Introduction to IDSS and the DETECT 1000 Advanced

Introduction to IDSS and the DETECT™ 1000 Advanced Checkpoint Scanner and Related Products March 2018 IDSS – Transforming Today’s Security! IDSS Holdings, Inc. 430 Bedford Rd, Ste. 204 Armonk, NY 10504 +1 -914 -273 -4000 Company Proprietary For Official Use Only (FOUO)

IDSS DETECT™ 1000 3 -D Image of Explosive in Boot Note: Clarity and Isolation of Plastic Explosive Threat in Boot Note: Salt Shaker Hole Clarity IDSS Confidential Information – For Official Use Only (FOUO) 2

IDSS Key Personnel – How We Will Achieve Our Vision Joseph Paresi Chairman and CEO Peter Marino Board Member Peter Neffenger Planned Consultant Bernard Gordon Board Member Paul Efron Board Member Ron Zampolin CFO Jeff Hamel President Rich Nelson Jim Connelly, Ph. D Omar Al Kofahi, Ph. D Director Algorithms VP International CTO Patricia Krall Ed Olin Director Programs Executive VP John Halinski Daniel Poder Barbara Zylinski Operational SW Marketing Support Senior Advisor Our Reputation is Exceptional and Numerous Industry Experts and Representatives Have Asked to Join the IDSS Team IDSS Confidential Information – For Official Use Only (FOUO) Paul Medwar VP Finance 3

Advanced Security Systems – Experience of the IDSS Team! Joseph Paresi – CEO IDSS Former President, L-3 Security & Detection Systems and Co-Founder L-1 Identity Solutions Pro. Vision MMW Body Scanner Bernard Gordon Chairman PDSI Retired Founder Chairman and CEO Analogic Corporation e. Xaminer 3 DX™ 6000 Douglas Boyd CEO TSS Former Chairman, Imatron and In. Vision Technologies In. Vision CTX 9000 X-ray Checkpoint Scanners Multi-Biometrics In. Vision CTX 6000 Cargo Scanners The IDSS Team is Responsible for Developing >90% Deployed Explosive Detection and Advanced Imaging Systems Worldwide! IDSS Confidential Information – For Official Use Only (FOUO) 4

The DETECT™ 1000 Ø Threat Detection Ø Ø Ø The Best, Fully Automated Threat Detection (per TSA) Lowest False Alarms of ANY System Ever Tested (per TSA) Patented Dual Energy CT – Required for Advanced Threats Ø Best Image Quality of Any Explosive Detection System Ø Submillimeter Resolution – Required for Certain Types of Threats Ø Throughput Speed (Operate either Stand-Alone or Integrated with ASL) Ø Operational Throughput of over 550 Images Per Hour Ø Yielding Higher Passenger per Hour Throughput Ø High Reliability and Low Life Cycle Cost Ø Designed for 15 Years of Operational Use The DETECT™ 1000 Dual Energy CT Is Considered the “Gold Standard” for Checkpoint Security and is the Only System in the TSA Production Process IDSS Confidential Information – For Official Use Only (FOUO) 5

DETECT™ 1000 Internal View of Subsystems Integrated High Voltage Power Supply and X-Ray Tube Assembly Slip Ring and Data Link Mounted on Highly Reliable Gantry with 96 Year Useful Life COTS Computer and Conveyors Integrated Patent. Pending Dual Energy Detector Assembly A Simple, Easy to Build and Maintain Hardware Design The DETECT™ 1000 CT Rotates the X-ray Around the Bag and Captures Full 3 D Images in Seconds using Advanced Image Processing IDSS Confidential Information – For Official Use Only (FOUO) 6

Key Threats Driving DETECT™ 1000 Deployments Ø Terrorist Have Learned to Exploit Weaknesses of X-ray Scanners Ø Bomb Makers are Using Hard to Detect Non-Metallic Detonators Ø Ø A Key Way to Visually Analyze and Confirm IED in Colored Image Ø Explosives Hidden in Electronics are a Serious Challenge to X-ray Scanners Ø Home Made Explosives (HMEs) Further Complicate the Detection Process Congress and TSA Agree Existing X-ray Scanners Cannot Detect Threats Effectively, as Proven through Undercover Testing Ø Undercover Staff Successfully Evaded Security 96% of Tries (June 2015) Ø Retraining of Officers Showed Little Improvement (Technology Limitation) Undercover Staff Again Successfully Evaded Security >80% of Tries (June 2017) Ø Ø Electronics Ban Emphasizes Seriousness of the Present Threat Ø TSA Now Pushing to Fix with Immediate CT-System Deployments The DETECT™ 1000 Solves These Problems and Formal Test Results Have Validated Its Exceptional Performance IDSS Confidential Information – For Official Use Only (FOUO) 7

New Terrorists Threats Are of Serious Concern to U. S. Officials Ø Ø DHS Knows Today’s Threats are Concerning and Imminent Ø TSA Administrator Pekoske: “The Threat to Aviation Security is Worse than Ever” Ø DHS Intelligence Suggests: “Terrorists are Plotting Another Massive Strike” Ø New Security Directive: “All Electronic Devices Larger than Cell Phone Must be Removed” Congressional Chairman Rep. Mike Mc. Caul urging TSA: Ø Ø “Deploy CT scanners as quickly as possible to all U. S. airports and the 10 airports considered the highest threats that send flights to the U. S. ” Homeland Security Committee Member, Rep. Bennie Thompson stated: Ø "Following the hearing, I remain convinced that DHS must act — without delay — to acquire and deploy updated screening technology, including Computed Tomography, at our nation’s airports, " "Such technology has proven more effective at detecting threats than existing systems and is currently deployed successfully elsewhere in the world. " IDSS Confidential Information – For Official Use Only (FOUO) 8

Recent Attempts on Aviation Security Ø Daallo Air 159 Somalia Suicide Bomber Ø Explosive Hidden in DVD Compartment of Laptop Ø Ø Ø Second IED Captured and Exploded for Safety Second One Found, Detonated for Safety Ø Flight Delayed but IED was on a Timer Ø Exploded at 14, 000 ft. before Aircraft was Pressurized Etihad Air Flight from Sydney to UAE Ø Explosives in Meat Grinder (Like a Pipe Bomb) Ø Intercepted ONLY Because the Bag was Overweight! Daallo Air 159 Explosion Terrorist Disorganization, Not Security, Has Protected Travelers IDSS Confidential Information – For Official Use Only (FOUO) 9

Daallo Air 159 Captured with IED Unseen in X-Ray vs. DETECT CT X-ray View CT View Location of Explosive The DETECT™ Automatically Highlights All Threats 10 Unclassified IDSS Confidential Information – For Official Use Only (FOUO)

Thin Sheet Explosives Deployed X-ray vs DETECT™ 1000 How can a Security Officer Find a Bomb in this Laptop? Easily Automatically Detected by the DETECT™ 1000 Location of Thin Sheet Explosive Key IED Concealment Al Qaeda is Exploiting Imaged by Leading TSA AT 2 X-Ray Scanner IDSS Confidential Information – For Official Use Only (FOUO) 11

Weapons are Hard to Find Using 2 D Projection X-rays Switchblade In 2016, 2, 300 Guns were Captured at TSA Checkpoints Opinel #4 Pocket Knife IDSS Confidential Information – For Official Use Only (FOUO) Unclassified 12

Weapons are Easy to Find Using DETECT™ High Resolution Switchblade Opinel #4 Pocket Knife Testing by Both Heathrow/Manchester and Schiphol Airports Independently Obtained a 98. 5% Operator Accuracy in Detecting Restricted Items! IDSS Confidential Information – For Official Use Only (FOUO) Unclassified 13

High Resolution Simplifies Review of Even a Plastic Toy Gun Only DETECT’s Higher Photon Energy, High Signal to Noise Ratio and High Resolution Results in Unprecedented Images of Very Hard to Find Restricted Items IDSS Confidential Information – For Official Use Only (FOUO) Unclassified 14

DETECT™ 1000 Deployed and Operated by TSA at Boston’s Logan International Terminal IDSS Confidential Information – For Official Use Only (FOUO) 15

DETECT™ at Amsterdam Schiphol Airport with Scarabee Tray Return System Schiphol Airport Installation – Input Side Schiphol, Exit and Diverter IDSS Confidential Information – For Official Use Only (FOUO) 16

DETECT™ at Singapore Changi Airport In Stand-Alone Operation Customer Stated, “Images are Superior to Any Competitors”. Phase II Operational Evaluation for Gate Pre-Board Screening IDSS Confidential Information – For Official Use Only (FOUO) 17

IDSS DETECT™ 1000 – Fixing the Checkpoint Problem DETECT™ 1000 Will Eliminate > 23% of Checkpoint Delays while Reducing Queue Times Significantly! Source: IATA Reduced by Less Divestitures C 2 & APSS Level 1 Certified C 3 & APSS Level II Certified Ø Better Throughput with Significantly Improved Security Ø Fully Automated Detection = Better Security and Happier Passengers Ø Low False Alarms = Less Bag Searches = Faster Throughput and Happier Passengers IDSS Confidential Information – For Official Use Only (FOUO)

Present Efforts with TSA and DHS Science & Technology (WIP) DHS/TSA Funded Contracts ($13 M plus Options) Ø “Current” Threats and System Purchases Ø Advanced Threat Detection Algorithms Laptop Specific Threat Detection Algorithms Automated Weapons Detection CT Architecture Specifications with Sandia National Labs Deep Learning Algorithm with Lawrence Livermore & Cascade APSS Iterative Certification (Plus Options of $4. 4 M and $2. 5 M) Ø Ø Ø Ø Checked Baggage Technology Program (Plus Option of $5. 5 M) Cargo Pallet CT Scanner Program (Plus Option of $7. 5 M in GFY 19) IDSS is Supporting TSA and DHS S&T with CT Capabilities Across All Key Security – Checkpoints, Checked Baggage and Cargo IDSS Confidential Information – For Official Use Only (FOUO) 19

Automated Weapons Detection (WIP) Slice View Alarm View DHS Funded Contract to Automate Weapons Detection – Available Late 2018 IDSS Confidential Information – For Official Use Only (FOUO) Unclassified 20

Installation, Training and Maintenance Support – our approach Ø System Installation Ø Ø Operator Training Ø IDSS Provides an Emulator for Classroom Training with Stored Images Ø Local Language Translations and Training Multiplexed Image Transfers Ø Multi-Operator Image Review Ø Remote Screening IDSS Partners for Support Maintenance Ø Ø IDSS Works with the Customer on Operational Installations Plans IDSS Provides Maintenance Training, Support and Spare Parts Performance and Maintenance Ø IDSS Provides Software Upgrades as Detection List is Expanded Ø System Operational Data is Stored and Available on TCP/IPv 4 Network Ø DETECT™ Has Built-in Self Check and Fault Identification Ø Spare Parts are Stored Locally for High System Availability IDSS Confidential Information – For Official Use Only (FOUO) 21

DETECT™ 1000 Where You Can See the Systems Ø Amsterdam Schiphol Airport Ø Boston Logan Airport International Terminal Ø Singapore Changi Airport Ø Budapest Airport in 2018 Ø Tokyo Narita Airport in 2018 Ø United Kingdom in 2018 Ø New TSA Sites Being Prepared IDSS Confidential Information – For Official Use Only (FOUO) 22

Summary and Conclusion Ø Ø Ø TSA and ECAC Next Generation Technology Is Computer Tomography(CT) Ø Impossible to Solve Today’s Threat Requirements with Existing X-Ray Technology Ø IDSS DETECT™ is in TSA Procurement Process for 2018 Deployments Ø ECAC C 2 (& soon C 3) Certification has global acceptance The IDSS DETECT™ Has Proven, Best Detection and Images Available Ø Best Test Performance in TSA and EU Testing Ø High Quality Images Make it Easy for Operator Use Ø Narcotics Detection IDSS DETECT™ 1000 Has Significant U. S. Government Contracts Ø $13 M in new DHS/TSA Funded Contracts Ø U. S. Secret Service and U. S. CBP Deploying DETECT™ 1000 s IDSS Confidential Information – For Official Use Only (FOUO) 23

IDSS Engineering and Production Facility Visit us on the web at: www. idsscorp. net New 20, 000+ sq. ft. Engineering and Production Area (expandable) IDSS Proprietary – For Official Use Only (FOUO) 24

Thank You for your Interest and Consideration! Richard Nelson RNelson@idsscorp. net Jeffrey Hamel JHamel@idsscorp. net IDSS Holdings, Inc. 430 Bedford Rd, Ste. 204 Armonk, NY 10504 +1 -914 -273 -4000 Company Proprietary For Official Use Only (FOUO)