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Competition / Competitors We believe that we are the first company to introduce an Internet-based online system designed to facilitate the collection of consumer debt. However, we are aware of two other companies that have recently announced offerings that may touch on some aspects of our market. Incurrent Solutions, Inc., a division of Online Resources Corp., is a supplier of customer relationship management systems and front-end web applications for banks. It announced a collection offering in fall 2004. We believe the Online Resources product is tightly integrated into the creditors' computer system and rules for treatment of accounts must be entered by Incurrent, not the client. Also, in fall 2004, Apollo Enterprises Solutions, LLC, a provider of enterprise-class web-hosted solutions for a variety of industries involved in receivables management and debt collection, announced an online collection offering. Its offering ties directly into the credit rating bureaus and incorporates real-time credit scoring. Based on our research, we are aware of only one client using the Apollo system to settle and collect consumer debt. Because the entire area of Internet-based online systems designed to facilitate the collection of consumer debt is a new offering in the collections industry, we are not aware of any market data that is presently available with respect to market share or other similar industry metrics. Presently, other technology-based offerings introduced by other participants in our general market have related to credit and collections scoring, which differs from our system and strategic direction. Several companies offer collections management and payment software systems designed to support direct-mail and telephone collection efforts. These companies may add Internet-based payment and automated settlement mechanisms to their systems. Creditor institutions themselves may also consider developing systems similar to those offered by us internally, although such systems may be limited by the breadth of the patent upon which our DebtResolve system is based. Even if creditor institutions ultimately do not decide to develop systems similar to those offered by us internally, many large creditor insitutions have the financial and technical resources to do so which may cause them to delay or decline to use the DebtResolve system for an extended period while they evaluate the merits of internal development. In addition, a number of creditor institutions have already developed Internet-based payment sites and could decide that such sites are sufficient for their collection purposes. To date, however, creditor financial institutions' new development efforts appear to have been focused on their non-delinquent customers, where they have the largest revenue opportunity, and we are not aware of any creditor financial institutions working to develop a system that is directly competetive with our DebtResolve system. However, this may change as the effectiveness of the DebtResolve system is established. We intend to continuously enhance and extend our offerings and develop significant expertise in customer behavior with respect to online debt payment to remain ahead of these potential competitors. In addition, we believe we have the following key competitive advantages: † to our knowledge, we are the first to market an integrated set of Internet-based consumer debt collection tools, † as the first to market, we have developed early expertise which we expect will allow us to keep our technology on the leading edge and develop related offerings and services to meet our clients' needs, † the patent license to the Internet bidding process protects the DebtResolve system's key methodology and limits what future competitors may develop, † the effectiveness of the Internet bidding model to settle claims has already been shown in the insurance industry by Cybersettle, Inc. (with respect to insurance claims), and † the industry reputation of our management team and the extensive consumer debt research we have conducted provide us with credibility with potential clients.