Clarocity increases StableView debt line to $6M

2017-02-21 12:24 ET - News Release

Mr. Shane Copeland reports

CLAROCITY CORPORATION ANNOUNCES AMENDED DEBT FACILITY

Clarocity Corp. has amended the previously announced (see Aug. 31, 2016, Sept. 22, 2016, and Jan. 23, 2017, press releases) debt facility provided by StableView Asset Management. The initial $4-million facility has been drawn down and the company and StableView have agreed to increase the amount available for drawdown to $6-million. The up-to-$2-million additional proceeds from the amended facility will be used to repay the outstanding promissory notes issued by the corporation as part of the Valued Veterans LLC acquisition and for general corporate purposes.

"Since the Valued Veterans acquisition, both companies have continued to streamline sales and operations," stated Shane Copeland, chief executive officer of Clarocity. "Our intent is to use this amended facility to repay the outstanding promissory note that was issued for the Valued Veterans acquisition. This eliminates the structural barriers of operating as separate entities, providing a unified focus on closing revenue opportunities in our pipeline."

"While the Valued Veterans drawdown is debt neutral, as we're shifting from the Valued Veterans promissory note to this facility, it allows Clarocity to accelerate integration as we prepare for business in the pipeline," said Dave Guebert, chief financial officer of Valuation Vision. "Our shareholders should be confident that this signals a strong focus that a more tightly integrated entity will also result in significant operational efficiencies."

Pursuant to the amended facility, Clarocity will issue up to an aggregate amount of $2-million in principal amount of debentures at a price of $1,000 per $1,000 principal amount of debentures. The debentures will bear an interest rate of 15 per cent per annum payable quarterly in cash or in common shares, at the option of StableView, subject to a reduction to 12 per cent per annum if all the company's debt ranking in priority to the debentures is fully repaid. The debentures will mature on Sept. 21, 2019. At any time on or after March 21, 2017, StableView may also, upon notice, require repayment of the outstanding debentures together with any accrued and/or unpaid interest. The debentures have been guaranteed by the company's wholly owned subsidiary, Valuation Vision Inc., and are secured against all of the company's and the guarantor's property and assets.

In addition, the company will issue that number of common share purchase warrants equal to 33 per cent of the additional proceeds divided by the exercise price of the warrants, being market price as determined under TSX Venture Exchange policy. Each warrant entitles the holder thereof to purchase one common share in the capital of the company at 13.5 cents per common share, exercisable for a period of 36 months from the date of issuance. The company will also issue 400,000 common shares for every $1-million advanced pursuant to the amended facility at a deemed price equal to the market price.

About Clarocity Corp.

Clarocity provides real estate valuation solutions and platform technologies designed to address today's dynamic housing market. The company's innovative platform is driving the next generation of valuation solutions such as MarketValue Pro (MVP) and BPOMerge and setting new standards in real estate valuation quality and reliability.

Everyday GSE, banking and investor clients rely on the company's proprietary solutions to value assets, finance loans and securitize portfolios. As a fully integrated technology and valuation services company, Clarocity provides a full spectrum of appraisal and alternative valuation solutions.

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