Supply Agreement with Fairey Industrial Ceramics

HALOSOURCE SIGNS SUPPLY AGREEMENT WITH UK'S FAIREY INDUSTRIAL CERAMICS LTD

HaloSource, Inc. ("HaloSource" or "the Company") (HAL.LN, HALO.LN) the clean water and antimicrobial technology company, today announces that it has signed a supply agreement with Fairey Industrial Ceramics Limited (FICL), the UK based sole manufacturer of the world-famous range of Doulton®, British Berkefeld® and Fairey® ceramic drinking water filters.

FICL will incorporate HaloSource's revolutionary HaloPure® drinking water disinfection cartridges in a variety of British Berkefeld ceramic filters, proven to both highly effectively filter water and kill a wide range of harmful micro-organisms, producing healthy drinking water.

The first cartridge format has been designed specifically for gravity filter applications and will enhance British Berkefeld gravity filter performance to reduce waterborne viruses as well as bacteria and cysts, thus exceeding WHO standards. One HaloPure-powered British Berkefeld filter element will purify enough water to meet the drinking water needs of a family of five for up to six months.

John Kaestle, Chief Executive of HaloSource commented: "We are very pleased to be working with a company with the heritage and market reach of Fairey Industrial Ceramics Limited. The addition of our HaloPure technology will enhance the performance of FICL's ceramic filters, delivering safer drinking water at an affordable price".

Simeon Gabriel, Sales and Marketing Manager of FICL, commented: "We are very excited to incorporate such a complementary technology and be able to offer new products that are consistent with the high quality and performance our customers around the world have come to expect from British Berkefeld gravity filters".

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About HaloSource

HaloSource is a clean water technology company, headquartered in Seattle, US with operations in India and China. It is focused on the provision of cleaner, clearer and safer water using its proprietary N-halamine bead technology to clean and purify water, killing bacteria and viruses that may cause disease.

While HaloPure provides safer drinking water; SeaKlear and StormKlear products use a second technology based on natural bio-polymers to provide water clarification and antimicrobial applications for treating recreational and environmental water; and HaloShield facilitates the binding of chlorine-based bleach to textiles such as sheets, lab coats and towels.

About HaloSource's Markets

HaloPure products are principally targeted at consumers in emerging market countries, where access to safe drinking water is particularly poor. In an independent analysis of the global Point of Use drinking water device market, Frost and Sullivan concluded that:

·; the market for residential water treatment equipment in China was estimated at $960 million in 2005, growing at an annual rate of 20.4 per cent between 2004 and 2011;

·; the market for residential drinking water devices in India was estimated at $425 million in 2009, and experiencing growth of approximately 25 per cent annually; and

·; in 2005 the global markets for filtration formats in the form of under-the-sink, counter top and replacement cartridges were growing annually at 20 per cent, 21 per cent and 18 per cent, respectively.

The World Health Organisation has estimated that 1.1 billion people lack access to safe drinking water and the Centre for Disease Control is recommending Point Of Use filtration and disinfection.

About Fairey Industrial Ceramics Limited

Fairey Industrial Ceramics Limited (FICL) is the sole manufacturer of the world famous range of Doulton®, British Berkefeld® and Fairey® ceramic drinking water filters. With over 150 years continuous manufacturing experience and with Doulton®, British Berkefeld® and Fairey® filters in use in home water filtration systems in 140 countries worldwide, FICL is a global leader in water purification, helping to provide safe, clean, filtered drinking water to millions of people every day. FICL's customers range from large retailers, OEMs and water cooler companies to aid agencies, wholesale distributors and water treatment professionals. Its drinking water filters have passed the highest international testing standards.