Spectra7 Announces Limited Waiver of Loan Facility

TORONTO, ONTARIO--(Marketwired - Dec. 20, 2017) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR RELEASE, PUBLICATION, DISTRIBUTION OR DISSEMINATION DIRECTLY, OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES

(TSX:SEV) Spectra7 Microsystems Inc. ("Spectra7" or the "Company"), a leading provider of high-performance analog semiconductor products for broadband connectivity markets announced today that it has entered into a limited waiver (the "Waiver") to its US$6,500,000 senior secured term loan facility with MidCap Financial (the "Loan Facility"). The Waiver, among other things and subject to the satisfaction of certain conditions set forth therein, (i) waives the applicable prepayment fee of 5% pursuant to the Loan Facility, and (ii) reduces the applicable exit fee in relation to the Loan Facility.

In consideration for entering into the Waiver, the lender under the Loan Facility has agreed, subject to the conditions set forth in the Waiver, to surrender to the Company for cancellation outstanding warrants to purchase up to 1,605,010 common shares in the capital of the Company ("Common Shares") and the Company has agreed to issue new warrants to purchase up to 2,205,010 Common Shares (the "Waiver Warrants") with each Waiver Warrant being exercisable until February 24, 2022 into one Common Share at an exercise price equal to the volume weighted average price of the Common Shares on the Toronto Stock Exchange for the 5 days preceding the issue date of the Waiver. The transactions contemplated by the Waiver are expected to occur on closing of the Offering (as defined below), and are subject to the approval of the Toronto Stock Exchange and the other conditions set forth therein.

The Company intends to use a portion of the net proceeds from the $15,000,000 bought deal public offering of units (the "Offering"), as previously announced on December 14, 2017, for the repayment of the Loan Facility. The closing of the Offering is scheduled to occur on or about January 9, 2018.

ABOUT SPECTRA7 MICROSYSTEMS INC.

Spectra7 Microsystems Inc. is a high performance analog semiconductor company delivering unprecedented bandwidth, speed and resolution to enable disruptive industrial design for leading electronics manufacturers in broadband connectivity markets. Spectra7 is based in San Jose, California with design centers in Markham, Ontario, Cork, Ireland, and Little Rock, Arkansas. For more information, please visit www.spectra7.com.

CAUTIONARY NOTES

Certain statements contained in this press release constitute "forward-looking statements". All statements other than statements of historical fact contained in this press release, including, without limitation, those regarding the Company's future financial position and results of operations, strategy, proposed acquisitions, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words "believe", "expect", "aim", "intend", "plan", "continue", "will", "may", "would", "anticipate", "estimate", "forecast", "predict", "project", "seek", "should" or similar expressions or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company's expectations, estimates and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company's annual MD&A for the year ended December 31, 2016. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law.