Just to address a couple of your points re LRL . The CRA debt is not $220K but actually $157K as can be seen here from the MD&A.....This dates back to 2012/2013 and will be settled by end of 2015 as per agreement with CRA made at the time.
During the twelve month period, July 1, 2012 through June 30, 2013, Western Interlok Systems, Ltd., a subsidiary of the Company, incurred $333,081 debt with the Canada Revenue Agency (CRA). Directors of the Company met with a representative of the CRA in May 2013 and were advised to keep current with all source deduction remittances and GST tax remittances. The Directors were asked to come back at a later date with a payment plan that would satisfy the arrears owing to the CRA. In October 2013, a Director of the Company met with a representative of the CRA and presented a business plan for November 2013 through December 2014, showing the arrears owing would be paid to CRA in installments starting in March 2014 to the end of 2015. The Company was advised again to keep current with source deduction payments and GST tax remittances in the forward period. As at April 30, 2015, the balance owing to CRA is $157,871
As to IBH having patented intellectual property LRL also has patented IP and have just applied for a third patent involving their engineered beams. LRL informed me that they now have a process which allows them to make the longest engineered beams in the industry on top of the patents mentioned below in their MD&A....
Thirdly, the Company manufactures products for use in residential construction. The Company manufactures and markets its patented IBS 2000® and patent pending IBS3000™ floor engineered bridging. The Company has spent years analyzing wood-frame floor construction, establishing itself as a leading authority in wood floor performance engineering. The Company also manufactures other building components, architectural wood products and offers various custom wood cutting services.
Something that was not mentioned is the fact that LRL ran at a 32% Gross profit last quarter while IBH is running at 18% GP. That 14% difference in GP is a very big deal and just that 14% extra GP would mean that LRL would make enough on Aprils sales alone to clear the CRA debt. Its important to keep things in perspective. LRL tells me they really believe they can get to a 40% Gross profit level and they have the flexibility to do that. I dont think IBH , keeping in mind the competitiveness of residential sheeting market, has the ability to garner any more GP points from their product.
There are countless ways to make a wood product fire resistant and if the market warrants it you can bet that another company will bring a sheeting product to market to compete with IBH. Subtle changes to a production method can allow for issuance of a new patent. It seems LP already manufactures a fire resistant sheathing so curious why they would look at IBH....
LP® FlameBlock® Fire-Rated OSB Sheathing combines fire resistance and structural performance in a single panel. Advantages include:
- Fire Resistance: A unique combination of flame-spread resistance and burn-through resistance, it’s a code compliant component of 1-hour and 2-hour fire-rated interior and exterior wall assemblies and roof decks.
- Strength: Carries full design values for load/span and shear as untreated wood structural panels.
- Protection: 15-minute thermal barrier (UBC 26-2).
http://lpcorp.com/products/panels/lp-flameblock-fire-rated-osb-sheathing/
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