EUROPAY MID-2001

Mid-year 2001 key business indicators from Europay International Europe’s leading payment system highlight continued double-digit growth.

Figures for the first six months of the year show that 283.2 million cards carrying Europay brands Eurocard®-MasterCard®, Maestro®, eurocheque® and Cirrus© are now being carried by European consumers, a rise of 14% over the same period last year. This translates into thirty-four million new cards 70% of which originated in the UK, Germany, Spain, Italy and Turkey.

The number of Eurocard-MasterCard credit/charge cards rose 14% to reach 73 million. On the debit side, cards bearing Maestro, eurocheque and/or Cirrus brands kept their market lead with 210.1 million cards – a rise of 14%. This confirms their position as European consumers’ preferred debit solutions. Close to 194 million of these cards are Maestro branded.

Europay’s acceptance networks broke the 300,000 barrier with the number of ATMs increasing by 21% to almost 305,500. The number of point-of-sale terminals accepting Maestro jumped 17% to reach over 2.7 million, while close to 5 million merchants now accept Eurocard-MasterCard cards a rise of 12%.

The number of transactions generated by cards bearing Europay brands grew by 15% in comparison with last year, to reach 12 billion. Associated volume increased by 13% and passed the €1 trillion mark.

Dr. Peter Hoch, Europay’s Director and CEO, said “These excellent figures show the popularity of our brands and services with our Members and their customers. As we move closer to our strategic partner MasterCard, these results confirm the strength of Europe as a key player within a global marketplace.”

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Access & Assets Card

Checkpoint Systems, Inc., a leading provider of supply chain management and security solutions worldwide, unveiled a new line of access control readers and cards at the ASIS Show, Booth #1263, Henry B. Gonzalez Convention Center in San Antonio, Texas.

The Performa Proximity Readers and Proximity Plus Cards utilize advanced 13.56 MHz radio frequency identification (RFID) technology that, for the first time, enables the integration of access control and asset tracking capabilities into one system. This new and innovative system will enable a broader range of application requirements to be satisfied as companies continue to look for ways to improve their inventory management capabilities.

Checkpoint’s new Performa(R) Proximity Reader for reading ID badges can be mounted directly on any type of wall or door mullion, including metal, without impacting the performance. In addition, the reader is weatherized to withstand harsh outdoor environments. Its 13.56 MHz RFID technology is the globally accepted frequency and the most advanced technology available.

The Performa(R) Proximity Plus(TM) Cards are also compatible with Checkpoint’s RFID asset tracking product line. The new line of cards are the most reliable available given Checkpoint’s expertise in high-volume RFID tag manufacturing and innovative “flipchip” assembly. The credit card-sized cards utilize a passive, battery-free design allowing for an infinite number of reads and over one trillion unique codes. The cards can be pre-programmed with customer-specific identification numbers and can include graphics quality direct print.

Checkpoint’s Access Control Products Group now provides a single source for securing your facility and tracking important assets. These new cards and readers join the family of Performa products successfully launched in 1999. The Performa line includes paper-thin, flexible passive tags and advanced readers designed to maximize reader range for fixed and portable applications. In addition, Checkpoint offers a complete range of software for access control an asset tracking applications. “The new Performa(R) Proximity Readers and Proximity Plus(TM) Cards leverage Checkpoint’s RFID technology in order to provide a single source solution for access control and asset tracking,” said Dave Shoemaker, group vice president, strategic marketing, Checkpoint Systems. “Checkpoint is continually expanding our product offerings to offer our customers next generation technology and breakthrough, cost-effective solutions.”

Checkpoint Systems, Inc. is a multinational company that manufactures and markets labeling systems designed to improve efficiency, reduce costs and provide value-added labels solutions for customers across many markets and industries. Checkpoint is a leading provider of EAS and RFID systems, source tagging, barcode labeling systems, hand-held labeling systems and retail merchandising systems. Applications include automatic identification, retail security and pricing and promotional labels. Operating directly in 30 countries, Checkpoint has a global network of subsidiaries and provides professional customer service and technical support around the world. Checkpoint Systems, Inc.’s web site is located at [www.checkpointsystems.com][1].

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

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UltraCard Raises $3 Million

Upgrade International Corp. announced that it has received an additional $2.5 million in funding from Antares 2 Pension Fund, managed by Fonditel EGFP, SA., and $500,000 from a private European investor.

Fonditel is the manager of pension assets for Telefonica, the global telecommunications operator headquartered in Spain. Daniel Bland, Upgrade’s President and CEO stated the following: “This financing will enable Upgrade and UltraCard to move forward in our efforts to commercialize the UltraCard and deliver many applications including an alternative solution to a central database model for a national ID card system. UltraCard once commercialized will allow for your entire encrypted biometrics identification system to be stored on the card, thereby eliminating the need to store and verify your personal ID from a government-controlled central database. Not only does this solve the `Big Brother is watching’ concern it also has the potential to drastically reduce the cost of building the database infrastructure. Protecting our borders and our way of life without trampling on our civil liberties should be the number one priority in the information technology business today. We will expend a substantial amount of our resources in fulfilling this obligation.”

About Upgrade

Upgrade International Corp. () through its ownership interest in UltraCard Inc. (), Efornet Corp., and cQue Corporation is engaged in the development and commercialization of a patented ultra high capacity portable data storage technology. UltraCard’s patented method for using existing hard disk storage technology provides both highly durable media in a credit card format and an inexpensive read/write device that together will become the next generation in personal portable data storage for a broad range of existing and new markets. Management believes that the UltraCard technology will potentially provide numerous industrial users with a combination of high levels of security and a vastly greater amount of personal transportable data storage at the lowest cost in the industry. In addition the acquisition and development of existing SmartCard solution providers represents a strategic market strategy designed to accelerate the integration of the vastly superior technology inherent in the UltraCard into existing and newly developing markets.

On Behalf of the Board of Directors, Daniel S. Bland President and Chief Executive Officer

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Magna Printers

Datacard Group has added ‘Advanced Imaging Technology’ to its ‘Magna Class’ card printers. The new technology uses optimized print ribbons to improve the sharpness and quality of photos, graphics and logos printed on full-color and monochrome cards. The results include smoother backgrounds, superior reproduction of fine-text characters, better color matching with cameras and scanners, and low ribbon status. The ‘Magna Class’ includes six printer models that personalize up to 650 one-color cards and 180 full-color cards per hour. Meanwhile, DataCard also announced the latest version of its ‘ID Works’ identification software which now offers navigation in English, French, German, Japanese and Spanish for every solution in the software portfolio. For packages in the ‘ID Works Basic Edition’ and ‘Standard Edition’ families, ‘version 3.1’ enables new translated functionality for card and report design and production. It also enables multi-language navigation for several enhancements previously available only in English, such as ghost photo imaging, transparent color options and variable card sizing.

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BART Upgrade

The San Francisco Bay Area Rapid Transit District has contracted with Cubic Transportation Systems to replace fare collection equipment at the transit authority’s five extension stations with Cubic’s new advanced electronic ticketing system. The $5.5 million order is in addition to the $31 million contract awarded to Cubic in 1999 to put new ticket vending machines and faregates in all but the newer BART stations. The new BART equipment uses a processing architecture compatible with Cubic’s ‘Nextfare Solution Suite’ for advanced integrated ticketing. BART is using Cubic’s ‘Tri-Reader’ technology for integration across its fare collection system to easily facilitate an upgrade to smart cards. The Cubic ‘Tri-Reader’ is the transit industry’s first card reader that processes multiple card technologies, including ‘ISO 14443 Types A and B’ and the Cubic ‘GO CARD’ now in use in Chicago and Washington D.C.

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Relocation Card

Wachovia’s First Union National Bank this morning unveiled its new ‘Relocation VISA Card’ for businesses. The bank says the average relocation cost for a home-owning employee was $57,279 and $16,701 for a renting employee, last year. The new prepaid debit card can be used for POS and ATM cash access. Harris Teeter Stores Inc. is the first client to sign up for the new program. Once companies sign a contract for the ‘First Union Relocation Card’ program, they can request new cards for individual employees online. Companies can establish individual dollar limits and a standard expiration date for their cards. They also can customize cards with their company logo. Each card can be sent directly to the employee, along with card activation instructions and a register for tracking transactions, or to the company for distribution. Companies get regular reports on spending activity. The card is sold and marketed centrally by First Union’s Corporate Mortgage Services.

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Paypal IPO

Paypal’s announced IPO will present an increased challenge to existing credit card issuers for Internet payments, such as Citibank’s ‘c2it’ service. NY-based Celent Communications says it expects financial institutions to lose $375 million in credit card transactions because of email payment schemes by 2003. As a result, Celent says Paypal will face direct assaults from credit card networks reacting to the cannibalization of their revenues over the next two to three years. Paypal currently has a 90% market share and expects to handle $3.5 billion in transactions this year. Although the firm began with a focus on payments delivered via PDAs, the firm shifted early last year to providing email payments on auction Web sites. While the stock market is currently not enthusiastic about IPOs, Celent says the slowing economy and technology bubble burst are Paypal’s strongest allies for preserving its market share. To-date PayPal has racked up more than $230 million in losses since it was launched in early 1999. It expects to raise about $80 million in the IPO. (CF Library 3/7/01; 9/7/01; 10/1/01)

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QualTeq Promotes 3

QualTeq Inc., a leading Visa/MasterCard card manufacturer, announced today the promotions of Karen Sodano*, vice president of Human Resources and Administration; Arturo Cardenas*, director of operations; and Robert Flemen*, network administrator.

Karen Sodano – Karen Sodano, of Greenbrook, NJ, has been promoted from director of Human Resources and Administration to vice president of Human Resources and Administration. In her new role, Ms. Sodano will promote organizational growth through comprehensive training programs, organizational support, and employee management programs. Major components of her role include implementing and administering all personnel policies and procedures within the facility, implementing compensation and benefits programs and promoting career development and education.

Arturo Cardenas – Arturo Cardenas, of Bridgewater, NJ, has been promoted from senior development engineer to director of operations. Mr. Cardenas spearheads direction for all manufacturing, personalization and support service operations, including inspection, safety, and product and materials testing.

The scope of his responsibilities includes directing card manufacturing, personalization, inspecting, health safety and environmental issues relating to OSHA and EPA, maintenance including work flow, equipment and facility requirements and research and development of new products.

QualTeq Promotions’2

Robert Flemen – Robert Flemen of Piscataway, NJ, was promoted from vault administrator IT customer support to network administrator. Mr. Flemen installs, configures and maintains the organization’s operating systems. He analyses and resolves problems associated with the server hardware, NT and applications software.

Mr. Flemen also maintains and modifies existing network operating systems, processes all personalization job orders, and updates operating systems. For more information, contact Scott Magnacca, executive vice president of sales and marketing, QualTeq, Inc., at (908) 668-0999, Ext. 213, smagnacca@qualteq.com or visit the Web site at .

About QualTeq

Based in South Plainfield, NJ, QualTeq has been a leader in secure card manufacturing for almost 20 years, producing over two billion cards since its inception. QualTeq is a single source supplier of card products and services from card design and manufacturing to personalization and card issuance-receiving recent International Card Manufacturer Association (ICMA) Elan Awards for Card Design Excellence. QualTeq is also the first fully integrated secure North American company to offer dual interface cards incorporating contact and contactless technology.

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MAKO Readers

PubliCARD has created a new minority-owned affiliate to market its smart card reader and related integrated circuit technologies. The new affiliate, MAKO Technologies, includes as shareholders, Troy Casey and Yasuo Izuyama, co-owners of Asian Identification Systems, and a sister company, which are PubliCARD’s current smart card reader contract manufacturing and distribution partners in the Asia-Pacific and Latin America regions. Casey and Izuyama will collectively own an initial 54% stake in MAKO. The new firm’s employees have also been granted the right to receive, in the aggregate, a 27% equity stake after two years. PubliCARD has granted a perpetual license of its reader and chip technology to MAKO in exchange for royalties based on sales over the next two years. MAKO will continue to sell the existing ‘Infineer’ lines of smart card readers and chips for keyboard and set-top box readers.

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OPC in TX

Official Payments Corporation announced that the City of Coppell, Collin County, Hays County, Midland County, Lubbock Central Appraisal District, Midland Central Appraisal District, and Round Rock Independent District, all within the state of Texas, have signed service agreements with the company.

These agreements enable citizens to pay personal property and real estate tax obligations over the Internet by visiting www.officialpayments.com, or via telephone by calling toll-free 1-800-2PAY-TAX. The programs will commence within the next two months.

Combined, these local authorities collected over $1.75 billion in personal property and real estate taxes last year. Tax bills will be distributed October 10, 2001 and are due on or before February 1, 2002. American Express, Discover Card, MasterCard and Visa are the cards accepted by the programs.

Official Payments has increased its Texas client base in 2001 by 312% over the prior year, resulting in an increase in market revenue potential of over $5 billion or 260%. Collins County, which includes part of the City of Dallas, contains more than 190,000 parcels and collects over $850 million in personal property and real estate taxes annually. The other seven clients each have annual revenue market potentials of over $60 million.

“We are making significant progress in our business development within the great state of Texas,” said Thomas R. Evans, Chairman & CEO of Official Payments Corp. “Leading Texas communities are signing with Official Payments at a steady rate because we offer unique technical expertise and a proven track record in the emerging government payments market. By offering our systems, these communities are giving their citizens a enhanced level of service,” added Mr. Evans. Two of the company’s established Texas clients, Bandera County and Brazoria County, were recently recognized by the state’s Comptroller of Public Accounts, Local Government Assistance Section, as providing “Best Practices” for their electronic payments systems.

Official Payments has similar agreements with over 900 government entities within 49 states across the country. The company has contacts with the Internal Revenue Service, 18 state governments, and the District of Columbia to collect taxes, fees, and fines by credit card over the Internet and telephone.

Official Payments charges taxpayers a convenience fee for processing these credit card transactions. The fee schedule can be found on the Internet at www.officialpayments.com. For example, a taxpayer who owed $2,300 in property taxes and charged their taxes would find a total of $2,368 on their credit card statement: $2,300 for the tax bill and $68 for the convenience fee. Taxpayers using credit cards with bonus rewards programs can, depending on their card’s program, earn rewards, points, and cash-back on airline frequent flyer miles for paying their taxes.

About Official Payments Corporation

Official Payments Corporation (Nasdaq: OPAY) is the leading provider of electronic payment options to government entities. The company’s principal business is enabling consumers to pay their government taxes, fees, fines, and utility bills by credit card, via Internet and telephone. The company is unequaled in market penetration and national footprint. Official Payments has agreements to collect and process credit card payments with the Internal Revenue Service, 18 state governments, the District of Columbia, and over 900 county and municipal governments in 49 states across the United States. In 2000, Official Payments collected and processed over $925 million in federal, state and local government payments.

Official Payments was founded in the San Francisco Bay area in 1996. Thomas R. Evans, the former President & CEO of the Internet company GeoCities, became Chairman & CEO of Official Payments in the summer of 1999. Mr. Evans brought Official Payments public in November of 1999, raising $80 million in its IPO on the NASDAQ national market. The company’s success in new client acquisition, increasing business with its existing clients and in building consumer awareness can be attributed to the combination of an enormous market opportunity with a highly skilled and experienced management and staff, aggressive sales and marketing, and a core competency in developing and implementing leading-edge technical systems.

About Official Payments Corporation

Official Payments Corporation (Nasdaq: OPAY) is the leading provider of electronic payment options to government entities. The company’s principal business is enabling consumers to pay their government taxes, fees, fines, and utility bills by credit card, via Internet and telephone. The company is unequaled in market penetration and national footprint. Official Payments has agreements to collect and process credit card payments with the Internal Revenue Service, 18 state governments, the District of Columbia, and over 900 county and municipal governments in 49 states across the United States. In 2000, Official Payments collected and processed over $925 million in federal, state and local government payments.

Official Payments was founded in the San Francisco Bay area in 1996. Thomas R. Evans, the former President & CEO of the Internet company GeoCities, became Chairman & CEO of Official Payments in the summer of 1999. Mr. Evans brought

Official Payments public in November of 1999, raising $80 million in its IPO on the NASDAQ national market. The company’s success in new client acquisition, increasing business with its existing clients and in building consumer awareness can be attributed to the combination of an enormous market opportunity with a highly skilled and experienced management and staff, aggressive sales and marketing, and a core competency in developing and implementing leading-edge technical systems.

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BMS CNP

CyberSource Corporation, a leading provider of risk management
and electronic payment solutions for enterprise businesses, announced it
has established a secure payment processing gateway with Barclaycard Merchant
Services, one of Europe’s largest acquirers and processors of card
transactions. CyberSource worked directly with Barclaycard Merchant Services
to establish a new gateway providing payment processing capabilities
specifically for “credit-card-not-present” (CNP) sales channels, such as
online stores and call centers.

This gateway extends payment solution options for merchants by allowing
them to quickly and securely accept card payments and process transactions
through BMS without having to develop, integrate and maintain their own costly
payment infrastructures or bank connections.

In addition to extending payment processing options for UK-based customers
of BMS, this gateway will allow other global businesses to accept electronic
payments and access CyberSource services to process those transactions through
BMS in Europe.

“This relationship with CyberSource will provide our customers with a
simplified solution to establish a reliable and scalable connection for
securely processing CNP transactions,” commented Tony Slater, Commercial
Director at Barclaycard Merchant Services. “This will be especially valuable
as we head into the holiday shopping season and our customers are keen to take
advantage of the anticipated growth in eCommerce.”

Neil Cook, Managing Director of the CyberSource UK office, stated, “This
direct link is an integral part of our strategy to service the needs of both
European merchants and other global businesses that wish to sell online and
via call centers worldwide using the acquiring services of Barclaycard
Merchant Services.”

He added, “The relationship with Barclaycard Merchant Services
demonstrates CyberSource’s strength in this market as a leading global
electronic payment solutions provider.”

About Barclaycard Merchant Services

Barclaycard Merchant Services is one of Europe’s largest acquirers and
processors of plastic card transactions. It is dedicated to providing a range
of e-commerce solutions to suit all types of business and was the first bank
to launch an Internet payment system, ePDQ. In 2000, 1.2 billion purchases
were made with credit and debit cards in the 131,000 outlets belonging to
Barclaycard Merchant Services’ customers in the UK. Barclaycard Merchant
Services operates the largest on-line, real time bank owned EFTPOS (Electronic
Funds Transfer at the Point of Sale) system in the UK with a PDQ terminal base
of over 123,000. For further information please contact the Barclaycard Press
Office on 01604 251229.

About CyberSource

CyberSource Corporation is a leading provider of risk management and
electronic payment solutions for enterprise businesses selling via multiple
sales channels. CyberSource solutions manage transaction risk and enable
electronic payment processing for Web, call center/IVR, and POS environments.
CyberSource professional services designs, integrates and optimizes
enterprise-wide commerce transaction systems. Over 3,000 businesses use
CyberSource solutions, including over half of the Dow Jones Industrial
companies. The company is headquartered in Mountain View, California, and has
sales and service facilities in Japan, the United Kingdom, and other locations
in the United States. For more information, please visit CyberSource’s web
site at http://www.cybersource.com/ or email info@cybersource.com.

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