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AffinityTechnology Group Engages Morgan Keegan

Affinity Engages Morgan Keegan to Raise Additional Capital and the McBride Firm to Assist with Patent Licensing and Litigation

July 11, 2006--Affinity Technology Group, Inc. (OTCBB:AFFI - News) today announced that it has engaged Morgan Keegan & Company as its exclusive financial advisor to assist the company in raising additional capital and to assist with its patent licensing program. In addition, Affinity has engaged McBride Law, PC of Santa Monica, California as additional counsel with Withrow & Terranova, the Company's current patent licensing representative, to join ongoing patent litigation and the Company's patent licensing program.


Joe Boyle, President and Chief Executive Officer, stated, "We are very pleased to have Morgan Keegan and the McBride Law firm join us as a part of our team." As previously reported, Affinity was notified on March 30, 2006 that the U.S. Patent and Trademark Office had concluded its two year reexamination process, which was initiated by third parties, and resulted in the full allowance of all the claims of the Company's U.S. Patent No. 6,105,007. This decision was preceded by similar successful reexaminations of the Company's U.S. Patent No. 5,870,721C1 and U.S. Patent No. 5,940,811C1. "With the successful reexamination process now behind us and the addition of Morgan Keegan and the McBride Law Firm, Affinity is better positioned to move forward with a vigorous commercialization effort for its broad intellectual property position."

Under the terms of the two-year agreement, Affinity has issued Morgan Keegan a five-year warrant to acquire 2,500,000 shares of Affinity's common stock for $0.50 per share. Affinity's stock price closed at $0.18 per share at the end of trading on Monday. In addition, Affinity has agreed to pay Morgan Keegan a cash fee ranging from 1% to 5% of the amount of capital raised by Morgan Keegan for financings over $5 million. Morgan Keegan has agreed to assist Affinity in placing the remaining $1.4 million under its convertible debenture program for no additional cash fee.

Under the revised agreement with Withrow & Terranova and the addition of the McBride Law firm, Affinity has maintained its existing 25% contingency fee structure, which is payable on all amounts received by the Company as a result of patent litigation and/or patent licensing, with 19% payable to Withrow & Terranova and 6% payable to the McBride Firm. In connection with contingency fees payable to the attorneys for patent licensing unrelated to litigation, the 25% fee structure decreases on a sliding scale to a minimum of 5% as the cumulative amount of patent licensing revenues exceeds $100 million. In addition, Affinity has agreed to pay 50% of these firms' billing rates for work done for the Company.

About Affinity Technology Group, Inc.

Through its subsidiary, decisioning.com, Inc., Affinity Technology Group, Inc. owns a portfolio of patents that covers the automated processing and establishment of loans, financial accounts and credit accounts through an applicant-directed remote interface, such as a personal computer or terminal touch screen. Affinity's patent portfolio includes U. S. Patent No. 5,870,721C1, No. 5,940,811C1, and No. 6,105,007.

Forward-looking statements in this news release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that our business is subject to several substantial risks and uncertainties, including the Company's very limited capital resources and the possibility that we may be unable to raise additional capital in amounts sufficient to permit us to continue operations; the risk that we may lose all or part of the claims covered by our patents as a result of challenges to our patents; the risk that our patents may be subject to additional reexamination by the U.S. Patent and Trademark Office or challenge by third parties; the possibility that all or some of the holders of the convertible secured notes issued by the Company may take action to collect the amounts outstanding under these notes; the result of ongoing litigation; and unanticipated costs and expenses affecting the Company's cash position. If the Company is not able to raise additional capital immediately, it may be forced to consider alternatives for winding down its business, which may include offering its patents for sale or filing for bankruptcy protection. Moreover, if any of the holders of the convertible notes issued by the Company take action to collect the amounts owed by the Company under these notes, the Company will be forced to consider alternatives for winding down its business, which may include offering its patents for sale or filing for bankruptcy protection. These and other factors may cause actual results to differ materially from those anticipated.

posted by Famous Quotations @ 5:01 PM