NEWS

Economy Slowed in Fourth Quarter 2003

The U.S. economy grew at an annual rate of 4% in the fourth quarter of 2003, according to advance estimates of real gross domestic product (GDP) from the U.S. Department of Commerce's Bureau of Economic Analysis (BEA). In the third quarter of 2003, GDP increased 8.2%.

Major contributors to the Q4 increase include personal consumption expenditures (PCE), exports, equipment and software, inventory investment and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased. The BEA will release Q4 "preliminary" estimates, based on more comprehensive data, on Feb. 27, 2004.

ACH Volume Grows 14% in Q4 2003

The Automated Clearing House (ACH) network grew by more than 14% in the fourth quarter of 2003 compared to a year ago, according to NACHA - The Electronic Payments Association statistics. NACHA said more than 2 billion transactions were conducted during the fourth quarter, valued at more than $5.2 trillion.

These figures represent growth rates of 14.1% and 5.3% respectively, over the same quarter of 2002. There were 943 million debit transactions and 1.069 billion credit transactions in the fourth quarter, for a total of 2.013 billion. The statistics include commercial inter-bank and government transactions, but not "on-us" transactions.

ANNOUNCEMENTS

ATMIA Offers ATM Security Manual

ATMIA's Global ATM Security Alliance (GASA) has published a Best Practices Manual for Physical ATM Security. The document contains international minimum physical security requirements for both stand-alone and wall-mounted ATMs.

Key contributors to the manual include the ATM Security Working Group in the United Kingdom, Banksys in Belgium, BenAlpin Ltd and LINK Interchange Network in the United Kingdom and ATMIA.

The GASA includes representation from Visa and MasterCard and from major ATM networks in several countries and law enforcement and fraud prevention agencies. For more information, visit the GASA Web site at www.globalasa.com .

InterCept Hosts Check 21 Seminars

InterCept, Inc. is offering a series of Check 21 seminars throughout the United States to help prepare and educate financial institutions about Check 21. The seminars will be held in Atlanta, Orlando, Dallas, Los Angeles, Philadelphia, Boston and Chicago in February and March 2004.

Laura N. Pringle, an expert on Check 21 compliance and a partner in the Oklahoma City law firm of Pringle and Pringle, and Clearing House network Endpoint Exchange's Mark Craig will present on Check 21.

InterCept also recently launched a Check 21 Web site (www.intercept.net/check21) that includes articles, white papers and information about Check 21 and image exchange.

Landmark Merchant Announces New Sales Program

Landmark Merchant Solutions announced a new Sales Center program, offering daily warm leads, acceptance of faxed applications with no pictures required, same day approvals, a liberal credit policy with a 97% approval rate and MOTO/Internet merchants.

The program allows ISOs/MLSs to offer each new merchant a free custom-built 15 page Web site, a free domain name, free hosting and free e-mail accounts.

For more information, visit the company's Web site www.LandmarkMerchant.com; call CEO Alan Gitles at 1-800-882-4896 x410 or send an e-mail to ISO@LandmarkMerchant.com.

Paymentech Opens Europe HQ

Dallas-based Paymentech, L.P. opened its first-ever European office in Dublin, Ireland in response to merchant requests that the company establish a presence in Europe.

The new office will support operations and the needs of its global merchants such as America Online, Symantec, Lands End and Amazon.com; John Shirey, Paymentech Managing Director, will head up the new location.

In other news, Paymentech won a multi-year processing agreement for The Container Store's 30 locations, which will transition from dial-up processing to frame relay and will add a PIN-based debit option at the point of sale.

Shift4 Reports 400% Growth in 2003

Shift4 Corp. said its Web-based e-payment solution, $$$ ON THE NET, processed nearly $6 billion in payments, representing nearly 32 million transactions, in 2003.

The company attributes its growth to a number of factors, including new customer signings (such as N9NE Group, Purdue University and Kohler's American Club); they selected $$$ ON THE NET to process credit, debit, gift card and check transactions; and the emergence of Shift4's Channel Partner Program, including POS/PMS providers, consultants, solution developers and MSP/ISOs who act as resellers or referrers for Shift4.

Triton Makes 100,000 ATMs

ATM provider Triton said it recently manufactured its 100,000th ATM (a RL5000 ATM). The company began making ATMs in 1994.

VeriFone Omni 3750 Class-A Certified

VeriFone, Inc.'s Omni 3750 payment terminal with IP/Ethernet capability has earned Class-A certification from Paymentech, L.P. Paymentech will use the Omni 3750 to enable its NetConnect processing solution, which serves the retail, petroleum and restaurant industries. The Omni 3750 has a 32-bit processor, built-in Ethernet connectivity and SSL encryption; it has been certified by all of the leading U.S. processors; and it supports solutions from over 20 value-added application providers. PARTNERSHIPS

Burger King Expanding Card Acceptance

Burger King Corp. selected Chase Merchant Services, L.L.C.-a joint venture between JPMorgan Chase Bank and First Data Corp.-as the processor for a card acceptance program intended to expand the number of its restaurants accepting credit card and signature-based debit card payments nationwide.

Currently, card payments are accepted in more than 2,100 Burger King restaurants, and the company hopes to increase this number at its U.S. franchises.

The Burger King system operates more than 11,285 restaurants in all 50 states and in 58 countries and territories around the world. About 91% of Burger King restaurants are owned and operated by independent franchisees, many of them family-owned operations that have been in business for decades.

Certegy to Use SLIM CD

Certegy, Inc. selected SLIM CD Inc.'s software to process transactions in an incoming call-center environment. Certegy recently launched a new program with one of its large partners to provide stored value cards to millions of potential cardholders.

The initial card registration process requires the collection of a fee, which will be processed using SLIM CD's product.

In a separate agreement, Home Depot will use Certegy's check collection and recovery services in 1,587 of its stores in 50 states, the District of Columbia and Puerto Rico. Implementation of Certegy's solution in Home Depot stores began in September 2003.

Shift4 and Ingenico Partner

Shift4 Corp. integrated Ingenico's eN-Touch 1000 touch screen and signature capture terminal and the eN-Crypt 2100 payment terminal with its $$$ ON THE NET electronic payment solution for retailers.

Retailers using $$$ ON THE NET will be able to provide customer-activated electronic payment acceptance, PIN entry for online debit and electronic signature capture with the Ingenico payment terminals.

NPC Renews with Retail Ventures

National Processing Company, LLC (NPC), a wholly owned subsidiary of National Processing, Inc. renewed a credit card processing agreement with Retail Ventures, Inc., a leading off-price retailer with stores in 29 states.

NPC will continue to provide authorization and settlement services for all Visa and MasterCard transactions accepted at Retail Ventures retail locations, including Value City Department Stores, Filene's Basement stores and DSW stores. NPC has been processing for Retail Ventures for more than 10 years.

NPC also signed a multi-year credit card processing agreement with Mimi's Cafe. NPC will provide authorization and settlement of all MasterCard, Visa, American Express, Discover and Diners Club transactions accepted at all 82 Mimi's Cafe restaurant locations in California, Arizona, Colorado, Florida, Kansas, Nevada, New Mexico, Oklahoma, Texas and Utah.

Enterprise Car Rental Signs with NSF

NSF Check Retrieval announced that Enterprise Car Rental will use NSF Check Retrieval's free check recovery service to collect on bounced and bad checks.

NSF Check Retrieval handles check collections through a process called "electronic re-presentment," which allows the company to debit each bad check and a state-defined service charge directly from the bad check writer's bank account.

Taco Bueno IP-enabled with VeriFone

Taco Bueno completed installation of VeriFone, Inc.'s Omni 3750 Internet Protocol (IP) enabled terminals in its locations nationwide. Network integrator designed and installed the IP network over which the VeriFone Omni 3750 terminals communicate to Paymentech, Taco Bueno's processor.

MERGERS & ACQUISITIONS

Global Axcess Buying Merchant Portfolio

Global Axcess Corp. said it expects to acquire approximately 900 ATM/merchant contracts from a privately held Southeastern-based company for $3.9 million in cash.

Two Check Companies Merge

Check guarantee company Insta-Check and BankServ Check Services, LLC have merged; the name of the combined companies is EnCircle, and it is located in Miami. EnCircle will offer an integrated suite of check products and services, including electronic check conversion, verification, guarantee, collections, RCK, consolidated returns, check imaging and administrative returns handling.

The company said any of these offerings can be combined or tailored depending on client requirements. EnCircle also offers ARC and TEL to VISA POS Check customers. The combined companies have more than 25 years of experience in the business; EnCircle's management team has more than 100 years of combined experience.

NetBank Acquires Electronic Cash Systems

NetBank, Inc., parent company of the country's first commercially successful Internet bank, NetBank, announced that its wholly owned subsidiary, NetBank Payment Systems Inc. (formerly Financial Technologies, Inc.), completed its acquisition of select assets of Electronic Cash Systems Inc. (ECS).

NetBank acquired ECS in order to expand its focus on merchant processing; the deal adds more than 1,000 ATMs to its portfolio and additional POS and merchant processing customers.

With the addition of the ECS assets, NetBank Payment Systems will have more than 5,000 ATMs deployed across the country processing more than 1.5 million or $72 million worth of transactions per month.

APPOINTMENTS

Fleet One Promotes Marketing Director

Fleet One, L.L.C promoted Stacey Bright to Vice President of Marketing. Bright previously served as Director of Marketing for Fleet One and was responsible for planning and implementing the company's national re-branding campaign.

Prior to joining Fleet One, Bright served as Senior Marketing Manager at Nashville-based BlueStar.net, a provider of broadband communications and Internet service applications.

Ciccarone Comes to Wachovia

John Ciccarone has joined Wachovia Corp.'s International Division's Global Payments Services Group as Vice President and Market Consultant for the Global Financial Institutions Americas and U.S. Dollar Payment Products groups.

Ciccarone comes to Wachovia from ABN Amro where he was a Vice President in the Product and Services Group. Prior to that, he worked in various positions in the International Division at Bankers Trust. Ciccarone earned his MBA in finance from Temple University.

Howard Herndon Joins First American

First American Payment Systems, L.P. named Howard W. Herndon to serve as Executive Vice President and General Counsel. Herndon was most recently a member of Nashville, Tenn.-based Waller Lansden Dortch & Davis, PLLC.

He was the Chairman of Waller Lansden's Venture Capital Practice Group, Co-Chairman of the Opinions Committee and he served on the firm's Operations Committee. He was the firm's representative and voting member of the Electronic Transactions Association (ETA).

First Data Names New Card Issuing Services President

James L. Schoedinger, a 24-year veteran of the financial services industry, was appointed President of First Data Corp.'s Card Issuing Services business unit.

In this role, Schoedinger will oversee the Card Issuing Services business unit in Omaha, reporting directly to Charlie Fote, First Data Chairman and CEO. Schoedinger also will serve as a member of First Data's Executive Committee.

He most recently served as President of Transamerica Real Estate Information Services, one of Transamerica Corp.'s largest business units.

Before joining Transamerica, Schoedinger spent 16 years at GE Capital, where he held full profit and loss responsibility for three GE Capital businesses: Private Label Credit Cards, Personal Lending and the start-up of GE's Visa/MasterCard business.

BOTTOM LINES

• Ahold's U.S. subsidiary, Tops Markets LLC, plans to sell its chain of 204 convenience stores. The stores include Wilson Farms Neighborhood Food Stores (127), Sugarcreek Stores (67) and Tops Xpress (10), the National Association of Convenience Stores reported.
• One Price Clothing Stores Inc., a women and children's clothing store retailer with 494 stores, filed for bankruptcy protection under Chapter 11.
• Teen apparel retailer Gadzooks Inc. filed for bankruptcy protection and is closing 156 stores and cutting jobs to reorganize as a smaller retail clothing chain.
• Big Dog Holdings, Inc. will acquire The Walking Company for cash, debt and equity securities in excess of $15 million. The Walking Company declared bankruptcy in the summer 2003.