Backbone Completes First Round of Financing

VANCOUVER CANADA, December 31, 2005 - Sarah Morton, CEO of Backbone is pleased to announce the completion of the company’s seed round of financing.

This financing was led by Fundamental Technologies II. Dr. Basil Peters, CEO of Fundamental, said: “Backbone is capitalizing on one of the most exciting new trends in information technology - the transformation of hardware and software from a capital asset to a pay-as-you-go service. Everyone from Bill Gates to Scott McNealy has said this is a very significant change in how companies will deploy their IT infrastructure.”

Other investors in this round included Mike Volkers’ WUTIF fund, Talal Yassin, Dr. Don Rix and David Greer.

This financing was accelerated by the company’s presentations at the Bob Chaworth-Musters Angel Forum and Mike Volkers’ Vantech Angel Forum.

David Greer has also agreed to become an advisor to Backbone. David added: "Sarah has a long history as a successful reseller in the SMB space. She knows the customers and has demonstrated that the SMB market is ready for software as a service by her initial product launch and customer sales."

Backbone is has already added 14 products and 75 users to its systems. The company is planning its next round of expansion financing early in 2006. The seed round investors have all made soft commitments to participate in this round.

About Backbone
Backbone Systems and Networks Corporation delivers IT as a pay-as-you-go service, making technology deployments easier and more affordable.

[Signed - Sarah Morton]

CEO
Backbone Systems and Networks orporation