Paragon Pharmacies Limited
TSX VENTURE : PGN

Paragon Pharmacies Limited

December 15, 2006 12:38 ET

Paragon Pharmacies Limited Announces Private Placement for Up to $10 Million

KELOWNA, BRITISH COLUMBIA--(CCNMatthews - Dec. 15, 2006) -

THIS NEWS RELEASE DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES IN THE UNITED STATES. THE SECURITIES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES ACT") OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO U.S. PERSONS UNLESS REGISTERED UNDER THE U.S. SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

Paragon Pharmacies Limited (TSX VENTURE:PGN) ("Paragon" or the "Corporation") announced today that it intends to raise up to $10,000,000 through a private placement of units of the Corporation ("Units") at a price of $0.80 per Unit. Each Unit is comprised of one common share and one common share purchase warrant ("Warrants"). Each Warrant shall entitle the holder to acquire one common share of the Corporation for a period of 36 months from the closing date at an exercise price of $1.00 per common share. Closing of the private placement is subject to necessary regulatory approval and is expected to occur on or about December 28, 2006. Versant Partners Inc. is acting as lead agent in respect of the financing.

Paragon intends to use the net proceeds from the offering for acquisitions, capital expenditures, and for general corporate purposes.

Paragon is headquartered in Kelowna, British Columbia and currently employs over 355 full and part time staff in its stores and offices. The Corporation currently owns and operates 17.5 retail pharmacies and 2 home healthcare stores in British Columbia and Alberta. Paragon also holds a minority ownership position in Catalyst Healthcare Ltd.

The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

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