Litronic and Key Tronic Announce Industry's First Integrated Keyboard and Smart Card Reader Connected Using Only Standard PS2 Keyboard Cable

Business Wire, July 16, 1999

IRVINE, Calif.--(BUSINESS WIRE)--July 15, 1999--

Litronic Inc. (Nasdaq:LTNX), a leading provider of Internet security solutions, and Key Tronic (Nasdaq:KTCC), one of the world's largest independent producer of keyboards, Thursday announced a low cost, highly integrated keyboard with an onboard smart card reader.

Unlike previous products, this integrated solution works with a single cable and provides users with a more cost effective and easy-to-use device.

Key Tronic's Secure(TM) Smart Card keyboard features Litronic's 230 smart card reader on the keyboard, and enables secure log-on protection while maximizing a user's keyboard desktop space.

"Our smart card keyboard is a very efficient, space-saving and cost-effective smart card device," said Craig Gates, Key Tronic's vice president of sales, engineering and marketing. "The real benefit is that the smart card reader is an integrated system component rather than an add-on device."

"Single cable functionality is a primary installation issue for the customer, and is addressed successfully in this product," said Bob Gray, vice president of product development at Litronic. "The single cable feature is a big advantage over competitive readers, which still require an additional serial connection."

Litronic developed the firmware and proprietary information in the keyboard while Key Tronic executed the mechanical integration. The resulting product is a standard size keyboard with the reader integrated on the top, right side. This innovative design solves problems faced by competitive products, which have difficulties interfacing with the motherboard.

"Developing this project was a joint effort," said Gray. "Litronic wrote the device driver for Windows that allows the reader to operate with the keyboard and assisted in advancing the firmware in the keyboard with Key Tronic. Most important in developing the firmware was designing it to accomplish a Protected Pin Path mode."

A Protected Pin Path mode verifies a pin without having the microprocessor forward the pin number to the PC. Rather, the microprocessor forwards the pin number to the smart card reader for authentication. The Protected Pin Path mode accepts the characters and forwards it to the smart card. The smart card matches and the keyboard notifies the PC if the pin is accurate. With this added security, a Trojan Horse cannot sniff, accept or change pin codes.

The Key Tronic Secure Scanner keyboard with Litronic 230 reader is currently available at an MSRP of $135 through both companies' Web sites and distributors. Discounts are available in larger quantities.

About Litronic

Litronic provides professional Internet data security services and develops and markets software and microprocessor-based products needed to secure electronic commerce business transactions and communications over the Internet and other communications networks based on Internet protocols.

Litronic's primary data security products use an advanced form of computer security technology referred to as public key infrastructure (PKI). Litronic's Internet security products can be used with World Wide Web browsers, including Netscape Communicator and Microsoft Internet Explorer. Additional information on Litronic is available on the company's Web site at http://www.litronic.com.

About Key Tronic

Key Tronic Corp. is one of the world's largest independent producers of keyboards and has long been a leading innovator with state-of-the-art computer input devices. The company manufactured the first keyboards that incorporate Universal Serial Bus (USB) technology, and the first thin client terminal built into a keyboard. Key Tronic also offers network security devices that require fingerprint recognition instead of passwords to access a network.

Key Tronic's customers include Hewlett-Packard, IBM, Gateway, Toshiba, Nortel and other leading international companies. The company had sales of $170 million for fiscal year 1998. Key Tronic employs approximately 2,400 people and operates facilities in Spokane, Wash., Mexico and Ireland. Information about Key Tronic and its products can be found on the World Wide Web at http://www.keytronic.com.

Safe Harbor Statement Under the Private Securities Litigation

Reform Act of 1995

With the exception of historical information, the matters discussed in this news release relating to the projected growth of e-commerce and of the Internet security market; and to Litronic's ability to penetrate the Internet security market, to integrate acquisitions and to transition to commercial markets are forward-looking statements that involve a number of risks and uncertainties, including competition from companies with greater financial and technical resources than Litronic, the difficulty in continuing technical innovation (particularly in light of the competitive market for technical personnel), the effect of differing corporate cultures on the integration of acquisitions and the acceptance of Litronic's products in the commercial marketplace. Other risks inherent in Litronic's business are described in Securities and Exchange Commission filings, including the company prospectus. Litronic undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.