10th Anniversary Creation of Activist Short-Selling

Today, June 27, 2006 marks the Tenth Anniversary of the first ever publication of a research report by a National Association of Securities Dealers (“NASD”) member firm or any other professional organization advocating that investors avoid the purchase of a certain stock due to serious questions about management’s representation and conduct.

On this day in 1996 Asensio & Company, Inc., then an Securities and Exchange Commission (“SEC”) and NASD member firm, responded to an appearance on CNBC’s “Squawk Box” television show by Diana Corporation’s (“Diana”) Chief Executive Officer (“CEO”) with a press release and publication of a research report on the then brand-new Internet. Diana was one of Wall Street’s first darling Internet bubble stock. In the CNBC appearance Diana’s CEO hyped its technology and profit potential.

The first activist short selling reports, issued by Asensio shortly after Diana’s CNBC appearance, criticized the company, its products and CEO, and revealed the CEO as a serial stock promoter with a long list of failed schemes, and also proved Diana’s product to be fatally flawed. The stock fell rapidly and steadily from its high of $125 price at the time of commencement of Asensio’s activist short selling campaign, to zero when it filed for bankruptcy.