Catuity Names Dawson Non-Exec Chairman; Board Reaffirms Support For Pending Merger, Capital Raising.

DETROIT & SYDNEY, Australia -- Catuity Inc., (NASDAQ:CTTY)(ASX:CAT) a provider of POS-focused solutions, today said that it had named Alexander (Sandy) Dawson as its non-executive Chairman of the Board and reconfirmed the board's commitment to the pending acquisition and capital raising.

Mr. Dawson, the retired CEO of Arnotts Ltd. and a long-time board member of Catuity, replaces Duncan Mount, who resigned today. With the unexpected death of U.S. board member Alan L. Gilman, Catuity is left with a three-person board until the company completes a search for at least one new independent director.

Mr. Mount resigned following the sale of most of his shares in the company. Mr. Mount sold 38,358 shares on the ASX on Wednesday June 22, 2005 at prices ranging from A$15.50-$17.00 during a sharply rising market following record trading that had occurred on Nasdaq.

Details of Mr. Mount's stock sales were disclosed today in regulatory filings.

"Duncan Mount has been a champion of Catuity in good times and bad as our largest individual shareholder since 1999. We are grateful for his long-term support," said Mr. Dawson. "Duncan's decision to sell shares was a commercial one based on personal considerations."

Mr. Mount continues to fully support the turnaround strategy of the Company. "I realize that it is possible that some investors may interpret my decision to sell shares as a lack of confidence in Catuity. That is not the case," he said. "Even though I have left the Board, my decision in no way reflects on the potential of the Company's strategy. My decision to resign from the Board was motivated solely by a desire to ensure that the sale of my shares would not serve as a distraction from the Company's primary focus of executing its turnaround strategy."

As previously announced, Catuity continues to prepare for an Australian capital raising, which in part will allow the Company to complete the acquisition of Loyalty Magic Pty Ltd. The Company is being represented in the raising by Melbourne-based Hindal Ventures Pty Ltd. Further details regarding the capital raising will be released shortly.

Mr John Racine, President and CEO of Catuity and the other directors of the Company are working closely to complete the capital raising and the acquisition.

About Catuity Inc.

Catuity Inc. delivers profits at the point of sale for its retail clients and their partners, including payments processors. The Company provides loyalty processing services through a hosted solution that enables membership based loyalty programs and gift card programs to chain retailers in the U.S. and Canada. More information is available at the Company's website at www.catuity.com.

In conjunction with the provisions of the "Safe Harbor" section to 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 US Securities & Exchange Commission.