Free Response to Motion - District Court of Arizona - Arizona

EXHIBIT B

Case 2:04-cv-00400-PGR

Document 190-3

Filed 04/27/2007

Page 1 of 3

a state - of-the-are payment solution The Challenge
The customer grabs a box of birdseed, rummages in the bin for two rawhide dog bones, picks up a bag of cat litter and heads for one of five Petco checkout lanes. After the clerk scans all four items, a message appears on the Hypercom® ICE- 6000 screen prompting the customer to select a payment type. She chooses 'credit,' swipes her card through the magnetic stripe reader, verifies the correct dollar amount and signs her name on the terminal screen. Meanwhile, the clerk monitors each stage of the transaction on the Epson register powered by 1DA POS software. Once the transaction is finalized the thermal printer delivers a sales receipt including the Petco logo, a message promoting the upcoming pet adoption day, and the customer's digitized signature.All in next to no time. Back before the 1980s, the total shopping experience required clerks to enter purchase amounts item by item, ICE 5000 terminal subtotal, add state and local sales taxes, total and print a receipt. All 'automated' by electronic cash registers (ECRs) which recorded customer purchases and notified Purchasing of changes in inventory levels. Payment was handled separately, often as a manual function, and copies of paper receipts were duly sorted and filed. That was then, as the saying goes, and this is now.Today most major retailers have integrated ECR functions with card payment technologies. The shopping experience for both customers and clerks is considerably faster and more automated. But the management of system upgrades and ongoing maintenance is still often difficult. Software is purchased over here, hardware is bought over there, installation comes from yet another provider. When systems don't work as promised, finger-pointing abounds. The Solution Enter Hypercom Corporation, a leading global provider of electronic payment solutions that add value at the paint-of-safe for consumers, and for merchants and acquirers engaged in e-commerce, m-commerce, smart cards and traditional retail applications. Hypercom delivers one-stop payment systems responsibility.
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Now enter Petco Animal Supplies, inc., a leading retailer of premium pet food, supplies and services. Late in 1999, Petco came to Hypercom looking for a single -source, long-term solution enabling them to perform financial transactions. Ultimately, the solution would also provide smart card and advertising capabilities. Hypercom's one-stop, single-source payment system was exactly what Petco wanted. In fact, this competency helped win the contract for Hypercom over another bidder.Today Hypercom provides project management expertise and functions as the primary contractor for implementing the Petco system. Its

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Case 2:04-cv-00400-PGR

Document 190-3

Filed 04/27/2007

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engineers defined the scope of the project, developed detailed implementation plans, managed the development of custom software, assisted with building software interfaces to the register, tested system software in a Hypercom laboratory and delivered the total solution to the customer in agreed-upon timeframes. As a manufacturer of Internet-enabled, point-of-sale devices, Hypercom also provided ICE`" 6000 terminals and software to make the system work.This solution interfaces with POS registers and peripherals, ensures proper control over routing transactions to Petco's network, switching transactions to processors and man aging electronic receipt capture (ERC), storage and retrieval. It even provides Petco with a virtual terminal at headquarters to handle adjustments to financial transactions. Petco chose Hypercom and ICE 6000 multi-lane terminals because of these specific benefits: Turnkey solution - Hypercom delivers terminals, ECR integration, store controllers, receipt capture and retrieval, and switching software Project management - Hypercom ensures projects are being managed to meet the defined project scope and deadlines within expected timeframes Security - ICE 6000 terminals handle ATM debit encryption by allowing customers to enter their PIN numbers and complete transactions in-lane u ERC - Receipts from credit card transactions are captured at the store level and stored on a central server.They are immediately available online in the event of a chargeback j Advertising messaging - ICE terminals display advertising and promotion messages on the screen as well as on printed sales receipts The Result Petco improved their debit-to-credit conversion costs, achieved speedier checkout times and saved money through chain-wide reconciliation process improvements. In addition, Petco replaced its entire electronic payment system through one vendor and eliminated finger pointing. It also avoided hiring in-house project managers with skill sets needed to manage such a complex payment project. Through Hypercom, Petco also provides its 530 stores with help desk support, ongoing custom software changes and new release documentation. For Hypercom solutions to your card payment and networking issues, contact info0hypercom,com or your regional Hypercom office.
ICE 6000 terminal

WORLD HEADQUARTERS/ NORTH AMERICA Hypercom Corporation 2851 W. Kathleen Road Phoenix, Arizona 85053 USA TEL: +1.602. 504.5000 FAX: +1.602.504.4578

LATIN AMERICA Hypercom Latin America Rua loaquim Florian 72 16':andar C] 1131 04534.000 ItaimBibi Sao Paulo, Brazil TEL: +55. 11.3365 .2600 FAX: +55.11.3365.2610

ASIAIPACIFIc RIM Hypercom Asia Ltd. 21/F 21 Lam Hing Street Kowloon Bay Hong Kong TEL: +852.2561.6800 FAX: + 852.2561.5890

EUROPE, MIDDLE EAST, AFRICA

Metro Centre II

Hypercom Europe Ltd. Unit 2, Woking Eight Forsyth Road Woking, GU21 5SB United Kingdom TEL: +44. 1.483.718600 FAX: +44.1.483.718601

HYPERCOM
www,hypercom.com 1.877.840.9820

112001 Hypermm Corporation,all rights reserved, m the Hypercom Togo" ICE-PAC are registered trademarks of Hypercom Corporation. Hypercom FastPOS, epos- infocommerce, ICE. and The Global Leader in Eiecmunc Transaction Solutions am trademarks of Hypercom CorpordOon.Al1 other products or services mentioned in this document are tmclemarks,servke marks,registered trademarks or moteW service marks of thelr respective ovmers. Hypercom Corporation (NYSE: HYC) is a leading global provider of electronic payment solutions that add value at the point-of-sale for consumers, merchants and acquirers. Hypercom products Include secure card payment terminals and web appliances, networking equipment and software applications for e-commerce, m-commerce, smart cards and traditional payment applications. 2097-1A Headquartered m Phoenix, Arizona, Hypercom maintains an. installed base of more than 4 million card payment terminals which operate in over 100 counWes and conduct more than 2.85 bllllon transactions annually. 04101

Case 2:04-cv-00400-PGR

Document 190-3

Filed 04/27/2007

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