ake one pure technology company focused on wireless and the Internet. Merge it with an established entity that manufactures 20% of the world's credit cards. The result: a leading provider of wireless and Internet transaction-enabling solutions and smart card issuance technologies.

MIST is an amalgamation of industry leader NBS Technologies, a publicly held corporation that has been intrinsically involved in the credit card business since 1974, and C&D Data Technologies. NBS acquired C&D in 1999.

"At that time NBS produced standard dialup terminals for transactions," says Charles Lee, President of MIST. "We had 10-year-old terminals and we started thinking. In the technology industry, many changes had gone into communication, such as wireless, so we looked at that market. We went through a radical change focusing on emerging technology. Our mandate was to grow our business. We got funding and developed Freedom II and then Freedom III."

For those who've been living on a deserted island for the last two years, the Freedom series is a terminal product line that MIST has developed and deployed with wireless, dialup and Internet capabilities. The Freedom III, an Internet-enabled terminal, boasts unique features and is the only terminal that utilizes 128-bit SSL security.

Lee says MIST is superior in other areas as well. "We understand wireless and Internet technology from end to end," he says. "Our competitors say, 'Here's a terminal - integrate it into your system.' If that bank or processor doesn't have the connectivity, they have to build a network and change their back end.

"We provide a gateway that enables seamless integration ... and we provide it faster than anyone. We are absolutely a step or two ahead of our competition. We were the first in 2000 with a wireless terminal. We were the only booth at the ETA in Hawaii with wireless. This past year, we were the only company that showcased secure Internet transactions on a terminal in Seattle. We stand out because we are end to end."

MIST boasts that its core competency is more than just wireless. It is advanced-transaction technology using the latest data capabilities. That technology is evidenced in MIST's Freedom terminals as well as its value-added proprietary transaction gateway, FreedomGate.

For example, the Freedom III is an Internet-enabled, countertop, point-of-sale wireless device with SSL security. It features a backlit LCD touch-screen, a backlit keypad, a Web browser and an integrated thermal printer.

The Freedom III offers the convenience and flexibility of communicating using different modes: Ethernet, wireless and dialup. Freedom III enables users to complete debit, credit and smart card transactions using FreedomGate. FreedomGate that connects wireless data networks, the Internet and public switched telephone networks to each other as well as to financial-transaction processors and banks. FreedomGate enhances MIST Freedom transaction terminals by enabling their usage with the latest communication methodologies and by providing secure gateway services with value-added options such as messaging, time-and-attendance recording and order fulfillment in addition to financial transactions.

FreedomGate also enables interdevice communications, data collection and financial transactions on other third-party wireless terminals, wireless devices such as cellular telephones and pagers, and other Internet-enabled devices.

Before the introduction of Freedom III, MIST brought the Freedom II terminal to the marketplace. Designed for mobile merchants, it features an integrated secure processor to complete debit card transactions and a built-in printer for receipt printing. The Freedom II terminal makes the customer the point-of-sale.

Powered by an easily replaceable and rechargeable battery pack, the Freedom II operates for hundreds of transactions between charges. The built-in battery charger connected to a small AC power adapter eliminates the need for a bulky charging stand. Its backlit, graphical display is readable both in daylight and at night. The luminescent "glow-in-the-dark" keypad ensures that it can be used even in low-light conditions.

A third product in the Freedom Family is the FreedomLITE, a terminal MIST developed for the low-end merchant market.

"All of our competitors are moving up into the higher-end market," says Lee. "We led the marketplace in that area, being the first to come out with IP and wireless. We noticed that the bottom end of the market was being abandoned. We came up with an all-in-one product - high-speed dial capability, integrated debit, high-speed clamshell printer, smart card reader and secure access module - every card technology built into one, at a low cost." Cost is key at MIST. Its FreedomLITE terminals are priced at less than $300. Its Freedom II is less than $800, and its Freedom III is $500, with moderate volume variable.

With such a variety of terminals comes a variety of target markets for MIST. The FreedomLITE is best suited for the mom-and-pop merchants who want an all-in-one device at a lower cost, Freedom II is for the mobile merchant, and Freedom III is for those large merchants who need fast transactions in an Internet environment.

More than 600,000 merchants are making MIST their terminal of choice. They include financial institutions, credit and debit card processing companies, card-issuing service bureaus, retailers, hotels, health care institutions, loyalty service providers and ISOs.

ISOs are an important sales channel for MIST, especially because MIST is relatively new to the U.S. market with its Freedom terminals even though its card manufacturing business has been around for more than 20 years. Already, nearly 50 ISOs across the country are embracing the MIST program.

The reasons are numerous. In addition to the obvious value add of wireless capability, MIST provides two levels of ISO training, conducted online and via teleconferencing. ISOs also enjoy a 24/7 help desk and quick turnaround for their merchant accounts.

MIST offers same-day shipment for terminals with gateway connectivity within minutes once the device is received. Best of all, MIST does not have an in-house sales force. It works exclusively with ISOs and processors, never selling directly to end-users.

"We work with ISOs large and small," says Lee. "We want ISOs who understand the proposition of our Freedom terminals. It's easy to like our Freedom Lite. Merchants love it, and every ISO understands that. For the Freedom III, they really need to understand the cost proposition of replacing a phone line and then getting three- to five-second transactions. Some ISOs just want to sell a terminal and not worry about technology. We want ISOs to take the time not just to make the sale but to explain it."

Also paramount to MIST are its partnerships. For instance, its Freedom III recently received certification from Paymentech. The certification will fully support and help continue Paymentech's goal of offering a variety of leading POS options to its vast merchant and client base. This is a big feather in MIST's cap considering that in 2001 Paymentech processed more than $114 billion of bankcard sales.

"At Paymentech, we provide the latest in cost-saving payment technologies for our merchants," says Brian Beacom, Director of Strategic Product Development for Paymentech. "Certifying the MIST Freedom III POS terminal is another way we can enhance both the quality and selection of products we offer to our clients."

MIST is committed to forming strategic alliances with other companies that understand its technology since that is its edge. It is the cornerstone of the company, and MIST takes it seriously.

"We don't limit ourselves to who we will work with," says Lee. "We are the new kids on the block, so we are always looking for innovative thought that can bring market presence. We have something different and want to work with partners who appreciate that."

It would appear that MIST is successfully meeting the challenges of technology, alliances and keeping ahead of the curve. What poses the biggest threat?

"It's a good thing and a bad thing," says Lee. "It's keeping up with the pace of growth. We have many customers interested in product and wanting to certify with them. Obviously, a company that grows at 100% rate has stress. It's more internal stress, such as hiring the right people."

Growth is the word at MIST. For the nine months that ended June 30, 2002, revenue was reported at $43.8 million, an increase of $4 million compared to the same period in 2001. Revenue from the sale of MIST's Freedom II and III transaction terminals more than doubled over the comparable period last year, to $15.6 million from $6.6 million, as these products continued to gain acceptance in the market.

"While we have a high growth strategy, other challenges include building our customer base," says Lee. "We also recognize that our competitors are becoming formidable and are not sitting back. The next challenge is technology and continuing to be innovative."

That innovation can be seen in MIST's latest offering - the Freedom VT. It's a virtual terminal that puts transactional-terminal functionality into a Web browser. The application resides on MIST's FreedomGate.

"If you look at all appliances coming out, everything has a browser," says Lee. "Cell phones and PDAs have browsers. Kiosks have browsers. All of these apps could easily become POS terminals with Freedom VT because they can access our FreedomGate.

"By accessing a common platform, we can enable any Internet-enabled hardware to become a POS terminal. If you can't beat 'em, you got to join 'em. That's where our technology is going.

"Our goal is to build all apps using pure browser-based systems. That is the direction the industry is going, and we are planning for that direction."