ELAST Technologies Receives Buy Recommendation by Xcel Associates.

Business Editors

LAS VEGAS--(BUSINESS WIRE)--May 12, 2000

ELAST Technologies, Inc., (OTC-BB:ESTG) www.elast.com announced the release of a comprehensive investment report prepared by Xcel Associates which "strongly recommend(s) purchase of ESTG ... for its large, long-term capital appreciation potential, in aggressive, risk/tolerant accounts".

Xcel's investment opinion is based on a thorough analysis of ELAST Technologies, including the Company, its management, product, market and finances, as well as the impact of its potential merger with the privately held Bioelectronics Corporation.

The following summary of the full report was also prepared by Xcel Associates. View the complete report at www.elast.com or www.xcelassociates.com.

The Present Company: Elast Technologies, Inc.

Elast Technologies, Inc. (OTC: BB symbol "ESTG") is a technology-development company in the medical equipment field, based in Las Vegas, NV. Its Electronic Allergo-Sensitivity Test (ELAST) Device(TM) is an allergy-sensitivity testing instrument whose technology is based on the flow of electricity in the human body. The Company holds a patent on its invention, which could have a brilliant medical/economic future, especially if it receives FDA approval, because of the huge number of allergy-sensitive humans worldwide. A fully S.E.C.-reporting company, it was incorporated in NV in 1996 as a result of a reverse acquisition (with a public company) in October 1998, at which time ESTG shares began trading publicly. Robert D. Milne, M.D., the Inventor of the ELAST Device(TM) and the Founder of the Company, is recognized in the integrative medicine/allergy field. He practices family/integrative medicine, out of which came insights which led to his creation of the ELAST Device(TM). There are currently 9.3 million common shares outstanding, of which 4.0 million shares are in the float. The Founder and President together own 30% and there is an apparent constituency of shareholders with an unusual faith in the Company's outlook (many are Dr. Milne's patients). The 52-week price range of ESTG is $3.125-$0.75. Trading volume averaged about 14,000 shares per day from October 1998-February 2000, but has been 50,000 shares over the past 90 days. The two-day combined total of almost 1,000,000 shares traded in mid-March was extraordinary. We attribute this volume surge to growing investor awareness of ESTG's potential, spurred by the Company's activities at the time to raise capital. It obtained $1 million which should cover final product development, clinical trials, and FDA filing next year.

The Proposed Company: Elast Bioelectronics Corporation

Elast Technologies, Inc. has entered into a merger agreement with Bioelectronics Corporation ("Bioelectronics") of Germantown, MD, a private company. Bioelectronics is a technology-development firm also engaged in the bioelectric medical equipment field. It has also developed one product - the Portic Electronic Bandage ("Portic"). The Portic has successfully demonstrated, on over 2,000 patients, the capability to reduce the healing time of tissue injuries (hard and soft) by 20% - 30%, without any side effects. Bioelectronics is seeking FDA approval of the Portic.

The terms of the merger agreement call for a share-for-share exchange, after which there would be 18.6 million shares outstanding. Voting by shareholders is scheduled for early June. We are assuming that the proposed merger will be approved because of the strong desire of controlling shareholders of both companies to quickly consummate a friendly union. The surviving public company will be renamed Elast Bioelectronics Corporation ("Elast Bioelectronics"). Dr. Robert Milne, currently Chairman of Elast Technologies, and Thomas Krucker, currently President/CEO of Elast Technologies, will both assume the same titles and functions with the newly formed entity. Mr. Andrew J. Whelan, currently Chairman/President of Bioelectronics Corp., will become Chief Operating Officer of Elast Bioelectronics Corp. The Board of Directors of the combined company will consist of representation of current Elast and Bioelectronics' directors, with a majority coming from Elast's Board.

Investment Opinion

We strongly recommend purchase of ESTG (with its imminent transformation into Elast Bioelectronics Corp.) for its large, long-term capital appreciation potential, in aggressive/risk-tolerant accounts, for several reasons.

1. The potential markets are huge for each of the two bioelectric

products. The ELAST Device(TM) detects allergy-sensitivity

conditions, which millions suffer from, and which we estimate

to be a $6 billion annual market in the U.S. (and $12 billion

worldwide). The Portic Electronic Bandage (and planned

companion products) promotes faster healing of tissue

injuries. We estimate there are 100 million tissue injuries

annually in the U.S. and that the Portic could be

therapeutically applied to some 40 million wounds. This

implies a potential $5 billion annual market in the U.S. (and

$10 billion worldwide).

2. The ELAST Device(TM) and the Portic both offer promising

technologies, which would dramatically improve the medical

state-of-art. We believe both products have attractive odds of

achieving proprietary positions in their market niches, based

on their patents, superior features, and presumed commercial

lead time.

3. The Company's senior management trio has impressive and

complementary skills, in our opinion. Dr. Robert Milne,

Chairman, is the inventor of the ELAST Device(TM); Thomas

Krucker, President, has a strong record of business successes

as a manager and entrepreneur; and Andrew J. Whelan, the new

COO, has outstanding credentials in financial management and

health care entrepreneurship.

4. Very rapid revenue/EPS growth is projected by us. On a

pro-forma, post-merger basis, we estimate that revenues will

soar from about $4 million in 2001 to over $190 million in

2005 and that EPS will escalate from break-even in 2001 to

about $2.25 in 2005.

5. A premium market P/E Ratio is likely, given the projected

growth rates and product leadership.

6. The equity capitalization is small, so increasing investor

awareness and positive future events could propel the stock

price.

7. Long-run buy-out potential should develop, assuming our future

expectations are met.

The caveats for this still development-stage company are its needs: to raise capital to fund full ramp-up; to obtain FDA approval for both products; and to successfully commence production and marketing of the products. Also, as a Bulletin Board stock, above-average volatility is likely.

But on its prospects, we believe ESTG is substantially undervalued at $1.375 per share - only a $13 million market cap valuation for a "two-way" play on the exciting technology of bioelectric medicine and its vast potential markets.

This news release contains forward-looking statements. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product development and consumer demand and acceptance, changes in technology, ability to raise capital, the availability of appropriate acquisition candidates and/or business partnerships, economic conditions, impact of competition and pricing, capacity and supply constraints or difficulties, government regulation and other risks. All such forward-looking statements whether written or oral, and whether made by or on behalf of the Company are expressly qualified by these cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.