Table of Contents 1 - Solutions 2 - Financial Highlights 3 - To Our Shareholders 4 - Annual Value 5 - Unique Position 6 - Industry Leaders Validation 7 - Investment Opportunity | E-Bussiness Solutions 8 - Customer Benefits | Competitions 9 - Process Industry Expertise | Internet Affect 10 - Future Growth | Vision for Future 11 - Contact Information Financials Section___________ I - Discuss/Analysis of Financial Condition & Results of Ops II - Consolidated Statements of Operations III - Consolidated Balance Sheets IV - Consolidated Statements of Cash Flows V - Statements of Stockholders’ Equity & Income VI - Notes to Consolidated Financial Statements VI.1 - Operations VI.2 - Significant Account Policies VI.3 - Restructuring and Other Changes VI.4 - Acquiisitions VI.5 - Line of Credit VI.6 - Long-Term Obligations VI.7 - 5¼% Convertible Subordinated Debentures VI.8 - Preffered Stock VI.9 - Common Stock VI.10 - Income Taxes VI.11 - Operating Leases VI.12 - Sale of Installments Receivable VI.13 - Commitments and Contingencies VI.14 - Retirement and Profit Sharing Plants VI.15 - Joint Ventures and Other Investments VI.16 - Accurued Expenses VI.17 - Related Party Transactions VI.18 - Segment and Geographic Information VII - Report of Independent Public Accountants Success Stories Section_____ Success Stories - BP Success Stories - BORDEN Success Stories - ROHM and HAAS Success Stories - DOW Success Stories - UNION CARBIDE Success Stories - PETRO VANTAGE Consolidated Statements of Stockholders’ Equity and Comprehensive Income (Loss) In Thousands, Except Share Data Common Stock Additional Retained Earnings Accumulated Other Treasury Stock     Number of Shares $.10 Par Value Paid-In Capital (Accumulated Deficit) Compre- hensive Income (Loss) Number of Shares Cost Total Stock- holders’ Equity Compre- hensive Income (Loss)                     Balance, June 30, 1997 24,983,500 $2,499 $128,083 $7,954 $(270) 230,330 $(502) $137,764   Issuance of common stock in immaterial poolings 766,443 77 2,046 (7,321) — — — (5,198)   Issuance of common stock under employee stock purchase plans 115,617 11 3,867 — — — — 3,878   Exercise of stock options and warrants 525,830 53 7,194 — — — — 7,247   ESOP contribution 983,145 98 380 — — — — 478   Dividends paid — — — (384) — — — (384)   Retired stock (3,693) (1) (1) — — — — (2)   Translation adjustment, not tax effected — — — — 98 — — 98 $98 Unrealized market loss on investments, net of $31 tax effect — — — — (47) — — (47) (47) Tax benefit related to stock options — — 6,512 — — — — 6,512   Net income — — — 16,211 — — — 16,211 16,211 Comprehensive net income for the year ended June 30, 1998                 $16,262 Balance, June 30, 1998 27,370,842 2,737 148,081 16,460 (219) 230,330 (502) 166,557   Issuance of common stock in an immaterial pooling 45,000 5 443 (444) — — — 4   Issuance of common stock under employee stock purchase plans 267,324 27 4,371 — — — — 4,398   Exercise of stock options and warrants 123,986 12 901 — — — — 913   Purchase of treasury stock — — — — — 100 — —   Dividends paid — — — (3,957) — — — (3,957)   Translation adjustment, not tax effected — — — — (1,574) — — (1,574) (1,574) Unrealized market loss on investments, net of $135 tax effect — — — — (219) — — (219) (219) Tax benefit related to stock options — — 423 — — — — 423   Net loss — — — (20,795) — — — (20,795) (20,795) Comprehensive net loss for the year ended June 30, 1999                 $(22,588) Balance, June 30, 1999 27,807,152 2,781 154,219 (8,736) (2,012) 230,430 (502) 145,750   Issuance of common stock under employee stock purchase plans 384,864 38 3,822 — — — — 3,860   Exercise of stock options 868,412 87 7,773 — — — — 7,860   Dividends paid — — — (444) — — — (444)   Translation adjustment, not tax effected — — — — (904) — — (904) (904) Unrealized market loss on investments, net of $90 tax effect — — — — (129) — — (129) (129) Tax benefit related to stock options — — 7,777 — — — — 7,777   Net income — — — 5,428 — — — 5,428 5,428 Comprehensive net income for the year ended June 30, 2000                 $4,395 Balance, June 30, 2000 29,060,428 $2,906 $173,591 $(3,752) $(3,045) 230,430 $(502) $169,198   The accompanying notes are an integral part of these consolidated financial statements. Table of Contents 1 - Solutions 2 - Financial Highlights 3 - To Our Shareholders 4 - Annual Value 5 - Unique Position 6 - Industry Leaders Validation 7 - Investment Opportunity | E-Bussiness Solutions 8 - Customer Benefits | Competitions 9 - Process Industry Expertise | Internet Affect 10 - Future Growth | Vision for Future 11 - Contact Information Financials Section___________ I - Discuss/Analysis of Financial Condition & Results of Ops II - Consolidated Statements of Operations III - Consolidated Balance Sheets IV - Consolidated Statements of Cash Flows V - Statements of Stockholders’ Equity & Income VI - Notes to Consolidated Financial Statements VI.1 - Operations VI.2 - Significant Account Policies VI.3 - Restructuring and Other Changes VI.4 - Acquiisitions VI.5 - Line of Credit VI.6 - Long-Term Obligations VI.7 - 5¼% Convertible Subordinated Debentures VI.8 - Preffered Stock VI.9 - Common Stock VI.10 - Income Taxes VI.11 - Operating Leases VI.12 - Sale of Installments Receivable VI.13 - Commitments and Contingencies VI.14 - Retirement and Profit Sharing Plants VI.15 - Joint Ventures and Other Investments VI.16 - Accurued Expenses VI.17 - Related Party Transactions VI.18 - Segment and Geographic Information VII - Report of Independent Public Accountants Success Stories Section_____ Success Stories - BP Success Stories - BORDEN Success Stories - ROHM and HAAS Success Stories - DOW Success Stories - UNION CARBIDE Success Stories - PETRO VANTAGE