AirIQ Inc.
TSX VENTURE : IQ.H

AirIQ Inc.

December 01, 2009 08:51 ET

AirIQ Announces Closing of Sale of U.S. Subsidiary, Boatracs Issuance of Shares pursuant to Private Placement

TORONTO, ONTARIO--(Marketwire - Dec. 1, 2009) – AirIQ Inc. ("AirIQ") (TSX VENTURE: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 locating, boundary notification, automated inventory reports, maintenance reminders, security alerts and vehicle disabling and unauthorized movement alerts. Management believes that AirIQ maintains a dominant market share in North America, in three segments, namely, rental vehicle fleets, regulated fisheries, and marine workboat markets. For additional information on AirIQ or its products and services, please visit the Company's website at www.airiq.com.

Forward-looking Statements

This news release contains forward-looking information based on management's best estimates and the current operating environment. These forward-looking statements are related to, but not limited to, AirIQ's operations, anticipated financial performance, business prospects and strategies. Forward-looking information typically contains statements with words such as "hope", "goal", "anticipate", "believe", "expect", "plan" or similar words suggesting future outcomes. These statements are based upon certain material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking statements, including AirIQ's perception of historical trends, current conditions and expected future developments as well as other factors management believes are appropriate in the circumstances. Such forward-looking statements are as of the date which such statement is made and are subject to a number of known and unknown risks, uncertainties and other factors, which could cause actual results or events to differ materially from future results expressed, anticipated or implied by such forward-looking statements. Such factors include, but are not limited to, changes in market and competition, technological and competitive developments and potential downturns in economic conditions generally. Therefore, actual outcomes may differ materially from those expressed in such forward-looking statements. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that such information may not be appropriate for other purposes. Other than as may be required by law, AirIQ disclaims any intention or obligation to update or revise any such forward-looking statements, whether as a result of such information, future events or otherwise.

For additional information on AirIQ or its products and services, please visit the Company's website at www.airiq.com.

Contact Information

  • AirIQ Inc.
    Donald Gibbs
    Chief Financial Officer
    (905) 831-6444, Ext. 4255
    dgibbs@airiq.com