1]   On July 8, 2016, Mirror Worlds Technologies, LLC, the Company's wholly-owned subsidiary, entered into a settlement agreement with Apple Inc. ("Apple") in connection with litigation in the United States District Court for the Eastern District of Texas, for infringement of the Company's '227 Patent (see Note K[2] hereof).  Under the terms of the settlement agreement, Apple received a fully paid-up non-exclusive license to the '227 Patent for its full term (which expired in June 2016), along with certain rights to other patents in the Company's portfolio.  The Company received $25 million from Apple for the settlement and fully paid-up license.

[2]   On July 8, 2016, the Company entered into settlement agreements with Alcatel-Lucent USA and Alcatel-Lucent Holdings Inc. (collectively "Alcatel") as well as ALE, USA with respect to the pending litigation in the United States District Court for the Eastern District of Texas, for infringement of the Company's Remote Power Patent (see Note K[3] hereof).  Under the terms of the settlements, Alcatel and ALE received fully-paid licenses to the Remote Power Patent for its full term which expires in March 2020.  The aggregate consideration to be received by the Company for the fully paid licenses is $4,300,000, of which $2,300,000 is payable in the three equal quarterly payments contingent upon a ruling to be issued by the U.S. District Court of Texas with respect to a pending motion finding any asserted claim of the Remote Power Patent is valid.

[3]   On July 14, 2016, the Company entered into a new employment agreement ("Agreement") with its Chairman and Chief Executive Officer pursuant to which he continues to serve the Company in such positions for a five year term, at an annual base salary of $475,000 which shall be increased by 3% per annum during the term of the Agreement.  The Agreement established an annual target bonus of $175,000 for the Chairman and Chief Executive Officer based upon performance.  The Agreement also provides that the Chairman and Chief Executive Officer will continue to receive substantially the same Incentive Compensation as contained in his prior employment agreement (5% of the Company's gross royalties and other payments with respect to the Company's Remote Power Patent and with respect to all other patents the greater of (i) 10% net interest (after all expenses including legal fees) or (ii) 6.25 % gross interest.  (See Note J[1] hereof). In addition, the Company granted to the Chairman and Chief Executive Officer, under its 2013 Stock Incentive Plan, 750,000 performance based restricted stock units (the "RSUs") which vest in three tranches, as follows: (i) 250,000 RSUs shall vest on July 14, 2018, subject to Mr. Horowitz's continued employment by the Company through the vesting date (the "Employment Condition"); (ii) 250,000 RSUs shall vest at any time beginning July 14, 2018 through July 14, 2021 in equal annual installments for the remaining term of employment, subject to (1) the Employment Condition being satisfied through each such annual vesting date and (2) the Company's common stock achieving a closing price (for 20 consecutive trading days) of a minimum of $3.25 per share (subject to adjustment for stock splits) at any time during the term of employment; and (iii) 250,000 RSUs vest at any time beginning July 14, 2018 through July 14, 2021 in equal annual installments for the remaining term of employment subject to (1) the Employment Condition being satisfied through each such annual vesting date and (2) the Company's common stock achieving a closing price (for 20 consecutive trading days) of a minimum of $4.25 per share (subject to adjustment for stock splits) at any time during the term of employment. Notwithstanding the aforementioned, in the event of a Change of Control (as defined), a Termination Other Than for Cause (as defined), or a termination of employment by the Chairman and Chief Executive Officer for Good Reason (as defined), all of the 750,000 RSUs shall accelerate and become immediately fully vested.  All of the aforementioned RSUs issued to the Company's Chairman and Chief Executive Officer have dividend equivalent rights.

[4]   On July 26, 2016, the Company entered into a settlement agreement with Dell, Inc. with respect to the pending litigation in the United States District Court for the Eastern District of Texas, for infringement of the Company's Remote Power Patent (see Note K[2] hereof).  Under the terms of the settlement, Dell will license the Remote Power Patent for its full term (which expires in March 2020) and pay to the Company a license initiation fee of $6,000,000 and ongoing royalties based on its sales of PoE products.