According to the firm's 10-K dated 10/27/1998, on January 12, 1998, the Company announced that it had reached an agreement in principle settling the Shareholder Securities Class Action ("Lawsuit") filed against the Company and certain of its officers in March 1997. The settlement, which was approved by the Court on June 15, 1998, resulted in the distribution of $1,350,000 minus approved attorney's fees and related expenses, to purchasers of the Company's common stock in the Company's initial public offering, and during the period of November 26, 1996 to February 13, 1997. The entire $1,350,000 cash settlement was paid by the Company's insurance
carrier. The settlement included a release of all claims that were asserted or
that could have been asserted in the Lawsuit against the Company and its
officers and directors. The Company agreed to the settlement solely to avoid the expense, burdens and uncertainties of further litigation and continues to deny that it has any liability on account of the matters asserted in the litigation or that the Plaintiffs' claims have merit.