TV Smart Cards

As general acceptance of smart cards in the U.S. begins to build, new, sexy technologies for loyalty applications will explode. St. Louis-based VEIL Technologies is promoting a system which allows consumers to electronically download promotional coupons from a television commercial directly onto a smart credit card. Indeed, Target indicated this week it is focusing on developing a loyalty function with its upcoming launch of a co-branded ‘smart VISA’ that could enable a cardholder to download electronic coupons onto a smart card from a PC. The patented VEIL technology allows digital information to be invisibly delivered by an ordinary television’s video image, allowing individuals to download offers during encoded commercials from a television monitor, without any external devicies such as set top boxes. With VEIL technology added to a smart card, consumers could download offers from television, electronic kiosks, monitors, then present their ‘VEIL’ enhanced smart card to pay for their goods/services using the same card. “VEIL” stands for “video encoded invisible light”. In October, the company demonstrated its technology in conjunction with an interactive promotion created for Ericsson Mobile Phones during ABC’s “Who Wants to Be a Millionaire.”

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Smart Chip Funding

Schimatic Cash Transactions Network, d.b.a. Smart Chip Technologies, Inc. announced that it has retained WestPark Capital Partners, LLP [www.wpcapital.com][1] as a business and financial advisor. WestPark, with offices in the United States and Hong Kong, is advising the Company on organizational and financial matters, and assisting the Company in pursuing necessary financing and strategic/financial relationships. West Park has a successful history of advising its many clients in funding and/or business combinations, including clients in the electronic payments industry. As compensation for its services, WestPark will receive a small cash retainer in addition to fees for accomplishment of a successful second stage funding of the Company.

Over the next several weeks the Company expects to evaluate and pursue a number of selected business combinations or joint venture alternatives identified by WestPark which involve established companies with business interests which are related to, or strategic to, the Company’s business.

The Company anticipates that pursuing these possible funding/joint venture arrangements may require reorganization of the Company’s operations, including the possible creation of an operating subsidiary.

‘We are confident that this step will substantially enhance our positioning in the industry and our ability to attract necessary capital together with strategic relationships,’ said Jim Williams, Smart Chip Technologies’ President and CEO. ‘West Park has a demonstrated ability to guide small companies in their capital formation. We are very gratified to have advanced our Company to the point where we could secure this caliber of professional assistance.’

About Smart Chip Technologies

Smart Chip Technologies [OTCBB: SCTN] is a Software Technology Company with a patent protected loyalty application for use in the smart card and wireless environment. SCTN licenses its patented e-llegiance’ multi-platform smart chip loyalty application that is engineered for EMV, Global Platform, and MULTOS compliance. The software is designed to operate on smart cards, POS terminals, and smart devices such as PDA’s. SCTN also provides complete loyalty program management, transaction processing, and accounting services through its LoyaltyCentral’ software and back office operation. The e-llegiance’ and LoyaltyCentral’ solutions provide maximum flexibility in the management of click-and-mortar incentive programs, establishing business continuity across the physical, mobile, and virtual worlds. ([www.sctn.com][2])

About WestPark Capital

WestPark Capital, Inc., member NASD/SIPC, is a full service investment banking firm, which serves the capital needs of a broad spectrum of emerging growth companies. WestPark’s experienced professionals focus primarily on middle market, emerging growth companies and provide all aspects of financial advisory services, such as: initial public offerings and secondary offerings, private placements of equity and debt, merger and acquisition advisory services, fairness opinions, bankruptcy / restructuring advisory services with global capabilities. WestPark’s office locations include:

Century City Office: 2049 Century Park East, Suite #3310, Los Angeles, CA 90067 Phone: (310) 843-9300, and

Irvine Office: 2600 Michelson Drive, 17th Floor, Irvine, CA 92612 Phone: (949) 852-3610

[1]: http://www.wpcapital.com/
[2]: http://www.sctn.com/

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DataWave Cards

DataWave Systems has completed initial development of its innovative cash card delivery and authorization infrastructure. The first unit was installed in the U.S. marketplace this week, and will allow consumers to purchase prepaid cards, which are activated real time through the DataWave network.

The DataWave solution provides comprehensive customer support and transactional detail through live customer service and web based interfaces. DataWave has launched their interactive website, [www.mycardstatus.com][1], which will allow customers to access their card balance, transaction history & statements online. They can also add more funds to their card, update their personal information and report a lost or stolen card.

“The timely launch of this program is a key milestone,” says Josh Emanuel, President and CEO of DataWave, “as it proves DataWave’s ability to quickly deliver new and innovative multi tiered solutions to the financial marketplace. We are extremely optimistic that our efforts and investment over the past months will yield many exciting opportunities in the prepaid marketplace.”

About DataWave ([www.datawave.ca][2])

DataWave Systems designs, develops, produces, owns and manages a proprietary, intelligent, automated direct-merchandising network, comprised of free-standing intelligent machines (DTMs) and over the counter “swipe” units (OTCs) connected to the gateway and database software through a wireless and/or landline wide area network. This unique leading-edge technology provides for point-of-sale activation, cash/credit card acceptance, detailed reporting and 24/7 remote self-diagnostic troubleshooting, making it virtually maintenance-free. The Company has proven enabling technologies that have allowed it to enter new markets and generate additional revenue streams with innovative prepaid and financial services products. In addition to its successful prepaid calling card business, the company is testing the distribution of the Michigan National Bank Prepaid MasterCard together with Coinstar.

DataWave is now poised to capitalize on the flexibility of its System by augmenting its product range to meet the diversified and changing needs of the prepaid market and in further developing strategic partnerships.

[1]: http://www.mycardstatus.com/
[2]: http://www.datawave.ca/

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HOUSING PAYMENTS

Trintech Group Plc, a global provider of
secure electronic payment infrastructure solutions for real world, Internet
and wireless environments, announced a deal to provide allpay.net, one
of the largest payment networks in the UK, with a comprehensive electronic
payment solution for the UK housing market.

The Trintech and allpay.net integrated solution will simplify the
processing of payments across multiple networks. Based on an estate of
terminals and dedicated PayWare software supplied by Trintech, the solution
will bring together existing payment networks through one terminal. This
automated system will replace a manual paper based system and will offer a
streamlined payment solution to allpay.net’s customers, making administration,
maintenance and control easier and more efficient.

“As a leading payment network, allpay.net Limited currently processes ten
million transactions annually,” said Tony Killeen, Managing Director,
allpay.net. “With this agreement, we estimate that the potential for
collecting revenue in the housing market alone could be in excess of
GBP250. Signing this agreement is an important step forward for us as an
organization, allowing us to consolidate our position as leader in outsourced
payment collection as well as improving convenience for payees and control for
housing organizations,” he added.

Nick Newman, Managing Director, Trintech Limited (UK) welcomes the deal:
“This agreement demonstrates the value of a multi-application,
multi-transaction payment solution that provides customers with a convenient
one-stop method of paying for a wide range of services. Improving the
convenience and accountability of payments is an ideal way for us to
demonstrate the potential of this solution and we are confident that we can
leverage this infrastructure for additional value added services such as
utility and ticketing.”

The solution supplied to Housing Associations, Councils, Insurance Houses,
Magistrates Courts and Debt Collectors provides scope for increasing the types
of transactions that can be accepted in future, allowing allpay.net’s clients
to maximize the service provided by a single terminal while minimizing the
cost of processing. The system can also be utilized by anyone to request
regular cash payments.

As part of a fully managed service, allpay.net provides its customers with
unique identification cards that are swiped in the terminal to identify the
transaction type. The service will allow payments to be made by card, cash,
credit and debit cards, record payments received and issue a receipt to the
payee. At the end of each day the payment data is sent to allpay.net’s
servers at its Herefordshire headquarters. A file is then returned to the
client with confirmation of payments received so that the payee’s records can
be updated.

The solution features the latest desktop terminal from the PayWare Compact
9000i range, specially developed to integrate all the existing networks that
allpay.net utilizes; such as the PayPoint, Payzone (De La Rue) and Billpay
(Post Office Counter) networks. With 9,000 devices already scheduled for
deployment, this number is set to increase to include council offices,
newsagents and other retailers.

PayWare Compact 9000i Product Overview

The PayWare Compact 9000i(TM) provides maximum versatility and high
security to meet the varied needs of large and small retailers, either in
stand-alone or networked installations. It has a high speed thermal printer
and uses a new modular software architecture which facilitates the future
deployment of new payment applications, such as loyalty and smart card
programs.

About Trintech

Founded in 1987, Trintech is a leading provider of secure electronic
payment infrastructure solutions for card-based transactions for physical
world commerce, eCommerce and mobile commerce. The company offers a complete
range of payment software products for credit, debit, commercial and
procurement card applications, as well as being a world leader in the
deployment of payment solutions for Internet commerce that are fully SSL and
SET(TM) compliant. Trintech’s range of scalable open systems architecture
solutions for UNIX(R) and Windows NT(TM) platforms covers consumer, merchant
and financial institution requirements for physical payments and the emerging
world of electronic commerce. Trintech can be contacted in the U.K at 186-192
Darkes Lane, Potters Bar, Herfordshire EN6 1AF (Tel: +44 1707 827000), in the
U.S. at 2755 Campus Drive, San Mateo, CA 94403 (Tel: 650-227-7000) and in
Ireland at Trintech Building, South County Business Park, Leopardstown, Dublin
18 (Tel: 353-1-207-4000). Trintech can be reached on the Web at
http://www.trintech.com .

About allpay.net

allpay.net Limited provides a service to collect payments through the
supply of plastic cards and terminals throughout various central payment
points to collate payments from anywhere within the UK. The cards are
accepted via easily accessible outlets throughout the country such as:

— 19,000 rural & city Post Offices, 7400 PayPoint outlets — including
newsagents, convenience stores and garages, telephone direct to allpay.net or
direct to the client, Internet enabled PC and through digital television

— allpay.net Limited has the unique advantage of being able to include
other payment networks. With all information processed through the allpay.net
database it is not necessary for clients to invest in expensive programming or
hardware requirements in order to join individual network providers

— The automated approach can now be introduced into any outlet and can
eradicate the need for paper based systems and provide additional payment
outlets. The electronic method of payment reduces paper chasing and relieves
lengthy payment receipting processes. The use of check digits and automated
transfer of data greatly reduces the human error element associated with
keying information into a keyboard reducing the cost of transactions by up to
75% compared to other networks

— PAYzone currently 5,200 outlets growing to 10,000 once re-branding has
been completed.

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DIEBOLD DEAL

Cable & Wireless Information
Systems Ltd. has reached a distribution agreement with Diebold, Incorporated
, the leading supplier of self-service solutions in the Americas.
Cable & Wireless Information Systems Ltd. will offer installation and
maintenance of Diebold automated teller machines for banks throughout
the Caribbean.

“We have been active in the Caribbean for a number of years, concentrating
on specific islands, including Puerto Rico and the U.S. Virgin Islands,” said
Ernesto Unanue, vice president and managing director, Latin America for
Diebold. “We are truly looking forward to working with Cable & Wireless to
furnish financial institutions in the eastern Caribbean with our high caliber
self-service and security solutions.”

Besides self-service products Diebold offers comprehensive electronic and
physical security products, as well as professional services. Diebold is
considered a pioneer in the manufacture of vaults, safe deposit boxes and
safes, with more than 140 years of experience. Diebold also provides cutting-
edge security products including the popular RemoteTeller(TM) System,
MicroBranch, PassVault and Accutrack Digital Server.

“Tourists visiting the Caribbean expect the same high level of service
they receive when they are at home. Diebold’s proven solutions offer the
consumer a touch-point that is familiar and trusted,” said Glen Smith, general
manager, Cable & Wireless. “Besides enhancing their image with consumers,
banks working with us will benefit from the increased revenues and improved
availability these solutions offer.”

Cable & Wireless Information Systems Ltd. markets and supports computer
based-solutions for businesses in Barbados and the Eastern Caribbean.
Diebold, Incorporated is a global leader in providing integrated self-
service delivery systems and services. Diebold employs more than
10,000 associates with representation in more than 80 countries worldwide and
headquarters in Canton, Ohio, USA. Diebold reported revenue of $1.7 billion
in 2000 and is publicly traded on the New York Stock Exchange under the symbol
‘DBD.’ For more information, visit the company’s Web site at
http://www.diebold.com.

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LATIN AMERICA

MasterCard outpaced VISA in Latin American card growth last year but VISA
continues to dominate the region with a market share of nearly 85%. Gross
purchase and cash volume in Latin America increased more than 27% during
2000 while total transactions increased nearly 26%. MasterCard added four
million new cardholders last year to bring its total Latin America cards to
29.6 million. VISA holds an overwhelming lead in merchant acceptance
locations by nearly a two to one ratio. Among the fastest growing Latin
America countries with at least US$1 billion in volume: Mexico, Argentina,
Dominican Republic, and Costa Rica.

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VTMs

The Bush-Gore election hanging chad debacle may be a thing of the past as ATM leader, Diebold, moves deeper into electronic voting machines. Diebold announced this morning it has signed a non-binding letter of intent to acquire Toronto-based Global Election Systems. Diebold says it projects the U.S. voting marketplace to generate $1.5 to $2.0 billion in hardware revenue during the next four to five years. Last year Diebold’s Brazilian subsidiary, Procomp, supplied the world’s largest nationwide voting system, used by 109 million voters, during elections held throughout Brazil. The GES acquisition is expected to be completed during the third quarter.

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GES ACQUISITION

Diebold, Incorporated announced it has signed a non-binding letter of intent to
acquire Global Election Systems Inc.. This
transaction is subject to certain conditions, including the completion of due
diligence, the negotiation and execution of definitive agreements and the
approval of the merger by Global’s stockholders.

The agreement in principle includes a stock-for-stock transaction valued
at $1.50 per common share of Global Election Systems, subject to a maximum of
.05 Diebold shares and a minimum of .04 Diebold shares per Global Election
share. Global has approximately 21 million shares outstanding. Diebold will
also provide $5 million of immediate financing to Global. Diebold expects the
acquisition to be neutral on 2001 earnings and accretive in 2002. The
acquisition is expected to be completed during the calendar third quarter.
Diebold is entitled to a breakup fee in certain circumstances if the
acquisition is not completed.

Diebold and Global also signed a contract manufacturing agreement where
Diebold will produce more than 500 AccuVote-TS touch screen voting terminals
to fulfill a contract previously secured by Global.

“This action will complement our existing core competencies in self-
service technology and security,” said Walden W. O’Dell, Diebold chairman,
president and chief executive officer. “Global is an industry leader with
excellent voting solutions, and provides Diebold with considerable expertise
and knowledge of the U.S. election solutions market.”

O’Dell continued, “With Diebold’s solid financial position, manufacturing
capability and a nationwide service and support organization, we will become a
formidable solutions provider for the elections industry. We expect the U.S.
voting marketplace to generate $1.5 to $2.0 billion in hardware revenue during
the next four to five years. This acquisition allows us to immediately
capitalize on this expanding market, rather than undergo the lengthy
certification and development process necessary to enter the market with our
Brazilian product.”

Last year Diebold’s Brazilian subsidiary, Procomp, supplied the world’s
largest nationwide voting system, used by 109 million voters, during elections
held throughout Brazil. Procomp provided the Brazilian government with a
turnkey voting system, including more than 180,000 voting terminals,
accessories, software, installation, training, logistics and support.
Global Election Systems Inc., is an industry leader in the election equipment
marketplace with over 850 jurisdictions in North America utilizing its
AccuVote (optical scan) or AccuVote-TS (touch screen) voting systems. Its
product line also includes VoteRemote, a high speed automated absentee ballot
printing and processing system. Global’s acquisitions and strategic alliances
have enabled the Company to participate in international bids involving
nationwide voting system projects.

Diebold, Incorporated is a global leader in providing integrated self-
service delivery systems and services. Diebold employs more than
10,000 associates with representation in more than 80 countries worldwide and
headquarters in Canton, Ohio, USA. Diebold reported revenue of $1.7 billion
in 2000 and is publicly traded on the New York Stock Exchange under the symbol
‘DBD.’ For more information, visit the company’s Web site at
http://www.diebold.com .

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OPTICAL ID CARDS

The Government of Saudi Arabia’s RFP (request for proposal) is calling for a national ID card program
utilizing a “Smart Optical Card,” which is a card with an optical memory and an IC chip.

The request for proposal includes the following card specifications and requirements:

— Cards must support the capability to insert an IC chip within the card (“Smart Optical Card”) that
meets the relevant ISO/IEC 7810 standards.

— Data capacity of the optical card must be at least 2M bytes with Error Detection and Error Correction
(EDEC) for burst errors.

— Cards must meet the general characteristics for optical memory cards as specified in ISO/IEC
11693.

— Cards must comply with the linear recording methods specified in ISO/IEC 11694 parts 1, 2, 3, and 4.

— Cards must have ThermaPrint backing to support dye diffusion printing.

— The contractor must provide the necessary software to produce a unique personalized embedded
hologram (a visible image, laser encoded into the optical media on the card that is eye-readable under
normal office light, permanent, and unalterable). The hologram should also support the use of covert
machine readable verification by interleaving the digital data version of the hologram with the visible
hologram image.

According to the RFP issued by the Kingdom of Saudi Arabia Ministry of Interior, the intent of this
project is to produce ID cards that fulfill exact requirements as to clarity, durability, and life expectancy.
Two card types will be required — differing in security features, lifetime requirements, and quantities.
“Secure Cards” with a five-year lifetime (denoted as Type T5) calls for a quantity of 4,500,000 cards,
and “Enhanced Security Cards” with a ten-year lifetime (denoted as Type T10) calls for a quantity of
5,500,000 cards. The RFP states that “These cards will be issued by the Ministry of Interior and
distributed through its many offices to the citizens and legal residents of the Kingdom of Saudi Arabia.”

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GemLucence Cards

Gemplus has introduced a new translucent card technology which allows visible light to pass through while creating infrared opacity. The new ‘GemLucence’ cards are available in ‘TechnoTone’ colors including: Cyber, Photon, Enertia, Synergy, Electro, Nitro, Quasar, and Kinetix. Gemplus says that unlike other translucent cards in the marketplace, the ‘GemLucence’ cards permit the execution of three-dimensional graphic treatments in the card design. In the U.S., translucent cards took hold after the introduction of the American Express ‘Blue’ card in 1999 and the MBNA ‘Quantum MasterCard’ last summer. Last September, Providian introduced the first translucent ‘smart VISA’ card. This year the French bank, Banque Directe, introduced a translucent ‘VISA Carte Bleue’ smart card. Schlumberger Test & Transactions also recently introduced a transparent smart card called: ‘Luxea’. (CF Library 6/16/00; 7/7/00; 10/26/00; 4/30/01)

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UATP Member

Universal Air Travel Plan, Inc. announces American Trans Air as the newest airline to join the UATP acceptance network. ATA joins over 180 other airlines worldwide that accept UATP as their preferred form of payment. *In fact, 95 percent of Available Seat Miles worldwide can be purchased using UATP. Airlines around the world have recognized the value of accepting UATP for its low commission costs, valuable data and revenue generation.

Andrea Klein, UATP Regional Marketing Manager, Americas, said, “I received more requests from UATP card-issuing carriers to recruit ATA as a member than any other airline in the Americas region. We look forward to ATA accepting UATP, knowing it will lower distribution costs and expand their base of business travelers.”

“As ATA has grown, so has the number of business travelers flying with us,” said Don Moonjian, ATA’s Vice President of Marketing. “These customers have told us that UATP is important to them. Acceptance of the UATP card fills a void that will allow us to provide yet one more valuable service to that critically important group of travelers.”

ATA, the principal subsidiary of Amtran, Inc. (Nasdaq: AMTR), is now in its 28th year of operation. As the nation’s 12th largest passenger airline, ATA operates scheduled service flights to popular vacation destinations and major business centers. Low fares, electronic ticketing, and advance seat assignments make travel on ATA a customer-friendly experience. To make a reservation, contact your travel agent, or call ATA at 1-800-I-FLY-ATA, or en Espanol at 1-800-VUELA-ATA. If you would like to make a reservation online or learn more about the company, visit ATA’s website at http://www.ata.com .

Universal Air Travel Plan, Inc., formerly known as the Air Travel Card(R), is the world’s first business travel payment system. Founded in 1936, UATP was an innovator in the charge card industry, developing such standards as the magnetic strip and lodged accounts. With annual global billings of over USD8 billion, owned and operated by each card-issuing airline and accepted by virtually every airline in the world, UATP offers the most complete data and lowest administrative cost of any charge product. Multi-national corporations, including 73 percent of the Top 100 Global, utilize UATP to better manage travel expenses. Airlines currently issuing UATP accounts include Aer Lingus, Air New Zealand, Alitalia, Ansett Australia, American Airlines (NYSE: AMR), Austrian Airlines, British Airways (NYSE: BAB), Continental (NYSE: CAL), Delta Air Lines (NYSE: DAL), Japan Airlines (Nasdaq: JAPNY), KLM Royal Dutch Airlines (NYSE: KLM), Lufthansa German Airlines, QANTAS, Scandinavian Airlines System, Swissair, Trans World Airlines (Amex: TWA), United Airlines (NYSE: UAL) and US Airways (NYSE: U). For more information, visit [www.UATP.com][1] .

[1]: http://www.UATP.com/

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Online Banking

Pure online banks are beginning to look like failed dreams according to a new research report. However for traditional banks, online banking, whether through a PC, mobile phone or PDA is no longer a competitive advantage but rather a competitive necessity. Meridien Research says traditional banks are best positioned to take advantage of online banking because customers expect access through branch offices and ATMs as well. Meridien forecasts the number of active Internet banking users worldwide will grow from 23 million today to 32 million in 2003. Most are in the United States and Scandinavia.

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