Mr. Ute Koessler reports

IMPERUS TECHNOLOGIES CORP. EXECUTES AGREEMENT TO PURCHASE SOCIAL GAME DEVELOPER DIWIP LTD. FOR UP TO US$100 MILLION

Imperus Technologies Corp. has executed a share purchase agreement dated Oct. 14, 2014, with Diwip Ltd. and its shareholders, pursuant to which Imperus will acquire all of the issued and outstanding shares of Diwip.

Completion of the transaction is subject to a number of conditions, including, among other things, the approval of the TSX Venture Exchange and, if required, the approval of the shareholders of Imperus.

Diwip transaction highlights include the following:

• Diwip is an independent supplier of proprietary software, a leader in its field with approximately 24 million registered customers.
• Diwip is a consistent supplier of highly ranked games to Facebook, iOS, Android and other social networks.
• Diwip increased revenues from approximately $7.8-million (U.S.) in 2011 to $28.3-million (U.S.) in 2013. Diwip generated approximately $14.7-million (U.S.) of EBITDA (earnings before interest, taxes, depreciation and amortization) in 2013.
• The closing purchase price (as defined below) for Diwip is $50-million (U.S.), as well as earn-out payments (as defined below) of up to $50-million (U.S.) over two years after closing depending on the achievement of certain financial targets. Diwip's senior management/founders are highly incentivized through earn-out-payment provisions tied directly to Diwip's financial results. Imperus will acquire the entire share capital of Diwip, and will retain Diwip's senior management/founders and approximately 50-plus employees.
• The transaction will provide Imperus immediate access to the United States and other markets. Diwip has customers in approximately 220 countries, with the top five (by revenue) as at June 30, 2014, being the U.S., Canada, Australia, Great Britain and France.
• Diwip has invested in the development of a complete suite of mobile games, expected to be ready for deployment in the first quarter of 2015.

About Diwip

Diwip, a private software company based in Tel Aviv, Israel, is a developer of social and mobile gaming for PC, Mac, iOS and Android platforms.

Diwip is involved in the business of constructing a social gaming experience consisting of a full suite of attractive and compelling casino-themed games -- including slots, bingo, Texas hold'em poker, roulette, blackjack and video poker -- under the Best Casino and Slots Club brands. Diwip designs, develops and distributes its social casino-themed games within on-line social networks (such as Facebook) and mobile platforms (such as Android or iPhone). All of Diwip's games are free to play, and Diwip generates revenue through the in-game sale of virtual goods and advertising.

Diwip was incorporated on Oct. 3, 2010, under the laws of Israel. Its head and registered office is located in Tel Aviv, Israel. As of the date hereof, Diwip has 200 ordinary shares issued and outstanding, which are held equally by its two founders, Ehud Kantzuker and Yaniv Gamzo. Mr. Kantzuker is a director, co-chief executive officer and chief product officer of Diwip, and Mr. Gamzo is a director, co-CEO and chief technical officer of Diwip. There are no other directors or senior officers of Diwip. Biographical information about Mr. Kantzuker and Mr. Gamzo is set out below under "management and directors after completion of the transaction."

The transaction

The following is a summary of the transaction, and certain terms and conditions contained in the agreement. The agreement may be viewed on Imperus's SEDAR profile.

Pursuant to the transaction, Imperus will acquire, either directly or indirectly through a wholly owned subsidiary, all of the issued and outstanding shares of Diwip. As consideration for the purchased shares, Imperus will pay the Diwip principals a closing purchase price of $50-million (U.S.), as well as a contingent earn-out payment of up to $50-million (U.S.), as further described below.

The closing purchase price is payable on the closing of the transaction, as follows: (a) $40-million (U.S.) shall be paid in cash and (b) $10-million (U.S.) shall be satisfied by the issuance of common shares of Imperus. The common shares issuable at the closing of the transaction are to be issued at a price per share that is equal to the volume-weighted average price of the common shares on the exchange for a period of 30 consecutive trading days ending on the third trading day prior to the closing date, provided that if trading in the common shares is halted during the trading period, which halt remains in effect for seven or more trading days (whether consecutive or not) during the trading period, the common shares will be issued at an issue price equivalent to the issue price per security offered under the financing (as defined below), all subject to the requirements of the exchange. The closing purchase price is subject to a working capital adjustment typical of transactions of this nature.

In addition to the closing purchase price, as further consideration for the purchased shares, the Diwip principals are entitled to earn-out payments upon the achievement of certain financial milestones, as follows: (a) a payment of $12.5-million (U.S.), payable within 60 days after the first anniversary of the closing date, which amount may be increased to $25-million (U.S.) or decreased to nil should an agreed-upon multiple of annualized revenue and annualized EBITDA of Diwip in the first year after closing be above or below a target milestone; and (b) a payment of $12.5-million (U.S.), payable within 60 days after the second anniversary of the closing date, which amount may be increased to $25-million (U.S.) or decreased to nil should an agreed-upon multiple of annualized revenue and annualized EBITDA of Diwip in the second year after closing be above or below a target milestone.

All earn-out payments will be paid in cash and common shares at a 4:1 ratio. The common shares issuable in respect of the earn-out payments are issuable at a price per common share that is equal to the greater of the 30-day VWAP ending on the third trading day prior to the applicable payment of the earn out and 53 cents (or such higher price as may be required by the exchange).

In the event that Imperus does not pay all or any portion of the earn-out payments to a Diwip principal when due under the terms of the agreement, such unpaid amount will be deemed to be extended as a loan by such Diwip principal to Imperus. The outstanding amount under such loan will bear interest at the rate of 20 per cent per annum until repaid, with a term expiring 60 days after the earn-out due date (or earlier in certain circumstances). After such 60-day period (or in certain circumstances earlier), such Diwip principal may initiate collection proceedings of the amount that is due (plus accrued interest) and may, at its option, for a period of 18 months thereafter, convert any outstanding principal and interest under such loan into common shares at a conversion price equal to the greater of the 30-day VWAP ending three trading days prior to the conversion and the minimum issue price (or such higher price as may be required by the exchange).

The agreement contains customary representations, warranties, covenants, indemnities, non-solicitation covenants and other ancillary agreements that are appropriate for transactions of this nature. The agreement may be terminated and the transaction not consummated in certain circumstances: (a) by mutual consent of the parties; (b) by either party if the transaction has not been completed by Dec. 14, 2014 (subject to an extension of up to 14 days in certain circumstances); (c) by either party if a condition to closing in such party's favour is not satisfied (or waived, if capable of waiver) on or before the closing date; and (d) by Imperus if there has been a breach of the representations of any of the Diwip principals in certain circumstances.

Although the issue price for the common shares issuable to the Diwip principals is not known at this time, for purposes of this press release, assuming an issue price of 57 cents (being the last closing market price prior to this release), the Diwip principals are expected to collectively receive approximately 17,543,859 common shares at closing of the transaction, representing approximately 23.5 per cent of the issued and outstanding common shares of Imperus on the closing of the transaction, without making any adjustments for conversion from U.S. dollars to Canadian dollars, without taking into effect the financing and without taking into account common shares issuable pursuant to the earn-out payments, if any.

Conditions to completion of the transaction

There is no assurance that Imperus will consummate the transaction. Completion of the transaction is subject to a number of conditions, including, among others: (i) exchange approval and any other regulatory approval that may be required; (ii) approval from the shareholders of Imperus, if required; and (iii) completion of the financing. If such conditions are not satisfied or waived (if capable of waiver) on or before the closing deadline (unless extended), the agreement may be terminated.

Imperus shareholder approval

If shareholder approval is required, an Imperus special shareholders meeting is expected to be held to approve the transaction and certain other matters. It is expected that a management information circular containing detailed information on the transaction will be sent to Imperus shareholders in the coming months.

Financing

In conjunction with, and as a condition of completion of, the transaction, Imperus plans to carry out an equity and/or debt offering to raise gross proceeds of $60-million, or such other amount as Imperus determines. The gross proceeds will be used principally to satisfy the cash portion of the closing purchase price and the expenses relating to the transaction, as well as for general working capital purposes. The terms and conditions of the financing will be determined by Imperus in the context of the market, details of which will be set out in a subsequent news release and in the management information circular (or such other disclosure document as may be prepared in connection with the transaction in accordance with the requirements of the exchange).

Business of Imperus and Diwip after completion of the transaction

Should the transaction be completed, Diwip will become a wholly owned (direct or indirect) subsidiary of Imperus, and Imperus will continue to operate the Diwip business through such subsidiary, as well as continue to operate Imperus's other existing business lines.

Management and directors after completion of the transaction

It is not expected that the transaction will result in any change to the management or board of directors of Imperus.

On closing of the transaction, the Diwip principals will resign from their positions as directors of Diwip and will continue in senior officer roles with Diwip, as follows: Mr. Kantzuker as co-president and chief product officer of Diwip, and Mr. Gamzo as co-president and chief technical officer of Diwip. The directors of Diwip on closing of the transaction will be appointed by Imperus and have not been identified at this time.

The following information about Mr. Kantzuker and Mr. Gamzo is provided for information purposes only. Additional disclosure will be contained in the management information circular (or such other disclosure document as may be prepared in connection with the transaction in accordance with the requirements of the exchange).

Mr. Kantzuker is the co-founder of Diwip and is a resident of Tel Aviv, Israel. He has served as the co-CEO of Diwip since April, 2013, and as CPO of Diwip since the incorporation of Diwip in 2010, and he is primarily responsible for content and the product road map at Diwip. Mr. Kantzuker obtained a degree in software engineering from Tel-Aviv Afeka College for Engineering in 2010. From 2008 to 2010, Mr. Kantzuker was a software engineer in a private software start-up company involved in the business of optimization and development of algorithms.

Mr. Gamzo is the co-founder of Diwip and is a resident of Tel Aviv, Israel. He has served as the co-CEO of Diwip since April, 2013, and as CTO of Diwip since the incorporation of Diwip in 2010, and he is primarily responsible for managing Diwip's system infrastructure and directing Diwip's mobile efforts. Mr. Gamzo obtained a degree in software engineering from Tel-Aviv Afeka College for Engineering in 2008 and has held roles as a software engineer with several large companies. From 2008 to 2010, Mr. Gamzo was a software engineer with NICE Actimize, a public company that provides financial crime, risk and compliance solutions for regional and global financial institutions, and government regulators. Prior thereto, Mr. Gamzo was involved with several large companies, including AOL-ICQ.

Selected financial information regarding Diwip

For the year ended Dec. 31, 2013, Diwip had total assets of $13,195,828 (U.S.), total liabilities of $13,310,746 (U.S.), revenues of $28,347,695 (U.S.) and net profit for the year of $12,888,630 (U.S.) based on audited financial statements prepared in accordance with international financial reporting standards.

For the six-month period ended June 30, 2014, Diwip had total assets of $5,391,235 (U.S.), total liabilities of $708,026 (U.S.), revenues of $12,336,722 (U.S.) and net profit for the period of $4,798,127 (U.S.) based on unaudited financial statements prepared in accordance with international financial reporting standards.

It is expected that the management information circular (or such other disclosure document as may be prepared in connection with the transaction in accordance with the requirements of the exchange) will contain the audited financial statements of Diwip for the years ended Dec. 31, 2013, 2012 and 2011, the unaudited interim financial statements of Diwip for the six-month period ended June 30, 2014, and pro forma financial statements as may be required by the policies of the exchange.

The financial statements of Imperus may be viewed on SEDAR.

"We are very excited about this transaction, and the tremendous value it brings to both parties and their shareholders," said Daniel Kajouie, president and CEO of Imperus. Mr. Kajouie went on to say: "The acquisition of Diwip provides Imperus immediate access to a broad market base. Diwip's proprietary on-line social gaming and mobile gaming products are synergistic with the Imperus product line and our philosophies. Mr. Gamzo and Mr. Kantuzker have built a great company to date, and we are thrilled to have them join our team with a common vision of building Imperus to great new heights."

We seek Safe Harbor.