March 6, 1997 - RE: Electronics Inc., City of Waterloo & NEXSYS Commtech International Inc. ("NEXSYS") Have Signed A Joint Venture Agreement

MISSISSAUGA, ONTARIO--ZTEST Electronics Inc. (the "Company") is pleased to announce that the City of Waterloo and NEXSYS Commtech International Inc. ("NEXSYS") have signed a Joint Venture Agreement to commence a pilot project in the City of Waterloo for the use of the NEXSYS wireless automated meter-reading device. A copy of the Press Release issued by the City of Waterloo is annexed.

The Company is the single largest shareholder of NEXSYS and is currently finalizing the terms of a manufacturing arrangement with NEXSYS as previously disclosed.



ZTEST Electronics Inc. Mr. Wojciech (Ted) Drzazga President and a director of the Company (905) 238-3543 or ZTEST Electronics Inc. Mr. James E. Lalonde (905) 238-3543



City of Waterloo Joins With Nexsys Commtech In Waterloo Safe- Smart Homes Project

March 3, 1997-The City of Waterloo has signed a joint venture agreement with Nexsys Commtech International Inc. of Waterloo for a project that could save taxpayers money while it makes the city's 23,000 homes and businesses safer, smarter and even more energy efficient.

The Waterloo Safe-Smart Home System will use state-of-the-art, two-way wireless technology to link homes and businesses to a central network. Devices mounted outside each home or business will transmit, via radio, information such as an alarm from a smoke detector directly to a receiver mounted on a nearby streetlight pole, for retransmission to fire stations.

The big advantage of the system is that it will help make Waterloo a safer city, says Mayor Brian Turnbull.

"The sooner a fire alarm is received, the sooner we can respond," he says. "This system can even monitor smoke detectors for dead batteries. There is no doubt that utilizing this wireless technology will eventually save lives and reduce property losses."

"The system will give us a big boost in our efforts to create a safe community," adds Waterloo Fire Chief Max Hussey.

"Fires don't always occur when somebody is at home or at their place of business, and an unconscious person can't call 911. A direct alarm link with the local fire station will allow us to get to an emergency situation much sooner."

The system can also be used to provide instant information on water, electricity and natural gas consumption and rates which can be displayed on your home television screen. Eventually, this could lead to variable-rate utility billing so homeowners could choose to time their consumption (eg., lawn watering, hot water tanks) to take advantage of off-peak rates.

A pilot project will see the Waterloo Safe-Smart System installed in 50 Waterloo households this Spring. This first phase of the pilot project, which will be done at no cost to participating households, will involve testing the software, smoke detection monitors, water and hydro meter reading devices, carbon monoxide monitoring, and an in-home display module.

If that test goes as expected, up to 250 more homes will be involved in the second phase of the pilot project, and if it proves successful, a third phase will involve up to 1,000 homes.

Eventually, customers may have the option of using the system for other uses such as home security, (monitoring burglar alarms) and personal health, (i.e., medical emergencies).

The total cost of the pilot project is estimated at $450,000. Connecting every Waterloo household -- the ultimate goal if everything works as planned -- would cost about $8 million.

Waterloo's Chief Administrative Officer, Tom Stockie, says the system is expected to pay for itself in four years through reduced costs and new revenue.

The City will save money through changes to account billing and the account collection process, and the system will produce long- term revenues from fees charged on such things as burglar alarm, medical emergency and smoke detector monitoring, and possibly from natural gas and electricity billing.

Waterloo North Hydro and Union Gas will be following the project with interest, Stockie adds.

If the system works as planned, it will be marketed across North America and around the world, says Stockie. Under the terms of the agreement with Nexsys, the City will share in the ownership of the technology.

"We have not invested any money in Nexsys," says Stockie, "but as part of the joint venture agreement we will be given an equity position which could eventually provide additional returns to the City."

Donald Hathaway, President and CEO of Nexsys Commtech, says his company has other pilot projects underway or about to start in other cities, "but this is the first major project" that moves beyond monitoring utility meters.

"This," he says of the agreement with the City, "is a blueprint for the way business and government should be working together."

Turnbull says he is delighted to have the City involved in the project.

"It is helping us to build a safe community," he says, "while also boosting local economic development through promoting a leading-edge technology."

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