Company now controls all intellectual property and global production and distribution rights for Kryron
TUCSON, Ariz.?(BUSINESS WIRE)?Bourque Industries, Inc. (OTC: BORK) management today announced four key strategic business acquisitions to consolidate all facets of Kryron technology into a single corporate entity. This includes all sales, distribution, manufacturing, future product development, and intellectual property comprising all global Kryron patents and licensing rights.
Bourque also announced an enhancement to its business strategy, which will now expand to focus on the development, licensing, and commercialization of a broad range of products utilizing Kryron, its patented aluminum alloy, and other Kryronized metal alloys. The Company will also develop basalt-based materials using technology from newly-acquired Basalt Fiber Technologies, LLC.
Beyond its current line of protective ballistic armor plates under development, Bourque plans to pursue development of conductive materials, agriculture and heavy equipment, mining technology, aviation and automotive components, and consumer electronics as well as other products which will benefit from the unique materials technology it has under development.
In execution of this strategy, the Company entered into Acquisition Agreements on September 26, 2011, to acquire three companies controlled by John M. Bourque ? Bourque Industries? principal shareholder, CEO, Director and Chief Scientist ? each of which hold certain pre-existing license rights to Kryron technology. Upon consummation of these three acquisitions, Bourque Industries will control all rights to the Kryron material and Kryron patents for all uses, worldwide, in all markets and for all products.
?This fundamental restructuring is a major leap forward for Bourque Industries and Kryron technology,? said John M. Bourque. ?With the consolidation of all technology and operations into one company, Bourque Industries is ideally positioned to pursue our mission of redefining industry standards by developing revolutionary materials for a wide range of industrial, commercial, and military applications.?
Bourque Industries will acquire Bourque Alloys, LLC; Bourque Alloys Manufacturing, Inc.; and Kryron Global, LLC through reverse mergers and convert them into wholly-owned Company subsidiaries. In exchange, the shareholders of the respective target companies will receive 5.6 million shares, 92 million shares, and 12.5 million shares, respectively, of restricted Bourque Industries Common Stock. John M. Bourque, the inventor of Kryron, owns 100% of Kryron Global, which held all Kryron-related patents before the merge, and owns approximately 54.5% of the outstanding stock of the other two companies.
Bourque also entered into an Acquisition Agreement to acquire ? through a reverse merger into a wholly-owned Company subsidiary ? all of Basalt Fiber Technologies, LLC, in exchange for the issuance of 5.9 million shares of Bourque Industries restricted Common Stock to the target company?s shareholders. Kim D. Southworth, Basalt Fiber Technologies' President and a Director of the Company, owns approximately 75% of the outstanding stock of Basalt Fiber Technologies.
Basalt Fiber Technologies is developing new technology to produce basalt fiber in quantities far exceeding current production methods and at substantially lower costs. Basalt fiber is made from quarried basalt rock, which is heated and pushed through fine nozzles to create streams of molten rock that solidify into fibers. The resulting product is similar to fiberglass, but is physically stronger and significantly cheaper.
An inert rock found worldwide ? and in great quantities in the western United States ? basalt is the generic term for solidified volcanic lava. Basalt is used in the production of fireproof textiles for the aerospace and automotive industries and as a composite to produce a wide range of enhanced, innovative products. Bourque Industries plans to combine basalt with Kryron to develop new materials and applications and to diversify the revenue streams of the Company.
Bourque Industries will privately issue a total of approximately 116 million shares of Common Stock to acquire these four companies, out of which 65.5 million shares will be issued to John M. Bourque in exchange for his shares in three of the companies. Kim D. Southworth will be issued 4.5 million shares in exchange for his shares in Basalt Fiber Technologies, and 16 million shares for his minority position in Bourque Alloys Manufacturing. Upon consummation of these acquisitions, John M. Bourque?s holding of Bourque Industries, Inc. Common Stock will increase from approximately 52.5% to approximately 53.5%, and Kim D. Southworth?s holdings of Bourque Industries, Inc. Common Stock will increase from 0% to 6.9%. The Company?s total shares of Common Stock outstanding will increase to approximately 299 million shares.
These mergers and acquisitions are expected to be consummated in a matter of days, and although minority shareholders in each target company will be entitled to exercise dissenter?s rights, Company management does not anticipate that such rights will be exercised.
In furtherance of this new strategy, on September 23, 2011, Bourque Industries entered into a Royalty Agreement with John M. Bourque, whereby it acquired all remaining unlicensed rights to the Kryron technology and patents in exchange for the grant of a royalty interest to John M. Bourque. The Agreement has a term of 20 years, and provides for payment to Mr. Bourque of a 5% royalty on gross sales of products and services utilizing the Kryron technology and all derivative products.
The Company at the same time entered into an employment agreement with John M. Bourque, retaining him as CEO and Chief Scientist, to pursue further development, commercialization, marketing, and sale of products utilizing Kryron technology. The Agreement has a 10-year term (with renewal terms), which provides for an initial salary of $360,000 per year and the immediate issuance to Mr. Bourque of 100,000,000 shares of Bourque Industries Series A Preferred Stock.
The Preferred Stock is convertible into Common Stock at the rate of one Common share for each 1,000 Series A Preferred shares converted, is entitled to share in any dividends declared with Common at the rate of 1/1000th of the amount of any Common dividend, and is entitled to vote on all matters with Common, including the election of Directors, and has voting rights of four votes per each share, as contrasted to the one vote per share of outstanding Common Stock.
As a result of this issuance of Series A Preferred Stock to John M. Bourque, Mr. Bourque receives through ownership of the Series A Preferred Stock a right to receive any dividends declared in an amount equal to 100,000 shares of Common Stock, and retains the right at present to elect a majority of the Board of Directors and to determine other matters presented to the shareholders for a vote, since the Series A Preferred Stockholder will be entitled to cast 400 million votes on any matter, as compared to the approximately 199 million votes entitled to be cast by the currently outstanding Common Stock.
All actions were approved by the Company?s newly expanded Board of Directors with any affected Directors abstaining in each case.
ABOUT BOURQUE AND KRYRON
Bourque Industries, Inc. is a publicly-traded (OTC: BORK) development stage company based in Tucson, Ariz. Bourque is the distributor of Kryron-based technologies.
The Company has focused on development of state-of-the-art protective armor material that management believes can provide superior protection to first-response teams in the military and law enforcement at a pinnacle level of performance and innovation, utilizing a new material developed by John Bourque named ?Kryron.?
Kryron is a patented aluminum alloy and represents what management believes to be the optimal material for protective ballistic armor plates. Compared to industry-standard personal protection ceramic plates, Kryron Terminator armor demonstration products are lighter, far more durable, and eliminate spall and ricochet.
Using proprietary Kryron and basalt technologies, Bourque Industries will develop and market alloys and materials that management believes will have applications across a broad range of industries, including conductive materials, agriculture and heavy equipment, mining, aviation and automotive, and consumer electronics.
This communication to shareholders and the public contains certain forward-looking statements. Sometimes these statements will contain words such as "believes," "expects," "intends," "should," "will," "plans," and other similar words. The events described in these forward looking statements are not certain to occur. These statements are only predictions and involve known and unknown risks, uncertainties and many factors beyond our control. Among these risks are the risks that the new products under development by the Company will not work as anticipated, will not find market acceptance, and/or will not be able to be produced on a commercial scale which permits a profit, as well as the risks that the Company will be unable to obtain the necessary capital to complete development, commercialize, manufacture and distribute such products, or obtain such necessary capital on commercially reasonable terms. Although forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our management?s current expectations, actual results could differ materially from those anticipated in such statements.
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Bourque Industries, Inc.
Andrew Myers, 520-981-6207
andrew.myers@bourqueindustries.com
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