Feb 17, 2010

HDX to raise up to $15 million to complete acquisitions

TORONTO--Hosted Data Transaction Solutions Inc. is raising up to $15 million to continue its acquisition strategies.

This financing is being undertaken to increase the working capital position of the company and satisfy the cash components of two recently announced letters of intent to acquire 100% of the shares in both Cash 'N Go Ltd. of Edmonton and Posera Inc.of Seattle, Washington. Upon completion of these acquisitions, HDX will have over 26,000 quick service and table service restaurants as customers for its point-of-sale solutions and will possess a robust payment switch platform that can be upgraded to provide debit and credit payments processing for these customers. This will enable HDX to truly serve as a full payments and POS solutions provider, with the opportunity to generate significant, incremental, profitable revenue.

Financing Details
Each Subscription Receipt will entitle the holder to acquire one HDX common share and one-half of one common share purchase warrant of HDX, without payment of additional consideration. Each whole HDX warrant will be exercisable for one HDX common share at a price to be determined for a period of two years after the closing date.

Approximately $9 million of the net proceeds will be used to fund the acquisition of Cash N Go and Posera and the balance will be used for working capital. The gross proceeds will be held in escrow and released to complete the acquisitions following the receipt of all required approvals and consents and the satisfaction of all conditions precedent other than payment of the proceeds for the acquisitions (the "Release Conditions"). Unless consent of the Subscription Receipt holders is obtained, in the event that the Release Conditions are not satisfied on or before that date which is 90 days following the closing date (the "Release Deadline"), holders of the Subscription Receipts shall be entitled to receive, in exchange for such holders' Subscription Receipts, an amount equal to the aggregate purchase price paid for their Subscription Receipts.

Completion of the Offering is subject to receipt of all necessary regulatory and other approvals, including TSX approval. Additionally, under Section 611 of the TSX Manual, the Company intends to obtain Shareholder Approval by way of written consent of shareholders holding in excess of 50% of the issued and outstanding shares of HDX, subject to TSX approval. It is anticipated that the offering will be priced in the context of the market and that the closing of the Offering will be priced in the context of the market and that the closings of the acquisitions will occur on or about April 15, 2010 and HDX will use its best efforts to qualify, by way of prospectus, the issue of Units upon the exercise or deemed exercise of the Subscription Receipts as soon as possible prior to the closing of the acquisitions.