TEK DigiTel Corporation Secures Interim Financing
Initial Stage of Long Term Financial Negotiations Completed

GERMANTOWN, MD—October 7, 1999    TEK DigiTel Corporation (OTC BB: TEKI) today announced that they have received the proceeds from a short-term loan of $500,000 US which will be used as working capital, volume manufacturing start-up and to fulfill several marketing program commitments. This completes the first stage in a process in which the company expects to secure long term equity financing in the order of $5.5 M US.

The loan, which is currently unsecured and bearing interest at 0% annually, comes from a private, arms-length investor who is also in negotiations with TEK DigiTel concerning the longer-term equity financing. It is expected that this equity investment will be a combination of common shares and warrants which are exercisable over a 12 month period and are based upon the company achieving its business plan goals. The terms of the equity financing are expected to be finalized within the next 30 days, at which time the original $500,000 loan will also be converted to equity.

"Over the next 90 days, the company will be ramping up marketing efforts through increased hiring, expanded Internet presence, and participation at premier industry events such as ISPCON and COMDEX Fall '99." explains Enghe Chimood, Chairman of the Board of TEK DigiTel Corp. "In addition to marketing efforts such as these, focused on increasing market awareness, this funding will also enable TEK DigiTel to expand manufacturing partnerships to meet customer demand."

This financing also coincides with TEK DigiTel’s engagement of the appropriate audit and legal partners to move toward full reporting company status. The audit process is already underway and all the appropriate filing documentation has been obtained from the SEC. The company should have an update on final timing within the next month.

About TEK DigiTel Corporation (http://www.tekdigitel.com)

Based in Germantown, Maryland, TEK DigiTel Corporation delivers integrated CPE (Customer Premise Equipment) communications solutions optimized for use in SOHO, small- and medium-sized businesses. Working with Service Providers and OEM partners, the Company is focused on integrating fax- and Voice-over-IP (VoIP) technologies with conventional PBX systems and data routing devices to create a low- cost, easy-to-use Internet communications hub. Founded in 1998, TEK DigiTel is publicly traded (OTC BB: TEKI) and headed by a management team with extensive related experience gained at leading manufacturers and service providers including Motorola, 3Com, IBM, Nortel Networks, Rockwell, Hughes, MCI Worldcom, Bell Atlantic, Bell Canada, BellSouth, and GTE.

Statements in this news release looking forward in time involve risks and uncertainties, including the risks associated with the effect of changing economic conditions, trends in the development of the Internet as a commercial medium and carrier of telephony traffic, market acceptance risks, technological development risks, seasonality and other risk factors.