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Numerex NASDAQ: NMRX Global M2M Managed Services Provider

Numerex NASDAQ: NMRX Global M2M Managed Services Provider. Sidoti Micro-Cap Conference New York, NY January 9, 2012.

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Numerex NASDAQ: NMRX Global M2M Managed Services Provider

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  1. NumerexNASDAQ: NMRXGlobal M2M Managed Services Provider Sidoti Micro-Cap Conference New York, NY January 9, 2012 © 2012 Numerex Corp. All rights reserved. Numerex, the Numerex logo and all other Numerex marks contained herein are trademarks of Numerex Corp. and/or Numerex-affiliated companies. All other marks contained herein are the property of their respective owners.

  2. Safe Harbor Statement This presentation contains forward looking statements, including future projections, descriptions of Management's plans and objectives for future operations, statements of future economic performance and statements concerning the assumptions underlying and relating to these projections, plans, objectives and future performance. The following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: our inability to reposition our platform to capture greater recurring service revenues; the risks that a substantial portion of our revenues are derived from government contracts that may be terminated by the government at any time; variations in quarterly operating results; delays in the development, introduction, integration and marketing of new wireless services; customer acceptance of services; economic conditions resulting in decreased demand for our products and services; the risk that our strategic alliances and partnerships will not yield substantial revenues; changes in financial and capital markets, and the inability to raise growth capital; the inability to attain revenue and earnings growth in our data business; changes in interest rates; inflation; the introduction, withdrawal, success and timing of business initiatives and strategies; competitive conditions; the inability to realize revenue enhancements; and extent and timing of technological changes. Numerex SEC reports identify additional factors that can affect forward-looking statements. 2 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  3. M2M is using a device … … … … … … sensor, meter, etc. level, location, status, etc. to capture an event … … … … … … … that is relayed through a network … wireless, wired or hybrid software program to an application … … … … … … … … which translates the captured data into meaningful, actionableinformation … … … “there is a breach”“tank level is low”“measurements are out of normal range” “lost vehicle is located”“vending machine needs to be restocked” ... etc. What is M2M? 3 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  4. M2Mmaybe found everywhere Residential Security Automatic Meter Reading • M2M is called many things… Pervasive Internet, Internet of Things, Telematics, Telehealth, Telemetry, Connected Life, Smart Device, Smarter Planet (IBM), etc. Pipeline Monitoring Telehealth ATMs/Surveillance In-vehicle Emergency Services 4 Vending Fleet Management

  5. M2M Market “Analysys Mason forecasts that the number of M2M device connections will grow from 62 million* in 2010 to 2.1 billion devices in 2020”. *Commercial segment accounts for well over half of today’s M2M deployments Numerex’s Market Gartner expects the M2M cellular module business for ENTERPRISE APPLICATIONS to grow at a CAGR of 16.3% from 2009 levels, with tracking, remote monitoring and security remaining as the 3 largest applications. (Source: Morgan Keegan) Commercial and consumer M2M device connections by industry sector, worldwide, 2020 Source: “Imagine a world with 2.1 billion connected things…” Analysys Mason Insight, January 27, 2011 5 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  6. Who is Numerex? • Publicly traded on NASDAQ: NMRX • Unique repository of M2M experience, know-how and intellectual property • Top enterprise (B2B) service provider with over 1.4 million M2M subscriptions • Industry standard trend-setter with first M2M North American ISO 27001 (information security) certification • (Numerex CTO) chairs the Global Standards Collaboration M2M Standardization Task Force (International Telecommunication Union) • M2M networks supporting global cellular and satellite solutions Unique Repository ofM2M Experience, Know-how, and Intellectual Property 6 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  7. Major organizations using Numerex services include: CABLE TV MSOs 7 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  8. Streamlining the complexity - Numerex DNA® Network GSM/GPRS Network Offerings Optimization & Configuration Bundled & Pre-Paid Programs Device Embedded & Finished Solutions Modem and Sensor Coupling Firmware Design & Optimization Planning & Certification Support Provisioning / Logistics Application Numerex Open Architecture Numerex FAST® Professional Services We are the 3rd party M2M Experts. While it typically takes multiple vendors to develop a solution for an individual customer, Numerex uniquely provides these services as a single source and takes responsibility for the timely development, commercialization, and operation of a customer solution. 8 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  9. Examples of Numerex’s approach to market M2M Business Solutions M2M Distributed Products • We sell pre-packaged M2M products and solutions to a variety of customers such as: • Security monitoring & installation companies • Disaster relief agencies & emergency services providers • Government contractors with asset tracking responsibilities • Automobile insurance companies • Fleet Management • Supply Chain & Logistics • We assist clients in the development of their own solution: • Single source provider of all M2M components • “DNA” integration via an easy-to-use process • Customizable and scalable • Rapid development and deployment • Selling through, to and with: • Fortune 1000 companies • Wireless Carriers • Strategic Partners 9 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  10. Numerex’s Technology Advantage Numerex offers a broad cloud-based M2M horizontal platform (Numerex FAST®), which is an M2M solution foundation that can be accessed through three service delivery options, separately or combined: Network-as-a-Service (NaaS); Platform-as-a-Service (PaaS) and Software-as-a-Service (SaaS). 10 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  11. Numerex’s Technology Architecture Customer Portal (Subscription & Device Mgmt) CDMA Device CDMA Security Alerts NaaS GSM Device PaaS/SaaS GSM Database & Business Analytics IP Dispatch Center Next Gen B-Band System Application Portal 11 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  12. What makes Numerex different? • Simplify and provide one single point of contact for the whole M2M value chain • Focus our resources ongenerating long-term recurring high-margin service revenues 12 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  13. Data Security & Privacy is in our DNA AT&T EDS Federal Reserve Microsoft Salesforce.com SAP United Nations Verizon World Bank Xerox etc. ISO 27001–certified Organizations in the US • ISO/IEC 27001: 2005 information security certified (“ISO 27001”) • 11 Security Domains • 33 Control Objectives • 133 Security Controls • ISO 27001 facilitates compliance with: • HIPAA requirements • FERC/ NERC Security Mandates • Other security laws/regulations • Sarbanes-Oxley Compliant 13 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  14. Driving global M2M standardization • Numerex’s CEO is a member of the Telecommunications Industry Association’s (TIA) Board of Directors • Numerex’s CTO chaired TIA ’s Smart Device Communications Committee for the 2010-12 term during which a new Smart Device Communications Reference Architecture standardwas released • Numerex’s CTO chairs the M2M Standardization Task Force (MSTF) of the Global Standards Collaboration* (GSC) • Numerex recently organized international conferences on M2M standards with preeminent standard groups and forums (May and September 2011) * GSC is a group of major standards development organizations centered on the International Telecommunication Union (ITU), a specialized agency of the United Nations 14 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  15. Working hand-in-hand with our customers Discover & Define Design & Develop Deploy & Defend Phase 1 - Solution Inception Working sessions & requirements for device, network, application – as well as data integration into existing legacy systems Phase 2 – Solution Building Build a small number of working prototypes of the complete end-to-end solution. Also develop a detailed ROI model that quantifies the benefits. Phase 3 – Commercialization Implement early stage deployment, validating the ROI model in real market conditions with sufficient scale for valid results while limiting out-of-pocket expenses. 15 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  16. Solution example: tank level monitoring We can remotely and instantly monitor tanks almost anywhere in the world via cellular or satellite… Web-Based Application Know exactly how full or empty they are and when they need service. Remote Asset Monitoring Device Wireless Network + + = Cutting operating costs and improving customer satisfaction! 16 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  17. Why Do Customers Choose Numerex? History in the M2M Industry Data and Access Security Emphasis Ease of Doing Business & Customer-Centered Core Values Efficiency, Reliability and Speed of Delivery Worldwide Footprint Single Source for DNA-Enabled M2M Solutions 17 © 2011 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  18. Numerex Financial Performance 18 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  19. Compound Annual Growth Rates – Key Metrics • Subscriptions 25% CAGR • Recurring Revenue 15% CAGR • Non-GAAP EBITDA 25% CAGR The Company’s compound annual growth rate (CAGR) in subscriptions from January 2008 through end of September 2011 was 25%, generating a 15% CAGR in recurring revenue. This growth in subscriptions and resulting growth in recurring revenue drove non-GAAP EBITDA CAGR of 25% over that same period. 19 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  20. Subscription Growth 20 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  21. M2M Recurring Revenue 21 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  22. Adjusted EBITDA* * * Adjusted for litigation settlement and stock option expenses 22 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  23. Balance Sheet 23 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  24. Capital Structure 1 24 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

  25. Key Takeaways • Pure play on fast-expanding M2M market • Rapidly growing subscription base • High margin recurring revenue • Positive cash flow (operations and adjusted EBITDA) • Significant operating leverage • Strong capital structure Numerex powers its customers to success 25 © 2012 Numerex Corp. Proprietary & Confidential. All Rights Reserved.

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