On May 24, 1999, District Court for the Eastern District of Michigan approved the settlement of the class action lawsuit filed against Data Systems Network. The complaints alleged violations of the Securities Exchange Act of 1934 resulting from alleged nondisclosures and misrepresentations of information concerning the Company's financial results and future prospects due to accounting irregularities. A settlement fund was established to benefit a class of purchasers who bought the Company's stock during the period of May 16, 1996 through February 24, 1998. The fund included $900,000 provided by the Company's insurer and 650,000 shares of the Company's common stock, which the Company issued on June 22, 1999.