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Press release from CNW Group

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

Wednesday, February 23, 2011

Seprotech updates status of previously reported delay in filing of 2010 annual financial statements and first quarter 2011 interim financial statements18:11 EST Wednesday, February 23, 2011OTTAWA, 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.For further information: Mr. Matthew Anderson, Investor Relations Tel: (613) 523-1641 Fax: (613) 731-0851