OxyFile #528

LifeTech to Raise $2 Million Through Subordinated Convertible 


TORONTO, Oct. 29, 1997 - LifeTECH Corporation announced today that 
it has entered into an agreement to raise $2 million through a 
subordinated convertible debenture and common share purchase 
warrants to be issued to Encore Distribution Limited of St. 
Helier, Jersey. The financing, which was arranged by Trinity 
Capital Securities Limited of Toronto, Ontario is scheduled to 
close no later than November 7, 1997. Encore has successfully 
concluded its due diligence examination of LifeTECH and its 
proprietary technology for the sterilization of blood and blood 
components. On the completion of the financing, Encore's financial 
contribution will be augmented by their assumption of four 
positions on the Corporation's Board of Directors.

In making the announcement, Walter J. Dermott, President and CEO, 
stated "This infusion of capital will support our accelerated 
development activities, including the generation of data for third 
party Pre-Clinical Trials, to establish the Sterinetics System as 
the world's premier blood and biological fluid sterilization 
technology. The embryonic market for biofluid sterilization, which 
is projected to be $6-$10 billion worldwide, is just now being 
recognized by the scientific and biotechnology communities. 
LifeTECH fully intends to dominate this new market with the only 
blood sterilization technology that can inactivate all viruses and 
bacteria in one economical operation. This investment, along with 
the expected proceeds from our rights offering, creates a sound 
financial basis for our future progress."

Under the terms of the subordinated convertible debenture, Encore 
will invest $2 million, convertible into common shares at a 
conversion price of $0.60 per common share. Encore will also be 
granted warrants to purchase 2 million common shares at $0.50 per 
common share for a term of five years. The debenture has a term of 
5 years and carries an interest rate of 5% per annum, payable 
annually in cash or stock. As security for the debenture, LifeTECH 
will grant Encore a charge on all LifeTECH assets, including 
patents. Closing is subject to several conditions, including 
satisfactory legal, corporate and tax opinions and the completion 
of documentation satisfactory to both LifeTECH and Encore.

On October 7, 1997, LifeTECH announced a rights offering to 
existing shareholders and warrantholders, issuing 6,126,368 rights 
to purchase one common share per right at $0.50 per common share. 
The rights offering expires on October 30, 1997. Due to the 
material change in circumstances created by the new debenture 
financing, LifeTECH has filed an amendment with the Ontario 
Securities and Alberta Securities Commission to extend the rights 
offering period to November 10, 1997 to allow adequate 
dissemination of this important news.