ESSENTIAL REALITY ANNOUNCES P5 VERSION OF LIONHEAD’S POPULAR “BLACK & WHITE” GAME IS COMPLETE

SOFTWARE PATCH NOW AVAILABLE FOR DOWNLOAD

New York, NY, April 3, 2003 –Essential Reality, Inc., (NASDAQ OTCBB: ESSR), a developer and distributor of technology-based consumer electronics, announced today that the integration of its P5 technology into Lionhead’s popular PC game, “Black & White”, is complete. The enhanced version is now available free of charge to current Black & White users and can be obtained by downloading a software patch from both the Essential Reality and Lionhead web sites.

“We believe that the enhanced version of Black & White is unlike any other in that it is the first game to truly demonstrate the full extent of the P5’ s capabilities. We’ve gone to great lengths to ensure that it not only delivers the ultimate P5 experience, but that it simplifies any possible learning curve as well,” said Martin Currie, VP of Business Development at Essential Reality. “By incorporating a high degree of customization, including voice-overs and tutorials that literally guide users through the experience step by step, we have achieved a new, exciting and highly intuitive alternative for interacting with this already established game that has a large and avid fan base.”

In addition to the customized voice-overs, tutorials and icons, the enhanced version of Black & White provides users with many other features such as using their real hand to navigate swiftly through their kingdom, picking up and throwing objects as naturally as they would in real life, casting spells like a true deity with simple hand movements, and even punishing and rewarding their Black & White “creature” with real hand movements.

Recently launched in early November, the P5 is a glove-like device that utilizes proprietary bend sensor and tracking technologies to enable full interaction with 3D environments. Following the release of the enabled version of Serious Sam II, Black & White is the second major title to supplement the three P5-enabled games already included with the premier edition of the P5: Hitman 2, Tiger Hunt and a demo version of Beach Head 2002.

“The release of the P5-enbled version of Black & White marks an important milestone in our ongoing pursuit to provide a range of high quality gaming content and we are especially proud of the outcome of this particular game because it exemplifies the P5’s true potential,” said David Devor, VP of Sales & Marketing at Essential Reality. “To mark the release of this new version, we will be conducting a number of joint promotions with Lionhead targeted at the 1.5 million Black & White users and the growing P5 community, including a Black & White tournament sponsored by Lionhead.”

“The collaboration between Lionhead and Essential Reality has provided us with a unique opportunity to work with an amazingly innovative technology company, " noted Peter Molyneux, manager director of Lionhead. "The P5 has some remarkable capabilities and we enjoyed being able to completely integrate these with Black and White."

About Black & White:

Black & White, published by Electronic Arts, sets players in the role of God, ruling over lands populated with villagers of potential worshippers. Players must first win the belief of villagers by impressing them with miracles and godly acts. Later, they will provide him with a personal pet; an emotional creature that has a life of its own, but wants more than anything to please its master. The player must rule as a benevolent or malevolent god. Whichever path he chooses affects his creature, his subjects and even the landscape of his kingdom. Black & White won major gaming awards, including Best Original Game and Best of Show at E3, the major trade show of the interactive game industry.

About Essential Reality:

Founded with the goal of becoming a leader in the design, development and integration of revolutionary tracking and sensory technologies Essential Reality aims to become a leading developer and distributor of unique, technology-based consumer electronics, including gaming and youth consumer products, with a focus on youths in the mass market. By leveraging our patented technologies and core competency in research and development, we believe we will be able to distinguish our products in the market by adding technological innovations to unique concepts at competitive, mass market price points.

About the P5:

With its initial product family - the P5 - Essential Reality focused on developing, manufacturing and distributing next-generation 3-D peripherals for the PC/Mac, console gaming and professional user communities. A USB based product, the first generation P5 is designed for compatibility with the Microsoft Windows 98 operating system and higher, as well as Mac OS 9 and below.

Certain of the above statements contained in this press release contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results, events and circumstances (including future performance, results and trends) could differ materially from those set forth in such statements due to various factors, risks and uncertainties, including but not limited to, risks associated with the Company’s future growth and operating results, the uncertainty of market acceptance of the Company’s products, technological change, competitive factors and general economic conditions. The Company has no duty and undertakes no obligation to update such statements.