September 11, 2017 – Elkhart, Indiana – TekModo Industries Inc. (TSX-V: TEK) (“TekModo” or the “Company”) provides the following operational and corporate update:
The Company is continuing to refine production runs on the GRP manufacturing line, which has now successfully produced initial small-scale SpectraLiteTM samples. Full commissioning of the GRP manufacturing line has been delayed and commercialization was not achieved by August 2017 as anticipated. The delay is a result of hardware and control system modifications that were identified in the commissioning process. TekModo now expects client evaluations to occur in late November 2017. If product testing is successful, then commercial sales of SpectraLiteTM are expected in Q1, 2018.
In order to achieve these objectives TekModo is pleased to announce that Edward Sepulveda has been hired as Vice President of Manufacturing. Mr. Sepulveda has sixteen years of experience as a senior manager, responsible for developing and producing advanced composite products in the defense and aerospace industries. He has received numerous industry awards for his contributions to product innovation within the composites industry. He holds a Bachelor’s degree in Mechanical Engineering from Villanova University with a concentration in Advance Materials and Program Management.
Mr. Sepulveda’s first priority will be to produce SpectraLiteTM samples for client testing followed by bringing the product line to full commercialization.
As reported in the Company’s May 10, 2017 news release, TekModo has upgraded and optimized the large laminator resulting in improved product quality, tighter tolerances and increased throughput speed. As a result of these upgrades, the laminator has operated without interruption since the May 10 announcement.
Other Operational News
- The Roll Coater remains operational and demand continues to be strong for products.
- The Lightweight Foam Panel System samples are being produced and tested by several clients.
- The Shear Line has been delivered, but has not yet been installed.
Marc LaCounte, President of TekModo, commented: “We have faced some challenges with achieving our timelines and are working hard with our team to complete the GRP line and commercialize SpectraLiteTM. We are now focusing on increasing our sales and marketing efforts. In order to achieve this objective, TekModo is expanding its internal and external sales force to market its current and upcoming product lines. The Company continues to develop disruptive composite technologies and several new product introductions are scheduled for the balance of the year.”
The Company’s board of directors has approved a share consolidation on the basis of one new common share for every existing four common shares. After the consolidation, the Company will have approximately 29 million common shares issued and outstanding and Class B Exchangeable shares of TekModo Holdings Inc. exchangeable into approximately 3 million common shares of the Company.
Approximately 68 million warrants granted in connection with the recent rights offering will be consolidated into 17 million warrants exercisable at a price of $0.25. An additional approximate 10 million warrants and stock options will be consolidated into approximately 2.5 million warrants and stock options exercisable at prices ranging from $1.50 to $4.72.
On Behalf of the Board of TekModo Industries Inc.
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Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Notes Regarding Forward-looking Statements
This news release contains certain forward-looking information and forward-looking statements within the meaning of applicable securities legislation (collectively “forward-looking statements”). Certain information contained herein constitutes “forward-looking information” under Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “expects” will”, “intends”, “is expected to” and variations of such words and phrases or statements that certain actions, events or results “will” occur. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed by such forward-looking statements. In particular, the Company’s expectations regarding the completion of the GRP Line, client testing and sales of SpectraLiteTM are forward looking statements. There can be no guarantee that the GRP line will be completed or that SpectraLiteTM sales will be achieved. In addition to the risks associated with manufacturing, the Company will require additional capital to achieve these objectives, which capital, if available, may result in dilution to existing shareholders. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward looking information. The Company does not undertake to update any forward-looking statements or forward-looking information that are incorporated by reference herein, except as required by applicable securities laws.