According to PSS World Medical Inc.'s 10-K For the Fiscal Year Ended April 2, 1999, on May 14, 1999, the United States Court of Appeals for the 5th Circuit dismissed the Krupnik case with prejudice. On May 24, 1999 the United States District Court for the Southern District of Mississippi, Jackson Division, dismissed the Klein case with prejudice.

As summarized by PSS World Medical Inc.'s FORM 10-Q for the quarterly period ended December 31, 1998, on August 21, 1998, the court filed an Order dismissing all the allegations in the Krupnick action. That case is presently on appeal to the United States Court of Appeals for the 5th Circuit. The same Order also dismissed the claims against Defendants Hixon, Piper, Tibbitts, Pritchard, Bayer, and Gulf South under section 12(2) of the Securities Act and corresponding claims against Defendants Hixon and Gulf South under section 15 of the Securities Act and Miss.Code Ann. Sections 75-71-717(a)(2) and 75-71-719 in the Klein action. Plaintiffs' claims under section 11 of the Securities Act remain pending in the Klein case.

Previously, according to the same SEC filing, Gulf South and certain of its current and former officers and directors, among others, are named as defendants in two purported securities class action lawsuits entitled Ernest Klein v. Gulf South Medical Supply, Inc., et al., Civil Action No. 3:97cv526WS, and Ann Krupnick v. Gulf South Medical Supply, Inc., et al., Civil Action No. 3:97cv525BN. Both actions, which were filed on July 21, 1997, are pending in the United States District Court for the Southern District of Mississippi, Jackson Division. The plaintiff in the Klein action alleges, for himself and for a purported class of similarly situated stockholders who allegedly purchased stock in Gulf South's June 1996 public offering of its common stock, that the defendants engaged in violations of certain provisions of the Securities Act of 1933, as amended ("Securites Act"), and Mississippi state law. The plaintiff in the Krupnick action alleges for herself and for a purported class of similarly situated stockholders who allegedly purchased Gulf South Common Stock between May 2, 1996 and July 22, 1996, that the defendants engaged in certain violations of the Exchange Act, Rule 10b-5 promulgated thereunder and Mississippi state law. Plaintiffs allege that the defendants artificially inflated the price of Gulf South stock by representing that Gulf South was "well positioned" to grow by increasing its sales to existing customers, including one of its largest customers Living Centers of America, after defendants had been informed by Living Centers that its distribution arrangement with Gulf South was being terminated in favor of a rival medical supply distributor.

The complaint alleges that Gulf South and certain of its officers, directors and its securities underwriters violated the Securities Act of 1933 and Mississippi state law. The complaint alleges that, in connection with Gulf South's $130 million 1996 public offering, the defendants issued false and misleading statements, representing that the company was successfully eliminating duplicative overhead costs associated with its recent acquisitions and was successfully executing its growth strategy, which included increased sales to existing customers. The complaint alleges that defendants' representations enabled Gulf South and its insiders to raise almost $130 million from plaintiff and the class through the sale of Gulf South common stock. The complaint further alleges that six weeks after the offering was completed, the defendants revealed that Living Centers of America had previously confirmed that it would be terminating its distribution arrangement with Gulf South.