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NOGALES, ARIZONA - June 14, 2005 -- Alpha Pro Tech
(AMEX: APT; CHX:APT), is a leading developer and manufacturer of
proprietary materials for disposable protective apparel and consumer products.
Alpha ProTech Engineered Products, Inc. has announced today that it has signed
a joint venture with a manufacturer in India for the production of building
products. This joint venture positions Alpha ProTech Engineered Products to
respond to current and expected increased product demand for synthetic roofing
underlayment, and future capacity for sales of specialty roofing component
products and custom products for industrial applications requiring high quality
extrusion coated fabrics.
Under terms of the joint venture agreement, a private company, Harmony Plastics
Private Limited (Harmony), will be owned on a 50/50 basis by Alpha ProTech
Engineered Products, Inc. and Maple Industries and Associates the India
shareholders. Alpha ProTech Engineered Products, Inc. and Maple Industries and
Associates will each contribute $350,000 for startup capital, and Alpha ProTech
Engineered Products, Inc. will make a long term advance of $1 million for
materials. This advance is non interest bearing and $500,000 is to be repaid
monthly over a six year term and the balance of $500,000 is to be paid in the
seventh year .The India shareholders will arrange a bank loan of $1.65 million,
guaranteed exclusively by the India shareholders and the assets of Harmony
Plastics Private Limited. As a result, the total initial funding will be $3.35
million, of which Alpha ProTech Engineered Products, Inc. will contribute
approximately $1.35 million.
This capital will be utilized to purchase an existing 33,000 square-foot
manufacturing facility in India; this facility includes manufacturing equipment
necessary to produce roof underlayment. Harmony will also build a new 60,000
square-foot facility for the additional manufacturing of roof underlayment and
other building products.
Al Millar, Alpha ProTech’s President, commented, “this agreement will allow us
to significantly increase our manufacturing capacity with an expenditure of
only $1.35 million. We are also expanding our manufacturing facility in
Valdosta, Georgia to 50,000 square feet to meet future demands for our building
products. Between our Valdosta plant, and this joint venture in India, we have
taken necessary steps to cover current and expected future needs. We will,
because of this joint venture, enjoy competitive pricing, enabling us to
improve our margins for these products over time. We have already seen good
response for our building products.”
Harmony will be managed by four directors on the Company’s board, including
Sheldon Hoffman (Alpha ProTech’s Chief Executive Officer) and Lloyd Hoffman
(Alpha ProTech’s Chief Financial Officer), and two directors appointed by the
India shareholders.
Alpha ProTech Engineered Products, Inc. has signed mutually exclusive agreements
with Perma "R" Products, Inc., a Grenada, Mississippi based company in the
construction industry, for the distribution of Alpha Pro Tech's roof
underlayment and house wrap products.
“The market acceptance of our products, coupled with our ability to secure a
distributor with the resources and reputation of Perma “R” Products, has
reinforced our growing confidence in this exciting product line” Mr. Millar
continued. “We are taking the next step with this joint venture, and believe
this will set the stage for continued growth and improved margins.”
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