Pulse Data Inc. rejects Quantum Yield offer



    TSX: PSD

    CALGARY, June 25 /CNW/ - The Board of Directors of Pulse Data Inc.
("Pulse" or the "Company") has reviewed and considered the offer of Quantum
Yield Inc. ("Quantum") dated June 19, 2007 to acquire all of the common shares
of Pulse in exchange for one debenture of Quantum with a principal amount of
$3.05 and a nominal 10 percent interest rate per common share of Pulse.
    The Board of Directors of Pulse unanimously recommends that shareholders
reject the offer and not tender their shares of Pulse to the offer. In the
opinion of the Board, the value of the offer is significantly below the value
of Pulse's shares.
    In addition, Pulse announces that it is making an application to the
Alberta Securities Commission (ASC) for an order to cease-trade the offer due
to incomplete and misleading disclosure to Pulse shareholders. In the opinion
of the Pulse Board of Directors, Pulse shareholders should, at a minimum,
delay making a decision in respect of the offer until after the hearing.

    
    REASONS FOR REJECTING THE OFFER:

    Important reasons for rejecting the offer are as follows:

    -  The offer is a 100 percent leveraged buy-out, by an issuer and
       management with no material assets, no discernible positive credit
       history and no track record in the seismic business, using Pulse's own
       assets as security and with Pulse shareholders providing "100 percent
       vendor take-back financing." Pulse shareholders would continue to have
       all of the risks of the ongoing business with no influence over
       Company operations, while Quantum would gain exposure to all of the
       upside.

    -  Quantum's statements that the offer represents a premium to the
       trading price of the Pulse shares has no foundation. No calculable
       premium is being offered, because there is no market for the
       debentures in order to assess their price. Quantum's statements that
       the debentures represent a premium to Pulse's book value are
       irrelevant and misleading.

    -  Pulse currently has approximately $36 million outstanding in a secured
       term loan. Under the term loan agreement, a change of control of Pulse
       without the lender's prior consent is an event of default which
       entitles the lender to accelerate the debt, demand repayment and
       realize upon their security. It is unknown what the position of
       Pulse's lender would be to a highly leveraged acquisition of Pulse.
       Should the lender demand repayment, Quantum has no funds or disclosed
       plan on how to repay this debt.

    -  To use the free cash flow of Pulse in order to pay interest on the
       debentures, Quantum indicates that it intends to amalgamate with
       Pulse. Pulse's loan agreements restrict amalgamations without the
       lenders' prior written consent. It is unknown what the position of
       Pulse's lenders would be to an amalgamation, and Quantum has no
       disclosed plan to replace or repay the loan.

    -  The description of the debentures is highly misleading:
       -  The debentures are described as 10 percent debentures. In fact, the
          interest payable under the debentures is not fixed at 10 percent
          but is variable based upon the free cash flow of Pulse, with a cap
          of 10 percent and with a right to defer any unpaid portion below
          the cap;
       -  The debentures are described as having security over all of the
          assets of Pulse. In fact, the debentures cannot be secured with
          those assets, since Pulse has already granted security over all of
          its assets to its existing lenders; and
       -  The debentures are described as retractable. In fact, the
          debentures may not be retracted by the shareholders, but the
          debentures may be redeemed by Quantum at any time without bonus or
          penalty.

    -  Quantum is highly leveraged. It is a 100 percent debt-financed
       start-up company, with no shareholders' equity, no revenues and no
       assets.

    -  Pulse shareholders would exchange a liquid, listed, dividend-paying
       common share for an illiquid unrated debt security. Pulse has paid
       16 consecutive quarterly dividends including two increases to the
       quarterly dividend rate per share and currently pays an annual
       dividend of $0.15 per common share.

    -  There is no tax-free rollover. Pulse shareholders may have to try to
       sell an illiquid debt security in order to pay taxes on the exchange
       of their shares.
    

    Shareholders are encouraged to read the more detailed explanation of
    reasons for the Board of Directors of Pulse rejecting the offer attached
    to this news release.

    SIGNIFICANT SHAREHOLDERS NOT TENDERING TO THE OFFER:
    ----------------------------------------------------

    To date, significant institutional shareholders and the directors and
officers of Pulse, representing in total more than 50 percent of the
outstanding shares of Pulse (calculated on a diluted basis), have indicated to
Pulse that they will not be tendering their shares to the offer. The offer is
conditional upon at least 66-2/3 percent of the outstanding shares (calculated
on a diluted basis) being deposited to the offer. Pulse expects that this
condition will not be met.

    APPLICATION TO THE ALBERTA SECURITIES COMMISSION:
    -------------------------------------------------

    The Board of Directors of Pulse has been advised by external legal
counsel that the offer contains serious deficiencies under applicable
securities laws, resulting in incomplete and misleading disclosure to Pulse
shareholders. Pulse is making an application to the ASC for an order to
cease-trade the offer. The date for the hearing of this application has not
been set. Pulse recommends that, at a minimum, shareholders delay making any
decision in respect of the offer until after the hearing.

    BUSINESS PLAN AND CORPORATE UPDATE:
    -----------------------------------

    The Board of Directors and management of Pulse are committed to a
business plan focussed solely on the seismic data library business. The
Company is well-positioned in this business with an experienced management
team, a top-performing sales force and an excellent reputation within the oil
and gas industry. Our long-life seismic data assets, which are very difficult
and expensive to replicate, generate attractive cash margins and free cash
flow. Furthermore, management sees strong opportunities for growing the
seismic data library through both strategic, high-quality seismic data
acquisitions and participation surveys to acquire new data. In that regard,
Pulse is continually pursuing and reviewing data acquisition opportunities. In
addition, Pulse will commence a significant 3D seismic participation survey in
July in the Deep Basin area of west-central Alberta comprising approximately
150 square kilometres of 3D data. Pulse expects to obtain at least 65 percent
pre-funding for this survey with delivery of the data to the participants by
the end of Q3 2007.
    As previously announced on March 5, 2007 the process for the disposition
of Pulse's Terrapoint business unit is continuing on schedule. There has been
significant industry interest in Terrapoint. Confidentiality agreements have
been executed with 14 interested potential purchasers who are reviewing
Terrapoint's information and conducting due diligence. Under the schedule,
initial expressions of interest will be solicited early in Q3 2007, and the
disposition of Terrapoint is targeted for completion by the end of Q3 2007.
    Upon completion of the Terrapoint disposition, Pulse will have a total of
approximately 25 employees and expects to achieve a significant reduction in
general and administrative expenses. Pulse can continue to grow the seismic
business without any significant increase in the number of employees or
general and administrative expenses for the foreseeable future.

    GEORGESON:
    ----------

    Pulse has engaged Georgeson Shareholder Communications Canada Inc. to act
as information agent on behalf of Pulse, to assist Pulse in informing
shareholders as to the views of the Board regarding the Quantum offer.
Shareholders of Pulse should contact Georgeson if they have any questions
regarding the offer at:

    
               Georgeson Shareholder Communications Canada Inc.
                            100 University Avenue
                           11th Floor, South Tower
                               Toronto, Ontario
                                   M5J 2Y1

               North American Toll Free Number 1-888-605-7616
    

    DIRECTORS' CIRCULAR:
    --------------------

    Pulse believes that as a result of the material disclosure deficiencies
in the Quantum offer, it is unable to fully address all of the inadequacies
and risks associated with the offer. Accordingly, Pulse is applying to
cease-trade the offer, as noted above. Subject to the ruling of the ASC, Pulse
will in due course mail to the shareholders its Directors' Circular in
response to the offer, in accordance with applicable securities laws. Pulse
recommends that shareholders not make a decision in respect of the offer until
such time as the Directors' Circular has been received and considered by them.

    Disclaimer: Certain information contained herein may constitute
forward-looking statements under applicable securities laws. Such statements
are subject to known or unknown risks and uncertainties that may cause actual
results to differ materially from those anticipated or implied in the
forward-looking statements. Investors are encouraged to review the "Risk
Factors" section of the Management's Discussion and Analysis in the Company's
most recent Annual Report and interim reports for a discussion of risks that
could affect the Company's operations and financial results. Forward-looking
statements are based upon management's assumptions, expectations and estimates
at the time that such statements are made. Pulse does not update
forward-looking statements should circumstances change or management's
assumptions, expectations or estimates change, unless required by law.

    
               ATTACHMENT TO PULSE DATA INC. PRESS RELEASE OF
                                JUNE 25, 2007

             DETAILED EXPLANATION OF REASONS FOR PULSE REJECTION
                                     OF
                             QUANTUM YIELD OFFER
                             -------------------
    

    The Board of Directors of Pulse Data Inc. ("Pulse" or the "Company") has
reviewed and considered the offer of Quantum Yield Inc. ("Quantum") dated
June 19, 2007 to acquire all of the common shares of Pulse in exchange for one
debenture of Quantum with a principal amount of $3.05 and a nominal 10 percent
of interest rate per common share of Pulse. The Board of Directors of Pulse
unanimously recommends that shareholders reject the offer and not tender their
shares of Pulse to the offer.

    
    Important reasons for the Board's recommendation are as follows:

    1)  In the opinion of the Board, the $3.05 nominal amount of the offer is
        significantly below the value of the Pulse shares in a change of
        control transaction. In particular, the $3.05 nominal amount does not
        adequately take into account the significant free cash flow per share
        generated by the seismic data operations of Pulse, or the fact that
        upon completion of the announced disposition process for the
        Terrapoint business, free cash flow from the seismic data operations
        will not continue to support those operations.

    2)  In the opinion of the Board, the paper consideration offered in the
        form of the debenture is extremely risky and has an intrinsic value
        considerably below $3.05 per share for reasons including the
        following:

        -  The offer is a 100 percent leveraged buy-out, using Pulse's own
           assets as security and with Pulse shareholders providing
           "100 percent vendor take-back financing." Quantum is adding no
           asset value. Pulse shareholders would continue to have all of the
           risks of the ongoing business with no influence over operations,
           while Quantum would have access to all of the upside;

        -  Quantum's statements that the offer represents a premium to the
           trading price of the Pulse shares has no foundation. No calculable
           premium is being offered, because there is no market for the
           debentures in order to assess their price. Quantum's statements
           that the debentures represent a premium to Pulse's book value are
           irrelevant and misleading;

        -  Quantum and its management have no discernible positive credit
           history or track record in the seismic business;

        -  The debentures have not been rated by any rating agency;

        -  Quantum is 100 percent debt-financed. It has no material
           shareholders' equity ($90.00 on its balance sheet) and no equity
           is added as a result of the offer. Quantum plans to issue further
           debt of up to $155 million in connection with the offer;

        -  An acquisition of control of Pulse by Quantum without the consent
           of Pulse's lenders is an event of default under Pulse's
           outstanding term loan in the principal amount of approximately
           $36 million. It is unknown whether Pulse's existing lender would
           be prepared to continue the loan on the same terms in such a
           highly leveraged structure. Quantum's Circular does not disclose
           any plan to replace this indebtedness or to handle this repayment
           which, if not made, could put Pulse into receivership or
           bankruptcy and seriously impair the value of the shares of Pulse
           then held by Quantum and the ability of Quantum to pay interest on
           the debentures;

        -  To use the free cash flow of Pulse in order to pay interest on the
           debentures, Quantum indicates that it intends to amalgamate with
           Pulse. Pulse's loan agreements restrict amalgamations without the
           lenders' prior written consent. Again, it is unknown what the
           position of Pulse's lenders would be to an amalgamation, and
           Quantum has no disclosed plan to repay or replace the loans;

        -  The pro forma income statement contained in Quantum's Circular has
           not adjusted interest expense to provide for any interest on the
           debentures, nor has it increased depreciation as a result of
           Quantum writing-up the value of the assets of Pulse by
           approximately $110 million in conjunction with the offer. The
           pro forma income statement includes the one-time, non-recurring
           writedown of some of Terrapoint's assets in 2006 of $5.6 million
           after tax. Based on the information in respect of Quantum
           contained in its offer circular, Pulse calculates that the correct
           pro forma loss is approximately $27.7 million, which is
           considerably greater than the $3.3 million pro forma loss
           disclosed in the offer circular;

        -  The offer circular does not provide a calculation of earnings
           coverage with respect to the debentures. Pulse calculates that the
           pro forma earnings coverage for interest on borrowed indebtedness
           including the debentures is negative, with a deficiency in
           pro forma earnings coverage of approximately $27.7 million before
           payment of the interest of $17.3 million on existing Pulse
           indebtedness and on the debentures offered to shareholders and
           before income taxes;

        -  Quantum is a start-up company, has no revenue to date, has just
           recently acquired a 10-year licence for certain technology in
           exchange for a $5 million fee with the first $500,000 due in
           December 2007, has borrowed $200,000 which is repayable with
           interest in December 2007 and appears to have borrowed further
           funds to pay for the costs of the offer which it estimated to be
           $650,000. The aforementioned technology appears to come from an
           associated company which has owned it for six years. No
           information is given as to how Quantum intends to develop its
           business relating to the licensed technology, other than through
           Pulse and there is no assurance that the licensed technology will
           be of any incremental value to Pulse's seismic data business. It
           is not clear how Quantum can pay the licence fee or its
           indebtedness (except with Pulse's money); and

        -  As the terms of the debentures provide that "free cash flow" must
           be first applied to pay current and accrued interest on the
           debentures, if there is limited or insufficient free cash flow, it
           is not clear how Quantum will be able to finance the growth of the
           seismic data business.

    3)  The terms of the debentures are unattractive as stated and misleading
        and unclear in many significant respects, including the following:

        -  The designation of the debentures as "10 percent secured,
           retractable debentures" is highly misleading as the debentures do
           not have a 10 percent fixed yield, are not retractable, and cannot
           be secured with the assets of Pulse;

        -  The interest of 10 percent is not a fixed rate but is a cap on
           interest paid. The debentures are a participating debt instrument
           with variable interest paid depending on free cash flow subject to
           a cap of 10 percent. The calculation of free cash flow and exactly
           how this works is unclear;

        -  There is no compound interest payable on deferred or unpaid
           interest on the debentures;

        -  Pulse shareholders will give up the potential upside in Pulse's
           business, including the potential for increases in the dividend
           and, as the only assets underlying the debentures are Pulse's
           assets, remain exposed to the downside risk in Pulse's business;

        -  The debentures are not retractable at the option of the holder of
           the debenture (as described above), but are redeemable at any time
           at the option of Quantum. If Quantum's future financial
           performance was strong, the debentures could be redeemed early.
           The offer circular does not specify the redemption price;

        -  With the non-material shareholders' equity in Quantum, the Quantum
           shareholders have all the upside and the debenture-holders have
           virtually all of the risk;

        -  As mentioned above, all of the assets of Pulse are currently
           subject to security in favour of Pulse's current lenders, and are
           not available to provide security for the debentures;

        -  Pulse's shareholders have voting rights as shareholders in Pulse,
           but as debenture-holders to Quantum they would not have any voting
           rights in Quantum;

        -  The debentures are subordinate to senior indebtedness, but no
           definition is given for senior indebtedness, and the terms of
           subordination are not described;

        -  The events of default under the debentures are not described; and

        -  The covenants and negative covenants of Quantum under the
           debentures are not described.

    4)  The debentures would be illiquid. There would be no market for the
        resale of the debentures and the debentures are not freely tradeable
        under Canadian securities laws. Sellers of the debentures would need
        to use a prospectus or privately place the securities using an
        exemption from the prospectus requirements. There is no assurance
        that a listing could be obtained or that a market would develop.

    5)  There would be limited financial and other continuous disclosure
        information available to debenture-holders regarding Quantum and
        Pulse. Quantum is not a reporting issuer and Quantum plans to cause
        Pulse to cease to be a reporting issuer.

    6)  There is no tax-free rollover for tax purposes under the offer. The
        sale of Pulse shares for Quantum debentures is a taxable transaction
        for Canadian and United States residents, but shareholders would not
        receive any cash to pay their taxes and the debentures would be an
        illiquid security. Canadian residents may be required to pay taxes on
        accrued, deferred interest on the debentures even though the interest
        had not been paid to them.

    7)  The offer provides that Quantum is entitled to all dividends paid
        after the date of the offer, and this would include the dividend paid
        on June 20 by Pulse to shareholders of record on June 6. It may be
        the case that shareholders would have to pay the dividend to Quantum
        and, accordingly, any assessment of the value of the offer should
        reduce the value by $0.0375 per share.
    

    Having carefully considered the Quantum offer circular, having sought
outside legal advice, and having developed the aforementioned analysis
concerning the deficiencies of the Quantum offer, the Board of Directors of
Pulse unanimously determined on June 22, 2007 to reject the offer and to urge
the shareholders of Pulse not to tender their shares to the offer.





For further information:

For further information: please contact: Douglas Cutts, Member of the
Board of Directors, President and C.E.O., Pulse Data Inc., Tel: (403)
237-5559, Toll-free: 1-877-460-5559, E-mail: info@pulsedatainc.com.; Please
visit our website at www.pulsedatainc.com

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Pulse Seismic Inc.

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