EDEN PRAIRIE, MN, July 22, 2003 - ImageWare Systems, Inc. (AMEX: IW) Fargo Electronics, Inc. (Nasdaq: FRGO) and ImageWare Systems, Inc. (AMEX:IW) have entered into an agreement that will establish Fargo as a master distributor of ImageWare’s off-the-shelf photo ID badge design and management software. ImageWare develops software solutions for the creation of secure photo IDs and credentials that are used for driver’s licenses, passports, national IDs, secure access control and more. Fargo creates innovative printing systems that personalize plastic identification cards, complete with digital images and text, lamination and electronically encoded information.

Beginning August 1, Fargo will distribute ImageWare’s EPI Suite® products in the Americas. Distribution internationally will begin later. EPI Suite products include EPI Suite Pro, EPI Suite Classic and EPI Suite Lite, and enable users to design ID cards; capture photographs and biometrics; maintain a secure database of cardholder information; encode magnetic stripes and smart chips; and print a variety of bar codes, including 2D.

“This agreement continues our drive to provide our distribution partners and end user customers with the very best card personalization systems,” says Gary Holland, Fargo’s president and CEO. “By providing ImageWare’s best-selling application software with Fargo’s innovative printer/encoders, our distribution partners can now offer a more seamless experience with state-of-the-art, tested and compatible systems. Plus, we are looking forward to new system developments from Fargo and ImageWare.”

ImageWare’s EPI Suite products will be sold with Fargo’s Professional and Persona® Series card printer/encoders and Fargo Certified Supplies. Fargo printer/encoders will remain on an “open architecture” platform for users who want to use their own or previously purchased software. ImageWare’s identification software will also retain its open architecture and continue to work with a variety of printers, cameras and other devices.

“Leveraging Fargo’s global distribution network is a key asset in increasing our sales,” commented Joe Schuler, president of ImageWare’s ID Solutions Group.

“The market is demanding more complete end-to-end solutions,” added Schuler. “The ImageWare-Fargo alliance will allow us to combine best-of-breed ID software and printers and provide our distribution partners a one-stop-shop for all of their credentialing needs. By streamlining distribution, ImageWare and Fargo will be able to jointly respond to changing market conditions more quickly, ensuring that our solutions effectively meet the ever-changing needs of our customers.”

“This is a prime opportunity for ImageWare to get back to our roots in software development and project sales,” stated Jim Miller, ImageWare’s president and CEO. “This partnership helps to ensure ImageWare’s leadership position in packaged ID software. It also permits us to aggressively go after high-end project sales in both the private and government sectors with our system integration and OEM partners. With this renewed focus on high-end projects, we will be better able to successfully support our distribution channel partners by becoming a value added resource for their ID project activity.”

About Fargo
Fargo is the world’s leader in innovative technologies for desktop plastic card personalization systems. Based in Eden Prairie, Minnesota, Fargo is the only manufacturer to offer three distinct technologies in printing systems – High Definition Printing™ (reverse image), traditional Direct-to-Card printing (dye-sublimation), and CardJet Printing™ Technology (inkjet) – to personalize plastic identification cards, complete with digital images and text, lamination and electronically encoded information.

Personalized identification cards provide physical, information and transaction security for a wide variety of applications including Corporations, National IDs, Drivers’ Licenses, Universities, Schools, Government Installations, Transportation, Casinos, Healthcare Facilities, E-commerce, Retail Stores, Correctional Institutions, Associations, Sports Events and Recreation Sites. More than 70,000 Fargo systems have been sold in the U.S. and in over 80 other countries. For more information, visit Fargo’s Web site at www.fargo.com.

About ImageWare Systems, Inc.
ImageWare Systems, Inc. (AMEX:IW), is a leading developer and provider of identity management solutions, providing biometric, secure credential, law enforcement and digital imaging technologies. Scalable for worldwide deployment, the Company's biometric product line includes a multi-biometric engine that is hardware and algorithm independent, enabling the enrollment and management of unlimited population sizes. ImageWare's identification products are used to manage and issue secure credentials including national IDs, passports, driver licenses, smart cards and access control credentials. ImageWare's digital booking products provide law enforcement with integrated mug shot, fingerprint Livescan and investigative capabilities. The Company also provides comprehensive digital workflow solutions for the professional photography industry. ImageWare is headquartered in San Diego, with offices in Washington DC and Canada. For more information visit www.iwsinc.com.

Safe Harbor Statement
This news release may contain forward-looking statements made pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. While these statements are meant to convey to the public the company's progress, business opportunities and growth prospects, readers are cautioned that such forward-looking statements represent management's opinion. While management believes such representation to be true and accurate based on the information available to the company, actual results may differ materially from those described. The company's operations and business prospects are always subject to risks and uncertainties. Important facts that may cause actual results to differ are set forth in the company’s periodic filings with the U.S. Securities and Exchange Commission.

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