Electronic Clearing House and New Strategies Have Financing Arrangement in Place

Business Wire, Nov 19, 1999

AGOURA HILLS, Calif.--(BUSINESS WIRE)--Nov. 19, 1999--

Electronic Clearing House Inc. (NASDAQ:ECHO) has completed a $1 million post-petition secured financing arrangement with Tropical Beaches Inc. dba New Strategies, a bankcard processing merchant located in Phoenix, who filed for Chapter 11 protection on June 29, 1999.

According to the terms of the loan agreement, New Strategies will begin repayment in December and will retire the loan in full on or before February 2000 together with interest at the rate of eighteen percent (18%) per annum. The loan is secured by all the assets of New Strategies and also has super-priority administrative claim status with respect to any unpaid administrative claims in the Chapter 11 case.

New Strategies has been a merchant with ECHO for over nine years and is the producer of the Don Lapre Making Money infomercial. Over the past five years, New Strategies' sales revenues have averaged between $40 and $60 million a year. The primary products offered by New Strategies have been the Making Money Information package, various Internet-based services and 900 number sponsorship. New Strategies employs approximately 200 people with 120 serving in sales-related positions. As part of the consideration for the loan, ECHO also was granted a first right of refusal to purchase New Strategies and is working with the company, its professionals and representatives of the Official Unsecured Creditors' Committee on formulating a plan of reorganization.

"Over the past nine years, we have seen New Strategies grow as both a sales and marketing company and as an Internet-services provider. This loan allows New Strategies the opportunity to confidently build its sales momentum again and hopefully emerge from bankruptcy early in 2000," stated Joel M. Barry, CEO of ECHO. "ECHO is seriously evaluating the capabilities of New Strategies in terms of its core competencies in infomercial presentation, telemarketing services and Internet services to determine if ECHO would benefit from acquiring New Strategies as well."

Electronic Clearing House Inc. provides credit card processing, check guarantee, check verification, check conversion, inventory tracking services and various Internet services to over 19,000 retail merchants and U-Haul dealers across the nation. ECHO also designs, develops and manufactures software and point-of-sale hardware that is utilized as credit card processing terminals, automated money order dispensers, inventory tracking devices, and casino cash advance systems.

To take advantage of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, you are hereby cautioned that this release contains forward-looking statements that are based upon current expectations and involve a number of risks and uncertainties. Actual operations and results may differ materially from those expressed in the forward-looking statements made by ECHO in this release.