MILWAUKEE, Feb. 11, 2019 /PRNewswire/ -- EnSync, Inc. (NYSE American: ESNC), dba EnSync Energy Systems (the "Company"), which is creating the future of electricity with innovative residential and commercial distributed energy resource (DER) systems and Internet of Energy (IOE) control platforms, reported that, each of Richard Abdoo, Paul Koeppe, James Ozanne and Theodore Stern resigned as a member of the Board of Directors (the "Board") of the Company.
On February 11, 2019, the Company notified The NSYE American ("NYSE American") that these resignations had caused compliance deficiencies with the following sections of the NYSE American Company Guide: Section 802, requiring a majority-independent board, and Section 803, requiring an audit committee comprised of three independent directors.
Following the end of the second quarter of fiscal 2019, the offtaker for a sizeable project the Company was working on in Hawaii sent the Company a letter purporting to terminate the subject power purchase agreement ("PPA"). Although this purported termination was without basis and was subsequently retracted by the offtaker, the Company's receipt of this termination letter triggered a variety of significantly negative events for the Company including: (i) prevented the Company from successfully concluding negotiations for the sale of the PPA, which was expected to provide significant upfront payments; (ii) the Company delayed or canceled orders for a significant amount of equipment it had ordered in anticipation of commencing the project and facilitating timely completion of the project according to the offtaker's aggressive project timelines, which severely negatively impacted relationships with some key suppliers; and (iii) negatively impacting the Company's ability to pursue financing options, including strategic partnership transactions, PPA project financing facilities, working capital lines of credit, and additional sales of Common Stock or other debt or equity securities, which have also been negatively impacted by the deterioration in the state of the capital markets that began in the second quarter of fiscal 2019.
As previously reported on the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission on January 25, 2019, (i) on January 23, 2019 Bradley Hansen resigned as the Company's President and Chief Executive Officer and as a member of the Company's Board of Directors, and (ii) on January 24, 2019 Sandeep Gupta was appointed as the Company's interim Chief Executive Officer and Chief Restructuring Officer and also as a member of the Company's Board of Directors. Mr. Gupta is a principal and founder of Novo Advisors, and his expertise ranges from the development of short-term liquidity forecasts, break-even analyses, and performance/profit improvement studies to mergers and acquisitions and liquidation analyses for healthy and distressed businesses across a wide array of industries.
Due to the severe impacts of the above and the current state of its business, the Company has a very short term need for additional financing which it has been actively pursuing. However, the Company has no commitments to obtain any additional financing, and if it does not obtain sufficient financing in the very near term, it will likely need to discontinue operations and initiate insolvency proceedings.
About EnSync Energy Systems
EnSync, Inc. (NYSE American: ESNC), dba EnSync Energy Systems (EnSync Energy), is creating the future of electricity with innovative distributed energy resource (DER) systems and internet of energy (IOE) control platforms. EnSync Energy ensures the most cost-effective and resilient electricity, delivered from an electrical infrastructure that prioritizes the use of all available resources, such as renewables, energy storage and the utility grid. As project developer, EnSync Energy's distinctive engagement methodology encompasses load analysis, system design consulting, and technical and financial modeling to ensure energy systems are sized and optimized to meet our customers' objectives for value and performance. Proprietary direct current (DC) power control hardware, energy management software, and extensive experience with numerous energy storage technologies uniquely positions EnSync Energy to deliver fully integrated systems that provide for efficient design, procurement, commissioning, and ongoing operation. EnSync Energy's IOE control platform adapts easily to ever-changing generation and load variables, as well as changes in utility prices and programs, ensuring the means to make or save money behind-the-meter, while concurrently providing utilities the opportunity to use DERs for an array of grid enhancing services. In addition to direct system sales, EnSync Energy includes power purchase agreements (PPAs) in its portfolio of offerings, which enables electricity savings for customers and provides a stable financial yield for investors. EnSync Energy is a global corporation, with joint venture Meineng Energy in AnHui, China, and energy project development subsidiary Holu Energy LLC in Hawaii. For more information, visit www.ensync.com.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are intended to be covered by the "safe harbor" created by those sections. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of forward-looking terms such as "believe," "expect," "may," "will," "should," "could," "seek," "intend," "plan," "goal," "estimate," "anticipate" or other comparable terms. All statements other than statements of historical facts included in this press release regarding our strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking statements. Examples of forward-looking statements include, among others, statements we make regarding project completion timelines, our ability to monetize our PPA assets, statements regarding the sufficiency of our capital resources, expected operating losses, expected revenues, expected expenses and our expectations concerning our business strategy. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: our historical and anticipated future operation losses and our ability to continue as a going concern; our ability to raise the necessary capital to fund our operations and the risk of dilution to shareholders from capital raising transactions; our ability to successfully commercialize new products, including our EnSync Smart Home Energy System, Matrix TM Energy Management, DER Flex TM, DER SuperModule TM, and Agile TM Hybrid Storage Systems; our ability to lower our costs and increase our margins; our product, customer and geographic concentration, and lack of revenue diversification; the length and variability of our sales cycle; our dependence on governmental mandates and the availability of rebates, tax credits and other economic incentives related to alternative energy resources and the regulatory treatment of third-party owned solar energy systems; and the other risks and uncertainties described in the Risk Factors and in Management's Discussion and Analysis of Financial Condition and Results of Operations sections of our most recently filed Annual Report on Form 10-K and our subsequently filed Quarterly Report(s) on Form 10-Q. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
EnSync Energy Media Contact:
Antenna Group for EnSync Energy
Investor Relations Contact:
Lytham Partners, LLC
Robert Blum, Joseph Diaz, or Joe Dorame
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SOURCE EnSync, Inc.