EXHIBIT INDEX
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Exhibit No. Exhibit Description
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99.1 Explanation of Responses
EXHIBIT 99.1
(1) As of January 28, 2005, the Reporting Person and the Issuer entered
into a settlement agreement, and other related agreements, pursuant to
which, among other things:
(i) 4,389,000 shares of Common Stock of the Issuer jointly owned
by the Reporting Person and his spouse, and 649,000 shares of
Common Stock of the Issuer held in the name of Ofir Holding
Limited, a company in which the Reporting Person shares
ownership (collectively, the "Shares"), were sold for an
aggregate purchase price of $170,000 (the "Purchase Price").
The Purchase Price was negotiated as part of the overall
settlement agreement between the Issuer and the Reporting
Person, and, therefore, does not necessarily represent the
market value of the Shares on the date of the transaction;
(ii) Stock Options to purchase 1,750,000 shares of Common Stock of
the Issuer, at an exercise price of $.01 per share, and Stock
Options to purchase 90,000 shares of Common Stock of the
Issuer, at an exercise price of $.001 per share, which had
previously been granted to the Reporting Person by the Issuer
in connection with services provided, and to be provided, by
the Reporting Person to the Issuer, were terminated; and
(iii) Stock Options to purchase 1,093,750 shares of Common Stock of
the Issuer, at an exercise price of $.01 per share, and Stock
Options to purchase 90,000 shares of Common Stock of the
Issuer, at an exercise price of $.001 per share (collectively,
the "New Options"), were granted to the Reporting Person to
replace certain options that had previously vested. All of the
New Options vested immediately upon their grant.
(2) These shares were held in the name of Ofir Holding Limited, a company
in which the Reporting Person shares ownership.
(3) As of the date of their cancelation, 1,093,750 of these options were
exercisable. 218,750 additional options would have vested on each of
March 31, 2005, June 30, 2005 and September 30, 2005.
(4) These options had been granted to the Reporting Person by the Issuer in
connection with services provided, and to be provided, by the Reporting
Person to the Issuer.