Contec Innovations Inc.
TSX VENTURE : BUZ

Contec Innovations Inc.

August 02, 2005 09:15 ET

Contec Innovations Inc.: Chinese Arm of Major Telecom Infrastructure Company to Evaluate Marketing Hornet™; Richard Zhang Appointed as Advisor

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 2, 2005) - Contec Innovations (TSX VENTURE:BUZ), a provider of mobile Internet infrastructure software, has signed a Memorandum of Understanding with the China unit of a major telecom infrastructure company ("China Unit") to evaluate the potential for the China Unit to market Hornet, Contec's Mobile Services Delivery Platform solution, within China.

Contec and the China Unit have formed a joint working committee to consider the opportunities and commitment required for marketing collaboration - this may include Hornet platform trials with the China Unit's customers. There are no assurances that discussions with the China Unit, or parent company, will lead to any definitive agreements; the Memo of Understanding remains in effect until June 27, 2006, unless extended by mutual agreement.

"It is important for Contec to align ourselves with key mobile infrastructure partners," stated Don Lay, Contec's CEO. "The anticipated licensing and subsequent deployment of 3G networks in China represents an ideal opportunity to exploit our product's strengths in this exciting marketplace."

Richard Zhang has been appointed to Contec's Advisory Committee. Based in Beijing, Mr. Zhang has played a significant role in the Chinese telecom sector and has key relationships with device manufacturers, mobile network operators and other service providers in China. Mr. Zhang is currently the President of CEC Mobile ("CECM"), a unit of CEC Group, which designs, assembles and markets mobile handsets for customers that include China's second largest mobile operator, China Unicom.

Prior to joining CECM, Mr. Zhang was the assistant general manager of China Electronics Corporation and was responsible for the telecommunication business within the CEC Group. Before joining CEC in 1999, Mr. Zhang was deputy general manager of Golden Cellular Communication Co., Ltd where he was responsible for developing the digital CDMA Wireless Local Loop system. Mr. Zhang's graduate degrees include a M.Sc. from the Research Institute of Automation, China Academy of Science and an Executive MBA Degree from Beijing University.

Employing approximately 34,000 people, state-owned CEC Group is an electronics, information and industrial conglomerate spanning China with assets totaling approximately US$4 billion. For more information about CEC, please visit www.cec.com.cn/cecchannel/english.

In relation to the above appointment, Contec has granted incentive stock options to purchase up to 50,000 common shares at an exercise price of C$0.16 for up to five years. The grant of these stock options is subject to TSX Venture Exchange approval.

ON BEHALF OF THE BOARD OF DIRECTORS OF CONTEC INNOVATIONS

Don Lay, CEO

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™, 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". For more information, visit www.contec.ca.

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™ 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.

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