Exhibit 10.2

Imageware Systems, Inc.

2001 Equity Incentive Plan

Adopted September 12, 2001
Termination Date: September 12, 2011

1. Purposes.

(a)    Eligible Stock Award Recipients.The persons eligible to receive Stock Awards are the Employees,
Directors and Consultants of the Company and its Affiliates.

(b)    Available Stock Awards.The purpose of the Plan is to provide a means by which eligible recipients
of Stock Awards may be given an opportunity to benefit from increases in value of the Common Stock through the granting of the following Stock Awards: (i) Nonstatutory Stock Options,
(ii) stock bonuses and (iii) rights to acquire restricted stock.

(c)    General Purpose.The Company, by means of the Plan, seeks to retain the services of the group of
persons eligible to receive Stock Awards, to secure and retain the services of new members of this group and to provide incentives for such persons to exert maximum efforts for the success of the
Company and its Affiliates.

2. Definitions.

(a)"Affiliate"means any parent corporation or subsidiary corporation of the
Company, whether now or hereafter existing, as those terms are defined in Sections 424(e) and (f), respectively, of the Code.

(b)"Board"means the Board of Directors of the Company.

(c)"Cause"means, with respect to a particular Participant, the occurrence of
any of the following: (i) such Participant's conviction of any felony or any crime involving fraud or; (ii) such Participant's participation (whether by affirmative act or omission) in a
fraud, act of dishonesty or other act of misconduct against the Company and/or its Affiliates; (iii) conduct by such Participant which, based upon a good faith and reasonable factual
investigation, demonstrates such Participant's unfitness to serve; (iv) such Participant's violation of any fiduciary duty or duty of loyalty owed to the Company and/or its Affiliates;
(v) such Participant's breach of any material term of any material contract between such Participant and the Company and/or its Affiliates; (vi) such Participant's repeated violation of
any material Company policy; and (vii) the Participant's violation of state or federal law in connection with the performance of the Participant's job. Notwithstanding the foregoing, such
Participant's death or Disability shall not constitute Cause as set forth herein. The determination that a termination is for Cause shall be by the Board or Committee, as applicable, in its sole and
exclusive judgment and discretion.

(d)"Code"means the Internal Revenue Code of 1986, as amended.

(e)"Committee"means a committee of one or more members of the Board appointed
by the Board in accordance with subsection 3(c).

(f)"Common Stock"means the common stock of the Company.

(g)"Company"means ImageWare Systems, Inc., a California corporation.

(h)"Consultant"means any person, including an advisor, (i) engaged by
the Company or an Affiliate to render consulting or advisory services and who is compensated for such services or (ii) who

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is a member of the Board of Directors of an Affiliate. However, the term "Consultant" shall not include either Directors who are not compensated by the Company for their services as Directors or
Directors who are merely paid a director's fee by the Company for their services as Directors.

(i)"Continuous Service"means that the Participant's service with the Company
or an Affiliate, whether as an Employee, Director or Consultant, is not interrupted or terminated. The Participant's Continuous Service shall not be deemed to have terminated merely because of a
change in the capacity in which the Participant renders service to the Company or an Affiliate as an Employee, Consultant or Director or a change in the entity for which the Participant renders such
service, provided that there is no interruption or termination of the Participant's Continuous Service. For example, a change in status from an Employee of the Company to a Consultant of an Affiliate
or a Director will not constitute an interruption of Continuous Service. The Board or the chief executive officer of the Company, in that party's sole discretion, may determine whether Continuous
Service shall be considered interrupted in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal leave.

(j)"Director"means a member of the Board of Directors of the Company.

(k)"Disability"means the permanent and total disability of a person within
the meaning of Section 22(e)(3) of the Code.

(l)"Employee"means any person employed by the Company or an Affiliate. Mere
service as a Director or payment of a director's fee by the Company or an Affiliate shall not be sufficient to constitute "employment" by the Company or an Affiliate.

(m)"Exchange Act"means the Securities Exchange Act of 1934, as amended.

(n)    "Fair Market Value"means, as of any date, the value of the Common Stock
determined as follows:



(o)"Key Employee"means an employee who is not an executive officer, but is
expected by the Company to make a significant contribution to the business, as provided in Item 401(b) of Regulation S-B of the Securities Act.

(p)"Non-Employee Director"means a Director who either
(i) is not a current Employee or Officer of the Company or its parent or a subsidiary, does not receive compensation (directly or indirectly) from the Company or its parent or a subsidiary for
services rendered as a consultant or in any capacity other than as a Director (except for an amount as to which disclosure would not be required under Item 404(a) of Regulation S-K
promulgated pursuant to the Securities Act ("Regulation S-K")), does not possess an interest in any other transaction as to which disclosure would be required under Item 404(a) of
Regulation S-K and is not engaged in a business relationship as to which disclosure would be required under Item 404(b) of Regulation S-K; or (ii) is
otherwise considered a "non-employee director" for purposes of Rule 16b-3.

(q)"Nonstatutory Stock Option"means an Option not intended to qualify as an
"incentive stock option" within the meaning of Section 422 of the Code and the regulations promulgated thereunder.

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(r)"Officer"means a person who possesses the authority of an "officer" as
that term is used in Rule 16a-1(f) of the Exchange Act. For purposes of the Plan, a person in the position of "Vice President" or higher shall be classified as an "Officer" unless
the Board or Committee expressly finds that such person does not possess the authority of an "officer" as that term is used in Rule 16a-1(f) of the Exchange Act.

(s)"Option"means a Nonstatutory Stock Option granted pursuant to the Plan.

(t)"Option Agreement"means a written agreement between the Company and an
Optionholder evidencing the terms and conditions of an individual Option grant. Each Option Agreement shall be subject to the terms and conditions of the Plan.

(u)"Optionholder"means a person to whom an Option is granted pursuant to the
Plan or, if applicable, such other person who holds an outstanding Option.

(v)"Participant"means a person to whom a Stock Award is granted pursuant to
the Plan or, if applicable, such other person who holds an outstanding Stock Award.

(w)"Plan"means this ImageWare Systems, Inc. 2001 Equity Incentive
Plan.

(x)"Rule 16b-3"means Rule 16b-3
promulgated under the Exchange Act or any successor to Rule 16b-3, as in effect from time to time.

(y)"Securities Act"means the Securities Act of 1933, as amended.

(z)"Stock Award"means any right granted under the Plan, including an Option,
a stock bonus and a right to acquire restricted stock.

(aa)"Stock Award Agreement"means a written agreement between the Company and
a holder of a Stock Award evidencing the terms and conditions of an individual Stock Award grant. Each Stock Award Agreement shall be subject to the terms and conditions of the Plan.

3. Administration.

(a)    Administration by Board.The Board shall administer the Plan unless and until the Board delegates
administration to a Committee, as provided in subsection 3(c).

(b)    Powers of Board.The Board shall have the power, subject to, and within the limitations of, the
express provisions of the Plan:



(c)    Delegation to Committee.

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(d)    Effect of Board's Decision.All determinations, interpretations and constructions made by the Board
in good faith shall not be subject to review by any person and shall be final, binding and conclusive on all persons.

4. Shares Subject to the Plan.

(a)    Share Reserve.Subject to the provisions of Section 11 relating to adjustments upon changes
in Common Stock, the Common Stock that may be issued pursuant to Stock Awards shall not exceed in the aggregate one million (1,000,000) shares of Common Stock.

(b)    Reversion of Shares to the Share Reserve.If any Stock Award shall for any reason expire or
otherwise terminate, in whole or in part, without having been exercised in full, the shares of Common Stock not acquired under such Stock Award shall revert to and again become available for issuance
under the Plan.

(c)    Source of Shares.The shares of Common Stock subject to the Plan may be unissued shares or
reacquired shares, bought on the market or otherwise.

5. Eligibility.

(a)    Eligibility for Specific Stock Awards.Stock Awards may be granted to Employees, Directors and
Consultants.

(b)    Restrictions on Eligibility.Notwithstanding the foregoing, during the three (3) year period
beginning on the date the Plan is adopted and during each annual period thereafter, the aggregate number of shares granted to Officers, Directors and Key Employees pursuant to Stock Awards (including
Options, stock bonuses and rights to acquire restricted stock) cannot be greater than fifty percent (50%) of the
number of shares granted to all persons under the Plan;provided thatthere shall be excluded from this calculation shares granted to Officers not
previously employed by the Company pursuant to Stock Awards granted as an inducement essential to such individuals entering into employment contracts with the Company.

(c)    Consultants.



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6. Option Provisions.

Each Option shall be in such form and shall contain such terms and conditions as the Board shall deem appropriate. The provisions of separate Options need not
be identical, but each Option shall include (through incorporation of provisions hereof by reference in the Option or otherwise) the substance of each of the following provisions:

(a)    Term.The term of an Option shall be the term determined by the Board, either at the time of grant
of the Option or as the Option may be amended thereafter.

(b)    Exercise Price of an Option.The exercise price of each Option shall be not less than
eighty-five percent (85%) of the Fair Market Value of the Common Stock subject to the Option on the date the Option is granted. Notwithstanding the foregoing, an Option may be granted with
an exercise price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption or substitution for another option in a manner satisfying the provisions of
Section 424(a) of the Code.

(c)    Consideration.The purchase price of Common Stock acquired pursuant to an Option shall be paid, to
the extent permitted by applicable statutes and regulations, either (i) in cash at the time the Option is exercised or (ii) at the discretion of the Board at or after the time of the
grant of the Option (1) by delivery to the Company of other Common Stock, (2) according to a deferred payment or other similar arrangement with the Optionholder or (3) in any
other form of legal consideration that may be acceptable to the Board. Unless otherwise specifically provided in the Option, the purchase price of Common Stock acquired pursuant to an Option that is
paid by delivery to the Company of other Common Stock acquired, directly or indirectly from the Company, shall be paid only by shares of the Common Stock of the Company that have been held for more
than six (6) months (or such longer or shorter period of time required to avoid a charge to earnings for financial accounting purposes). At any time that the Company is incorporated in
Delaware, payment of the Common Stock's "par value," as defined in the Delaware General Corporation Law, shall not be made by deferred payment.

In
the case of any deferred payment arrangement, interest shall be compounded at least annually and shall be charged at the minimum rate of interest necessary to avoid the treatment
as interest, under any applicable provisions of the Code, of any amounts other than amounts stated to be interest under the deferred payment arrangement.

(d)    Transferability of an Option.An Option shall be transferable to the extent provided in the Option
Agreement. If the Option does not provide for transferability, then the Option shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable during the
lifetime of the Optionholder only by the Optionholder. Notwithstanding the foregoing, the Optionholder may, by delivering written notice to the Company, in a form satisfactory to the Company,
designate a third party who, in the event of the death of the Optionholder, shall thereafter be entitled to exercise the Option.

(e)    Vesting Generally.The total number of shares of Common Stock subject to an Option may, but need
not, vest and therefore become exercisable in periodic installments that may, but need

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not, be equal. The Option may be subject to such other terms and conditions on the time or times when it may be exercised (which may be based on performance or other criteria) as the Board may deem
appropriate. The vesting provisions of individual Options may vary. The provisions of this subsection 6(g) are subject to any Option provisions governing the minimum number of shares of Common Stock
as to which an Option may be exercised.

(f)    Termination of Continuous Service.In the event an Optionholder's Continuous Service terminates
(for reasons other than Cause or upon the Optionholder's death or Disability), the Optionholder may exercise his or her Option (to the extent that the Optionholder was entitled to exercise such Option
as of the date of termination) but only within such period of time ending on the earlier of (i) the date three (3) months following the termination of the Optionholder's Continuous
Service (or such longer or shorter period specified in the Option Agreement), or (ii) the expiration of the term of the Option as set forth in the Option Agreement. If, after termination, the
Optionholder does not exercise his or her Option within the time specified in the Option Agreement, the Option shall terminate.

(g)    Extension of Termination Date.An Optionholder's Option Agreement may also provide that if the
exercise of the Option following the termination of the Optionholder's Continuous Service (for reasons other than Cause or upon the Optionholder's death or Disability) would be prohibited at any time
solely because the issuance of shares of Common Stock would violate the registration requirements under the Securities Act, then the Option shall terminate on the earlier of (i) the expiration
of the term of the Option set forth in subsection 6(a) or (ii) the expiration of a period of three (3) months after the termination of the Optionholder's Continuous Service during which
the exercise of the Option would not be in violation of such registration requirements.

(h)    Disability of Optionholder.In the event that an Optionholder's Continuous Service terminates as a
result of the Optionholder's Disability, the Optionholder may exercise his or her Option (to the extent that the Optionholder was entitled to exercise such Option as of the date of termination), but
only within such period of time ending on the earlier of (i) the date twelve (12) months following such termination (or such longer or shorter period specified in the Option Agreement)
or (ii) the expiration of the term of the Option as set forth in the Option Agreement. If, after termination, the Optionholder does not exercise his or her Option within the time specified
herein, the Option shall terminate.

(i)    Death of Optionholder.In the event (i) an Optionholder's Continuous Service terminates as a
result of the Optionholder's death or (ii) the Optionholder dies within the period (if any) specified in the Option Agreement after the termination of the Optionholder's Continuous Service for
a reason other than death, then the Option may be exercised (to the extent the Optionholder was entitled to exercise such Option as of the date of death) by the Optionholder's estate, by a person who
acquired the right to exercise the Option by bequest or inheritance or by a person designated to exercise the Option upon the Optionholder's death pursuant to subsection 6(d), but only within the
period ending on the earlier of (1) the date six (6) months following the date of death (or such longer or shorter period specified in the Option Agreement) or (2) the expiration
of the term of such Option as set forth in the Option Agreement. If, after death, the Option is not exercised within the time specified herein, the Option shall terminate.

(j)    Termination for Cause.In the event an Optionholder's Continuous Service is terminated for Cause,
the Option shall terminate upon the termination date of such Optionholder's Continuous Service and the Optionholder is prohibited from exercising his or her Option as of the time of such termination.

(k)    Early Exercise.The Option may, but need not, include a provision whereby the Optionholder may
elect at any time before the Optionholder's Continuous Service terminates to exercise the Option as to any part or all of the shares of Common Stock subject to the Option prior to the full vesting of
the Option. Any unvested shares of Common Stock so purchased may be subject to a

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repurchase option in favor of the Company or to any other restriction the Board determines to be appropriate.

7. Provisions of Stock Awards other than Options.

(a)    Stock Bonus Awards.Each stock bonus agreement shall be in such form and shall contain such terms
and conditions as the Board shall deem appropriate. The terms and conditions of stock bonus agreements may change from time to time, and the terms and conditions of separate stock bonus agreements
need not be identical, but each stock bonus agreement shall include (through incorporation of provisions hereof by reference in the agreement or otherwise) the substance of each of the following
provisions:



(b)    Restricted Stock Awards.Each restricted stock purchase agreement shall be in such form and shall
contain such terms and conditions as the Board shall deem appropriate. The terms and conditions of the restricted stock purchase agreements may change from time to time, and the terms and conditions
of separate restricted stock purchase agreements need not be identical, but each restricted stock purchase agreement shall include (through incorporation of provisions hereof by reference in the
agreement or otherwise) the substance of each of the following provisions:



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8. Covenants of the Company.

(a)    Availability of Shares.During the terms of the Stock Awards, the Company shall keep available at
all times the number of shares of Common Stock required to satisfy such Stock Awards.

(b)    Securities Law Compliance.The Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may be required to grant Stock Awards and to issue and sell shares of Common Stock upon exercise of the Stock Awards; provided, however, that
this undertaking shall not require the Company to register under the Securities Act the Plan, any Stock Award or any Common Stock issued or issuable pursuant to any such Stock Award. If, after
reasonable efforts, the Company is unable to obtain from any such regulatory commission or agency the authority which counsel for the Company deems necessary for the lawful issuance and sale of Common
Stock under the Plan, the Company shall be relieved from any liability for failure to issue and sell Common Stock upon exercise of such Stock Awards unless and until such authority is obtained.

9. Use of Proceeds from Stock.

Proceeds
from the sale of Common Stock pursuant to Stock Awards shall constitute general funds of the Company.

10. Miscellaneous.

(a)    Acceleration of Exercisability and Vesting.The Board shall have the power to accelerate the time
at which a Stock Award may first be exercised or the time during which a Stock Award or any part thereof will vest in accordance with the Plan, notwithstanding the provisions in the Stock Award
stating the time at which it may first be exercised or the time during which it will vest.

(b)    Shareholder Rights.No Participant shall be deemed to be the holder of, or to have any of the
rights of a holder with respect to, any shares of Common Stock subject to such Stock Award unless and until such Participant has satisfied all requirements for exercise of the Stock Award pursuant to
its terms.

(c)    No Employment or other Service Rights.Nothing in the Plan or any instrument executed or Stock
Award granted pursuant thereto shall confer upon any Participant any right to continue to serve the Company or an Affiliate in the capacity in effect at the time the Stock Award was granted or shall
affect the right of the Company or an Affiliate to terminate (i) the employment of an Employee with or without notice and with or without Cause, (ii) the service of a Consultant pursuant
to the terms of such Consultant's agreement with the Company or an Affiliate or (iii) the service of a Director pursuant to the Bylaws of the Company or an Affiliate, and any applicable
provisions of the corporate law of the state in which the Company or the Affiliate is incorporated, as the case may be.

(d)    Investment Assurances.The Company may require a Participant, as a condition of exercising or
acquiring Common Stock under any Stock Award, (i) to give written assurances satisfactory to the Company as to the Participant's knowledge and experience in financial and business matters
and/or to employ a purchaser representative reasonably satisfactory to the Company who is

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knowledgeable and experienced in financial and business matters and that he or she is capable of evaluating, alone or together with the purchaser representative, the merits and risks of exercising the
Stock Award; and (ii) to give written assurances satisfactory to the Company stating that the Participant is acquiring Common Stock subject to the Stock Award for the Participant's own account
and not with any present intention of selling or otherwise distributing the Common Stock. The foregoing requirements, and any assurances given pursuant to such requirements, shall be inoperative if
(1) the issuance of the shares of Common Stock upon the exercise or acquisition of Common Stock under the Stock Award has been registered under a then currently effective registration statement
under the Securities Act or (2) as to any particular requirement, a determination is made by counsel for the Company that such requirement need not be met in the circumstances under the then
applicable securities laws. The Company may, upon advice of counsel to the Company, place legends on stock certificates issued under the Plan as such counsel deems necessary or appropriate in order to
comply
with applicable securities laws, including, but not limited to, legends restricting the transfer of the Common Stock.

(e)    Withholding Obligations.To the extent provided by the terms of a Stock Award Agreement, the
Participant may satisfy any federal, state or local tax withholding obligation relating to the exercise or acquisition of Common Stock under a Stock Award by any of the following means (in addition to
the Company's right to withhold from any compensation paid to the Participant by the Company) or by a combination of such means: (i) tendering a cash payment; (ii) authorizing the
Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable to the Participant as a result of the exercise or acquisition of Common Stock under the Stock Award,
provided, however, that no shares of Common Stock are withheld with a value exceeding the minimum amount of tax required to be withheld by law; or (iii) delivering to the Company owned and
unencumbered shares of Common Stock.

11. Adjustments upon Changes in Stock.

(a)    Capitalization Adjustments.If any change is made in the Common Stock subject to the Plan, or
subject to any Stock Award, without the receipt of consideration by the Company (through merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property
other than cash, stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or other transaction not involving the receipt of consideration by the
Company) (individually, a "Capitalization Adjustment"), the Plan will be appropriately adjusted in the class(es) and maximum number of securities subject to the Plan pursuant to subsection 4(a), and
the outstanding Stock Awards will be appropriately adjusted in the class(es) and number of securities and price per share of Common Stock subject to such outstanding Stock Awards. The Board shall make
such adjustments, and its determination shall be final, binding and conclusive. (The conversion of any convertible securities of the Company shall not be treated as a transaction "without receipt of
consideration" by the Company.)

(b)    Dissolution or Liquidation.In the event of a dissolution or liquidation of the Company, then all
outstanding Stock Awards shall terminate immediately prior to such event.

(c)    Asset Sale, Merger, Consolidation or Reverse Merger.In the event of (i) a sale, lease or
other disposition of all or substantially all of the assets of the Company, (ii) a merger or consolidation in which the Company is not the surviving corporation or (iii) a reverse merger
in which the Company is the surviving corporation but the shares of Common Stock outstanding immediately preceding the merger are converted by virtue of the merger into other property, whether in the
form of securities, cash or otherwise (individually, a "Corporate Transaction"), then any surviving corporation or acquiring corporation shall assume any Stock Awards outstanding under the Plan or
shall substitute similar stock awards (including an award to acquire the same consideration paid to the shareholders in the Corporate Transaction) for those outstanding under the Plan. In the event
any surviving corporation or
acquiring corporation refuses to assume such Stock Awards or to substitute similar stock awards for those outstanding under the Plan, then with respect to Stock Awards held by Participants whose

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Continuous Service has not terminated, the vesting of such Stock Awards (and, if applicable, the time during which such Stock Awards may be exercised) shall be accelerated in full, and the Stock
Awards shall terminate if not exercised (if applicable) at or prior to the Corporate Transaction. With respect to any other Stock Awards outstanding under the Plan, such Stock Awards shall terminate
if not exercised (if applicable) prior to the Corporate Transaction.

12. Amendment of the Plan and Stock Awards.

(a)    Amendment of Plan.The Board at any time, and from time to time, may amend the Plan. However,
except as provided in Section 11 relating to adjustments upon changes in Common Stock, no amendment shall be effective unless approved by the shareholders of the Company to the extent
shareholder approval is necessary to satisfy the requirements of Section 422 of the Code, Rule 16b-3 or any Nasdaq or securities exchange listing requirements.

(b)    Shareholder Approval.The Board may, in its sole discretion, but is not obligated to, submit the
Plan or any amendment to the Plan for shareholder approval, including, but not limited to, amendments to the Plan intended to satisfy the requirements of Section 162(m) of the Code and the
regulations thereunder regarding the exclusion of performance-based compensation from the limit on corporate deductibility of compensation paid to certain executive officers.

(c)    Contemplated Amendments.It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide eligible Employees with the maximum benefits provided or to be provided under the provisions of the Code and the regulations promulgated
thereunder and/or to bring the Plan and/or Options granted under it into compliance therewith.

(d)    No Impairment of Rights.Rights under any Stock Award granted before amendment of the Plan shall
not be impaired by any amendment of the Plan unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing.

(e)    Amendment of Stock Awards.The Board at any time, and from time to time, may amend the terms of any
one or more Stock Awards; provided, however, that the rights under any Stock Award shall not
be impaired by any such amendment unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing.

13. Termination or Suspension of the Plan.

(a)    Plan Term.The Board may suspend or terminate the Plan at any time. Unless sooner terminated, the
Plan shall terminate on the day before the tenth (10th) anniversary of the date the Plan is adopted by the Board. No Stock Awards may be granted under the Plan while the Plan is suspended or after it
is terminated.

(b)    No Impairment of Rights.Suspension or termination of the Plan shall not impair rights and
obligations under any Stock Award granted while the Plan is in effect except with the written consent of the Participant.

14. Effective Date of Plan.

The
Plan shall become effective as determined by the Board.

15. Choice of Law.

The
law of the State of California shall govern all questions concerning the construction, validity and interpretation of this Plan, without regard to such state's conflict of laws
rules.

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