GeoSentric Oyj - Company Announcement

FUNDING UPDATE, STATUS OF FUNDING TO SECURE THE COMPANY’S FUNDING NEEDS THROUGH 2013

GEOSENTRIC OYJ    STOCK EXCHANGE RELEASE December 4, 2012 at 10:30





FUNDING UPDATE, STATUS OF FUNDING TO SECURE THE COMPANY'S FUNDING NEEDS THROUGH
2013 





As previously announced on November 8, 2012, the Company has received the full
amount (€350,000) of its current secured loan and has sufficient cash for
operations into Q1 2013. As further announced on November 6, 2012 the Company
is exploring all options available to it to ensure that it has sufficient
liquidity to secure its operations through 2013 and possibly beyond, and its
other funding needs including repayment of the current secured loan note and
raising required funds to participate in the upcoming funding round of
GeoSolutions Holding N.V. (”GHNV”). And as further announced on 14 November
2012, the Board had resolved to issue a new secured interest-bearing loan note. 



Subsequently, the Board wrote to its known major shareholders seeking to raise,
through this instrument, a minimum of €1,000,000, and potentially up to
€1,550,000, depending on investor appetite. The proposed note would use the
currently approximately 24% equity investment that the Company holds in GHNV as
security. The schedule for this offer required the offering to be closed and
the subscribed Loan Notes be paid to the bank account of the Company on or
before 21 December 2012. 



The Company now reports that it has not yet received any investment
commitments. The Company will continue to hold the offering open until December
21, 2012 and the Board will again contact the known major shareholders and
request urgent feedback from them to indicate if there are other terms or
instruments that may be more acceptable or attractive to investors to enable
the Company to secure the required funding. In the absence of identifying any
viable alternatives, the Board would be left with no choice other than to seek
an orderly disposal of the Company's assets (which comprise almost entirely of
its 24% equity investment in GHNV), which ultimately could lead to a winding up
of the Company. Given the current secured loan and related pledge on the
Company's shares of GHNV, this is likely to lead to equity shareholders
receiving no final capital distribution on a winding up. 



Meanwhile, the Board continues to retain and pursue, where appropriate, all
realistic strategic options open to it in order to raise the necessary finance
including another directed share offering, further cost cutting measures where
possible, asset sales and other possible sources of external finance. If the
Company does not succeed in raising the required additional funding, it may
lose all or part of its holding in GHNV either as a result of realization of
the pledge on the current secured loan or further dilution from the other
shareholders' investment in GHNV based on the cash call. 







GEOSENTRIC OYJ



Board of Directors



Distribution:

NASDAQ OMX Helsinki

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