SOURCE: INFRAX Systems, Inc.

May 03, 2010 16:58 ET

INFRAX Systems (IFXY) to Buy Trimax Wireless

Combined Companies Targeting North of $20BN in Stimulus and Government Sanctioned Opportunities in Smart Grid and Wireless Broadband Markets

ST. PETERSBURG, FL--(Marketwire - May 3, 2010) -  INFRAX Systems, Inc. (OTCBB: IFXY), a global provider of interrelated operational management, and communications-related products and services for the Telecommunications and Energy industry, today announced that it has entered into an agreement to acquire Trimax Wireless, Inc. (Trimax), a privately-held, leading edge designer, developer and manufacturer of advanced broadband wireless equipment and other innovative technologies.

Under the terms of the agreement, INFRAX Systems will acquire Trimax Wireless for approximately $10M in a combination of cash and Preferred stock, convertible into common stock at a price of $0.20. The final purchase price will be based on a third-party valuation of Trimax's business and holdings. INFRAX will continue to support the existing Trimax customer base and the development of future products based on the unique patented Trimax architecture.

Trimax 2009 wireless broadband revenues exceeded $1.2M, with forecasted 2010 wireless broadband revenues in excess of $6.0M, on a standalone basis. INFRAX anticipates significant revenue growth as a result of integration of the Trimax technology into the INFRAX product line, and by providing capital to Trimax to enable the Company to execute on its core competencies in the broadband equipment markets in the rural U.S. and abroad. The Trimax technical team's multi-disciplined expertise will augment INFRAX's technical capabilities and the management of the combined Companies will include executives and Board members from both organizations.

Allows Combined Companies to Target Multiple Billions of Dollars in Revenue Opportunities

According to the Energy Information Administration, or EIA, the electric utility market is one of the largest industries in North America and globally the industry is expected to spend close to $10 trillion by 2030 to upgrade and effectuate Smart Grid technologies. In the U.S., the Federal Government forecasts that the total amount of private and public funds that will be invested in smart grid projects through a stimulus program will be $8.1 billion.

Per the July Pacific Crest Mosaic Smart Grid Survey of industry leaders with budgeting or technology selection responsibilities, utilities consider two-way communications the most important technology in creating a fully operational Smart Grid. Information Week forecasts that the fully operational Smart Grid could need up to $100 billion worth of networking technologies such as routers, switches, and secure IP-based backhaul communications.

The U.S. Department of Energy, and numerous studies indicate, the societal case for Smart Grid adoption is fundamental, lasting and real. According to the International Energy Agency, the United States and Canada need to add additional capacity at a cost of $1.6 trillion between 2003 and 2030 to meet the projected demand for electricity. Creating a Smart Grid with an intelligent network, much like the telecommunications industry, over the next 20 years, could save $46 billion to $117 billion. This would create a substantial opportunity for companies much like INFRAX Systems.

Meanwhile, the communications equipment market represents hundreds of billions of dollars of revenue opportunity worldwide. Spending in the U.S. has accelerated, aided by recently mandated government stimulus funding. For example, of the recently approved $7.2 billion in Recovery Act funding, approximately $2.5 billion will go to the Rural Utilities Service Broadband Initiatives Program (BIP), to improve broadband infrastructure in rural areas of the U.S. The remaining $4.7 billion will go to the National Telecommunications Information Administration's Broadband Technology Opportunities Program (BTOP) which will fund broadband improvement in "underserved" areas -- that is, areas that aren't necessarily rural but are definitely underconnected, such as lower income urban areas.

Commentary, Details

The acquisition will strengthen INFRAX's Smart Grid solution portfolio, allowing for the deployment of a robust integrated end-to-end device management and communication solution for Utilities and Energy providers. Additionally, Trimax's current deployments in the United States and internationally in Europe, Africa, and Latin America, will further enhance INFRAX's global reach and create future revenue opportunities.

Headquartered in Naples, Florida, Trimax provides next generation intelligent wireless infrastructure solutions for a variety of market segments globally. The exclusive combination of technologies offered in Trimax modular solutions present a real breakthrough in wireless network design and deployment, allowing Utility and Carrier customers to leverage the best of each technology. Based on a modular, scalable, and flexible architecture, Trimax's products are very cost effective and fully ruggedized for deployment in demanding Utility and emerging markets environments.

"Trimax's innovative product portfolio will play a pivotal role in our communications solutions for middle mile and last mile applications. This technology is core to solving connectivity issues presented by the deployment of thousands of intelligent devices along the electrical grid. Combining Carrier-Grade connectivity with a security enhanced network management platform will be a key differentiator for our solutions," said Paul J. Aiello, CEO of INFRAX. "The current customers and partners of Trimax will also benefit from access to INFRAX's network and element/device management portfolio."

"INFRAX presents an exceptional opportunity for Trimax to integrate its products into a new set of targeted solutions for the Utility sector, opening interesting new opportunities," said Ulrich Altvater, CEO of Trimax Wireless. "We believe our combined technologies and strengths will become a driving force for future Smart Grid deployments and broadband network growth worldwide."

As part of the transaction, INFRAX has engaged Source Capital Group, Inc. (www.sourcegrp.com), a boutique investment bank headquartered in Westport, CT with expertise in micro-cap growth companies in the Utility and Communications markets. According to SCG Managing Director, Investment Banking, Vik Grover, CFA, "The combination of INFRAX and Trimax should unlock considerable value as the two Companies attack multiple billions of dollars of stimulus-funded markets in the U.S. and the significant pent-up demand abroad for communications networks. This transaction is just the first step in a series of transactions that should position INFRAX as a market leading provider of one-stop shop Smart Grid and Broadband Equipment Solutions in the U.S. and abroad."

The acquisition is expected to close within 60 days after the completion of due diligence. Additional financial details of the transaction will be disclosed with the completion of the acquisition or when available.

About Trimax Wireless

Trimax Wireless, Inc. is a leading edge designer, developer and manufacturer of broadband wireless equipment and other innovative technologies.

With the TMAX™ family of products, the company has developed an extremely flexible and versatile wireless IP infrastructure, by leveraging standards-based and emerging technologies. Trimax currently manufactures and distributes globally advanced wireless integrated solutions used to build voice, streaming video and data broadband wireless networks. Trimax's unique modular architecture creates affordable capacity by making the most efficient use of every technology applied.

Trimax products and services allow communication service providers ("local exchange carriers" or LECs, and telephone companies or Telcos), Internet service providers ("ISPs") and other telecommunications users, such as utilities, cable companies, enterprises, municipalities, universities, hospitals, hospitality companies, etc. to effectively build massive scale, outdoor, triple play networks that provide high quality / high speed broadband, mobile and fixed phone and video services utilizing radio frequencies instead of wires. Trimax Wireless, Inc. has developed and owns the proprietary rights for the advanced TRIMAX (TMAX™) radio technology integration. The TMAX product line consists of a series of base stations, wireless broadband routers and edge nodes, including customer premises equipment, which can effectively deliver multiple applications through the same network infrastructure.

For Trimax Wireless information, visit www.trimaxwireless.com.

About INFRAX Systems

INFRAX Systems, Inc. provides a series of interrelated operational management, communications, and energy grid related products and services which enable a comprehensive and unified solution for communications and applications management of the Smart Grid, municipal and telecommunications networks. The Company's Wireline, Wireless and Fiber Optics network management solutions offer proprietary state-of-the-art software, professional services and integrated systems. INFRAX Systems have been in use by companies seeking the best solution in managing their fiber and coaxial networks for the past 10 years. The Company's software solutions keep track of all aspects of the physical inventory such as fiber builds, access and splice points and connected equipment, in addition to fault isolation and work order management. The scalability of the software systems permits the Company to target small to large Electric Utilities, Cable and Telecom companies on a worldwide basis. Besides the OptiCon Network Manager™ (ONMS), the Company will soon offer additional products and services designed to secure and manage the power grid and alternate energy networks globally.

For INFRAX Systems information, contact Investors@InfraxInc.com or visit www.infraxinc.com.

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