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EXHIBIT 99.1
NEWS RELEASE
FOR IMMEDIATE RELEASE
FREEREALTIME.COM RECEIVES COMMITMENTS IN EXCESS OF $10 MILLION FROM STRATEGIC
INVESTORS; ENTERS BROAD ALLIANCE WITH JEFFERIES & COMPANY
COMPLETES MAJOR CONDITIONS FOR REDCHIP.COM MERGER
IRVINE, CA -- August 16, 2000 -- FreeRealTime.com, Inc. (OTCBB: FRTI), a leading
Web-centric financial information services company that plans to merge with the
privately-held RedChip.com, Inc., announced today it has received commitments in
excess of $10 million in private equity financing. Most of the funding comes
from strategic investors, including Los Angeles-based Jefferies & Company, Inc.,
a national institutional brokerage and investment banking firm, as the lead
investor. Jefferies' significant investment was the centerpiece of a
wide-ranging strategic alliance with the Company. FreeRealTime.com stated that
the Jefferies' strategic alliance, together with the equity funding, provides
substantially all the resources necessary for its 2001 business plan and growth
initiatives. Completion of the financing was also the final major condition to
FreeRealTime.com's previously announced merger with RedChip.com, the award
winning investment research and information firm devoted to "discovering
tomorrow's Blue Chips today." The companies have now cleared all regulatory and
financing hurdles and expect to close their merger shortly.
The strategic alliance between Jefferies and FreeRealTime.com has been entered,
concurrent with the equity placement, pursuant to a signed a letter of intent
(LOI). Under terms of the LOI, FreeRealTime.com and Jefferies plan a broad-based
alliance to provide Web-based financial transaction services and to jointly
market investment information services, including the distribution of public and
private securities by Jefferies and DigitalOffering.com, FreeRealTime.com's
planned online distribution portal for these types of transactions. The proposed
alliance contemplates the issuance of additional common stock to Jefferies in
exchange
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for its contribution of technology resources, including licenses of existing
trading systems as well as ongoing development resources for co-developed
trading tools and execution services. Additionally, the proposed alliance
includes certain joint marketing and selling arrangements for FreeRealTime.com
and, subsequent to the merger, RedChip.com products and services. The parties
will share any revenues and fees generated in future periods from the alliance
activities, and the proposed arrangements provide that Jefferies may receive its
share of revenues in shares of FreeRealTime.com common stock in lieu of cash.
FreeRealTime.com announced oversubscribed commitments for the $10 million
private placement that consists of up to 3.8 million shares of the Company's
common stock. The Company announced a first closing in excess of $7.5 million,
thereby completing the financing condition in the RedChip.com merger, and has
additional commitments which oversubscribe the maximum $10 million private
placement approved by FreeRealTime.com's Board of Directors. The funds from the
transaction will be used for working capital and general corporate purposes,
including funding the business plans of the combined FreeRealTime.com and
RedChip.com well into 2001. As recently reported, for the fiscal first quarter
ended June 30, 2000, FreeRealTime.com produced its first operating profit
(before non-cash items) as a public company. Pursuant to its role as the largest
corporate stockholder in the Company and the strategic alliance, Jefferies will
be an active investor in FreeRealTime.com with two seats on the Board of
Directors. Roth Capital Partners, a full service investment banking firm based
in Southern California, was also a significant strategic investor in the private
financing, and, while already a major stockholder in RedChip.com, Roth
reaffirmed its strategic alliance and Board participation with the combined
company. Other strategic investors included The Millennium-Hanson Fund, a
venture fund associated with Sir Robert Hanson of the U.K., and investment
affiliates of Thomson Kernaghan & Co., Ltd., one of the oldest independent
institutional brokerage and investment banking firms in Canada.
Geoffrey Moore, Chairman and Co-Chief Executive Officer of FreeRealTime.com,
stated, "We are extremely excited about the Jefferies' strategic alliance. They
bring us extensive resources in two broad areas: first, trading tools and
execution technologies, where they are an acknowledged leader; and, second,
national scope as an institutional trading and investment banking firm with a
leading position in capital markets services for RedChip.com-type companies, or
emerging growth and middle market public concerns. With access to these
resources, our stockholders should benefit from the alliance in a number of
ways. The Jefferies relationship should
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significantly broaden our sales and marketing capabilities for investment
information services and programs, particularly for the RedChip.com research
services to their large base of institutional clients. They can also
substantially accelerate our strategic plans to launch securities offerings and
trading services for SOHO institutional and independent investors. All told,
this alliance holds much promise, and they've certainly `backed up' their
commitment by becoming the lead investor in this private financing, our single
largest institutional stockholder, and an active participant on our Board."
John C. Shaw, Jr., Co-President of Jefferies, stated "FreeRealTime.com has done
a great job attracting a large membership base of sophisticated independent
investors with their array of investment information, research and analytic
tools. Their customers have been asking for more value-added services,
especially trading tools and execution services, and we've got substantial
technology resources in this area that we plan to make available pursuant to
this alliance. Additionally, we are a leading trader in hundreds of
RedChip.com-type public companies and have strong relationships with virtually
all the leading institutional investors in this area, so we've got a number of
natural synergies to exploit between our firm and the merged company's
RedChip.com services."
Richard B. Handler, Co-President of Jefferies, commented, "We didn't just want
to be a trading and marketing partner with FreeRealTime.com, we wanted to be a
significant shareholder. Together with the resources we can bring through this
alliance, the merged company has strategic plans and growth initiatives underway
that, we think, represent compelling opportunities to create shareholder value."
ABOUT FREEREALTIME.COM
FreeRealTime.com, Inc. is a leading digital financial media company, empowering
investors with the information and tools they need in order to make
knowledgeable-investing decisions. The FreeRealTime.com Web site delivers an
extensive array of stock market data, business information, communication tools,
and sophisticated research and investment management tools for institutional
investors, brokers and independent investors. Launched in 1998, the
FreeRealTime.com community now has over 1.27 million members. FreeRealTime.com
has been recognized as a leader by such notable sources as CNBC, Online
Investor, Forbes, The Wall Street Journal, and The Los Angeles Times.
Nielsen//NetRatings also recently ranked
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FreeRealTime.com as the "stickiest" financial site used at home and the second
"stickiest" of ALL sites used at home. FreeRealTime.com's business partners
include such premiere organizations as Telescan, Go2Net, InfoSpace, Market Guide
and JagNotes. Visit FreeRealTime.com's Web site at http://www.freerealtime.com.
ABOUT JEFFERIES & COMPANY, INC.
Jefferies & Company, Inc. is an institutional brokerage firm focused on trading
in equity, high yield, convertible and international securities, as well as
research for institutional investors, and an investment bank providing capital
raising, merger, acquisition, and restructuring services for middle market
companies. Jefferies is also a leader in equity trading for institutional
investors, as recognized by numerous consulting and survey organizations.
Further information about Jefferies, including a description of trading,
research and investment banking services, can be found at Jefferies' Web site,
http://www.jefco.com.
ABOUT REDCHIP.COM
RedChip.com, Inc.(TM) is a vertical portal serving "Tomorrow's Blue Chips"
companies and their investors. The Company publishes proprietary equity research
on nearly 270 companies under The RedChip Review(R) banner, as well as
information about the small-cap markets and individual companies under the
RedChip Reporter(TM), RedChip Radar(TM), and RedChip Profile(TM) trademarks.
RedChip.com(TM) was recently recognized by Forbes' "Best of the Web" as the
"Best of the Best" top small-cap site. Forbes' staff evaluated over 5,000 Web
sites and grouped the best of these into more than 90 categories, with one site
in each category--the "Best of the Best"--as Forbes' favorite. Forbes said that
investors value the RedChip(TM) site for the quality of its independent research
and for the breadth and depth of information presented to investors, including
research coverage on 270 companies, more than 5,000 investment profiles,
small-cap news and commentary, real-time trading information, and webcast
research conferences and management presentations. In addition, RedChip(TM)
analysts' recommendations have consistently outperformed major benchmarks.
Headquartered in Portland, Oregon, RedChip.com(TM) also has offices in
Minneapolis, San Francisco, Los Angeles, and New York. Visit RedChip.com's Web
site at http://www.redchip.com/.
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Safe Harbor. Except for any historical information contained herein, the matters
discussed in this news release contain forward-looking statements that involve
risks and uncertainties that could cause actual results to differ materially
from those set forth in the forward-looking statements. Matters relating to the
Company's traffic, business expansion and initiatives, subscriber growth, and
site usage reflect current information and involve certain risks and
uncertainties, including, without limitation, changes in product demand, changes
in competition and other economic conditions. These statements may or may not be
indicative of future demand and developments. Risks and uncertainties are
described in the company's filings with the SEC. Prospective investors are
cautioned not to place undue reliance on forward-looking statements. .
FreeRealTime.com undertakes no obligation to update or release publicly the
result of any revisions to these statements that may be made to reflect future
events, developments or circumstances. The Jefferies Strategic Alliance has been
entered based on a letter of intent. We will commence negotiations on definitive
agreements; however, there can be no assurance that we will be able to enter
into such definitive agreements or, if we do, that we will realize any benefits
from the strategic alliance with Jefferies. We have received executed
subscription agreements that fulfill the difference between the maximum
authorized $10 million private placement and the first closing on the minimum
financing condition of $7.5 million; however, there can be no assurance that
such subscription agreements will be funded or that the maximum $10 million
private placement will be closed.
CONTACT:
Charles Messman Jefferies & Co, Inc.
Todd Kehrli Tom Tarrant
MKR Group (203) 708-5989
415-934-6811 [email protected]
[email protected] www.jefco.com
[email protected]
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