BAY CITY, Mich. and TORONTO, Sept. 8, 2005 (PRIMEZONE) -- Sciax Corp. (Pink Sheets:SCXC) announced today that its Board of Directors has approved and the Company has filed a Form 15 with the SEC. The Company expects to realize significant cost savings as a result of being relieved of its SEC periodic reporting requirements. The Company's securities will continue to trade on the Over-The-Counter Pink Sheets (OTC), an electronic trading forum, which is regulated by applicable federal and state securities laws.
Commenting on the move, Giorgio C. Costonis, CEO, stated, "Current market conditions do not warrant the significant annual costs associated with being a reporting company. Our Board believes it is prudent to use these funds to enhance Sciax's financial performance. As a non-registered company, Sciax and RMD Entertainment will have more flexibility in pursuing strategic opportunities, continuing to invest in its core business, and in recruiting and retaining our people. This move will also enable management to focus more of our time on operating Sciax's business. We are still a public company and we currently plan to provide our shareholders and interested investors with regular unaudited quarterly and audited annual financial reporting. Once we have re-organized the Sciax Defense division of the company and implemented our business plan for RMD, then we will consider our options of becoming a fully reporting company and apply for re-listing on the OTCBB."
Among other factors, the Company's Board of Directors considered the following in making their decision:
1. The significant costs, both direct and indirect, of preparing
and filing the reports and forms a public company is required
to file with the SEC.
2. The substantial increase in those costs expected to arise in
implementing and maintaining the requirements of the
Sarbanes-Oxley Act of 2002.
3. Management will spend less time on SEC form preparation and
other aspects of compliance, and more time on the Company's
operations and objectives.
4. The valuation that the market is applying to the Company.
5. The liquidity available to investors in current market conditions.
6. The ability to control the information and the timing of
information available to the market in which the Company operates.
"We are determined to restore value to this company and with the addition of RMD Entertainment (RMD) as a cutting-edge music company, we believe this move will allow us to focus on the important task of growing our business," added Costonis. "It was simply a matter of dollars and cents for our company and our stockholders. We are concentrating on bringing revenue into the company and the initiatives that we have begun to undertake cost money to execute. I am confident that our decision to use available funds to generate profits versus preparing and filing reports and forms will prove to be a prudent one. I remain pleased with our progress in the restructuring of our organization and am excited about the prospects for Sciax in the long and short term."
About Sciax
RMD Entertainment Inc. Division
RMD Entertainment (RMD) is a cutting-edge entertainment company with a primary focus on selling hip-hop music internationally. Additionally, the company markets other products, such as fashion accessories and fragrances, which are purchased by its music audience. RMD has a vast worldwide distribution network for its music to be sold to the end consumer in compact disc formats, digital downloads, and personal ringtones for mobile customers. RMD's hip-hop catalogue is exclusively distributed by Bungalo Records in North America, which is exclusively distributed by Universal Music Group. RMD's dance music catalogue is exclusively distributed by Inversus Records.
Truly a global company with well over 60 years combined experience in the music industry, RMD has had good success on the international level and its staff producers have collaborated with some of the most influential names in the music scene today, such as Sting, David Byrne of the Talking Heads, George Kranz, Freedom Williams of C & C Music Factory, Steve Winwood, Robin Scott, and jazz saxophone legend Bill Evans, among others.
Sciax Defense Division
Sciax Defense is an emerging leader in defense imaging systems for law enforcement and military personnel engaged in counter-terrorism and other special security operations. Sciax America Inc. and Sciax Technology Inc. are wholly owned subsidiaries of Sciax Corp. (http://www.sciax.com). Wolf Pack, the company's tactical remote viewing system, is manufactured under license from Eomax Corp. and is used by law enforcement and military organizations in North America and Europe. Customers include military and law enforcement agencies of the U.S. and German governments, contraband interdiction units of Canada Customs, and LAPD-SWAT.
This release contains forward-looking statements with respect to the results of operations and businesses of Sciax Technology Inc., Sciax America Inc., RMD Entertainment Inc. and Sciax Corp., which involve risks and uncertainties. The company's actual future results could materially differ from those discussed. Risks and uncertainties of the company will be detailed from time to time in the company's periodic reports. The company intends that such statements about the company's future expectations, including future revenues and enforcement and defense imaging system earnings, entertainment product earnings, and all other forward looking statements, be subject to the "safe harbor" provision of the Private Securities Litigation Reform Act of 1995.