Since the beginning of the project, Axalto provided the US DoD with more than 5.7 million certified microprocessor cards

Amsterdam, September 2, 2004 -Axalto (Euronext: NL0000400653 AXL) today announced that it received an order for 800,000 additional Department of Defense (DoD) Common Access Cards (CAC) from EDS, a General Services Administration (GSA) smart card prime contractor for the program. With more than 5.7 million certified smart cards provided to the DoD, Axalto not only confirms its key role in supporting one of the largest ID smart card deployments in the world, but is also a strong indicator of the continued growth of Axalto in the high-end value-added smart card market.

The CAC enables physical identification for building access and logical access for secure logon, secure emails and privilege-based access to secure networks and databases. As of today, the CAC program is rolled out in over 900 DoD locations worldwide, serving as the standard ID card for government staff (active duty military, selected reservists and National Guard, DoD civilian employees and selected DoD contractors).

“The Department of Defense has taken a leadership role in leveraging the benefits of smart cards,” comments Olivier Piou, Chief Executive Officer of Axalto. “We appreciate this additional order for 800,000 Axalto microprocessor cards as further testimony to their commitment to high quality standards, as well as to the strong level of trust they place in our company.”

The U.S. federal government expects to expand its programs to issue microprocessor cards for strong authentication and as convenient secure identity credentials, and is moving closer toward the goal of a common identity credential for both physical and logical access control across all of its branches. Programs are already underway or planned to issue new smart ID cards in numerous federal agencies, including Defense, State, GSA, Treasury, Homeland Security, Veterans Affairs and NASA.

About Axalto
Axalto (Euronext: NL0000400653 AXL) is the world’s leading provider of microprocessor cards (Gartner Dataquest 2004) - the key to digital networks - and a major supplier of point-of-sale terminals. Its 4500 employees come from 70 nationalities and serve customers in more than 100 countries, with worldwide sales reaching 3 billion smart cards to date. The company has 25 years’ experience in smart card innovation and leads its industry in security technology and open systems.

Axalto continuously creates new generations of products for use in a variety of applications in the telecommunications, finance, retail, transport, entertainment, healthcare, personal identification, information technology and public sector markets. Microprocessor cards provide convenience, security and privacy to public and private services operators, their customers and end users.

For more info, please visit www.axalto.com.