United States, In... GPS,... "Government Payment Services (“GPS”) began its operations in September 1997, as a provider of value-added services to government agencies and their customers, and private-sector businesses and their customers. Its primary focus is to enable consumers to use their credit cards to pay any government fee, including but not limited to, cash bail, traffic citations, child support, fines and various other fees. Although GPS has done this through the use of live operators, 24 hours per day, seven days per week, it plans to develop an interactive website and is planning to install an interactive voice response system. By providing innovative, practical and top-quality services that saves its clients time, improve on their methods of collecting fees, and, if possible, that increase the amount of fees they collect, GPS is well on the way to its goal of achieving maximum return for its shareholders. GPS management is focused on maintaining a profitable business, and sustaining, at a minimum, double-digit annual growth, and is currently experiencing approximately 54% quarterly-growth over the same period last year. GPS has been profitable for the past five (5) quarters. By combining its operational and contracting expertise with its credit card transaction processing experience, GPS has been able to provide its government and private sector clients with a reliable and secure service at no charge to them. Consumers who use the system pay GPS a convenience fee that is added to the amount of their transaction. Beyond convenience, the consumer gets to extend its time to pay (due to credit card float) and may receive mileage points. GPS has become the industry leader by continuing to focus on its market niches within the industry i.e. cash bail and child support payments. We have demonstrated that longer-term contractual commitments are permitted in these areas, which is something that will benefit GPS in the future. By contracting first with the criminal justice community in a particular county or municipality, GPS’ credibility is quickly recognized by other government officials in the same jurisdiction. That credibility, along with GPS’ “piggyback clause” within contracts, has been the key to expanding its services to the other agencies. We believe our payment solutions are attractive to government entities because they provide an added service to consumers while reducing paperwork, and possibly costs. Many government entities, as well as private-sector organizations, lack the expertise, technical personnel and economies of scale, to cost-effectively implement and maintain the hardware and software necessary to accept credit card payments from consumers by telephone or through the Internet. Our services are designed to work with a client’s existing information systems, require minimal implementation and are provided at no cost to the client. Executive Summary (continued) In 1997, VISA revealed that within the credit card industry, $266 billion per year was appropriate for payment by credit card to government agencies; yet at that time only 2% is being processed by credit cards. Further analysis has shown that the market may be as great as $600 billion or more. Competition certainly exists and is growing, however, few have invested their resources in the market niche GPS has established in the areas of cash bail and child support payments. As GPS continues to develop new and existing government relationships, management continues to seek ways to “leverage” those relationships by networking with its clients, and their non-government colleagues. As a result of its exposure GPS has received inquires about expanding our service to other areas, including the collection of utility payments. We believe that by networking our history and credibility with our government clients, we could obtain a large market share of payments for utilities by credit cards. This will not interfere with our current efforts and it will bring increased revenues into the company. GPS management believes a business can only be successful in the long run by maintaining profitability. Additionally, GPS management believes there are significant opportunities for explosive revenue growth within its current market niches. As such, GPS management believes that by developing strategic partnerships, it can grow exponentially, meet or exceed forecasts and increase profitability during calendar year 2002. Management has identified a method of increasing revenue by partnering with Associations involved in serving criminal justice agencies. Specifically, GPS will: · Partner with at least two Associations nationwide, at a rate of one per quarter, beginning in November, 2002 and ending in June, 2003. Such expansion is projected to generate increases in sales for the fiscal years ended 2002 and 2003 in the amount of $2.6 million and $6.2 million, respectively. · Increase the number of City Government customers by 50, County government customers by 150, and private companies by 100. Once the necessary infrastructure is in place, GPS will begin to further develop its relationships with the federal government to dramatically expand its work in the areas of child support payments. · Upgrade network and PC stations · Develop competitive employee benefit package (i.e. medical insurance, group life, 401(k), etc.) in order to attract and retain talented employees. · Complete software applications integrating the live operator system, reconciliation process and statistics for improved operational and financial tracking · Expand its relati...