to certain
seasonal fluctuations. The Company's revenue, particularly its software license
fee revenue, and operating results are typically strongest in the first and
fourth quarter and weakest in the third quarter. The Company's revenue and
operating results for the first quarter typically benefit from customers making
corporate information technology ("IT") purchasing decisions early in the budget
year. The Company's revenue and operating results for the fourth quarter
typically benefit from the efforts of the Company's sales force to meet year-end
sales quotas and the tendency for IT departments to spend the remaining portion
of IT budgets prior to year-end. The Company experiences lower sales levels in
the third quarter, due in large part to the general decline in business activity
in Europe during the summer months.

Product Concentration. In recent years, the Company has derived a majority
of its revenue from its E3TRIM product. In 1997, the Company derived
approximately 70% of its revenue from sales of E3TRIM, and sales of E3TRIM may
continue to account for a majority of the Company's revenue for the foreseeable
future. As a result, the Company's future operating results are dependent upon
continued market acceptance
6
<PAGE> 8

of E3TRIM and enhancements thereto. While the Company intends to develop and
introduce new products, the Company's success will depend on continued market
acceptance of its existing products, particularly its E3TRIM, E3SLIM and E3CRISP
products, as well as the Company's ability to introduce new versions of its
existing products. There can be no assurance that the Company's products will
continue to achieve market acceptance or that the Company will introduce
enhanced versions of its products on a timely basis, or at all, to meet the
evolving needs of its customers. Any material reduction in demand for the
Company's products, increased competition in the market for supply chain
management software or technological changes could have a material adverse
effect on the Company's business, operating results and financial condition. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and "Business -- Products."

Dependence on IBM AS/400 Platform. Although the Company is in the process
of porting the server portion of its products to additional platforms, including
UNIX and Windows NT, the server portion of its products is currently designed to
operate solely on the AS/400 platform offered by International Business Machines
Corporation ("IBM"). The Company believes that it has lost sales in the past due
to prospective customers' refusal to purchase AS/400 hardware. Any decline in
the market for or support of the AS/400 platform, or any refusal on the part of
prospective customers generally to purchase AS/400 hardware for the operation of
the Company's products, may have a material adverse effect on the Company's
business, operating results and financial condition. In addition, there can be
no assurance that IBM will continue to develop and market AS/400 products in the
future. See "Business -- Products."

Dependence on Emerging Market for Supply Chain Management Software. The
Company currently derives, and is expected to continue to derive, a substantial
portion of its revenue from licenses and services related to its supply chain
management software products, particularly E3TRIM, E3SLIM and E3CRISP. Although
demand for these products has grown in recent periods, the market for enterprise
software in general, and for supply chain management software in particular, is
still emerging and there can be no assurance that it will continue to grow or
that even if the market does grow, businesses will continue to adopt the
Company's products. The Company has spent, and intends to continue to spend,
considerable resources educating potential customers generally about supply
chain management, inventory management software solutions and, specifically, its
products. However, there can be no assurance that such expenditures will enable
the Company's product line to achieve any additional degree of market
acceptance. If the supply chain management software market fails to grow or
grows more slowly than the Company currently anticipates, the Company's
business, operating results and financial condition could be materially and
adversely affected. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Business -- Products."

Ability to Manage Growth. In recent years, the Company has rapidly and
significantly expanded its overall operations, including expanding the
geographic scope of its operations. Furthermore, the Company anticipates that
significant additional expansion will be required to properly address potential
market opportunities. For example, the Company has increased its direct sales
force from 15 salespersons in 1996 to 38 salespersons as of March 31, 1998. The
Company anticipates that it will continue to significantly increase the size of
its sales and marketing, support, services and product development operations,
both domestically and internationally, following the completion of the Offering.
There can be no assurance that such expansion will be completed successfully or
that it will generate sufficient revenue to cover the Company's expenses or
produce operating margins at rates comparable to those historically achieved by
the Company.

In addition, the Company is currently in the process of implementing new
management information and accounting software and systems (the "MIS System").
The Company's ability to implement the MIS System, especially in view of the
broad geographic scope of the Company's operations, will place substantial
demands on certain of the Company's managerial resources. If the Company is
unable to implement the MIS System in a timely manner, the Company's ability to
generate consolidated financial reports on a timely basis and to forecast and
manage its business accurately, may be adversely affected. Furthermore, the
Company has recently begun the process of developing the management and support
capabilities necessary to support its anticipated growth. For example, in July
1997, the Company hired its current Chief Financial Officer, R. Lee Morris, and
subsequently has made other additions to management in an effort to manage and
support the expansion of
7
<PAGE> 9

the Company's product and service offerings and the scope of its operations. The
ability of the Company to manage its growth, if any, will depend in large part
on its ability to expand its management and support capabilities (both
domestically and internationally), to implement the MIS System throughout its
operations, to improve and expand its operational and sales and marketing
capabilities, to develop the management skills of its managers and supervisors,
and to train, motivate and manage both its existing and future employees. There
can be no assurance that the Company will succeed in achieving any of these
objectives and any failure to do so could have a material adverse effect on the
Company's business, operating results and financial condition. See
"Business -- Sales and Marketing" and "Management."

Dependence on Key Executive; Ability to Hire and Retain Personnel. The
Company's success will depend in large part upon the continued availability of
the services of Anders H. Herlitz, the Company's Chairman and Chief Executive
Officer. The loss of the services of Mr. Herlitz could have a material adverse
effect on the Company's business, operating results and financial condition. The
Company does not maintain key man insurance on the life of Mr. Herlitz.

The Company believes its future success and ability to achieve revenue
growth will depend in significant part upon its ability to identify, attract,
retain and motivate highly skilled management, technical, support, service,
sales and marketing personnel. In particular, the Company's ability to install,
maintain and enhance its products is substantially dependent upon its ability to
locate, hire, train and retain qualified technical consultants. The software
industry is characterized by a high level of employee mobility and aggressive
recruiting of skilled personnel. Competition for personnel in all of these areas
is intense, and recruiting such personnel is becoming increasingly difficult
worldwide. The Company has been forced from time to time to increase
compensation levels to attract and retain key personnel. In view of the critical
roles of the Company's product development and consulting staffs, the Company's
inability to recruit additional personnel to, or the loss of a significant part
of, these staffs, or the loss of one or more other key personnel could have a
material adverse effect on the Company's business, operating results and
financial condition. There can be no assurance that the Company will be able to
retain its key employees or that it will be successful in attracting,
assimilating and retaining additional key employees in the future. Furthermore,
there can be no assurance that compensation levels will not increase
significantly in the future in order to attract and retain key personnel. The
failure to attract, assimilate and retain key personnel on a cost-effective
basis could have a material adverse effect on the Company's business, operating
results and financial condition. See "Business -- Employees" and "Management."

Risks Associated with International Operations. The Company derived
approximately 27%, 35% and 30% of its total revenue for 1995, 1996 and 1997,
respectively, from international sales. The Company's products currently are
marketed in North America, Europe, South America and Australia, and the Company
has offices or representatives in ten locations worldwide. The Company's future
success and ability to achieve revenue growth will depend upon the continued
expansion of its international sales, support, service and marketing
organizations and its ability to establish indirect distribution channels,
including relationships with systems vendors, application software vendors and
systems integrators, in international markets. Such international expansion has
required, and will continue to require, the Company to establish additional
offices, to hire additional personnel and to extend its MIS System in
international markets, which in turn have required, and will increasingly
require, significant management attention and financial resources and could
adversely affect the Company's operating margins and ability to sustain
profitability. To the extent that the Company is unable to expand efficiently
and in a timely manner, its growth, if any, in international sales will be
limited, and as a result, the Company's business, operating results and
financial condition could be materially and adversely affected. Further, the
Company intends to continue to expand its international operations by increasing
the number of direct customer support personnel in existing markets and in
additional international markets. Accordingly, the Company's business, including
its ability to expand its operations internationally, is subject to the risks
inherent in international business activities, including, in particular, greater
difficulty in safeguarding its intellectual property, general economic
conditions in each country, foreign currency exchange rate fluctuations, overlap
of different tax structures, management of an organization spread over various
countries, unexpected changes in regulatory requirements, compliance with a
variety of foreign laws and regulations, and longer accounts receivable payment
cycles in certain countries. Other risks associated with

8
<PAGE> 10

international operations include import and export licensing requirements, trade
restrictions and changes in tariff rates. Any of the foregoing factors could
have a material adverse effect on the Company's ability to expand its
international operations which could materially and adversely affect the
Company's business, operating results and financial condition. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
"Business -- Sales and Marketing."

Exposure to Currency Fluctuations. A significant portion of the Company's
business is conducted in currencies other than the U.S. dollar (the Company's
reporting currency). As a result, depreciation of the value of the other
currencies in which the Company generates revenue relative to the U.S. dollar
could adversely affect operating results. The consolidated financial statements
of the Company are translated from the functional currency of certain of its
operating subsidiaries into U.S. dollars utilizing the current rate method.
Accordingly, assets and liabilities are translated at exchange rates in effect
at the end of the reporting period, and revenue and expenses are translated at
the average exchange rate during the period. All translation gains or losses
from the translation into the Company's reporting currency are included under
comprehensive income as a separate component of shareholders' equity.
Fluctuations in other currencies relative to the U.S. dollar will affect
period-to-period comparisons of the Company's reported consolidated results of
operations. Moreover, as a result of the significant uncertainty concerning the
effects of the conversion of many Western European currencies to a single
currency, it is possible that the relative value of the currencies of
participating countries will be subject to extreme volatility during the
conversion process, which is currently scheduled to begin in 1999. Due to the
constantly changing currency exposures and the volatility of currency exchange
rates, there can be no assurance that the Company will not experience currency
losses in the future, nor can the Company predict the effect of exchange rate
fluctuations upon future operating results. The Company does not currently
undertake hedging transactions to cover its currency exposure, but the Company
may choose to hedge a portion of its currency exposure in the future as, and to
the extent that, the Company deems it appropriate to do so. Fluctuations in the
exchange rates of currencies in which the Company's business is conducted,
particularly to the extent that the Company's international sales increase as a
percentage of total sales, could have a material adverse effect on the Company's
business, operating results and financial condition. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations."

Risks Associated with Rapid Technological Advances; Necessity of Developing
New Products. The market for supply chain management software is subject to
rapid technological change, changing customer needs, frequent new product
introductions and evolving industry standards that may render existing products
and services obsolete. As a result, the Company's position in this market could
be eroded rapidly by unforeseen changes in customer requirements for application
features, functions and technologies or increased competition. The Company's
growth and future operating results will depend in part upon its ability to
enhance existing applications and develop and introduce new applications that
meet or exceed technological advances in the marketplace, respond to changing
customer requirements, provide superior functions, features and performance than
that offered by competitors' products and achieve market acceptance. The
Company's product development and testing efforts have required, and are
expected to continue to require, substantial investments by the Company. There
can be no assurance the Company will continue to possess sufficient resources to
make necessary investments in technology. In addition, there can be no assurance
that the Company's products will meet the requirements of the marketplace and
achieve market acceptance or that the Company's current or future products will
conform to applicable industry standards, especially as such standards evolve.
If the Company is unable, for technological or other reasons, to develop and
introduce new and enhanced products in a timely manner, the Company's business,
operating results and financial condition likely would be materially and
adversely affected. See "Business -- Competition" and "-- Product Development
and Technology."

Lengthy Sales Cycle. The sale of the Company's products generally requires
the Company to provide a significant level of education to prospective customers
regarding the use and benefits of its supply chain management solutions.
Implementation of the Company's products involves a further commitment of
resources by the Company and the customer. For these and other reasons, the
length of time between the date of initial contact with a potential customer and
the ultimate sale of the Company's products typically ranges from three to nine
months and is subject to delays over which the Company may have little or no
control. In

9
<PAGE> 11

addition, as the average dollar size of the sale of the Company's products and
services increases, the Company expects the sales cycle to lengthen as
additional internal approval procedures often will be required by prospective
customers. Although the Company has significantly increased the size of its
direct sales force over the past year, it will need to continue hiring qualified
sales personnel, particularly as future sales cycles lengthen. Failure to
attract and retain such persons or delays in sales of the Company's products
could have a material adverse effect on the Company's business, operating
results and financial condition and exacerbate quarter-to-quarter fluctuations
in the Company's operating results. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Quarterly Results of
Operations" and "Business -- Sales and Marketing."

Competition. The market for the Company's products is intensely
competitive, highly fragmented and subject to rapid change. Competitors include:
(i) enterprise resource application ("ERP") software vendors such as SAP AG,
PeopleSoft, Inc., Oracle Corporation and Baan Company N.V., each of which
currently offers ERP solutions that may incorporate supply chain management
modules or advanced planning and scheduling software; (ii) other suppliers of
advanced planning and scheduling software, including i2 Technologies Inc.,
Manugistics Group, Inc. and Logility Inc.; (iii) other business application
software vendors who may broaden their product offerings by internally
developing, or by acquiring or partnering with independent developers of,
advanced planning and scheduling software; (iv) internal development efforts by
corporate IT departments; and (v) companies offering standardized or customized
products for mainframe and/or mid-range computer systems. Increased competition
may result in reduced operating margins and loss of market share, either of
which could have a material adverse effect on the Company's business, financial
condition and results of operations.

Many of the Company's competitors and potential competitors have longer
operating histories, significantly greater financial, technical, marketing and
other resources, greater name recognition and larger installed customer bases
than the Company. In order to be successful in the future, the Company must
continue to respond promptly and effectively to technological change and
competitors' innovations. There can be no assurance that current or potential
competitors of the Company will not develop products comparable or superior in
terms of price and performance to those developed by the Company. In addition,
no assurance can be given that the Company will not be required to make
substantial additional investments in connection with its product development,
sales and marketing, and customer service efforts in order to meet any
competitive threat, or that the Company will be able to compete successfully in
the future. Increased competition will result in reductions in market share,
pressure for price reductions and related reductions in gross margins, any of
which could materially and adversely affect the Company's business, operating
results and financial condition. There can be no assurance that in the future
the Company will be able to successfully compete against current and future
competitors and the failure to do so could have a material adverse effect on the
Company's business, operating results and financial condition. See
"Business -- Competition."

Potential Liability to Clients. Many of the Company's solutions are
critical to the operations of its customers' businesses and provide benefits
that may be difficult to quantify. Any failure in a customer's system could
result in a claim for substantial damages against the Company, regardless of the
Company's responsibility for such failure. Although the Company attempts to
limit contractually its liability for damages arising from negligent acts,
errors, mistakes or omissions, there can be no assurance that the limitations of
liability set forth in its contracts will be enforceable in all instances or
would otherwise protect the Company from liability for damages. Although the
Company maintains general liability insurance coverage, including coverage for
errors or omissions, there can be no assurance that such coverage will continue
to be available on reasonable terms or will be available in sufficient amounts
to cover one or more large claims or that the insurer will not disclaim coverage
as to any future claim. The successful assertion of one or more large claims
against the Company that exceed available insurance coverage or changes in the
Company's insurance policies, including premium increases or the imposition of
large deductible or co-insurance requirements, could adversely affect the
Company's business, operating results and financial condition.

Risk of Software Defects. Software products as complex as those offered by
the Company frequently contain errors or defects, especially when first
introduced or when new versions or enhancements are released. Despite product
testing, the Company has in the past released new versions of its products with
defects that
10
<PAGE> 12

were discovered only after installation and use by customers. The Company
regularly introduces new releases and periodically introduces new versions of
its products. There can be no assurance that, despite testing by the Company and
by its customers, defects and errors will not be found in existing products or
in new products, releases, versions or enhancements after commencement of
commercial shipments. Any such defects and errors could result in adverse
customer reactions, negative publicity regarding the Company and its products,
harm to the Company's reputation, loss of or delay in market acceptance, loss of
revenue or require product changes, any of which could have a material adverse
effect on the Company's business, operating results and financial condition. See
"Business -- Products."

Pricing of Consulting Services. The Company's consulting services
historically have been billed to customers on a time-and-materials basis. The
Company recently has developed pricing policies for its consulting services that
will result in an increasing portion of such services being provided on a
fixed-price basis, often at the request of its customers. Under fixed-price
arrangements, the Company will be required to provide services at the agreed
price regardless of the actual costs the Company may incur in rendering such
services. As a result, to the extent that actual costs exceed projected costs,
the Company's gross margins in performing such services will be adversely
affected, which could have a material adverse effect on the Company's business,
operating results and financial condition. See "Business -- Services and
Support."

Intellectual Property Rights. The Company relies on a combination of
copyright, trade secret, trademark and trade dress laws, confidentiality
procedures and contractual provisions to protect its proprietary rights in its
products and technology. The Company generally enters into confidentiality
agreements with its employees, consultants, customers and potential customers
and limits access to, and distribution of, its proprietary information. The
Company maintains trademarks to identify the source of its products, development
tools and service offerings and relies upon trademark and trade dress laws to
protect its proprietary rights in these marks. The Company licenses its products
to its customers in object code format and restricts the customer's use to
internal purposes without the right to sublicense its products. However, the
Company believes that the foregoing measures afford only limited protection. In
connection with certain of its license agreements, the Company has established
in the past, and may continue to establish, escrows of the source code for its
licensed products with third parties for the benefit of its customers. There can
be no assurance that unauthorized use of the Company's source code for its
products will not occur as a result of these escrow arrangements. Despite the
Company's efforts to safeguard and maintain its proprietary rights both in the
United States and abroad, there can be no assurance that the Company will be
successful in doing so or that the steps taken by the Company in this regard
will be adequate to deter misappropriation or independent third-party
development of the Company's technology or to prevent an unauthorized third
party from copying or otherwise obtaining and using the Company's products or
technology. In addition, policing unauthorized use of the Company's products is
difficult, and while the Company is unable to determine the extent to which
piracy of its software products exists, software piracy may currently be or
could become a problem.

As the number of supply chain management applications in the industry
increases and the functionality of these products further overlaps, software
development companies like the Company may increasingly become subject to claims
of infringement or misappropriation of the intellectual property rights of
others. There can be no assurance that third parties will not assert
infringement or misappropriation claims against the Company in the future with
respect to current or future products. Any claims or litigation, with or without
merit, could be time consuming, result in costly litigation, diversion of
management's attention and cause product shipment delays or require the Company
to enter into royalty or licensing arrangements. Such royalty or licensing
arrangements, if required, may not be available on terms acceptable to the
Company, if at all, which could have a material adverse effect on the Company's
business, operating results and financial condition. Adverse determinations in
such claims or litigation also could have a material adverse effect on the
Company's business, operating results and financial condition.

The Company may be subject to additional risks as it enters into
transactions in countries where intellectual property laws are not well
developed or are poorly enforced. Legal protections of the Company's rights may
be ineffective in such countries. Litigation to defend and enforce the Company's
intellectual property rights could result in substantial costs and diversion of
resources and could have a material adverse effect on the Company's business,
operating results and financial condition, regardless of the final outcome of
11
<PAGE> 13

such litigation. Despite the Company's efforts to safeguard and maintain its
proprietary rights both in the United States and abroad, there can be no
assurance that the Company will be successful in doing so, or that the steps
taken by the Company in this regard will be adequate to deter misappropriation
or independent third-party development of the Company's technology or to prevent
an unauthorized third party from copying or otherwise obtaining and using the
Company's products or technology. Any such events could have a material adverse
effect on the Company's business, operating results and financial condition. See
"Business -- Proprietary Rights and Licenses."

Risks Associated with Strategic Relationships. A component of the
Company's strategy is to establish formal and informal relationships with third
parties to rapidly address the market opportunities for the Company's products.
These relationships have been, and will continue to be, primarily with
consulting and systems integration firms as well as ERP and other software
providers. The establishment and maintenance of these relationships involve a
number of risks, including: (i) substantial investment of the Company's
resources in the relationship; (ii) potential inability to realize the intended
benefits of the relationship; (iii) increased reliance on third parties; (iv)
potential for payment of third-party license fees or royalties for the
incorporation of third-party technology into the Company's products; and (v)
inadvertent transfer of the Company's proprietary technology to strategic
"partners". In addition, ERP and other software providers with whom the Company
has or establishes relationships may have products that are perceived to be
competitive with the Company's products, which could lessen the effectiveness of
such relationships. These providers also often have prior relationships or
establish relationships with the Company's customers and prospective customers
and could leverage these relationships to cause customers or prospective
customers to cease using or to not purchase the Company's products. There can be
no assurance that the Company will be successful in identifying and entering
into strategic relationships, if at all, and any inability to do so could have a
material adverse effect on the Company's business, operating results and
financial condition. See "Business -- Strategy."

Risks Associated with Possible Acquisitions. The Company in the future may
engage in selective acquisitions of other businesses or technologies, including
other providers of supply chain management solutions or technology. While the
Company has in the past considered acquisition opportunities, it has never
acquired a significant business and, as of the date of this Prospectus, has no
existing agreements or commitments to effect any acquisition. Accordingly, there
can be no assurance that the Company will be able to identify suitable
acquisition candidates available for sale at reasonable prices, consummate any
acquisition or successfully integrate any acquired business into the Company's
operations. Further, acquisitions may involve a number of special risks,
including diversion of management's attention, failure to retain key acquired
personnel, unanticipated events or circumstances, legal liabilities and
amortization of acquired intangible assets, some or all of which could have a
material adverse effect on the Company's business, operating results and
financial condition. Problems with an acquired business could have a material
adverse impact on the performance of the Company as a whole. The Company may
elect to finance any future acquisitions with the proceeds of the Offering, as
well as with possible debt financing or through the issuance or sale of equity
securities (common or preferred stock), or any combination of the foregoing.
There can be no assurance that the Company will be able to arrange adequate
financing on acceptable terms. If the Company were to proceed with one or more
significant future acquisitions in which the consideration consisted of cash, a
substantial portion of the Company's available cash (including a portion of the
proceeds of the Offering) could be used to consummate the acquisitions. If the
Company were to consummate one or more significant acquisitions in which the
consideration consisted of stock, shareholders of the Company could suffer
dilution of their interests in the Company. Many business acquisitions must be
accounted for using the purchase method of accounting. Most of the businesses
that might become attractive acquisition candidates for the Company are likely
to have significant intangible assets, and acquisition of these businesses, if
accounted for as a purchase, would typically result in substantial goodwill
amortization charges to the Company, which would reduce future earnings. In
addition, such acquisitions could involve non-recurring acquisition-related
charges, such as write-offs or write-downs of acquired software development
costs or other intangible items, which could have a material adverse effect on
the Company's operating results for the quarter in which such charges occur. See
"Business -- Strategy."

12
<PAGE> 14

Year 2000 Compliance. Many currently installed computer systems and
software products are coded to accept only two digit entries in the date code
field. Beginning in the year 2000, these date code fields will need to accept
four digit entries to distinguish twenty-first century dates from twentieth
century dates. As a result, over the next two years, computer systems and/or
software used by many companies may need to be upgraded to comply with such
"Year 2000" requirements. Significant uncertainty exists in the software
industry concerning the potential effects associated with such compliance. All
of the Company's products have been designed to be Year 2000 compliant.

The Company believes that the purchasing patterns of customers and
potential customers may be affected by Year 2000 issues in a variety of ways.
Many companies are expending significant resources to correct or patch their
current software systems for Year 2000 compliance. These expenditures may result
in reduced funds available to purchase software products such as those offered
by the Company. Potential customers may also choose to defer purchasing Year
2000 compliant products until they believe it is absolutely necessary, thus
potentially resulting in stalled market sales within the industry. Conversely,
Year 2000 issues may cause other companies to accelerate purchases, thereby
causing an increase in short-term demand and a consequent decrease in long-term
demand for software products. Additionally, Year 2000 issues could cause a
significant number of companies, including current customers of the Company, to
reevaluate their current software needs and as a result, switch to other systems
or suppliers. Finally, the Company's software may be integrated with a
customer's non-Year 2000 compliant system, which could lessen the effectiveness
of the Company's solutions. Any of the foregoing could result in a material
adverse effect on the Company's business, operating results and financial
condition.

Concentration of Control. Upon completion of the Offering, the Company's
directors and executive officers and affiliates will beneficially own
approximately % of the Company's outstanding Common Stock. As a result,
these shareholders will have the ability to elect the Company's directors and to
determine the outcome of corporate actions requiring shareholder approval. This
concentration of ownership may have the effect of delaying or preventing a
change of control of the Company. See "Management" and "Principal and Selling
Shareholders."

In addition, the Offering will provide substantial benefits to current
shareholders of the Company, including directors and executive officers of the
Company. Consummation of the Offering is expected to (i) create a public market
for the Company's Common Stock; (ii) provide an opportunity for the Selling
Shareholders to register their shares of Common Stock for resale; and (iii)
allow current shareholders to realize appreciation in the value of the shares of
Common Stock presently held by them. See "Principal and Selling Shareholders"
and "Shares Eligible for Future Sale."

Broad Management Discretion as to Use of Proceeds. Substantially all of
the net proceeds to be received by the Company in connection with the Offering
will be allocated to working capital and available for general corporate
purposes. Accordingly, management will have broad discretion with respect to the
expenditure of such proceeds. Purchasers of shares of Common Stock offered
hereby will be entrusting their funds to the Company's management, upon whose
judgment they must depend, with limited information concerning the specific
working capital requirements and general corporate purposes to which the funds
will ultimately be applied. See "Use of Proceeds."

Certain Anti-Takeover Provisions. Under the Company's Amended and Restated
Articles of Incorporation (the "Restated Articles"), the Board of Directors has
the authority to issue up to 50,000,000 shares of Preferred Stock and to fix the
rights, preferences, privileges and restrictions, including voting rights, of
the Preferred Stock without further vote or action by the Company's
shareholders. The rights and preferences of any series of such Preferred Stock
could include a preference over the Common Stock on the distribution of the
Company's assets upon a liquidation or sale of the Company, preferential
dividends, redemption rights, the right to elect one or more directors and other
voting rights. The rights of the holders of the Common Stock will be subject to,
and may be adversely affected by, the rights of the holders of shares of
Preferred Stock that may be issued in the future. While the Company has no
present intention to issue shares of Preferred Stock, such issuance, while
providing desired flexibility in connection with possible acquisitions and other
corporate purposes, could have the effect of making it more difficult for a
third party to acquire a majority of the

13
<PAGE> 15

outstanding voting stock of the Company. In addition, the Company's Restated
Articles and Amended and Restated Bylaws (the "Restated Bylaws") contain
provisions that may discourage proposals or bids to acquire the Company
including provisions establishing a Board of Directors with staggered,
three-year terms, requiring supermajority voting to effect certain amendments to
the Restated Articles, limiting the persons who may call special meetings of
shareholders, and establishing advance notice requirements for nominations for
election to the Board of Directors or for proposing matters that can be acted
upon at shareholders' meetings. These provisions could have the effect of making
it more difficult for a third party to acquire control of the Company. See
"Description of Capital Stock -- Certain Articles of Incorporation and Bylaw
Provisions" and "-- Certain Provisions of Georgia Law."

Shares Eligible for Future Sale. Sales of substantial amounts of Common
Stock in the public market, or the perception that such sales may occur, could
adversely affect the prevailing market price of the Common Stock or the ability
of the Company to raise capital through a public offering of its equity
securities. Upon completion of the Offering, the Company will have outstanding
shares of Common Stock (not including shares issuable upon exercise of
outstanding stock options). Under agreements entered into between the
representatives of the Underwriters and each of the Company's officers,
directors, principal shareholders and their respective affiliates (the "Lock-Up
Agreements") who beneficially held in the aggregate shares of Common
Stock prior to the Offering, no shares held by such holders will be eligible for
sale in the public market for a period of 180 days following the date of this
Prospectus. The Company intends to file a registration statement under the
Securities Act of 1933, as amended (the "Securities Act"), covering the sale of
Common Stock reserved for issuance under the Stock Incentive Plan. As of May 30,
1998, there were options outstanding to purchase an aggregate of 1,047,273
shares, and all shares acquired upon exercise of options within 180 days of the
Offering are or will be subject to Lock-Up Agreements. Following the expiration
of the 180-day term of the Lock-Up Agreements, shares, including the
shares offered hereby and shares which may be purchased upon the
exercise of options then exercisable, will be eligible for sale in the public
market subject, in some cases, to compliance with Rule 144 or Rule 701 under the
Securities Act. UBS Securities LLC in its sole discretion and at any time
without notice, may release all or any portion of the securities subject to the
Lock-Up Agreements. Any such decision to release securities would likely be
based upon individual shareholder circumstances, prevailing market conditions
and other relevant factors. Any such release could have a material effect upon
the price of the Common Stock. See "Underwriting".

No Prior Public Market for Common Stock; Possible Volatility of Stock
Price. Prior to the Offering, there has been no public market for the Common
Stock. Although the Company has made application for the quotation of the Common
Stock on the Nasdaq National Market, there can be no assurance that an active
trading market will develop or be sustained after the Offering. In the event the
Company fails to appoint an additional independent director within 90 days after
the Offering, the National Association of Securities Dealers, Inc. could
terminate the listing of the Common Stock on the Nasdaq National Market, which
would have a material adverse effect on the liquidity and trading price of the
Common Stock. See "Management -- Election of Directors."

The initial public offering price of the Common Stock offered hereby will
be determined by negotiation between the Company, the Selling Shareholders and
the Underwriters and may bear no relationship to the market price of the Common
Stock after the Offering. See "Underwriting."

The market price of the Common Stock could be subject to significant
fluctuations based on a number of factors, including the announcement of new
products, product enhancements or services by the Company or its competitors,
variations in quarterly operating results of the Company or of the Company's
competitors, changes in earnings estimates or recommendations by securities
analysts, developments in the Company's industry and in its customers'
industries, general market and economic conditions and other factors. In
addition, stock prices for many companies in the technology and emerging growth
sectors have experienced wide fluctuations which often have been unrelated to
the operating performance of such companies. Such factors and fluctuations may
adversely affect the market price of the Common Stock.

Dilution. The estimated initial public offering price is substantially
higher than the book value per share of the outstanding Common Stock. As a
result, the purchasers of the Common Stock offered hereby will

14
<PAGE> 16

experience immediate and significant dilution of $ from the estimated
initial public offering price. In addition, the Company has issued options to
purchase Common Stock at prices below the estimated initial public offering
price. To the extent such outstanding options are exercised, there will be
further dilution to purchasers in the Offering. See "Dilution."

USE OF PROCEEDS

The net proceeds to the Company from the sale of the shares
of Common Stock offered by the Company hereby are estimated to be approximately
$ million, assuming an initial public offering price of $ per share
and after deducting estimated underwriting discounts and commissions and
estimated expenses payable by the Company in connection with the Offering. The
Company will not receive any proceeds from the sale of Common Stock by the
Selling Shareholders.

The Company intends to use the net proceeds from the Offering primarily for
working capital and other general corporate purposes including possible
acquisitions. The Company has no specific agreements, commitments or
understandings with respect to any acquisition. The amounts actually expended
for each purpose may vary significantly and are subject to change at the
Company's discretion depending upon certain factors, including economic or
industry conditions, changes in the competitive environment and strategic
opportunities that may arise. In addition, the Company believes that it is in
its best interest to create a public market for the Company's Common Stock to
facilitate future access to public market funds and provide the availability of
a publicly-traded stock in the event the Company desires to utilize its shares
in connection with future acquisitions. The Company also anticipates that as the
result of being a publicly-traded company, it will receive increased visibility,
credibility and overall acceptance in the marketplace. Pending application of
the net proceeds as described above, the Company intends to invest the net
proceeds of the Offering in investment-grade, interest-bearing securities. See
"Risk Factors -- Broad Management Discretion as to Use of Proceeds" and
"Business -- Strategy."

DIVIDEND POLICY

The Company paid cash dividends to its shareholders in an aggregate amount
of approximately $304,000 in each of 1996 and 1997. Although the Company has
historically declared and paid cash dividends on its capital stock, the Company
does not intend to declare or pay any cash dividends in the foreseeable future.
Management anticipates that all future earnings and other cash resources of the
Company, if any, will be retained by the Company for investment in its business.
The payment of dividends is subject to the discretion of the Board of Directors
of the Company and will depend on the Company's results of operations, financial
position and capital requirements, general business conditions, restrictions
imposed by financing arrangements, if any, legal and regulatory restrictions on
the payment of dividends and other factors that the Company's Board of Directors
deems relevant.

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<PAGE> 17

CAPITALIZATION

The following table sets forth as of March 31, 1998: (i) the actual
capitalization of the Company; and (ii) such capitalization as adjusted to
reflect the issuance and sale by the Company of the shares of
Common Stock offered hereby at an assumed initial public offering price of
$ per share, after deducting the estimated underwriting discounts and
commissions and estimated offering expenses payable by the Company, and the
application of the estimated net proceeds to the Company of the Offering. See
"Use of Proceeds." This table should be read in conjunction with the Company's
Consolidated Financial Statements and Notes thereto appearing elsewhere in this
Prospectus.

<TABLE>
<CAPTION>
AS OF
MARCH 31, 1998
------------------
AS
ACTUAL ADJUSTED
------- --------
(IN THOUSANDS)
<S> <C> <C>
Shareholders' equity:
Preferred Stock, $.01 par value; Actual -- none authorized
or issued; As adjusted -- 50,000,000 shares authorized
and none issued........................................ $ -- $ --
Common stock, $.05 par value; Actual -- 50,000,000 shares
authorized, 15,649,350 shares issued; As
adjusted -- 100,000,000 shares authorized and
shares issued(1)....................................... 782
Retained earnings......................................... 7,054 7,054
Other comprehensive income (loss)......................... (186) (186)
------- -------
Total shareholders' equity........................ 7,650
------- -------
Total capitalization.............................. $ 7,650 $
======= =======
</TABLE>

- ---------------

(1) Excludes: (i) 3,000,000 shares of Common Stock reserved for issuance upon
the exercise of options granted under the Stock Incentive Plan, of which
options to purchase 898,919 shares were outstanding as of the date of this
Prospectus, at a weighted average exercise price of $10.00 per share; and
(ii) 148,354 shares of Common Stock presently reserved for issuance upon the
exercise of non-plan options outstanding as of the date of this Prospectus,
at a weighted average exercise price of $9.10 per share. See
"Management -- Stock Option and Other Compensation Plans."

16
<PAGE> 18

DILUTION

As of March 31, 1998, the net tangible book value of the Company was
approximately $ , or $ per share of Common Stock. Net tangible book
value per share represents the amount of the Company's total tangible assets
less total liabilities, divided by the number of shares of Common Stock
outstanding. After giving effect to the sale by the Company of the
shares of Common Stock offered hereby at an assumed initial
public offering price of $ per share and the application of the estimated
net proceeds therefrom, after deducting estimated underwriting discounts and
commissions and estimated offering expenses payable by the Company, the net
tangible book value of the Company at March 31, 1998, would have been
approximately $ million, or $ per share of Common Stock. This
represents an immediate increase in such net tangible book value of $ per
share to existing shareholders and an immediate dilution of $ per share to
new investors. The following table illustrates this unaudited per share dilution
to new investors:

<TABLE>
<S> <C> <C>
Assumed initial public offering price per share............. $
-------
Net book value per share as of March 31, 1998............. $ 0.49
-------
Increase in net book value per share attributable to new
investors..............................................
-------
Adjusted net book value per share after the Offering........
=======
Dilution per share to new investors......................... $
-------
</TABLE>

The following table sets forth, as of March 31, 1998, the number of shares
of Common Stock previously issued by the Company, the total consideration paid
to the Company and the average price per share paid by the existing shareholders
and new investors, assuming the sale by the Company of shares of
Common Stock offered hereby at an assumed initial public offering price of
$ per share, and before deducting the estimated underwriting discounts and
commissions and estimated offering expenses:

<TABLE>
<CAPTION>
TOTAL
SHARES PURCHASED CONSIDERATION
-------------------- ---------------- AVERAGE PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
---------- ------- ------ ------- -------------
<S> <C> <C> <C> <C> <C>
Existing shareholders(1)........... 15,649,350 % $4,118 % $ --
New investors......................
---------- ----- ------ -----
Total.................... 100.0% $ 100.0%
========== ===== ====== =====
</TABLE>

- ---------------

(1) Sales by the Selling Shareholders will reduce the number of shares held by
existing shareholders to , or % of the total shares of Common
Stock outstanding after the Offering, and will increase the number of shares
held by new investors to shares, or % of the total shares of
Common Stock outstanding after the Offering. Assuming full exercise of the
Underwriters' over-allotment option, the percentage of shares held by
existing shareholders would be % of the total number of shares of
Common Stock to be outstanding after the Offering, and the number of shares
held by new investors would be increased to shares, or % of
the total number of shares of Common Stock to be outstanding after the
Offering. See "Risk Factors -- Dilution," "Management" and "Principal and
Selling Shareholders."

Immediately following completion of the Offering, the Company will have (i)
898,919 shares of Common Stock issuable upon the exercise of outstanding options
granted under the Stock Incentive Plan at a weighted average exercise price of
$10.00 per share; and (ii) 148,354 shares of Common Stock issuable upon the
exercise of non-plan options outstanding at a weighted average exercise price of
$9.10 per share. The exercise of these options will result in further dilution
of new investors in the Offering.

17
<PAGE> 19

SELECTED CONSOLIDATED FINANCIAL DATA

The selected consolidated financial data of the Company set forth below is
qualified in its entirety by, and should be read in conjunction with, the
Consolidated Financial Statements of the Company, including the Notes thereto,
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations" included elsewhere in this Prospectus. The consolidated statement of
income data for the three months ended March 31, 1997 and the three months ended
March 31, 1998 and the consolidated balance sheet data as of March 31, 1998 are
derived from the Company's unaudited consolidated financial statements included
elsewhere in this Prospectus. The consolidated statement of income data for the
years ended December 31, 1995, 1996 and 1997, and the consolidated balance sheet
data as of December 31, 1996 and 1997, are derived from, and are qualified by
reference to, the consolidated financial statements included elsewhere in this
Prospectus, which have been audited by Ernst & Young LLP, independent auditors.
The consolidated balance sheet data as of December 31, 1995 is derived from the
audited consolidated balance sheet not included herein. The consolidated
statements of income data for the years ended December 31, 1993 and 1994, and
the consolidated balance sheet data as of December 31, 1993 and 1994 are derived
from the Company's unaudited consolidated financial statements not included
herein. In the opinion of management, the unaudited consolidated financial
statements have been prepared on a basis consistent with the Consolidated
Financial Statements which appear elsewhere in the Prospectus, and include all
adjustments, consisting only of normal recurring adjustments, necessary for a
fair statement of the financial condition and results of operations of the
Company for the periods presented. Historical results are not necessarily
indicative of results to be expected in the future.

<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
-------------------------------------------------- -----------------
1993 1994 1995 1996 1997 1997 1998
------- ------- -------- -------- -------- ------- -------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF INCOME DATA:
Revenue:
Software license fees................... $ 4,827 $ 7,545 $ 11,199 $ 12,589 $ 14,519 $ 5,185 $ 4,107
Services and maintenance fees........... 2,340 3,576 5,044 7,200 10,342 2,351 3,392
------- ------- -------- -------- -------- ------- -------
Total revenue.................... 7,167 11,121 16,243 19,789 24,861 7,536 7,499
Expenses:
Cost of services and maintenance fees... 1,448 2,083 3,035 5,040 5,995 1,141 1,504
Sales and marketing..................... 2,124 3,283 3,684 4,862 7,469 1,711 2,291
General and administrative.............. 1,309 1,822 4,193 3,562 4,553 853 1,479
Product development..................... 1,171 1,760 2,414 2,587 3,171 678 718
------- ------- -------- -------- -------- ------- -------
Total expenses................... 6,052 8,948 13,326 16,051 21,188 4,383 5,992
------- ------- -------- -------- -------- ------- -------
Income from operations.................... 1,115 2,173 2,917 3,738 3,673 3,153 1,507
------- ------- -------- -------- -------- ------- -------
Interest income, net...................... 33 77 93 98 199 29 60
Other income (expense), net............... 11 59 23 7 (39) -- (53)
Provision for income taxes................ 302 1,060 975 1,582 1,575 1,308 621
------- ------- -------- -------- -------- ------- -------
Net income................................ $ 857 $ 1,249 $ 2,058 $ 2,261 $ 2,258 $ 1,874 $ 893
======= ======= ======== ======== ======== ======= =======
Net income per share -- basic and
diluted................................. $ 0.05 $ 0.08 $ 0.13 $ 0.14 $ 0.14 $ 0.12 $ 0.06
======= ======= ======== ======== ======== ======= =======
Shares used in computing net income per
share -- basic and diluted.............. 15,850 15,555 15,555 15,645 15,649 15,649 15,649
Cash dividends declared per common
share................................... $ -- $ 0.02 $ 0.04 $ 0.02 $ 0.02 $ -- $ --
</TABLE>

<TABLE>
<CAPTION>
AS OF DECEMBER 31, AS OF
----------------------------------------------- MARCH 31,
1993 1994 1995 1996 1997 1998
------- ------- ------- ------- ------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
CONSOLIDATED BALANCE SHEET DATA:
Cash and cash equivalents.......................... $ 1,484 $ 3,134 $ 3,453 $ 4,575 $ 7,318 $ 9,248
Working capital.................................... 629 1,529 2,404 3,911 5,573 6,318
Total assets....................................... 3,203 6,378 10,509 12,980 15,824 16,519
Long-term debt, net of current portion............. -- -- -- -- -- --
Shareholders' equity............................... 949 1,845 3,309 5,090 6,838 7,650
</TABLE>

18
<PAGE> 20

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the Selected
Consolidated Financial Data and the Consolidated Financial Statements and Notes
thereto included elsewhere in this Prospectus. Certain statements in this
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" are forward-looking statements. Such forward-looking statements are
based on current expectations and entail various risks and uncertainties that
could cause actual results to differ materially from those expressed in such
forward-looking statements. For a more detailed discussion of these and other
business risks, see "Risk Factors."

OVERVIEW

E3 is a leading provider of inventory management software solutions
designed to help businesses make purchasing decisions that optimize inventory
levels and increase profitability. The Company's solutions are designed
primarily for businesses at the wholesale and retail segments of the supply
chain. The Company complements its software products with a range of services
that leverage its comprehensive buying process expertise. To date, substantially
all of the Company's revenue has been generated through its direct sales force
based in the United States and abroad. E3 has provided solutions to a broad
range of distributors, wholesalers and retail chains in the general retail;
pharmaceutical; general manufacturing; electrical, industrial and automotive
supply; food and food service; wine and spirits; and office supply industries,
among others. Founded in 1980, E3 has installed its systems at more than 600
customers in 16 countries. Customers include Ace Hardware, Best Buy, CVS
Pharmacy, Eckerd Drugs, Rubbermaid, Staples, The Sports Authority and Victoria's
Secret. In the United States, E3's customers include seven of the largest ten
drug wholesalers, five of the largest ten drug retailers, 22 of the largest 50
food service distributors, and eight of the largest 17 hardware wholesalers.

The Company was originally founded to provide consulting services in the
area of inventory management and introduced its first product, the forerunner to
E3TRIM, in 1984. In 1989, the Company founded the Inventory Management
Institute, Inc. ("IMI") to provide executives and professionals with education
and consulting services. In 1991, the Company introduced E3TRIM to address
replenishment and inventory management needs at the warehouse and distribution
center level. With the introduction of E3TRIM, the Company effectively
transformed its business from primarily a consulting-based company to that of a
software provider. In 1994, the Company introduced E3SLIM to address
replenishment and inventory management needs at the store level, and in 1995,
the Company introduced E3CRISP to provide a store-level replenishment and
inventory management system for manufacturers who offer inventory management
services to their customers. In 1997, the Company introduced ProfitTrack, an
Internet-based replenishment and inventory management system with functionality
similar to E3SLIM. Currently, the Company derives its revenue from the licensing
of its inventory management software and associated services. License revenue
consists primarily of sales of E3TRIM, E3SLIM and E3CRISP. In 1997, the Company
derived approximately 70% of its revenue from license fees and services
associated with E3TRIM. The Company's services revenue consists of maintenance
services, consulting, training and educational programs.

The Company licenses its software and provides maintenance under the terms
of a software license agreement. Accordingly, the Company recognizes license fee
revenue upon shipment of the software, and maintenance fee revenue is recognized
ratably over the term of the license. Typically, the Company's software license
agreements do not provide for any post-delivery obligations to be fulfilled by
the Company. Consulting, implementation and educational services are priced
separately and currently are provided under the terms of a separate agreement.
Revenue from consulting, implementation and educational services is recognized
at the time the services are provided. Through December 31, 1997, the Company
recognized revenue in accordance with AICPA Statement of Position 91-1.
Effective January 1, 1998, the Company has recognized revenue in accordance with
the provisions of the AICPA Statement of Position 97-2.

The Company's pricing model for its software licenses is value-based and,
in determining the initial license fee, takes into account factors such as: (i)
the customer's anticipated return on its investment in the product; and (ii) the
customer's vertical market, number of locations, dollar amount of inventory and
number

19
<PAGE> 21

of SKUs. In addition, all customers who license the Company's software are
required to pay an annual software maintenance fee typically equal to 15% of the
initial license fee and payable on a monthly basis. All customers are required
to pay this maintenance fee for as long as they continue to use the software.
All other service offerings are priced separately either by the day, event or
customer deliverable.

The Company's total revenue has increased every year since its inception.
As a percentage of total revenue, services and maintenance fees revenue
increased to 41.6% in 1997 from 36.4% in 1996. This primarily was due to a 49.7%
increase in recurring software maintenance fees and a 37.0% increase in other
services revenue, resulting primarily from the Company's recent focus on
increasing services revenue. Cost of revenue associated with the Company's
software revenue is immaterial and product development is treated as an
operating expense of the Company. Accordingly, the margins associated with
software license fee revenue are significantly higher than for services and
maintenance fees revenue. Although the mix between software license fee revenue
and services and maintenance fees revenue may change in the future depending
upon a number of factors, including the Company's planned continued expansion of
its services offerings, the Company believes that license fees will continue to
constitute the majority of its revenue for the foreseeable future.

In 1997, approximately 30% of the Company's total revenue was generated
from its international operations and the Company intends to continue to expand
its international operations. Accordingly, the percentage of international
revenue to total revenue may change in future periods depending upon a number of
factors, including the economic and political climate of the countries in which
the Company does business. The Company has experienced, and expects to continue
to experience, a high degree of seasonality with a disproportionate amount of
revenue and earnings being recognized in the first and fourth quarters. The
Company has in the past had a disproportionately low amount of its annual
revenue and earnings during its third quarter due, in large part, to the general
decline in business activity in Europe during the summer months. Because revenue
is typically greater in the fourth quarter, any shortfall from anticipated
fourth quarter revenue, particularly license fees, would have a
disproportionately large adverse effect on the Company's operating results for
the year.

The Company distributes its products and services primarily through its
direct sales force, although it plans to broaden its distribution channels in
the future. Currently, the Company has a presence, either through offices or
personnel, in ten countries, with seven offices and 55 personnel located in
these countries. The first international offices were established in Sweden and
Germany in 1991, and the Company has added offices in France, Italy, Norway and
the United Kingdom and also maintains a presence in Australia, the Netherlands
and Spain. The Company's international distribution strategy entails control by
the Company, through its wholly-owned subsidiaries, of the distribution for its
products rather than the use of third-party distributors. Sales to customers
located in Europe are generated through the Company's European offices and are
included in international revenues. Sales to customers located in Australia,
Canada and Latin America are generated through the Company's domestic operations
and are included in domestic revenues.

20
<PAGE> 22

RESULTS OF OPERATIONS

The following table sets forth certain operating data as a percentage of
total revenue for the periods indicated:

<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
------------------------ -------------
1995 1996 1997 1997 1998
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF INCOME DATA:
Revenue:
Software license fees....................... 68.9% 63.6% 58.4% 68.8% 54.8%
Services and maintenance fees............... 31.1 36.4 41.6 31.2 45.2
----- ----- ----- ----- -----
Total revenue....................... 100.0 100.0 100.0 100.0 100.0
Expenses:
Cost of services and maintenance fees....... 18.7 25.5 24.1 15.1 20.0
Sales and marketing......................... 22.7 24.6 30.0 22.7 30.6
General and administrative.................. 25.8 18.0 18.3 11.3 19.7
Product development......................... 14.9 13.1 12.8 9.0 9.6
----- ----- ----- ----- -----
Total expenses...................... 82.1 81.2 85.2 58.1 79.9
----- ----- ----- ----- -----
Income from operations........................ 17.9 18.8 14.8 41.9 20.1
----- ----- ----- ----- -----
Interest income, net.......................... 0.6 0.5 0.8 0.4 0.8
Other income (expense), net................... 0.1 0.0 (0.2) -- (0.7)
Provision for income taxes.................... 6.0 8.0 6.3 17.4 8.3
----- ----- ----- ----- -----
Net income.................................... 12.6% 11.3% 9.1% 24.9% 11.9%
===== ===== ===== ===== =====
</TABLE>

THREE MONTHS ENDED MARCH 31, 1998 COMPARED TO THREE MONTHS ENDED MARCH 31, 1997

REVENUE

Total revenue for the three months ended March 31, 1998 and the three
months ended March 31, 1997 was $7.5 million. Total revenue consists of software
license fees revenue and services and maintenance fees revenue. The Company's
international operations represented 22.7% and 25.9% of total revenue in the
three months ended March 31, 1998 and the three months ended March 31, 1997,
respectively.

Software license fee revenue was $4.1 million in the three months ended
March 31, 1998 as compared to $5.2 million in the three months ended March 31,
1997, representing a 20.8% decrease. Software license fee revenue consists of
revenue from the sale of the Company's software products. As a percentage of
total revenue, software license fee revenue was 54.8% of total revenue in the
first quarter of 1998 as compared to 68.8% of total revenue in the first quarter
of 1997. Software license fee revenue decreased primarily due to the Company
having a relatively higher license fee backlog at December 31, 1996 and a
substantial portion of such backlog not being recognized as revenue until the
first quarter of 1997. Conversely, the Company recognized a greater portion of
revenue during the fourth quarter of 1997, which reduced the amount of backlog
available for recognition in the first quarter of 1998.

Services and maintenance fees revenue consists of revenue from consulting,
implementation, customer education and recurring software maintenance fees, all
of which are associated with the licensing of the Company's software products.
Services and maintenance fees revenue increased 44.3% to $3.4 million in the
three months ended March 31, 1998 from $2.4 million in the three months ended
March 31, 1997. This increase in revenue resulted primarily from the Company's
level of service activity and a focused effort to increase billing for services.
As a percentage of total revenue, services and maintenance fees revenue
increased to 45.2% of total revenue in the first quarter of 1998 from 31.2% of
total revenue in the first quarter of 1997. Services and maintenance fees
revenue is primarily dependent upon the Company's ability to generate new
software licenses and is further affected by the size of such implementation
efforts and the rates charged for initial license fees and services rendered.
Recurring software maintenance revenue was $1.8 million in the first

21
<PAGE> 23

quarter of 1998 as compared to $1.3 million in the first quarter of 1997,
representing a 32.9% increase. Currently, all customers licensing software from
the Company are required to pay software maintenance fees for as long as they
use the software.

COST OF REVENUE

The Company's cost of license fees consists of the cost of printing the
software documentation and the tangible media used to deliver the software.
Accordingly, the cost of license fee revenue is not material. Cost of services
and maintenance fees revenue was $1.5 million in the first quarter of 1998 as
compared to $1.1 million in the first quarter of 1997, representing a 31.8%
increase. The Company's cost of services and maintenance fees revenue includes
the cost of personnel and related facility and equipment costs incurred in
providing consulting, implementation, customer education and software
maintenance and support to its customers. As a percentage of related services
and maintenance fees revenue, such costs represented 44.3% of the related
revenue in the first quarter of 1998 and 48.5% of the related revenue in the
comparable period in 1997, representing a 4.2% decrease. The resulting improved
margins principally were due to continued growth in recurring maintenance fees,
which have a disproportionately lower cost than that of implementation,
consulting and educational services.

SALES AND MARKETING

Sales and marketing expenses were $2.3 million in the three months ended
March 31, 1998 as compared to $1.7 million in the three months ended March 31,
1997, representing a 33.9% increase. Sales and marketing expenses include
personnel costs, sales commissions, facilities-related costs, travel,
promotional events such as trade shows and conferences, advertising and public
relations programs. The increase in sales and marketing expenses during the
first quarter of 1998 as compared to the first quarter of 1997 primarily was due
to an increase in marketing and direct sales personnel, including the
establishment of a full-time telemarketing staff and the expansion of a
comprehensive advertising and public relations program designed to increase the
Company's exposure in the marketplace. Expansion of the Company's sales and
marketing resources is intended to position the Company for planned growth. The
Company believes that the dollar amount of sales and marketing expenses will
continue to increase, but is not expected to vary significantly as a percentage
of total revenue as compared to the fiscal year 1997.

GENERAL AND ADMINISTRATIVE

General and administrative expenses were $1.5 million in the three months
ended March 31, 1998 as compared to $853,000 in the three months ended March 31,
1997, representing a 73.4% increase. General and administrative expenses include
the personnel and other costs associated with the administrative, finance, human
resource, internal systems, professional fees and executive departments of the
Company. The increase in general and administrative expenses during the quarter
ended March 31, 1998 as compared to the same quarter of 1997 was principally
related to the increase in personnel and personnel-related costs associated with
the growth of the Company's business and increased legal and accounting
expenses.

PRODUCT DEVELOPMENT

Product development expenses were $718,000 in the three months ended March
31, 1998 as compared to $678,000 in the three months ended March 31, 1997,
representing a 5.9% increase. Product development expenses include the
personnel, personnel-related costs and development tools associated with the
research, development, testing and documentation of the Company's software
product research and development efforts, certain of which efforts have resulted
in software products that have been marketed by the Company. The Company expects
product development costs to increase as the Company continues to invest in
developing new and improved software products; however, as a percentage of total
revenue, such costs are not expected to vary significantly as compared to the
fiscal year 1997.

In accordance with Statement of Financial Accounting Standards No. 86,
software development costs are expensed as incurred until technological
feasibility has been established, at which time such costs are

22
<PAGE> 24

capitalized until the product is available for general release. To date, the
establishment of technological feasibility and the general release of the
Company's software products have generally coincided. Accordingly, software
development costs qualifying for capitalization were insignificant, and
therefore, not capitalized.

PROVISION FOR INCOME TAXES

The Company recorded income tax expense of $621,000 for the first quarter
of 1998 as compared to $1.3 million in the first quarter of 1997, representing
no change in the Company's effective tax rate of approximately 41%. The
Company's overall effective tax rate is generally higher than that of its
domestic operations principally due to higher tax rates being imposed on certain
of its foreign operations and the non-deductibility of certain domestic
expenses. The Company anticipates that its effective tax rate will continue to
be higher than that of a comparable domestic operation as a result of the tax
rates imposed by certain foreign tax authorities.

YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996

REVENUE

Total revenue increased to $24.9 million in 1997 from $19.8 million in
1996, representing a 25.6% increase. Total revenue increased primarily due to
continued growth in the number and size of software licenses entered into and
implemented and due to increased recurring maintenance fees and other services
revenue. The Company's international operations represented approximately 30%
and approximately 35% of total revenue in 1997 and 1996, respectively.

Software license fee revenue increased to $14.5 million in 1997 from $12.6
million in 1996, representing a 15.3% increase. Software license fee revenue
increased primarily due to increases in the amount and size of the Company's
domestic software licensing activities. As a percentage of total revenue,
software license fee revenue decreased to 58.4% in 1997 from 63.6% in 1996.

Services and maintenance fees revenue increased to $10.3 million in 1997
from $7.2 million in 1996, representing a 43.6% increase. This increase resulted
primarily from increased service activities related to the overall increase in
the number of customers and the Company's focus on increasing its services
revenue. Recurring maintenance fees also contributed to the increase in services
and maintenance fees revenue, increasing to $5.6 million in 1997 from $3.8
million in 1996, representing a 49.7% increase. Increased recurring maintenance
fees resulted from an increase in customer license installations in 1997. As a
percentage of total revenue, services and maintenance fees revenue increased to
41.6% of total revenue in 1997 from 36.4% in 1996.

COST OF REVENUE

Cost of revenue, which consists almost entirely of cost of services and
maintenance fees revenue, increased to $6.0 million in 1997 from $5.0 million in
1996, representing an 18.9% increase. As a percentage of related services and
maintenance fees revenue, such costs represented 58.0% of services and
maintenance fees revenue in 1997, decreasing from 70.0% in 1996. The resulting
improvement in margins was due principally to continued growth in revenue from
the Company's recurring software maintenance fees, which have a
disproportionately lower cost than that associated with implementation,
consulting and educational services.

SALES AND MARKETING

Sales and marketing expenses increased to $7.5 million in 1997 from $4.9
million in 1996, representing a 53.6% increase. Sales and marketing expenses
represented 30.0% of total revenue in 1997 and 24.6% in 1996. The increase in
sales and marketing expenses was primarily due to an increase in the number of
marketing and direct sales personnel from 15 as of December 31, 1996 to 33 as of
December 31, 1997, including the establishment of five full-time telemarketing
positions and the continuation of a comprehensive advertising and public
relations program designed to increase the Company's exposure in the
marketplace.

23
<PAGE> 25

GENERAL AND ADMINISTRATIVE

General and administrative expenses increased to $4.6 million in 1997 from
$3.6 million in 1996, representing a 27.8% increase. General and administrative
expenses represented approximately 18% of total revenue in both 1997 and 1996.
The increase in general and administrative expenses during 1997 was principally
related to management incentive compensation earned in 1997 of approximately
$700,000 and an increase in personnel and personnel-related costs associated
with the growth of the Company's business.

PRODUCT DEVELOPMENT

Product development expenses increased to $3.2 million in 1997 from $2.6
million in 1996, representing a 22.6% increase. The Company's product
development expenses represented approximately 13% of total revenue in each such
year. The increase in product development expenses during 1997 was principally
related to increased personnel and personnel-related costs associated with the
Company's continuing efforts to improve and expand its software product
offerings.

PROVISION FOR INCOME TAXES

The Company recorded income tax expense of approximately $1.6 million for
each of 1997 and 1996, which represented an effective tax rate of 41% in each
year. The Company's overall effective tax rate is generally higher than that of
its domestic operations principally due to higher tax rates being imposed on
certain of its foreign operations and the non-deductibility of certain domestic
expenses. The Company anticipates that its effective tax rate will continue to
be higher than that of a comparable domestic operation.

YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995

REVENUE

Total revenue increased to $19.8 million in 1996 from $16.2 million in
1995, representing a 21.8% increase. Total revenue increased primarily due to
growth in the number and size of software licenses. The Company's international
operations represented approximately 35% and approximately 27% of total revenue
in 1996 and 1995, respectively.

Software license fee revenue increased to $12.6 million in 1996 from $11.2
million in 1995, representing a 12.4% increase, primarily due to growth in the
Company's international operations. As a percentage of total revenue, software
license fee revenue decreased to 63.6% of total revenue in 1996 from 68.9% of
total revenue in 1995.

Services and maintenance fees revenue increased to $7.2 million in 1996
from $5.0 million in 1995, representing a 42.7% increase. Revenue from
consulting and implementation services increased to $3.4 million from $2.8
million, a 21.4% increase, while recurring software maintenance fees increased
to $3.8 million in 1996 from $2.2 million in 1995, representing a 67.5%
increase, which resulted primarily from the increase in the total number of
customers. As a percentage of total revenue, services and maintenance fees
revenue increased to 36.4% of total revenue in 1996 from 31.1% of total revenue
in 1995.

COST OF REVENUE

Cost of services and maintenance fee revenue increased to $5.0 million in
1996 from $3.0 million in 1995, representing a 66.1% increase. As a percentage
of related services and maintenance fees revenue, such costs represented 70.0%
of services and maintenance fees revenue in 1996 and 60.2% in 1995. The
decreased margin was generally related to the Company's hiring of additional
consulting and implementation personnel as part of the Company's planned growth
strategy.

SALES AND MARKETING

Sales and marketing expenses increased to $4.9 million in 1996 from $3.7
million in 1995, representing a 32.0% increase. The increase in sales and
marketing expenses was primarily due to an increase in marketing and

24
<PAGE> 26

direct sales personnel and the initiation of a comprehensive advertising and
public relations program designed to increase the Company's exposure in the
marketplace.

GENERAL AND ADMINISTRATIVE

General and administrative expenses decreased to $3.6 million in 1996 from
$4.2 million in 1995, representing a 15.0% decrease. The decrease in general and
administrative expenses during 1996 was principally related to management
incentives earned in 1995 that were not offered in 1996, offset to some extent
by modest increases in other general and administrative expenses. As a
percentage of total revenue, general and administrative expenses decreased to
18.0% of revenue in 1996 from 25.8% in 1995.

PRODUCT DEVELOPMENT

Product development expenses increased to $2.6 million in 1996 from $2.4
million in 1995, representing an 7.2% increase. The Company's product
development expenses represented 13.1% and 14.9% of total revenue in 1996 and
1995, respectively. The increase in product development expenses during 1996 was
due to increased personnel and personnel-related costs associated with the
Company's continuing efforts to improve and expand its software product
offerings.

PROVISION FOR INCOME TAXES

The Company recorded income tax expense of $1.6 million for 1996 and
$975,000 for 1995. The increase in income tax expense was the result of
increased earnings and an increase in the Company's effective tax rate to 41.2%
in 1996 from 32.1% in 1995. The Company's effective tax rate for 1996 was
substantially higher than 1995 primarily due to the Company recognizing the
benefit of foreign net operating loss carryforwards during 1995 and, to a lesser
extent, from the non-deductibility of certain domestic expenses and higher
effective tax rates in certain foreign countries.

25
<PAGE> 27

QUARTERLY RESULTS OF OPERATIONS

The following table presents certain unaudited quarterly statements of
income data for each of the Company's last nine fiscal quarters, as well as the
percentage of the Company's total revenue represented by each item. The
information has been derived from the Company's unaudited Consolidated Financial
Statements. The unaudited Consolidated Financial Statements have been prepared
on substantially the same basis as the audited Consolidated Financial Statements
contained herein and all adjustments, consisting only of normal recurring
adjustments, that the Company considers to be necessary to present fairly this
information when read in conjunction with the Company's Consolidated Financial
Statements and Notes thereto appearing elsewhere herein. The results of
operations for any quarter are not necessarily indicative of the results to be
expected for any future period.

<TABLE>
<CAPTION>
THREE MONTHS ENDED
--------------------------------------------------------------------------------------------------
MAR. 31, JUNE 30, SEPT. 30, DEC. 31, MAR. 31, JUNE 30, SEPT. 30, DEC. 31, MAR. 31,
1996 1996 1996 1996 1997 1997 1997 1997 1998
-------- -------- --------- -------- -------- -------- --------- -------- --------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue:
Software license fees...... $ 3,501 $ 3,261 $ 1,939 $ 3,888 $ 5,185 $ 2,533 $ 2,193 $ 4,608 $ 4,107
Services and maintenance
fees..................... 1,608 1,769 1,715 2,108 2,351 2,439 2,603 2,949 3,392
------- ------- ------- ------- ------- ------- ------- ------- -------
Total revenue........ 5,109 5,030 3,654 5,996 7,536 4,972 4,796 7,557 7,499
Expenses:
Cost of services and
maintenance fees......... 1,029 1,125 1,147 1,739 1,141 1,268 1,522 2,065 1,504
Sales and marketing........ 993 1,137 1,102 1,630 1,711 1,694 1,706 2,358 2,291
General and
administrative........... 609 785 792 1,376 853 698 898 2,104 1,479
Product development........ 534 589 583 881 678 677 829 987 718
------- ------- ------- ------- ------- ------- ------- ------- -------
Total expenses....... 3,165 3,636 3,624 5,626 4,383 4,337 4,955 7,514 5,992
------- ------- ------- ------- ------- ------- ------- ------- -------
Income (loss) from
operations................. 1,944 1,394 30 370 3,153 635 (159) 43 1,507
------- ------- ------- ------- ------- ------- ------- ------- -------
Interest income, net......... 17 18 26 37 29 45 53 74 60
Other income (expense),
net........................ 2 -- -- 5 -- -- -- (40) (53)
Provision for (benefit from)
income taxes............... 808 582 23 169 1,308 279 (44) 32 621
------- ------- ------- ------- ------- ------- ------- ------- -------
Net income (loss)............ $ 1,155 $ 830 $ 33 $ 243 $ 1,874 $ 401 $ (62) $ 45 $ 893
======= ======= ======= ======= ======= ======= ======= ======= =======
Net income (loss) per
share -- basic and
diluted.................... $ 0.07 $ 0.05 $ -- $ 0.02 $ 0.12 $ 0.03 $ -- $ -- $ 0.06
======= ======= ======= ======= ======= ======= ======= ======= =======
</TABLE>

<TABLE>
<CAPTION>
THREE MONTHS ENDED
--------------------------------------------------------------------------------------------------
MAR. 31, JUNE 30, SEPT. 30, DEC. 31, MAR. 31, JUNE 30, SEPT. 30, DEC. 31, MAR. 31,
1996 1996 1996 1996 1997 1997 1997 1997 1998
-------- -------- --------- -------- -------- -------- --------- -------- --------
(AS A PERCENTAGE OF TOTAL REVENUE)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue:
Software license fees...... 68.5% 64.8% 53.1% 64.8% 68.8% 50.9% 45.7% 61.0% 54.8%
Services and maintenance
fees..................... 31.5 35.2 46.9 35.2 31.2 49.1 54.3 39.0 45.2
------- ----- ----- ----- ----- ----- ----- ----- -----
Total revenue........ 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Expenses:
Cost of services and
maintenance fees......... 20.1 22.4 31.4 29.0 15.1 25.5 31.7 27.3 20.0
Sales and marketing........ 19.4 22.6 30.2 27.2 22.7 34.1 35.6 31.2 30.6
General and
administrative........... 11.9 15.6 21.7 23.0 11.3 14.0 18.7 27.8 19.7
Product development........ 10.5 11.7 16.0 14.7 9.0 13.6 17.3 13.1 9.6
------- ----- ----- ----- ----- ----- ----- ----- -----
Total expenses....... 61.9 72.3 99.2 93.9 58.1 87.2 103.3 99.4 79.9
------- ----- ----- ----- ----- ----- ----- ----- -----
Income (loss) from
operations................. 38.1 27.7 0.8 6.1 41.9 12.8 (3.3) 0.6 20.1
------- ----- ----- ----- ----- ----- ----- ----- -----
Interest income, net......... 0.4 0.4 0.7 0.6 0.4 0.9 1.1 1.0 0.8
Other income (expense),
net........................ -- -- -- 0.1 -- -- -- (0.5) (0.7)
Provision for (benefit from)
income taxes............... 15.8 11.6 0.6 2.8 17.4 5.6 (0.9) 0.4 8.3
------- ----- ----- ----- ----- ----- ----- ----- -----
Net income (loss)............ 22.7% 16.5% 0.9% 4.0% 24.9% 8.1% (1.3)% 0.7% 11.9%
======= ===== ===== ===== ===== ===== ===== ===== =====
</TABLE>

The Company's operations, revenue and operating results have varied in the
past, and are expected to vary in the future, substantially from quarter to
quarter. Among the factors causing these potential variations are fluctuations
in the demand for the Company's products, the level of product and price
competition in the Company's markets, the length of the Company's sales cycle,
the size and timing of individual transactions, the mix of products and services
sold, delays in or cancellations of customer implementations, the timing of new
product introductions and enhancements by the Company or its competitors, the
Company's ability to

26
<PAGE> 28

attract and retain key technical, sales and managerial personnel, the ratio of
international to domestic sales, commercial strategies adopted by competitors,
changes in foreign currency exchange rates, customers' budget constraints, the
Company's ability to control costs and general economic conditions. In addition,
the Company has in the past, and may in the future, provide a customer with a
right to receive a full refund of the license fees paid if such customer is
dissatisfied with the Company's product in the period following installation
(typically up to 90 days). The grant of such a right may have the effect of
delaying the Company's recognition of revenue from such license fee. In
addition, in each year in which the Company paid bonuses to certain executive
officers, such bonuses were based on year-end operating results and were paid in
the fourth quarter, which has resulted in substantially increased general and
administrative expenses for such periods. As a result of the foregoing factors,
comparisons of future operating results with prior periods should not be relied
upon as indicators of actual performance in such periods. The Company
establishes its expenditure levels for consulting, product development, sales
and marketing and other operating expenses based, in large part, on its expected
future revenue. Furthermore, since software license sales are typically
accompanied by a significant amount of consulting, implementation and support
services, the Company's consulting and support resources must be managed to meet
anticipated software license fee revenue. As a result, any unexpected decline in
software license fee revenue is likely to adversely and disproportionately
affect operating results and net income because only a small portion of the
Company's expenses vary with its revenue. Based upon all of the foregoing, the
Company believes that its quarterly and annual revenue, expenses and operating
results are likely to vary significantly in the future and that period-to-period
comparisons of its operating results are not necessarily meaningful. As a
result, the Company's operating results for any particular quarter may be below
the expectations of securities analysts and investors, which could materially
and adversely affect the market price of the Company's Common Stock.

The Company's quarterly operating results are also subject to certain
seasonal fluctuations. The Company's revenue, particularly its software license
fee revenue, and operating results are typically strongest in the first and
fourth quarter and weakest in the third quarter. The Company's revenue and
operating results for the first quarter typically benefit from customers making
corporate IT purchasing decisions early in the budget year. The Company's
revenue and operating results for the fourth quarter typically benefit from the
efforts of the Company's sales force to meet year-end sales quotas and the
tendency for IT departments to spend the remaining portion of IT budgets prior
to year-end. The Company experiences lower sales levels in the third quarter,
due in large part to the general decline in business activity in Europe during
the summer months. See "Risk Factors -- Potential Variability of Quarterly
Operating Results and Seasonality."

LIQUIDITY AND CAPITAL RESOURCES

Since inception, the Company has funded its operations using cash generated
entirely from operations. Cash provided from operations during the three months
ended March 31, 1998 and the years ended December 31, 1997 and 1996 was $2.2,
$3.8 and $2.0 million, respectively. The cash generated from operations in these
periods was used principally to provide working capital to support the Company's
operations. The Company also utilized cash to purchase furniture and equipment
during the three months ended March 31, 1998 and the years ended December 31,
1997 and 1996 of approximately $149,000, $635,000 and $612,000, respectively. In
addition, the Company paid dividends to its shareholders of approximately
$77,000, $300,000 and $300,000 during the three months ended March 31, 1998 and
the years ended December 31, 1997 and 1996, respectively. As a result of the
Company's continued profitable operations, cash reserves increased to $9.2
million as of March 31, 1998 from $7.3 million at December 31, 1997. The Company
does not have a debt facility. The Company believes that its existing liquidity
and capital resources, including the proceeds resulting from the sale of its
Common Stock in the Offering, together with cash generated from operations
during 1998, will be sufficient to satisfy its cash requirements for the next
twelve months. To the extent that such amounts are insufficient, the Company
will be required to raise additional funds through equity or debt financing.
There can be no assurance that the Company will be able to raise these
additional funds on terms acceptable to the Company, or at all.

27
<PAGE> 29

NEW ACCOUNTING PRONOUNCEMENTS

In June 1997, the Financial Accounting Standards Board issued Statement No.
130 ("SFAS No. 130"), "Reporting Comprehensive Income." SFAS No. 130 is designed
to improve the reporting of changes in equity from period to period. The Company
adopted SFAS No. 130, as applicable, effective for the quarter ended March 31,
1998. In June 1997, the Financial Accounting Standards Board issued Statement
No. 131 ("SFAS No. 131"), "Disclosures About Segments of an Enterprise and
Related Information." SFAS No. 131 requires that an enterprise disclose certain
information about operating segments. The Company intends to adopt SFAS No. 131
for its annual reporting period ending December 31, 1998. In October 1997, the
American Institute of Certified Public Accountants issued Statement of Position
97-2 ("SOP 97-2"), "Software Revenue Recognition." SOP 97-2 supersedes SOP 91-1,
and is effective for the Company beginning after December 15, 1997. The Company
adopted SOP 97-2 as required for transactions entered into beginning January 1,
1998.

The Company's management does not believe that the adoption of these
pronouncements has had or will have a material impact on the Company's financial
position or results of operations.

28
<PAGE> 30

BUSINESS

OVERVIEW

E3 is a leading provider of inventory management software solutions
designed to help businesses make purchasing decisions that optimize inventory
levels to maximize profitability and that are aimed predominantly at the
wholesale and retail segments of the supply chain. The Company complements its
software products with a range of services that leverage its comprehensive
buying process expertise. To date, substantially all of the Company's revenue
has been generated through its direct sales force based in the United States and
abroad. E3 has provided solutions to a broad range of distributors, wholesalers
and retail chains in the general retail; pharmaceutical; general manufacturing;
electrical, industrial and automotive supply; food and food service; wine and
spirits; and office supply, among others. Founded in 1980, E3 has installed its
systems at more than 600 customers in 16 countries. Customers include Ace
Hardware, Best Buy, CVS Pharmacy, Eckerd Drugs, Rubbermaid, Staples, The Sports
Authority and Victoria's Secret. In the United States, E3's customers include
seven of the largest ten drug wholesalers, five of the largest ten drug
retailers, 22 of the largest 50 food service distributors, and eight of the
largest 17 hardware wholesalers.

INDUSTRY BACKGROUND

The Need for Inventory Management

Today's increasingly competitive business environment has forced
manufacturers, distributors and retailers to change their business practices. In
the past, manufacturers were often able to dictate the flow of goods to market,
moderating how and when they produced goods in order to increase the efficiency
of their operations. Recently, however, there has been a fundamental shift in
market power from manufacturers to retailers and consumers. This shift has
resulted from the convergence of a number of trends, including the rapid
proliferation of product offerings, shorter product life cycles, the emergence
of more informed consumers demanding higher service levels, wider product
assortment with greater availability, and the evolution of the retail industry
from local stores to large national and regional chains. These trends have had a
profound effect on the supply chain, which consists of the flow of goods from
suppliers to manufacturers, then to wholesalers and warehouses, next to
distributors and retailers, and ultimately, to the consumer. The competitive
nature of today's end markets requires retailers and wholesalers to effectively
manage their supply chains in order to provide their customers with the right
products, at the right price, and at the precise time and place they are needed.

In today's volatile, customer-driven markets, businesses must reengineer
their supply chain processes to improve customer service and maximize
profitability. In particular, many retailers and wholesalers need to manage
their inventories more profitably in order to remain competitive. Inventory is
typically the largest asset on retailers' balance sheets and generally
represents over 70% of the assets in a distribution business. A business'
ability to manage the timing, cost and selection of its inventory assets has an
enormous impact on its profitability. As customers demand higher service levels
and greater responsiveness from retailers, purchasing and inventory
replenishment is increasingly becoming a core investment activity for
businesses. Poor inventory management places businesses at a competitive
disadvantage. Out-of-stock products result in lost sales, while excess inventory
levels increase operating costs and limit the ability of businesses to respond
to changing market demands. As a result of the need to optimally manage
inventory, businesses have increasingly turned to IT solutions to help them
achieve this objective.

A number of recent developments has further accelerated demand for
inventory management systems. Greater competitiveness among retailers has led to
significantly higher spending levels in their IT budgets. In addition, computing
power and database management technology have advanced sufficiently to permit
sophisticated analysis to be performed cost-effectively on large amounts of
data. Moreover, the proliferation of distributed public and private networks,
such as the Internet, has enabled organizations to easily and cost-effectively
link their IT environments with customers, suppliers and business partners.

29
<PAGE> 31

Inventory Management Challenges

Historically, retailers and distributors have lacked sufficient solutions
to optimally manage their inventories. The available options for inventory
management have included ERP systems, supply chain management ("SCM") software,
internal legacy systems and first generation inventory management software. ERP
systems traditionally have focused on controlling inventory levels, rather than
on optimally managing inventory and, as a result, generally do not possess the
forecasting, planning and scheduling functionality necessary to optimize
inventory management. The demand for SCM software initially came from
manufacturers. Consequently, most providers of SCM software have developed
products to address the needs of manufacturers, without focusing on the
particular needs of distributors, wholesalers and retailers. Legacy systems and
first generation inventory management software do not possess decision-support,
automation and "what-if" analysis capabilities. While legacy and first
generation systems may increase inventory turns, they generally do not optimize
inventory levels or maximize profitability and typically do not enable companies
to take advantage of special supplier discounts and promotions, forward-buying
opportunities, and economic buying cycles. Gartner Group estimates that the vast
majority of these legacy systems will need to be replaced by next-generation
inventory management systems.

As a result of these recent trends, a significant need has developed for
optimized inventory management solutions that: (i) not only track inventory
levels but also measure and improve inventory profitability; (ii) provide
sophisticated decision-support tools combined with simulation capabilities that
analyze numerous purchasing factors, such as demand patterns, purchasing costs,
the receipt and management of inventory, vendor pricing and discounts, and
forecasted demand; (iii) respond to changing business factors by automatically
recommending the optimal purchasing decisions; and (iv) enable companies to
manage millions of SKUs over broad geographic regions with many stores and
distributed users. Finally, the solutions should be easy to implement, use and
maintain.

E3 SOLUTIONS

E3 is a leading provider of inventory management software solutions
designed to help businesses make purchasing decisions that optimize inventory
levels and increase profitability. The Company's solutions are designed
primarily for businesses in the wholesale and retail levels of the supply chain.
The solutions address the complex requirements of inventory management by
factoring in forward-buying and alternate-buying opportunities, while minimizing
the required inventory levels needed to meet pre-established customer service
objectives. The Company's solutions are based on a comprehensive suite of
software modules, including demand forecasting, lead time forecasting, order
policy analysis, service level analysis, replenishment analysis, investment
analysis and order validity analysis. The Company complements its software
products with consulting and educational services that help customers maximize
profitability through the use of the Company's proprietary inventory management
software and techniques. Key features and benefits of the Company's solutions
include the following:

Advanced Decision-Making Capabilities. The Company's solutions employ
sophisticated inventory management techniques, such as forward buying,
scientific demand forecasting and economic analysis, to determine optimal
inventory levels. Advanced simulation capabilities allow the end-user to
perform "what-if" analyses to determine the impact of various purchasing
decisions on the bottom line. In addition, the end-user can factor in
certain external variables such as seasonality, pricing changes, competing
promotions, store locations and customer demographics to optimize inventory
management decisions, including inventory purchasing, allocation and
disbursement. These solutions are designed to simplify complex purchasing
and inventory management decisions in order to maximize profitability.

Automated Purchasing Process. The Company's solutions automatically
generate recommended order quantities that take into account lead times,
lead time variability, order cycles, demand forecasts, seasonality, vendor
price brackets and costs of acquiring and carrying inventory. By automating
routine order cycles and prompting users when purchasing should take place,
the Company's solutions permit buyers to work on more profit-oriented
activities such as trend analysis, supplier negotiation, product mix
review, inventory exception management and market research. With the
purchasing process more

30
<PAGE> 32

automated, buyers can allocate more time to the management of a greater
number of products and vendor relationships, which can further reduce costs
and bolster revenue.

Optimized Service Levels. The Company's solutions are designed to
reduce lost sales and improve customer service by minimizing out-of-stock
inventory, balancing inventory to deliver more consistent order fill rates
and enhancing an organization's ability to respond to rapidly changing
customer demands. The Company's solutions allow users to perform
sensitivity analyses on various service levels to determine the most
appropriate service level based on the resulting impact on profitability.
This enables users to maximize profitability by balancing the revenue
potential and carrying costs associated with the inventory needed to
maintain pre-established service levels.

Complementary Service Offerings. The Company believes that successful
inventory management involves more than just software solutions and the
mechanization of manual procedures. A core understanding of the principles
of inventory management is also important for realizing the maximum benefit
from the Company's solutions. As a result, the Company offers a series of
consulting and educational services that are designed to complement its
product offerings by training end users in "best-practices" for inventory
management. The Company has established an educational institution, the
Inventory Management Institute ("IMI"), that focuses on studying and
developing advanced techniques for inventory management, and communicating
these findings to its end-users through course work and seminars.

Rapid Implementation and Return on Investment. E3's products can be
implemented within a few months and are designed to integrate easily with
existing enterprise systems with minimal disruption to customers' existing
IT environments. The Company's software has been designed in a modular
manner, thereby allowing customers to purchase only their desired functions
and add more modules as their needs evolve and expand. In addition, E3's
products feature highly intuitive and easy-to-use graphical interfaces and
user screens, enabling users to rapidly and efficiently perform purchasing
activities with minimal training. Because customers typically are able to
rapidly implement the Company's software and to quickly affect overall
profitability, the Company believes that its customers are able to obtain
rapid payback and significant return on investment within a few months of
implementation.

STRATEGY

Maintain and Enhance Technology Leadership. The Company seeks to
maintain its leadership position by continuing to provide innovative
inventory management solutions that encompass leading-edge technology,
proprietary methodologies and comprehensive services and education. The
Company believes that its knowledge and expertise in inventory management
systems aimed at optimizing profitability provides a significant
competitive advantage. The Company will seek to continue to enhance the
functionality of its existing products, introduce new products to meet
emerging market needs and expand the breadth of its services offerings.

Expand Product Offerings and Target New Market Opportunities. The
Company intends to leverage its significant experience in inventory
management and its expertise in advanced software technology to expand the
scope of its products to address the smaller retail markets as well as the
market needs of very large retail chains. In early 1998, the Company
introduced ProfitTrack, an Internet-based service that provides outsourced
inventory management for independent vendors and small retail chains. In
addition, E3 intends to develop industry-specific functionality and
features to address other vertical markets, such as hospitality, healthcare
and retail food, which the Company believes are characterized by a critical
need for inventory management solutions.

Maintain High Quality Customer Relationships through Consulting and
Education. The Company intends to expand the size of its services and
support staff, as well as the range of services it offers, in order

31
<PAGE> 33

to maintain high customer satisfaction and generate new customers through
referrals from existing customers. The Company believes that its
consulting, implementation, educational and support services allow
customers to realize the maximum benefit from the Company's solutions. In
addition, E3 intends to expand its educational programs in the area of
scientific inventory management to inform a greater number of potential
customers about the benefits of the Company's inventory management
products.

Broaden Distribution Channels and Strategic Relationships. The
Company's strategy is to expand its sales and marketing capabilities in
order to address the worldwide market opportunity for its products. The
Company increased its direct sales force from 15 sales personnel as of
January 1, 1997 to 38 sales personnel as of March 31, 1998. As a part of
this growth in 1997, the Company established a full-time telemarketing
staff which currently consists of five persons to support its direct sales
force. As a result of its increase in sales and marketing personnel, the
aggregate initial software license fee for licenses entered into in the
quarter ended March 31, 1998 was approximately $2.9 million, as compared to
approximately $1.9 million for the quarter ended March 31, 1997. In
addition to its direct sales and support organizations, the Company has
established and will continue to establish formal and informal
relationships with third parties to assist in developing customer
relationships and marketing its product offerings.

Increase Penetration of International Markets. E3 currently sells and
supports its products through direct sales and support organizations in
North America and Europe. The Company's products support multiple
currencies and languages, which the Company believes facilitates its
expansion into new international markets. E3 plans to continue to invest
significantly in expanding its global sales, marketing, and services
presence in the geographic regions where it already has a presence and in
new geographic regions. The Company currently has offices or
representatives in ten locations worldwide, including offices in Atlanta,
Frankfurt, London, Madrid, Melbourne, Oslo, Paris, Stockholm and Venice,
and is currently planning to expand into select countries in Latin America
and the Pacific Rim.

PRODUCTS

The Company's software solutions provide comprehensive and advanced
inventory management capabilities that enable organizations to reduce
inventories, increase profitability and meet customer service objectives. The
Company's product offerings are oriented toward four distinct markets: (i)
E3TRIM targets warehouse inventory management; (ii) E3SLIM targets store
inventory management; (iii) E3CRISP targets vendor-managed inventories; and (iv)
ProfitTrack focuses on shared services inventory management.

The Company's products are modular systems that allow customers to purchase
only the functionality they require. For instance, the Company offers E3TRIM as
a base system for an initial license fee of $28,000 with approximately 25
additional modules available at additional cost. Such additional modules include
investment buying, purchase order management, service level analysis, investment
tracking, alternate source and promotional event modules. The initial license
fee for a typical E3TRIM order is $100,000, the initial license fee for a
typical E3CRISP order is $150,000, and the initial license fee for a typical
E3SLIM order is $250,000. In addition to the initial license fee, the Company
charges customers an annual software maintenance fee, which typically equals 15%
of the initial license fee and is paid in monthly installments.

The Company's products currently support nine languages and multiple
currencies. The Company's products are client/server solutions that operate on
IBM AS/400 servers and support Windows 3.1, Windows 95 and Windows NT clients
and can be linked to virtually any hardware or software platforms with minimal
additional expense.

E3TRIM -- True Replenishment and Inventory Management

E3TRIM addresses the replenishment and inventory management needs of
wholesalers and retailers performing inventory management at the warehouse or
distribution center level. E3TRIM handles replenishment and inventory management
functions such as demand forecasting, lead time forecasting, order frequency
analysis, service level goals and minimum order quantity analysis. E3TRIM
assists the user in deciding when to buy goods, how much to buy and which
distribution center is appropriate to receive the product. The
32
<PAGE> 34

forecasting model considers factors such as historical demand data, promotional
events, and lost sales by item, SKU or both. E3TRIM is designed to enhance
profitability, decrease inventory levels, improve customer service levels,
increase buyer productivity and improve management control.

E3SLIM -- Store Level Inventory Management

E3SLIM is a system designed for store level replenishment. E3SLIM addresses
the same replenishment and inventory functions as E3TRIM; however, E3SLIM
utilizes data from individual stores and the replenishment data produced is
tailored to meet unique store level requirements. Orders produced through E3SLIM
may go straight to suppliers who will deliver products to the store directly or
through distribution centers. E3SLIM is designed to provide increased
merchandiser productivity at the store level, better customer service, lower
inventory levels and reduced inventory costs, and higher revenue per store.

E3CRISP -- Customer Replenishment for Improved Service and Profit

E3CRISP is a store level replenishment and inventory management solution
aimed at manufacturers who wish to offer inventory management services to their
customers. E3CRISP allows a vendor to manage its inventory in the individual
stores or distribution centers of a retailer. Dealing directly with retailers
saves manufacturers significant time and expense and provides accuracy and
efficiency in replenishment. E3CRISP provides the following benefits: marketing
advantages for wholesalers and manufacturers, increased merchandiser
productivity, improved customer service and reduced lost sales at the consumer
level.

ProfitTrack

ProfitTrack is an Internet-based replenishment and inventory management
system similar to E3SLIM that makes available E3's inventory management
solutions to businesses worldwide. ProfitTrack provides independent retailers
and small chains with cost-effective and easy access to the Company's proven
inventory management solutions and provides larger retailers with a means to
decentralize their purchasing operations. Through ProfitTrack, the Company acts
as a service bureau whereby the customer provides data to the Company through
the Internet and the Company provides replenishment and inventory
recommendations on a next-day basis. For larger customers, the Company provides
the software to run decentralized purchasing operations over a corporate
intranet.

Executive ScoreBoard

Executive ScoreBoard is an executive information system that generates
user-friendly summary graphs allowing managers to easily access more in-depth
information. Executive ScoreBoard provides the user with more than 150 graphical
views of data, such as inventory breakdowns, historical trending, drill down and
drill back, and sorting and comparisons. Executive ScoreBoard operates in
conjunction with the customer's E3TRIM, E3SLIM or E3CRISP system.

33
<PAGE> 35

SALES AND MARKETING

To date, substantially all of the Company's revenue has been generated
through its direct sales force. The Company maintains a sales force with direct
sales representatives based in ten countries. The Company's salespersons are
compensated through quarterly and annual commission programs.

The Company increased its sales force from 15 sales personnel as of January
1, 1997 to 38 sales personnel as of March 31, 1998. A substantial portion of
this increase occurred in the first half of 1997. As part of this growth in
1997, the Company established a full-time telemarketing staff, which currently
consists of five persons, to support its direct sales force. A newly hired
salesperson generally spends three months in training and is not expected to
meet a full sales quota for another three months. Consequently, the Company
typically does not begin to realize full production from a newly hired
salesperson until approximately six months after hiring. As a result of its
increase in sales and marketing personnel since January 1, 1997, the Company has
begun to realize substantial year-to-year growth in the sales of its products.
The following table sets forth the number of salespersons as of the end of each
quarter since January 1, 1997 and the aggregate amount of initial license fees
for licenses entered into in each such quarter. The initial license fees shown
below relate to the licenses sold in the indicated period without regard to the
Company's recognition of revenue from such licenses.

<TABLE>
<CAPTION>
MARCH 31, JUNE 30, SEPT. 30, DEC. 31, MARCH 31,
1997 1997 1997 1997 1998
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Sales Personnel................. 23 27 30 33 38

Aggregate Initial Software
License Fee Amount........... $1,878,900 $3,611,660 $2,026,897 $4,247,367 $2,893,274
</TABLE>

The Company plans to continue to invest significantly in expanding its
sales, support, services and marketing organizations within the United States
and abroad.

The Company relies on its existing customer relationships as a source for
new business. In addition, the Company intends to leverage both formal and
informal relationships with a number of consulting and systems integration firms
to enhance its marketing, sales and customer support efforts, particularly with
respect to implementation and support of its products as well as lead generation
and assistance in the sales process.

The Company conducts comprehensive marketing programs that include
advertising, public relations, trade shows, joint programs with vendors and
consultants and ongoing customer communication programs. The sales cycle
typically begins with the generation of a sales lead or the receipt of a request
for proposal from a prospective customer. The sales lead or request for proposal
is followed by the qualification of the lead or prospect, an assessment of the
customer's requirements, a formal response to the request for proposal,
presentations and product demonstrations, site visits to an existing customer
utilizing the Company's products and contract negotiation. The sales cycle can
vary substantially from customer to customer but typically requires three to
nine months. As of May 15, 1998, the sales and marketing organization consisted
of 45 employees.

CUSTOMERS

The Company's target customers are primarily wholesalers and retailers, as
well as manufacturers who provide inventory management services to wholesalers
and retailers, in a variety of product sectors, including general retail;
pharmaceutical; general manufacturing; electrical, industrial and automotive
supply; food and food service; wine and spirits; and office supply. The Company
has licensed its products to over 600 customers. No single customer accounted
for 10% or more of the Company's revenues in 1995, 1996 or 1997.

34
<PAGE> 36

The following table sets forth selected customers in each of its targeted
industry segments. Except as otherwise noted, all such customers are located in
the United States.

<TABLE>
<S> <C>
GENERAL RETAIL ELECTRICAL, INDUSTRIAL AND AUTOMOTIVE SUPPLY
Ace Hardware Corporation Advance Auto Parts
Best Buy Co., Inc. Graybar Electric Co., Inc.
DFS Group, Ltd. (Duty Free Stores) Northern Hydraulics, Inc.
The Sports Authority, Inc. Rexel Management, S.A. (France)
Victoria's Secret Stores XPEDEX (International Paper Company)
Woolworth's plc (United Kingdom)
FOOD & FOOD SERVICE
PHARMACEUTICAL Associated Food Stores, Inc.
CVS Corporation Coop Schweiz (Switzerland)
Eckerd Corporation Iceland Foods plc (United Kingdom)
Hoechts Marion Roussell (Canada) NKL (Norway)
Rite Aid Corporation PYA/Monarch, Inc.
Sigma Company Ltd. (Australia)
WINE & SPIRITS
GENERAL MANUFACTURING Eber Brothers Wine & Liquor Corp.
General Nutrition Incorporated (GNC) Glazer's Wholesale Distributors, Inc.
OKI Bering Southern Wine & Spirits of America, Inc.
Oneida Ltd. Whitbread plc (United Kingdom)
Rubbermaid, Inc.
SKF Dataservice AB (Sweden) OFFICE SUPPLY
Universal City Studios, Inc. BT Office Products International, Inc.
Kaiser & Kraft GmbH (Germany)
Staples, Inc. (US/Europe)
Viking Office Products, Inc. (US/Europe/Australia)

</TABLE>

CUSTOMER CASE STUDIES

The following case studies illustrate the utilization and benefits of the
Company's products as experienced by certain of its customers:

ACE HARDWARE CORPORATION

Ace Hardware Corporation ("Ace"), a cooperative distributor of hardware,
paint and do-it-yourself products to a dealer network of over 5,000 retail
business outlets, was utilizing an inventory management system that failed to
meet many of its business needs. In particular, Ace desired to increase its
in-stock rates in order to provide better service to its dealers and to better
manage its inventory in order to increase its profits, which, as a cooperative,
are ultimately distributed to its dealers. After implementing E3TRIM, Ace
reported to the Company a $50 million reduction in inventory, a 25% reduction in
lost sales and an in-stock rate of 95% in its first year of use.

THE SPORTS AUTHORITY, INC.

The Sports Authority, Inc. ("Sports Authority"), an operator of large
sporting goods stores in the United States with over 185 locations, initially
installed E3SLIM at a time when it had only six locations and many of its
replenishment functions were performed manually. Sports Authority sought a
replenishment and inventory management system that could automate and optimize
its replenishment functions and accommodate its rapid growth plan. In
particular, Sports Authority noted the following benefits of E3SLIM: (i)
centralized replenishment functions allowing store level employees to focus on
customer service functions; (ii) simple and rapid implementation of the system
into new stores; and (iii) scalability to support the growth in the number of
store locations from six to more than 185. After installing E3SLIM, as well as
implementing the Company's approach to the buying process, Sports Authority
reported a 20% reduction in inventory levels while increasing inventory turns
and maintaining a 92% service level in the first year after implementation. The
Sports Authority's E3SLIM system actively manages over 1.7 million SKUs.
35
<PAGE> 37

OKI BERING

OKI Bering, a leading wholesale distributor of industrial, safety and
welding supplies in North America, operated in an industry that historically had
not utilized advanced inventory management systems. OKI Bering chose E3TRIM as
part of its strategy to increase market share by improving its service levels
above industry norms. After implementing E3TRIM, OKI Bering reported to the
Company an increase in customer service levels from 92% to 98% and a 22%
decrease in inventory levels in the first year after implementation. After four
months of utilizing E3TRIM, OKI Bering installed E3CRISP in order to assist its
distributors in improving productivity and optimizing inventory levels. OKI
Bering is currently using E3CRISP as a marketing tool to attract new customers
and improve service to existing customers.

The benefits reported above are based upon information provided to the
Company by such customers, and factors unrelated to the Company's products may
have contributed to such benefits. There can be no assurance that new or
existing customers will achieve any of the benefits described above.

SERVICES AND SUPPORT

E3 provides consulting services to customers in the following areas: sales,
technical installation, implementation planning, customer training, project
management and performance analysis. All of the Company's consultants are
specialists in their fields. For example, customer training consultants are
primarily former users of the Company's products, and customer training
consultants assigned to a food wholesale implementation are typically food
wholesale specialists. The Company has recognized a growing need among its
customers for support and consulting services. The Company plans to continue to
hire additional support and service personnel to meet this need. Accordingly,
the Company anticipates that revenue from services will increase as a percentage
of total revenue in the future.

In 1989, the Company established IMI to provide executives and
professionals in the retail and wholesale segments of the supply chain with
educational and consulting services. The Company believes that IMI is the only
educational facility in the world that is dedicated to scientific inventory
management. IMI offers business school-type curriculum covering both E3
product-specific seminars and inventory management seminars. IMI's courses are
aimed at both potential users as well as senior executives of potential
customers. To date, IMI has trained over 5,000 professionals and executives.
While IMI was originally conceived as an educational resource for E3 customers,
increasingly IMI's programs are being attended by non-customers. E3 intends to
continue to utilize IMI as an educational resource for companies that do not
currently utilize E3 software, thereby creating an additional revenue source for
the Company and a means to educate prospective customers about the benefits
associated with the use of the Company's software products.

PRODUCT DEVELOPMENT AND TECHNOLOGY

The Company's product development efforts are focused on adding new
functionality to existing products and enhancing the operability of its products
across distributed and changing heterogeneous hardware platforms, operating
systems and relational database systems. The Company believes that its future
success depends in part upon its ability to continue to enhance existing
products, respond to changing customer requirements and develop and introduce
new or enhanced products that incorporate new technological developments and
emerging industry standards.

The Company's product development organization is structured to
consistently provide a steady flow of products and enhancements to assure that
the Company has the product offerings needed to meet its strategic objectives.
The Company's focus is on balancing the development of new offerings with the
development of enhancements to existing offerings so the Company can: (i)
penetrate new markets; (ii) capture new customers within existing markets; (iii)
provide useful add-ons for existing customers; and (iv) maintain a strong
reference base.

The Company's development organization is structured into four teams: (i)
technology development, which develops product architecture and new
technologies; (ii) strategic development, which develops next-generation
products; (iii) production development, which delivers add-ons and enhancements
of current

36
<PAGE> 38

products; and (iv) product support, which helps end users maximize the products'
benefits and features. The development organization works very closely with
customers during the prototyping, development and testing phases of product
development. A rapid prototyping methodology is used to assure that the correct
functional requirements are addressed during the early stages of new
development. At the end of the development cycle, beta customers are identified
to perform true field tests before the products are released for general
availability.

The Company's primary technology initiative is to convert the server
portion of its code to C++ and SQL so that a common code base can be run on the
AS/400, UNIX/AIX, and Windows NT platforms to provide multi-platform support. As
part of this effort, the Company is examining whether database providers such as
Oracle and Informix, with the recent inclusion of parallel processing
functionality in their products, can deliver the performance needed to run the
server portion of the Company's products on UNIX/AIX and Windows NT platforms.

The architecture of the Company's inventory management products has been
designed for simplified integration into any legacy or ERP system running on any
platform. Implementation of the Company's products requires no specialized
skills on the customer's part. A simple flat file architecture (similar to the
widely adapted standard used for EDI) affords an efficient path to quick
implementation and integration into any ERP system.

The client portion of the Company's software systems runs on the Windows
3.1, Windows 95 and Windows NT platforms. The Company chose the IBM AS/400 as
its primary server platform because of its performance, scalability, operational
reliability, operational design and database robustness. A scientific inventory
management system must evaluate every item, in every location, every night,
resulting in database tables with potentially millions of rows. To date, the
Company believes that in a transaction-based environment, the AS/400 is one of
the few platforms that can deliver the performance needed to meet this very
challenging requirement. In addition, because IBM delivers the AS/400 as a
complete system with no additional software or tools that need to be installed
after implementation, it can be easily integrated into any IT hardware
environment with little or no additional requirements.

The Company's product development expenditures for the years ended December
31, 1995, 1996 and 1997 were approximately $2.4 million, $2.6 million and $3.2
million, respectively. The Company intends to continue to increase its
investment in product development in the future.

COMPETITION

The market for the Company's products is intensely competitive, highly
fragmented and subject to rapid change. Competitors include: (i) ERP software
vendors such as SAP AG, PeopleSoft, Inc., Oracle Corporation and Baan Company
N.V., each of which currently offers ERP solutions that may incorporate supply
chain management modules or advanced planning and scheduling software; (ii)
other suppliers of advanced planning and scheduling software, including i2
Technologies Inc., Manugistics Group, Inc. and Logility Inc.; (iii) other
business application software vendors who may broaden their product offerings by
internally developing, or by acquiring or partnering with independent developers
of, advanced planning and scheduling software; (iv) internal development efforts
by corporate IT departments; and (v) companies offering standardized or
customized products for mainframe and/or mid-range computer systems. Increased
competition may result in reduced operating margins and loss of market share,
either of which could have a material adverse effect on the Company's business,
financial condition and results of operations.

competition will result in reductions in market share, pressure for price
reductions and related reductions in gross margins, any of which could
materially and adversely affect the Company's business, operating results and
financial condition. There can be no assurance that in the future the Company
will be able to successfully compete against current and future competitors and
the failure to do so could have a material adverse effect on the Company's
business, operating results and financial condition. See "Risk
Factors -- Competition."

The principal competitive factors affecting the market for the Company's
products include vendor and product reputation, architecture, functionality and
features, speed, costs and ease of implementation, quality of support and
product quality, price and performance. Based on these factors, the Company
believes that it has competed effectively to date, particularly in the wholesale
and retail markets. The Company believes that its products have a competitive
advantage over ERP and legacy systems due to the advanced functionality offered
by the Company's products. Also, because they are specifically designed for the
wholesale and retail markets, the Company further believes that its products
have a competitive advantage in these markets over most other SCM systems, which
have been designed primarily for manufacturers. The Company also believes that
its knowledge and expertise in inventory management systems aimed at optimizing
profitability provide a significant competitive advantage.

PROPRIETARY RIGHTS AND LICENSES

The Company relies on a combination of copyright, trade secret, trademark
and trade dress laws, confidentiality procedures and contractual provisions to
protect its proprietary rights in its products and technology. The Company
generally enters into confidentiality agreements with its employees,
consultants, clients and potential clients and limits access to, and
distribution of, its proprietary information. The Company maintains trademarks
to identify the source of its products, development tools and service offerings
and relies upon trademark and trade dress laws to protect its proprietary rights
in these marks. The Company licenses its products to its customers in object
code format and restricts the customer's use for internal purposes without the
right to sublicense its products. However, the Company believes that the
foregoing measures afford only limited protection. In connection with certain of
its license agreements, the Company has established in the past, and may
continue to establish, escrows of the source code for its licensed products with
third parties for the benefit of its customers. There can be no assurance that
unauthorized use of the Company's source code for its products will not occur as
a result of these escrow arrangements. Despite the Company's efforts to
safeguard and maintain its proprietary rights both in the United States and
abroad, there can be no assurance that the Company will be successful in doing
so or that the steps taken by the Company in this regard will be adequate to
deter misappropriation or independent third-party development of the Company's
technology or to prevent an unauthorized third party from copying or otherwise
obtaining and using the Company's products or technology. In addition, policing
unauthorized use of the Company's products is difficult, and while the Company
is unable to determine the extent to which piracy of its software products
exists, software piracy may currently be or could become a problem.

As the number of supply chain management applications in the industry
increases and the functionality of these products further overlaps, software
development companies like the Company may increasingly become subject to claims
of infringement or misappropriation of the intellectual property rights of
others. There can be no assurance that third parties will not assert
infringement or misappropriation claims against the Company in the future with
respect to current or future products. Any claims or litigation, with or without
merit, could be time consuming, result in costly litigation, diversion of
management's attention and cause product shipment delays or require the Company
to enter into royalty or licensing arrangements. Such royalty or licensing
arrangements, if required, may not be available on terms acceptable to the
Company, if at all, which could have a material adverse effect on the Company's
business, operating results and financial condition. Adverse determinations in
such claims or litigation could also have a material adverse effect on the
Company's business, operating results and financial condition.

effect on the Company's business, operating results and financial condition,
regardless of the final outcome of such litigation. Despite the Company's
efforts to safeguard and maintain its proprietary rights both in the United
States and abroad, there can be no assurance that the Company will be successful
in doing so, or that the steps taken by the Company in this regard will be
adequate to deter misappropriation or independent third-party development of the
Company's technology or to prevent an unauthorized third party from copying or
otherwise obtaining and using the Company's products or technology. Any such
events could have a material adverse effect on the Company's business, operating
results and financial condition. See "Risk Factors -- Intellectual Property
Rights."

EMPLOYEES

As of May 15, 1998, the Company had 175 full-time employees. Of that
number, 45 were employed in sales and marketing, 25 in product development, 35
in administration and finance and 70 in implementation, education and customer
support services. None of the employees of the Company are covered by a
collective bargaining agreement. The Company considers its relations with its
employees to be good.

The Company believes its future success will depend in large part on its
ability to recruit and retain qualified employees, especially experienced
software engineering personnel. The competition for such personnel is intense,
and there can be no assurance that the Company will be successful in retaining
or recruiting key personnel.

FACILITIES

The Company's principal administrative, sales, marketing, support, and
product development facility is located in approximately 57,000 square feet of
leased office space in Atlanta, Georgia. The Company also maintains a small
office in Mahwah, New Jersey. In addition, the Company leases space in France,
Germany, Italy, Norway, Sweden and the United Kingdom. Management believes its
current facilities are adequate for its present requirements.

LEGAL PROCEEDINGS

The Company is not a party to any material legal proceedings.

39
<PAGE> 41

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The directors and executive officers of the Company and their ages as of
the date of this Prospectus are as follows:

<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Anders H. Herlitz...................... 59 Chairman and Chief Executive Officer
Frank K. Schuster...................... 52 President, Chief Operating Officer and
Director
William H. Huther...................... 65 Vice Chairman and Senior Vice
President -- Sales and Marketing
Daniel J. Craddock..................... 37 Senior Vice President -- Consulting
Services and President of IMI
Carl H. Herlitz........................ 31 Senior Vice President -- Business
Planning and IT Services
R. Lee Morris.......................... 52 Chief Financial Officer
David J. Johnston...................... 35 Vice President -- Product Development
Thomas J. O'Haren...................... 64 Director (1)(2)
</TABLE>

- ---------------

(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.

Anders H. Herlitz founded the Company in 1980 and has served as Chairman
and Chief Executive Officer since its founding. From 1960 to 1980, Mr. Herlitz
served in a variety of development and management roles for IBM. Mr. Herlitz was
the architect behind IBM's INVEN/3 and INVEN/34 products, which were among the
earliest inventory management products introduced in the marketplace, and was
instrumental in the design of DMAS Inventory Management, a successor product to
INVEN/34.

Frank K. Schuster has served as President, Chief Operating Officer and as a
director of the Company since 1993. From 1987 to 1993, Mr. Schuster served as
Executive Vice President and Chief Financial Officer of the Company. Mr.
Schuster joined the Company in 1985 as Vice President -- Marketing. From 1973 to
1985, Mr. Schuster served as Executive Vice President and General Manager of
Lynch Foods, Inc., a food distributor. From 1969 to 1973, Mr. Schuster served as
a marketing representative and systems engineer for IBM. Mr. Schuster holds a
BBA from Ohio University and an MBA from the University of Alabama.

William H. Huther has served as Vice Chairman and Senior Vice
President -- Sales and Marketing of the Company since 1996 and is responsible
for worldwide sales planning, third-party alliances and marketing
communications. Mr. Huther joined the Company in 1986 as Vice President of the
Company's subsidiary, E3 North America, Inc., and served as President of that
subsidiary from 1992 until 1996. From 1968 to 1986, Mr. Huther served in sales
and management positions with a variety of software companies, including co-
founding Cambridge Computer, Inc. ("Cambridge") in 1968, which provided sales
and distribution-related information systems to organizations, and serving as a
Vice President of Cambridge until 1972. From 1959 to 1968, Mr. Huther served in
numerous sales and sales management positions with IBM.

Daniel J. Craddock has served as the Company's Senior Vice
President -- Consulting Services and President of IMI since 1997. From 1996 to
1997, Mr. Craddock served as President of the Company's subsidiary, E3 North
America Inc., and from 1990 to 1996, Mr. Craddock served as the Company's Vice
President of Consulting. Mr. Craddock joined the Company in 1987 and served in
various sales, marketing, consulting and education functions within the Company
until 1990. Mr. Craddock is a graduate of Pennsylvania State University's
business logistics and physical distribution program.

Carl H. Herlitz has served as Senior Vice President -- Business Planning
and IT Services since 1997. From 1991 to 1997, Mr. Herlitz was responsible for
the establishment of four of the Company's European offices. Mr. Herlitz was a
programmer and co-developer of the original E3TRIM release from 1989 to 1991.

40
<PAGE> 42

Mr. Herlitz joined the Company in 1986 as a programmer. Mr. Herlitz is a
graduate of the University of Georgia with a BBA in International Business.

R. Lee Morris joined the Company as its Chief Financial Officer in July
1997. From 1997 until joining the Company, Mr. Morris served as Senior Vice
President of DocuCorp International Inc. ("DocuCorp"), and from 1989 to 1997,
Mr. Morris served as Senior Vice President, Chief Financial Officer and
Secretary of FormMaker Software, Inc., the predecessor of DocuCorp, which
provides enterprise document automation software and services. Mr. Morris also
served as a Director of FormMaker Software, Inc. from 1995 to 1996. From 1981 to
1989, Mr. Morris served as Senior Vice President and Chief Financial Officer of
American Technical Services Group, Inc. ("ATS"), an instrumentation control
systems company. From 1970 to 1981, Mr. Morris was with Coopers & Lybrand. Mr.
Morris is a CPA and a graduate of Florida State University.

David J. Johnston has served as Vice President -- Product Development since
1997. From 1996 to 1997, Mr. Johnston served as the Company's Director of
Development and was responsible for all product enhancements and new product
development. Mr. Johnston joined the Company in 1995 as a product manager. From
1989 to 1995, Mr. Johnston served as a development manager at IBM, working on
inventory management product solutions. From 1985 to 1989, Mr. Johnston served
as an applications developer for Federated Department Stores. Mr. Johnston
graduated from Louisiana State University with a B.S. in computer science and
business management.

Thomas J. O'Haren has served as a director of the Company since 1993. Mr.
O'Haren has served as a consultant to Cigna Financial Advisors, Inc. ("Cigna"),
an insurance company, since 1992. From 1957 to 1992, Mr. O'Haren served in a
variety of management positions with Cigna, including Regional Vice President.
Mr. O'Haren holds a B.S. degree from Pennsylvania State University and has
received Chartered Life Underwriter and Chartered Financial Consultant
designations from the American College in Bryn Mawr, Pennsylvania. Mr. O'Haren
is also a director of Jameson Inns, Inc., a hotel company.

Anders H. Herlitz, the Company's Chairman and Chief Executive Officer, is
the father of Carl H. Herlitz, the Company's Senior Vice President -- Business
Planning and IT Services.

ELECTION OF DIRECTORS

The Company intends to add one or more independent directors to its Board
of Directors within 90 days after the date of this Prospectus. It will be
necessary for the Company to appoint at least one independent director within
the 90-day time period in order to maintain its Nasdaq National Market listing.
Failure to appoint such a director could result in a delisting of the Common
Stock from the Nasdaq National Market.

TERMS OF DIRECTORS

Upon consummation of the Offering, the Board of Directors will be divided
into three classes, each of whose members will serve for a staggered three-year
term. The Board will be comprised of two Class I directors (Mr. Huther and Mr.
O'Haren), one Class II director (Mr. Schuster) and one Class III director (Mr.
Herlitz). Following the proposed election of an additional independent director
to the Board of Directors, such person is expected to be a Class II director. At
each annual meeting of shareholders, a class of directors will be elected for a
three-year term to succeed the directors of the same class whose terms are then
expiring. The terms of the initial Class I directors, Class II directors and
Class III directors will expire upon the election and qualification of successor
directors at the 1999, 2000 and 2001 annual meetings of shareholders,
respectively. See "Description of Capital Stock -- Certain Articles of
Incorporation and Bylaw Provisions."

COMMITTEES OF THE BOARD OF DIRECTORS

Mr. O'Haren currently serves as the sole member of the Compensation
Committee and the Audit Committee. Upon the election of an additional outside
director, such person is expected to be appointed to the Compensation Committee
and Audit Committee. The Compensation Committee is responsible for reviewing and
recommending salaries, bonuses and other compensation for the Company's
executive officers. The Compensation Committee also is responsible for
administering the Company's stock option plan and for

41
<PAGE> 43

establishing the terms and conditions of all stock options granted under the
plan. The Audit Committee is responsible for recommending independent auditors,
reviewing with the independent auditors the scope and results of the audit
engagement, monitoring the Company's financial policies and control procedures
and reviewing and monitoring the provisions of nonaudit services by the
Company's auditors.

COMPENSATION OF DIRECTORS

Mr. O'Haren received $10,000 in exchange for his services as a member of
the Board of Directors during 1997. Directors who are employees of the Company
do not receive any compensation for services performed in their capacity as
directors. The Company reimburses each director for reasonable out-of-pocket
expenses incurred in attending meetings of the Board of Directors and any of its
committees.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Mr. O'Haren, currently the sole member of the Compensation Committee, was
not at any time during the year ended December 31, 1997 or at any other time an
officer or employee of the Company. No executive officer of the Company serves
as a member of the board of directors or compensation committee of another
entity which has one or more executive officers serving as a member of the
Company's Board of Directors or Compensation Committee.

EXECUTIVE COMPENSATION

The following table sets forth the total compensation earned by the
Company's Chief Executive Officer and the Company's four other most highly
compensated executive officers who were serving as executive officers at the end
of 1997 (collectively, the "Named Executive Officers") for services rendered to
the Company in 1997.

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL AWARDS
COMPENSATION(1) --------------------
-------------------- NUMBER OF SECURITIES ALL OTHER
NAME AND PRINCIPAL POSITION SALARY BONUS(2) UNDERLYING OPTIONS COMPENSATION(3)
- --------------------------- -------- --------- -------------------- ---------------
<S> <C> <C> <C> <C>
Anders H. Herlitz................................ $ 48,000 $ 918,095 150,000 $ 2,850
Chairman and Chief
Executive Officer
Frank K. Schuster................................ 48,000 308,320 65,000 2,850
President and Chief Operating Officer
William H. Huther................................ 48,000 308,320 65,000 2,850
Vice Chairman and Senior Vice
President -- Sales and Marketing
Daniel J. Craddock............................... 65,323 205,248 35,000 2,850
Senior Vice President -- Consulting Services
and President of IMI
Carl H. Herlitz.................................. 113,522 116,188 30,000 --
Senior Vice President -- Business Planning
and IT Services
</TABLE>

- ---------------

(1) In accordance with the rules of the Securities and Exchange Commission, the
compensation set forth in the table does not include compensation in the
form of perquisites or other personal benefits because such perquisites and
other personal benefits constituted less than the lesser of $50,000 or 10%
of the total annual salary and bonus for the Named Executive Officer for
such year.
(2) Represents bonuses and sales commissions.
(3) Consists of amounts paid under the Company's 401(k) plan.

42
<PAGE> 44

OPTION GRANTS IN LAST FISCAL YEAR

The following table sets forth all individual grants of stock options
during the year ended December 31, 1997, to each of the Named Executive
Officers:

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
-------------------------------------------------------- VALUE AT ASSUMED
NUMBER OF ANNUAL RATES OF STOCK
SECURITIES PERCENT OF TOTAL PRICE APPRECIATION
UNDERLYING OPTIONS GRANTED EXERCISE OR FOR OPTION TERM(2)
OPTIONS TO EMPLOYEES IN BASE PRICE EXPIRATION ----------------------
NAME GRANTED(1) FISCAL YEAR PER SHARE DATE 5% 10%
- ---- ---------- ---------------- ----------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Anders H. Herlitz........ 150,000 20.7% $9.25 1/15/07 $872,591 $2,211,318
Frank K. Schuster........ 65,000 9.0 9.25 1/15/07 378,123 958,238
William H. Huther........ 65,000 9.0 9.25 1/15/07 378,123 958,238
Daniel J. Craddock....... 35,000 4.8 9.25 1/15/07 203,605 515,974
Carl H. Herlitz.......... 30,000 4.1 9.25 1/15/07 174,518 442,264
</TABLE>

- ---------------

(1) All options were granted at exercise prices equal to or in excess of the
fair market value of the Common Stock on the date of grant as determined by
the Board of Directors. The options are nonqualified stock options, vest
over four years and have a 10-year term.
(2) The potential realizable value is calculated based on the 10-year term of
the option at the time of its grant. It is calculated by assuming that the
stock price on the date of grant appreciates at the indicated annual rate,
compounded annually over the term of the option. These numbers are
calculated based upon rules promulgated by the Securities and Exchange
Commission and do not represent the Company's estimate or projection of the
future value of the Common Stock. The actual realizable value of the options
based on the price to public in the Offering will exceed the potential
realizable value shown in the table.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR-END OPTION VALUES

The following table summarizes the value of the outstanding options held by
the Named Executive Officers as of December 31, 1997:

<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AT FISCAL YEAR-END OPTIONS AT FISCAL YEAR-END(1)
---------------------------- ------------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ------------- ------------ --------------
<S> <C> <C> <C> <C>
Anders H. Herlitz.................... -- 150,000 -- --
Frank K. Schuster.................... -- 65,000 -- --
William H. Huther.................... -- 65,000 -- --
Daniel J. Craddock................... -- 35,000 -- --
Carl H. Herlitz...................... -- 30,000 -- --
</TABLE>

- ---------------

(1) There was no public trading market for the Common Stock as of December 31,
1997. All options held by the Named Executive Officers have an exercise
price per share of $9.25, which exceeds the estimated fair market value of
the Company's Common Stock underlying the options as of December 31, 1997 as
determined by the Company's Board of Directors. In determining the fair
market value of the Company's Common Stock, the Board of Directors
considered various factors, including the Company's financial condition and
business prospects, its operating results, the absence of a market for its
Common Stock and the risks normally associated with technology companies.

STOCK OPTION AND OTHER COMPENSATION PLANS

Stock Incentive Plan. The Stock Incentive Plan became effective on January
1, 1997. The aggregate number of shares reserved for issuance under the Stock
Incentive Plan is 3,000,000 shares. The purpose of the Stock Incentive Plan is
to provide incentives for key employees, officers, consultants and directors to
promote the success of the Company and to enhance the Company's ability to
attract and retain the services of such persons. Options granted under the Stock
Incentive Plan may be either options intended to qualify as "incentive stock
options" under Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), or nonqualified stock options.

43
<PAGE> 45

As of May 31, 1998, options to purchase 898,919 shares of Common Stock were
outstanding under the Stock Incentive Plan at a weighted average exercise price
of $10.00 per share, and no shares of Common Stock have been issued upon
exercise of options granted under the Stock Incentive Plan.

Other Incentives. In addition to options issued under the Stock Incentive
Plan, as of May 31, 1998, the Company has outstanding options to purchase an
aggregate of 148,354 shares of Common Stock granted to employees separate from
and outside of the Stock Incentive Plan with a weighted average exercise price
of $9.10 per share.

401(k) Profit Sharing Plan. The Company maintains a 401(k) Profit Sharing
Plan (the "401(k) Plan") which is intended to be a tax-qualified defined
contribution plan under Section 401(k) of the Code. In general, all employees of
the Company who have attained age 21 and completed 30 days of service are
eligible to make salary deferrals under the 401(k) Plan. Employees must complete
one year of service in order to be eligible for matching contributions. The
40l(k) Plan includes a salary deferral arrangement pursuant to which
participants may contribute, subject to certain limitations prescribed by the
Code, a maximum of 15% of their salary on a pre-tax basis. The Company may make
matching contributions under the 401(k) Plan equal to a percentage (determined
by the Company) of participants' salary deferrals. The Company may also make an
additional contribution to the 401(k) Plan each year at the discretion of the
Board of Directors. In 1997, the Company contributed and aggregate of $85,100 to
the 401(k) Plan. Participants are always fully vested in their accounts.
Distributions from the 401(k) Plan may be made in the form of a lump-sum cash
payment, in installment payments or annuity payments.

LIMITATION OF LIABILITY AND INDEMNIFICATION OF OFFICERS AND DIRECTORS

The Company's Amended and Restated Articles of Incorporation (the "Restated
Articles") provide that the directors shall not be liable for monetary damages
except for (i) any appropriation, in violation of his or her duties, of any
business opportunity of the Company, (ii) acts or omissions which involve
intentional misconduct or a knowing violation of laws, (iii) any liability under
Section 14-2-832 of the Georgia Business Corporations Code (the "GBCC"), which
relates to unlawful payments of dividends and unlawful stock repurchases and
redemptions or (iv) any transaction from which he or she derived an improper
personal benefit. This limitation of liability does not affect the availability
of injunctive relief or other equitable remedies.

The Company's Amended and Restated Bylaws (the "Restated Bylaws") provide
that the Company will indemnify each of its directors and may indemnify each of
its officers, employees and agents to the extent that he or she is or was a
party, or is threatened to be made a party, to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that such person is or was a director,
officer, employee or agent of the Company, against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement in connection
with such action, suit or proceeding; provided, however, that no indemnification
of directors shall be made for (i) any appropriation, in violation of his or her
duties, of any business opportunity of the Company, (ii) acts or omissions which
involve intentional misconduct or a knowing violation of laws, (iii) any
liability under Section 14-2-832 of the GBCC which relates to unlawful payments
of dividends and unlawful stock repurchases and redemptions or (iv) any
transaction from which he or she derived an improper personal benefit.

The Company intends to obtain a directors and officers liability insurance
policy.

CERTAIN TRANSACTIONS

In 1996, the Company paid a $500,000 fee for consulting services to a
corporation that is wholly owned by Anders H. Herlitz.

The Board of Directors of the Company has adopted a resolution whereby all
future transactions, including any loans from the Company to its officers,
directors, principal shareholders or affiliates, will require the approval of a
majority of the Board of Directors, including a majority of the independent and
disinterested members of the Board of Directors, if required by law, or a
majority of the disinterested shareholders and will be on terms no less
favorable to the Company than could be obtained from unaffiliated third parties.

44
<PAGE> 46

PRINCIPAL AND SELLING SHAREHOLDERS

The following table sets forth information with respect to the beneficial
ownership of the Company's Common Stock as of the date of this Prospectus and as
adjusted to reflect the sale by the Company of the Common Stock being offered
hereby by: (i) each director of the Company; (ii) each of the Named Executive
Officers; (iii) each shareholder known by the Company to be beneficial owners of
more than 5% of the outstanding shares of Common Stock; (iv) the Selling
Shareholders; and (v) all executive officers and directors of the Company as a
group.

<TABLE>
<CAPTION>
SHARES BENEFICIALLY NUMBER OF SHARES BENEFICIALLY
OWNED SHARES TO OWNED AFTER THE
PRIOR TO THE OFFERING(2) BE SOLD IN OFFERING(2)
------------------------ THE ----------------------
NAME AND ADDRESS OF BENEFICIAL OWNER(1) SHARES PERCENTAGE OFFERING SHARES PERCENTAGE
- --------------------------------------- ---------- ----------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C>
Anders H. Herlitz(3)....................... 5,885,725 37.6% %
Christina R. Herlitz(4).................... 5,885,725 37.6
Carl H. Herlitz............................ 2,926,950 18.7
Jan W. Herlitz............................. 2,926,950 18.7
Frank K. Schuster.......................... 1,691,000 10.8
William H. Huther.......................... 1,691,000 10.8
Daniel J. Craddock......................... 338,200 2.2
Kenneth Axelsson........................... 79,800 *
Oue Andre.................................. 31,825 *
Bjorn Walsinger............................ 31,825 *
Fritz-Lenmart Egnell....................... 31,825 *
Bjorn Uttergard............................ 14,250 *
Thomas J. O'Haren.......................... -- *
All directors and executive officers as a
group (9 persons)........................ 12,532,875 80.1% %
</TABLE>

- ---------------

* Less than one percent.
(1) Unless otherwise set forth herein, the street address of the named
beneficial owner is c/o E3 Corporation, 1800 Parkway Place, Suite 600,
Marietta, Georgia 30067.
(2) For purposes of calculating the percentage beneficially owned, the number of
shares of Common Stock deemed outstanding prior to the Offering includes
15,649,350 shares outstanding as of May 31, 1998. The number of shares of
Common Stock deemed outstanding after the Offering includes an additional
shares that are being offered for sale by the Company in the
Offering. Beneficial ownership is determined in accordance with the rules of
the Securities and Exchange Commission that deem shares to be beneficially
owned by any person or group who has or shares voting and investment power
with respect to such shares.
(3) Includes 2,926,950 shares of Common Stock owned by Mr. Herlitz's spouse,
Christina R. Herlitz. Mr. Herlitz disclaims beneficial ownership of the
shares owned by Ms. Herlitz.
(4) Includes 2,958,775 shares of Common Stock owned by Ms. Herlitz's spouse,
Anders H. Herlitz. Ms. Herlitz disclaims beneficial ownership of the shares
owned by Mr. Herlitz.

45
<PAGE> 47

DESCRIPTION OF CAPITAL STOCK

GENERAL

The authorized capital stock of the Company consists of (i) 100,000,000
shares of Common Stock, $.05 par value per share, and (ii) 50,000,000 shares of
preferred stock, $.01 par value per share (the "Preferred Stock"). As of May 31,
1998, the Company had issued and outstanding 15,649,350 shares of Common Stock.
The following description of the capital stock of the Company is a summary and
is qualified in its entirety by the provisions of the Restated Articles and
Restated Bylaws, copies of which have been filed as exhibits to the Registration
Statement of which this Prospectus is a part.

COMMON STOCK

Holders of shares of Common Stock are entitled to one vote per share for
the election of directors and all matters to be submitted to a vote of the
Company's shareholders. Subject to the rights of any holders of Preferred Stock
which may be issued in the future, the holders of shares of Common Stock are
entitled to share ratably in such dividends as may be declared by the Board of
Directors and paid by the Company out of funds legally available therefor. In
the event of a dissolution, liquidation or winding up of the Company, holders of
shares of Common Stock are entitled to share ratably in all assets remaining
after payment of all liabilities and liquidation preferences, if any. Holders of
shares of Common Stock have no preemptive, subscription, redemption or
conversion rights. The outstanding shares of Common Stock are, and the shares of
Common Stock to be issued by the Company in connection with the Offering will
be, duly authorized, validly issued, fully paid and nonassessable.

PREFERRED STOCK

The Board of Directors is authorized, subject to certain limitations
prescribed by law and without further shareholder approval, to issue from time
to time up to an aggregate of 50,000,000 shares of Preferred Stock in one or
more series and to fix or alter the designations, preferences, rights and any
qualifications, limitations or restrictions on the shares of each such series
thereof, including the dividend rights, dividend rates, conversion rights,
voting rights, terms of redemption (including sinking fund provisions),
redemption price or prices, liquidation preferences and the number of shares
constituting any series or designations of such series. The issuance of
Preferred Stock may have the effect of delaying, deferring or preventing a
change of control of the Company. There are no outstanding shares of Preferred
Stock and no series have been designated.

CERTAIN ARTICLES OF INCORPORATION AND BYLAW PROVISIONS

The Company's Restated Articles provide that special meetings of
shareholders may be called only by: (i) the Board of Directors; (ii) the
Chairman of the Board of Directors (if one is so appointed); (iii) the Chief
Executive Officer of the Company; (iv) the President of the Company; or (v)
holders of not less than 35% of all votes entitled to be cast on any issue
proposed to be considered at the proposed special meeting. The Restated Articles
and Restated Bylaws also provide for a classified Board of Directors and permit
removal of directors only for cause. See "Management -- Directors and Executive
Officers."

The Company's Restated Articles establish an advance notice procedure for
the nomination, other than by or at the direction of the Board of Directors or a
committee thereof, of candidates for election as directors, as well as for other
proposals to be considered at shareholders' meetings. Notice of shareholder
proposals and director nominations must be given timely in writing to the
Secretary of the Company before the meeting at which such matters are to be
acted upon or directors are to be elected. Such notice, to be timely, must be
received at the principal executive offices of the Company with respect to
shareholder proposals and elections to be held at the annual meeting, not less
than 60 days before the date of the meeting; however, if less than 70 days
notice or prior public disclosure of the date of the scheduled meeting is given
or made, notice by the shareholder, to be timely, must be delivered or received
not later than the close of business on the tenth day following the earlier of
the day on which notice of the date of the meeting is mailed to shareholders or
public disclosure of the date of such meeting is made.

46
<PAGE> 48

Notice to the Company from a shareholder who intends to present a proposal
or to nominate a person for election as a director at a shareholders' meeting
must contain certain information about the shareholder giving such notice and,
in the case of director nominations, all information that would be required to
be included in a proxy statement soliciting proxies for the election of the
proposed nominee (including such person's written consent to serve as a director
if so elected). If the presiding officer at the meeting determines that a
shareholder's proposal or nomination is not made in accordance with the
procedures set forth in the Restated Articles, such proposal or nomination, at
the direction of such presiding officer, may be disregarded. The notice
requirement for shareholder proposals contained in the Restated Bylaws does not
restrict a shareholder's right to include proposals in the Company's annual
proxy materials pursuant to rules promulgated under the Securities Exchange Act
of 1934, as amended.

The Restated Articles provide for a staggered Board of Directors as
described under "Management -- Terms of Directors." Therefore, under the GBCC,
directors may be removed only for cause. "For cause" shall mean (i) misconduct
as a director of the Corporation or any subsidiary of the Corporation which
involves dishonesty with respect to a material corporate activity or material
corporate asset, or (ii) conviction of an offense punishable by one or more
years of imprisonment (other than minor regulatory infractions and traffic
violations which do not materially and adversely affect the Company).

The Board of Directors shall have the power to increase or decrease the
authorized number of directors, with or without shareholder approval. Newly
created directorships resulting from any increase in the number of directors or
any vacancy on the Board of Directors may be filled by the affirmative vote of a
majority of the remaining directors then in office or, if not filled by the
directors, by the shareholders.

The Restated Articles provide that in discharging the duties of their
respective positions and in determining what is believed to be in the best
interest of the Company, the Board of Directors, any committee of the Board of
Directors and any individual director, in addition to considering the effects of
any action on the Company or its shareholders, may, to the extent permitted by
applicable Georgia law, in his or her sole discretion, consider the interests of
the employees, customers, suppliers and creditors of the Company and its
subsidiaries, the communities in which offices or other establishments of the
Company and its subsidiaries are located and all other factors such director(s)
may consider pertinent; provided, however, that this provision of the Restated
Articles solely grants discretionary authority to the directors, and no
constituency shall be deemed to have been given any right to consideration
thereby.

The preceding provisions of the Restated Articles may be changed only upon
the affirmative vote of holders of at least 66 2/3% of the total number of the
then outstanding shares of capital stock of the Company that are entitled to
vote generally in the election of directors, voting together as a single class.

The provisions of the Restated Articles and Restated Bylaws summarized in
the preceding seven paragraphs and the provisions of the GBCC described under
"Certain Provisions of Georgia Law," contain provisions that may have the effect
of delaying, deferring or preventing a non-negotiated merger or other business
combination involving the Company. These provisions are intended to encourage
any person interested in acquiring the Company to negotiate with and obtain the
approval of the Board of Directors in connection with the transaction. Certain
of these provisions may, however, discourage a future acquisition of the Company
not approved by the Board of Directors in which shareholders might receive an
attractive value for their shares or that a substantial number or even a
majority of the Company's shareholders might believe to be in their best
interest. As a result, shareholders who desire to participate in such a
transaction may not have the opportunity to do so. Such provisions could also
discourage bids for the Common Stock at a premium, as well as create a
depressive effect on the market price of the Common Stock.

CERTAIN PROVISIONS OF GEORGIA LAW

Georgia Business Combination Statute. The Company has elected in its
Restated Bylaws to be subject to provisions of the GBCC prohibiting various
"business combinations" involving "interested shareholders" for a period of five
years after the shareholder becomes an interested shareholder of the Company.
Such provisions prohibit any business combination with an interested shareholder
unless either (i) prior to such time, the Board of Directors approves either the
business combination or the transaction by which such
47
<PAGE> 49

shareholder became an interested shareholder, (ii) in the transaction that
resulted in the shareholder becoming an interested shareholder, the interested
shareholder became the beneficial owner of at least 90% of the outstanding
voting stock of the Company that was not held by directors, officers, affiliates
thereof, subsidiaries or certain employee stock option plans of the Company, or
(iii) subsequent to becoming an interested shareholder, such shareholder
acquired additional shares resulting in such shareholder owning at least 90% of
the outstanding voting stock of the Company and the business combination is
approved by a majority of the disinterested shareholders' shares not held by
directors, officers, affiliates thereof, subsidiaries or certain employee stock
option plans of the Company. Under the relevant provisions of the GBCC, a
"business combination" is defined to include, among other things, (i) any
merger, consolidation, share exchange or any sale, transfer or other disposition
(or series of related sales or transfers) of assets of the Company having an
aggregate book value of 10% or more of the Company's net assets (measured as of
the end of the most recent fiscal quarter), with an interested shareholder of
the Company or any other corporation which is or, after giving effect to such
business combination, becomes an affiliate of any such interested shareholder,
(ii) the liquidation or dissolution of the Company, (iii) the receipt by an
interested shareholder of any benefit from any loan, advance, guarantee, pledge,
tax credit or other financial benefit from the Company, other than in the
ordinary course of business, and (iv) certain other transactions involving the
issuance or reclassification of securities of the Company which produce the
result that 5% or more of the total equity shares of the Company, or of any
class or series thereof, is owned by an interested shareholder. An "interested
shareholder" is defined by the GBCC to include any person or entity that,
together with its affiliates, beneficially owns or has the right to own 10% or
more of the outstanding voting shares of the Company, or any person that is an
affiliate of the Company and has, at any time within the preceding two-year
period, been the beneficial owner of 10% or more of the outstanding voting
shares of the Company. The restrictions on business combinations shall not apply
to any person who was an interested shareholder before the adoption of the bylaw
provision that made the provisions applicable to the Company nor to any persons
who subsequently become interested shareholders inadvertently, subsequently
divest sufficient shares so that the shareholder ceases to be an interested
shareholder and would not, at any time within the five-year period immediately
before a business combination involving the shareholder, have been an interested
shareholder but for the inadvertent acquisition.

Georgia Fair Price Statute. The Company has elected in its Restated Bylaws
to be subject to the "Fair Price" provisions of the GBCC. These provisions
require that a "business combination" with an "interested shareholder" be (a)
unanimously approved by "continuing directors" who must constitute at least
three members of the Board of Directors at the time of such approval, or (b)
recommended by at least two-thirds of the "continuing directors" and approved by
a majority of the shareholders excluding the "interested shareholder," unless
certain standards regarding the consideration paid to shareholders in the
transaction are met. Subject to certain exceptions, a "business combination"
includes (i) any merger or consolidation of the corporation or a subsidiary of
the Company, (ii) any share exchange, (iii) any sale, lease, transfer, or other
disposition of assets of the Company or its subsidiary occurring within a
12-month period and having an aggregate book value equal to 10% or more of the
net assets of the Company, (iv) any transaction that results in the issuance or
transfer by the Company of any stock of the Company or the subsidiary
representing 5% or more of the total market value of the outstanding stock of
the Company to any interested shareholder within a 12-month period, except
pursuant to a transaction that effects a pro rata distribution to all
shareholders of the Company, (v) the adoption of any plan or proposal for the
liquidation or dissolution of the corporation in which anything other than cash
will be received by an interested shareholder, and (vi) any transaction
occurring within a 12-month period involving the Company or a subsidiary of the
Company that has the effect of increasing by 5% or more the proportionate share
of the stock of any class or series of the Company or the subsidiary that is
directly or beneficially owned by the interested shareholder. An "interested
shareholder" is defined the same as it is defined in the Georgia Business
Combination Statute. A "continuing director" includes any director who is not an
affiliate or associate of an interested shareholder or any Board-approved
successor of such a director who is not an affiliate or associate of an
interested shareholder.

The Fair Price provisions do not restrict a business combination if: (a)
the aggregate amount of the cash, and fair market value of any non-cash
property, measured five days before the consummation date, to be received per
share by the shareholders is at least equal to the highest of: (i) the highest
per share price,
48
<PAGE> 50

including brokerage commissions, transfer taxes, and soliciting dealers' fees,
paid by the interested shareholder for any shares of the same class or series
acquired by it within two years preceding the announcement date or in the
transaction in which it became an interested shareholder, (ii) the higher of the
fair market value per share as determined on the announcement date or the
determination date, or (iii) in the case of shares other than Common Stock, the
highest amount per share to which preferred shareholders are entitled in the
event of liquidation, dissolution, or winding up of the corporation, provided
that subparagraph (iii) shall only be applicable if the interested shareholder
acquired the shares within the two-year period immediately preceding the
announcement date; and (b) shareholders receive cash or the form of
consideration used in the past by the interested shareholder to purchase the
largest number of shares of such class or series. Further, subject to
exceptions, prior to the time the business combination with the interested
shareholder takes place, without the approval of the Board of Directors, there
must have been: (i) no failure to declare and pay full dividends on the
Company's outstanding Preferred Stock, (ii) no reduction in the annual rate of
dividends paid on common shares except as to reflect any subdivision of the
shares, (iii) an increase in the annual rate of dividends to reflect any
reclassification of shares, and (iv) not more than a 1% increase in the
interested shareholder's ownership of any of the Company's capital stock in any
12-month period. An interested shareholder may not receive a direct or indirect
benefit, except proportionately as a shareholder, of any loans, advances,
guarantees, pledges, or other financial assistance or any tax credits or other
tax advantages provided by the corporation or its subsidiaries, either in
anticipation of or in connection with such business combination or otherwise.

LISTING

Application has been made to include the Company's Common Stock on the
Nasdaq National Market under the trading symbol "EIII."

TRANSFER AGENT AND REGISTRAR

The transfer agent for the Company's Common Stock is SunTrust Bank,
Atlanta, located in Atlanta, Georgia.

49
<PAGE> 51

SHARES ELIGIBLE FOR FUTURE SALE

Prior to the Offering, there has been no public market for the securities
of the Company.

Upon completion of the Offering, the Company will have outstanding
shares of Common Stock (assuming no exercise of the Underwriters'
over-allotment option or options currently outstanding). Of these shares, the
shares sold in the Offering will be freely tradable without
restriction or further registration under the Securities Act, unless they are
purchased by "affiliates" of the Company as that term is defined in Rule 144
under the Securities Act (which sales would be subject to certain limitations
and restrictions described below). The remaining shares of Common
Stock may be sold in the public market only if registered or pursuant to an
exemption from registration, such as Rule 144 promulgated under the Securities
Act. The holders of all remaining shares have agreed not to
offer, sell, contract to sell, grant any option to purchase or otherwise dispose
of, or agree to dispose of, any shares of Common Stock until 180 days after the
date of this Prospectus without the prior written consent of UBS Securities LLC.
See "Underwriting." UBS Securities LLC, in its sole discretion and without
notice, may earlier release for sale in the public market all or any portion of
the shares subject to the lock-up agreements.

In general, under Rule 144 as currently in effect, beginning 90 days after
the date of this Prospectus, a person (or persons whose shares are aggregated)
who has beneficially owned shares for at least one year (including the holding
period of any prior owner except an affiliate) is entitled to sell in "brokers'
transactions" or to market makers, within any three-month period, a number of
shares that does not exceed the greater of: (i) one percent of the number of
shares of Common Stock then outstanding (approximately shares
immediately after the Offering) or (ii) the average weekly trading volume in the
Common Stock during the four calendar weeks preceding the required filing of a
Form 144 with respect to such sale. Sales under Rule 144 are subject to the
availability of current public information about the Company. Under Rule 144(k),
a person who is not deemed to have been an affiliate of the Company at any time
during the 90 days preceding a sale, and who has beneficially owned the shares
proposed to be sold for at least two years, is entitled to sell such shares
without having to comply with the manner of sale, public information, volume
limitation or notice filing provisions of Rule 144 and, unless otherwise
restricted, may therefore sell such shares immediately upon the completion of
the Offering. Under Rule 701 under the Securities Act, persons who purchase
shares upon exercise of options granted prior to the Offering are entitled to
sell such shares 90 days after the Offering in reliance on Rule 144, without
having to comply with the holding period requirements of Rule 144 and, in the
case of non-affiliates, without having to comply with the volume limitation or
notice filing provisions of Rule 144.

After the expiration of the 180-day lock-up period, shares,
including the shares offered hereby or the shares which may be purchased upon
the exercise of options then exercisable, will be eligible for sale in the
public market subject, in some cases, to compliance with Rule 144 or Rule 701.
The Company is unable to estimate accurately the number of "restricted" shares
that will be sold under Rule 144 since this will depend in part on the market
price for the Common Stock, the personal circumstances of the seller and other
factors. See "Risk Factors -- Shares Eligible for Future Sale."

After the completion of the Offering, the Company intends to file
Registration Statements on Form S-8 under the Securities Act to register the
3,000,000 shares of Common Stock reserved for issuance under the Company's Stock
Incentive Plan, as well as the shares reserved for issuance upon exercise of
options to purchase an additional 148,354 shares of Common Stock granted other
than pursuant to such plan. After the date of such filing (if not otherwise
subject to a lock-up agreement), shares purchased pursuant to such options
generally would be available for resale in the public market. The Company has
granted options to purchase an aggregate of 1,047,273 shares, of which no
options are currently exercisable. See "Management -- Stock Option and Other
Compensation Plans."

50
<PAGE> 52

UNDERWRITING

Subject to the terms and conditions contained in the Underwriting Agreement
to be entered into in connection with the Offering, the Underwriters named below
(the "Underwriters"), for whom UBS Securities LLC, SBC Warburg Dillon Read Inc.
and SoundView Financial Group, Inc. are acting as Representatives (the
"Representatives"), have agreed to purchase from the Company and the Selling
Shareholders the following respective number of shares of Common Stock:

<TABLE>
<CAPTION>
NUMBER
UNDERWRITERS OF SHARES
- ------------ ---------
<S> <C>
UBS Securities LLC..........................................
SBC Warburg Dillon Read Inc.................................
SoundView Financial Group, Inc..............................

-------
Total.............................................
=======
</TABLE>

The Underwriting Agreement provides that the obligations of the several
Underwriters are subject to certain conditions precedent, including the absence
of any material adverse change in the Company's business and the receipt of
certain certificates, opinions and letters from the Company and its counsel. The
nature of the Underwriters' obligation is such that they are committed to
purchase all shares of Common Stock offered hereby if any such shares are
purchased. The Underwriting Agreement contains certain provisions whereby, if
any Underwriter defaults in its obligation to purchase shares, and the aggregate
obligations of the Underwriters so defaulting do not exceed 10% of the shares
offered hereby, the remaining Underwriters, or some of them, must assume such
obligations.

The Representatives have advised the Company and the Selling Shareholders
that the Underwriters propose to offer the shares of Common Stock directly to
the public at the public offering price set forth on the cover page of this
Prospectus, and to certain dealers, at such price less a concession not in
excess of $ per share. The Underwriters may allow, and such dealers may
reallow, a concession not in excess of $ per share to other Underwriters or
to certain other dealers. After the public offering of the shares of Common
Stock, the offering price and other selling terms may be changed by the
Underwriters.

The Company and the Selling Shareholders have granted to the Underwriters
an option, exercisable no later than 30 days after the date of this Prospectus,
to purchase up to a total of additional shares of Common Stock to
cover over-allotments, if any, at the public offering price set forth on the
cover page of this Prospectus, less the underwriting discounts and commissions.
To the extent that the Underwriters exercise such option, each of the
Underwriters will become obligated, subject to certain conditions, to purchase
approximately the same percentage of such additional shares as the number of
shares of Common Stock set forth next to such Underwriter's name in the
preceding table bears to the total number of shares of Common Stock offered
hereby. The Company and the Selling Shareholders will be obligated, pursuant to
the option, to sell such shares to the Underwriters to the extent the option is
exercised.

The Company and the Selling Shareholders have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act, and to contribute to payments the Underwriters may be required
to make in respect thereof.

The executive officers, directors, Selling Shareholders and certain other
shareholders of the Company have agreed that they will not, without the prior
written consent of UBS Securities LLC, offer, sell or otherwise dispose of any
shares of Common Stock, options or warrants to acquire shares of Common Stock or
securities exchangeable for or convertible into shares of Common Stock for a
period of 180 days after the date of the Underwriting Agreement. The Company has
agreed that it will not, without the prior written consent of UBS Securities
LLC, offer, sell or otherwise dispose of any shares of Common Stock, options or
warrants to acquire shares of Common Stock or securities exchangeable for or
convertible into shares of Common Stock during
51
<PAGE> 53

the 180-day period following the date of this Prospectus, except that the
Company may issue shares upon the exercise of options granted prior to the date
hereof, and may grant additional options under its Stock Incentive Plan,
provided that, without the prior written consent of UBS Securities LLC, such
additional options shall not be exercisable during such period. See "Shares
Eligible for Future Sale."

In connection with the Offering and in compliance with applicable law
including Regulation M, the Underwriters may over-allot or effect transactions
which stabilize, maintain or otherwise affect the market price of the Common
Stock at levels above those which might otherwise prevail in the open market,
including by entering stabilizing bids, effecting syndicate covering
transactions or imposing penalty bids. A stabilizing bid means the placing of
any bid, or the effecting of any purchase, for the purpose of pegging, fixing or
maintaining the price of a security. A syndicate covering transaction means the
placing of any bid on behalf of the underwriting syndicate or the effecting of
any purchase to reduce a short position created in connection with the Offering.
A penalty bid means an arrangement that permits UBS Securities LLC, as managing
underwriter, to reclaim a selling concession from a syndicate member in
connection with the Offering when the shares of Common Stock originally sold by
the syndicate member are purchased in syndicate covering transactions. Such
transactions may be effected on the Nasdaq National Market or otherwise. The
Underwriters are not required to engage in any of these activities. Any such
activities, if commenced, may be discontinued at any time.

In connection with the Offering, certain Underwriters, who are qualified
registered market makers on the Nasdaq National Market, may engage in passive
market making on Nasdaq in accordance with Rule 103 of Regulation M under the
Securities Exchange Act of 1934, as amended. The passive market making
transactions must comply with applicable volume and price limits and be
identified as such. In general, a passive market maker must display its bid at a
price not in excess of the highest independent bid for such security; if all
independent bids are lowered before the passive market maker's bid, however,
such bid must then be lowered when certain purchase limits are exceeded. Passive
market making may stabilize the market price of the Common Stock above
independent market level and, if commenced, may be discontinued at any time.

The Representatives have advised the Company that the Underwriters do not
intend to confirm sales to any account over which they exercise discretionary
authority in excess of five percent of the number of shares of Common Stock
offered hereby.

52
<PAGE> 54

LEGAL MATTERS

The validity of the issuance of the shares of the Common Stock offered
hereby will be passed upon for the Company and the Selling Shareholders by
Morris, Manning & Martin, L.L.P., Atlanta, Georgia. Certain legal matters in
connection with the Offering will be passed upon for the Underwriters by
Brobeck, Phleger & Harrison LLP, Austin, Texas.

EXPERTS

The Consolidated Financial Statements of E3 Corporation as of December 31,
1996 and 1997, and for each of the three years in the period ended December 31,
1997, appearing in this Prospectus and Registration Statement have been audited
by Ernst & Young LLP, independent auditors, as set forth in their report thereon
appearing elsewhere herein, and are included in reliance upon such report given
upon the authority of such firm as experts in accounting and auditing.

ADDITIONAL INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-1 (together with all
amendments, schedules and exhibits thereto, the "Registration Statement") under
the Securities Act with respect to the shares of Common Stock offered hereby.
This Prospectus, which constitutes a part of the Registration Statement, does
not contain all of the information set forth in the Registration Statement,
certain parts of which are omitted in accordance with the rules and regulations
of the Commission. For further information with respect to the Company and the
Common Stock offered hereby, reference is made to the Registration Statement.
Statements made in this Prospectus as to the contents of any contract, agreement
or other document are not necessarily complete, and in each instance, reference
is made to the copy of such contract or other document filed as an exhibit to
the Registration Statement, each such statement being qualified in all respects
by such reference. The Registration Statement and the exhibits and schedules
thereto may be inspected without charge at the public reference facilities
maintained by the Commission in Room 1024, 450 Fifth Street, N. W., Washington,
D.C. 20549, and at the following regional offices of the Commission: Seven World
Trade Center, Room 1400, New York, New York 10048 and Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of
such material can be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, Room 1024, at
prescribed rates. In addition, the Company is required to file electronic
versions of these documents with the Commission through the Commissions'
Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system. The
Commission maintains a World Wide Web site at http://www.sec.gov that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the Commission. Information concerning
the Company is also available for inspection at the offices of the Nasdaq
National Market, Reports Section, 1735 K Street, N.W., Washington, D.C. 20006.

The Company intends to furnish to its shareholders annual reports
containing consolidated financial statements audited by an independent public
accounting firm and quarterly reports for the first three quarters of each
fiscal year containing unaudited consolidated financial information.

53
<PAGE> 55

E3 CORPORATION

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Report of Independent Auditors.............................. F-2
Consolidated Balance Sheets as of December 31, 1996 and 1997
and March 31, 1998 (Unaudited)............................ F-3
Consolidated Statements of Income for years ended December
31, 1995, 1996 and 1997 and the Three-Month Periods ended
March 31, 1997 and 1998 (Unaudited)....................... F-4
Consolidated Statements of Shareholders' Equity for years
ended December 31, 1995, 1996 and 1997 and the Three-Month
Period ended March 31, 1998 (Unaudited)................... F-5
Consolidated Statements of Cash Flows for years ended
December 31, 1995, 1996 and 1997 and the Three-Month
Periods ended March 31, 1997 and 1998 (Unaudited)......... F-6
Notes to Consolidated Financial Statements.................. F-7
</TABLE>

F-1
<PAGE> 56

REPORT OF INDEPENDENT AUDITORS

The Board of Directors and Shareholders
E3 Corporation

We have audited the accompanying consolidated balance sheets of E3
Corporation as of December 31, 1996 and 1997, and the related consolidated
statements of income, shareholders' equity and cash flows for each of the three
years in the period ending December 31, 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of E3 Corporation
at December 31, 1996 and 1997, and the consolidated results of its operations
and its cash flows for each of the three years in the period ended December 31,
1997 in conformity with generally accepted accounting principles.

ERNST & YOUNG LLP

Atlanta, Georgia
February 13, 1998, except for Note 10,
as to which the date is May 14, 1998

F-2
<PAGE> 57

E3 CORPORATION

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------- MARCH 31,
1996 1997 1998
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents............................ $ 4,575,424 $ 7,318,181 $ 9,247,629
Accounts receivable, net of allowances of $190,000
and $590,000 in 1996 and 1997, respectively....... 6,545,720 6,486,129 5,285,808
Accounts receivable from employees................... 76,815 16,378 --
Prepaid expenses and other current assets............ 262,780 212,180 128,115
Deferred income taxes................................ 307,542 495,692 495,692
----------- ----------- -----------
Total current assets......................... 11,768,281 14,528,560 15,157,244
Property and equipment:
Furniture and equipment.............................. 1,679,757 2,157,940 2,289,122
Purchased software................................... 235,100 212,856 217,295
Leasehold improvements............................... 351,624 412,489 425,399
----------- ----------- -----------
2,266,481 2,783,285 2,931,816
Less accumulated depreciation and amortization....... (1,092,819) (1,524,883) (1,659,647)
----------- ----------- -----------
1,173,662 1,258,402 1,272,169
Other assets........................................... 37,599 37,256 89,876
----------- ----------- -----------
Total assets................................. $12,979,542 $15,824,218 $16,519,289
=========== =========== ===========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable..................................... $ 983,206 $ 299,338 $ 368,227
Accrued expenses..................................... 1,267,446 1,555,960 1,674,385
Accrued bonuses...................................... -- 680,000 --
Accrued commissions.................................. 424,808 553,649 172,248
Income taxes payable................................. 578,437 515,769 1,049,271
Deferred revenue..................................... 4,603,032 5,350,677 5,574,727
----------- ----------- -----------
Total current liabilities.................... 7,856,929 8,955,393 8,838,858
Deferred income taxes.................................. 32,343 30,400 30,400
Commitments
Shareholders' equity:
Common stock, par value $.05 per share, authorized
50,000,000 shares, issued 15,987,550 at December
31, 1996 and 15,649,350 shares at December 31,
1997 and March 31, 1998 (unaudited)............... 799,378 782,468 782,468
Retained earnings.................................... 4,343,169 6,236,676 7,053,506
Other comprehensive income (loss).................... 24,866 (180,719) (185,943)
----------- ----------- -----------
5,167,413 6,838,425 7,650,031
Less: Treasury stock -- 338,200 shares at December
31, 1996.......................................... (77,143) -- --
----------- ----------- -----------
Total shareholders' equity................... 5,090,270 6,838,425 7,650,031
----------- ----------- -----------
Total liabilities and shareholders' equity... $12,979,542 $15,824,218 $16,519,289
=========== =========== ===========
</TABLE>

See accompanying notes to consolidated financial statements.

F-3
<PAGE> 58

E3 CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
--------------------------------------- -----------------------
1995 1996 1997 1997 1998
----------- ----------- ----------- ---------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenue:
Software license fees.......... $11,199,140 $12,588,646 $14,518,779 $5,185,274 $4,107,170
Services and maintenance
fees........................ 5,044,295 7,200,332 10,342,595 2,350,715 3,392,265
----------- ----------- ----------- ---------- ----------
Total revenue.......... 16,243,435 19,788,978 24,861,374 7,535,989 7,499,435
Expenses:
Cost of services and
maintenance fees............ 3,035,540 5,039,624 5,995,554 1,141,055 1,503,943
Sales and marketing............ 3,684,206 4,862,333 7,468,710 1,711,013 2,291,211
General and administrative..... 4,192,920 3,562,370 4,553,113 852,540 1,478,932
Product development............ 2,413,721 2,586,411 3,171,316 678,505 718,122
----------- ----------- ----------- ---------- ----------
Total expenses......... 13,326,387 16,050,738 21,188,693 4,383,113 5,992,208
----------- ----------- ----------- ---------- ----------
Income from operations........... 2,917,048 3,738,240 3,672,681 3,152,876 1,507,227
Interest income, net............. 92,633 97,642 200,000 28,619 59,697
Other income (expense), net...... 23,749 6,383 (39,310) -- (52,776)
----------- ----------- ----------- ---------- ----------
116,382 104,025 160,690 28,619 6,921
----------- ----------- ----------- ---------- ----------
Income before income taxes....... 3,033,430 3,842,265 3,833,371 3,181,495 1,514,148
Provision for income taxes....... 974,978 1,581,680 1,575,307 1,307,431 620,802
----------- ----------- ----------- ---------- ----------
Net income....................... $ 2,058,452 $ 2,260,585 $ 2,258,064 $1,874,064 $ 893,346
=========== =========== =========== ========== ==========
Net income per common
share -- basic and diluted..... $ 0.13 $ 0.14 $ 0.14 $ 0.12 $ 0.06
=========== =========== =========== ========== ==========
</TABLE>

See accompanying notes to consolidated financial statements.

F-4
<PAGE> 59

E3 CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
OTHER TOTAL
COMMON RETAINED COMPREHENSIVE TREASURY SHAREHOLDERS'
STOCK EARNINGS INCOME (LOSS) STOCK EQUITY
-------- ---------- ------------- -------- -------------
<S> <C> <C> <C> <C> <C>
Balances at December 31, 1994......... $794,675 $ 917,310 $ (6,535) $(77,143) $1,628,307
Net income.......................... -- 2,058,452 -- -- 2,058,452
Dividends -- $.039 per share........ -- (605,092) -- -- (605,092)
Foreign currency translation
adjustments...................... -- -- 10,153 -- 10,153
-------- ---------- --------- -------- ----------
Balances at December 31, 1995......... 794,675 2,370,670 3,618 (77,143) 3,091,820
Net income.......................... -- 2,260,585 -- -- 2,260,585
Dividends -- $.019 per share........ -- (303,858) -- -- (303,858)
Issuance of common stock............ 4,703 15,772 -- -- 20,475
Foreign currency translation
adjustments...................... -- -- 21,248 -- 21,248
-------- ---------- --------- -------- ----------
Balances at December 31, 1996......... 799,378 4,343,169 24,866 (77,143) 5,090,270
Net income.......................... -- 2,258,064 -- -- 2,258,064
Dividends -- $.019 per share........ -- (304,324) -- -- (304,324)
Retirement of treasury stock........ (16,910) (60,233) -- 77,143 --
Foreign currency translation
adjustments...................... -- -- (205,585) -- (205,585)
-------- ---------- --------- -------- ----------
Balances at December 31, 1997......... 782,468 6,236,676 (180,719) -- 6,838,425
Net income (unaudited).............. -- 893,346 -- -- 893,346
Dividends -- $.005 per share
(unaudited)...................... -- (76,516) -- -- (76,516)
Foreign currency translation
adjustments (unaudited).......... -- -- (5,224) -- (5,224)
Balances at March 31, 1998
(unaudited)......................... $782,468 $7,053,506 $(185,943) $ -- $7,650,031
======== ========== ========= ======== ==========
</TABLE>

See accompanying notes to consolidated financial statements.

F-5
<PAGE> 60

E3 CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
--------------------------------------- -------------------------
1995 1996 1997 1997 1998
----------- ----------- ----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net income........................ $ 2,058,452 $ 2,260,585 $ 2,258,064 $ 1,874,064 $ 893,346
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation and
amortization............... 268,888 361,775 460,864 99,419 134,764
Provision for doubtful
accounts................... 2,010 42,453 400,000 19,439 --
Provision for deferred
taxes...................... (409,842) 249,432 (190,093) -- --
Changes in operating assets
and liabilities:
Accounts receivable........ (2,661,350) (1,342,082) (380,897) 287,033 1,200,321
Accounts receivable from
employees............... (7,434) (37,247) 41,730 (7,950) 16,378
Prepaid expenses and other
current assets.......... (133,614) (278,926) 264,045 106,568 84,065
Other assets............... (52,634) 15,044 342 (59,110) (52,620)
Accounts payable........... 1,274,423 (172,485) (684,018) (29,971) 68,889
Accrued expenses........... 134,108 452,766 266,630 (846,882) 118,425
Accrued bonuses............ -- -- 680,000 280,000 (680,000)
Accrued commissions........ 77,930 (179,106) 128,841 153,020 (381,401)
Income taxes payable....... (466,064) 435,247 (209,089) 816,353 533,502
Deferred revenue........... 1,618,556 206,918 754,078 (1,449,291) 224,050
Deferred rent.............. (125,115) -- -- -- --
----------- ----------- ----------- ----------- -----------
Net cash provided by
operating
activities............ 1,578,314 2,014,374 3,790,497 1,242,692 2,159,719
----------- ----------- ----------- ----------- -----------
INVESTING ACTIVITIES
Purchases of equipment............ (709,923) (612,070) (634,906) (124,493) (148,531)
----------- ----------- ----------- ----------- -----------
Net cash used in
investing
activities............ (709,923) (612,070) (634,906) (124,493) (148,531)
----------- ----------- ----------- ----------- -----------
FINANCING ACTIVITIES
Payments of dividends............. (605,092) (303,858) (304,324) (75,637) (76,516)
Issuance of common stock.......... -- 20,475 -- -- --
----------- ----------- ----------- ----------- -----------
Net cash used in
financing
activities............ (605,092) (283,383) (304,324) (75,637) (76,516)
----------- ----------- ----------- ----------- -----------
Effect of exchange rate
fluctuations on cash............ 55,717 3,232 (108,510) (4,362) (5,224)
----------- ----------- ----------- ----------- -----------
Increase in cash.................. 319,016 1,122,153 2,742,757 1,038,200 1,929,448
Cash at beginning of period....... 3,134,255 3,453,271 4,575,424 4,575,424 7,318,181
----------- ----------- ----------- ----------- -----------
Cash at end of period............. $ 3,453,271 $ 4,575,424 $ 7,318,181 $ 5,613,624 $ 9,247,629
=========== =========== =========== =========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH
FLOW INFORMATION
Cash paid during the period for
income taxes.................... $ 1,859,710 $ 1,217,800 $ 1,340,621 $ -- $ --
=========== =========== =========== =========== ===========
</TABLE>

See accompanying notes to consolidated financial statements.

F-6
<PAGE> 61

E3 CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DESCRIPTION OF BUSINESS

E3 Corporation (the "Company") develops and markets inventory management
software and provides related consulting, education and maintenance services
principally in the United States and in western Europe through its subsidiaries
in France, Germany, Sweden, the United Kingdom and Italy. In January 1998, the
Company changed its name to E3 Corporation from Technology Investment Leasing &
Loan, Inc. and changed the name of its United States subsidiary to E3 North
America, Inc. from E3 Associates, Ltd.

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements of E3 Corporation include the
accounts of E3 Corporation and its subsidiaries, E3 North America, Inc., E3
Norden AB, E3 (Deutschland) GmbH, E3 France S.A., E3 United Kingdom, Ltd. and E3
Italia S.R.L., collectively "E3", and the accounts of Inventory Management
Institute, Inc. ("IMI"), all collectively referred to as the "Company." All
significant intercompany accounts and transactions have been eliminated.

USE OF ESTIMATES

The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results inevitably will differ from those estimates,
and such differences may be material to the financial statements.

EARNINGS PER SHARE

Earnings per share has been calculated following Statement of Financial
Accounting Standards No. 128, "Earnings per Share" ("SFAS 128"). Basic earnings
per share is computed by dividing net income by weighted average shares
outstanding and does not include potentially dilutive securities. Diluted
earnings per share is computed by dividing net income by weighted average shares
outstanding, including potentially dilutive securities using the treasury stock
method based on the average stock price for the period. Outstanding stock
purchase options had no impact for any of the periods reported as the exercise
price of the options exceeded management's estimate of the average fair value
per share for each period.

In February 1998 the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin No. 98 ("SAB 98"). Under the guidance of SAB 98 the
Company had no "nominal issuances." Therefore, application of SAB 98 had no
impact on the earnings per share calculation.

F-7
<PAGE> 62
E3 CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The following table sets forth the computation of basic and diluted
earnings per share:

REVENUE RECOGNITION

During 1995, 1996 and 1997, the Company recognized revenue in accordance
with AICPA Statement of Position 91-1, "Software Revenue Recognition." Revenue
from the licensing of computer software is recognized when collectibility is
assessed as probable, there are no significant remaining obligations, and the
software has been delivered. Revenue from consulting and education services is
recognized at the time services are performed. Revenue from customer use fees
(maintenance fees) is recognized ratably over the period of the agreements.

In October 1997 the American Institute of Certified Public Accountants
("AICPA") issued Statement of Position ("SOP") 97-2 "Software Revenue
Recognition," as amended by SOP 98-4, which supersedes SOP 91-1 and is effective
for transactions entered into for fiscal years beginning after December 31,
1997. While some principles remain the same, there are several key differences
between the two pronouncements, including accounting for multiple element
arrangements. The Company adopted SOP 97-2 effective January 1, 1998 for
transactions entered into during the first quarter ended March 31, 1998. There
was no material financial impact due to the adoption of 97-2 as the separate
elements of multiple element contracts have been separately priced; contracts
generally have not required significant production, modification or
customization of software; and service elements have not been considered
essential to the functionality of software delivered and are recognized
separately as services are performed.

Deferred revenue represents payments received prior to delivery of the
related products or services.

COMPUTER SOFTWARE

Research and development costs are expensed as incurred. Capitalization of
software development costs does not commence until technological feasibility of
the product is established and ceases when the product is available for general
release to customers. The Company did not capitalize any software development
costs in 1995, 1996 or 1997.

F-8
<PAGE> 63
E3 CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

CASH AND CASH EQUIVALENTS

The Company considers all liquid investments with a maturity of three
months or less when purchased to be cash equivalents. Cash equivalents are
stated at cost, which approximates fair market value.

PROPERTY AND EQUIPMENT

Property and equipment is stated at cost. Depreciation is provided over the
estimated useful lives of the related assets (furniture and equipment -- 5
years, purchased software -- 3 years, leasehold improvements -- life of lease)
using the straight-line method for financial reporting purposes.

ADVERTISING EXPENSE

The cost of advertising is expensed as incurred. The Company incurred
approximately $161,000, $291,000 and $661,000 in advertising costs during 1995,
1996 and 1997, respectively.

STOCK BASED COMPENSATION

The Company accounts for stock option grants in accordance with APB Opinion
No. 25, "Accounting for Stock Issued to Employees" ("APB 25"), and, accordingly,
recognizes no compensation expense for stock options with fixed terms and
exercise prices equal to or greater than fair value at the date of grant.
Compensation expense is recognized for increases in the estimated fair value of
common stock for stock options with variable terms. In October 1995, the FASB
issued Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation" ("SFAS 123"), which provides an alternative to APB 25
in accounting for stock-based compensation issued to employees. However, the
Company continues to account for stock-based compensation in accordance with APB
25.

IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

In June 1997 the FASB issued Statement of Financial Accounting Standards
No. 130, "Reporting Comprehensive Income" ("SFAS 130"). SFAS 130 requires that
all items that are required to be recognized under accounting standards as
components of comprehensive income be reported in a financial statement that is
displayed with the same prominence as other financial statements. SFAS 130
requires that an enterprise classify items of other comprehensive income by
their nature in a financial statement and display the accumulated balance of
other comprehensive income separately from retained earnings and additional
paid-in capital in the equity section of the statement of financial position.
SFAS 130 is effective for fiscal years beginning after December 15, 1997. The
Company adopted SFAS 130 as of January 1, 1998 and all prior periods have been
restated to conform with the requirements of SFAS 130. There was no impact on
previously reported net income, total assets or shareholders' equity as a result
of adopting SFAS 130.

In June 1997 the FASB issued Statement of Financial Accounting Standards
No. 131, "Disclosures about Segments of an Enterprise and Related Information"
("SFAS 131"). SFAS 131 requires that a public business enterprise report
financial and descriptive information about its reportable operating segments.
Operating segments are components of an enterprise about which separate
financial information is available that is evaluated regularly by the chief
operating decision maker in deciding how to allocate resources and in assessing
performance.

SFAS 131 requires reporting segment profit or loss, certain specific
revenue and expense items, and segment assets. It requires reconciliations of
total segment revenues, total segment profit or loss, total segment assets, and
other amounts disclosed for segments to corresponding amounts in the
enterprise's general-purpose financial statements. It requires that all public
business enterprises report information about the revenues derived from the
enterprise's products or services (or groups of similar products and services),
about the countries in which the enterprise earns revenues and holds assets, and
about major customers regardless of
F-9
<PAGE> 64
E3 CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

whether that information is used in making operating decisions. SFAS 131 is
effective for financial statements for annual periods beginning after December
15, 1997. In the initial year of application, comparative information for
earlier years is to be restated. The Company intends to adopt the provisions of
SFAS 131 in 1998 and does not expect their application to have a material impact
on the financial position or results of operations of the Company.

UNAUDITED INTERIM FINANCIAL STATEMENTS

The unaudited interim financial statements include all adjustments,
consisting only of normal recurring accruals, which the Company considers
necessary for fair presentation of the financial position of the Company as of
March 31, 1998 and the results of operation for the quarters ended March 31,
1997 and 1998, as presented in the accompanying unaudited interim financial
statements.

RECLASSIFICATIONS

Certain amounts within the 1995 and 1996 financial statements have been
reclassified to conform to the 1997 presentation.

2. FINANCIAL INSTRUMENTS

CONCENTRATIONS OF CREDIT RISK

Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist principally of cash and cash equivalents
and trade accounts receivable.

At December 31, 1997, approximately $4,600,000 of cash is deposited in two
United States financial institutions. Credit risk is subject to the financial
security of the institutions. In addition, approximately $2,700,000 of the
December 31, 1997 cash and cash equivalents balance is held in financial
institutions in western Europe and is subject to the financial security of the
institutions.

Accounts receivable are unsecured and due under stated terms. Credit risk
with respect to trade accounts receivable is subject to the financial security
of each customer. The Company does not require collateral. Receivables generally
are due within 30 days, and management records estimates of expected credit
losses and returns of products sold.

In addition, the foreign subsidiaries carry their cash, accounts receivable
and accounts payable in foreign currencies. Net assets, excluding intercompany
balances, of the Company's foreign subsidiaries included in the Company's
consolidated financial statements totaled approximately $3,300,000 at December
31, 1997. Revenue of the foreign subsidiaries totaled approximately $7,400,000
in 1997.

FAIR VALUE

The carrying amount reported in the balance sheet approximates the fair
value for cash and cash equivalents, accounts receivable and accounts payable.

3. LEASES

The Company leases certain office space and certain office equipment under
noncancellable operating leases with initial or remaining terms of one year or
more. Rent expense under all operating leases was approximately $1,258,000,
$1,264,000 and $1,023,000 in 1995, 1996 and 1997, respectively.

F-10
<PAGE> 65
E3 CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Future minimum annual rental payments at December 31, 1997 under these
noncancelable leases are as follows:

<TABLE>
<CAPTION>
U.S. EUROPE TOTAL
---------- ---------- ----------
<S> <C> <C> <C>
1998............................................... $ 793,253 $ 246,601 $1,039,854
1999............................................... 714,998 209,762 924,760
2000............................................... 586,435 272,553 858,988
2001............................................... 96,622 148,310 244,932
2002............................................... -- 145,854 145,854
Thereafter......................................... -- 158,723 158,723
---------- ---------- ----------
$2,191,308 $1,181,803 $3,373,111
========== ========== ==========
</TABLE>

4. INCOME TAXES

The Company accounts for income taxes using the liability method required
by FASB Statement No. 109. Under this method, deferred tax assets and
liabilities are determined based on differences between financial reporting and
tax bases of assets and liabilities and are measured using the enacted tax rates
and laws that will be in effect when the differences are expected to reverse.

The components of the provision for (benefit from) income taxes are as
follows:

<TABLE>
<CAPTION>
1995 1996 1997
---------- ---------- ----------
<S> <C> <C> <C>
Current:
Foreign expense.................................. $ 32,656 $ 151,353 $ 194,204
Domestic expense................................. 1,352,164 1,180,895 1,571,196
---------- ---------- ----------
1,384,820 1,332,248 1,765,400
Deferred:
Domestic (benefit) expense....................... (409,842) 249,432 (190,093)
---------- ---------- ----------
$ 974,978 $1,581,680 $1,575,307
========== ========== ==========
</TABLE>

Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. Undistributed earnings of
the Company's foreign subsidiaries amounted to approximately $68,000 at December
31, 1997. Those earnings are considered to be permanently reinvested and,
accordingly, no provision for deferred U.S. federal and state income taxes has
been provided thereon. Upon distribution of those earnings in the form of
dividends or otherwise, the Company would be subject to both U.S. income taxes
(subject to adjustment for foreign tax credits) and withholding taxes payable to
the various foreign countries.

F-11
<PAGE> 66
E3 CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Significant components of the Company's net deferred tax assets are as
follows:

<TABLE>
<CAPTION>
1995 1996 1997
-------- -------- --------
<S> <C> <C> <C>
Assets:
Foreign net operating loss carryforwards........ $ 84,000 $ 42,000 $ --
Allowance for doubtful accounts................. 55,996 55,996 224,200
Accrued liabilities............................. 514,398 251,546 271,492
Valuation allowance............................... (84,000) (42,000) --
-------- -------- --------
Total deferred tax assets............... 570,394 307,542 495,692
Liabilities:
Depreciation.................................... (71,318) (32,343) (30,400)
-------- -------- --------
Net deferred tax assets................. $499,076 $275,199 $465,292
======== ======== ========
</TABLE>

The reconciliation of income tax computed at the U.S. federal statutory tax
rates to income tax expense is:

<TABLE>
<CAPTION>
1995 1996 1997
---------- ---------- ----------
<S> <C> <C> <C>
Tax at U.S. statutory rates........................ $1,031,400 $1,306,400 $1,303,346
State taxes........................................ 119,337 153,691 154,606
Nondeductible expenses............................. 23,800 73,803 105,271
Change in valuation allowance...................... (68,287) 42,000 (42,000)
R&D credit......................................... (66,767) (20,081) (50,000)
Foreign tax rate differences....................... 17,851 54,132 91,624
Foreign tax credit................................. (20,298) (4,115) --
Other.............................................. (62,058) (24,150) 12,460
---------- ---------- ----------
Total tax expense........................ $ 974,978 $1,581,680 $1,575,307
========== ========== ==========
</TABLE>

During 1995, 1996 and 1997, the Company utilized approximately $207,000,
$159,000 and $111,000, respectively, of foreign net operating loss carryforwards
to reduce taxable income in the respective tax jurisdictions. At December 31,
1997, the Company had no remaining foreign net operating loss carryforwards.

The income (loss) before income taxes for each of the foreign locations is
as follows:

<TABLE>
<CAPTION>
1995 1996 1997
--------- --------- ---------
<S> <C> <C> <C>
E3 Norden AB...................................... $ 76,725 $ (27,988) $(149,206)
E3 GmbH........................................... (13,276) 216,033 224,128
E3 France S.A. ................................... 193,983 60,785 45,809
E3 United Kingdom, Ltd............................ 27,290 93,329 122,352
E3 Italia S.R.L. ................................. -- (933) 21,601
</TABLE>

5. SHAREHOLDERS' EQUITY

On November 5, 1997, the Company's directors approved a stock dividend for
shareholders of record at such date, increasing the number of shares outstanding
from 82,365 shares to 15,649,350 shares, effective January 1, 1998. All share
and per share amounts related to Common Stock have been retroactively restated
to reflect the stock split for all periods presented.

All shareholders are subject to a Shareholders' Agreement which, among
other things, give the Company and the shareholders of the Company the right of
first refusal to purchase their shares at one and one-half times book value,
subject to certain adjustments, per share. The Shareholders' Agreement expires
upon the registration of any of the Company's shares with the Securities and
Exchange Commission.

F-12
<PAGE> 67
E3 CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

STOCK OPTIONS

The Company adopted a Stock Incentive Plan, effective on January 1, 1997.
The aggregate number of shares reserved for issuance under the Stock Incentive
Plan is 3,000,000 shares. The purpose of the Stock Incentive Plan is to provide
incentives for key employees, officers, consultants and directors to promote the
success of the Company and to enhance the Company's ability to attract and
retain the services of such persons.

Options granted under the Stock Incentive Plan may be either options
intended to qualify as "incentive stock options" under Section 422 of the
Internal Revenue Code of 1986, as amended, or nonqualified stock options.

As of December 31, 1997 options to purchase 725,419 shares of Common Stock
were outstanding under the Stock Incentive Plan and no shares of Common Stock
have been issued upon exercise of options granted under the Stock Incentive
Plan. In addition to options issued under the Stock Incentive Plan, at December
31, 1997, the Company has outstanding options to purchase an aggregate of
148,354 shares of Common Stock granted to employees outside of the Stock
Incentive Plan. Options outstanding vest over the second, third, and fourth
anniversaries of the grant date and have a term of ten years.

The Company has elected to follow APB 25 and related interpretations in
accounting for its employee stock options rather than the alternative fair value
accounting provided for under SFAS 123. Under APB 25, when the exercise price of
the company's employee stock options equals the market price of the underlying
stock on the date of grant, no compensation expense is recognized.

Pro forma information regarding net income and earnings per share is
required by SFAS 123, which also requires that the information be determined as
if the Company has accounted for its employee stock options granted subsequent
to December 31, 1994 under the fair value method of that Statement. The fair
value for these options was estimated at the date of grant using the "minimum
value" option pricing model with the following weighted-average assumptions for
1996 and 1997, respectively; risk-free interest rates of 6%; dividend yield of
0%, no weighted average volatility factor and a weighted-average expected life
of the options of 4 years. Calculated under SFAS 123, the options granted in
1996 and 1997 were estimated to have no value and pro forma net income and net
income per share for 1996 and 1997 are the same as reported in the consolidated
statements of income.

A summary of the Company's option activity and related information follows:

<TABLE>
<CAPTION>
WEIGHTED AVERAGE
OPTIONS EXERCISE PRICE
------- ----------------
<S> <C> <C>
Outstanding at December 31, 1995............................ -- N/A
Granted................................................... 148,354 $9.10
-------
Outstanding at December 31, 1996............................ 148,354 $9.10
Granted................................................... 725,419 $9.70
-------
Outstanding at December 31, 1997............................ 873,773 $9.59
=======
</TABLE>

Exercise prices for options outstanding as of December 31, 1997 range from
$9.10 to $11.05 per share, all of which exceeded the Company's estimate of fair
value of Common Stock on the grant date. Options outstanding at December 31,
1997 had a weighted average remaining life of 9.15 years. There were no options
exercisable at December 31, 1996 or December 31, 1997.

At December 31, 1997, the Company had 2,274,581 shares available for future
grant under the Stock Incentive Plan.

F-13
<PAGE> 68
E3 CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

6. BENEFIT PLAN

The Company has a defined contribution plan covering substantially all
employees. Under the provisions of the plan, which qualifies under Section
401(k) of the Internal Revenue Code, participating employees may elect to
contribute specified amounts of their salaries to a trust for investment. The
Company contributes an amount which is determined on an annual basis depending
on profits. In 1995, 1996 and 1997, approximately $53,000, $78,000 and $85,000,
respectively, was charged to expense under the plan.

7. GEOGRAPHIC INFORMATION

Sales, operating expenses and identifiable assets, classified by the major
geographic areas in which the Company operates are as follows:

<TABLE>
<CAPTION>
UNITED STATES EUROPE ELIMINATIONS CONSOLIDATED
------------- ---------- ------------ ------------
<S> <C> <C> <C> <C>
1995
Revenue:
Customers -- non-export............. $10,710,949 $4,307,486 $ -- $15,018,435
Customers -- export................. 1,225,000 -- -- 1,225,000
Intercompany........................ 667,498 -- (667,498) --
----------- ---------- --------- -----------
Total....................... $12,603,447 $4,307,486 $(667,498) $16,243,435
=========== ========== ========= ===========
Operating income...................... $ 2,007,740 $ 909,308 $ -- $ 2,917,048
=========== ========== ========= ===========
Identifiable assets(1)................ $ 9,617,018 $ 891,717 $ -- $10,508,735
=========== ========== ========= ===========
1996
Revenue:
Customers -- non-export............. $11,552,429 $6,991,549 $ -- $18,543,978
Customers -- export................. 1,245,000 -- -- 1,245,000
Intercompany........................ 982,744 -- (982,744) --
----------- ---------- --------- -----------
Total....................... $13,780,173 $6,991,549 $(982,744) $19,788,978
=========== ========== ========= ===========
Operating income...................... $ 2,425,420 $1,312,828 $ -- $ 3,738,248
=========== ========== ========= ===========
Identifiable assets(1)................ $10,700,251 $2,279,291 $ -- $12,979,542
=========== ========== ========= ===========
1997
Revenue:
Customers -- non-export............. $17,175,151 $7,401,223 $ -- $24,576,374
Customers -- export................. 285,000 -- -- 285,000
Intercompany........................ 701,061 -- (701,061) --
----------- ---------- --------- -----------
Total....................... $18,161,212 $7,401,223 $(701,061) $24,861,374
=========== ========== ========= ===========
Operating income...................... $ 3,364,427 $ 308,254 $ -- $ 3,672,681
=========== ========== ========= ===========
Identifiable assets(1)................ $12,529,869 $3,294,349 $ -- $15,824,218
=========== ========== ========= ===========
</TABLE>

- ---------------

(1) Identifiable assets are net of intercompany investment.

Export sales from the United States are principally to Australia, Canada
and Latin America. Intercompany sales between geographic areas are at amounts
above cost and in accordance with the rules and regulations of the respective
governing tax authorities. Operating income is total revenue less operating
expenses. United States operating income is net of corporate expenses.

F-14
<PAGE> 69
E3 CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

8. RELATED PARTY TRANSACTIONS

In 1996, the Company paid a $500,000 fee for consulting services to a
corporation that is wholly-owned by Anders H. Herlitz, the Company's Chairman
and Chief Executive Officer.

9. SUBSEQUENT EVENTS

The Company amended its Articles of Incorporation, effective January 1,
1998, changing the name of the Company to E3 Corporation and authorizing the
total shares of Common Stock available for issuance to 50,000,000 shares.

On February 1, 1998, the Company granted to employees options to purchase
173,500 shares of Common Stock for an exercise price of $11.25 per share.

On May 14, 1998, the Company's Board of Directors approved an amendment,
subject to and contingent upon completion of an initial public offering, of its
Articles of Incorporation to increase the authorized shares of $.05 par value
Common Stock to 100,000,000 shares and to authorize 50,000,000 shares of $.01
par value Preferred Stock.

F-15
<PAGE> 70

No dealer, salesperson or any person has been authorized to give any
information or to make any representations not contained in this Prospectus in
connection with the offer made by this Prospectus, and if given or made, such
information or representations must not be relied upon as having been authorized
by the Company or the Underwriters. This Prospectus does not constitute an offer
to sell or a solicitation of an offer to buy any of the securities offered
hereby to any one in any jurisdiction in which such offer or solicitation is not
qualified to do so or to anyone to whom it is unlawful to make such an offer or
solicitation. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that the
information contained herein is correct as of any time subsequent to the date of
this Prospectus.

---------------------------

Table of Contents

<TABLE>
<CAPTION>
Page
----
<S> <C>
Prospectus Summary......................... 3
Risk Factors............................... 6
Use of Proceeds............................ 15
Dividend Policy............................ 15
Capitalization............................. 16
Dilution................................... 17
Selected Consolidated Financial Data....... 18
Management's Discussion and Analysis
of Financial Condition and Results of
Operations............................. 19
Business................................... 29
Management................................. 40
Certain Transactions....................... 44
Principal and Selling Shareholders......... 45
Description of Capital Stock............... 46
Shares Eligible for Future Sale............ 50
Underwriting............................... 51
Legal Matters.............................. 53
Experts.................................... 53
Additional Information..................... 53
Index to Consolidated Financial
Statements............................... F-1
</TABLE>

Until , 1998 (25 days after the date of this
Prospectus), all dealers effecting transactions in the Common Stock, whether or
not participating in this distribution, may be required to deliver a Prospectus.
This is in addition to the obligation of dealers to deliver a Prospectus when
acting as Underwriters and with respect to their unsold allotments or
subscriptions.
SHARES

[E3 LOGO]
E3 CORPORATION

COMMON STOCK
---------------------------
PROSPECTUS
, 1998
---------------------------
UBS SECURITIES

SBC WARBURG DILLON READ INC.

SOUNDVIEW FINANCIAL
GROUP, INC.
<PAGE> 71

PART II

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

<TABLE>
<S> <C>
Securities and Exchange Commission registration fee......... $11,800
National Association of Securities Dealers, Inc. fee........ 4,500
Nasdaq National Market listing fee.......................... *
Accountants' fees and expenses.............................. *
Legal fees and expenses..................................... *
Blue Sky fees and expenses.................................. *
Transfer Agent's fees and expenses.......................... *
Printing and engraving expenses............................. *
Insurance policy............................................ *
Miscellaneous............................................... *
-------
Total Expenses.............................................. $ *
=======
</TABLE>

- ---------------

* To be completed by amendment.

All fees other than the SEC registration fee, the NASD fee and the Nasdaq
National Market listing fee are estimated. None of the expenses of the issuance
and distribution of the Common Stock being offered will be borne by the Selling
Shareholders.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Company's Restated Articles provide that the liability of the directors
for monetary damages shall be limited to the fullest extent permissible under
Georgia law. This limitation of liability does not affect the availability of
injunctive relief or other equitable remedies.

The Company's Restated Bylaws provide that the Company shall indemnify each
of its officers, directors, employees and agents to the extent that he or she is
or was a party, or is threatened to be made a party, to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative by reason of the fact that such person is or was a director,
officer, employee or agent of the Company, against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement in connection
with such action, suit or proceeding; provided, however, that no indemnification
shall be made for (i) any appropriation, in violation of his duties, of any
business opportunity of the Company, (ii) acts or omissions which involve
intentional misconduct or a knowing violation of laws, (iii) any liability under
Section 14-2-832 of the GBCC, which relates to unlawful payments of dividends
and unlawful stock repurchases and redemptions, or (iv) any transaction from
which he derived an improper personal benefit.

Section 10 of the Underwriting Agreement filed as Exhibit 1.1 hereto also
contains certain provisions pursuant to which certain officers, directors and
controlling persons of the Company may be entitled to be indemnified by the
underwriters named therein.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

The Company has issued stock options to purchase an aggregate of 898,919
shares of Common Stock under its Stock Incentive Plan at a weighted average
exercise price of $10 per share. In addition, the Company has issued stock
options to purchase an aggregate of 148,354 shares of Common Stock at a weighted
average exercise price of $9.10 per share. No shares of Common Stock have been
issued pursuant to the exercise of such options.

II-1
<PAGE> 72

ITEM 16. EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S> <C>
1.1* -- Form of Underwriting Agreement.
3.1 -- Form of Amended and Restated Articles of Incorporation of
the Registrant.
3.2 -- Form of Amended and Restated Bylaws of the Registrant.
4.1 -- See Exhibits 3.1 and 3.2 for provisions of the Amended and
Restated Articles of Incorporation and Amended and Restated
Bylaws of the Registrant defining rights of the holders of
Common Stock of the Registrant.
4.2* -- Specimen Stock Certificate.
5.1* -- Opinion of Morris, Manning & Martin, L.L.P., Counsel to the
Registrant, as to the legality of the shares being
registered.
10.1 -- Lease Agreement by and between Two Park, Inc., having
LaSalle Partners Asset Management Limited, as its Agent and
E3 Associates, Ltd., dated November 8, 1990.
10.2 -- Amendment to Lease Agreement by and between Two Park, Inc.,
having LaSalle Partners Asset Management Limited, as its
Agent and E3 Associates, Ltd., dated August 14, 1995.
10.3 -- Second Amendment to Lease Agreement by and between Two Park,
Inc., having LaSalle Partners Asset Management Limited, as
its Agent and E3 Associates, Ltd., dated April 22, 1996.
10.4* -- Third Amendment to Lease Agreement by and between Alaska
Parkway Investment Group, Inc., as its duly authorized agent
and E3 North America, Inc. (f/k/a E3 Associates, Ltd.),
dated June , 1998.
10.5 -- Stock Incentive Plan of the Registrant.
10.6 -- Form of Stock Option Grant Certificate under the Stock
Incentive Plan of the Registrant.
10.7 -- E3 Associates, Ltd. 401(k) Employee Savings Plan Adoption
Agreement.
21.1 -- List of Subsidiaries.
23.1 -- Consent of Ernst & Young LLP.
23.2* -- Consent of Morris, Manning & Martin, L.L.P. (included in
Exhibit 5.1).
24.1 -- Powers of Attorney (included on signature page).
27.1 -- Financial Data Schedule (for SEC use only).
</TABLE>

- ---------------

* To be filed by amendment

ITEM 17. UNDERTAKINGS

(a) The undersigned Registrant hereby undertakes to provide to the
Underwriters at the closing specified in the Underwriting Agreement certificates
in such denominations and registered in such names as required by the
Underwriters to permit prompt delivery to each purchaser.

(b) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that, in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.

II-2
<PAGE> 73

(i) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in the
form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of the
Registration Statement as of the time it was declared effective.

(ii) For purposes of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

II-3
<PAGE> 74

SIGNATURES

Pursuant to the requirements of the Securities Act, the Registrant has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Marietta, State of
Georgia on the 9th day of June, 1998.

E3 CORPORATION

By: /s/ ANDERS H. HERLITZ
------------------------------------
Anders H. Herlitz
Chairman and Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Anders H. Herlitz, Frank K. Schuster and R. Lee
Morris, and each of them, his true and lawful attorneys-in-fact and agents, with
full power of substitution and resubstitution for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and any subsequent
registration statements pursuant to Rule 462 of the Securities Act and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that each of said
attorney-in-fact or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>

/s/ ANDERS H. HERLITZ Chairman of the Board and Chief June 9, 1998
- --------------------------------------------------- Executive Officer (Principal
Anders H. Herlitz Executive Officer)

/s/ FRANK K. SCHUSTER President, Chief Operating Officer June 9, 1998
- --------------------------------------------------- and Director
Frank K. Schuster

/s/ WILLIAM H. HUTHER Vice Chairman of the Board and June 9, 1998
- --------------------------------------------------- Senior Vice President -- Sales
William H. Huther and Marketing

/s/ R. LEE MORRIS Chief Financial Officer (Principal June 9, 1998
- --------------------------------------------------- Financial and Accounting Officer)
R. Lee Morris

/s/ THOMAS J. O'HAREN Director June 9, 1998
- ---------------------------------------------------
Thomas J. O'Haren
</TABLE>

II-4

<PAGE> 1
EXHIBIT 3.1

AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
E3 CORPORATION

Pursuant to Sections 14-2-1001 and 14-2-1003 of the Georgia Business
Corporation Code, E3 Corporation hereby amends and restates its Articles of
Incorporation in their entirety and substitutes the following in lieu thereof:

The Amended and Restated Articles of Incorporation were adopted by the
Board of Directors and Shareholders on May 14, 1998.

ARTICLE ONE
NAME

The name of the corporation is E3 CORPORATION (the "Corporation").

ARTICLE TWO
CAPITALIZATION

The Corporation shall have authority, exercisable by its Board of
Directors, to issue up to 100,000,000 shares of common stock, $.05 par value per
share ("Common Stock"), and 50,000,000 shares of preferred stock, $.01 par value
per share ("Preferred Stock"), any part or all of which shares of Preferred
Stock may be established and designated from time to time by the Board of
Directors, in such series and with such preferences, limitations and relative
rights as may be determined by the Board of Directors.

ARTICLE THREE
PRINCIPAL OFFICE

The mailing address of the principal office of the Corporation shall be
1800 Parkway Place, Suite 600, Marietta, Cobb County, Georgia 30067.

ARTICLE FOUR
DIRECTORS

The initial Board of Directors of the Corporation is composed of the
following Directors: Anders H. Herlitz, Christina R. Herlitz, William H. Huther,
Frank K. Schuster and Thomas O'Haren.

ARTICLE FIVE
STAGGERED BOARD OF DIRECTORS

The Board of Directors shall be divided into three classes to be known
as Class I, Class II and Class III, which shall be as nearly equal in number as
possible. Except in case of death, resignation, disqualification or removal,
each Director shall serve for a term ending on the date of

<PAGE> 2
the third annual meeting of shareholders following the annual meeting at which
the Director was elected; provided, however, that each initial Director in Class
I shall hold office until the 1999 annual meeting of shareholders; each initial
Director in Class II shall hold office until the 2000 annual meeting of
shareholders; and each initial Director in Class III shall hold office until the
2001 annual meeting of shareholders. In the event of any increase or decrease in
the authorized number of Directors, the newly created or eliminated
directorships resulting from such an increase or decrease shall be apportioned
among the three classes of Directors so that the three classes remain as nearly
equal in size as possible; provided, however, that there shall be no
classification of additional Directors elected by the Board of Directors until
the next meeting of shareholders called for the purposes of electing Directors,
at which meeting the terms of all such additional Directors shall expire, and
such additional Director positions, if they are to be continued, shall be
apportioned among the classes of Directors, and nominees therefor shall be
submitted to the shareholders for their vote.

ARTICLE SIX
LIMITATION ON DIRECTOR LIABILITY

No Director of the Corporation shall be personally liable to the
Corporation or its shareholders for monetary damages for breach of the duty of
care or any other duty as a Director, except that such liability shall not be
eliminated for:

(i) any appropriation, in violation of the Director's
duties, of any business opportunity of the Corporation;

(ii) acts or omissions that involve intentional misconduct
or a knowing violation of law;

(iii) liability under Section 14-2-832 (or any successor
provision or redesignation thereof) of the Georgia Business Corporation Code
(the "Code"); and

(iv) any transaction from which the Director received an
improper personal benefit.

If at any time the Code shall have been amended to authorize the
further elimination or limitation of the liability of a Director, then the
liability of each Director of the Corporation shall be eliminated or limited to
the fullest extent permitted by the Code, as so amended, without further action
by the shareholders, unless the provisions of the Code, as amended, require
further action by the shareholders.

Any repeal or modification of the foregoing provisions of this Article
Six shall not adversely affect the elimination or limitation of liability or
alleged liability pursuant hereto of any Director of the Corporation for or with
respect to any alleged act or omission of the Director occurring prior to such a
repeal or modification.

-2-
<PAGE> 3
ARTICLE SEVEN
SHAREHOLDER ACTION WITHOUT MEETING
BY LESS THAN UNANIMOUS CONSENT

The shareholders, without a meeting, may take any action required or
permitted to be taken at a meeting of the shareholders, if written consent
setting forth the action to be taken is signed by those persons who would be
entitled to vote at a meeting who hold those shares having voting power to cast
not less than the minimum number (or numbers, in the case of voting by classes)
of votes that would be necessary to authorize or take the action at a meeting at
which all shares entitled to vote were present and voted. An action by less than
unanimous consent may not be taken with respect to any election of Directors as
to which shareholders would be entitled to cumulative voting.

ARTICLE EIGHT
CONSIDERATION OF INTERESTS OF
NON-SHAREHOLDER CONSTITUENCIES

The Board of Directors, any committee of the Board of Directors and any
individual Director, in discharging the duties of its, his or her respective
positions and in determining what is believed to be in the best interest of the
Corporation, may in its, his or her sole discretion consider the interests of
the employees, customers, suppliers and creditors of the Corporation and its
subsidiaries, the communities in which offices or other establishments of the
Corporation and its subsidiaries are located and all other factors such Director
or Directors consider pertinent, in addition to considering the effects of any
action on the Corporation and its shareholders. Notwithstanding the foregoing,
this Article Eight shall not be deemed to provide any of the foregoing
constituencies any right to be considered in any such discharging of duties or
determination.

ARTICLE NINE
AMENDMENTS

Notwithstanding any other provision of these Articles of Incorporation,
the Corporation's Bylaws or law, neither Articles Five, Six, Seven or Eight
hereof nor this Article Nine may be amended or repealed except upon the
affirmative vote of holders of at least 66-2/3% of the total number of votes of
the then outstanding shares of capital stock of the Company that are entitled to
vote generally in the election of Directors, voting together as a single class.

IN WITNESS WHEREOF, the undersigned executes these Articles of
Incorporation on _____________, 1998.

--------------------------------------------
Anders H. Herlitz, Chairman of the Board
and Chief Executive Officer

-3-

<PAGE> 1
EXHIBIT 3.2

AMENDED AND RESTATED

BYLAWS

E3 CORPORATION

EFFECTIVE ___________, 1998

<PAGE> 2
AMENDED AND RESTATED
BYLAWS
OF
E3 CORPORATION

TABLE OF CONTENTS

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ARTICLE ONE OFFICE............................................................1

1.1 REGISTERED OFFICE AND AGENT.................................................1
1.2 PRINCIPAL OFFICE............................................................1
1.3 OTHER OFFICES...............................................................1

ARTICLE TWO SHAREHOLDERS' MEETINGS............................................1

2.1 PLACE OF MEETINGS...........................................................2
2.2 ANNUAL MEETINGS.............................................................2
2.3 SPECIAL MEETINGS............................................................2
2.4 NOTICE OF MEETINGS..........................................................2
2.5 WAIVER OF NOTICE............................................................2
2.6 VOTING GROUP; QUORUM; VOTE REQUIRED TO ACT..................................3
2.7 VOTING OF SHARES............................................................3
2.8 PROXIES.....................................................................3
2.9 PRESIDING OFFICER...........................................................3
2.10 ADJOURNMENTS...............................................................4
2.11 CONDUCT OF THE MEETING.....................................................4
2.12 INSPECTOR OF ELECTION......................................................4
2.13 ACTION OF SHAREHOLDERS WITHOUT A MEETING...................................5
2.14 MATTERS CONSIDERED AT ANNUAL MEETINGS......................................5

ARTICLE THREE BOARD OF DIRECTORS..............................................6

3.1 GENERAL POWERS..............................................................6
3.2 NUMBER, ELECTION AND TERM OF OFFICE.........................................6
3.3 REMOVAL OF DIRECTORS........................................................6
3.4 VACANCIES...................................................................6
3.5 COMPENSATION................................................................7
3.6 COMMITTEES OF THE BOARD OF DIRECTORS........................................7
3.7 QUALIFICATION OF DIRECTORS..................................................7
3.8 CERTAIN NOMINATION REQUIREMENTS.............................................7

ARTICLE FOUR MEETINGS OF THE BOARD OF DIRECTORS...............................8

4.1 REGULAR MEETINGS............................................................8
4.2 SPECIAL MEETINGS............................................................8
4.3 PLACE OF MEETINGS...........................................................8
4.4 NOTICE OF MEETINGS..........................................................8
4.5 QUORUM......................................................................8
4.6 VOTE REQUIRED FOR ACTION....................................................8
4.7 PARTICIPATION BY CONFERENCE TELEPHONE.......................................9
4.8 ACTION BY DIRECTORS WITHOUT A MEETING.......................................9
4.9 ADJOURNMENTS................................................................9
4.10 WAIVER OF NOTICE...........................................................9
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ARTICLE FIVE OFFICERS........................................................10

5.1 OFFICERS...................................................................10
5.2 TERM.......................................................................10
5.3 COMPENSATION...............................................................10
5.4 REMOVAL....................................................................10
5.5 CHAIRMAN OF THE BOARD......................................................10
5.6 CHIEF EXECUTIVE OFFICER....................................................11
5.7 PRESIDENT..................................................................11
5.8 VICE PRESIDENTS............................................................11
5.9 SECRETARY..................................................................11
5.10 TREASURER.................................................................11

ARTICLE SIX DISTRIBUTIONS AND DIVIDENDS......................................12

ARTICLE SEVEN SHARES.........................................................12

7.1 SHARE CERTIFICATES.........................................................12
7.2 RIGHTS OF CORPORATION WITH RESPECT TO REGISTERED OWNERS....................12
7.3 TRANSFERS OF SHARES........................................................13
7.4 DUTY OF CORPORATION TO REGISTER TRANSFER...................................13
7.5 LOST, STOLEN, OR DESTROYED CERTIFICATES....................................13
7.6 FIXING OF RECORD DATE......................................................13
7.7 RECORD DATE IF NONE FIXED..................................................13

ARTICLE EIGHT INDEMNIFICATION................................................14

8.1 INDEMNIFICATION OF DIRECTORS...............................................14
8.2 INDEMNIFICATION OF OTHERS..................................................14
8.3 OTHER ORGANIZATIONS........................................................14
8.4 ADVANCES...................................................................15
8.5 NON-EXCLUSIVITY............................................................15
8.6 INSURANCE..................................................................15
8.7 NOTICE.....................................................................15
8.8 SECURITY...................................................................16
8.9 AMENDMENT..................................................................16
8.10 AGREEMENTS...............................................................16
8.11 CONTINUING BENEFITS......................................................16
8.12 SUCCESSORS...............................................................16
8.13 SEVERABILITY.............................................................16
8.14 ADDITIONAL INDEMNIFICATION...............................................17

ARTICLE NINE MISCELLANEOUS...................................................17

9.1 INSPECTION OF BOOKS AND RECORDS............................................17
9.2 FISCAL YEAR................................................................17
9.3 CORPORATE SEAL.............................................................17
9.4 ANNUAL STATEMENTS..........................................................17
9.5 NOTICE.....................................................................18
9.6 ELECTION OF "FAIR PRICE" STATUTE...........................................18
9.7 ELECTION OF "BUSINESS COMBINATION" STATUTE.................................18

ARTICLE TEN AMENDMENTS.......................................................18
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<PAGE> 4
AMENDED AND RESTATED

BYLAWS

E3 CORPORATION

References in these Amended and Restated Bylaws of E3 CORPORATION, a
Georgia corporation (the "Corporation") (these "Bylaws") to "Articles of
Incorporation" are to the Amended and Restated Articles of Incorporation of the
Corporation as may be amended and restated from time to time.

All of these Bylaws are subject to contrary provisions, if any, of the
Articles of Incorporation (including provisions designating the preferences,
limitations, and relative rights of any class or series of shares), the Georgia
Business Corporation Code (the "Code"), and other applicable law, as in effect
on and after the effective date of these Bylaws. References in these Bylaws to
"Sections" shall refer to sections of the Bylaws, unless otherwise indicated.

ARTICLE ONE

OFFICE

1.1 REGISTERED OFFICE AND AGENT. The Corporation shall maintain a
registered office and shall have a registered agent whose business office is the
same as the registered office.

1.2 PRINCIPAL OFFICE. The principal office of the Corporation
shall be at the place designated in the Corporation's annual registration with
the Georgia Secretary of State.

1.3 OTHER OFFICES. In addition to its registered office and
principal office, the Corporation may have offices at other locations either in
or outside the State of Georgia.

ARTICLE TWO

SHAREHOLDERS' MEETINGS

2.1 PLACE OF MEETINGS. Meetings of the Corporation's shareholders
may be held at any location inside or outside the State of Georgia designated by
the Board of Directors or any other person or persons who properly call the
meeting, or if the Board of Directors or such other person or persons do not
specify a location, at the Corporation's principal office.
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2.2 ANNUAL MEETINGS. The Corporation shall hold an annual meeting
of shareholders, at a time determined by the Board of Directors, to elect
directors and to transact any business that properly may come before the
meeting. The annual meeting may be combined with any other meeting of
shareholders, whether annual or special.

2.3 SPECIAL MEETINGS. Special meetings of shareholders of one or
more classes or series of the Corporation's shares may be called at any time by
the Board of Directors, the Chairman of the Board, the Chief Executive Officer
or the President, and shall be called by the Corporation upon the written
request (in compliance with applicable requirements of the Code) of the holders
of shares representing not less than 35% or more of the votes entitled to be
cast on each issue proposed to be considered at the special meeting. The
business that may be transacted at any special meeting of shareholders shall be
limited to that proposed in the notice of the special meeting given in
accordance with Section 2.4 (including related or incidental matters that may be
necessary or appropriate to effectuate the proposed business).

2.4 NOTICE OF MEETINGS. In accordance with Section 9.5 and subject
to waiver by a shareholder pursuant to Section 2.5, the Corporation shall give
written notice of the date, time, and place of each annual and special
shareholders' meeting no fewer than 10 days nor more than 60 days before the
meeting date to each shareholder of record entitled to vote at the meeting. The
notice of an annual meeting need not state the purpose of the meeting unless
these Bylaws require otherwise. The notice of a special meeting shall state the
purpose for which the meeting is called. If an annual or special shareholders'
meeting is adjourned to a different date, time, or location, the Corporation
shall give shareholders notice of the new date, time, or location of the
adjourned meeting, unless a quorum of shareholders was present at the meeting
and information regarding the adjournment was announced before the meeting was
adjourned; provided, however, that if a new record date is or must be fixed in
accordance with Section 7.6, the Corporation must give notice of the adjourned
meeting to all shareholders of record as of the new record date who are entitled
to vote at the adjourned meeting.

2.5 WAIVER OF NOTICE. A shareholder may waive any notice required
by the Code, the Articles of Incorporation, or these Bylaws, before or after the
date and time of the matter to which the notice relates, by delivering to the
Corporation a written waiver of notice signed by the shareholder entitled to the
notice. In addition, a shareholder's attendance at a meeting shall be (a) a
waiver of objection to lack of notice or defective notice of the meeting unless
the shareholder at the beginning of the meeting objects to holding the meeting
or transacting business at the meeting, and (b) a waiver of objection to
consideration of a particular matter at the meeting that is not within the
purpose stated in the meeting notice, unless the shareholder objects to
considering the matter when it is presented. Except as otherwise required by the
Code, neither the purpose of nor the business transacted at the meeting need be
specified in any waiver.

2.6 VOTING GROUP; QUORUM; VOTE REQUIRED TO ACT. (a) Unless
otherwise required by the Code or the Articles of Incorporation, all classes or
series of the Corporation's shares entitled to vote generally on a matter shall
for that purpose be considered a single voting group (a "Voting Group"). If
either the Articles of Incorporation or the Code requires separate voting by two
or more Voting Groups on a matter, action on that matter is taken only when
voted upon by

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each such Voting Group separately. At all meetings of shareholders, any Voting
Group entitled to vote on a matter may take action on the matter only if a
quorum of that Voting Group exists at the meeting, and if a quorum exists, the
Voting Group may take action on the matter notwithstanding the absence of a
quorum of any other Voting Group that may be entitled to vote separately on the
matter. Unless the Articles of Incorporation, these Bylaws, or the Code provides
otherwise, the presence (in person or by proxy) of shares representing a
majority of votes entitled to be cast on a matter by a Voting Group shall
constitute a quorum of that Voting Group with regard to that matter. Once a
share is present at any meeting other than solely to object to holding the
meeting or transacting business at the meeting, the share shall be deemed
present for quorum purposes for the remainder of the meeting and for any
adjournments of that meeting, unless a new record date for the adjourned meeting
is or must be set pursuant to Section 7.6 of these Bylaws.

(b) Except as provided in Section 3.4, if a quorum exists, action
on a matter by a Voting Group is approved by that Voting Group if the votes cast
within the Voting Group favoring the action exceed the votes cast opposing the
action, unless the Articles of Incorporation, a provision of these Bylaws that
has been adopted pursuant to Section 14-2-1021 of the Code (or any successor
provision), or the Code requires a greater number of affirmative votes.

2.7 VOTING OF SHARES. Unless otherwise required by the Code or the
Articles of Incorporation, each outstanding share of any class or series having
voting rights shall be entitled to one vote on each matter that is submitted to
a vote of shareholders.

2.8 PROXIES. A shareholder entitled to vote on a matter may vote
in person or by proxy pursuant to an appointment executed in writing by the
shareholder or by his or her attorney-in-fact. An appointment of a proxy shall
be valid for 11 months from the date of its execution, unless a longer or
shorter period is expressly stated in the appointment form.

2.9 PRESIDING OFFICER. Except as otherwise provided in this
Section 2.9, the Chairman of the Board, and in his or her absence or disability
the Chief Executive Officer, and in his or her absence or disability the
President, shall preside at every shareholders' meeting (and any adjournment
thereof) as its chairman, if either of them is present and willing to serve. If
neither the Chairman of the Board, nor the Chief Executive Officer nor the
President is present and willing to serve as chairman of the meeting, and if the
Chairman of the Board has not designated another person who is present and
willing to serve, then a majority of the Corporation's directors present at the
meeting shall be entitled to designate a person to serve as chairman. If no
director of the Corporation is present at the meeting or if a majority of the
directors who are present cannot be established, then a chairman of the meeting
shall be selected by a majority vote of (a) the shares present at the meeting
that would be entitled to vote in an election of directors, or (b) if no such
shares are present at the meeting, then the shares present at the meeting
comprising the Voting Group with the largest number of shares present at the
meeting and entitled to vote on a matter properly proposed to be considered at
the meeting. The chairman of the meeting may designate other persons to assist
with the meeting.

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2.10 ADJOURNMENTS. At any meeting of shareholders (including an
adjourned meeting), a majority of shares of any Voting Group present and
entitled to vote at the meeting (whether or not those shares constitute a
quorum) may adjourn the meeting, but only with respect to that Voting Group, to
reconvene at a specific time and place. If more than one Voting Group is present
and entitled to vote on a matter at the meeting, then the meeting may be
continued with respect to any such Voting Group that does not vote to adjourn as
provided above, and such Voting Group may proceed to vote on any matter to which
it is otherwise entitled to do so; provided, however, that if (a) more than one
Voting Group is required to take action on a matter at the meeting and (b) any
one of those Voting Groups votes to adjourn the meeting (in accordance with the
preceding sentence), then the action shall not be deemed to have been taken
until the requisite vote of any adjourned Voting Group is obtained at its
reconvened meeting. The only business that may be transacted at any reconvened
meeting is business that could have been transacted at the meeting that was
adjourned, unless further notice of the adjourned meeting has been given in
compliance with the requirements for a special meeting that specifies the
additional purpose or purposes for which the meeting is called. Nothing
contained in this Section 2.10 shall be deemed or otherwise construed to limit
any lawful authority of the chairman of a meeting to adjourn the meeting.

2.11 CONDUCT OF THE MEETING. At any meeting of shareholders, the
chairman of the meeting shall be entitled to establish the rules of order
governing the conduct of business at the meeting.

2.12 INSPECTORS OF ELECTION. The Corporation shall appoint one or
more persons, each of whom may be an officer or employee of the Corporation, to
act as an inspector at each meeting of shareholders. At each such meeting of
shareholders, the inspector shall be responsible for (i) ascertaining the number
of shares outstanding and the voting power of each; (ii) determining the shares
represents at such meeting; (iii) determining the validity of proxies and
ballots; (iv) counting all votes; (v) determining the result of all votes; and
(vi) making a written report of his or her determinations. In addition, such
inspector shall take and sign an oath to execute faithfully his or her duties
with strict impartiality and according to the best of his or her ability.

2.13 ACTION OF SHAREHOLDERS WITHOUT A MEETING. Action required or
permitted to be taken at a meeting of shareholders may be taken without a
meeting if the action is taken by all shareholders entitled to vote on the
action or, if permitted by the Articles of Incorporation, by persons who would
be entitled to vote at a meeting shares having voting power to cast the
requisite number of votes (or numbers, in the case of voting by groups) that
would be necessary to authorize or take the action at a meeting at which all
shareholders entitled to vote were present and voted. The action must be
evidenced by one or more written consents describing the action taken, signed by
shareholders entitled to take action without a meeting, and delivered to the
Corporation for inclusion in the minutes or filing with the corporate records.
Such consents shall be executed by shareholders sufficient to act by written
consent and received by the Corporation within sixty days of the date upon which
such consent is dated. Where required by Section 14-2-704 or other applicable
provision of the Code, the Corporation shall provide shareholders with written
notice of actions taken without a meeting.

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2.14 MATTERS CONSIDERED AT ANNUAL MEETINGS. Notwithstanding
anything to the contrary in these Bylaws, the only business that may be
conducted at an annual meeting of shareholders shall be business brought before
the meeting (a) by or at the direction of the Board of Directors prior to the
meeting, (b) by or at the direction of the Chairman of the Board, the Chief
Executive Officer or the President, or (c) by a shareholder of the Corporation
who is entitled to vote with respect to the business and who complies with the
notice procedures set forth in this Section 2.14. For business to be brought
properly before an annual meeting by a shareholder, the shareholder must have
given timely notice of the business in writing to the Secretary of the
Corporation. To be timely, a shareholder's notice must be delivered or mailed to
and received at the principal offices of the Corporation, not less than 60 days
before the date of the meeting at which the director(s) are to be elected or the
proposal is to be considered; however, if less than 70 days notice or prior
public disclosure of the date of the scheduled meeting is given or made, notice
by the shareholder, to be timely, must be delivered or received not later than
the close of business on the tenth day following the earlier of the day on which
notice of the date of the meeting is mailed to shareholders or public disclosure
of the date of such meeting is made. A shareholder's notice to the Secretary
shall set forth a brief description of each matter of business the shareholder
proposes to bring before the meeting and the reasons for conducting that
business at the meeting; the name, as it appears on the Corporation's books, and
address of the shareholder proposing the business; the series or class and
number of shares of the Corporation's capital stock that are beneficially owned
by the shareholder; and any material interest of the shareholder in the proposed
business. The chairman of the meeting shall have the discretion to declare to
the meeting that any business proposed by a shareholder to be considered at the
meeting is out of order and that such business shall not be transacted at the
meeting if (i) the chairman concludes that the matter has been proposed in a
manner inconsistent with this Section 2.14 or (ii) the chairman concludes that
the subject matter of the proposed business is inappropriate for consideration
by the shareholders at the meeting.

ARTICLE THREE

BOARD OF DIRECTORS

3.1 GENERAL POWERS. All corporate powers shall be exercised by or
under the authority of, and the business and affairs of the Corporation shall be
managed by, the Board of Directors, subject to any limitation set forth in the
Articles of Incorporation, in bylaws approved by the shareholders, or in
agreements among all the shareholders that are otherwise lawful.

3.2 NUMBER, ELECTION AND TERM OF OFFICE. The number of directors
of the Corporation shall be fixed by resolution of the Board of Directors or of
the shareholders from time to time and, until otherwise determined, shall be
five; provided, however, that no decrease in the number of directors shall have
the effect of shortening the term of an incumbent director. Except as provided
elsewhere in this Section 3.2 and in Section 3.4, the directors shall be elected
at each annual meeting of shareholders, or at a special meeting of shareholders
called for purposes that include the election of directors, by a plurality of
the votes cast by the shares

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entitled to vote and present at the meeting. Despite the expiration of a
director's term, he or she shall continue to serve until his or her successor,
if there is to be any, has been elected and has qualified.

3.3 REMOVAL OF DIRECTORS. The entire Board of Directors or any
individual director may be removed, with or without cause, by the shareholders,
provided that Directors elected by a particular Voting Group may be removed only
by the shareholders in that Voting Group. Removal action may be taken only at a
shareholder's meeting for which notice of the removal action has been given. The
foregoing notwithstanding, if the Directors have staggered terms, directors may
be removed only for "cause" unless the Articles of Incorporation provide
otherwise. A removed director's successor, if any, may be elected at the same
meeting to serve the unexpired term. "Cause" shall mean (i) misconduct as a
director of the Corporation or any subsidiary of the Corporation which involves
dishonesty with respect to a material corporate activity or material corporate
asset or (ii) conviction of an offense punishable by one or more years of
imprisonment (other than minor regulatory infractions and traffic violations
which do not materially and adversely affect the Company).

3.4 VACANCIES. A vacancy occurring in the Board of Directors may
be filled for the unexpired term, unless the shareholders have elected a
successor, by the affirmative vote of a majority of the remaining directors,
whether or not the remaining directors constitute a quorum; provided, however,
that if the vacant office was held by a director elected by a particular Voting
Group, only the holders of shares of that Voting Group or the remaining
directors elected by that Voting Group shall be entitled to fill the vacancy;
provided further, however, that if the vacant office was held by a director
elected by a particular Voting Group and there is no remaining director elected
by that Voting Group, the other remaining directors or director (elected by
another Voting Group or Groups) may fill the vacancy during an interim period
before the shareholders of the vacated director's Voting Group act to fill the
vacancy. A vacancy or vacancies in the Board of Directors may result from the
death, resignation, disqualification, or removal of any director, or from an
increase in the number of directors.

3.5 COMPENSATION. Directors may receive such compensation for
their services as directors as may be fixed by the Board of Directors from time
to time. A director may also serve the Corporation in one or more capacities
other than that of director and receive compensation for services rendered in
those other capacities.

3.6 COMMITTEES OF THE BOARD OF DIRECTORS. The Board of Directors
may designate from among its members an executive committee or one or more other
standing or ad hoc committees, each consisting of one or more directors, who
serve at the pleasure of the Board of Directors. Subject to the limitations
imposed by the Code, each committee shall (i) have the authority set forth in
the resolution establishing the committee or in any other resolution of the
Board of Directors specifying, enlarging, or limiting the authority of the
committee and (ii) conduct itself in accordance with the mechanical requirements
of this Article Three.

3.7 QUALIFICATION OF DIRECTORS. No person elected to serve as a
director of the Corporation shall assume office and begin serving unless and
until duly qualified to serve, as determined by reference to the Code, the
Articles of Incorporation, and any further eligibility requirements established
in these Bylaws.

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3.8 CERTAIN NOMINATION REQUIREMENTS. No person may be nominated
for election as a director at any annual or special meeting of shareholders
unless (a) the nomination has been or is being made pursuant to a recommendation
or approval of the Board of Directors of the Corporation or a properly
constituted committee of the Board of Directors previously delegated authority
to recommend or approve nominees for director; (b) the person is nominated by a
shareholder of the Corporation who is entitled to vote for the election of the
nominee at the subject meeting, and the nominating shareholder has furnished
written notice to the Secretary of the Corporation, at the Corporation's
principal office, not less than 60 days before the date of the meeting at which
the director(s) are to be elected or the proposal is to be considered; however,
if less than 70 days notice or prior public disclosure of the date of the
scheduled meeting is given or made, notice by the shareholder, to be timely,
must be delivered or received not later than the close of business on the tenth
day following the earlier of the day on which notice of the date of the meeting
is mailed to shareholders or public disclosure of the date of such meeting is
made and the notice (i) sets forth with respect to the person to be nominated
his or her name, age, business and residence addresses, principal business or
occupation during the past five years, any affiliation with or material interest
in the Corporation or any transaction involving the Corporation, and any
affiliation with or material interest in any person or entity having an interest
materially adverse to the Corporation, and (ii) is accompanied by the sworn or
certified statement of the shareholder that the nominee has consented to being
nominated and that the shareholder believes the nominee will stand for election
and will serve if elected; or (c) (i) the person is nominated to replace a
person previously identified as a proposed nominee (in accordance with the
provisions of subpart (b) of this Section 3.8) who has since become unable or
unwilling to be nominated or to serve if elected, (ii) the shareholder who
furnished such previous identification makes the replacement nomination and
delivers to the Secretary of the Corporation (at the time of or prior to making
the replacement nomination) an affidavit or other sworn statement affirming that
the shareholder had no reason to believe the original nominee would be so unable
or unwilling, and (iii) such shareholder also furnishes in writing to the
Secretary of the Corporation (at the time of or prior to making the replacement
nomination) the same type of information about the replacement nominee as
required by subpart (b) of this Section 3.8 to have been furnished about the
original nominee. The chairman of any meeting of shareholders at which one or
more directors are to be elected, for good cause shown and with proper regard
for the orderly conduct of business at the meeting, may waive in whole or in
part the operation of this Section 3.8.

ARTICLE FOUR

MEETINGS OF THE BOARD OF DIRECTORS

4.1 REGULAR MEETINGS. A regular meeting of the Board of Directors
shall be held in conjunction with each annual meeting of shareholders. In
addition, the Board of Directors may hold regular meetings at other times
established by prior resolution.

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4.2 SPECIAL MEETINGS. Special meetings of the Board of Directors
may be called by or at the request of the Chairman of the Board, the Chief
Executive Officer, the President, or any two directors in office at that time.

4.3 PLACE OF MEETINGS. Directors may hold their meetings at any
place in or outside the State of Georgia that the Board of Directors may
establish from time to time.

4.4 NOTICE OF MEETINGS. Directors need not be provided with notice
of any regular meeting of the Board of Directors. Unless waived in accordance
with Section 4.10, the Corporation shall give at least two days' notice to each
director of the date, time, and place of each special meeting. Notice of a
meeting shall be deemed to have been given to any director in attendance at any
prior meeting at which the date, time, and place of the subsequent meeting was
announced.

4.5 QUORUM At meetings of the Board of Directors, the greater of
(a) a majority of the directors then in office, or (b) one-third of the number
of directors fixed in accordance with these Bylaws shall constitute a quorum for
the transaction of business.

4.6 VOTE REQUIRED FOR ACTION. If a quorum is present when a vote
is taken, the vote of a majority of the directors present at the time of the
vote will be the act of the Board of Directors, unless the vote of a greater
number is required by the Code, the Articles of Incorporation, or these Bylaws.
A director who is present at a meeting of the Board of Directors when corporate
action is taken is deemed to have assented to the action taken unless (a) he or
she objects at the beginning of the meeting (or promptly upon his or her
arrival) to holding the meeting or transacting business at it; (b) his or her
dissent or abstention from the action taken is entered in the minutes of the
meeting; or (c) he or she delivers written notice of dissent or abstention to
the presiding officer of the meeting before its adjournment or to the
Corporation immediately after adjournment of the meeting. The right of dissent
or abstention is not available to a director who votes in favor of the action
taken.

4.7 PARTICIPATION BY CONFERENCE TELEPHONE. Members of the Board of
Directors may participate in a meeting of the Board by means of conference
telephone or similar communications equipment through which all persons
participating may hear and speak to each other. Participation in a meeting
pursuant to this Section 4.7 shall constitute presence in person at the meeting.

4.8 ACTION BY DIRECTORS WITHOUT A MEETING. Any action required or
permitted to be taken at any meeting of the Board of Directors may be taken
without a meeting if a written consent, describing the action taken, is signed
by each director and delivered to the Corporation for inclusion in the minutes
or filing with the corporate records. The consent may be executed in
counterpart, and shall have the same force and effect as a unanimous vote of the
Board of Directors at a duly convened meeting.

4.9 ADJOURNMENTS. A meeting of the Board of Directors, whether or
not a quorum is present, may be adjourned by a majority of the directors present
to reconvene at a specific time

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and place. It shall not be necessary to give notice to the directors of the
reconvened meeting or of the business to be transacted, other than by
announcement at the meeting that was adjourned, unless a quorum was not present
at the meeting that was adjourned, in which case notice shall be given to
directors in the same manner as for a special meeting. At any such reconvened
meeting at which a quorum is present, any business may be transacted that could
have been transacted at the meeting that was adjourned.

4.10 WAIVER OF NOTICE. A director may waive any notice required by
the Code, the Articles of Incorporation, or these Bylaws before or after the
date and time of the matter to which the notice relates, by a written waiver
signed by the director and delivered to the Corporation for inclusion in the
minutes or filing with the corporate records. Attendance by a director at a
meeting shall constitute waiver of notice of the meeting, except where a
director at the beginning of the meeting (or promptly upon his or her arrival)
objects to holding the meeting or to transacting business at the meeting and
does not thereafter vote for or assent to action taken at the meeting.

ARTICLE FIVE

OFFICERS

5.1 OFFICERS. The officers of the Corporation shall consist of a
President, a Secretary, and a Treasurer, and may include a Chief Executive
Officer separate from the President, each of whom shall be elected or appointed
by the Board of Directors. The Board of Directors may also elect a Chairman of
the Board from among its members. The Board of Directors from time to time may,
or may authorize the Chief Executive Officer or the President to, create and
establish other offices and the duties thereof and may, or may authorize the
Chief Executive Officer or the President to, elect or appoint, or authorize
specific senior officers to appoint, the persons who shall hold such other
offices, including one or more Vice Presidents (including Executive Vice
Presidents, Senior Vice Presidents, Assistant Vice Presidents, and the like),
one or more Assistant Secretaries, and one or more Assistant Treasurers. Whether
or not so provided by the Board of Directors, the Chairman of the Board, the
Chief Executive Officer or the President may appoint one or more Assistant
Secretaries, and one or more Assistant Treasurers. Any two or more offices may
be held by the same person.

5.2 TERM. Each officer shall serve at the pleasure of the Board of
Directors (or, if appointed by the Chief Executive Officer, the President, or a
senior officer pursuant to this Article Five, at the pleasure of the Board of
Directors, the Chief Executive Officer, the President, or the senior officer
authorized to have appointed the officer) until his or her death, resignation,
or removal, or until his or her replacement is elected or appointed in
accordance with this Article Five.

5.3 COMPENSATION. The compensation of all officers of the
Corporation shall be fixed by the Board of Directors or by a committee or
officer appointed by the Board of Directors. Officers may serve without
compensation.

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5.4 REMOVAL. All officers (regardless of how elected or appointed)
may be removed, with or without cause, by the Board of Directors, and any
officer appointed by the Chief Executive Officer, the President, or another
senior officer may also be removed, with or without cause, by the Chief
Executive Officer, the President, or by any senior officer authorized to have
appointed the officer to be removed. Removal will be without prejudice to the
contract rights, if any, of the person removed, but shall be effective
notwithstanding any damage claim that may result from infringement of such
contract rights.

5.5 CHAIRMAN OF THE BOARD. The Chairman of the Board (if there be
one) shall preside at and serve as chairman of meetings of the shareholders and
of the Board of Directors (unless another person is selected under Section 2.9
to act as chairman). The Chairman of the Board shall perform other duties and
have other authority as may from time to time be delegated by the Board of
Directors.

5.6 CHIEF EXECUTIVE OFFICER. The Chief Executive Officer shall be
charged with the general and active management of the Corporation, shall see
that all orders and resolutions of the Board of Directors are carried into
effect, shall have the authority to select and appoint employees and agents of
the Corporation, and shall, in the absence or disability of the Chairman of the
Board, perform the duties and exercise the powers of the Chairman of the Board.
The Chief Executive Officer shall perform any other duties and have any other
authority as may be delegated from time to time by the Board of Directors, and
shall be subject to the limitations fixed from time to time by the Board of
Directors.

5.7 PRESIDENT. If there shall be no separate Chief Executive
Officer of the Corporation, then the President shall be the chief executive
officer of the Corporation and shall have all the duties and authority given
under these Bylaws to the Chief Executive Officer. The President shall otherwise
be the chief operating officer of the Corporation and shall, subject to the
authority of the Chief Executive Officer, have responsibility for the conduct
and general supervision of the business operations of the Corporation. The
President shall perform such other duties and have such other authority as may
from time to time be delegated by the Board of Directors or the Chief Executive
Officer. In the absence or disability of the Chief Executive Officer, the
President shall perform the duties and exercise the powers of the Chief
Executive Officer.

5.8 VICE PRESIDENTS. The Vice President (if there be one) shall,
in the absence or disability of the President, perform the duties and exercise
the powers of the President, whether the duties and powers are specified in
these Bylaws or otherwise. If the Corporation has more than one Vice President,
the one designated by the Board of Directors or the Chief Executive Officer (in
that order of precedence) shall act in the event of the absence or disability of
the President. Vice Presidents shall perform any other duties and have any other
authority as from time to time may be delegated by the Board of Directors, the
Chief Executive Officer, or the President.

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5.9 SECRETARY. The Secretary shall be responsible for preparing
minutes of the meetings of shareholders, directors, and committees of directors
and for authenticating records of the Corporation. The Secretary or any
Assistant Secretary shall have authority to give all notices required by law or
these Bylaws. The Secretary shall be responsible for the custody of the
corporate books, records, contracts, and other documents. The Secretary or any
Assistant Secretary may affix the corporate seal to any lawfully executed
documents requiring it, may attest to the signature of any officer of the
Corporation, and shall sign any instrument that requires the Secretary's
signature. The Secretary or any Assistant Secretary shall perform any other
duties and have any other authority as from time to time may be delegated by the
Board of Directors, the Chief Executive Officer, or the President.

5.10 TREASURER. Unless otherwise provided by the Board of
Directors, the Treasurer shall be responsible for the custody of all funds and
securities belonging to the Corporation and for the receipt, deposit, or
disbursement of these funds and securities under the direction of the Board of
Directors. The Treasurer shall cause full and true accounts of all receipts and
disbursements to be maintained and shall make reports of these receipts and
disbursements to the Board of Directors, the Chief Executive Officer and
President upon request. The Treasurer or Assistant Treasurer shall perform any
other duties and have any other authority as from time to time may be delegated
by the Board of Directors, the Chief Executive Officer, or the President.

ARTICLE SIX

DISTRIBUTIONS AND DIVIDENDS

Unless the Articles of Incorporation provide otherwise, the Board of
Directors, from time to time in its discretion, may authorize or declare
distributions or share dividends in accordance with the Code.

ARTICLE SEVEN

7.1 SHARE CERTIFICATES. The interest of each shareholder in the
Corporation shall be evidenced by a certificate or certificates representing
shares of the Corporation, which shall be in such form as the Board of Directors
from time to time may adopt in accordance with the Code. Share certificates
shall be in registered form and shall indicate the date of issue, the name of
the Corporation, that the Corporation is organized under the laws of the State
of Georgia, the name of the shareholder, and the number and class of shares and
designation of the series, if any, represented by the certificate. Each
certificate shall be signed by the President or a Vice President (or in lieu
thereof, by the Chairman of the Board or Chief Executive Officer, if there be
one) and may be signed by the Secretary or an Assistant Secretary; provided,
however, that where the certificate is signed (either manually or by facsimile)
by a transfer agent, or registered by a registrar, the signatures of those
officers may be facsimiles.

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7.2 RIGHTS OF CORPORATION WITH RESPECT TO REGISTERED OWNERS. Prior
to due presentation for transfer of registration of its shares, the Corporation
may treat the registered owner of the shares (or the beneficial owner of the
shares to the extent of any rights granted by a nominee certificate on file with
the Corporation pursuant to any procedure that may be established by the
Corporation in accordance with the Code) as the person exclusively entitled to
vote the shares, to receive any dividend or other distribution with respect to
the shares, and for all other purposes; and the Corporation shall not be bound
to recognize any equitable or other claim to or interest in the shares on the
part of any other person, whether or not it has express or other notice of such
a claim or interest, except as otherwise provided by law.

7.3 TRANSFERS OF SHARES. Transfers of shares shall be made upon
the books of the Corporation kept by the Corporation or by the transfer agent
designated to transfer the shares, only upon direction of the person named in
the certificate or by an attorney lawfully constituted in writing. Before a new
certificate is issued, the old certificate shall be surrendered for cancellation
or, in the case of a certificate alleged to have been lost, stolen, or
destroyed, the provisions of Section 7.5 of these Bylaws shall have been
complied with.

7.4 DUTY OF CORPORATION TO REGISTER TRANSFER. Notwithstanding any
of the provisions of Section 7.3 of these Bylaws, the Corporation is under a
duty to register the transfer of its shares only if: (a) the share certificate
is endorsed by the appropriate person or persons; (b) reasonable assurance is
given that each required endorsement is genuine and effective; (c) the
Corporation has no duty to inquire into adverse claims or has discharged any
such duty; (d) any applicable law relating to the collection of taxes has been
complied with; (e) the transfer is in fact rightful or is to a bona fide
purchaser; and (f) the transfer is in compliance with applicable provisions of
any transfer restrictions of which the Corporation shall have notice.

7.5 LOST, STOLEN, OR DESTROYED CERTIFICATES. Any person claiming a
share certificate to be lost, stolen, or destroyed shall make an affidavit or
affirmation of this claim in such a manner as the Corporation may require and
shall, if the Corporation requires, give the Corporation a bond of indemnity in
form and amount, and with one or more sureties satisfactory to the Corporation,
as the Corporation may require, whereupon an appropriate new certificate may be
issued in lieu of the one alleged to have been lost, stolen or destroyed.

7.6 FIXING OF RECORD DATE. For the purpose of determining
shareholders (a) entitled to notice of or to vote at any meeting of shareholders
or, if necessary, any adjournment thereof, (b) entitled to receive payment of
any distribution or dividend, or (c) for any other proper purpose, the Board of
Directors may fix in advance a date as the record date. The record date may not
be more than 70 days (and, in the case of a notice to shareholders of a
shareholders' meeting, not less than 10 days) prior to the date on which the
particular action, requiring the determination of shareholders, is to be taken.
A separate record date may be established for each Voting Group entitled to vote
separately on a matter at a meeting. A determination of shareholders of record
entitled to notice of or to vote at a meeting of shareholders shall apply to any
adjournment of the meeting, unless the Board of Directors shall fix a new record
date for the

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reconvened meeting, which it must do if the meeting is adjourned to a date more
than 120 days after the date fixed for the original meeting.

7.7 RECORD DATE IF NONE FIXED. If no record date is fixed as
provided in Section 7.6, then the record date for any determination of
shareholders that may be proper or required by law shall be, as appropriate, the
date on which notice of a shareholders' meeting is mailed, the date on which the
Board of Directors adopts a resolution declaring a dividend or authorizing a
distribution, or the date on which any other action is taken that requires a
determination of shareholders.

ARTICLE EIGHT

INDEMNIFICATION

8.1 INDEMNIFICATION OF DIRECTORS. The Corporation shall indemnify
and hold harmless any director of the Corporation (an "Indemnified Person") who
was or is a party, or is threatened to be made a party, to any threatened,
pending or completed action, suit, or proceeding, whether civil, criminal,
administrative, or investigative, whether formal or informal, including any
action or suit by or in the right of the Corporation (for purposes of this
Article Eight, collectively, a "Proceeding") because he or she is or was a
director, officer, employee, or agent of the Corporation, against any judgment,
settlement, penalty, fine, or reasonable expenses (including, but not limited
to, attorneys' fees and disbursements, court costs, and expert witness fees)
incurred with respect to the Proceeding (for purposes of this Article Eight, a
"Liability"), provided, however, that no indemnification shall be made for: (a)
any appropriation by a director, in violation of the director's duties, of any
business opportunity of the corporation; (b) any acts or omissions of a director
that involve intentional misconduct or a knowing violation of law; (c) the types
of liability set forth in Code Section 14-2-832; or (d) any transaction from
which the director received an improper personal benefit.

8.2 INDEMNIFICATION OF OTHERS. The Board of Directors shall have
the power to cause the Corporation to provide to officers, employees, and agents
of the Corporation all or any part of the right to indemnification permitted for
such persons by appropriate provisions of the Code. Persons to be indemnified
may be identified by position or name, and the right of indemnification may be
different for each of the persons identified. Each officer, employee, or agent
of the Corporation so identified shall be an "Indemnified Person" for purposes
of the provisions of this Article Eight.

8.3 OTHER ORGANIZATIONS. The Corporation shall provide to each
director, and the Board of Directors shall have the power to cause the
Corporation to provide to any officer, employee, or agent, of the Corporation
who is or was serving at the Corporation's request as a director, officer,
partner, trustee, employee, or agent of another corporation, partnership, joint
venture, trust, employee benefit plan, or other enterprise all or any part of
the right to indemnification and other rights of the type provided under
Sections 8.1, 8.2, 8.4, and 8.10 of this Article Eight (subject to the
conditions, limitations, and obligations specified in those

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Sections) permitted for such persons by appropriate provisions of the Code.
Persons to be indemnified may be identified by position or name, and the right
of indemnification may be different for each of the persons identified. Each
person so identified shall be an "Indemnified Person" for purposes of the
provisions of this Article Eight.

8.4 ADVANCES. Expenses (including, but not limited to, attorneys'
fees and disbursements, court costs, and expert witness fees) incurred by an
Indemnified Person in defending any Proceeding of the kind described in Sections
8.1 or 8.3, as to an Indemnified Person who is a director of the Corporation, or
in Sections 8.2 or 8.3, as to other Indemnified Persons, if the Board of
Directors has specified that advancement of expenses be made available to any
such Indemnified Person, shall be paid by the Corporation in advance of the
final disposition of such Proceeding as set forth herein. The Corporation shall
promptly pay the amount of such expenses to the Indemnified Person, but in no
event later than 10 days following the Indemnified Person's delivery to the
Corporation of a written request for an advance pursuant to this Section 8.4,
together with a reasonable accounting of such expenses; provided, however, that
the Indemnified Person shall furnish the Corporation a written affirmation of
his or her good faith belief that he or she has met the applicable standard of
conduct and a written undertaking and agreement to repay to the Corporation any
advances made pursuant to this Section 8.4 if it shall be determined that the
Indemnified Person is not entitled to be indemnified by the Corporation for such
amounts. The Corporation may make the advances contemplated by this Section 8.4
regardless of the Indemnified Person's financial ability to make repayment. Any
advances and undertakings to repay pursuant to this Section 8.4 may be unsecured
and interest-free.

8.5 NON-EXCLUSIVITY. Subject to any applicable limitation imposed
by the Code or the Articles of Incorporation, the indemnification and
advancement of expenses provided by or granted pursuant to this Article Eight
shall not be exclusive of any other rights to which a person seeking
indemnification or advancement of expenses may be entitled under any provision
of the Articles of Incorporation, or any Bylaw, resolution, or agreement
specifically or in general terms approved or ratified by the affirmative vote of
holders of a majority of the shares entitled to be voted thereon.

8.6 INSURANCE. The Corporation shall have the power to purchase
and maintain insurance on behalf of any person who is or was a director,
officer, employee, or agent of the Corporation, or who, while serving in such a
capacity, is also or was also serving at the request of the Corporation as a
director, officer, trustee, partner, employee, or agent of any corporation,
partnership, joint venture, trust, employee benefit plan, or other enterprise,
against any Liability that may be asserted against or incurred by him or her in
any such capacity, or arising out of his or her status as such, whether or not
the Corporation would have the power to indemnify him or her against such
liability under the provisions of this Article Eight.

8.7 NOTICE. If the Corporation indemnifies or advances expenses to
a director under any of Sections 14-2-851 through 14-2-854 of the Code in
connection with a Proceeding by or in the right of the Corporation, the
Corporation shall, to the extent required by Section 14-2-1621 or

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any other applicable provision of the Code, report the indemnification or
advance in writing to the shareholders with or before the notice of the next
shareholders' meeting.

8.8 SECURITY. The Corporation may designate certain of its assets
as collateral, provide self-insurance, establish one or more indemnification
trusts, or otherwise secure or facilitate its ability to meet its obligations
under this Article Eight, or under any indemnification agreement or plan of
indemnification adopted and entered into in accordance with the provisions of
this Article Eight, as the Board of Directors deems appropriate.

8.9 AMENDMENT. Any amendment to this Article Eight that limits or
otherwise adversely affects the right of indemnification, advancement of
expenses, or other rights of any Indemnified Person hereunder shall, as to such
Indemnified Person, apply only to Proceedings based on actions, events, or
omissions (collectively, "Post Amendment Events") occurring after such amendment
and after delivery of notice of such amendment to the Indemnified Person so
affected. Any Indemnified Person shall, as to any Proceeding based on actions,
events, or omissions occurring prior to the date of receipt of such notice, be
entitled to the right of indemnification, advancement of expenses, and other
rights under this Article Eight to the same extent as if such provisions had
continued as part of the Bylaws of the Corporation without such amendment. This
Section 8.9 cannot be altered, amended, or repealed in a manner effective as to
any Indemnified Person (except as to Post Amendment Events) without the prior
written consent of such Indemnified Person.

8.10 AGREEMENTS. The provisions of this Article Eight shall be
deemed to constitute an agreement between the Corporation and each Indemnified
Person hereunder. In addition to the rights provided in this Article Eight, the
Corporation shall have the power, upon authorization by the Board of Directors,
to enter into an agreement or agreements providing to any Indemnified Person
indemnification rights substantially similar to those provided in this Article
Eight.

8.11 CONTINUING BENEFITS. The rights of indemnification and
advancement of expenses permitted or authorized by this Article Eight shall,
unless otherwise provided when such rights are granted or conferred, continue as
to a person who has ceased to be a director, officer, employee, or agent and
shall inure to the benefit of the heirs, executors, and administrators of such
person.

8.12 SUCCESSORS. For purposes of this Article Eight, the term
"Corporation" shall include any corporation, joint venture, trust, partnership,
or unincorporated business association that is the successor to all or
substantially all of the business or assets of this Corporation, as a result of
merger, consolidation, sale, liquidation, or otherwise, and any such successor
shall be liable to the persons indemnified under this Article Eight on the same
terms and conditions and to the same extent as this Corporation.

8.13 SEVERABILITY. Each of the Sections of this Article Eight, and
each of the clauses set forth herein, shall be deemed separate and independent,
and should any part of any such Section or clause be declared invalid or
unenforceable by any court of competent jurisdiction,

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<PAGE> 19
such invalidity or unenforceability shall in no way render invalid or
unenforceable any other part thereof or any separate Section or clause of this
Article Eight that is not declared invalid or unenforceable.

8.14 ADDITIONAL INDEMNIFICATION. In addition to the specific
indemnification rights set forth herein, the Corporation shall indemnify each of
its directors and such of its officers as have been designated by the Board of
Directors to the full extent permitted by action of the Board of Directors
without shareholder approval under the Code or other laws of the State of
Georgia as in effect from time to time.

ARTICLE NINE

MISCELLANEOUS

9.1 INSPECTION OF BOOKS AND RECORDS. The Board of Directors shall
have the power to determine which accounts, books, and records of the
Corporation shall be available for shareholders to inspect or copy, except for
those books and records required by the Code to be made available upon
compliance by a shareholder with applicable requirements, and shall have the
power to fix reasonable rules and regulations (including confidentiality
restrictions and procedures) not in conflict with applicable law for the
inspection and copying of accounts, books, and records that by law or by
determination of the Board of Directors are made available. Unless required by
the Code or otherwise provided by the Board of Directors, a shareholder of the
Corporation holding less than two percent of the total shares of the Corporation
then outstanding shall have no right to inspect the books and records of the
Corporation.

9.2 FISCAL YEAR. The Board of Directors is authorized to fix the
fiscal year of the Corporation and to change the fiscal year from time to time
as it deems appropriate.

9.3 CORPORATE SEAL. The corporate seal will be in such form as the
Board of Directors may from time to time determine. The Board of Directors may
authorize the use of one or more facsimile forms of the corporate seal. The
corporate seal need not be used unless its use is required by law, by these
Bylaws, or by the Articles of Incorporation.

9.4 ANNUAL STATEMENTS. Not later than four months after the close
of each fiscal year, and in any case prior to the next annual meeting of
shareholders, the Corporation shall prepare (a) a balance sheet showing in
reasonable detail the financial condition of the Corporation as of the close of
its fiscal year, and (b) a profit and loss statement showing the results of its
operations during its fiscal year. Upon receipt of written request, the
Corporation promptly shall mail to any shareholder of record a copy of the most
recent such balance sheet and profit and loss statement, in such form and with
such information as the Code may require.

9.5 NOTICE. (a) Whenever these Bylaws require notice to be given
to any shareholder or to any director, the notice may be given by mail, in
person, by courier delivery, by telephone, or by telecopier, telegraph, or
similar electronic means. Whenever notice is given to a

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shareholder or director by mail, the notice shall be sent by depositing the
notice in a post office or letter box in a postage-prepaid, sealed envelope
addressed to the shareholder or director at his or her address as it appears on
the books of the Corporation. Any such written notice given by mail shall be
effective: (i) if given to shareholders, at the time the same is deposited in
the United States mail; and (ii) in all other cases, at the earliest of (x) when
received or when delivered, properly addressed, to the addressee's last known
principal place of business or residence, (y) five days after its deposit in the
mail, as evidenced by the postmark, if mailed with first-class postage prepaid
and correctly addressed, or (z) on the date shown on the return receipt, if sent
by registered or certified mail, return receipt requested, and the receipt is
signed by or on behalf of the addressee. Whenever notice is given to a
shareholder or director by any means other than mail, the notice shall be deemed
given when received.

(b) In calculating time periods for notice, when a period of time
measured in days, weeks, months, years, or other measurement of time is
prescribed for the exercise of any privilege or the discharge of any duty, the
first day shall not be counted but the last day shall be counted.

9.6 ELECTION OF "FAIR PRICE" STATUTE. The provisions of Sections
14-2-1110 through 14-2-1113 of the Code, as they may be amended from time to
time, shall apply to the Corporation, to the extent permitted by the Code.

9.7 ELECTION OF "BUSINESS COMBINATION" STATUTE. The provisions of
Section 14-2-1131 through 14-2-1133 of the Code, as they may be amended from
time to time, shall apply to the Corporation, to the extent permitted by the
Code.

ARTICLE TEN

AMENDMENTS

Except as otherwise provided below or under the Code, the Board of
Directors shall have the power to alter, amend, or repeal these Bylaws or adopt
new Bylaws. Notwithstanding any other provision of these Bylaws, the
Corporation's Articles of Incorporation or law, neither Section 2.3, 2.14 or
3.8, nor Article Eight hereof nor this Article Ten may be amended or repealed
except upon the affirmative vote of holders of at least a majority of the total
number of votes of the then outstanding shares of capital stock of the Company
that are entitled to vote generally in the election of directors, voting
together as a single class. Any Bylaws adopted by the Board of Directors may be
altered, amended, or repealed, and new Bylaws adopted, by the shareholders. The
shareholders may prescribe in adopting any Bylaw or Bylaws that the Bylaw or
Bylaws so adopted shall not be altered, amended, or repealed by the Board of
Directors.

Dated: __________, 1998.

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<PAGE> 1
EXHIBIT 10.1
TWO PARKWAY CENTER

LEASE AGREEMENT

THIS LEASE AGREEMENT (the "Lease"), dated as of 11/8, 1990, made by and
between Two Park, Inc., having La Salle Partners Asset Management Limited, a
Delaware limited partnership, as its duly authorized Agent (the "Landlord") and
E3 Associates, Ltd. (the "Tenant").

W I T N E S S E T H:

DEFINITIONS

Landlord and Tenant covenant and agree that for purposes of this Lease,
the following terms as indicated by the initial capitalization thereof, shall
have the meanings specified below for each:

1.1 Base Rental. The Base Rental to be paid by Tenant to Landlord
as annual rent during the Lease Term shall be the Amount specified in Special
Stipulations 1 and 2 subject to increase under Paragraph 4.2 hereof.

1.2 Commitment Deposit. [Intentionally Omitted].

1.3 Premises. Terms used in defining Premises are:

(a) The term "Building" shall mean 1800 Parkway Place located
in the City of Marietta, Cobb County, Georgia.

(b) The term "Premises" shall mean the portion of the Building
located on floor six, Suite 600 which is outlined on the floor plan(s) attached
hereto as Exhibit A.

1.4 Rentable Area of the Premises. The term "Rentable Area of the
Premises" shall mean 12,147 square feet.

1.5 Security Deposit. Twenty Two Thousand Two Hundred and Sixty
Nine and 50/100 Dollars ($22,269.50).

1.6 Tenant's Percentage Share of Increases In Operating Expenses.
Terms used in defining Tenant's Percentage Share of Increases in Operating
Expenses are:

(a) The Rentable Area of the Building is 227,003 square feet.

(b) The term "Tenant's Percentage Share" means 5.351 percent.
Landlord and Tenant acknowledge that Tenant's Percentage Share has been obtained
by dividing the Rentable Area of the Premises by the Rentable Area of the
Building, and multiplying such quotient by 100.

(d) The term "Operating Expenses" as used in this Lease shall
mean the following costs, expenses, and taxes:

<PAGE> 2

(i) Costs and expenses paid or incurred by
Landlord for the maintenance and repair of the Building and the personal
property used in-connection therewith, including but not limited to (A) the
heating, ventilating, and air conditioning equipment, (B) plumbing and
electrical systems and equipments, (C) light bulbs and broken glass, including
replacement thereof, and (D) elevators and escalators;

(ii) Cleaning and janitorial costs and expenses,
including window cleaning expenses, for the Building;

(iii) Landscaping and grounds maintenance costs
and expenses;

(iv) Utility costs and expenses including, but not
limited to, electricity, gas, steam, other fuels and forms of power or energy,
water charges, sewer and waste disposal;

(v) Costs and expenses of redecorating, painting,
and carpeting the common areas of the Building; provided, however, that, except
as specified in items (vi) and (x) hereof, the cost of structural changes to
the Building which should be capitalized in accordance with sound accounting
principles shall not be allocated or charged to the Premises;

(vi) Costs of all repairs, alterations, additions,
changes, replacements, and other items required by any law or governmental
regulation imposed after the date of this Lease, regardless of whether such
costs, when incurred, are classified as capital expenditures;

(vii) Cost of wages and salaries of all persons
engaged in the operation, maintenance and repair of the Building, and so-called
fringe benefits, including social security taxes, unemployment insurance taxes,
costs for providing coverage for disability benefits, cost of any pensions,
hospitalization, welfare or retirement plans, or any other similar or like
expense incurred under the provisions of any collective bargaining agreement,
costs of uniforms, and all other costs reasonable or expenses that the Landlord
pays to or on behalf of the employees engaged in the operation, maintenance and
repair of the Building;

(viii) Charges of any independent contractor who,
under contract with the Landlord or its manager or representative, does any of
the work of directly operating, maintaining or repairing the Building or of
providing any of the services and materials described in this Paragraph 1.6(d);

(ix) Reasonable Legal and accounting expenses,
including, but not limited to, such expenses as related to seeking or obtaining
reductions in and/or refunds of real estate taxes;

(x) Amortization, with interest, of capital
expenditures for capital improvements made by Landlord after completion of the
Building where such capital improvements are for the purpose of, or result in,
reducing Operating Expenses;

(xi) Landlord's reasonable insurance costs and
expenses for all types of insurance carried by Landlord with respect to the
Building;

(xii) Reasonable Security service costs and
expenses;

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<PAGE> 3

(xiii) Reasonable Management fees and expenses;

(xiv) Such other reasonable expenses paid by
Landlord, from time to time, in connection with the operation and maintenance of
the Building as are typically incurred by an operator and manager of a building
comparable to the Building, except that all costs of special services rendered
to particular tenants of the Building, which are paid by such tenants, shall not
be included in Operating Expenses; and

(xv) The following taxes: (A) personal property taxes
(attributable to the year in which paid) imposed upon the furniture, fixtures,
machinery, equipment, apparatus, systems, and appurtenances used in connection
with the Building for the operation thereof, and (B) real estate taxes,
assessments, sewer rents, rates, and charges, transit taxes, taxes based upon
the receipt of rent and any other federal, state, or local governmental charge,
general, special, ordinary, or extraordinary (but not including income or
franchise taxes or any other taxes imposed upon or measured by Landlord's income
or profits, unless the same shall be imposed in lieu of real estate taxes) which
may now or hereafter be levied or assessed against the Building and the land
underlying the Building or the rents derived from the Building (in the case of
special taxes or assessments which may be payable in installments, only the
amount of 'each installment paid during a calendar year shall be included in the
taxes for that year).

(e) The term "Base Operating Expenses" shall mean the
Operating Expenses paid or incurred by Landlord in the Base Year. If the
Building was not ninety-five percent (95%) occupied throughout the Base Year,
then the Base Operating Expenses shall be an amount which fairly reflects what
the Operating Expenses would have been had the Building been ninety-five percent
(95%) occupied throughout the Base Year.

1.7 Lease Term. The Lease Term shall commence on December 1, 1990
(which shall be referred to herein as the "Commencement Date") and shall end at
midnight on November 30, 1995 (which shall be referred to herein as the
"Expiration Date").

1.8 Notice Addresses.

As to Landlord: With Copy to:

Two Park, Inc. LaSalle Partners Asset Management Limited
c/o LaSalle Advisors, Ltd. One Parkway Center
111 South LaSalle Street 1850 Parkway Place, Suite 327
Chicago Illinois 60603 Marietta, Georgia 30067
Attn: Portfolio Manager

As to Tenant:
E3 Associates, Ltd.
1800 Parkway Place, Suite 235
Marietta, Georgia 30067
ATTN: Chairman

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II.

TERM

2.1 Premises. Landlord, in consideration of the covenants and
agreements to be performed by Tenant, and upon and subject to the terms and
conditions of this Lease, does hereby rent and lease unto Tenant, and Tenant
does hereby rent and lease the Premises from Landlord for the Lease Term. This
Lease shall create the relationship of landlord and tenant between Landlord and
Tenant; no estate shall pass out of Landlord, and Tenant has only a usufruct
which is not subject to levy and sale.

2.2 Term. Tenant takes and accepts the Premises from Landlord in its
present condition and as suited for the use intended by Tenant, except for such
improvements as may be expressly provided for in the Tenant Improvement
Agreement, referenced in Paragraph 5.1 which is incorporated herein by this
reference. If, for any reason whatsoever the Premises are not substantially
completed by the Commencement Date or if Landlord, for any reason whatsoever,
cannot deliver possession of the Premises to Tenant by the Commencement Date,
this Lease shall not be void or voidable, nor shall Landlord be liable to Tenant
for any resulting loss or damages resulting therefrom. No delay in delivery of
possession or extension of the Commencement Date shall operate to extend the
Expiration Date or to relieve Tenant of Tenant's obligations to Landlord as
provided in this Lease. In the event the Premises are not completed on December
1, 1990 due solely to the fault of Landlord or it's agents, without any
contributing delays of Tenant, then both the Commencement Date and Expiration
Date shall be extended by the number of days occurring between December 1, 1990
and the date the Premises are completed and actually made available for Tenant's
occupancy.

2.3 Removal of Tenant's Personal Property. Before the termination of
this Lease, Tenant shall remove from the Premises all its personal property
located in the Premises which this Lease allows Tenant to remove and peaceably
surrender such Premises and the keys thereto to Landlord in the same condition
as at the beginning of this Lease, only natural wear and tear excepted. Tenant
shall have no right to remove any fixtures, improvements, or attached equipment
(except those installed by Tenant, and Tenant is required to repair any damage
resulting from any such removal) from the Premises at the termination of this
Lease, and said items shall be deemed the property of Landlord. Such property of
Tenant as it fails to remove either from the Premises or the Building after the
termination of this Lease shall be considered as abandoned by Tenant and may be
disposed of by Landlord in any manner whatsoever without accounting to Tenant
for same or being liable in any way to Tenant for such disposition.

2.4 Holding over. In no event shall there by any renewal of this Lease
by operation of law, and if Tenant remains in possession of the Premises after
the termination of this Lease and without a new lease executed by Landlord and
Tenant, Tenant shall be deemed to be occupying the Premises as a Tenant at
sufference at an amount equal to one hundred and fifty percent (150%) of the
Base Rental and additional rent provided for in this Lease and otherwise subject
to all the covenants and provisions of this Lease insofar as the same are
applicable to a month-to-month tenancy.

2.5 Tenant Acceptance Agreement. Within twenty (20) days after the
Premises have been substantially completed in accordance with the Tenant
Improvement Agreement, Tenant will execute and deliver to Landlord a Tenant
Acceptance Agreement in the form attached hereto as Exhibit "B". Tenant may
state in such Tenant Acceptance Agreement any defects in the Premises remaining
to be repaired or completed by Landlord, and Tenant, by such declaration, shall
preserve its objection to such listed

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<PAGE> 5

defects. Tenant shall have waived objection to any defects not specifically
enumerated in a Tenant Acceptance Agreement delivered within said twenty (20)
day period, except for latent defects not discoverable by reasonable diligence
of Tenant.

III.

ASSIGNMENT AND SUBLETTING

3.1 Assignment and Subletting Procedures.

(a) The Tenant shall not, without the Landlord's prior written
consent, (i) assign, convey, mortgage, pledge, encumber, or otherwise transfer
(whether voluntarily, by operation of law, or otherwise) this Lease or any
interest under it; (ii) allow any transfer thereof or any lien upon Tenant's '
interest by operation of law; (iii) sublet the Premises or any part thereof; and
(iv) permit the use or occupancy of the Premises or any part thereof by anyone
other than Tenant, and any attempt to consummate any of the foregoing without
Landlord's consent shall be void.

(b) Notwithstanding anything herein to the contrary, if at any
time or from time to time during the Lease Term, Tenant desires to sublet the
Premises or assign the Lease with respect to all or part of the Premises, Tenant
shall notify Landlord in writing (hereinafter referred to in this Paragraph
3.1(b) as the "Notice") of the terms of the proposed subletting or assignment,
the identity of the proposed assignee or sublessee, the area proposed to be
sublet or covered by the assignment, and such other information as Landlord may
request, to evaluate Tenant's request to assign or sublet. Landlord shall then
have the option either (i) to sublet from Tenant such space (hereinafter
referred to as "Sublet Space") as provided in Paragraph 3.1(c) below; (ii) to
terminate this Lease as provided in Paragraph 3.1(d) below; or (iii) to review
such proposed assignment or sublease for approval as set forth below in
Paragraph 3.1(e) below. The option to sublet, to terminate, or to review, as the
case may be, shall be exercisable by Landlord in writing within a period of
thirty (30) calendar days after receipt of the Notice.

(c) In the event Landlord exercises the option to sublet the
Sublet Space provided under Paragraph 3.1(b)(i) above, then (i) Landlord shall
sublet the Sublet Space at the same Base Rental and additional rent as Tenant is
required to pay under this Lease for the same space; and (ii) the term of the
subletting from the Tenant to Landlord shall be the term set forth in the Notice
(which shall not be longer than the then current Lease Term unless Landlord
expressly agrees in writing that any extension or renewal option contained in
this Lease will apply to such Sublet Space) and shall be on such terms and
conditions as are contained in this Lease to the extent applicable, except that
the Landlord shall have the right to further sublet the Sublet Space.

(d) If Landlord elects to terminate this Lease under Paragraph
3.1(b)(ii) then, (i) if the Sublet Space constitutes the entire Premises, then
this Lease shall terminate on the date set forth in Landlord's notice to Tenant,
which shall be within thirty (30) to ninety (90) days after the date of such
notice; and (ii) if the Sublet Space does not constitute the entire Promises,
then this Lease shall terminate as to that portion of the Premises which is the
Sublet Space on the date set forth in Landlord's notice to Tenant (which date
shall be within thirty (30) to ninety (90) days after the date of such notice)
and as to that portion of the Premises which is not part of the Sublet Space,
this Lease shall remain in full force and effect except that the Base Rental and
additional rent shall be reduced proportionately based on the reduction in the
Rentable Area of the Premises remaining subject to the Lease.

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<PAGE> 6

(e) If Landlord fails to exercise either its option to sublet
or its option to terminate the Lease as set forth above within the said thirty
(30) day period or elects to review the proposed assignment or sublease for
approval, Tenant shall submit to Landlord within twenty (20) calendar days after
said period a copy of the proposed assignment or sublease and such additional
information concerning the proposed assignee or sublessee, as may be reasonably
requested by Landlord for Landlord's review. If Landlord, in its sole
discretion, approves in writing the terms of the proposed assignment or sublease
and the proposed assignee or sublessee, but a fully executed counterpart of such
assignment or sublease is not delivered to Landlord within sixty (60) calendar
days after the date of Landlord's written approval, then Landlord's approval of
the proposed assignment or sublease shall be deemed null and void and Tenant
shall subsequently comply with all the conditions of this Paragraph 3.1 as if
the Notice and options hereinabove referred to had not been given and received.

(f) Notwithstanding the giving by Landlord of its consent to
any assignment or sublease with respect to the Premises, no assignee or
sublessee may exercise any expansion option, right of first refusal option, or
renewal option under this Lease except in accordance with a separate written
agreement entered into directly between such assignee or sublessee and Landlord.

(g) Tenant agrees to pay to Landlord, on demand, reasonable
costs incurred by Landlord not to exceed $500.00 in connection with any request
by Tenant for Landlord to consent to any assignment or subletting by Tenant.

(h) Any transfer after the date hereof, whether to one or more
persons or entities and whether at one or more different times, of a controlling
interest in Tenant (regardless whether Tenant is a corporation, partnership, or
other entity), whether voluntarily, by operation of law, or otherwise, shall
deemed an assignment of this Lease within the meaning of this Paragraph 3.1.

(i) If, with the consent of the Landlord, this Lease is
assigned or the Premises or any part thereof is sublet or occupied by anybody
other than Tenant, Landlord may, after default by Tenant, collect rent from the
assignee, subtenant or occupant, and apply the net amount collected to the Base
Rental and additional rent herein reserved, but no such assignment, subletting,
occupancy, or collection shall be deemed (i) a waiver of any of Tenant's
covenants contained in this Lease, (ii) the acceptance by Landlord of the
assignee, subtenant, or occupant as Tenant, or (iii) a release of Tenant from
further performance by Tenant of its covenants under this Lease.

IV.

RENT, RENT ADJUSTMENT, AND DEPOSITS

4.1 Base Rental. Tenant shall pay the Base Rental to Landlord as annual
rent during the Lease Term without prior demand or setoff. The Base Rental shall
be paid in equal monthly installments in advance on the first day of every
calendar month during the Lease Term. A prorated monthly installment, based on a
thirty (30) day month, shall be paid in advance (i) on the Commencement Date for
any fraction of a month if the Lease Term begins on any day other than the first
day of any month and (ii) on the first day of the final month of the Lease Term
for any fraction of a month if the Lease Term shall terminate on any day other
than the last day of any month.

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4.2 Base Rental Adjustment During the Lease Term.

(a) The amount of the Base Rental specified in Section 1.1 of
this Lease shall be increased at the end of each calendar year during the Lease
Term for the following calendar year effective January 1 of said year by an
amount equal to the product computed by multiplying the then in force Base
Rental times fifty percent (50%) of the percentage increase in the Index for the
month of December of the immediately preceding calendar year. As soon as
reasonably practicable after each December 31 during the Lease Term, Landlord
shall prepare a statement reflecting the computations outlined above and the
resulting new amount of Base Rental, which shall become effective with the next
due monthly installment of Base Rental and shall remain in effect until the next
adjustment pursuant to this Paragraph 4.2 is made. Within ten (10) days
following receipt of Landlord's statement, Tenant agrees to pay the increases in
Base Rental which accrued from January 1 during preparation of said statement.
In the event the Index for December of the year of proposed adjustment is less
than the Index for December of the immediately preceding calendar year, then
there shall be no adjustment to Base Rental for that calendar year, but Base
Rental (as previously adjusted) shall remain in effect until the following
December at which time (and at each subsequent December) this Paragraph 4.2
shall be applied to adjust Base Rental as set forth above.

(b) "Index" shall be the Consumer Price Index for all Urban
Consumers published by the Bureau of Labor Statistics of the U.S. Department of
Labor, U.S. City Average All Items (1982-84=100), or any successor or substitute
index designated by Landlord, appropriately adjusted.

(c) The amounts by which the Base Rental is increased pursuant
to this Paragraph shall be deemed to thereafter be a part of "Base Rental" for
all purposes whatsoever under this Lease and a part of the rent and
consideration for this Lease and to be payable in a like manner to the initial
Amount of Base Rental specified herein.

4.3 Reimbursement for Increases in Operating Expenses.

(a) For each calendar year during the Lease Term, commencing
with the first full calendar year during the Lease Term (each such calendar year
being hereinafter in this Paragraph 4.3 referred to as an "Adjustment Year"),
Tenant shall pay to Landlord, as additional rent, an amount equal to Tenant's
Percentage Share of the total dollar increase, if any, in Operating Expenses
paid or incurred by Landlord in such Adjustment Year over the Base Operating
Expenses.

(b) During December of the year prior to the Adjustment Year,
or as soon thereafter as practicable, Landlord shall give Tenant written notice
of its estimate of any amount payable by Tenant under this Paragraph 4.3 for the
Adjustment Year. On or before the first day of each month during the Adjustment
Year, Tenant shall pay to Landlord 1/12th of such estimated amount, provided
that if such notice is not given in December Tenant shall continue to pay the
monthly installment amount, if any, which was paid or payable in December until
the month after such notice is given, in which event the estimated amount shall
be paid in equal monthly installments over the remainder of the Adjustment Year.
If at any time or times it appears to Landlord that the amount payable by Tenant
under this Paragraph 4.3 for the Adjustment Year will vary from Landlord's
estimate by more than five percent (5%), Landlord may, by notice to Tenant,
revise its estimate for such year and subsequent payments by Tenant for such
year shall be based on such revised estimate; provided, however, the Landlord
shall have no obligation to revise its estimate during an Adjustment Year.
Within ninety (90) days after the close of each Adjustment Year or as soon after
such ninety (90) day period as practicable, Landlord shall deliver to Tenant a
statement of Tenant's actual share of the increase, if any, in Operating
Expenses for such

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Adjustment Year prepared by Landlord, and such statement shall be final and
binding upon Landlord and Tenant. If on the basis of such statement Tenant owes
an amount that is less than the estimated payments for such Adjustment Year
previously made by Tenant, Landlord shall apply such excess to the amounts of
Base Rental next coming due, without interest. If upon the basis of such
statement Tenant owes an amount that is more than the estimated payments for
such Adjustment Year previously made by Tenant, Tenant shall pay the deficiency
to Landlord within thirty (30) days after delivery of the statements. In order
to achieve a fair and equitable allocation of Operating Expenses under this
Paragraph 4.3, in the event less than ninety-five percent (95%) of the Rentable
Area of the Building shall have been occupied by tenants continuously throughout
an Adjustment Year of the Lease Term, then Operating Expenses for such
Adjustment Year shall be adjusted and be deemed to be the amount of operating
Expenses which would have been incurred if ninety-five percent (95%) of the
Building were so occupied during said Adjustment Year.

(c) in the event that this Lease terminates before the end of
a calendar year, then Landlord shall deliver to Tenant, within ninety (90) days
after the close of the Adjustment Year or as soon thereafter as practicable, a
statement of Tenant's Percentage Share of the increase, if any, in the actual
Operating Expenses (as prorated for said Adjustment Year based on the
termination date of the Lease) and such statement shall be final and binding
upon Landlord and Tenant. If, on the basis of such statement, Tenant owes an
amount that is less than the estimated payments for such partial Adjustment Year
previously made by Tenant after the Expiration Date, Landlord shall within
thirty (30) days refund such excess to Tenant, without interest. If on the basis
of such statement, Tenant owes an amount that is more than the estimated
payments for such partial Adjustment Year previously made by Tenant after the
Expiration Date, Tenant shall pay the deficiency to Landlord within thirty (30)
days after delivery of such statement. The termination of this Lease shall not
affect the obligations of Landlord and Tenant pursuant to this Paragraph 4.3 to
be performed after such termination and the failure to pay any additional rents
as provided under this Paragraph 4.3 shall entitle Landlord to all remedies
provided herein and at law or in equity on account of Tenant's failure to pay
rent.

4.4 [Omitted].

4.5 Security Deposit. Landlord acknowledges that it has received from
Tenant the Security Deposit, which amount shall be security for the full and
faithful performance and observance by Tenant of its covenants and obligations
under this Lease. No interest shall be payable on the Security Deposit, and it
is agreed and acknowledged by Tenant that the Security Deposit is not an advance
payment of rent or a measure of Landlord's damages in the case of default by
Tenant. Upon the occurrence of an event of default under this Lease, Landlord
may use, apply, or retain the whole or any part of the Security Deposit to the
extent required for the payment of any Base Rental and additional rent or any
other sums to which Tenant is in default or for the payment of any other damage,
injury, expense, or liability resulting from any event of default. Following any
such application of the Security Deposit, Tenant shall pay to Landlord on demand
the amount necessary to restore the Security Deposit to its original amount. In
the event that Tenant shall fully and faithfully comply with all of its
covenants and obligations under this Lease, the Security Deposit shall be
returned to Tenant within thirty (30) days after the Expiration Date (or any
permitted extensions thereof) and after delivery of possession of the Premises
to Landlord in accordance with the terms hereof. In the event of a sale of the
Building or a lease of the Building, subject to this Lease, Landlord shall be
released from all liability for the return of the Security Deposit and Tenant
shall look to the new landlord for the return of the Security Deposit. This
provision shall apply to every transfer or assignment made of the Security
Deposit to a new landlord.

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4.6 Payments. Tenant shall pay to Landlord all Base Rent, additional
rent, and all other charges due and owing by Tenant under this Lease without
deduction or setoff, in legal tender, and at Landlord's address or as otherwise
directed from time to time by Landlord's notice.

PREPARATION, MAINTENANCE, AND REPAIR OF PREMISES

5.1 Preparation of the Premises.

(a) Landlord shall construct or install in the Premises the
Tenant Improvements, as defined in and to be constructed or installed pursuant
to the provisions of the Tenant Improvement Agreement which is attached hereto
as Exhibit "C". Tenant agrees to comply with all of the terms and provisions of
the Tenant Improvement Agreement, including, without limitation, the obligation
to pay, as additional rent, all amounts due Landlord under Section 3 thereof
according to the payment procedures contained in said section 3.

(b) Tenant shall be responsible for and shall pay from time to
time, as additional rent, any increase in ad valorem taxes against the Building
caused by any improvements to the Premises in excess of the Base Building
Condition and Landlord's Allowance for Tenant Improvement Costs.

5.2 Repairs by Tenant. Tenant shall at its own expense keep the
Premises in good repair and condition and tenantable condition and indemnify
Landlord against any loss, damage, or expense arising by reason of any failure
of Tenant to keep the Premises in good repair and tenantable condition or due to
any act or neglect of Tenant, its agents, employees, contractors, invitees,
licensees, tenants, or assignees. The maintenance and repair obligations of
Tenant hereunder shall include, not by way of limitation, but by way of
illustration, all glass windows excluding ordinary interior cleaning and
partitions, ceilings, floor and wall coverings, and electrical and plumbing
facilities. If Tenant fails to perform, or cause to be performed, such
maintenance and repairs, then at the option of Landlord, in its sole discretion,
any such maintenance or repair may be performed or caused to be performed by
Landlord and the cost and expense thereof charged to Tenant, and Tenant shall
pay the amount thereof to Landlord on demand as additional rent.

5.3 Transfer of Tenants. Landlord hereby reserves the right, at its
sole option and upon giving at least sixty (60) calendar days advance written
notice to Tenant, to transfer and remove Tenant, at any time, from the Premises
(or any other space to which Tenant was relocated pursuant to this Paragraph
5.3) to any other available space in the Building of substantially equal area.
Landlord hereby agrees to bear the expense of such transfer and removal, as well
as the expense of any renovations or alterations which are necessary to make the
new space conform substantially in appointment with the Premises. If Landlord
moves Tenant to such new space, every term and condition of this Lease shall
remain in full force and effect, except the Base Rental, which shall be adjusted
pro rata to reflect any change in the Rentable Area of the new Premises, and
such new space shall thereafter be deemed to be the Premises as though Tenant
had entered into an express written amendment of this Lease with respect
thereto. Failure of Tenant to cooperate with Landlord pursuant to this provision
and to remove itself from the Promises shall permit Landlord (i) to enter the
Premises and to remove Tenant and its property therefrom, by force if necessary,
and to relocate Tenant and its property in the new space provided by Landlord
pursuant to this provision, all without being liable to Tenant in any manner
whatsoever for such acts except for the expenses which are provided in this
Paragraph 5.3 to be paid by Landlord, or (ii) to

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cancel and terminate this Lease effective ninety (90) days from the date of
original notification by Landlord.

5.4 Repairs by Landlord. Landlord shall have no duty to Tenant to make
any repairs or improvements to the Premises except structural repairs necessary
for safety and tenantability, and then only if not brought about by an act or
neglect of Tenant, its agents, employees, contractors, invitees, licensees,
tenants or assignees.

5.5 Alterations by Tenant. Tenant shall make no alterations or
additions of any kind in or to the Premises without first obtaining Landlord's
written consent. All such work, including additions, fixtures (except those
fixtures placed by Tenant) and leasehold improvements (but excluding moveable
office furniture and equipment and other personal property of Tenant) made or
placed in or upon the Premises by either Tenant or Landlord shall be and become
the Landlord's property at the termination of this Lease by lapse of time or
otherwise, all without compensation or payment to Tenant, and shall remain upon
and in the Premises; but said property shall be and remain the Tenant's property
during the Lease Term.

5.6 Discharge of Liens. Tenant shall discharge of record by bond or
otherwise within ten (10) days following the filing thereof any mechanic's or
similar lien filed against the Premises or the Building for work or materials
claimed to have been furnished to or for the benefit of Tenant and/or the
Premises; provided, however, that Tenant shall have no responsibility with
respect to any mechanic's or similar lien filed against the Premises or the
Building for work or materials furnished by or at Landlord's request pursuant to
the Tenant Improvement Agreement, if Tenant is current in the payment of all
obligations owed Landlord under the Tenant Improvement Agreement. If Tenant
shall fail to cause such lien or claim of lien to be so discharged or bonded
within such period, in addition to any other right or remedy it may have,
Landlord may, but shall not be obligated to, discharge the same by paying the
amount claimed to be due or by procuring the discharge or such lien or claim by
deposit in court or bonding, and in any such event, Landlord shall be entitled,
if Landlord so elects, to compel the prosecution of any action for the
foreclosure of such lien or claim by the lienor or claimant and to pay the
amount of the judgment, if any, in favor of the lienor, with interest, costs and
allowances. Tenant shall pay as additional rent on demand from time to time any
sum or sums so paid by Landlord and all costs and expenses incurred by Landlord,
including but not limited to, attorneys' fees in processing such discharge or in
defending any such action.

5.7 Damage and Destruction.

(a) If the Building or Premises are rendered partially or
wholly unfit for occupancy by fire, the elements, act of God or other casualty,
and if such damage cannot, in Landlord's reasonable estimation, be materially
restored within ninety (90) days of such damage, then Landlord may, at its sole
option, terminate this Lease as of the date of such fire or casualty and the
Lease Term shall end on such date as if that date had been originally fixed in
this Lease for the expiration of the Lease Term. Landlord shall exercise its
option provided herein by written notice to Tenant within sixty (60) days of
such fire or other casualty. For purposes hereof, the Building or Premises shall
be deemed "materially restored" if they are in such condition as would not
prevent or materially interfere with Tenant's use of the Premises for the
purpose for which it was then being used.

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(b) If this Lease is not terminated pursuant to subparagraph
(a) above, then Landlord shall proceed with all due diligence to repair and
restore the Building or Premises, as the case may be (except that Landlord may
elect not to rebuild, and thus terminate this Lease, if such damage occurs
during the last two (2) years of the Lease Term (unless Tenant extends the Lease
Term for an additional two (2) year period) exclusive of any option which is
unexercised at the date of such damage). In the event that Landlord shall fail
to complete such repairs and material restoration within one hundred fifty (150)
days after Landlord notifies Tenant of its election to repair and restore the
Premises as provided in this Paragraph, Tenant may, at its option and as its
sole remedy, terminate this Lease by delivering written notice to Landlord,
whereupon this Lease shall end on the date of such fire or casualty as if the
date of such notice were the date originally fixed in this Lease for the
expiration of the term hereof; provided, however, that if construction is
delayed because of changes, deletions, or additions in construction requested by
Tenant, or because of strikes, lockouts, casualties, acts of God or intervention
of other supernatural forces, war, material or labor shortages, governmental
regulation or control, or other causes beyond the reasonable control of
Landlord, the period for restoration, repair or rebuilding shall be extended for
the amount of time Landlord is so delayed. In no event shall Landlord be
required to rebuild, repair, or replace any part of the partitions, fixtures,
additions, or other property and improvements which may have been placed in or
about the Premises by Tenant.

(c) If this Lease shall not be terminated by Landlord pursuant
to this Paragraph 5.7 and if the Premises are unfit for occupancy in whole or in
part following such damage, the rent payable during the period in which the
Premises are unfit for occupancy shall abate in proportion to the number of
square feet of Rentable Area of the Premises rendered unusable by such damage;
provided, however, that no such abatement shall be made under the provisions of
this Subparagraph (c) in the event such damage shall have been caused through
the negligence or willful misconduct of Tenant, its agents, employees,
contractors, invitees, licensees, tenants, or assignees.

(d) In the event of any damage or destruction to the Building
or the Premises, Tenant shall, upon notice from Landlord, remove forthwith, at
its sole cost and expense, such portion or all of the property belonging to
Tenant (other than partitions, fixtures, additions, and similar improvements)
from such portion or all of the Building or the Premises as Landlord shall
request, and Tenant hereby indemnifies and holds Landlord harmless from any
loss, liability, costs, and expenses, including attorneys' fees arising out of
any claim of damage or injury as a result of any alleged failure properly to
secure the Premises prior to such removal and/or such removal.

(e) Any insurance which may be carried by Landlord or Tenant
against loss or damage to the Building or Premises shall be for the sole benefit
of the party carrying such insurance and under its sole control except that
Landlord's insurance may be subject to control by the holder or holders of any
indebtedness secured by a mortgage or deed to secure debt covering any interest
of Landlord in the Premises or the Building.

(f) Notwithstanding anything herein to the contrary, in the
event the holder of any indebtedness secured by a mortgage or deed to secure
debt covering the Premises or Building requires that any insurance proceeds be
paid to it, then Landlord shall have the right to terminate this Lease by
delivering written notice of termination to Tenant within fifteen (15) days
after such requirement is made by any such person, whereupon the Lease shall end
on the date of such damage as if the date of such damage were the date
originally fixed in this Lease for the expiration of the Lease Term.

(g) If any such casualty stated in this Paragraph 5.7 is not
the result of gross negligence or willful misconduct of Landlord, Landlord shall
not be liable to Tenant for inconvenience,

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annoyance, loss of profits, expenses, or any other type of injury or damage
resulting from the repair of any such damage, or from any repair, modification,
arranging, or rearranging of any portion of the Premises or any part or all of
the Building or for termination of this Lease as provided in this Paragraph 5.7.

5.8 Eminent Domain.

(a) If all or any substantial part of the Building or Premises
should be taken for any public or quasi-public use under governmental law,
ordinance, or regulation, or by right of eminent domain, or by private purchase
in lieu thereof, and the taking would prevent or materially interfere with the
use of the Premises for the purpose for which it is then being used, this Lease
shall terminate effective when the physical taking shall occur in the same
manner as if the date of such taking were the date originally fixed in this
Lease for the expiration of the Lease Term.

(b) If part of the Building or Premises is taken for any
public or quasi-public use under any governmental law, ordinance, or regulation,
or by right of eminent domain, or by private purchase in lieu thereof, and this
Lease is not terminated as provided in Subparagraph (a) above this Lease shall
not terminate but the Base Rental payable hereunder during the unexpired portion
of this Lease shall be reduced to such extent, if any, as may be fair and
reasonable under all of the circumstances, and Landlord shall undertake to
restore the Building and Premises to a condition suitable for Tenant's use, as
near to the condition thereof immediately prior to such taking as is reasonably
feasible under all circumstances.

(c) All compensation awarded or paid upon a total or partial
taking of the Premises or the Building shall belong to and be the Property of
Landlord without participation by Tenant. Nothing herein shall be construed to
preclude Tenant from prosecuting and claim directly against the condemning
authority solely for loss of business, damage to, and cost of removal of trade
fixtures, furniture and other personal property belonging to Tenant; provided,
however, that no such claim shall diminish or adversely affect Landlord's award.

(d) Notwithstanding anything to the contrary contained in this
Paragraph 5.8, if during the Lease Term the use or occupancy of any part of the
Building or Premises shall be taken or appropriated temporarily for any public
or quasi-public use under any governmental law, ordinance, or regulation, or by
right of eminent domain, this Lease shall be and remain unaffected by such
taking or appropriation, and Tenant shall continue to pay in full all rent
payable hereunder by Tenant during the term of this Lease; in the event of any
such temporary appropriation or taking, Tenant shall be entitled to receive that
portion of any award which represents compensation for the loss of use or
occupancy of the Premises during the term of this Lease, and Landlord shall be
entitled to receive that portion of any award which represents the cost of
restoration and compensation for the loss of use or occupancy of the Premises
after the end of the term of this Lease and of the Building.

5.9 Reports of Defects. Tenant shall report to Landlord immediately, in
writing, any damage to or defective condition in or about the Building or
Premises known to Tenant.

5.10 Landlord's Right to Enter Premises. Tenant shall not change the
locks on any entrance to the Premises. Upon Tenant's written request to
Landlord, Landlord will make a reasonable change of locks on behalf of Tenant
and at Tenant's sole cost and expenses. In the event Tenant places additional
locks on the entrance doors to the Premises, Tenant shall provide to Landlord at
least one (1) copy of the key or the master combination. Tenant shall, in no
event, place an additional or replacement lock on the

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<PAGE> 13

primary entry door. Landlord and its agents, employees, and contractors shall
have the right to enter the Premises at such times as Landlord deems reasonably
necessary to make necessary repairs, additions, alterations, and improvements to
the Building, including, without limitation, the erection, use, and maintenance
of pipes and conduits and to show the Premises to prospective tenants and
purchasers of the Building with prior notice, except in the case of a bona-fide
emergency. Landlord shall also be allowed to take into and through the Premises
any and all needed materials that may be required to make such repairs,
additions, alterations, and improvements, all without being liable to Tenant in
any manner whatsoever. During such time as work is being carried on in or about
the Premises, provided such work is carried out in a manner so as not to
interfere unreasonably with the conduct of Tenant's business therein, the rent
provided herein shall in no way abate, and Tenant waives any claim and cause of
action against Landlord for damages by reason of loss or interruption to
tenant's business and profits therefrom because of the prosecution of any such
work or any part thereof. In the event of emergency, or if otherwise necessary
to prevent injury to persons or damage to property, such entry to the Premises
may be made by force without any liability whatsoever on the part of Landlord
for damage resulting from such forcible entry.

VI.

USE AND SERVICES

6.1 Use. Tenant shall use the Premises for general office purposes and
no other purpose. Tenant shall not use the Premises for any illegal purpose, nor
violate any statute, regulation, rule, or order of any governmental body in its
use thereof, nor create or allow to exist any nuisances or trespasses, nor do
any act in or about the Premises or bring anything except computers onto or into
the Premises which will in any way increase the rate of insurance on the
Premises, nor deface or injure the Premises or overload the floor of the
Premises.

6.2 Services. Provided Tenant shall not be in default under this Lease,
Landlord agrees to provide to Tenant, as Landlord deems reasonably necessary,
the following services:

(a) General cleaning and janitorial service required as a
result of normal, prudent use of the Premises and only on Mondays through
Fridays, inclusive, with New Year's Day, Memorial Day, Independence Day, Labor
Day, Thanksgiving Day, Christmas Day, and any other recognized bank holiday
(herein collectively called the "Holidays") excepted;

(b) Heating and air-conditioning service daily on Mondays
through Fridays, inclusive, with Holidays excepted, from 8:00 a.m. to 6:00 p.m.
and on Saturdays, if not a Holiday, from 8:00 a.m. to 1:00 p.m. Landlord
reserves the right to prohibit the use of heat generating machines and equipment
unless and until arrangements are made by Tenant, acceptable to Landlord, to
obtain and install in the Premises, at Tenant's cost, supplementary
air-conditioning equipment, and the cost of operating and maintenance of such
equipment shall be paid by Tenant on the Base Rental payment dates at such rates
as are established from time to time by Landlord. Should Tenant desire either
heating or air conditioning at times when such services are not furnished by
Landlord under the terms of this Lease, Landlord may elect, entirely at its
option, to furnish such services as requested by Tenant upon not less than
forty-eight (48) hours notice from Tenant, at Tenant's expense and at such
hourly charge as is commensurate with any additional expense to Landlord, which
charges Tenant shall promptly pay on being billed by Landlord. Payments for such
additional services shall be deemed additional rent due from Tenant;

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<PAGE> 14

(c) Elevator service daily on Mondays through Fridays,
inclusive, with Holidays excepted, from 8:00 a.m. to 6:00 p.m., and on
Saturdays, if not a Holiday, from 8:00 a.m. to 1:00 p.m. At least one elevator
shall be operative at all other hours;

(d) Electric current for lighting and reasonable facilities
for furnishing usual and normal electric power for office space. Tenant shall
not, without Landlord's prior written consent, use any equipment, including,
without limitation, electronic data processing machines, punch card machines,
duplicating machines, computers or any other machines which use electric current
in excess of 110 volts 20 amperes, or which will increase the amount of
electricity ordinarily furnished for the use of the Premises in accordance with
the standards for the Building as general office space or which requires
"dedicated" circuits or other special distribution circuits. If Tenant requires
such additional electric power or such special circuits and such power of
circuits are furnished by Landlord, Tenant shall pay, on demand, the cost of
installation and maintenance of the facilities required to provide such
additional electrical power or circuits and the cost of all such electric
current consumed plus any expense of Landlord in keeping accounts of such
electric current consumed, including the cost of installation of additional
meters. Payments for such additional electrical power shall be deemed additional
rent due from Tenant.

6.3 Telephone Service.

(a) Tenant acknowledges and agrees that securing and arranging
for telephone service to the Premises is the sole responsibility of Tenant and
that Landlord has no responsibility or obligation to provide or arrange such
telephone service, nor to permit installation of any facilities or equipment in
the Building outside the Premises except in normal or standard locations the
Building for such equipment, in connection with providing telephone service to
the Premises.

(b) Tenant acknowledges and agrees that Landlord has entered
into a "Management and Operation Agreement" (the "Fairchild Agreement") with
Fairchild Communication Services, Inc. ("Fairchild"), whereby Fairchild agrees
to provide a branch exchange, and associated common equipment and software for
the Building, which, at the option of the Tenant, may be utilized by Tenant
pursuant to separate agreement(s) between Fairchild and Tenant. Tenant
acknowledges and agrees that Landlord is in no way responsible for or liable for
the acts or omissions of Fairchild under or in connection with either the
Fairchild Agreement, any agreement(s) between Tenant and Fairchild, or
otherwise. Tenant acknowledges and agrees that any cessation or interruption of
services or breach of the Fairchild Agreement or of any agreement between
Fairchild and Tenant, or both, shall not constitute a default by Landlord under
this Lease nor a constructive eviction by Landlord, and Tenant shall not be
entitled to any abatement or reduction of payments due under this Lease to
Landlord by reason of any of such occurrences or for any other claim arising out
of or in connection with the Fairchild Agreement, the agreement(s) between
Tenant and Fairchild, or any acts or omissions of Fairchild. Tenant agrees that
it shall not be deemed a party nor a beneficiary of the Fairchild Agreement
between Landlord and Fairchild and accordingly, Landlord shall have the right,
at its option, to modify or terminate said Agreement. Any exercise by Landlord
of remedies against Fairchild for Fairchild's default under the Fairchild
Agreement shall be solely at Landlord's option and exercised only on behalf of
Landlord.

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<PAGE> 15

VII.

COMPLIANCE WITH LAWS

7.1 Compliance with Laws. Tenant shall comply, at its own expense, with
all statutes, regulations, ordinances, and orders of any governmental body,
department or agency thereof which apply to or result from Tenant's use or
occupancy of the Premises and shall abide by and observe the Rules and
Regulations attached to this Lease as Exhibit "D" and also such other rules and
regulations for the use, occupancy, or operation of the Building as may
hereafter be established in writing by Landlord.

7.2 Rent Control. Tenant waives the benefit of all existing and future
rent control laws and similar governmental rules and regulations, whether in
time of war or not, to the full extent permitted by law.

7.3 Building Alterations. If, in order to maintain the Building as an
office building or otherwise, Landlord shall be required by any governmental
authority to repair, alter, remove, construct, reconstruct, or improve any part
or all of the Building or Premises, Tenant's obligations under this Lease will
not be affected and Tenant waives all claims for injury, damage or abatement of
rent because of such repair, alterations, removal, construction, reconstruction,
or improvement, or lack thereof; provided, however, that if such election by
Landlord shall render the Premises partially or wholly unfit for occupancy and
if, in Landlord's reasonable estimation, it cannot complete such acts within
ninety (90) days, then at the option of the Landlord to be exercised by giving
written notice to Tenant within sixty (60) days following the date of notice to
Landlord by such governmental authority, this Lease shall terminate on the date
of such election and Tenant shall immediately surrender the Premises to
Landlord. In such event, Tenant shall continue to owe and pay rent and other
charges up to but not beyond the time of such surrender. If Landlord shall elect
not to terminate this Lease as provided above, Landlord and Tenant shall have
the same respective rights and obligations as provided above in Paragraph 5.7(b)
and (c), and the provisions of Paragraph 5.7(g) shall apply regardless of
whether or not Landlord elects to terminate this Lease. Landlord reserves the
right at all times and from time to time during the Lease Term to redesign,
reconstruct and rearrange the appearance and location of all common areas,
passage ways, lobbies, entrances and access ways of and to the Building.

VIII.

INSURANCE, LIABILITY AND INDEMNIFICATION

8.1 Insurance.

(a) Tenant shall carry fire and extended coverage insurance
insuring Tenant's interest in its improvements and betterments to the Premises
and any and all furniture, equipment, supplies, and other property owned,
leased, held, or possessed by it and contained therein, such insurance coverage
to be in amount equal to the full replacement cost of such improvements and
property.

(b) Tenant also agrees to carry a policy or policies of
workers' compensation coverage in statutory limits with employer's liability of
not less than Five Hundred Thousand and No/100 Dollars ($500,000.00) and
comprehensive general liability insurance, including personal injury and
property damage, with contractual liability endorsement, in the amount of One
Million and No/100 Dollars ($1,000,000.00) combined sing1e limit per occurrence
for property damage, bodily injury or personal injuries or deaths of persons
occurring in or about the Premises. Said policies shall (i) name

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<PAGE> 16

Landlord as an additional insured and insure Landlord's contingent liability
under this Lease (except for the workers' compensation policy, which shall
instead include waiver of subrogation endorsement in favor of Landlord); (ii) be
issued by a reputable insurance company and licensed to do business in the State
of Georgia; and (iii) provide that said insurance shall not be cancelled unless
thirty (30) days' prior written notice shall have been given to Landlord. Said
policy or policies, or certificate thereof, shall be delivered to Landlord by
Tenant upon commencement of the term of the Lease and upon each renewal and/or
modification of said insurance.

(c) Tenant shall reimburse Landlord within ten (10) days after
demand for the costs incurred by Landlord for additional insurance premiums as
to the Building containing the Leased Premises which is caused by the nature of
Tenant's use or occupancy of the Leased Premises or its manner of use or
occupancy of the Leased Premises or both.

8.2 Waiver of Subrogation. Landlord and Tenant each hereby releases the
other from any and all liability or responsibility to the other or anyone
claiming through or under them by way of subrogation or otherwise for any loss
or damage to property caused by fire or any other perils insured in policies of
insurance covering such property, even if such loss or damage shall have been
caused by the fault or negligence of the other party, or anyone for whom such
party may be responsible, including, without limitation, any other tenants or
occupants of the remainder of the Building; provided, however, that this release
shall be applicable and in force and effect only to the extent that such release
shall be lawful at that time and in any event only with respect to loss or
damage occurring during such time as the releasor's policies shall contain a
clause or endorsement to the effect that any such release shall not adversely
affect or impair said policies or prejudice the right of the releasor to recover
thereunder and then only to the extent of the insurance proceeds payable under
such policies. Landlord and Tenant each agrees that it will request its
insurance carriers to include in its policies such a clause of endorsement. If
extra cost shall be charged therefor, each party shall advise the other thereof
and of the amount of the extra cost, and the other party, at its election, may
pay the same, but shall not be obligated to do so. If such other party fails to
pay such extra costs, the release provisions of this Paragraph shall be
inoperative against such other party to the extent necessary to avoid
invalidation of such releasor's insurance.

8.3 Indemnity. Tenant indemnifies and shall hold Landlord harmless from
and defend Landlord against any and all claims or liability for any injury or
death to any person or damage to any property whatsoever:

(a) either (i) occurring in, on, or about the Premises, or
(ii) occurring in, on, or about any facilities (including, without limitation,
elevators, stairways, passageways or hallways) the use of which Tenant may have
in conjunction with other tenants of the Building, when such injury, death or
damage shall be caused in part or in whole by the act, neglect or fault of, or
omission of any duty with respect to the same by Tenant, its agents, employees,
contractors, invitees, licensees, tenants, or assignees;

(b) arising from any work or thing whatsoever done by or
benefiting the Tenant in or about the Premises or from transactions of the
Tenant concerning the Premises;

(c) arising from any breach or default on the part of the
Tenant in the performance of any covenant or agreement on the part of the Tenant
to be performed pursuant to the terms of this Lease; or

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<PAGE> 17

(d) otherwise arising from any act or neglect of the Tenant,
or any of its agents, employees, contractors, invitees, licensees, tenants or
assignees; and

from and against all costs, expenses, counsel fees, and court costs incurred or
assessed in connection with any or all of the foregoing. Furthermore, in case
any action or proceeding be brought against Landlord by reason of any claims or
liability Tenant agrees to cause such action or proceeding to be defended at
Tenant's sole expense by counsel reasonably satisfactory to Landlord. The
provisions of this Lease with respect to any claims or liability occurring or
caused prior to any expiration or termination of this Lease shall survive such
expiration or termination.

8.4 Liability of Landlord. Excepting for the proven gross negligence of
Landlord, its successors, agents, employees and contractors acting within the
scope of their engagement by Landlord, Landlord shall not be liable to Tenant or
to any persons, firm, corporation, or other business association claiming by,
through, or under Tenant for failure to furnish or for delay in furnishing any
service provided for in this Lease, and no such failure or delay by Landlord
shall be an actual or constructive eviction of Tenant nor shall any such failure
or delay operate to relieve Tenant from the prompt and punctual performance of
each and all the covenants to be performed herein by Tenant; nor for any latent
defects in the Premises or Building; nor for defects in the cooling, heating,
electric, water, elevator, or other apparatus or systems or for water discharged
from sprinkler systems, if any, or from water pipes and plumbing facilities in
the Building; nor for the theft, mysterious disappearance, or loss of any
property of Tenant whether from the Premises or any part of the Building; and
nor from interference, disturbance, or acts to or omitted against Tenant by
third parties, including, without limitation other tenants of the Building and
any such occurrences shall not constitute an actual or constructive eviction of
Tenant.

8.5 Limitation of Liability. Landlord's obligations and liability with
respect to this Lease shall be limited solely to Landlord's interest in the
Building, as such interest is constituted from time to time, and neither
Landlord nor any officer, director, shareholder, or partner of Landlord, or of
any partner of Landlord, shall have any personal liability whatsoever with
respect to this Lease.

IX.

DEFAULT AND RELATED REQUIREMENTS

9.1 Default and Remedies.

(a) The occurrence of any of the following shall constitute
"events of default":

(i) The Base Rental (including any additional rent)
or any other sum of money payable under this Lease, or both, is not paid when
due;

(ii) The Premises are deserted, vacated, or not used
as would normally be expected for similar premises put to general office use,
even though the Tenant continues to pay the stipulated monthly Base Rental;

(iii) Tenant's interest in the Lease or the Premises
shall be subjected to any attachment, levy, or sale pursuant to any order or
decree entered against Tenant in any legal proceeding and such order or decree
shall not be vacated within fifteen (15) days of entry thereof; or

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<PAGE> 18

(iv) Tenant breaches or fails to comply with any
term, provision, condition, or covenant of this Lease, other than the payment of
Base Rental and other charges, or with any of the Rules and Regulations now or
future reasonable Rules and Regulations established from time to time by
Landlord to govern the operation of the Building.

(b) Upon the occurrence of an event of default, Landlord shall
have the option to do and perform any one or more of the following in addition
to, and not in limitation of, any other remedy or right permitted it by law or
in equity or by this Lease:

(i) Landlord, with or without terminating this Lease,
may immediately or at any time thereafter reenter the Premises and correct or
repair any condition which shall constitute a failure on Tenant's part to keep,
observe, perform, satisfy, or abide by any term, condition, covenant, agreement,
or obligation of this Lease or of the Rules and Regulations now in effect or
future reasonable Rules or Regulations adopted or of any notice given Tenant by
Landlord pursuant to the terms of this Lease, and Tenant shall fully reimburse
and compensate Landlord on demand;

(ii) Landlord, with or without terminating this
Lease, may immediately or at any time thereafter demand in writing that Tenant
vacate the Premises and thereupon Tenant shall vacate the Premises and remove
therefrom all property thereon belonging to or placed on the Premises by, at the
direction of, or with consent of Tenant within ten (10) days of receipt by
Tenant of such notice from Landlord, whereupon Landlord shall have the right to
reenter and take possession of the Premises. Any such demand, reentry and taking
possession of the Premises by Landlord shall not of itself constitute an
acceptance by Landlord of a surrender of this Lease or of the Premises by Tenant
and shall not of itself constitute a termination of this Lease by Landlord;

(iii) Landlord, with or without terminating this
Lease, may immediately or at any time thereafter reenter the Premises and remove
therefrom Tenant and all property belonging to or placed on the Premises by, at
the direction of, or with consent of Tenant. Any such reentry and removal by
Landlord shall not of itself constitute an acceptance by Landlord of a surrender
of this Lease or of the Premises by Tenant and shall not of itself constitute a
termination of this Lease by Landlord;

(iv) Landlord, with or without terminating this
Lease, may immediately or at any time thereafter relet the Premises or any part
thereof for such time or times, at such rental or rentals and upon such other
terms and conditions as Landlord in its sole discretion may deem advisable, and
Landlord may make any alterations or repairs to the Premises which it may
reasonably deem necessary or proper to facilitate such reletting; and Tenant
shall pay all reasonable costs of such reletting, including, but not limited to,
the cost of any such alterations and repairs to the Premises, attorneys' fees,
and brokerage commissions; and if this Lease shall not have been terminated,
Tenant shall continue to pay all rent and all other charges due under this Lease
up to and including the date of beginning of payment of rent by any subsequent
tenant of part or all of the Premises, and thereafter, Tenant shall pay monthly
during the remainder of the term of this Lease the difference, if any, between
the rent and other charges collected from any such subsequent tenant or tenants
and the rent and other charges reserved in this Lease, but Tenant shall not be
entitled to receive any excess of any such rents collected over the rents
reserved herein;

(v) Landlord may immediately or at any time
thereafter terminate this Lease, and this Lease shall be deemed to have been
terminated upon receipt by Tenant of written notice of such termination; upon
such termination Landlord shall recover from Tenant all damages Landlord may
suffer by reason of such termination, including, without limitation, unamortized
sums expended by

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Landlord for construction of Tenant Improvements, all arrearages in rentals,
costs, charges, additional rentals, and reimbursements, the cost (including
court costs and attorneys' fees) of recovering possession of the Premises, the
cost of any alteration of or repair to the Premises which is necessary or proper
to prepare the same for reletting and, in addition thereto, Landlord at its
election shall have and recover from Tenant either (1) an amount equal to the
excess, if any, of the total amount of all rents and other charges to be paid by
Tenant for the remainder of the term of this Lease over the then reasonable
rental value of the Premises for the remainder of the term of this Lease, or (2)
the rents and other charges which Landlord would be entitled to receive from
Tenant pursuant to the provisions of clause (iv) of this Subparagraph (b) above
if the Lease were not terminated. Such election shall be made by Landlord by
serving written notice upon Tenant of its choice of one of the two said
alternatives within thirty (30) days of the notice of termination.

(c) If Landlord reenters the Premises or terminates this Lease
pursuant to any of the provisions of this Lease, Tenant hereby waives all claims
for damages which may be caused by such reentry or termination by Landlord.
Tenant shall and does hereby indemnify and hold Landlord harmless from any loss,
costs (including court costs and attorneys' fees), or damages suffered by
Landlord by reason of such reentry or termination. No such reentry or
termination shall be considered or construed to be a forcible entry.

(d) No course of dealing between Landlord and Tenant or any
failure or delay on the part of Landlord in exercising any rights of Landlord
under this Paragraph 9.1 or under any other provisions of this Lease shall
operate as a waiver of any rights of Landlord hereunder or under any other
provisions of this Lease, nor shall any waiver of a default on one occasion
operate as a waiver of any subsequent default or of any other default. No
express waiver shall affect any condition, covenant, rule, or regulation other
than the one specific in such waiver and that one only for the time and in the
manner specifically stated.

(e) The exercise by Landlord of any one or more of the rights
and remedies provided in this Lease shall not prevent the subsequent exercise by
Landlord of any one or more of the other rights and remedies herein provided
unless precluded by operation of law. All remedies provided for in this Lease
are cumulative and may, at the election of Landlord be exercised alternatively,
successively, or in any other manner and are in addition to any other rights
provided for or allowed by law or in equity.

9.2 Insolvency or Bankruptcy. The appointment of a receiver to take
possession of all or substantially all of the assets of Tenant, or an assignment
of Tenant for the benefit of creditors, or any action taken or suffered by
Tenant under any insolvency, bankruptcy, or reorganization act, shall, at
Landlord's option, constitute a breach of this Lease by Tenant. Upon the
happening of any such event or at any time thereafter, this Lease shall
terminate five (5) days after written notice of termination from Landlord to
Tenant. In no event shall this Lease be assigned or assignable by operation of
law or by voluntary or involuntary bankruptcy proceedings or otherwise, and in
no event shall this Lease or any rights or privileges hereunder be an asset of
Tenant under any bankruptcy, insolvency, or reorganization proceedings.

9.3 Late Payments. Tenant shall pay, as a late charge in the event any
installment of Base Rental, additional rent, or other charge to be paid by
Tenant hereunder is not paid when due, the greater of One Hundred and No/100
($100.00) Dollars or an amount equal to five percent (5%) of the amount due for
each and every thirty (30)-day period that said amount remains unpaid (but in no
event shall the amount of such late charge exceed an amount based upon the
highest legally permissible rate chargeable

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<PAGE> 20

at any time by Landlord under the circumstances). Should Tenant make a partial
payment of past due amounts, the amount of such partial payment shall be applied
first to reduce all accrued and unpaid late charges in inverse order of their
maturity, and then to reduce all other past due amounts in inverse order of
their maturity.

9.4 Attorneys' Fees. If any rent or other debt owing by Tenant to
Landlord hereunder is collected by or through an attorney-at-law Tenant agrees
to pay an additional amount equal to fifteen (15%) percent of the amount owing
under this Lease as attorneys' fees.

9.5 Waiver of Homestead. Tenant hereby waives and renounces all
homestead or exemption rights which Tenant may have under or by virtue of the
Constitutions and Laws of the United States, the State of Georgia, and any other
state as against any debt or sum Tenant may owe Landlord under this Lease and
hereby transfers, conveys, and assigns to Landlord all homestead or exemption
rights which may be set apart in any bankruptcy proceeding, to pay any debt or
sum owing by Tenant to Landlord hereunder.

9.6 No Waiver of Rights. No failure or delay of Landlord to exercise
any right or power given it herein or to insist upon strict compliance by Tenant
of any obligation imposed on it herein and no custom or practice of either party
hereto at variance with any term hereof shall constitute a waiver or a
modification of the terms hereof by Landlord or any right it has herein to
demand strict compliance with the terms hereof by Tenant. No person has or shall
have any authority to waive any provision of this Lease unless such waiver is
expressly made in writing and signed by an authorized officer of Landlord.

MISCELLANEOUS PROVISIONS

10.1 Broker. Tenant represents and warrants to Landlord that (except
with respect to any broker identified for Landlord by Tenant in writing prior to
Landlord's execution of this Lease) no broker, agent, commissioned salesman, or
other person has represented Tenant in the negotiations for and procurement of
this Lease and of the Premises and that no commissions, fees, or compensation of
any kind are due and payable in connection herewith to any broker, agent,
commissioned salesman, or other person. With respect to the broker(s) or other
person(s) or firm(s) excluded above from Tenant's representation and warranty of
no broker, Landlord agrees to pay to such broker all commissions, fees, or
compensation of any kind which are due and payable to such broker. Tenant agrees
to indemnify and hold Landlord harmless from any and all claims, suits, or
judgments (including, without limitation, reasonable attorneys' fees and court
costs incurred in connection with any such claims, suits, or judgments) for any
fees, commissions or compensation or any kind which arise out of or are in any
way connected with any claimed agency relationship with Tenant.

10.2 Addresses and Notices.

(a) Except for legal process which may also be served as by
law provided or as provided below, all notices required or desired to be given
with respect to this Lease shall be in writing and shall be deemed to be given
to and received by the party intended to receive such notice when hand delivered
or three (3) days after such notices shall have been deposited, postage prepaid,
to the United States mail, certified, return receipt requested, properly
addressed to the addresses specified for Landlord

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and Tenant in Paragraph 1.8 hereof. In the event of a change of address by
either party, such party shall give written notice thereof in accordance with
the foregoing.

(b) To the extent permitted by law, Tenant hereby: (i)
appoints and designates the Premises as a proper place for service of process
upon Tenant, and agrees that service of process upon any person apparently
employed by Tenant upon the Premises or leaving process in a conspicuous place
within the Premises shall constitute personal service of such process upon
Tenant (provided, however, Landlord does not hereby waive the right to serve
Tenant with process by any other lawful means).

10.3 Entire Agreement and Exhibits. This Lease constitutes and contains
the sole and entire agreement of Landlord and Tenant and no prior or
contemporaneous oral or written representation or agreement between the parties
and affecting the Premises shall have legal effect. The content of each and
every exhibit which is referenced in this Lease as being attached hereto is
incorporated into this Lease as fully as if set forth in the body of this
Lease. Landlord hereby disclaims any warranties and representations as to the
Building or Premises, whether express or implied.

10.4 Subordination and Attornment.

(a) Except as provided in subparagraph (c) below with respect
to mortgage subordination, this Lease and all rights of Tenant hereunder are and
shall be subject and subordinate to the lien of any first mortgage, deed to
secure debt, deed of trust, or other instrument in the nature thereof which may
now or hereafter affect Landlord's interest in the Premises and to any other
instrument encumbering the Landlord's interest in the Premises and to any
modifications, renewals, consolidations, extensions, or replacements thereof.

(b) Subparagraph (a) above shall be self-operative, and no
further instrument of subordination shall be required by the holder of any such
instrument. In confirmation of such subordination, Tenant shall, upon demand, at
any time or times, execute, acknowledge, and deliver to Landlord or the holder
of any such mortgage, deed to secure debt, deed of trust, or other such
instrument, without expense, any and all instruments that may be requested by
such holder to evidence the subordination of this Lease and all rights hereunder
to the lien of any such mortgage, deed to secure debt, deed of trust, or other
instrument, and each such renewals, modification, consolidation, replacement,
and extension thereof, and if Tenant shall fail at any time, within ten (10)
days following the giving of written request therefor, to execute, acknowledge,
and deliver any such instrument, Landlord or such holder, in addition to any
other remedies available to it in consequence thereof, may execute, acknowledge,
and deliver the same as the attorney-in-fact of Tenant and in Tenant's name,
place, and stead, and Tenant hereby irrevocably makes, constitutes, and appoints
Landlord or such holder, and their respective successors and assigns, such
attorney-in-fact for that purpose.

(c) Tenant shall, upon demand, at any time or times, execute,
acknowledge, and deliver to Landlord or to the holder of any mortgage, deed to
secure debt, deed of trust, or other instrument affecting or encumbering the
Landlord's interest in the Premises, without expense, any and all instruments
that may be necessary to make this Lease superior to the lien of any such
mortgage, deed to secure debt, deed of trust or other instrument, and each
renewal, modification, consolidation, replacement, and extension thereof, and if
Tenant shall fail at any time, within ten (10) days following the giving of a
written request therefor, to execute, acknowledge, and deliver any such
instrument, Landlord or such holder, in addition to any other remedies available
to it in consequence thereof, may

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<PAGE> 22
execute, acknowledge, and deliver the same as the attorney-in-fact of Tenant and
in Tenant's name, place, and stead, and Tenant hereby irrevocably makes,
constitutes, and appoints Landlord or such holder, and their respective
successors and assigns, such attorney-in-fact for that purpose.

(d) If the holder of any mortgage, deed to secure debt, deed
of trust or other instrument affecting or encumbering Landlord's interest in the
Premises, shall hereafter succeed to the rights of Landlord under this Lease,
whether through possession or foreclosure action or delivery of a new lease,
Tenant shall, at the option of such holder, attorn to and recognize such
successor as Tenant's landlord under this Lease and shall promptly execute and
deliver any instrument that may be necessary to evidence such attornment, and
Tenant hereby irrevocably appoints Landlord or such holder the attorney-in-fact
of Tenant to execute and deliver such instrument on behalf of Tenant should
Tenant refuse and fail to do so within ten (10) days after Landlord or such
holder shall have given notice to Tenant requesting the execution and delivery
of such instrument. Upon such attornment, this Lease shall continue in full
force and effect as a direct lease between such successor landlord and Tenant,
subject to all of the terms, covenants, and conditions of this Lease.

10.5 Estoppel Certificate. At any time and from time to time, Tenant,
on or before the date specified in a request therefor made by Landlord, which
date shall not be earlier than ten (10) days from the making of such request,
shall execute, acknowledge, and deliver to Landlord a certificate evidencing
whether or not (i) this Lease is in full force and effect, (ii) this Lease has
been amended in any way, (iii) there are any existing defaults on the part of
Landlord hereunder to the knowledge of Tenant and specifying the nature of such
defaults, if any, and (iv) the date to which rent, and other amounts due
hereunder, if any, have been paid. Each certificate delivered pursuant to this
Paragraph may be relied on by any prospective purchaser or transferee of
Landlord's interest hereunder or of any part of Landlord's property or by any
mortgagee of Landlord's interest hereunder or of any part of Landlord's property
or by an assignee of any such mortgage.

10.6 Severability. If any clause or provision of this Lease is or
becomes illegal, invalid, or unenforceable because of present or future laws or
any rule or regulation of any governmental body or entity, effective during its
term, the intention of the parties hereto is that the remaining parts of this
Lease shall not be affected thereby, unless such invalidity is, in the sole
reasonable determination of Landlord, essential to the rights of both parties in
which event Landlord has the right to terminate this Lease on written notice to
Tenant.

10.7 Captions. The captions used in this Lease are for convenience only
and do not in any way limit or amplify the terms and provisions hereof.

10.8 Successors and Assigns. The words "Landlord" and "Tenant" as used
herein shall include the respective contracting party, whether singular or
plural, and whether an individual, masculine or feminine, or a partnership,
joint venture, business trust, or corporation. The provisions of this Lease
shall inure to the benefit of and be binding upon Landlord and Tenant, and their
respective successors, heirs, legal representatives, and assigns, subject,
however, in the case of Tenant to the provisions of Paragraph 3.1 hereof. It is
understood and agreed that the term "Landlord", as used in this Lease means only
the owner(s), or the lessee(s), from time to time of the Building and/or the
land underlying the Building so that in the event of any sale or sales of the
Building and/or the land underlying the Building, or of any lease thereof, the
Landlord named herein shall be and hereby is entirely freed and relieved of all
covenants and obligations of Landlord hereunder accruing thereafter to the
extent of such sale or lease, and it shall be deemed without further agreement
that the purchaser, or the lessee, as the case may be, has assumed and agreed,
to the same extent, to carry out any and all covenants and obligations of

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<PAGE> 23

Landlord hereunder during the period such party has possession of all or such
portion of the Building and/or the land underlying the Building which it has
purchased or leased. Should all of the land underlying the Building and the
entire Building be severed as to ownership by sale and/or lease, then, unless
the Tenant is otherwise notified to the contrary in writing, either the owner of
the entire Building or the lessee of the entire Building, as the case may be,
that has the right to lease space in the Building to tenants shall be deemed the
"Landlord". Tenant shall be bound to any succeeding landlord for all the terms,
covenants, and conditions hereof and shall execute any attornment agreement not
in conflict herewith at the request of any succeeding landlord.

10.9 Applicable Law. The laws of the State of Georgia shall govern the
interpretation, validity, performance, and enforcement of this Lease.

10.10 Time is of the Essence. Time if of the essence of this Lease;
provided, however, that failure of Landlord to provide Tenant with any
notification regarding adjustments to Base Rental or any other charges provided
for hereunder, within the time periods prescribed in this Lease shall not
relieve Tenant of its obligation to make such contributions. Unless specifically
provided otherwise, all references to terms of days or months shall be construed
as references to calendar days or months, respectively.

10.11 Execution. This Lease may be executed in any number of
counterparts, each of which shall be deemed an original and any of which shall
be deemed to be complete in itself and may be introduced into evidence or used
for any purpose without the production of the other counterparts. No
modification or amendment of this Lease shall be binding upon the parties unless
such modification or amendment is in writing and signed by Landlord and Tenant.

10.12 Force Majeure. Landlord shall be excused for the period of any
delay and shall not be deemed in default with respect to the performance of any
of the terms, covenants, and conditions of this Lease when prevented from so
doing by a cause or causes beyond the Landlord's control, which shall include,
without limitation, all labor disputes, governmental regulations or controls,
fire or other casualty, inability to obtain any material or services, acts of
God or other supernatural forces, or any other cause not within the reasonable
control of the Landlord.

10.13 Multiple Tenants. If more than one individual or entity comprises
and constitutes Tenant, then all individuals and entities comprising Tenant are
and shall each be jointly and severally liable for the due and proper
performance of Tenant's duties and obligations arising under or in connection
with this Lease.

10.14 Authorized Signatory. If Tenant signs as a corporation, each of
the persons (of which there must be at least two) executing this Lease on behalf
of Tenant does hereby covenant and warrant that Tenant is a duly authorized and
existing corporation, that Tenant has and is qualified to do business in
Georgia, that the corporation has full right and authority to enter into this
Lease, that each and both of the persons executing this Lease on behalf of the
corporation are authorized to do so, and that such execution is fully binding on
the corporation. If Tenant signs as a partnership, joint venture, or sole
proprietorship (each being herein called "Entity") each of the persons executing
on behalf of Tenant does hereby covenant and warrant that Tenant is a duly
authorized and existing Entity, that Tenant has full right and authority to
enter into this Lease, that all persons executing this Lease on behalf of the
Entity are authorized to do so, and that such execution is fully binding on the
Entity and its partners, joint venturers, or principal, as the case may be.

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<PAGE> 24

10.15 No Recordation of Lease. This Lease is not in recordable form,
and Tenant agrees not to record or permit the recording of this Lease.

10.16 Special Stipulations. The Special Stipulations, if any, attached
hereto and initialed and dated by Landlord and Tenant are hereby incorporated
herein and made a part hereof and in the event they conflict with any of the
foregoing provisions, the Special Stipulations shall control.

10.17 Acknowledgment. By execution of this Lease, Tenant agrees to
accept, honor, and be bound by all the terms, conditions, and agreements
contained herein.

10.18 Submission of Lease. The submission of this Lease for examination
does not constitute an offer to lease nor a reservation of space even if said
Lease is executed by Landlord, and this Lease shall be effective only upon
execution hereof by Landlord and Tenant and delivery of a counterpart hereof to
Landlord and Landlord's acceptance and final approval thereof.

-24-
<PAGE> 25

IN WITNESS WHEREOF, the parties hereto have duly executed this
instrument in duplicate, individually, or through their respective authorized
officers, agents, or attorneys-in-fact, as the case may be, causing their
respective seals to be affixed hereto, the day and year set forth to the left of
their respective executions, the latest of which is and shall be deemed to be
the date of this Lease.

"TENANT"

E3 Associates Ltd.

By: /s/ Anders H. Herlitz
-----------------------------------------

Title: Chairman
--------------------------------------

Attest: /s/ Daniel J. Craddock
-------------------------------------

Title: Vice President, Customer Relations
--------------------------------------

"LANDLORD"

Two Park, Inc.

By: LaSalle Partners Asset
Management Limited, Its
authorized agent

By: /s/ Bret E. Bunnett
-----------------------------------------

Title: Vice President
--------------------------------------

Date: 11/8/90
---------------------------------------

(Note: Under the Delaware Revised Uniform Limited Partnership Act, a
limited partnership may have officers and may, by and through those
officers, execute documents, including leases.)

*Note - If Tenant is a corporation, lease must be signed by an
authorized officer of the corporation and attested by a secretary or
assistant secretary of the corporation who must also affix, the
corporate seal.

-25-
<PAGE> 26

SPECIAL STIPULATIONS
TO LEASE
DATED ___________, 19____
BY AND BETWEEN
E3 ASSOCIATES, INC.
AS TENANT AND
TWO PARK, INC.
AS LANDLORD

S.S.1 FREE RENT INCENTIVE

Tenant shall receive a credit (the "Free Rent Incentive") against Base
Rental otherwise payable hereunder for the first twelve (12) months of
the Term of this Lease (the "Free Rent Period") in the amount of the
Base Rental which would otherwise be payable hereunder during such
period, and the Free Rent Incentive shall accrue on a monthly basis
during the Free Rent Period; provided, however, that if an event of
default under this Lease occurs within the Free Rent Period and remains
uncured after the expiration of any period provided hereunder for cure
thereof, the Free Rent Incentive shall cease to accrue upon notice of
Landlord to Tenant. In the event at any time this Lease is terminated
due to Tenant's default in accordance with the terms of this Lease,
Landlord, in addition to all other remedies provided in this Lease and
at law, shall be entitled to recover from Tenant the unamortized value
of the Free Rent Incentive, and Tenant shall pay same to Landlord
immediately upon demand.

S.S.2 BASE RENTAL

For purposes of Paragraphs 1.1 and 4.1 of the Lease, during the initial
twelve (12) months of the Lease Term, there shall be no Base Rental due
as specified in Paragraph S.S.1 herein, and thereafter Base Rental
shall be computed by multiplying the then Rentable Area of the Premises
times a dollar per square foot rate as follows: During the thirteenth
(13th) through the thirty-sixth (36th) month, inclusive of the Lease
Term, the square foot rate per rentable square foot of the Premises
shall be $17.00 per rentable square foot per year; during the
thirty-seventh (37th) through the sixtieth (60th) month inclusive of
the Lease Term, the square foot rate per rentable square foot of the
Premises shall be $22.00 per rentable square foot per year.

S.S.3 LEASE TERMINATION

Landlord and Tenant agree that the term of that certain lease entered
into between Landlord and Tenant dated October 24, 1986, as amended
(the "Old Lease"), with respect to certain space in known as Suite 110,
One Parkway Center, 1850 Parkway Place, Marietta, Georgia, shall cease
and terminate on the Commencement Date of this Lease, as if such date
were the date originally provided in the Old Lease for expiration of
the term thereof. All renewal and expansion rights of Tenant provided
for in the Old Lease shall be void and of no further effect as of the
date of this Lease.

S.S.4 MANDATORY-EXPANSION SPACE

A. Expansion Effective Date. The Premises shall be expanded to include
a space consisting of 3,076 rentable square feet adjacent to the
Premises on the sixth (6th) floor of the Building,

<PAGE> 27

which area is designated as the "Mandatory Expansion Space" on Exhibit
"A" attached hereto on that date (the "Expansion Effective Date") which
is the earliest to occur of (i) the first day of the eighteenth (18th)
month of the Lease Term; (ii) sixty (60) days after the later to occur
of the date of the Early Expansion Notice, as hereinafter defined, and
the Plan Approval Date, as hereinafter defined; and (iii) the date
Tenant occupies the Mandatory Expansion Space for any purpose. The
Expansion Effective Date shall occur irrespective of whether the
Mandatory Expansion Space has been delivered to Tenant, which delivery
is regulated by Subsection D of this Special Stipulation 4.

B. Approved Plans. Tenant shall submit plans for tenant improvements in
the Mandatory Expansion Space to Landlord, which shall be subject to
Landlord's approval. In the event Landlord disapproves such plans, the
parties shall negotiate in good faith to resolve their differences with
respect to such plans. The date of final approval of such plans shall
be the "Plan Approval Date", and such final approved plans shall be
hereinafter called the "Approved Plans".

C. Early Expansion Notice. Tenant shall have the right at any time from
the Commencement Date until the last day of the fifteenth (15th) full
calendar month of the Lease Term to notify Landlord that it desires
early possession of the Mandatory Expansion Space (the "Early Expansion
Notice").

D. Construction of Tenant Improvements. Landlord shall complete
construction of tenant improvements in the mandatory Expansion space in
accordance with the Approved Plans and in accordance with the terms of
the Tenant Improvement Agreement labeled Exhibit "C", and deliver the
Mandatory Expansion Space to Tenant, on or before the later to occur of
(i) sixty days after the Plan Approval Date; and (ii) the earlier to
occur of the date of the Early Expansion Notice and the first day of
the eighteenth (18th) full calendar month of the term of this Lease.
Landlord shall pay all of the costs of such tenant improvements up to
an amount equal to $15.00 multiplied by the number of square feet of
rentable area in the Mandatory Expansion Space. Tenant shall, within
(30) days after the date of Landlord's statement therefor, reimburse
Landlord for all costs of such tenant improvements exceeding such
amount.

E. Rental and Tenant's Percentage Share. From and after the Expansion
Effective Date, the Premises shall be deemed increased in size by the
number of square feet of rentable area in the Mandatory Expansion
Space, and the Base Rent and Additional Rent payable under this Lease,
as well as Tenant's Percentage Share, shall be increased
proportionately. On or before the Expansion Effective Date, Landlord
and Tenant will enter into an amendment to this Lease reflecting the
addition of the Mandatory Expansion Space to the Premises, the
resulting increase in the Base Rent and Additional Rent, and the
resulting adjustment to Tenant's Percentage Share, and making any such
other amendments as are necessary to reflect the intent of this Special
Stipulation.

S.S.5 RIGHT OF FIRST OFFER

Provided Tenant has leased the Mandatory Expansion Space as stipulated
in Paragraph S.S.4 herein and so long as the Right of First Offer Space
(as hereinafter defined) remains unencumbered and available for lease,
and subordinate to any existing rights of other tenants to lease said
space which exists as of the date of this Lease, Tenant shall have the
right, upon written notice from Landlord to lease during the term of
this Lease, subject to the terms and conditions below, additional space
consisting of a maximum of 5,042 rentable square feet but no

<PAGE> 28

less space than the demised available space so long as said space is
contiguous to the Premises (the "Right of First Offer Space") on the
sixth (6th) floor of the Building, as shown and designated on the
attached Exhibit "A", for a term coterminous with the expiration of the
initial term of this Lease and any renewal or extension thereof. The
Base Rental and the Tenant Improvement Allowance for the Right of First
Offer Space shall be set at the prevailing fair market value rates for
the Building then being charged by Landlord for comparable space to
third parties initially leasing in the Building.

Following the notice by Landlord to Tenant of this Right of First offer
at any time during the Lease Term, Tenant shall have ten (10) days in
which to respond in writing to exercise its right. This Right of First
Offer shall be cancelled and of no effect if Tenant fails to respond
within said ten (10) day period or if Tenant is in default of any
covenants under this Lease.

Within ten (10) days following the exercise of this Right of First
Offer, Landlord and Tenant shall enter into a written agreement
modifying and supplementing this Lease and specifying that the Right of
First Offer Space is part of the Leased Premises under this Lease and
containing other appropriate terms and conditions relating to the
addition of such areas to the Premises (including specifically any
increase, adjustment or augmentation of rent as a result of such
addition as aforesaid). Landlord will use its best efforts to make the
Right of First Offer Space available to Tenant within thirty (30) days
after Tenant's exercise of said Right of First Offer, but Landlord
shall not be liable for the failure to give possession of said Space to
Tenant within said thirty (30) day period by reason of the holding over
or retention of possession of any tenant, tenants or occupants, and
such failure shall not impair the validity of this Lease or extend the
term hereof, but the rent for the Right of First Offer Space shall be
abated until possession is delivered to Tenant, and such abatement
shall constitute full settlement of all claims that Tenant might
otherwise have against Landlord by reason of such failure to give
possession of the said Space to Tenant within thirty (30) days of
Tenant's exercise of this Right of First Offer. All rental obligations
of Tenant shall commence on the date such Space is made available to
Tenant.

S.S.6 PARKING

Parking in the parking deck for the Building for Tenant and Tenant's
employees and visitors shall be free of charge for the term of this
Lease and shall be available on an unassigned, first-come, first-served
basis. Three (3) of such parking spaces on the lower level of such
parking deck in a location determined by Landlord shall be marked as
spaces for the use of Tenant. Landlord shall have no responsibility for
the enforcement of Tenant's right to use any such parking spaces.

S.S.7 MOVING ALLOWANCE

Upon Tenant submitting to Landlord true and correct copies of invoices
for direct out-of-pocked expenses incurred by Tenant in moving from its
existing offices to the Premises, Landlord shall reimburse Tenant for
such amounts up to a maximum of $1.00 per rentable square foot of the
Premises up to 12,147 square feet of area. Landlord's obligation to pay
such amount to Tenant shall be subject to Tenant executing a Tenant
Acceptance Agreement (Exhibit "B") accepting the Premises. Landlord
shall have no liability for such moving and relocation cost in excess
of the Moving Allowance, and Landlord shall have no obligation to move
or have Tenant moved into the Premises.

<PAGE> 29

"TENANT"

E3 ASSOCIATES, INC.

By: /s/ Anders H. Herlitz
-----------------------------------------

Title: Chairman
--------------------------------------

"LANDLORD"

Two Park, Inc.
By: LaSalle Partners Asset
Management Limited, its authorized
agent

By: /s/ Bret E. Bunnett
-----------------------------------------

Title: Vice President
--------------------------------------

<PAGE> 30

EXHIBIT A

[E3 ASSOCIATES, LTD.

DIAGRAM OF PREMISES

TWO PARKWAY CENTER

SIXTH (6TH) FLOOR]

<PAGE> 31

EXHIBIT A-1

[DIAGRAM OF OFFICE SPACE]

<PAGE> 32

EXHIBIT B

TENANT ACCEPTANCE AGREEMENT

Agreement made this ___ day of ______________, 19, between
___________________________________________, a _______________________________
(hereinafter referred to as "Landlord") and
________________________________________, a _________________________________
(hereinafter referred to as "Tenant").

WHEREAS, Landlord and Tenant entered into a lease dated ____________,
19___ (hereinafter referred to as the "Lease") for ___________________ in the
building known as the _______________________ (hereinafter referred to as the
"Premises");

NOW, THEREFORE, pursuant to the provisions of Paragraph 2 of the Lease,
Landlord and Tenant mutually agree as follows:

1. The Commencement Date of the Lease Term is _______________, 19___.
The Expiration Date of the Lease Term is _________________, 19____.

2. Subject to its "Punch List", Tenant is in possession of, and has
accepted, the Premises demised by the Lease, and acknowledges that all the work
to be performed by the Landlord in the Premises as required by the terms of the
Lease has been satisfactorily completed. Subject to its "Punch List", Tenant
further certifies that all conditions of the Lease required of Landlord as of
this date have been fulfilled and there are no defenses or set-offs against the
enforcement of the Lease by Landlord.

IN WITNESS WHEREOF, the parties hereto have signed and sealed this
Agreement, the ____ day of ______________, 19_____.

TENANT:

E3 Associates, Ltd.

By:__________________________________

Its:________________________________

LANDLORD:

Two Park, Inc.
By: LaSalle Partners Asset Management
Limited, its authorized agent

By:_________________________________

Title:________________________________

Date:________________________________

<PAGE> 33

EXHIBIT C

TENANT IMPROVEMENT AGREEMENT

WHEREAS, the undersigned Landlord and Tenant have executed, sealed, and
delivered a certain Office Lease (the "Lease") to which this Agreement is
attached, and into which this Agreement is fully incorporated by reference, as
Exhibit C;

WHEREAS, said Lease provides for the letting of space (the "Premises)
within 1800 Parkway Place located at Parkway Center, Marietta, Georgia (the
"Building");

WHEREAS, the terms "Landlord" and "Tenant", "Premises", "Usable Area",
and "Building" as used herein shall have the same meanings ascribed thereto as
set forth in the Lease; and

WHEREAS, Landlord and Tenant desire to set forth herein their
respective agreements regarding the improvement of the Premises;

NOW THEREFORE, in consideration of the premises, the execution and
delivery of the Lease by the parties hereto, the mutual covenants contained
herein, and other good and valuable considerations, the receipt and sufficiency
of which are hereby acknowledged, Landlord and Tenant, intending to be legally
bound, hereby agree as follows:

Section 1. Tenant Improvements.

Section 1.01 Definition.

The term "Tenant Improvements" shall mean all improvements
constructed or installed in or on the Premises in accordance with the Drawings
and specifications, as hereinafter defined.

Section 1.02 Base Building Condition.

The term "Base Building Condition" shall mean the condition of the
Premises prior to commencement of the work of constructing and installing the
Tenant Improvements, which condition is described on Exhibit A hereto.

Section 2. Drawings and Specifications.

Section 2.01 Definition.

The term "Drawings and Specifications" shall mean the final drawings,
specifications, and finish schedules for the Tenant Improvements which shall be
prepared and approved by Landlord and Tenant in accordance with the following
procedure:

(a) Simultaneous with the execution of this Tenant Improvement
Agreement, Landlord shall provide Tenant with drawings which reflect the Base
Building Condition of the Premises.

(b) As soon as reasonably possible after receiving the drawings
described in (a) above, but in no event later than ten (10) days thereafter,
Tenant shall either inform Landlord that Tenant desires to use Landlord's
Architect to prepare final working drawings, specifications, finish schedules,
and the

<PAGE> 34

like necessary to commence construction of the Tenant Improvements or inform
Landlord of the identity of the architect or other design specialist whom Tenant
desires to use for such work. Landlord shall have the right of reasonable
approval over any architect or other design specialist selected by Tenant and
shall advise Tenant promptly of Landlord's decision either approving or
disapproving the person or firm selected by Tenant. As provided in Section
3.03(b) hereof, the cost of preparing the drawings, specifications, finish
schedules and the like as set forth in Sections 2.01(b) through (d) hereof shall
be a part of the Landlord's Allowance for Tenant Improvement costs.

(c) If Tenant elects to use Landlord's Architect as provided in
subparagraph (b) above, Tenant shall commence working with said Architect
promptly so that final working drawings and the like can be prepared for
Landlord's approval. If Tenant elects to use an independent architect or design
specialist and if the same in approved by Landlord, Tenant agrees to commence
working with such professional promptly. The architect selected by Tenant, and,
if necessary, approved by Landlord, shall hereinafter be referred to as the
"Tenant's Architect".

(d) As soon as reasonably possible, but no more than thirty (30)
days after making its election under subparagraph (c) above, Tenant shall
deliver to Landlord Tenant's proposed final working drawings, specifications,
finish schedules, and the like for the Tenant Improvements. Landlord shall
promptly review and resubmit the same to Tenant, either with Landlord's
approval, or with Landlord's disapproval. If Landlord fails to respond within
fifteen (15) days after receiving such proposed final drawings and the like,
Landlord shall be deemed to have given its full approval thereto. Tenant shall
resubmit any such drawings and the like which are returned by Landlord without
complete approval as promptly as possible, and such resubmitted drawings and the
like shall contain the information or changes required by Landlord. Once
Landlord then satisfies itself that such drawings, specifications, finish
schedules, and the like are acceptable, Landlord shall so notify Tenant and the
same shall constitute the "Drawings and Specifications" for purposes of this
Tenant Improvement Agreement.

(e) On or before the fifteenth (15th) day following receipt of the
Drawings and Specifications, Landlord shall obtain from Landlord's Contractor a
price schedule for the Tenant Improvements and shall submit the name to Tenant
for its approval. If Tenant disapproves such price schedule, Tenant agrees to
work promptly with Tenant's Architect and Landlord's Contractor to alter the
Drawings and Specifications as necessary to cause the price quotation based
thereon to be acceptable to Tenant. The aggregate cost for the Tenant
Improvements, once approved by Tenant, shall hereinafter be referred to as
"Tenant Improvement Costs". Upon determination of the Tenant Improvement Costs,
Tenant shall be deemed to have given final approval to the Drawings and
Specifications and Landlord shall be deemed to have been authorized to proceed,
through Landlord's Contractor, with the work of constructing and installing the
Tenant Improvements in accordance with the Drawings and Specifications.

Section 3. Payment of Costs.

Section 3.01. Landlord's Costs for Preliminary Drawings.

Landlord shall bear the cost of preparing the drawings,
specifications, and finish schedules in Section 2.01(a) above.

Section 3.02. Landlord's Allowance for Tenant Improvement Costs.

<PAGE> 35

Landlord shall pay the Tenant Improvement Costs up to, but not
exceeding Landlord shall construct the space at the Landlord's cost according to
the plan attached, labeled Exhibit A-1. The cost of any additions or
modifications shall be the responsibility of the Tenant (the Landlord's
Allowance for Tenant Improvement Costs").

Section 3.03. Tenant's Costs.

The aggregate of all costs described in the following subparagraphs
(a) and (d) of this Section 3.03 are hereinafter referred to collectively as
"Tenants Costs".

(a) The Tenant Improvement Costs over and above the Landlord's
Allowance for Tenant Improvement Costs;

(b) The cost of preparing and finalizing all drawings,
specifications, finish schedules, and the like as set forth in Sections 2.01(b)
through (d) above shall be part of the Landlord's Allowance for Tenant
Improvement Costs.

(c) Fees for architects, engineers, interior designers, and other
professionals and design specialists incurred by Landlord or Tenant in
connection with the Tenant Improvements shall be part of the Landlord's
Allowance for Tenant Improvement Costs.

(d) The cost of making any and all changes in and to the Drawings and
Specifications and any and all increased costs in the Tenant Improvement Costs
resulting therefrom; and

In the event the aggregate of Tenant Costs, as defined above, exceeds Landlord's
Allowance for Tenant Improvement Costs, as specified in Section 3.02 above, then
Tenant shall promptly pay the excess to Landlord as additional rent, as set
forth in Section 3.04.

Section 3.04. Payment Schedule for Tenant's Costs.

Tenant shall pay to Landlord the Tenant's Costs as follows:

(a) Fifty percent (50%) of the amount of Tenant's Costs then known to
Landlord and Tenant shall be paid prior to the commencement of any work of
constructing and installing the Tenant Improvements;

(b) Forty percent (40%) of the amount of Tenant's Costs then known to
Landlord and Tenant shall be paid within thirty (30) calendar days after the
commencement of the work of constructing and installing the Tenant Improvements;
and

(c) The balance of Tenant's Costs shall be paid immediately upon
Landlord's notification to Tenant that the work of constructing and installing
the Tenant Improvements has been substantially completed.

Section 3.05. Changes in Drawings and Specifications.

<PAGE> 36

and modifications are approved, Landlord shall promptly submit the same to
Landlord's Contractor for pricing. The procedure for determining an approved
cost for such changes shall be as set forth in Section 2 above. Once a cost for
such changes has been approved, all references in this Agreement to "Drawings
and Specifications" shall be to the Drawings and Specifications adopted pursuant
to the procedures of Section 2 above, as changed and modified pursuant to this
Section 3.05, and all references to "Tenant Improvement Costs" shall be deemed
to include the aggregate approved cost for the changes as determined in this
Section 3.05. Once the changes and the costs therefore have been approved,
Tenant shall be deemed to have given full authorization to Landlord to proceed
with the work of constructing and installing the Tenant Improvements in
accordance with the Drawings and Specifications, as changed and modified.
Landlord, at its option, can require Tenant to pay in lump sum to Landlord any
and all increases in the Tenant Improvement Costs which result from approved
changes to the Drawings and Specifications. Any delays in completing the Tenant
Improvements which result from either changes in the Drawings and Specifications
made by Tenant or from the unavailability of materials specified by Tenant,
shall not operate to delay or extend the commencement date under the Lease nor
the payment of the base rental or other charges due under the Lease.

Section 3.06. Failure to Pay Tenant's Costs.

Failure by Tenant to pay Tenant's Costs in accordance with this
Section 3 will constitute a failure by Tenant to pay rent when due under the
Lease and shall therefore constitute an event of default by Tenant under the
Lease, and Landlord shall have all of the remedies available to it under this
Lease and at law or in equity for nonpayment of rent.

Section 3.07. Landlord's Disbursement Obligations.

Landlord agrees to disburse the Landlord's Allowance for Tenant
Improvement Costs and the Tenant's Costs (to the extent deposited by Tenant with
Landlord) to pay the Tenant Improvement Costs as and when the same become due
and payable. If exercising due diligence, Landlord shall be entitled to rely on
the accuracy of any and all invoices and fee statements for labor and materials
performed on or furnished to the Premises in connection with the Tenant
Improvements and to rely, to the extent submitted, on any and all certifications
as to Tenant Improvement Costs submitted by Landlord's Contractor and/or
Tenant's Architect. Tenant does hereby release and relieve Landlord from any
claims for damages and the like which may result from Landlord's paying an
inaccurate invoice, fee statement, or the like and does hereby indemnify and
agree to hold Landlord harmless and to defend Landlord from and against any and
all claims, damages, liability, or costs (including, without limitation,
attorneys' fees and court costs) which may arise or result from Landlord's
payment of Tenant Improvement Costs or the nonpayment thereof. Notwithstanding
the foregoing, the within release and indemnification of Landlord by Tenant
shall not release any other third parties, nor shall it waive any and all rights
which Tenant may have against other third parties in connection with the payment
or nonpayment of Tenant Improvement Costs.

Section 4. Finish Work in Addition to Tenant Improvements.

<PAGE> 37

constructing or installing the Tenant Improvements. Landlord shall give access
and entry to the Premises to Tenant and its contract parties performing such
additional work and reasonable opportunity and time to enable Tenant and such
contract parties to perform and complete much work. All of such additional work
and Tenant's use (and the use by its contract parties) of the Premises for such
purposes shall be entirely in accordance with the Lease, including without
limitation this Agreement.

Section 5. Time is of the Essence.

Time is of the essence of this Agreement. Unless specifically
provided otherwise, all references to days or months shall be construed as
references to calendar days or months, respectively.

IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement in duplicate, individually or through their respective authorized
officers, partners, agents of attorneys-in-fact, as the case may be, and sealed
this Agreement or caused their respective seals to be affixed hereto, the day
and year set forth to the left of their respective executions, the latest of
which is and shall be deemed to be the date of this Agreement.

TENANT:

By: /s/ Anders H. Herlitz
-------------------------------------
Title: Chairman
----------------------------------

LANDLORD:

Two Park, Inc.
By: LaSalle Partners Asset Management
Limited, its authorized agent

By:/s/ Bret Bunnett
-------------------------------------

Title: Vice President
----------------------------------

Date: 11/8/90
----------------------------------

<PAGE> 38

PARKWAY CENTER OFFICE BUILDING

EXHIBIT D

RULES AND REGULATIONS

1. The sidewalks, and public portions of the Building, such as
entrances, passages, courts, elevators, vestibules, stairways, corridors or
halls, and the streets, alleys or ways surrounding or in the vicinity of the
Building shall not be obstructed, even temporarily, or encumbered by Tenant or
used for any purpose other than ingress and egress to and from the Premises.

2. No awnings or other projections shall be attached to the outside
walls of the Building. No curtains, blinds, shades, louvered openings or screens
shall be attached to or hung in, or used in connection with, any window or door
of the Premises, without the prior written consent of Landlord, unless installed
by Landlord.

3. No sign, advertisement, notice or other lettering shall be
exhibited, inscribed, painted or affixed by Tenant on any part of the outside of
the Premises or Building or on corridor walls, or within 24 inches of the
surface of exterior windows. Signs on entrance door or doors shall conform to
building standard signs as established by Landlord. Signs on doors shall, at
Tenant's expense, be inscribed, painted or affixed for each tenant by sign
makers approved by Landlord. In the event of the violation of the foregoing by
Tenant, Landlord may remove same without any liability, and may charge the
expense incurred by such removal to Tenant.

4. The sashes, sash doors, skylights, windows, heating, ventilating and
air conditioning vents and doors that reflect or admit light and air into the
halls, passageways or other public places in the Building shall not be covered
or obstructed by Tenant. Drapes may be installed by Tenant provided existing
blinds remain installed.

5. No show cases or other articles shall be put in front of or affixed
to any part of the exterior of the Building, nor placed in the public halls,
corridors, or vestibules without the prior written consent of Landlord.

6. The water and wash closets and other plumbing fixtures shall not be
used for any purposes other than those for which they were constructed, and no
sweepings, rubbish, rags, or other substances shall be thrown therein. All
damages resulting from any misuse of the fixtures shall be borne by Tenant.

7. Tenant shall not in any way deface any part of the Premises or the
Building. Tenant shall not lay linoleum, or other similar floor covering, so
that the same shall come in direct contact with the floor of the Premises, and,
if linoleum or other similar floor covering is desired to be used, an
interlining of builder's deadening felt shall be first affixed to the floor, by
a paste or other material, soluble in water, the use of cement or other similar
adhesive material being expressly prohibited.

8. No bicycles, vehicles, or animals of any kind shall be brought into
or kept in or about the Premises. No cooking shall be done or permitted by
Tenant on the Premises except in conformity to law and then only in the utility
kitchen, if any, as set forth in Tenant's layout, which is to be primarily used
by Tenant's employees for heating beverages and light snacks. Tenant shall not
cause or permit any unusual or objectionable odors to be produced upon or
permeate from the Premises.

<PAGE> 39

9. No space in the Building shall be used for manufacturing,
distribution, or for the storage of merchandise or for the sale of merchandise,
goods, or property of any kind at auction.

10. Tenant shall not make, or permit to be made, any unseemly or
disturbing noises or disturb or interfere with occupants of the Building or
neighboring buildings or premises or those having business with them, whether by
the use of any musical instrument, radio, talking machine, unmusical noise,
whistling, singing, or in any other way. Tenant shall not throw anything out of
the doors, windows or skylights or down the passageways.

11. Neither Tenant, nor nay of Tenant's servants, employees, agents,
visitors, or licensees, shall at any time bring or keep upon the Premises any
inflammable, combustible or explosive fluid, or chemical substance, other than
reasonable amounts of cleaning fluids or solvents required in the normal
operation of Tenant's business offices.

12. No additional locks or bolts of any kind shall be placed upon any
of the doors or windows by Tenant, nor shall any changes be made in existing
locks of the mechanism thereof, without the prior written approval of Landlord
and unless and until a duplicate key is delivered to Landlord. Tenant shall upon
termination of its tenancy, restore to Landlord all keys, either furnished to,
or otherwise procured by, Tenant, and in the event of the loss of any keys so
furnished, Tenant shall pay to Landlord the cost thereof.

13. Tenant shall not overload any floor. Tenant shall obtain Landlord's
consent before bringing any safes, freight, furniture, or bulky articles into
the Building and Landlord can specify to Tenant the location for the placement
of such articles. All removals, or the carrying in or out of any safes, freight,
furniture, or bulky matters of any description must take place during the hours
which Landlord or its agent may determine from time to time. Landlord reserves
the right to inspect all freight to be brought into the Building and to exclude
from the Building all freight which violates any of these Rules and Regulations
or the Lease of which these Rules and Regulations are a part.

14. Tenant shall not occupy or permit any portion of the Premises to be
occupied, without Landlord's expressed prior written consent, as an office for a
public stenographer or typist, or for the possession, storage, manufacture or
sale of liquor, narcotics, dope, tobacco in any form, or as a barber or manicure
shop, or as a public employment bureau or agency, or for a pubic finance
(personal loan) business. Tenant shall not engage or pay any employees on the
Premises, except those actually working for Tenant on said premises, not
advertise for laborers giving an address at the Building.

15. Tenant agrees to employ such janitorial contractor as Landlord may
form time to time designate, for any waxing, polishing, and other maintenance
work of the Premises and of the Tenant's furniture, fixtures and equipment.
Tenant agrees that it shall not employ any other cleaning and maintenance
contractor, not any individual, firm or organization for such purpose without
Landlord's prior written consent.

16. Landlord shall have the right to prohibit any advertising by Tenant
which, in Landlord's opinion, tends to impair the reputation of the Building or
its desirability as a building for offices, and upon written notice from
Landlord, Tenant shall refrain from or discontinue such advertising.

17. Landlord reserves the right to exclude from the Building at all
times other than business hours all persons who do not present a pass to the
Building signed by tenants. Tenant shall be

<PAGE> 40

responsible for all persons for whom it issues such pass and shall be liable to
Landlord for all acts of such persons.

18. At the option of Landlord, Tenant agrees to purchase from Landlord
or its agents all lamps and bulbs used in the Premises and to pay for the cost
of installation thereof.

19. The Premises shall not be used for lodging or sleeping or for any
immoral or illegal purpose.

20. The requirements of Tenant will be attended to only upon
application at the office of the Building. Building employees shall not perform
any work or do anything outside of their regular duties, unless under special
instructions from the office of Landlord.

21. Canvassing, soliciting, and peddling in the Building are prohibited
and Tenant shall cooperate to prevent the same.

22. There shall not be used in any space, or in the public halls of any
building, either by Tenant or by its jobbers or others, in the delivery or
receipt of merchandise, any hand trucks, except those equipped with rubber tires
and side guards. No hand trucks shall be used in passenger elevators.

23. In order to obtain maximum effectiveness of the cooling system,
Tenant shall lower and/or close the blinds or drapes when sun's rays fall
directly on windows of Premises. Tenant shall not remove the standard blinds
installed in the Premises.

24. All paneling or other wood products not considered furniture shall
be of fire-retardant materials. Before installation of any such materials,
certification of the materials, fire-retardant characteristics shall be
submitted to Landlord or its agents, in a manner satisfactory to Landlord.

25. Tenant shall not install any vending machines in the Building or
Premises without Landlord's consent.

26. Landlord may waive any one or more of these Rules and Regulations
for the benefit of any particular Tenant or Tenants, but no such waiver by
Landlord shall be construed as a waiver of such Rules and Regulations in favor
of any other Tenant or Tenants, nor prevent Landlord from thereafter enforcing
any such Rules and Regulations against any or all Tenants of the Building.

27. Landlord reserves the right to make such other and reasonable rules
and regulations as in its judgment may from time to time be needed for safety
and security, for care and cleanliness of the Building and for the preservation
of good order therein. Tenant agrees to abide by all such Rules and Regulations
hereinabove stated and any reasonable additional rules and regulations which are
adopted.

Whenever the above rules conflict with any of the rights or obligations
of Tenant pursuant to the provisions of the Paragraphs of this Lease, the
provisions of the Paragraphs shall govern.

<PAGE> 1
EXHIBIT 10.2

AMENDMENT TO LEASE AGREEMENT

THIS AMENDMENT TO LEASE AGREEMENT (the "Amendment"), entered into as of
the 14th day of August, 1995, by and between TWO PARK, INC., a Georgia
corporation having LaSalle Partners Management Limited as its duly authorized
agent (hereinafter referred to as the "Landlord"), and E3 ASSOCIATES, LTD., a
Georgia corporation (hereinafter referred to as the "Tenant").

W I T N E S S E T H :

WHEREAS, Landlord and Tenant have entered into that certain Two Parkway
Center Lease Agreement, dated November 8, 1990 (the "Lease"), with respect to
certain premises consisting, as of the date hereof, of 15,223 square feet of
Rentable Area and known as Suite 600, 1800 Parkway Place, Marietta, Georgia, as
more particularly described in the Lease (the "Existing Premises") upon the
terms and conditions more particularly set forth therein; and

WHEREAS, Landlord and Tenant desire to amend the Lease in certain
respects;

NOW, THEREFORE, for and in consideration of the premises and the sum of
TEN AND NO/100 DOLLARS ($10.00) and other good and valuable consideration, the
receipt, adequacy and sufficiency of which are hereby acknowledged, Landlord and
Tenant do hereby covenant and agree as follows:

1. DEFINITIONS. The Lease is hereby modified as provided below.
All capitalized terms used in this Amendment which are not defined herein shall
have the meanings ascribed to such terms in the Lease. All references in the
Lease or in this Amendment to "the Lease" or "this Lease" shall be deemed
references to the Lease as amended by this Amendment.

2. EXPANSION. Effective on January 1, 1996 (the "Expansion
Date"), the Premises shall be expanded to include the space, consisting of 9,659
square feet of Rentable Area, as outlined on the floor plan attached hereto and
made a part hereof as Exhibit "A", and identified thereon as the "New Space."
The New Space is comprised of 4,873 square feet of Rentable Area in Suite 315 on
the third (3rd) floor of the Building and 4,786 square feet of Rentable Area in
Suite 605 on the sixth (6th) floor of the Building. From and after the Expansion
Date, the term "Rentable Area of the Premises," as defined in Paragraph 1.4 of
the Lease, shall mean for all purposes, including without limitation the
calculation of Base Rental, 24,882 square feet, and "Tenant's Percentage Share"
shall be 10.9611%.

3. EXTENSION. For purposes of Paragraph 1.7 of the Lease, the end
of the Lease Term is hereby extended from December 31, 1995 to February 28, 2001
(which date shall be referred to herein and in the Lease as the "Expiration
Date").

4. BASE RENTAL; ADDITIONAL RENT; REIMBURSEMENTS.

(a) Paragraph S.S.2 of the Special Stipulations to the
Lease is hereby amended to provide that the Base Rental for the
Existing Premises and the New Space, effective on

1
<PAGE> 2
the Expansion Date, shall be $19.85 per square foot of Rentable Area
within the Existing Premises and the New Space per year, payable
monthly as provided in Paragraph 4.1 of the Lease. The Base Rental
shall continue to be subject to increase pursuant to Paragraph 4.2 of
the Lease, commencing with the year 1996 with respect to the Base
Rental for the Existing Premises and the New Space; provided, however,
that such increase shall be determined by multiplying the Base Rental
in force at the end of each calendar year times forty percent (40%) of
the percentage increase in the index for the month of December of the
immediately preceding calendar year, subject to a maximum annual
increase in the Index of nine percent (9%).

(b) Commencing on the date hereof and continuing through
and including December 31, 1995, Tenant shall remain obligated to pay
to Landlord as additional rent under the Lease Tenant's Percentage
Share of Increases in Operating Expenses for the Existing Premises, as
provided in Paragraphs 1.6(c) and 4.3 of the Lease. Effective on the
Expansion Date, the "Base Year" for purposes of Paragraphs 1.6(c) and
4.3 of the Lease for the Existing Premises and the New Space shall be
the year 1996. Accordingly, for each calendar year during the Lease
Term commencing with the year 1997, Tenant shall pay to Landlord, as
additional rent under Paragraph 4.3 of the Lease with respect to the
Existing Premises and the New Space, an amount equal to Tenant's
Percentage Share of the total dollar increase, if any, in Operating
Expenses paid or incurred by Landlord in such Adjustment Year over the
Base Operating Expenses. Anything to the contrary herein
notwithstanding, the Base Rental and other sums due Landlord under the
Lease with respect to the Existing Premises shall continue to be due
and payable in accordance with the terms of the Lease with respect to
the Existing Premises until the Expansion Date.

(c) Notwithstanding anything herein to the contrary,
Landlord shall reimburse Tenant up to a maximum amount of $9,659.00 for
moving expenses incurred in connection with Tenant's expansion
including, but not limited to, cabling and computer and telephone
wiring. Landlord shall so reimburse Tenant within forty-five (45) days
following receipt by Landlord of invoices evidencing such expenses.

5. TENANT IMPROVEMENTS.

2
<PAGE> 3
Base Rental with respect to the New Space set forth in Paragraph 4(a)
above, shall be postponed for a like period of time equal to the number
of days of such delay. No delay in delivery of possession of the New
Space or postponement of the Expansion Date shall operate to relieve
Tenant of Tenant's obligations to Landlord as provided in the Lease,
including, without limitation, the obligation to pay Base Rental,
except as hereinabove set forth. That portion of the Tenant
Improvements to be constructed in the Existing Premises may be
completed by Landlord simultaneously with those Tenant Improvements to
be constructed in the New Space. All Tenant Improvements shall be
constructed by Landlord's Contractor who shall be selected by Landlord
pursuant to a bid process whereby at least three contractors selected
by Landlord will bid upon the work with Landlord selecting the
successful bidder. Landlord and Tenant agree to execute a Tenant
Acceptance Agreement, as described in Paragraph 2.5 of the Lease,
setting forth the Expansion Date and Expiration Date within twenty (20)
days after Tenant takes occupancy of the New Space.

(b) Landlord agrees to construct or install in the
Existing Premises and the New Space the "Tenant Improvements," as
defined in and to be constructed or installed pursuant to the
provisions of the Tenant Improvement Agreement which is attached hereto
as Exhibit "B". Tenant agrees to comply with all the terms and
provisions of the Tenant Improvement Agreement, including, without
limitation, the obligation to pay, as additional rent, all amounts due
Landlord under Paragraph 3 thereof according to the payment provisions
contained in said Paragraph 3.

6. EARLY OCCUPANCY. The Lease Term for Suite 315 of the New Space
shall not commence until the Expansion Date; provided, however, that if Suite
315 is available prior to that date (with no representation or warranty
whatsoever as to whether or not such premises shall be so available), Landlord
will permit Tenant to occupy Suite 315 prior to the Expansion Date under the
terms and conditions of the Lease, but without the payment of any Base Rental or
any additional rent which otherwise would be payable hereunder for such period
prior to the Expansion Date.

7. SECURITY DEPOSIT. Provided Tenant is not then in default under
the terms of this Lease, upon the date three (3) months after the later to occur
of (i) the Expansion Date, or (ii) the date the New Space is substantially
completed and available for Tenant's occupancy, Landlord shall reimburse to
Tenant that portion of the Security Deposit then held by Landlord. From and
after such payment to Tenant, Paragraph 4.5 of the Lease shall have no further
force or effect.

8. BROKER. Tenant represents and warrants to Landlord that no
broker, agent, commissioned salesman, or other person has represented Tenant in
the negotiations for and procurement of this Amendment and that no commissions,
fees, or compensation of any kind are due and payable in connection herewith to
any broker, agent, commissioned salesman, or other person. Tenant agrees to
indemnify and hold Landlord harmless from any and all claims, suits, or
judgments (including, without limitation, reasonable attorneys' fees and court
costs incurred in connection with any such claims, suits, or judgments) for any
fees, commissions or

3
<PAGE> 4
compensation or any kind which arise out of or are in any way connected with any
claimed agency relationship with Tenant. Landlord represents and warrants to
Tenant that no broker, agent, commissioned salesman, or other person has
represented Landlord in the negotiations for and procurement of this Amendment
and that no commissions, fees, or compensation of any kind are due and payable
in connection herewith to any broker, agent, commissioned salesman or other
person. Landlord agrees to indemnify and hold Tenant harmless from any and all
claims, suits or judgments (including, without limitation, reasonable attorneys'
fees and court costs incurred in connection with any such claims, suits or
judgments) for any fees, commissions, or compensation of any kind which arise
out of or are in any way connected with any claimed agency relationship with
Landlord.

9. MISCELLANEOUS. Exhibit "C" to the Lease and Paragraphs
numbered S.S.1, S.S.5 and S.S.7 of the Special Stipulations to the Lease are
hereby deleted from the Lease and shall have no further force or effect. Except
as expressly modified herein, the Lease shall remain in full force and effect
and Landlord and Tenant to hereby ratify and confirm the terms and conditions of
the Lease, as amended by this Amendment. This Amendment shall be binding upon
the executors, administrators, heirs, successors and assigns of Landlord and
Tenant, to the extent permitted under the Lease.

[THIS SPACE INTENTIONALLY LEFT BLANK]

4
<PAGE> 5
IN WITNESS WHEREOF, Landlord and Tenant have caused this Amendment to
be executed under seal by their duly authorized officers or representatives as
of the day and year first above written.

"TENANT"

E3 ASSOCIATES, LTD.

By: /s/ Frank K. Schuster
Print Name: Frank K. Schuster
Title: C.F.O./Exec. V.P.

Attest: /s/ Daniel J. Craddock (SEAL)
Print Name: Daniel J. Craddock
Title: Vice President

(SEAL)

"LANDLORD"

TWO PARK, INC.

By: LaSalle Partners Management Limited,
Its authorized agent

By: /s/ Stephen P. Vale (SEAL)
Title: Vice President

5
<PAGE> 6
EXHIBIT A

[DESCRIPTION OF PREMISES]
<PAGE> 7
EXHIBIT B

TENANT IMPROVEMENT AGREEMENT

WHEREAS, the undersigned Landlord and Tenant have executed, sealed and
delivered a certain Amendment to Lease Agreement to which this Agreement is
attached, and into which this Agreement is fully incorporated by reference, as
Exhibit B;

WHEREAS, said Amendment amends and modifies that certain Two Parkway
Center Lease Agreement between Landlord and Tenant dated November 8, 1990 (the
"Lease"), which Lease, amended as aforesaid, provides for the letting of space
(the "Premises") within 1800 Parkway Place located at Two Parkway Center,
Marietta, Georgia (the "Building");

WHEREAS, the terms "Landlord" and "Tenant," "Premises," "Existing
Premises," "New Space," "Usable Area," and "Building" as used herein shall have
the same meanings ascribed thereto as set forth in the Lease, as amended by said
Amendment; and

WHEREAS, Landlord and Tenant desire to set forth herein their
respective agreements regarding the improvement of the Premises;

NOW, THEREFORE, in consideration of the premises, the execution and
delivery of the Lease by the parties hereto, the mutual covenants contained
herein, and other good and valuable considerations, the receipt and sufficiency
of which are hereby acknowledged, Landlord and Tenant, intending to be legally
bound, hereby agree as follows:

Section 1. Tenant Improvements.

Section 1.01 Definition.

The term "Tenant Improvements" shall mean all improvements constructed or
installed in or on the Premises in accordance with the Drawings and
Specifications, as hereinafter defined.

Section 1.02 Base Building Condition.

The term "Base Building Condition" shall mean the condition of the Premises
prior to commencement of the work of constructing and installing the Tenant
Improvements.

Section 2. Drawings and Specifications.

Section 2.01 Definition.

The term "Drawings and Specification" shall mean the final drawings,
specifications and finish schedules for the Tenant Improvements which shall be
prepared and approved by Landlord and Tenant in accordance with the following
procedure:

B-1
<PAGE> 8
(a) Tenant desires to use Landlord's Architect to prepare
final working drawings, specifications, finish schedules, and the like
necessary to commence construction of the Tenant Improvements. As
provided in Section 3.01 hereof, the cost of preparing the drawings,
specifications, finish schedules and the like as set forth in this
Section 2.01 shall be paid by Landlord and shall not be a part of
Tenant's Costs.

(b) On or before the fifth (5th) day following receipt of
the Drawings and Specifications, Landlord shall obtain from Landlord's
Contractor a price schedule for the Tenant Improvements and shall
submit the same to Tenant for its approval. If Tenant disapproves such
price schedule, Tenant agrees to work promptly with Landlord's
Architect and Landlord's Contractor to alter the Drawings and
Specifications as necessary to cause the price quotation based thereon
to be acceptable to Tenant. The aggregate cost the Tenant Improvements,
once approved by Tenant, shall hereinafter be referred to as "Tenant
Improvement Costs." Upon determination of the Tenant Improvement Costs,
Tenant shall be deemed to have given final approval to the Drawings and
Specifications and Landlord shall be deemed to have been authorized to
proceed, through Landlord's Contractor, with the work of constructing
and installing the Tenant Improvements in accordance with the Drawings
and Specifications.

Section 3. Payment of Costs.

Section 3.01 Landlord's Costs for Preliminary Drawings.

Landlord shall bear the cost of preparing the drawings, specifications and
finish schedules in Section 2.01 above.

Section 3.02 Landlord's Allowance for Tenant Improvement Costs.

Landlord shall pay the Tenant Improvement Costs up to $8.00 per square foot of
Rentable Area in the Existing Premises, or $121,784.00 based upon 15.223 square
feet of Rentable Area in the Existing Premises, and $12.00 per square foot of
Rentable Area in the New Space, or $115,908.00 based upon 9,659 square feet of
Rentable Area in the New Space. Accordingly, to the total amount to be paid by
Landlord for the Tenant Improvement Costs for the Existing Premises and the New
Space shall not exceed, in the aggregate, $237,692.00 ("Landlord's Allowance for
Tenant Improvement Costs"). The Landlord's Allowance for Tenant Improvement
Costs may be allocated between the Existing Premises and the New Space at
Tenant's discretion but must be expended on permanent and semi-permanent
finishes and improvements (not eligible are items such as furniture,
telecommunications and/or computer wiring or equipment, moving expenses etc.).
All improvements made from concrete slab to concrete deck shall be deducted from
this allowance. Any unused portion of Landlord's Allowance for Tenant
Improvement Costs, up to a maximum of $48,000.00, may, at Tenant's option, (i)
be used to reimburse Tenant (against invoices submitted to landlord by Tenant)
for Tenant's expenses directly associated with Tenant's expansion, including,
but not limited to, cabling and computer and telephone wiring; or (ii) be
credited by Landlord against Base Rental

B-2
<PAGE> 9
due under the Lease, as amended by the aforementioned Amendment, commencing on
the later to occur of the Expansion Date or the first day of the first month
following the date upon which construction of the Tenant Improvements has been
substantially completed until such time as said unused portion of Landlord's
Allowance for Tenant Improvement Costs is exhausted. Tenant shall have no claim
to the unused portion of the Landlord's Allowance for Tenant Improvement Costs
which exceeds said $48,000.00.

Section 3.03 Tenant's Costs.

The aggregate of all costs described in the following subparagraphs (a) through
(c) of this Section 3.03 are hereinafter referred to collectively as "Tenant
Costs."

(a) The Tenant Improvement Costs over and above the
Landlord's Allowance for Tenant Improvement Costs;

(b) Fees for architects, engineers, interior designers,
and other professionals and design specialists incurred by Tenant in
connection with the Tenant Improvements; and

(c) The cost of making any and all changes in and to the
Drawings and Specifications and any and all increased costs in the
Tenant Improvement Costs resulting therefrom; and in the event the
aggregate of Tenant Costs, as defined above, exceeds Landlord's
Allowance for Tenant Improvements Costs, as specified in Section 3.02
above, then Tenant shall promptly pay the excess to landlord as
additional rent, as set forth in Section 3.04.

Section 3.04 Payment Schedule for Tenant's Costs.

Tenant shall pay to Landlord the Tenant's Costs as follows:

(a) Fifty percent (50%) of the amount of Tenant's Costs
then known to Landlord and Tenant shall be paid prior to the
commencement of any work of constructing and installing the Tenant
Improvements;

(b) Forty percent (40%) of the amount of Tenant's Costs
then known to Landlord and Tenant shall be paid within thirty (30)
calendar days after the commencement of the work of constructing and
installing the Tenant Improvements; and

(c) The balance of Tenant's Costs shall be paid
immediately upon Landlord's notification to Tenant that the work of
constructing and installing the Tenant Improvements has been
substantially completed.

B-3
<PAGE> 10
Section 3.05 Changes in Drawings and Specifications.

If at any time after the Tenant Improvement Costs are determined Tenant desires
to make changes in the Drawings and Specifications, Tenant shall submit to
Landlord for approval working drawings, specifications, and finish schedules for
any and all such desired changes. The process of finalizing such drawings and
the like shall be as set forth in Section 2 above. Once any and all changes and
modifications are approved, Landlord shall promptly submit the same to
Landlord's Contractor for pricing. The procedure for determining an approved
cost for such changes shall be as set forth in Section 2 above. Once a cost for
such changes has been approved, all references in this Agreement to "Drawings
and Specifications" shall be to the Drawings and Specifications adopted pursuant
to the procedures of Section 2 above, as changed and modified pursuant to this
Section 3.05, and all references to "Tenant Improvement Costs" shall be deemed
to include the aggregate approved cost for the changes as determined in this
Section 3.05. Once the changes and the costs therefore have been approved,
Tenant shall be deemed to have given full authorization to Landlord to proceed
with the work of constructing and installing the Tenant Improvements in
accordance with the Drawings and Specifications, as changed and modified.
Landlord, at its option, can require Tenant to pay in lump sum to Landlord any
and all increases in the Tenant Improvement Costs which result from approved
changes to the Drawings and Specifications and which also result in the cost
being above the Landlord's Allowance for Tenant Improvement Costs. Any delays in
completing the Tenant Improvements which result from either changes in the
Drawings and Specifications made by Tenant or from the unavailability of
materials specified by Tenant, shall not operate to delay or extend the
commencement date under the Lease nor the payment of the base rental or other
charges due under the Lease.

Section 3.06 Failure to Pay Tenant's Costs.

Failure by Tenant to pay Tenant's Costs in accordance with this Section 3 will
constitute a failure by Tenant to pay rent when due under the Lease and shall
therefore constitute an event of default by Tenant under the Lease, and Landlord
shall have all the remedies available to it under this Lease and at law or in
equity for nonpayment of rent.

Section 3.07 Landlord's Disbursement Obligations.

Landlord agrees to disburse the Landlord's Allowance for Tenant Improvement
Costs and the Tenant's Costs (to the extent deposited by Tenant with Landlord)
to pay the Tenant Improvement Costs as and when the same become due and payable.
Landlord shall be entitled to rely on the accuracy of any and all invoices and
fee statements for labor and materials performed on or furnished to the Premises
in connection with the Tenant Improvements and to rely, to the extent submitted,
on any and all certifications as to Tenant Improvement Costs submitted by
Landlord's Contractor and/or Landlord's Architect Tenant does hereby release and
relieve Landlord from any claims for damages and the like which may result from
Landlord's paying an inaccurate invoice, fee statement, or the like and does
hereby indemnify and agree to hold landlord harmless and to defend Landlord from
and against any and all claims, damages, liability, or costs (including, without
limitation, attorneys' fees and court costs) which may arise or result from

B-4
<PAGE> 11
Landlord's payment of Tenant Improvement Costs or the nonpayment thereof.
Notwithstanding the foregoing, the within release and indemnification of
Landlord by Tenant shall not release any other third parties, nor shall it waive
any and all rights which Tenant may have against other third parties in
connection with the payment or nonpayment of Tenant Improvement Costs.

Section 4. Finish Work in Addition to Tenant Improvements.

All work in or about the Premises which is not within the scope of the work
necessary to construct and install the Tenant Improvements, such as delivering
and installing furniture, telephone equipment, and wiring, and office equipment
and computer wiring, shall be furnished and installed by Tenant entirely at
Tenant's expenses. Tenant shall adopt a schedule for performing such additional
work consistent with the schedule of Landlord's Contractor and shall see that
such work is conducted in such a manner as to maintain harmonious labor
relations and so as not to interfere unreasonably with or to delay the work of
constructing or installing the Tenant Improvements. Landlord shall give access
and entry to the Premises to Tenant and its contract parties performing such
additional work and reasonably opportunity and time to enable Tenant and such
contract parties to perform and complete such work. All of such additional work
and Tenant" use (and the use by its contract parties) of the Premises for such
purposes shall be entirely in accordance with the Lease, including without
limitation this Agreement.

Section 5. Time is of the Essence.

Time is of the essence of this Agreement. Unless specifically provided
otherwise, all references to days or months shall be construed as references to
calendar days or months, respectively.

[THIS SPACE INTENTIONALLY LEFT BLANK]

B-5
<PAGE> 12
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement in duplicate, individually or through their respective authorized
officers, partners, agents or attorneys-in-fact, as the case may be, and sealed
this Agreement or caused their respective seals to be affixed hereto, the day
and year set forth below their respective executions, the latest of which is and
shall be deemed to be the date of this Agreement.

"TENANT"

E3 ASSOCIATES, LTD.

By: /s/ Frank K. Schuster (SEAL)
Print Name: Frank K. Schuster
Title: C.F.O./Exec. V.P.

Date: 8/4/95

Attest: /s/ Daniel J. Craddock (SEAL)
Print Name: Daniel J. Craddock
Title: Vice President

Date: 8/4/95

"LANDLORD"

TWO PARK, INC.

By: LaSalle Partners Management Limited,
Its authorized agent

By: /s/ Stephen P. Vale (SEAL)
Title: Vice President

Date: 8/14/95

B-6

<PAGE> 1
EXHIBIT 10.3

SECOND AMENDMENT TO LEASE AGREEMENT

THIS SECOND AMENDMENT TO LEASE AGREEMENT (the "Amendment"), entered
into as of the 22nd day of April, 1996, by and between TWO PARK, INC., a Georgia
corporation having LaSalle Partners Management Limited as its duly authorized
agent (hereinafter referred to as the "Landlord"), and E3 ASSOCIATES, LTD., a
Georgia corporation (hereinafter referred to as the "Tenant").

W I T N E S S E T H :

WHEREAS, Landlord and Tenant have entered into that certain Two Parkway
Center Lease Agreement, dated November 8, 1990 (the "Lease"), as amended by
Amendment to Lease, dated August 14, 1995 (the "Lease"), with respect to certain
premises consisting, as of the date hereof, of 24,882 square feet of Rentable
Area and known as Suites 315, 600 and 605, 1800 Parkway Place, Marietta,
Georgia, as more particularly described in the Lease (the "Existing Premises")
upon the terms and conditions more particularly set forth therein; and

WHEREAS, Landlord and Tenant desire to amend the Lease in certain
respects;

2. EXPANSION. Effective on July 1, 1996 (the "Expansion Date"),
the Premises shall be expanded to include the space consisting of 3,724 square
feet of Rentable Area in Suite 320 on the third (3rd) floor of the Building, as
outlined on the floor plan attached hereto and made a part hereof as Exhibit
"A", and identified thereon as the "New Space" (the "New Space"). From and after
the Expansion Date, the term "Rentable Area of the Premises," as defined in
Paragraph 1.4 of the Lease, shall mean for all purposes, including without
limitation the calculation of Base Rental, 28,606 square feet, and "Tenant's
Percentage Share" shall be 12.6016%. The Expiration Date as to both the Existing
Premises and the New Space shall continue to be February 28, 2001.

3. BASE RENTAL; ADDITIONAL RENT; REIMBURSEMENTS.

(a) Paragraph S.S.2 of the Special Stipulations to the
Lease is hereby amended to provide that the Base Rental for the New
Space, effective on the Expansion Date, shall be $20.65 per square foot
of Rentable Area within the New Space per year, payable monthly as
provided in Paragraph 4.1 of the Lease. The Base Rental for the New
Space shall be subject to increase pursuant to Paragraph 4.2 of the
Lease, commencing with the

1
<PAGE> 2
year 1997; provided, however, that such increase shall be determined by
multiplying the Base Rental in force at the end of each calendar year
times forty percent (40%) of the percentage increase in the Index for
the month of December of the immediately preceding calendar year,
subject to a maximum annual increase in the Index of nine percent (9%).
Accordingly, effective on the Expansion Date, Base Rental for the New
Space shall be as follows:

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------
PERIOD EFFECTIVE $/ RESULTING ANNUAL BASE RESULTING MONTHLY BASE
RSF RENTAL RENTAL
----------------------------------------------------------------------------------
<S> <C> <C> <C>
----------------------------------------------------------------------------------
7/1/96 -
2/28/2001 $20.65 $76,901.00 $6,408.00
----------------------------------------------------------------------------------
</TABLE>

(b) Effective on the Expansion Date, the "Base Year" for
purposes of Paragraphs 1.6(c) and 4.3 of the Lease for the New Space
shall be the year 1996. Accordingly, for each calendar year during the
Lease Term commencing with the year 1997, Tenant shall pay to Landlord,
as additional rent under Paragraph 4.3 of the Lease with respect to the
New Space, an amount equal to Tenant's Percentage Share of the total
dollar increase, if any, in Operating Expenses paid or incurred by
Landlord in such Adjustment Year over the Base Operating Expenses.
Anything to the contrary herein notwithstanding, the Base Rental and
other sums due Landlord under the Lease with respect to the Existing
Premises shall continue to be due and payable in accordance with the
terms of the Lease.

4. TENANT IMPROVEMENTS.

(a) Tenant takes and accepts the New Space from Landlord
in its present as-is condition and as suited for the use intended by
Tenant, except for such improvements as may be expressly provided for
in the Tenant Improvement Agreement attached hereto and made a part
hereof as Exhibit "B". If, for any reason whatsoever, the New Space is
not substantially completed by July 1, 1996 or if Landlord, for any
reason whatsoever, cannot deliver possession of the New Space to Tenant
by July 1, 1996, the Lease (including this Amendment) shall not be void
or voidable, nor shall Landlord be liable to Tenant for any resulting
loss or damages resulting therefrom. However, if Landlord is unable to
complete the Tenant Improvements to be completed within the New Space
by July 1, 1996 due to delays other than delays caused by Tenant, then
the Expiration Date, as defined in this Amendment, with respect to both
the New Space and the Existing Premises, and the effective date for the
commencement of Base Rental with respect to the New Space set forth in
Paragraph 3(a) above, shall be postponed for a like period of time
equal to the number of days of such delay. No delay in delivery of
possession of the New Space or postponement of the Expansion Date shall
operate to relieve Tenant of Tenant's obligations to Landlord as
provided in the Lease, including, without limitation, the obligation to
pay Base Rental, except as hereinabove set forth. All Tenant
Improvements shall be constructed by Landlord's Contractor who shall be
selected by Landlord pursuant

2
<PAGE> 3
to a bid process whereby at least three (3) contractors selected by
Landlord will bid upon the work with Landlord selecting the successful
bidder. Landlord and Tenant agree to execute a Tenant Acceptance
Agreement, as described in Paragraph 2.5 of the Lease, setting forth
the Expansion Date and Expiration Date with respect to the New Space
within twenty (20) days after Tenant takes occupancy of the New Space.

(b) Landlord agrees to construct or install in the New
Space the "Tenant Improvements," as defined in and to be constructed or
installed pursuant to the provisions of the Tenant Improvement
Agreement which is attached hereto as Exhibit "B". Tenant agrees to
comply with all the terms and provisions of the Tenant Improvement
Agreement, including, without limitation, the obligation to pay, as
additional rent, all amounts due Landlord under Paragraph 3 thereof
according to the payment provisions contained in said Paragraph 3.

5. BROKER. Tenant represents and warrants to Landlord that no
broker, agent, commissioned salesman, or other person has represented Tenant in
the negotiations for and procurement of this Amendment and that no commissions,
fees, or compensation of any kind are due and payable in connection herewith to
any broker, agent, commissioned salesman, or other person. Tenant agrees to
indemnify and hold Landlord harmless from any and all claims, suits, or
judgments (including, without limitation, reasonable attorneys' fees and court
costs incurred in connection with any such claims, suits, or judgments) for any
fees, commissions or compensation or any kind which arise out of or are in any
way connected with any claimed agency relationship with Tenant. Landlord
represents and warrants to Tenant that no broker, agent, commissioned salesman,
or other person has represented Landlord in the negotiations for and procurement
of this Amendment and that no commissions, fees, or compensation of any kind are
due and payable in connection herewith to any broker, agent, commissioned
salesman or other person. Landlord agrees to indemnify and hold Tenant harmless
from any and all claims, suits or judgments (including, without limitation,
reasonable attorneys' fees and court costs incurred in connection with any such
claims, suits or judgments) for any fees, commissions, or compensation of any
kind which arise out of or are in any way connected with any claimed agency
relationship with Landlord.

6. MISCELLANEOUS. Except as expressly modified herein, the Lease
shall remain in full force and effect and Landlord and Tenant to hereby ratify
and confirm the terms and conditions of the Lease, as amended by this Amendment.
This Amendment shall be binding upon the executors, administrators, heirs,
successors and assigns of Landlord and Tenant, to the extent permitted under the
Lease.

3
<PAGE> 4
IN WITNESS WHEREOF, Landlord and Tenant have caused this Amendment to
be executed under seal by their duly authorized officers or representatives as
of the day and year first above written.

"TENANT"

E3 ASSOCIATES, LTD.

By: /s/ Frank K. Schuster
Print Name: Frank K. Schuster
Title: C.F.O./Exec. V.P.

Attest: /s/ Daniel J. Craddock
Print Name: Daniel J. Craddock
Title: President

(SEAL)

"LANDLORD"

TWO PARK, INC.

By: LaSalle Partners Management Limited,
Its authorized agent

By: /s/ Stephen P. Vale
Title: Vice President

(SEAL)

4
<PAGE> 5
EXHIBIT A

[DESCRIPTION OF PREMISES]

<PAGE> 6
EXHIBIT B

TENANT IMPROVEMENT AGREEMENT

WHEREAS, the undersigned Landlord and Tenant have executed, sealed and
delivered a certain Second Amendment to Lease Agreement to which this Agreement
is attached, and into which this Agreement is fully incorporated by reference,
as Exhibit B;

WHEREAS, said Amendment amends and modifies that certain Two Parkway
Center Lease Agreement between Landlord and Tenant dated November 8, 1990, as
amended by instrument dated August 14, 1995 (the "Lease"), which Lease, amended
as aforesaid, provides for the letting of space (the "Premises") within 1800
Parkway Place located at Two Parkway Center, Marietta, Georgia (the "Building");

WHEREAS, Landlord and Tenant desire to set forth herein their
respective agreements regarding the improvement of the Premises;

Section 1. Tenant Improvements.

Section 1.01 Definition.

The term "Tenant Improvements" shall mean all improvements constructed or
installed in or on the New Space in accordance with the Drawings and
Specifications, as hereinafter defined.

Section 1.02 Base Building Condition.

The term "Base Building Condition" shall mean the condition of the New Space
prior to commencement of the work of constructing and installing the Tenant
Improvements.

Section 2. Drawings and Specifications.

Section 2.01 Definition.

B-1
<PAGE> 7
(a) Tenant desires to use Landlord's Architect
to prepare final working drawings, specifications,
finish schedules, and the like necessary to commence
construction of the Tenant Improvements. As provided
in Section 3.01 hereof, the cost of preparing the
drawings, specifications, finish schedules and the
like as set forth in this Section 2.01 shall be paid
by Landlord and shall not be a part of Tenant's
Costs.

(b) On or before the fifth (5th) day following
receipt of the Drawings and Specifications, Landlord
shall obtain from Landlord's Contractor a price
schedule for the Tenant Improvements and shall submit
the same to Tenant for its approval. If Tenant
disapproves such price schedule, Tenant agrees to
work promptly with Landlord's Architect and
Landlord's Contractor to alter the Drawings and
Specifications as necessary to cause the price
quotation based thereon to be acceptable to Tenant.
The aggregate cost the Tenant Improvements, once
approved by Tenant, shall hereinafter be referred to
as "Tenant Improvement Costs." Upon determination of
the Tenant Improvement Costs, Tenant shall be deemed
to have given final approval to the Drawings and
Specifications and Landlord shall be deemed to have
been authorized to proceed, through Landlord's
Contractor, with the work of constructing and
installing the Tenant Improvements in accordance with
the Drawings and Specifications.

Section 3. Payment of Costs.

Section 3.01 Landlord's Costs for Preliminary Drawings.

Landlord shall bear the cost of preparing the drawings, specifications and
finish schedules in Section 2.01 above.

Section 3.02 Landlord's Allowance for Tenant Improvement Costs.

Landlord shall pay the Tenant Improvement Costs up to $10.50 per square foot of
Rentable Area in the New Space, or $39,102.00 based upon 3,724 square feet of
Rentable Area in the New Space ("Landlord's Allowance for Tenant Improvement
Costs"). The Landlord's Allowance for Tenant Improvement Costs must be expended
on permanent and semi-permanent finishes and improvements (not eligible are
items such as furniture, telecommunications and/or computer wiring or equipment,
moving expenses etc.). All improvements made from concrete slab to concrete deck
shall be deducted from this allowance. Tenant shall have no claim to the unused
portion of the Landlord's Allowance for Tenant Improvement Costs.

B-2
<PAGE> 8
Section 3.03 Tenant's Costs.

The aggregate of all costs described in the following subparagraphs (a) through
(c) of this Section 3.03 are hereinafter referred to collectively as "Tenant
Costs."

(a) The Tenant Improvement Costs over and above the
Landlord's Allowance for Tenant Improvement Costs;

(b) Fees for architects, engineers, interior designers,
and other professionals and design specialists incurred by Tenant in
connection with the Tenant Improvements; and

Section 3.04 Payment Schedule for Tenant's Costs.

Tenant shall pay to Landlord the Tenant's Costs as follows:

(a) Fifty percent (50%) of the amount of Tenant's Costs
then known to Landlord and Tenant shall be paid prior to the
commencement of any work of constructing and installing the Tenant
Improvements;

(b) Forty percent (40%) of the amount of Tenant's Costs
then known to Landlord and Tenant shall be paid within thirty (30)
calendar days after the commencement of the work of constructing and
installing the Tenant Improvements; and

(c) The balance of Tenant's Costs shall be paid
immediately upon Landlord's notification to Tenant that the work of
constructing and installing the Tenant Improvements has been
substantially completed.

Section 3.05 Changes in Drawings and Specifications.

B-3
<PAGE> 9
Drawings and Specifications adopted pursuant to the procedures of Section 2
above, as changed and modified pursuant to this Section 3.05, and all references
to "Tenant Improvement Costs" shall be deemed to include the aggregate approved
cost for the changes as determined in this Section 3.05. Once the changes and
the costs therefore have been approved, Tenant shall be deemed to have given
full authorization to Landlord to proceed with the work of constructing and
installing the Tenant Improvements in accordance with the Drawings and
Specifications, as changed and modified. Landlord, at its option, can require
Tenant to pay in lump sum to Landlord any and all increases in the Tenant
Improvement Costs which result from approved changes to the Drawings and
Specifications and which also result in the cost being above the Landlord's
Allowance for Tenant Improvement Costs. Any delays in completing the Tenant
Improvements which result from either changes in the Drawings and Specifications
made by Tenant or from the unavailability of materials specified by Tenant,
shall not operate to delay or extend the commencement date under the Lease nor
the payment of the base rental or other charges due under the Lease.

Section 3.06 Failure to Pay Tenant's Costs.

Failure by Tenant to pay Tenant's Costs in accordance with this Section 3 will
constitute a failure by Tenant to pay rent when due under the Lease and shall
therefore constitute an event of default by Tenant under the Lease, and Landlord
shall have all the remedies available to it under this Lease and at law or in
equity for nonpayment of rent.

Section 3.07 Landlord's Disbursement Obligations.

Landlord agrees to disburse the Landlord's Allowance for Tenant Improvement
Costs and the Tenant's Costs (to the extent deposited by Tenant with Landlord)
to pay the Tenant Improvement Costs as and when the same become due and payable.
Landlord shall be entitled to rely on the accuracy of any and all invoices and
fee statements for labor and materials performed on or furnished to the Premises
in connection with the Tenant Improvements and to rely, to the extent submitted,
on any and all certifications as to Tenant Improvement Costs submitted by
Landlord's Contractor and/or Landlord's Architect. Tenant does hereby release
and relieve Landlord from any claims for damages and the like which may result
from Landlord's paying an inaccurate invoice, fee statement, or the like and
does hereby indemnify and agree to hold Landlord harmless and to defend Landlord
from and against any and all claims, damages, liability, or costs (including,
without limitation, attorneys' fees and court costs) which may arise or result
from Landlord's payment of Tenant Improvement Costs or the nonpayment thereof.
Notwithstanding the foregoing, the within release and indemnification of
Landlord by Tenant shall not release any other third parties, nor shall it waive
any and all rights which Tenant may have against other third parties in
connection with the payment or nonpayment of Tenant Improvement Costs.

Section 4. Finish Work in Addition to Tenant Improvements.

B-4
<PAGE> 10
and installed by Tenant entirely at Tenant's expenses. Tenant shall adopt a
schedule for performing such additional work consistent with the schedule of
Landlord's Contractor and shall see that such work is conducted in such a manner
as to maintain harmonious labor relations and so as not to interfere
unreasonably with or to delay the work of constructing or installing the Tenant
Improvements. Landlord shall give access and entry to the Premises to Tenant and
its contract parties performing such additional work and reasonably opportunity
and time to enable Tenant and such contract parties to perform and complete such
work. All of such additional work and Tenant's use (and the use by its contract
parties) of the Premises for such purposes shall be entirely in accordance with
the Lease, including without limitation this Agreement.

Section 5. Time is of the Essence.

Time is of the essence of this Agreement. Unless specifically provided
otherwise, all references to days or months shall be construed as references to
calendar days or months, respectively.

[THIS SPACE INTENTIONALLY LEFT BLANK]

B-5
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement in duplicate, individually or through their respective authorized
officers, partners, agents or attorneys-in-fact, as the case may be, and sealed
this Agreement or caused their respective seals to be affixed hereto, the day
and year set forth below their respective executions, the latest of which is and
shall be deemed to be the date of this Agreement.

"TENANT"

E3 ASSOCIATES, LTD.

By: /s/ Frank K. Schuster
Print Name: Frank K. Schuster
Title: Exec. V.P./C.F.O.

Date: 4/18/96

Attest: /s/ Daniel J. Craddock
Print Name: Daniel J. Craddock
Title: President

Date: 4/18/96

(SEAL)

"LANDLORD"

TWO PARK, INC.

By: LaSalle Partners Management Limited,
Its authorized agent

By: /s/ Stephen P. Vale
Title: Vice President

Date: 4/22/96

B-6

<PAGE> 1
EXHIBIT 10.5

E3 CORPORATION

STOCK INCENTIVE PLAN

SECTION 1.
PURPOSE

The purpose of this Plan is to promote the interests of the Company by
providing the opportunity to purchase Shares or to receive compensation which is
based upon appreciation in the value of Shares to Employees and Key Persons in
order to attract and retain Employees and Key Persons by providing an incentive
to work to increase the value of Shares and a stake in the future of the Company
which corresponds to the stake of each of the Company's shareholders. The Plan
provides for the grant of Incentive Stock Options, Non-Qualified Stock Options,
Restricted Stock Awards and Stock Appreciation Rights to aid the Company in
obtaining these goals.

SECTION 2.
DEFINITIONS

Each term set forth in this Section shall have the meaning set forth
opposite such term for purposes of this Plan and, for purposes of such
definitions, the singular shall include the plural and the plural shall include
the singular, and reference to one gender shall include the other gender.

2.1 BOARD means the Board of Directors of the Company.

2.2 CODE means the Internal Revenue Code of 1986, as amended.

2.3 COMMITTEE means the Compensation Committee of the Board.

2.4 COMMON STOCK means the $.05 par value per share of common
stock of the Company.

2.5 COMPANY means E3 Corporation, a Georgia corporation, and any
successor to such organization.

2.6 EMPLOYEE means an employee of the Company, a Subsidiary or a
Parent.

2.7 EXCHANGE ACT means the Securities Exchange Act of 1934, as
amended.

2.8 EXERCISE PRICE means the price which shall be paid to purchase
one (1) Share upon the exercise of an Option granted under this Plan.

2.9 FAIR MARKET VALUE means the price at which the Committee,
acting in good faith, determines through any reasonable valuation method that a
Share might change hands between a willing buyer and a willing seller, neither
being under any compulsion to buy or to sell and both having reasonable
knowledge of the relevant facts.

2.10 ISO means an option granted under this Plan to purchase Shares
which is intended by the Company to satisfy the requirements of Code Section 422
as an incentive stock option.
<PAGE> 2
2.11 KEY PERSON means (i) a member of the Board who is not an
Employee, (ii) a consultant, distributor or other person who has rendered
valuable services to the Company, a Subsidiary or a Parent, (iii) a person who
has incurred, or is willing to incur, financial risk in the form of guaranteeing
or acting as co-obligor with respect to debts or other obligations of the
Company, or (iv) a person who has extended credit to the Company. Key Persons
are not limited to individuals and, subject to the preceding definition, may
include corporations, partnerships, associations and other entities.

2.12 NON-ISO means an option granted under this Plan to purchase
Shares which is not intended by the Company to satisfy the requirements of Code
Section 422.

2.13 OPTION means an ISO or a Non-ISO.

2.14 PARENT means any corporation which is a parent of the Company
(within the meaning of Code Section 424).

2.15 PARTICIPANT means an individual who receives a Stock Incentive
hereunder.

2.16 PLAN means the E3 Corporation Stock Incentive Plan, as amended
from time to time.

2.17 SHARE means a share of the Common Stock of the Company.

2.18 STOCK INCENTIVE means an ISO, a Non-ISO, a Restricted Stock
Award or a Stock Appreciation Right.

2.19 STOCK INCENTIVE AGREEMENT means an agreement between the
Company and a Participant evidencing an award of a Stock Incentive, including
without limitation a Stock Option Grant Certificate.

2.20 STOCK OPTION GRANT CERTIFICATE means a Stock Incentive
Agreement between the Company and a Participant evidencing an award of an
Option.

2.21 SUBSIDIARY means any corporation which is a subsidiary of the
Company (within the meaning of Code Section 424(f)).

2.22 SURRENDERED SHARES means the Shares described in Section 8.2
which (in lieu of being purchased) are surrendered for cash or Shares, or for a
combination of cash and Shares, in accordance with Section 8.

2.23 TEN PERCENT SHAREHOLDER means a person who owns (after taking
into account the attribution rules of Code Section 424(d)) more than ten percent
(10%) of the total combined voting power of all classes of shares of either the
Company, a Subsidiary or a Parent.

SECTION 3.
SHARES SUBJECT TO STOCK INCENTIVES

The total number of Shares that may be issued pursuant to Stock
Incentives under this Plan shall not exceed Three Million (3,000,000), as
adjusted pursuant to Section 11. Such Shares shall be reserved, to the extent
that the Company deems appropriate, from authorized but unissued Shares, and
from Shares which have been reacquired by the Company. Furthermore, any Shares
subject to a Stock Incentive which remain after the cancellation, expiration or
exchange of such Stock Incentive thereafter shall again become available for use
under this Plan, but any Surrendered Shares which remain after the surrender of
an ISO or a Non-ISO under Section 8 shall not again become available for use
under this Plan.

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<PAGE> 3
SECTION 4.
EFFECTIVE DATE

The effective date of this Plan shall be the date it is adopted by the
Board, provided the shareholders of the Company approve this Plan within twelve
(12) months after such effective date. If such effective date comes before such
shareholder approval, any Stock Incentives granted under this Plan before the
date of such approval automatically shall be granted subject to such approval.

SECTION 5.
ADMINISTRATION

This Plan shall be administered by the Board. The Board, acting in its
absolute discretion, shall exercise such powers and take such action as
expressly called for under this Plan. The Board shall have the power to
interpret this Plan and, subject to Section 13 to take such other action in the
administration and operation of the Plan as it deems equitable under the
circumstances. The Board's actions shall be binding on the Company, on each
affected Employee or Key Person, and on each other person directly or indirectly
affected by such actions.

The Board may delegate its authority under the Plan, in whole or in
part, to a Committee appointed by the Board consisting of not less than two (2)
directors, each of whom does not while a member of the Committee, or has not
during the one (1) year prior to serving as a member of the Committee, received
equity securities of the Company, Parent or Subsidiary, pursuant to this Plan or
any other plan of the Company, Parent or Subsidiary, except as may be permitted
under Section 16(b)(3) of the Exchange Act. The Committee (if appointed) shall
act according to the policies and procedures set forth in the Plan and to those
policies and procedures established by the Board, and the Committee shall have
such powers and responsibilities as are set forth by the Board. Reference to the
Board in this Plan shall specifically include reference to the Committee where
the Board has delegated it authority to the Committee, and any action by the
Committee pursuant to a delegation of authority by the Board shall be deemed an
action by the Board under the Plan. Notwithstanding the above, the Board may
assume the powers and responsibilities granted to the Committee at any time, in
whole or in part.

SECTION 6.
ELIGIBILITY

Except as provided below, only Employees shall be eligible for the
grant of Stock Incentives under this Plan, but no Employee shall have the right
to be granted a Stock Incentive under this Plan merely as a result of his or her
status as an Employee. Key Persons may be eligible, subject to written approval
by the Board, for the grant of Stock Incentives under this Plan, but only if the
Key Person has provided valuable services to the Company, a Subsidiary or a
Parent, and only if the Stock Incentive is not an ISO.

SECTION 7
TERMS OF STOCK INCENTIVES

7.1 TERMS AND CONDITIONS OF ALL STOCK INCENTIVES.

(a) The Committee, in its absolute discretion, shall
grant Stock Incentives under this Plan from time to time and shall have the
right to grant new Stock Incentives in exchange for outstanding Stock
Incentives. Stock Incentives shall be granted to Employees or Key Persons
selected by the Committee, and the Committee shall be under no obligation
whatsoever to grant Stock Incentives to all Employees or Key Persons, or to
grant all Stock Incentives subject to the same terms and conditions. Each grant
of a Stock Incentive shall be evidenced by a Stock Incentive Agreement.:

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<PAGE> 4
(b) The number of Shares as to which a Stock Incentive
shall be granted shall be determined by the Committee in its sole discretion,
subject to the provisions of Section 3 as to the total number of shares
available for grants under the Plan.

(c) Each Stock Incentive shall be evidenced by a Stock
Incentive Agreement executed by the Company and the Participant, which shall be
in such form and contain such terms and conditions as the Committee in its
discretion may, subject to the provisions of the Plan, from time to time
determine.

(d) The date a Stock Incentive is granted shall be the
date on which the Committee has approved the terms and conditions of the Stock
Incentive Agreement and has determined the recipient of the Stock Incentive and
the number of Shares covered by the Stock Incentive and has taken all such other
action necessary to complete the grant of the Stock Incentive.

7.2 TERMS AND CONDITIONS OF OPTIONS. Each grant of an Option shall
be evidenced by a Stock Option Grant Certificate which shall:

(I) specify whether the Option is an ISO or Non-ISO; and

(II) incorporate such other terms and conditions as the
Committee, acting in its absolute discretion, deems consistent with the terms of
this Plan, including (without limitation) a restriction on the number of Shares
subject to the Option which first become exercisable or subject to surrender
during any calendar year.

In determining Employee(s) or Key Person(s) to whom an Option
shall be granted and the number of Shares to be covered by such Option, the
Committee may take into account the recommendations of the President of the
Company and its other officers, the duties of the Employee or Key Person, the
present and potential contributions of the Employee or Key Person to the success
of the Company, the anticipated number of years of service remaining before the
attainment by the Employee of retirement age, and other factors deemed relevant
by the Committee, in its sole discretion, in connection with accomplishing the
purpose of this Plan. An Employee or Key Person who has been granted an Option
to purchase Shares, whether under this Plan or otherwise, may be granted one or
more additional Options.

If the Committee grants an ISO and a Non-ISO to an Employee on
the same date, the right of the Employee to exercise or surrender one such
Option shall not be conditioned on his or her failure to exercise or surrender
the other such Option.

(a) Exercise Price. Subject to adjustment in accordance
with Section 11 and the other provisions of this Section, the Exercise Price
shall be as set forth in the applicable Stock Option Grant Certificate. With
respect to each grant of an ISO to a Participant who is not a Ten Percent
Shareholder, the Exercise Price shall not be less than the Fair Market Value on
the date the ISO is granted. With respect to each grant of an ISO to a
Participant who is a Ten Percent Shareholder, a Ten Percent Shareholder shall
not be less than one hundred ten percent (110%) of the Fair Market Value on the
date the ISO is granted. If a Stock Incentive is a Non-ISO, the Exercise Price
for each Share shall be no less than the minimum price required by applicable
state law, or by the Company's governing instrument, or $0.01, whichever price
is greater.

(b) Option Term. Each Option granted under this Plan
shall be exercisable in whole or in part at such time or times as set forth in
the related Stock Option Grant Certificate, but no Stock Option Grant
Certificate shall:

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<PAGE> 5
(i) make an Option exercisable before the date
such Option is granted; or

(ii) make an Option exercisable after the earlier
of the:

(A) the date such Option is exercised
in full, or

(B) the date which is the tenth (10th)
anniversary of the date such Option is granted, if such Option is a Non-ISO or
an ISO granted to a non-Ten Percent Shareholder, or the date which is the fifth
(5th) anniversary of the date such Option is granted, if such Option is an ISO
granted to a Ten Percent Shareholder.

A Stock Option Grant Certificate may provide for the exercise
of an Option after the employment of an Employee has terminated for any reason
whatsoever, including death or disability.

(c) Payment. Payment for all shares of Stock purchased
pursuant to exercise of an Option shall be made in cash or, if the Stock Option
Grant Certificate provides, by delivery to the Company of a number of Shares
which have been owned by the holder for at least six (6) months prior to the
date of exercise having an aggregate Fair Market Value of not less than the
product of the Exercise Price multiplied by the number of Shares the Participant
intends to purchase upon exercise of the Option on the date of delivery. In
addition, the Stock Option Grant Certificate may provide for cashless exercise
through a brokerage transaction following registration of the Company's equity
securities under Section 12 of the Securities Exchange Act of 1934. Except as
provided in subparagraph (f) below, payment shall be made at the time that the
Option or any part thereof is exercised, and no Shares shall be issued or
delivered upon exercise of an Option until full payment has been made by the
Participant. The holder of an Option, as such, shall have none of the rights of
a stockholder.

Notwithstanding the above, and in the sole discretion of the
Committee, an Option may be exercised as to a portion or all (as determined by
the Committee) of the number of Shares specified in the Stock Option Grant
Certificate by delivery to the Company of a promissory note, such promissory
note to be executed by the Participant and which shall include, with such other
terms and conditions as the Committee shall determine, provisions in a form
approved by the Committee under which: (i) the balance of the aggregate purchase
price shall be payable in equal installments over such period and shall bear
interest at such rate (which shall not be less than the prime bank loan rate as
determined by the Committee) as the Committee shall approve, and (ii) the
Participant shall be personally liable for payment of the unpaid principal
balance and all accrued but unpaid interest.

(d) Conditions to Exercise of an Option. Each Option
granted under the Plan shall be exercisable at such time or times, or upon the
occurrence of such event or events, and in such amounts, as the Committee shall
specify in the Stock Option Grant Certificate; provided, however, that
subsequent to the grant of an Option, the Committee, at any time before complete
termination of such Option, may accelerate the time or times at which such
Option may be exercised in whole or in part.

(e) Nontransferability of Options. Except as provided in
subparagraph (f) below, an Option shall not be transferable or assignable except
by will or by the laws of descent and distribution and shall be exercisable,
during the Participant's lifetime, only by the Participant, or in the event of
the disability of the Participant, by the legal representative of the
Participant.

(f) Special Provisions for Certain Substitute Options.
Notwithstanding anything to the contrary in this Section, any Option in
substitution for a stock option previously issued by another entity, which
substitution occurs in connection with a transaction to which Code Section
424(a) is applicable, may

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<PAGE> 6
provide for an exercise price computed in accordance with such Code Section and
the regulations thereunder and may contain such other terms and conditions as
the Committee may prescribe to cause such substitute Option to contain as nearly
as possible the same terms and conditions (including the applicable vesting and
termination provisions) as those contained in the previously issued stock option
being replaced thereby.

7.3 TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS. A Stock
Appreciation Right may be granted in connection with all or any portion of a
previously or contemporaneously granted Option or not in connection with an
Option. A Stock Appreciation Right shall entitle the Participant to receive upon
exercise or payment the excess of: (I) the Fair Market Value of a specified
number of Shares at the time of exercise, over (II) a specified price which
shall be not less than the Exercise Price for that number of Shares in the case
of a Stock Appreciation Right granted in connection with a previously or
contemporaneously granted Option, or in the case of any other Stock Appreciation
Right not less than one hundred percent (100%) of the Fair Market Value of that
number of Shares at the time the Stock Appreciation Right was granted. A Stock
Appreciation Right granted in connection with an Option may only be exercised to
the extent that the related Option has not been exercised. The exercise of a
Stock Appreciation Right shall result in a pro rata surrender of the related
Option to the extent the Stock Appreciation Right has been exercised.

(a) Payment. Upon exercise or payment of a Stock
Appreciation Right, the Company shall pay to the Participant the appreciation in
cash or Shares (at the aggregate Fair Market Value on the date of payment or
exercise) as provided in the Stock Incentive Agreement or, in the absence of
such provision, as the Committee may determine.

(b) Conditions to Exercise. Each Stock Appreciation Right
granted under the Plan shall be exercisable at such time or times, or upon the
occurrence of such event or events, and in such amounts, as the Committee shall
specify in the Stock Incentive Agreement; provided, however, that subsequent to
the grant of a Stock Appreciation Right, the Committee, at any time before
complete termination of such Stock Appreciation Right, may accelerate the time
or times at which such Stock Appreciation Right may be exercised in whole or in
part.

(c) Nontransferability of Stock Appreciation Right. A
Stock Appreciation Right shall not be transferable or assignable except by will
or by the laws of descent and distribution and shall be exercisable, during the
Participant's lifetime, only by the Participant, or in the event of the
disability of the Participant, by the legal representative of the Participant.

7.4 TERMS AND CONDITIONS OF RESTRICTED STOCK AWARDS. Shares
awarded pursuant to Restricted Stock Awards shall be subject to restrictions for
periods determined by the Committee. The Committee shall have the power to
permit, in its discretion, an acceleration of the expiration of the applicable
restriction period with respect to any part or all of the Shares awarded to a
Participant. The Committee may require a cash payment from the Participant in an
amount no greater than the aggregate Fair Market Value of the Shares awarded
determined at the date of grant in exchange for the grant of a Restricted Stock
Award or may grant a Restricted Stock Award without the requirement of a cash
payment.

SECTION 8.
SURRENDER OF OPTIONS

8.1 GENERAL RULE. The Committee, acting in its absolute
discretion, may incorporate a provision in a Stock Incentive Agreement to allow
an Employee or Key Person to surrender his or her Option in whole or in part in
lieu of the exercise in whole or in part of that Option on any date that:

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<PAGE> 7
(a) the Fair Market Value of the Shares subject to such
Option exceeds Exercise Price for such Shares, and

(b) the Option to purchase such Shares is otherwise
exercisable.

8.2 PROCEDURE. The surrender of an Option in whole or in part
shall be effected by the delivery of the Stock Incentive Agreement to the
Committee, together with a statement signed by the Participant which specifies
the number of Shares ("Surrendered Shares") as to which the Participant
surrenders his or her Option and how he or she desires payment be made for such
Surrendered Shares.

8.3 PAYMENT. A Participant in exchange for his or her Surrendered
Shares shall receive a payment in cash or in Shares, or in a combination of cash
and Shares, equal in amount on the date such surrender is effected to the excess
of the Fair Market Value of the Surrendered Shares on such date over the
Exercise Price for the Surrendered Shares. The Committee, acting in its absolute
discretion, can approve or disapprove a Participant's request for payment in
whole or in part in cash and can make that payment in cash or in such
combination of cash and Shares as the Committee deems appropriate. A request for
payment only in Shares shall be approved and made in Shares to the extent
payment can be made in whole shares of Shares and (at the Committee's
discretion) in cash in lieu of any fractional Shares.

8.4 RESTRICTIONS. Any Stock Incentive Agreement which incorporates
a provision to allow a Participant to surrender his or her Option in whole or in
part also shall incorporate such additional restrictions on the exercise or
surrender of such Option as the Committee deems necessary to satisfy the
conditions to the exemption under Rule 16b-3 (or any successor exemption) to
Section 16(b) of the Exchange Act.

SECTION 9.
SECURITIES REGULATION

Each Stock Incentive Agreement may provide that, upon the receipt of
Shares as a result of the surrender or exercise of a Stock Incentive, the
Participant shall, if so requested by the Company, hold such Shares for
investment and not with a view of resale or distribution to the public and, if
so requested by the Company, shall deliver to the Company a written statement
satisfactory to the Company to that effect. Each Stock Incentive Agreement may
also provide that, if so requested by the Company, the Participant shall make a
written representation to the Company that he or she will not sell or offer to
sell any of such Shares unless a registration statement shall be in effect with
respect to such Shares under the Securities Act of 1933, as amended ("1933
Act"), and any applicable state securities law or, unless he or she shall have
furnished to the Company an opinion, in form and substance satisfactory to the
Company, of legal counsel acceptable to the Company, that such registration is
not required. Certificates representing the Shares transferred upon the exercise
or surrender of a Stock Incentive granted under this Plan may at the discretion
of the Company bear a legend to the effect that such Shares have not been
registered under the 1933 Act or any applicable state securities law and that
such Shares may not be sold or offered for sale in the absence of an effective
registration statement as to such Shares under the 1933 Act and any applicable
state securities law or an opinion, in form and substance satisfactory to the
Company, of legal counsel acceptable to the Company, that such registration is
not required.

SECTION 10.
LIFE OF PLAN

No Stock Incentive shall be granted under this Plan on or after the
earlier of:

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<PAGE> 8
(a) the tenth (10th) anniversary of the effective date of this
Plan (as determined under Section 4 of this Plan), in which event this Plan
otherwise thereafter shall continue in effect until all outstanding Stock
Incentives have been surrendered or exercised in full or no longer are
exercisable, or

(b) the date on which all of the Shares reserved under Section 3
of this Plan have (as a result of the surrender or exercise of Stock Incentives
granted under this Plan) been issued or no longer are available for use under
this Plan, in which event this Plan also shall terminate on such date.

SECTION 11.
ADJUSTMENT

The number of Shares reserved under Section 3 of this Plan, and the
number of Shares subject to Stock Incentives granted under this Plan, and the
Exercise Price of any Options, shall be adjusted by the Committee in an
equitable manner to reflect any change in the capitalization of the Company,
including, but not limited to, such changes as stock dividends or stock splits.
Furthermore, the Committee shall have the right to adjust (in a manner which
satisfies the requirements of Code Section 424(a)) the number of Shares reserved
under Section 3, and the number of Shares subject to Stock Incentives granted
under this Plan, and the Exercise Price of any Options in the event of any
corporate transaction described in Code Section 424(a) which provides for the
substitution or assumption of such Stock Incentives. If any adjustment under
this Section creates a fractional Share or a right to acquire a fractional
Share, such fractional Share shall be disregarded, and the number of Shares
reserved under this Plan and the number subject to any Stock Incentives granted
under this Plan shall be the next lower number of Shares, rounding all fractions
downward. An adjustment made under this Section by the Committee shall be
conclusive and binding on all affected persons and, further, shall not
constitute an increase in the number of Shares reserved under Section 3.

SECTION 12.
SALE OR MERGER OF THE COMPANY

(a) Except as provided in subsection (b) of this Plan or except as
may be provided in any particular Stock Option Grant Certificate, if the Company
agrees to sell substantially all of its assets for cash or property, or for a
combination of cash and property, or agrees to any merger, consolidation,
reorganization, division or other transaction in which Shares are converted into
another security or into the right to receive securities or property and such
agreement does not provide for the assumption or substitution of the Options
granted under this Plan, each Option at the direction and discretion of the
Committee may be (i) declared by the Company to be fully vested and immediately
exercisable or (ii) canceled unilaterally by the Company in exchange for (x) the
whole Shares (or, subject to satisfying the conditions to the exemption under
Rule 16b-3 or any successor exemption to Section 16(b) of the Exchange Act, for
the whole Shares and the cash in lieu of a fractional Share) which each
Participant otherwise would receive if he or she had the right to exercise his
or her outstanding Option in full and he or she exercised that right exclusively
for Shares on a date fixed by the Committee which comes before such sale or
other corporate transaction, or (y) cash, securities or other property having a
fair market value equal to the difference between the fair market value of the
Shares subject to the Option and the aggregate exercise price, with the
Committee retaining the authority to determine whether payment under this part
(y) shall be made with respect only to the vested portion of Options or with
respect to both the vested and unvested portions of Options.

(b) In the event of a merger in which the Company is not the
surviving corporation and the only principal consideration exchanged is stock,
notwithstanding the provisions of subsection (a), each Option granted under this
Plan shall become fully vested and immediately exercisable.

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<PAGE> 9
SECTION 13.
AMENDMENT OR TERMINATION

This Plan may be amended by the Board from time to time to the extent
that the Board deems necessary or appropriate; provided, however, no such
amendment shall be made absent the approval of the shareholders of the Company:
(a) to increase the number of Shares reserved under Section 3, except as set
forth in Section 11, (b) to extend the maximum life of the Plan under Section 10
or the maximum exercise period under Section 7, (c) to decrease the minimum
Exercise Price under Section 7, or (d) to change the designation of Employees or
Key Persons eligible for Stock Incentives under Section 6. The Board also may
suspend the granting of Stock Incentives under this Plan at any time and may
terminate this Plan at any time; provided, however, the Company shall not have
the right to modify, amend or cancel any Stock Incentive granted before such
suspension or termination unless: (I) the Participant consents in writing to
such modification, amendment or cancellation, or (II) there is a dissolution or
liquidation of the Company or a transaction described in Section 11 or Section
12.

SECTION 14.
MISCELLANEOUS

14.1 SHAREHOLDER RIGHTS. No Participant shall have any rights as a
shareholder of the Company as a result of the grant of a Stock Incentive to him
or to her under this Plan or his or her exercise or surrender of such Stock
Incentive pending the actual delivery of Shares subject to such Stock Incentive
to such Participant.

14.2 NO GUARANTEE OF CONTINUED RELATIONSHIP. The grant of a Stock
Incentive to a Participant under this Plan shall not constitute a contract of
employment and shall not confer on a Participant any rights upon his or her
termination of employment or relationship with the Company in addition to those
rights, if any, expressly set forth in the Stock Incentive Agreement which
evidences his or her Stock Incentive.

14.3 WITHHOLDING. The exercise or surrender of any Stock Incentive
granted under this Plan shall constitute a Participant's full and complete
consent to whatever action the Committee directs to satisfy the federal and
state tax withholding requirements, if any, which the Committee in its
discretion deems applicable to such exercise or surrender.

14.4 TRANSFER. The transfer of an Employee between or among the
Company, a Subsidiary or a Parent shall not be treated as a termination of his
or her employment under this Plan.

14.5 CONSTRUCTION. This Plan shall be construed under the laws of
the State of Georgia.

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<PAGE> 1
EXHIBIT 10.6

E3 CORPORATION

STOCK INCENTIVE PLAN
STOCK OPTION GRANT CERTIFICATE

E3 Corporation, a Georgia corporation (the "Company"), hereby grants to
the optionee named below ("Optionee") an option (this "Option") to purchase the
total number of shares shown below of Common Stock of the Company (the "Shares")
at the exercise price per share set forth below (the "Exercise Price"), subject
to all of the terms and conditions on the reverse side of this Stock Option
Grant Certificate and the E3 Corporation Stock Incentive Plan (the "Plan").
Unless otherwise defined herein, capitalized terms used herein shall have the
meanings ascribed to them in the Plan. The terms and conditions set forth on the
reverse side hereof and the terms and conditions of the Plan are incorporated
herein by reference.

IN WITNESS WHEREOF, this Stock Option Grant Certificate has been
executed by the Company by a duly authorized officer as of the date specified
hereon.

E3 Corporation

By:___________________________

Date of Grant:

Type of Stock Option:

Non-Qualified

Shares Subject to Option:

Exercise Price Per Share:

Term of Option:

Shares subject to issuance under this Option shall be eligible for exercise
according to the vesting schedule selected below and further described in
Section 10 on the reverse of this Stock Option Grant Certificate.

Four Year Vesting

Optionee hereby acknowledges receipt of a copy of the Plan, represents
that Optionee has read and understands the terms and provisions of the Plan, and
accepts this Option subject to all the terms and conditions of the Plan and this
Stock Option Grant Certificate. Optionee acknowledges that there may be adverse
tax consequences upon exercise of this Option or disposition of the Shares and
that Optionee should consult a tax adviser prior to such exercise or
disposition.

________________________________________________________________________________
Signature of Optionee

________________________________________________________________________________
Print Name of Optionee

<PAGE> 2
1. EXERCISE PERIOD OF OPTION. Subject to the terms and conditions
of this Option and the Plan, and unless otherwise modified by a written
modification signed by the Company and Optionee, this Option may be exercised
with respect to all of the Shares, but only according to the vesting schedule
selected on the reverse of this Stock Option Grant Certificate and as described
in Section 10 below, prior to the date which is the last day of the term set
forth on the face hereof following the date of grant (hereinafter "Expiration
Date").

2. RESTRICTIONS ON EXERCISE. This Option may not be exercised,
unless such exercise is in compliance with the Securities Act of 1933 and all
applicable state securities laws, as they are in effect on the date of exercise,
and the requirements of any stock exchange or national market system on which
the Company's Common Stock may be listed at the time of exercise. Optionee
understands that the Company is under no obligation to register, qualify or list
the Shares with the Securities and Exchange Commission ("SEC"), any state
securities commission or any stock exchange to effect such compliance.

3. TERMINATION OF OPTION. Except as provided below in this
Section, this Option may not be exercised after the date which is ninety (90)
days after Optionee ceases to perform services for the Company, or any Parent or
Subsidiary. Optionee shall be considered to perform services for the Company, or
any Parent or Subsidiary, for all purposes under this Section and Section 10
hereof, if Optionee is an officer or full-time employee of the Company, or any
Parent or Subsidiary, or if the Board determines that Optionee is rendering
substantial services as a part-time employee, consultant, contractor or advisor
to the Company, or any Parent or Subsidiary. The Board shall have discretion to
determine whether Optionee has ceased to perform services for the Company, or
any Parent or Subsidiary, and the effective date on which such services cease
(the "Termination Date"). Notwithstanding anything contained herein to the
contrary, if the corporate position of Optionee is, at any time, altered or
revised such that Optionee's responsibilities are materially reduced or
decreased for any reason, as determined by the Board in its sole discretion, the
vesting of Shares under Section 10 shall cease, effective as of the date of such
reduction in Optionee's employment responsibilities; provided, however, except
as otherwise provided in this Option and the Plan, Optionee shall have the right
to exercise this Option with respect to Shares which have vested under Section
10 as of the date of such reduction of Optionee's responsibilities.

(a) Termination Generally. If Optionee ceases to perform
services for the Company, or any Parent or Subsidiary, for any reason, except
death or disability (within the meaning of Code Section 22(e)(3)), this Option
shall immediately be forfeited, along with any and all rights or subsequent
rights attached thereto, ninety (90) days following the Termination Date, but in
no event later than the Expiration Date; provided however, that this Option
shall be forfeited immediately in the event and upon Optionee violating any
noncompetition, nonsolicitation, nondisclosure or other similar agreement.

(b) Termination for Cause. This Option shall immediately
terminate and be forfeited in the event the Optionee's employment is terminated
by the Company, or any Parent or Subsidiary, for any of the following reasons
("Cause"): (i) conduct of Optionee amounting to fraud, dishonesty, willful
misconduct or acts of moral turpitude inconsistent with the best interests of
the Company or (ii) Optionee's unauthorized disclosure of any trade secrets or
confidential or proprietary information of the Company.

(c) Death or Disability. If Optionee ceases to perform
services for the Company, or any Parent or Subsidiary, as a result of the death
or disability of Optionee (as determined by the Board in its sole discretion),
this Option, to the extent (and only to the extent) that it would have been
exercisable by Optionee on the Termination Date, may be exercised by Optionee
(or, in the event of Optionee's death, by Optionee's legal representative)
within ninety (90) days after the Termination Date, but in no event later than
the Expiration Date.

(d) No Right to Employment. Nothing in the Plan or this
Stock Option Grant Certificate shall confer on Optionee any right to continue in
the employ of, or other relationship with, the Company, or any Parent or
Subsidiary, or limit in any way the right of the Company, or any Parent or
Subsidiary, to terminate Optionee's employment or other relationship at any
time, with or without cause.

4. MANNER OF EXERCISE.

(a) Exercise Agreement. This Option shall be exercisable
by delivery to the Company of an executed Exercise and Shareholder Agreement
("Exercise Agreement") in the form of the Exercise Agreement delivered to
Optionee, if applicable, or in such other form as may be approved or accepted by
the Company, which shall set forth Optionee's election to exercise this Option
with respect to some or all of the Shares, the number of Shares being purchased,
any restrictions imposed on the Shares, and such other representations and
agreements as may be required by the Company to comply with applicable
securities laws.

(b) Exercise Price. Such notice shall be accompanied by
full payment of the Exercise Price for the Shares being purchased. Payment for
the Shares may be made in U.S. dollars in cash (by check) or, where permitted by
law and approved by the Board or Committee in its sole discretion: (i) by
cancellation of indebtedness of the Company to Optionee; (ii) by surrender of
shares of Common Stock of the Company that have been owned by Optionee for more
than six (6) months (and which have been paid for within the meaning of SEC Rule
144, and, if such shares were purchased from the Company by use of a promissory
note, such note has been fully paid with respect to such shares), or were
obtained by Optionee in the open public market, having a Fair Market Value equal
to the Exercise Price of the Shares being purchased; (iii) by instructing the
Company to withhold Shares otherwise issuable pursuant to the exercise of the
Option having a Fair Market Value equal to the Exercise Price of the Shares
being purchased (including the withheld Shares); (iv) by waiver of compensation
accrued by Optionee for services rendered; (v) by delivery to the Company of a
promissory note executed by Optionee which shall include such terms and
conditions as the Board shall approve in accordance with the terms and
conditions of the Plan; or (vi) a combination of the foregoing as approved by
the Board.

(c) Withholding Taxes. Prior to the issuance of Shares
upon exercise of this Option, Optionee must pay, or make adequate provision for,
any applicable federal or state withholding obligations of the Company. Where
approved by the Board, Optionee may provide for payment of withholding taxes
upon exercise of the Option by requesting that the Company retain Shares with a
Fair Market Value equal to the minimum amount of taxes required to be withheld.
In such case, the Company shall issue the net number of Shares to Optionee by
deducting the Shares retained from the Shares exercised.

(d) Issuance of Shares. Provided that such notice and
payment are in form and substance satisfactory to counsel for the Company, the
Company shall cause the Shares to be issued in the name of Optionee or
Optionee's legal representative.

5. NOTICE OF DISQUALIFYING DISPOSITION OF ISO SHARES. If this
Option is an ISO, and if Optionee sells or otherwise disposes of any of the
Shares acquired pursuant to the ISO on or before the later of: (a) the date two
(2) years after the Date of Grant, or (b) the date one (1) year after exercise
of the ISO, with respect to the Shares to be sold or disposed, Optionee shall
immediately notify the Company in writing of such sale or disposition. Optionee
acknowledges and agrees that Optionee may be subject to income tax withholding
by the Company on the compensation income recognized by Optionee from any such
early disposition by payment in cash or out of the current wages or earnings
payable to Optionee.

6. NONTRANSFERABILITY OF OPTION. This Option may not be
transferred in any manner, other than by will or by the laws of descent and
distribution, and may be exercised during Optionee's lifetime only by Optionee.
The terms of this Option shall be binding upon the executor, administrators,
successors and assigns of Optionee.

7. TAX CONSEQUENCES. OPTIONEE UNDERSTANDS THAT THE GRANT AND
EXERCISE OF THIS OPTION, AND THE SALE OF SHARES OBTAINED THROUGH THE EXERCISE OF
THIS OPTION, MAY HAVE TAX IMPLICATIONS THAT COULD RESULT IN ADVERSE TAX
CONSEQUENCES TO OPTIONEE. OPTIONEE REPRESENTS THAT OPTIONEE HAS CONSULTED WITH,
OR WILL CONSULT WITH, HIS OR HER TAX ADVISOR AND OPTIONEE FURTHER ACKNOWLEDGES
THAT OPTIONEE IS NOT RELYING ON THE COMPANY FOR ANY FINANCIAL, TAX OR OTHER
ADVICE.

8. INTERPRETATION. Any dispute regarding the interpretation of
this Stock Option Grant Certificate shall be submitted by Optionee or the
Company to the Board or Committee which shall review such dispute at its next
regular meeting. The resolution of such a dispute by the Board or Committee
shall be final and binding on the Company and Optionee.

9. ENTIRE AGREEMENT. The Plan and the Exercise Agreement are
incorporated herein by this reference. Optionee acknowledges and agrees that the
granting of this Option constitutes a full accord, satisfaction and release of
all obligations or commitments made to Optionee by the Company or any of its
officers, directors, shareholders or affiliates with respect to the issuance of
any securities, or rights to acquire securities, of the Company or any of its
affiliates. This Stock Option Grant Certificate, the Plan and the Exercise
Agreement constitute the entire agreement of the parties hereto, and supersede
all prior undertakings and agreements with respect to the subject matter hereof.

10. VESTING AND EXERCISE OF SHARES. Subject to the terms of the
Plan, this Stock Option Grant Certificate, the Exercise Agreement and Section 11
hereof, the issuance of Shares pursuant to the exercise of this Option shall be
subject to the vesting restrictions selected on the reverse side of this Stock
Option Grant Certificate and defined below. For purposes of this Section,
"Continuous Service" means a period of continuous performance of services by
Optionee for the Company, a Parent, or a Subsidiary, as determined by the Board.

Four Year Vesting: Optionee may exercise this Option with respect to
the percentage of Shares set forth below only after Optionee has
completed the following periods of Continuous Service following the
date of grant:
(a) After twenty-four (24) months of Continuous Service,
up to forty percent (40%) of the Shares:
(b) After thirty-six (36) months of Continuous Service,
up to seventy percent (70%) of the Shares: and
(c) After forty-eight (48) months of Continuous Service,
up to one hundred percent (100%) of the Shares.

11. VESTING AND EXERCISE OF SHARES UPON A CHANGE IN CONTROL. In
the event that Optionee's employment is terminated by the Company other than for
Cause within one (1) year following a "Change in Control," then the Option shall
become fully vested and immediately exercisable upon such termination of
employment. A "Change in Control" means (i) any transaction (which shall include
a series of transactions occurring within 60 days or occurring pursuant to a
plan) which has the result that shareholders of the Company immediately before
such transaction cease to own at least a majority of the voting stock of the
Company or of any entity which results from the participation of the Company in
a reorganization, consolidation, merger, liquidation or any other form of
corporate transaction, (ii) a merger, consolidation, reorganization, liquidation
or dissolution in which the Company does not survive, or (iii) a sale, lease,
exchange or other disposition of all or substantially all of the property and
assets of the Company.

<PAGE> 1
EXHIBIT 10.7

ADOPTION AGREEMENT FOR

WHEAT FIRST BUTCHER SINGER
NON-STANDARDIZED 401(K) PROFIT SHARING
PLAN AND TRUST

The undersigned Employer adopts the Wheat First Butcher Singer
Non-Standardized 401(k) Profit Sharing Plan and Trust for those Employees who
shall qualify as Participants hereunder, to be known as the

Al E3 Associates, Ltd. 401(k) Employee Savings Plan
---------------------------------------------------------------------------
(Enter Plan Name)

It shall be effective as of the date specified below. The Employer hereby
selects the following Plan specifications:

CAUTION: The failure to properly fill out this Adoption Agreement may result in
disqualification of the Plan.

EMPLOYER INFORMATION

B1 Name of Employer E3 Associates, Ltd.
----------------------------------------------------

B2 Address 1800 Parkway Place, Suite 600
----------------------------------------------------
Marietta, GA 30067
----------------------------------------------------
City State Zip

Telephone 770-424-0100
----------------------------------------------------

B3 Employer Identification Number 58-2013108
-----------------------------------

B4 Date Business Commenced December 1980
----------------------------------------
B5 TYPE OF ENTITY
a. ( ) S Corporation
b. ( ) Professional Service Corporation
c. (X) Corporation
d. ( ) Sole Proprietorship
e. ( ) Partnership
f. ( ) Other

AND, is the Employer a member of...

g. a controlled group? (X) Yes ( ) No
h. an affiliated service group? ( ) Yes (X) No

<PAGE> 2

B6 NAME(S) OF TRUSTEE(S)

a. Frank K. Schuster
-----------------------------------------------------------------
b. Anders H. Herlitz
-----------------------------------------------------------------
c. William H. Huther
-----------------------------------------------------------------
d.
-----------------------------------------------------------------
e.
-----------------------------------------------------------------

B7 TRUSTEES' ADDRESS

a. (X) Use Employer Address

b. ( )
------------------------------------------------------
Street

-------------------------, ---------------, ----------
City State Zip

B8 LOCATION OF EMPLOYER'S PRINCIPAL OFFICE:

a. (X) State b. ( ) Commonwealth of c. Georgia
------------ -------
and this Plan and Trust shall be governed under the same.

B9 EMPLOYER FISCAL YEAR means the 12 consecutive month period:

Commencing on a. January 1st (e.g., January 1st) and ending on
-----------------
month day

b. December 1st .
-----------------
month day

-2-
<PAGE> 3

PLAN INFORMATION

C1 EFFECTIVE DATE

This Adoption Agreement of the Wheat First Butcher Singer
Non-Standardized 401(k) Profit Sharing Plan and Trust shall:

a. ( ) establish a new Plan and Trust effective as of ______________
(hereinafter called the "Effective Date").

b. (X) constitute an amendment and restatement in its entirety of a
previously established qualified Plan and Trust of the Employer
which was effective January 1, 1989 (hereinafter called the
"Effective Date"). Except as specifically provided in the Plan,
the effective date of this amendment and restatement is December
1, 1997 (For TRA `86 amendments, enter the first day of the first
Plan Year beginning in 1989).

C2 PLAN YEAR means the 12 consecutive month period:

Commencing on a. December 1st (e.g., January 1st)
------------

and ending on b. November 30th .
------------------------------------

IS THERE A SHORT PLAN YEAR?

c. (X) No

d. ( ) Yes, beginning
------------------------------
and ending .
----------------------------------

C3 ANNIVERSARY DATE of Plan (Annual Valuation Date)

a. November 30th
------------------------------
month day

C4 PLAN NUMBER assigned by the Employer (select one)

a. (X) 001 b. ( ) 002 c. ( ) 003 d. ( ) Other
----------

C5 NAME OF PLAN ADMINISTRATOR (Document provides for the Employer to
appoint an Administrator. If none is named, the Employer will become
the Administrator.)

a. (X) Employer (Use Employer Address)

b. ( ) Name
-------------------------------------------------------

Address ( ) Use Employer Address

-----------------------------------------------------------

-------------------------, ---------------------, ----------
City State Zip

Telephone
--------------------------------------------------

Administrator's I.D. Number
--------------------------------

-3-
<PAGE> 4

C6 PLAN'S AGENT FOR SERVICE OF LEGAL PROCESS

a. (X) Employer (Use Employer Address)

b. ( ) Name
-------------------------------------------------------

Address
----------------------------------------------------

----------------------------------------------------

ELIGIBILITY, VESTING AND RETIREMENT AGE

D1 ELIGIBLE EMPLOYEES (Plan Section 1.15) shall mean:

a. (X) all Employees who have satisfied the eligibility
requirements.
b. ( ) all Employees who have satisfied the eligibility requirements
except those checked below:

1. ( ) Employees paid by commissions only.
2. ( ) Employees hourly paid.
3. ( ) Employees paid by salary.
4. ( ) Employees whose employment is governed by a collective
bargaining agreement between the Employer and "employee
representatives" under which retirement benefits were the
subject of good faith bargaining. For this purpose, the
term "employee representatives" does not include any
organization more than half of whose members are employees
who are owners, officers, or executives of the Employer.
5. ( ) Highly Compensated Employees.
6. ( ) Employees who are non-resident aliens who received no
earned income (within the meaning of Code Section
911(d)(2)) from the Employer which constitutes income from
sources within the United States (within the meaning of
Code Section 861(a)(3)).
7. ( ) Other

NOTE: For purposes of this section, the term Employee shall include all
Employees of this Employer and any leased employees deemed to be
Employees under Code Section 414 (n) or 414 (o).

D2 EMPLOYEES OF AFFILIATED EMPLOYERS (Plan Section 1.16)

Employees of Affiliated Employers:

a. ( ) will not or N/A

b. ( ) will

be treated as Employees of the Employer adopting the Plan.

NOTE: If D2b is elected, each Affiliated Employer should execute this
Adoption Agreement as a Participating Employer.

-4-
<PAGE> 5

D3 HOURS OF SERVICE (Plan Section 1.31) will be determined on the basis of
the method selected below. Only one method may be selected. The method
selected will be applied to all Employees covered under the Plan.

a. (X) On the basis of actual hours for which an Employee is paid
or entitled to payment.

b. ( ) On the basis of days worked. An Employee will be credited
with ten (10) Hours of Service if under the Plan such
Employee would be credited with at least one (1) Hour of
Service during the day.

c. ( ) On the basis of weeks worked. An Employee will be credited
forty-five (45) Hours of Service if under the Plan such
employee would be credited with at least one (1) Hour of
Service during the week.

d. ( ) On the basis of semi-monthly payroll periods. An Employee
will be credited with ninety-five (95) Hours of Service if
under the Plan such Employee would be credited with at least
one (1) Hour of Service during the semi-monthly payroll
period.

e. ( ) On the basis of months worked. An Employee will be credited
with one hundred ninety (190) Hours of Service if under the
Plan such Employee would be credited with at least one (1)
Hour of Service during the month.

D4 CONDITIONS OF ELIGIBILITY (Plan Section 3. 1).
(Check either a OR b and c, and if applicable, d)

Any Eligible Employee will be eligible to participate in the Plan if
such Eligible Employee has satisfied the service and age requirements,
if any, specified below:

a. ( ) NO AGE OR SERVICE REQUIRED.

b. (X) SERVICE REQUIREMENT. (may not exceed 1 year)
1. ( ) None
2. ( ) 1/2 Year of Service
3. ( ) 1 Year of Service
4. (X) Other: 30 days of service for salary deferral; 1 year
of service for matching contributions.
------------------------------------------------------------

NOTE: If the Year(s) of Service selected is or includes a fractional
year, an Employee will not be required to complete any specified
number of Hours of Service to receive credit for such fractional
year. If expressed in Months of Service, an Employee will not be
required to complete any specified number of Hours of Service in a
particular month.

c. (X) AGE REQUIREMENT (may not exceed 21)
1. ( ) NA - No Age Requirement.
2. ( ) 20 1/2
3. (X) 21
4. ( ) Other
-------------------------------------------------

d. ( ) FOR NEW PLANS ONLY - Regardless of any of the above age or
service requirements, any Eligible Employee who as employed on the
Effective Date of the Plan shall be eligible to participate
hereunder and shall enter the Plan as of such date.

-5-
<PAGE> 6

D5 EFFECTIVE DATE OF PARTICIPATION (Plan Section 3.2) An Eligible Employee
shall become a Participant as of:

a. ( ) the first day of the Plan Year in which he met the
requirements.

b. ( ) the first day of the Plan Year in which he met the
requirements, if he met the requirements in the first 6 months of
the Plan Year, or as of the first day of the next succeeding Plan
Year, or as of the first day of the next succeeding Plan Year if
he met the requirements in the last 6 months of the Plan Year.

c. ( ) the earlier of the first day of the seventh month or the
first day of the Plan Year coinciding with or next following the
date on which he met the requirements.

d. ( ) the first day of the Plan Year next following the date on
which he met the requirements. (Eligibility must be 1/2 Year of
Service or less and age 20 1/2 or less).

e. ( ) the first day of the month coinciding with or next following
the date on which he met the requirements.

f. (X) Other: the first day of the quarter coinciding with or next
following the date on which he met the requirements, provided that
an Employee who has satisfied the maximum age and service
requirements that are permissible in Section D4 above and who is
otherwise entitled to participate, shall commence participation no
later than the earlier of (a) 6 months after such requirements are
satisfied, or (b) the first day of the first Plan Year after such
requirements are satisfied, unless the Employee separates from
service before such participation date.

D6 VESTING OF PARTICIPANT'S INTEREST (Plan Section 6.4(b))

The vesting schedule, based on number of Years of Service, shall be as
follows:

a. (X) 100% upon entering Plan. (Required if eligibility
requirement is greater than one (1) Year of Service.)

<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
b. ( ) 0-2 years 0% c. ( ) 0-4 years 0%
3 years 100% 5 years 100%

d. ( ) 0-1 year 0% e. ( ) 1 year 25%
2 years 20% 2 years 50%
3 years 40% 3 years 75%
4 years 60% 4 years 100%
5 years 80%
6 years 100%

f. ( ) 1 year 20% g. ( ) 0-2 years 0%
2 years 40% 3 years 20%
3 years 60% 4 years 40%
4 years 80% 5 years 60%
5 years 100% 6 years 80%
7 years 100%
</TABLE>

-6-
<PAGE> 7

h. ( ) Other - Must be at least as liberal as either c or g above.

Years of Service Percentage
--------------------------- -------------------------
--------------------------- -------------------------
--------------------------- -------------------------
--------------------------- -------------------------
--------------------------- -------------------------
--------------------------- -------------------------

D7 FOR AMENDED PLANS (Plan Section 6.4(f)). If the vesting schedule has
been amended to a less favorable schedule, enter the pre-amended
schedule below:

a. (X) Vesting schedule has not been amended or amended schedule is
more favorable in all years.

b. ( ) Years of Service Percentage
--------------------------- -------------------------
--------------------------- -------------------------
--------------------------- -------------------------
--------------------------- -------------------------

D8 TOP HEAVY VESTING (Plan Section 6.4(c)). If this Plan becomes a Top
Heavy Plan, the following vesting schedule, based on number of Years of
Service, for such Plan Year and each succeeding Plan Year, whether or
not the Plan is a Top Heavy Plan, shall apply and shall be treated as a
Plan amendment pursuant to this Plan. Once effective, this schedule
shall also apply to any contributions made prior to the effective date
of Code Section 416 and/or before the Plan became a Top Heavy Plan.

a. (X) N/A (D6a, b, d, e or f was selected)

<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
b. ( ) 0-1 years 0% c. ( ) 0-2 years 0%
2 years 20% 3 years 100%
3 years 40%
4 years 60%
5 years 80%
6 years 100%
</TABLE>

NOTE: This section does not apply to the Account balances of any
Participant who does not have an Hour of Service after the Plan
has initially become top heavy. Such Participant's Account balance
attributable to Employer contributions and Forfeitures will be
determined without regard to this section.

D9 VESTING (Plan Section 6.4(h)). In determining Years of Service for
vesting purposes, Years of Service attributable to the following shall
be EXCLUDED:

a. ( ) Service prior to the Effective Date of the Plan or a
predecessor plan.
b. (X) N/A
c. ( ) Service prior to the time an Employee attained age 18.
d. (X) N/A

-7-
<PAGE> 8

D10 PLAN SHALL RECOGNIZE SERVICE WITH PREDECESSOR EMPLOYER

a. (X) No.

b. ( ) Yes: Years of Service with ___ shall be recognized for the
purpose of this Plan.

NOTE: If the predecessor Employer maintained this qualified Plan, then
Years of Service with such predecessor Employer shall be
recognized pursuant to Section 1.74, and b. must be marked.

D11 NORMAL RETIREMENT AGE ("NRA") (Plan Section 1.42) means:

a. (X) the date a Participant attains his 65th birthday. (not to
exceed 65th)
b. ( ) the later of the date a Participant attains his __ birthday
(not to exceed 65th) or the
c. ( ) (not to exceed 5th) anniversary of the first day of the Plan
Year in which participation in the Plan commenced.

D12 NORMAL RETIREMENT DATE (Plan Section 1.43) shall commence:

a. ( ) as of the Participant's "NRA."
OR (must select b. or c. AND 1. or 2.)
b. (X) as of the first day of the month...
c. ( ) as of the Anniversary Date...
1. (X) coinciding with or next following the Participant's
"NRA."
2. ( ) nearest the Participant's "NRA."

D13 EARLY RETIREMENT DATE (Plan Section 1.12) means the:

a. (X) No Early Retirement provision provided.
b. ( ) date on which a Participant...
c. ( ) first day of the month coinciding with or next following the
date on which a Participant...
d. ( ) Anniversary Date coinciding with or next following the date
on which a Participant...

AND, if b, c or d was selected...
1. ( ) attains his ____ birthday and has
2. ( ) completed at least ___ Years of Service.

-8-
<PAGE> 9

CONTRIBUTIONS, ALLOCATIONS AND DISTRIBUTIONS

E1 a. COMPENSATION (Plan Section 1.9) with respect to any
Participant means:

1. (X) Wages, tips and other Compensation on Form W-2.
2. ( ) Section 3401(a) wages (wages for withholding purposes).
3. ( ) 415 safe-harbor compensation.

AND COMPENSATION

1. (X) shall
2. ( ) shall not

exclude (even if includable in gross income) reimbursements or
other expense allowances, fringe benefits (cash or noncash),
moving expenses, deferred compensation, and welfare benefits.

b. COMPENSATION shall be

1. (X) actually paid (must be selected if Plan is integrated)
2. ( ) accrued

c. HOWEVER, FOR NON-INTEGRATED PLANS, Compensation shall exclude
(select all that apply):

( ) N/A. No exclusions
( ) overtime
( ) bonuses
( ) commissions
(X) Other the profit sharing bonus paid on 12/15 of each year.
---------------------------------------------------

d. FOR PURPOSES OF THIS SECTION E1, Compensation shall be based on:

1. (X) the Plan Year.
2. ( ) the Fiscal Year coinciding with or ending within the
Plan Year.
3. ( ) the Calendar Year coinciding with or ending within the
Plan Year.

NOTE: The Limitation Year shall be the same as the year on which
Compensation is based.

e. HOWEVER, for an Employee's first year of participation,
Compensation shall be recognized as of:

1. ( ) the first day of the Plan Year.
2. (X) the date the Participant entered the Plan.

f. IN ADDITION, COMPENSATION and "414(s) Compensation"

1. ( ) shall
2. (X) shall not include compensation which is not currently
includible in the Participant's gross income by reason of the
application of Code Sections 125, 402(a)(8), 402(h)(1)(B) or
403(b).

-9-
<PAGE> 10

E2 SALARY REDUCTION ARRANGEMENT - ELECTIVE CONTRIBUTION
(Plan Section 11.2). Each Employee may elect to have his Compensation
reduced by:

a. ( ) _______%

b. ( ) up to ______%

c. (X) from 1% to 15%
-- ---

d. ( ) up to the maximum percentage allowable not to exceed
the limits of Code Sections 401(k), 404 and 415.

AND...

e. (X) A Participant may elect to commence salary reductions as
of 12/1, 3/1, 6/1 or 9/1 (ENTER AT LEAST ONE DATE OR PERIOD). A
Participant may modify the amount of salary reductions as of 12/1,
3/1, 6/1 or 9/1 (ENTER AT LEAST ONE DATE OR PERIOD).

AND...

Shall cash bonuses paid within 2 1/2 months after the end of the Plan
Year be subject to the salary reduction election?

f. ( ) Yes

g. (X) No

E3 FORMULA FOR DETERMINING EMPLOYER'S MATCHING CONTRIBUTION (Plan Section
11.1(b))

a. ( ) N/A. There shall be no matching contributions.

b. ( ) The Employer shall make matching contributions equal to
____% (e.g. 50%) of the Participant's salary reductions.

c. (X) The Employer may make matching contributions equal to a
discretionary percentage, to be determined by the Employer, of the
Participant's salary reductions.

d. ( ) The Employer shall make matching contributions equal to
the sum of ____% of the portion of the Participant's salary
reduction which does not exceed ____% of the Participant's
Compensation plus ___% of the portion of the Participant's salary
reduction which exceeds __% of the Participant's Compensation, but
does not exceed ____% of the Participant's Compensation.

e. ( ) The Employer shall make matching contributions equal to
the percentage determined under the following schedule:

Participant's Total Matching Percentage
Years of Service
---------------- ---------------
---------------- ---------------
---------------- ---------------

-10-
<PAGE> 11

FOR PLANS WITH MATCHING CONTRIBUTIONS

f. (X) Matching contributions

g. (X) shall

h. ( ) shall not be used in satisfying the deferral percentage
tests. (If used, full vesting and restrictions on withdrawals will
apply and the match will be deemed to be an Elective
Contribution).

i. (X) Shall a Year of Service be required in order to share in
the matching contributions?

With respect to Plan Years beginning after 1989...
1. (X) Yes (Could cause Plan to violate minimum participation
and coverage requirements under Code Sections 401(a)(26) and 410)
2. ( ) No

With respect to Plan Years beginning before 1990...
1. (X) N/A, new Plan, or same as years beginning after 1989
2. ( ) Yes
3. ( ) No

j. ( ) In determining matching contributions, only salary
reductions up to _____% of a Participant's Compensation will be
matched. k. (X) N/A

l. ( ) The matching contribution made on behalf of a
Participant for any Plan Year shall not exceed $_______.
m. (X) N/A

n. (X) Matching contributions shall be made on behalf of
1. (X) all Participants.
2. ( ) only Non-Highly Compensated Employees.

o. (X) Notwithstanding anything in the Plan to the contrary,
all matching contributions which relate to distributions of Excess
Deferred Compensation, Excess Contributions, and Excess Aggregate
Contributions shall be Forfeited. (Select this option only if it
is applicable.)

E4 WILL A DISCRETIONARY EMPLOYER CONTRIBUTION BE PROVIDED (OTHER THAN A
DISCRETIONARY MATCHING OR QUALIFIED NON-ELECTIVE CONTRIBUTION) (Plan
Section 11.1(c)?)

a. ( ) No.
b. ( ) Yes, the Employer may make a discretionary contribution
out of its current or accumulated Net Profit.
c. ( ) Yes, the Employer may make a discretionary contribution
which is not limited to its current or accumulated Net Profit.

-11-
<PAGE> 12

IF YES (b. or c. is selected above), the Employer's discretionary
contribution shall be allocated as follows:

d. (X) FOR A NON-INTEGRATED PLAN

The Employer discretionary contribution for the Plan Year shall be
allocated in the same ratio as each Participant's Compensation bears to
the total of such Compensation of all Participants.

e. ( ) FOR AN INTEGRATED PLAN

The Employer discretionary contribution for the Plan Year shall be
allocated in accordance with Plan Section 4.3(b)(2) based on a
Participant's Compensation in excess of:

f. ( ) The Taxable Wage Base.

g. ( ) The greater of $10,000 or 20% of the Taxable Wage Base.

h. ( ) ___% of the Taxable Wage Base. (See Note below)

i. ( ) $_____. (See Note below)

NOTE: The integration percentage of 5.7% shall he reduced to:

1. 4.3% if h. or i. above is more than 20% and less than or
equal to 80% of the Taxable Wage Base.
2. 5.4% if h. or i. above is less than 100% and more than 80%
of the Taxable Wage Base.

E5 QUALIFIED NON-ELECTIVE CONTRIBUTIONS (Plan Section 11.1(d))

a. (X) N/A. There shall be no Qualified Non-Elective Contributions
except as provided in Section 11.5(b) and 11.7(h).

b. ( ) The Employer shall make a Qualified Non-Elective Contribution
equal to ____% of the total Compensation of all Participants
eligible to share in the allocations.

c. ( ) The Employer may make a Qualified Non-Elective Contribution
in an amount to be determined by the Employer.

E6 FORFEITURES (Plan Section 4.3(e))

a. Forfeitures of contributions other than matching contributions
shall be...

1. ( ) added to the Employer's contribution under the Plan.
2. ( ) allocated to all Participants eligible to share in the
allocations in the same proportion that each Participant's
Compensation for the year bears to the Compensation of all
Participants for such year.

-12-
<PAGE> 13

b. Forfeitures of matching contributions shall be...

1. ( ) N/A. No matching contributions or match is fully
vested.
2. ( ) used to reduce the Employer's matching contribution.
3. ( ) allocated to all Participants eligible to share in the
allocations in proportion to each such Participant's
Compensation for the year.
4. ( ) allocated to all Non-Highly Compensated Employee's
eligible to share in the allocations in proportion to each
such Participant's Compensation for the year.

E7 ALLOCATIONS TO ACTIVE PARTICIPANTS (Plan Section 4.3) With respect to
Plan Years beginning after 1989, a Participant ...

a. ( ) shall (Plan may become discriminatory)

b. (X) shall not

be required to complete a Year of Service in order to share in any
Non-Elective Contributions (other than matching contributions) or
Qualified Non-Elective Contributions. For Plan Years beginning before
1990, the Plan provides that a Participant must complete a Year of
Service to share in the allocations.

E8 ALLOCATIONS TO TERMINATED PARTICIPANTS (Plan Section 4.3(k))
Any Participant who terminated employment during the Plan Year (i.e.
not actively employed on the last day of the Plan Year) for reasons
other than death, Total and Permanent Disability or retirement:

a. With respect to Employer Non-Elective Contributions (other than
matching), Qualified Non-Elective Contributions, and Forfeitures:

1. For Plan Years beginning after 1989,
i. ( ) N/A, Plan does not provide for such contributions.
ii. ( ) shall share in the allocations provided such
Participant completed more than 500 Hours of
Service.
iii. ( ) shall share in such allocations provided such
Participant completed a Year of Service.
iv. (X) shall not share in such allocations, regardless of
Hours of Service.

2. For Plan Years beginning before 1990,

i. (X) N/A, new Plan, or same as for Plan Years beginning
after 1989.
ii. ( ) shall share in such allocations provided such
Participant completed a Year of Service.
iii. ( ) shall not share in such allocations, regardless of
Hours of Service.

-13-
<PAGE> 14

NOTE: If a.l.iii or iv is selected, the Plan could violate minimum
participation and coverage requirements under Code Sections 401(a)(26)
and 410.

b. With respect to the allocation of Employer Matching Contributions,
a Participant:

1. For Plan Years beginning after 1989,

i. ( ) N/A, Plan does not provide for matching
contributions.
ii. ( ) shall share in the allocations, regardless of
Hours of Service.
iii. ( ) shall share in the allocations provided such
Participant completed more than 500 Hours of
Service.
iv. ( ) shall share in such allocations provided such
Participant completed a Year of Service.
v. (X) shall not share in such allocations, regardless of
Hours of Service.

2. For Plan Years beginning before 1990,

i. (X) N/A, new Plan, or same as years beginning after
1989.
ii. ( ) shall share in the allocations, regardless of
Hours of Service.
iii. ( ) shall share in such allocations provided such
Participant completed a Year of Service.
iv. ( ) shall not share in such allocations, regardless of
Hours of Service.

NOTE: If b.l.iv or v is selected, the Plan could violate minimum
participation and coverage requirements under Code Section 401(a)(26)
and 410.

E9 ALLOCATIONS OF EARNINGS (Plan Section 4.3(c))

Allocations of earnings with respect to amounts contributed to the Plan
after the previous Anniversary Date or other valuation date shall be
determined...

a. (X) by using a weighted average
b. ( ) by treating one-half of all such contributions as being a
part of the Participant's nonsegregated account balance as of the previous
Anniversary Date or valuation date.
c. ( ) by using the method specified in Section 4.3(c).
d. ( ) other _____

E10 LIMITATIONS ON ALLOCATIONS (Plan Section 4.4)

a. If any Participant is or was covered under another qualified
defined contribution plan maintained by the Employer, other than a
Master or Prototype Plan, or if the Employer maintains a welfare
benefit fund, as defined in Code Section 419(e), or an individual
medical account, as defined in Code Section 415(l)(2), under which
amounts are treated as Annual Additions with respect to any
Participant in this Plan:

-14-
<PAGE> 15

1. (X) N/A.
2. ( ) The provisions of Section 4.4(b) of the Plan will apply
as if the other plan were a Master or Prototype Plan.
3. ( ) Provide the method under which the Plans will limit
total Annual Additions to the Maximum Permissible
Amount, and will properly reduce any Excess Amounts, in
a manner that precludes Employer discretion.

b. If any Participant is or ever has been a Participant in a defined
benefit plan maintained by the Employer:

1. (X) N/A.
2. ( ) In any Limitation Year, the Annual Additions credited to
the Participant under this Plan may not cause the sum of
the Defined Benefit Plan Fraction and the Defined
Contribution Fraction to exceed 1.0. If the Employer's
contribution that would otherwise be made on the
Participant's behalf during the limitation year would
cause the 1.0 limitation to be exceeded, the rate of
contribution under this Plan will be reduced so that the
sum of the fractions equals 1.0. If the 1.0 limitation
is exceeded because of an Excess Amount, such Excess
Amount will be reduced in accordance with Section
4.4(a)(4) of the Plan.
3. ( ) Provide the method under which the Plans involved will
satisfy the 1.0 limitation in a manner that precludes
Employer discretion.

E11 DISTRIBUTIONS UPON DEATH (Plan Section 6.6 (h))

Distributions upon the death of a Participant prior to receiving any
benefits shall...

a. (X) be made pursuant to the election of the Participant or
beneficiary.
b. ( ) begin within 1 year of death for a designated beneficiary and
be payable over the life (or over a period not exceeding the
life expectancy) of such beneficiary, except that if the
beneficiary is the Participant's spouse, begin within the
time the Participant would have attained age 70 1/2.
c. ( ) be made within 5 years of death for all beneficiaries
d. ( ) other _____

E12 LIFE EXPECTANCIES (Plan Section 6.5(f)) for minimum distributions
required pursuant to Code Section 401(a)(9) shall...

a. (X) be recalculated at the Participant's election.
b. ( ) be recalculated.
c. ( ) not be recalculated.

-15-
<PAGE> 16

E13 CONDITIONS FOR DISTRIBUTIONS UPON TERMINATION

Distributions upon termination of employment pursuant to Section 6.4(a)
of the Plan shall not be made unless the following conditions have been
satisfied:

a. ( ) N/A. Immediate distributions may be made at Participant's
election.
b. ( ) The Participant has incurred _____ 1-Year Break(s) in
Service.
c. ( ) The Participant has reached his or her Early or Normal
Retirement Age.
d. (X) Distributions may be made at the Participant's election on or
after the Anniversary Date following termination of
employment.
e. ( ) Other _____

E14 FORM OF DISTRIBUTIONS (Plan Sections 6. 5 and 6. 6)
Distributions under the Plan may be made...

a. 1. ( ) in lump sums.
2. (X) in lump sums or installments.

b. AND, pursuant to Plan Section 6.13,

1. ( ) no annuities are allowed (avoids Joint and Survivor
rules).
2. (X) annuities are allowed (Plan Section 6.13 shall not
apply).

NOTE: b.1. above may not be elected if this is an amendment to a plan
which permitted annuities as a form of distribution or if this
Plan has accepted a plan to plan transfer of assets from a plan
which permitted annuities as a form of distribution.

c. AND may he made in . . .

1. (X) cash only (except for insurance or annuity contracts).
2. ( ) cash or property.

TOP HEAVY REQUIREMENTS

F1 TOP HEAVY DUPLICATIONS (Plan Section 4.3(i)): When a Non-Key Employee
is a Participant in this Plan and a Defined Benefit Plan maintained by
the Employer, indicate which method shall be utilized to avoid
duplication of top heavy minimum benefits.

a. (X) The Employer does not maintain a Defined Benefit Plan.
b. ( ) A minimum, non-integrated contribution of 5% of each Non-Key
Employee's total Compensation shall be provided in this Plan,
as specified in Section 4.3(i). (The Defined Benefit and
Defined Contribution Fractions will be computed using 100% if
this choice is selected.)
c. ( ) A minimum, non-integrated contribution of 7 1/2% of each
Non-Key Employee's total Compensation shall be provided in
this Plan, as specified in Section 4.3(i). (If this choice is
selected, the Defined Benefit and Defined

-16-
<PAGE> 17

Contribution Fractions will be computed using 125% for all
Plan Years in which the Plan is Top Heavy, but no Super Top
Heavy.)

d. ( ) Specify the method under which the Plans will provide top
heavy minimum benefits for Non-Key Employees that will
preclude Employer discretion and avoid inadvertent omissions,
including any adjustments required under Code Section 415(e).

F2 PRESENT VALUE OF ACCRUED BENEFIT (Plan Section 2.2) for Top Heavy
purposes where the Employer maintains a Defined Benefit Plan in
addition to this Plan, shall be based on...

a. (X) N/A. The Employer does not maintain a defined benefit plan.

b. ( ) Interest Rate: _____

Mortality Table: _____

F3 TOP HEAVY DUPLICATIONS: Employer maintaining two(2) or more Defined
Contribution Plans.

a. (X) N/A.

b. ( ) A minimum, non-integrated contribution of 3% of each Non-Key
Employee's total Compensation shall be provided in the Money
Purchase Plan (or other plan subject to Code Section 412),
where the Employer maintains two (2) or more non-paired
Defined Contribution Plans.

c. ( ) Specify the method under which the Plans will provide top
heavy minimum benefits for Non-Key Employees that will
preclude Employer discretion and avoid inadvertent omissions,
including any adjustments required under Code Section 415(e).

MISCELLANEOUS

G1 LOANS TO PARTICIPANTS (Plan Section 7.4)

a. ( ) Yes, loans may be made up to $50,000 or 1/2 Vested interest.
b. (X) No, loans may not be made.
If YES, (check all that apply)...
c. ( ) loans shall he treated as a Directed Investment.
d. ( ) loans shall only be made for hardship or financial necessity.
e. ( ) the minimum loan shall be $1,000.
f. ( ) $10,000 de minimis loans may be made regardless of Vested
interest. (If selected, Plan may need security in addition to
Vested interest.)

-17-
<PAGE> 18

NOTE: Department of Labor Regulations require the adoption of a
SEPARATE written loan program setting forth the requirements
outlined in Plan Section 7.4.

G2 DIRECTED INVESTMENT ACCOUNTS (Plan Section 4.8) are permitted for the
interest in any one or more accounts.

a. (X) Yes, regardless of the Participant's Vested interest in the
Plan.

b. ( ) Yes, but only with respect to the Participant's Vested
interest in the Plan.

c. ( ) Yes, but only with respect to those accounts which are 100%
Vested.

d. ( ) No directed investments are permitted.

G3 TRANSFERS FROM QUALIFIED PLANS (Plan Section 4.6)

a. ( ) Yes, transfers from qualified plans (and rollovers) will be
allowed.

b. (X) No, transfers from qualified plans (and rollovers) will not
be allowed.

AND, transfers shall be permitted...

c. ( ) from any Employee, even if not a Participant.

d. ( ) from Participants only.

G4 EMPLOYEES' VOLUNTARY CONTRIBUTIONS (Plan Section 4.7)

a. ( ) Yes, Voluntary Contributions are allowed subject to the
limits of Section 4.10.

b. (X) No. Voluntary Contributions will not be allowed.

NOTE: TRA `86 subjects voluntary contributions to strict
discrimination rules.

G5 HARDSHIP DISTRIBUTIONS (Plan Sections 6.11 and 11.8)

a. (X) Yes, from any accounts which are 100% Vested.

b. ( ) Yes, from Participant's Elective Account only.

c. ( ) Yes, but limited to the Participant's Account only.

d. ( ) No.

NOTE: Distributions from a Participant's Elective Account are
limited to the portion of such account attributable to such
Participant's Deferred Compensation and earnings attributable
thereto up to December 31, 1988. Also hardship distributions
are not permitted from a Participant's Qualified Non-Elective
Account.

-18-
<PAGE> 19

G6 PRE-RETIREMENT DISTRIBUTION (Plan Section 6.10)

a. ( ) If a Participant has reached the age of _____, distributions
may be made, at the Participant's election, from any accounts
which are 100% Vested without requiring the Participant to
terminate employment.

b. (X) No pre-retirement distribution may be made.

NOTE: Distributions from a Participant's Elective Account and
Qualified Non-Elective Account are not permitted prior to age
59 1/2.

G7 LIFE INSURANCE (Plan Section 7.2(d)) may be purchased with Plan
contributions.

a. ( ) No life insurance may be purchased.

b. (X) Yes, at the option of the Administrator

c. ( ) Yes, at the option of the Participant

The adopting Employer may not rely on an opinion letter issued by the National
Office of the Internal Revenue Service as evidence that the plan is qualified
under Code Section 401. In order to obtain reliance with respect to plan
qualification, the Employer must apply to the appropriate Key District Office
for a determination letter.

This Adoption Agreement may be used only in conjunction with basic Plan document
01. This Adoption Agreement and the basic Plan document shall together be known
as Wheat First Butcher Singer Non-Standardized 401(k) Profit Sharing Plan and
Trust 01-003.

The adoption of this Plan, its qualification by the IRS, and the related tax
consequences are the responsibility of the Employer and its independent tax and
legal advisors.

Wheat First Butcher Singer will notify the Employer of any amendments made to
the Plan or of the discontinuance or abandonment of the Plan provided this Plan
has been acknowledged by Wheat First Butcher Singer or its authorized
representative. Furthermore, in order to be eligible to receive such
notification, we agree to notify Wheat First Butcher Singer of any change in
address.

-19-
<PAGE> 20

IN WITNESS WHEREOF, the Employer and Trustee hereby cause this Plan to be
executed on this 1st day of December, 1997. Furthermore, this Plan may not be
used unless acknowledged by Wheat First Securities, Inc. or its authorized
representative.

EMPLOYER:

E3 ASSOCIATES, LTD. /s/ Frank K. Schuster
- ------------------------------------- -------------------------------------
(enter name) TRUSTEE

/s/ William H. Huther
-------------------------------------
By: /s/ Frank K. Schuster TRUSTEE
- -------------------------------------

PARTICIPATING EMPLOYER: /s/ Anders H. Herlitz
-------------------------------------
TRUSTEE

Inventory Management Institute, Inc. (58-1876949)
Technology Investment Leasing & Loan, Inc.
(58-1828841)
- -------------------------------------------------
(enter name)

By: /s/ Frank K. Schuster
- -------------------------------------

This Plan may not be used, and shall not be deemed to be a Prototype Plan,
unless an authorized representative of Wheat First Securities, Inc. (the
sponsor) has acknowledged the use of the Plan. Such acknowledgment is for
administerial purposes only. It acknowledges that the Employer is using the Plan
but does not represent that this Plan, including the choices selected on the
Adoption Agreement, has been reviewed by a representative of the sponsor or
constitutes a qualified retirement plan.

Wheat First Securities, Inc.

By: /s/ Bonnie V. Sjostrom
-------------------------

With regard to any questions regarding the provisions of the Plan, adoption of
the Plan, or the effect of an opinion letter from the IRS, call or write (this
information must be completed by the sponsor of this Plan or its designated
representative):

Name Wheat First Butcher Singer
----------------------------------

Address 901 E. Byrd Street
----------------------------------
Richmond, VA 23219
----------------------------------

Telephone ( ) 804-649-2311
----------------------------------

-20-
<PAGE> 21

WHEAT FIRST
BUTCHER SINGER

Amendment Number Three To
Wheat First Butcher Singer
Defined Contribution Plan and Trust

1. Article VI of the Plan is amended by the addition of the new subsection,
effective as of the following date:

a. For Plans not entitled to extended reliance as described in Revenue
Ruling, 94-76, the first day of the first Plan Year beginning on or
after December 31, 1994, of if later, 90 days after December 31, 1994,
or

b. For Plans entitled to extended reliance as described in Revenue Ruling
94-76, as of the first day of the first plan year beginning in 1999.
However, in the event of a transfer of assets to the Plan from a money
purchase plan that occurs after the date of the most recent
determination letter, the effective date of the amendment shall be the
date immediately preceding the date of such transfer of assets.

Transfer of Assets From a Money Purchase Plan

Notwithstanding any provision of this plan to the contrary, to the extent
that any optional form of benefit under this plan permits a distribution prior
to the employee's retirement, death, disability or severance from employment,
and prior to plan termination, the optional form of benefit is not available
with respect to benefits attributable to assets (including the post-transfer
earnings thereon) and liabilities that are transferred, within the meaning of
Section 414(l) of the Internal Revenue Code, to this plan from a money purchase
pension plan qualified under 401(a) of the Internal Revenue Code (other than any
portion of those assets and liabilities attributable to voluntary employee
contributions).

Pursuant to the terms of the Plan regarding amendment, Wheat First Butcher
Singer, as sponsor of prototype, hereby adopts this amendment as of the date set
forth below.

Wheat First Butcher Singer

By: /s/ Francis C. Rickman
-------------------------------------
Title: Senior Vice President
----------------------------------
Date: June 16, 1997
-----------------------------------

<PAGE> 22

WHEAT FIRST
BUTCHER SINGER

Amendment Number Four To
Wheat First Butcher Singer
Defined Contribution Plan and Trust

1. Article VI is amended by the addition of the following new subsection,
effective as of December 21, 1994:

UNIFORMED SERVICES

Notwithstanding any provision of this plan to the contrary,
contributions, benefits and service credit with respect to qualified military
service will be provided in accordance with Section 414(u) of the Internal
Revenue Code.

Loan payments will be suspended under this plan as permitted under Code
Section 414(u)(4).

Pursuant to the terms of the Plan regarding amendments, Wheat First Butcher
Singer, as sponsor of the prototype, hereby adopts this amendment as of the date
set forth below.

Wheat First Butcher Singer

By: /s/ Francis C. Rickman
-------------------------------------
Title: Senior Vice President
----------------------------------
Date: June 16, 1997
-----------------------------------

<PAGE> 23

INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY
Plan Description: Prototype Non-Standardized Profit Sharing Plan with CODA
FFN: 50369570701-003 Case: 8907126 EIN: 54-0796506
SPD: 01 Plan: 003 Letter Serial No.: D343319a

Wheat First Butcher Singer

Washington, DC 20224
901 East Byrd Street Person to Contact: Ms. Arrington
Richmond, VA 23219 Telephone: (202) 566-4576
Refer Reply to: E: EP: Q: ICU
Date: 2/23/90

Dear Applicant:

In our opinion, the form of the plan identified above is acceptable under
section 401 of the Internal Revenue Code for use by employers for the benefit of
their employees. This opinion relates only to the acceptability of the form of
the plan under the Internal Revenue Code. It is not an opinion of the effect of
other Federal or local statutes.

You must furnish a copy of this letter to each employer who adopts this plan.
You are also required to send a copy of the approved form of the plan, any
approved amendments and related documents to each Key District Director of
Internal Revenue Service in whose jurisdiction there are adopting employers.

Our opinion on the acceptability of the form of the plan is not a ruling or
determination as to whether an employer's plan qualifies under Code section
401(a). Therefore, an employer adopting the form of the plan should apply for a
determination letter by filing an application with the Key District Director of
Internal Revenue Service on Form 5307, Short Form Application for Determination
for Employee Benefit Plan.

If you, the plan sponsor, have any questions concerning the IRS processing of
this case, please call the above telephone number. This number is only for use
of the plan sponsor. Individual participants and/or adopting employers with
questions concerning the plan should contact the plan sponsor. This plan's
adoption agreement must include the sponsor's address and telephone number for
inquiries by adopting employers.

If you write to the IRS regarding this plan, please provide your telephone
number and the most convenient time for us to call in case we need more
information. Whether you call or write, please refer to the Letter Serial Number
and File Folder Number shown in the heading of this letter.

You should keep this letter as a permanent record. Please notify us if you
modify or discontinue sponsorship of this plan.

Sincerely yours,

Chief, Employee Plans Qualifications Branch

<PAGE> 24

INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY
Plan Description: Prototype Non-Standardized Profit Sharing Plan with CODA
FFN: 50369570701-002 Case: 9300941 EIN: 54-0796506
SPD: 01 Plan: 002 Letter Serial No.: D343318b

Wheat First Butcher Singer

Washington, DC 20224
901 East Byrd Street Person to Contact: Ms. Arrington
Richmond, VA 23219 Telephone: (202) 622-8173
Refer Reply to: E: EP: Q: ICU
Date: 1/21/93

Dear Applicant:

In our opinion, the form of the plan identified above does not in and of itself
adversely affect the plan's acceptability under section 401 of the Internal
Revenue Code. This opinion relates only to the form of the plan. It is not an
opinion as to the acceptability of any other amendment or of the form of the
plan as a whole, or as to the effect of other Federal or local statutes.

An employer who adopts the amended form of the plan after the date of the
amendment should apply for a determination letter by filing an application with
the Key District Director of Internal Revenue Service on Form 5307, Short Form
Application for Determination for Employee Benefit Plan.

This letter with respect to the amendment to the form of the plan does not
affect the applicability to the plan of the continued, interim and extended
reliance provisions of sections 13 and 17.03 of Rev. Proc. 89-9, 1989-1 C.B.
780. The applicability of such provisions may be determined by reference to the
initial opinion letter with respect to the plan.

If you, the sponsoring organization, have any questions concerning the IRS
processing of this case, please call the above telephone number. This number is
only for use of the sponsoring organization. Individual participants and/or
adopting employers with questions concerning the plan should contact the
sponsoring organization. The plan's adoption agreement must include the
sponsoring organization's address and telephone number for inquiries by adopting
employers.

You should keep this letter as a permanent record. Please notify us if you
modify or discontinue sponsorship of this plan.

Sincerely yours,

Chief, Employee Plans Qualifications Branch

<PAGE> 1
EXHIBIT 21.1

E3 CORPORATION
LIST OF SUBSIDIARIES

E3 France SA
E3 Italia S.R.L.
E3 Norden AB
E3 (Deutschland) GmbH
E3 North America, Inc.
E3 International Limited
E3 United Kingdom Limited
Inventory Management Institute, Inc.

<PAGE> 1

EXHIBIT 23.1

CONSENT OF INDEPENDENT AUDITORS

We consent to the reference to our firm under the captions "Selected
Consolidated Financial Data" and "Experts" and to the use of our report, dated
February 13, 1998, except for Note 9, as to which the date is May 14, 1998, in
the Registration Statement (Form S-1 No. 333-______) and related Prospectus of
E3 Corporation.

/s/ Ernst & Young LLP

Ernst & Young LLP

Atlanta, Georgia
June 3, 1998

<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AND STATEMENT OF INCOME AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FORM S-1.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS

<S> <C> <C>
<PERIOD-TYPE> YEAR 3-MOS
<FISCAL-YEAR-END> DEC-31-1997 DEC-31-1998
<PERIOD-START> JAN-01-1997 JAN-01-1998
<PERIOD-END> DEC-31-1997 MAR-31-1998
<EXCHANGE-RATE> 1 1
<CASH> 7,318 9,248
<SECURITIES> 0 0
<RECEIVABLES> 7,076 5,876
<ALLOWANCES> 590 590
<INVENTORY> 0 0
<CURRENT-ASSETS> 14,529 15,157
<PP&E> 2,783 2,932
<DEPRECIATION> 1,525 1,660
<TOTAL-ASSETS> 15,824 16,519
<CURRENT-LIABILITIES> 8,955 8,839
<BONDS> 0 0
0 0
0 0
<COMMON> 782 782
<OTHER-SE> 6,056 6,868
<TOTAL-LIABILITY-AND-EQUITY> 15,824 16,519
<SALES> 24,861 7,499
<TOTAL-REVENUES> 24,861 7,499
<CGS> 0 0
<TOTAL-COSTS> 21,189 5,992
<OTHER-EXPENSES> 39 53
<LOSS-PROVISION> 400 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> 3,833 1,514
<INCOME-TAX> 1,575 621
<INCOME-CONTINUING> 2,258 893
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 2,258 893
<EPS-PRIMARY> .14 .06
<EPS-DILUTED> .14 .06

</TABLE>