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Boatracs Sale Completed
1/26/2010 3:26:37 PM
AirIQ Announces Closing of Sale of U.S. Subsidiary, Boatracs Issuance of Shares pursuant to Private Placement
Toronto, Ontario – December 1, 2009 – AirIQ Inc. (“AirIQ”) (NEX: IQ.H), a leader in Wireless Location-Based Services, specializing in Telematics, today announced the closing of the sale of its U.S. subsidiary, AirIQ Marine, Inc. (“AirIQ Marine”) to Boatracs Inc. (“Boatracs”), a Delaware Corporation controlled by Mosaic Capital Partners L.P. (“Mosaic”), and the issuance of 13,333,333 shares and 5,333,333 common share purchase warrants of AirIQ to Mosaic pursuant to a private placement. Pursuant to the terms of a share purchase agreement between AirIQ, AirIQ U.S. Holdings, Inc. (“AirIQ US”) and Boatracs (the “Agreement”), AirIQ, through its wholly-owned subsidiary, AirIQ US sold all of the issued and outstanding shares of AirIQ Marine to Boatracs for gross proceeds of CDN$2,650,000. As part of the transaction, AirIQ has agreed to provide client care support and other transition services to Boatracs for a term of up to six months following closing. The parties also entered into an escrow agreement whereby CDN$400,000 of the proceeds have been placed in escrow to cover certain obligations related to the transactions.
In addition, AirIQ has closed a private placement with Mosaic, the terms of which were previously announced on November 13, 2009. In connection with that closing, AirIQ today issued 13,333,333 Units to Mosaic at a price of $0.015 per Unit for gross proceeds of CDN$200,000. Each Unit is comprised of one newly issued common share of AirIQ and four tenths (0.4) of one share purchase warrant. The issuance of the 13,333,333 AirIQ common shares and 5,333,333 common share purchase warrants has been approved by the NEX and the shares and warrants have been issued to Mosaic today, subject to the customary statutory hold period of four months. The warrants are exercisable for a term of one year from the date of grant (subject to adjustment in certain circumstances) and the exercise price is $0.05 per warrant.
As a consequence of the divesture and the reduced activities in the U.S. related to the marine marketplace, Stephen R. Willey has stepped down as President and Chief Executive Officer of AirIQ and its various subsidiaries; however he has agreed to remain on the Board.
AirIQ is also pleased to announce that in connection with the foregoing transactions, Mr. Vernon Lobo, managing director of Mosaic, will be appointed to the Board of Directors of AirIQ.
The proceeds from the transactions will be used to repay the Company’s outstanding secured loans with its term loan lenders and for general working capital.
About Mosaic
Mosaic Capital Partners is a private equity firm focused on providing capital, strategic advice and access to an extensive network to add value to small and medium sized enterprises. The firm partners with management and has investments in a number of fast growing businesses in Canada and the US.
About AirIQ
AirIQ trades on the NEX, a separate board of the TSX Venture Exchange under the symbol IQ.H. A leader in Wireless Location Services specializing in Telematics, AirIQ has offices in Pickering, Ontario, Canada, and in San Diego, California, United States. The Company offers a suite of location based services (LBS) under a ‘software as a service’ (SaaS) model that yields recurring revenues for each device deployed. AirIQ delivers services to three primary markets: Commercial Fleets; dealers that service Consumer segments; and Marine Fleets (fisheries and workboat). AirIQ provides vehicle and vessel owners with the ability to monitor, manage and protect their mobile assets. Services include: instant vehicle locatin
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