Wave Systems Acquires Indigo Networks

Internet Shopping Platform Tied to Next Generation E-commerce Transaction and Security Infrastructure Capabilities

LEE, Mass.–(BUSINESS WIRE)–Sept. 6, 2000–Wave Systems Corp. (Nasdaq: WAVX; http://www.wave.com ), a leading developer of technology platforms and services that enable next-generation e-commerce, today announced it has completed the acquisition of all the assets of Nashville, TN-based Indigo Networks, LLC and its e-commerce shopping network, iShopHere.com (http://www.iShopHere.com ), for 374,889 shares of Wave’s Class A Common Stock.

The Internet portal iShopHere.com provides consumers access to quality brands and retailers as well as special savings. iShopHere.com generates revenue by routing traffic to merchant sites. It also receives a percentage of each purchase transaction that takes place through its large merchant network. Merchants in the iShopHere.com network include Warner Bros. Online, Dell, L.L. Bean, Nordstrom.com, OfficeMax, Toysrus.com and Bose.

By combining iShopHere.com’s access to leading merchants with Wave’s EMBASSY Trusted Client e-commerce technology, consumers will be able to complete transactions over the Internet with unprecedented security, reliability and trust.

“Indigo has a proven e-commerce shopping platform and an impressive base of more than 450 retailer relationships,” said Steven Sprague, Wave’s president and CEO. “Wave is the leader in developing trusted, secure, next-generation e-commerce transaction and metering infrastructure. Together, Wave and Indigo will offer affinity groups – such as credit card holders, associations, employee groups, unions, etc. – the opportunity to have trusted, secure e-commerce and unique offers specifically tied to group membership.”

Crom Carmichael, COO of iShopHere.com, becomes vice president, retail operations, Wave Systems Corp.

“iShopHere.com customers will now be able to experience personal commerce portals on their desktop with access to the most advanced, secure e-commerce capabilities around,” Carmichael said. “By attacking the digital retail market through virtual affinity groups and other strategies, Wave will have the opportunity to further promote the mass adoption of its core Trusted Client technologies. In addition, this acquisition provides an extension to Wave’s EMBASSY Trusted Client e-commerce offerings from digital goods and services, such as entertainment, to include a wide array of hard goods shopping as well.”

About Wave Systems – Wave Systems’ goal is to build a worldwide network of users based on trusted electronic relationships. Trust @ the Edge defines a new architectural model for the Internet, which embeds trust and security in every user device. Wave Systems is developing, deploying and licensing its EMBASSY Trusted Client technology for the mass adoption of this revolutionary model, integrating industry standard functions from a wide range of partners that enable reliable, secure digital exchange and commerce over the Internet. At its core, Wave Systems is building the services, and enabling 3rd parties to build services that will take advantage of this new, open, Trust @ the Edge model.

About Trust @ the Edge – All current solutions involving, privacy, security and commerce are based on the centralized network portal model. This model takes advantage of PCs for processing, the Internet for connectivity, and the World Wide Web for browser navigation, but lacks the one component that will enable the true explosion of digital exchange and commerce, as well as enhance privacy – embedded trust and security in Internet user devices. Trust @ the Edge is revolutionary in that it turns the Internet inside out, moving core security and e-commerce functions out to the edge and places them in the user’s Internet device. Trust @ the Edge is the integration of strong security in every user device which provides for the creation of trusted relationships and enables reliable digital exchange and commerce over the Internet.

Safe Harbor for Forward-Looking Statements Except for the statements of historical fact, the information presented herein constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include general economic and business conditions, the ability to fund operations, the loss of market share, changes in consumer buying habits and other factors over which Wave Systems Corp. has little or no control.

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