eConnect Secures Additional $5 Million Equity Financing From Alpha Venture Capital Inc.
SAN PEDRO, Calif., Oct. 3 /PRNewswire/ -- eConnect (ECNC) announced that it has signed a definitive agreement for up to $5 million in additional equity financing from Alpha Venture Capital Inc., a member of the Alpha Group of Funds. The Alpha Group is a $750 million private equity fund specializing in providing financing to emerging small-cap and mid-cap companies in domestic and global markets.
The financing, which is in the form of an equity line, extends a previous $5 million commitment to the Company from Alpha in September, 1999. To date, eConnect has drawn down $5.1 million. The addition leaves a total of $4.9 million available to the Company to draw down, subject to certain terms and conditions.
Part of the funding will be used to ramp up production of the first 100,000 eCashPads for commercial distribution promotionally and at retail, as previously planned. Commercially ready eCashPads have arrived at National Data Funding Corporation for usage in an in-house pilot project.
eConnect is establishing host processing systems in the Dominican Republic, Ireland, Hong Kong and Australia, all of which will be international gateways of eConnect's Bank Eyes Only(TM) secure online electronic payment system for transactions originated by the Company's eCashPad. Those flexible systems are being designed to accommodate other electronic payment systems as well.
Even though recent market conditions have made the venture capital community more conservative in its choice of funding projects, ``We didn't look at the stock performance of the Company,'' said Barry Herman, director of Alpha Venture Capital. ``We looked at their products.
``We did our own due diligence on the validity of eConnect's patents and products -- especially the eCashPad. There's nothing like it anywhere else on the market, and we believe that cash payments over the Internet is the future.''
The eCashPad is a ``plug-and-pay'' PC peripheral that will swipe ATM card-with-PIN as well as credit and smart cards, enabling secure e-commerce. A simple, common-sense solution to Internet security, the eCashPad prevents the consumer's financial card data from being seen or stored at the merchant's web site.
Additional details of the above funding is outlined in a form 424A filed with the Securities and Exchange Commission. Separately, the Company continues to communicate with a major market maker, who has been actively engaged towards the relisting of eConnect shares on the over-the-counter bulletin board.
Safe Harbor: Certain statements in this release may contain forward- looking information within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities and Exchange Act of 1934 and are subject to the safe harbor created under those sections. All statements, other than statements of fact, included in this release, including, without limitation, statements regarding potential future plans and objectives of the company, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove accurate and actual results and future events could differ materially from those anticipated in such statements.
SOURCE: eConnect
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