<table>
<tbody><tr style="font-size:1px">
<td width="5%" valign="TOP">
<p>&nbsp;</p>
</td>
<td width="95%" valign="TOP">
<p>&nbsp;</p>
</td>
</tr>
<tr>
<td valign="TOP">
<p><font size="2">(5)</font></p>
</td>
<td valign="TOP">
<p><font size="2"><u>Stockholders’ Equity
  (Continued)</u></font></p>
</td>
</tr>
<tr>
<td valign="TOP">
<p><font size="1">&nbsp;</font></p>
</td>
<td valign="TOP">
<p><font size="1">&nbsp;</font></p>
</td>
</tr>
<tr>
<td valign="TOP">
<p><font size="1">&nbsp;</font></p>
</td>
<td valign="TOP">
<p><font size="2">(iii) <u>Restricted Stock
  (continued)</u></font></p>
</td>
</tr>
<tr>
<td valign="TOP">
<p><font size="1">&nbsp;</font></p>
</td>
<td valign="TOP">
<p><font size="1">&nbsp;</font></p>
</td>
</tr>
<tr>
<td valign="TOP">
<p><font size="1">&nbsp;</font></p>
</td>
<td valign="TOP">
<p align="justify"><font size="2">On October 9, 2006,
  pursuant to a Restricted Stock Agreement and as approved by the Company’s
  Board of Directors, the Company awarded 200,000 shares of common stock to its
  newly appointed President and Chief Executive Officer.  Such shares were not issued under the
  Company’s 2002 Plan.  The fair value
  of these shares was determined by the market price of the Company’s common
  stock on the date of grant.  The value
  of the shares at the grant date amounted to approximately $380,000. The
  shares will vest in one installment on October&nbsp;9, 2011 provided the
  recipient is then employed by the Company.
  In addition, as set forth in the Restricted Stock Agreement, the
  shares will be subject to earlier incremental vesting to the extent the Company’s
  shares of common stock trade above specified thresholds for a minimum period
  of 20 consecutive trading days during the term of his employment with the
  Company.  The accelerated vesting will
  occur as follows:  </font></p>
</td>
</tr>
</tbody></table>
<table>
<tbody><tr>
<td>
<p> </p>
</td>
<td>
<p> </p>
</td>
</tr>
<tr>
<td>
<p><font>(5)</font></p>
</td>
<td>
<p><font><u>Stockholders’ Equity
  (Continued)</u></font></p>
</td>
</tr>
<tr>
<td>
<p><font> </font></p>
</td>
<td>
<p><font> </font></p>
</td>
</tr>
<tr>
<td>
<p><font> </font></p>
</td>
<td>
<p><font>(iii) <u>Restricted Stock
  (continued)</u></font></p>
</td>
</tr>
<tr>
<td>
<p><font> </font></p>
</td>
<td>
<p><font> </font></p>
</td>
</tr>
<tr>
<td>
<p><font> </font></p>
</td>
<td>
<p><font>On October 9, 2006,
  pursuant to a Restricted Stock Agreement and as approved by the Company’s
  Board of Directors, the Company awarded 200,000 shares of common stock to its
  newly appointed President and Chief Executive Officer.  Such shares were not issued under the
  Company’s 2002 Plan.  The fair value
  of these shares was determined by the market price of the Company’s common
  stock on the date of grant.  The value
  of the shares at the grant date amounted to approximately $380,000. The
  shares will vest in one installment on October 9, 2011 provided the
  recipient is then employed by the Company.
  In addition, as set forth in the Restricted Stock Agreement, the
  shares will be subject to earlier incremental vesting to the extent the Company’s
  shares of common stock trade above specified thresholds for a minimum period
  of 20 consecutive trading days during the term of his employment with the
  Company.  The accelerated vesting will
  occur as follows:  </font></p>
</td>
</tr>
</tbody></table>