PhotoWorks, Inc. (Nasdaq:FOTO - news), the leading Internet photo services company, announced today a definitive purchase agreement to acquire the ememories.com Web Site from ememories, Inc. The transaction is expected to close within 60 days.

``ememories.com is a photo-related Web site dedicated to providing users with an online community for showcasing memories through photo sharing and online photo album creation,'' said Howard Lee, PhotoWorks President and CEO. ``This agreement gives ememories' users continued access to their online photos and albums through PhotoWorks services and products. The ememories.com technology will enable us to more effectively develop products and services we have been planning. It will also allow PhotoWorks the opportunity to leverage our existing infrastructure and further solidify our position in the industry.''

During the transition period, ememories will continue to operate the Web site and will contact its users to notify them of the changes in services and products. As part of the agreement, PhotoWorks will transition the ememories' photo archives into the PhotoWorks online photo archives.

About PhotoWorks®

PhotoWorks is the leading Internet photo services company dedicated to providing its customers with innovative ways to enjoy and use their photos. The PhotoWorks service provides both traditional and digital camera owners with the easiest way to archive and organize photos online, share them with friends and family, and order reprints, photo albums and other gifts.

PhotoWorks draws upon a unique dual heritage as a top-rated photofinisher with over twenty years of experience along with a tradition of innovation and leadership in digital and online photo services. PhotoWorks was the first to offer free scanning, online archiving and e-mail sharing services to both traditional and digital camera users, and hosts the largest consumer online photo archive in the world, currently with over 175 million images.

Based in Seattle, PhotoWorks, Inc. (Nasdaq:FOTO - news) was founded in 1978. The Company generated over $76 million in net revenues for the 12 months ended December 30, 2000. More information is available at www.photoworks.com or by calling 800/746-8696.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:

Statements in this news release concerning leadership in online digital imaging and photo-sharing, expected closing date, growth of archive as an indicator of future business activities, marketing initiatives, future products, services and opportunities in online digital imaging and photo sharing, and any other statement which may be construed as a prediction of future capabilities, performance or events are forward-looking statements, the occurrence of which are subject to a number of known and unknown risks and uncertainties which might cause actual performance to differ materially from those expressed or implied by such statements. These risks and uncertainties include the possibility of delays in the expansion of image storage capacity due to delays in deliveries from suppliers or technical problems; system performance problems due to technical difficulties, system malfunctions, Internet interruptions or other factors; pricing and other activities by competitors; and other risks including those described in the Company's Annual Report on Form 10-K and those described from time to time in the Company's other filings with the Securities and Exchange Commission, press releases and other communications.