IP Applications Closes Financing and Aligns Interests

VANCOUVER, May 2 /CNW/ - IP Applications Corp. (TSX-Venture: IPX), a
leading provider of outsourced Internet Solutions, today announced that it has
closed the previously announced $800,000 financing and completed a number of
other matters to align the board and interests of management and staff with
the interests of the shareholders.
The Company also announced that Mr. Kelly Edmison has been appointed
Chairman of the Board. The Board of Directors of the Company now consists of
Mr. Edmison, David Roberts and Mark Sampson. The directors are actively
seeking an independent director to add to the Board.
Chairman Kelly Edmison said "This financing represents the completion of
the second stage of the reorganization that we started 15 months ago when the
Pender Group made its first significant investment in IP Applications and Mark
Sampson took over as President. Collectively, members of the Board and
Management, including Pender Growth Fund and Pender Financial Group, now
control over 55% of the Company's issued shares. Everyone's interests are now
aligned and we have a common goal to enhance shareholder value."
The closed non-brokered private placement consists of 2,424,242 common
shares at a price of $0.33 per share for gross proceeds of $800,000. Pender
Growth Fund (VCC) Inc. and Pender Financial Group Corporation led the
financing and certain officers and employees of the Company participated. A
total of 2,205,150 warrants held by participants in the private placement were
surrendered for cancellation on a one-to-one basis for new warrants, with each
new warrant entitling the holder to purchase an additional common share of the
Company at $0.35 for the first year and $0.40 for the second year after
issuance. The Company also issued 333,333 common shares at a deemed price of
$0.75 per share in lieu of cash on the exercise of the Cashless Put Warrants
that were issued to Pender Growth Fund (VCC) Inc. in December 2004.
The Board of Directors also approved, subject to receipt of regulatory
approval, the payment of bonuses to senior management of the Company by way of
the issuance of a total of 407,300 common shares at a deemed price of
$0.33 per share, of which 195,000 common shares are to be issued upon
management meeting certain operating conditions, the re-pricing of a total of
966,620 stock options held by directors, officers and employees to $0.55 per
share, and the granting to officers, employees and a new director of options
to purchase 456,212 common shares at $0.55 for a period of five years. The   
re-pricing of options held by directors and officers will be subject to
approval by disinterested shareholders at the Company's next annual general
meeting.
On the closing of this financing and issuance of the management bonus
shares, the issued share capital of the Company is 12,136,626 shares, and
assuming all conditions are satisfied and necessary approvals contemplated
above are granted, the fully diluted share capital will be 16,964,458 shares.

About IP Applications
IP Applications delivers web services, applications, and support,
developed for large-scale providers, designed for individual users. The
combination of carrier-grade facilities, mass provisioning capabilities and
dedicated technical and sales professionals makes IP Applications a trusted
strategic partner to Telecoms, Enterprises and BPL providers. The 24/7
multilingual help desk offers clients and their subscribers a value-added
complement to a wide variety of IP products and services such as network
monitoring and OSS.

Forward Looking Statements
The press release may contain forward-looking statements. Actual events
or results may differ materially from those described in the forward-looking
statements due to a number of risks and uncertainties. Forward-looking
statements are based on management's estimates, beliefs and opinions. The
company assumes no obligation to update forward-looking statements.

The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release.

Signed

"Shay Prasad"

Shay Prasad
Chief Financial Officer