PT-1 Offers Free POS Terminals

Flushing, NY, Feb 5, 1999 (DLD Digest) - PT-1 Communications, Inc., a subsidiary of STAR Telecommunications, Inc. (Nasdaq: STRX) and the nation's largest prepaid calling card provider today announced that it has begun shipments nationwide of the PT-1 7310 point of sale terminal -- a revolutionary PIN distribution system for delivering a range of prepaid telecom services at the retail level. Using the terminal, retailers can simultaneously offer prepaid cards as well as other prepaid products from a single device. The electronic PIN distribution system is a small, off-line terminal that communicates daily with PT-1 computers at headquarters in New York, to request the replenishment of new calling card PIN's and other prepaid product inventory sold that day. "PT-1 will provide all qualified, participating retailers with a free electronic distribution terminal valued at $795 for each store," said Paul Gregory, vice president of new business development. "The new system has shown in field tests conducted at Cumberland Farms, Store 24, Christy's of Cape Cod, Honey Farms, Mutual Oil, and other retailer sites to be capable of quickly printing up a new PT-1 card in less than three seconds with complete security." Gregory added, "The electronic PIN distribution concept allows chain store retailers to manufacture other prepaid products on the spot." Store 24, a Boston-based chain, has enjoyed even greater sales growth with prepaid products. According to Andy Steele, Store 24's Category Manager, "Phone cards today represent an incredible 3% of our total sales with a chain-wide average of over $700 per week per store; up 85% over last year. The new PT-1 terminal will not only control shrinkage, but will also totally eliminate all inventory carrying costs. Store 24 sees a bright future in growing the entire prepaid telecom category." The PT-1 7310 system consists of a credit-card style terminal with an integrated printer that is capable of printing the entire back of a prepaid card with a PIN number at the time of sale. Because the cards carry no value until they are printed, they can be displayed in high traffic impulse areas The PT-1 7310 system consists of a credit-card style terminal with an integrated printer that is capable of printing the entire back of a prepaid card with a PIN number at the time of sale. Because the cards carry no value until they are printed, they can be displayed in high traffic impulse areas. A retailer will only pay for prepaid products sold. According to Gregory, "Our typical PT-1 retailer can sell over $350 a week in phone cards. With this new system, they can realize an immediate sales boost of 20-25% simply by eliminating any possible out of stock conditions." As part of the system, PT-1 provides retailers with their own confidential Internet web page to access, monitor, and manage daily store sales. The company expects to be placing over 1500 terminals in the next several months with the potential for sharply ramped shipments forecasted by the end of the year. About PT-1 Communications PT-1 is a wholly-owned subsidiary of STAR Telecommunications, Inc. (Nasdaq: STRX). Established in 1995, PT-1 is the nation's largest provider of prepaid calling cards. The company focuses on the international long distance marketplace, which accounts for 70% of all prepaid calling card revenues. With the most widely recognized brands, PT-1 has the top selling line of phone cards in America. PT-1 is also a leading provider of dial around services under the 101-6868 plan. Except for the historical information contained herein, this press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbors created thereby. STAR Telecom's future actual results could differ materially from the forward-looking statements discussed herein. A list of the factors that could cause actual results to differ materially can be found in the documents the Company files with the SEC, including those contained in STAR's prospectus, and the Form 10-Q for the period ended Sept. 30, 1998.