Catuity Files First Quarter 10-Q; Three Agreements Signed.

Business & Technology Editors

DETROIT--(BUSINESS WIRE)--May 22, 2001

Catuity, Inc. (NASDAQ:CTTY, ASX:CAT) today announced its operating results for the first quarter of 2001.

In the first three months of 2001, the Company's U.S. operations were fully established and actively supporting its international activities. The Company signed three agreements with customers that are expected to further its progress in penetrating its market. License agreements were signed with FleetBoston Financial Corporation ("Fleet") to provide the Company's loyalty software application on Fleet's "Fusion" smartVisa card initiative, and with Global Consumer Technologies, Inc. ("GCT") to utilize the Company's loyalty software on GCT's payment cards and loyalty cards. The Company also signed an agreement in principle for joint product development and marketing with Lynx Systems, Inc. ("Lynx"), a company that provides transaction processing services to merchants. The Company expects this agreement to result in the development of a magnetic stripe version of the Company's loyalty software application that will provide Lynx with value added services for its customers. Under the agreement, loyalty related revenues will be shared between Lynx and Catuity and Catuity may license the software to merchants that do not receive their transaction processing service from Lynx.

First quarter revenues were $145,225 for 2001 compared to $32,028 for 2000. The Company reported a loss from continuing operations of $500,799 or $.06 per share for the period ending March 31, 2001, compared to a loss of $2,195,407, or $.33 per share for the period ending March 31, 2000, a decrease of $1,694,628.

Michael J. Howe, President and Chief Executive Officer, stated, "Catuity has developed a real time capability for the collection of customer data that will be used for the accumulation and redemption of incentive rewards at the point of sale. We are working with customers who are committed to making this happen. There are card issuers, processors, terminal manufacturers, banks and merchants working to integrate loyalty and incentives to payment systems. This is a big undertaking and an even bigger opportunity. We see a loyalty/payment system that will benefit customers, merchants, and banks being operated by traditional payment system providers."

About Catuity, Inc.

Catuity, Inc. (www.catuity.com) is a leading provider of loyalty software systems. The Catuity software includes an integrated suite of applications that provide loyalty, ticketing, access control, and membership. The Catuity Loyalty System is ubiquitous in that it can operate on any device, any card program, and with any payment process, including stored value, smart cards and wireless applications. Catuity unites the brick-and-mortar retailer with the Internet to enable cross-sell capabilities with consistent brand imaging across all channels.

In conjunction with the provisions of the "Safe Harbor" section of the Private Securities Litigation Reform Act of 1995, this release may contain forward-looking statements pertaining to future anticipated projected plans, performance and developments, as well as other statements relating to future operations. All such forward-looking statements are necessarily only estimates of future results and there can be no assurance that actual results will not materially differ from expectations. Further information on potential factors that could affect Catuity, Inc. is included in the Company's Form 10-K, which is filed with the U.S. Securities & Exchange Commission.