Noveko International closes initial amount of $11.7 million private placement

Oct 12 2009

Noveko International Inc. ("the Company") is pleased to announce the closing of an initial amount of $11.7 million (the "first Closing") of its previously announced best efforts private placement (the "Offering"). It is expected that a second and final closing of the Offering will occur no later than October 30, 2009.

Pursuant to the first Closing, each Unit was offered at $2.20 and consisted of one (1) Class A share of the Company (a "Class A Share") and one-half of one Class A Share purchase warrant (each whole Class A Share purchase warrant, a "Warrant"). Each Warrant entitles its holder to purchase, at a price of $3.00 per share, one Class A Share for a period of 36 months following the first Closing, subject to acceleration as described below. Accordingly, a total of 5,301,000 Class A shares were issued by the Company and an additional 2,650,500 Class A shares may be issued upon due exercise of the Warrants. Also, the option previously granted by the Company to the Agents (the "Agents' Option") was modified and is now exercisable at any time up to 30 days following the first Closing.

The Warrants are subject to an acceleration clause whereby, if the Company's Class A Shares trade at a price per share equal to or higher than $4.50 on a weighted average basis for a period of 20 consecutive business days on the TSX, and upon notification by the Company through the issuance of a press release, the period during which the Warrants may be exercised will be decreased to a period of 30 days (the "New Exercise Period") that will begin at the last of the following dates: (i) the first business day immediately after completion of the 4 month plus one day hold period, or (ii) the first business day immediately after the above mentioned 20 consecutive business days, but, in both cases, the New Exercise Period shall not end later than the initial 36 month period. Upon the expiry of the New Exercise Period, the Warrants will no longer be exercisable.

The net proceeds of the Offering will be used to pursue the Company's global growth objectives, namely, fund the expansion of its international distribution networks, develop its current IP portfolio, develop new innovative applications, expand its production capacity, and for working capital purposes.

The Offering is being made pursuant to exemptions from prospectus requirements and is subject to the usual conditions and the receipt of all required regulatory approvals, including approval of the Toronto Stock Exchange.

The securities offered have not been registered, and will not be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.