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Quest Solution Announces $15 Million in Debt Reduction; Achieves Pivotal Turnaround Milestones

Balance Sheet Transformation Complements Improved Operating Performance and Positions Quest for Enhanced Profitability

$3 Million Annual Operating Cost Reductions to Date Including ~ 30% Headcount Reduction

Maximum Potential Converted Number of Shares for the $15M Debt Reduction Total Less than 15% of Issued Shares; Dramatically Improves Shareholders’ Equity

EUGENE, Ore., March 12, 2018 (GLOBE NEWSWIRE) — Quest Solution, Inc. (OTCQB:QUES), a specialty systems integrator offering field and supply chain technology solutions, announced agreements with certain noteholders that resulted in a reduction of the Company’s debt liability to such creditors from $17.4 million to $2.1 million.

Shai Lustgarten, Quest’s CEO, stated, “We have made dramatic progress toward the main strategic goals new management identified in our August 7, 2017, press release. The efficiency measures we have taken and this debt reduction have transformed the Company’s financial strength and significantly enhanced our balance sheet, improving stockholders’ equity, cash flow and all of our financial ratios.  The achievements to date have created nothing short of a rebirth of the Company for our employees and shareholders.”

Mr. Lustgarten continued, “When the new management team took control approximately one year ago, we inherited an essentially broken business including a very weak balance sheet and an operation that generated losses. Our top priorities since coming on board have been to deliver profitable operations and to negotiate a refinancing of the debt, combined efforts that enable us to build significant long-term shareholder value. We can now move forward with more efficient operations, modest interest expense and a balance sheet that can support the success we are driving in the business. I would like to thank the note holders for seeing the opportunity to unlock potentially significant value by aligning with the Company and its equity holders.”

Financial details of the refinancing are as follows (investors should also review the Company’s Form 8-K filed on March 1, 2018, which discloses information related to the debt restructuring including the actual agreements related thereto):

Total debt to the noteholders before settlement: $ 17,437,799
Total debt to noteholders post settlement agreement: $ 2,130,000
Total debt reduction:  $ 15,307,799
Interest per year
For Old debt ~ $600,000
Settlement interest on new issued C preferred ~ $97,000
Saving on interest  ~$503,000
Non cash and Equity
Total common stock issued: 500,000
Total Series C preferred stock issued (Convertible at $1.00) 1,711,000
Total warrants issued with exercise price at $0.20 3,000,000

Mr. Lustgarten continued, “In addition to improving the balance sheet, it is important to note that we have made substantial progress executing on the turnaround initiatives we previously outlined.  Among the key priorities that we set forth and have taken meaningful steps toward accomplishing are:

  • Delivering sustained profitability by realizing efficiencies;
  • Improving performance by changing company culture, motivating employees and consolidating operations; and
  • Adding new advanced technologies to our product offering, positioning Quest as a high-tech company with unique solutions, generating higher margins and stronger market position.

“Our business segment is exciting and includes potential integration of Artificial Intelligence Systems to revolutionize the supply chain and logistics management tasks. We are currently working on adding new technologies that will differentiate Quest from its competitors providing unique advanced solutions, increasing our margins and accelerating our growth.”

Mr. Lustgarten concluded: “We have made significant progress, and while there’s still a lot of work to be done, with the completion of a major part of our turnaround initiatives, Quest is better positioned today to capitalize on the opportunities we’re seeing in our evolving and growing target markets. We continue to provide solutions for the supply chain needs of our blue chip customer base of Fortune 100 companies and look forward to broadening our customer reach. Our new management team continues to focus on the development of new and enhanced solutions, with a particular focus on offering higher margin software solutions and services. Additionally, we remain dedicated to creating a successful and profitable leading company in the evolving markets in which we operate.”

About Quest Solution, Inc.
Quest Solution is a Specialty Systems Integrator and software developer that delivers innovative Field and Supply Chain technology solutions. We are also a manufacturer and reseller of consumables (labels, tags, and ribbons), RFID solutions, and barcode printers. Founded in 1994, Quest is headquartered in Eugene, Oregon, with offices in the United States.

Rated in the Top 1% of global solution providers, Quest specializes in the design, deployment and management of enterprise mobility solutions including Automatic Identification and Data Capture (AIDC), Mobile Cloud Analytics, RFID (Radio Frequency Identification), and proprietary Mobility software. Our mobility products and services offering is designed to identify, track, trace, share and connect data to enterprise systems such as CRM or ERP solutions. Our customers are leading Fortune 100 companies from several sectors including manufacturing, retail, distribution, food / beverage, transportation and logistics, health care and chemicals / gas / oil.

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