EXHIBIT 99.1

PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 - SAFE HARBOR FOR
FORWARD-LOOKING STATEMENTS

The Private Securities Litigation Reform Act of 1995 provides
a safe-harbor for forward-looking statements made by public companies.  This
safe-harbor protects a company from securities law liability in connection with
forward-looking statements if the company complies with the requirements of the
safe-harbor.  As a public company, the Company has relied and will continue to
rely on the protection of the safe harbor in connection with its written and
oral forward-looking statements.

When evaluating the Company's business, you should consider:

- all of the information in this quarterly report on Form
10-QSB;
- the risk factors described in the Company's Form 10-KSB
filed with the Securities and Exchange Commission on April 2, 2001; and
- the risk factors described below.

RISK FACTORS

Although the Company believes that the expectations reflected
in its forward-looking statements are reasonable, the Company cannot guarantee
future results, levels of activity, performance or achievements or other future
events.  Moreover, neither the Company nor anyone else assumes responsibility
for the accuracy or completeness of forward-looking statements.  You should
consider the Company's forward-looking statements in light of the following risk
factors and other information in this quarterly report.  If any of the risks
described below occurs, the Company's business, results of operation and
financial condition could differ from those projected in its forward-looking
statements.  The Company is under no duty to update any of its forward-looking
statements after the date of the quarterly report.  You should not place undue
reliance on forward-looking statements.

Limited Operating History; History of Losses; Increased Expenses

Imagis commenced operations in March 1998 and, therefore, has
only a limited operating history upon which an evaluation of its business and
prospects can be based.  Imagis and its predecessors incurred net losses of
$3,010,031 and $2,110,786 in the years ended December 31, 2000 and December 31,
1999, respectively.  Imagis has never been profitable and there can be no
assurance that, in the future, Imagis will be profitable on a quarterly or
annual basis.  Imagis plans to increase its operating expenses to expand its
sales and marketing operations, fund greater levels of research and development,
broaden its customer support capabilities and increase its administration
resources. In view of the rapidly evolving nature of Imagis' business and
markets and limited operating history, Imagis believes that period-to-period
comparisons of financial results are not necessarily meaningful and should not
be relied upon as an indication of future performance.

The Auditor's Report on Imagis' December 31, 2000
Consolidated Financial Statements includes additional comments by the auditor on
Canada-United States reporting differences that indicate the financial
statements are affected by conditions and events that cast substantial doubt on
Imagis' ability to continue as a going concern.  The financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.

Need for Additional Financing

Revenue from Imagis' operations is not sufficient to finance
the cost of development and marketing of its technology.  Accordingly, Imagis
estimates that it must raise approximately $400,000 in additional funding to
fund its capital requirements for 2001.  There is no assurance that Imagis will
be able to secure financing or that such financing will be obtained on terms
favorable to Imagis.  Failure to obtain adequate financing could result in
significant delays in development of new products and a substantial curtailment
of operations.

---

New Product Development

Imagis expects that a significant portion of its future
revenue will be derived from the sale of newly introduced products and from
enhancement of existing products, such as CABS and ID-2000.  See "Note
Regarding Forward-Looking Statements." Imagis' success will depend in part
upon its ability to enhance its current products and to install such products in
end-user applications on a timely and cost-effective basis.  In addition, the
Company must develop new products that meet changing market conditions,
including changing customer needs, new competitive product offerings and
enhanced technology.  There can be no assurance that Imagis will be successful
in developing and marketing on a timely and cost-effective basis, new products
and enhancements that respond to such changing market conditions.  If Imagis is
unable to anticipate or adequately respond on a timely or cost-effective basis
to changing market conditions, to develop new software products and enhancements
to existing products, to correct errors on a timely basis or to complete
products currently under development, or if such new products or enhancements do
not achieve market acceptance, Imagis' business, financial condition, operating
results and cash flows could be materially adversely affected.  In light of the
difficulties inherent in software development, Imagis expects that it will
experience delays in the completion and introduction of new software products.
See "Note Regarding Forward-Looking Statements."

Lengthy Sales Cycles

The purchase of a computerized arrest and booking system is
often an enterprise-wide decision for prospective customers and requires Imagis
(directly or through its business partners) to engage in sales efforts over an
extended period of time and to provide a significant level of education to
prospective customers regarding the use and benefits of such systems.  In
addition, an installation generally requires approval of a governmental body
such as municipal, county or state government, which can be a time-intensive
process and require months before a decision to be made.  Due in part to the
significant impact that the application of CABS has on the operations of a
business and the significant commitment of capital required by such a system,
potential customers tend to be cautious in making acquisition decisions.  As a
result, Imagis' products generally have a lengthy sales cycle ranging from three
(3) to nine (9) months.  Consequently, if sales forecast from a specific
customer for a particular quarter are not realized in that quarter, the Company
may not be able to generate revenue from alternative sources in time to
compensate for the shortfall.  The loss or delay of a large contract could have
a material adverse effect on Imagis' quarterly financial condition, operating
results and cash flows, which may cause such results to be less than analysts'
expectations.  Moreover, to the extent that significant contracts are entered
into and required to be performed earlier than expected, operating results for
subsequent quarters may be adversely affected.

Dependence on a Small Number of Customers

Imagis derives a substantial portion of its revenues, and it
expects to continue to derive a substantial portion of its revenues in the near
future, from sales to a limited number of customers, in particular the Alameda
County, California police departments through Orion Scientific Systems, Inc.
Unless and until the Company further diversifies and expands its customer base,
the Company's success will depend significantly upon the timing and size of
future purchase orders, if any, from its largest customers, as well as their
product requirements, financial situation, and, in particular, the successful
deployment of services using the Company's products.  The loss of any one or
more of these customers, significant changes in their product requirements,
delays of significant orders could have a material adverse affect upon the
Company's business, operating results and financial condition.

Dependence on Key Personnel

Imagis' performance and future operating results are
substantially dependent on the continued service and performance of its senior
management and key technical and sales personnel.  Imagis intends to hire a
number of additional technical and sales personnel.  Competition for such
personnel is intense, and there can be no assurance that Imagis can retain its
key technical, sales and managerial employees or that it will be able to attract
or retain highly qualified technical and managerial personnel in the future.
The loss of the services of any of Imagis' senior management or other key
employees or the inability to attract and retain the necessary technical, sales
and managerial personnel could have a material adverse effect upon Imagis'
business, financial condition, operating results and cash flows.  With the
exception of Andy Amanovich, the Company's Chief Technology Officer, and

---

David
Lutes, the Company's Chief Engineer, Imagis does not currently maintain
"key man" insurance for any senior management or other key
employees.

Dependence on Marketing Relationships

Imagis' products are primarily marketed by Imagis' business
partners.  Imagis' existing agreements with business partners of its products
are nonexclusive and may be terminated by either party without cause.  Such
organizations are not within the control of Imagis, are not obligated to
purchase products from Imagis and may also represent and sell competing
products.  There can be no assurance that Imagis' existing business partners
will continue to provide the level of services and technical support necessary
to provide a complete solution to Imagis' customers or that they will not
emphasize their own or third-party products to the detriment of Imagis'
products.  The loss of these business partners, the failure of such parties to
perform under agreements with Imagis or the inability of Imagis to attract and
retain new business with the technical, industry and application experience
required to market Imagis' products successfully could have a material adverse
effect on Imagis' business, financial condition, operating results and cash
flows.

Additionally, with respect to most sales, Imagis supplies
products and services to a customer through a third-party supplier acting as a
project manager or systems integrator.  In such circumstances, Imagis has a
sub-contract to supply its products and services to the customer through the
prime contractor.  In these circumstances, Imagis is at risk that situations may
arise outside of its control that could lead to a delay, cost over-run or
cancellation of the prime contract which could also result in a delay, cost
over-run or cancellation of Imagis' sub-contract.  The failure of a third-party
supplier to supply its products and services or perform its contractual
obligations to the customer in a timely manner could have a material adverse
effect on Imagis' financial condition, results of operations and cash flows.

Competition

The markets for arrest and booking systems, and facial
recognition software are highly competitive.  Numerous factors affect Imagis'
competitive position, including supplier competency, product functionality,
performance and reliability of technology, depth and experience in distribution
and operations, ease of implementation, rapid deployment, customer service and
price.

Imagis primarily competes in the arrest and booking systems
market with ImageWare Software, Smith & Wesson and Spillman.  Imagis'
primary competitors in the facial recognition software market with  Miros
(Trueface), Viisage Technology (Viisage Gallery) and Visionics (FaceIt).

Certain of Imagis' competitors have substantially greater
financial, technical, marketing and distribution resources than Imagis.  As a
result, they may be able to respond more quickly to new or emerging technologies
and changing customer requirements, or to devote greater resources to the
development and distribution of existing products.  There can be no assurance
that Imagis will be able to compete successfully against current or future
competitors or alliances of such competitors, or that competitive pressures
faced by Imagis will not materially adversely affect its business, financial
condition, operating results and cash flows.

Proprietary Technology

Imagis' success will be dependent upon its ability to protect
its intellectual property rights.  Imagis relies principally upon a combination
of copyright and trade secret laws, non-disclosure agreements and other
contractual provisions to establish and maintain its rights.  The source codes
for Imagis' products and technology are protected both as trade secrets and as
unpublished copyrighted works.  To date, Imagis has not applied for any patents
or trademarks.  As part of its confidentiality procedures, Imagis enters into
nondisclosure and confidentiality agreements with each of its key employees,
consultants, distributors, customers and corporate partners, to limit access to
and distribution of its software, documentation and other proprietary
information.  There can be no assurance that Imagis' efforts to protect its
intellectual property rights will be successful.  Despite Imagis efforts to
protect its intellectual property rights, unauthorized third-parties, including
competitors, may be able to copy or reverse engineer certain portions of Imagis'
software products, and use such copies to create competitive products.

Policing the unauthorized use of Imagis' products is
difficult, and, while Imagis is unable to determine the extent to which piracy
of its software products exists, software piracy can be expected to continue.
In addition, the laws of

---

certain countries in which Imagis' products are or may be
licensed do not protect its products and intellectual property rights to the
same extent as do the laws of Canada and the United States.  As a result, sales
of products by Imagis in such countries may increase the likelihood that Imagis'
proprietary technology is infringed upon by unauthorized third-parties.

In addition, because third-parties may attempt to develop
similar technologies independently, Imagis expects that software product
developers will be increasingly subject to infringement claims as the number of
products and competitors in Imagis' industry segments grow and the functionality
of products in different industry segments overlaps.  There can be no assurance
that third-parties will not bring infringement claims (or claims for
indemnification resulting from infringement claims) against Imagis with respect
to copyrights, trademarks, patents and other proprietary rights.  Any such
claims, whether with or without merit, could be time consuming, result in costly
litigation and diversion of resources, cause product shipment delays or require
Imagis to enter into royalty or licensing agreements.  Such royalty or licensing
agreements, if required, may not be available on terms acceptable to Imagis or
at all.  A claim of product infringement against Imagis and failure or
inability of Imagis to license the infringed or similar technology could have a
material adverse effect on Imagis' business, financial condition, operating
results and cash flows.

Exchange Rate Fluctuations

Because Imagis' reporting currency is the Canadian
dollar, its operations outside Canada face additional risks, including
fluctuating currency values and exchange rates, hard currency shortages and
controls on currency exchange.  Imagis does not currently engage in hedging
activities or enter into foreign currency contracts in an attempt to reduce
Imagis' exposure to foreign exchange risks.  In addition, to the extent Imagis
has operations outside Canada, Imagis is subject to the impact of foreign
currency fluctuations and exchange rate charges on Imagis' reporting in its
financial statements of the results from such operations outside Canada.  Since
such financial statements are prepared utilizing Canadian dollars as the basis
for presentation, results from operations outside Canada reported in the
financial statements must be restated into Canadian dollars utilizing the
appropriate foreign currency exchange rate, thereby subjecting such results to
the impact of currency and exchange rate fluctuations.

Risk of Software Defects

Software products as complex as those offered by Imagis
frequently contain errors or defects, especially when first introduced or when
new versions or enhancements are released.  Despite product testing, Imagis has
in the past released products with defects in certain of its new versions after
introduction and experienced delays or lost revenue during the period required
to correct these errors.  Imagis regularly introduces new versions of its
software.  There can be no assurance that, despite testing by Imagis and its
customers, defects and errors will not be found in existing products or in new
products, releases, versions or enhancements after commencement of commercial
shipments.  Any such defects and errors could result in adverse customer
reactions, negative publicity regarding Imagis and its products, harm to the
Imagis' reputation, loss or delay in market acceptance or required product
changes, any of which could have a material adverse effect upon its business,
results of operations, financial condition and cash flows.

Product Liability

The license and support of products by the Company may entail
the risk of exposure to product liability claims.  A product liability claim
brought against the Company or a third-party that the Company is required to
indemnify, whether with or without merit, could have a material adverse effect
on the Company's business, financial condition, operating results and cash
flows.

Directors' and Officers' Involvement in Other Projects

Many of the officers and directors of Imagis serve as
directors, officers and/or employees of companies other than Imagis.  While
Imagis believes that such officers and directors will be devoting adequate time
to effectively manage Imagis, there can be no assurance that such other
positions will not negatively impact an officer's or director's duties for
Imagis.