1 IN CONFIDENCE

AMPS™ and Linear Rocket Motor Technology.

2

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The Result of a Medium Size Mine Blast on an MRAP.

Heavy MRAP design helps protect occupants, but Floor Shock and Global Acceleration are still issues.

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Operational Constraints of Heavy MRAP Vehicles.

Very high weight and ground clearance has many negative consequences:- • Unstable, very easy to roll on slopes. • Bogs down in wet or soft soil. Has to stay on roads/tracks, breaks bridges. • Extremely heavy fuel consumption 2 to 4mpg at $500/gallon at forward operating bases. • Recovery is difficult, requires heavy equipment, often under fire.

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The Global Mine and IED Threat to Armoured Vehicles.

Mines and Improvised Explosive Devices (IEDs) have become endemic in 112 conflict areas worldwide, and they kill/injure occupants of vehicles in 4 ways:-

• Penetration of vehicle - over-pressure, blast and fragmentation usually kills the occupants. Needs robust steel-based belly plate.

• Floor Shock effects – transmitted through vehicle structure, can fracture ankles, lower limbs, knees. Needs very rapid response active system.

• Gross Floor Deformation – floor can move at 5 – 10m/s. Needs massive force applied in 3 - 5ms to counteract mine forces.

• Global Acceleration – lifting of the whole vehicle. The rapid acceleration and resulting G level can kill on it’s own. Needs extreme rocket motor thrust levels applied within 10ms and lasting 30+ms.

The combined ABBS/ARMS (Active Mine Protection Systems) AMPS™ and Linear Rocket Motor (LRM™) technologies are designed to deal with all

these secondary threats to the vehicle occupants, assuming the belly plate is not penetrated.

March. 2015 – Fully Autonomous, Adjustable Response System Test, Rocket Motor Only.

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14ms 100ms

100ms 400ms Motor Inactive

Motor Active

Motor Inactive

Motor Active

Motor Active

Motor Inactive

May 2010 – 6kg AT Under-Belly Test on 2000kg SUV –Effect of Active Columns.

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IN CONFIDENCE 7

Land Rover Discovery After 6kg AT Mine Under-Belly Blast Test. Window glass left intact, no direct blast damage, minimal floor

deformation, demonstrating that the technology works even with a crude 10kNs VAFS motor generating only 1/3rd of the impulse required and no

stiffening top-hat spine on floor to reduce floor deformation.

Special Forces Vehicle Concept With VAFS/VGAM System - Nine Man Variant - 2013

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Linear Rocket Motors mounted on columns down to floor.

Both seats and floor become ‘Active’ being pushed down by action of motors in response to mine blast.

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Roger Sloman – Founder and MD

• First class BSc Organic & Polymer Chemistry 1971. • Founded Advanced Composites Group, in spare room and garage in Rochdale in

1974. • Introduced carbon fibre to Formula 1 cars in 1975. • Diversified component and prepreg business to aerospace, defence, industrial

products, starting in 1980. • Established US business to make product in US in 1988. • VC investment of £3.5 million in 1998. • Sold for £48 million in 2004, subsequently £274 million in 2012. • Retired on the £8 million payout in 2004 and played golf for a while. • Joined Aigis Blast protection as Technical Consultant Nov. 2007. • Had enquiry for NIMR vehicle (now built in UAE) blast protection Jan.2008 • Carried out blast test on similar size BRDM2 vehicle April 2008. • Left Aigis in July 2008. • Identified solution to Global Acceleration Nov. 2008. • Patented the VGAM concept Dec.2008.

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Armoured Vehicle LRM™ & AMPS™ System Manufacturing & Marketing Structure.

ABBS LTD Holds AMPS™ Patents

Advanced Blast LLC Primary licensee for US Sales

ABBS USA LLC US Marketing/Support and

ITAR firewall

Pratt And Miller US Design/integration partner

ARMS LTD 45/45 JV between ABBS Ltd & Falcon. LRM™ Production

Drehtainer Zero Shock Systems

e2v Ltd Sensor, Control, and

Initiation systems

The Falcon Project Ltd R&D of Rocket Motors

TenCate and Plasan likely Global Marketing Partners

11 IN CONFIDENCE

ABBS/ARMS GM Share From US Sales on 50:50 Split Basis.

CUSTOMER

ABBS USA LLC

Overhead Costs.

$105,000 GM from US sale.

ABBS LLC in USA

Half of GM from US sale is

retained by ABBS LLC.

ABBS Ltd. In UK

ARMS Ltd.

Half of GM from US sale is paid to ABBS

Ltd.

Half of ABBS Ltd. GM share from US sale

is paid to ARMS Ltd.

$100,000

$50,000

$5000

$50,000

$25,000

$25,000

$25,000

GM from US sales is split between US and the UK. If major funding is obtained from a marketing partner deal that does not involve US operation shares the amount of US GM retention will be adjusted downwards from the 60:40 split currently used. Moving to 50:50 or even 1/3rd:2/3rds US/UK is possible. Current figures are based on 60:40 USA/UK split of Gross Margin. Direct Production costs are paid to ARMS on delivery of hardware to ABBS Ltd.

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• £1.43million raised in three tranches from 2014 to 2016 (all EIS qualified.)

• £1million currently being raised for 5%, £20million post investment valuation.

• ABBS is currently in negotiation with two major global players to market the AMPS™ technology to the armoured vehicle sector, which could result in a large up-front license payment, £8 million is targeted.

If an up-front payment is made to ABBS it will be split equally with ARMS as the deal will be based on the patent rights held by both ABBS and

ARMS.

ABBS Investment Summary.

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Armoured Vehicle Market Opportunity

Primary Focus: Armoured Vehicles

• 400,000 armoured vehicles worldwide • 210,000 N America & Europe (NATO focus) • About 50,000 new military armoured vehicles built annually globally. • Also about 20,000 VIP luxury/SUV vehicles. (Possible shorter lead

time to production quantities, maybe 2 years?)

Revenue Potential

• Revenue per vehicle = £50k - £250k • Average revenue/vehicle = £125k • Gross margin range = 45% – 70%

Value of N America & European Military Armoured Vehicle Market

• Assuming 20 year cycle (5% of fleet) = £715m / year

CONCLUSION – There is no practical limit to the market value available to ABBS.

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Active Systems are the Only Way Forward – Who Says? - TARDEC

Active Blast Mitigation Approach - Exterior Blast Mitigation Technologies Big Leap: Survivability system designed from the occupant outward to protect against a significantly higher underbody system level blast event.

Underbody:- 1. Active Floors 2. Active Blast Mitigation 3. Active Seats

Purpose:- • Prevent catastrophic deformations in the vehicle hull that generate high floor loads resulting in occupant injuries • Reduce peak flooring accelerations • Control the transfer of momentum to the vehicle cab under various threat loads. • Provide an electric signal to various blast mitigation measures (technologies) in an effort to reduce injuries to the Soldier. • Reduce lower extremity injuries by controlling loads between vehicle cab and floor.

Ref:- Ground System Survivability Presentation - Jeff Koshko

Associate Director, GSS , US Army Tank & Automotive R&D Centre. TARDEC INDUSTRY DAYS – March 18-19 2015

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Active Systems are the Only Way Forward – Who Says?

Defence IQ Armoured Vehicle Market Report -2017 – Just Published

“ Analysis of Technology Investment Over the Next Decade. Question:- In terms of improving performance and survivability, which technology do you think will have the greatest impact on the armoured vehicle market over the next decade?

After this is a bar chart showing Active Mine Protection Systems at 56%, the highest of all the categories, followed by:-

Active Mine Protection Systems (AMPS), and other innovations to mitigate the specific effect of IED blasts were identified as likely to have the greatest impact on future armoured vehicle design, with more than half respondents citing these as front-running technologies. This overtakes the factor of more general Active Protection Systems (APS) – last year’s leader – by 3 percent. Any military strategist will tell you that the IED threat is not going away. At present, innovators are reflecting on lessons learnt from Iraq and Afghanistan and developing more sophisticated systems for future armoured vehicles to face hybrid threats in complex operating environments.

The development of Active Mine Protection Systems is central to the work in this field.”

Intellectual Property Portfolio

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14ms 100ms

100ms 400ms Motor Inactive

The AMPS™ technology is fully protected (£600k invested so far) worldwide by patents and applications outstanding covering:-

1. Pushing down on the vehicle to prevent global acceleration.

2. Using active internal columns to control floor deformation.

3. Using ballistic mass ejection to produce downwards thrust.

4. Using sequential mass ejection to extend the force/time curve.

5. The Linear Rocket Motor (LRM™) design.

6. The belly plate sensor system.

7. Using the LRM’s as part of a vehicle load bearing structure.

8. Using LRM’s as a Helicopter Crash Prevention System.

9. Composite reinforced belly plate to minimise distortion over mine location.

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Current Standard Linear Rocket Motor Design for Armoured Vehicle Application

• Dimensions:- 1100 x 120 x 120 mm with 10mm wall thickness. • Initiation time:- 10ms from shockwave detection (will be reduced to about 5 – 6ms shortly) • Propellant load:- 4.0kg HTPB/Al/AP • Total impulse/peak thrust:- about 6.2kNs impulse, 153,000lbf (68 tonnes) peak thrust. • Duration:- about 10ms after first efflux appears. • Double width rectangular section 15kNs version currently being designed and tested. • Motor burns propellant at the rate of 400kg per second. • Eight motors to generate 50kNs impulse burn propellant at the rate of 3.2 tons per second.

This is ground-breaking innovative technology with many different applications.

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The Only Competition, and Probably the First Major Customer – TenCate

Dutch-based TenCate’s system only attempts to deal with Global Acceleration, not all the other threats to the vehicle occupants that the ABBS systems do. Their technical solutions for each part of the system are also very inferior to the ABBS solutions in spite of spending about £30million so far, compared to ABBS’s £6million.

• Very heavy Ballistic Mass Ejection (firing masses out of mortar barrels) vs ABBS lightweight Rocket Motors for counter impulse generation. (1/3rd the weight.) This is mainly why the TenCate system is impractical, and why they want to use our LRM’s.

• Too rapid impulse delivery breaks vehicles vs the softer ABBS impulse delivery which allows location of motors anywhere on the vehicle.

• Inaccurate, un-reliable, slow, accelerometers to measure vehicle acceleration vs ABBS simple crush sensors to measure belly plate deformation, and hence the mine blast strength within 2ms of the event.

• Complex algorithms in safety-critical software required in Ten Cate system vs the ABBS hard-wired automatic, adjustable, ultra-fast response control system which only uses firmware to control firing decisions.

• Ten Cate offered to buy ABBS patents for £1m in 2013 and rejected a counter offer of £6m + on going fees.

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• Developing initial LRM™ and AMPS™ manufacturing and assembly capability in ARMS on the Falcon site at Westcott.

• Co-operative global marketing and technology development by deals with major industry players – probably Plasan and TenCate + others. Monopoly supply of LRM’s to this market should be established.

• CRADA (Co-operative R&D Agreement) with TARDEC, the US Army’s Tank and Automotive R&D Centre in Detroit to evaluate the AMPS™ technology.

• BAe Land Systems test programme in USA Spring 2017, Plasan in Israel, IABG and the German Army in Germany. US market development generally.

• R&D and production staff resource development in both ABBS and ARMS.

• Middle East/Asian region operations development focused on novel blast and ballistic protected VVIP vehicle design. (New JV being formed to exploit this very high value market niche, will qualify for SEIS and EIS schemes.)

• Qualification and certification programme for military service.

Current Lines of Business Development.

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AMPS™ System Sales Prices

Vehicle weight (tons)

Assumed Impulse

Required (kNs)

Number of Motors of

Production 15kNs Design

ABBS System Sales Price

(£)

Likely Margin %

(Gross)

SUV 30 2 50,000 35

Up to 10 45 3 75,000 45

10 - 20 60 4 100,000 55

20-30 90 6 175,000 60

30+ 120 8 250,000 70

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Use of Funds - ARMS

ABBS Current Fund-Raising

Use of funds

Nov ’16 to June’17

(£ inc. VAT)

New Funds/Income

(£)

New funds to be raised in UK by ABBS Ltd. Nov. 2016. 1,000,000 GM on £300,000 sales to USA for BAe project, Plasan Israeli trials, and ABBS Ltd. UK R&D Grants.

250,000

VAT Refunds 110,000

Total Income 1,360,000 US Marketing Costs 120,000 CAD/FEA/LS Dyna and Design Engineer Costs 100,000

Patent costs. 120,000

Internal and ARMS/Falcon R&D. 400,000

Professional fees; Innovate UK grant advisors, insurance, accountant, legal, transaction, Board etc.

30,000

Admin/Finance staff costs, including office/travel etc. 110,000

Total Planned Expenditure 880,000 880,000 Reserve in ABBS. 480,000

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Mid-Term Projected Sales/Margins – ABBS Ltd.

ABBS Ltd. 2017 2018 2019 2020 2021 2022

ABBS Ltd. Turnover £’000’s 989 1,621 3,533 7,270 10,950 14,430

ABBS Direct + OH costs.

(£’000’s) 1,215 1,510 2,440 4,050 5,685 6,658

Net Margin after GM share.

(£’000’s) --226 111 1,093 3,220 5,265 7,772

Net Margin % after GM

share. -22 7 31 44 48 54

N.B. These figures relate only to the AMPS™ products that flow through ABBS Ltd. They do not include any profits transfer/dividends from the US operation, or any dividends from ARMS, which are expected to be a major income stream within 3 years, but will be subject to taxation considerations to optimise the overall results.

Also excluded is any income from such as the proposed marketing deal, or any other patent licensing deal income with other global marketing partners.

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Longer Term/Project-Based Sales

• The figures presented in the previous slide represent a ‘normal’ smooth progression whilst avoiding presenting a ‘hockey stick’ graph.

• However, the reality is more likely to include large step changes in sales and profits as the AMPS™ technology is selected for specific vehicle programmes. Taking conservative figures:-

• 100 vehicle systems at £100k gives £10 million sales and £5+ million GM.

• 1,000 vehicle systems at £100k gives £100 million sales and £50+ million GM.

• 10,000 vehicle systems at £100k gives £1 billion sales and £500+ million GM.

• Clearly, the timing of such sales is currently impossible to predict, but it is highly likely that projects at the lowest level will arise within 3 to 4 years, and be followed by projects at the second level in 5 to 7 years.

As an example of the potential, the HMMWV (HUMVEE) vehicle (over 200,000 built) replacement, the JLTV will be made in 60,000+ quantity for the US alone,

and in addition will be exported widely.

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Basis of ABBS Valuation

• Since sales of the AMPS™ systems for test and evaluation by potential customers are only just starting the valuation cannot be based on conventional parameters such as historic sales and profits.

• Hence the current valuation is based on:-

• The strength of the IP and patent protection for the AMPS™ and LRM™ concepts.

• The fact that the basic AMPS™ system for armoured vehicles has been proven, and all the elements required are well developed, just needing upgrading to production standard.

The high likelihood of exceptional long term profitability, and hence the potential company value is the primary rationale for the current valuation. The AMPS™ technology is critically important in protecting the occupants of armoured vehicles hit by mines/IED’s, and due to the physics involved

it is not possible to develop a superior system. .

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Un-limited Company Potential

• Given the scale of the high-value, high profit margin AMPS™ application with a market value of £10+billion over the 15 to 20-year lives of the patents, ABBS obviously has un-limited potential in terms of sales and profits.

• ABBS holds about 90% of the US operation shares, and just under

40% of ARMS. The dividends that will be available from both have not been included in the figures presented earlier.

• A minimum target for shareholder returns is in the 10 – 20 times

range within 10 years, but timing is not predictable.

If the expected profits are made then dividends at least equal to investors original stakes should

be payable annually.

26 IN CONFIDENCE

US Company/New JV Investment Option.

• For over a year now we have intended to pursue the sale of about 23% of the ABBS LLC shares for $7 million.

• This action has been held because of the ongoing success of raising sufficient new funding in the UK and Europe.

However it is now opportune to raise the issue in this forum, and we will be happy to discuss it with

anyone interested.

Similarly, the new JV option developing the ultimate VVIP blast and ballistic protected SUV/luxury vehicle will

be an SEIS/EIS investment available in January 2017.

IN CONFIDENCE 27

Advanced Blast & Ballistic Systems Ltd.

Thank you for your attention.

www.advanced-blast.com

roger.sloman@advanced-blast.com

Tel:- (44) 01335 360663 Mobile:- (44) 07989 381057