HydraLogic Signs LOI's to Sell Assets and Transfers to NEX

TORONTO, Oct. 12 /CNW/ - HydraLogic Systems Inc. ("HydraLogic" or the "Company") (NEX: HLS.H - OTC Pink Sheet: HYSYF) announced today that it has signed a Letter of Intent (LOI) with a corporation located in Tampa, Florida for the purchase of all the assets in the Company's HLS Ecolo Inc along with other intellectual property. Additionally, the Company signed an LOI with a corporation located in Sarasota, Florida for the purchase of the assets in HydraLogic Systems Corp (HLS Corp) and the business operating as Bug Defence.

The Company is working with the parties to expedite the due diligence process and the preparation of agreements for the purchase of the assets. The transactions are subject to the completion of due diligence, execution of closing documents, approval by the NEX and the shareholders at a special meeting to be held at a time and place to be announced by the Company in the near term. Total consideration for the assets in HLS Ecolo is US$1.5 M and US$1.125 for HLS Corp with a further allowance of up to US$500,000 in assumed trade payables between both. As a pre-condition of the purchase of the assets in HLS Ecolo Inc., the Tampa Corporation has required the executive team contribute up to 15% of the purchase price.

The Company's shares have been transferred to the NEX and trading will remain suspended until the Company is current with its filing of periodic disclosures including annual and interim financial statements. NEX is a separate board of the TSX Venture Exchange (TSX.V) for Companies previously listed on the TSX.V. After the sale of the assets, it is the objective of the Company to file all of its outstanding periodic disclosures and reactivate trading.

About HydraLogic Systems:

HydraLogic is an innovator of engineered misting systems and proprietary environmental chemistries with reoccurring revenue distribution platforms. The company strives to be market leaders in providing technologies, through turnkey distribution and service models into the multi-billion dollar mosquito and odour control industries as Bug Defence and HLS Ecolo respectively.

HydraLogic Systems is traded on the NEX exchange - symbol: HLS.H

Forward Looking Statements

This press release contains certain "forward looking statements". These statements relate to future events or future performance and reflect expectations and belief regarding growth, results of operations, performance, business prospects, opportunities or industry performance and trends. These forward looking statements reflect current internal projections, expectations or beliefs and are based on information currently available. A number of factors could cause actual events or results to differ materially from the results discussed in the forward looking statements. Although it is believed that the forward looking statements contained in this press release are based upon reasonable assumptions, investors cannot be assured that actual results will be consistent with these forward looking statements. These forward looking statements are made as of the date of this press release, and HydraLogic Systems Inc. assumes no obligation to update or revise them to reflect new events or circumstances, except as required pursuant to applicable securities laws.

The NEX Exchange does not accept responsibility for the adequacy or accuracy of this news release.

%SEDAR: 00020350E

For further information:

Michael Beckley
President & CEO
416 740 3900 ext 400
[email protected]