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NEC Corporation/Alanco Announce Strategic
Marketing Agreement Letter of Intent


Multimillion Dollar Purchase Commitment with Substantial Prepayment

(Scottsdale, AZ - March 30, 2005) - Alanco Technologies, Inc. (NASDAQ: ALAN) today announced it has entered into a Letter of Intent (LOI) with Tokyo-based NEC Corporation (“NEC”) to structure a Strategic Marketing Agreement which grants NEC certain rights to sell TSI PRISM™ RFID (Radio Frequency Identification) technology non-exclusively in Japan and exclusively in certain other Asian markets.  The agreement will be based upon a minimum multi-million dollar purchase commitment from NEC for TSI PRISM products and services and include a substantial pre-payment to Alanco.  A definitive agreement is anticipated to be signed within thirty days.

The TSI PRISM system provides correctional facilities with a state-of-the-art tool for managing their inmate population while increasing overall safety.  The RFID real-time tracking system conducts a continuous, automated headcount that includes the location and name of every monitored inmate and officer.  The system simultaneously alerts central control of the name and location of any officer who needs immediate assistance, or if an inmate leaves or enters a pre-designated area.  The TSI PRISM system helps reduce prison violence and reduces overall facility costs by enhancing efficiencies and providing for comprehensive manpower review and analysis. The TSI PRISM system is currently utilized in prisons in Michigan, California, Illinois, and a new Ohio installation. 

NEC established an RFID Business Promotion Center in January of this year with 300 employees, developing a comprehensive RFID solution business from chip supply to system integration.  “The relationship with Alanco will continue to build and support NEC’s commitment to the RFID market and provide an effective tool for our customers to both increase their operational efficiencies and provide enhanced safety within the prisons,” said Masahito Ito, Manager, International Business Promotions Division, NEC Corporation.  “Alanco’s TSI PRISM system not only provides state-of-the-art RFID technology within the prison market, but true value to our customers.”

Alanco’s Chairman and Chief Executive Officer, Robert Kauffman, commented, “As we accelerate our TSI PRISM market penetration, a consensus is forming in the corrections community that our RFID tracking technology represents a major, long overdue, advance in efficient and safe prison management.  We believe that this strategic marketing agreement with NEC Corporation, one of the world’s leading technology companies, will underscore the worldwide dimensions of our TSI PRISM market opportunity.  Over the past eight months we have developed an excellent relationship with NEC relative to several specific Asian projects, and look forward to working with this great company to fully develop our Asian market opportunities.”

NEC Solutions (America), Inc., a wholly owned subsidiary of NEC Corporation which offers specialized eGovernment solutions in public safety for federal, state and local governments in North America, will spearhead the Strategic Marketing Agreement with Alanco, both domestically and internationally to develop new market opportunities for TSI PRISM for NEC’s worldwide base of customers.  “NEC’s legacy in the eGovernment marketplace boasts a firm commitment to improving public safety and easing the daily duties of public safety officials,” said Greg Spadorcio, General Manager of the Public Safety Solutions Division of NEC Solutions America. “Our relationship with Alanco and the implementation of the TSI PRISM system will allow us to continue that tradition.”

Alanco Technologies, Inc. (NASDAQ: ALAN), headquartered in Scottsdale, Arizona, is the developer of the TSI PRISM RFID continuous tracking system for the corrections industry, which tracks the location and movement of inmates and officers, resulting in significant prison operating cost reductions and enhanced officer safety and facility security.  Utilizing RFID (Radio Frequency Identification) tracking technology with proprietary software and patented hardware components, TSI PRISM provides real-time inmate and officer identification, location and tracking capabilities both indoors and out.  The Company also participates in the data storage industry through two subsidiary companies:  Arraid, Inc., a manufacturer of proprietary storage products to upgrade older “legacy” computer systems; and Excel/Meridian Data, Inc., a manufacturer of Network Attached Storage (NAS) systems.

About NEC Corporation
NEC is one of the world's leading providers of Internet, broadband network and enterprise business solutions dedicated to meeting the specialized needs of its diverse and global base of customers.  Ranked as one of the world's top patent-producing companies, NEC delivers tailored solutions in the key fields of computer, networking and electron devices, by integrating its technical strengths in IT and Networks, and by providing advanced semiconductor solutions through NEC Electronics Corporation.  The NEC Group employs more than 140,000 people worldwide and had net sales of approximately $43 billion in the fiscal year ended March 2004.  For additional information, please visit the NEC home page at: http://www.nec.com.

About NEC Solutions America
NEC Solutions (America), Inc. is a premier provider of integrated solutions for the Connected Enterprise in North America.  As an affiliate of NEC Corporation (NASDAQ: NIPNY) (FTSE: 6701q.1), NEC Solutions America taps into a global resource network to help clients leverage technology to achieve a competitive edge.  From corporate performance management and biometric security solutions to digital cinema and in-theatre advertising systems, visual displays and server solutions, the expertise is delivered with the personal attention needed to address individual situations.  With headquarters in Rancho Cordova, California, NEC Solutions America serves a wide range of markets, including the health care and public safety, financial services, cinema, retail and manufacturing markets. Information regarding NEC Solutions America can be found at www.necsam.com.

Except for historical information, the statements contained in this press release are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All such forward-looking statements are subject to, and are qualified by, risks and uncertainties that could cause actual results to differ materially from those expressed or implied by those statements. These risks and uncertainties include, but are not limited to, reduced demand for information technology equipment; competitive pricing and difficulty managing product costs; development of new technologies which make the Company’s products obsolete; rapid industry changes; failure of an acquired business to further the Company’s strategies; the ability to maintain satisfactory relationships with lenders and to remain in compliance with financial loan covenants and other requirements under current banking agreements; and the ability to secure and maintain key contracts and relationships.


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