Preo Software Inc.
TSX VENTURE : PKM

Preo Software Inc.

April 18, 2012 16:10 ET

Preo Software Inc. Announces Completion of $250,000 Financing

CALGARY, ALBERTA--(Marketwire - April 18, 2012) -

NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA

PREO SOFTWARE INC. (the "Corporation") (TSX VENTURE:PKM). The Corporation is pleased to announce that it has completed the previously announced private placement of Units for gross aggregate proceeds of $250,000. Preo issued Units consisting of $250,000 principal amount of 15% secured, subordinated convertible debenture ("Debentures") and 250,000 share purchase warrants ("Warrants") of the Corporation. The Debentures are for a term of two (2) years and the interest thereunder will be payable by the issuance of common shares ("Common Shares") of the Corporation at an issuance price of $0.15 for the first quarter and thereafter at an issuance price based on the market price of the Common Shares. The holders of the Debentures have the right to convert the outstanding principal into Common Shares at $0.15 at any time prior to maturity. In the event that the volume weighted average trading price of a minimum of 10,000 Common Share is not less than $0.25 for a period of 30 consecutive trading days, the Debentures will automatically convert into Common Shares at $0.15. The Debentures are secured by a general security agreement against all present and after-acquired property of the Corporation. Each Warrant entitles the holders of the Debentures with the right to purchase one (1) Common Share at an exercise price of $0.15 for a period of twenty-four (24) months.

In connection with the private placement, HOME Investment Management Inc., an Exempt Market Dealer and Portfolio Manager, was paid a cash commission of $20,000 and was also issued 50,000 agent's warrants (the "Agent's Warrants"), with the terms of the Agent's Warrants being identical to the Warrants.

The Debentures, Warrants and Agent's Warrants, as well as the Common Shares issuable thereunder are all subject to a four (4) month hold period in accordance with applicable securities laws.

The net proceeds of the private placement will be used by the Corporation for general working capital purposes.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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