Defects in the Company's 3DBI software applications, delays in delivery, and failures or mistakes in the Company's software code could materially harm the Company's business, including customer relationships and operating results.
Information Technology Security
The Company's 3DBI software applications are dependent on the Company's ability to protect its computer equipment and the information stored in the Company's data centers against damage that may be caused by fire, power loss, telecommunication failures, unauthorized intrusion, computer viruses, disabling devices and other similar events. A failure in the Company's production systems or a disaster or other event affecting production systems or business operations, both internally and externally, could result in a disruption to the Company's software services. Such a disruption could also impact the Company's reputation and cause it to lose customers, revenue, face litigation, or necessitate customer service/repair work that would involve substantial costs and could ultimately have a material impact on the Company.
Breakdown of Strategic Alliances
Intermap has fostered a number of key alliances over the past several years and intends to enter into new alliances in the future. These alliances occasionally take the form of performing contract services in tandem with, or as a sub-contractor to, another geographic information systems (GIS) company. The Company believes these new alliances will help enable access to significant scalable markets that would not otherwise be accessible in a timely manner. The breakdown or termination of some or all of those alliances could have a material impact on the Company. At this time, the Company is not aware of any material issues in its strategic relationships. Should any one of these companies be unable to continue its alliance with Intermap, or otherwise choose to dissolve the relationship, the Company would seek to replace the connection with other entities, but there is no guarantee such replacement would occur.
Exporting Products – Political Considerations
Intermap's data collection systems contain technology that is classified as a defense article under the International Traffic and Arms Regulations. All IFSAR data collection efforts undertaken outside the United States, therefore, constitute a temporary export of a defense article, requiring prior written approval by the United States Department of State for each country within which data collection operations are to be performed. The Company does not currently anticipate that requirements for export permits will have a material impact on the Company's operations, although either government policy or government relations with select foreign countries may change to the point of affecting the Company's operational opportunities. The data produced by Intermap's IFSAR radar system falls under Department of Commerce regulations and is virtually unrestricted.
A significant portion of Intermap's revenue is expected to come from customers outside of the United States and is therefore subject to additional risks, including foreign currency exchange rate fluctuations, agreements that may be difficult to enforce, receivables difficult to collect through a foreign country's legal system, and the imposition of foreign-country-imposed withholding taxes or other foreign taxes. Intermap relies on contract prepayments or letters of credit to secure payment from certain of its customers when deemed necessary. The Company has in the past secured export credit insurance on certain of its international receivables, which greatly reduces the commercial and political risks of operating outside of North America.
Intermap understands that not every region enjoys the political stability that is taken for granted in North America. Developments in recent years in the Middle East, Asia, and other parts of the world illustrate this clearly. Political or significant instability in a region where Intermap is conducting data collection activities and any of its other services, or where Intermap has clients, could adversely impact Intermap's business.
SOURCE Intermap Technologies Corporation
|Intermap Technologies Corporation
Intermap Technologies, Rich Mohr, Senior Vice-President & Chief Financial Officer
Email Contact +1 (303) 708-0955; Canada - Financial, Cory Pala, Investor Relations, e.vestor Communications Inc.
Email Contact +1 (416) 657-2400