01 Communique Announces its First Quarter Fiscal 2018 Results

TORONTO, March 15, 2018 /CNW/ - 01 Communique Laboratory Inc. (ONE:TSX-V) today announced results for its first quarter fiscal 2018, which ended January 31, 2018. The Company's loss for the quarter was $44,537 (2017 – $97,763). The adjusted loss for the first quarter, which excludes non-cash expenses for stock-based compensation and depreciation, was $38,179 (2017 – $44,174). The Company completed the quarter with $175,319 of cash and cash equivalents.

"We remain committed to our plan of continuing operations while 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, a hearing took place at the United States Court of Appeals for the Federal Circuit on February 8, 2018. We are now waiting for 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 first quarter 2018 was $34,844 (2017 - $7,631) an increase of $27,213. 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 first quarter 2018 were $51,883 which is fairly consistent with first quarter 2017 of $37,762 an increase of $14,121.

There were no patent enforcement and re-examination expenses for the first quarter 2018 (2017 – 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.

As previously announced, 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. Before the amendment the Debentures bore interest at a rate of 10% per annum, had a term of 36 months expiring on April 24, 2018 and the Warrants were 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.

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 was a hearing that took place at the United States Court of Appeals for the Federal Circuit on February 8, 2018. We are now waiting for 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.