The proposed casino and entertainment facility will occupy approximately 50 acres on the Pala Reservation land located in San Diego County, California approximately 15 miles north of Escondido five miles off Interstate 15. Under the agreements, subsidiaries of Anchor Gaming will develop a casino and entertainment facility for the Pala Tribe and assist in obtaining financing for the project. Anchor Gaming will render management services to the Pala Tribe for the facility for a seven-year period after its completion. Anchor Gaming and an investment group lead by Jerome H. Turk, of Las Vegas and San Diego, will generally share equally in the profit of the development and management activities.

The agreements are subject to California voter approval of a proposed amendment to the California Constitution to permit a form of legalized gaming on California Native American Reservations. The proposed amendment is scheduled to appear on the March 2000 ballot and is intended to ratify the tribal gaming compact signed by California Governor Gray Davis on September 10, 1999. The agreements are also subject to approvals by various regulatory and licensing agencies.

The current development budget of approximately $90 million, which has not been finalized and is subject to change, calls for a 150,000 square foot casino and entertainment facility. The facility will be designed to accommodate more than 1,500 gaming machines and more than 40 table games, as well as ample food and beverage and entertainment offerings. The Company, expecting passage of the constitutional amendment, plans to open the facility before March 31, 2001.

Robert Smith, Tribal Council Chairman of the Pala Band of Mission Indians stated, “For many years our Tribe has been patiently awaiting the right opportunity to participate in gaming in the state of California. A favorable legal framework has finally been established, we have found the right partner and we are looking forward to realizing our long time hope of taking Indian gaming in Southern California to the next level.”

Anchor Gaming’s CEO and President, Michael Rumbolz, added, “We are proud to be associated with the Pala Band of Mission Indians and look forward to working with them and with long time gaming and well respected financial executive Jerry Turk.  This is just the type of opportunity that allows us to capitalize on our many years of experience in successfully managing gaming operations.”

Anchor Gaming is a diversified gaming technology company serving states, municipalities, and gaming programs around the world. Anchor Gaming develops and distributes unique proprietary games, manufactures and distributes gaming devices to casinos, operates two casinos in Colorado and one racetrack/casino in New Mexico, and operates gaming-machine routes in Nevada and Montana. Through its operating units AWI, VLC, and United Tote, Anchor Gaming supplies system software, equipment, and related services to on-line lotteries, video lotteries, casinos, and pari-mutuel organizations throughout the world. Presently, the Company’s equipment and systems are in operation in the United States, Canada, Australia, Europe, South America, South Africa, and the Caribbean.

This press release contains certain forward-looking statements within the meaning of section 21e of the Securities Exchange Act of 1934, as amended, and other applicable securities laws.