Bio-Plexus Emerges From Bankruptcy Protection With New Financing Plan.

Business Editors

VERNON, Conn.--(BUSINESS WIRE)--July 26, 2001

Bio-Plexus (OTCBB: BPLX):

Highlights

-- $19 Million of Debt Converted into Common Stock

-- $3 Million Private Placement Completed

-- $2.5 Million in Annual Interest Expense Eliminated

-- 1 for 10 Reverse Stock Split Implemented

-- Launches PUNCTUR-GUARD(R) Safety Winged Set for Blood Collection

-- Company Files Form 10-K and Form 10-Q with SEC

Bio-Plexus, Inc. (Pink Sheets: BPLX), a leader in the design, manufacture and marketing of safety medical needles and related products, today announced that it has successfully emerged from protection under Chapter 11 of the United States Bankruptcy Code.

The Company has also implemented a recapitalization and refinancing plan with Appaloosa Management LP and certain related entities ("Appaloosa"), which has resulted in, among other things: a.) the elimination of the convertible debt held by Appaloosa; b) the elimination of $2.5 million in annual interest expense; c) the elimination of current restrictive covenants; d) the increase in shareholders' equity from negative $3 million to positive $19 million, a $22 million turnaround; and e) a $3 million capital infusion to Bio-Plexus. In connection with the restructuring, Bio-Plexus has also implemented a new equity incentive plan aimed at retaining key employees.

John S. Metz, President and Chief Executive Officer of Bio-Plexus, stated, "In sum, the developments announced today have positioned Bio-Plexus for future growth in the medical safety needle industry and provided financial stability for the Company."

The plan includes the following key components:

-- Conversion of Appaloosa Debt to Equity

Appaloosa has converted its existing debt of approximately $19

million into approximately 8.5 million shares of Bio-Plexus

common stock.

-- New Equity Investment of $3 million

The Company also completed a $3 million private placement with

Appaloosa through the issuance of 1.3 million shares of common

stock. As a result of its debt conversion and equity infusion,

Appaloosa now owns approximately 87% of the issued and

outstanding shares of Bio-Plexus common stock. In addition,

Bio-Plexus has granted callable Warrants to Appaloosa to

purchase an additional 1,314,060 shares of common stock,

exercisable at $2.283 per share. Upon achieving certain

performance targets, Bio-Plexus will be able to call for the

redemption of these warrants at $0.01. The Company believes

this will provide an incentive for Appaloosa to exercise early

and infuse an additional $3 million of capital into the

Company. Proceeds from the private placement and, if

exercised, the Warrants, will be used for general corporate

purposes.

With the balance sheet restructured and the infusion of new equity capital, the Company is seeking to raise up to $4 million in additional funds through traditional debt financing, lease financing or similar transactions, to provide new working capital as needed.

-- Reincorporation and Reverse Split

The Company, formerly a Connecticut Corporation, has been

reincorporated as a Delaware corporation, effective July 9,

2001. As part of the reincorporation, holders of Bio-Plexus

Common Stock shall receive 1 (one) share of Common Stock in

the Delaware Bio-Plexus in exchange for 10 (ten) shares of

Common Stock in the Connecticut Bio-Plexus. The total number

of common shares (diluted) outstanding (post reverse split)

stands at 11.3 million.

Mr. Metz continued, "Clearly, this has been a difficult time for Bio-Plexus. While I am pleased to announce today's developments, I am most proud of the fact that throughout the bankruptcy period we have successfully met the needs of our customers and our vendors. This is due in large part to the hard work and dedication of our employees, who, in my opinion, are among the best and brightest in our industry. Bio-Plexus has established itself as a world-class provider of a comprehensive range of medical safety needles and related products. We believe that this new financing plan will allow us to focus our efforts on accelerating the growth of the Company and expanding our industry presence."

The Company also announced that on July 17, 2001, it filed its Form 10-K (for the year ending December 31, 2000) and Form 10-Q (for the period ending March 31, 2001) with the Securities and Exchange Commission. The Company's delinquency in filing these reports, due to the bankruptcy proceedings and recapitalization, caused the Company's common stock to be delisted from the OTC Bulletin Board. Bio-Plexus is taking the necessary additional steps to re-list its common stock on the OTC Bulletin Board. The Company believes this will allow its stock to begin trading in an orderly market and allow investors easier access to Company news and information. Bio-Plexus also plans to apply for a listing on a national stock exchange once it meets all necessary eligibility requirements.

The Company also announced that it has begun fulfilling customer orders for its PUNCTUR-GUARD(R) Safety Winged Set for Blood Collection. This commercialization follows the Company's receipt of 510(k) approval from the Food and Drug Administration in January 2001 and the successful clinical evaluations of the product undertaken by Bio-Plexus since May 2001.

Mr. Metz concluded, "We are proud that our products have a direct impact on the safety and well-being of healthcare workers around the world. As evidenced by the recent launch of our new Winged Set, we are continuing to leverage our PUNCTUR-GUARD(R)technology to develop new, innovative products. These advances complement existing agreements in place with companies such as Johnson & Johnson (NYSE: JNJ), Fresenius Medical Care, North America (NYSE: FMS) and Teleflex Medical, which supplies C.R. Bard (NYSE: BCR)."

Bio-Plexus, Inc. (OTCBB: BPLX), designs, develops, manufactures and holds U.S. and international patents on safety medical needles and other products under the PUNCTUR-GUARD(R), DROP-IT(R), and PUNCTUR-GUARD REVOLUTION(TM) brand names. For independent evaluations of the PUNCTUR-GUARD(R) blood collection needle, refer to the Centers for Disease Control (MMWR, January 1997) and ECRI (Health Devices, June 1998 and October 1999) studies. Accidental needlesticks are estimated to number about one million per year in the United States and can result in the transmission of deadly diseases including HIV and Hepatitis B and C.

NOTE: THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. FORWARD-LOOKING STATEMENTS ARE IDENTIFIED BY THE USE OF SUCH TERMINOLOGY AS "BELIEVES," "EXPECTS," "MAY," "WILL," "SHOULD," "ANTICIPATES," "PLANS," "ESTIMATES," AND "INTENDS" OR DERIVATIONS OR NEGATIVES THEREOF OR COMPARABLE TERMINOLOGY. ACCORDINGLY, SUCH STATEMENTS INVOLVE RISKS (KNOWN AND UNKNOWN) AND UNCERTAINTIES. THESE RISKS AND UNCERTAINTIES INCLUDE THE CONTINUED WILLINGNESS OF THE COMPANY'S CUSTOMERS, VENDORS AND EMPLOYEES TO MAINTAIN THEIR RELATIONSHIPS WITH THE COMPANY DURING THIS PERIOD; THE ACCEPTANCE OF THE COMPANY'S PRODUCTS BY HEALTH CARE PROFESSIONALS; THE COMPANY'S ABILITY TO PROTECT ITS PROPRIETY TECHNOLOGY; AVAILABILITY OF QUALIFIED PERSONNEL; CHANGES IN, OR FAILURE TO COMPLY WITH GOVERNMENT REGULATIONS; THE RISKS ASSOCIATED WITH EXPANDING THE COMPANY'S BUSINESS INTERNATIONALLY; THE ABILITY OF THE COMPANY TO MEET CERTAIN PERFORMANCE OBJECTIVES AND REQUIREMENTS RELATED TO THE PUBLIC TRADING OF ITS STOCK; THE ABILITY OF THE COMPANY TO OBTAIN ADDITIONAL FINANCING; GENERAL ECONOMIC AND BUSINESS CONDITIONS; AND OTHER RISK FACTORS AND UNCERTAINTIES DETAILED IN THIS REPORT, DESCRIBED FROM TIME TO TIME IN THE COMPANY'S OTHER SECURITIES AND EXCHANGE COMMISSION FILINGS, OR DISCUSSED IN THE COMPANY'S PRESS RELEASES. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE OR ADVISE UPON ANY SUCH FORWARD-LOOKING STATEMENT.