Dragontail Systems Limited ACN 614 800 136

673 Bourke Street, Melbourne VIC 3000 T +61 3 9021 6862 W www.dragontailsystems.com

8 March 2017

The Company Announcements Office

ASX Limited

Via E Lodgment

Investor Presentation – Monthly Price Correction

On 6 March 2017, Dragontail Systems Limited released its Investor Presentation.

Due to an accidental error, the figure included in the table on page 13 of the Investor Presentation

relating to monthly price of the QA camera & sensors installation of USD30, has now been corrected

to USD50.

The updated Investor Presentation is attached.

End.

Company Secretary:

Deborah Ho

deborah@tridentms.com.au

+61 8 6211 5099

Media Enquiries:

Ben Grubb

Media and Capital Partners

ben.grubb@mcpartners.com.au

+61 414 197 508

About Dragontail Systems

Dragontail is revolutionizing the Quick Service Restaurant (QSR) industry with its Algo System, which

uses a sophisticated patented algorithm to optimize and manage the entire food preparation process

from order to delivery. The Algo is the first system in the world to fully automate and streamline the

kitchen flow to deliver immediate and significant returns on investment to fast food and quick service

restaurants. The Algo is setting a new standard for the global industry with a number of chains, such

as Pizza Hut in North America and Israel, and a large Israeli burger chain already using the system. For

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Investor Presentation

March 2017

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This document has been prepared by Dragontail Systems Limited (DTS) to provide selected parties with a preliminaryunderstanding of DTS. It is provided on a confidential basis, and may not be reproduced in whole or in part, nor may any of itscontents be disclosed to any other person, without DTS’s prior written consent. This document is provided by DTS for generalinformation purposes only, without taking into account any potential investors’ personal objectives, financial situation or needs. Itshould not be relied upon by the recipient in considering the merits of any particular transaction. It is not an offer to buy or sell, or asolicitation to invest in or refrain from investing in, any securities or other investment product. Nothing in this document constitutesinvestment, legal, tax, accounting, financial product or other advice. The recipient should consider its own financial situation,objectives and needs, and conduct its own independent investigation and assessment of the contents of this document,including obtaining investment, legal, tax, accounting and such other advice as it considers necessary or appropriate. Thisdocument has been prepared on the basis of publicly available information and certain confidential information. DTS has reliedupon and assumed, without independent verification, the accuracy and completeness of all such information, includingforecasts. It contains selected information and does not purport to be all inclusive or to contain all of the information that may berelevant to the document. The recipient acknowledges that circumstances may change and that this document may becomeoutdated as a result. DTS is under no obligation to update or correct this document. DTS its related bodies corporate and otheraffiliates, and their respective directors, employees, consultants and agents make no representation or warranty as to theaccuracy, completeness, timeliness or reliability of the contents of this document. To the maximum extent permitted by law, nomember of DTS accepts any liability (including, without limitation, any liability arising from fault or negligence on the part of any ofthem) for any loss whatsoever arising from the use of this document or its contents or otherwise arising in connection with it. Anyrequests for information in connection with this document should be addressed directly to DTS and to no other party.

This document contains forward-looking statements which are identified by words such as "believes", "estimates", "expects',"targets", "intends", "may", "will", "would", "could", or "should" and other similar words that involve risks and uncertainties. Thesestatements are based on an assessment of present economic and operating conditions, and on a number of assumptionsregarding future events and actions that, as at the date of this Prospectus, are expected to take place. Such forward-lookingstatements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and otherimportant factors, many of which are beyond the control of DTS, the Directors and management of DTS. DTS has no intention toupdate or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whethernew information, future events or any other factors affect the information contained in this Prospectus, except where required bylaw. DTS cannot and does not give assurances that the results, performance or achievements expressed or implied in the forward-looking statements contained in this document will actually occur and investors are cautioned not to place undue reliance onthese forward-looking statements.

Disclaimer

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Capital Structure

ASX Code DTS

Market Cap* $52m

Share Price [at 3 March 2017] $0.30

Cash-on-Hand [at 31 Dec 2016] $5.8m

Ordinary Issued Shares3 173.5m

Performance Shares1 25m

Incentive Options2 1.5m

Top 20 Holdings 74.4%

Corporate Snapshot

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Dragontail share price performance since listing

* To 24 February, 2017. Source: Google Finance

Board of Directors

• Paul Steele (NED Chairman) – Senior executive based in

Melbourne with experience in software technology, managementconsulting and not for profit and healthcare organizations.

• Ido Levanon (CEO) – over 20 years experience in CEO and

turnaround management roles of various international companies. MBASan Diego University (1989, Magna cum laude), B.Sc. Maths &Computer Science Tel Aviv University (1986, Dean’s List).

• Adam Sierakowski (NED) – Over 20 experience in corporate law

and advisory services both in Australia and internationally and has vastexperience as both chairman and director of multiple ASX listed entities.

• Yehuda Shamai (NED) – has established and managed large

Israeli entities with international brands such as Pizza Hut, KFC andDomino’s. He has vast knowledge in management software tools andePayments technology.

• Ron Zuckerman (NED) – Has been an active tech entrepreneur for

nearly 25 years. He was one of the founders of Sapiens International, asoftware company he took public on the NASDAQ in 1990 and which iscurrently trading with a market cap of over US$700m.

1. Issued on achieving annual earnings of $US5.5m by end of 20192. Options exercise price of $0.25 and expiring 31 Dec 2018.3. Approximately 115,000,000 shares escrow for at least 12 months

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The Algo technology completely revolutionises restaurant operations and management

in the Fast Food/QSR industry.

The food preparation, delivery, marketing operations and Customer Relationship Management

(“CRM”) are integrated into a single GPS-based algorithm and management software, which

optimises, manages and controls the entire operations chain - completely streamlining the

entire process.

The Algo dispatching system starts the optimisation process before the orders are even shown

to the cook for preparation. It chooses the best sequence so orders are grouped at the kitchen

in the most optimal way and all orders are prepared just in time for the driver to pick up.

It takes into consideration many key factors in order to achieve this, such as driver availability,

order time, number of items in the order, hour of the day, planned staffing and weather.

The Algo – How it works

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Dispatch Station Kitchen Station Driver Unit Customer Tracking

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The Algo can be integrated with any POS (Point of Sale) system.

The only additional hardware needed are driver mobile units which are provided with the

system.

The Algo system uses a proxy server outside the store that handles all the communication

between the drivers, the store, the customers (who can track the order and driver status), and

management (that can review online reports and alerts).

The Algo (continued)

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Our second product is a unique and innovative quality control camera and

additional wireless sensors that ensures our QSR (Quick Service Restaurant) customers

produce the best food and the end-consumer receives their exact order.

Camera Cut Station Unit (CCSU)

• A revolutionary marketing and operations tool

• Takes a picture of the pizza when it comes out of the oven and sends it to the end consumer

• Checks the temperature of the pizza and if correct toppings have been added

• Checks the quality of the pizza ingredients (the crust and the cheese)

• Has wireless sensors in place that constantly monitor the temperatures of the restaurant fridge and oven

• Uses the most advanced machine learning technology where the system keeps improving its diagnostics over time, and a texture synthesize mechanism to ensure the product image sent to the customer will always look

great

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• Presents the next dish to be prepared by

the chef

• Intelligent synchronisation tool between

parallel Kitchens

• Automatically makes sure all meal

components (entree, main course,

dessert) are ready at the perfect time to

be served to customer

Smart KDS

Our third product is an version of the Algo dedicated to the optimization of

kitchens and non delivery restaurants

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● Successfully listing on the ASX with a $6m IPO (December 2016)

● Strategic alliance with AT&T (December 2016)

● Launches world’s first quality control camera and sensor system for the pizza

industry (December 2016)

● Commercial roll out of Pizza Hut stores in Quebec commenced (January 2017)

● Official strong endorsement form YUM Canada management to all franchisees

listing all the great benefits of the system after a year of operation.

● Agreement with Revel Systems, leading POS (Point of Sale) provider (January

2017)

● Gaining strong traction across QSR industry with growing new installations and

sticky revenues since listing, in existing and new markets

● Maintaining first mover advantage as the only system in the world that fully

automates kitchen optimisation, flow, despatch and delivery.

Commercial Updates

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While the roll out of the Algo in the QSR sector is a continuing the application of this

unique automated optimizer can benefit many other sectors:

• The Algo system can be utilized in a number of sectors other than QSR such as:

Hotel room service

Airline catering

Supermarket deliveries

Same day couriers

Technicians despatch

Algo more than just QSR

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Milestones

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• Complete roll-out of Algo to all major customer Corporate Stores in Canada

• Sign First customer in Australia

• First commercial implementation of CCSU

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• Start implementation of Algo to major customer franchisees in the USA

• Sign first customer in Asia

• Start implementation

of Algo in non QSR sector

• Start implementation of Algo to major customer franchisees in Canada

• First monthly revenues >US$25/mth

• Achieve over 150 installations

• Achieve over 225 installations

• Achieve monthly revenues of>US$60k/mth

• Algo operating in more than 6 countries and

pipeline of more than 1,000 stores

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The Algo Dispatching System is sold via three methods:

Marketing strategy

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Partnerships with leading POS (Point of Sale) companies we integrate with. (By partnering, Dragontail gets access to the POS customers and the POS company can offer enhanced capabilities and get revenue from shared customers)

Direct sales to key large QSR customers

Partnership with leading players such as AT&T, (Using its existing salesforce and connections to reach out to more potential customers)

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Commercial model

The business model for the Algo Dispatching & QA Camera and Sensors Systems are

composed of two components:

Monthly Service & Support

fee

• Mitigating customer concern about high costs and confirming ongoing income to Dragontail

Initial fee

• Setup fee including integration with existing QSR POS system

• Training for QSR IT group to implement at stores

• Help with first store’s installation and training

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• The Algo has already been commercially deployed in Pizza Hut stores in Israel, Canada and USA with significant immediate operational improvements for the restaurants and increased customer satisfaction for end users.

• Anticipated strong demand for near term roll-out across a large number of Pizza Hut stores in these countries and also other priority countries.

• Dragontail is in various stages of discussion and implementation with other QSR franchises and

not just restricted to pizza (including an international chicken franchise, international burger franchise, international noodle franchise, international Mexican franchise and more).

Revenue case study: Algo Pipeline

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Brand CountryEstimated

Stores

Algo

Installation

Algo Price /

month

QA camera & sensors

installation

QA camera &

sensors price /

month

Pizza Hut Canada 300+ 1 $1,000 $170 $2,000 $50

Pizza Hut USA 7,000+ 1 $1,000 $170 $2,000 $50

Yum Brands World 43,500 3 $1,000 $170 $2,000 $50

QSR USA 200,000+ 4 $1,000 $170 $2,000 $50

Total 250,800

All prices $USD

1 https://www.pizzahut.ca/#!/page/62 http://www.statista.com/statistics/256828/pizza-hut-restaurants-worldwide/3 https://www.yum.com. 4 https://www.ibisworld.com Aug 2016

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Operations case study: Pizza Hut Israel

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First pilot store – Dec 2013

Rollout to corporate stores –

commenced Feb 2014

Rollout to franchisees –commenced

Jan 2015Algo stores experienced a

reduction in labour cost (as % of

sales)

Algo stores experienced

same store sales increase, mainly

due to an increase in repeat customers orders.

2.8%

9.8%

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100% Increase in on-timedeliveries

Increase in repeat

customers20%

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Competitive analysis

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Delivery Command Foodora Uber Eats The Algo

Driver tracking ✔ ✔ ✔ ✔

Customer tracking ✔ ✗ ✔ ✔

Fully automated dispatching decisions ✗ ✗ ✗ ✔

Fully automated kitchen flow ✗ ✗ ✗ ✔

Meals always arriving hot and fresh ✗ ✗ ✗ ✔

Reduced labour costs ✗ ✗ ✗ ✔

Single software system ✗ ✗ ✗ ✔

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Investment highlights

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5.4. 6.

2.1. 3.Unique, first-mover technology

The Algo is the only system in the world that fully automates the kitchen flow, the driver dispatch and delivery process. Current technologies only focus on driver dispatch and tracking.

Significant competitive

advantage

The Algo is a unique, patent pending system that uses a very sophisticated algorithm and years of on-site operation experience that creates high barriers for entry for potential Dragontail competitors.

Established and growing

revenue base and commercial

pipeline

The Algo is already installed in Israel, Canada and the US and generating revenue from monthly licensing fees. Further growth in existing and new markets is expected.

Strong validation from leading

QSRs

Our QSR customers are reporting additional monthly revenues of ~10% and monthly labour cost savings of ~3%, while also reporting significant improvements in customer satisfaction and a reduction in customer complaints.

Significant market opportunity

Fast food/QSR/delivery market size of over $400 billion globally with over $250 billion in North America alone. Potential to expand into additional markets such as

supermarket deliveries, airline/other catering, and non-food same day deliveries.

High-calibre management

team

Management have significant expertise across technology, systems management and business development.

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Products Videos

The Story of Marry and Jamie (Algo 101)

http://www.dragontailsystems.com/algo101

The Algo Dispatching System

http://www.dragontailsystems.com/watch-a-video

The Camera Unit

http://www.dragontailsystems.com/ccsu

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Contact

Ido Levanon

Chief Executive Officer

BSR1 Tower

Ben Gurion 2,

Ramat Gan, Israel

T: +972546567661

E: www.dragontailsystems.com

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