Allied Devices is Denied Use of Cash Collateral

    HICKSVILLE, N.Y.--March 18, 2003--Following the filing for protection from creditors under Chapter 11 of the Bankruptcy Code on February 19, 2003, Allied Devices Corporation (ALDVE.OB) (the "Company") received an emergency approval for the use of cash collateral until a hearing on February 27, 2003.
    On February 27th, the Company was denied the use of cash collateral.
    Since then, the Court has approved a consent stipulation between the Company and its secured lenders to permit the Company to operate as a going concern while it seeks a sale of the Company in part or in whole. On March 13, 2003, the bankruptcy court approved the sale of certain assets of its APPI, Inc. subsidiary in Sanford, Maine. The Company has also been in discussions with potential buyers for the assets of its Allied Devices operations in Hicksville, NY.
    If the Company is unsuccessful in finding a buyer or buyers, it may be required to cease operations and complete an orderly wind down. All proceeds from the sale of assets will be distributed to the creditors of the Company. If the assets sold are insufficient to satisfy creditor claims, common stockholders of the Company will not receive any payments.

    All statements contained herein that are not historical facts, including but not limited to statements regarding the Company's current business strategy and the Company's plans for future development, operations and capital raising, are based upon current expectations. For factors, which could affect the realization of those expectations, see the Company's current annual report on Form 10-K.