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<SEC-DOCUMENT>0000884144-09-000016.txt : 20091210
<SEC-HEADER>0000884144-09-000016.hdr.sgml : 20091210
<ACCEPTANCE-DATETIME>20091210164946
ACCESSION NUMBER:		0000884144-09-000016
CONFORMED SUBMISSION TYPE:	DEFA14A
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20091210
DATE AS OF CHANGE:		20091210
EFFECTIVENESS DATE:		20091210

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			FORGENT NETWORKS  INC
		CENTRAL INDEX KEY:			0000884144
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373]
		IRS NUMBER:				742415696
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		DEFA14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-34522
		FILM NUMBER:		091234181

	BUSINESS ADDRESS:	
		STREET 1:		108 WILD BASIN RD
		CITY:			AUSTIN
		STATE:			TX
		ZIP:			78746
		BUSINESS PHONE:		5124372700

	MAIL ADDRESS:	
		STREET 1:		108 WILD BASIN RD
		CITY:			AUSTIN
		STATE:			TX
		ZIP:			78746

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	VTEL CORP
		DATE OF NAME CHANGE:	19960401

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	VIDEO TELECOM CORP
		DATE OF NAME CHANGE:	19960401
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEFA14A
<SEQUENCE>1
<FILENAME>asur20091210defa14a.htm
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>UNITED STATES</TITLE>
<META NAME="author" CONTENT="Adrian P.">
<META NAME="date" CONTENT="12/10/2009">
</HEAD>
<BODY style="font-family:Times New Roman; font-size:10pt; color:#000000">
<DIV style="width:576px"><P style="margin:0px" align=center><B>UNITED STATES</B></P>
<P style="margin:0px" align=center><B>&nbsp;SECURITIES AND EXCHANGE COMMISSION</B></P>
<P style="margin:0px" align=center><B>&nbsp;Washington, D.C. 20549</B></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><B>SCHEDULE&nbsp;14A</B></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center>Proxy Statement Pursuant to Section&nbsp;14(a) of</P>
<P style="margin:0px" align=center>&nbsp;the Securities Exchange Act of 1934 (Amendment No.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;)</P>
</DIV><TABLE style="font-size:10pt" cellspacing=0><TR height=0 style="font-size:0"><TD width=29.133></TD><TD width=26.933></TD><TD width=521.8></TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px">Filed by the Registrant&nbsp;&nbsp;<FONT style="font-family:Wingdings">x</FONT></P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px">Filed by a Party other than the Registrant&nbsp;&nbsp;<FONT style="font-family:Wingdings">o</FONT></P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px">Check the appropriate box:</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px; font-family:Wingdings">o </P>
</TD><TD valign=top width=548.733 colspan=2><P style="margin:0px">Preliminary Proxy Statement</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px; font-family:Wingdings">o</P>
</TD><TD valign=top width=548.733 colspan=2><P style="margin:0px"><B>Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))</B></P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px; font-family:Wingdings">o</P>
</TD><TD valign=top width=548.733 colspan=2><P style="margin:0px">Definitive Proxy Statement</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px; font-family:Wingdings">x</P>
</TD><TD valign=top width=548.733 colspan=2><P style="margin:0px">Definitive Additional Materials</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px; font-family:Wingdings">o</P>
</TD><TD valign=top width=548.733 colspan=2><P style="margin:0px">Soliciting Material Pursuant to &#167;240.14a-12</P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px" align=center>&nbsp;</P>
</TD></TR>
<TR><TD style="border-bottom:1.333px solid #000000" valign=top width=577.867 colspan=3><P style="margin:0px" align=center>Forgent Networks, Inc.</P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px" align=center>(Name of Registrant as Specified In Its Charter)</P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px" align=center>&nbsp;</P>
</TD></TR>
<TR><TD style="border-bottom:1.333px solid #000000" valign=top width=577.867 colspan=3><P style="margin:0px" align=center>Not Applicable</P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px" align=center>(Name of Person(s) Filing Proxy Statement, if other than the Registrant)</P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=577.867 colspan=3><P style="margin:0px">Payment of Filing Fee (Check the appropriate box):</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px; font-family:Wingdings">x</P>
</TD><TD valign=top width=548.733 colspan=2><P style="margin:0px">No fee required.</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px; font-family:Wingdings">o</P>
</TD><TD valign=top width=548.733 colspan=2><P style="margin:0px">Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">(1)</P>
</TD><TD valign=top width=521.8><P style="margin:0px">Title of each class of securities to which transaction applies:</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:1.333px solid #000000" valign=top width=521.8><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">(2)</P>
</TD><TD valign=top width=521.8><P style="margin:0px">Aggregate number of securities to which transaction applies:</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:1.333px solid #000000" valign=top width=521.8><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">(3)</P>
</TD><TD valign=top width=521.8><P style="margin:0px">Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:1.333px solid #000000" valign=top width=521.8><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">(4)</P>
</TD><TD valign=top width=521.8><P style="margin:0px">Proposed maximum aggregate value of transaction:</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:1.333px solid #000000" valign=top width=521.8><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">(5)</P>
</TD><TD valign=top width=521.8><P style="margin:0px">Total fee paid:</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=26.933><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:1.333px solid #000000" valign=top width=521.8><P style="margin:0px">&nbsp;</P>
</TD></TR>
</TABLE>
<DIV style="width:576px"><P style="margin:0px"><BR></P>
<P style="margin:0px">* Set forth the amount on which the filing fee is calculated and state how it was determined.</P>
<P style="margin:0px">&nbsp;</P>
</DIV><TABLE style="font-size:10pt" cellspacing=0><TR height=0 style="font-size:0"><TD width=29.133></TD><TD width=25.2></TD><TD width=523.533></TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px; font-family:Wingdings">o</P>
</TD><TD valign=top width=548.733 colspan=2><P style="margin:0px">Fee paid previously with preliminary materials.</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px; font-family:Wingdings">o</P>
</TD><TD valign=top width=548.733 colspan=2><P style="margin:0px">Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=25.2><P style="margin:0px">(1)</P>
</TD><TD valign=top width=523.533><P style="margin:0px">Amount Previously Paid:</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=25.2><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:1.333px solid #000000" valign=top width=523.533><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=25.2><P style="margin:0px">(2)</P>
</TD><TD valign=top width=523.533><P style="margin:0px">Form, Schedule or Registration Statement No.:</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=25.2><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:1.333px solid #000000" valign=top width=523.533><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=25.2><P style="margin:0px">(3)</P>
</TD><TD valign=top width=523.533><P style="margin:0px">Filing Party:</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=25.2><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:1.333px solid #000000" valign=top width=523.533><P style="margin:0px">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=29.133><P style="margin:0px">&nbsp;</P>
</TD><TD valign=top width=25.2><P style="margin:0px">(4)</P>
</TD><TD valign=top width=523.533><P style="margin:0px">Date Filed:</P>
</TD></TR>
<TR><TD style="border-bottom:3px solid #000000" valign=top width=29.133><P>&nbsp;</P></TD><TD style="border-bottom:3px solid #000000" valign=top width=25.2><P style="margin:0px">&nbsp;</P>
</TD><TD style="border-bottom:3px solid #000000" valign=top width=523.533><P style="margin:0px">&nbsp;</P>
</TD></TR>
</TABLE>
<DIV style="width:576px"><P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px; font-size:12pt" align=center>1</P>
<P style="margin:0px"><BR></P>
</DIV><DIV style="width:624px"><P style="margin:0px; font-size:12pt; page-break-before:always"><B>Asure Software Announces 1Q 2010 Financial Results</B></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; font-size:12pt"><B>Austin, Texas, December 9, 2009.</B> &nbsp;Asure Software (NASDAQ: ASUR), a leading provider of workforce management software, today announced financial results for the Fiscal 2010 first quarter, ended October 31, 2009. </P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; font-size:12pt"><B>Q1 Highlights</B>: </P>
<P style="margin:0px"><BR></P>
<TABLE style="margin:0px; width:48px; font-family:Symbol; font-size:12pt; clear:left" align=left border=0 style=border-collapse:collapse cellpadding=0 cellspacing=0><TD style="padding-left:24px">&#183;</TD></TABLE>
<P style="margin:0px; padding-left:48px; text-indent:-2px; font-size:12pt">As expected, revenue declined 4% vs. the previous quarter to $2.3M. &nbsp;iEmployee's revenue grew 3% compared to Q4 &#145;09, driven largely by growth in clock sales, which grew 41% over Q4 &#146;09. &nbsp;Additionally, iEmployee posted record new bookings in Q1 &#146;10, a 69% improvement over Q4 &#146;09. &nbsp;&nbsp;NetSimplicity's revenue declined 12% vs. the previous quarter. &nbsp;This drop was anticipated as we transition the business from a perpetual license model to a SaaS model. &nbsp;Importantly, NetSim&#146;s SaaS revenue component grew 10% over Q4 &#146;09.</P>
<P style="margin:0px"><BR></P>
<TABLE style="margin:0px; width:48px; font-family:Symbol; font-size:12pt; clear:left" align=left border=0 style=border-collapse:collapse cellpadding=0 cellspacing=0><TD style="padding-left:24px">&#183;</TD></TABLE>
<P style="margin:0px; padding-left:48px; text-indent:-2px; font-size:12pt">Operating expenses decreased in Q1 2010 versus Q4 2009 by ($4.0M), (55%), due to both a significant decline in one-time costs, ($3.3M) and operational efficiency, ($0.7M). &nbsp;Q1 &#146;10 one-time costs were driven by final proxy contest charges and severance expenses. &nbsp;Operational efficiencies were realized in many areas, with the most significant being in Compensation. &nbsp;The full effect of recent reductions in force drove $0.5M in reduced operating expenses in Q1 &#146;10.</P>
<P style="margin:0px"><BR></P>
<TABLE style="margin:0px; width:48px; font-family:Symbol; font-size:12pt; clear:left" align=left border=0 style=border-collapse:collapse cellpadding=0 cellspacing=0><TD style="padding-left:24px">&#183;</TD></TABLE>
<P style="margin:0px; padding-left:48px; text-indent:-2px; font-size:12pt">Q1 &#146;10 was EBITDA neutral, excluding one-time costs of $1.1M and excess net lease expense of $0.1M.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; font-size:12pt">Pat Goepel, Asure&#146;s Chief Executive Officer remarked &#147;We will see a new Asure rise in 2010; we have drastically reduced operating costs and will put negative one-time events behind us as we move forward. &nbsp;The upcoming short period for November and December, 2009 will yield similar levels of adjusted EBITDA and going forward the only anticipated one-time costs will be in the form of investments to further enhance our products and services and improve operational efficiency. &nbsp;By calendar Q1, 2010, we expect to begin seeing the benefits of our growth plan and along with our normalized lower cost structure, expect to be EBITDA positive.&#148; &nbsp;</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; font-size:12pt">&#147;Furthermore,&#133;&#148; continued Goepel, &#147;&#133;Asure is committed to reducing exposure to our Austin Headquarters lease arrangement which can only accelerate our plan to become profitable for the calendar year 2010. &nbsp;We continue to believe that our business and assets are undervalued and we wish to inform shareholders that we presently have 1.2M shares available under our current stock buyback plan and we intend to be active in the near future.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; font-size:12pt">Chairman of the Board, David Sandberg, added, &#147;Lastly, in one week&#146;s time we have an important Annual Meeting where we are asking shareholders to approve several proposals. &nbsp;Among these are non-routine votes seeking ratification of a 10-for-1 reverse split in order to retain our Nasdaq listing, a rights plan to protect our $150+ million in tax </P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; font-size:12pt; page-break-before:always">loss carryforwards, and an equity plan to facilitate the granting of options as part of a new compensation plan to our employees given we have ended the furlough period but are retaining salaries at furlough levels. &nbsp;I represent the largest shareholder of the Company and I believe these proposals are the right moves for the Company and are in the shareholders&#146; best interests as we strive for value creation. &nbsp;For these reasons, I ask each shareholder to consider and vote in support of each of our proposals if you agree, and to do so in time for next week&#146;s meeting. &nbsp;If you have not yet done so, please contact our proxy solicitor, InvestorCom, Inc., at (203) 972-9300.&#148;</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; font-size:11pt"><B>Conference Call Details </B></P>
<P style="margin-top:6.133px; margin-bottom:6.133px; font-size:11pt">AUSTIN, TX--(Marketwire - 11/20/09) - Asure Software (NASDAQ:<FONT style="color:#0000FF"><U>ASUR</U></FONT> - <FONT style="color:#0000FF"><U>News</U></FONT>), a leading provider of workforce management software, today announced that it will release the results of its 2010 first quarter, ended October 31, 2009 on Thursday, December 10, 2009. Asure Software has scheduled a conference call for Thursday, December 10, 2009 at 11:00 a.m. ET (10:00 a.m. CT) to discuss its most recent financial results and outlook. Participating in the call will be Pat Goepel, Chief Executive Officer and David Sandberg, Chairman of the Board.</P>
<P style="margin-top:6.133px; margin-bottom:6.133px; font-size:11pt">To take part, please dial &nbsp;800-901-5217&nbsp;ten minutes before the conference call begins, ask for the Asure Software event and use passcode 23171971. International callers should 617-786-2964 and reference the same passcode, 23171971.</P>
<P style="margin-top:6.133px; margin-bottom:6.133px; font-size:11pt">Investors, analysts, media and the general public will also have the opportunity to listen to the conference call in listen-only mode via the Internet by visiting the investor relations page of Asure's web site at <FONT style="color:#0000FF"><U>www.asuresoftware.com</U></FONT>. To monitor the live call, please visit the web site at least 15 minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, an archived replay will be available shortly after the call on the investor relations page of the Company's web site at <FONT style="color:#0000FF"><U>www.asuresoftware.com</U></FONT>.</P>
<P style="margin:6.133px" align=center><BR></P>
<P style="margin-top:6.133px; margin-bottom:6.133px; font-size:11pt" align=center>&nbsp;<B>About Asure Software</B></P>
<P style="margin-top:6.133px; margin-bottom:6.133px; font-size:11pt">Headquartered in Austin, Texas, Asure Software (ASUR), (a d/b/a of Forgent Networks, Inc.), empowers small to mid-size organizations and divisions of large enterprises to operate more efficiently, increase worker productivity and reduce costs through a comprehensive suite of on-demand workforce management software and services. Asure's market-leading suite includes products that optimize workforce time and attendance tracking, benefits enrollment and tracking, pay stubs and W2 documentation, and meeting and event management. With additional offices in Warwick, Rhode Island, Vancouver, British Columbia, and Mumbai, India, Asure serves 3,500 customers around the world. For more information, please visit www.asuresoftware.com. SOURCE: Asure Software</P>
<P style="margin:0px" align=center><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; font-size:12pt; page-break-before:always" align=center><B>FORGENT NETWORKS, INC.</B></P>
<P style="margin:0px; font-size:12pt" align=center><B>CONDENSED CONSOLIDATED BALANCE SHEETS<A NAME="condensedconsolidatedbalanceshee"></A></B></P>
<P style="margin:0px; font-size:12pt" align=center>(Amounts in thousands, except per share data)</P>
</DIV><TABLE style="font-size:10pt" cellspacing=0><TR height=0 style="font-size:0"><TD width=487.733></TD><TD width=15.733></TD><TD width=20></TD><TD width=5.933></TD><TD width=75.933></TD><TD width=15.733></TD><TD width=22.4></TD><TD width=72.8></TD><TD width=15.733></TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:8pt" align=center><B>OCTOBER&nbsp;31,</B></P>
<P style="margin:0px; font-size:8pt" align=center><B>&nbsp;2009</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:8pt" align=center><B>JULY&nbsp;31,</B></P>
<P style="margin:0px; font-size:8pt" align=center><B>&nbsp;2009</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:8pt" align=center><B>(UNAUDITED)</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>ASSETS</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">Current Assets:</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Cash and equivalents</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=25.933 colspan=2><P style="margin:0px; font-size:12pt">$</P>
</TD><TD valign=top width=75.933><P style="margin:0px; font-size:12pt" align=right>1,651</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=22.4><P style="margin:0px; font-size:12pt">$</P>
</TD><TD valign=top width=72.8><P style="margin:0px; font-size:12pt" align=right>4,375</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Short-term investments</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>1,303</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>5,339</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Accounts receivable, net of allowance for doubtful accounts of $17 and $20 at October&nbsp;31, 2009 and July&nbsp;31, 2009, respectively</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>1,576</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>1,207</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Inventory</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>31</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>3</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Prepaid expenses and other current assets</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>274</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>143</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:58.667px; text-indent:-14.667px; font-size:12pt"><B>Total Current Assets</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right><B>4,835</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>11,067</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">Property and equipment, net</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>625</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>672</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">Intangible assets, net</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>3,753</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>3,949</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:110.667px; text-indent:-14.667px; font-size:1pt"><B>&nbsp;</B><FONT style="font-size:12pt"><B>Total Assets</B></FONT></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=25.933 colspan=2><P style="margin:0px; font-size:12pt"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=75.933><P style="margin:0px; font-size:12pt" align=right><B>9,213</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=22.4><P style="margin:0px; font-size:12pt"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=72.8><P style="margin:0px; font-size:12pt" align=right><B>15,688</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=top width=487.733><P>&nbsp;</P></TD><TD valign=top width=15.733><P>&nbsp;</P></TD><TD valign=top width=101.867 colspan=3><P>&nbsp;</P></TD><TD style="border-top:3px double #000000" valign=top width=15.733><P>&nbsp;</P></TD><TD valign=top width=95.2 colspan=2><P>&nbsp;</P></TD><TD valign=top width=15.733><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>LIABILITIES AND STOCKHOLDERS&#146; EQUITY</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">Current Liabilities:</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Accounts payable</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=25.933 colspan=2><P style="margin:0px; font-size:12pt">$</P>
</TD><TD valign=top width=75.933><P style="margin:0px; font-size:12pt" align=right>1,601</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=22.4><P style="margin:0px; font-size:12pt">$</P>
</TD><TD valign=top width=72.8><P style="margin:0px; font-size:12pt" align=right>6,294</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Accrued compensation and benefits</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>188</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>278</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Lease impairment and advance</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>709</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>899</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Other accrued liabilities</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>439</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>541</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Deferred revenue</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>1,826</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>1,897</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:58.667px; text-indent:-14.667px; font-size:12pt"><B>Total Current Liabilities</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right><B>4,763</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>9,909</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">Long-Term Liabilities:</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Deferred revenue</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>120</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>119</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Lease impairment and advance</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>210</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>250</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Other long-term obligations</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>219</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>206</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:62.667px; text-indent:-14.667px; font-size:12pt"><B>Total Long-Term Liabilities</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right><B>549</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>575</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:12pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right><B>&nbsp;</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:12pt"><B>&nbsp;</B></P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>&nbsp;</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:12pt"><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">Stockholders&#146; Equity:</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Preferred stock, $.01 par value; 10,000 shares authorized; none issued or outstanding</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>&#151;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>&#151;</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Common stock, $.01 par value; 40,000 shares authorized; 33,406 and 32,906 shares issued; 31,616 and 31,116 shares outstanding at October&nbsp;31, 2009 and July&nbsp;31, 2009, respectively</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>334</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>329</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Treasury stock at cost, 1,790 shares at October&nbsp;31, 2009 and July&nbsp;31, 2009</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>(4,815)</P>
</TD><TD valign=top width=15.733><P>&nbsp;</P></TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>(4,815)</P>
</TD><TD valign=top width=15.733><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Additional paid-in capital</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>270,915</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>270,738</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Accumulated deficit</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>(262,453)</P>
</TD><TD valign=top width=15.733><P>&nbsp;</P></TD><TD valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>(260,947)</P>
</TD><TD valign=top width=15.733><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Accumulated other comprehensive income</P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right>(80)</P>
</TD><TD valign=top width=15.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right>(101)</P>
</TD><TD valign=top width=15.733><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:62.667px; text-indent:-14.667px; font-size:12pt"><B>Total Stockholders&#146; Equity</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=101.867 colspan=3><P style="margin:0px; font-size:12pt" align=right><B>3,896</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=95.2 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>5,204</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=top width=487.733><P style="margin:0px; padding-left:110.667px; text-indent:-14.667px; font-size:12pt"><B>Total Liabilities and Stockholders&#146; Equity</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=20><P style="margin:0px; font-size:12pt"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=81.867 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>9,213</B></P>
</TD><TD valign=top width=15.733><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=22.4><P style="margin:0px; font-size:12pt"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=72.8><P style="margin:0px; font-size:12pt" align=right><B>15,688</B></P>
</TD><TD valign=top width=15.733><P>&nbsp;</P></TD></TR>
</TABLE>
<DIV style="width:624px"><P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px; font-size:8pt" align=center>&nbsp;</P>
<P style="margin:0px; font-size:12pt" align=center><B>FORGENT NETWORKS, INC.</B></P>
<P style="margin:0px; font-size:12pt" align=center><B>CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS</B></P>
<P style="margin:0px; font-size:12pt" align=center>(Amounts in thousands, except per share data)</P>
</DIV><TABLE style="font-size:10pt" cellspacing=0><TR height=0 style="font-size:0"><TD width=506.533></TD><TD width=13.533></TD><TD width=18.533></TD><TD width=68.733></TD><TD width=18.533></TD><TD width=18.533></TD><TD width=68.467></TD><TD width=7.067></TD></TR>
<TR><TD valign=bottom width=506.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=192.8 colspan=5><P style="margin:0px; font-size:8pt" align=center><B>FOR&nbsp;THE&nbsp;THREE</B></P>
<P style="margin:0px; font-size:8pt" align=center><B>&nbsp;MONTHS&nbsp;ENDED</B></P>
<P style="margin:0px; font-size:8pt" align=center><B>&nbsp;OCTOBER&nbsp;31,</B></P>
</TD><TD valign=bottom width=7.067><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=bottom width=506.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:8pt" align=center><B>2009</B></P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=87 colspan=2><P style="margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=7.067><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=bottom width=506.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD><TD valign=bottom width=192.8 colspan=5><P style="margin:0px; font-size:8pt" align=center><B>(UNAUDITED)</B></P>
</TD><TD valign=bottom width=7.067><P style="margin:0px; font-size:1pt" align=center><B>&nbsp;</B></P>
</TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">Revenues</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:12pt">$</P>
</TD><TD valign=bottom width=68.733><P style="margin:0px; font-size:12pt" align=right>2,321</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:12pt">$</P>
</TD><TD valign=bottom width=68.467><P style="margin:0px; font-size:12pt" align=right>2,792</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">Cost of Sales</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>(479)</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>(564)</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt"><B>Gross Margin</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>1,842</B></P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>2,228</B></P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>OPERATING EXPENSES:</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Selling, general and administrative</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>2,741</P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>3,197</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Research and development</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>411</P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>561</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Amortization of intangible assets</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>149</P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>149</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:44px; text-indent:-14.667px; font-size:12pt"><B>Total Operating Expenses</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>3,301</B></P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>3,907</B></P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>LOSS FROM OPERATIONS</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>(1,459)</B></P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>(1,679)</B></P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>OTHER INCOME AND (EXPENSES):</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Interest income</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>7</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>55</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Foreign currency translation</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>(31)</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>120</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Interest expense and other</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>(11)</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>(10)</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:44px; text-indent:-14.667px; font-size:12pt"><B>Total Other Income</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>(36)</B></P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>165</B></P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>LOSS FROM OPERATIONS, BEFORE INCOME TAXES</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>(1,494)</B></P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right><B>(1,514)</B></P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Provision for income taxes</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>(12)</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>(25)</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>NET LOSS</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:12pt"><B>$</B></P>
</TD><TD valign=bottom width=68.733><P style="margin:0px; font-size:12pt" align=right><B>(1,506)</B></P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:12pt"><B>$</B></P>
</TD><TD valign=bottom width=68.467><P style="margin:0px; font-size:12pt" align=right><B>(1,539)</B></P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:12pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>BASIC AND DILUTED LOSS PER SHARE:</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:1pt" align=right><FONT style="background-color:#FFFF00">&nbsp;</FONT></P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Net loss per share - basic and diluted</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:12pt">$</P>
</TD><TD valign=bottom width=68.733><P style="margin:0px; font-size:12pt" align=right>(0.05)</P>
</TD><TD valign=bottom width=18.533><P>&nbsp;</P></TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:12pt">$</P>
</TD><TD valign=bottom width=68.467><P style="margin:0px; font-size:12pt" align=right>(0.05)</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:14.667px; text-indent:-14.667px; font-size:12pt"><B>WEIGHTED AVERAGE SHARES OUTSTANDING:</B></P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:1pt" align=right><FONT style="background-color:#FFFF00">&nbsp;</FONT></P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:1pt" align=right>&nbsp;</P>
</TD><TD valign=bottom width=7.067><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Basic</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>31,317</P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>31,104</P>
</TD><TD valign=bottom width=7.067><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
<TR><TD valign=top width=506.533><P style="margin:0px; padding-left:29.333px; text-indent:-14.667px; font-size:12pt">Diluted</P>
</TD><TD valign=bottom width=13.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87.267 colspan=2><P style="margin:0px; font-size:12pt" align=right>31,317</P>
</TD><TD valign=bottom width=18.533><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD><TD valign=bottom width=87 colspan=2><P style="margin:0px; font-size:12pt" align=right>31,104</P>
</TD><TD valign=bottom width=7.067><P style="margin:0px; font-size:1pt">&nbsp;</P>
</TD></TR>
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<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px"><B>Important Information</B></P>
<P style="margin:0px">&nbsp;</P>
<P style="margin:0px">Forgent Networks,&nbsp;Inc. filed a definitive Proxy Statement with the Securities and Exchange Commission on November 25, 2009, in connection with Company&#146;s Annual Meeting of Stockholders to be held on December 17, 2009.&nbsp; <B>Stockholders are strongly advised to read the Proxy Statement carefully, as it contains important information.</B>&nbsp; The Company and certain other persons are deemed participants in the solicitation of proxies from stockholders in connection with the Annual Meeting of Stockholders. Information concerning such participants is available in the Company&#146;s Proxy Statement.&nbsp; Stockholders may obtain, free of charge, copies of the Company&#146;s Proxy Statement and any other documents the Company files with or furnishes to the Securities and Exchange Commission in connection with the Annual Meeting of Stockholders through the Securities and Exchange Commission&#146;s website at www.sec.gov and through the Company&#146;s website at www.asuresoftware.
com.</P>
<P style="margin:0px">&nbsp;</P>
<P style="margin:0px">&#147;Safe Harbor&#148; Statement under the Private Securities Litigation Reform Act of 1995:</P>
<P style="margin:0px">&nbsp;</P>
<P style="margin:0px">Statements in this press release regarding Asure&#146;s business which are not historical facts are &#147;forward-looking statements&#148; that involve risks and uncertainties. Such risks and uncertainties, which include those associated with continued listing of the Company&#146;s securities on the NASDAQ Capital Market, could cause actual results to differ from those contained in the forward-looking statements.</P>
<P style="margin:0px">&nbsp;</P>
<P style="margin:0px">Contact Information:</P>
<P style="margin:0px">&nbsp;</P>
<P style="margin:0px">Lisa Flynn, Asure Software: 512-437-2678</P>
<P style="margin:0px"><BR></P>
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