Seprotech updates status of previously reported delay in filing of 2010 annual financial statements and first quarter 2011 inter

OTTAWA, Feb. 23 /CNW/ -- 
OTTAWA, Feb. 23 /CNW/ - Seprotech Systems Incorporated (TSX-V: SET)
 ("Seprotech" or the "Company") is issuing this press release as a
 default status report in accordance with National Policy 12-203.


In its press release on December 17, 2010, (the "Default Notice"), the
 Company announced that it would not be able to file its audited
 financial statements for the year ended August 31, 2010 (the "Annual
 Financial Statements") and its related MD&A and CEO and CFO
 certificates (collectively, the "Annual Required Filings") by December
 29, 2010 as required under securities laws.


By its subsequent press releases and related material change reports
 issued and filed between December 29, 2010 and February 9, 2011, the
 Company provided updates on the status of the Annual Financial
 Statements and the Annual Required Filings, and also reported a
 material change relating to an overstatement of revenues as reported in
 its financial statements for the quarters ended November 30, 2009,
 February 28, 2010, May 31, 2010 and possibly for the year ended August
 31, 2009, in an undetermined material amount. In its press release
 dated January 26, 2011, the Company also reported that 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 following is an update of material changes to the information set
 out in the Default Notice and the bi-weekly Default Status Reports.


As previously reported, the Company had over-billed its customer, the
 Department of National Defence, Canada (the "DND") an amount not
 expected to exceed $300,000 under its contract with the Company.
 Arrangements have been made to repay such an amount by way of credits
 against actual work currently in process. One minor aspect of the
 materials provided to DND continues to be under review with an early
 response expected. However, until the precise amount of the overbilling
 is confirmed by DND, and accepted by the Company's auditors, the
 Company is not in a position to finalize quantification and/or
 allocation of the over-billing to the appropriate historical fiscal
 quarters thereby enabling completion of the audit of its Annual
 Financial Statements and subsequent filing of its Annual Required
 Filings as well as its first quarter 2011 filings. Finalization of this
 process is expected to further delay the filing of the Annual Required
 Filings until April 30, 2011, and the first quarter 2011 filings to May
 31, 2011. In the event of any significant further delay in the response
 from DND, completion of outstanding filings could be further delayed.


The Company confirms that:



(i)    there has been no failure by the Company in fulfilling its
       stated intentions with respect to satisfying the provisions of
       the alternative information guidelines set out in NP 12-203;

(ii)   there has not been any other anticipated or specified default by
       the Company under NP 12- 203; and

(iii)  there is no other material information concerning the affairs of
       the Company that has not been generally disclosed.





The Company will continue to satisfy the provisions of the alternative
 information guidelines under NP 12-203 by issuing bi-weekly default
 status reports in the form of news releases so long as it remains in
 default of the filing requirements set out above.


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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