DENVER, Dec. 21, 2016 /PRNewswire/ - Intermap
(TSX: IMP), (ITMSF:BB), a leading geospatial intelligence
Corporation, today announced that it has entered into a series of
related arrangements with Vertex One Asset Management Inc., on
behalf of the Vertex Fund, ("Vertex"), its existing lender and
principal shareholder, that are intended to restructure Intermap's
outstanding indebtedness, reduce its interest and certain other
payment obligations, and provide the necessary working capital to
pursue Intermap's business objectives.
As part of these arrangements, Vertex has agreed to provide a
Standby Purchase Commitment to backstop the issuance of
US$6,000,000 of the Corporation's
common shares through an exempt Equity Rights Offering to all
existing shareholders (the "Rights Offering"). The proceeds from
the Rights Offering will be used to repay the Bridge Loan described
below. It is anticipated that the Rights Offering will be
completed during the first quarter of 2017.
In conjunction with its Standby Purchase Commitment, Vertex has
provided a new US$6,000,000 Bridge
Loan to fund general corporate purposes until the Rights Offering
is completed. The Bridge Loan will be repaid from the gross
proceeds of the Rights Offering (including proceeds received in
connection with the Standby Purchase Commitment). Any unpaid
amounts under the Bridge Loan, following the Rights Offering, if
any, will convert into a term loan with a maturity of September 1, 2020. The Bridge Loan is
non-interest bearing.
"We are extremely pleased that our primary lender and largest
shareholder, one of the stakeholders that knows Intermap best, has
provided equity financing and a strong vote of confidence",
commented Patrick Blott, Executive
Chairman and CEO of Intermap. "Vertex has agreed to make this
investment available to all our existing shareholders. It sends a
clear signal to our customers, partners, and employees that the
Corporation enjoys strong financial support from a sophisticated
and committed investor."
In conjunction with these new financings, Vertex has agreed to
restructure its existing indebtedness and provide funds, as
follows:
(1) Term Extension and Elimination of Interest on all
Existing Notes: amending the maturity dates to September 1, 2020 and eliminating the obligation
to pay interest in respect of two promissory notes (the "Amended
Notes") issued by the Corporation to Vertex in the principal
amounts of (i) US$2,000,000 due on
the earlier of July 8, 2017 and the
date on which the Corporation receives a down payment from a
geospatial project (the "Amended July
2016 Note"), and (ii) US$25,800,000 due September 1, 2017 (the "Amended September 2016 Note");
(2) Termination of the Royalty and Cash Sweep:
terminating a royalty interest equal to 17.5% of the net revenues
of the Corporation (the "Royalty") and eliminating the
Corporation's obligation to maintain a cash sweep account to
restrict a certain portion of the Corporation's cash collections
from net revenues (the "Cash Sweep") for repayment of the
promissory notes owing to Vertex (the "Royalty and Cash Sweep
Termination Agreement"). As consideration for terminating
the Royalty and Cash Sweep, Intermap issued a non-interest bearing
note (the "New Dec 2016 Note")
maturing September 1, 2020, in the
principal amount of US$3,000,000;
(3) Provision of US$6,000,000
Bridge Financing: advancing US$6,000,000 to the Corporation as a bridge loan,
due on the earlier of March 31, 2017
and the completion of the Rights Offering and other transactions,
that result in gross proceeds to the Corporation in an amount no
less than US$6,000,000, (the
"Bridge Loan"). The Bridge Loan will be available to meet
the working capital requirements of the Corporation until the
Rights Offering is completed. The Bridge Loan is non-interest
bearing and any amounts which remain outstanding after the Rights
Offering will be converted into a term loan due September 1, 2020 (the "Term Loan");
and
(4) Provision of a US$6,000,000 Standby Purchase Commitment to
backstop the Rights Offering: providing a standby purchase
guarantee of up to US$6,000,000 in
respect of the Rights Offering ("Standby Guarantee").
The Amended July 2016 Note, the
Amended September 2016 Note, the
Royalty and Cash Sweep Termination Agreement, the New Dec 2016 Note, the Bridge Loan and, as
applicable, the Term Loan are hereinafter referred to as the
"Vertex Transactions".
The Vertex Transactions were unanimously approved by the Board
of Directors of Intermap. Each of the directors was determined to
be independent for the purposes of Multilateral Instrument 61-101
Protection of Minority Security Holders in Special
Transactions. After due consideration of the Vertex
Transactions and the other alternatives available to the
Corporation, the Board of Directors concluded that the Corporation
was in serious financial difficulty and the Vertex Transactions,
together with the Rights Offering and the Standby Purchase
Commitment, were designed to improve the financial position of the
Corporation and as such the Vertex Transactions were approved.
Funding in respect of the Bridge Loan was completed on December 21, 2016.
Following the Vertex Transactions, Intermap will have the
consolidated principal amount of Thirty-Six Million and Eight
Hundred Thousand United States Dollars (USD$36,800,000) due under its Bridge Loan and
Amended and New Notes held by Vertex.
About Intermap
Headquartered in Denver,
Colorado - Intermap (www.intermap.com) is an industry leader
in geospatial intelligence solutions. It is the only company
capable of fusing volumes of accurate bare earth and other
geospatial data into a single source to provide location-based
solutions for customers in diverse markets around the world.
Intermap Reader Advisory
Certain information provided in this news release constitutes
forward-looking statements, including the intention of the
Corporation to complete the Rights Offering. The words
"anticipate", "expect", "project", "estimate", "forecast" and
similar expressions are intended to identify such forward-looking
statements. Although Intermap believes that these statements are
based on information and assumptions which are current, reasonable
and complete, these statements are necessarily subject to a variety
of known and unknown risks and uncertainties. You can find a
discussion of such risks and uncertainties in our Annual
Information Form and other securities filings. While the
Corporation makes these forward-looking statements in good faith,
should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results may
vary significantly from those expected. Accordingly, no assurances
can be given that any of the events anticipated by the
forward-looking statements will transpire or occur, or if any of
them do so, what benefits that the Corporation will derive
therefrom. All subsequent forward-looking statements, whether
written or oral, attributable to Intermap or persons acting on its
behalf are expressly qualified in their entirety by these
cautionary statements. The forward-looking statements contained in
this news release are made as at the date of this news release and
the Corporation does not undertake any obligation to update
publicly or to revise any of the forward-looking statements made
herein, whether as a result of new information, future events or
otherwise, except as may be required by applicable securities
law.
SOURCE Intermap Technologies Corporation