In April 2003, the Company entered into a three-year consulting agreement for
advisory and other services related to the marketing, distribution and sale of
its products. The term of the agreement is from April 23, 2003 through April 22,
2006. The agreement obligates the Company to pay the consultant an aggregate of
$3.0 million in cash as follows: $750,000 in 2003, $1,000,000 in both 2004 and
2005, and $250,000 in 2006. Additionally, the agreement requires the Company to
issue 66,667 shares of its common stock annually as directed by the consultant
in 2003, 2004 and 2005. At September 30, 2003, the Company has paid an aggregate
of $675,000 pursuant to the contract but has not issued any shares of its common
stock.
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