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Investor Presentation November 2005

Investor Presentation November 2005. Forward Looking Statements.

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Investor Presentation November 2005

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  1. Investor Presentation November 2005

  2. Forward Looking Statements This presentation may contain forward-looking statements which are subject to a number of risks and uncertainties. These include, but are not limited to, general economic and business conditions; our business strategy for expanding our presence in our industry; anticipated trends in our financial condition and results of operations; the impact of competition and technology change; existing and future regulations effecting our business and other risks and uncertainties discussed under the headings “Risks Related to our Business” in IASG’s Form 10-K for the period ending December 31, 2004 and dated June 13, 2005 as filed with the Securities and Exchange Commission (SEC).

  3. Who We Are What We Do Our Industry How We Grow Financial Metrics Investment Opportunity Agenda

  4. Company Overview • Specialty Financing Company Serving Independent Alarm Dealers • Own approximately 162,000 Retail Alarm Contract Equivalents • Generate $4.9 million RMR • Industry Leading Alarm Servicing Business • Largest Wholesale Monitoring Company in the U.S. • Currently Monitor approximately 690,000 Alarm Contracts for Dealers • Generate $2.9 million RMR

  5. Company Overview(cont.) • 5,000 Dealer Relationships • Own a $21.8 million dealer loan portfolio • Over 842 Employees with Headquarters in Albany, NY • National Presence • Three Alarm Monitoring Centers • Three Dealer and Customer Care Centers

  6. Experienced Team Management Team has Over 80 Years of Industry Experience • Timothy M. McGinn (13 years of services) – Chairman and CEO • Thomas J. Few, Sr. (36) – Vice-Chairman and President • Bruce Quay – Chief Operating Officer • Michael Moscinski (26) – Chief Financial Officer • Brian E. Shea (12) – Executive Vice President, Portfolio Acquisitions • Robert B. Heintz (8) – Executive Vice President, Alarm Monitoring Experienced, Independent Board of Directors

  7. Approx. 10,000+ Independent Dealers $3.8 B 56% Market Share TARGET MARKET Protection One $256 M Brinks Home Security $253 M Honeywell Security Products $120 M 2004 U.S. Security Industry Overview • Total Market $25 Billion • Approximately $7.5 Billion Related to Residential Alarm Sales and Installation • Approximately $7.5 Billion Related to Commercial Sales and Installation • $4.7 Billion from Security System Monitoring and Leasing ADT Security Services $2.3 B ADT Security Services $2.3 B ADT Security Services $2.3 B Source: The Freedonia Group SDM Magazine

  8. 22.0%Penetration 20.0%Penetration 18.0%Penetration 13.5%Penetration 9.5% Penetration Millions U.S. Security Industry Overview - Residential Millions $4.05 billion Source: The Freedonia Group

  9. Dealer Needs Wholesale Operations Monitoring and Servicing Administrative Support Services • IASG Provides an Integrated Solution to Independent Alarm Dealers • State-of-the-art Facilities • Emergency Dispatch • Two-way Voice RetailOperations • Billing • Collection • Equipment Discounts • Branded Programs • Purchase Contracts • Lend Against Contracts

  10. Monitoring Services Business The Industry Leader in Outsourced Alarm Monitoring Services • Relationships with 5,000 Independent Alarm Dealers • Currently Monitor Approximately 690,000 Subscribers • Generating $2.9 million of RMR • Technical Competence • Three UL Listed Monitoring Stations • California • Minnesota • New Jersey • Growth Capacity • Economics of Scale • Customer Service • Three Regional Dealer Care Centers • Licensed in 50 States and over 250 Political Subdivisions

  11. Specialty Finance Business • Purchase or Finance Retail Alarm Monitoring Contracts • Own approximately 162,000 Contract Equivalents- generating approximately $4.9 million of recurring monthly revenue (RMR) • $29.40 Average RMR per account • Target Rich Contract Acquisition Environment with Considerable Activity • Leverage Target of 1.5:1 Debt to Equity • IPO Equity Plus Prudent Leverage Engine for Growth • Current net Debt to Equity ratio 0.96:1

  12. Finance Business - Acquisition Standards • Dealer Relationships Unique Advantage • Sane Purchase Multiples of Recurring Monthly Revenue • Require First Year RMR Guarantee From Dealer • 10% Purchase Price Holdback • Require Dealer Finance Customers to Move All Monitoring Business • Strict Underwriting Standards

  13. Moves • Contract Non-Renewal • Affordability Controllable Attrition • Service Issues • System • Monitoring Uncontrollable Attrition Specialty Finance Business - Contract Attrition The Key Profitability Driver • Attrition Management • Control Subscriber Touchpoints • Service is Largest Component of Controllable Attrition

  14. Consolidated Balance Sheet

  15. Investment Considerations • High Margin, Recurring Revenue Business Model • Strong Cash Flow • Compelling Opportunity in the Security Alarm Industry • Significant Growth through Accretive Acquisitions of Retail Portfolios • Disciplined Acquisition Strategy • Strong Balance Sheet • Excellent Liquidity • Efficient Servicing Platform

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