SANTO DOMINGO, Dominican Republic, Feb. 26, 2003 (PRIMEZONE) -- FreeStar Technology Corporation (OTCBB:FSTI) is pleased to announce that the terms of the Company's acquisition of Rahaxi Processing Oy, a leading Northern European Processor, located in Helsinki, Finland, were further improved through an Amendment executed yesterday.
FreeStar Technology's Agreement to acquire Rahaxi Processing, first announced in September 2002, provided for FreeStar to make incremental cash payments of $4.3 million to the Seller over the course of 13 months. Pursuant to the first Amendment executed between FreeStar Technology Corp and the Seller, Heroya Investments Limited, on December 16, 2002, and the Company's Form 8-K/A filing of December 24, 2002, FreeStar issued 22 million restricted common shares in consideration for 53.3% of Rahaxi Processing. The remainder of the purchase price ($2,008,100) was to be settled through incremental cash payments commencing February 2003 and ending December 2003.
Pursuant to the second Amendment executed between FreeStar Technology and the Seller on February 25, 2003, and the Company's Form 8-K/A filing of this date, FreeStar will issue 23.2 million restricted common shares in consideration for an additional 33.3% of Rahaxi Processing. Yesterday's Amendment supplements changes introduced to the original Agreement through the December 2002 Amendment to the extent that the cash consideration for FreeStar's acquisition of Rahaxi Processing is reduced from approximately 47% to approximately 13%. Thus, FreeStar's holding of Rahaxi shares increases from 16 to 26 (representing approximately 87% of the 30 shares issued and outstanding). The remainder of the purchase price ($552,100) will be settled through incremental cash payments commencing March 2003 and ending December 2003.
Fionn Stakelum, President of Rahaxi Processing, stated, "We welcome the Seller's vote of confidence in FreeStar's fundamentals. Restructuring the terms in this manner will obviously expedite positive earnings and add shareholder value. I am especially pleased that negotiations underlying this decision came at the Seller's own behest, signaling to the whole FreeStar team that we are well and truly on track."
About FreeStar Technology Corporation
With Corporate headquarters in Santo Domingo, Dominican Republic, and offices in Dublin, Ireland, and Helsinki, Finland, FreeStar Technology is focused on exploiting a first-to-market advantage for enabling ATM and debit card transactions on the Internet and high-margin credit card processing through a leading Northern European processor, Rahaxi Processing Oy. FreeStar Technology's Enhanced Transactional Secure Software ("ETSS") is a proprietary software package that empowers consumers to consummate e-commerce transactions on the Internet with a high level of security using credit, debit, ATM (with PIN) or smart cards. It sends an authorization number to the e-commerce merchant, rather than the consumer's credit card information, to provide a high level of security. For more information, please visit the Company's web sites at www.freestartech.com, www.rahaxi.com and www.epaylatina.com
About Rahaxi Processing Oy
Rahaxi Processing Oy, acquired by FreeStar Technology from Heroya Investments under cover of an agreement from September 2002, is a payment service provider based in Helsinki, Finland, offering full, card present, payment processing; transaction authorization, data capture and settlement facilities for Visa, MasterCard, American Express, Diners Club and all bank-issued domestic debit cards. Rahaxi also provides specialist value-added processing applications for fleet, fuel and loyalty card schemes. Approximately US$10 million has been invested in the development of Rahaxi's hardware, software and brand name, to date. Rahaxi provides a wide range of robust payment solutions that support sophisticated, integrated point-of-sale systems to meet the ever changing, complex needs of a wide array of industry sectors. The Company currently processes approximately one million transactions per month, but is capable of handling an additional seven million transactions per month without significant upgrades or technical enhancements. For more information, please visit the company's web site at www.rahaxi.com.
Certain statements in this news 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 Exchange Act of 1934, and are subject to the safe harbor created by those rules. 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 to be accurate and actual results and future events could differ materially from those anticipated in such statements.