HALO Technology Holdings Announces Third Quarter Results

Business Wire, May 24, 2007

GREENWICH, Conn. -- HALO Technology Holdings (OTCBB: HTHO) (the "Company" or "HALO") today announced results for the three and nine months ended March 31, 2007.

For the third quarter of fiscal 2007, the Company reported revenue of $3.9 million versus $2.9 million reported in the third quarter of fiscal 2006. Results for the current quarter reflect the acquisitions of Empagio, Inc, which was acquired January 13, 2006; Executive Consultants, Inc., acquired March 1, 2006; Tenebril, purchased on August 24, 2006; and RevCast, acquired September 15, 2006. For the third quarter of fiscal 2007, the Company posted a loss before interest expense and fair value gain on warrants of $1.5 million, compared with a loss of $1.9 million in the prior year period. In the quarter ended March 31, 2007, HALO reported a net loss attributable to common stockholders of $4.0 million, or $(0.11) per diluted share, versus a net loss of $2.3 million, or $(0.32) per diluted share, for the third quarter of fiscal 2006. The net loss attributable to common stockholders for the third quarter of fiscal 2007 included $3.0 million in gains on warrants compared to a gain of $3.2 million last year. In addition, the Company recently reclassified its Empagio unit as a discontinued operation, reflecting its pending sale; this year's third quarter included a loss from discontinued operations of $2.8 million versus income of approximately $50,000 for the third quarter of fiscal 2006. There were 35.0 million diluted shares outstanding, on average, for the third quarter of fiscal 2007 (excluding convertible preferred stock, options, warrants and other convertible securities) as compared with 7.1 million diluted shares outstanding for the period last year.

For the nine months ended March 31, 2007, the Company posted revenue of $11.1 million, as compared with $5.0 million for the first nine months of fiscal 2006. The Company posted a loss before interest expense and fair value gain on warrants of $4.3 million; for the same period last year, the Company posted a loss before interest expense and fair value gain on warrants of $4.5 million. HALO reported a net loss attributable to common stockholders of $9.8 million, or $(0.31) per diluted share, versus income of $20.3 million, or $0.77 per diluted share, for the same period last year. The nine months of fiscal 2007 included $7.5 million in gains on warrants, compared to $34.9 million for the first nine months of fiscal 2006. These results also include a loss from discontinued operations of $2.2 million, compared with a loss of $1.6 million for the same period in fiscal 2006. There were 31.5 million diluted shares outstanding, on average, for the first three quarters of fiscal 2007 (excluding convertible preferred stock, options, warrants and other convertible securities) as compared with 27.9 million diluted shares outstanding in fiscal 2006 (including 23.2 million convertible preferred stock options, warrants and other convertible securities.)

"This past quarter HALO concentrated on taking all measures necessary to cut costs and monetize assets in order to meet our debt obligations," stated Ron Bienvenu, chairman and chief executive officer. "To that end, we decided to sell Empagio for $16 million and have, in tandem, renegotiated the terms of our agreement with Fortress Credit Corp. to pay down approximately $12.6 million of debt and modify the maturity date from August 2, 2009 to September 28, 2007. We expect the sale of Empagio to close later this month. With our debt structure stabilized, we are now in a position to focus our attention on the Company's core operations and capitalize on attractive demand dynamics for our DAVID, Process, ProfitKey and Kenosia subsidiaries, leading to increased revenue growth and EBITDA expansion for the remainder of this year and into fiscal 2008."

Conference Call

HALO will host a conference call today at 11:00 a.m. Eastern. During the call, Ron Bienvenu, chairman and chief executive officer, and Sue Florentino, senior vice president of operations and finance, will discuss the Company's performance and financial results. The telephone number for the conference call is 800-399-7503.

A live webcast of the call will also be available on the Company's website www.haloholdings.com. To listen to the live call online, please visit the site at least 10 minutes early to register, download and install any necessary audio software. The webcast will be archived on the site, and a telephone replay of the call will be available for seven days beginning at 2:00 PM Eastern time, May 24, at 706-645-9291, using conference ID #1027497.

About HALO Technology Holdings

HALO Technology Holdings, Inc. is a global provider of a diversified range of standards-based enterprise software applications and on-demand solutions. HALO's strategy is to acquire and operate enterprise software companies with a commitment to sustainable growth. HALO portfolio companies focus on customer service, product quality and profitability to build long term customer relationships and ensure customer satisfaction today and into the future. Everyday, thousands of corporations and institutions from across the globe rely on our portfolio companies to deliver high quality, enterprise class software and services. For more information, please see our website at www.haloholdings.com.