Tuesday November 9, 9:51 am Eastern Time
Company Press Release
Virtual Technology Signs Definitive Agreement to Acquire
the Operating Assets of Tech Squared Inc.
MINNEAPOLIS--(BUSINESS WIRE)--Nov. 9, 1999--Virtual Technology Corporation
(OTCBB:VTCO - news), a rapidly expanding global e-commerce company specializing in computer
hardware, software, consumer electronics and related services, today announced it has signed a definitive agreement to acquire
substantially all of the operating assets of Tech Squared Inc. (OTCBB: TSQD - news) for a purchase price of approximately
$3.0 million, subject to certain adjustments. Tech Squared, based in Minneapolis, is a national marketer and distributor of mid-
to high-end microcomputer hardware, software and peripherals primarily to businesses in the desktop publishing, graphic arts
and pre-press industries, as well as an emerging customer base of internet and intranet site developers. Tech Squared's 1998
operating revenues were $38.8 million.
The asset sale to VTC includes Tech Squared's Net Direct, DTP Direct and distribution operations together with various trade
and Internet domain names, including netdirect.com, dtpdirect.com and tech2.com. In connection with the purchase, VTC plans
to expand and leverage Tech Squared's manufacturer relationships with Apple Computer, Inc. and other major suppliers. VTC
believes that Tech Squared's manufacturer relationships, together with VTC's existing arrangements with IBM, Hitachi, Hewlett
Packard, Sony and other hardware and software manufacturers, will greatly enhance each customer's shopping experience and
satisfaction.
VTC believes it will generate significant growth through access to the 138,000 business customers in Tech Squared's catalog
and telemarketing databases. VTC intends to maximize these relationships by leveraging its e-commerce model and supplying
24-hour Web site service. In turn, VTC believes that Tech Squared's business-to-business telemarketing group will help expand
VTC relationships with its existing small business customers.
Commenting on the acquisition, Greg Appelhof, VTC's President and Chief Executive Officer, said, ''This investment cements
the strong fit of Tech Squared's business with both VTC's online retail store (www.virtual-world.com) and product distribution
operation. We think this acquisition is an extremely cost efficient way for us to grow infrastructure and acquire a very valuable
customer base. The addition of Tech Squared's inbound and outbound telemarketing group with VTC's existing sales staff will
allow VTC to grow its higher-margin business-to-business customer base and related sales.''
Appelhof noted that closing on the acquisition is subject to various conditions, including shareholder approval of Tech
Squared's shareholders and receipt of financing by VTC.
ABOUT VIRTUAL TECHNOLOGY CORPORATION
Virtual Technology Corp. (VTC) is an e-commerce company specializing in the sale of high-performance computer hardware,
software and peripheral products to sophisticated computer users. The Company provides end-to-end e-commerce solutions
through four primary business units: an ''e-tail'' Web site located at www.virtual-world.com offers more than 60,000 choices of
brand name computer products and over 100,000 software titles; Graphics Technologies Inc. (www.graphicstech.com) a 12
year old wholesaler and distributor of high-end computers and graphic products with seven regional offices and 1998 net sales
of $65 million; Techmart, a provider of private label community shopping Web sites as well as the required inventory, fulfillment
and transaction processing systems; and a technology product auction service located at www.auctions.vtechco.com. |
