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**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM 20-F/A**

**☐          REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934**

**OR**

**☒          ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2015**

**OR**

**☐          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**OR**

**☐          SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**Date of event requiring this shell company report . . . . . . .**

**For the transition period from _________________ to _________________**

**COMMISSION FILE NUMBER 0-28542**

**ICTS INTERNATIONAL N.V.**

**-----------------------------------------------------------------------------**

**(Exact Name of Registrant as specified in its charter)**

**Not Applicable**

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| Part I       |                                                                             |   |
|--------------|----------------------------------------------------------------------------------|--------|
| ------       |                                                                             |   |
| Item 1       | Identity of Directors, Senior Management and Advisers                            | 6      |
| Item 2       | Offer Statistics and Expected Timetable                                          | 6      |
| Item 3       | Key Information                                                                  | 6      |
| Item 4       | Information on the Company                                                       | 14     |
| Item 5       | Operating and Financial Review and Prospects                                     | 26     |
| Item 6       | Directors, Senior Management and Employees                                       | 42     |
| Item 7       | Major Shareholders and Related Party Transactions                                | 50     |
| Item 8       | Financial Information                                                            | 52     |
| Item 9       | The Offer and Listing                                                            | 54     |
| Item 10      | Additional Information                                                           | 55     |
| Item 11      | Quantitative and Qualitative Disclosures about Market Risk                       | 68     |
| Item 12      | Description of Securities other than Equity Securities                           | 68     |
|         |                                                                             |   |
| Part II      |                                                                             |   |
| -------      |                                                                             |   |
| Item 13      | Defaults, Dividend Arrearages and Delinquencies                                  | 68     |
| Item 14      | Material Modifications to the Rights of Security Holders and the Use of Proceeds | 68     |
| Item 15      | Controls and Procedures                                                          | 69     |
| Item 16A     | Audit Committee Financial Expert                                                 | 69     |
| Item 16B     | Code of Ethics                                                                   | 69     |
| Item 16C     | Fees Paid to our Independent Registered Public Accounting Firm                   | 70     |
| Item 16D     | Purchases of Equity Securities by the Issuer and Affiliated Purchasers           | 70     |
| Item 16E     | Change in Accountant's Disclosure                                                | 70     |
| Item 16F     | Corporate Governance                                                             | 70     |
|         |                                                                             |   |
| Part III     |                                                                             |   |
| --------     |                                                                                  |   |
| Item 17      | Financial Statements                                                             | 70     |
| Item 18      | Financial Statements                                                             | 71     |
| Item 19      | Exhibits                                                                         | 71     |
|         |                                                                                  |   |
| Exhibits     |                                                                                  |   |
| --------     |                                                                                  |   |
| Exhibit 12.1 | Certification                                                                    |   |
| Exhibit 12.2 | Certification                                                                    |   |
| Exhibit 13.1 | Certification                                                                    |   |
| Exhibit 13.2 | Certification                                                                    |   |

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| Item 1. | Identity of Directors, Senior Management and Advisers |
|---------|-------------------------------------------------------|

| Item 2. | Offer Statistics and Expected Timetable |
|---------|-----------------------------------------|

| Item 3. | Key information |
|---------|-----------------|

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|                          |   | (U.S. Dollars in Thousands) |    |
|-------------------------------|--------|-----------------------------|---------|
|                          |   | December 31,                |    |
|                          |   | 2015                        |    |   | 2014 |   |   | 2013 |   |   | 2012 |   |   | 2011 |   |
| Cash and cash equivalents     |   | $                           | 7,912   |   |   | $ | 5,973 |   |   | $ | 3,134 |   |   | $ | 945 |   |   | $ | 2,278 |   |
| Total current assets          |   |                        | 40,002  |   |   |   | 32,893 |   |   |   | 26,938 |   |   |   | 20,154 |   |   |   | 20,664 |   |
| Total assets from             |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  discontinued operations |   |                        | -       |   |   |   | 134 |   |   |   | 484 |   |   |   | 1,404 |   |   |   | 2,735 |   |
| Total assets                  |   |                        | 42,349  |   |   |   | 35,005 |   |   |   | 29,139 |   |   |   | 22,559 |   |   |   | 23,882 |   |
| Total current liabilities     |   |                        | 45,007  |   |   |   | 35,479 |   |   |   | 32,115 |   |   |   | 30,461 |   |   |   | 29,649 |   |
| Total liabilities from        |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  discontinued operations |   |                        | -       |   |   |   | 102 |   |   |   | 464 |   |   |   | 3,148 |   |   |   | 4,710 |   |
| Total liabilities             |   |                        | 84,557  |   |   |   | 74,064 |   |   |   | 69,495 |   |   |   | 59,245 |   |   |   | 51,496 |   |
| Shareholders' deficit         |   |                        | (42,208 | ) |   |   | (39,059 | ) |   |   | (40,356 | ) |   |   | (36,686 | ) |   |   | (27,614 | ) |

|                                       |   | (U.S. Dollars in Thousands) |      |
|--------------------------------------------|--------|-----------------------------|-----------|
|                                       |   | Year ended December 31,     |      |
|                                       |   | 2015                        |      |   | 2014 |   |   | 2013 |   |   | 2012 |   |   | 2011 |   |
| Revenue                                    |   | $                           | 187,022   |   |   | $ | 172,929 |   |   | $ | 124,497 |   |   | $ | 96,346 |   |   | $ | 93,340 |   |
| Cost of revenue                            |   |                        | 167,844   |   |   |   | 152,224 |   |   |   | 108,995 |   |   |   | 84,531 |   |   |   | 80,903 |   |
| GROSS PROFIT                               |   |                        | 19,178    |   |   |   | 20,705 |   |   |   | 15,502 |   |   |   | 11,815 |   |   |   | 12,437 |   |
| Operating expenses:                        |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Research and development             |   |                        | 2,565     |   |   |   | 2,207 |   |   |   | 2,182 |   |   |   | 2,264 |   |   |   | 2,810 |   |
|  Selling, general and                 |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   administrative                 |   |                        | 20,406    |   |   |   | 17,316 |   |   |   | 16,925 |   |   |   | 14,047 |   |   |   | 14,032 |   |
| Forgiveness of debt                        |   |                        | -         |   |   |   | - |   |   |   | (1,312 | ) |   |   | - |   |   |   | - |   |
|   Total operating expenses       |   |                        | 22,971    |   |   |   | 19,523 |   |   |   | 17,795 |   |   |   | 16,311 |   |   |   | 16,842 |   |
| OPERATING INCOME (LOSS)                    |   |                        | (3,793    | ) |   |   | 1,182 |   |   |   | (2,293 | ) |   |   | (4,496 | ) |   |   | (4,405 | ) |
| Other income (expenses), net               |   |                        | (760      | ) |   |   | 448 |   |   |   | (3,987 | ) |   |   | (3,107 | ) |   |   | (688 | ) |
| INCOME (LOSS) BEFORE INCOME                |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| TAX BENEFIT (EXPENSE)                      |   |                        | (4,553    | ) |   |   | 1,630 |   |   |   | (6,280 | ) |   |   | (7,603 | ) |   |   | (5,093 | ) |
| Income tax benefit (expense)               |   |                        | (149      | ) |   |   | (90 | ) |   |   | 1,026 |   |   |   | (223 | ) |   |   | 289 |   |
| INCOME (LOSS) FROM CONTINUING              |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| OPERATIONS                                 |   |                        | (4,702    | ) |   |   | 1,540 |   |   |   | (5,254 | ) |   |   | (7,826 | ) |   |   | (4,804 | ) |
| Income (loss) from discontinued operations |   |                        | -         |   |   |   | (109 | ) |   |   | 1,821 |   |   |   | (1,190 | ) |   |   | 2,656 |   |
| NET INCOME (LOSS)                          |   | $                           | (4,702    | ) |   | $ | 1,431 |   |   | $ | (3,433 | ) |   | $ | (9,016 | ) |   | $ | (2,148 | ) |
|                                       |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NET INCOME (LOSS) PER                      |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| SHARE, BASIC AND DILUTED:                  |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Continuing Operations                      |   | $                           | (0.58     | ) |   | $ | 0.19 |   |   | $ | (0.66 | ) |   | $ | (0.97 | ) |   | $ | (0.60 | ) |
| Discontinuing Operations                   |   |                        | -         |   |   |   | (0.01 | ) |   |   | 0.23 |   |   |   | (0.15 | ) |   |   | 0.33 |   |
| Net income (loss) per share                |   | $                           | (0.58     | ) |   | $ | 0.18 |   |   | $ | (0.43 | ) |   | $ | (1.12 | ) |   | $ | (0.27 | ) |
| Weighted average number                    |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| of shares outstanding                      |   |                        | 8,085,599 |   |   |   | 8,054,390 |   |   |   | 8,036,780 |   |   |   | 8,036,698 |   |   |   | 8,014,882 |   |

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| Item 4. | Information on the Company |
|---------|----------------------------|

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|  | · | Charter Flight Screening for Airlines - which includes security check of passengers' body and carry-on items. |
|--|--------|---------------------------------------------------------------------------------------------------------------|

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|  | · | Cargo Security Screening - for some international and domestic carriers. |
|--|--------|--------------------------------------------------------------------------|

|  | · | Aircraft Search – Search of the entire aircraft to detect dangerous objects. |
|--|--------|------------------------------------------------------------------------------------|

|  | · | cleaning the aircraft interior |
|--|--------|--------------------------------|

|  | · | conducting cabin searches |
|--|--------|---------------------------|

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| Year ended   |   |   |   |
|--------------|--------|--------|--------|
| December 31, |   |   |   |
| 2016         |   | $      | 1,356  |   |
| 2017         |   |   | 424    |   |
| 2018         |   |   | 353    |   |
| 2019         |   |   | 316    |   |
| 2020         |   |   | 312    |   |
|         |   | $      | 2,761  |   |

| Item 5. | Operating and Financial Review and Prospects |
|---------|----------------------------------------------|

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|                                              |   | (U.S. Dollars in Thousands) |    |
|---------------------------------------------------|--------|-----------------------------|---------|
|                                              |   | Year ended December 31,     |    |
|                                              |   | 2015                        |    |   | 2014 |   |   | 2013 |   |
| Revenue                                           |   | $                           | 187,022 |   |   | $ | 172,929 |   |   | $ | 124,497 |   |
| Cost of revenue                                   |   |                        | 167,844 |   |   |   | 152,224 |   |   |   | 108,995 |   |
| GROSS PROFIT                                      |   |                        | 19,178  |   |   |   | 20,705 |   |   |   | 15,502 |   |
| Operating expenses:                               |   |                        |    |   |   |   |   |   |   |   |   |   |
|  Research and development                    |   |                        | 2,565   |   |   |   | 2,207 |   |   |   | 2,182 |   |
|  Selling, general and administrative         |   |                        | 20,406  |   |   |   | 17,316 |   |   |   | 16,925 |   |
| Forgiveness of debt                               |   |                        | -       |   |   |   | - |   |   |   | (1,312 | ) |
|   Total operating expenses              |   |                        | 22,971  |   |   |   | 19,523 |   |   |   | 17,795 |   |
| OPERATING INCOME (LOSS)                           |   |                        | (3,793  | ) |   |   | 1,182 |   |   |   | (2,293 | ) |
| Other income (expenses), net                      |   |                        | (760    | ) |   |   | 448 |   |   |   | (3,987 | ) |
| INCOME (LOSS) BEFORE INCOME TAX BENEFIT (EXPENSE) |   |                        | (4,553  | ) |   |   | 1,630 |   |   |   | (6,280 | ) |
| Income tax benefit(expense)                       |   |                        | (149    | ) |   |   | (90 | ) |   |   | 1,026 |   |
| INCOME (LOSS) FROM CONTINUING OPERATIONS          |   |                        | (4,702  | ) |   |   | 1,540 |   |   |   | (5,254 | ) |
| Income (loss) from discontinued operations        |   |                        | -       |   |   |   | (109 | ) |   |   | 1,821 |   |
| NET INCOME (LOSS)                                 |   | $                           | (4,702  | ) |   | $ | 1,431 |   |   | $ | (3,433 | ) |

|                                              |   | Year ended December 31, |   |
|---------------------------------------------------|--------|-------------------------|--------|
|                                              |   | 2015                    |   |   | 2014 |   |   | 2013 |   |
| Revenue                                           |   |                    | 100.0  | % |   |   | 100.0 | % |   |   | 100.0 | % |
| Cost of revenue                                   |   |                    | 89.7   | % |   |   | 88.0 | % |   |   | 87.5 | % |
| Gross profit                                      |   |                    | 10.3   | % |   |   | 12.0 | % |   |   | 12.5 | % |
| Research and development expenses                 |   |                    | 1.4    | % |   |   | 1.3 | % |   |   | 1.7 | % |
| Selling, general and administrative expenses      |   |                    | 10.9   | % |   |   | 10.0 | % |   |   | 13.6 | % |
| Forgiveness of debt                               |   |                    | 0.0    | % |   |   | 0.0 | % |   |   | (1.1 | )% |
| Total operating expenses                          |   |                    | 12.3   | % |   |   | 11.3 | % |   |   | 14.3 | % |
| Operating income (loss)                           |   |                    | (2.0   | )% |   |   | 0.7 | % |   |   | (1.8 | )% |
| Other income (expense), net                       |   |                    | (0.4   | )% |   |   | 0.2 | % |   |   | (3.2 | )% |
| Income (loss) before income tax benefit (expense) |   |                    | (2.4   | )% |   |   | 0.9 | % |   |   | (5.0 | )% |
| Income tax benefit (expense)                      |   |                    | (0.0   | )% |   |   | (0.0 | )% |   |   | 0.8 | % |
| Income (loss) from continuing operations          |   |                    | (2.4   | )% |   |   | 0.9 | % |   |   | (4.2 | )% |
| Income (loss) from discontinued operations        |   |                    | (0.1   | )% |   |   | (0.1 | )% |   |   | 1.5 | % |
| Net income (loss)                                 |   |                    | (2.5   | )% |   |   | 0.8 | % |   |   | (2.7 | )% |

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|                     |   | (U.S. Dollars in Thousands) |    |
|--------------------------|--------|-----------------------------|---------|
|                     |   | Year ended December 31,     |    |
|                     |   | 2015                        |    |   | 2014 |   |   | 2013 |   |
| United States of America |   | $                           | 41,817  |   |   | $ | 39,983 |   |   | $ | 41,565 |   |
| Netherlands              |   |                        | 72,231  |   |   |   | 69,667 |   |   |   | 56,631 |   |
| Germany                  |   |                        | 61,765  |   |   |   | 49,771 |   |   |   | 13,002 |   |
| Other                    |   |                        | 11,209  |   |   |   | 13,508 |   |   |   | 13,299 |   |
| Total                    |   | $                           | 187,022 |   |   | $ | 172,929 |   |   | $ | 124,497 |   |

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|                                               |   |      |   |   | Airport   |   |    |       |   |   |   |   |
|----------------------------------------------------|--------|-----------|--------|--------|-----------|--------|---------|------------|--------|--------|--------|--------|
|                                               |   |      |   |   | Security  |   |    |       |   |   |   |   |
|                                               |   |      |   |   | and Other |   |    |       |   |   |   |   |
|                                               |   |      |   |   | Aviation  |   |    |       |   |   |   |   |
|                                               |   | Corporate |   |   | Services  |   |    | Technology |   |   | Total  |   |
| Year ended December 31, 2015:                      |   |      |   |   |      |   |    |       |   |   |   |   |
|  Revenue                                      |   | $         | -      |   |      | $      | 185,519 |       |   | $      | 1,503  |   |   | $ | 187,022 |   |
|  Depreciation and amortization                |   |      | 1      |   |      |   | 655     |       |   |   | 57     |   |   |   | 713 |   |
|  Income (loss) from continuing operations     |   |      | (3,182 | )      |      |   | 1,597   |       |   |   | (3,117 | )      |   |   | (4,702 | ) |
|  Total assets from continuing operations |   |      | 440    |   |      |   | 41,056  |       |   |   | 853    |   |   |   | 42,349 |   |
|                                               |   |      |   |   |      |   |    |       |   |   |   |   |   |   |   |   |
| Year ended December 31, 2014:                      |   |      |   |   |      |   |    |       |   |   |   |   |   |   |   |   |
|  Revenue                                      |   | $         | -      |   |      | $      | 172,102 |       |   | $      | 827    |   |   | $ | 172,929 |   |
|  Depreciation and amortization                |   |      | 3      |   |      |   | 689     |       |   |   | 69     |   |   |   | 761 |   |
|  Income (loss) from continuing operations     |   |      | (99    | )      |      |   | 5,106   |       |   |   | (3,467 | )      |   |   | 1,540 |   |
|  Total assets from continuing operations      |   |      | 404    |   |      |   | 34,006  |       |   |   | 461    |   |   |   | 34,871 |   |
|                                               |   |      |   |   |      |   |    |       |   |   |   |   |   |   |   |   |
| Year ended December 31, 2013:                      |   |      |   |   |      |   |    |       |   |   |   |   |   |   |   |   |
|  Revenue                                      |   | $         | -      |   |      | $      | 124,130 |       |   | $      | 367    |   |   | $ | 124,497 |   |
|  Depreciation and amortization                |   |      | 2      |   |      |   | 671     |       |   |   | 91     |   |   |   | 764 |   |
|  Income (Loss) from continuing operations     |   |      | (3,938 | )      |      |   | 2,373   |       |   |   | (3,689 | )      |   |   | (5,254 | ) |
| Total assets from continuing operations            |   |      | 447    |   |      |   | 27,720  |       |   |   | 488    |   |   |   | 28,655 |   |

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| Contractual Obligations                  |   | Payments due by Period (U.S. Dollars in Thousands) |   |
|------------------------------------------|--------|----------------------------------------------------|--------|
|                                     |   |                                               |   |   | Less than |   |   | 1-3 |   |   | 4-5 |   |   | more than |   |
|                                     |   | Total                                              |   |   | 1 year |   |   | years |   |   | years |   |   | 5 years |   |
| Line of credit in the U.S.               |   | $                                                  | 5,569  |   |   | $ | 5,569 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
| Consulting agreements                    |   |                                               | 1,063  |   |   |   | 218 |   |   |   | 518 |   |   |   | 327 |   |   |   | - |   |
| Lines of credit in Europe                |   |                                               | 5,840  |   |   |   | 5,840 |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Convertible notes payable -              |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  related party (including interest) |   |                                               | 39,402 |   |   |   | - |   |   |   | 39,402 |   |   |   | - |   |   |   | - |   |
| Operating lease obligations              |   |                                               | 2,761  |   |   |   | 1,356 |   |   |   | 1,093 |   |   |   | 312 |   |   |   | - |   |
| Future interest and fees on line of      |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   credit and convertible notes |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   payable to related party (1) |   |                                               | 9,303  |   |   |   | - |   |   |   | 9,303 |   |   |   | - |   |   |   | - |   |
|                                     |   | $                                                  | 63,938 |   |   | $ | 12,983 |   |   | $ | 50,316 |   |   | $ | 639 |   |   | $ | - |   |

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| Contractual Obligations |   | Payments due by Period (U.S. Dollars in Thousands) |   |
|-------------------------|--------|----------------------------------------------------|--------|
|                    |   |                                               |   |   | Less than |   |   | 1-3 |   |   | 4-5 |   |   | more than |   |
|                    |   | Total                                              |   |   | 1 year |   |   | years |   |   | years |   |   | 5 years |   |
|                    |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Guarantees              |   | $                                                  | 290    |   |   | $ | 290 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
| Letters of credit       |   |                                               | 274    |   |   |   | 274 |   |   |   | - |   |   |   | - |   |   |   | - |   |
|                    |   | $                                                  | 564    |   |   | $ | 564 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |

| Item 6. | Directors, Senior Management and Employees |
|---------|--------------------------------------------|

|              |   | Age |   | Position                                                                                                  |
|-------------------|--------|-----|--------|-----------------------------------------------------------------------------------------------------------|
| Menachem Atzmon   |   | 71  |   | Chairman of the Supervisory Board                                                                         |
| David W. Sass     |   | 80  |   | Member of the Supervisory Board                                                                           |
| Gail F. Lieberman |   | 72  |   | Member of the Supervisory Board, Member of the Audit Committee and Chairman of the Compensation Committee |
| Gordon Hausmann   |   | 70  |   | Member of the Supervisory Board, Member of the Compensation Committee and Member of the Audit Committee   |
| Philip M. Getter  |   | 79  |   | Member of the Supervisory Board, Chairman of the Audit Committee                                          |
| Ran Langer        |   | 70  |   | Managing Director                                                                                         |
| Alon Raich        |   | 40  |   | Chief Financial Officer                                                                                   |

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|            |   |   |   |   |   |   |   |   |   |          |   |   | Non-equity   |   |   | Nonqualified |   |   | Number |   |   | Number |   |   |   |   |
|-----------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|---------------|--------|--------|--------------|--------|--------|--------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|            |   |   |   |   |   |   |   |   |   |          |   |   | Incentive    |   |   | Deferred     |   |   | of     |   |   | of     |   |   |   |   |
| Principal       |   |   |   |   |   |   |   |   |   | All Other     |   |   | Plan         |   |   | Compensation |   |   | Option |   |   | Stock  |   |   |   |   |
| Position        |   | Year   |   | Salary |   |   | Bonus  |   |   | Compensations |   |   | Compensation |   |   | Earnings     |   |   | Awards |   |   | Awards |   |   | Total  |   |
|            |   |   |   | $      |   |   | $      |   |   | $             |   |   | $            |   |   | $            |   |   |   |   |   |   |   |   | $      |   |
| Managing        |   | 2015   |   |   | 222    |   |   |   | 1,110  |          |   |   | 21           |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | 1,353 |   |
| Director        |   | 2014   |   |   | 191    |   |   |   | 0      |          |   |   | 21           |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | 212 |   |
| (a)             |   | 2013   |   |   | 70     |   |   |   | 33     |          |   |   | 9            |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | 112 |   |
| Managing        |   | 2015   |   |   | -      |   |   |   | -      |          |   |   | -            |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | - |   |
| Director        |   | 2014   |   |   | -      |   |   |   | -      |          |   |   | 48           |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | 48 |   |
|            |   | 2013   |   |   | -      |   |   |   | -      |          |   |   | 58           |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | 58 |   |
| General Manager |   | 2015   |   |   | 128    |   |   |   | 73     |          |   |   | 22           |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | 223 |   |
| of a subsidiary |   | 2014   |   |   | 153    |   |   |   | 80     |          |   |   | 26           |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | 259 |   |
| (b)             |   | 2013   |   |   | 146    |   |   |   | 0      |          |   |   | 26           |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | 172 |   |
| General Manager |   | 2015   |   |   | -      |   |   |   | -      |          |   |   | -            |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | - |   |
| of a subsidiary |   | 2014   |   |   | -      |   |   |   | -      |          |   |   | -            |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   | - |   |   |   | - |   |
| (c)             |   | 2013   |   |   | 267    |   |   |   | 148    |          |   |   | 46           |   |   |         | -      |   |   |   | -      |   |   |   | -      |   |   |   |   |   |   |   | 461 |   |

| a. Highest paid employee in 2015 |   |   |   |   |   |   |   |
|----------------------------------|--------|--------|--------|--------|--------|--------|--------|
| b. Highest paid employee in 2014 |   |   |   |   |   |   |   |
| c. Highest paid employee in 2013 |   |   |   |   |   |   |   |

----

|                               |   | Salaries, fees, |   |   | Pension, retirement |   |
|------------------------------------|--------|-----------------|--------|--------|---------------------|--------|
|                               |   | commissions     |   |   | and other           |   |
|                               |   | and bonuses     |   |   | similar benefits    |   |
|                               |   | (in thousands)  |   |
|                               |   |            |   |   |                |   |
| Directors as a group (5 persons)   |   | $               | 752    |   |                | $      | - |   |
| All officers as a group(4 persons) |   | $               | 2,308  |   |                | $      | 85 |   |

----

----

----

----

----

| Item 7. | Major Shareholders and Related Party Transactions |
|---------|---------------------------------------------------|

|                                            |   | Percent of          |   |   |            |   |
|-------------------------------------------------|--------|---------------------|--------|--------|-----------------|--------|
|                                            |   | Amount Beneficially |   |   | Common Shares   |   |
| Name Shareholders Holding Five Percent or More  |   | Owned (a)           |   |   | Outstanding (b) |   |
|                                            |   |                |   |   |            |   |
| MacPherson Trust (c)                            |   |                | 44.2   | %      |            |   | 4,847,226 |   |
| Menachem J. Atzmon                              |   |                | 13.7   | %      |            |   | 1,500,000 |   |
| Igal Tavori                                     |   |                | 11.0   | %      |            |   | 1,202,483 |   |
| Amos Megides                                    |   |                | 9.4    | %      |            |   | 1,025,692 |   |
| All officers and directors as a group including |   |                |   |   |            |   |   |   |
| the MacPherson Trust (10 persons)               |   |                | 71.9   | %      |            |   | 7,833,272 |   |

----

----

| Item 8. | Financial Information |
|---------|-----------------------|

----

----

| Item 9. | The Offer and Listing |
|---------|-----------------------|

| Year |   | High |   |   | Low    |   |
|------|--------|------|--------|--------|--------|--------|
| 2011 |   | $    | 1.50   |   |   | $      | 0.40 |   |
| 2112 |   | $    | 1.60   |   |   | $      | 0.04 |   |
| 2013 |   | $    | 1.39   |   |   | $      | 0.45 |   |
| 2014 |   | $    | 2.39   |   |   | $      | 0.75 |   |
| 2015 |   | $    | 0.85   |   |   | $      | 0.51 |   |

| 2015           |   | High   |   |   | Low    |   |
|----------------|--------|--------|--------|--------|--------|--------|
| First quarter  |   | $      | 0.85   |   |   | $      | 0.59 |   |
| Second quarter |   | $      | 0.73   |   |   | $      | 0.55 |   |
| Third Quarter  |   | $      | 0.79   |   |   | $      | 0.56 |   |
| Fourth Quarter |   | $      | 0.60   |   |   | $      | 0.51 |   |
|           |   |   |   |   |   |   |   |   |
| 2014           |   | High   |   |   | Low    |   |
| First quarter  |   | $      | 0.90   |   |   | $      | 0.75 |   |
| Second quarter |   | $      | 2.39   |   |   | $      | 0.87 |   |
| Third Quarter  |   | $      | 1.30   |   |   | $      | 0.96 |   |
| Fourth Quarter |   | $      | 1.20   |   |   | $      | 0.85 |   |
|           |   |   |   |   |   |   |   |   |
| 2013           |   | High   |   |   | Low    |   |
| First quarter  |   | $      | 0.70   |   |   | $      | 0.45 |   |
| Second quarter |   | $      | 1.38   |   |   | $      | 0.45 |   |
| Third Quarter  |   | $      | 1.37   |   |   | $      | 1.05 |   |
| Fourth Quarter |   | $      | 1.39   |   |   | $      | 0.75 |   |

----

| Item 10. | Additional Information |
|----------|------------------------|

----

----

----

----

----

|  | · | any “excess distribution” that the U.S. Holder receives on shares, and |
|--|--------|------------------------------------------------------------------------------------|

|  | · | any gain the U.S. Holder realizes from a sale or other disposition (including a pledge) of the shares. |
|--|--------|--------------------------------------------------------------------------------------------------------|

|  | · | the excess distribution or gain will be allocated ratably over the U.S. Holder’s holding period for the shares, |
|--|--------|-----------------------------------------------------------------------------------------------------------------------|

|  | · | the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which the Company was a PFIC, will be treated as ordinary income, and |
|--|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | · | the amount allocated to each other year will be subject to tax at the highest tax rate in effect for that year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year. |
|--|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

----

----

----

| Item 11. | Quantitative and Qualitative Disclosure About Market Risk |
|----------|-----------------------------------------------------------|

| Item 12. | Description of Securities Other than Equity Securities |
|----------|--------------------------------------------------------|

| Item 13. | Defaults, Dividend Arrearages and Delinquencies |
|----------|-------------------------------------------------|

| Item 14. | Material Modifications to the Rights of Security Holders and Use of Proceeds |
|----------|------------------------------------------------------------------------------|

----

| Item 15. | Controls and Procedures |
|----------|-------------------------|

| Item 16A. | Audit Committee Financial Experts |
|-----------|-----------------------------------|

| Item 16B. | Code of Ethics |
|-----------|----------------|

----

| Item 16C. | Fees Paid to Our Independent Registered Public Accounting Firm |
|-----------|----------------------------------------------------------------|

|               |   | 2015   |   |   | 2014   |   |
|--------------------|--------|--------|--------|--------|--------|--------|
| Audit fees         |   | $      | 205    |   |   | $      | 210 |   |
| Audit related fees |   |   | -      |   |   |   | - |   |
| Tax fees           |   |   | -      |   |   |   | - |   |
| Total fees         |   | $      | 205    |   |   | $      | 210 |   |

| Item 16D. | Purchase of Equity Securities by the Issuer and Affiliated Purchasers |
|-----------|-----------------------------------------------------------------------|

| Item 16E. | Change in Accountants Disclosure |
|-----------|----------------------------------|

| Item 16F. | Corporate Governance. |
|-----------|-----------------------|

| Item 17. | Financial Statements |
|----------|----------------------|

----

| Item 18. | Financial Statements |
|----------|----------------------|

| Item 19. | Exhibits |
|----------|----------|

| * | Incorporated by reference to the Company's 1999 annual report filed with the Commission on Form 20-F. |
|---|-------------------------------------------------------------------------------------------------------|

| ** | Incorporated by reference to the Company's 2003 annual report filed with the Commission on Form 20-F. |
|----|-------------------------------------------------------------------------------------------------------|

----

| ICTS INTERNATIONAL N.V. AND SUBSIDIARIES |              |
|------------------------------------------|-------------------|
|                                     |              |   |
| By:                                      | /s/ Ran Langer    |   |
| Name:                                    | Ran Langer        |   |
| Title:                                   | Managing Director |   |

| Date: | November 1, 2016 |
|-------|------------------|

----

| Consolidated Financial Statements: |                                                                                                                       |
|------------------------------------|----------------------------------------------------------------------------------------------------------------------------|
|                               |                                                                                                                       |   |
|                               | Report of Independent Registered Public Accounting Firm                                                                    | F-2 |
|                               |                                                                                                                       |   |
|                               | Consolidated Balance Sheets as of December 31, 2015 and 2014                                                               | F-3 |
|                               |                                                                                                                       |   |
|                               | Consolidated Statements of Operations and Comprehensive Income (Loss) for the Years Ended December 31, 2015, 2014 and 2013 | F-4 |
|                               |                                                                                                                       |   |
|                               | Consolidated Statements of Shareholders' Deficit for the Years Ended December 31, 2015, 2014 and 2013                      | F-5 |
|                               |                                                                                                                       |   |
|                               | Consolidated Statements of Cash Flows for the Years Ended December 31, 2015, 2014 and 2013                            | F-6 |
|                               |                                                                                                                       |   |
|                               | Notes to Consolidated Financial Statements                                                                                 | F-8 |
|                               |                                                                                                                       |   |
| Financial Statement Schedule:      |                                                                                                                       |
|                               |                                                                                                                       |   |
|                               | Valuation and Qualifying Accounts                                                                                          | F-33 |

----

DEPE

----

D

|                                                             |   | December 31, |    |
|------------------------------------------------------------------|--------|--------------|---------|
| ASSETS                                                           |   | 2015         |    |   | 2014 |   |
| CURRENT ASSETS:                                                  |   |         |    |   |   |   |
|   Cash and cash equivalents                                 |   | $            | 7,912   |   |   | $ | 5,973 |   |
|   Restricted cash                                           |   |         | 4,388   |   |   |   | 4,759 |   |
|   Accounts receivable, net                                  |   |         | 25,715  |   |   |   | 20,991 |   |
|   Prepaid expenses and other current assets                 |   |         | 1,987   |   |   |   | 1,036 |   |
|   Current assets from discontinued operations               |   |         | -       |   |   |   | 134 |   |
|     Total current assets                     |   |         | 40,002  |   |   |   | 32,893 |   |
|                                                             |   |         |    |   |   |   |   |   |
| Deferred tax assets, net                                         |   |         | 92      |   |   |   | 131 |   |
| Property and equipment, net                                      |   |         | 1,493   |   |   |   | 1,257 |   |
| Goodwill                                                         |   |         | 314     |   |   |   | 314 |   |
| Other assets                                                     |   |         | 448     |   |   |   | 410 |   |
| Total assets                                                     |   | $            | 42,349  |   |   | $ | 35,005 |   |
|                                                             |   |         |    |   |   |   |   |   |
| LIABILITIES AND SHAREHOLDERS' DEFICIT                            |   |         |    |   |   |   |   |   |
| CURRENT LIABILITIES:                                             |   |         |    |   |   |   |   |   |
|   Notes payable-banks                                       |   | $            | 11,412  |   |   | $ | 10,022 |   |
|   Accounts payable                                          |   |         | 3,079   |   |   |   | 2,786 |   |
|   Accrued expenses and other current liabilities            |   |         | 25,065  |   |   |   | 17,086 |   |
|   Income taxes payable                                      |   |         | 89      |   |   |   | 53 |   |
|   Value added tax (VAT) payable                             |   |         | 5,362   |   |   |   | 5,430 |   |
| Current liabilities from discontinued operations                 |   |         | -       |   |   |   | 102 |   |
|     Total current liabilities                |   |         | 45,007  |   |   |   | 35,479 |   |
|                                                             |   |         |    |   |   |   |   |   |
| Convertible notes payable to a related party, including          |   |         |    |   |   |   |   |   |
|   accrued interest                                          |   |         | 39,403  |   |   |   | 38,504 |   |
| Other liabilities                                                |   |         | 147     |   |   |   | 81 |   |
| Total liabilities                                                |   |         | 84,557  |   |   |   | 74,064 |   |
|                                                             |   |         |    |   |   |   |   |   |
| COMMITMENTS AND CONTINGENCIES (NOTES 11 and 14)                  |   |         |    |   |   |   |   |   |
| SHAREHOLDERS' DEFICIT:                                           |   |         |    |   |   |   |   |   |
|   Common stock, €0.45 par value;                 |   |         |    |   |   |   |   |   |
|   33,333,334 shares authorized as of December 31,      |   |         |    |   |   |   |   |   |
|    2015 and 2014; 10,961,698 and 8,061,698 shares |   |         |    |   |   |   |   |   |
|    issued and outstanding as of December 31, 2015 |   |         |    |   |   |   |   |   |
|    and 2014, respectively                         |   |         | 5,928   |   |   |   | 4,507 |   |
|   Additional paid-in capital                           |   |         | 21,267  |   |   |   | 20,949 |   |
|   Accumulated deficit                                  |   |         | (61,896 | ) |   |   | (57,194 | ) |
|   Accumulated other comprehensive loss                 |   |         | (7,507  | ) |   |   | (7,321 | ) |
| Total shareholders' deficit                                      |   |         | (42,208 | ) |   |   | (39,059 | ) |
| Total liabilities and shareholders' deficit                      |   | $            | 42,349  |   |   | $ | 35,005 |   |

|                See accompanying notes to the consolidated financial statements. |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

COMPREHENSIVE INCOME 

|                                                         |   | For the Years Ended December 31, |      |
|--------------------------------------------------------------|--------|----------------------------------|-----------|
|                                                         |   | 2015                             |      |   | 2014 |   |   | 2013 |   |
|                                                         |   |                             |      |   |   |   |   |   |   |
| Revenue                                                      |   | $                                | 187,022   |   |   | $ | 172,929 |   |   | $ | 124,497 |   |
| Cost of revenue                                              |   |                             | 167,844   |   |   |   | 152,224 |   |   |   | 108,995 |   |
| GROSS PROFIT                                                 |   |                             | 19,178    |   |   |   | 20,705 |   |   |   | 15,502 |   |
| Operating expenses:                                          |   |                             |      |   |   |   |   |   |   |   |   |   |
|   Research and development                              |   |                             | 2,565     |   |   |   | 2,207 |   |   |   | 2,182 |   |
|   Selling, general, and administrative                  |   |                             | 20,406    |   |   |   | 17,316 |   |   |   | 16,925 |   |
| Forgiveness of debt                                          |   |                             | -         |   |   |   | - |   |   |   | (1,312 | ) |
| Total operating expenses                                     |   |                             | 22,971    |   |   |   | 19,523 |   |   |   | 17,795 |   |
| OPERATING INCOME (LOSS)                                      |   |                             | (3,793    | ) |   |   | 1,182 |   |   |   | (2,293 | ) |
| Other income (expense), net                                  |   |                             | (760      | ) |   |   | 448 |   |   |   | (3,987 | ) |
| INCOME (LOSS) BEFORE  INCOME TAX BENEFIT (EXPENSE) |   |                             | (4,553    | ) |   |   | 1,630 |   |   |   | (6,280 | ) |
| Income tax benefit (expense)                                 |   |                             | (149      | ) |   |   | (90 | ) |   |   | 1,026 |   |
| INCOME (LOSS) FROM CONTINUING OPERATIONS                     |   |                             | (4,702    | ) |   |   | 1,540 |   |   |   | (5,254 | ) |
| Income (loss) from discontinued operations,                  |   |                             |      |   |   |   |   |   |   |   |   |   |
|    net of income tax benefit (expense) of          |   |                             |      |   |   |   |   |   |   |   |   |   |
| $0, $0 and $1,221 in 2015, 2014 and                          |   |                             |      |   |   |   |   |   |   |   |   |   |
| 2013, respectively                                           |   |                             | -         |   |   |   | (109 | ) |   |   | 1,821 |   |
| NET INCOME (LOSS)                                            |   | $                                | (4,702    | ) |   | $ | 1,431 |   |   | $ | (3,433 | ) |
|                                                         |   |                             |      |   |   |   |   |   |   |   |   |   |
| INCOME (LOSS) PER SHARE - BASIC AND DILUTED                  |   |                             |      |   |   |   |   |   |   |   |   |   |
| Continuing operations                                        |   | $                                | (0.58     | ) |   | $ | 0.19 |   |   | $ | (0.66 | ) |
| Discontinued operations                                      |   |                             | -         |   |   |   | (0.01 | ) |   |   | 0.23 |   |
| Net income (loss)                                            |   | $                                | (0.58     | ) |   | $ | 0.18 |   |   | $ | (0.43 | ) |
|                                                         |   |                             |      |   |   |   |   |   |   |   |   |   |
| Weighted average number of shares outstanding                |   |                             | 8,085,599 |   |   |   | 8,054,390 |   |   |   | 8,036,780 |   |
|                                                         |   |                             |      |   |   |   |   |   |   |   |   |   |
| COMPREHENSIVE INCOME (LOSS)                                  |   |                             |      |   |   |   |   |   |   |   |   |   |
| Net income (loss)                                            |   | $                                | (4,702    | ) |   | $ | 1,431 |   |   | $ | (3,433 | ) |
| Translation adjustment                                       |   |                             | (186      | ) |   |   | (168 | ) |   |   | (276 | ) |
| Comprehensive income (loss)                                  |   | $                                | (4,888    | ) |   | $ | 1,263 |   |   | $ | (3,709 | ) |

----

DE

|                                    |   |         |       |   |    |   |   |        |   |   |          |   |   | Accumulated   |    |   |    |   |
|-----------------------------------------|--------|--------------|------------|--------|---------|--------|--------|-------------|--------|--------|---------------|--------|--------|---------------|---------|--------|---------|--------|
|                                    |   |         |       |   |    |   |   | Additional  |   |   |          |   |   | Other         |    |   | Total   |   |
|                                    |   | Common Stock |       |   | Paid-In |   |   | Accumulated |   |   | Comprehensive |   |   | Shareholders' |    |
|                                    |   | Shares       |       |   | Amount  |   |   | Capital     |   |   | Deficit       |   |   | Loss          |    |   | Deficit |   |
| BALANCE AT DECEMBER 31, 2012            |   |         | 8,036,698  |   |    | $      | 4,492  |        |   | $      | 20,891        |   |   | $             | (55,192 | )      |    | $      | (6,877 | ) |   | $ | (36,686 | ) |
| Exercise of stock options               |   |         | 5,000      |   |    |   | 3      |        |   |   | (3            | )      |   |          | -       |   |    |   | - |   |   |   | - |   |
| Stock based compensation                |   |         | -          |   |    |   | -      |        |   |   | 39            |   |   |          | -       |   |    |   | - |   |   |   | 39 |   |
| Net loss                                |   |         | -          |   |    |   | -      |        |   |   | -             |   |   |          | (3,433  | )      |    |   | - |   |   |   | (3,433 | ) |
| Translation adjustment                  |   |         | -          |   |    |   | -      |        |   |   | -             |   |   |          | -       |   |    |   | (276 | ) |   |   | (276 | ) |
|                                    |   |         |       |   |    |   |   |        |   |   |          |   |   |          |    |   |    |   |   |   |   |   |   |   |
| BALANCE AT DECEMBER  31, 2013 |   |         | 8,041,698  |   |    |   | 4,495  |        |   |   | 20,927        |   |   |          | (58,625 | )      |    |   | (7,153 | ) |   |   | (40,356 | ) |
| Issuance of common stock                |   |         | 20,000     |   |    |   | 12     |        |   |   | 8             |   |   |          | -       |   |    |   | - |   |   |   | 20 |   |
| Stock based compensation                |   |         | -          |   |    |   | -      |        |   |   | 14            |   |   |          | -       |   |    |   | - |   |   |   | 14 |   |
| Net income                              |   |         | -          |   |    |   | -      |        |   |   | -             |   |   |          | 1,431   |   |    |   | - |   |   |   | 1,431 |   |
| Translation adjustment                  |   |         | -          |   |    |   | -      |        |   |   | -             |   |   |          | -       |   |    |   | (168 | ) |   |   | (168 | ) |
|                                    |   |         |       |   |    |   |   |        |   |   |          |   |   |          |    |   |    |   |   |   |   |   |   |   |
| BALANCE AT DECEMBER 31, 2014            |   |         | 8,061,698  |   |    |   | 4,507  |        |   |   | 20,949        |   |   |          | (57,194 | )      |    |   | (7,321 | ) |   |   | (39,059 | ) |
| Issuance of common stock                |   |         | 2,900,000  |   |    |   | 1,421  |        |   |   | 318           |   |   |          | -       |   |    |   | - |   |   |   | 1,739 |   |
| Net income                              |   |         | -          |   |    |   | -      |        |   |   | -             |   |   |          | (4,702  | )      |    |   | - |   |   |   | (4,702 | ) |
| Translation adjustment                  |   |         | -          |   |    |   | -      |        |   |   | -             |   |   |          | -       |   |    |   | (186 | ) |   |   | (186 | ) |
|                                    |   |         |       |   |    |   |   |        |   |   |          |   |   |          |    |   |    |   |   |   |   |   |   |   |
| BALANCE AT DECEMBER 31, 2015            |   |         | 10,961,698 |   |    | $      | 5,928  |        |   | $      | 21,267        |   |   | $             | (61,896 | )      |    | $      | (7,507 | ) |   | $ | (42,208 | ) |

| See accompanying notes to the consolidated financial statements. |
|------------------------------------------------------------------|

----

OF 

|                                                              |   | Year Ended December 31, |   |
|-------------------------------------------------------------------|--------|-------------------------|--------|
|                                                              |   | 2015                    |   |   | 2014 |   |   | 2013 |   |
| CASH FLOWS FROM OPERATING ACTIVITIES:                             |   |                    |   |   |   |   |   |   |   |
| Net income (loss)                                                 |   | $                       | (4,702 | ) |   | $ | 1,431 |   |   | $ | (3,433 | ) |
| Income (loss) from discontinued operations                        |   |                    | -      |   |   |   | (109 | ) |   |   | 1,821 |   |
|                                                              |   |                    |   |   |   |   |   |   |   |   |   |   |
| Income (loss) from continuing operations                          |   |                    | (4,702 | ) |   |   | 1,540 |   |   |   | (5,254 | ) |
| Adjustments to reconcile net income (loss) to net                 |   |                    |   |   |   |   |   |   |   |   |   |   |
|  cash provided by (used in) operating activities:            |   |                    |   |   |   |   |   |   |   |   |   |   |
|   Depreciation and amortization                              |   |                    | 713    |   |   |   | 761 |   |   |   | 764 |   |
| Amortization of deferred financing costs                          |   |                    | -      |   |   |   | - |   |   |   | 123 |   |
| Gain on the sale of property and equipment                        |   |                    | -      |   |   |   | (10 | ) |   |   | (29 | ) |
| Forgiveness of debt                                               |   |                    | -      |   |   |   | - |   |   |   | (1,312 | ) |
|   Bad debt expense (income)                                  |   |                    | (43    | ) |   |   | 30 |   |   |   | 30 |   |
|   Deferred income taxes                                      |   |                    | 26     |   |   |   | (30 | ) |   |   | 38 |   |
|   Stock-based compensation                                   |   |                    | -      |   |   |   | 14 |   |   |   | 39 |   |
|   Stock issued for services                                  |   |                    | -      |   |   |   | 20 |   |   |   | - |   |
|   Changes in assets and liabilities:                         |   |                    |   |   |   |   |   |   |   |   |   |   |
|     Accounts receivable, net                       |   |                    | (6,279 | ) |   |   | (6,926 | ) |   |   | (3,452 | ) |
|     Prepaid expenses and other current assets      |   |                    | (1,020 | ) |   |   | (72 | ) |   |   | (122 | ) |
|     Other assets                                   |   |                    | (15    | ) |   |   | 16 |   |   |   | (20 | ) |
|     Accounts payable                               |   |                    | 463    |   |   |   | 659 |   |   |   | (272 | ) |
|     Accrued expenses and other current liabilities |   |                    | 9,102  |   |   |   | 5,354 |   |   |   | 2,774 |   |
|     VAT Payable                                    |   |                    | 491    |   |   |   | 1,242 |   |   |   | 450 |   |
|     Income taxes payable                           |   |                    | 40     |   |   |   | (3 | ) |   |   | (1,659 | ) |
|     Liability to United States Department of Labor |   |                    | -      |   |   |   | (259 | ) |   |   | (323 | ) |
|     Other liabilities                              |   |                    | 66     |   |   |   | (406 | ) |   |   | 470 |   |
|     Net cash provided by (used in) in discontinued |   |                    |   |   |   |   |   |   |   |   |   |   |
| operations                                                        |   |                    | 27     |   |   |   | (124 | ) |   |   | 65 |   |
|                                                              |   |                    |   |   |   |   |   |   |   |   |   |   |
| Net cash provided by (used in) operating activities               |   |                    | (1,131 | ) |   |   | 1,806 |   |   |   | (7,690 | ) |
|                                                              |   |                    |   |   |   |   |   |   |   |   |   |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:                             |   |                    |   |   |   |   |   |   |   |   |   |   |
|   Purchase of property and equipment                    |   |                    | (1,037 | ) |   |   | (645 | ) |   |   | (699 | ) |
|   Proceeds from sale of property and equipment          |   |                    | -      |   |   |   | 9 |   |   |   | 95 |   |
|   Change in restricted cash                             |   |                    | (91    | ) |   |   | 1,859 |   |   |   | (1,515 | ) |
|                                                              |   |                    |   |   |   |   |   |   |   |   |   |   |
| Net cash provided by (used in) investing activities               |   | $                       | (1,128 | ) |   | $ | 1,223 |   |   | $ | (2,119 | ) |

----

|                                                                   |   | Year Ended December 31, |   |
|------------------------------------------------------------------------|--------|-------------------------|--------|
|                                                                   |   | 2015                    |   |   | 2014 |   |   | 2013 |   |
|                                                                   |   |                    |   |   |   |   |   |   |   |
| CASH FLOWS FROM FINANCING ACTIVITIES:                                  |   |                    |   |   |   |   |   |   |   |
| Borrowings (repayments) under lines of credit, net                     |   |                    | 1,877  |   |   |   | (2,194 | ) |   |   | 4,056 |   |
| Net proceeds from convertible notes payable                            |   |                    |   |   |   |   |   |   |   |   |   |   |
|   to a related party                                         |   |                    | 3,965  |   |   |   | 5,675 |   |   |   | 7,257 |   |
|   Proceeds from stock issuance                               |   |                    | 1,739  |   |   |   | - |   |   |   | - |   |
|   Increase (decrease) in cash overdraft                      |   |                    | 264    |   |   |   | 800 |   |   |   | (272 | ) |
|                                                                   |   |                    |   |   |   |   |   |   |   |   |   |   |
| Net cash provided by financing activities                              |   |                    | 7,845  |   |   |   | 4,281 |   |   |   | 11,041 |   |
|                                                                   |   |                    |   |   |   |   |   |   |   |   |   |   |
| EFFECT OF CHANGES IN FOREIGN CURRENCY EXCHANGE                         |   |                    |   |   |   |   |   |   |   |   |   |   |
|  RATES ON CASH AND CASH EQUIVALENTS                               |   |                    | (3,647 | ) |   |   | (4,471 | ) |   |   | 957 |   |
|                                                                   |   |                    |   |   |   |   |   |   |   |   |   |   |
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                       |   |                    | 1,939  |   |   |   | 2,839 |   |   |   | 2,189 |   |
|                                                                   |   |                    |   |   |   |   |   |   |   |   |   |   |
| CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR                           |   |                    | 5,973  |   |   |   | 3,134 |   |   |   | 945 |   |
|                                                                   |   |                    |   |   |   |   |   |   |   |   |   |   |
| CASH AND CASH EQUIVALENTS, END OF YEAR                                 |   | $                       | 7,912  |   |   | $ | 5,973 |   |   | $ | 3,134 |   |
|                                                                   |   |                    |   |   |   |   |   |   |   |   |   |   |
| SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES |   |                    |   |   |   |   |   |   |   |   |   |   |
|   Cashless exercise of stock options                         |   | $                       | -      |   |   | $ | - |   |   | $ | 3 |   |
|                                                                   |   |                    |   |   |   |   |   |   |   |   |   |   |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW ACTIVITIES                       |   |                    |   |   |   |   |   |   |   |   |   |   |
|  Cash paid during the year for:                                   |   |                    |   |   |   |   |   |   |   |   |   |   |
|  Interest                                                         |   | $                       | 543    |   |   | $ | 748 |   |   | $ | 635 |   |
|                                                                   |   |                    |   |   |   |   |   |   |   |   |   |   |
|  Income taxes                                                     |   | $                       | 305    |   |   | $ | 100 |   |   | $ | 218 |   |

----

A

----

|                     | Years |
|--------------------------|-------|
| Equipment and facilities | 3-7   |
| Internal-use software    | 7     |
| Vehicles                 | 3-7   |

----

----

----

|                                               |   | Year Ended December 31, |       |
|----------------------------------------------------|--------|-------------------------|------------|
|                                               |   | 2015                    |       |   | 2014 |   |   | 2013 |   |
|                                               |   |                    |       |   |   |   |   |   |   |
| Stock Options                                      |   |                    | 150,000    |   |   |   | 150,000 |   |   |   | 150,000 |   |
| Shares Issuable upon Conversion of                 |   |                    |       |   |   |   |   |   |   |   |   |   |
|  Convertible Notes Payable to a Related Party |   |                    | 33,171,710 |   |   |   | 25,669,039 |   |   |   | 24,379,883 |   |
| Total                                              |   |                    | 33,321,710 |   |   |   | 25,819,039 |   |   |   | 24,529,883 |   |

----

----

----

----

|                                                                |   | December 31, |   |
|---------------------------------------------------------------------|--------|--------------|--------|
|                                                                |   | 2015         |   |   | 2014 |   |
| ASSETS                                                              |   |         |   |   |   |   |
| CURRENT ASSETS:                                                     |   |         |   |   |   |   |
|  Cash and cash equivalents                                     |   | $            | -      |   |   | $ | 30 |   |
|  Accounts receivable, net                                      |   |         | -      |   |   |   | 104 |   |
|    Total current assets from discontinued operations |   | $            | -      |   |   | $ | 134 |   |
|                                                                |   |         |   |   |   |   |   |   |
| LIABILITIES                                                         |   |         |   |   |   |   |   |   |
| CURRENT LIABILITIES:                                                |   |         |   |   |   |   |   |   |
|  Accounts payable                                              |   | $            | -      |   |   | $ | 97 |   |
|  Accrued expenses and other current liabilities                |   |         | -      |   |   |   | 5 |   |
|   Total current liabilities from discontinued operations  |   | $            | -      |   |   | $ | 102 |   |

----

|                                         |   | Year Ended December 31, |   |
|----------------------------------------------|--------|-------------------------|--------|
|                                         |   | 2015                    |   |   | 2014 |   |   | 2013 |   |
|                                         |   |                    |   |   |   |   |   |   |   |
| Revenue                                      |   | $                       | 97     |   |   | $ | 1,152 |   |   | $ | 4,988 |   |
| Cost of revenue                              |   |                    | 94     |   |   |   | 1,132 |   |   |   | 4,275 |   |
| GROSS PROFIT                                 |   |                    | 3      |   |   |   | 20 |   |   |   | 713 |   |
| Selling, general and administrative expenses |   |                    | 6      |   |   |   | 114 |   |   |   | 729 |   |
| OPERATING LOSS                               |   |                    | (3     | ) |   |   | (94 | ) |   |   | (16 | ) |
| Other income (expense), net                  |   |                    | 3      |   |   |   | (15 | ) |   |   | 616 |   |
| Income tax benefit (expense)                 |   |                    | -      |   |   |   | - |   |   |   | 1,221 |   |
| Income (loss) from discontinued operations   |   | $                       | -      |   |   | $ | (109 | ) |   | $ | 1,821 |   |

|                                       |   | December 31, |   |
|--------------------------------------------|--------|--------------|--------|
|                                       |   | 2015         |   |   | 2014 |   |
|                                       |   |         |   |   |   |   |
| Current assets                             |   | $            | 706    |   |   | $ | 896 |   |
| Non-current assets                         |   |         | -      |   |   |   | - |   |
| Total assets                               |   | $            | 706    |   |   | $ | 896 |   |
|                                       |   |         |   |   |   |   |   |   |
| Current liabilities                        |   | $            | 50     |   |   | $ | 66 |   |
| Non-current liabilities                    |   |         | 5      |   |   |   | 60 |   |
| Stockholders' equity                       |   |         | 651    |   |   |   | 770 |   |
| Total liabilities and stockholders' equity |   | $            | 706    |   |   | $ | 896 |   |

----

|                   |   | Year Ended December 31, |   |
|------------------------|--------|-------------------------|--------|
|                   |   | 2015                    |   |   | 2014 |   |   | 2013 |   |
|                   |   |                    |   |   |   |   |   |   |   |
| Revenue                |   | $                       | -      |   |   | $ | 244 |   |   | $ | 1,288 |   |
| Gross profit           |   | $                       | -      |   |   | $ | 204 |   |   | $ | 724 |   |
| Gain on sale of assets |   | $                       | -      |   |   | $ | 754 |   |   | $ | - |   |
| Net income (loss)      |   | $                       | (139   | ) |   | $ | 342 |   |   | $ | (298 | ) |

|                                            |   | December 31, |   |
|-------------------------------------------------|--------|--------------|--------|
|                                            |   | 2015         |   |   | 2014 |   |
|                                            |   |         |   |   |   |   |
| Equipment and facilities                        |   | $            | 4,360  |   |   | $ | 3,896 |   |
| Internal-use software                           |   |         | 531    |   |   |   | 519 |   |
| Vehicles                                        |   |         | 1,031  |   |   |   | 910 |   |
| Leasehold improvements                          |   |         | 262    |   |   |   | 280 |   |
|                                            |   |         | 6,184  |   |   |   | 5,605 |   |
| Less: accumulated depreciation and amortization |   |         | 4,691  |   |   |   | 4,348 |   |
| Total property and equipment, net               |   | $            | 1,493  |   |   | $ | 1,257 |   |

----

----

----

|                                                 |   | December 31, |   |
|------------------------------------------------------|--------|--------------|--------|
|                                                 |   | 2015         |   |   | 2014 |   |
|                                                 |   |         |   |   |   |   |
| Accrued payroll and related costs                    |   | $            | 12,363 |   |   | $ | 8,719 |   |
| Accrued vacation                                     |   |         | 4,522  |   |   |   | 3,526 |   |
| Accrual for minimum wage increase                    |   |         | 3,284  |   |   |   | - |   |
| Cash overdraft                                       |   |         | 1,300  |   |   |   | 1,036 |   |
| Accrued agency fees                                  |   |         | -      |   |   |   | 413 |   |
| Labor union contribution                             |   |         | 920    |   |   |   | 730 |   |
| Other                                                |   |         | 2,676  |   |   |   | 2,662 |   |
| Total accrued expenses and other current liabilities |   | $            | 25,065 |   |   | $ | 17,086 |   |

----

----

|                                |   |   |    |   |     |   |   | Weighted    |   |   |      |   |
|-------------------------------------|--------|--------|---------|--------|----------|--------|--------|-------------|--------|--------|-----------|--------|
|                                |   |   |    |   |     |   |   | Average     |   |   |      |   |
|                                |   |   |    |   | Weighted |   |   | Remaining   |   |   |      |   |
|                                |   |   |    |   | Average  |   |   | Contractual |   |   |      |   |
|                                |   |   |    |   | Exercise |   |   | Term        |   |   | Intrinsic |   |
|                                |   | Number |    |   | Price    |   |   | (in years)  |   |   | Value     |   |
|                                |   |   |    |   |     |   |   |        |   |   |      |   |
| Outstanding as of January 1, 2015   |   |   | 150,000 |   |     | $      | 1.05   |        |   |   | 2.33      |   |   | $ | - |   |
| Granted                             |   |   | -       |   |     |   | -      |        |   |   | -         |   |   |   | - |   |
| Exercised                           |   |   | -       |   |     |   | -      |        |   |   | -         |   |   |   | - |   |
| Forfeited/Expired                   |   |   | -       |   |     |   | -      |        |   |   | -         |   |   |   | - |   |
| Outstanding as of December 31, 2015 |   |   | 150,000 |   |     | $      | 1.05   |        |   |   | 1.33      |   |   | $ | - |   |

|                                           |   | 2015   |   |   | 2014   |   |   | 2013   |   |
|------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                           |   |   |   |   |   |   |   |   |   |
| Interest expense to related party (see Note 8) |   | $      | (2,601 | )      |   | $      | (2,321 | )      |   | $ | (2,185 | ) |
| Interest income (expense) related to uncertain |   |   |   |   |   |   |   |   |   |   |   |   |
|  tax positions (see Note 11)              |   |   | -      |   |   |   | -      |   |   |   | 280 |   |
| Interest expense and other bank charges        |   |   | (1,374 | )      |   |   | (1,064 | )      |   |   | (1,063 | ) |
| Amortization of deferred financing costs       |   |   | -      |   |   |   | -      |   |   |   | (123 | ) |
| Interest income                                |   |   | 169    |   |   |   | 104    |   |   |   | 26 |   |
| Foreign currency gain (loss)                   |   |   | 3,066  |   |   |   | 3,749  |   |   |   | (951 | ) |
| Other income (expense)                         |   |   | (20    | )      |   |   | (20    | )      |   |   | 29 |   |
|  Total other income (expense), net        |   | $      | (760   | )      |   | $      | 448    |   |   | $ | (3,987 | ) |

----

|                                              |   | Year Ended December 31, |   |
|---------------------------------------------------|--------|-------------------------|--------|
|                                              |   | 2015                    |   |   | 2014 |   |   | 2013 |   |
|                                              |   |                    |   |   |   |   |   |   |   |
| The Netherlands                                   |   | $                       | (2,048 | ) |   | $ | 3,574 |   |   | $ | (4,662 | ) |
| Subsidiaries outside of the Netherlands           |   |                    | (2,505 | ) |   |   | (1,944 | ) |   |   | (1,618 | ) |
| Income (Loss) before income tax benefit (expense) |   | $                       | (4,553 | ) |   | $ | 1,630 |   |   | $ | (6,280 | ) |

|                                              |   | Year Ended December 31, |   |
|---------------------------------------------------|--------|-------------------------|--------|
|                                              |   | 2015                    |   |   | 2014 |   |   | 2013 |   |
|                                              |   |                    |   |   |   |   |   |   |   |
| Current:                                          |   |                    |   |   |   |   |   |   |   |
| The Netherlands                                   |   | $                       | -      |   |   | $ | - |   |   | $ | - |   |
| Subsidiaries outside of the Netherlands, net of   |   |                    |   |   |   |   |   |   |   |   |   |   |
| $0, $0 and $1,125 in income tax benefit (expense) |   |                    |   |   |   |   |   |   |   |   |   |   |
| related to prior period income tax positions      |   |                    |   |   |   |   |   |   |   |   |   |   |
| in 2015, 2014 and 2013, respectively              |   |                    | (110   | ) |   |   | (107 | ) |   |   | 1,057 |   |
|                                              |   |                    | (110   | ) |   |   | (107 | ) |   |   | 1,057 |   |
| Deferred:                                         |   |                    |   |   |   |   |   |   |   |   |   |   |
| The Netherlands                                   |   |                    | -      |   |   |   | - |   |   |   | - |   |
| Subsidiaries outside of the Netherlands           |   |                    | (39    | ) |   |   | 17 |   |   |   | (31 | ) |
| Total income tax benefit (expense)                |   | $                       | (149   | ) |   | $ | (90 | ) |   | $ | 1,026 |   |

----

|                                   |   | December 31, |    |
|----------------------------------------|--------|--------------|---------|
|                                   |   | 2015         |    |   | 2014 |   |
|                                   |   |         |    |   |   |   |
| Deferred tax assets:                   |   |         |    |   |   |   |
| Operating loss carryforwards           |   | $            | 19,890  |   |   | $ | 18,234 |   |
| Capital loss carryforwards             |   |         | 143     |   |   |   | 143 |   |
| Allowance for doubtful accounts        |   |         | 21      |   |   |   | 36 |   |
| Tax credit carryforwards               |   |         | 568     |   |   |   | 571 |   |
| Accrued expenses                       |   |         | 1,669   |   |   |   | 509 |   |
| Total deferred tax assets              |   |         | 22,291  |   |   |   | 19,493 |   |
|                                   |   |         |    |   |   |   |   |   |
| Deferred tax liabilities:              |   |         |    |   |   |   |   |   |
| Depreciation of property and equipment |   |         | (56     | ) |   |   | (87 | ) |
|                                   |   |         | 22,235  |   |   |   | 19,406 |   |
| Valuation allowance                    |   |         | (22,143 | ) |   |   | (19,275 | ) |
| Deferred tax assets, net               |   | $            | 92      |   |   | $ | 131 |   |

----

|                                                |   | Year Ended December 31, |   |
|-----------------------------------------------------|--------|-------------------------|--------|
|                                                |   | 2015                    |   |   | 2014 |   |   | 2013 |   |
|                                                |   |                    |   |   |   |   |   |   |   |
| Effective loss (income) tax benefit from continuing |   |                    |   |   |   |   |   |   |   |
|  operations at statutory rate                  |   | $                       | 1,138  |   |   | $ | (408 | ) |   | $ | 1,578 |   |
| Rate differential                                   |   |                    | 334    |   |   |   | 104 |   |   |   | (6 | ) |
| Non-deductible income (expense)                     |   |                    | (162   | ) |   |   | (46 | ) |   |   | (67 | ) |
| Adjustments to prior year tax losses                |   |                    | 1,097  |   |   |   | (1,053 | ) |   |   | 45 |   |
| Changes in valuation allowance                      |   |                    | (2,868 | ) |   |   | 1,569 |   |   |   | (63 | ) |
| Other                                               |   |                    | 312    |   |   |   | (256 | ) |   |   | (461 | ) |
| Income tax benefit (expense) from continuing        |   |                    |   |   |   |   |   |   |   |   |   |   |
| operations                                          |   | $                       | (149   | ) |   | $ | (90 | ) |   | $ | 1,026 |   |

----

----

| Year ending  |   |   |   |
|--------------|--------|--------|--------|
| December 31, |   |   |   |
|         |   |   |   |
| 2016         |   | $      | 1,356  |   |
| 2017         |   |   | 424    |   |
| 2018         |   |   | 353    |   |
| 2019         |   |   | 316    |   |
| 2020         |   |   | 312    |   |
|         |   | $      | 2,761  |   |

----

----

----

|                                           |   |      |   |   | Airport   |   |    |       |   |   |   |   |
|------------------------------------------------|--------|-----------|--------|--------|-----------|--------|---------|------------|--------|--------|--------|--------|
|                                           |   |      |   |   | Security  |   |    |       |   |   |   |   |
|                                           |   |      |   |   | and Other |   |    |       |   |   |   |   |
|                                           |   |      |   |   | Aviation  |   |    |       |   |   |   |   |
|                                           |   | Corporate |   |   | Services  |   |    | Technology |   |   | Total  |   |
| Year ended December 31, 2015:                  |   |      |   |   |      |   |    |       |   |   |   |   |
|  Revenue                                  |   | $         | -      |   |      | $      | 185,519 |       |   | $      | 1,503  |   |   | $ | 187,022 |   |
|  Depreciation and amortization            |   |      | 1      |   |      |   | 655     |       |   |   | 57     |   |   |   | 713 |   |
|  Income (loss) from continuing operations |   |      | (3,182 | )      |      |   | 1,597   |       |   |   | (3,117 | )      |   |   | (4,702 | ) |
|  Total assets from continuing operations  |   |      | 440    |   |      |   | 41,056  |       |   |   | 853    |   |   |   | 42,349 |   |
|                                           |   |      |   |   |      |   |    |       |   |   |   |   |   |   |   |   |
| Year ended December 31, 2014:                  |   |      |   |   |      |   |    |       |   |   |   |   |   |   |   |   |
|  Revenue                                  |   | $         | -      |   |      | $      | 172,102 |       |   | $      | 827    |   |   | $ | 172,929 |   |
|  Depreciation and amortization            |   |      | 3      |   |      |   | 689     |       |   |   | 69     |   |   |   | 761 |   |
|  Income (loss) from continuing operations |   |      | (99    | )      |      |   | 5,106   |       |   |   | (3,467 | )      |   |   | 1,540 |   |
|  Total assets from continuing operations  |   |      | 404    |   |      |   | 34,006  |       |   |   | 461    |   |   |   | 34,871 |   |
|                                           |   |      |   |   |      |   |    |       |   |   |   |   |   |   |   |   |
| Year ended December 31, 2013:                  |   |      |   |   |      |   |    |       |   |   |   |   |   |   |   |   |
|  Revenue                                  |   | $         | -      |   |      | $      | 124,130 |       |   | $      | 367    |   |   | $ | 124,497 |   |
|  Depreciation and amortization            |   |      | 2      |   |      |   | 671     |       |   |   | 91     |   |   |   | 764 |   |
|  Income( Loss) from continuing operations |   |      | (3,938 | )      |      |   | 2,373   |       |   |   | (3,689 | )      |   |   | (5,254 | ) |
|  Total assets from continuing operations  |   |      | 447    |   |      |   | 27,720  |       |   |   | 488    |   |   |   | 28,655 |   |

|            |   | Year Ended December 31, |    |
|-----------------|--------|-------------------------|---------|
|            |   | 2015                    |    |   | 2014 |   |   | 2013 |   |
|            |   |                    |    |   |   |   |   |   |   |
| United States   |   | $                       | 41,817  |   |   | $ | 39,983 |   |   | $ | 41,565 |   |
| The Netherlands |   |                    | 72,231  |   |   |   | 69,667 |   |   |   | 56,631 |   |
| Germany         |   |                    | 61,765  |   |   |   | 49,771 |   |   |   | 13,002 |   |
| Other           |   |                    | 11,209  |   |   |   | 13,508 |   |   |   | 13,299 |   |
| Total           |   | $                       | 187,022 |   |   | $ | 172,929 |   |   | $ | 124,497 |   |

----

|            |   | December 31, |   |
|-----------------|--------|--------------|--------|
|            |   | 2015         |   |   | 2014 |   |
|            |   |         |   |   |   |   |
| United States   |   | $            | 385    |   |   | $ | 361 |   |
| The Netherlands |   |         | 673    |   |   |   | 446 |   |
| Germany         |   |         | 235    |   |   |   | 192 |   |
| Other           |   |         | 200    |   |   |   | 258 |   |
| Total           |   | $            | 1,493  |   |   | $ | 1,257 |   |

----

INTERNATIONAL N

| Valuation and Qualifying Accounts |
|-----------------------------------|
| (US $ in thousands)               |

|                                   |   |      |   |   | Charges   |   |   |     |   |   |       |   |   |   |   |
|----------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|----------|--------|--------|------------|--------|--------|--------|--------|
|                                   |   |      |   |   | (Credit)  |   |   | Charges  |   |   |       |   |   |   |   |
|                                   |   |      |   |   | to        |   |   | to       |   |   |       |   |   |   |   |
|                                   |   | Beginning |   |   | Costs and |   |   | Other    |   |   |       |   |   | End of |   |
|                                   |   | of year   |   |   | Expenses  |   |   | Accounts |   |   | Deductions |   |   | Year   |   |
|                                   |   |      |   |   |      |   |   |     |   |   |       |   |   |   |   |
| Allowance for doubtful accounts(1):    |   |      |   |   |      |   |   |     |   |   |       |   |   |   |   |
|  Year ended December 31, 2013     |   | $         | 31     |   |      | $      | 30     |     |   | $      | -          |   |   | $      | (4     | ) |   | $ | 57 |   |
|  Year ended December 31, 2014     |   |      | 57     |   |      |   | 74     |     |   |   | -          |   |   |   | (15    | ) |   |   | 116 |   |
|  Year ended December 31, 2015     |   |      | 116    |   |      |   | (65    | )        |   |   | -          |   |   |   | (1     | ) |   |   | 50 |   |
|                                   |   |      |   |   |      |   |   |     |   |   |       |   |   |   |   |   |   |   |   |   |
| Allowance for net deferred tax assets: |   |      |   |   |      |   |   |     |   |   |       |   |   |   |   |   |   |   |   |   |
|  Year ended December 31, 2013     |   | $         | 20,781 |   |      | $      | -      |     |   | $      | -          |   |   | $      | 63     |   |   | $ | 20,844 |   |
|  Year ended December 31, 2014     |   |      | 20,844 |   |      |   | -      |     |   |   | -          |   |   |   | (1,569 | ) |   |   | 19,275 |   |
|  Year ended December 31, 2015     |   |      | 19,275 |   |      |   | -      |     |   |   | -          |   |   |   | 2,868  |   |   |   | 22,143 |   |

----

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