NETWORK-1 TECHNOLOGIES, INC. — Director's Dealing 2004

Apr 15, 2004

SEC Form 4 — Statement of Changes in Beneficial Ownership

Issuer: NETWORK 1 SECURITY SOLUTIONS INC (NSSI.PK)
CIK: 0001065078
Period of Report: 2004-04-13

Reporting Person: CMH CAPITAL MANAGEMENT CORP (10% Owner)

Non-Derivative Transactions

Date	Security	Code	Shares	Price	A/D	Holdings After	Ownership
2004-04-13	Common Stock, $.01 par value per share	J	2712337	—	Acquired	2867800	Direct

Derivative Transactions

Date	Security	Exercise Price	Code	Shares	A/D	Expiration	Underlying	Ownership
2004-04-13	Series E Convertible Preferred Stock	$0.0000	J	1084935	Disposed		Common Stock, $.01 par value per share (2169870)	Direct

Footnotes

F1: Pursuant to an Exchange Agreement, dated April 13, 2004, by and among the Issuer and all the holders of the Issuer's outstanding Series D and Series E Preferred Stock, the holders of such Preferred Stock agreed to exchange their shares of Preferred Stock for shares of Common Stock. In accordance with the Exchange Agreement, holders of Preferred Stock received 1.25 times the number of shares of Common Stock for each share of Common Stock that they would have received based upon the conversion rate of their Preferred Stock.

F2: Issued in exchange for Series E Preferred Stock.

F3: Under the terms of the Certificate of Designations, Preferences and Other Rights and Qualifications of Series E Convertible Preferred Stock of the Issuer, each share of Series E Convertilbe Preferred Stock was convertible at any time into two (2) shares of Common Stock.

F4: The Series E Convertible Preferred Shares were convertible upon issuance. No additional payment was required for the conversion.

F5: The Series E Convertible Preferred Shares did not have an expiration date.