I.D. Systems, Inc. Raises Approximately $6.2 Million in Private Placement; Funds Earmarked for Programs to Stimulate and Support Sales Growth with Major Customers

    HACKENSACK, N.J.--Jan. 23, 2002--I.D. Systems, Inc. announced today the closing of a private placement of 821,250 shares of common stock at $8.00 per share with institutional investors. Net proceeds of the financing were $6,165,000, which does not include proceeds that may be received upon the exercise of the placement agent's warrant to purchase an additional 82,125 shares at $9.58 per share. Sanders Morris Harris acted as the exclusive placement agent for this private placement.
    The Company plans to use the net proceeds to accelerate sales and marketing activities as well as for general corporate purposes and working capital to support anticipated growth. The private placement financing was undertaken to enable I.D. Systems to continue to transition pilot programs into enterprise-wide implementations for its Fortune 500 customers.
    Jeffrey Jagid, Chairman and Chief Executive Officer of I.D. Systems, said, "We are very pleased to consummate this transaction and gratified by the confidence our new investors have placed in the future of I.D. Systems. We believe this financing will help accelerate our business plan and put the Company in a strong position to support our next phase of growth. With this equity investment, we believe our Company is in its best position ever to fully exploit the commercial opportunities of our proven, patented technology by turning pilot programs into large-scale implementations."
    "The infusion of approximately $6.2 million substantially strengthens our balance sheet," added Ned Mavrommatis, I.D. Systems' Chief Financial Officer. "With our existing cash position, this private placement leaves us with more than $1.70 per share in cash. The Company also continues to have no debt."

    About I.D. Systems

    Based in Hackensack, New Jersey, I.D. Systems, Inc. is a leading provider of wireless solutions for corporate asset management. I.D. Systems' customers include British Airways, DaimlerChrysler, Deere & Co., Ford Motor Co., General Motors, Hallmark Cards, the Union Pacific Railroad, the U.S. Navy, and the U.S. Postal Service. Using local area networks, wide area networks, and the Internet, the company's systems enable management to control and track the location and status of their assets--from letters and containers to forklifts and railcars--in real time. For more information on I.D. Systems, Inc., visit www.id-systems.com.

    "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward looking statements that are subject to risk and uncertainties, including, but not limited to, the impact of competitive products, product demand and market acceptance risks, fluctuations in operating results and other risks detailed from time to time in I.D. Systems' filings with the Securities and Exchange Commission. These risks could cause I.D. Systems' actual results for the current fiscal year and beyond to differ materially from those expressed in any forward looking statements made by, or behalf of, I.D. Systems.