01 Communique Reports Third Quarter Fiscal 2015 Results

TORONTO, Aug. 26, 2015 /CNW/ - 01 Communique Laboratory Inc. (ONE:TSX-V) today announced results for its third quarter fiscal 2015, which ended July 31, 2015. The loss and comprehensive loss for the third quarter 2015 was $345,956 (2014 - $629,744). The adjusted loss, which excludes non-cash expenses for stock-based compensation and depreciation, for the quarter was $297,216 (2014 - $353,469). The Company completed the quarter with $841,437 of cash and cash equivalents.   

"Our main goal for the remainder of this year is to prepare for our patent lawsuit trial against Citrix, scheduled to commence January 8, 2016," said Andrew Cheung, President and CEO for 01 Communique. "Our results reflect our emphasis on this aspect of our business. With respect to the case, on May 18, 2015 we received the inter partes re-examination certificate from the USPTO bringing that part to a successful conclusion and on June 12, 2015 we received the Court's claim construction ruling adopting our construction for the four disputed claim terms. We look forward to our day in court."

An update on the Company's patent lawsuit against Citrix Systems Inc. ("Citrix") follows.  

The Company is protecting its intellectual property against Citrix's GoToMyPC product offering. The Company is seeking damages based upon a reasonable royalty, back to August 2005 the date the patent was issued, for infringement, as well as pre and post judgment interest on awarded damages; treble damages for willful infringement, and attorneys' fees. An overview of recent events and timelines to get to trial follows.

The inter partes re-examination. On October 16, 2014 the United States Court of Appeal for the Federal Circuit rendered their decision affirming the United States Patent and Trademark Office's ("USPTO") Patent Trial and Appeals Board decision that the Company's patent 6,928,479 (" '479 Patent") is valid and then issued their mandate to the USPTO to issue a re-examination certificate. On May 18, 2015 the USPTO issued that inter partes re-examination certificate.

The Markman Order. On June 12, 2015 the Court issued its claim construction order and memorandum ruling on the meaning of four disputed claim terms, adopting the Company's proposed construction for all four claim terms. The Court also agreed with the Company that the preamble to claim 24 of the '479 Patent was not limiting and hence concluded that it was not necessary to construe two additional claim terms contained in the preamble. 

The timetable. Expert discovery was completed on February 27, 2015. A trial is scheduled to commence January 8, 2016. A summary judgment motion schedule is as follows:

  • Opening briefs were filed July 27, 2015.
  • Response briefs along with an opening brief (if elected) due on any issue for which the party does not bear the burden of proof are to be filed by August 27, 2015.
  • Reply and response briefs for the July 27, 2015 and August 27, 2015 briefing respectively to be filed by September 14, 2015.
  • Reply briefs in respect of the issues raised in the August 27, 2015 opening brief by September 28, 2015.

An update on financial results follows.

  1. Operating expenses for third quarter 2015 were $356,229 (2014 - $681,748). Excluding non-cash expenses for stock based compensation of $47,348 (2014 - $189,643) and depreciation of $1,392 (2014 - $1,632), the cash operating expenses to fund the business for the third quarter 2015 were $307,489 (2014 - $490,473), a decrease of $97,984. Much of this decrease is a result of a reduction in compensation related expenses and patent litigation and re-examination costs.

  2. The loss and comprehensive loss for third quarter 2015 was $345,956 (2014 - $629,744). Excluding non-cash expenses for stock-based compensation and depreciation, the adjusted loss for the third quarter 2015 was $297,216 (2014 - $353,469).

  3. There were no patent litigation and re-examination expenses incurred in the third quarter 2015 (2014 -$85,000). These expenses fluctuate with the level of activity in respect of patent litigation as well as the re-examination that had been requested by Citrix and, with the receipt of the re-examination certificate, it is now complete and no further costs are expected. 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.

On August 26, 2015 stock options were granted to members of the Company's executive management and directors. There were 840,000 stock options granted in total expiring on August 26, 2019, with an exercise price of $0.42 and vesting 500,000 on February 26, 2016 and 340,000 on August 26, 2016.

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 achieveme*nts 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 Factors" in the company's Annual Information Form 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.


01 Communique Laboratory Inc.

SELECTED FINANCIAL INFORMATION

Consolidated Statements of Financial Position

Unaudited
















31-July-15




31-Oct-14











Assets










Current assets











Cash and cash equivalents




$

841,437



$

1,370,813


Accounts receivable





79,990




105,551


Prepaid expenses and other assets





52,372




35,938






973,799




1,512,302











Property and equipment





9,588




12,549





$

983,387



$

1,524,851











Liabilities and Shareholders' Equity




















Current liabilities











Accounts payable and accrued liabilities




$

507,309



$

711,679


Deferred revenue





15,464




17,810






522,773




729,489











Liability portion of Debenture





356,351




---











Shareholders' equity











Share capital





40,628,777




40,288,777


Equity portion of Debenture





47,111




---


Contributed surplus





4,909,005




4,878,587


Deficit





(45,480,630)




(44,372,002)






104,263




795,362





$

983,387



$

1,524,851

 


01 Communique Laboratory Inc.

SELECTED FINANCIAL INFORMATION

Consolidated Statements of Operations and Comprehensive Income

For the 3 and 9 month periods ended July 31, 2015 and 2014

Unaudited








for the 3 months ending


for the 9 months ending




31-Jul-15



31-Jul-14



31-Jul-15



31-Jul-14














 Revenue


$

23,018


$

49,355


$

76,311


$

208,943

 Cost of revenue



-



-



-



-




23,018



49,355



76,311



208,943














Expenses (income):













Selling, general and administrative



162,032



418,052



575,728



957,373

Patent litigation & re-examination expenses



-



85,000



6,658



114,696

Research and development



194,197



178,696



590,352



541,175

Interest



(497)



(2,649)



(1,911)



(5,558)




355,732



679,099



1,170,827



1,607,686

Loss before interest and accretion on liability













component of debenture


$

(332,714)


$

(629,744)


$

(1,094,516)


$

(1,398,743)














Interest on debenture



10,000



-



10,650



-

Accretion on liability portion of debenture



3,242



-



3,462



-

Loss for the period and comprehensive loss


$

(345,956)


$

(629,744)


$

(1,108,628)


$

(1,398,743)



























Loss per common share 













Basic


$

(0.01)


$

(0.01)


$

(0.02)


$

(0.02)

Diluted


$

(0.01)


$

(0.01)


$

(0.02)


$

(0.02)














Weighted average number of common shares













Basic



65,795,437



65,743,807



65,761,159



65,607,697

Diluted



65,795,437



65,743,807



65,761,159



65,607,697

 

01 Communique Laboratory Inc.

SELECTED FINANCIAL INFORMATION

Consolidated Statements of Cash Flows

For the 3 and 9 month periods ended July 31, 2015 and 2014

Unaudited











three months ending



nine months ending




31-Jul-15



31-Jul-14



31-Jul-15



31-Jul-14

Cash provided by (used in):


























Operating activities:














Loss for the period


$

(345,956)


$

(629,744)


$

(1,108,628)


$

(1,398,743)


Adjustments to reconcile the loss for the period














to net cash flows from operating activities















Depreciation



1,392



1,632



4,719



5,856



Stock-based compensation



47,348



189,643



165,418



279,793



Accretion on liability portion of debenture



3,242



-



3,462



-



Interest income



(497)



(2,649)



(1,911)



(5,558)


Change in non-cash working capital



7,708



(55,120)



(197,589)



(426,907)




(286,763)



(496,238)



(1,134,529)



(1,545,559)

Interest income received



497



2,649



1,911



5,558




(286,266)



(493,589)



(1,132,618)



(1,540,001)














Financing activities:














Issue of common shares



205,000



-



205,000



75,600


Issue of debenture



-



-



400,000



-

Investing activities:














Purchase of capital assets



(1,017)



-



(1,758)



-

Increase (decrease) in cash



(82,283)



(493,589)



(529,376)



(1,464,401)














Cash and cash equivalents, beginning of period



923,720



2,101,469



1,370,813



3,072,281

Cash and cash equivalents, end of period


$

841,437


$

1,607,880


$

841,437


$

1,607,880

 

SOURCE 01 Communique Laboratory Inc.

For further information: INVESTOR CONTACT: Brian Stringer, Chief Financial Officer, 01 Communique, (905) 795-2888 x204, brian.stringer@01com.com

RELATED LINKS
http://www.01com.com

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