SOURCE: Proxity Inc.

November 02, 2007 11:14 ET

Proxity, Inc. Announces Dividend Prior to Merger With Proxity Financial Group, Inc.

NEW ORLEANS, LA--(Marketwire - November 2, 2007) - Proxity, Inc. (PINKSHEETS: PRXT), announced today that it has declared a dividend to the shareholders of Proxity of record on November the 12th, 2007.

The record date is set prior to the merger with Proxity Financial Group, Inc. Upon effectiveness of a planned registration statement to be filed by Techsphere, Proxity expects to receive approximately 3,849,554 Techsphere shares, and plans to distribute a minimum of one Techsphere share for every 78 Proxity shares issued and outstanding on the record date. The exact number of shares to be distributed will be determined on the ex dividend date. Upon effectiveness of a planned registration statement to be filed by Cyber Defense Systems, Inc. (OTCBB: CYDF), Proxity also expects to distribute the Cyber Defense Shares it already owns as previously announced in the amount of one Cyber Defense shares for each 50 shares of Proxity owned.

Proxity also proposes selling its interest in Proxity Electronic Commerce, LLC, and any remaining shares of Cyber Defense Systems, Inc. and the Company shall distribute the net cash from such sale to its shareholders of record on the record date (November 12, 2007). The payment of this dividend is pre-conditioned upon satisfaction of all the requirements of Nevada Revised Statutes Section 78.288, including, that the Company shall be able to pay its debts as they become due in the usual course of business and a determination that the Company's total assets are greater than the sum of the Company's total liabilities plus the amount that would be needed, if the Company were to be dissolved at the time of distribution, to satisfy the preferential rights upon dissolution of stockholders whose preferential rights are superior to the common stock holders.

Techsphere intends to file a registration statement with the U.S. Securities and Exchange Commission to cover the payment of the Cyber Defense dividend and the redistribution of its shares by Proxity. The effective date of the registration statement and the subsequent payment date of the dividend cannot be estimated at this time.

Cyber intends to file a registration statement with the U.S. Securities and Exchange Commission to cover the payment of the Proxity dividend and the redistribution of its shares by Proxity. The effective date of the registration statement and the subsequent payment date of the dividend cannot be estimated at this time.

About Proxity Financial Group, Inc. (PFGI)

PFGI, a project funding and acquisitions company, specializes in providing equity capital and financial, strategic, and operational expertise to assist owners and management teams in providing liquidity for shareholders, making strategic acquisitions, and financing major capital expenditures or growth programs.

The primary requirement is that each project or acquisition has Equity, Collateral Assets, or current revenue streams that facilitate such funding through one or more sources. PFGI primary sources of funding include (but are not limited) to the following:

--  Partnering with Local, State, National, or International Government
    Development agencies relating to the issuance of Investment Grade
    Industrial Revenue Bonds
--  Secondary Offerings of Common Stock
--  Origination of Investment Grade Corporate Bonds
--  Capital provided by Joint Venture or Third Party Sources
    

PFGI utilizes an extensive network of U.S. and International Banks to facilitate the complex process of monetizing these financing instruments and will use its unique position as both the financing organization and majority owner of the projects to provide outstanding potential for its shareholders.

About Proxity

Proxity, Inc. (PINKSHEETS: PRXT) is a developmental holding company specializing in the deployment and marketing of security protection technology and government contract fulfillment. Proxity formed Proxity Electronic Commerce Systems, LLC and owns approximately 35%. The company also owns and controls approximately 15,300,000 shares of Cyber Defense Systems, Inc. (OTCBB: CYDF). Proxity seeks to acquire and develop both internet-based business opportunities and security technology. The Company plans to enter into developmental, teaming and exclusive and nonexclusive marketing and distribution agreements with products developed for Government, commercial, military and homeland defense areas. http://www.proxity.com.

About Proxity Electronic Commerce Systems, LLC (Proxity-EC)

Proxity-EC was founded in 2005 with the goal of becoming the leader in providing information systems dealing with Government logistics databases and vendor awareness of business opportunities in selling both to the Government as well as industry. The founders of Proxity-EC, developers of the PECS Database, are the originators of the current systems of logistics used by industry and the Military including FEDLOGS, Haystack and the ILI Logicom parts database.

The PECS Database provides information on 12 million parts, their suppliers, Government specs and standards as well as non-Government standards, which are linked from the database to the cited standards. The system also provides an alert service on sales opportunities to the Government's 400,000 contractors as well as requisite data used by the Military. For more on Proxity-EC, go to: http://www.proxity-ec.com/

Forward-Looking Statements:

This release contains statements that constitute forward-looking statements. These statements appear in a number of places in this release and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things: (i) the Company's financing plans; (ii) trends affecting the Company's financial condition or results of operations; (iii) the Company's growth strategy and operating strategy; and (iv) the declaration and payment of dividends. The words "may," "would," "will," "expect," "estimate," "anticipate," "believe," "intend," and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company's ability to control and those actual results may differ materially from those projected in the forward-looking statements as a result of various factors.

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