Organization Presentation.

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8M Small Businesses 14M Home Businesses. Noteworthy hindrances to ... 1 Estimated PC Postage little business deals and showcasing cost (barring ...
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Organization Presentation November 2008

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Safe Harbor This presentation contains forward-looking articulations that include dangers and vulnerabilities, including discourse of item and strategies for success and money related projections.  Important danger variables, including the organization\'s capacity to finish its items and acquire administrative endorsement, which could bring about real results to vary substantially from those in the forward-looking explanations, are point by point in filings with the Securities and Exchange Commission produced using time to time by, including its Annual Report on Form 10-K for the financial year finished December 31, 2007, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. We urge you to audit the danger variables in these filings.

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Agenda PC Postage Service Overview PC Postage Marketing PhotoStamps Financials

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Service Overview Software-based Internet benefit that gives clients a chance to purchase and print their own USPS postage Requires just you\'re existing PC, printer & Internet association Monthly administration expense (+ the expense of postage) Three approaches to print postage Print your own stamps (NetStamps) Print shipping names Print straightforwardly on envelopes

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Internet Postage Feature Print postage straightforwardly onto envelopes or onto names Internet postage is perfect for business and mass mailings Address check and adjustment Integration with MSFT Word, Office and different location databases

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NetStamps Feature Print your own stamps Use for any stamp esteem Use for any class of postage Increased adaptability Not fixing to a location No lapse date Customers purchase clear name stock Photo NetStamps permit clients to print postage on clear name stock with their altered logo Consumable income stream

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Shipping Label Feature All-in-one transportation name composed particularly for bundle use Printed on plain printer paper or on cement names Discounts on postal rates 3% markdown on Express 1 – 11% rebate on Priority (normal 3.5%) 1 6 – 8% markdown on Global Priority & Express $0.57 - $0.65 per bundle for electronic conveyance affirmation Ability to conceal postage sum E-mail following notices Avoid 1lb bundle limitations 1 Discounts on Priority & Express get to be successful May 12, 2008; 3.5% is the normal rebate on Priority per the USPS

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Microsoft Integration Enhanced coordination with Microsoft Office System 2003 & later Access from various areas inside Office Under Tools - > Envelopes and Labels (single envelope) As a component of a Mail Merge (numerous envelopes)

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Customer Benefits Save Time Mail or ship from home or office Avoid excursions to the mail station Available 24 hours x 7 days a week Save Money Discounted postal rates (Priority, Express, Global Priority & Express) Discounted bundle following (Delivery and Signature Confirmation) Save 10% on bundle protection contrasted with USPS Avoid immoderate returned mail with location confirmation Avoid squandered postage by ascertaining accurate postage sum Access to practical mail classes (media mail, package post, and so forth.)

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Customer Benefits Enhance business profitability and picture Produce more expert looking mail Easy mass mailings w/Microsoft Word Track, control and diminish postage consumptions Improve proficiency of delivery operations Hidden postage esteem permits shipping & taking care of markup Integrated Package Insurance Online bundle following capacities with email warnings

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Agenda PC Postage Service Overview PC Postage Marketing PhotoStamps Financials

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Industry Overview Large market opportunity 1 $51B U.S. Postage Market (addressable by STMP\'s answer) 8M Small Businesses + 14M Home Businesses Significant obstructions to section exist Long and complex USPS administrative endorsement process (2 ½ years for unique endorsement, multi-year for NetStamps endorsement) Stamps has an exceptionally solid patent portfolio (66 issued, 100 pending US Patents) is the classification pioneer 3 affirmed PC Postage sellers (Stamps, Pitney Bowes, ~85% of all PC Postage membership clients 2 1 Source: International Data Corporation Reports and USPS 2006 Annual Report (rejects Standard Mail & Periodicals) 2 Source: USPS PC Postage Data and Company gauges; avoids evaluated clients on a no-month to month expense arrangement.

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Current SOHO Pricing Fees are notwithstanding postage (face esteem) and different supplies Pro Plan Premier Plan $17.99 every month Unlimited administration use Auto-charged month to month $5 free beginning postage $25 free postage refund 1 Free scale refund 1 $24.99 every month All components of Pro Plus: FedEx Label Printing (and 5-10% markdown) Plus: Higher meter equalization Plus: More cost codes Plus: Certified Mail Solution 1 Certain Promotional things are redeemable after a client finishes their trial and is effectively charged

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Cost versus A Postage Meter 1 Price following 1 year limited time period is $25.75/month in addition to an additional $5/month for a 5 lb. scale (free 5 lb. scale included w/ 2 Fee charged every time postage is bought; initial two resets in meter life are incorporated for nothing and all resets are $5 from that point. 3 Based on USPS reports, absolute CY 2006 little business meter postage partitioned by CY 2006 normal meter check. 4 Assumes one reset/month, $0.80 normal per print, and meter cleaned as prescribed. Reach is for low cartridge (400) to high cartridge (800) yield at avg. $185/month utilization. Postal rate change upgrades cost additional with meter (free with Fetched codes likewise cost additional with meter (10 included with Pro Plan).

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Marketing Channels has an expanded arrangement of showcasing projects: Affiliate Program Direct Mail Online Media (standards, authorization messages, pop-ups, paid pursuit words) Referral Program site Strategic Partners (Microsoft, EarthLink, Peachtree, Avery) Telemarketing Traditional media Online Enhanced Promotion Channel 1 Enhanced Promotion Channel incorporates accomplices that publicize our administration on the Internet in which the accomplice normally offers an incremental advancement (notwithstanding any advancement offered by us) keeping in mind the end goal to get the client to attempt our administration.

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2008 PC Postage Plan Increase and improve our Small Business showcasing venture Expect to expand client securing spend in the non-upgraded advancement channels (e.g. Standard mail) by 25 - 30% in 2008 Continue to run online upgraded advancement channel Improve the client experience Improve programming ease of use to enhance introductory client experience Market our new Premier rendition Added Multi-client capacity Market Premier as an up offer to existing clients Market our corporate venture arrangement Continue scaling undertaking deals and promoting endeavors Add item elements to the endeavor variant of our administration

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Agenda PC Postage Service Overview PC Postage Marketing PhotoStamps Financials

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PhotoStamps Offering PhotoStamps permits clients to arrange legitimate US postage with tweaked photographs or pictures from a basic site Customer transfers photograph or realistic and redoes look & feel Customer places request online affirms the picture and prints the PhotoStamps sheets Customers get PhotoStamps by means of mail in a couple days Pricing is ~$5 to $10 per sheet in addition to the expense of postage 1 Actual evaluating relies on upon the quantity of sheets requested and postage esteem per sheet; cites for higher volume rebates accessible.

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PhotoStamps Industry Overview Customized postage system is controlled by the USPS Currently in the fourth market test with approval through May 2009 Only endorsed PC Postage merchants can give the postage to tweaked postage items is the classification pioneer in altered postage 3 affirmed merchants: Stamps, Endicia, Pitney Bowes (w/Zazzle, Fuji) Market opportunity exists in purchaser and business Consumer to Consumer First Class business sector is 6.1B pieces for every year 1 Business to Consumer First Class business sector is 17B pieces for each year 1 Source: USPS 2006 Household Diary study

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2008 PhotoStamps Plan Focus on enhancing benefit in PhotoStamps Reduce PhotoStamps buyer advertising spend by taking out failing to meet expectations promoting programs Expect lower income yet enhanced gainfulness Focus on developing business PhotoStamps Target high volume business use of PhotoStamps through direct offering endeavors Continue seeking after associations Target savvy organizations to drive shopper PhotoStamps mindfulness and deals Current accomplices incorporate Apple, Google/Picassa, HP/Snapfish, Adobe, Costco, American Idol

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Agenda PC Postage Service Overview PC Postage Marketing PhotoStamps Financials

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Financial Overview has a few income parts: Recurring month to month administration expenses (PC Postage) Online store offers of consumables and peripherals (PC Postage) marked bundle protection (PC Postage) PhotoStamps market test deals has an alluring budgetary model: High gross edges Leverageable settled costs Low working capital speculation Low capital consumption prerequisites

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Financial Overview has solid free income era $15.7M Free Cash Flow 1 in 2007 $67M of stock repurchased from Jul-06 to Sep-08 has a solid monetary record $94M money and ventures with no obligation (starting 09-30-08) ~$240M in Federal NOL\'s and $150M in State NOL\'s (starting 09-30-08) speaking to ~$95M Deferred Tax Asset To safeguard full utilization of the NOL\'s, the "NOL Protective Measures" were passed by shareholder vote that confine buys of\'s stock that would make another 5% shareholder without first getting a waiver from the Company\'s Board of Directors 2 The Company emphatically encourages speculators intrigued by owning 725K shares

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