- Photon Control acquires all ownership of products, names,
trademarks and intellectual property
- Transfer of research, product development and customer
service employees to Photon Control
- Settlement removes uncertainty for Photon Control
customers
- Transaction to close April 14,
2017
BURNABY, BC, April 10, 2017 /CNW/ - Photon Control Inc.
("Photon Control" or the "Company") (TSX-V: PHO), a leading
developer of optical measurement technologies primarily used in the
semiconductor equipment industry, has executed a definitive binding
agreement to settle its outstanding litigation with Photon Control
R&D Ltd. and certain others (collectively "R&D"), as well
as the counter-claims filed by R&D against the Company.
In addition, as part of the agreement, the Company acquires certain
inventory and equipment from of R&D, and hires employees of
R&D.
With the closing of the settlement:
- Photon Control will acquire full ownership of all intellectual
property, products, trademarks and other assets previously under
dispute, and currently owned by R&D
- R&D employees will be transferred to and hired by Photon
Control
- The Company will pay 4.25% of certain of its revenues to the
former R&D ownership commencing January
1, 2017 for a period of five years. This arrangement
reduces the royalty rate currently paid by the Company by more than
50% and decreases the term of the previous agreements by five
years
- Both parties will settle all outstanding legal disputes at
closing
- R&D and its principals agree to non-competition
arrangements with the Company
"With this settlement our entire newly-combined organization
under CEO Scott Edmonds will focus
solely on creating shareholder value by completely serving the
growing needs of our expanding customer base," said Neil McDonnell, Photon Control's Chair of the
Board. "This agreement also provides our valued customers with much
needed assurance and stability and at the same time adds a strong
cohort of talented industry experts to our research and product
development teams. We would like to thank Chris and Mike Weston and David Dueck for the many contributions they have
made to the success of the Company since 2008. In particular,
Mr. Dueck's conduct throughout this process belies any negative
comments previously made by others regarding his character."
About Photon Control Inc.
Photon Control Inc. designs, manufactures and distributes a wide
range of optical sensors & instruments to measure temperature,
pressure, position, and flow. These products are used by original
equipment manufacturers (OEM) as well as end-users in the
Semiconductor, Oil and Gas, Power, Life Science, and Manufacturing
industries. Photon Control's products provide high accuracy and
reliability in extreme conditions and are supported by a team of
experts that offer onsite installation, training, and support.
Photon Control Inc. also provides engineering services for
customized optical measurement systems. Headquartered in an ISO
9001:2008 manufacturing facility in Burnaby, BC, Photon Control Inc. is listed on
the TSX Venture Exchange, trading under the symbol ''PHO." For
additional information about the company, please visit
www.photon-control.com/investorrelations.html.
Forward-Looking Statements
This News
Release contains "forward-looking statements" within the meaning of
applicable Canadian securities legislation. Such forward-looking
statements concern the business and anticipated financial
performance of the Company and include, without limitation,
statements with respect to the unauthorized transfer of funds to
Photon R&D; statements with respect to the Claim; further
investigations and conclusions of the Independent Committee;
additional controls and measures to be taken by the Company; the
conclusions to be received from the forensic accounting audit and
the IP audit; and the Company's objectives, goals, liquidity,
sources of capital, expectations of sales and continued development
of technologies and products.
These forward-looking statements are based on certain factors
and assumptions, including, without limitation, the Company's
ability to successfully transition management and board
transitions; the results of the forensic accounting audit and the
IP audit; the Company's evidence forming the basis of the Claim and
its financial and management resources and ability to pursue the
Claim; the Company's ability to successfully complete new purchase
orders along the timelines expected; continued and future demand
for the Company's products; continued sales to the Company's major
customers; the continued financial health of the semiconductor
industry; and the Company's ability to continue and further enhance
revenue diversification and open new market opportunities.
Forward-looking statements are subject to a variety of known
and unknown risks, uncertainties and other factors which could
cause actual events or results to differ from those expressed or
implied by the forward-looking statements, including, without
limitation, the Company may face legal action as a result of the
unauthorized transfer of funds to Photon R&D or arising
from the matters that are the subject of the Claim; the Company may
not be successful in obtaining the relief sought in the Claim and,
therefore, may not have all of the intellectual property rights and
goodwill that it believes that it has and should have; additional
measures and controls may not be implemented as expected or along
the timelines anticipated; uncertainties as to the results of the
forensic accounting audit and the IP audit; uncertainties in the
availability and cost of financing for the Company to enable the
Company to achieve its goals; uncertainties relating to the market
for the Company's products and maintaining a stable level of
orders; fluctuations in revenue as a result of volatility in the
markets and product mix; risks relating to the Company's present
reliance on four major customers for the majority of its sales;
risks relating to the Company's reliance on the financial health of
the semiconductor industry; risks relating to the development of
competing technologies and the possibility of increased
competition; the effect of slow growth in the United States, the Company's principal
market, as well as in Canada and
other economies generally and other economic trends and conditions
in the markets that the Company and its customers serve; risks
associated with technical difficulties or delays in product
introductions, improvements, implementation; uncertainties in
product pricing or other initiatives of the Company and its
competitors; uncertainties in factors that may result in a
reduction in capital expenditures and/or delayed buying decisions
affecting demand for the Company's products; risks relating to
currency fluctuations, particularly between the Canadian and
United States dollars; and risks
in pursuing additional development projects to support existing
customers or pursue other business opportunities.
The foregoing assumptions, risks and uncertainties are not
exhaustive of the items that may affect our forward-looking
statements. Should underlying assumptions prove to be incorrect or
one or more of these risks and uncertainties materialize, actual
results may vary materially from those described in the
forward-looking statements. The Company's forward-looking
statements are based on beliefs, expectations and opinions of
management on the date the statements are made. For the reasons set
forth above, readers should not place undue reliance on
forward-looking statements. The Company undertakes no obligation to
update or revise any forward-looking statements included herein if
these beliefs, estimates and opinions or other circumstances should
change, except as otherwise required by applicable
law.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Photon Control Inc.