By the Order and Final Judgment dated October 22, 2001, the settlement is approved and the action is dismissed with prejudice. Further, the Plan of Allocation is approved and Plaintiffs’ Counsel is awarded the sun of $377,824.32 as attorneys’ fees and $15,983.67 in reimbursement of expenses.

The original lawsuit charges Anika and certain of its officers, with violations of the federal securities laws by issuing materially false and misleading financial statements for the Company's 1998 fiscal year and the first three quarters of 1999. On March 15, 2000 Anika announced that, after an informal inquiry by the Securities and Exchange Commission ("SEC"), Anika would restate its previously reported financial results for fiscal year 1998 and the first three quarters of 1999 due to improperly recording revenue. Further, on May 30, 2000, Anika revealed that the SEC commenced a formal investigation into Anika's accounting practices. Following this announcement, Anika's common stock plunged 66 percent to $2 1/2 per share on May 31, 2000. On August 7, 2000, Plaintiffs filed motions to appoint lead plaintiff and lead counsel. On September 13, 2000, the Court granted Plaintiffs' motion and appointed Lead Plaintiff and Berman DeValerio & Pease LLP as Lead Counsel for the class. By the same Order, all related cases have been consolidated. Plaintiffs filed their Consolidated Amended Complaint on October 30, 2000 and defendants responded on December 14, 2000 by filing a Motion to Dismiss the complaint. Both parties fully briefed the issues. On May 25, 2001, after arms-length negotiations, the parties agreed to settle the action and filed a Stipulation and Agreement of Compromise with the Court. Pursuant to the terms of the Stipulation, a Settlement Fund in the amount of $1,250,000, plus interest, has been established for the benefit of the Class. The terms of the settlement were preliminarily approved by Order of the Court entered on May 31, 2001. A Final Approval Hearing, to determine whether the proposed settlement is fair, reasonable and adequate, is scheduled for August 8, 2001.