Vancouver, BC, November 23, 2005--Contec Innovations announced the partial completion of its private placement offering, originally announced October 7, 2005, of 2,508,000 units at C$0.175 per Unit for gross proceeds of C$438,900. Such Units are subject to a four-month hold period expiring March 23, 2006.
Each Unit consisted of one common share and one half of a non-transferable share purchase warrant (the "Warrants") where each full Warrant will allow the subscriber to purchase an additional share at C$0.25 until the earlier of: (i) one year from issuance of the warrant; and (ii) the date which is the later of: (A) 30 days following the issuance of a press release by the Company confirming that the closing price of the common shares of the Company on the TSX Venture Exchange exceeded C$0.40 for 10 consecutive trading days and the aggregate number of common shares of the Company traded during that period was not less than 2,500,000 shares; and (B) four months and one day from the date of issuance of the warrant.
A finder's fee of C$62,244 cash and 195,400 finder's warrants, exercisable at C$0.175 per share for a period of one year, were paid in relation to this financing. Each Finder's Warrant may be exercised for one additional common share of the Company. Such warrants are also subject to a four-month hold period expiring March 23, 2006 and are subject to the same accelerated expiry conditions as the Warrants sold to subscribers.
It is expected that the completion of the remaining 2,492,000 units of this private placement will be closed within the coming weeks for proceeds of C$436,100 bringing the total amount raised to C$875,000 as announced October 7, 2005.
Contec to Offer An Additional 1,900,000 Units of Private Placement for Sale
Due to strong demand for the above-mentioned financing, Contec will undertake an additional non-brokered private placement offering to raise additional gross proceeds of up to C$332,500. Under the terms of this private placement, the Company will offer for sale a maximum of 1,900,000 Units (the "Units") at C$0.175 per Unit. This will bring the aggregate total of this and the above-mentioned financing, when completed, to C$1,207,500.
Each Unit will consist of one common share and one half of a non-transferable share purchase warrant (the "Warrants") where each full Warrant will allow the subscriber to purchase an additional share at C$0.25 until the earlier of: (i) one year from issuance of the warrant; and (ii) the date which is the later of: (A) 30 days following the issuance of a press release by the Company confirming that the closing price of the common shares of the Company on the TSX Venture Exchange exceeded C$0.40 for 10 consecutive trading days and the aggregate number of common shares of the Company traded during that period was not less than 2,500,000 shares; and (B) four months and one day from the date of issuance of the warrant.
The Company will pay a cash finder's fee equal to 8% of the total gross proceeds of the offering and finder's warrants ("Finder's Warrants") equal to 10% of the number of Units sold under the offering exercisable at C$0.175 per warrant for a period of one year from the closing. Each Finder's Warrant may be exercised for one additional common share of the Company. The Finder's Warrants are subject to the same accelerated expiry conditions as the Warrants sold to subscribers.
The Units issued upon the closing of the placement are subject to a 4-month hold period. The private placement is subject to the acceptance of the TSX Venture Exchange.
About Contec Innovations
Contec accelerates the growth of the mobile Internet by enabling mobile service providers to capitalize on new data services. Contec's core product, the Hornet(TM), is an open, carrier-class mobile services delivery platform capable of hosting multiple mobile applications in a secure, scalable environment allowing service providers to generate new revenues by efficiently deploying reliable and compelling data applications. Founded in 1999 and headquartered in Vancouver, Canada, Contec is listed on the TSX Venture Exchange under the symbol "BUZ".
The statement made in this press release may contain certain forward-looking statements that involve a number of risks and uncertainties. Actual events or results may differ from the Company's expectations. Hornet(TM) is a trademark of Contec Innovations Inc.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy of the content of the information contained herein.
Contact:
Brian Buckley
Contec Innovations Inc.
Investor Relations
(604) 468-5638 or 1-888-552-0360
brian.buckley@contec.ca
Asa Zanatta
Contec Innovations Inc.
Media Relations
(604) 408-1389
azanatta@spiritcommunications.ca
www.contec.ca