William Roof – Chief Executive Officer. Bill White – Chief Financial Officer

Tom Mcguire – Private Investor Jack Morbeck – First Washington Corp

Good day and welcome everyone. Thank you for joining us today for the 2015 Third Quarter Conference Call to discuss Intellicheck Mobilisa’s results for the fiscal quarter ending September 30, 2015. My name is Mellissa and I will be your operator today. In moment I will call upon Intellicheck’s CEO Dr. Bill Roof who will lead today’s call and introduce the members of the Intellicheck Mobilisa’s management team who will be participating in today’s conference call. Following the management’s prepared remarks we will open the call up for questions. Before I turn the call over to management, I would take a few minutes to read the forward-looking statement. Certain statements in this conference call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. When used in this conference call, words such as will, believe, expect, anticipate, encourage and similar expressions as they relate to the Company or its management, as well as assumptions made by and information currently available to the Company's management, identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and beliefs about future events. As with any projection or forecast, they are inherently susceptible to uncertainty and changes in circumstances, and the Company undertakes no obligation to and expressly disclaims any obligation to update or alter its forward-looking statements whether as a result of such changes, new information, subsequent events or otherwise. Additional information concerning forward-looking statements is contained under the heading of Risk Factors listed from time to time in the Company's filings within the Securities and Exchange Commission. Management will use the financial term adjusted EBITDA in today’s call. Please refer to the Company’s press release issued this morning for further definition of in context for use of this term. I would now like to turn the call over to Dr. Bill Roof, Intellicheck Mobilisa's Chief Executive Officer. Dr. Roof.

Good day and welcome to the Intellicheck Mobilisa Q3 2015 earnings call. Today we will present corporate earnings information for the quarter ending September 30, 2015. After our prepared remarks, we will answer questions from shareholders. Our Chief Financial Officer, Bill White will now review the Q3 2015 financial results. Bill?

Thank you, Bill and a good day to our shareholders, guests and listeners. I’d like to discuss some of the financial information that was contained in our press release for the third quarter ending September 30, 2015 which we released this morning. We anticipate that our quarterly report on Form 10-Q will be filed with the SEC this afternoon. Revenues for the third quarter ending September 30, 2015 decreased 31.7% to $2.199 million compared to $3.218 million in the same period of the previous year. During the quarter, the Company sold its non-core wireless assets that accounted for $24,000 of third quarter revenue versus $741,000 in the same period last year. Excluding the revenue generated from the wireless division from both periods, sales were down approximately 12% for the third quarter. Identity System revenues during the quarter were driven by sales in the banking and telecom markets that was more than offset by a decline in government bookings. The Company’s booked orders for the three months ending September 30, 2015 decreased 34% to $2.036 million compared to $3.079 million for the same period in 2014. Excluding the $418,000 in wireless bookings from the prior year, the Company’s booked orders were down 24% for the third quarter. Gross profit was $1.396 million for the quarter compared to $2.016 million for the same quarter last year. Although our gross profit dollars decreased due to the lower sales year-over-year our gross margin improved 90 basis points to 63.5% of revenues versus 62.6% of revenues in the third quarter of 2014. The gross margin improvement was driven by higher margins on Defense ID sales. Operating expenses, which consists of selling, G&A and research and development expenses increased 64% to $2.775 million for the three months ending September 30, 2015 from $1.688 million for the three months ending September 30, 2014. Selling expenses increased $84,000 primarily driven by additional sales people. G&A expenses increased $764,000 principally as a result of an amortization of cost of the non-compete agreement with former CEO of the company and higher cost related to stock-based compensation and an increase in professional fees. Research and development cost increased by $239,000 driven by the continued development of our SaaS product platform. Adjusted EBITDA for the quarter ending September 30, 2015 was a negative $734,000 compared to a positive $444,000 to the third quarter ending 2014. The company posted a net loss with $1.368 million or $0.13 per diluted share for the three months ending September 30, 2015 compared to a net gain of $328,000 or $0.07 per diluted share for the quarter ending September 30, 2014. As of September 30, 2015, our backlog, which represents non-cancelable sales orders for products not yet shipped and services to be performed increased 26% to approximately $898,000 compared to $710,000 at September 30, 2014. It also increased 69% versus December 31, 2014 number when our backlog was approximately $530,000. Interest and other income was $112,000 for the quarter primarily attributable to the sales of the wireless division during the quarter. On August 31, 2015, the Company sold wireless enterprise assets to the Jamestown S'Klallam Tribe for a total consideration of $350,000. The sale consisted of an upfront cash payment of $30,000, the issuance of a promissory note totaling $200,000 and contingent consideration upto a maximum of $120,000 on future earnings. The Company recognized the gain on the sale of approximately $109,000. Total assets disclosed included certain trade names associated with the wireless assets with a net book value of approximately $65,000 and certain fixed assets with a net book value of approximately $56,000. Any gain on contingent consideration will be recognized as earned. I’d like to now focus on the Company’s liquidity and capital resources. As of September 30, 2015 the Company had cash and cash equivalents of approximately $6.7 million, working capital of $6.8 million, total assets of $19.9 million and stockholders’ equity of $17.7 million. During the nine months ending September 30, 2015, the Company generated net cash of approximately $3.699 million compared to $2.843 million for the nine months ending September 30, 2014. Cash used by operating activities was $3.745 million in 2015 compared to a use of $2.309 million in 2014. Net cash used in investing activities was $156,642 in 2015 compared to $95,753 in 2014. We generated net cash of $7.661 million for financing activities in 2015 compared to $5.247 million in 2014. On October 5, 2015, the Company entered into a two year revolving facility with Silicon Valley Bank secured by collateral accounts. The maximum borrowing under the facility is $2 million. At November 10, 2015, there were no outstanding borrowings under the facility. We currently anticipate that our available cash as well as the expected cash from operations and available under the revolving credit facility will be sufficient to meet out anticipated working capital and capital expenditure requirements for at least the next 12 months. At the end of the third quarter, the Company had net operating loss carry forwards of approximately $43 million. I’ll now turn the discussion back over to Dr. William Roof, Chief Executive Officer.

Thank you, Bill. We’re optimistic about our third quarter progress that demonstrates our focus on our core identity business and on making our business more reliable and predictable from quarter-to-quarter. As noted in our press release, our commercial identity based business was up 24% in the third quarter this year versus last year. This means that the higher margins reduced from that business provide more working capital for the Company and at the lower margin unpredictable business such as wireless should eventually become marginalized. We believe that we’re on plan and that our turnaround strategy is working. As we move towards our strategic goal of market leadership with world class products and sustained profitability. We’re beginning to see the results of our detailed planning and hard work over the past 12 months. Our two newest products Age ID and Law ID are completing initial pilots and numerous locations throughout the country. And we look forward to our customers signing contracts that convert from pilot to revenue generating business. We’re evolving our products in all of our vertical markets to add compelling features and to develop strategies that provide strong barriers to entry for the competition. As in previous addresses to our shareholders, I will focus this presentation on five main areas and talk about progress in each area. Those areas are resources, markets, products, processes and intellectual property. Resources, we’re executing our strategic plan, management believes that we’re well capitalized to execute this plan and we’re beginning to see the results of new financial models that focus on high margin recurring revenue business. Our management team is sharply focused on maximizing internal effectiveness and product value to our customers. We have right sized the company and are identifying additional ways to reduce expenses, while we continue to build upon operational efficiencies as we ramp up revenues within our core verticals. Additionally, we’re leveraging expertise both from within and from outside the company to execute our strategic plan and vision. Markets, we have completed a larger percentage of our rebranding objectives and we’re focused on bringing Intellicheck into the public eyes. We have engaged a search engine optimization firm with the key objective that Intellicheck and our products will continue to move towards the top of online search results from queries pertaining to our products and market verticals. Our product and market positioning is critical to the Company’s growth objectives. Our positioning consists of an integrated approach that includes media, online presence and investor outreach. Our goal is to generate awareness and demand for Intellicheck products and services and to become the recognized market leader within our verticals. Our digital marketing strategy is in place and we will use our new website and rebranded materials to generate market awareness and demand. We have already began to see increased demand generated by our web presence and we’re moving ahead to convert that demand into new business. Our rebranded web presence is a very cost effective way to provide key information to our markets and we expect our digital online presence to increase our sales efficiency and reduce our selling costs. We believe that our strategic communications initiatives are creating brand value, visibility and market awareness at a level not previously achieved by our company. We see our strategy building investor confidence and our media coverage has expanded significantly since hiring our new PR from earlier this year. We have positive media stories in Q3 resulting from our media strategy, press releases and other outreach. We continue to deliver our key messages to target audiences and we’re optimistic about the traction we see from our messaging platform and messaging distribution. Our public relations efforts continue to support partnerships such as American Beverage Licensees and support access to a large base of potential new customers. In late October, we attended the International Association of Chiefs of Police, IACP convention in Chicago and the enthusiasm around our Law ID and Age ID products was in our opinion superb. Two of our directors attended as well and their expertise in this space and contacts in the law enforcement market are invaluable. After the convention, our executive staff had the opportunity to meet with new groups of potential investors in Chicago where we presented the Intellicheck brand and our vision for the Company’s future. The overall response was very positive. Products, we will speak about advancements with a few of our products during Q3. Law ID, Intellicheck Law ID enhances an officer situational awareness by minimizing the loss of visual contact with an unknown person during a field contact. Because it is available on mobile devices, Law ID ensures the officer has one hand free at all times whether on foot, bicycle, horseback, motorcycle or in a car. With Law ID, the officer simply scans the contacts ID barcode and it is instantly authenticated on the officer’s mobile device. Critical data fields that indicate the threat level are highlighted in red, yellow and green and visible at a glance. Having authenticated the contacts identity the officer can act accordingly, immediately de-escalating a potentially tense situation. Best of all, when the officer returns to the station, Intellicheck makes reporting faster and more accurate by automatically populating standardized form fields from the data retrieved during the ID authentication and from the mobile devices reporting features, including location and weather information. Law ID instantly accesses critical authoritative data sources, increases officer and citizen safety, provides the officer with accurate relevant data at a glance and supports faster more accurate reporting. We’re in the middle of our first Law ID pilot and we’re preparing for our next major software version release later this month. We’re also in the implementation stages with other police departments and we believe the interest and demand for this product are much better now than when we address the shareholders in August. As we mentioned previously, we believe these pilot programs demonstrate the products scalability and applicability to a variety of law enforcement agencies in operational environments. As Law ID has passed certification requirements for connection to the FBI's Criminal Justice Information System we continue to move forward in the approval processes for connection to additional state law enforcement methods in preparation for product go live at police departments within that space. We have a compelling product which delivers exceptional value and we have many agencies of different sizes and missions interested in utilizing this important new tool. We are learning and creating leverage from early innovators to move this product, quickly through the new product adoption stages with the goal of addressing this market estimated at appropriately $200 million plus in annual revenues. Age ID, selling Age restricted products like alcohol and tobacco is a compliance challenge, the risks and cost associated with non-compliance are high and rising. We believe that Intellicheck Age ID is the answer. Age ID instantly authenticates identification document such as drivers licenses. So our retailers immediately know if the customers ID is fake. That reduces risks of non-compliance without slowing down the purchase transaction. Best of all, Age ID works with mobile devices or integrated with existing point of sale solutions. We developed our Age ID product to curtail under age drinking because proprietors, who serve alcohol are also members of their communities who understand their obligations to the fellow citizens. Our Age ID product increases their awareness of fraudulent credentials by instantly and accurately authenticating customer identification. Age ID also verifies that the individual purchasing restricted goods is using an identification document and as of legal age to make the purchase. With the ability to read more than 200 unique barcode formats from all U.S. States, Canadian provinces and many Mexican driver licenses. In addition to other U.S. document points of identification, Age ID provides the most accurate and up to date solution. Age ID also offers regulatory compliant audit capabilities often needed by proprietors to demonstrate compliance with state regulations or to earn discounts from the liability insures. Age ID is available as a subscription service or customized solution designs to meet our clients specific needs. We now have our Age ID product operational in liquor establishments in several states including Texas, California, Mississippi, and Georgia. More importantly, our product has been well received by law enforcement state liquor authorities and we are implementing our strategy to work closely with those organizations to expand our Age ID footprint. Our partnership with ABL continues to generate business for Intellicheck. Our future press releases will describe the advances we have made into the age verification market with this new product. We’re excited about the ease and speed to market of Age ID and look forward with optimism to increase product acceptance quarter-to-quarter. Retail ID, our Retail ID product is gaining traction as well, as we sunset the company’s all enterprise license model and replace it with a monthly subscription model we’re having success in selling the products value to legacy customers and then moving them to our software-as-a-service subscription model. Additionally, we’re seeing success with Retail ID with new customers and within the credit card underwriting market. As with all our subscription base models, we expect retail ID to provide the company with annuities that continue to build as we add new customers quarter-by-quarter. Defense ID, our Defense ID product continues to generate revenues, we’re in the process of enhancing the product to provide greater security benefits to our customers and expect to add features that are in demand and critical to military base security. Processes, although we continue to focus on our sales and product development processes, our digital market presence process has moved up to probably less during Q3. Our new sales force is gaining traction in our markets, and our hybrid product development process consisting of internal and outsource software developers brings us the agility we need to add and release new features and functionality quickly. Time to market is critical, and we now have the capability and increase capacity to implement key features and functionality quickly with expectations that this will lead to faster growth. We believe our digital presence is generating more market awareness about our company and we see daily hits to our website and request for information becoming more meaningful to our business. Intellectual property, we have engaged a reputable law firm on a contingent fee basis to represent our company and shareholders as we move ahead with our intellectual property and patent infringement strategy. We have filed one patent infringement case, and this case is working its way through the courts. In general, we continue to implement our strategy defined by our previously identified five pillars. Those being one, to operate as efficiently and effectively as possible. Two, to focus on developing our key competencies into world-class products. Three, to manage our product offerings with the goal of focusing on value and scalability to our customer base. Four, to establish the position of market recognition and leadership based upon our core competencies in world-class products. And five, to define, implement and nurture a culture that supports this transformation. We’re excited and optimistic about the progress we’re making during this turnaround. 2015 is a transitional year for Intellicheck and we believe that our strategy was and is correct and we’re on plan to deliver high margin recurring revenues that provide predictable annuity type income to the company quarter-over-quarter. Customers need and appreciate our products and services, we believe our investments in our five key areas are starting to generate the returns we expected in terms of top and bottom line growth. In summary, thank you for your attention today. We look forward with great optimism and excitement to executing our strategy as we move the company forward. Thank you.

Thank you. [Operator Instructions] Thank you. Our first question comes from the line of Tom Mcguire, Private Investor. Please proceed with your question.

Hi, good day gentlemen and thanks for the run down. It was really helpful. I have a few questions. My first one is, I know you’ve made progress and your optimism is very, very apparent but we on the outside, we don’t see the sales funnels or your pipeline and we see the press releases when they come. But I’m wondering, when do we see the progress you’re making in the income statement. When does it become apparent that this is happening, this is taking shape. I know it’s a long machinery process, but is that something we should be seeing in income statement over the next few quarters or what.

Yes, hi, this is Bill. Thank you for your question. On our plan to generate recurring predictable revenues now since I got here about a year about and I would expect to see the fruits of this work in 2016, sometime after the middle of the year.

Okay. Okay, thank you. The second question about your IP, how valuable is your IP and when you encounter competitors in the marketplace. Do you see them infringing on your IP or some competitors going around your IP, would you just give me a kind of the layout there?

Well in think it was a little both, what we’re really seeing is a lot of infringements there. And this infringement has been going on for a long time, as far as the value of the IP goes its really, really hard to get a reputable firm to take a case contingent unless they understand to value other. So they had to – they did a lot of due diligence, we spent a lot of time with lawyers determining the value of the IP of the portfolio and whether or not it was defensible in court. We’ve been very fortunate to find a contingent fee. So I think that kind of speaks for the value of the IP portfolio, as far as competition to us we find that most of the folks in this space we believe are infringing and that’s one of the reasons we spent so much time and effort finding a contingent firm in laying some ground work in the legal system.

Okay, so because your IP is so valuable. Do you worry about having one of these infringers so much bigger, stronger financial company just going out and trying to make an unwanted take over of you, because your enterprise values next to nothing.

We certainly are aware of that potential we’ve discussed it among the directors and officers and legal team, but at this point right now, it’s not a concern.

Okay. And then regarding the police force pilot, do you have three up and running or is just one up and running. And other police departments will they require pilots, or will they hear by mouth this a great product and maybe you just - you don’t have to do pilots with them, why don’t you just kind of tell me your thoughts there.

Sure, we have one up and running, we’re in the implementation phase of more. Typically, we’re the branded product, when we are the first to market with it and as an innovative product, we the innovators that are - the real cutting edge of the purchasers, we’ll ask for pilots when something is technical. And we expect pilots to go on for a while, but we doing a few things we’re shortening the pilots and at some points in the near future we expect to be able to just go in with the sale then not have to do a pilot. What you really need is reference accounts and all of our pilots had agreed to be reference accounts let out the police officers come and watch them work, go on the street with them and so forth. And once we get some hands on with that you won’t need the pilots anymore.

Okay, my last question I think, if you’re taking these it’s been about a years since you’ve changed your business plan from hardware to software-as-a-service. Two questions, are you aware you want to be after a year - do you think you’ve accomplished what you thought [indiscernible] are you satisfied where you are. And secondly, have you gotten any blow back from some of your already in-house customers concerning the change in the model.

Yes, that’s a great question. We’re on plan and we’re excited that we’re on plan. So we are meeting our own expectations and hopefully we’ve able to articulate those to the shareholders well enough, so that they can see we’re on plan. Blowback, we’re absolutely getting blowback from customers who have considering their enterprise licensees for years and years with virtually no recurring revenue. But we have been heading some really good success and I want to thank, Bob Williamsen for his efforts in the team. And converting our enterprise customers to the SaaS model and we’ve been able to do that on a number of occasions and we’re in negotiations with some of our largest customers right now to do exactly that. And we’re having success, let’s say it’s something that we have to take customer by customer. We expect that some customers did not want to convert to the SaaS model, they want to keep their perpetual enterprise license with no recurring revenue. They will deal with those on a one line one basis, but overall we’re heading very good success.

Okay. Thanks a lot, gentlemen. Again it was a good call.

Thank you.

Thank you. [Operator Instructions] Our next question comes from the line of Jack Morbeck with First Washington Corp. Please proceed with your question.

Bill, this is Jack. A long time back, in one of our discussions, we talked a little bit about capital line of new markets, et cetera. Can you bring us at an update on where you stand with that capital one another providers et cetera? Thank you.

Hey, thanks, Jack. Good morning. We’ve been working with capital one on several customers calls, leading markets, Helzberg Diamond with a capital one customer as well and we’re continuing to factor then. We believe this is a good product for them to rollout to their entire merchant service group. We’re having great success in the customers that we’ve implemented with them. And so we’re continued discussions to roll that out to all their merchants Jack, at this point we’ve got several customers that we’ve already done so forth.

Tom asked the question relative to – when you thought you might bring some of these pilots, I guess in our side situation, you really believe, we don’t think we will see any meaningful contracts before the middle of the year or I just want to understand that.

We’re going to see meaningful contracts before the middle of the year and we’re going to see the pilots go away. Right now, we’re doing 90-day pilot, that’s an entire quarter. So that moves our revenues out of quarter, but as we bring those in and get rid of the pilots, we’re certainly going to have meaningful contracts before the middle of the year, as when they start to generate revenue that is the issue. If we have a pilot the revenue moves up 90-days, if we don’t have a pilot, we over than 90-days. And so our goal is to get enough reference to clinic that where we don’t need pilots anymore. We’ll be able to generate revenues in immediately it’s installed.

Okay. I think personally – the contract I know one that we – I guess Tom’s question had to do with income statement, but contracts will be very important. So thank you for your answer.

Thank you. We understand the importance of the contracts and we expect that where – that’s we’re on schedule we’re start to see those signed.

Thank you.

Thank you. Ladies and gentlemen, we’ve come to the end of our time for questions. I’d like to turn the floor back to management for any final concluding remarks.

We have to thank everyone for joining us today, and reiterate that we believe we’re on schedule. We have a strong team here. We have a support of Board of Directors as I mentioned they attend competition with us and applied our expertise to help the Company. We’re moving forward. We’re on schedule and we look forward to good announcements to you in the future. Thank you very much.

Thank you. This concludes today’s teleconference. You may now disconnect your lines at this time. Thank you for your participation.