American Bank Note Holographics, Inc. (ABNH) originates, produces, markets and sells holograms and products incorporating holograms. The Company's products are used primarily in security applications, including authentication of transaction cards, identity documents, documents of value and various consumer products. The Company also produces non-secure holograms for design and promotional applications. ABNH has five target markets, and the Company markets various products to meet the needs of these markets: Transaction Cards, Identification Documents, Product Authentication and Security Packaging, Documents of Value, and Commercial. The Company's products are used by over 200 companies, including MasterCard, VISA, American Express, Discover, Diners Club, Sears, Nordstrom, Quaker State, Sony, Nike, Eli Lilly and Janssen-Cilag, as well as the United States Government and other governments and companies. Transaction Cards ABNH markets its secure holograms for use on transaction cards and enabled to create and expand the security sector of the holography market. Holograms have been established as a fraud prevention device on transaction cards. They are also commonly used to enhance the brand image of a transaction card issuer. The Company's products include Holographic Hot-Stamp Patch, HoloMag and HoloCard. Identification Documents ABNH provides secure holographic laminates and patches for identity documents, such as national identification (ID) cards, passports, government credentials, military credentials and drivers' licenses. The Company has patents on demetallized holograms, which are transparent and used to see printed information under the holograms. ABNH supplies demetallized laminates for certain secure United States Government credentials, as well as national identifications (IDs) for certain foreign countries. Product Authentication and Security Packaging The use of holograms for product authentication and security packaging is driven by concerns regarding counterfeiting, piracy, pilfering, diversion and other infractions that can result in lost sales, lost goodwill and product liability claims. Holograms are used as authentication devices in, among others, pharmaceuticals, licensed consumer products and high-value consumer and industrial products. Product authentication holograms are either machine or hand-applied to individual products. A holographic label that is tampered with can become permanently damaged, leaving a visible footprint on the product. The Company's products for this market segment include Holographic Labels, HoloSeal, HoloCap and Holographic Shrink Sleeves. Documents of Value Concerns over counterfeiting and copying have led to an increased use of holograms produced by international suppliers for international markets for currency, checks, gift certificates, tax stamps and other financial instruments. Holographic products for paper documents of value include Holographic Thread, Holographic Ribbons and Holographic Patch. Commercial ABNH also produces holographic imagery for decorative and promotional purposes. The Company's products for this market include pressure sensitive labels with an array of designs and wide Web holographic patterns for flexible packaging applications.

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