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Document Security Systems Signs Licensing Agreement with The Reynolds and Reynolds Company

ROCHESTER, N.Y.--May 16, 2006--Document Security Systems, Inc. (AMEX: DMC) ("DSS"), a leader in proven, patented protection against counterfeiting and unauthorized copying, scanning and photo imaging, announced today it has signed a licensing contract for its AuthentiGuard(TM) Pantograph 4000 and AuthentiGuard(TM) Survivor 21 anti-counterfeiting technologies with The Reynolds and Reynolds Company , a leading software and services provider for the automotive retailing market in the United States and Canada.

Mr. Patrick White, Chairman, President and Chief Executive Officer of DSS, stated, "Reynolds selected our security technologies because of the high degree of insurance they can provide their customers regarding the authenticity and protection of their checks and forms. Reynolds, a business services company for automotive dealers and OEMs, measurably extends our market reach in the automotive industry. This agreement is consistent with our strategy to selectively license our technology to large established companies that serve a broad customer base to drive our long-term revenue growth. This contract represents a large step forward towards our goal to establish AuthentiGuard(TM) Pantograph 4000 and AuthentiGuard(TM) Survivor 21 as the standards for the check protection industry."

Reynolds and Reynolds helps automobile dealers sell cars and take care of customers. Serving dealers since 1927, it is a leading provider of dealer management systems in the U.S. and Canada. The company's award-winning product, service and training solutions include a full range of retail Web and Customer Relationship Management solutions, e-learning and consulting services, documents, data management and integration, networking and support and leasing services.

AuthentiGuard(TM) Survivor 21 was designed to improve the security of checks processed digitally through financial institutions in full compliance with Federal Reserve Board Check 21 rules. AuthentiGuard(TM) Survivor 21 employs a covert security icon incorporated into the check background. This image cannot be seen by the human eye, yet when it is scanned by high-speed check imaging equipment it appears in an unobtrusive section of the resulting check image. The bank or bank customer receiving this image can then be assured that they are looking at an authentic check. Document Security Systems partnered with NCR Corporation in developing the surviving check scan feature.

The AuthentiGuard(TM) Pantograph 4000 is a powerful, new patent-pending void pantograph technology that employs a hidden pantograph background for use in financial instruments such as checks, money orders, gift certificates, rebates, coupons and vital records. The patent-pending void pantograph embeds hidden warning words, logos, and designs into the document background. Images appear when using a handheld verifier, or when the document is scanned on a desktop scanner or digital copier. Any printed communication materials using the technology will reveal hidden words such as "VOID" or "UNAUTHORIZED COPY" when they are copied or scanned on a black and white copier, color copier or desktop scanner.

DSS's AuthentiGuard(TM) technologies represent the leading anti-counterfeiting print security technologies on the market today and are the only known print security technologies that work with essentially all of the current models of digital copiers, printers and desktop scanners.

For competitive reasons, and at the request of the customer, the value of the contract cannot be disclosed.

About Document Security Systems, Inc.

Document Security Systems, Inc. (AMEX: DMC) is a leader in proven patented protection against counterfeiting and unauthorized copying, scanning and photo imaging. The company offers a broad portfolio of anti-counterfeiting technologies, processes and products, and provides consulting for customized document security printing solutions. Its various anti-scanning technologies and products are used for currency, vital records, packaging, labels, tickets, ID Cards, passports and gift certificates. Document Security Systems' products, such as its new AuthentiGuard(TM) Security Paper, protect original documents from copying or duplication. Its strategy is to become the world's leading producer of cutting-edge security technologies for printed products. More information about Document Security Systems can be found at its websites: www.documentsecurity.com and www.plasticprintingprofessionals.com.

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.