IPICO announces proposed $3.5 million bridge funding



    
    /NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRE
    SERVICES./
    

    TORONTO, Aug. 26 /CNW/ - IPICO Inc. (TSX-V:RFD) announced today its
intention to issue on a non-brokered private placement basis convertible
secured debentures (the "Debentures") for $1,000 per Debenture for gross
proceeds of $3,500,000. IPICO anticipates closing on or about September 10,
2009, subject to satisfaction of customary conditions including execution of
subscription agreements and other documentation, and receipt of all necessary
approvals.
    Proceeds will be used for working capital purposes and to commence the
immediate ramp-up of the manufacture and supply of products required to meet
IPICO's recently announced sales commitments in China, India and Japan, among
others. This additional working capital is required pending completion of the
$10,000,000 private placement of common shares to CATS LUHAI (Beijing)
Investment Co., Ltd. (see IPICO release dated August 25, 2009), which remains
subject to regulatory approvals in China, among other conditions. The proceeds
of that larger private placement will also be used for the same purposes and
to repay the Debentures, to the extent they are not converted.
    Each purchaser of Debentures will receive on closing a commitment fee of
$60 together with 1,000 common share warrants for each Debenture purchased.
The Debentures will mature on the 24th month anniversary of closing and will
be convertible at the option of the holder into common shares of IPICO at a
conversion price of $0.25 per share. The Debentures will bear interest at a
rate of 12% per annum, payable upon maturity or earlier repayment. The
Debentures will be secured by a general security interest over all of the
assets and undertaking of IPICO. Each warrant will entitle the holder to
purchase one common share of IPICO for a period of 24 months from closing at a
price of $0.25 per share. Finder's fees in cash, shares or warrants may be
paid to the extent permitted by regulatory authorities.
    It is a condition of the offering that at least $500,000 of debentures be
subscribed for by directors or other insiders. IPICO has received indications
of interest from a number of directors and senior officers sufficient to meet
that minimum.
    Interested parties may contact Gordon Westwater by email at
gordon.westwater@ipico.com or by phone at (905) 631-6310. This news release
shall not constitute an offer to sell, or the solicitation of an offer to buy,
any securities in any jurisdiction. The Debentures being offered have not been
and will not be registered under the United States Securities Act of 1933 and
state securities laws. Accordingly, the Debentures may not be offered or sold
in the United States except pursuant to applicable exemptions from
registration.

    ABOUT IPICO Inc.: IPICO Inc. is an RFID solution supplier with operations
in Canada, USA, South Africa, Europe, Asia and Australia. IPICO produces smart
labels and tags based on the IP-X communication protocol. IPICO's low
interference readers are designed to meet regulatory requirements in many
major markets, and allow for multi-reader rollout in close proximity. IPICO's
low cost RFID products excel at long read range, fast multi-read
anti-collision and high thru-beam read-speeds of dynamic tag populations.
These products are used to optimize the management of items, people, animals
and processes within the logistic supply chain and other value chains. For
further information, go to www.ipico.com

    This news release contains certain forward-looking statements pertaining
to IPICO's proposed private placement, including statements as to the
anticipated time of closing. Any statements in this news release that are not
statements of historical fact may be considered to be forward-looking
statements. Written words such as "may", "will", "expect", "believe",
"anticipate", "estimate", "intends", "goal", "objective", "seek", "attempt",
or variations of these or similar words, identify forward-looking statements.
These statements by their nature are estimates of future results only and
involve substantial risks and uncertainties, including those detailed from
time to time. Actual results could differ materially from those contained in
the forward-looking statements and are based on current expectations that
involve a number of risks and uncertainties, including, but not limited to,
the inability to close the offering as a result of the failure to settle and
enter into definitive documentation or the failure to receive regulatory or
other approvals on terms acceptable to IPICO and the subscribers. These and
other risks may be detailed from time to time in IPICO's periodic reports
filed on SEDAR.

    
    THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
    RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
    

    %SEDAR: 00023515E




For further information:

For further information: Gordon Westwater, President & CEO, IPICO Inc.,
Tel: (905) 631-6310, E: gordon.westwater@ipico.com

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