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INTELLICALL ANNOUNCES TENTATIVE SETTLEMENT OF STOCKHOLDER LAWSUIT

 DALLAS, Feb. 2 /PRNewswire/ -- Intellicall, Inc. (NYSE: ICL) announced today that it has reached an agreement in principle to settle its stockholder class action litigation.
 The company and certain of its officers were sued by stockholders in April and May 1991, alleging, among other things, that the company failed to adequately disclose certain alleged improper sales practices. In April 1992, the plaintiffs amended the complaint to include claims based on allegations that the company failed to disclose timely that it had been in violation of its loan agreements.
 The settlement agreement provides for complete releases of the company, certain of its officers and directors, and certain third parties who were also sued. The company does not admit any wrongdoing in connection with the settlement.
 Terms of the settlement include payment of $1 million in cash, a $900,000 promissory note payable on Sept. 30, 1994, and issuance of $6.1 million of new shares of the company's common stock. The cash portion of the settlement will be funded out of the company's existing operations and credit facilities.
 The number of new shares of common stock will range from a minimum of 750,000 to a maximum of 1,340,000, and will be determined by the average closing price of the company's common stock on the New York Stock Exchange during the 20 business days prior to court approval of the settlement. If the closing price of the company's common stock averages less than $4.55 per share during the valuation period, the company will be required to increase the value of the promissory note to maintain the total settlement value at $8 million.
 The agreement is subject to execution of mutually acceptable settlement papers, approval by the court and the company's board of directors and the consent of the company's lenders. The company would expect the closing to take place in approximately three to four months.
 William O. Hunt, chairman, president and chief executive officer of the company, said: "We felt it was important to settle this litigation so we could concentrate our efforts on returning the company to profitability. We are pleased that we could put the lawsuit behind us with a net reduction in the equity accounts of no more than $2 million, assuming the average stock price remains above $4.55. We believe the dilution from the increased shares should be acceptable to existing shareholders."
 The company stated that it will accrue the expense of the settlement agreement in the fourth quarter of 1992. Without regard to the settlement expense, the company had previously announced that it expects to report a loss for the fourth quarter of 1992 and for the year as a whole.
 Intellicall, Inc. is a diversified telecommunications company providing innovative technology and services to private pay telephone networks throughout the United States, and is the nation's leading manufacturer of privately owned pay telephones, automated operator systems and call processing systems. The company's common stock is traded on the New York Stock Exchange under the symbol ICL and is listed in alphabetical quotations as Intellicall or Intelcal.
 -0- 2/2/93
 /CONTACT: Clyde Hopkins of Hopkins & Associates, Inc., 214-754-0990, for Intellicall, Inc./
 (ICL)


CO: Intellicall, Inc. ST: Texas IN: TLS SU:

WB -- NY093 -- 1999 02/02/93 15:06 EST
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Publication:PR Newswire
Date:Feb 2, 1993
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