Toronto Stock Exchange Symbol: SXC

SYSTEMS XCELLENCE ANNOUNCES PRICING FOR EQUITY OFFERING RELATED TO THE ACQUISITION OF HEALTH BUSINESS SYSTEMS

THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

MILTON, Ontario December 7, 2004, Systems Xcellence Inc., ("SXC") (TSX: SXC) today announced the pricing of its planned equity offering (the "Offering") referred to in its press release of November 22, 2004 regarding its acquisition (the "Acquisition") of Health Business Systems, Inc. ("HBS"), a leading provider of retail pharmacy management systems and workflow technology.

The Offering, which is expected to close on or about December 15, 2004, will consist of a private placement of a maximum of 11,111,111 special warrants to be sold to investors in Canada, the U.S. and elsewhere pursuant to prospectus and registration exemptions. The special warrants will be issued at a price of Cdn.$1.35 per special warrant for maximum gross proceeds of Cdn.$15,000,000. Each special warrant will be exercisable into one common share of SXC (a "Common Share"), without the payment of any additional consideration, at any time prior to 5:00 p.m. (Toronto time) on the earlier to occur of: (i) February 28, 2005; and (ii) the third business day after the date of completion of the Acquisition.

The gross proceeds of the Offering will be held in escrow pending completion of the Acquisition. If the Acquisition is not completed by 5:00 p.m. (Toronto time) on January 31, 2005 or such later date, not to exceed 10 days thereafter, as SXC and Paradigm Capital Inc. (as lead agent for the Offering) may agree, each holder of special warrants can elect either to exercise such special warrants or to have such special warrants repurchased at the original issue price plus accrued interest, if any. If the Acquisition is not completed , SXC shall have the option to elect to repurchase all outstanding special warrants for the issue price thereof plus accrued interest and in the event that the holder exercises a special warrant prior to the time that SXC exercises its repurchase right, SXC's exercise of such right shall prevail.
Paradigm Capital Inc. has agreed to act as sole lead agent for the Offering and has formed a syndicate that includes McFarlane Gordon Inc., Clarus Securities Inc., Dlouhy Merchant Group Inc., Northern Securities Inc. and Research Capital Inc.

About Systems Xcellence Inc.

Systems Xcellence (SXC) is headquartered in Milton, Ontario with offices and processing centres in Lombard, Illinois, Scottsdale, Arizona and Victoria, British Columbia. SXC is a leading provider of healthcare information technology solutions and services to the healthcare benefits management industry. The company's product offerings and solutions combine a wide range of software applications, application service provider (ASP) processing services and professional services, designed for many of the largest organizations in the pharmaceutical supply chain, such as pharmacy benefit managers, managed care organizations, retail pharmacy chains and other healthcare intermediaries. SXC can be found on the Internet at www.sxc.com.

PDF FORMAT FOR PRINTING

Back to Press Releases 2004

For more information, please contact: