Mr. Jerry Trent reports

PRINCIPAL TECHNOLOGIES ANNOUNCES PRIVATE PLACEMENT FINANCING

Principal Technologies Inc. has arranged a non-brokered private placement financing of up to four million common shares of the company at a price of 30 cents per common share for aggregate gross proceeds of up to $1.2-million. The proceeds of the offering are intended to be used for general working capital purposes.

The common shares to be issued in connection with the offering will be subject to a statutory hold period of four months from the date of issuance in accordance with applicable Canadian securities legislation. The offering is subject to the receipt of all requisite approvals, including the acceptance of the TSX Venture Exchange.

Related party participation in the offering

An insider of the company will be participating in the offering. The participation by Roman Leydolf, a significant shareholder of principal, constitutes a related party transaction as defined under Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions. The company will be relying on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101, as neither the fair market value of the securities purchased by the insider, nor the consideration for the securities paid by such insider, will exceed 25 per cent of Principal's market capitalization. The company expects that the closing of the offering will occur within the two weeks following this announcement and that it will not file a material change report in respect of the related party transaction at least 21 days before the closing. The company deems this circumstance reasonable in order to complete the offering in an expeditious manner.

About Principal Technologies Inc.

Principal Technologies is a Canadian-based health care technologies acquisition company. The company is engaged in building a global portfolio of profitable health care technology companies with a focus on those with global distribution potential that have intellectual property capable of enhancing medical treatment quality, cost-efficiency, optimization of the patient pathway and implementation of point-of-care technologies.

We seek Safe Harbor.