Exhibit 99.1

Nestor, Inc.

Nestor Business Plan Presentation

October 2006

Nigel P. Hebborn

Chief Financial Officer

Nestor, Inc.

Safe Harbor Disclaimer

Statements in this presentation about future expectations, plans and prospects for

Nestor, including statements containing the words "expects," "will," and similar
expressions, are forward-looking statements within the meaning of Section 21E of the
Securities Exchange Act of 1934. We may not meet the expectations disclosed in our
forward-looking statements and investors should not place undue reliance on those
statements. Actual results may differ materially from those indicated by such
forward-looking statements as a result of various factors, including: market acceptance
of our products, competition, further approvals of contracted approaches, legal and
legislative challenges to automated traffic enforcement, and other factors discussed in
Risk Factors in our most recent Annual Report on Form 10-K and Quarterly Report on
Form 10-Q filed with the SEC. Investors are advised to read Nestor's Annual Report,
quarterly reports on Form 10-Q and current reports on Form 8-K filed after our most
recent annual or quarterly report. The forward-looking statements in this letter
represent our current views and we disclaim any obligation to update these
forward-looking statements.

Nestor, Inc.

George Ball, Non-Executive Chairman of the Board

Chairman of Sanders Morris Harris Group since May 2002

Former Chief Executive Officer of Prudential-Bache Securities

Bill Danzell, CEO and President

Serves as CEO and Chairman of Nestor Traffic Systems since January 2003

Founder and President of Danzell Investment Management, Ltd. (1995) a private investment management company corporate

restructurings focus

Joined Prudential Securities in 1983 and held the title of Senior Vice President-Portfolio manager until 1995; employed by Merrill

Lynch from 1981 through 1983. Prior to 1981, primary activity was financial and managerial reorganizations of privately held
corporations

Nigel Hebborn, Chief Financial Officer and President of Nestor Traffic Systems

Joined Nestor in October 1996 as CFO

Responsible for Nestor’s financial and corporate development activities;

Prior to joining Nestor, formed and served as President of Wolffish Consulting Services, Inc. Previously served as Vice

President of Finance of Nova American Group, Inc. and as President of its various subsidiaries

Todd Eikinas, Chief Operating Officer

Responsible for day to day operations including speed and red light product development, and software engineering

Prior to joining Nestor, managing director Peek Traffic System’s red light and speed enforcement programs.

Former IT head for State Street Bank (Boston).

Benjamin Alexander, Vice President, Secretary, and General Counsel

Prior to Nestor, practicing at Partridge Snow & Hahn since 2002; previously a partner at Hale and Dorr LLP

Before entering the legal profession, worked as a systems engineer, specializing in digital circuit design, programming and

systems integration

Management Team

Nestor, Inc.

Market Trends

Market Drivers

Large urban population growth causing increased traffic, vehicles faster &

safer, roadway growth limited

Increasing automotive accidents / injuries / fatalities

Police are asked to do more with less – highest citizen complaints – Traffic,

with speeding number one.

Old technology and process does not modify driver behavior and encourage

compliance

Adoption Rates

23 states and the District of Columbia allow the use of automated red light

enforcement systems

•

Additional 15 state legislatures considering bills to enable/expand

automated enforcement

10 states and the District of Columbia allow the use of automated speed

enforcement systems

Officer presence using photo speed under existing statutes opening new

states

“Free” implementation for municipalities may eliminate need to appropriate

funds or gain budget approval

Nestor, Inc.

Market Overview

Automated Red Light Enforcement Market

~300,000 signalized intersections in U.S.

Usually 4 directions of travel at each intersection

= 1,200,000 red light approaches

Estimated 2.5%-5.0% penetration

= 30,000 – 60,000 red light approach market

Alternative Market Size Estimate

1,869 U.S. cities with a population >25,000

Usually 20 cameras/city

= 37,380 red light approach market

Low Penetration to Date

Fragmented customer base as each city has a separate municipal body

Automated enforcement currently manages fewer than 2,000 approaches

Additional Market Opportunities for Speed Enforcement

Over 120,000 “high-risk areas” such as school and construction zones

Millions of miles of local streets and highways

Nestor, Inc.

Intelligent Software

Dr. Leon Cooper, Brown University Professor and Nobel Prize Winner, created predictive, intelligent

software and founded Nestor in 1977 to apply this technology in commercial applications.

Dr. Cooper’s early work in this field has led Nestor to create new applications in the automated

enforcement market.

1) CROSSINGGUARD (RED LIGHT ENFORCEMENT)

- “COLLISION AVOIDANCE”

- COMPLETE EVIDENCE PACKAGE

- NON-INVASIVE TECHNOLOGY

2) VIDEO VASCAR (SPEED DETECTION)

- MULTI-VIOLATORS IN MULTI-LANES

- DETECTION DEVICES INEFFECTIVE

- FULL ENFORCEMENT & HIGH COMPLIANCE

Nestor, Inc.

Used for violation detection

Monitors vehicles approaching the

intersection and provides context view of
violation

Signal Camera

Provides primary evidence of violation

Includes signal transition from yellow to red

Enforcement Camera

Captures plate images of violating vehicle

Captures driver image of violating vehicle

CrossingGuard Cameras

Tracking/Context Camera

Nestor, Inc.

Tracking Camera Configuration

Entry Zone

Limit Line

Confirmation

Line

Lane Map

Reference

Point

Exit Zone

Nestor, Inc.

Signal Camera – Shows the signal phase as vehicle approaches intersection

Enforcement Camera – Same camera captures over 80 images of front or rear of

the violating vehicle

Multiple Video Sequences Provide Strongest Possible Evidence

Signal and Enforcement Cameras

Multiple Video Sequences Provide Strongest Possible Evidence

Nestor, Inc.

Ability to monitor up to 4 lanes

simultaneously

Officer safety and efficiency

exponentially increased

On site citation processing without the

risks of “Pursue and issue”

Full touch process à“ One car at a time ”

Potential Risks

Traffic related

Dangerous driver

Potential litigation

Officer retention

Weather related impediments to

enforcement

Inefficient use of resources

Traditional Speed Enforcement

One Ticket At a Time

Revolutionary Speed

Van Enforcement Unit

Traditional Speed Enforcement

‘One Ticket at a Time’

PoliScan^speed Van Solution

‘Multiple Tickets at a Time’

PoliScan^speed Technology

Nestor, Inc.

PoliScan^SpeedMulti-Lane Scanning LiDAR

•

Multilane, Multi-Vehicle processing (Scans entire road, all lanes simultaneously)

•

Not restricted to straight roads (only needs 75 ft to operate)

•

High resolution evidence packages

•

3D image processing

•

The only bi-directional LiDAR

Nestor, Inc.

Unit deployed up to

800 feet from vehicle

Makes all locations

accessible

Mobile Mount

Wireless TripodMount

Nestor, Inc.

NTS Multi-vehicle tracking

Nestor, Inc.

NTS Video VASCAR^Ô^speedsystem

Independent Video Speed Evidence Confirmation

Records basic time over distance measurements

Calculations can be compared to the evidence collected from the PoliScan^speed

system

Fundamental measurements are easy to present in court

Algorithms used by NTS Video VASCAR are the same algorithms used in

conventional VASCAR widely recognized by courts throughout the United States

Nestor, Inc.

Video VASCAR Tracking

Nestor, Inc.

Install & Maintenance

Training & Support

Violation Review

Citation Processing

Site Planning

Equipment Installation

•

Nestor pays up-front for the equipment, maintenance and installation of the

red light and speed systems

•

States and municipalities receive an income stream at no cost

User Training and Support

•

Nestor trains municipal personnel and assists in educating the public on

products and safety features

•

Nestor offers a toll-free hotline for questions and support

Violation Review

•

Nestor reviews each potential infraction prior to electronically sending to

state and municipal agencies for review

Citation Processing

•

Upon receiving municipal approval from potential infractions sent by Nestor

– the Company offers a full suite of citation processing services which
includes:

–

Processing

–

Mailing

–

Fine collections

Turn-key Services Offered by Nestor

Site Planning

•

Nestor works with municipalities to perform statistical feasibilities

studies to determine appropriate approaches prior to installation

•

Efficient site planning for increased safety, decreased accidents,

decreased police and emergency services

Nestor, Inc.

Fixed Monthly

Fee

3 Revenue Generation Models

Per Ticket

Fee

Combined:

Fixed Monthly
and
Per Ticket Fees

Business Model

Nestor provides installation of its systems and retains ownership of the equipment

No capital outlay required by municipality

Turnkey provision of equipment, software, and processing services

Allows Nestor to structure recurring revenue contracts

In general, red light contract term: 3-5 years

Speed contracts term varies from 30 days-5 years

Nestor, Inc.

Public Safety
CrossingGuard	PoliScan^speed

Complete System
CrossingGuard and PoliScan^speed

Revenue
CrossingGuard and PoliScan^speed

50%-80% reduction in violations in

an enforced approach

Collision avoidance technology

pre-determines if a car will run the
red-light and stop cross traffic

Increase traffic safety in school and

construction zones

Consistent enforcement changes

drivers’ behavior

Ticket delivery by U.S. mail eliminates

officer risk

Full maintenance

Complete solution generates citations, ticket processing and mailing evidence

package

Superior evidence package dramatically reduces citation contesting

(reducing traffic related court costs)

No upfront equipment or installation costs

Increase ticket revenue with automated 24 / 7 enforcement

Reduce accidents, thus reduce response costs (police/fire)

Value Proposition

Municipalities migrate from manual enforcement to Nestor’s

automated traffic enforcement solutions because:

Nestor, Inc.

Growing monthly recurring revenue stream

Strong revenue visibility based on existing contractual backlog and installation rates

High quality debtors, payment usually in 30-45 days

Short payback period on CapEx

15 months for CrossingGuard approach

<6 months for PoliScan^speed

Expected positive modified EBITDA after installation of 250 red light approaches and

25 speed units

Financial Highlights

Nestor, Inc.

1. Units as of December 31 of year.

Units

CG: 182

Speed:

Historical Revenue

Nestor, Inc.

CrossingGuard

Automated Red Light Solution

PoliScan^{speed
NTS} Video VASCAR

Fixed and Mobile Speed Scanning

Company Overview Today

Nestor is a leading provider of innovative, automated traffic enforcement

systems and services to state and local governments throughout the United
States

Over 200 red light approaches generating revenue

10 speed scanning units currently operating (7 mobile, 3 permanent)

Installed systems in 40 municipalities in 10 states and 1 Canadian

province

Red light solutions are sold under long term contracts, speed solutions

vary

Revenues commence within 30-90 days after system installation

Nestor, Inc.

Inflection Point

Increasing state authorizations for automated red light and speed enforcement

Washington, Texas, Missouri, Tennessee cities expanding the adoption of red light and speed safety

programs in 2006

Increasing contract awards – red light, fixed speed and mobile speed

11 new contracts signed in 2006

Recently received City of Baltimore request for 47 additional red light systems

Signed Los Angeles contract for up to 64 red light approaches in February

•

Displaced ACS as city’s automated red light enforcement vendor

•

Installations commenced in Q3 2006 continuing through mid-2007

Mobile speed van product is ready for distribution

Deployed in Akron, OH school zones and East Cleveland city roads, generating revenue from mobile

speed under Registered Owner enforcement

Expected to be deploying in Marble Falls and Rhome, Texas for mobile enforcement with officer present

under Driver Liability enforcement

Accelerating red light and speed installations in 2006 are expected to begin to reflect in recurring

revenue growth trend in early 2007

182 installed red light approaches and 3 speed units at June 30, 2006

Today - 202 red light and 10 speed units installed

110 red light and 4 speed units in active design and delivery phases

Additional 120 red light and 6 speed units awaiting site analysis & selection

Nestor, Inc.

Company Highlights

Large and rapidly growing market for automated traffic enforcement solutions

Red light and speed

Other related applications

Extensive product platform and existing installed base

Proven best of breed technologies

Long term contracts provide recurring revenue model and potential for high return on

CapEx

Strong growth potential and plan-to-profitability

Experienced management team

Nestor, Inc.

Thank You