Date: Thu, 18 Dec 1997 10:06:29 GMT Server: Stronghold/1.3 Ben-SSL/1.3 Apache/1.1.1 Content-type: text/html Content-length: 3484 Last-modified: Tue, 07 Oct 1997 19:57:38 GMT
Released by Loring Group of Johnnie D. Johnson & Co., Inc.
50 Broad Street, NYC 10004 -- (212) 943-0620
For Immediate Release
SETTLEMENT REACHED IN TEXAS LAWSUIT
PHOENIX, Ariz., July 3, 1997 -- Frontier Adjusters of America, Inc. (ASE-FAJ) announced today that it and Mark Brockbank and Alan Bird, individually and on behalf of certain underwriters at Lloyds, London, have settled and have entered into an agreement resolving all outstanding issues, including the withdrawal of all allegations and claims made against Frontier in a Texas lawsuit.
Under the agreement, Messrs. Brockbank and Bird have agreed to withdraw their allegations and claims in the lawsuit and Frontier has agreed to make a payment to Messrs. Brockbank and Bird. The settlement will cost the Company $525,000 net of insurance reimbursement. The payment is in consideration for the agreement and for the resolution of the litigation between the parties. The Company anticipates that this settlement will result in a decrease of approximately $320,000 in net income after taxes, equal to 7 cents per share, for the fiscal year ended June 30, 1997.
"We have entered into this agreement because it will put an end to the considerable disruption and expense that results from ongoing litigation as well as to the continuing uncertainty of outcome surrounding any litigation," said William J. Rocke, Chief Executive Officer. "We can now devote all our resources and energies to the Company and its business. We believe this best reflects the long-term interests of the Company, its shareholders, and its franchisees and licensees."
Frontier Adjusters of America, Inc. licenses and franchises independent claims adjusters throughout North America, with more than 650 advertised locations at present in 50 states, the District of Columbia and Canada. The Company also owns and operates independent insurance adjusting businesses in Arizona and Nevada.
This press release includes statements with respect to the possible effect on net income of the settlement of the Texas litigation that may constitute forward looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from the forward looking statements. Factors that would cause or contribute to such differences include, but are not limited to, finalization of the preparation of the Company's financial statement for the year ended June 30, 1997 and general economic conditions.
For information at Frontier contact:
William J. Rocke, Chief Executive Officer and Chairman of the Board
(602) 264-1061