Shift Networks Inc.

Shift Networks Inc.

October 25, 2006 11:15 ET

Shift Networks Announces $10 Million Financing and Share Consolidation

CALGARY, ALBERTA--(CCNMatthews - Oct. 25, 2006) -


Shift Networks Inc. ("Shift") (TSX VENTURE:SHF) is pleased to announce that it has entered into an agreement with Northern Securities Inc. ("Northern") pursuant to which Northern has agreed to purchase 7,692,308, units on a firm underwriting basis, subject to certain conditions, at a price of $1.30 per unit (post consolidation) for aggregate gross proceeds to Shift of $10 million. Northern has the option to purchase an additional 1,538,461 units at the issue price at any time prior to 60 days following the closing date for additional gross proceeds of $2,000,000.

Each unit being sold under the offering will be comprised of one common share in the capital of the Company and one-half of one common share purchase warrant. Each whole warrant will entitle the holder thereof to acquire one common share in the capital of the Company at a post consolidation exercise price of $1.80 at any time until the 24 month anniversary of the closing. The offering is expected to close on or about November 24, 2006.

"The success of our initial launch in Western Canada positions Shift as Canada's leading Voice over (VoIP) telecom provider. Our focus will now move to the East, where we have plans to enter the Toronto and Ottawa markets before the end of the year," said Trent Johnsen, President and CEO, Shift Networks. "This financing provides the Company with additional working capital to accelerate our aggressive growth strategy in the six Canadian markets we will be serving."

Contingent on the closing, the Company has also arranged to consolidate Shift's stock on a 1 for 10 basis. The consolidation was approved by shareholders at the Company's annual and special meeting which was held on October 19, 2006 and the consolidation is expected to be completed on or about November 24, 2006. The Company currently has 120,270,375 shares outstanding. After the share consolidation and closing of the offering, the number of shares outstanding will be approximately 19.7 million.

"The management team and board of directors feel the share consolidation will optimize Shift's capital structure and can potentially create better conditions for price appreciation, liquidity and ultimately value to our shareholders," added Mr. Johnsen.

About Shift Networks

Shift Networks Inc. (TSX VENTURE:SHF - News) is reinventing the business phone company by combining premium Voice over IP (VoIP) technology, a strict focus on business customers, and unmatched customer service. Visit us at

Except for historical information, this press release contains forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties, which may cause actual results to differ materially from those statements. Those risks and uncertainties include, but are not limited to, changing market conditions, and other risks detailed from time-to-time in the Company's ongoing filings. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events in this press release might not occur.

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

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