Phelps Engineered Plastics Acquires Alpha Machines Technologies, Ltd.

15 June 1999

Phelps Engineered Plastics Acquires Alpha Machines Technologies, Ltd.

    DANBURY, Conn.--June 14, 1999--Phelps Engineered Plastics (OTCBB: PEPC) announced today the acquisition of the assets of Alpha Machine Technologies Ltd. (AMT). The terms were not disclosed. AMT, located in East Kilbride, Scotland, specializes in the design, engineering, production, installation and maintenance of automated manufacturing and test systems. The acquired assets will be operated by a UK subsidiary of PEPC's U.S. operating subsidiary.
    Ed Phelps, CEO of PEPC, stated, "This is an exciting development in the expansion of our activities in Europe. The purchase of AMT will provide support for existing licensing agreements with major Italian and Austrian companies. Additionally, the combination of our production/marketing skills with the engineering, design and materials knowledge of AMT is a big leap forward in the implementation of our global business plan."
    Mr. David McDonald, Chief Executive of AMT, commented, "AMT has considerable resources and expertise in new materials technology which complements PEPC's proprietary composite material technology. I have worked with Ed Phelps before to design the original PepCore(TM) technology and look forward to finalizing the development of a new generation of cost-effective, high-output PepCore(TM) machine. Our proven record of creative design, engineering and production of advanced machines will be a big asset to PEPC's continued growth."
    PEPC is encouraged by the support and assistance indicated from the Scottish Development Agencies ("Locate in Scotland"). They consider the intellectual resources of AMT, when combined with the technical expertise of PEPC, to be a major asset in a significant growth area.
    The new subsidiary will operate from a 12,000 sq. ft. modern leasehold facility in a prestige science park location in East Kilbride, Scotland. It has a high-quality machine shop and good metrology capability and utilizes CAD throughout. The company has full ISO 9001 accreditation, which is independent verification of its cutting-edge standards and exceptional quality.
    The high levels of concept engineering, mechanical design engineering, software engineering, control hardware engineering and prototype build capability have allowed AMT to manufacture and assemble complex installations in house. There is a blue-chip client base and a track record of performace. The most recent projects include automated packaging systems, small component camera drive assembly machines, fully automated test machines for the steel and aluminum industries, manufacturing systems for automotive components and electronic components, as well as developmental projects in ceramics, metal matrix composites and other technology developments.
    Separately, PEPC announced the earlier completion of its corporate name change to Phelps Engineered Plastics Corporation (from Capital Assurance Corporation) and the change of its ticker symbol to PEPC.

    Statements contained in this press release regarding future financial and operating performance and results, marketing plans amd initiatives, operational intitiatives, technology, and other statements that are not historical facts are forward-looking statements within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Past performance is not necessarily indicative of future results, and actual results could differ significantly from any results anticipated in any forward-looking statement. The forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks associated with: factors affecting internal growth and management of growth, the availability of adequate financing, the Company's ability to implement its strategic technology, marketing and operational initiatives, dependence on technology, the building products and engineered products market, seasonality, quarterly fluctuations and general economic conditions and other factors.