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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