Document Security Systems, Inc. Signs Letter of Intent to Spin-Off Legalstore.com Subsidiary

Under the terms of the Letter of Intent, IMS will acquire the Web property and related assets commonly referred to as the LegalStore.com from DSS and as payment will issue to DSS common stock of IMS equal to 30% of the outstanding shares of IMS on the Closing Date. Within 180 days after the Closing Date, or as soon as practicable, IMS will file a Registration Statement on Form S-1 with the Securities and Exchange Commission ("SEC") registering certain shares of IMS common stock, including the agreed number of shares of IMS common stock to be issued to DSS under the Agreement. At which time, the Company intends to declare the Record Date for the issuance of a shareholder dividend of shares of IMS Common Stock, the number of which has yet to be determined, to the beneficial share owners of Document Security Systems, Inc. Common Stock on such Record Date.

Patrick White, Chief Executive Officer and President of Document Security Systems, Inc., stated that, "Although not part of our core business, Legalstore.com is a hidden gem that can be very successful. This transaction will put Legalstore.Com's e-commerce potential in the hands of people dedicated to the Internet commerce sector. Raymond Meyers, Chief Executive Officer of Internet Media Services, Inc. has a proven track record of building successful web-based companies. He has founded, developed and sold several Internet companies with his most recent company being Eboz.com, an advanced marketing software company which was sold to Web.com (Nasdaq: WWWW). Furthermore, we believe the stock dividend, if consummated, will provide an attractive opportunity for DSS shareholders. In addition, this allows our management team to further focus on our core security businesses. "

Raymond Meyers, Chief Executive Officer of Internet Media Services, Inc. stated: "Legalstore.com has traditionally been operating as a business to business model. We feel it has major potential to expand as an Internet legal forms generating business model similar to Robert Shapiro's Legalzoom.com. We believe it has tremendous market potential as a public company."

LegalStore.com (www.legalstore.com) carries the world's largest selection of legal forms, traditional and hard to find office supplies, and custom products for every type of business in any industry. Legal Store was originally formed in 1949 to provide law firm supplies to the legal sector. With growing demand, it broadened its reach to general businesses requiring standard and unique office products. In 2003, Legal Store transitioned to an e-commerce web site, LegalStore.com. With numerous years of experience, the organization's personnel are experts in all forms of legal and office supplies used in today's modern businesses.

Raymond Meyers, founded Eboz.com in 2001 and served as Chief Executive Officer and President. Mr. Meyers, a veteran of several successful Internet start up ventures, has over 25 years of private and public company operating, financial, and management experience. He has extensive experience in strategic planning, product design and development, sales and marketing, financial controls, and operations management. Mr. Meyers currently sits on the board of several technology companies and is a frequent speaker at industry functions. Previously, Mr. Meyers has held executive and marketing positions at Pacific Bell, AT&T, Transamerica Corporation, ProtoSource Corporation, and Interliant Corporation. Mr. Meyers received his Bachelors degree from Rutgers University, with continuing education at UCLA.

Completion of the proposed transaction is subject to numerous conditions, including the final approval by Document Security Systems' Board of Directors, the filing and effectiveness of the Securities and Exchange Commission (SEC) by IMS, and any third party consents.

Safe Harbor Statement

This release contains forward-looking statements regarding expectations for future financial performance, which involve uncertainty and risk. It is possible the Company's future financial performance may differ from expectations due to a variety of factors including, but not limited to, changes in economic and business conditions in the world, increased competitive activity, achieving sales levels to fulfill revenue expectations, consolidation among its competitors and customers, technology advancements, unexpected costs and charges, adequate funding for plans, changes in interest and foreign exchange rates, regulatory and other approvals and failure to implement all plans, for whatever reason. It is not possible to foresee or identify all such factors. Any forward-looking statements in this report are based on current conditions; expected future developments and other factors it believes are appropriate in the circumstances. Prospective investors are cautioned that such statements are not a guarantee of future performance and actual results or developments may differ materially from those projected. The Company makes no commitment to update any forward-looking statement included herein, or disclose any facts, events or circumstances that may affect the accuracy of any forward-looking statement.

About Document Security Systems, Inc

Document Security Systems is a world leader in the development of optical deterrent technologies that help prevent counterfeiting and brand fraud from the use of the most advanced scanners, copiers and imaging systems in the market. The company's patented and patent-pending technologies protect valuable documents and printed products from counterfeiters and identity thieves. Document Security Systems' customers, which include international governments, major corporations and world financial institutions, use its covert and overt technologies to protect a number of applications including, but not limited to, currency, vital records, brand protection, ID Cards, internet commerce, passports and gift certificates. Document Security Systems' strategy is to become the world's leading producer of cutting-edge security technologies for paper, plastic and electronically generated printed assets.

More information about Document Security Systems, Inc. can be found at www.documentsecurity.com and www.plasticprintingprofessionals.com, www.legalstore.com, www.protectedpaper.com, and www.dpirochester.com

SOURCE: Document Security Systems, Inc.

Document Security Systems, Inc. 
Jody Jansen, 585-232-5440 
Shareholder Relations