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EGN Engineering.Com Incorporated

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Share Name Share Symbol Market Type
Engineering.Com Incorporated TSXV:EGN TSX Venture Common Stock
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 0 -

ENGINEERING.com Incorporated Announces Third Quarter 2013 Results and Approves Proposal to Take ENGINEERING.com Incorporated ...

14/11/2013 8:28pm

Marketwired Canada


ENGINEERING.com Incorporated  (TSX VENTURE:EGN), a digital media company that
informs, inspires and engages engineers, today announced its unaudited financial
results for the third quarter ended September 30, 2013 and that it has approved,
subject to shareholder and regulatory approval, a proposal (the "Proposal") by
Frank Baldesarra ("Baldesarra"), a director and the Chief Executive Officer,
Secretary and Treasurer of the Corporation, to take ENGINEERING.com private by
way of a share consolidation.


Third Quarter 2013 Results

Revenue was $495,031 for the three months ended September 30, 2013 and
$1,369,260 for the year-to-date, compared to revenue of $383,485 for the third
quarter and $1,437,075 for the first nine months of 2012.


Operating loss (EBITDA) measured as earnings before interest, taxes,
amortization and stock-based compensation, was ($7,760) for the third quarter of
2013 and ($33,744) for the year-to-date, compared with an operating loss of
($56,780) for the three month period ended September 30, 2012 and ($67,533) for
the first nine months of 2012.


The operating expenses in the latest quarter were $308,756 compared to $263,408
in the third quarter a year earlier and $894,401 for year-to-date, compared to
$857,577 for the first nine months of 2012.


The net loss for the three months ended September 30, 2013, totaled ($11,239)
and $0.00 per Common Share and ($45,229) and $0.00 per Common Share for the
September 30, 2013 year-to-date. These results are compared to a net loss of
($63,634) and $0.00 per Common Share for the third quarter of 2012 and ($90,627)
and $0.00 per Common Share for the first nine months of 2012.


As at September 30, 2013, the Company had a cash balance of $223,560 compared to
a cash balance of $231,196 as at December 31, 2012.


Going Private Transaction

Under the Proposal, the going private transaction will be accomplished through
the consolidation of ENGINEERING.com's issued and outstanding Common Shares. The
Proposal contemplates the consolidation of the Common Shares on the basis of one
new common share for each 350,000 Common Shares now outstanding (the
"Consolidation). Those shareholders who would otherwise have been entitled to
receive fractional shares will instead be paid $0.03 in cash per Common Share
held by them prior to the consolidation (the "Consolidation Price"), and
Baldesarra, together with those shareholders of ENGINEERING.com who held at
least 350,000 Common Shares prior to the Consolidation, will be the only
shareholders of ENGINEERING.com following the Consolidation.


The Consolidation Price represents a 100% premium to the volume-weighted average
closing price of ENGINEERING.com's Common Shares on the TSX Venture Exchange for
the 30 trading days ended November 8, 2013, and a 126% premium to the
volume-weighted average closing price of ENGINEERING.com's Common Shares on the
TSX Venture Exchange for the 52 weeks ended November 8, 2013. The Consolidation
is subject to the approval of 2/3 of the Common Shares voted at
ENGINEERING.com's upcoming special meeting of shareholders scheduled to occur on
December 19, 2013 at 10:00 am at the Company's offices at 5285 Solar Drive in
Mississauga (the "Meeting") as well as the approval of a majority of the votes
cast by minority shareholders at the Meeting pursuant to the requirements of
Multilateral Instrument 61-101 - Protection of Minority Security Holders in
Special Transactions.


Baldesarra, who owns or controls approximately 52.3% of the outstanding Common
Shares, and his associates and affiliates, and members of management and the
directors of ENGINEERING.com, who collectively own or control 19.4% of the
outstanding Common Shares, have advised ENGINEERING.com that they intend to vote
all of their Common Shares in favour of the Consolidation.


The board of directors of ENGINEERING.com established an independent special
committee to review the Consolidation and the Proposal and engaged Industrial
Alliance Securities Inc. to provide a fairness opinion in relation to the
Consolidation Price (the "Fairness Opinion"). The special committee recommended
to ENGINEERING.com's board of directors that the Consolidation be approved. The
Fairness Opinion will be attached to ENGINEERING.com's management information
circular for the Meeting, which will be available under ENGINEERING.com's
profile at www.sedar.com.


Subject to the approval of the Consolidation at the Meeting and the acceptance
of the TSX Venture Exchange, ENGINEERING.com intends to file articles of
amendment to effect the Consolidation. Once the Consolidation is completed,
ENGINEERING.com intends to apply to have its Common Shares delisted from the TSX
Venture Exchange and intends to apply to cease to be a reporting issuer with the
applicable securities regulatory authorities.


ENGINEERING.com proposes to complete the going private transaction in order to
eliminate the financial burden of continuing as a reporting issuer.
ENGINEERING.com believes that the anticipated time, costs and regulatory
requirements that are entailed in meeting the legal obligations to public
shareholders cannot be justified in view of its present circumstances, including
very low trading volumes and a limited number of public shareholders.


About ENGINEERING.com Incorporated

ENGINEERING.com Incorporated (TSX VENTURE:EGN) inspires, informs and entertains
a worldwide audience of engineers through the www.ENGINEERING.com web site,
mobile and social media channels. ENGINEERING.com offers marketing services to
manufacturers, technology inventors and engineering academia. The
ENGINEERING.com Incorporated head office is located in Mississauga, Ontario,
Canada and can be reached toll-free at 1-877-997-9917, by facsimile at
905-273-6691 or through the Internet at www.ENGINEERING.com. 


EBITDA

EBITDA is defined by the Company as operating income before interest expense,
income taxes, amortization, stock - based compensation, asset dispositions and
provision for discontinued operations. The Company has included information
concerning EBITDA because it believes that EBITDA is used by certain investors
as one measure of the Company's financial performance. EBITDA is not a measure
of financial performance under International Financial Reporting Standards and
is not necessarily comparable to similarly titled measures used by other
companies. EBITDA should not be construed as an alternative to operating income
or to cash flows from operating activities as a measure of liquidity.


Forward Looking Statements

This press release may contain forward-looking statements based on management's
current projections, beliefs and opinions at the date of this press release.
Actual results could differ materially from those anticipated in these
statements. ENGINEERING.com Incorporated undertakes no responsibility to update
forward-looking statements if circumstances or management's projections, beliefs
or opinions change.


The contents of this News Release have been reviewed and approved by the Audit
Committee and the Board of Directors.


The TSX Venture Exchange Inc. has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.




                                                                            
STATEMENTS OF FINANCIAL POSITION                                            
Expressed in Canadian Dollars                                               
                                                                            
As at September 30, 2013                                                    
(With comparative amounts as at December 31, 2012)                          
                                                                            
                                                 Sep. 2013        Dec. 2012 
ASSETS                                                                      
CURRENT ASSETS                                                              
 Cash                                      $       223,560  $       231,196 
 Accounts receivable                               218,513          248,662 
 Prepaids expenses and deposits                     31,488           24,529 
----------------------------------------------------------------------------
TOTAL CURRENT ASSETS                               473,561          504,387 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
NON-CURRENT ASSETS                                                          
 Property and equipment                              8,476           10,334 
 Intangible assets                                 333,940          331,522 
----------------------------------------------------------------------------
TOTAL NON-CURRENT ASSETS                           342,416          341,856 
----------------------------------------------------------------------------
                                                                            
TOTAL ASSETS                               $       815,977  $       846,243 
----------------------------------------------------------------------------
                                                                            
LIABILITIES AND SHAREHOLDER'S EQUITY                                        
CURRENT LIABILITIES                                                         
 Accounts payable & accrued liabilities    $       436,887  $       429,433 
 Deferred revenue                                  207,678          207,179 
----------------------------------------------------------------------------
TOTAL LIABILITIES                                  644,565          636,612 
----------------------------------------------------------------------------
                                                                            
SHAREHOLDER'S EQUITY                                                        
 Share capital                                  15,450,966       15,450,966 
 Contributed surplus                               524,844          517,834 
 Deficit                                       (15,804,398)     (15,759,169)
----------------------------------------------------------------------------
TOTAL SHAREHOLDERS EQUITY                          171,412          209,631 
----------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY  $       815,977  $       846,243 
----------------------------------------------------------------------------
                                                                            
                                                                            
NOTICE: The Company's auditors have not audited or reviewed these financial 
 statements.                                                                
                                                                            
                                                                            
STATEMENTS OF CHANGE IN SHAREHOLDERS' EQUITY                                
Expressed in Canadian Dollars                                               
                                                                            
For the period ended September 30, 2013                                     
(With comparative balances for the period ended September 30, 2012)         
                                                                            
                     Number                                                 
                         of                                                 
                     Common       Share Contributed                         
                     Shares     Capital     Surplus      Deficit      Total 
----------------------------------------------------------------------------
At December 31,                                                             
 2011            43,870,623 $15,450,966 $   497,899 $(15,602,800) $ 346,065 
Net loss for the                                                            
 period                                                  (90,627)   (90,627)
Stock based                                                                 
 compensation                                16,285                  16,285 
----------------------------------------------------------------------------
At September 30,                                                            
 2012            43,870,623 $15,450,966 $   514,184 $(15,693,427) $ 271,723 
----------------------------------------------------------------------------
                                                                            
At December 31,                                                             
 2012            43,870,623 $15,450,966 $   517,834 $(15,759,169) $ 209,631 
Net loss for the                                                            
 period                                                  (45,229)   (45,229)
Stock based                                                                 
 compensation                                 7,010                   7,010 
----------------------------------------------------------------------------
At September 30,                                                            
 2013            43,870,623 $15,450,966 $   524,844 $(15,804,398) $ 171,412 
----------------------------------------------------------------------------
                                                                            
                                                                            
NOTICE: The Company's auditors have not audited or reviewed these financial 
 statements.                                                                
                                                                            
                                                                            
STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)                 
Expressed in Canadian Dollars                                               
                                                                            
For the period ended September 30, 2013                                     
(With comparative amounts for the period ended September 30, 2012)          
                                                                            
                               Three months ended         Nine months ended 
                                2013         2012         2013         2012 
                                                                            
REVENUE                  $   495,031  $   383,485  $ 1,369,260  $ 1,437,075 
COST OF SALES                194,035      176,857      508,603      647,031 
----------------------------------------------------------------------------
GROSS PROFIT                 300,996      206,628      860,657      790,044 
----------------------------------------------------------------------------
                                                                            
OPERATING EXPENSES                                                          
 Salaries and marketing      118,085      103,850      346,259      338,117 
 Development and                                                            
  operations                  96,372       85,658      279,082      246,402 
 General and                                                                
  administrative              94,299       73,900      269,060      273,058 
----------------------------------------------------------------------------
TOTAL OPERATING EXPENSES     308,756      263,408      894,401      857,577 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
INCOME (LOSS) BEFORE                                                        
 UNDERNOTED ITEMS:            (7,760)     (56,780)     (33,744)     (67,533)
----------------------------------------------------------------------------
                                                                            
 Stock based                                                                
  compensation                (2,169)      (4,591)      (7,010)     (16,285)
 Amortization expense         (1,310)      (2,263)      (4,475)      (6,809)
----------------------------------------------------------------------------
NET INCOME (LOSS) &                                                         
 COMPREHENSIVE INCOME    $   (11,239) $   (63,634)     (45,229) $   (90,627)
----------------------------------------------------------------------------
                                                                            
Earnings (Loss) Per                                                         
 Share                                                                      
 Basic                   $      0.00  $      0.00  $      0.00  $      0.00 
 Diluted                 $      0.00  $      0.00  $      0.00  $      0.00 
Weighted average number                                                     
 of common shares                                                           
(Basic and Diluted)       43,870,623   43,870,623   43,870,623   43,870,623 
----------------------------------------------------------------------------
                                                                            
                                                                            
NOTICE: The Company's auditors have not audited or reviewed these financial 
 statements.                                                                
                                                                            
                                                                            
STATEMENTS OF CASH FLOWS                                                    
Expressed in Canadian Dollars                                               
                                                                            
For the period ended September 30, 2013                                     
(With comparative amounts for the period ended September 30, 2012)          
                                                                            
                                                                            
                               Three months ended         Nine months ended 
                                2013         2012         2013         2012 
OPERATING ACTIVITIES                                                        
                                                                            
Net Income (Loss)        $   (11,239) $   (63,634) $   (45,229) $   (90,627)
Add items not affecting                                                     
 cash                                                                       
  Stock based                                                               
   compensation                2,169        4,591        7,010       16,285 
  Amortization                 1,310        2,263        4,475        6,809 
  Changes in operating                                                      
   assets and                                                               
   liabilities other                                                        
   than cash                 (26,220)     (40,987)      31,142      131,432 
----------------------------------------------------------------------------
CASH FLOWS FROM                                                             
 OPERATING ACTIVITIES        (33,980)     (97,767)      (2,602)      63,899 
----------------------------------------------------------------------------
                                                                            
INVESTING ACTIVITIES                                                        
  Additions to property                                                     
   and equipment                (401)      (1,133)      (2,616)      (5,301)
  Additions to                                                              
   intangible assets          (2,113)        (527)      (2,418)      (5,595)
----------------------------------------------------------------------------
CASH FLOWS FROM                                                             
 INVESTING ACTIVITIES         (2,514)      (1,660)      (5,034)     (10,896)
----------------------------------------------------------------------------
                                                                            
INCREASE (DECREASE) IN                                                      
 CASH                        (36,494)     (99,427)      (7,636)      53,003 
                                                                            
CASH, Beginning of                                                          
 period                      260,054      411,444      231,196      259,014 
----------------------------------------------------------------------------
                                                                            
CASH, End of period      $   223,560  $   312,017  $   223,560  $   312,017 
----------------------------------------------------------------------------
                                                                            
                                                                            
NOTICE: The Company's auditors have not audited or reviewed these financial 
 statements.                                                                



FOR FURTHER INFORMATION PLEASE CONTACT: 
ENGINEERING.com, Inc.
John Hayes
President & CFO
905-273-9991, ext. 3280
905-273-6691 (FAX)
jhayes@engineering.com
www.engineering.com

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