NYSE Market: DSS Corporate Overview January 2019 www.dsssecure.com
Forward-Looking Statements NYSE American: DSS Forward-looking statements that may be contained in this presentation, including, without limitation, statements related to the Company’s plans, strategies, objectives, expectations, potential value, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act and contain words such as “believes,” “anticipates,” “expects,” “plans,” “intends” and similar words and phrases. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the results projected in any forward-looking statement. In addition to the factors specifically noted in the forward-looking statements, other important factors, risks and uncertainties that could result in those differences include, but are not limited to, those disclosed in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, filed with the Securities and Exchange Commission on March 6, 2018. Forward-looking statements that may be contained in this presentation are being made as of the date of its release, and the Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements.
Counterfeit Products - a Global Epidemic NYSE American: DSS 10% of Global GNP is counterfeit goods 1 ▪ Counterfeiters will produce $1.7 trillion in fake products worldwide in 2017 2 ▪ The total global Anti-Counterfeiting Packaging Market is projected to grow from $107.26 billion to ▪ $206.57 billion by 2021 3 Faking It A look at the composition of counterfeits coming onto the U.S. that are seized by authorities 4 Where do they come from? What are most common Total number of seizures fakes seized (FY2014)? Others 30,000 11% 11% Watches/ 375 million 25,000 Jewelry Canada 20,000 Handbags/ 342 1% Wallets 15,000 Consumer FY2014 162 Electronics/parts 10,000 Total Wearing apparel/ 114 1.2 Billion 5,000 accessories Pharmaceuticals/ 73 0 Hong Kong personal care 25% China 50 Footwear 63% Sources: 1) U.S. Chamber of Commerce, 2) The Counterfeit Report.com, 3) Includes coding & printing, RFID, hologram, security labels, packaging design, digital mass sterilization/encryption, and surveillance technologies, MarketsandMarkets.com, January 2017. 4) Wall Street Journal and U.S. Homeland Security. “Seized values” based on MSRP of the seized goods, had they been real
If You Can Make It, They Can Fake It - a Consumer Crisis NYSE American: DSS “Warning Over Fake Lipstick “ Fatal Elephant “Fake Prescription “Deadly Fake Viagra: Sold on eBay and Facebook Drugs Causing Tranquilizer Found In Online Pharmacies That Could Trigger Serious Overdose Deaths in Counterfeit Painkiller Suspected of Selling Heart Problems – and Harm Portland Area” Pills ” Counterfeit Drugs” Your Unborn Baby ” “Fake Chinese Electronics “Warning After “ Fake Alcohol Laced “Counterfeiting of food Threaten U.S. Defense, Hundreds of Counterfeit with Glue, Anti- products results in health Failures Would Prove Mobile Phones with Freeze Causing hazards and even death. Key Catastrophic for Soldiers, Hazardous Chargers are Blindness & Death ” food items such as baby milk Airmen” Seized” powder and fake medicines have been the cause of thousands of deaths since 2014” Apple: Nearly 90% Of 'Genuine' iPhone Chargers On Amazon Are Counterfeit
Anti-Counterfeiting & Brand Protection Expertise NYSE American: DSS Established in 1995, Document Security Systems, Inc. protects brands, consumers, and governments from the harm caused by counterfeiting, diversion, and fraud. Counterfeiting is big business, and nothing is safe. Whether you want to protect products, official documents, IDs, books, or other important assets, DSS offers a powerful new generation of technology solutions to thwart fraud. With more than $1.7 trillion in losses a year from counterfeiting, our solutions make it more difficult to create counterfeits while simultaneous making it easier to authenticate the real item. We work with governments, multi-national corporations, growing businesses, and organizations around the world that need to protect their customers, their products and their brand reputation. DSS assists with layered strategies to defeat attempts at fraud. Our products are organized around two core concepts. First , make it more difficult to create counterfeits by interfering with reproduction. Second , make it easier to identify genuine articles through strong authentication technologies. Our products don’t require changes in production or the implementation of new machinery, instead, we leverage existing capabilities for some of the most effective security solutions on the market. Regardless of the scope, our authentication solutions combine advance printing technology with cutting edge digital innovation, helping you protect your products, documents, web sites, and other important assets.
DSS Revenue Channels NYSE American: DSS IP Licensing & Monetization Secured/Printed Digital Solutions Products Enable Personnel & Consumers Manufacture Develop, Acquire & License Technology To Easily Authenticate Products Secure Printed Products ▪ ▪ Expand market reach of Deliver custom security ▪ Next – generation smartphone technologies printing, packaging and ID brand protection solution card products to end-user ▪ Creates partners to enhance ▪ Integrates print security, customers capabilities for customers mobility, & data capture ▪ ▪ Supports licensing business Enter new markets technologies ▪ SaaS licensing model
Digital Solutions - AuthentiGuard ™ NYSE American: DSS ❶ Digital Solutions ❷ Secured/Printed Products ❸ IP Licensing and Monetization AuthentiGuard ™ Competitive Advantages ▪ Authenticates packaging and printed material Secure marking technology utilizes ◼ through iOS/Android smartphone application standard printing process ▪ Targets the global Brand Protection Market Embedded code is protected with DSS ◼ PRISM ™ technology estimated to reach $3.8 billion in 2018 1 ▪ Protection for consumer products, food & Patented technology is resistant to ◼ beverage, parts & industrial components, copying, scanning and high resolution pharmaceuticals, health & personal care photography ▪ Mobile authentication tool, provides Provides a direct connection to consumers ◼ consumers and entire supply chain personnel through mobile application, integration of with the ability to authenticate on-site Augmented Reality technologies ▪ Generates large amounts of data on consumer Our solutions do not require installation of ◼ habits, as well as security breaches in the field additional equipment or modification of any manufacturing processes 1) Source: Smithers Pira For more information: www.authentiguard.com
Digital Solutions - AuthentiGuard ™ NYSE American: DSS ❶ Digital Solutions ❷ Secured/Printed Products ❸ IP Licensing and Monetization AuthentiGuard ™ 52 Start-ups are our competitors Most are: Our Competitors - Venture-backed with limited history - Poor technology - No marquee accounts DSS has: - Long operating history Our Advantages - Very strong technology - Revenue & global account
Digital Solutions - AuthentiGuard ™ NYSE American: DSS ❶ Digital Solutions ❷ Secured/Printed Products ❸ IP Licensing and Monetization The AuthentiGuard solution is comprised of three key components that work together to secure products The Application The Database The Mark
The AuthentiGuard ™ System: Mark NYSE American: DSS DSS Security Mark Features ◼ Embedded code is protected with PRISM ™ technology ◼ Technology resists counterfeiting on copiers and scanners ◼ AuthentiGuard ™ Mark is applied to surface during the printing process ◼ Can be produced using a variety of printing processes including: Offset, Flexo and Digital, as well as Laser ◼ Mark is embedded into the artwork during pre-press printing stage ◼ Once the AuthentiGuard ™ Mark is scanned, encrypted information becomes available to the user through smartphone application ◼ The Mark holds various amount of information i.e.: origin, destination, expiration, serial number + more ◼ Customizable in shape, size and location
The AuthentiGuard ™ System: App NYSE American: DSS Key Features : Two-factor authentication ▪ App distribution and control ▪ Secure tie-in to serialization and codes ▪ History of valid/invalid scans ▪ Photo evidence capabilities ▪ GPS locator ▪ Result distribution (SMS/Email/etc…) ▪ Simultaneously authenticate and read ▪ alphanumeric, linear and 2D codes Fully customizable features, look and feel ▪
Authentication in Action NYSE American: DSS ❸ IP Licensing and Monetization ❶ Digital Solutions ❷ Secured/Printed Products
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