Pen Interconnect Signs $10 Million Manufacturing Agreement With ImagingTechnologies Corporation
Relationship Represents the Largest Agreement in the History of the Company
Pen Interconnect Has Announced $15 Million in New Outsource Agreements Over
The Past Month
IRVINE, Calif., March 23 /PRNewswire/ -- Pen Interconnect, Inc.
(Nasdaq: PENC) announced today that its wholly-owned subsidiary, InCirT
Technology, has signed an annual manufacturing and outsource agreement with
Imaging Technologies Corporation (Nasdaq: ITEC), a pioneer in the development
of digital imaging solutions based in San Diego, California. The relationship
is one whereby Pen will assume all of the manufacturing and fulfillment
services for ITEC. This agreement contemplates $10 million in annual revenues
to PEN and work under the relationship is scheduled to begin immediately.
Under the terms of the contract, PEN will provide a complete turnkey out
source manufacturing services and logistics support program for Imaging
Technologies' color printer controller boards and printer systems. This will
allow for ITEC to maintain high volume manufacturing, test, packing and
shipping capabilities thereby expanding their business without the cost of
setting up their own manufacturing facility.
This agreement brings the total amount of new outsource agreements
announced by PEN in the month of March to more than $15 million. PEN recently
announced a $4 million contract award for circuit board assembly and yesterday
announced new contracts totaling more than $1 million for the design and
manufacturing of proprietary power products at its PowerStream division.
Commenting on the announcement, Steve Fryer, CEO of Pen Interconnect,
stated, "This relationship is the largest outsource agreement in the history
of PEN and is a milestone for our InCirT Technology manufacturing division.
The ITEC agreement will enable InCirT Technology to significantly increase its
capacity utilization at its newly expanded facility in Irvine, and
consequently, move PEN into a much stronger cashflow position as we move back
toward profitability. Our recent success is a result of our previously
announced intent to emphasize our core divisions after selling our
unprofitable non-core operations. Additionally, industry trends continue to be
very favorable for outcource contract manufacturing. PEN currently has in
excess of $30 million in outstanding bids and expects to be able to announce
more contract activity in the near future. These recent agreements increase
our current annual revenue run-rate to more than $26 million."
"The resources of Pen Interconnect will allow ITEC to promptly fulfill a
backlog of orders for our newest generation of printers and digital imaging
products," said Brian Bonar, Chief Executive Officer of Imaging Technologies.
"Pen Interconnect provides us with a wealth of both technical and
manufacturing capabilities. Partnering with them allows us to expand our
product mix, focusing our efforts on technology, without having to deal with
day to day manufacturing or fulfillment issues. Our goal is to solidify our
position in the industry by concentrating on our areas of greatest strength."
About Pen Interconnect
Pen Interconnect, Inc. provides the total manufacturing solution including
circuit design, board design from schematic, mechanical and product design,
prototype assembly, volume board assembly, system services and end-user
distribution. Pen Interconnect, Inc. has support manufacturing facilities in
California, Utah and China. For information on the Company's product data,
visit their web site at pen-interconnect.com.
About Imaging Technologies Corporation
Imaging Technologies Corporation is a worldwide pioneer in the
development, manufacturing, licensing, and distribution of high-quality
digital imaging solutions. Founded in 1982 and headquartered in San Diego,
California, the Company produces imaging products for a diverse range of
market segments. Beginning with a core technology in the design and
development of Adobe(R) PostScript(R) controllers for non-impact printers and
multifunction peripherals, the Company has expanded its product offerings to
include monochrome and color printers, and software to improve the accuracy of
color reproduction.
NOTE: The statements contained in this news release that are not purely
historical are forward-looking statements that may involve risks and
uncertainties. The Company's actual results may differ significantly from the
results contained in the forward-looking statements. Factors that might cause
such differences include, but are not limited to, the effect of losses and
other factors on the Company's credit facilities, business and results of
operations; the Company's limited capital resources and its ability to fulfill
its existing obligations and ongoing capital needs; risks associated with
excess or obsolete inventory; the potential impairment of assets; the
Company's dependence on key customers and their financial viability; the
impact of competition; and the Company's abilities to effectively manage
growth. These and other risk factors are discussed in the Company's filing on
Forms 8-K, S-3, 10-QSB and 10-KSB.
CONTACT: Stephen Fryer, CEO of Pen Interconnect, Inc., 949-798-5800; or
Richard Carpenter or Jeff Lamberson of American Financial Communication,
916-552-6532.
SOURCE Pen Interconnect, Inc.
CO: Pen Interconnect, Inc.; InCirT Technology; Imaging Technologies
Corporation
ST: California, Utah
IN: CPR
SU: CON
03/23/99 06:00 EST prnewswire.com
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