Seprotech Resolves Over-billing issue with Department of National Defence

OTTAWA, March 14 /CNW/ -- 
OTTAWA, March 14 /CNW/ - Seprotech Systems Incorporated (TSX-V: SET)
 ("Seprotech" or the "Company") is pleased to report that it has now
 reached a final settlement with respect to a previously announced
 over-billing issue with its client, the Department of National Defence
 ("DND"). The final amount as agreed between the parties is $315,584 and
 as previously announced, DND has agreed that the matter can be
 rectified by way of credits against actual work currently in process.
 In this regard, $150,000 has already been paid to DND, with the balance
 expected to be repaid in full by April 30, 2011.


As has previously been reported, the above-mentioned overbilling
 resulted in an overstatement of previously reported revenues in the
 Company's unaudited consolidated financial statements for the quarters
 ended November 30, 2009, February 28, 2010 and May 31, 2010. It has
 also resulted in a delay in filing the Company's Audited Annual
 Financial Statements for the fiscal year ended August 31, 2010, as well
 as the related MD&A and CEO and CFO certifications. The Company has
 also reported that for these reasons it would not be able to file its
 interim financial statements for the quarter ended November 30, 2010,
 and the related MD&A and CEO and CFO certifications, by January 31,
 2011 as required under securities laws.


The Company will now be able to complete the restatement of unaudited
 quarterly financial statements and related filings for fiscal 2010, to
 complete the Annual Audited Financial Statements and related filings
 for the fiscal year ended August 31, 2010 and to complete the interim
 financial statements for the quarter ended November 30, 2010. The
 Company is taking steps to bring all filings up to date by April 30,
 2011.


Jordan B. Grant, the new CEO of Seprotech stated, "The overbilling was
 discovered in an internal management review and we have demonstrated to
 DND that we take our responsibilities very seriously. We expect that
 this event will not affect our ability to compete for contracts with
 DND". Mr Grant continued, "this whole episode has obviously been very
 distracting for the company. We are pleased to now have it behind us so
 we can concentrate on our current priorities, which are converting our
 substantial sales pipeline into firm orders and addressing our working
 capital issues."


Seprotech is a provider of pre-engineered water and wastewater treatment
 plants to the land development, resource sector and military market
 place, including CrystalBlue™ membrane-based water recycling systems
 and the ROTORDISK® wastewater treatment systems.



Neither 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.
 The TSX Venture Exchange has neither approved nor disapproved of the
 information contained herein. Some of the statements in this press
 release, including those relating to the Company's strategies and other
 statements that are predictive in nature, that depend upon or refer to
 future events or conditions, or that include words such as "expects",
 "anticipates", "intends", "plans", "believes", "estimates" or similar
 expressions, are forward-looking statements within the meaning of
 securities laws. Forward-looking statements include, without
 limitation, the information concerning possible or assumed future
 results of operations of the Company. These statements are not
 historical facts but instead represent only the Company's expectations,
 estimates and projections regarding future events. The Company does not
 undertake any obligation to update or release any revisions to these
 forward-looking statements to reflect events or circumstances after the
 date of this presentation or to reflect the occurrence of unanticipated
 events, except as required by law.


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pMr. Matthew Anderson, Investor Relationsbr/ Tel: [phone]br/ Fax: [phone]/p

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