Activcard Provides The “Smarts” In One Million Common Access Cards Issued By The U.S. Department Of Defense

FREMONT, Calif. – August 28, 2002 — ActivCard® (Nasdaq: ACTI/Nasdaq Europe: ACTI), a leader in identity management and strong authentication solutions, announced that the U.S. Department of Defense (DoD) today issued the one millionth smart card-based Common Access Card (CAC) enabled by the company’s digital identity management (IDM) system and standard-setting, secure card applets.

The CAC is a military ID badge that enables building and site access around the world, photo ID, healthcare privileges, and demographic and entitlement information among other applications. The DoD uses ActivCard’s open standards-based IDM system, known by the DoD as the “issuance portal,” to initialize, personalize, and manage user credentials and applications on over one million chip-based smart-cards issued to active duty personnel around the world.

The one millionth CAC milestone is being celebrated today in a special ceremony at an issuance site at Fort Belvoir in the Washington DC area. The DoD has mandated that all 4.3 million DoD active personnel worldwide will be issued the new consolidated CAC ID badge by the end of 2003.

“We are incredibly proud of accomplishing this milestone with the Defense Manpower Data Center (DMDC) team to create and manage the world’s largest deployment of multi-application smart card-based ID badges,” said Steven Humphreys, CEO of ActivCard. “It is gratifying to be recognized for providing the digital identity management system which has enabled a deployment of this magnitude and has tightened security for military personnel around the world.”

“DMDC has partnered with the world’s best IT companies to produce the CAC, recognized as one of the best products in the world through its nine major technology awards in the last year,” said Kenneth C. Scheflen, Director, DMDC. “Our team has worked very hard to use commercially available products and to push the smart card industry toward standards-based products and full interoperability. What DoD has accomplished is now available to other governmental and private organizations who want to leverage the technology with minimal start up time and costs.”

The ActivCard CAC solution drives down the DoD’s total cost of operation by addressing system deployability, scalability, manageability, and supportability at every stage of the CAC card’s lifecycle.

At the time of a CAC card’s issuance, ActivCard’s IDM system consolidates multiple credentials and applications on a single card into the ActivCard applets – special applications designed for smart cards stored in the cards – which are PIN, PKI and Generic Container (GC). CAC users are then enabled to digitally sign and encrypt/decrypt email, approve electronic purchases, provide user authentication for network access and their demographic data and PKI certificates are stored in the GC. After issuance, ActivCard’s IDM system can add or update applications or information on the CAC card securely, in military locations around the world.

About ActivCard CAC Solutions
ActivCard IDM software is the foundation for the entire CAC infrastructure. Beginning in 1999 with the DMDC, the Company:

Developed the specifications for the CAC card infrastructure, including secure channels for issuance and post-issuance management, usage and future applications
Is fully compliant with the GSA CAC interoperability standard for user workstation software and CAC standards with the Internet Engineering Task Force (IETF), Global Platform, National Institute of Standards (NIST) and National Security Agency (NSA) policy
Developed and licensed the CAC applets to the DMDC for 4.3 million users
Deployed IDM software – in conjunction with integration partner EDS – on all RAPIDS user enrollment workstations installed in 900 locations around the world, including the Pentagon, military bases and aircraft carriers Deployed nearly one million copies to date of ActivCard Goldâ„? for CAC workstation client software with the U.S. Army, Navy and Air Force
Is the only provider whose technology is deployed throughout the CAC infrastructure – in the data center, on client workstations and inside the CAC ID Badge.

About ActivCard

ActivCard is a leader in identity management and strong authentication solutions. We give businesses and governments the confidence that people are who they say they are online. ActivCard has the unique ability to implement a complete end-to-end, open standards-based digital identity system. We are trusted by the leading names in network computing including Hewlett-Packard Company??, Sun Microsystems, Inc.??, and VeriSign, Inc.??, as well as the U.S. Department of Defense.

The statements in this press release that are not historical facts are forward-looking statements that involve risks and uncertainties, including risks associated with fluctuations in operating results, our history of losses, the concentration of our customer base, our reliance on strategic relationships, acquisitions and managing the Company’s future growth, and other risks identified in the Company’s periodic filings with the United States Securities and Exchange Commission, including but not limited to those appearing under the caption “Risk Factors” in the Company’s annual report on Form 20-F. Actual results, events and performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. ActivCard disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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