MONTHLY NEWSLETTER TO START
In a move to keep our Shareholder's better informed of the latest Corporate Developments taking place here at e-Smart, I have decided to introduce a web-site "Newsletter" to be known as "News From the Chairman". This Newsletter will be updated monthly and will be my attempt to give its readers a fair statement of the Company's activities as can be revealed without compromising Company business prospects or regulations that govern public companies. I sincerely hope that in presenting this newsletter, I will be able to instill the feeling of excitement with respect to the opportunities that we in the Company all feel about e-Smart to all of you that are interested in e-Smart's future.

NEW PRODUCT NEWS
e-Smart is proud to announce that it is planning to add a revolutionary new electronic passport as part of its security product offerings. e-Smart has created what it believes to be a tamperproof, counterfeit proof electronic package that can fit into the inside back (or front) cover of a passport. This electronic package turns the passport into a complete biometric system that is near stand alone and can verify both facial characteristics and fingerprint characteristics in the blink of an eye. This product, currently known as the "Super Smart Passport" has been designed to exceed ICAO (International Civil Aviation Organization) guidelines. As with all e-Smart IC based products, e-Smart's Super Smart Passport is compatible with ISO standards for both communication and power. e-Smart believes that its Super Smart Passport is superior to all other e-passports offered by its competitors in that it provides up to two biometric verifications (facial and fingerprint) in a privacy protected environment that protects privacy and civil rights. Product demonstrations are already being made to a select group of appropriate government agencies in various countries.

e-SMART MANAGEMENT TEAM IN KOREA
In order to support its recently opened subsidiary in Seoul, Korea; a team consisting of e-Smart's CTO, CIO and the undersigned are as of the date hereof, attending meetings in Seoul arranged by our Korean Office colleagues. These meetings are designed to bring potential customers and potential partners in Korea up to date with e-Smart's latest products and to discuss various mutually beneficial business opportunities. While there can be no assurances, there is every expectation that one or more agreements will be reached as a result of these meetings that will cause e-Smart to implement its offerings in one or more locations.

e-Smart's team has and will visit other countries in the region, including China, to clarify in person a number of pending contracts that are under discussion in these countries. And while again there can be no assurances, the Company is very confident that it will conclude one or more of these pending contracts with governments and/or major companies in Asia in the near future.

e-SMART AT HOME
We continue to relentlessly pursue U.S. Domestic opportunities. From my base in Washington DC, I am constantly in touch, directly or indirectly with all relevant parties connected with the US Government contracts that we are trying to achieve. We have made proposals to implement the BVS2™ system and the Super Smart Card™ in the USA that are both beneficial for the US Government and for the Company. And while again there can be no assurances, we feel confident that one or more of these proposals will be accepted by one or more agency of the US government. In addition, the Company has been pursued by several large international US companies which are both seeking to obtain and have been awarded large US Government contracts. These companies are seeking our BVS2™ system technologies and Super Smart Cards™ in order to fulfill their government contract requirements. We are in active negotiations with these companies and while we expect a favorable result in one or more instance, we cannot yet predict the outcome of such negotiations.

CONCLUSION
Because the time to take advantage of the many opportunities presented to the Company is immediate, I cannot answer all of the calls and letters I receive from all of our dear and loyal Shareholders (and others). It is my sincere hope that this newsletter will answer some of your questions and concerns. I thank all of our Shareholders for their continuing support and hope all of us will be rewarded very soon.