SOURCE: IDS Worldwide, Inc.

August 28, 2006 10:05 ET

IDS & HLS Have Concluded Escrow Arrangements for $2.35 Cash Buyout for IDS Common Shares

HLS and IDS Announce Two New Biometric Encryption Products

ORLANDO, FL -- (MARKET WIRE) -- August 28, 2006 -- IDS Worldwide, Inc. (PINKSHEETS: IDWD) reported today that the long complicated series of transactions between IDS and HLS have finally reached the final stages. IDS and HLS executives agreed on the buyout terms for the majority insiders stock and the breakout of the division prior to the cash buyout of public shares of IDS Worldwide, Inc. HLS over the weekend has met the escrow requirements of the buyout and filed and received all government approvals for the IDS and HLS deal.

HLS established additional executive offices on the prestigious Sheikh Zayed road over the last week to be utilized during the massive construction of the HLS headquarters being built off Emirates road next to the new Dubai convention center. Additionally, IDS executives secured residential villas in the Dubai Marina area and have made arrangements to move their families to Dubai to make the executives more readily available during this transition period. This moving of the headquarters to Dubai will add significantly to HLS value for the next decade due to the company's high-level involvement in the $100 Billion construction underway.

HLS fire and security division will undertake the massive deployment of fire suppression and security projects throughout the UAE. Additionally, the location in Dubai for HLS will give the company an extreme advantage due to the fact that there is NO CORPORATE TAX in the UAE; this will give HLS a minimum 35% advantage over other competitors in the company's various market segments.

IDS hopes to conclude final arrangements this week for the previously announced division merger. One of the principals to the deal had been hospitalized for the majority of the last 10 days and returned home from the hospital this past Friday. IDS stockholders will receive a 1:1 common stock distribution in the new fully reporting merged company IDS executives are currently contemplating a different public name for this division as it will also include software products already developed by IDS software teams to be released to the business sectors in the coming quarter. This division will continue to develop breakthrough software technologies as it has done in the past to increase shareholder value in the new entity.

Upon completion of the breakout of the division, IDS and HLS will submit to the appropriate agencies the necessary buyout documentation. IDS is extremely aware of the "short position" that has been reported under the latest enforcement rules. This significant short position if not covered prior to the closing of the HLS and transaction will be responsible for both the $2.35 per share cash offer and the distribution shares. IDS plans to release the closing details for the merger pre-market August 31, 2006.

Additionally, IDS and STS Joint Venture selling the HLS Bioflash Drive has received overwhelming response from both government agencies and GSA-approved suppliers. The Joint Venture has received a steady stream of government orders around the clock in the last 24 hours under the OMB mandatory directive issued on August 10, 2006. Since it is a mandatory directive, GSA vendors, some who have ordered hundreds of units today, can immediately implement the HLS Bioflash security in any federal, state or local government agency.

IDS and STS will issue a joint press release this afternoon with the government agencies' purchases and HLS Bioflash GSA implementation. To date GSA vendors with over 1100 local, state and federal agency clients have purchased and installed the HLS Bioflash Drive. The HLS Bioflash drive has been installed in the top government security agencies after rigorous testing in the past two weeks. This testing verified that HLS encryption is the highest level of data security available far surpassing the antiquated 256 AES encryption used by most competitors' biometric USB drives. HLS Bioflash is also the lowest price biometric flash drive sold to the government according to the latest GSA schedules for similar devices. Currently the lowest price 1GB Biometric Flash Drive on the GSA schedule (which have the old 256 AES encryption which can be hacked in a short period of time) is $206.00 per unit and HLS GSA price is $125.00.

Combined with the OMB mandatory directive, HLS superior encryption technology and the lowest price available to government agencies this will allow the company to capture significant amounts of government orders to meet the OMB directive. Agencies such as the Veterans Administration, DOT, HUD, EPA and TSA currently have hundreds of millions of dollars allocated for IT security enhancements that must be spent by September 30, 2006.

HLS has received from several government security agencies requests for some customization of HLS Bioflash product. Fortunately, HLS and IDS software programmers had already completed two new versions of biometric products that met or exceeded these security agency requests. On or before October 15, 2006 HLS will release a version of HLS Bioflash Drive with the same proprietary encryption exceeding the agencies current 256 AES encryption and HLS proprietary computer locking software but with no download capabilities. Security agencies requested this custom design for their most secure areas.

The second product to be released to the market on the same day in October is at the request of Fortune 100 companies to be used on millions of cash registers in their retail locations around the world. This device the HLS Biometric Encryption Computer Mouse will have the same high-level encryption and locking capabilities for the cash registers with no download capabilities. Retail chains will also be allowed to use the same hardware and software for time and attendance functionality.

These two new revolutionary biometric encryption products, considering they have already received custom requests for system wide implementation, will add significantly to both revenues and profits for the company and continuing the company's main goal of increasing long term shareholder value thru continuous technology innovations.

IDS has received requests to clarify certain points. Every investor purchasing IDS common stock (IDWD) will be eligible to receive the $2.35 cash per share from HLS, the distribution shares and the HLS dividend shares already received for stock holders who previously qualified (these Special Dividend shares have already been distributed to the IDS common stockholders in restricted form that owned IDS stock on the previously announced record date).

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Statements in this release that are forward-looking statements are based on current expectations and assumptions that are subject to known and unknown risks, uncertainties, or other factors which may cause actual results, performance, or achievements of the company to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Actual results could differ materially because of factors such as the effect of general economic and market conditions, entry into markets with vigorous competition, market acceptance of new products and services, continued acceptance of existing products and services, technological shifts, and delays in product development and related product release schedules, any of which may cause revenues and income to fall short of anticipated levels. All information in this release is as of the date of this release. The company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the company's expectations.

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