Ceramic Protection Corporation Completes Issuance of Debenture



    Symbol: CEP
    Exchange: TSX

    SUNRISE, FL, Oct. 3 /CNW/ - Ceramic Protection Corporation ("CPC" or the
"Corporation"), a leading manufacturer and distributor of advanced ballistic
protective products, today announced that it successfully completed the
placement of a non-convertible secured debenture on September 28, 2007 in the
amount of US $1.7 million. The debenture was placed with affiliates of
Fairholme Capital Management, L.L.C. who are significant shareholders of the
Corporation. This brings the total amount of the debentures issued to US
$5.1 million.

    Debenture

    Mr. Steve Giordanella, CEO, announced today that the Corporation has
successfully placed an additional non-convertible secured debenture in the
amount of US $1.7 million similar in terms with the recent US $3.4 million
debenture placement announced August 30, 2007. "I am very pleased to announce
that the Corporation has placed an additional US $1.7 million debenture with a
significant shareholder of the Corporation. The funds will be used for general
working capital purposes and to further the Corporation's focused strategy to
secure continuing opportunities for growth."
    The debenture carries an interest rate of 12% for a two year term with no
prepayment penalty. In addition, for each US $10 of face value of the
non-convertible debenture, the holder will be granted one share purchase
warrant with an exercise price of CAD $7.50 and an expiry date two years from
date of issuance. Issuance of the warrants is subject to TSX Exchange
approval.

    Business of the Corporation

    Ceramic Protection Corporation, headquartered in Sunrise, Florida, USA,
with offices in Newark, Delaware, USA, is a certified manufacturer and
distributor of advanced materials for use in the ballistic protection
marketplace. The Corporation manufactures a wide range of products used to
provide protection for personnel and vehicles, including a wide range of
ceramic armour products and multiple composite-based products. In conjunction
with its wholly owned subsidiary Ceramic Protection Corporation of America of
Newark, Delaware, the Corporation also manufactures a wide range of boron
carbide, silicon carbide and polyethylene products for use in personnel armour
systems. PPI of Sunrise, Florida, manufactures a growing range of soft armour
products for the law enforcement and military markets.

    Forward Looking Statements

    This release may contain forward looking statements including
expectations of future sales, cash flow, and earnings. These statements are
based on current expectations that involve a number of risks and uncertainties
that could cause actual results to differ from those anticipated. These risks
include, but are not limited to, uncertainties associated with the defense
industry, commodity prices, exchange rate fluctuations, and risks resulting
from potential delays, appeals or changes related to government orders in the
defense sector.
    The Corporation depends on reliable supplies of high quality source
materials used in the manufacture of armour products, including aramid fabrics
and polyethylene materials, and works actively with key suppliers to ensure
that requirements and demands for these materials are anticipated and properly
met. The foregoing is not exhaustive and other risks are detailed from time to
time in other disclosure filings of the Corporation. Should one or more of
these risks or uncertainties materialize, or should stated assumptions
underlying the forward looking statements prove incorrect, actual results may
vary materially from those described herein as anticipated, believed,
estimated or expected. The reader is also referred to other uncertainties and
risks discussed in detail in the MD&A section of the Corporation's December
31, 2006 Annual Report dated March 20, 2007 and also the Corporation's Annual
Information Form.
    In light of certain sensitive aspects in regard to customers and
products, the Corporation may choose not to disclose all information related
to the purchasers of its products, such as government agencies, countries or
other end-users. Armour products destined for export which are manufactured in
Canada must first be approved by the Canadian Department of Foreign Affairs
and International Trade. Products manufactured for export in the United States
must first be approved for export by the appropriate U.S. government agencies.
Other armour sales may be made to recognized domestic agencies such as the
military and those involved in local, provincial, or national law enforcement
and homeland security matters.

    Investor Relations

    Analyst and investor relations calls should be addressed to Ms. Grimie
Villarreal, Corporate Investor Relations, at (954) 846-8222. Interested
parties are also referred to the Corporation's website www.cerpro.com for
further information about the Corporation, its products and other recent
announcements.

    
    Mr. Steve Giordanella                Mr. Larry Moeller
    Chief Executive Officer              Chairman
    

    %SEDAR: 00001737E




For further information:

For further information: Ms. Grimie Villarreal, Corporate Investor
Relations, at (954) 846-8222

Organization Profile

CERAMIC PROTECTION CORPORATION

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