Foreign Exchange

American Express Foreign Exchange Services activated its new Internet-based service to enable small and medium-sized companies to initiate payments in 41 foreign currencies, around the clock. The new online service also lets a firm create and update personalized files of payees, and view and print transaction histories. Businesses may also call or fax AmEx foreign exchange specialists with payment requests in 90 currencies. There are no start-up fees charged to businesses that enroll in the program. For the first three months after enrollment, there are no transaction fees on any foreign currency transaction above $2,500. After three months, the fee for each transaction is $10.

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ESOL Debit Card

Employee Solutions, Inc. and Bank One have teamed up to market an Employee Solutions’ debit card.  The debit card, currently in beta testing, will be available to clients and employees later this year. Worksite employees will have the ability to deposit all or part of their payroll into a fund that can be utilized through the ‘Employee Solutions VISA Cash Card’. The card can also be used nationwide at any point of sale location that accepts VISA or to obtain a VISA cash advance at any bank or any ATM including ‘Rapid Cash’ machines. Bank One will provide a 24-hour 800 number for customer information along with a monthly activity statement for cardholders.

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AmEx Goes Regional

American Express is now listing special cardmember offers by state and by industry category on its website at [americanexpress.com][1].  Upgrades, gift-with-purchase promotions and significant savings are available from restaurant, travel and lifestyle retailers. AmEx is also offering a free brochure on “Cybersmarts:  Tips For Protecting Yourself  When Shopping Online”.

[1]: http://www.americanexpress.com

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BJ Processing Deal

Chase Merchant Services this week introduced a new business program for BJ’s Wholesale Club, the third largest wholesale club in the United States, with over 4.5 million members. Under the five-year agreement, BJ’s Merchant Payment Processing offers BJ’s business members discounted payment processing through Chase Merchant Services.  In addition, Chase Merchant Services announced a renewal agreement to process credit card sales for BJ’s Wholesale Club. Under the three-year agreement, CMS will provide transaction authorization and processing, and settlement and funding services for BJ’s 91 warehouse clubs in the eastern United States. Chase Merchant Services, a joint venture between First Data Merchant Services and Chase Manhattan Bank, processes about 2 billion transactions a year and more than $100 billion in annual credit and debit card sales volume. Further details regarding the BJ’s program will be available in BJ’s Wholesale clubs on Nov. 16.

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Cross Country Card Bonds

Secured card and sub-prime card specialist Cross Country Bank has completed the securitization of approximately $200 million in credit card receivables.  Cross Country Bank, founded in 1996, is an $806 million asset institution. The Bank was formed as an outgrowth of Applied Card Systems, a credit card servicing company that specializes in the marketing and servicing of secured card and other nontraditional credit products since 1987.

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Hypercom Japan GM

Hypercom Corporation, a global provider of electronic payment solutions, has named Kenichi Nakamura General Manager for Hypercom Japan. Prior to joining Hypercom(R), Mr. Nakamura served as District Sales Director and Senior Manager for Auto Suture Japan Inc., a subsidiary of the U.S. Surgical Corporation.

In his new position, Mr. Nakamura will be directly responsible for managing and directing the marketing, sales and operations of Hypercom Japan. As General Manager, Hypercom Japan, he will play a key role in directing Hypercom’s aggressive expansion plans within the Asia-Pacific Rim Region. Mr. Nakamura will report to Clive Cooper-Smith, Managing Director, Hypercom Asia-Pacific.

Established in 1995 and headquartered in Hong Kong, Hypercom Asia-Pacific has in three short years quickly established itself as the provider-of-choice for more than 100 banks, merchants and service providers throughout the region.

“Mr. Nakamura’s in-depth industry and regional experience strengthens the strategic insight necessary to continue to accelerate the growth of our business and increase Hypercom’s marketshare in the Japanese market,” said Clive Cooper-Smith, Managing Director, Hypercom Asia-Pacific. “We are pleased to announce Mr. Nakamura’s appointment to the Hypercom Asia-Pacific management team.”

Mr. Nakamura has more than 20 years of experience in the healthcare, personal computing and the point-of-sale (POS) sectors.

Prior to joining Auto Suture Japan, Mr. Nakamura held senior and director-level sales and management positions with companies such as the ASCII Corporation, a leading personal computer software and LSI design firm, and OMRON Corporation, a manufacturer and exporter of electronic products.

Celebrating its 20th anniversary, Hypercom Corporation (NYSE: HYC) is a global provider of electronic payment solutions, including multi-functional point-of-sale terminals, peripherals, network products, transaction software, Internet-based and electronic commerce payment solutions. On a global basis Hypercom delivers the services and technology infrastructure required to quickly integrate and deploy new payment applications for competitive value-add programs, improved business performance and low total cost of ownership.

Headquartered in Phoenix, Arizona, Hypercom markets its products in more than 60 countries through a global network of offices and affiliates in Argentina, Australia, Brazil, Chile, China, Hong Kong, Hungary, Japan, Mexico, Russia, Singapore, the United Kingdom and Venezuela. Hypercom’s Internet address is [www.hypercom.com][1].

[1]: http://www.hypercom.com

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Household to Fleet

Household International announced Tuesday that it has signed a definitive agreement to sell $1.3 billion of credit card receivables to Fleet Financial Group that represent 700,000 cardholders. The receivables included in the transaction are part of the company’s $4.7 billion Household Bank-branded portfolio. Household said the sale is consistent with the company’s previously announced strategy to sharpen the focus of its U.S. bankcard business by de-emphasizing non-core Mastercard/VISA activities. At the end of the third quarter, according to CardData (www.carddata.com), Household held $15,904,227,000 in receivables for 15,987,000 accounts. Prior to the Household acquisition, Fleet had approximately $15 billion in receivables and eight million credit card customers.

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IMPACT Internet Billing

Bell & Howell Company announced Tuesday its launch of ‘IMPACT Internet Billing’. ‘IMPACT Internet Billing’ integrates paper and electronic billing systems into a solution that enables high-volume billers to respond efficiently to their customers’ needs for ways to receive and pay bills via the Internet. ‘IMPACT Internet Billing’ combines the technology and services of Bell & Howell Mail Processing Systems with the electronic billing and payment solutions provided by business partners, CheckFree and edocs.

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Oberthur — EDS

EDS’ Electronic Business unit and Oberthur Smart Cards announced this week a cooperative agreement that will expand their expertise and offerings in plastic card manufacturing, card personalization and smart cards. Under the agreement, EDS will transfer all assets from its card production facilities in Westlake, Ohio and La Mirada, California to Los Angeles-based Oberthur Smart Cards USA. The five-year agreement calls for EDS to maintain all of its existing client relationships, contracts and customer service while Oberthur will provide back-end production support for manufacturing and personalization activities. The transition process will begin immediately with Oberthur assuming full responsibility for all production operations. EDS will continue to support its client base with a complete and expanding set of plastic card services. The EDS facilities produce and provide full support for over 5 million embossed cards annually.

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AmEx Acquires Leasing Company

American Express Company and Rockford Industries, Inc. announced this week that they have entered into a definitive agreement under which Rockford would become a wholly owned subsidiary of American Express. The agreement is subject to regulatory and Rockford shareholder approvals.

Rockford, a company that finances and leases equipment for small businesses, reported net income of $2.1 million on revenues of $19.1 million in 1997.  For the first nine months of this year Rockford reported net income of $1.7 million on revenues of $15.8 million.  The company, which has approximately 135 employees, originated loans of $166.7 million in 1997, and $168 million for the nine months ended Sept. 30, 1998.

On a fully diluted basis, American Express will pay a gross purchase price of approximately $61 million in a tax-free exchange of stock.  On closing, Rockford common stock will be valued at $11.88 and converted into American Express common shares, based on their average closing price for the ten days ending three days prior to the closing date.

The agreement was approved by the boards of directors of both companies. A special meeting of Rockford shareholders to vote on the acquisition is expected to be held in early 1999.

American Express has also entered into an option agreement with the three principal shareholders of Rockford: Gerry J. Ricco, Larry E. Hartmann and Brian A. Seigel.  Collectively they own approximately 51 percent of the outstanding shares of Rockford common stock.  As part of this option agreement, the three principal shareholders have agreed to vote their shares in favor of the acquisition and have granted American Express an option to purchase their shares, upon the occurrence of certain events.

Rockford Industries, a 14-year-old specialty finance firm based in Santa Ana, California, provides financing to small business customers through a network of more than 1,000 vendors and manufacturers of health care, telecommunications, information technology and general office equipment.  This network includes companies such as Allergan, Inc., Bergen Brunswig Corporation, Cisco Systems Inc., Medic Computer Systems, Inc. and Respironics Inc.

“Rockford Industries is a leader in point-of-sale, small ticket equipment financing, with an experienced management team, state-of-the-art systems and a dedication to superior customer service,” said Steven W. Alesio, President of American Express Small Business Services.

“Rockford is a strong complement to our own small business lending capabilities. It opens up a whole new distribution channel and provides us with the expertise to finance significantly larger purchases,” he added. American Express currently offers pre-approved credit lines for equipment purchases up to $25,000.  Rockford offers customers up to $250,000 in business equipment financing.

American Express had $1.3 billion in small business loans outstanding for the first half of 1998 generated from its equipment finance business, credit cards and unsecured lines of credit up to $50,000.

“When a small or medium size company is at the point of making a major equipment purchase, American Express will be able to offer convenient and competitively priced financing,” Alesio said.

Gerry Ricco, Rockford President and Chief Executive Officer, said, “we believe that joining with American Express provides benefits to our shareholders, employees and customers.  Our shareholders will receive shares in one of the premier financial services companies in the world.  Our employees and sales associates have the opportunity to grow with one of the most trusted brand names in financial services.  For our customers, American Express brings a broader range of products and services to help address their cash flow and expense management needs.”

Ricco will join American Express as President, vendor financing, reporting to Danny Lam, General Manager of American Express’ equipment financing group. American Express Company is a diversified worldwide travel and financial services company founded in 1850.  It is a leader in charge and credit cards, Travelers Cheques, travel, financial planning, investment products, insurance, accounting and international banking.

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AmEx Gift Card

American Express rolled out an electronic retail ‘Gift Card’ this week to tap the $13 billion potential gift card market. The first ‘Gift Cards’ were released for Chanel boutiques and Tower Records. The AmEx ‘Gift Card’ is a mag stripe stored value card and is loaded with value at the point-of-sale. AmEx says it expects to announce several more retail partners during the first quarter 1999.

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CheckFree Biller Alliance

CheckFree announced the CheckFree Biller Alliance Program, aimed at simplifying and accelerating the process for financial institutions and billers to enter the electronic bill presentment and payment market.  This new program outlines the requirements potential CheckFree partners must meet to ensure that CheckFree’s leading distribution and payment systems seamlessly interface with products and services focused on bill creation.

“As the market leader in electronic commerce solutions, CheckFree is pleased to make our open infrastructure formally available to top companies involved in creating these solutions,” said Pete Kight, chairman and chief executive officer of CheckFree.  “We will partner with a select number of companies that demonstrate a commitment to enabling as many bills as possible to be presented to as many consumers as possible to generate broad consumer adoption.”

The EBPP process includes bill (1) creation, (2) distribution and (3) payment.  CheckFree’s core services focus on distribution and payment. Through its Biller Alliance Program, CheckFree will be able to provide turn- key bill creation solutions that reside at the biller’s premises.  To become part of the CheckFree Biller Alliance, companies must:  (1) be committed to the creation phase of EBPP, (2) demonstrate integration compatibility with CheckFree’s distribution and payment infrastructure by coding their systems to work with CheckFree’s open application program interfaces (APIs), (3) have adequate implementation and support resources to implement systems in a timely manner, and (4) be actively working with customers moving forward with EBPP solutions.

“Our goal is to drive solution interoperability between CheckFree and its partners so that the various components involved in EBPP — on our end and theirs — can seamlessly interact,” added Kight.  “We want to provide our biller customers with a system that can be quickly created and deployed and that has access to CheckFree’s complete tracking and customer care system to create a reliable, pleasurable experience for the consumer.”

CheckFree plans to focus on software vendors, turnkey solution providers, billing service providers and systems integrators, and has already signed agreements with BlueGill Technologies, Bell & Howell, edocs, International Billing Services, Just in Time Solutions, Mobius Management Systems, and Total System Services, with more announcements to come.

For more information on the CheckFree Biller Alliance Program, please contact Jan Peterson at 972-355-0971 or by e-mail at [jpeterson@checkfree.com][1].

About CheckFree

Founded in 1981, CheckFree (), the operating subsidiary of CheckFree Holdings Corporation, is the leading provider of financial electronic commerce services, software and related products for more than 2.5 million consumers, 1,000 businesses and 850 financial institutions. CheckFree designs, develops and markets services that enable its customers to make electronic payments and collections, automate paper-based recurring financial transactions and conduct secure transactions on the Internet.

[1]: mailto:jpeterson@checkfree.com

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