The Unknown Appraiser in Financial Statements

2001--As described in Note 5, the Company holds common and preferred stock holdings in My Other Company, Inc. ("MOC"). As a result of operating losses and declining cash flows at MOC, combined with adverse market changes, the Company concluded that MOC's estimated future earnings and cash flows would not allow recovery of the carrying value of the Company's investments. This loss in value was considered an "other than temporary" impairment condition; accordingly, the carrying values of the investments were written down by $28,600,000 during the fourth quarter of 2001. The loss includes a write-down of the common stock and junior preferred stock values to zero, and a write-down of the senior preferred stock to approximately $11,500,000. The amount of the write-down was based on the valuation of the common, and junior and senior preferred stocks, as conducted by an independent valuation firm. Accepted valuation practices were utilized in determining these investments' fair values, including the market and income approaches, discounted cash flow method, and market yield analysis. The valuation considered the Company's minority position, the illiquidity of these types of investments in the public market, the ability of future cash flows to fund future debt and preferred obligations, and sugar industry conditions. The Company has no current plans to divest or sell its investments in MOC.

In March 1999, the Company agreed to issue to three key executives a total of 2,030,580 shares of common stock. While the Company agreed to issue the shares in March 1999, the actual grant did not occur until September 1999. These stock awards vest one third commencing on the date of issue and ratably thereafter, on a quarterly basis, through June 30, 2002. Based on an independent appraisal of the fair value of the shares granted, the Company will recognize compensation expense of $180,000 over the vesting period, of which $78,462 was recognized during the nine month period ended September 30, 1999 and $18,462 was recognized during the six month period ended March 31, 2000.

During the year ended December 31, 1999 and 1998, in connection with the grant of certain share options, MyWeb recorded as deferred stock compensation of $2,608,000 and $1,859,000 respectively. Such amounts represented the difference between the exercise price and the deemed fair market value of MyWeb's ordinary share on the date such stock options were granted. Such amount is being amortized based on an accelerated method over the vesting period of the options, generally four years. In 1999 and 1998, MyWeb recorded amortization of deferred stock compensation expense of approximately $2,142,000 and $221,000 respectively. At December 31, 1999, MyWeb had a total of $2,104,000 remaining to be amortized.

ACQUISITION

On November 4, 1999, the Company acquired substantially all of the assets of The Gridiron Company LLC ("Gridiron"), a development stage company engaged in design and development of radio frequency and microwave fiber-optic equipment for cellular and PCS (personal communication services), satellite communications and related markets. The purchase consideration consisted of $754,000 cash and 573,334 shares of the Company's common stock valued at $10.59 per share.

The transaction was recorded using the purchase method of accounting and the results of Gridiron have been included in the Company's financial statements subsequent to November 4, 1999. The allocation of the purchase price to the tangible and identifiable intangible assets acquired in connection with this acquisition was based on estimated fair values as determined by management as follows (in thousands):

The amortization of goodwill and acquired workforce is being computed over seven and three years respectively on the straight-line basis. The Company also recognized a pre-tax charge to operations of $2.3 million for the purchase of acquired in-process research and development. This charge was computed using the excess earnings method of the income approach, discounting the future debt free cash-flows at 30% to reflect the weighted average cost of capital and the specific ratios associated with each in-process product.