On-Point Technology Systems Inc. Announces Letter of Intent to Develop On-Line and Internet Lottery in Peru.

Business Editors

SAN MARCOS, Calif.--(BUSINESS WIRE)--Nov. 8, 2000

On-Point Technology Systems Inc. (On-Point) (Nasdaq:ONPT) today announced that it has signed a letter of intent to acquire a 51-percent interest in a venture that has the rights to develop the first On-Line and Internet lottery in Peru.

The opportunity to develop this lottery was facilitated by Victor Chandler International Limited (VCI), On-Point's strategic international partner. If a definitive agreement, which is subject to a number of conditions, is completed, On-Point would have the opportunity to operate one of only a small number of non state-owned lotteries in the world. Peru has a population base of over 24 million people.

Michael Carlton, VCI's managing director, commented, "We are pleased to be able to facilitate bringing together the parties capable of proceeding forward with this exciting opportunity. VCI's and On-Point's joint technologies and strategic visions are well suited to developing the first On-Line and Internet lottery in Peru. We expect this opportunity to be one of only a series of international opportunities we bring to On-Point."

Frederick Sandvick, the chairman and chief executive officer of On-Point, commented, "As we announced earlier this week, the completion of an international alliance with VCI has established a solid strategic relationship for On-Point that can jump start the launch of our new technology for lotteries. The first opportunity is the development of an On-Line and Internet lottery in Peru. This opportunity provides for us a forum to showcase our next generation dispensing technology for instant scratch games and introduce the world's first On-Line instant scratch game. We are excited about the potential of this new On-Line process, which, if successful, can provide an enormous worldwide market for On-Point. The opportunity also provides for us a forum to launch an Internet lottery, which we also believe can achieve positive returns."

The letter of intent is subject to a number of conditions and no assurances can be given that a definitive agreement or the transaction will be completed.

About On-Point

On-Point provides effective technologies for transaction automation. On-Point pioneered the development of the instant ticket vending machine for lotteries worldwide and is one of the world's largest providers of these and other high-security vending products. On-Point designs, sells, leases and services high-security vending machines both domestically and internationally and has begun to explore the development of automated electronic solutions for high-volume, cash-oriented transactions.

Any forward-looking statements in this release are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Act of 1995. Investors are cautioned that actual results may differ substantially from such forward-looking statements. Forward-looking statements involve risks and uncertainties including, but not limited to, the successful completion of proposed equity raises, the successful negotiation of a final agreement for the Peru lottery opportunity, continued acceptance of the company's products and services in the marketplace, competitive factors, new products and technological changes, the company's successful entry into new markets, the company's successful transition to its next generation product line, dependence upon third-party vendors, a limited number of customers, political and other uncertainties related to customer purchases, the ability to generate cash flow sufficient to sustain operating activities, and other risks detailed in the company's periodic filings with the Securities and Exchange Commission.