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Regulatory Authorities Approve LAVA Systems Inc.'s Acquisition of UK Software Distributor

Toronto, ON – 1997-9-22 – LAVA Systems Inc. (TSE:LVA), the Canadian-based developer and distributor of information management systems, today announced that the acquisition of SCS Consulting Limited of the United Kingdom has been approved by regulatory authorities. The UK-based software distributor is now a wholly-owned subsidiary of LAVA Systems Inc.

In a related move LAVA Systems Inc. also announced that Robert Terry, formerly Managing Director of SCS Consulting Limited and Brian MacDonald, Senior Vice President and Chief Financial Officer of LAVA, have been appointed to the Board of Directors of LAVA Systems Inc. With the addition of Messieurs. Terry and MacDonald the Board of Directors of LAVA now comprise eight members.

SCS Consulting Limited develops and distributes software products used in financial services and insurance industry operations. SCS's operations have already been combined with LAVA's current UK subsidiary. LAVA will immediately begin distribution of SCS's products through its worldwide partnership network.

SCS Consulting Limited had revenues of 3.6 million UK pounds in the twelve month period ended July 31, 1997 with profit before tax of 1.3 million UK pounds. The amalgamation of SCS with LAVA is expected to contribute approximately 10 cents per share to LAVA's 1997/98 fiscal year earnings per share.