Groupe Conseil Omnitech Inc. ("GCO") (TSX VENTURE: GCO) files its Default Status Report in compliance with CSA Staff Notice 57-301.
GCO's directors and officers are presently the object of a Management CTO prohibiting them to trade GCO securities. A request to this effect has been filed to the regulatory authorities when it became apparent that GCO would not be able to file its year end audited financial statements, subsequent quarterly unaudited financial statements and their related management report within the prescribed delays.
A press release dated January 4th, 2007 described the reasons of the delay, namely the procedures related to the filing of the notice of intent to make a proposal to creditors in accordance with the provisions of the Bankruptcy and Insolvency Act. The procedures were completed around April 25 by the issuance of 195,247,999 common shares of GCO to its creditors. The total of outstanding common shares of GCO is now 253,027,374. The proposals to the creditors offered the payment of 100% of the value of creditors' claims in common shares of GCO at a price per share of $0.05.
Since April, GCO continues its audit process which encountered delays due to the complexity of the file. As a result, GCO will only be able to file its audited financial statements in mid-July.
Considering that GCO had not been able to provide up-to-date financial information since the filing of its financial statements for the quarter ended May 31, 2006, GCO's management decided to provide the following information on its current financial situation.
As of September 1st, 2006, GCO and its subsidiaries on a consolidated basis were using their line of credit facilities for a total of $3.150 million. On February 28, 2007, the use of the line of credit had been reduced to $1.345 million, a reduction of $1.805 million or close to 60%. As of May 31, 2007, the line of credit was at $1.480 million.
The corporation financed its line of credit reduction with a $500,000 financing by its management team, which took place in October 2006, and with a very rigorous management of its cash flows. Collection efforts of accounts receivables were also fruitful.
At the same time the corporation was reducing its line of credit, it paid, since October 2006 to this day, reorganization fees that total $786,000. Furthermore, since the beginning of April 2007, GCO paid to its auditors, for the audit of its financial statements for the period ended August 31, 2006, the sum of $140,000. GCO's operations generated, since October 2006, enough liquidity to cover those costs as well as pay its suppliers in advance or cash on delivery because of the proposal to creditors procedures.
In accordance with CSA Staff Notice 57-301, GCO confirms that except as described herein: (i) there is no material change in the information contained in the Notice of Default; (ii) there is no failure of GCO to fulfill the intentions stated in its Notice of Default or any Default Status Report; and (iii) there is no other material information concerning the affairs of GCO that has not been generally disclosed.
About Omnitech Consultant Group Inc. ("GCO")
GCO is a Canadian leader in performance engineering. GCO offers solutions as a one-stop-shop in engineering, information technology and systems maintenance. GCO is capable of intervening in all aspects of industrial engineering and information technology, thus combining a major and distinctive niche compared with the competition. GCO integrates new technologies or optimizes existing systems by applying cutting-edge expertise currently used in the best practices.
TSX Venture Exchange Inc. assumes no responsibility regarding the relevance or accuracy of this press release.
Groupe Conseil Omnitech inc.
Chief Executive Officer
Groupe Conseil Omnitech inc.
Philippe R. Bertrand
Vice-president, Corporate Affairs