TORONTO, Feb. 7, 2018 /CNW/ - 01 Communique Laboratory Inc. (ONE:TSX-V) today announced results for its fourth quarter fiscal 2017, which ended October 31, 2017. The Company's loss for the quarter was $13,136 (2016 – $109,756) and for the full fiscal year of 2017 a loss of $24,908 (2016 - $943,927). The adjusted loss for the fourth quarter, which excludes non-cash expenses for stock-based compensation and depreciation, $104 (2016 – $122,333) and for the full fiscal year of 2017 a profit of $73,667 (2016 – loss of $583,482). The Company completed fiscal 2017 with $238,576 of cash and cash equivalents. 

"We remain committed to our plan of continuing operations as we pursue our appeal of the Citrix Systems Inc. ("Citrix") lawsuit until its conclusion," said Andrew Cheung, President and CEO for 01 Communique. "With respect to the appeal with Citrix, we are preparing for a hearing at the United States Court of Appeals for the Federal Circuit on February 8, 2018 after which we expect the Court of Appeals to render their decision on our request for a new trial."  

An Update on the Company's Operations follows:

The Company reduced its operating expenses significantly in January 2016 as it prepared to work through the appeal process in its patent litigation against Citrix. In addition to moving forward with the appeal process the Company continued to work with Hitachi Solutions Create Ltd. as well as make its products available from its web site. Substantially all development work had been completed on the products that the Company licenses and with respect to the appeal process the Company relies on its lawyers and hence minimal internal resources are required. Accordingly the Company was able to significantly reduce its expenses. The Company makes use of third party contractors for the development and support of its products as required.

Revenue for the fourth quarter 2017 was $119,625 (2016 - $8,905) an increase of $110,720. The majority of this increase is due to an increase in royalty revenue received for the Company`s share of revenue received from third parties for the sale of DoMobile in Japan by Hitachi Solutions Create Ltd.

Cash operating expenses, which exclude stock based compensation and depreciation, for the fourth quarter 2017 were $95,266 (2016 - $118,633) a decrease of $23,367.

There were no patent enforcement and re-examination expenses for fiscal year 2017 (2016 – nil). Patent enforcement and re-examination expenses have fluctuated in prior years with the level of activity in respect of the Company's patent litigation and the re-examination requested by Citrix. With respect to the Citrix litigation, expenses have reached a cap and the Company's lawyers are now responsible for such expenses for which they are to be reimbursed out of proceeds of settlement or an award of damages, if any.

Addendum to the Debenture – subsequent to the end of the year on January 31, 2018:

Subsequent to the end of the year, on January 31, 2018, the Company entered into an agreement to amend the terms of its $400,000 principal amount of debentures (the "Debentures") and 800,000 common share purchase warrants (the "Warrants") that were issued on April 24, 2015.

Each Debenture bears interest at a rate of 10% per annum, calculated and payable quarterly. The Debentures had a term of 36 months expiring on April 24, 2018 and were redeemable at any time prior to maturity at the discretion of 01 Communique with payment of an additional three months interest. The Debentures are secured by a general security agreement. Each Warrant is exercisable into one common share in the capital of 01 Communique at any time until April 24, 2018 at an exercise price of $0.21 per Common Share. Under the terms of the amendment the rate of interest on the Debentures increased to 15% effective April 25, 2018 and the maturity date is extended to April 24, 2019.  Furthermore, effective January 31, 2018 the Warrant exercise price is decreased to $0.10 and the expiry date is extended to April 24, 2019.  In addition the amended Warrants provide for an expiry date acceleration clause such that the exercise period of the Warrants will be reduced to 30 days if, for any ten consecutive trading days during the unexpired term of the Warrant (the "Premium Trading Days"), the closing price of the common shares of the Company exceeds the exercise price of the Warrants by 25% or more. The reduced exercise period of 30 days will begin no more than 7 calendar days after the tenth Premium Trading Day.

Background on the Company's patent lawsuit against Citrix:

In February 2006, the Company commenced a lawsuit in the United States District Court, Northern District of Ohio, Eastern Division, against Citrix alleging infringement by their GoToMyPC product line of the Company's patent, United States Patent No. 6,928,479, (" the '479 Patent"). On January 11, 2016 a jury trial commenced in the lawsuit with the jury reaching and returning a unanimous verdict on January 19, 2016. The Court entered Judgment as follows:

1. Defendants Citrix have not infringed claims 24 or 45 of the '479 Patent;

2. Claims 24 and 45 of the '479 Patent are not invalid;

3. Plaintiff 01 Communique takes no damages from Citrix;

4. Except as set forth above or adjudicated through Summary Judgment, all other claims and counterclaims in this matter were dismissed;

5. On March 7, 2016 the Company filed post-trial motions with the District Court that presided over the trial. These included motions for renewed judgment as a matter of law and for a new trial.

6. On March 21, 2017 the District Court issued its order denying the Company's motion for judgment as a matter of law and for a new trial.

7. On March 30, 2017 the Company filed a Notice to Appeal the District Court's Order with the United States Court of Appeals for the Federal Circuit.

8. There is a hearing scheduled at the United States Court of Appeals for the Federal Circuit on February 8, 2018 after which we expect the Court of Appeals to render their decision on our request for a new trial. While the Company is confident in the merits of its appeal there can be no assurance that the Company will be successful in its appeal.

Neither TSX Venture Exchange ("TSX-V") 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.

About 01 Communique

Established in 1992, 01 Communique Laboratory Inc. (TSX-V:ONE) offers a suite of remote access services designed for small-medium sized business, mobile professionals and IT service providers. 01's software as a service offerings are deployed on-demand and include functionality enabling on-line meetings, remote computing and IT support. 01's suite of products includes its remote access offering I'm InTouch (www.imintouch.com), its online meeting offering (www.imintouchmeeting.com) and its remote support offering I'm OnCall (www.imoncall.com) products are protected in the U.S.A. by its patents #6,928,479 / #6,938,076 / #8,234,701 and in  Canada by its patents #2,309,398 / #2,524,039 and Japan by its patent #4,875,094. For more information, visit www.01com.com or call (905) 795-888 or (800) 668-2185 (North America only).

Cautionary Note Regarding Forward-looking Statements.

Certain statements in this news release may constitute "forward-looking" statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this news release, such statements use such words as "may", "will", "expect", "believe", "plan", "intend", "are confident" and other similar terminology. These statements reflect current expectations regarding future events and operating performance and speak only as of the date of this news release.  Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the factors discussed under "Risk and Uncertainties" in the company's Management`s Discussion and Analysis document filed on SEDAR. Although the forward-looking statements contained in this news release are based upon what management of the Company believes are reasonable assumptions, the company cannot assure investors that actual results will be consistent with these forward looking statements. These forward-looking statements are made as of the date of this news release, and the company assumes no obligation to update or revise them to reflect new events or circumstances.

SOURCE 01 Communique Laboratory Inc.

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