HydraLogic Completes Private Placement of Units



    /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES NOR FOR DISSEMINATION
    IN THE UNITED STATES./

    BARRIE, ON, Sept. 26 /CNW/ - HydraLogic Systems Inc. (HLS:TSX.V) today
announced that on September 21, 2007 it completed a private placement of
8,333,332 units. Each Unit consisted of one common share, 1/2 of a Class G
Common Share purchase warrant and 1/2 of a Class H Common Share purchase    
warrant for total proceeds of $2,499,999.60. Each whole Class G Warrant      
titled the Purchaser to purchase one Common Share at a price of $0.50 for     
a period of 24 months and each whole Class H Warrant entitled the Purchaser   
 to purchase one Common Share at a price of $0.80 for a period of 24 months.
All of the securities issued under the private placement are subject to a
4-month hold process.
    The Company received written consent amounting to greater than 50 percent
of the votes attached to all of the issued and outstanding shares in support
of the entire position to be undertaken by CCM Master Qualified Fund Ltd.
(CCM), an investment fund managed by Coghill Capital (Coghill) of Chicago,
Illinois. This transaction follows the previously announced private placement
of units by the Company to the fund announced on August 20, 2007. CCM's
fulfillment of the two private placements amounts to a position of 13,708,332
units on total proceeds of $4,112,499.60.
    Capstone Investments (CapStone) acted as Agents of the Company, and
Barretto Securities Inc. (Barretto) acted as Finder in this offering. CapStone
and Barretto received a combined commission of 5.5 percent in cash and
2.5 percent in the form of Units of the Company under the same terms and
conditions of the Offering outlined above.
    The Unit offering proceeds are intended to retire the balance of the
bridge loan undertaken by the Company in December, 2006 and to provide working
capital in support of the Company's accelerated growth initiatives into the
new year.
    "The undertaking of our two private placements by CCM adds an important
new institutional fund and an opportunity to increase the Company's presence
within the US investment community" stated Michael Beckley, President and
Chief Executive Officer of HydraLogic. "This new capital is expected to
support accelerated growth and the emergence of our products into new market
segments in 2008."

    About HydraLogic Systems Inc:

    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 turn
key distribution and service models into the multi-billion dollar pest and
odour control industries as Bug DeFence and HLS Ecolo respectively. HydraLogic
Systems is traded on the TSX Venture exchange - symbol: HLS.

    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 TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this news release.

    %SEDAR: 00020350E




For further information:

For further information: Glen Akselrod, Bristol Capital Ltd., (905)
326-1888, glen@bristolir.com

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