Satisfaction
      and Release of Security Interest

    


    Name
      of Debtor: Catuity,
      Inc., a Delaware corporation (“Debtor” or Catuity”).

    


    Name
      of Lenders/Secured parties: Gottbetter
      Capital Master, Ltd., a Cayman Islands company (“Gottbetter”) and Bridgepointe
      Master Fund Ltd., a Cayman Islands Exempted Company (“Bridgepointe”)(each
      individually, a “Lender” and collectively, “Lenders”).

    


    For
      purposes hereof:

    


    “BridgePointe
      Debt” means a Secured Promissory Note issued by Catuity to Bridgepointe dated at
      of November 22, 2006 in the original principal amount of $688,888, and a new
      Secured Promissory Note issued by Catuity to Bridgepointe dated as of July
      5,
      2007, in the amount of $75,000 (the “BridgePointe $75,000 Note”).

    


    “BridgePointe
      Net Settlement Amount” means $75,000, plus the interest accrued on the
      BridgePointe $75,000 Note through the date that funds are wired to BridgePointe,
      plus 38.3% of the Net Convertible Settlement amount.

    


    Gottbetter
      Debt” means a Secured Promissory Note issued by Catuity to Gottbetter dated at
      of November 22, 2006 in the original principal amount of $1,111,112, and a
      new
      Secured Promissory Note issued by Catuity to Gottbetter dated as of July 5,
      2007, in the amount of $75,000 (the “Gottbetter $75,000 Note”).

    


    “Gottbetter
      Net Settlement Amount” means $75,000, plus the interest accrued on the
      Gottbetter $75,000 Note through the date that funds are wired to Gottbetter,
      plus 61.7% of the Net Convertible Settlement amount.

    


    “Loyalty
      Magic Shares” means 4,216,708 fully paid ordinary shares in Loyalty Magic Pty
      Ltd (ABN 51 075 350 239), which constitutes all of the issued shares in the
      Company. 

    


    “Net
      Convertible Settlement Amount” means AUD $2,650,000, less reasonable attorneys
      fees to Arnold Bloch Leibler, Lawyers and Advisers in an amount not to exceed
      AUD $20,000 and less $50,000 in expenses to Catuity, less the $75,000 plus
      accrued interest to be paid to Gottbetter for its $75,000 Note in accordance
      herewith and less the $75,000 plus accrued interest to be paid to BridgePointe
      for its $75,000 Note in accordance herewith.

    


    For
      valuable consideration, the parties agree as follows:

    


    I.
      Subject to receipt of a wire transfer by BridgePointe of the BridgePointe Net
      Settlement Amount, BridgePointe hereby certifies that all of Catuity’s debt to
      BridgePointe, including but not limited to the BridgePointe Debt, has been
      settled, satisfied and paid in full, and the lien therein created and retained
      is hereby released.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    II.
      Subject to receipt of a wire transfer by Gottbetter of the Gottbetter Net
      Settlement Amount, Gottbetter hereby certifies that all of Catuity’s debt to
      Gottbetter, including but not limited to the Gottbetter Debt has been settled,
      satisfied and paid in full, and the lien therein created and retained is hereby
      released.

    


    III.
      Specifically, subject to receipt of a wire transfer by BridgePointe of the
      BridgePointe Net Settlement Amount and receipt of a wire transfer by Gottbetter
      of the Gottbetter Net Settlement Amount, Lenders, jointly and severally, release
      Debtor from the following specific security agreement:

    


    Security
      Agreement dated on or about November 21, 2006 by and between the Debtor and
      the
      Lenders. 

    


    and
      release their security interest in the Collateral described in the Security
      Agreement and in following property of the Debtor:

    


    All
      personal property of the Debtor, wherever located, whether now owned or
      hereafter acquired and whether now existing or hereafter coming into existence,
      including but not limited to the Loyalty Magic Shares (as defined
      below).


    


    Lender
      has not assigned any claims or obligations covered by this Release to any other
      party.

    


    Lenders
      will each sign a Release of U.C.C. Financing Statement in each U.S. state where
      such a statement was filed with a public agency.

    
      	 	 	 	 
	
              Lender:

              Gottbetter
                Capital Master, Ltd.

            	 	 	
              Lender:

              BridgePointe
                Master Fund Ltd.

            
	 	 	 	 
	Signed: 	 	 	Signed:
	
              
                

              

            	 	 	
              
                

              

            
	 	 	 	 
	Print name: 	 	 	Print
              name:  
	
              
                

              

            	 	 	
              
                

              

            
	 	 	 	 
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	Date: 	 	 	Date: