Neotel International Inc.
TSX VENTURE : NIT

Neotel International Inc.

May 17, 2006 12:27 ET

Neotel Closes Financing

MARKHAM, ONTARIO--(CCNMatthews - May 17, 2006) - Neotel International Inc. ("Neotel")(TSX VENTURE:NIT) announced today that it has completed a non-brokered offering of 2,513,888 units (each a "Unit" and collectively the "Units") at a price of $0.225 per unit to raise gross proceeds of $565,625. Each Unit consists of one common share and one-half of a common share purchase warrant ("Warrant"). Each whole Warrant entitles the holder to acquire one additional common share at a price of $0.30 for a period of two years from closing.

In connection with the non-brokered placement of Units, the Company paid the following commissions: to CIBC Wood Gundy $15,750 and 70,000 compensation options; to Octagon Capital Corp. $13,750 and 61,111 compensation options; to Northern Securities Limited $5,175 and 23,000 compensation options; to Hampton Securities Limited $10,125 and 45,000 compensation options; to Canaccord Capital Corporation $5,575 and 24,777 compensation options and to 176724 Canada Ltd. $6,187. Each compensation option entitles the holder to acquire one Unit at $0.225 for a two year period. Each Unit consists of one common share and one-half of a common share purchase warrant. Each whole Warrant is exercisable into one common share at $0.30 for a two year period.

All securities issued in connection with the private placement are subject to resale restrictions until September 6, 2006.

The proceeds of the private placement will be used for working capital purposes.

ABOUT NEOTEL INTERNATIONAL INC.

Neotel International Inc. is a provider of identity, security, and trust solutions as well as professional services specializing in industry based biometric identification solutions. Additional information about Neotel is available at www.neotel.ca.

16,221,534 shares outstanding.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Neotel International Inc.
    Howard Phee
    President
    (905) 948 9229 ext: 22