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TALX Agrees to Settlement in Class-Action Lawsuits
ST. LOUIS --(Business Wire)-- May 5, 2004 -- TALX Corporation (NASDAQ:TALX) said it reached an agreement to settle all pending class action lawsuits related to financial disclosures and statements made from July 20, 2000, through November 14, 2002, including in connection with a secondary offering in 2001.
The settlement calls for payment of $5.75 million, which will be made by TALX's insurance carriers and will not impact earnings. There will be approximately $500,000 of additional legal costs which will be included in expenses for the fourth quarter of the fiscal year ended March 31, 2004.
The agreement is subject to certain conditions, including judicial approval, and a potential additional payment depending on the amount of certain claims. TALX believes that any such payment is unlikely, but if required, would not be material.
TALX denied the claims in the litigation, and the settlement provides that TALX does not admit any liability. Although TALX was prepared to vigorously defend the litigation, William W. Canfield, president and chief executive officer of TALX, said the company decided to settle in order to put the litigation behind it. "We have conducted a detailed review of our financial statements, and although certain items were reclassified or restated, there was no change in the fundamentals of the company. Even so, we decided to settle these lawsuits so that management could focus its full attention on significant growth initiatives, including a recent major acquisition and new cross-selling opportunities," Canfield said.
TALX Corporation is a leading business process outsourcer of payroll data-centric services. Based in St. Louis, Missouri, TALX holds a leadership position in two key employment-related services -- automated employment and income verification services via The Work Number and unemployment cost management services via UC eXpress. TALX also provides paperless payroll services, W-2 services and automated time entry and approval services. The company's common stock trades on the NASDAQ Stock Market under the symbol TALX. For more information about TALX Corporation, call 314-214-7000 or access the company's Web site at www.talx.com.
Statements expressed or implied in this news release regarding our expectation of the likelihood of the consummation of the settlement, and the possibility of an additional settlement payment, are forward-looking statements. These statements reflect our current views and are based on assumptions and subject to risks and uncertainties, which may cause actual results or events to be materially different from those expressed or implied by such statements. These risks include, but are not limited to (1) the possibility that the court will not approve the settlement, (2) the possibility that claimants request exclusion from the settlement who hold a larger than anticipated number of shares of our common stock, and (3) the potential inaccuracy of the analysis on which the Company relied as to the amount of certain claims, and the possibility that a larger-than-expected amount of certain claims is submitted. We do not undertake any obligation or plan to update these forward-looking statements, even though our situation may change.
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