Applied Inventions Management Inc. - Letter Of Intent.

TORONTO--(BUSINESS WIRE)--Feb. 1, 1996--APPLIED INVENTIONS(CANADIAN DEALING NETWORK: AIMC.A AIMC.B ) Applied Inventions Management Inc. ("Corporation") is pleased to announce that it has entered into a Letter of Intent to acquire all of the issued and outstanding shares of a Federally chartered non-offering Company ("Lighting") from its sole Shareholder.

Lighting imports, manufacturers, distributes, markets and sells lighting fixtures, which are sold to major lighting showrooms, wholesale electrical distributors, and home centres and department stores across Canada through independent sales agents for over 15 years. Gross revenue for the past three years (1993, 1994 & 1995) have been $7.4 Million, $6.3 Million and $4.6 Million respectively. Net profits (Loss) have been $135,000, $8,400 and ($239,000) respectively.

At Closing, the Shareholder shall exchange all the shares issued and outstanding of Lighting in exchange for:

(a) $50,000.00

(b) A maximum of 325,000 Preference shares ("Preference Shares") to be issued to Shareholder from the treasury of the Corporation, subject to adjustment for Net Book Value and Account Receivable guarantee. The Preference Shares to be issued shall be non-voting; non-participating; convertible at any time at the option of the holder into Class "A" subordinate voting shares on a one-for-one basis and if converted, are subject to a voluntary trading restriction for eighteen months from the Closing or retractable at the option of the holder at $1.00 per share, at any time within 90 days after eighteen months from the Closing and subject to the trading restrictions of the Securities Act (Ontario) if converted; and shall have preferential repayment (over Class "A" and Class "B" shares) of paid up capital in the event of liquidation, winding-up or distribution of assets of the Corporation.

(c) 250,000 warrants, each warrant entitling the holder to purchase one Class "A" Share at $2.25 per share during the first twelve months from the Closing or at $3.00 per share during the next and last twelve months;

(d) an option to purchase up to 45,000 Class "A" subordinate voting shares of the Corporation at the applicable regulatory discount price permitted, expiring ten years from the date of issuance and granted pursuant to the terms of the prevailing stock option plan of the Corporation; and

(e) a guarantee by the Shareholder that all of the Accounts Receivables of Lighting are collectible within 120 days of the Closing, failing which the consideration paid by the Corporation shall be adjusted in the face amount of the un-collected Accounts Receivable 121 days after the Closing, firstly be reducing the number of Preferred Shares to be issued to the Shareholder for any amount less than 5 percent of the aggregate Account Receivables at Closing, and secondly by a certified cheque payable to Lighting by the Shareholder for the balance of such uncollected Accounts Receivable. There will be no change in control if all the Preference Shares are converted into Class "A" subordinate voting shares, on a fully diluted basis.

Current management of Lighting shall remain and the Shareholder of Lighting shall enter into a one year renewable non-compete consulting agreement with Lighting respecting his management, marketing, product development and merchandising services.

The transaction is subject to satisfactory completion of due diligence including delivery to the Corporation on or prior to March 15, 1996 of an audited financial statement of Lighting prepared in accordance with generally accepted accounting principles as at January 31, 1996 (the "Effective Date of Closing") reporting Shareholder's loan not exceeding $ 600,000.00 and net realizable book value excluding liability for Shareholder loan of Lighting not less than $ 1,200,000.00 of which not less than $ 540,000.00 thereof shall consist of cash and accounts receivable; arranging financing acceptable to the Corporation; the execution of a definitive agreement on or before February 9th, 1996; regulatory approvals, consents and/or exemptions and approvals of the respective directors and, if necessary shareholders of the Corporation and Lighting in each case in the form and substance satisfactory to each party.

It is anticipated that the effective date of the transaction shall be January 31, 1996 with a Closing date of April 15, 1996.

The Corporation is also pleased to report that the proposed transaction between its wholly-owned U.S. subsidiary, Applied Inventions Management Corp. - U.S.A. and Tour Technologies, Inc. ("TTI") as reported on a previous press release dated November 30, 1995 is progressing. The parties have agreed to the terms of a definitive agreement, and the execution and delivery of the agreement is subject to the delivery by TTI of exhibits, schedules and disclosure documents no later than February 15, 1996.

The Corporation, through its wholly-owned U.S. subsidiary will acquire all of the property, assets and undertakings of TTI, as a going concern, for consideration of $300,000.00 U.S.D. to be paid and satisfied by the issuance of a maximum of 227,778 Class "A" subordinate voting shares, to be issued from the treasury of Applied Inventions Management Inc., subject to any adjustment regarding Capital Assets. The closing of this transaction, subject to the receipt of the above documentation, is conditional upon compliance of any regulatory approval, consents and compliance with applicable securities legislation.

TTI, a private Montana corporation, owns Tour Information Systems ("TIS"), a development and marketing company specializing in the production and dissemination of interpretive programming. The initial focus of TIS has been to develop and market the TOURGUIDE System, a unique new interpretive product specifically designed to convey high quality interpretive programs for automobile tours.

TIS has demonstrated its ability to work effectively with the U.S. National Park Services ("NPS") through the development of its TOURGUIDE System car audio tours for Yellowstone National Park and Little Bighorn Battlefield National Monument. The first TOURGUIDE program developed for Yellowstone National Park won First Place at the National Association of Interpretation's 1994 Media Awards Competition ("NAI") and second TOURGUIDE program, developed for Little Bighorn Battlefield National Monument, recently won First Place at the NAI 1995 Media Awards Competition confirming TIS commitment to provide a consistent, high quality program. A third TOURGUIDE program is currently being developed for Everglades National Park in Florida.

Applied Inventions markets and sells a patented swimming pool/spa intrusion alarm system under the name SAVE Plus. Its shares trade on the Canadian Dealer Network Inc. under the symbols "AIMC.A" or "AIMC.B".

CONTACT: Applied Inventions Management Inc.

Michael B. Stein, [phone]

President