$QUES NEWS ~ Quest Solution Announces Change to Management, Streamlined Capital Structure
Founder and President, Kurt Thomet Resigns; Company Assigns License Agreements, Reduces Near-Term Debt to Strengthen Balance Sheet
HENDERSON, NV -- (Marketwired) -- 09/03/15 -- Quest Solution, Inc., the "Company" (OTCQB: QUES), a leading provider in the technology, software, and mobile data collection systems business, today announced that Kurt Thomet has resigned as President of the Company, effective August 26, 2015, to pursue other ventures and to further his involvement as an active participant and board member of News Beat Social, a one-minute video news media company based in Portland, Oregon. Mr. Thomet founded Quest Marketing, Inc., the Company's wholly-owned subsidiary acquired in 2014, in 1993, and has served as President of the Company since 2014. Tom Miller, the Company's Chairman of the Board of Directors and Chief Executive Officer will assume the role of President of the Company effective immediately.
"I am extremely thankful for the many years of exciting growth that employees and vendors of Quest Solution have shared with me," said Mr. Thomet. "Quest Solution is a great company with loyal customers, outstanding employees and strong growth prospects. I am confident in the public company experience of Tom Miller and the sales talent of George Zicman to guide the Company through the successful integration of both current and future acquisitions as they strive to create superior returns for stockholders and an exciting workplace for our industry leading staff."
"We are very grateful to Kurt for his hard work, vision and commitment to our Company," said Mr. Miller. "Kurt helped build a strong leadership team and a winning corporate culture. He was a part of a team that helped create a Company that is working every day to build scale and achieve operational excellence as we service customers in some of the fastest growing industries of our economy. Concurrent with Kurt's departure, we are pleased to announce the following financial developments; each of which serve to improve our balance sheet, continue our focus on an 'asset-light' business model, reduce interest expense, and simplify our capital structure."
Balance Sheet and Capital Structure Improvement In connection with Mr. Thomet's resignation and in exchange for $1.15 million of value against debts owed to Mr. Thomet, the Company assigned its rights to certain technology licenses and associated intellectual property acquired by the Company from Rampart Detection Systems under an existing Technology License Agreement. Mr. Thomet's intent is to form global partnerships to commercialize technologies for mining, gun barrel detection, cell phone detection, airframe inspection and rebar inspection. As part of the assignment of these licenses, the Company will receive a five-year royalty fee of 3.5% of revenue related to the gun-barrel, rebar inspection and air frame licenses. The Company applied the $1.15 million in proceeds to reduce near-term debt owed to Mr. Thomet.
The Company will also be settling the balance of the two promissory notes issued to Mr. Thomet, the outstanding balance of which is approximately $9.63M, by September 30, 2015 for $5.886 million in cash as well as the $1.15M paid relative to the Rampart licenses as described above. The Company has further agreed to purchase 900,000 shares of Mr. Thomet's common stock no later than December 31, 2015 at a price of at $0.38 per share. Additionally, Mr. Thomet terminated 5,600,000 unexercised warrants to purchase Company common stock under two separate agreements and accepted the termination of his Consulting Agreement with the Company and associated 1,500,000 shares of restricted common stock. The effect of the stock buyback and cancellation of unexercised warrants on the Company's weighted average fully diluted shares is a net 2.4M share reduction, based on the amount reported in our Form 10Q as of June 30, 2015.
Given the debt settlement, the income statement impacts from these changes would include:
Cash interest expense per quarter savings of approximately $47,500,
Non-cash OID interest expense savings per quarter of approximately $138,000
These amounts are based on the historical cash and non-cash interest expenses the company incurred.
"We are excited about this settlement agreement because in addition to providing Mr. Thomet good value, it provides financial flexibility for the company to pursue further growth opportunities, at a more rapid pace than previous," Miller added.
A more detailed description of Mr. Thomet's resignation and the related settlement transaction is available in the Company's corresponding report being filed with the Securities and Exchange Commission on Form 8-K.
Founder and President, Kurt Thomet Resigns; Company Assigns License Agreements, Reduces Near-Term Debt to Strengthen Balance Sheet
HENDERSON, NV -- (Marketwired) -- 09/03/15 -- Quest Solution, Inc., the "Company" (OTCQB: QUES), a leading provider in the technology, software, and mobile data collection systems business, today announced that Kurt Thomet has resigned as President of the Company, effective August 26, 2015, to pursue other ventures and to further his involvement as an active participant and board member of News Beat Social, a one-minute video news media company based in Portland, Oregon. Mr. Thomet founded Quest Marketing, Inc., the Company's wholly-owned subsidiary acquired in 2014, in 1993, and has served as President of the Company since 2014. Tom Miller, the Company's Chairman of the Board of Directors and Chief Executive Officer will assume the role of President of the Company effective immediately.
"I am extremely thankful for the many years of exciting growth that employees and vendors of Quest Solution have shared with me," said Mr. Thomet. "Quest Solution is a great company with loyal customers, outstanding employees and strong growth prospects. I am confident in the public company experience of Tom Miller and the sales talent of George Zicman to guide the Company through the successful integration of both current and future acquisitions as they strive to create superior returns for stockholders and an exciting workplace for our industry leading staff."
"We are very grateful to Kurt for his hard work, vision and commitment to our Company," said Mr. Miller. "Kurt helped build a strong leadership team and a winning corporate culture. He was a part of a team that helped create a Company that is working every day to build scale and achieve operational excellence as we service customers in some of the fastest growing industries of our economy. Concurrent with Kurt's departure, we are pleased to announce the following financial developments; each of which serve to improve our balance sheet, continue our focus on an 'asset-light' business model, reduce interest expense, and simplify our capital structure."
Balance Sheet and Capital Structure Improvement In connection with Mr. Thomet's resignation and in exchange for $1.15 million of value against debts owed to Mr. Thomet, the Company assigned its rights to certain technology licenses and associated intellectual property acquired by the Company from Rampart Detection Systems under an existing Technology License Agreement. Mr. Thomet's intent is to form global partnerships to commercialize technologies for mining, gun barrel detection, cell phone detection, airframe inspection and rebar inspection. As part of the assignment of these licenses, the Company will receive a five-year royalty fee of 3.5% of revenue related to the gun-barrel, rebar inspection and air frame licenses. The Company applied the $1.15 million in proceeds to reduce near-term debt owed to Mr. Thomet.
The Company will also be settling the balance of the two promissory notes issued to Mr. Thomet, the outstanding balance of which is approximately $9.63M, by September 30, 2015 for $5.886 million in cash as well as the $1.15M paid relative to the Rampart licenses as described above. The Company has further agreed to purchase 900,000 shares of Mr. Thomet's common stock no later than December 31, 2015 at a price of at $0.38 per share. Additionally, Mr. Thomet terminated 5,600,000 unexercised warrants to purchase Company common stock under two separate agreements and accepted the termination of his Consulting Agreement with the Company and associated 1,500,000 shares of restricted common stock. The effect of the stock buyback and cancellation of unexercised warrants on the Company's weighted average fully diluted shares is a net 2.4M share reduction, based on the amount reported in our Form 10Q as of June 30, 2015.
Given the debt settlement, the income statement impacts from these changes would include:
Cash interest expense per quarter savings of approximately $47,500,
Non-cash OID interest expense savings per quarter of approximately $138,000
These amounts are based on the historical cash and non-cash interest expenses the company incurred.
"We are excited about this settlement agreement because in addition to providing Mr. Thomet good value, it provides financial flexibility for the company to pursue further growth opportunities, at a more rapid pace than previous," Miller added.
A more detailed description of Mr. Thomet's resignation and the related settlement transaction is available in the Company's corresponding report being filed with the Securities and Exchange Commission on Form 8-K.
