MILBERG WEISS BERSHAD
HYNES & LERACH LLP
ALAN SCHULMAN (128661)
JAMES A. CAPUTO (120485)
TRAVIS E. DOWNS, III (148274)
TOR GRONBORG (179109)
600 West Broadway, Suite 1800
San Diego, CA 92101
Telephone: 619/231-1058
Attorneys for Plaintiffs

I, JAMES A. CAPUTO, declare as follows:

1. I am a partner in the law firm of Milberg Weiss Bershad Hynes & Lerach LLP, counsel of record for plaintiffs in the above-captioned action. I make this declaration in support of Plaintiffs' Opposition to Defendants' Motion to Enforce Mandatory Discovery Stay of the Private Securities Litigation Reform Act of 1995. I have personal knowledge of the facts set forth herein and if called to testify in this matter, I could and would testify competently thereto.

2. Attached as exhibits to this declaration are true and correct copies of the following documents:

Exhibit 1: Defendants' Memorandum re: Plaintiffs' Motion for Appointment as Lead Plaintiffs and Lead Plaintiffs' Counsel in Head, et al. v. NetManage, Inc., et al., Case No. C-97-20061-JW (N.D. Cal. 1997);

Exhibit 2: Order Granting Plaintiffs' Motion to be Appointed Lead Plaintiffs Pursuant to §21D(a)(3)(B) of the Securities Exchange Act of 1934 and for Appointment of Lead Plaintiffs' Lead Counsel in Head, et al. v. NetManage, Inc., et al., Case No. C-97-20061-JW (N.D. Cal. May 14, 1997);

Exhibit 3: Judge Flaherty's Order Denying Motion to Stay Merits Discovery in Werczberger v. StorMedia, Inc., No. CV760825 (Santa Clara Super. Ct. Dec. 31, 1996);

Exhibit 4: Judge Marshall's Order Denying Motion to Stay Proceedings in Thompson v. Veterinary Centers of America, No. BC168547 (Los Angeles Super. Ct. July 21, 1997);

Exhibit 5: Judge Stone's Order Denying Defendants' Motion for Determination that Action Not Proceed as a Class Action in Head, et al. v. NetManage, Inc., et al., No. CV763295 (Santa Clara Super. Ct. May 30, 1997);

Exhibit 6: Judge Turrone's Order on Demurrer to and Motion to Strike Portions of the Complaint in Head, et al. v. NetManage, Inc., et al., No. CV763295 (Santa Clara Super. Ct. July 15, 1997);

Exhibit 7: Judge Levinger's Order Denying Defendants' Motion to Stay Discovery in Head, et al. v. NetManage, Inc., et al., No. CV763295 (Santa Clara Super. Ct. July 31, 1997);

Exhibit 8: Order Denying Defendants' Petition for Writ of Mandate or Other Appropriate Relief in NetManage, Inc., et al. v. Superior Court, No. H017259 (Sept. 23, 1997);

Exhibit 9: H.R. 1689, 105th Cong. (1997);

Exhibit 10: 141 Cong. Rec. H. 2818 (March 8, 1995)

Exhibit 11: Hearings before the Subcommittee on Telecommunications and Finance of the House of Representatives Commerce Committee, Serial No. 104-2, 104th Cong. 1st Sess. (1995);

Exhibit 12: 141 Cong. Rec. S. 9319 (June 28, 1995);

Exhibit 13: Richard A. Frymire, et al. v. Peat, Marwick, Mitchell & Co., No. 85 C 10460 (N.D. Ill. June 16, 1987); and

Exhibit 14: H.R. Rep. No. 104-369, 109 Stat. 679 (1995).

3. A telephonic hearing in Head, et al. v. NetManage, Inc., et al, No. CV763295 (Santa Clara Super. Ct.) was heard on September 4, 1997 before James E. Towery. The Court appointed Mr. Towery on July 31, 1997 to serve as Discovery Master in the state matter. During the hearing, the Discovery Master considered plaintiffs' Motion to Compel Deposition of NetManage, Inc. and Motion to Compel Production of Documents Against Arthur Andersen LLP. Discovery Master Towery recommended that both motions be granted and that the parties confer regarding commencing the depositions and production of relevant documents. In addition, the Discovery Master recommended that plaintiffs' proposed protective order, which permitted dissemination of state court discovery between plaintiffs and their counsel in both federal and California courts, be entered subject to procedural guarantees that confidentiality be maintained in all actions.

4. In trying to resolve these discovery disputes with defendants, plaintiffs offered to stay the federal proceeding during the pendency of the state case. Defendants stated they would consider plaintiffs' proposal. They have not yet responded regarding plaintiffs' stay proposal.

I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Executed this 26th day of September, 1997, at San Diego, California.

NETMANAG\SLA02564.DEC

I, the undersigned, declare:

1. That declarant is and was, at all times herein mentioned, a citizen of the United States and a resident of the County of San Diego, over the age of 18 years, and not a party to or interested in the within action; that declarant's business address is 600 West Broadway, Suite 1800, San Diego, California 92101.

2. That on September 26, 1997, declarant served the DECLARATION OF JAMES A. CAPUTO IN SUPPORT OF PLAINTIFFS' OPPOSITION TO DEFENDANTS' MOTION TO ENFORCE THE MANDATORY DISCOVERY STAY OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 by depositing a true copy thereof in a United States mailbox at San Diego, California in a sealed envelope with postage thereon fully prepaid and addressed to the parties listed on the attached Service List and that this document was forwarded to the following designated Internet site at:

http://securities.milberg.com

3. That there is a regular communication by mail between the place of mailing and the places so addressed.

I declare under penalty of perjury that the foregoing is true and correct. Executed this 26th day of September 1997, at San Diego, California.