Nighthawk Systems, Inc. (OTCBB: NIHK Stock Forums), a leading provider of intelligent wireless power management and emergency notification solutions, announced today that it has purchased the IPTV set-top box business assets of Eagle Broadband (OTCBB: EAGB). The purchase is expected to significantly bolster revenues and cash flows at Nighthawk based on existing purchase orders for high-definition MediaPro IP3000HD set-top boxes with a leading hospitality solutions provider. Under terms of the purchase, Nighthawk assumes responsibility for production on a contract under which the customer has forecasted purchases that could generate in excess of $6 million in revenues to Nighthawk over a period of just over one year.

As disclosed in Nighthawk’s Form 8-k filing with the Securities and Exchange Commission last Friday, the assets were purchased for $4.75 million. The transaction was facilitated by a $6 million sale of unregistered Series B Convertible Preferred Stock and Warrants to Dutchess Private Equities Fund, Ltd. Under terms of the sale, the Preferred Stock is not convertible for a period of one year, and is redeemable solely at Nighthawk’s option.

H. Douglas Saathoff, Nighthawk’s Chief Executive Officer, commented, “This is a huge event for Nighthawk Systems. This funding and subsequent acquisition of the set-top box business present Nighthawk with an incredible opportunity to take a quick and large step forward in creating additional value in the Company. Here are some of the near-term benefits that I expect to realize from this transaction:

• Strengthening of our balance sheet through the investment of $6 million and the purchase of the assets. The investment in Nighthawk will result in a return to a positive net equity position for the Company, enhancing our ability to attract larger customers and larger contracts for both traditional Nighthawk control products and set-top boxes.
• Enhanced revenues and cash flows from orders that already exist for the set-top box products, as well as future orders that we expect to receive. Nighthawk receives existing purchase orders that, when completed, will produce revenues in excess of $400,000. Additional orders are also expected, which will supplement Nighthawk’s existing, growing revenue base for control products.
• Lower costs due to higher production volumes. All Nighthawk products, including set-top boxes, utilize printed circuit boards. Higher volume production runs should lead to lower per unit costs.
• Integration of IP-based technology into Nighthawk’s traditional, wireless control products. We acquire an experienced team of hardware and software engineers as part of this transaction.
• Opportunities to sell traditional Nighthawk products into set-top box markets. Set-top boxes are endpoint devices on complex networks that often require the integration of rebooting or power control solutions.

To summarize, I believe that the acquisition of industry-leading technology and existing revenue-generating opportunities, financed by the sale of unregistered equity securities, provides Nighthawk with a significant near-term opportunity to enhance the value of the Company. I believe this acquisition will provide operational and financial synergies for a long time to come.”

About Nighthawk Systems, Inc.

Nighthawk is a leading provider of intelligent wireless power control products that enable simultaneous activation or de-activation of multiple assets or systems on demand. Nighthawk's installed customer base includes major electric utilities, internet service providers and fire departments in over 40 states. Nighthawk's products also enable custom message display, making them ideal for use in traffic control and emergency notification situations.

The MediaPro IP3000HD is a high-definition set-top box with a compact footprint and quiet, fan-less design that delivers exceptional streaming video quality for both NTSC and PAL broadcast standards. Capable of supporting a variety of leading middleware and video-on-demand systems, including Java Script capabilities, the MediaPro IP3000HD platform delivers the advanced content system security and digital rights management (DRM) needed by various industries and markets, most notably the hospitality industry.

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Forward-looking statements

Statements contained in this release, which are not historical facts, including statements about plans and expectations regarding business areas and opportunities, acceptance of new or existing businesses, capital resources and future business or financial results are "forward-looking" statements. You should not place undue reliance on these forward-looking statements. Such forward-looking statements are subject to risks and uncertainties, including, but not limited to, customer acceptance of our products, our ability to raise capital to fund our operations, our ability to develop and protect proprietary technology, government regulation, competition in our industry, general economic conditions and other risk factors which could cause actual results to differ materially from those projected or implied in the forward-looking statements. Although we believe the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made, and our future results, levels of activity, performance or achievements may not meet these expectations. We do not intend to update any of the forward-looking statements after the date of this press release to conform these statements to actual results or to changes in our expectations, except as required by law.

Nighthawk Systems, Inc.
Doug Saathoff, 877-7-NIGHTHAWK, ext. 701
dsaathoff@nighthawksystems.com