Pipeline Data Inc.

1

• Pipeline Data Inc.
• Annual Shareholder Meeting
• May 22, 2008

2
Investor Disclaimer

• The information provided for in this investor
  presentation contains forward-looking statements
  that involve risks and uncertainties more fully
  set forth in the Company's filing. Certain
  information included in this presentation may
  contain statements that are forward-looking, such
  as statements relating to uncertainties that
  could affect performance and results of the
  Company in the future and, accordingly, such
  performance and results may materially differ
  from those expressed or implied in any
  forward-looking statements made by or on behalf
  of the Company. These risks and uncertainties
  include, but are not limited to those relating to
  the Company's growth strategy, customer
  concentration, outstanding indebtedness,
  seasonality, expansion and other activities of
  competitors, changes in federal or state laws and
  the administration of such laws, protection of
  the securities markets and other risks detailed
  in the Company's filings with the Securities and
  Exchange Commission.
• Readers are cautioned not to place undue
  reliance on these forward-looking statements,
  which speak only as of the date the statement was
  made. The Company's actual results could differ
  significantly from those discussed and/or implied
  herein.

3
Company Profile
Pipeline Data Inc. (PPDA) is a value-added
provider of merchant payment processing services
and other related software products. The Company
currently delivers credit and debit card-based
payment processing and related services to small
to medium-sized merchants who operate either in a
physical brick and mortar business environment
or over the Internet. Pipelines payment
processing services enable merchants to
process both traditional card-present, or swipe
transactions, as well as card not-present transact
ions. For more information please visit
www.pipelinedata.com.  
Credit Card Processing and Merchant Accounts
4
Pipeline Companies

• Northern Merchant Services, Inc.
• Bank referral division representing 54 banks,
  comprising 420 bank branch
• locations, along with 48 credit unions
• SecurePay, Inc.
• Custom credit card transaction processor
  serving as a gateway
• intermediary between the customer and the
  financial networks, integrating
• shopping cart, gateway and custom third-party
  solutions
• Pipeline Data Processing, Inc.
• Provider of wholesale payment processing
  solutions, new account
• boarding, underwriting and risk management
• Charge.Com, Inc.
• Internet industry leader in merchant account
  acquiring and marketing
• AIRCHARGE, Inc.
• Provider of cellular phone-based credit card
  acceptance solutions for mobile business
  merchants

5
Industry overview

• The use of non-cash forms of payment, such as
  credit and debit cards, has steadily increased
  over the past ten years.
• The Nilson Report, a leading industry
  publication that tracks the transaction
  processing industry, is forecasting the
  following
• Global purchase volume grew at a compound annual
  growth of 14.0 over the period 2000-2006

6
Large and Growing Market
Merchants locations accepting credit cards
continue to grow
2010
2000
2005
CAGR 10
Traditional 28
Electronic 72
Electronic 36
Electronic 51
Traditional 49
Traditional 64
5.3 trillion transactions
6.7 trillion transactions
8.2 trillion transactions
First Annapolis Consulting Inc.
7
Large and Growing Market
Small merchants represent a large market
opportunity

• Pipeline Data focuses exclusively on the 5
  million small merchants that generate 422
  billion in Visa / MasterCard charge volume

2.202 trillion

• Small merchants represent an attractive customer
  base
• Largest market
• Fastest growing market
• Difficult to identify and serve less
  competition
• Most profitable to merchant processors

The Nilson Report
8
Stable and Recurring Revenue Base

• Processing fees paid by merchant are recurring in
  nature
• Credit card processing is vital to a merchants
  success
• Approximately 88 of Pipeline Datas volume
  recurs

9
MasterCard and Visa IPOs
12 months
MasterCard
2 months
Visa
10
Efficient Model

• Pipeline enjoys low costs related to account
  acquisition
• through the Internet and strategic partners
• Pipeline generates leads from potential merchants
  via the Internet.
• The Company also obtains leads via call
  generation and other marketing media.
• Pipeline owns a sophisticated call center that
  enables quick turnaround. Merchants can be
  activated for card acceptance within 24 hours.
• Pipeline Data has favorable search engine
  positioning through its proprietary optimization
  tools.
• Optimal positioning places the Company in prime
  viewing area for potential customers who search
  via the Internet.
• A high barrier to entry gives Pipeline Data a
  significant cost advantage over its competitors.

11
Organic Growth Strategy

• Management seeks to aggressively grow the number
  of merchant accounts serviced through the
  solicitation of new merchant accounts.
• The Pipeline sales team intends to expand the
  portfolio of merchant clients through internal
  sales efforts augmented by expanding marketing
  and advertising. Management focused on aligning
  marketing, sales capacity and sales incentives in
  a cost-effective sales cycle.
• The Company aims to achieve greater business
  efficiencies by creating, operating and
  continually enhancing processing and servicing
  operations in an efficient and scalable manner.
• The Companys service and support platforms are
  completely flexible, enabling merchant
  customization to meet the their specific
  requirements.

12
Application Growth
Application Count by Month (Trailing 15 months)
13

• Financial Overview

14
Financial Overview (,000)

• 2007
• Revenue of 49,903 up 19 from 41,814 in 2006
• Gross Profit of 17,716 up from 14,926 for 2006
  
• EBITDA of 5,765 compared to 3,392 for 2006
• Adjusted EBITDA of 6,389 compared to 6,339 for
  2006
• Net Income (loss) of (1,970) compared to
  (2,286) for 2006
• 1st Quarter 2008
• Revenue of 11,410 down 3.8 compared to 1Q2007
• Gross Profit of 4,306 up 10.2 from 3,908 for
  1Q2007
• EBITDA of 888 compared to 1,148 for 1Q2007
• Adjusted EBITDA of 953 compared to 1,256 for
  1Q2007
• Net Income (loss) of (1,161) compared to
  (1,098) for 1Q2007

15
Annual Financial Results
16
(No Transcript)
17
Financial Results Year End Comparative
Balance Sheets
18
Financial Results-Cash Flows Selected Data
19
1st Quarter Financial Results
20
Financial Results Year End and March 31 Balance
Sheets
21
Financial Results-Cash Flows Selected Data
22
COCARD TRANSACTION

• Details behind Merger

23
OPPORTUNITY

• Combine Pipeline and COCARD together at an
  estimated 6.5X pro forma EBITDA
• Historically this is between 1-2X the EBITDA
  multiples of most comparable trading values and
  represents a 40-50 discount to the average sale
  and going private multiples over the last several
  years.
• Take advantage of a unique opportunity to
  incorporate Pipelines excess processing capacity
  and extremely attractive pricing into COCARD
• Plug the COCARD sales engine into the Pipeline
  processing machine to increase the reach of
  Pipeline beyond the Internet marketing engine it
  has developed
• Repurchase ownership of the main portfolio at NPC
  and use it to increase cash flow and drive down
  costs
• Combining the processing volumes of the two
  companies will drive transactional pricing down
  through the Fidelity National Information
  Services contract previously negotiated.

24
Highly Complementary

• Both Pipeline and COCARD are companies involved
  in the processing of credit and debit card
  transactions and related services. Each has a
  unique and complementary approach to the merchant
  service processing (MSP) business.
• Pipeline is a leader in boarding and servicing
  e-commerce merchants. Its primary distribution
  channel is through its Internet marketing
  initiatives.
• COCARD is a leading marketing organization whose
  distribution channel is independent sales offices
  that focus primarily on retail merchant sales.
• COCARD produces between 650 and 800 new merchant
  accounts each month.
• COCARD is comprised of over 71 sales offices (as
  of December 31, 2007).
• Pipelines risk, underwriting and customer
  service departments will be utilized for new
  COCARD merchants, as well as the approximately
  27,000 existing merchants that will be converted
  to the preferential pricing provided by the
  combined volumes of the two entities.
• Pipeline will process and support the merchant
  base derived from the sales efforts of all of its
  combined entities, including COCARD and all of
  its sales offices and agents.

25
Operational Efficiencies

• Pipeline would have processed over 75 million
  transactions and 5.1 billion in transaction
  volume per year on a pro forma basis for 2007.
• Pipeline is qualified to provide direct-connect
  card association authorizations, which will
  magnify the Companys already significant
  processing capability.
• COCARDs business will flow through Pipelines
  access points, providing significant leverage
  with the Companys transaction settlement
  providers.
• Pipeline has already achieved significant price
  discounts from its settlement providers. By
  combining the volume of Pipeline and COCARD, the
  Company has the ability to achieve additional
  discounts from these providers.

26
Roles and Capabilities
Acquiring has a fairly complex value chain which
gives rise to a number of different business
models and types of players in the market.
Merchant Services Value Chain Business Models
MARKETING ACCOUNT SETUP
BACK-OFFICE SUPPORT
TRANSACTION PROCESSING
Network/ Clearing
Deployment Activation
Front-end Processing
Operations/ Risk Mgmt
Merchant Servicing
Relationship Mgmt
Back-end Processing
Underwriting Boarding
Sales Marketing
Product Dev. Mgmt
Fully Integrated Large Bank Acquirer (example
Fifth Third)
Fully Integrated Non-Bank Acquirers (example
Global Payments)
SponsorBank
Bank non-Bank Alliance (ex. First Data, Wells
Fargo Merchant Services)
Bank
Regional Bank Acquirer (ex. Commerce Bank)
3rd Party Processor
More Sophisticated ISO (ex. iPayment)
3rd Party Processor (ex. TSYS)
3rd Party Processor
Less Sophisticated ISO (or Small Referral Bank)
27
Actual Results 2007, Pro forma and Baseline
Projections 2008
Consolidated Pipeline/COCARD Financials
28
Current Debt Funding Term Sheets

• 50 million from a major financial institution at
  a cost of L450 (8)
• 5 million from draw on revolving credit
• further availability limited to 7 million until
  credit metrics are achieved either 1.5x EBITDA
  or 2x Gross Profit
• 25 million term loan, 5 year maturity
• 40 million from an institutional lending source
  at 13.5
• No amortization, 5.5 year maturity
• Repayable at 105 year 1, 103 year 2
• 11 million in 12 sellers financing notes from
  COCARD and other parties to the transaction

29
REVOLVING CREDIT AVAILABILITY

• VS 1.5X LTM trailing EBITDA.
• Example- Estimated LTM EBITDA at close will be
  24 million in adjusted pro forma EBITDA
• Availability would be 1.5X 24 million36
  million plus reimbursement of 2 million in cash
  expenses already paid plus 500,000 estimated
  cash on hand
• Thus, availability 36m2m500,000 38.5
  million
• Funding available to support the transaction
  38.5m-10.00m in working capital28.5 million

30
Comp Loan Metrics and Key Terms
31
Estimated Capital Structure Pro forma
32
Estimated Cash Flow and Potential Debt
Amortization Pro forma (low end case 09)
33
Total Estimated Sources and Uses
34
Rationalization

• The combination of Pipeline and COCARD brings an
  opportunity to rationalize the operating
  structures of both companies.
• Pipeline possesses a significant Internet
  service, as well as a back office and information
  technology structure capable of servicing the
  combined companies.
• As a cooperative, COCARD did not build its own
  infrastructure. Instead, it entered into an
  agreement with National Processing Company
  (NPC) for the back-end settlement of
  transactions. Under the terms of the agreement,
  each ISO provides its own services and is
  responsible for its own selling, general and
  administrative expenses.

35
Significant Growth Drivers

• Proprietary advantages and sales engines
• Top-tier search engine placement
• Advanced underwriting and application processing
  technology
• Proprietary gateway and shopping cart solutions
• Proprietary wireless payment solutions
• Acquisitions
• Highly fragmented merchant portfolio market in
  e-commerce and retail
• Consolidating market with diminishing number of
  purchasers of small-to-medium portfolios
• Operating model leverage
• Increased transactional volume and growing
  merchant base improves Pipelines ability to
  effectively negotiate advantageous processing
  contracts
• Proven model to improve portfolio margins after
  acquisition and alleviate attrition
• Highly scalable model

36
Experienced and Vested Management Team

• Experienced and Vested Management Team
• The Companys combined management team has more
  than 150 years of industry experience.
• Management team members average 16 years of
  experience each.
• Managements solid industry underpinnings and
  business know-how is unique in that its breadth
  spans almost every major processor and processing
  system in the credit card industry today.
• Management is deeply vested in the industry as
  evidenced by its combined 50 plus years of
  service on industry association boards and
  committees.

37
Experienced integration execution
38
Investment Highlights

• Emerging Growth Company in Large and Growing
  Market
• Strong and Broad Operating Platform
• Significant Growth Drivers
• Strategic Partnerships
• Stable and Recurring Revenue Base
• Cash-efficient Model
• Strong, Committed Management Team

39
Contact Us

• Pipeline Data Inc.
• (OTCBB PPDA)
• 1515 Hancock Street, Suite 301
• Quincy, MA 02169
• Phone [phone]
• Fax [phone]
• Web site www.pipelinedata.com
• For more information
• ceo_at_pipelinedata.com

40
Management

• MacAllister Smith, President,Chief Executive
  Officer and Director Mr. Smith has served as
  Pipeline Datas president and CEO since March
  2002. He has over fifteen years of experience in
  the merchant processing industry and has held
  ownership positions in three companies that have
  been merged with public corporations. Mr. Smith
  was most recently regional vice president of
  Elavon, formerly Nova Information Systems
  (acquired by U.S. Bank (NYSEUSB)), a
  multi-billion dollar corporation and one of the
  three largest credit card processors in the
  industry. He was president and CEO of Pinnacle
  Financial Technologies, Inc., a nationally
  recognized firm and a pioneer in electronic
  benefits transfer programs. Pinnacle Financial
  Technologies, Inc. merged with Nova Information
  Systems in 1998. Mr. Smith was also co-founder
  and senior partner of AccesServices, Inc.
  (AccesServices). He was part of the team that
  designed and built a nationwide network
  processing switch for retail and online
  MasterCard, Visa, American Express and debit card
  transactions. AccesServices was sold to Digital
  Courier Technologies, Inc. (NASDAQDCTI) in 1999.
• Don Gruneisen, Chief Financial Officer Mr.
  Gruneisen has over 20 years of experience in the
  volatile, high-growth telecommunications
  industry, with expertise in the areas of finance,
  management, accounting and top executive
  corporate management. Mr. Gruneisen holds an MBA
  from Clarkson University in Accounting and
  Management Information Systems and is a Certified
  Public Accountant with twelve years
  experience as a corporate officer (including
  serving in positions of chief executive
  officer/general manager). He has been the
  Treasurer and Director of Finance of NMSI since
  July 2001. From June 2000 to July 2001, Mr.
  Gruneisen was a consultant providing strategic
  guidance with specialization in billing,
  accounting, and tax issues associated with the
  telecommunications industry and financial
  management. From January 1999 to June 2000, he
  was a senior accountant at Whalen, Davey
  Looney, and LLP. From 1977 to 1998, he worked
  for Nicholville Telephone Company, a 3.5 million
  ESOP-owned local exchange carrier/utility. He
  started with the company in 1977 as an accountant
  and accounting manager and ultimately became
  Chief Executive Officer.
• Kevin Smith, Chief Operating Officer Mr. Smith
  has served as Pipeline Datas chief operating
  officer since May 2004, and as the president and
  director of Pipeline Data subsidiary, Pipeline
  Data Processing. He has over 14 years of
  experience in the merchant processing industry.
  Mr. Smith was employed by Concord EFS (acquired
  by First Data (NYSEFDC)) from 1998 to 2004,
  serving as its senior vice president of ISO Sales
  and as COO of Concord Payment Systems, a wholly
  owned subsidiary of Concord EFS. Mr. Smith was
  responsible for the wholesale credit card
  processing division, which included all aspects
  of operations and sales. Prior to that, he served
  as operations director for Bancard Systems.  

41
Management

• Thomas Tesmer, Chief Technology Officer Mr.
  Tesmer has served as Pipeline Datas chief
  technology officer since July 2004. Mr. Tesmer is
  an experienced senior operations executive with
  more than 25 years in the transaction processing
  business. Prior to joining Pipeline, he was the
  president of Symmetrex, Inc., a processing
  company supporting third-party clients that
  operated stored value card programs in the United
  States and foreign markets. Mr. Tesmer was the
  executive vice president of Front End Systems for
  Heartland Payment Systems (NYSE HPY), one the
  nations largest merchant processing companies.
  He served as president and chief executive
  officer of Access Services, Inc.
  (AccesServices), a credit card payment
  processing corporation servicing merchant sales
  agencies and financial institutions nationwide.
  Mr. Tesmer is also the chairman of the board of Q
  Comm International, Inc. (AmexQMM).
• Jack Rubinstein, Chairman Mr. Rubinstein has
  served as Pipeline Datas chairman since the
  Companys inception. He has been the general
  partner of DICA Partners, an investment hedge
  fund, since the commencement of its operations in
  1991. Mr. Rubinstein also acts as a management
  and financial consultant to various public
  companies in the telecommunications industry. He
  was a founding public board member of CD Radio,
  Inc. (Sirius Satellite Radio (NASDAQSIRI)) and
  aided in the funding of the Molloy Group, a help
  desk software developer. Mr. Rubinstein is also a
  founding member of The Capital Advisory Services,
  a consortium of consultants aiding the capital
  market needs of emerging private and smaller
  public companies. Mr. Rubinstein has been a
  securities analyst with Shearson Hammill Co.,
  and was employed at Bear Stearns Co. where he
  was a director, managing the proceeds of
  corporate insider securities sales. Prior to Bear
  Stearns, Mr. Rubinstein joined Morgan Stanley
  Co. where, in addition to serving corporate
  officers and select individual clients, he
  provided his expertise to private investment
  partnerships. Mr. Rubinstein is a graduate of
  Cornell University and received an MBA in Finance
  from New York University.
• James Plappert, Chief Marketing Officer Mr.
  Plappert has served as Pipeline Datas chief
  marketing officer since October 2005. Mr.
  Plappert is a seasoned executive with over 24
  years experience in the payment systems and
  merchant bankcard industry. He has held a number
  of executive level positions in prominent
  companies including National Processing Company
  NPC, PNC Bank and First National Processing
  acquired by iPayment Holdings in 2001. He also
  served as executive vice president MA of First
  American Payment Systems from January 2002 to
  April 2003 culminating in a private equity
  transaction with Lindsay, Goldberg and Bessemer.
  He co-founded ACH Payment Solutions Inc. in 2002
  where he remains a director. Additionally, for
  over eleven years, Mr. Plappert held a number of
  executive level board positions, including
  president, with the Electronic Transaction
  Association (ETA), the leading international
  trade association in the merchant processing
  industry.