As reported by the firm's FORM 10-KSB for the fiscal year ended June 30, 1999, on July 2, 1996, the Company had a class action lawsuit filed against it by shareholders. The class action was brought on behalf of all persons and entities who purchased shares of common stock from May 13, 1996 to June 27, 1996. In April 1999, the lawsuit was settled with the Company agreeing to pay $170,631 for shareholder losses and associated legal fees. The $170,631 liability has been accrued in the accompanying financial statements as of June 30, 1999.
According to the Order of Dismissal with Prejudice entered on July 19, 1999, all claims, defenses, and causes of action asserted in the action by Plaintiffs as against Defendants, and all related affirmative defenses, may be dismissed with prejudice. Each party shall bear its own costs and attorneys' fees incurred herein.
The original complaint charges IAS and its President with violations of the federal securities laws. Plaintiff specifically alleges that defendants artificially inflated the price of IAS common stock by issuing false and misleading statements regarding the company's introduction of a purportedly new and revolutionary communications technology called Digital Wave Modulation.