Wave Systems Corp. (fka WAVXQ)

[Snackman]

From Countryboy.

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Snackman
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Posted on Wed, Feb. 26, 2003

Touch voting devices get OK

BOARD TO LET STATE DECIDE ON PAPER RECEIPTS

Santa Clara County supervisors rejected pleas from computer scientists Tuesday that they require new electronic voting machines to produce a paper trail after each touch-screen vote is cast, leaving that decision to the California secretary of state. But supervisors did vote to set up a limited pilot project for November's election that will give some voters a
physical receipt to verify their otherwise ethereal ballot.

``The good news is that the supervisors have seriously had their awareness raised to the possibility of fraud and undetected malfunctioning or errors,''said computer scientist Peter Neumann. The bad news, added Stanford University voting expert David Dill, ``is that the door is not closed on the wrong thing happening.

``They may make history, but they haven't yet,'' he said.After Tuesday's 3-2 vote, supervisors will begin negotiating with Sequoia Voting Systems of Oakland to buy at least 5,000 electronic voting machines. The company will get the $20 million contract only if it agrees to provide paper printouts
when -- and if -- the California secretary of state calls for printed verification of electronic votes.

State leaders are watching progress here, in one of the last California counties to cast off the outdated punch-card ballots.

This month, in response to stepped-up pressure from a nationwide network of computer scientists, voting rights advocates and security and fraud experts, California Secretary of State Kevin Shelley launched a task force on electronic voting. Members are expected to call for security guidelines and the need for verification of votes.

Shelley has the power to certify -- and decertify -- voting machines in California. If he ultimately decides that voting machines in California must produce a paper trail for both voters and officials doing recounts, manufacturers will have to build in printers.

The machines Santa Clara County may soon purchase are now 6 months old, a prospect that worried supervisors Liz Kniss and Jim Beall, who voted against the Sequoia negotiations. ``We are looking at first-generation models when second-generation models exist, and I'm very troubled by that,'' Kniss said.Others at Tuesday's board meeting also urged caution, with so much at stake for the county's 730,000 registered voters and precincts across the country looking to this technological heartland for leadership. Ed Morillo, a county elections specialist, urged the board to make the right decision, not a hasty one.

Remember, he said: ``The value of one vote is the only thing the rich man and the poor man have in common.''

http://www.bayarea.com/mld/mercurynews/news/5265672.htm?template=contentModule
s/printstory.jsp

Posted on Wed, Feb. 05, 2003
Santa Clara County postpones buying electronic voting booths

By Katherine Corcoran
Mercury News
The Santa Clara County Board of Supervisors delayed choosing a vendor for a new electronic voting system Tuesday, citing questions about cost, security and accessibility of the new machines to the disabled.

The board, under federal court order to replace its punch-card system before the March 4, 2004, presidential primary, received a recommendation from staff to negotiate a contract with Sequoia Voting Systems of Oakland to implement 5,000 touch screens in 1,000 precincts, a system that will cost $20 million.But supervisors decided they needed more time to consider the move to electronic voting after hearing from several computer scientists, who said that the system could be easily manipulated or tampered with.More than 100 computer scientists and experts have signed a petition asking that any electronic voting system include a way for voters to receive a paper copy that will verify the vote they recorded electronically.

With the proposed Sequoia system, ``there's no assurance that the vote that appears on the screen is the one that's recorded,'' said Peter Neumann, principal scientist at SRI International in Menlo Park.Sequoia officials said safeguards are programmed into the machine to prevent tampering and to check for accuracy. But they also said if the supervisors want machines to produce voter-verifiable paper ballots, Sequoia would add that capability.

Supervisor Jim Beall said he wanted more information on whether the machines will be accessible to people with disabilities, including the blind.Board Chairman Blanca Alvarado said she also is concerned about costs. While $9.5 million is supposed to come from the state, she said there's no guarantee the county will be reimbursed given the budget crisis.

The registrar of voters chose Sequoia after reviewing proposals from three vendors, basing their decision in part on input from consultants, a county technical team, and potential voters, who tried all three systems. County staff recommended Sequoia because it had the best system for handling the county's
multilingual ballots.

The board will take up the issues again in work session at 2p.m. Tuesday and is scheduled to make a final decision Feb. 25.

http://www.bayarea.com/mld/mercurynews/news/local/5109600.htm?template=content
Modules/printstory.jsp

Kniss Try: Fostering open competition or helping pals?

Kniss Takes Stock
Palo Alto millionaire and Santa Clara County Supe Liz Kniss is sweet on voting-machine provider wannabe Hewlett-Packard. And that's probably not just because her husband, Rick Kniss, worked as senior VP of HP offshoot Agilent Technologies, either. Nor does her corporate friendship stem from designs on Joe
Simitian's Assembly seat, as she insisted to Eye last week that she has none. Eye learned from one alert source that the Knisses owned millions of dollars worth of HP and Agilent stock. According to her March 29, 2002, Statement of Economic Interests, the former Palo Alto mayor and Sun Microsystems PR flak owned more than a million bucks worth of HP stock, as well as a seven-figure chunk of Agilent. Eye's spy says that at the board's Tuesday, Feb. 25, meeting, through an aide Kniss pushed her hometown company to present its case for the $20 million contract, despite the fact that the company wasn't even in the running. She also made a motion to throw out the first Request for Proposal process and start over to give recently state-certified voter-machine vendors HP and others another chance. But it flopped. Only three providers--Sequoia, Election
System and Software, and Diebold Election Systems--made it to the finals, because they were the only vendors with state-certified machines at the time the bidding process beggn. As for HP, "They kind of came in at the very last minute,"
notes Supervisor Pete Mchugh's voting-policy aide, Mainini Cabute. Kniss was in Washington, D.C. this week and unavailable for a chat. But Kniss' aide, Ernie Tedeschi, tells Eye he asked Kniss about the stock. "I'm not sure of the details of that," he says, "but my understanding is that they sold all the stock
when [Rick Kniss] retired." Sadly for her, Kniss failed to stop her colleagues on the Board of Supes from picking Sequoia voting Systems as the valley's new ATM-esque mechanical voting system. Happily for Kniss, she sold her stock at a good time.

http://www.metroactive.com/papers/metro/03.06.03/public-eye-0310.html


News Release 29 May 2002
De LA RUE ACQUIRES NORTH AMERICAN ELECTION SYSTEMS BUSINESS

De La Rue, the cash to secure transactions Group, has today announced the acquisition of 85% of the share capital of Sequoia Voting Systems Inc. ("Sequoia") one of the largest providers of voting equipment, software, ballot printing and election services in the USA. De La Rue has acquired the business
from Jefferson Smurfit Group plc, the international paper and packaging company who, under the terms of the agreement, will retain 15% of share capital in the business for a minimum of three years. The consideration is US$ 23m, (£15.8m) with a further payment of up to US$12m (£8.3m) dependant on certain performance criteria being met, linked to agreed sales growth. As at 31 December 2001, Sequoia had estimated net shareholders' funds of $4.2m and the transaction will be debt free and earnings neutral in the current year.

Sequoia offers hardware products in all major segments of the North American elections market, including direct recording equipment and optical scan systems. The company also supports its hardware with proprietary software systems enabling municipalities to fully computerise their voter registration, ballot creation and election tabulation processes. With over 25,000 touch screen and electronic voting machines in use across the USA, Sequoia is a leading supplier of electronic voting machines in the country. The company also operates a
printing business to support customer needs for paper ballots (punch cards and optical scan) and information booklets. Based in Oakland, CA Sequoia currently employs 140 staff with a strong customer base in the West Coast and North East of the USA.

De La Rue is acquiring the business as part of its strategy to invest in new business opportunities and also to build on its position as a leading provider of secure, government identity solutions. De La Rue sees the election systems market as having strong potential for growth with Sequoia well positioned to
take advantage as the market in the USA moves to increasingly automated voting solutions. In the short term, expectations are high that some US$3-US$5bn of Federal funding for electoral reforms will accelerate the evolution of the market to adopting highly secure automated election systems. In addition, in the
medium term De La Rue sees opportunities for future revenues through servicing and upgrading of the installed base of hardware and software and the provision of technical and consultative services. De La Rue also sees potential for international expansion of the business through leveraging De La Rue's strong relationships with the world's governments.

Based on the unaudited management accounts for the 12 months ended 31 December 2001 the business had a turnover of US$27.5m (£18.9m)and recorded an operating loss of US$10m (£6.9m). However 2001 was not a typical year due to the market awaiting the outcome of Federal electoral reform funding initiatives. In
2000 the business made a profit of US$6m on sales of US$45m and will also be profitable in the current year based on management projections. During 2001, the business also invested in developing its product range ahead of the anticipated increase in demand and has subsequently won a number of contracts in
the current year incorporating its touch screen voting technology.

The business will continue to report to current Sequoia President, Peter Cosgrove who will report directly to De La Rue Chief Executive, Ian Much. This is in order to take full advantage of the immediate growth opportunities in the
North American market and to explore the opportunities for further longer term growth in services in the USA and international expansion. For financial reporting purposes the business will report within the Global Services division.
It will continue to use the Sequoia brand in the USA market where it has an excellent reputation.

Commenting on the acquisition, Chief Executive, Ian Much said:

"The acquisition of Sequoia Voting Systems adds a new strategic dimension to De La Rue's range of secure transaction solutions and complements our existing core competencies in providing worldwide government identity solutions. Sequoia is a major player in the US election systems industry with an excellent
range of voting solutions with considerable knowledge and expertise of the North American market. Coupled with De La Rue's solid financial strength, strong international government relationships and geographical reach, this acquisition
allows us to immediately capitalise on this growing market in the USA. Looking to the medium term it will also allow us to expand the business internationally in the future using our combined strengths."

http://www.delarue.com/DLR_Content/CDA/Pages/News/articles/210/0,1820,,00.html