HOUSTON, Dec. 15 /PRNewswire-FirstCall/ -- Administaff, Inc. (NYSE: ASF), the nation's leading Professional Employer Organization, today provided updates on several legal matters.

• Administaff has settled its dispute with the Texas Property and Casualty Insurance Guaranty Association ("TPCIGA"), which arose from the Oct. 2001 liquidation of Reliance National Indemnity Co. ("Reliance"), a former workers' compensation insurance carrier of the company. TPCIGA asserted that it was entitled to full reimbursement of benefits paid or to be paid by it under the Reliance workers' compensation policies, which Administaff estimated at approximately $6.9 million as of Sept. 30, 2003. Although Administaff disputed TPCIGA's claim and sought declaratory relief that TPCIGA was not entitled to reimbursement, the company agreed to pay TPCIGA $1.1 million to settle the dispute. Administaff expects that the settlement will be fully covered by an insurance policy secured by the company to cover such losses related to the Reliance liquidation. The settlement is subject to the execution of customary settlement documents.
• On Oct. 30, 2003, a jury returned a verdict in the Aetna lawsuit in favor of Administaff, awarding the company $15.5 million in compensatory damages. On Nov. 7, 2003, the court entered a final judgment in the amount of $15.5 million, with post judgment interest at a rate of 1.3% per annum. On Dec. 10, 2003, the court granted Aetna's motion to reduce the judgment to $10.6 million. The judgment remains subject to post judgment motions and possible appeal.
• In early Dec. 2003, the company collected settlement proceeds of $2.0 million from National Union Fire Insurance Company and American International Specialty Lines Insurance Company. As previously announced, this settlement pertained to Administaff's claim for reimbursement of defense-related legal fees and costs associated with the Aetna counterclaim.

Administaff is a leading personnel management company that serves as a full-service human resources department for small and medium-sized businesses throughout the United States. The company operates 38 sales offices in 21 major markets. For additional information, visit Administaff's web site at www.administaff.com .

(Note: The statements contained in this press release that are not historical facts are forward-looking statements that involve a number of risks and uncertainties. Therefore, the actual results of future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are: (i) changes in general economic conditions; (ii) regulatory and tax developments, including, but not limited to, Administaff's ability to comply with Revenue Procedure 2002-21 and possible adverse application of various federal, state and local regulations; (iii) changes in Administaff's direct costs and operating expenses, including, but not limited to, increases in health insurance premiums, increases in underlying health insurance claims trends, workers' compensation rates and state unemployment tax rates, liabilities for employee and client actions or payroll-related claims, changes in the costs of expanding into new markets, and failure to manage growth of Administaff's operations; (iv) the estimated costs and effectiveness of capital projects and investments in technology and infrastructure, including Administaff's ability to maintain adequate financing for such projects; (v) Administaff's ability to effectively implement its 401(k) recordkeeping services; (vi) the effectiveness of Administaff's sales and marketing efforts, including the company's marketing arrangements with other companies; (vii) changes in the competitive environment in the Professional Employer Organization industry; (viii) Administaff's liability for worksite employee payroll and benefits costs; and (ix) an adverse final judgment or settlement of claims against Administaff. These factors are described in further detail in Administaff's filings with the Securities and Exchange Commission.)

SOURCE Administaff, Inc. CONTACT: investor relations, Douglas S. Sharp, Vice President and Chief Financial Officer, +1-281-348-3232, or douglas_sharp@administaff.com , or news media, Alan Dodd, Director, Corporate Communications, +1-281-348-3105, or alan_dodd@administaff.com , both of Administaff, Inc.