At the Meeting shareholders of the Corporation (the "Shareholders") voted in favour of all items of business on the agenda. In particular, all nominees for election to the board of directors of the Corporation (the "Board") were elected by the Shareholders including Mr. Jim Kirchner, the Corporation's Chief Executive Officer and Mr. George Hendy, who was nominated for the first time. Also elected were Messrs. Claude Delage and Nicolas Beauchamp who will serve effective on the completion date of the Secured Loan Transaction described in the Management Information Circular (the "Circular"). Messrs. Kevin Pawsey, Matthew Cooper, and Sean Maniaci did not stand for re-election to the Board for the upcoming year and the Corporation would like to thank them for their service. The full biographies of all the Board members can be found in the Circular for the Meeting on SEDAR at www.sedar.com.
In addition, at the Meeting the shareholders approved the creation of a control person, the full text of which can be found in the Circular.
In July, given the cash issues facing the corporation, the first order of business was to significantly reduce the expenses and cash burn rate, Cash expenses decreased from $460,000 per month in the quarter ended June 30, 2016 to $199,000 in the quarter ended September 30, 2016. During this period of limited resources, we were able to successfully develop version 2 of Ormiboard and initiate a plan to take it to market.
Since July, 2016, we have been working to review all aspects of the business to improve customer and operational success.
With the coming release of version 2 of Ormiboard, we will be positioning our product, with our manufacturer partners, Panasonic, Genee World and Samsung, as the instructional any device collaboration learning solution. We continue to see a significant opportunity to be the platform of choice to bridge the requirements of whole class teaching and "Bring Your Own Device" (BYOD) initiatives employed by school districts. BYOD is the term which describes when students are able to bring in their own tablets, phones, Chromebooks and laptops to use for school based lessons and activities.
Our newest version will provide an upgraded user interface, enhanced editing and creation tools, and significant interoperability with software such as Microsoft Powerpoint, Smart Notebook Google Classroom and Google slides.
The Company's new strategy has been to target known and proven distribution and reseller channels selling into Education in North America, Europe and the Middle East. We are anticipating 60% of EXO U's business to originate in the US, although there are also focused initiatives in Europe where the Company's technology is very well aligned. We have developed a plan to engage dozens of education Resellers that will want to sell Ormiboard to provide additional value to the hardware they are currently selling to schools and colleges.
Samsung has agreed to partner with EXO U to offer our software bundled with Samsung Mobile devices for the coming school year. Our team will partner with Samsung Resellers to develop business and demonstrate the value of our combined solution for engaged learning.
Panasonic Corporation of North America ("Panasonic") is another key partner. With this agreement, Panasonic and their extensive network of distribution channels and resellers are licensed to bundle EXO U's technology with their technology devices. We are co-presenting with Panasonic at many of their roadshows to districts across the US and are actively engaged in pipeline generation with them.
Genee World is a provider of advanced display technology and interactive presentation tools. In February 2016, following BETT , we signed Genee World as our European distribution partner. Genee World has been selling education technology into the UK and European schools and universities for over 15 years. We are exposing Version 2 of Ormiboard at BETT 2017 this week. Genee World currently bundles Ormiboard with every large format interactive screen and with their own student devices that they ship into education institutions across Europe.
The revenues expected from our agreement from QOMO have not materialized. Yazmi has also cancelled their contract and no longer has the right to sell EXO U products.
Revenues and Contracts
We were able to initiate limited sales revenues from our partners in the past year. However, education revenues are more seasonal in nature than other market verticals. The new management team understands that most revenues in education are recognized during the third calendar year quarter. This is a consequence of the buying cycle that sees education buyers evaluate potential tools from December to June and with purchase orders being generally sent to vendors from April to July. Thus, we expect the core revenues to occur in the July to October timeframe.
Our K-12 product is available for sale and is being sold and marketed with four distribution partners. EXO U is expected to have revenue growth with strong margins in 2017. EXO U will continue to refine operational costs to improve margins and cash flow.
The Company had previously announced on November 21, 2016, a financing through a Loan Agreement with Alternative Capital Group Inc. The shareholders approved this loan at the Annual General Meeting and we expect to close the agreement with initial financing in late January or early February. The proceeds from the financing will be used to enhance our product development, marketing and sales efforts with a focus on engaging Resellers.
About EXO U
At EXO U, we believe that people learn best with instructional technologies that support and do not interrupt the momentum of teaching, learning and collaboration-whether they are learning in person, remotely, or across an evolving device landscape. That is why our web-based whiteboarding and classroom management solutions for educational institutions and corporations work on any device with any operating system, anytime and anywhere, solving important mobility issues such as security, privacy, real-time collaboration, and management of application and content. EXO U's shares trade on the TSX Venture Exchange under the ticker symbol EXO.V. For more information, visit http://www.exou.com and follow us on Twitter @exo u. For ore information on Ormiboard, visit https://www.ormiboard.com and follow us on Twitter @ormiboard.
Cautionary Note Regarding Forward Looking Information
Certain statements included herein, including those that express management's expectations or estimates of EXO U's future performance or future events, constitute "forward looking information" within the meaning of applicable securities laws. Such forward-looking information and statements are often, but not always, identified by the use of words such as "plans", "expects", "estimates", "intends", "anticipates", or "believes", or variations of such words and phrases (or the negative form thereof) or statements that certain actions, events or results "may", "could", "would", "might", or "will" be taken, occur or be achieved. Forward -looking information is necessarily based on a number of estimates and assumptions that , while considered reasonable by management at the time, are inherently subject to significant business, economic, regulator and competitive uncertainties and contingencies that could cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information, including, but not limited to, risks related to whether or not the Company will enter the loan arrangement, and risks related to the Company's incapacity to execute on its business plan. For additional information with respect to certain of these and other assumptions and risk factors, please refer to EXO U's management's discussion and analysis for the year ended March 31, 2016, available under the Company's profile on SEDAR at www.sedar.com. Forward-looking information contained herein is presented as of the date of this news release and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results, except as may be required by applicable securities laws. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers are cautioned not to place undue reliance on these forward-looking statements.
Neither the TSX Venture Exchange 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.
SOURCE EXO U Inc