ANN ARBOR, Mich., Aug. 22, 2016 /PRNewswire/ -- Arotech
Corporation (Nasdaq GM: ARTX) today announced that as of
August 31, 2016, it will discontinue
all work on its Iron Flow Storage project. Arotech will maintain
its Iron Flow Storage intellectual property for sale to a third
party willing to take on the expenses of continued development.
Arotech also announced that its former Executive Chairman and
current Iron Flow Storage program Chairman Robert S. Ehrlich has agreed to an early
termination of his employment agreement, which is currently
scheduled to extend until December 31,
2017, in exchange for a lump-sum payment. The lump-sum
payment represents a future cost avoidance to Arotech of
approximately $140,000 over the
amount that Arotech would have had to pay under the terms of Mr.
Ehrlich's current employment agreement.
"After intense internal discussion and a thorough review, we
have concluded that our business requires us to make a strategic
shift away from our Iron Flow Storage technology, which, while
highly promising, would require too much additional capital to
warrant further development," said Steven
Esses, President and CEO of Arotech. "While we believe that
the technology has great potential, our commitment to enhance
shareholder value has led us to the conclusion that investments to
further develop our organic growth efforts and strengthen our
operating business in the near- to mid-term provide us with a
higher return on invested capital and we cannot put additional
funds into such a long-range research and development project. In
the context of discontinuing this project, we have also reached an
amicable separation agreement with our former CEO and current Iron
Flow Storage project head Bob
Ehrlich, and we thank him once again for all of his many
contributions to Arotech throughout the years. Bob's personality
and leadership have been inestimably valuable to us; without him,
Arotech might not have survived some difficult times. We will miss
Bob, and we wish him every possible success in his future
endeavors."
About Arotech Corporation
Arotech Corporation is a leading provider of quality defense and
security products for the military, law enforcement and homeland
security markets, including multimedia interactive
simulators/trainers and advanced zinc-air and lithium batteries and
chargers. Arotech operates two major business divisions: Training
and Simulation, and Power Systems.
Arotech is incorporated in Delaware, with corporate offices in
Ann Arbor, Michigan, and research,
development and production subsidiaries in Michigan, South
Carolina, and Israel. For
more information on Arotech, please visit Arotech's website at
www.arotech.com.
Arotech Investor Relations Contacts:
Brett Maas / Rob Fink
Hayden IR
(646) 536.7331 / (646) 415.8972
ARTX@haydenir.com
Except for the historical information herein, the matters
discussed in this news release include forward-looking statements,
as defined in the Private Securities Litigation Reform Act of 1995.
Forward-looking statements reflect management's current knowledge,
assumptions, judgment and expectations regarding future performance
or events. Although management believes that the expectations
reflected in such statements are reasonable, readers are cautioned
not to place undue reliance on these forward-looking statements, as
they are subject to various risks and uncertainties that may cause
actual results to vary materially. These risks and uncertainties
include, but are not limited to, risks relating to: product and
technology development; the uncertainty of the market for Arotech's
products; changing economic conditions; delay, cancellation or
non-renewal, in whole or in part, of contracts or of purchase
orders (including as a result of budgetary cuts resulting from
automatic sequestration under the Budget Control Act of 2011); and
other risk factors detailed in Arotech's most recent Annual Report
on Form 10-K for the fiscal year ended December 31, 2015 and other filings with the
Securities and Exchange Commission. Arotech assumes no obligation
to update the information in this release. Reference to the
Company's website above does not constitute incorporation of any of
the information thereon into this press release.
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SOURCE Arotech Corporation