On May 15, 2000, the plaintiffs in the Consolidated Amended Complaint filed a Notice of Dismissal and the case was voluntarily dismissed without prejudice. Another purported class action against Day Runner was also voluntarily dismissed on May 26, 2000.

The Complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10-b(5). Specifically, the Complaint alleges that during the Class Period, defendants, among other things, materially misrepresented the financial condition of Day Runner by disseminating to the investment community false and misleading financial statements for the 1999 fiscal reporting period. It is further alleged that these financial statements were deceptive and failed to conform with both mandatory Securities and Exchange Commission ("SEC") guidelines and Generally Accepted Accounting Procedures ("GAAP") and that the Company had improperly recorded revenues and earnings for fiscal year 1999 due to improper accounting of manufacturing variances and other costs.