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  • Pason to Appeal Decision from

  • Canadian Court in

  • AutoDriller Litigation

FOR IMMEDIATE RELEASE

CALGARY, Alberta (July 9, 2013) – Following up on its July 5, 2013 press release, Pason Systems Inc. (TSX: PSI) (“Pason” or the “Company”) announced today that it will be filing an appeal with the Canadian Federal Court of Appeal of the judgment released by the Federal Court of Canada, Trial Division, on July 5, 2013 regarding the Company’s AutoDriller product (the “AutoDriller”). After reviewing the lengthy and complex judgment, management has decided to pursue several issues on appeal, including the damages calculations endorsed by the Trial Judge.

For further clarification, the damages set out in the judgment ($52.9 million) are based upon revenue earned from the AutoDriller in Canada and international countries, other than the United States, from the product’s inception in 2003 until September 2010 (the date that the financial reports used at trial were prepared). In addition to that time period, the Court found that the Plaintiff is entitled to damages based upon revenue Pason earned from the AutoDriller after September 2010 through to the expiration of the plaintiff’s patent on April 19, 2013. The extent of revenue earned from the AutoDriller in Canada and internationally, other than from the United States, during that time period and resulting damages will be determined on further application to the Trial Judge and be subject to appeals.

Pason expects numerous other post-judgment applications to be made to the Trial Court prior to the appeal, including motions to determine the amount of interest and court costs, all of which are also subject to appeals.

The Company continues to await a judgment from the US Court of Appeals for the Federal Circuit regarding the Colorado case, and is preparing its defense in the Texas case which is still in the preliminary stages.

As at March 31, 2013, the Company had reserved $53.1 million in its consolidated financial statements for the three AutoDriller cases described above. In light of the recent judgment in the Canadian case and Pason’s decision to appeal that judgment, the reserve will be adjusted and disclosed in the Company’s consolidated financial statements for the period ending June 30, 2013.

Pason Systems Inc.
Pason Systems Inc. is a leading provider of instrumentation systems to land-based and offshore drilling rigs worldwide. The company’s rental solutions, which include data acquisition, wellsite reporting, remote communications, and web-based information management, maximize rig uptime, improve work efficiency, and minimize operating costs. Pason’s common shares trade on the Toronto Stock Exchange under the symbol PSI.

For more information about Pason Systems Inc., visit the company’s website at www.pason.com or contact:

Marcel Kessler
President and CEO
403-301-3400

David Elliott
Chief Financial Officer
403-301-3441

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