Datacom Wireless Corporation

Datacom Wireless Corporation
BSM Technologies Inc.

BSM Technologies Inc.

August 21, 2009 17:06 ET

BSM Technologies and Datacom Wireless Enter Into Definitive Agreement for a Business Combination to Create a Major Player in the Canadian Telematic Market

WOODBRIDGE, ONTARIO and LAVAL, QUEBEC--(Marketwire - Aug. 21, 2009) - BSM Technologies Inc. ("BSM")(TSX VENTURE:GPS) and Datacom Wireless Corporation ("Datacom") (TSX VENTURE:DAT) are pleased to announce that further to their joint press release of July 2, 2009, they have now entered into the definitive business combination agreement (the "Definitive Agreement"), whereby BSM and Datacom have agreed upon the definitive terms and conditions with respect to the proposed business combination of the two companies (the "Proposed Transaction").

The Proposed Transaction

The Definitive Agreement contains customary representations and warranties by BSM in favour of Datacom and by Datacom in favour of BSM and such other terms, covenants and conditions as would be customary for a transaction of this nature. Each of BSM and Datacom will mail information circulars to their respective shareholders the week of August 24 outlining in detail the terms of the Proposed Transaction and each of BSM and Datacom have scheduled shareholders' meetings to seek shareholder approval of the Proposed Transaction on September 23, 2009. Closing of the Proposed Transaction is scheduled to occur on or about September 25, 2009.

As of the date hereof, the number of common shares in the capital of Datacom (the "Datacom Shares") that are outstanding is 27,951,221. There are 1,068,791 Datacom Shares issuable upon exercise of outstanding stock options of Datacom. The number of common shares in the capital of BSM (the "BSM Common Shares") that are outstanding is 85,907,730 (including 547,900 in escrow subject to BSM's performance). There are 6,175,000 BSM Common Shares issuable upon the exercise of outstanding stock options of BSM (the "BSM Options"), 57,309,522 BSM Common Shares issuable upon the exercise of outstanding common share purchase warrants of BSM (the "BSM Warrants") and 56,309,522 BSM Common Shares are issuable upon the conversion of outstanding convertible debenture of BSM (the "BSM Debentures").

As previously disclosed, immediately prior to completion of the Proposed Transaction, subject to regulatory and shareholder approval as required, $1.75 million of the BSM Debentures and BSM Warrants, out of a total of $3.45 million in principal value, held by certain holders, will be purchased by some other existing debenture holders and other new investors. Thereafter, BSM will create one series of convertible preferred shares (the "BSM Preferred Shares"), exchange its outstanding BSM Debentures into the BSM Preferred Shares and exchange BSM Warrants into BSM Common Shares (the "BSM Pre Merger Reorganization").

As a result of the proposed BSM Pre Merger Reorganization, and prior to the Proposed Transaction, the share capital of BSM will be 108,928,691 BSM Common Shares and 65,755,556 BSM Preferred Shares, and there will be 6,175,000 BSM Options outstanding.

The Proposed Transaction will be in the form of an amalgamation of Datacom with a wholly-owned subsidiary of BSM. Each Datacom Share will then be exchanged for approximately 4.2421 BSM Common Shares such that, upon completion of the Proposed Transaction, the former holders of BSM Common Shares, BSM Preferred Shares and BSM options will own 59.5% (180,859,247 out of 303,965,120) of all BSM securities outstanding, on a fully diluted basis, and former holders of Datacom Shares and Datacom options will own 40.5% (123,105,873 out of 303,965,120) of all BSM securities outstanding, on a fully diluted basis. It is intended that BSM will continue to be listed on the TSX Venture Exchange.

All options to purchase BSM Common Shares that are outstanding at the time of the closing of the Proposed Transaction will remain outstanding in accordance with their terms. Each option to purchase Datacom Shares will be replaced with approximately 4.2421 options to purchase BSM Common Shares and the exercise price for such option will be the original exercise price divided by approximately 4.2421. It will be the same conversion ratio as that used to convert Datacom Shares into BSM Common Shares. A fairness opinion has been obtained by Datacom from Paradigm Capital who has confirmed that the consideration payable to the shareholders of Datacom is fair from a financial point of view.

On completion of the Proposed Transaction, the board of directors shall initially be comprised of nine directors, five of the nine will be nominees of BSM, the others will be nominees of Datacom.

Description of Conditions to Closing

Completion of the Proposed Transaction is subject to a number of conditions, including, but not limited to, acceptance from the TSX Venture Exchange (the "Exchange") and other shareholders, third party and regulatory approvals as may be required. The Definitive Agreement provides for a reciprocal break fee in the amount of $500,000 and notification by each party of the receipt of alternative proposals from third parties. Each party has agreed not to solicit other proposals but has reserved the right for each board to exercise its fiduciary duties. BSM has been advised by the Exchange that the Exchange will require BSM to obtain disinterested shareholder approval for the issuance of BSM Preferred Shares, the purchase of $1.75 million of the BSM Debentures and BSM Warrants (held by certain holders) by some other existing debenture holders and other new investors, the exchange of BSM Debentures into BSM Preferred Shares and the exchange of BSM Warrants into BSM Common Shares. Datacom needs its Shareholders' approval for the amalgamation.

About Datacom Wireless Corporation

Founded in 1999, Datacom has grown to become one of the Canadian leaders in the design, development and marketing of mission critical vehicle fleet management and theft prevention solutions. Its products and services use wireless communications and satellite-based tracking technologies (GPS) and a state-of-the-art ASP information portal.

About BSM Technologies

BSM Technologies designs, manufactures and markets a comprehensive line of AVSL ("Automatic Vehicle Security and Tracking") solutions for Commercial and Government Fleet Management, including Law Enforcement, through its subsidiary BSM Wireless. The BSM line of products range from Fleet Management and Consumer Vehicle Protection offerings to the full featured ''Stinger'' product featured in news media worldwide as the key technology behind the Bait and Covert application used by hundreds of Law Enforcement agencies to deter vehicular, trailer and heavy equipment theft.

Superior functionality, seamless switching between two separate footprints, enhanced reliability, advanced security features, and excellent value characterize BSM products. By incorporating advanced wireless locating and mapping technology, and IP-based communications protocols, the BSM line of products provides sophisticated real-time monitoring and control of commercial and personal vehicle assets to meet the demanding needs and stringent requirements of today's mobile environments. BSM's unique end to end solutions feature sophisticated wireless hardware, firmware and software all developed by and proprietary to BSM. The BSM product line can be easily adapted and customized to match any customer user requirement while BSM's in-house support infrastructure assures that all clients receive the premium AVSL solution in the industry to meet their needs.

About SecTrack

SecTrack sells Inmarsat D+ transceivers and airtime subscription to value added resellers around the world. These VARs are typically local companies who have built a proper monitoring and tracking service for end-users in a multitude of maritime and land based sectors including nuclear transport monitoring, mining, security tracking of trucks, trailers and other vehicles and tracking of airplanes and rescue helicopters. The company's customer base is spread over Europe, Asia, Africa and Central and South America.

About Netistix Technologies

Incorporated in 2002, Netistix Technologies Corporation is headquartered in Ottawa, Canada and has developed a comprehensive and customizable wireless fleet management solution known as "FleetPulse".

The Netistix "FleetPulse", Wireless Fleet Management System, delivers actionable information that reduces fleet operation and environmental costs, improves productivity and increases safety.

For more information, please visit

Except for historical information contained herein, certain statements contained in this release constitute forward-looking information. These statements relate to future events or future performance. The use of any of the words "could", "intend", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on BSM's or Datacom's current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. In particular, this release contains forward-looking information relating to: the intention of Datacom and BSM to enter into the Definitive Agreement and the terms and conditions of the Proposed Transaction, including securities to be issued pursuant thereto, the board composition of BSM following the Proposed Transaction and the closing date of the Proposed Transaction.

Various assumptions or factors are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking information. Those assumptions and factors are based on information currently available to BSM or Datacom. The material factors and assumptions include: the ability to obtain the necessary director, shareholder and regulatory approvals; Exchange policies not changing; completion of satisfactory due diligence; and the structure of the Proposed Transaction being the most tax efficient way of completing the Proposed Transaction. Risk Factors that could cause actual results or outcomes to differ materially from the results expressed or implied by forward-looking information include, among other things: conditions imposed by the Exchange, the failure to obtain the necessary directors' and shareholders' approval to the Proposed Transaction; changes in tax laws, general economic and business conditions; and changes in the regulatory requirements. BSM cautions the reader that the above list of risk factors is not exhaustive. The forward-looking information contained in this release is made as of the date hereof and BSM is not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, the reader should not place undue reliance on forward-looking information. The foregoing statements expressly qualify any forward-looking information contained herein.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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