Iteris Holdings Inc. Completes Purchase of Preferred Minority Stockholder Interest

ANAHEIM, Calif.--June 1, 2004--Iteris Holdings (OTCBB:ITRSA)(OTCBB:ITRSB), today announced that it has completed the purchase of all of the Preferred Stock of its operating subsidiary, Iteris Inc., from Daimler Chrysler Ventures (DCV) and the Government Investment Corp. of Singapore (GIC) in exchange for a cash payment of approximately $17.5 million in cash.

The purchase price represented the stated redemption value of the Preferred Stock held by DCV and GIC. The purchase was financed principally with $10 million in subordinated convertible debentures issued earlier this month to a group of institutional investors, in addition to a senior credit facility arranged through the company's primary lender, Wells Fargo Bank. As part of the purchase agreement, Daimler Chrysler Ventures will exchange 547,893 of its shares of Common Stock held in Iteris Inc. for 1,219,445 shares of Class A Common Stock of Iteris Holdings.

"This purchase is another important step in our previously stated goals regarding the reconsolidation of Iteris Holdings and its operating subsidiary, Iteris Inc. Upon completion of this transaction, Iteris Holdings owns approximately 80 percent of Iteris Inc., and the residual 20 percent minority interest consists entirely of common stockholders of Iteris Inc. We are pleased that Daimler Chrysler, who has made important strategic contributions to the business, will continue to be a significant stockholder of the company," said Greg Miner, CEO of Iteris Holdings.

About Iteris Holdings Inc.

Iteris Holdings Inc. is the majority stockholder of Iteris Inc., a leading provider of outdoor machine vision systems and sensors that enhance driver safety and optimize the flow of traffic. The company has combined outdoor image processing, traffic engineering, and information technology to offer a broad range of transportation and safety solutions. Iteris Holdings and Iteris Inc. have headquarters in Anaheim. Investors are encouraged to contact the company at 714-774-5000, or at www.iteris.com.

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

This release contains forward-looking statements based on our current expectations, estimates and projections about our industry, management's beliefs, and certain assumptions made by us. Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," "may," "will" and variations of these words or similar expressions are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding our reconsolidation strategy. These statements speak only as of the date hereof and are subject to change. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. Important factors that may cause such a difference include, but are not limited to, the negotiation and completion of the definitive consolidation documents, the market price of our Class A common stock, our operating results and general economic, political and market conditions. Further information on Iteris Holdings Inc., including additional risk factors that may affect our forward looking statements, is contained in our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q and our other SEC filings that are available through the SEC's EDGAR database (www.sec.gov) or from the company.