DENVER, Dec. 21, 2016 /CNW/ - 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
