VANCOUVER, Sept. 11, 2019 /CNW/ - UrtheCast Corp. (TSX:UR) ("UrtheCast" or the "Company"), a leading provider of information-rich products and services in the rapidly growing geospatial and geo-analytics markets, is pleased to announce the closing of a $6.6 million (US$5.0 million) financing (the "Financing") with Vine Rose Limited (the "Lender"), consisting of a senior unsecured convertible debenture of the Company in the principal amount of $2,979,538 (the "Convertible Debenture") and a senior unsecured non-convertible debenture of the Company in the principal amount of $3,620,462 (the "Debenture"). The Company also provides an update on its term loan with its Spanish lender.
$6.6 Million Financing
The Convertible Debenture accrues interest at a rate of 17% per annum, has a maturity date of October 31, 2019 and is convertible into common shares of the Company ("Common Shares") at the option of the Lender, at any time prior to the maturity date at a conversion price equal to $0.32 per Common Share (the "Original Conversion Price"). The Original Conversion Price is subject to adjustment in certain circumstances, including if the Company issues any Common Shares or securities convertible into Common Shares (other than pursuant to its equity incentive plan) at a lower price, in which case the conversion price shall be reduced to such lower price but not less than $0.24, subject to approval from the Toronto Stock Exchange.
The Debenture accrues interest at a rate of 17% per annum and also has a maturity date of October 31, 2019.
In connection with the Financing, the Company paid the Lender a 3% finance fee in the amount of US$150,000.
The proceeds of the Financing will be used primarily towards the partial satisfaction of the deferred consideration payable to Land O'Lakes, Inc. for the acquisition of Geosys, professional fees related to the expected financing of the UrtheDaily Constellation, and debt service costs.
UrtheCast Imaging, S.L.U., a wholly-owned subsidiary of UrtheCast, has agreed with Banco de Sabadell S.A., under its €25 million senior secured term loan dated December 11, 2015 (the "Sabadell Loan"), to further defer a previously negotiated principal repayment of €1.5 million from August 31, 2019 to September 30, 2019.
UrtheCast Corp. is a Vancouver-based company that serves the rapidly growing and evolving geospatial and geo-analytics markets with a wide range of information-rich products and services.
For more information, visit UrtheCast's website at www.urthecast.com.
Forward Looking Information
This release contains certain information which, as presented, constitutes "forward-looking information" within the meaning of applicable Canadian securities laws. Forward-looking information involves statements that relate to future events and often addresses expected future business and financial performance, containing words such as "plan" and "propose", statements that an action or event "may" or "will" be taken or occur, or other similar expressions and includes, but is not limited to, statements relating to: UrtheCast's expectations with respect to its ability to raise capital and to continue as a going concern; expectations regarding UrtheCast's ability to meet its obligations and satisfy its liabilities under its existing indebtedness and the Convertible Debenture and the Debenture; UrtheCast's expectations with respect to financing of the UrtheDaily Constellation; and UrtheCast's expectations with respect to repayment and/or deferral of the Sabadell Loan. Such statements reflect UrtheCast's current views with respect to future events, and are necessarily based upon a number of estimates and assumptions that, while considered reasonable by UrtheCast as at the date of this press release, are inherently subject to significant uncertainties and contingencies. Many factors could cause UrtheCast's actual results or performance to be materially different from expectations that may be expressed or implied by such forward-looking statements, including, among others: the Company's ability to rectify its current cash constraints and to continue as a going concern; the Company's ability to enter into alternative financing for the UrtheDaily satellite constellation, and any delays or failures in the design, development, construction, launch and operational commissioning of the such constellation; the Company's ability to comply with debt and repayment obligations and avoid the exercise of lenders' rights, including with respect to seizing secured assets and other rights available to lenders; the Company's inability to repay the Sabadell Loan; lower than expected revenues from the Company's products and services; the Company's ability to fund its future operations, which is contingent on its efforts to raise additional financing and/or sell certain assets of the Company; the Company's ability to successfully complete a sale or other transaction involving Deimos Imaging on commercially reasonable terms, or at all; loss, reduction in scope, termination, failure to satisfy conditions precedent or decline in general of the Company's agreements or relationships with its key partners, including Land O' Lakes, Inc.; and those factors and assumptions discussed in UrtheCast's Annual Information Form dated March 29, 2019, which is available under UrtheCast's SEDAR profile at www.sedar.com. UrtheCast cautions readers that such factors and uncertainties are not exhaustive and that should certain risks or uncertainties materialize, or should underlying estimates or assumptions prove incorrect, actual results, performance or achievements may vary significantly from those expected. UrtheCast undertakes no obligation to update forward-looking statements except as required by Canadian securities laws. Readers are cautioned against attributing undue certainty to forward-looking statements.
SOURCE UrtheCast Corp.
For further information: Sai Chu, Chief Financial Officer, +1 (604) 669-1788