American Technologies Group Seeks Acquisition Candidate and Plans Spin-Off of Subsidiary.

Business Editors

MONROVIA, Calif.--(BUSINESS WIRE)--July 26, 2001

American Technologies Group Inc. (ATG) (OTCBB:ATEG) today announced the intention to seek potential acquisition candidates that satisfy the business model selected by the company's management and board.

In that context, the company has concluded that ATG will primarily seek private companies to acquire as a wholly owned subsidiary. It is presently anticipated that such target companies would be in the high-technology or software industries.

The first step in order to effectuate such proposed acquisition, ATG will seek shareholder approval to increase its authorized capital stock. Such an increase will also allow ATG to seek additional financing which is necessary for the interim operation of the company.

In addition, ATG will seek shareholder approval to spin off its existing technology to its existing shareholders in a new public company thereby potentially increasing shareholder value for its existing shareholders.

It is anticipated that current ATG shareholders would benefit two-fold by owning shares in two publicly traded entities after these organic changes are effected upon their approval of management's recommendation.

Lawrence J. Brady, chairman and chief executive officer, said: "We have found a means by which we can dramatically improve value to the ATG investor by providing an ownership interest in a new acquisition target while retaining ownership of the basic ATG technologies which we have attempted to validate, test and market since I became ATG's CEO.

"In management's opinion, this is a win-win situation for everyone concerned. The definitive terms of any proposed transaction will be detailed in a communication to the shareholders."

The statements contained in this news release contain certain forward-looking statements, including statements regarding ATG's and its subsidiary's expectations, intentions, strategies and beliefs regarding the future. All statements contained herein are based upon information available to ATG's management as at the date hereof and actual results may vary based upon future events, both within and without the control of ATG's management.