Global Intellicom, Inc. Announces Lawsuit Alleging Market Manipulation and Illegal Profit Taking in Global Stock
NEW YORK, Jan. 22 /PRNewswire/ -- Global Intellicom, Inc. (OTC Bulletin Board: GBIT) announced that the Company has filed a lawsuit in the U.S. Federal District Court in Manhattan, seeking damages and other remedies for an alleged fraudulent scheme to artificially depress the market price of the Company's common stock.
In the suit the Company asserts, among other things, that the defendants -- who include entities holding various series of the Company's convertible preferred shares and individuals affiliated with those entities -- purchased the preferred shares as part of an illegal scheme and conspiracy which involved manipulative short-selling of the Company's common stock.
This alleged scheme of market manipulation commenced in early 1998, artificially depressing the market price of the Company's common stock and reducing its market capitalization. In addition to damages, the Company seeks, among other things, a declaration that it has no further conversion obligations under the convertible preferred shares.
The Company also claims that various of the preferred shareholders beneficially own 10% or more of the Company's common stock, thus triggering reporting obligations with which they have not complied and entitling the Company to, among other things, disgorgement of all short-swing profits.
The defendants named in the suit are Thomas Kernaghan & Co., Bronia GmbH, Augustine Fund, L.P., Sovereign Partners, L.P., Atlantis-Capital Fund, Ltd., Mark Valentine, Stephen Hicks, JNC Opportunity Fund, Ltd., Encore Capital Management, L.L.C., Neil T. Chau, James A. Skalko, Frederick A. Lenz, Spratt Family Trust, James W. Spratt III, and Susan M. Spratt.
Global Intellicom, Inc. is a systems integration Company with state-of-the-art network cabling and computer integration capabilities, located in New York City, Pittsburgh and Exton, Pennsylvania, and Washington D.C. Global also functions as a value-added reseller of network services and PC's. Global holds reseller licenses with such companies as Microsoft, IBM, NEC, Toshiba, 3Com, Compaq and Hewlett-Packard. Its clients include Lockheed Martin, Loral Systems, EDS and the Department of Defense and the General Services Administration. Through the aggregate use of Global Intellicom's resources, its mission is to be the information technology resource of choice for its customers, and to offer them a "total system solution" at competitive rates.
Except for the historical information contained herein, the matters set forth in this press release are forward-looking statements within the meaning of "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties, including the risks of partially or completely adverse decisions inherent in any litigation and the risks of collecting on judgment that may cause actual results to differ materially from those anticipated. Such risks are discussed in the Company's filing with the Securities and Exchange Commission, including the Company's recent registration statement on Form S-3. These forward-looking statements speak only as of the date hereof, and the Company disclaims any obligation to update these forward-looking statements.
SOURCE Global Intellicom, Inc.
CO: Global Intellicom, Inc.
ST: New York
IN: CPR
SU: LAW
01/22/99 10:50 EST prnewswire.com
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