ProStar Secures Insider-Led Lifeline to Fuel Ambitious Growth Targets

GRAND JUNCTION, CO – January 16, 2026 – Geospatial technology firm ProStar Holdings Inc. (TSXV: MAPS, OTCQX: MAPPF) today announced it has secured up to US$500,000 in financing through a private placement of secured convertible debentures. In a significant display of internal conviction, the entire offering is being subscribed by a single director of the company.

The capital infusion arrives at a pivotal moment for the developer of the PointMan® precision mapping solution. While ProStar has demonstrated promising top-line growth, with revenues climbing 21% to $1.00 million in 2024, it continues to operate at a substantial loss. Financial filings from late 2024 revealed a critically low cash balance of just $1,834, and auditors noted the company's ability to continue as a "going concern" is dependent on its ability to secure additional financing. This director-led deal provides a much-needed financial runway, but also underscores the pressures facing the growing tech firm.

A Director's High-Stakes Bet

The structure of the financing speaks volumes about the confidence—and risk—involved. A director of the company, whose name was not disclosed in the release but is widely believed to be CEO Page Tucker, is personally funding the entire debenture. This move is a powerful endorsement of ProStar’s strategy and future prospects, especially at a time when attracting external capital can be challenging for companies with ongoing losses.

This is not a casual investment. The debentures are secured by a first-ranking security interest over all present and after-acquired property and assets of ProStar. This means the director's investment is backed by the company's entire asset base, including its extensive intellectual property portfolio of 16 issued patents. Should the company falter, the director would be first in line among creditors, a position that signals a deep belief in the company's viability but also highlights the very real risk being undertaken.

Such insider-led financing rounds can be interpreted in two ways. On one hand, they demonstrate that those with the deepest insight into the company's operations are willing to invest their own capital, suggesting they see a clear path to profitability and a discounted valuation. On the other hand, it can sometimes indicate difficulty in securing funds from traditional venture capital or institutional investors, who may be more risk-averse given the company's current cash burn and negative equity.

Fueling the Future of Infrastructure Mapping

The proceeds from the offering are earmarked for "general corporate purposes," a broad term that, for ProStar, means funding the operational and sales-focused strategy it has recently adopted. The company has aggressively streamlined its operations, cutting overhead by as much as 40% year-over-year to pivot from a development-heavy organization to a sales-centric one. This new capital is the fuel required to execute that pivot.

ProStar's mission is to revolutionize how critical underground infrastructure is mapped and managed. Its flagship SaaS products, PointMan and the LinQD integration platform, serve a growing market that is undergoing a major digital transformation. The company has seen accelerating adoption, recently signing its 100th SaaS client and reporting a 900% year-over-year increase in new customer signings in the second quarter of 2024. Its client roster includes Fortune 500 corporations, major engineering firms, and U.S. Departments of Transportation.

This financing will allow ProStar to continue capitalizing on this momentum. It supports the sales and marketing efforts needed to onboard the next 100 clients, a goal the company aims to achieve in the next 12 months. Furthermore, it strengthens the company's ability to leverage its key strategic alliances with industry giants like Trimble, Topcon, and Radiodetection, whose hardware integrates with ProStar's software, creating a powerful ecosystem for market penetration.

Decoding the Deal's Performance-Tied Terms

A closer look at the debenture's terms reveals a structure intricately tied to the company's future performance. The debt carries a 12.5% annual interest rate, a rate reflective of the risk profile of a growth-stage company. The principal is convertible into units at a price of US$0.10 per unit. With ProStar's stock recently trading around CAD$0.13 (approximately US$0.096), the conversion price is set near the current market value, making conversion attractive if the stock holds its ground or appreciates.

Each unit consists of one common share and one-half of a warrant, with each whole warrant allowing the purchase of an additional share at US$0.14 within five years. This provides further upside for the investor if the company's strategy pays off and the stock price climbs.

The most compelling feature, however, is the automatic conversion trigger. The entire principal amount will automatically convert into units if ProStar achieves US$2,000,000 in booked Annual Recurring Revenue (ARR) in 2026, or US$2,500,000 in ARR in 2027. This provision effectively transforms the debt into equity based on hitting specific, aggressive sales milestones. It directly aligns the director’s financial outcome with the company's ability to scale its recurring revenue base, turning the investment into a direct bet on the success of its sales-centric pivot.

Achieving a $2 million ARR target in 2026, up from a total 2024 revenue of $1 million, is an ambitious goal. However, the company's recent acceleration in customer acquisition suggests it may be within reach if the momentum can be sustained with the help of this new capital.

Balancing Growth with Shareholder Value

For existing shareholders, any issuance of new shares brings the concern of dilution. If the full US$500,000 debenture is converted, it would create 5 million new common shares. The exercise of the associated 2.5 million warrants would add another 2.5 million shares. Based on ProStar's roughly 145 million shares outstanding as of late 2024, this represents a potential dilution of approximately 3.5% from the conversion, and about 5% on a fully diluted basis including the warrants.

While any dilution is a cost to current shareholders, it must be weighed against the alternative. Without this capital, the company's ability to operate and execute its growth plan was in question. This financing provides the necessary runway to pursue a strategy that could generate significant long-term value, potentially far outweighing the modest dilution. The market appears to have responded with cautious optimism, as the company's stock has trended upward by over 19% in the past month leading up to the announcement.

Ultimately, this insider-backed financing is a calculated risk for all parties. For the director, it's a significant personal investment secured against the company's assets. For the company, it's a critical lifeline to pursue its growth ambitions. For shareholders, it's a trade-off between immediate dilution and the potential for future growth, with the deal's success now explicitly and publicly tied to ProStar's ability to deliver on its revenue promises.