Cardigan Capital completes purchase of Icron Systems Inc.

December 31 1998

Cardigan Capital Corp.
Shares issued: 3,100,000
Dec. 18/98 close: $0.52

Mr. Kelly Edmison reports the company has acquired Icron Systems as its major transaction and the closing of a public offering, with Research Capital Corporation acting as agent. Icron operates an electronics manufacturing services facility in Delta, B.C. and is developing a series of data transmission products based upon the new USB PC communications standard.

The company raised $708,850 through the issuance of 1,417,700 units. Each unit consists of one share and one-half of a warrant. Each warrant entities the holder to purchase one share at 60 cents per share at any time prior to June 30, 1999 and at 75 cents at any time prior to Dec. 31, 1999. The warrants are callable earlier under certain defined circumstances.

The company has applied to the Alberta Stock Exchange for listing of the warrants, subject to satisfying minimum listing requirements. Pursuant to the major transaction the company issued 6,162,834 shares and $285,000 of convertible debentures, 75,000 convertible preferred shares, 585,500 options to purchase shares and a convertible note convertible into 425,000 shares. The net proceeds of the public offering will be used by Icron to purchase capital equipment, to reduce trade accounts payable and to finance USB product development and marketing.

Douglas Kind has been appointed as president and CEO, David Dunnison as vice-president business development and Lissa-Maria Pietracupa as secretary. Kelly Edmison has resigned as President and Secretary of the company but will continue as a director.

Note: The company relies on litigation protection for “forward-looking” statements. The Canadian Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
FORWARD-LOOKING STATEMENTS: Except for statements of historical fact, all statements in this news release – including, without limitation, statements regarding production estimates and future plans and objectives of Icron – are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from those anticipated in such statements.