VictorMaxx Technologies, Inc./Sonoma Holding Corp. Completes Acquisition Of Payday Check Advance, Inc

Business Wire, Feb 3, 1998

SOUTH BARRINGTON & WEST DUNDEE, Ill.--(BUSINESS WIRE)--Feb. 3, 1998--VictorMaxx Technologies, Inc. (NASDAQ: VMAX) has completed the acquisition (for stock) of Payday Check Advance, Inc., a privately held company in the Chicagoland area.

Payday Check Advance, Inc. is a consumer lending company making low-documentation, high-interest, short term loans to the gainfully employed.

"We see the acquisition of Payday Check Advance, Inc. as a very positive step for VictorMaxx," said Terry Donati, President of VictorMaxx. "With the acquisition of Sonoma Holding Corporation in December of 1997, VictorMaxx/Sonoma is now a holding company. We are always looking for profitable, privately-held businesses to acquire under favorable terms. Though Payday is small at this point, the company is growing extremely rapidly. We believe it has the potential to quickly realize substantial profit margins. Payday will be a very valuable addition to our growing subsidiary base."

Payday Check Advance, Inc. was founded in August of 1997. With 6 storefront locations in Illinois (15 locations anticipated by the end of the first quarter of 1998), the company issues "check advance" loans to retail clientele. Customers write post-dated checks to Payday and are extended up to 30-day cash loans. Upon maturity of the loans, Payday cashes the customer's check and is repaid the principal amount of the loan plus a service fee and interest charge.

"As a business, Payday has all the benefits of a pawn-shop concept but without the need to maintain a physical inventory," noted Mr. Donati. "A pawn shop loans money and takes in some item of personal property as collateral. When the customer repays the loan, the pawn shop receives the face amount of the loan plus interest. With Payday, there is no inventory. Instead, the borrower issues a post-dated check. Like a pawn shop, Payday is a quick and convenient way for borrowers to obtain a short-term loan. The entire process only takes about 10 minutes."

Though relatively young, Payday Check Advance is growing rapidly. "We see considerable room for accelerated expansion," noted Frank Contaldo, Chief Executive Officer of VictorMaxx/Sonoma. "At this time, competition in the geographic area is limited. In addition, the fixed costs of opening a new store are relatively small. To date, the low fixed costs have allowed new Payday stores to quickly turn profitable. The one constraint to new-store expansion is the cash reserves needed to make new loans. However, our loan turnaround is very fast and in addition, Payday has obtained bank financing to help meet the new loan demand. Considering all factors, we have set a company goal of having 50 store locations in operation by the end of 1998. Furthermore, our target is to achieve an average monthly pre-tax profit of $4,000 per location."

Payday Check Advance caters to a specific customer demographic audience. "The success of a Payday store depends largely on the demographics of its surrounding neighborhood," said Kevin Koy, Chairman of the Board of VictorMaxx/Sonoma. "Since most Payday customers are employed individuals who need cash to tide them over to the next paycheck, we target stores in working-class neighborhoods. All things being equal, the higher the concentration of our target demographic in the neighborhood the more productive the store location will be."

In December of 1997, VictorMaxx Technologies, Inc. acquired Sonoma Holding Corporation. At that time, a Sonoma-led Board of Directors and management team was installed. It is expected that the company will change its name to Sonoma Holding Corporation within the next few months, pending approval by shareholders. VictorMaxx stock presently trades on the NASDAQ Bulletin Board system under the symbol "VMAX".

CONTACT: Media/Analysts:

For VictorMaxx Technologies Inc.

Randy Shell, (405) 691-2793

or

VictorMaxx/Sonoma

Kevin Koy, (847) 441-1896