ITEM 2

     At the Annual Meeting there will be presented to stockholders a proposal to approve an amendment to the Company’s Amended and Restated Certificate of Incorporation to decrease the number of shares of Common Stock authorized for issuance to 35 million shares. The Company’s Amended and Restated Certificate of Incorporation currently authorizes the issuance of 75 million shares of Common Stock, par value $0.001 per share.

     As of April 17, 2009, approximately 9,942,140 shares of our common stock were issued and outstanding (excluding 18,361 treasury shares) and approximately 1,433,732 shares were reserved for issuance upon the exercise of outstanding options granted under our various stock-based plans. Accordingly, approximately 63,624,128 shares of common stock are available for future issuance.

     Our Board of Directors has adopted resolutions setting forth the proposed amendment to Article FOURTH of the Company’s Amended and Restated Certificate of Incorporation, subject to approval of the Company’s stockholders at the Annual Meeting.

     The following is the text of Article FOURTH of the Amended and Restated Certificate of Incorporation of the Company, as proposed to be amended:

     “FOURTH: The total number of shares of stock which the Corporation shall have authority to issue is 36,000,000 shares, divided into two classes as follows: (i) 1,000,000 shares of Preferred Stock, par value $1.00 per share (“Preferred Stock”); and (ii) 35,000,000 shares of Common Stock, par value $.001 per share (“Common Stock”).”

     Purpose and Effect of the Proposed Amendment

     Under current economic circumstances, the Board of Directors believes that it is unlikely that the Company will need shares for stock splits or stock dividends in the near future, or that the Company will use a significant number of shares to make acquisitions or raise equity capital.

     Franchise taxes imposed by the State of Delaware are partly a function of the number of shares of stock authorized by our Amended and Restated Certificate of Incorporation. We have determined that reducing our authorized shares by 40 million shares will not impede our operations or goals, and, based on current rates, will result in annual savings of franchise taxes of approximately $35,000. Consistent with our company-wide program of cost reductions, the Board of Directors believes that this expense reduction is appropriate.

     If the proposed amendment is adopted, it will become effective upon filing of a Certificate of Amendment to the Company’s Amended and Restated Certificate of Incorporation with the Delaware Secretary of State. However, the Board retains discretion under Delaware law not to implement the proposed amendment even if it is approved by stockholders. If the Board exercised such discretion, the number of authorized shares would remain at the current level.

     Other than the reduction in the annual Delaware franchise taxes, there are no material tax or accounting consequences of the proposed reduction in the number of authorized shares of common stock.

     The affirmative vote of a majority of the common stock outstanding and entitled to vote at the Annual Meeting is required to approve the amendment to our Amended and Restated Certificate of Incorporation to effect the proposed decrease in our authorized shares of common stock.

     THE BOARD OF DIRECTORS RECOMMENDS A VOTE TO APPROVE THE AMENDMENT TO OUR AMENDED AND RESTATED CERTIFICATE OF INCORPORATION, AND PROXIES SOLICITED BY THE BOARD WILL BE VOTED IN FAVOR OF THE AMENDMENT UNLESS A STOCKHOLDER INDICATES OTHERWISE ON THE PROXY.