FUSA Signs Virtual Technology Corp.

Virtual Technology Corp. announced Thursday a multi-year marketing and advertising agreement with First USA.

The agreement makes First USA the exclusive marketer of credit card products throughout the VTC Internet properties, which include [www.virtual-world.com][1] and [www.vtcoauctions.com][2].

As part of this agreement First USA will offer a VTC co-branded credit card which consumers will be able to apply for on-line via VTC’s Internet sites. The co-branded “Virtual” card carries no-annual fee, and a low introductory rate followed by a competitive annual percentage rate on purchases and balance transfers.

Consumers submit an application on-line and receive instant credit approval notification for those who qualify. Other features include: co-branded card reward points, money saving balance transfers from another card, 24 hour on-line statement access, and an on-line shopping guarantee against unauthorized charges.

Greg Appelhof, president and chief executive officer of Virtual Technology Corp., said: “First USA is both a leader and an innovator in the credit card field and has been in the forefront of recognizing the potential of the online medium. We are committed to making the on-line shopping experience an enhancement to people’s lives. First USA enables VTC to make consumers everyday lives easier by providing them with the credit card resources they need all in one place in addition to the benefits and convenience that the online medium delivers.”

“Our relationship with VTC presents an exciting opportunity for First USA to continue to take advantage of the power of the Internet as a highly effective marketing channel,” said Kurt Campisano, senior vice president, Internet marketing, First USA.


First USA ([www.firstusa.com][3]), a subsidiary of BANK ONE CORPORATION, is the nation’s largest Visa and MasterCard lender. First USA offers credit cards for consumers and businesses under the First USA, First Card and Bank One names and on behalf of more than 1,500 marketing partners.

ABOUT VIRTUAL TECHNOLOGY CORP. Virtual Technology Corp. is a publicly held Minnesota based company with offices in Minneapolis. VTC is an E-Commerce Internet retailer of high performance computer hardware, and with its recent acquisition of Graphics Technologies Inc. (GTI), is also a leading specialty distributor of premium computer and graphics products, software and peripheral products to sophisticated computer users.

Through its E-Comm Web site at www.virtual-world.com, the company offers more than 42,000 units of selective high-performance, brand name computer equipment. Such Web site and its contents are expressly not incorporated by reference into this press release.

VTC offers an online specialized store that is intended to provide one-stop shopping for its targeted domestic and international customers, 24 hours a day, seven days a week. The company’s online store features a fun, easy to navigate interface, competitive pricing, extensive product information and powerful search capabilities.

In January 1999, VTC acquired substantially all of the assets of Graphics Technologies Inc., a 12-year old company with seven offices nationally and 1998 net sales of $65 million. GTI specializes in the wholesale distribution of high-end premium computers and graphics products such as notebooks, scanners, graphics cards, monitors and other peripherals.

Some of GTI’s vendor relationships are with companies such as Viewsonic, Matrox, Hitachi, Phillips, Okidata, Infocus and ATI. With a customer base of over 1,000 corporations, GTI specializes in business-to-business sales and offers unique purchase programs, solution-oriented sales, integration and configuration services and post-sales support.

GTI has been named as one of the top specialty distributors in Computer Reseller News’ Distributor Census 1998 and VAR Business’s Distributor 50 1998, two of the most prominent trade magazines in the computer wholesaling industry.

Statements in this Press Release that are not purely historical are “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, including statements regarding VTC’s expectations, hopes, beliefs, intentions or strategies regarding the future generally, VTC’s growth strategy, future sales and anticipated trends in VTC’s business. All forward looking statements included in this Press Release are based on information known to VTC on the date hereof, and VTC assumes no obligation to update any such forward looking statements. It is important to note that actual results could differ materially from those in such forward looking statements as a result of a number of factors, most of which are out of the control of VTC, including, but not limited to, VTC’s early stage of development, its lack of profitability and cash flows and competition for the sale of hardware and software products both on and off the Internet.

[1]: http://www.virtual-world.com
[2]: http://www.vtcoauctions.com
[3]: http://www.firstusa.com



Providian Financial says yesterday’s acquisition of GetSmart.com is part of an aggressive push into E-commerce. The company recently acquired the ‘WebCard’ portfolio from H&R Block. Providian also announced yesterday it has formed an E-commerce division to be headed by James Rowe, a Providian SVP. Rowe will also serve as CEO of GetSmart.com. The E-commerce division will develop the GetSmart.com service, the ‘WebCard’ portfolio, Providian’s credit card Web site and its existing on-line money market account business. The company says its on-line, real-time approval for loan products will be its main attraction. Providian, a sub-prime specialist, utilizing price-to-risk credit card products, will likely use the GetSmart.com consumer database to generate leads for its broad range of loan and deposit products. In order to preserve GetSmart’s client base, Providian announced it will operate GetSmart as a stand-alone entity. GetSmart’s current client list includes such issuers as Bank One/First USA, Crestar, Norwest, American Express, Wachovia, Chase, and the Money Store. According to CardData (carddata.com), based on year-end 1998 data, Providian ranks as the tenth largest bank credit card issuer with $11.6 billion in receivables, 10.9 million gross accounts and 6.1 million active accounts. One of Providian’s largest competitors, Metris Companies, announced this week the formation of an E-commerce division.


Gaming Merger

Las Vegas-based NetBet.com announced Wednesday it has signed a letter of intent to merge with Atlanta-based Internet Gaming. IGI has developed proprietary Internet gaming software that allows customers to play games using telephone debit cards. This technology permits customers to access the gaming system using a telephone, if they don’t have access to a computer, or via the Internet and retrieve their winnings from any ATM machine. The company is working on joint ventures with casinos to broadcast ‘Casino TV’ on the Internet, cable TV and overseas television networks.


E-Card Endorsement

FL-based Audio Book Club Inc. announced yesterday that it has signed an agreement with First USA to offer its members the VISA e.Card via a direct link to First USA’s Web site. The E.Card Platinum Visa offers 5% cash back for all purchases made at Audio Book Club’s Web site as well as other premier online merchants, including Amazon.com, eToys, Flowers USA, and Dean & Deluca. Audio Book Club Inc. currently has a combined membership and audio buyer database of over 1,300,000 names.


Paymentech – FDC

Paymentech, Inc. announced last night that it signed a letter of intent for merchant processing services with First Data Merchant Services. Paymentech is in negotiations to outsource to FDC certain processing functions for Paymentech’s general merchant acquiring business. PTI says changing its merchant processing outsourcing relationship will enhance Paymentech’s retail service offerings with feature-rich products on a new merchant processing platform. The firm anticipates completing the conversion by mid-year 2000.


CCS Opens 5 Sales Offices

Nation’s Largest Independent ATM Company Opens Five Regional Sales Offices

Card Capture Services, Inc., a leading independent provider of ATMs nationally, recently opened five regional sales offices in major markets. The new offices are located in Los Angeles, California; Denver, Colorado; Tampa, Florida; Chicago, Illinois; and Portland, Oregon.

Sites were selected based on the company’s long-term sales strategy, says David Grano, CCA president and CEO. ‘The new offices will allow us to support existing clients as well as develop new accounts in the region. We will continue to target both independent businesses and regional chains,’ he said. Opening the regional offices will help the rapidly growing company continue to provide high quality customer support and service to its existing clients.

With the opening of five new offices comes the appointment of five business development managers who will lead each office. John Bunce heads the Northwest territory, which encompasses Oregon, Washington, Idaho and parts of Canada; T. I. Diaz runs the Tampa, Florida office; David Liperote manages the Denver, Colorado office; and Judy Shimizu-Martinez oversees Southern California territory. She also will explore CCS business opportunities in Mexico. Bob Waterloo operates, the Chicago office.

John Bunce knew he wanted to work for CCS shortly after relocating from Chicago to Portland. Now in charge of the Northwest region, Bunce plans to grow the customer base by demonstrating how CCS adds value to carious businesses and financial institutions. ‘My goes is to make sure merchants understand the investment CCS has made to their business, and that they are satisfied with how we honor our obligations.’

‘With CCS, the customer always comes first and our infrastructure is designed to revolve around the customer.’ Say T. I. Diaz, business development manager for the Tampa office. ‘My goal is to build brand-recognition because we’re the good guys, the ones who get it right the first time. We offer a good product, but it’s the behind-the-scenes service for the life of the program we provide that sets us apart from the competition.’

‘I am here to assist banks create and develop their ATM programs, as well as provide merchants solutions for their ATM needs,’ says Dave Liperote, business development manager for the Denver office. Liperote is absolutely passionate about CCS and the services it provides. ‘I want to let people know that we have a physical presence in Colorado. I want to build a face-to-face relationship with the banks and merchants in the region, and to help match CCS products with their business needs.’

One as-yet untapped market is the Hispanic and Asian population of Southern California and parts of Mexico, a cultural territory that trio-lingual Judy Shimizu-Martinez hopes to educate about the advantages of using CCS as its ATM provider. ‘I want to open up the California market and increase brand recognition of CCS. My fluency in Japanese and Spanish will help me reach this audience.’

Bob Waterloo, a native of the Midwest, relocated from Portland to Chicago to take on what he calls, ‘an exciting entrepreneurial opportunity.’ Waterloo’s goal is to increase the presence of CCS in the Midwest by establishing relationships with small and medium-size businesses.

Card Capture Services, Inc. was incorporated in May, 1993 in Portland, Oregon. CCS offers turn-key ATM programs providing transaction processing, machine maintenance, customer service, accounting and reporting to a growing base of 5,770 merchant owned and operated Automated Teller Machines nationwide. The company currently has 119 employees and a nationwide network of 30 independently contracted dealers.


ACE Bill Pay

ACE Cash Express and Travelers Express Company have partnered to create the first universal bill payment service available to walk-in consumers across the nation. ACE said yesterday it has introduced electronic bill payment for retail customers at over 700 ACE stores. Before the launch of this expanded service, ACE accepted electronic bill payments for 23 companies. The firm says so far more than 22,000 customers have enrolled and used the new program. Founded in 1968, the check cashing company currently has a network of 865 stores, consisting of 754 company-owned stores and 111 franchised stores in 29 states.


SuperFlow Compliant

Ireland-based Peregrine Systems Ltd. became the first company to receive compliance certification for its interface to Europay International’s ‘SuperFlow’ image gateway product. Peregrine Systems is a provider of solutions for chargeback processing to the card payments industry. ‘SuperFlow’ removes the need to print and scan the documents at both ends, and allows Europay’s electronic image processing system for retrieval requests and chargeback support documentation to interface with software like Peregrine’s chargeback processing environments, ‘ICS’ and ‘MERCS’.


Metris Online

Sub-prime specialist Metris Companies is gearing up to develop the Internet as a new distribution channel. Yesterday Metris named William Anderson, a 20-year direct marketing veteran, SVP of electronic marketing. Anderson comes to Metris from Bank of America, where he most recently served as EVP of Relationship Marketing. Prior to Bank of America, he was Director of Consumer Marketing for the ‘GM Card’ at General Motors Corp. Ronald Zebeck, Metris CEO, formerly managed the ‘GM Card’ at General Motors Corp. Metris now employs more than 2,000 nationwide.


MemberWorks Goes Intl

MemberWorks Incorporated, a leading provider of innovative membership service programs, announced that it is expanding its operations into international markets with the launch of its first overseas office in London, England.

Beginning this month, MemberWorks will introduce three new membership service programs developed specifically for the UK market. The programs provide discounts to members in such categories as insurance, health, and shopping. MemberWorks has already begun marketing one of its programs to credit card holders through a credit card marketer, and hopes to expand its client base in the UK with other traditional marketers of its programs including banks, utilities and other companies that market products directly to consumers.

“This Company has experienced tremendous growth due to the success and innovation of our products and our ability to market these products to ever expanding distribution channels,” noted Gary Johnson, CEO of MemberWorks. “We conducted extensive market research in Europe over the past several years and believe it offers great, untapped potential with a promising new consumer base.”

MemberWorks has hired a management team that will work under Clive Archer, who was brought in as Managing Director of the London office. Mr. Archer has extensive experience in database marketing and client services. MemberWorks plans to expand further internationally, using its London office as a base.

Headquartered in Stamford, Connecticut, MemberWorks Incorporated is a leading provider of innovative membership programs. MemberWorks offers its programs to increasingly sophisticated consumers seeking economy, efficiency and convenience in their purchase of products and services. As of December 31, 1998, there were some 4.4 million members enrolled in the Company’s 15 programs.


Magic Line EFT Conference

Chicago is the site of the Magic Line EFT Technology Conference 1999, set for June 23-25 at the Palmer House Hilton. Sponsored by Magic Line, Inc., the Midwest’s leading electronic funds transfer network, this annual event draws attendance from financial institutions throughout the region based on two key elements: national industry experts addressing the hottest industry trends and topics; and hands-on exposure to the newest electronic payments technologies.

“Our Conference offers opportunities for training and education based on the strength of both our presenters and our exhibitors. To develop an annual program that both meets the needs of our member institutions and keeps them competitive in this industry, we survey our attendees following each Conference,” said John Bascom, president and chief executive officer, Magic Line. “Last year 75% of attendees rated the Conference as ‘Excellent’ and 93% indicated they plan to return this year. These ratings tell us that attendees find great value in the agenda and the interactive exhibit area.” The 1999 Conference highlights are as follows:

Wednesday, June 23

Prairie Landing Golf Club

11:30 a.m.-4 p.m. EARLY REGISTRATION

“ATM & EFT Security Workshop”
F. Barry Schreiber, Ph.D.

Thursday, June 24

8:20 a.m.-10 a.m. GENERAL SESSION I
“Your 21st Century Sound EFT Solution”
John Bascom, Magic Line, Inc.
Dennis Lynch, NYCE Corporation
“The Heart and Soul of a Winning Team”
Joe Calloway, CSP

10:45 a.m.-11:45 a.m. GENERAL SESSION II
“A Look at the Internet & the Future of Financial Services”
Speakers from Integrion & Borders Bookstores

1:15 p.m.-2:20 p.m. BREAKOUT SESSIONS I
“Magic Line(R) & NYCE … What the Merger Means For You”
Speakers from Magic Line & NYCE
“Measuring and Enhancing ATM Program Profitability”
Ann Schmitt, Dove Associates
“Communicating on the Year 2000 … and Beyond”
Gillian Albers, Infinitus Enterprise Services, Inc.
“Leadership, Teamwork & Winning”
Jim Beardon, CSP

(repeat of Breakout Sessions I)

4:15 – 5:20 p.m. BREAKOUT SESSIONS III
“Point-of-Sale: Satisfying Consumers & Generating Revenue”
Speaker from Magic Line
“Developing a Bill Presentment Strategy”
Tom McNab, BlueGill Technologies, Inc.
“Technology & Risk: How To Make It All Balance”

Rick Hite, Visa USA
“Using Data Warehousing To Target Consumers”
Ray Ferrara, KPMG

Friday, June 25

8:35-10:20 a.m. GENERAL SESSION III
“Rhythm, Blues and Merger News”
John Bascom, Magic Line, Inc.
Dennis Lynch, NYCE Corporation
“IntelligentRisking(SM) To Reach Your Goals”
Barbara J. Stoker, CSP

10:50 a.m.-11:55 a.m. BREAKOUT SESSIONS IV
“ATM Marketing: What’s New For The Next Millennium?”
Diebold, Inc.
“Remote Banking Strategies”
Speaker TBD
“Off-Site ATM Deployment: Home Run or Strike Out?”
Frank Capan, Access Cash
“Displacing Cash & Checks with Debit”
Lisa Estes, MasterCard International

For further 1999 Conference information or registration details, visit Magic Line’s Web Site at www.magicline.com to register online, or contact Jennifer Clark at Magic Line, 800-872-4047, ext 570. As one of the top regional EFT networks linked throughout the United States and globally, Magic Line supports 14.9 million cardholders with access to over 169,000 ATM, POS and remote banking terminals. Magic Line processes 15 million transactions monthly and serves over 1,055 banks, credit unions and thrifts in Michigan, Illinois, Indiana, Kentucky, Ohio, Missouri and 8 other states. The company offers: full-service ATM management; ATM terminal driving; cardbase management and authorization services; on-line POS debit services with ML Pay(R); off- line POS debit services with MasterMoney and Visa Check Card; remote banking/bill payment services; and marketing services.


Recurring Payments

Automatic bill payment saves U.S. consumers an estimated $375 million a year in postage alone. According to Michigan’s The Payments Authority, the average U.S. household pays approximately 200 bills a year and incurs annual postage costs of $66. Add the cost of printing checks and the occasional late fee, and consumers easily spend $100 a year for paying bills. The Payments Authority is a non-profit association of more than 500 financial institutions throughout Michigan’s Lower Peninsula founded in 1974 to promote EFT. As a result, use of electronic payment alternatives have grown in Michigan by 24% in the last nine years, compared to 17% nationwide.