SOURCE: IDS Worldwide, Inc.

July 11, 2006 10:22 ET

IDS Updates Homeland Security Worldwide (HLS) Offer to Acquire IDS Common Shares

HLS Informs IDS Regarding Acquisition Financing

ORLANDO, FL -- (MARKET WIRE) -- July 11, 2006 -- IDS Worldwide, Inc. (PINKSHEETS: IDWD) reported today that IDS, HLS and its investment bankers will conduct meetings today and tomorrow to work out details regarding HLS' previous all cash offer of $2.35 for each common share of IDS Worldwide, Inc. common stock. IDS is requesting that HLS and its advisors provide as soon as feasible a written formal tender offer.

IDS will also try to ascertain during these meetings for its shareholders the anticipated timeline for the acquisition to be completed. IDS is aware that part of the funding facility for the HLS acquisition is a bond offering overseas and during the meetings will also ask HLS the timeline and affect of this offering on the closing of the acquisition. IDS believes the offer by HLS when consummated would be in the best interests of long term shareholders. Previously IDS has stated that this purchase would not affect the division and IDS will pursue its earlier plans and/or consider offers from 3rd parties for the division.

HLS further clarified to IDS yesterday that the documents signed on July 5, 2006 regarding their previously announced acquisition plans were "closing escrow documents" and not the final closing documents; IDS regrets any confusion caused by HLS terms enclosed in previous press release regarding these transactions. Since the escrow has not yet closed no control has taken place between the parties to the transactions, there has no additional information provided to IDS. IDS hopes these meetings will bring further clarification to this matter.

Additionally IDS will request HLS and its advisors the timeline for providing the additional information to obtain the CUSIP number for the Homeland Security Division purchased by HLS and the associated Special Dividend that has been disbursed to qualified IDS common stockholders.

IDS executives are aware there has been investor confusion over the dividend after it has been identified as a spin-off distribution. Homeland Security Worldwide (HLS) previously purchased the Homeland Security Division of IDS Worldwide, Inc. Although the name of the acquiring company and the IDS division are similar the two companies were never part of the same company. IDS Homeland Security Division ground security services have used the abbreviation "HLS" on their patrol cars and this may have lead to an improper conclusion that the two entities were the same, leading to investors questions similar to "why is the company buying itself." This would be an incorrect interpretation of the acquisition.

HLS has informed IDS it will use funding facilities with its current bankers and a $50 Million Bond offering overseas that has been planned previously for expansion and worldwide acquisitions.

HLS has increased its offer to $2.35 per share and informed IDS upon acceptance of the offer HLS would have its banker JPMorgan Chase set up the appropriate closing escrow accounts. IDS has informed HLS that upon acceptance of the offer HLS will have to pay a $5 Million non-refundable deposit to be placed in the escrow accounts until closing.

HLS the acquiring company has chosen to continue to use the "HLS" abbreviation due to the significant brand recognition that IDS had established for the division acquired. IDS was also supplied with documentation from HLS yesterday showing the rapid growth of its ground security operations continue with record orders being placed with Tyco division DSC yesterday. HLS has also begun shipping worldwide to dealers, distributors and consumers the HLS Biometric Encryption Flash Drives.

IDS CEO Patrick Downs stated, "The offer currently proposed for the common stockholders of the market represent a substantial premium to current market prices. HLS has stated the reason for the significant premium is to entice insiders to surrender their shares during the buyout. I believe considering the nature of most investors today who seek shorter terms gains over long term investing this offer, when consummated, would fit their investment parameters. As CEO I personally do not plan to sell my restricted shares of common stock for the $2.35 offer. Some insiders have stated they will sell a portion of their holdings under this offer but no insider has filed to sell their shares. My goal is now, as previously, to continue to pursue long term shareholder growth but I feel an offer with this premium to the market when consummated will benefit the majority of the public shareholders."

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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