GemPlus Litigation

A federal court jury in San Diego yesterday awarded $17.5 million in damages to Humetrix, Inc. in a breach of contract and breach of partnership action against Gemplus, S.C.A.. The jury ruled that Gemplus’ actions caused a $15 million loss in potential profits for Humetrix. The jury also awarded $2.5 million in additional damages. The dispute centered over a 1995 agreement in which Gemplus agreed to a five-year contract designating Humetrix as a reseller of health-care applications of Gemplus smart card products in the U.S.. The contract also provided Humetrix with royalties for 10 years. Humetrix was in the process of developing ‘VaccicardT’, a smart card to track immunization records for infants, in the U.S., as well as other health care applications, when Gemplus breached its contract and partnership with Humetrix. Humetrix also filed a claim seeking priority trademark rights over the trademark “VaccicardT.” The jury awarded Humetrix with ownership of the trademark, but Humetrix made no claim of monetary damages on that count.

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Frequent Traveler e*Assistant

The Frequent Traveler e*Assistant application combines usage-motivating rewards — air miles for air time — with personalized and on-demand flight information to create a value-added service with special appeal to business travelers. In addition to providing frequent flyer miles as a reward for airtime usage, the Frequent traveler e*Assistant application from Schlumberger uses smart card-enabled push/pull technology to deliver personalized flight information. When a subscriber books a flight on a participating airline, the subscriber will have the option of automatically receiving the following information and alerts delivered via his/her hand set:

— Flight confirmation and schedule

— Two-hour reminder alert before flight time

— Gate information when assigned

— Alerts about gate changes, flight delays or cancellations

— Alert when the plane is beginning to board

The subscriber also has the option at any time to access information, including:

— Flight status

— Information on earlier and later alternate flights

— Direct connection to airline travel assistance operators

This program enables mobile phone operators and airline companies to combine the air-time for air-miles reward program with a complementary service for their most important common customers.

“GSM operators must differentiate their services in order to retain customers and grow their subscriber base,” stated Sami Nassar, director, Telecom, Schlumberger Smart Cards & Terminals, North America. “Smart cards enable operators to quickly, easily and cost-effectively offer a wide range of services that appeal to high usage groups within their subscriber base. Business travelers are typically intensive users of mobile phone services; and GSM providers can use the Schlumberger smart card-based Frequent Traveler e*Assistant loyalty application to win and retain `road warrior’ business.”

Nassar noted that awards programs were identified as one of the leading services preferred by consumers in a recent nationally projectible omnibus phone survey sponsored by Schlumberger. “Next to prepayment options, consumers named frequent caller reward programs as the most appealing mobile phone service.”

Schlumberger provides smart card-based solutions that enable operators to offer value-added services aimed at growing subscriber base and increasing airtime usage. In late 1998, Schlumberger introduced Schlumberger Mobile Solutions, a complete suite of smart cards, software systems, services and application development expertise that meets GSM operators’ current needs, while offering Java(tm)-based technology to enable a new generation of downloadable, value-added services.

About Schlumberger

Schlumberger Smart Cards & Terminals is the leading provider of smart card-based solutions worldwide, shaping the new world of smart solutions by providing leading-edge technology to enable innovative smart card and terminal applications that enhance the security and convenience of businesses and communities of all kinds. Schlumberger smart card solutions encompass a wide range of cards, terminals, development tools and support in open configurations for operators, developers, integrators and distributors worldwide. As part of the Smart Village(R) vision, the Schlumberger offer includes the milestone Cyberflex(tm) card, the industry’s first Java(tm)-based smart card. The Smart Cards & Terminals group operates 45 facilities in 34 countries across the globe. Additional information is available on the World Wide Web at .

Schlumberger Test & Transactions is the parent division for Schlumberger Smart Cards & Terminals and Schlumberger Automated Test Equipment, leveraging the combined strengths of the two business units to provide leading-edge, cost-effective solutions to customers.

Schlumberger Test & Transactions is a business unit of Schlumberger Limited, a $11.82 billion global technology service company providing oilfield services, natural resources management, transactions-based technology and associated systems, and semiconductor test equipment.

Cyberflex is a trademark and Smart Village is a registered trademark of Schlumberger. Java is a trademark of Sun Microelectronics.

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GO TransPort

GO Software and NOVA Corp., rolled-out a new Internet end-to-end payment solution Monday. The new solution brings together NOVA’s new NOVA ‘TransPort’ technology and GO Software’s suite of new merchant payment processing software products. The GO suite includes: ‘PC-Charge’, ‘Win-Charge’, ‘active-Charge’ and ‘IP-Charge’. The NOVA-GO product will enable any Windows PC with an Internet connection to process credit card payments in real time over the Internet. NOVA ‘TransPort’ provides a mechanism to process encrypted credit card transactions over the Internet using standard TCP/IP protocol directly to NOVA for processing. Both Georgia firms said that sending encrypted transactions directly to NOVA the typical processing time will drop from 15-20 second to 3-5 seconds.

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MasterCard Valentine’s

MasterCard announced this morning a special “Shop Smart! For Your Sweetheart” Internet site packed with special offers for MasterCard cardholders. Shop Smart! is a MasterCard Internet-based program designed to help consumers benefit from the choice, convenience and value offered by over 400 Shop Smart! online retailers. More than 160 Shop Smart! merchants offer special values for customers who pay with a MasterCard.

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TWA Phone Card

Carrier Services, Inc., TWA and Sprint have all teamed up to offer the ‘Prepaid Aviators Phone Card’. The prepaid card will offer members of TWA’s ‘Aviators’ program long distance service, plus the benefit of bonus miles credited directly to their Aviators portfolio. Each $50 card carries 170 minutes of high quality Sprint calling time along with 500 Aviators miles. OR-based CSI operates under the proprietary brand 1-800-PRE-PAID.

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Paymentech Deal

Paymentech announced from the Cellular Telecommunications Industry Association’s Wireless ’99 convention that PageNet, Western Wireless and AccessLine have selected Paymentech to process their automatic payment programs for recurring billing. The recurring billing, or recurring payment, electronic solution enables these wireless and enhanced communication service providers to automatically receive payments from customers that are billed on a monthly or regularly scheduled basis.

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Logical Design Testing

Logical Design Solutions, Inc., a provider of Web-based professional services, announced that it has been selected to conduct usability testing for FundsXpress, Inc.’s Internet banking services for community bank customers throughout the United States.

FundsXpress Inc., located in Austin, Texas, is an Internet technologies company that provides secure, reliable Internet Banking capabilities to banks and other financial institutions. FundsXpress’ service bureau approach uses a secure data center to host client bank Web sites and perform financial transactions. Full retail and commercial services are available and typical retail financial transactions include bill payment, account balances and funds transfers. FundsXpress provides all the hardware, software and interfaces necessary for banks to have a secure Internet banking Web site. With the services from FundsXpress, financial institutions have a cost-effective means of offering Internet banking options to their customers.

“LDS is well-known for its world-class Usability Center in the heart of New York City’s financial district,” said Mimi Brooks, founder, president and CEO of Logical Design Solutions. “FundsXpress has asked us to develop and conduct tests to evaluate the effectiveness of the user interface design – such as how easy is it to use this test data will then be shared with FundsXpress in a detailed report.”

“We are very familiar with LDS and their commitment to customer service and quality products. FundsXpress shares the same goals. We want our Internet Banking offering as well as our other financial products to be well-designed and easy to use,” said Gary E. Fendler, Executive Vice President at FundsXpress. “LDS is an expert in these areas.”

The Usability testing will be completed by early March. LDS has also been engaged to deliver a paper “prototype” to visually depict the suggested changes resulting from the Usability tests.

More About FundsXpress

Based in Austin, Texas, FundsXpress is a leading Internet-based financial service network that provides everything a bank needs to offer Internet Banking to its customers. FundsXpress has been exclusively endorsed by the 730 Independent Bankers Association of Texas and the 650 member Community Bankers Association of Illinois. FundsXpress, who recently raised $10 million in a private equity placement and has agreements to provide Internet banking services with over 60 financial institutions, offers an affordable, fast, and highly secure environment for financial institutions to meet their customer’s demands.

More About Logical Design Solutions, Inc.

Logical Design Solutions, Inc. (LDS) provides customized Web-based business solutions to Global 2000 companies in a variety of market sectors including the telecommunications, healthcare, and financial services industries. The Company consults, architects, designs, and builds award-winning enterprise scale Intranets, Extranets and Web-commerce systems for multi-national companies. For additional information, call (800) ASK-LDSI, or visit the Logical Design Solutions Web site at [www.lds.com][1].

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

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So-So December

American consumers added more than $2 billion in revolving debt during December according to preliminary figures released Friday afternoon by the Federal Reserve. During the fourth quarter consumers added more than $4 billion to revolving debt. For December 1997 revolving credit card debt grew at annual rate of 2.0% versus this year’s 4.7% annual rate. According to preliminary data gather by CardData, bank credit card debt totalled $450 billion by year end 1998. Overall consumer credit is growing 6.7% annually according to the FRB. At the end of December, American consumers were $1.308 trillion in debt, exclusive of home mortgages.

REVOLVING CREDIT
HISTORICAL

Dec 98 Nov 98 Oct98 Sep98 Aug98 Jul98 Jun98 May98 Apr98 Mar98
%GRWTH: 4.7% -1.5 10.1 8.1 11.3 -3.8 9.2 -1.4 5.4 9.1
$OWED: $558.6 556.4 557.1 552.5 548.7 543.6 545.3 541.2 541.8 539.4

Source: Federal Reserve; revised figures as of 02/05/99;
For complete historical data visit www.carddata.com.

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Datacap’s DataTran

Paymentech’s Host And Terminal Capture Networks Available Via Datacap’s DataTran

Datacap Systems, Inc., a leading provider of integrated payment systems, announces the availability of Paymentech’s host and terminal capture interface via DataTran. The new releases support credit, debit and check processing for existing Paymentech point-of-sale processing applications that have been supported by Datacap products for years at thousands of payment points.

DataTran is a powerful integrated payment interface that enables any business system, regardless of hardware or operating system platform, to communicate with payment processors for card and check verification. Retail systems developers interfaced to Datacap’s current Universal Application Interface can now make Paymentech’s host and terminal capture services available to their merchants.

‘Paymentech has very aggressively pursued markets that increasingly demand integrated terminals,’ said Terry H. Zeigler, Datacap President. ‘Combining Paymentech’s marketing power and Datacap’s access to business systems developers creates significant opportunities for both companies to penetrate new markets.’

‘Datacap is widely recognized as a reliable provider of payment solutions for all types of business systems,’ said George E. Wilcox, Paymentech’s group manager for retail product management. ‘This certification will increase Paymentech’s reach into the integrated systems market, and add to our flexibility in obtaining Transactions from virtually any business systems.’

For more information call Datacap at (215) 997-8989, or Visit our Home Page on the Web at http://www.dcap.com.

Datacap Systems, Inc.

Datacap Systems, Inc., has successfully designed, manufactured and marketed integrated credit/debit/check certification systems, point-of-sale registers and software for retail systems for over 15 years. Datacap’s experience with business system developers and banks/processors has guided the development of products and services that help banks obtain transactions from integrated business systems, and makes it easy for merchants to get their business systems activated and support for payment verification. In the process, Datacap has created partnering relationships between business systems providers and banks for rapid deployment and support of integrated payment verification solutions.

Datacap’s payment verifications interfaces are designed to allow virtually any system, regardless of operating system or hardware platform, to get easy access to payment processing networks for credit, debit, check, EBT and loyalty program processing. Datacap’s products are used in retail, mail/telephone order, hospitality, quick service, lodging, petroleum, parking, auto rental, convenience, medical and government applications.

Paymentech, Inc.

Paymentech, Inc. founded in 1985, provides full-service electronic payment solutions for direct merchant clients as well as third-party transaction processing. Paymentech also offers complete commercial card payment and information programs to businesses and other entities. Paymentech (www.paymentech.com) is the third largest processor of bankcard transactions and a leading issuer of commercial cards in the United States.

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Sub-Prime Woes

Los Angeles-based Bank Plus Corp. continues to deal with mounting delinquencies and chargeoffs from its venture last year into sub-prime credit cards. According to information released Friday afternoon overall delinquencies (30+ days) hit 22.21% as of Jan. 31. At year-end ’98 delinquency stood at 21.26% and at year-end ’97 delinquency logged in at 10.65%. The bulk of the delinquencies were coming from a sub-prime card program marketed by MMG Direct, Inc. where the 30+ day figure hit 33.57% as of Jan. 31. Bank Plus has terminated all of its sub-prime programs. The bank said Friday that all litigation with American Direct Credit LLC, one of the sub-prime marketing partners, has been dismissed with prejudice. The firm also confirmed Friday that its real estate secured credit card program with First Alliance Mortgage Company has stopped originating new credit card accounts.

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EarthLink VISA

First USA’s e.card program has been answered as EarthLink and MBNA America Bank announced this morning the new ‘EarthLink VISA Card’. Based Pasadena, CA, EarthLink provides access and hosting solutions to thousands of communities internationally from more than 1,700 points of presence. The company is a haven for Mac users and is the default ISP on Apples iMacs computer. The firm recently formed a broad business relationship with Sprint. Card incentives include: $5 in ‘EarthLink Cash’ immediately upon credit card approval; 2% back on purchases made at the EarthLink Mall; and 0.5% back on any Internet or offline purchases.

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Car Calling Card

OH-based Reynolds and Reynolds Company introduced prepaid calling card program to assist automotive marketing. The program was developed by Calling Card Promotions, a partnership between Reynolds and MCI WorldCom, and was unveiled at the National Automobile Dealers Association Annual Convention in San Francisco last week. Reynolds’ Calling Card Promotions uses customized or standard prepaid calling cards and includes incentives such as: “1-800-DRIVE ME” rewards new customers with phone minutes for test driving new models; “Consumer Rewards” , a calling card key chain presented to a customer as a thank-you for visiting the dealership with an opportunity to receive 1000 free minutes if they return and purchase a vehicle; “Passport Minutes”, a retention program giving customers free minutes for using dealership services; “Motivation Plus”, a program designed for rewarding top employees throughout the dealership; and “Pocket Billboard” which prints business cards on a prepaid calling card.

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