URTHECAST CORP.

ANNUAL INFORMATION FORM

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2016

March 27, 2017

TABLE OF CONTENTS

GENERAL MATTERS AND FORWARD-LOOKING STATEMENTS ...... 1 Forward-Looking Statements ...... 1 CORPORATE STRUCTURE ...... 4 Name, Address and Incorporation ...... 4 Intercorporate Relationships ...... 5 GENERAL DEVELOPMENT OF THE BUSINESS ...... 5 Three Year History ...... 6 DESCRIPTION OF THE BUSINESS ...... 11 General ...... 11 Products and Services ...... 12 Market ...... 13 Distribution – EO Data Sales ...... 15 Marketing Plan and Strategy ...... 15 Monetization and Pricing ...... 15 Specialized Skill and Knowledge ...... 16 Competitive Conditions ...... 16 Strategic Relationships ...... 17 Components ...... 18 Intellectual Property ...... 18 Economic Dependence ...... 19 Employees ...... 19 Foreign Operations ...... 20 RISK FACTORS ...... 20 Risks Related to the Operation of the Deimos-1 and Deimos-2 Satellites and the Expected Operation of the OptiSAR Constellation and the UrtheDaily Constellation ...... 20 Risks Related to the PanGeo Alliance ...... 21 Risks Related to Reliance on Key Agreements and Relationships ...... 21 Risks Related to Delays in the Development and Launch of the OptiSAR Constellation or UrtheDaily Constellation ...... 22 Risks Related to a Sale or Licensing Arrangement in Respect of the ISS Cameras ...... 23 Risks Related to Negative Cash Flows ...... 24 Risks Related to Obtaining Funding in case of Loss of or Damage to a Satellite ...... 24 Risks Related to Limited Insurance Coverage and Availability of Adequate Insurance ...... 24 Risks Related to Failure to Obtain, or Loss of, Regulatory Approvals ...... 25 Risks Related to Government Funding ...... 25 Risks Related to Provision of Services by Elecnor Following the Acquisition Closing ...... 26 Risks Related to the Loan and Indebtedness Generally ...... 26 Risks Related to Security Measures ...... 27 Risks Related to Intellectual Property ...... 27 Risks Related to Infrastructure ...... 29 Risks Related to Failure to Protect EO Data ...... 29 Risks Related to Failure to Gain Market Acceptance ...... 30 Risks Related to Changes in Technology ...... 30 Risks Related to Competition and Loss of Market Share ...... 30 Risks Related to Lack of Revenue and Additional Funds ...... 31 Risks Related to Dependence on Foreign Data Distributors ...... 31 Risks Related to Changes in Laws and Regulations and Political Developments ...... 32 Risks Related to Operating in Foreign Jurisdictions and Political Developments and Uncertainty in the Russian Federation ...... 32

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Risks Related to Global Economic Conditions ...... 33 Risks Related to the Prior Business of Longford ...... 33 Risks Related to Third Party Credit Risk ...... 33 Risks Related to Currency Exchange Rate Risk ...... 33 Risks Related to Liquidity of Common Shares ...... 33 Risks Related to Market Price Volatility of Common Shares ...... 34 Risks Related to Potential Dilution of Common Shares ...... 34 Risks Related to Dividends ...... 34 Risks Related to Privacy and Consumer Protection Laws ...... 34 Risks Related to UrtheCast's Directors, Officers and Employees ...... 34 DIVIDENDS ...... 35 DESCRIPTION OF CAPITAL STRUCTURE ...... 35 Common Shares ...... 35 Warrants ...... 35 Options ...... 35 Share Units ...... 36 MARKET FOR SECURITIES ...... 36 Trading Price and Volume ...... 36 Prior Sales ...... 36 Common Shares ...... 36 Options ...... 37 Restricted Share Units ...... 37 Warrants ...... 37 ESCROWED SECURITIES AND SECURITIES SUBJECT TO CONTRACTUAL RESTRICTION ON TRANSFER ...... 38 DIRECTORS AND OFFICERS ...... 38 Corporate Cease Trade Orders or Bankruptcies ...... 41 Penalties or Sanctions ...... 42 Personal Bankruptcies ...... 42 Conflicts of Interest ...... 42 Promoters ...... 42 LEGAL PROCEEDINGS AND REGULATORY ACTIONS ...... 42 INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS ...... 43 TRANSFER AGENT AND REGISTRAR ...... 43 MATERIAL CONTRACTS ...... 43 INTERESTS OF EXPERTS ...... 43 ADDITIONAL INFORMATION ...... 43 AUDIT COMMITTEE ...... 44 Composition of the Audit Committee ...... 44 Relevant Education and Experience ...... 44 The Audit Committee's Charter ...... 45 Audit Committee Oversight ...... 45 Pre-Approval Policies and Procedures ...... 45 External Auditor Service Fees by Category ...... 45 APPENDIX "A" – AUDIT COMMITTEE CHARTER

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GENERAL MATTERS AND FORWARD-LOOKING STATEMENTS

Unless otherwise indicated, information contained in this Annual Information Form ("AIF") is provided as at December 31, 2016. Unless the context otherwise requires, all references in this AIF to "UrtheCast" and the "Company" refer to EVC (as defined below under the heading "Corporate Structure") prior to the completion of the Formation Transaction (as defined below under the heading "Corporate Structure") and UrtheCast Corp. and its operating subsidiaries, unless the context otherwise requires, after the completion of the Formation Transaction. In this AIF, references to "$", "Cdn$", "dollars" or "Canadian dollars" are to Canadian dollars and references to "US$" are to United States dollars.

This AIF is prepared as of March 27, 2017. You should read this AIF in conjunction with the Company's audited annual financial statements and accompanying notes for the year ended December 31, 2016 (the "Annual Financial Statements"), and the related management's discussion and analysis ("Annual MD&A") thereon, which are available under the Company's issuer profile on SEDAR at www.sedar.com. The Company presents its financial statements and management's discussion and analysis in Canadian dollars and in accordance with International Financial Reporting Standards ("IFRS").

Forward-Looking Statements

This AIF contains forward-looking statements that relate to the Company's current expectations and views of future events.

In some cases, these forward-looking statements can be identified by words or phrases such as "may", "will", "expect", "anticipate", "estimate", "intend", "plan", "seek", "believe", "potential", "continue", "is/are likely to", "could", "would", "should" or the negative of these terms, or other similar expressions intended to identify forward- looking statements. The Company has based these forward-looking statements on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy and financial needs. In this AIF, these forward-looking statements include, among other things, statements relating to:

• the Company's expectations with respect to the performance of, value of, and ability of the Company to sell or license its interest in the high-resolution video camera ("HRC") and medium resolution camera ("MRC" and together with the HRC, the "ISS Cameras") aboard the International Space Station ("ISS") and the Deimos-1 and Deimos-2 satellites; • the Company's expectations regarding its revenue, expenses and operations; • the Company's plans for, timing of, and expansion of its products and value-added services, including geo-information and geoanalytics products; • the Company's expectations regarding its relationship with members of the PanGeo Alliance (as defined below under the heading "General Development of the Business") and revenues derived therefrom; • the Company's anticipated cash needs and its needs for additional financing; • the Company's ability to protect, maintain and enforce its intellectual property rights; • the Company's ability to defend itself against third-party claims of infringement or violation of, or other conflicts with, intellectual property rights by the Company; • the Company's future growth plans, including in respect of the development, launch, commissioning and operation of the OptiSARTM satellite constellation (the "OptiSAR Constellation") and UrtheDailyTM satellite constellation (the "UrtheDaily Constellation") and value-added products and services, including those made available via UrtheCast’s web platform;

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• the Company’s ability to continue a cooperative relationship with S.P. Korolev Rocket and Space Public Corporation Energia ("Energia") and successfully reach an alternative licensing arrangement for, or sale of, the ISS Cameras; • expectations regarding the successful conversion of the Company’s remaining memoranda of understanding ("MOUs") and other customer discussions in respect of the OptiSAR Constellation into binding, definitive agreements for the purchase of satellites within the OptiSAR Constellation, and the Company’s ability to finance the development, build, launch and commissioning of the OptiSAR Constellation in general; • expectations regarding the data-buy contracts entered into with prospective customers of the UrtheDaily Constellation, including but not limited to Land O' Lakes, Inc. and the Company's ability to finance the development, build, launch and commissioning of the UrtheDaily Constellation in general; • expectations regarding the Company’s ability to secure a build contract with Surrey Satellite Technology Ltd. ("SSTL") or another satellite subcontractor and a satellite launch contract with a launch services provider in respect of the OptiSAR Constellation and the UrtheDaily Constellation; • the acceptance by the Company's customers and the marketplace of new satellite imaging content, technologies and solutions; • the Company's ability to attract new customers; • the Company's ability to attract and retain personnel; • the Company's competitive position and its expectations regarding competition; • regulatory developments and the regulatory environments in which the Company operates; • the Company's ability to comply with its debt service obligations and related covenants; • anticipated trends and challenges in the Company's business and the markets in which it operates; and • the expectations of the Company and third-party industry research organizations regarding the future growth of the geo-information and geoanalytics industries. Such statements reflect the Company's current views with respect to future events and are subject to risks and uncertainties and are necessarily based upon a number of estimates and assumptions that, while considered reasonable by UrtheCast, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause the Company's actual results, performance or achievements to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements, including, among others:

• risks relating to the Company not generating annual profit from its operating activities; • risks relating to the loss of, reduction in scope of, or inability to satisfy the financing and other conditions set out in, the Company's binding agreement with a confidential government customer for the sale and shared operation of the first two satellites in the Company's planned OptiSAR Constellation for a purchase price of approximately US$180 million; • risks relating to any delays or failures in the financing, design, development, construction, launch and operational commissioning of the proposed UrtheDaily Constellation or the OptiSAR Constellation, including but not limited to the Company being unable to adequately finance the development, building, launch and commissioning of the UrtheDaily Constellation or the OptiSAR Constellation, or to convert the remaining MOUs and other customer discussions in respect of the OptiSAR Constellation into binding, definitive agreements for the purchase of satellites or services within the OptiSAR Constellation; • risks relating to the loss, reduction in scope, or decline of the Company's agreements or relationships with Energia, NZ OMZ and Roscosmos State Corporation, SSTL, Land O’ Lakes, Inc. and other key agreements;

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• risks related to the Company's ability to continue a cooperative relationship with Energia or to secure an alternative licensing arrangement or sale of the ISS Cameras; • failures of the ISS or the ISS Cameras which could affect the Company's efforts to monetize or sell these assets; • risks related to the expected revenues derived through the PanGeo Alliance; • risks relating to the loss or reduction in scope of the Company's contract dated November 24, 2014, as amended, with a confidential customer for US$65 million to provide engineering services over a five- year period; • risks relating to the loss or reduction in scope of any of the Company's reseller, distributor or data purchase agreements; • failure of the Deimos-1 or Deimos-2 satellites and risks related to damage which may occur during operation of the satellites; • risks related to the Government funding received by UrtheCast and risks arising from breach or default of obligations under the related agreements with the Governments of Canada and Spain; • failure to obtain, or loss of, regulatory approvals; • breaches of the Company's system security measures that could result in interruption, delays or suspension of its ability to provide its products and services; • interruptions to or failures of the Company's infrastructure; • risks relating to the Company's ability to protect and maintain its Earth Observation ("EO") imagery and data; • market acceptance of UrtheCast's products and services, including various geoanalytics products and services, and the current and proposed products and services offered through the UrthePlatform and Application Programming Interfaces ("APIs"); • uncertainties and assumptions in the Company's revenue forecasts, including the extent to which any MOU is converted into a binding agreement; • risks relating to the Company's ability to make new UrthePlatform features publicly available or to successfully generate revenue from the Company's UrthePlatform; • changes in technology and evolving standards of the EO and geoanalytics industries; • defects or disruptions in UrtheCast's proposed products and services; • risks related to the operations of Longford Energy Inc. prior to the completion of the Formation Transaction (as defined below under the heading "Corporate Structure"); • legal and regulatory changes in Canada, the Russian Federation, the United States, Spain, Malta and other foreign jurisdictions in which the Company expects to conduct operations; • risks relating to operating in foreign jurisdictions and political developments and uncertainties in the Russian Federation; • risks that the Company may be unable to raise additional financing should its expected revenues not materialize; • risks related to loss or infringement of UrtheCast's intellectual property or UrtheCast's infringement of intellectual property belonging to third parties; • the Company's dependence on key personnel and the risk of conflicts of interest; • the Company's success in expanding sales into new international markets; • competition in the Company's industry;

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• market price volatility of the common shares of the Company ("Common Shares"); • global economic, political and financial market conditions; • failure to manage the Company's growth successfully; • the Company's ability to pay dividends; • third party credit risks; • currency exchange rate fluctuations; • risks relating to the Loan (as defined below under the heading "General Development of the Business – Three Year History – Financings"), and the failure of the Company or its subsidiaries to comply with the covenants and obligations with respect thereto; • risks related to future dilution and liquidity of the Common Shares; • risks related to forward-looking information; and • negative cash flows from the Company's operations. By their very nature, forward-looking statements or information involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, events or developments, or industry results, to be materially different from any future results, events or developments expressed or implied by such forward-looking statements or information. In evaluating these statements, prospective purchasers should specifically consider various factors, including the risks outlined herein and in documents incorporated by reference herein under the heading "Risk Factors". Should one or more of these risks or uncertainties or a risk that is not currently known to the Company materialize, or should assumptions underlying those forward-looking statements prove incorrect, actual results may vary materially from those described herein. These forward-looking statements are made as of the date of this AIF or, in the case of documents incorporated by reference in this AIF, as of the date of such documents, and UrtheCast does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by law. Investors are cautioned that forward-looking statements are not guarantees of future performance and accordingly investors are cautioned not to put undue reliance on forward-looking statements due to their inherent uncertainty. Additional information about UrtheCast, including copies of its continuous disclosure materials such as its MD&A, is available on UrtheCast's website at www.urthecast.com and through the System for Electronic Document Analysis and Retrieval website maintained by the Canadian Securities Administrators ("SEDAR") at www.sedar.com.

CORPORATE STRUCTURE

Name, Address and Incorporation

UrtheCast was formed as a result of a plan of arrangement under the Business Corporations Act (Ontario) between Earth Video Camera Inc. ("EVC") and Longford Energy Inc. ("Longford"), pursuant to which EVC completed a reverse takeover of Longford and renamed the company "UrtheCast Corp." (the "Formation Transaction"). On June 21, 2013, the Formation Transaction was completed by EVC and Longford, following which UrtheCast was formed.

Longford did not have any significant operations at the time of the Formation Transaction. Immediately following the closing of the Formation Transaction, the Company changed its name to "UrtheCast Corp." and reconstituted its board of directors (the "Board of Directors" or the "Board") and its senior management team. Subsequently, UrtheCast and EVC completed an amalgamation pursuant to the Business Corporations Act (Ontario) and continued using the name "UrtheCast Corp.".

The principal business office and registered office of the Company is located at Unit 33–1055 Canada Place, Vancouver, British Columbia, Canada, V6C 0C3. The Company's website is www.urthecast.com. The information on the Company's website is not incorporated by reference into this AIF. The Common Shares are listed on the Toronto Stock Exchange ("TSX") under the symbol "UR".

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Intercorporate Relationships

UrtheCast has three wholly-owned operating subsidiaries, UrtheCast USA, Inc., a company incorporated under the laws of Delaware on July 13, 2012, Space Video Company LLC, a company incorporated under the laws of the Russian Federation on November 13, 2013, and UrtheCast International Corp., a company incorporated under the laws of Canada on May 19, 2015. The Company's corporate structure is set out below.

UrtheCast Corp. (Ontario)

100% 100% 100%

Space Video Company UrtheCast International UrtheCast USA, Inc. LLC Corp. (Delaware) (Russian Federation) (Canada)

100% 100%

UrtheCast Holdings UrtheCast Imaging, S.L.U. (Malta) Limited (Spain) (Malta)

100% 100% 100%

UrtheCast Investments DOT Imaging S.L.U. Deimos Imaging S.L.U. (Malta) Limited (Spain) (Spain) (Malta)

UrtheCast has two additional wholly-owned subsidiaries, Holland Operating Corp. (Alabama) and UrtheCast (Barbados) Holding Inc. (Barbados), which are currently dormant.

GENERAL DEVELOPMENT OF THE BUSINESS

UrtheCast (then EVC) was initially formed in December 2010 to build, launch and operate cameras to provide the world's first commercially available high-definition video of planet Earth, streamed from space. UrtheCast is now at an advanced stage of implementing its evolved business plan to serve the rapidly evolving geospatial and geoanalytics markets with a wide range of information-rich products and services. The Company currently operates EO sensors in space, including two satellites, Deimos-1 and Deimos-2. Imagery data from these sensors is continuously downlinked to ground stations around the world and distributed directly to partners and customers or displayed on UrtheCast’s proprietary web-based platform, known as the “UrthePlatform”. UrtheCast also processes and distributes imagery data and value-added products on behalf of the PanGeo Alliance, a network of eight EO satellite operators with a combined 15 medium- and high-resolution EO sensors, formed and led by Deimos Imaging, S.L.U. a wholly-owned subsidiary of UrtheCast (see “Description of the Business – Products and Services – Earth Observation” below).

UrtheCast is also developing and pursuing its plans to build, launch and operate two satellite constellations, known as UrtheDaily™ and OptiSAR™, respectively. In June 2015, UrtheCast first announced its plans to build, launch and operate the OptiSAR Constellation, which is expected to be comprised of 16 satellites in total (eight optical and eight Synthetic Aperture Radar ("SAR") satellites) flying in two orbital planes, with each plane consisting of four satellite pairs. Each pair is being designed to fly in tandem and consists of a high-resolution optical satellite offering video and pushbroom imaging and a dual-band, high-resolution SAR satellite comprised of X and L radar bands. By employing two orbital planes, the OptiSAR Constellation is expected to provide for high revisit rates in the mid- latitudes, while providing global coverage extending to the poles. Subject to UrtheCast financing the build and launch of the satellites in the first orbital plane, the first eight satellites of the OptiSAR Constellation are scheduled to begin operations in 2022. In March 2016, UrtheCast announced its plans for the UrtheDaily Constellation, which is expected to be comprised of eight EO satellites and is designed to capture medium-resolution imagery of the Earth’s entire

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landmass (excluding Antarctica) every day, producing machine learning-ready, scientific-grade data to help geoanalytics companies measure and monitor change on our planet. Subject to UrtheCast financing the build and launch of the first four UrtheDaily satellites, the UrtheDaily Constellation is scheduled to begin operations in 2020. See "Risk Factors - Risks Related to Delays Development and Launch of the OptiSAR Constellation or UrtheDaily Constellation".

Revenues are currently generated (i) by direct data sales to institutional users (both commercial and government), (ii) through the provision of engineering services, which includes niche areas of EO technology development, including technology licensing, training, paid research and development, and creation of technology solutions for customers with specific requirements, and (iii) through other value-added services and imagery-related products, including through the UrthePlatform.

Three Year History

ISS Cameras

In 2012, UrtheCast entered into a partnership agreement with Energia, Russia’s prime contractor for the ISS, to conduct a joint project to install and operate the ISS Cameras aboard the Russian segment of the ISS. The agreement was crafted to last for the life of the ISS, which is currently funded until 2024. Under the terms of the agreement, Energia provided UrtheCast with, among other things, the launch and installation of the HRC and MRC aboard the ISS, a bi-axial pointing platform for the HRC, and ongoing maintenance and operations of the cameras for the life of the agreement at no cash cost to UrtheCast, in return for certain rights to the data produced by the ISS Cameras.

On January 27, 2014, Russian cosmonauts installed the ISS Cameras onto the exterior of the ISS. On July 16, 2014, UrtheCast announced that the MRC had achieved initial operational capability. This means that the camera system is capable of large capacity data collections, the data is meeting all specifications, and UrtheCast's cloud-based processing system is capable of generating imagery products autonomously (see below under the heading "General Development of the Business – Three Year History – UrthePlatform Development").

On July 16, 2014, UrtheCast also announced that the commissioning of the HRC would be delayed by several months due to technical issues with the bi-axial pointing platform (the "BPP"). The BPP, which was provided by Energia as part of the infrastructure of the ISS, allows the HRC to be pointed at and to track targets during video take, while the ISS moves at 25,000 kilometres per hour. During on-orbit testing of the HRC and the BPP it was discovered that the BPP was experiencing difficulties achieving the pointing control precision needed for the HRC to meet image quality specifications. UrtheCast's engineering team developed a solution involving software updates and the installation of additional cabling inside the Zvezda module of the ISS. As the cables needed to be manufactured and tested prior to certification for delivery, and subsequently installed, this caused a delay of several months in commissioning the HRC. In 2014, the Company filed a Proof of Loss claim with its insurers under its insurance policy for revenue interruption due to the delay in commissioning of the HRC. UrtheCast filed an initial claim of $7.75 million under the policy in the fourth quarter of 2014 and a final claim of $3.75 million in May 2015, upon reaching the maximum amount under the policy. All amounts under the business interruption coverage have been received from the insurers. In addition, in December 2015 UrtheCast filed a partial loss claim of $5.2 million on its in-orbit asset coverage and a claim of $2.1 million for recovery of costs related to corrective actions by the Company to resolve the technical issues. These amounts were received from the insurers in the first quarter of 2016. The commissioning work on the HRC and BPP was completed and the HRC commenced initial operations during the third quarter of 2015, with continually improving data capacity and processing capability, which allowed the Company to begin delivering commercial quality imagery to a select group of customers. By Q1 2016, both HRC and MRC achieved Full Operational Capability ("FOC").

On November 10, 2016, the Company announced that Energia had advised UrtheCast it would be terminating the existing agreement, referred to above, effective December 31, 2016 and that a new arrangement would need to be negotiated for the program’s continuation, including permitting UrtheCast to task the ISS Cameras. The Company does not expect that a new commercial arrangement can be reached with Energia and as a result, the Company is seeking to monetize these assets through alternative means, including licensing arrangements or an asset sale (See "Risk Factors – Risks Related to a Sale or Licensing Arrangement in Respect of the ISS Cameras")

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OptiSAR Constellation

On July 16, 2014, UrtheCast announced plans to develop its next-generation, state of the art EO sensors, which were initially intended to be deployed on the American segment of the ISS (referred to as "Gen-2" sensors). The two proposed Gen-2 sensors, a high-resolution dual-mode optical/video camera and a high-resolution dual-band Synthetic Aperture Radar ("SAR"), were expected to complement UrtheCast's MRC and HRC sensors.

On June 19, 2015, UrtheCast announced plans to build, launch and operate the OptiSAR Constellation, to be deployed over multiple launches, with operations now expected to begin in 2022. The Constellation is expected to comprise 16 satellites (8 optical and 8 SAR), flying in two orbital planes, with each plane consisting of four satellite pairs, equally-spaced around the orbital plane. Each pair of satellites is expected to consist of a dual-mode, high- resolution optical satellite (video and pushbroom) and a dual-band high-resolution SAR satellite (X-band and L-band) flying in tandem. The OptiSAR Constellation will provide what the Company anticipates to be unique space-imaging capabilities, including high collection capacity, optical and SAR data fusion, weather-independent high-resolution imaging using the SAR, target revisit, and imaging latency. By flying the satellites in tightly-paired SAR and optical tandem formations, the OptiSAR Constellation is expected to offer a number of innovative capabilities, including onboard real-time processing, cross-cueing between the satellites, and real-time cloud imaging on the leading SAR satellites to enable cloud-cover avoidance in the trailing optical satellites. By employing two orbital planes, the OptiSAR Constellation is expected to provide maximum revisit rates in the mid-latitudes, while providing the Company with global coverage extending to the poles.

On November 10, 2015, UrtheCast announced that due to the strong market interest in the OptiSAR Constellation, UrtheCast's progress in refining the satellites' designs, and its increasing confidence in the market potential of this first-of-its-kind constellation, UrtheCast accelerated the OptiSAR Constellation development timeline by prioritizing the OptiSAR Constellation program over the Gen-2 sensors that were to be placed on the ISS. The Company believes that the decision not to proceed with Gen-2 and jump directly into the OptiSAR Constellation will result in a faster, lower-cost path to becoming a diversified EO company with a world-class imaging platform capable of servicing the entire spectrum of the EO industry.

On March 30, 2016, UrtheCast provided investors with an overview of the OptiSAR Constellation program at its first Capital Markets Day held in Toronto, Ontario and announced it had entered into multiple Memoranda of Understanding ("MOUs") with several prospective customers for the purchase and shared operation of some satellites expected to comprise the OptiSAR Constellation.

On May 2, 2016, UrtheCast announced that it had successfully completed prototype hardware testing of the principal core enabling elements of the SAR technology. In February 2016, UrtheCast completed successful verification of SAR's co-located dual frequency phased array antenna, a key component of the SAR sensor of the OptiSAR satellites, at the Centre for Intelligent Antenna and Radio Systems at the University of Waterloo in Ontario, Canada. There, the SAR antenna was shown to meet all the requirements of OptiSAR mission, and paved the way for the development of the Engineering Model, the final engineering step on the path to building the flight model.

On January 17, 2017, UrtheCast announced that it had entered into a binding agreement with a confidential government customer for the sale and shared operation of the first two satellites in the Company's planned OptiSAR Constellation for a purchase price of approximately US$180 million. The agreement represents UrtheCast's first successful conversion of the three previously announced MOUs for the purchase of the OptiSAR Constellation satellites into binding contracts. The agreement is subject to a number of closing conditions, including UrtheCast obtaining the necessary customer commitments to allow for the build, launch and financing of the first eight satellites in the OptiSAR Constellation, the customer obtaining funding on or before January 17, 2018, the parties reaching mutual agreement on the detailed procedures for the shared operation and tasking of the two satellites, and other customary covenants and regulatory approvals for agreements of this nature. Provided these closing conditions are satisfied or waived, the purchase price is expected to be paid upon achievement of certain build-phase milestones, starting when UrtheCast begins building the first eight satellites. UrtheCast has also entered into non-binding MOUs with other potential customers for satellites in the OptiSAR Constellation and is continuing negotiations to convert these MOUs into binding, definitive agreements. UrtheCast expects that each agreement, if realized, will have unique pricing depending on the imaging and commercial rights, ground segment features, and the operating, maintenance

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and training services to be provided to each customer. See "Risk Factors – Risks Related to Delays in the Development and Launch of the OptiSAR Constellation or UrtheDaily Constellation" below.

UrtheDaily Constellation

On March 30, 2016, at UrtheCast’s Capital Markets Day held in Toronto, Ontario, UrtheCast announced its plans for a constellation of eight EO satellites, a global coverage constellation designed to acquire high-quality, multispectral imagery, at 5-m ground sample distance, taken at the same time, from the same altitude, every day. Together, the satellites in this constellation could deliver daily, medium-resolution imagery of the entire planet's landmass (excluding Antarctica).

Throughout 2016, UrtheCast continued to develop its plans for this constellation, now known as the UrtheDaily Constellation, and engaged in discussions with various customers for advance commitments to purchase imagery data generated by the UrtheDaily Constellation, if realized (see "Description of the Business – General – Competitive Conditions")

On February 7, 2017, UrtheCast announced it had entered into its first significant, long-term advance purchase commitment to deliver geospatial data from the UrtheDaily Constellation to GEOSYS, a subsidiary of Land O' Lakes, Inc. This agreement was the culmination of a lengthy public Request for Proposal process undertaken by Land O'Lakes, Inc. to secure a source of high-quality and high-revisit EO imagery to support its agriculture-focused products. Pursuant to the terms of the agreement, GEOSYS will become an anchor customer for the UrtheDaily Constellation. The agreement, for an undisclosed purchase price and term, represents UrtheCast’s largest data buy contract to date. The Company expects that the agreement will provide GEOSYS with sufficient capacity to receive imagery of the Earth’s entire landmass (excluding Antarctica) throughout the contract term. Payments will begin as soon as UrtheCast begins delivering UrtheDaily Constellation data to GEOSYS, subject to UrtheCast arranging its financing for the build and launch of the first four satellites of the UrtheDaily Constellation and other customary covenants for agreements of this nature (see "Risk Factors – Reliance on Key Agreements and Relationships" and "Risk Factors – Risks Related to Delays in the Development and Launch of the OptiSAR Constellation or UrtheDaily Constellation").

Government Funding

On April 13, 2016, UrtheCast announced that it was awarded a technological contribution agreement in the amount of CAD $2 million as part of the Space Technologies Development Program implemented by the Canadian Space Agency. The Contribution Agreement will support the continued development of the OptiSAR Constellation, currently slated for deployment in 2020-2021. On May 26, 2016, UrtheCast announced that it would receive CAD $5 million in Government of Canada Technology Development Program funding, as part of a $54 million contribution program for the development of new satellite technologies, as administered by the Government of Canada. UrtheCast's amount is scheduled to be paid out evenly over five years and is intended to aid UrtheCast in the development of the technologies for its planned OptiSAR Constellation.

On February 9, 2017, UrtheCast entered into a Contribution Agreement with the Ministry of Innovation, Science and Economic Development to receive approximately $17.6 million in funding from Innovation, Science and Economic Development Canada's Industrial Technologies Office as part of its Strategic Aerospace & Defence Initiative (SADI) program. This funding is expected to provide financial support for the ongoing development of the OptiSAR Constellation. Under the terms of the agreement, the Company receives a low-interest, long term loan on an expense reimbursement basis totaling approximately $17.6 million. The agreement is structured as a repayable contribution that management anticipates will be disbursed in quarterly installments over the next four years and repaid by UrtheCast in annual installments over 15 years, beginning in 2023. Disbursement of funds is subject to customary conditions in agreements of this nature, including covenants to perform certain work and maintain ownership of intellectual property in Canada during the term of the agreement, which expires in 2037. The total amount to be repaid, including interest, is approximately $29 million. See "Risk Factors – Risks Related to Government Funding".

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Deimos Imaging Acquisition

On June 22, 2015, UrtheCast announced that it entered into a definitive agreement (the "Deimos Acquisition") with Elecnor, S.A. ("Elecnor") and Elecnor Deimos Space to acquire Elecnor's EO businesses, Deimos Imaging, S.L.U. and DOT Imaging, S.L.U. (collectively referred to as "Deimos Imaging") for an aggregate purchase price of €74.2 million, subject to customary working capital adjustments. The Deimos Acquisition closed on July 15, 2015.

The Deimos-1 satellite was launched in 2009 with an expected lifetime of 10 years and is owned, together with certain related infrastructure, by Deimos Imaging. Deimos-1 provides 22 metre resolution images at 10 bits with a swath width of 650 kilometres. The Deimos-1 camera has three spectral bands (R, G and NIR), while a synthetic blue band can also be generated to produce natural-colour imagery. Deimos-1 has a collection capacity of more than 5,000,000 square-kilometres per day, with a three-day average revisit time worldwide.

The Deimos-2 satellite was launched in 2014 with an expected lifetime of more than seven years and is owned, together with certain ground segment assets and software, by DOT Imaging, S.L.U. ("DOT Imaging"). Deimos-2 provides 75 centimetre pan-sharpened images at 10 bits with a swath width of 12 kilometres. Deimos-2 also has stereo-pair capability and ±45º off-nadir tilting capacity. The camera on the Deimos-2 satellite has a panchromatic band and four spectral bands (R, G, B, NIR). Deimos-2 has a collection capacity of more than 150,000 square- kilometres per day, with a two-day average revisit time worldwide. There is an antenna in Puertollano, Spain (owned by Deimos Castilla La Mancha, S.L.U.), and Deimos Imaging has entered into agreements to obtain access to third party ground stations around the world.

Deimos Imaging operates at premises located in Boecillo, Madrid and Puertollano in Spain, some of which are owned, directly or indirectly, by Elecnor. Deimos Imaging is a member of the PanGeo Alliance, which represents a cooperative effort amongst four EO satellite operators and coordinates access by customers to each member's imagery archive, as well as certain related services.

Engineering Services

On November 24, 2014, UrtheCast announced that it had signed a five-year contract with a confidential customer for the provision of engineering and value-added services and earth imagery data valued at US $65 million. A significant portion of the contract is allocated for non-data related engineering and value-added services to be provided by UrtheCast over the first three years of the contract. The terms of the contract provide for the payment of a cash advance in the amount of 20% of the total contract value and a letter of credit for the balance of payments, with payments to be received from the customer based on the achievement of predetermined payment milestones. Prior to obtaining the final signature on the contract, the customer provided the Company with an Authorization to Proceed and an advance payment of US $3 million, which allowed the Company to begin preliminary work on the program. In December 2015, this contract was amended to incorporate work being performed in connection with the OptiSAR Constellation in lieu of the Gen-2 program. On April 28, 2016, the Company announced that it had reached an agreement with this customer to re-allocate all of the funds payable under the contract to engineering services. With this amendment to the original contract, the entire US $65 million contract is now for the provision of engineering services. As of December 31, 2016, the Company has received US$ 29.2 million from this contract, including the 20% cash advance.

In February 2015, UrtheCast entered into a contract with an international customer valued at US $9 million to provide space hardware and engineering services. Under the terms of the contract, hardware will be delivered to the customer in 2017. UrtheCast received an advance payment of US $6.3 million from the customer during the first quarter of 2015 and the remainder of the contract value is receivable upon delivery of the equipment.

In January 2017, UrtheCast entered into a second contract with this international customer valued at US $3.9 million to provide engineering services and space hardware. Under the terms of the contract, hardware is expected to be delivered in the fourth quarter of 2017. UrtheCast received 70% of the contract price in the first quarter of 2017 and the remainder of the contract value is receivable upon delivery of the equipment.

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UrthePlatform Development

The UrthePlatform was opened in mid-September 2014 to a select set of application developers who had requested early access. Additional features of the UrthePlatform and application programming interface ("API") were released to the developer community in January 2015. APIs, or "machine readable" interfaces that give users access to another service's data and products, enable two pieces of software to work together and are essential for making use of the imagery data available on the UrthePlatform. In December 2015, the UrthePlatform entered a beta phase which made access to the UrthePlatform available to users and developers. In January 2016, UrtheCast announced the launch of Ordering APIs on the UrthePlatform, which are designed to address the data-centric and analysis-driven demands of EO customers by making it easy to extract data from UrtheCast's archive, on-demand, from within existing software systems. Using Ordering APIs, customers are able to purchase and download imagery in a GeoTIFF format from the UrthePlatform. As of the date of this AIF, certain imagery from UrtheCast's MRC camera, the Deimos-1 and Deimos- 2, the Sentinel-1 satellite and the United States Geological Survey's (USGS) Landsat-8 satellite are available. The UrthePlatform is expected to be an integrated component of UrtheCast's distribution of EO data and value-added products, including expected products to be derived from the OptiSAR Constellation and UrtheDaily Constellation, and key to UrtheCast's core goal of democratizing EO data, enabling a broader understanding of how the world changes and facilitating big-data geoanalytics on EO datasets. See "Risk Factors – Risks Related to Failure to Gain Market Acceptance".

Financings

On December 13, 2013, UrtheCast filed (and received a receipt for) a final short form prospectus with the securities regulators in Alberta, British Columbia and Ontario (the "2013 Prospectus"). The 2013 Prospectus qualified the distribution of 4,545,500 Common Shares at a price of $2.20 through a syndicate of underwriters for aggregate gross proceeds of $10,000,100, as well as the grant of an over-allotment option to the underwriters to purchase up to an additional 681,825 Common Shares at the same offering price (the "Over-Allotment Option"). On January 16, 2014, the underwriters exercised the entire Over-Allotment Option and, as a result, the Company issued an additional 681,825 Common Shares for aggregate gross proceeds of $1,500,015.

On April 7, 2014, UrtheCast filed a Short Form Base Shelf Prospectus (the "Shelf Prospectus") with Canadian securities regulators. The Shelf Prospectus is effective for a 25-month period and initially allowed for the issuance of up to $75,000,000 of debt or equity securities, which was later increased to $200,000,000 after subsequent financings.

On April 16, 2015, UrtheCast announced that it closed a public offering pursuant to the Shelf Prospectus of 8,625,000 Common Shares at a price of $2.00 per Common Share, for aggregate gross proceeds of $17,250,000. Part of the funds were added to working capital and put towards the commissioning and commercialization of the MRC and HRC and for general corporate purposes, including funding the Company's growth strategy. Part of the proceeds were also used to fund the Deimos Acquisition. On July 7, 2015, UrtheCast also closed a public offering pursuant to the Shelf Prospectus of 21,625,000 subscription receipts for gross proceeds of $99,475,000, in connection with the Deimos Acquisition. In addition, the underwriters were granted an option to purchase up to an additional 3,243,750 subscription receipts at the Offering Price, which was fully exercised. Each subscription receipt entitled the holder thereof to receive, without payment of additional consideration or further action, one Common Share in exchange for each subscription receipt. All subscription receipts were subsequently exchanged for Common Shares.

On December 11, 2015, the Company announced that its wholly-owned Spanish subsidiary, UrtheCast Imaging, S.L.U. ("UrtheCast Spain") obtained a senior secured term loan of €25 million (the "Loan") from Banco de Sabadell, S.A. ("Sabadell"). The Loan has a five-year term and accrues interest at the 6-month Euro Interbank Offered Rate (EURIBOR), which shall be deemed to be no less than 0%, plus 2.6% per annum. €20 million of the Loan proceeds were used to reduce an inter-company loan made by UrtheCast to UrtheCast Spain in connection with the Deimos Acquisition. The remaining proceeds of €5 million are being held on deposit with Sabadell as a new bank guarantee (the "New Bank Guarantee") to replace an existing bank guarantee to Elecnor provided in connection with the Deimos Acquisition. By replacing the prior guarantee, €5 million of restricted cash was released, returning these funds to the Company for general working capital purposes.

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The Loan is secured by certain assets of UrtheCast's wholly-owned non-Canadian subsidiaries and the outstanding shares thereof. Repayment of €20 million of the Loan is being made in five equal payments on each annual anniversary of the closing date of the Loan, the first of which occurred on December 11, 2016. The remaining €5 million will be payable at the end of the term using the funds held for the issuance of the New Bank Guarantee, which will expire prior to the maturity of the Loan. Pre-payments will be permitted at UrtheCast Spain's option, subject to a 1% pre-payment fee under certain circumstances. A copy of the Loan agreement is filed under the Company's issuer profile on SEDAR at www.sedar.com.

On March 22, 2017, UrtheCast completed an underwritten public offering of 13,033,341common shares at an offering price of $1.50 per share for aggregate gross proceeds of $19,550,011 pursuant to a final short form prospectus filed with securities regulators in each of the Provinces of Canada other than Québec and applicable registration exemptions in the United States.

Corporate Developments

On December 9, 2015, the Company's Chief Executive Officer, Scott Larson, resigned as a director and officer of the Company. On the same day, the Board appointed Mr. Wade Larson, President, Chief Operating Officer and a Director of the Company, to the role of Chief Executive Officer.

On April 6, 2016, UrtheCast announced that the Board approved the adoption of a shareholder rights plan (the "Rights Plan") effective April 5, 2016. The Rights Plan is designed to ensure that, in the context of a bid for control of the Company through an acquisition of Common Shares, all shareholders have an equal opportunity to participate in, and adequate time to assess, the bid. The Rights Plan is not intended to prevent take-over bids that treat shareholders equally and offer fair value. The Rights Plan expressly permits certain take-over bids, referred to as "permitted bids", that meet basic requirements intended to protect the interests of shareholders. Under the terms of the Rights Plan, one right (a "Right") will be issued by the Company for each outstanding Common Share. The Rights become exercisable only if a person acquires 20% or more of the Common Shares of the Company without complying with the "permitted bid" provisions of the Rights Plan or without the approval of the Board. Once exercisable, the Rights entitle holders (other than such acquiring person, its affiliates, associates and joint actors) to purchase Common Shares of the Company at a substantial discount to the prevailing market price at the time that the Rights become exercisable. The Rights Plan was approved at the Company's Annual General and Special Meeting of Shareholders on May 10, 2016.

On November 16, 2016, UrtheCast announced that it had been awarded the #1 spot on Deloitte's 19th annual Technology Fast 50 program. This designation has been awarded to UrtheCast for being the fastest growing technology company in Canada in terms of revenue growth over the period 2012 to 2015.

On February 21, 2017, UrtheCast announced that Sai W. Chu would be appointed Chief Financial Officer of the Company in late March 2017, following the resignation of Mr. Issa Nakhleh. Mr. Chu brings extensive experience in financial management, business development and capital markets to UrtheCast.

DESCRIPTION OF THE BUSINESS

General

The Company currently operates EO sensors in space, including two satellites, Deimos-1 and Deimos-2. Imagery data from these sensors is continuously downlinked to ground stations around the world and distributed to customers. UrtheCast also processes and distributes imagery data and value-added products on behalf of the PanGeo Alliance, a network of eight EO satellite operators with a combined 15 medium- and high-resolution EO sensors, formed and led by Deimos Imaging, a wholly-owned subsidiary of UrtheCast.

UrtheCast is currently developing and pursuing its plans to build, launch and operate two satellite constellations, known as UrtheDaily™ and OptiSAR™, respectively (see "General Development of the Business – Three Year History – OptiSAR Constellation and – UrtheDaily Constellations"). In June 2015, UrtheCast first

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announced its plans to build, launch and operate the OptiSAR Constellation, which the Company expects to be comprised of 16 satellites in total (eight optical and eight Synthetic Aperture Radar ("SAR") satellites) flying in two orbital planes, with each plane consisting of four satellite pairs. Each pair consists of a high-resolution optical satellite offering video and pushbroom imaging and a dual-band, high-resolution SAR satellite comprised of X and L radar bands. By employing two orbital planes, the OptiSAR Constellation is expected to provide for high revisit rates in the mid-latitudes, while providing global coverage extending to the poles. Subject to UrtheCast financing the build and launch of the satellites in the first orbital plane, the first eight satellites of the OptiSAR Constellation are scheduled to begin operations in 2022.

In March 2016, UrtheCast announced its plans for the UrtheDaily Constellation, which management expects to be comprised of eight EO satellites and is designed to capture medium-resolution imagery of the Earth's entire landmass (excluding Antarctica) every day, producing machine learning-ready, scientific-grade data to help geoanalytics companies measure and monitor change on our planet. Subject to UrtheCast financing the build and launch of the first four UrtheDaily satellites, the UrtheDaily Constellation is scheduled to begin operations in 2020.

Revenues are currently generated by (i) direct data sales to institutional users (both commercial and government), (ii) the provision of engineering services, which includes niche areas of EO technology development, including technology licensing, training, paid research and development, and the creation of technology solutions for customers with specific requirements, and (iii) sales of other value-added services and imagery-related products.

Products and Services

Earth Observation

As described above, UrtheCast and its subsidiaries operate space-borne EO optical sensors, including the Deimos-1 and Deimos-2 satellites. UrtheCast acquired the Deimos-1 and Deimos-2 EO satellites in July 2015. Deimos-1 has a collection capacity of more than 5 million square kilometres per day, with a three-day average revisit time worldwide. The Deimos-2 satellite was launched in 2014 and provides 0.75-metre pan-sharpened images with a swath width of 12 kilometres. Deimos-2 has a collection capacity of more than 150,000 square kilometres per day, with a two-day average revisit time worldwide. Data captured by these sensors are downlinked to ground stations across the planet and displayed on the UrthePlatform, or distributed directly to partners and customers, supporting a wide range of information-rich applications and services. See "Risk Factors – Risks Related to the Operation of the Deimos-1 and Deimos-2 Satellites and the Expected Operation of the OptiSAR Constellation and the UrtheDaily Constellation". Certain imagery from these and other sensors, such as the Landsat-8 satellite, has now been made available on the UrthePlatform. See "General Development of the Business – Three Year History –UrthePlatform Development". UrtheCast also processes and distributes imagery data and value-added products on behalf of the PanGeo Alliance, a network of eight EO satellite operators with a combined 15 medium- and high-resolution EO sensors, formed and led by Deimos Imaging, S.L.U. a wholly-owned subsidiary of UrtheCast.

UrtheCast's business development and sales team has been engaged in servicing and building up the sales funnel for the Company's EO business. First, direct sales of imagery data from UrtheCast's EO sensors and those of PanGeo Alliance members fit into the data sales portion of the EO industry, a commercial market which Euroconsult SA, a consulting and analysis firm specializing in satellite applications, communications, and digital broadcasting ("Euroconsult"), estimated to total US$1.7 billion globally in 2015. This includes sales directly to end-users and sales to data distributors who then distribute imagery content to end-users in their respective markets. The integrated business development and sales team of UrtheCast and Deimos Imaging are selling the diversified imagery dataset offering created by the combined company, as well as product from PanGeo Alliance members. Revenue generated from sales of raw EO imagery data or its derivatives into the existing EO market to commercial and government institutional customers began in 2015 and totaled $15.2 million in the 2016 financial year. For more information, see UrtheCast's Annual Financial Statements for the fiscal year ended December 31, 2016.

Engineering Services

This component of the business is primarily focused on the development of key technologies that support UrtheCast's EO business. This has included the acquisition, launch and commissioning of the sensors currently operational on the ISS, as well as development of the required ground infrastructure, including the large cloud-based

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software infrastructure and applications for imagery processing and distribution. Currently, the Engineering Services Division is focused on the development of key technologies for UrtheCast's future sensors, including the proposed OptiSAR Constellation, and servicing the engineering services contracts described below.

UrtheCast's engineering capability in the EO field is such that certain customers make use of UrtheCast's capability to acquire solutions for their own use and to develop their own capabilities. The Engineering Services Division is therefore able to largely self-fund its activities by the sale of such engineering services. UrtheCast has signed a five-year contract with a confidential customer for the provision of engineering and value-added services and Earth imagery data valued at US $65 million as well as a contract with an international customer valued at US $9 million and US $3.9 million to provide space hardware and engineering services. See above under the heading "General Development of the Business – Three Year History – Engineering Services".

The Company has also successfully bid for and won various government funding commitments for the performance of research and development or engineering services work, including $3.2 million in support of the Canadian Space Agency. As of December 31, 2016, aggregate funding commitments totaled $8.2 million, of which $4.2 million has not yet been received.

Geoanalytics

UrtheCast is entering the nascent market for "highly-derived" geoanalytics services and applications, including through the design and build-out of the UrthePlatform and strategic relationships with leading analytics companies, such as GEOSYS and OmniEarth, Inc. As noted above, in December 2015, the UrthePlatform entered beta and now offers access to users and developers. The UrthePlatform's users have access to UrtheCast's cloud-based suite of APIs and developer tools that help them access, integrate and analyze certain EO imagery data to enable data-driven decision-making. Currently, Area of Interest (AOI), Map Tiles, Archive, Events, Ordering and Satellite Tracker APIs are offered and allow users to programmatically save and track AOIs, monitor changing activity in their interest area, render satellite data onto any standard mapping library and download this data for more rigorous analytical activities. See "Risk Factors – Risks Related to Failure to Gain Market Acceptance".

Market

The imagery data generated from UrtheCast's sensors are used to generate revenue from EO data sales. Conventional data sales are made up of archival EO imagery and data sales and orders to acquire new EO imagery data and value-added products. However, there is no guarantee that the market for conventional data sales will be receptive to UrtheCast's future products or continuing growing as the Company expects. See "Risk Factors – Risks Related to Failure to Gain Market Acceptance". Below is a description of each current and anticipated revenue stream and the underlying target market. As with any developing technology company, there are unidentified revenue streams that may surface as the Company grows.

Earth Observation Data Sales

The market for EO data sales is a well-established and growing industry. In their 2015 report "Satellite-Based Earth Observation Market Prospects to 2023", Euroconsult valued the global commercial EO market at approximately US$1.7 billion in 2015 and forecasted that it will reach $3.6 billion by 2023. As remote sensing becomes more affordable and technologically advanced, demand for EO data is expected to increase. Organizations are realizing the benefits of having such imagery data available to them and global collaborations with companies such as UrtheCast are expected to spark creativity and growth in the commercial space sector to find additional uses for EO data, value- added products and services and related content.

In addition, many government customers have consistent and on-going requirements for EO imagery to supervise and manage, among other things, resources, animal migrations and national borders. EO observation data is also used by government agencies and non-governmental organizations to track environmental changes, natural disasters and human conflicts.

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UrtheCast has an established customer base across Europe, North America and Latin America, including the European Space Agency ("ESA"), the European Commission, various European governmental agencies, and commercial customers around the world in the agricultural, forestry and land use industries, among others.

As noted above under the heading "Products and Services – Earth Observation", UrtheCast processes and distributes imagery data and value-added products on behalf of the PanGeo Alliance, which allows UrtheCast to sell imagery data and value-added products to its customers that are derived from an additional 15 medium- and high- resolution EO sensors owned by other members of the PanGeo Alliance. These additional sensors enable the Company to leverage underutilized space assets, diversify its sources of raw imagery, increase its revenue stream from EO data sales and access new market segments that are not serviced by the sensors owned and operated by UrtheCast. See "Risk Factors – Risks Related to the PanGeo Alliance".

UrtheCast also offers its imagery products to news and media organizations and other entities with large content requirements. For example, should the sensors be covering a geographic region when an earthquake or tsunami hits, that content could be sold to news agencies wishing to have timely and exclusive coverage. UrtheCast has also worked with major international brands, such as Heineken® and Pepsi®, to provide imagery and video for marketing campaigns. See above under the heading "General Development of the Business – Three Year History".

Engineering Services

UrtheCast performs engineering work both to support its EO data sales business and to provide engineering services to third parties. This includes the design and acquisition of space- and ground-based equipment, as well as the development of the large, cloud-based software infrastructure needed to process and distribute data to customers. However, many customers in the industry do not have this engineering capability, so UrtheCast is able to sell engineering services to such customers, either in direct support of their acquisition of space or ground hardware or software, or by performing training or other services.

In addition to customers of the nature described above, UrtheCast's Engineering Services Division is also able to perform technology development in support of traditional space agencies, such as the Canadian Space Agency. UrtheCast has completed a number of projects of this nature, and is currently performing several more. These projects provide ancillary sources of funding for UrtheCast's primary technology development activities.

Geoanalytics

As noted above, UrtheCast is entering the growing market for geoanalytics services and applications, including through the design and build-out of the UrthePlatform. According to MarketsandMarkets, a global market research and consulting firm in its February 2015 report entitled "Geospatial Analytics Market by Type (Surface Analysis, Network Analysis, Geovisualization), Technology, Application, Vertical, Region (Europe, North America, Asia-Pacific, Middle East & Africa, Latin America) – Global Forecast to 2020", the global geospatial analytics, or "geoanalytics", market size is estimated to grow from approximately US$27 billion in 2015 to approximately US$72 billion by 2020. Geoanalytics is at an early-stage, but just as the satellite communications and satellite navigation segments of the space industry have become largely subsumed in much bigger and more transformational commercial industries, UrtheCast believes there are many signs that EO industry has reached an inflection point and is similarly about to become part of a "big-data" geo-information and geoanalytics information services industry. In particular, UrtheCast believes geoanalytics will be a rapidly-growing part of the broader big-data predictive analytics markets and will emerge at the nexus of remotely-sensed change detection, location-based analytics services, machine-learning and ‘big-data’ algorithmic processing of information. UrtheCast believes that EO-enabled geoanalytics will allow for the discovery and exploitation of information hidden within huge volumes of traditional EO imagery, rather than just the imagery itself, and that the combination of this information with other datasets will allow for better decision- making at large scales.

There are a few key trends UrtheCast believes are driving this transformation: a reduction in the cost of building and launching satellites, including so-called small- and medium-sats that can be launched in groups and operated in tandem as part of a constellation; the emergence of massively scalable, low-cost cloud computing for image analysis, processing and distribution; rapid growth in demand for ‘big-data’ information solutions in a variety of sectors, including agriculture, forestry, water management, mining, infrastructure planning, environmental

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monitoring, transportation, shipping, security, taxation, industrial production, urban planning, traffic, and insurance; and developments in geo-analytics software algorithms to deliver the analysis and predictive analytics those sectors are demanding.

UrtheCast believes that these trends indicate that high quality and frequently updated EO imagery, provided by a constellation of small-sats, which is rapidly processed and analyzed using ‘big-data’ analytics, has the potential for massive usage, and an equally large market size. UrtheCast is being built from the ground up to capitalize on these trends, moving from providing traditional EO imagery to providing increasingly sophisticated information products and services for the ‘big-data’ geo-information market. For example, UrtheCast has already begun designing and building a vertically-integrated ‘big-data’ geospatial and geoanalytics collection, processing, and information management system using its current sensors and the UrthePlatform, and expects to expand this with the unique imagery to be provided by the OptiSAR Constellation and the UrtheDaily Constellation. In particular, the UrtheDaily Constellation is designed to capture medium-resolution imagery of the Earth’s entire landmass (excluding Antarctica) every day, producing machine learning-ready, scientific-grade data to help UrtheCast and other geoanalytics companies measure and monitor change on our planet, and ultimately help to address some of Earth’s biggest challenges, at scale.

Distribution – EO Data Sales

As of the date of this AIF, UrtheCast and Deimos Imaging have entered into data distribution and reseller agreements with distributors in Asia, North America, South America, the Middle East and Europe. The Company and Deimos Imaging also employ regional sales managers who are responsible for growing the Company's distribution network and work with its distributors to close orders from end customers in their respective regions. UrtheCast and Deimos Imaging also work directly with many end-customers to fulfill imagery orders. See "Risk Factors – Risks Related to Dependence on Foreign Data Distributors".

UrtheCast also processes and distributes imagery data and value-added products on behalf of the PanGeo Alliance, a network of eight EO satellite operators with a combined 15 medium- and high-resolution EO sensors, formed and led by Deimos Imaging, S.L.U. a wholly-owned subsidiary of UrtheCast. See "Risk Factors – Risks Related to the PanGeo Alliance".

Marketing Plan and Strategy

UrtheCast currently markets itself using direct marketing, such as conferences and trade shows that focus on the EO industry, geoanalytics, new technology, internet-based communications and space-related activities. UrtheCast also uses its blog, its social media properties and its website to communicate with its current and potential customers, generate sales leads and demonstrate thought leadership in the industry. See "Risk Factors – Risks Related to Failure to Gain Market Acceptance". UrtheCast’s marketing materials focus on topics such as geoanalytics, agriculture, the environment, and other space-related activities and is also used to present information pertaining to UrtheCast, such as recent imagery acquired by UrtheCast's or PanGeo Alliance sensors and new products and services. UrtheCast will continue to evolve its traditional and digital marketing activities and tools going forward.

Monetization and Pricing

Traditional imagery products and other value-added products and services derived from EO imagery are priced competitively in each market segment to compete with leading industry competitors, including through public tendering processes. Revenues from sales of PanGeo Alliance sensors are shared among applicable PanGeo Alliance members involved in the relevant transaction. See "Risk Factors – Risks Related to the PanGeo Alliance". UrtheCast's UrthePlatform monetization is early in its evolution and pricing and monetization remains highly subject to ultimate consumer engagement levels that are not known today. Currently, some of UrtheCast's web services, such as advanced API access and imagery data (GeoTIFF files) are addressed with a tiered-pricing offer. Future product and service offerings are currently being explored. See "Risk Factors – Risks Related to Failure to Gain Market Acceptance".

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Specialized Skill and Knowledge

UrtheCast's global team is comprised of leading ground segment operators, software developers, designers, GIS experts, engineers, imagery scientists and aerospace and web services professionals who are passionate about realizing UrtheCast's vision to democratize Earth observation imagery. UrtheCast's management and employees have extensive experience and longstanding working relationships with the Canadian, Russian and European space agencies, the U.S. National Geospatial-Intelligence Agency and Elecnor Deimos Space, one of Europe's leading space companies. See "Risk Factors – Risks Related to UrtheCast's Directors, Officers and Employees".

Competitive Conditions

UrtheCast's current and proposed products and services compete, and are expected to compete, with satellite and aerial imagery and related value-added products and services offered by a range of commercial providers including DigitalGlobe, Inc., MacDonald Dettwiler & Associates Ltd., ImageSat International N.V., Airbus Defence and Space, Planet, Inc. as well as numerous aggregators of imagery and imagery-related products and services, including Google and Microsoft. Foreign governments, including India, South Korea and Taiwan also sell their data commercially. In addition, UrtheCast, along with other providers of EO imagery, expects to compete against providers of high- resolution aerial imagery, such as Pictometry International Corp. Aerial imagery providers can provide higher resolution and more customized imagery when compared to EO providers, but have a more limited image collection capacity within their airplane, drone or similar platform and require regulatory approvals to operate in sovereign airspace. In contrast, EO imagery companies typically have greater collection capacity and possess the ability to repeatedly pass over a geographic region without violating sovereign airspace regulations.

UrtheCast's competitive advantages today flow from its lower cost operating structure when compared to traditional EO data providers, the high barriers to entry inherent in the space industry, the operational track record of Deimos Imaging, its strong focus on customer service and the combined sales footprint of the now fully-integrated two companies (UrtheCast and Deimos Imaging). With its integrated, highly efficient sales structure and its unique and diverse product offering made possible by the PanGeo Alliance, UrtheCast believes it possesses a compelling integrated service offering. The wide swath and frequent coverage of Deimos-1, for example, can be used to detect and in some cases to "cue" the higher resolution Deimos-2. See "Risk Factors – Competition and Loss of Market Share" and "Risk Factors – Risks Related to the PanGeo Alliance".

The OptiSAR Constellation is expected to be a first-of-its-kind commercial EO constellation with optical and SAR sensors, providing what the Company anticipates to be unique space-imaging capabilities, including high collection capacity, unique optical and SAR data fusion, weather-independent high-resolution imaging using the SAR, frequent target revisit, and minimized imaging latency. The tandem formations are also expected to offer a number of innovative capabilities, including onboard real-time processing, cross-cueing between the satellites, and real-time cloud detection on the leading SAR satellites to enable cloud-cover avoidance in the trailing optical satellites. By employing two orbital planes, the OptiSAR Constellation will allow for maximum revisit rates in the mid-latitudes, while providing the Company with global coverage extending to the poles. See "General Development of the Business – Three Year History – OptiSAR Constellation".

The UrtheDaily Constellation is a planned global coverage constellation aiming to acquire high-quality, multispectral imagery, at a ground sampling distance of five metres, taken at the same time, from the same altitude every day. UrtheCast believes the UrtheDaily Constellation presents a disruptive and problem-solving technology that will transform the way we observe our planet. The spacecraft, constellation and operations approach of the UrtheDaily Constellation is expected to enable ultra-high sensor spectral calibration targeted specifically at geoanalytics applications to optimize the ability to reliably extract information from the imagery and to detect even subtle changes on the planet. The spectral bands of the optical sensors expected to be used in satellites comprising UrtheDaily Constellation have been selected to match Landsat-8/Sentinel-2/RapidEye/Deimos-1 bands to ease the constant and automatic in-flight cross-calibration with trusted references, minimize the effects due to atmospheric variations, and to provide improved accuracy of key information products. UrtheCast believes this approach will facilitate adoption of imagery from the UrtheDaily Constellation by users with experience using these legacy sensors. See "General Development of the Business – Three Year History – UrtheDaily Constellation".

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Strategic Relationships

UrtheCast has structured strategic relationships with global leaders in space technology, EO imaging, advanced imagery data processing, ground segment infrastructure and satellite construction.

SSTL

UrtheCast's strategic implementation partner for the design of certain components and the build of the satellites in its planned UrtheDaily Constellation and OptiSAR Constellation is UK-based SSTL, the world's leading smallsat manufacturer, owned by Netherlands-headquartered Airbus Group SE.

PanGeo Alliance

UrtheCast cooperates closely with members of the PanGeo Alliance, a network of eight EO satellite operators with a combined 15 medium- and high-resolution EO sensors, to process and distribute imagery data and value-added products derived from this diverse suite of sensors. The PanGeo Alliance was co-founded and is led by Deimos Imaging, a wholly-owned subsidiary of UrtheCast, and includes Astro Digital, Dauria Aerospace, Kazakhstan Gharysh Sapary, Beijing Space Eye Innovation Technology, Mohammed Bin Rashid Space Centre and ST Electronics (Satcom & Sensor Systems). See "Risk Factors – Risks Related to the PanGeo Alliance".

Elecnor Deimos Space

At the completion of the Deimos Acquisition, UrtheCast and Elecnor Deimos Space, a subsidiary of Elecnor, signed a Mutual Cooperation Agreement that will allow the companies to look for opportunities in the market for mutual benefit. Elecnor Deimos Space will be the exclusive provider for receiving stations for the Deimos-1 and Deimos-2 satellites. Also, under this agreement, the companies expect to work together on the OptiSAR Constellation including in the areas of the headquarter mission control centre, direct tasking and receiving ground stations, mission analysis and flight dynamics, and in the integration and testing of the SAR payloads.

In addition, at the completion of the Deimos Acquisition, Deimos Castilla La Mancha, S.L.U. ("DCM"), a wholly-owned subsidiary of Elecnor, DOT Imaging, S.L.U. (now owned by UrtheCast), Elecnor Deimos Space and Elecnor entered into a service level agreement (including certain statements of work thereunder, the "Service Level Agreement"), pursuant to which DCM and Elecnor Deimos Space are obligated to provide services and premises to Deimos Imaging that are necessary in connection with the use of the Deimos-2 satellite and related operations. Certain of these services will be provided in connection with the ground segment hardware in respect of the Deimos-2 satellite, including the antenna located in Puertollano, Spain, which continue to be owned by DCM in order to ensure compliance with the terms of the Government Subsidies (as defined below under "Risk Factors – Risks Related to Government Subsidies"). Given the critical nature of the services to be rendered to DOT Imaging, the subcontracting of services under the Service Level Agreement to a third party is subject to Deimos Imaging's consent and any proposed assignment or change of control of any of DCM, Elecnor Deimos Space or Elecnor is also subject to DOT Imaging's prior consent and notification. In addition, DCM and Elecnor Deimos Space are only permitted to terminate the Service Level Agreement for cause and Elecnor does not have any rights to terminate the Service Level Agreement.

Energia and Roscosmos

In 2012, UrtheCast signed a unique and exclusive contract with Energia, which has full operational control of the Russian segment on the ISS. Energia committed to providing the prelaunch preparation, launch, installation, and maintenance of the MRC and HRC cameras, as well as telemetry, command and downlink data communications infrastructure on the Russian segment of the ISS. Energia and UrtheCast signed an original Memorandum of Understanding early in 2011, followed by a joint venture agreement in the spring of 2011. An official sealed resolution was issued by the Russian Federal Space Agency ("Roscosmos") in October 2011. This resolution officially approved the joint venture with UrtheCast and Energia. The technical contract was entered into in the spring of 2012; this contract is an operational document that is continually updated during engineering sessions.

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On January 1, 2016, the Russian government dissolved Roscosmos and replaced it with the Roscosmos State Corporation for Space Activities ("Roscosmos State Corporation"), a Russian state-owned company which has taken over responsibility for Russia's space programs. The reorganization of the Russian space sector by Roscosmos State Corporation is ongoing.

UrtheCast's Russian partners provided significant 'in-kind' contributions to the cost of the project, such as hardware integration, crew training, hardware delivery to the ISS, provision of a pointing platform, maintenance, extra vehicular space walks, power supply to the cameras, ISS real estate, downlinking, a ground system network, as well as the costs of operating and delivering UrtheCast's tasking or operating instructions to the HRC and MRC sensors aboard the ISS, as such communications are controlled by Energia using the ISS MCC system. In return for these contributions to the project, NZ OMZ (as successor to BARL and in its capacity as the operator of EO operations for the Russian government) received certain rights to the imagery, for use by Russian government agencies, over the life of the project.

On November 10, 2016, the Company announced that Energia had advised UrtheCast it would be terminating the existing agreement on December 31, 2016 and that a new arrangement would need to be negotiated for the program's continuation, including permitting UrtheCast to task the ISS Cameras. The Company does not expect that a new commercial arrangement can be reached with Energia and as a result, the Company is seeking to monetize these assets through alternative means, including licensing arrangements or an asset sale. See "Risk Factors – Risks Related to Reliance on Key Agreements and Relationships", "Risk Factors – Risks Related to Operating in Foreign Jurisdictions and Political Developments and Uncertainty in the Russian Federation" and "Risk Factors – Risks Related to a Sale or Licensing Arrangement in Respect of the ISS Cameras".

Components

UrtheCast has established relationships with a number of organizations, including SSTL and Elecnor Deimos Space. Each of these entities is a large, well-established company offering secure supplies and ready availability of components. See "Description of the Business – General – Strategic Relationships", above. UrtheCast also relies on Amazon Web Services ("AWS") for critical components of its ground segment infrastructure, including cloud storage, backups, disaster recovery and image processing servers. See "Risk Factors – Risks Related to Reliance on Key Agreements and Relationships" As some of the components that UrtheCast procures are denominated in the British pound sterling, Euros and U.S. dollars, the costs of these components are subject to foreign currency risk. See "Risk Factors – Risks Related to Currency Exchange Rate Risk".

Intellectual Property

In accordance with industry practice, the Company currently protects its proprietary rights through a combination of copyright, trade-mark, patents, trade secret laws and contractual provisions. The source code for the Company's web-platform software is protected under Canadian and applicable international copyright laws.

Patent applications are filed in various jurisdictions internationally, which are carefully chosen based on the likely value and enforceability of intellectual property rights in those jurisdictions, and to strategically reflect UrtheCast's anticipated major markets. Patents provide UrtheCast with a potential right to exclude others from incorporating UrtheCast's technical innovations into their products and processes. Where appropriate, UrtheCast licenses third party technologies to provide UrtheCast with the flexibility to adopt preferred technologies. As of December 31, 2016, UrtheCast has filed nine patent applications relating to UrtheCast's inventions, including nine international Patent Cooperation Treaty ("PCT") patent applications. The PCT applications preserve UrtheCast's right to file corresponding patents in jurisdictions that are parties to the PCT, which includes most of the major industrialized countries. The scope of protection obtained, if any, from the Company's current or future patent applications may not be known for several years. Moreover, there is no guarantee that any patents will be issued with respect to any such patent applications, and if patents are issued, they may not provide the Company with the expected competitive advantages, or they may not be issued in a manner that gives the Company the protection that it seeks, or they may be successfully challenged by third parties.

The Company also seeks to avoid disclosure of its intellectual property and proprietary information by requiring employees and consultants to execute non-disclosure and assignment of intellectual property agreements.

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Such agreements also require UrtheCast's employees and consultants to assign to the Company all intellectual property developed in the course of their employment or engagement. The Company also utilizes non-disclosure agreements to govern interaction with business partners and prospective business partners and other relationships where disclosure of proprietary information may be necessary, and the Company take measures to carefully protect UrtheCast's intellectual property rights in UrtheCast's collaboration and supply chain agreements.

UrtheCast's software includes software components licensed from third parties including open source software. The Company believes that it follows industry best practices for using open source software, and that replacements for third party licensed software are available either as open source software or on commercially reasonable terms.

UrtheCast has filed for several trade-mark applications and has received some registration certificates, including for "URTHECAST", "URTHE" and "URTHECAST Design" in Canada, the United States and certain other jurisdictions. The Company has registered and maintains the registration of a variety of Internet domain names that include "urthecast" or variations thereof.

The enforcement of UrtheCast's intellectual property rights also depends on any legal actions against any infringers being successful, but these actions may not be successful or may be prohibitively expensive, even when the Company's rights have been infringed. See "Risk Factors – Risks Related to Intellectual Property".

Economic Dependence

The Company entered into an exclusive contract with Energia, the operator of the Russian segment of the ISS, for the pre-launch preparation, launch, installation, maintenance and certain aspects of operating UrtheCast's MRC and HRC. This agreement has now been terminated and UrtheCast is seeking to sell, license or otherwise monetize the ISS Cameras. See "Description of the Business – General – Strategic Relationships" and "Risk Factors – Risks Related to a Sale or Licensing Arrangement in Respect of the ISS Cameras". In addition, the Company has entered into a five-year contract with a confidential customer for the provision of engineering and value-added services and Earth imagery data valued at US $65 million. The Company has also entered into an agreement with SSTL in respect of the design and build of certain pre-flight components of the OptiSAR Constellation and views SSTL as a strategic implementation partner in the development and construction of the OptiSAR Constellation and, potentially, the UrtheDaily Constellation. See "Risk Factors – Risks Related to Reliance on Key Agreements and Relationships" and "Risk Factors – Risks Related to Operating in Foreign Jurisdictions and Political Developments and Uncertainty in the Russian Federation".

Employees

At the end of the fiscal year on December 31, 2016, UrtheCast including its subsidiaries, had 246 employees, of which 112 employees were located in Vancouver, British Columbia, three employees were located in San Francisco, California, eight employees were located in St. Louis, Missouri, five employees worked remotely from various other locations in the Unites States, 67 employees were located in Boecillo, Spain, 30 employees were located in Madrid, Spain and 21 employees were located in Puertollano, Spain.

Optimization of the overall workforce in early 2017 resulted in reductions in the number of employees at each office location. As of the date of this AIF, UrtheCast, including its subsidiaries, has 222 employees, of which 107 employees are located in Vancouver, British Columbia, two employees are located in St. Louis, Missouri, four employees work remotely from various other locations in the Unites States, 65 employees are located in Boecillo, Spain, 28 employees are located in Madrid, Spain and 16 employees are located in Puertollano, Spain.

None of UrtheCast's employees are represented by a collective bargaining agreement and the Company has never experienced any work stoppage. The Company considers its relations with its employees to be good. In addition, the Company views its employees as an important competitive advantage. Thus far, the Company has been successful in retaining its key employees including members of its management team. UrtheCast's management team has an in- depth knowledge of the Company's target vertical markets, and of the geo- imaging and aerospace industry in general. See "Risk Factors – Risks Related to UrtheCast's Directors, Officers and Employees".

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Foreign Operations

The Company has two offices in Vancouver and three offices in Spain (Boecillo, Madrid and Puertollano), as well as various employees working remotely from various other locations worldwide, including the United States.

In addition, the Company, including its subsidiaries, has data distribution agreements with third party distributors in dozens of countries spanning six continents.

For the fiscal year ended December 31, 2016, most of the Company's expenses were incurred in Canada. However, some of the Company's transactions occur in foreign jurisdictions, resulting in expenses being charged, and revenue being received, in foreign currencies, including the U.S. dollar and the Euro. During 2016, the Company entered into forward contracts to fix the exchange rate on future supplier payments of £9,320,000 related to its OptiSAR Constellation development program. Excluding this, the Company has not hedged its exposure to currency fluctuations affecting future international revenues, expenses and other commitments. Accordingly, currency exchange rate fluctuations may cause variability in the Company's expected foreign currency denominated revenue streams, expenses, and any costs to settle foreign currency denominated liabilities. In particular, the Company expects to continue to incur a greater portion of its expenses in Canadian dollars and Euros relative to the amount of revenue it expects to receive in Canadian dollars and Euros so fluctuations in the Canadian-U.S. dollar exchange rate, the Canadian-Euro exchange rate, and the Euro-U.S. dollar exchange rate could have a material effect on the Company's business, results of operations and financial condition. See "Risk Factors – Risks Related to Dependence on Foreign Data Distributors", "Risk Factors – Risks Related to Operating in Foreign Jurisdictions and Political Developments and Uncertainties in the Russian Federation" and "Risk Factors – Risks Related to Currency Exchange Rate Risk".

RISK FACTORS

An investment in UrtheCast is speculative and involves a high degree of risk due to the nature of the Company's business and the present stage of its development. The following risk factors, as well as risks not currently known to the Company, could materially adversely affect the Company's future business, operations and financial condition and could cause them to differ materially from the estimates described in forward-looking statements contained herein. By their nature, forward-looking statements involve numerous assumptions and known and unknown risks and uncertainties, of both a general and specific nature, that could cause actual results to differ materially from those suggested by the forward-looking statements or contribute to the possibility that predictions, forecasts or projections will prove to be materially inaccurate. Prospective investors should carefully consider the following risk factors along with the other matters set out herein:

Risks Related to the Operation of the Deimos-1 and Deimos-2 Satellites and the Expected Operation of the OptiSAR Constellation and the UrtheDaily Constellation

If Deimos-1, Deimos-2 or the satellites to comprise UrtheCast's planned OptiSAR Constellation or the UrtheDaily Constellation (together, in this section, the "Satellites") fail to operate as intended, UrtheCast's ability to collect imagery and market its current and proposed products and services successfully could be materially and adversely affected. The Satellites employ, or are expected to employ (in the case of the OptiSAR Constellation and UrtheDaily Constellation), advanced technologies and sensors that are exposed to severe environmental stresses in space that could affect the Satellites' performance. Hardware component problems in space could lead to deterioration in performance or loss of functionality of a Satellite, with attendant costs and net revenue losses. In addition, human operators may execute improper implementation commands that may negatively impact a Satellite's performance. Exposure of the Satellites to an unanticipated catastrophic event, such as a meteor shower or a collision with space debris, could reduce the performance of, or completely destroy, the affected Satellite.

UrtheCast cannot provide any assurance that the Satellites will continue to operate, in the case of Deimos-1 and Deimos-2, or will operate at all, in the case of those expected to comprise the OptiSAR Constellation or the UrtheDaily Constellation, successfully in space throughout their expected operational lives. Even if a Satellite is operated properly, technical flaws in that Satellite's sensors or other technical deficiencies or anomalies could significantly hinder its performance, which could materially affect UrtheCast's ability to collect imagery and market

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its current and expected products and services successfully. While some anomalies are or may be covered by insurance policies, others are not or may not be covered, or may be subject to large deductibles.

If UrtheCast suffers a partial or total loss of a deployed Satellite, or of a Satellite during launch, it would need a significant amount of time and would incur substantial expense to replace that Satellite, which may not be covered by satellite operations or launch insurance. UrtheCast may experience other problems with the Satellites that may reduce their performance. During any period of time in which a Satellite is not fully operational, UrtheCast may lose most or all of the net revenue that otherwise would have been derived from that Satellite. In addition, UrtheCast may not have on hand, or may be unable to obtain in a timely manner, the necessary funds to cover the cost of any necessary replacement of such Satellite. UrtheCast's inability to repair or replace a defective Satellite or correct any other technical problem in a timely manner could result in a significant loss of net revenue.

Risks Related to the PanGeo Alliance

As discussed above under heading "Description of the Business – Earth Observation Data Sales", UrtheCast also processes and distributes imagery data and value-added products on behalf of the PanGeo Alliance, a network of eight EO satellite operators with a combined 15 medium- and high-resolution EO sensors. The Company expects that a material portion of its EO business revenue will be derived from the distributor and value-added services it provides on behalf of, or in partnership with, other satellite operators in the PanGeo Alliance. As a result, a breakdown in the commercial relationships with other members of the PanGeo Alliance, the termination of any distribution, reseller or value-added services agreements with such members or the termination of the PanGeo Alliance altogether may materially reduce the Company's anticipated revenues and could have a material adverse effect on its business, financial condition and results of operations.

Risks Related to Reliance on Key Agreements and Relationships

Due to the nature of the services to be rendered to Deimos Imaging by Deimos Castilla La Mancha, S.L.U. ("DCM"), Deimos Space, S.L.U. ("Elecnor Deimos Space") and Elecnor, S.A. pursuant to the Service Level Agreement, as described under the heading "Description of the Business – General – Strategic Relationships", any failure by DCM or Elecnor Deimos Space to meet their obligations under the Service Level Agreement would have a material adverse effect on the value of Deimos Imaging and UrtheCast.

In addition, the Company has also entered into a contract dated November 24, 2014, as amended, for US $65 million to provide engineering services to a confidential customer over a five-year period. A break down in the relationship with this confidential customer, or the termination of the contract with them, may materially reduce the Company's anticipated revenues and could have a material adverse effect on its business, financial condition and results of operations. Similarly, on January 10, 2017, UrtheCast announced that it had entered into a contract with an international customer valued at US $3.9 million relating to the provision by UrtheCast of certain engineering services and related space hardware. The loss of this customer could materially reduce the Company's anticipated revenues and could have a material adverse effect on its business, financial condition and results of operations.

As further described in "General Development of the Business – Three Year History – OptiSAR Constellation", the Company recently announced that it had entered into an agreement with a confidential government customer for the sale and shared operation of the first two satellites in the OptiSAR Constellation for a purchase price of US$180 million. The loss of this agreement or the inability of UrtheCast or the customer to satisfy its conditions precedent or other covenants could materially reduce the Company's anticipated revenues and delay or impede the financing, build, launch and/or operation of the OptiSAR Constellation.

As further described in "General Development of the Business – Three Year History – UrtheDaily Constellation", the Company recently announced that it had entered into an agreement with GEOSYS in respect of GEOSYS’ commitment to purchase imagery data expected to be derived from the UrtheDaily Constellation. As GEOSYS is an anchor customer of the UrtheDaily Constellation and this contract represents the largest single data purchase contract in the Company’s history, the loss of this agreement or the inability of UrtheCast to satisfy its conditions precedent or other covenants, could materially reduce the Company's anticipated revenues and delay or impede the financing, build, launch and/or operation of the UrtheDaily Constellation.

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The Company has also entered into an agreement with SSTL in respect of the design and build of certain pre- flight components of the OptiSAR Constellation and views SSTL as a strategic implementation partner in the development and construction of the OptiSAR Constellation and, potentially, the UrtheDaily Constellation. This is a significant relationship, and the deterioration of the relationship or any failure by SSTL to fulfill its obligations to UrtheCast could affect UrtheCast's ability to complete the OptiSAR Constellation or the UrtheDaily Constellation and could have a material adverse impact on UrtheCast's business and operations should a suitable replacement contractor be unable to provide similar services.

As noted under the heading "Description of the Business – General – Components", UrtheCast relies on AWS for critical components of its ground segment infrastructure. AWS provides a distributed computing infrastructure platform for business operations, or what is commonly referred to as a "cloud" computing service. UrtheCast has architected its software, computer systems and ground segment system so as to utilize data processing, storage capabilities and other services provided by AWS. Currently, UrtheCast runs the vast majority of its computing on AWS. Given this, along with the fact that UrtheCast cannot easily switch its AWS operations to another cloud provider, any disruption of or interference with its use of AWS would impact the Company's operations and its business would be adversely impacted.

Risks Related to Delays in the Development and Launch of the OptiSAR Constellation or UrtheDaily Constellation

Any program delays encountered in the design, construction, launch and operational commissioning of the Company's proposed OptiSAR Constellation or the UrtheDaily Constellation (together in this "Risk Factors" section, the "Constellations") may require UrtheCast to continue and increase its reliance on the Deimos-1 and Deimos-2 satellites to meet its business needs, which could have a material adverse effect on its business, financial condition and results of operations. In addition, any delays in the design, build, launch and commissioning of the OptiSAR Constellation may adversely affect the Company's ability to satisfy the first binding contract for US$180 million discussed above and to convert the Company's MOUs with its OptiSAR Constellation implementation partners into binding, definitive agreements, and as a result, its ability to finance the development, building, launch and commissioning of the OptiSAR Constellation without additional financing. Similarly, any delays in the development, build, launch or commissioning of the UrtheDaily Constellation may result in the Company breaching its covenants under its agreement with GEOSYS described above under the heading "General Development of the Business – Three Year History –UrtheDaily Constellation" and therefore release GEOSYS from its obligation to purchase imagery data derived from the UrtheDaily Constellation. Any financing to fund the build, launch and commissioning of the Constellations might not be available on economically favorable terms, or at all. If the Company does not generate sufficient cash flow from operations, and additional financings, borrowings or refinancings, or proceeds of asset sales are not available to it, the Company may not have sufficient cash to enable it to continue or complete the design, construction, launch and operational commissioning of the Constellations.

The Company is in the process of designing and developing the Constellations. UrtheCast currently expects to launch the first eight satellites in OptiSAR Constellation in late 2021 and the first four satellites in the UrtheDaily Constellation in late 2019. The design, manufacture, testing, launch and commissioning of the Constellations involve complex processes and technology. UrtheCast is relying, and will continue to rely, on third party contractors for the manufacture, testing (of certain components) and launch of the Constellations. Many factors, including, but not limited to, unavailability of parts, subcontractor and supplier delays and anomalies discovered during testing, may result in significant delays to each Constellation program.

In addition, launch windows and specific dates, once scheduled, are subject to change and may be materially delayed for reasons beyond UrtheCast's control, including intervening launch failures of other satellites, reduced availability of launch facilities and support crew, weather and preemption by certain government launches. The launches of the satellites comprising the Constellations is a complex process involving advanced technologies and explosive propellants, and could suffer partial or catastrophic failure during the launch, ascent or deployment phases. In addition, the satellites expected to comprise the Constellations may be damaged during their launch into orbit or during commissioning. There is no guarantee that the satellites that expected to comprise either the OptiSAR or UrtheDaily Constellations will not be damaged, or lost entirely, during their ascent into space. Should the satellites be damaged or lost, UrtheCast would incur significant costs in repairing or replacing the satellites, which may not be

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covered by insurance, and the commencement of the OptiSAR or UrtheDaily Constellation's operations could be delayed or prevented altogether.

After launch, the satellites comprising the Constellations must be calibrated and tested to confirm operational capability, a commissioning process that typically takes several months. The Constellations may not pass the operational commissioning tests or may not otherwise operate as required. For example, satellites may experience technical difficulties communicating with the ground antennas or collecting imagery in the same quality or volume that was intended. The failure to construct and launch the Constellations on the Company's currently proposed timeline or to achieve operational commissioning as expected, or at all, could affect the Company's ability to meet its obligations to GEOSYS and other purchasers of advanced data subscription agreements in respect of the UrtheDaily Constellation and under UrtheCast's agreements with the OptiSAR Constellation implementation partners, including its first binding contract for US$180 million discussed above, and the agreements with the remaining customers for satellites in the OptiSAR Constellation, should the Company's MOUs with certain of these parties be converted into binding, definitive agreements or additional binding, definitive agreements be entered into, and may otherwise limit the anticipated volume of imagery products and services available to meet the Company's business needs and plans, which could have a material adverse effect on its business, financial condition and results of operations.

Risks Related to a Sale or Licensing Arrangement in Respect of the ISS Cameras

As discussed under the heading "General Development of the Business – Three Year History – ISS Cameras" in 2012, UrtheCast signed a contract with Energia whereby Energia agreed to provide support and infrastructure for the telemetry, command and downlink data communications of the ISS Cameras on the Russian segment of the ISS. As discussed above, Energia terminated this agreement effective December 31, 2016. Since the Company requires the cooperation of Energia to operate its equipment on the Russian segment of the ISS, UrtheCast's ability to task the ISS Cameras, and particularly the HRC, and to downlink or otherwise obtain imagery using the ISS cameras, has been restricted as a result of Energia's termination of its agreement with UrtheCast. Moreover, UrtheCast's ability to monetize the ISS Cameras through alternative means, such as an asset sale, are also dependent, in part, on the ability of a purchaser to reach a commercial arrangement with Energia and/or Roscosmos regarding the shared operation of the ISS Cameras. There is no certainty such an arrangement can be reached with a prospective purchaser.

Moreover, if the ISS, MRC or HRC experiences problems or otherwise fails to operate as intended, the Company's ability to sell, license or otherwise monetize the ISS Cameras could also be materially and adversely affected, particularly since the Company is unable to repair the ISS itself. The ISS employs advanced technologies and sensors that are exposed to severe environmental stresses in space that could affect the ISS Cameras' performance. These environmental stresses could cause hardware component problems and lead to deterioration in performance or loss of functionality of the ISS or the ISS Cameras, which could impact the Company’s ability to sell, license or otherwise monetize the ISS Cameras. In addition, human operators may execute improper implementation commands that may negatively impact the ISS' performance and, as a consequence, the ISS Cameras' performance. The failure of ISS computers or component parts thereof, including equipment for communicating with the ground stations or collecting imagery in the same quality or volume that was intended, could lead to a loss of functionality of the ISS Cameras. Exposure of the ISS to an unanticipated catastrophic event, such as a meteor shower or a collision with space debris, could reduce the performance of, or completely destroy, the ISS and as a consequence, the ISS Cameras. Unforeseen or unscheduled changes to the ISS orbit could lead to technical difficulties in collecting data which could also reduce the value of the ISS Cameras. Even if the ISS Cameras and the ISS itself are operated properly, technical flaws in an ISS Camera, the mounting hardware or other technical deficiencies, as well as damage from space debris or installation, could significantly hinder the ISS Cameras’ performance, which could materially affect the Company’s ability to sell, license or otherwise monetize the ISS Cameras. If the Company suffers a partial or total loss of the HRC and/or MRC, then due to the termination of Energia’s commercial arrangement with UrtheCast in respect of the ISS Cameras, UrtheCast will be unable to replace such affected camera.

There is no guarantee that the ISS, MRC or HRC will continue to operate successfully, or that the ISS will continue to be funded by the participating nations and governments or that such participating nations will continue to cooperate in respect of the operations of the ISS, until a sale or licensing arrangement in respect of the ISS Cameras can be completed. If the Company is unable to sell, license or otherwise monetize the ISS Cameras, this would result in a further write-down of these assets and could have an adverse effect on the Company’s business, financial condition and results of operations.

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Risks Related to Negative Cash Flows

The Company had negative cash flows from operations in its financial year ended December 31, 2016. Although the Company anticipates that it will have positive cash flows from operations in future periods, the Company cannot guarantee that it will have a cash flow positive status. To the extent that the Company has negative operating cash flows in future periods, it may need to deploy a portion of its existing working capital to fund such negative cash flow.

Risks Related to Obtaining Funding in case of Loss of or Damage to a Satellite

UrtheCast determines a satellite's useful life, or its expected operational life, using a complex calculation involving the probabilities of failure of the satellite's components from design or manufacturing defects, environmental stresses, estimated remaining fuel or other causes. The Deimos-1 satellite was launched in 2009 with an expected lifetime of 10 years and the Deimos-2 satellite was launched in 2014 with an expected lifetime of more than seven years.

The expected operational lives of the Deimos-1 and Deimos-2 satellites are affected by a number of factors, including the quality of design and construction, the supply of fuel, the expected gradual environmental degradation of solar panels, the durability of various satellite components and the orbits and space environments in which the Deimos-1 and Deimos-2 satellites are placed and operated. The failure of satellite components could cause damage to or loss of the use of a Satellite before the end of its expected operational life. Electrostatic storms or collisions with other objects could also damage the Deimos-1 or Deimos-2 satellites. UrtheCast cannot provide any assurance that each Satellite will remain in operation until the end of its expected operational life. Furthermore, UrtheCast expects the performance of each Satellite to decline gradually near the end of its expected operational life. UrtheCast can offer no assurance that the Satellites will maintain their prescribed orbits or remain operational.

UrtheCast anticipates using funds generated from cash on hand, operations and funds contributed by UrtheCast's OptiSAR Constellation implementation partners to finance the OptiSAR Constellation. If UrtheCast does not generate sufficient funds from operations or is unable to convert the MOUs with its implementation partners into binding, definitive agreements, it may need to obtain additional financing from outside sources to deploy the OptiSAR Constellation. If UrtheCast does not generate sufficient funds from operations and cannot obtain financing, UrtheCast will not be able to deploy the OptiSAR Constellation or any future satellites, or be able to replace the Deimos-1 and Deimos-2 satellites or any of UrtheCast's future satellites that are commissioned, at the end of their operational lives. UrtheCast cannot provide any assurance that it will be able to generate sufficient funds from operations or raise additional capital on favorable terms or on a timely basis, if at all, to develop or deploy additional medium- or high- resolution satellites.

Risks Related to Limited Insurance Coverage and Availability of Adequate Insurance

UrtheCast currently insures the Deimos-1 and Deimos-2 satellites, and expects to insure future satellites comprising the Constellations, to the extent that insurance remains available at acceptable premiums. It is anticipated that the insurance proceeds received in connection with a partial or total impairment of the functional capacity of any of these current or future satellites may not be sufficient to cover the replacement cost, if UrtheCast chooses to deploy one, of an equivalent satellite. In addition, this insurance will not protect UrtheCast against all losses to its satellites due to specified exclusions, deductibles and material change limitations and it may be difficult to insure against certain risks, including a partial deterioration in satellite performance and satellite re-entry.

Any determination UrtheCast makes as to whether to obtain insurance coverage will depend on a variety of factors, including the availability of insurance in the market, the cost of available insurance and the redundancy of the operating satellites. Insurance market conditions or factors outside UrtheCast's control at the time it is in the market for the required insurance, such as failure of a satellite using similar components, could cause premiums to be significantly higher than current estimates and could reduce amounts of available coverage. Higher premiums on insurance policies will increase UrtheCast's costs and could consequently reduce operating income by the amount of such increased premiums. If the terms of in-orbit insurance policies become less favorable than those currently available, there may be limits on the amount of coverage that UrtheCast can obtain or it may not be able to obtain

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insurance at all. Even if obtained, it is expected that in-orbit operations insurance will not cover any loss in net revenue incurred as a result of a partial or total satellite loss.

Risks Related to Failure to Obtain, or Loss of, Regulatory Approvals

A failure by UrtheCast to obtain or maintain regulatory approvals could result in service interruptions or could impede it from executing its business plan. The EO industry falls within the jurisdiction of the 1986 United Nations resolution "Principles Relating to Remote Sensing of the Earth from Space (1986)", which stipulates that images taken by government and commercial satellites are lawful as long as such images are provided to the countries that have been imaged upon request from such countries.

After significant consultation with lawyers and leading Canadian experts in the field of space law, and after discussions with the Canadian government, the Company has concluded that the Remote Sensing Space Systems Act (Canada) does not apply to its EO business given that the sensors are hosted on the ISS and Deimos Imaging is based and operated entirely in Spain. Notwithstanding the Company's conclusion, there is no certainty that its interpretation of the Remote Sensing Space Systems Act (Canada) is correct. The Company is currently supporting Global Affairs Canada in its review of the Company's EO operations to determine if the Remote Sensing Space Systems Act (Canada) could apply to any portion of UrtheCast's business. While UrtheCast continues to believe this legislation is not applicable, there can be no certainty that a favourable regulatory result will result from this review, and any applicable license could constrain UrtheCast's business, increase compliance costs or adversely affect its expected revenue growth.

Certain aspects of UrtheCast's business plan may be subject to the International Traffic in Arms Regulations in the United States, the Export and Import Permits Act (Canada) or other similar regulatory or legislative regimes in the United States and Canada, and a failure by UrtheCast to obtain or maintain regulatory approvals in connection with such regimes could result in service interruptions or could impede the Company from executing its business plan.

Risks Related to Government Funding

Spanish government grants and subsidies were used, in part, to develop, build and launch the Deimos-2 satellite with its associated ground stations. Among others, these subsidies include: (a) a subsidy from FUNDESCOP – Agencia de Desarrollo de Puertollano, a government agency located in Puertollano, Spain, pertaining to the ability to obtain land formerly owned by the government municipality and used by Deimos Imaging and other divisions of Elecnor, including the land on which the Puertollano antenna in respect of the Deimos-2 satellite is located (the "FUNDESCOP Subsidy"); and (b) a subsidy from Instituto para la Reestructuración de la Minería del Carbón y Desarrollo Alternativo de las Comarcas Mineras, amounting to a €10.65 million non-refundable loan and pertaining to the development of a plant in respect of EO services, including the ability to create small observation satellites (the "MINER Subsidy" and, together with the FUNDESCOP Subsidy, the "Spanish Government Subsidies").

The agreements governing the Spanish Government Subsidies contain various positive and negative covenants pertaining to each beneficiary, as applicable, as well as the use of the assets which are the object of the applicable subsidy. These covenants generally pertain to prescribed amounts of investment, employment levels and the development of land and/or infrastructure, over a certain period of time, as well as restrictions pertaining to changes of control of the applicable beneficiary or the transfer of the object assets. Pursuant to the agreements governing the Spanish Government Subsidies, DCM, a wholly-owned subsidiary of Elecnor, and Deimos Imaging are jointly and severally liable for the fulfillment of the obligations thereunder.

DCM and Deimos Imaging are jointly and severally liable to comply with certain obligations in connection with the FUNDESCOP Subsidy and the MINER Subsidy, pursuant to the terms of the agreements governing such subsidies. Although the Deimos Acquisition Agreement contains certain indemnities from Elecnor in respect of the Spanish Government Subsidies, such indemnities are limited in amount and Deimos Imaging could still be liable for certain amounts in excess of such indemnification limit. Furthermore, the inability of Elecnor to pay any such indemnification amounts could result in Deimos Imaging being required to cover certain liabilities in respect of the Spanish Government Subsidies.

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In addition, as discussed under the heading "General Development of the Business – Three Year History – Government Funding", the Company has received funding grants and other financial support from the Government of Canada to support certain research and development programs. Pursuant to the terms of these funding agreements, the Company is obligated to comply with certain financial covenants and to maintain ownership of certain funded intellectual property, and conduct certain business activities, in Canada. The Company's failure to comply with any of these covenants could result in the termination of these agreements, withdrawal or mandatory repayment of funding, penalty fees and/or the Company being unable to obtain future financial support from the Government of Canada.

Risks Related to Provision of Services by Elecnor Following the Acquisition Closing

In order to ensure compliance with the terms of the Government Subsidies, certain ground segment hardware necessary to communicate with and use the Deimos-2 satellite, including the antenna located in Puertollano, Spain, continues to be owned by DCM following the Acquisition Closing. Consequently, on the Acquisition Closing, DCM, DOT Imaging, Elecnor Deimos Space and Elecnor entered into the Service Level Agreement, pursuant to which DCM and Elecnor Deimos Space are obligated to provide services and premises to Deimos Imaging that are necessary in connection with the use of the Deimos-2 satellite and related operations. Although the Service Level Agreement contains restrictions on the ability of DCM, Elecnor Deimos Space and Elecnor to subcontract the provision of services thereunder or to assign or transfer their obligations thereunder, a failure on the part of DCM, Deimos Space or Elecnor to provide the services required under the Service Level Agreement could have a material adverse effect on UrtheCast.

Risks Related to the Loan and Indebtedness Generally

On December 11, 2015, the Company's wholly-owned Spanish subsidiary, UrtheCast Spain, obtained the Loan of €25 million from Sabadell, a Spanish bank. Pursuant to the Loan agreement and related documents (together, the "Loan Agreement"), the Loan has a five-year term and will accrue interest at the 6-month Euro Interbank Offered Rate (EURIBOR), which shall be deemed to be no less than 0%, plus 2.6% per annum. See "General Development of the Business – Three Year History – Financings". Furthermore, the Company has certain low-interest loans with government agencies.

The Loan Agreement has usual and customary covenants to keep the facility in good standing, including, but not limited to, repayment of the principal advanced thereunder and accrued interest, receipt of regular financial reports, compliance with all applicable laws and applicable securities legislation, obligation to provide notice of material events, compliance with the use of proceeds provisions of the Loan, and obligation to maintain secured assets and insurance thereon. If UrtheCast defaults in respect of its obligations under the Loan Agreement, then there is a risk that UrtheCast could lose the shares of certain of its international subsidiaries (which are secured under the Loan), and any other property securing its obligations under such Loan Agreement and UrtheCast's shareholders could lose their entire investment. The Deimos-1 and Deimos-2 satellites are not secured under the Loan.

The Company's level of indebtedness and the terms thereof will have several important effects on its future operations, including, without limitation, that it:

• will require the Company to dedicate a portion of its cash flow from operations, if any, to the payment of principal and interest on the Company's outstanding indebtedness, thereby reducing the funds available to it for operations and any future business opportunities; • could increase the Company's vulnerability to adverse changes in general economic and industry conditions, as well as to competitive pressure; and • depending on the levels of its outstanding debt, could limit the Company's ability to obtain additional financing for working capital, capital expenditures, general corporate and other purposes. The Company's ability to make payments of principal and interest on its indebtedness depends upon the Company's expected future revenues, will be subject to prevailing economic conditions, changes in the EURIBOR rate, industry cycles and financial, business and other factors affecting its operations, many of which are beyond the Company's control. If the Company's revenues are insufficient to, or the Company cannot raise sufficient funds to, meet its debt service and other obligations in the future, the Company may be required, among other things, to:

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• obtain additional financing in the debt or equity markets; • refinance or restructure all or a portion of its indebtedness; and/or • sell selected assets. The Company cannot provide assurance that such measures will be sufficient to enable the Company to service its debt. In addition, any such financing, refinancing or sale of assets might not be available on economically favorable terms or at all. If the Company does not generate sufficient cash flow from operation, and additional financings, borrowings or refinancings, or proceeds of asset sales are not available to it, the Company may not have sufficient cash to enable it to meet its obligations, including payments under the Loan Agreement.

Risks Related to Security Measures

Any breach of the Company's system security measures could result in interruption, delay or suspension of the Company's ability to provide its proposed products and services, and could result in loss of current and future business, including its contracts with PanGeo Alliance members, EO customers, GEOSYS, its confidential customer in respect of the first two satellites sold from the OptiSAR Constellation, data distributors or other customers of UrtheCast's Engineering Services Division. The Company's business involves the transmission and storage of large quantities of electronic data. In addition, the Company delivers content over the Internet. The Company's systems may be targeted by computer viruses and other forms of third party attacks on its systems and any such attack could materially adversely affect its business.

Despite the implementation and continued upgrading of security measures, the Company's network infrastructure may be vulnerable to computer viruses, unauthorized third party access or other problems caused by third parties, which could lead to interruptions, delays or suspension of its operations, loss of imagery data access, as well as the loss or compromise of technical information or customer information. Inappropriate use of the Internet by third parties, including attempting to gain unauthorized access to information or systems – commonly known as "cracking" or "hacking" – could also potentially jeopardize the overall security of the Company's systems and could deter certain expected customers from doing business with the Company. In addition, a security breach that involved sensitive government information or certain controlled technical information, could subject UrtheCast to civil or criminal penalties and could result in loss of certain security clearances and other accreditations, loss of government contracts, loss of access to information, loss of export privileges or debarment as a government contractor.

Because the techniques used to obtain unauthorized access, or to otherwise infect or sabotage systems change frequently and often are not recognized until launched against a target, the Company may be unable to anticipate these techniques or to implement adequate preventative measures. The Company may also need to expend significant resources to protect against security breaches. The risk that these types of events could seriously harm the Company's business is likely to increase as it expands the number of web-based products and services it offers as well as increase the number of countries within which it does business.

Risks Related to Intellectual Property

The Company relies on a combination of patent laws, trademark laws, trade secrets, confidentiality procedures, licenses and contractual provisions to protect its proprietary rights. Despite the Company's best efforts, unauthorized parties may attempt to copy aspects of its imagery or data or to obtain information the Company regards as proprietary. Policing unauthorized use of the Company's proprietary technology, if required, may be difficult, time- consuming and costly. In addition, the laws of certain countries in which the Company's products are sold or licensed do not protect its products and related intellectual property rights to the same extent as the laws of Canada. As such, the Company's strategies to deter misappropriation could be inadequate. If the Company is unable to protect its intellectual property against unauthorized use by others, it could have an adverse effect on the Company's competitive position. In addition, the Company could be required to spend significant funds and its managerial resources could be diverted in order to defend its rights, which could disrupt its operations.

Failure to protect UrtheCast's existing and future intellectual property rights could seriously harm UrtheCast's business and prospects and may result in the loss of UrtheCast's ability to exclude others from practicing UrtheCast's technology or UrtheCast's own right to practice its technologies. If UrtheCast does not adequately ensure its freedom

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to use certain technology, it may have to pay others for rights to use their intellectual property, pay damages for infringement or misappropriation and/or be enjoined from using such intellectual property. UrtheCast's patent applications do not guarantee UrtheCast the right to practice UrtheCast's technologies if other parties own intellectual property rights that UrtheCast needs in order to practice such technologies. UrtheCast's patent position is subject to complex factual and legal issues that may give rise to uncertainty as to the validity, scope and enforceability of a particular patent or family of patents. As is the case in many other industries, the web of intellectual property ownership in UrtheCast's industry is complicated and, in some cases, it is difficult to define with precision where one property begins and another ends. In some cases, the Company jointly owns intellectual property with other third parties, which creates additional challenges in patent prosecution and enforcement. In any case, there can be no assurance that:

• any of the rights UrtheCast is pursuing through patent applications or other patents that third parties license to UrtheCast will not be curtailed, for example, through invalidation, inconsistent prosecution, circumvention, challenge, changes in law, being rendered unenforceable or by license to others; • UrtheCast was the first inventors of inventions covered by pending applications or that UrtheCast was the first to file patent applications for such inventions; • any of UrtheCast's pending or future patent applications will be issued with the breadth of claim coverage sought by UrtheCast, or be issued at all; • any of UrtheCast's pending or future patent applications where the intellectual property is jointly owned with one or more third parties will not be adversely impacted by inconsistent patent prosecution, or be issued at all; • any of UrtheCast's pending or future patent applications where the intellectual property is jointly owned with one or more third parties can be successfully prosecuted should a dispute with one or more of the joint holders arise; • any of UrtheCast's pending or future patent applications where the intellectual property is jointly owned can be enforced; • UrtheCast's competitors will not independently develop or patent technologies that are substantially equivalent or superior to UrtheCast's technologies; • any of UrtheCast's trade secrets will not be learned or developed independently by UrtheCast's competitors; or • the steps UrtheCast takes to protect its intellectual property will be adequate. In addition, effective patent, trademark, copyright and trade secret protection may be unavailable, limited or not applied for in certain foreign countries in respect of intellectual property solely owned by the Company. Effective patent, trademark, copyright and trade secret protection may be further complicated, unavailable, limited or not applied for in certain foreign countries as a result of it being jointly held by the Company and third parties.

UrtheCast seeks to protect its proprietary intellectual property, including intellectual property that may not be patented or patentable, in part by confidentiality agreements and, if applicable, inventors' rights agreements with its strategic partners and employees. There can be no assurance that these agreements will not be breached, that UrtheCast will have adequate remedies for any breach or that such persons or institutions will not assert rights to intellectual property arising out of these relationships. Certain intellectual property has been licensed to UrtheCast from third parties who may also license such intellectual property to others, including UrtheCast's competitors. If necessary or desirable, UrtheCast may seek further licenses under the patents or other intellectual property rights of others. However, UrtheCast can give no assurances that UrtheCast will obtain such licenses or that the terms of any offered licenses will be acceptable to UrtheCast. The failure to obtain or renew a license from a third party for intellectual property UrtheCast uses at present could cause it to incur substantial costs and to suspend its use of processes requiring such intellectual property.

The Company may also be challenged by allegations of infringement of the intellectual property of others. There is no assurance the Company will be successful in defending such claims, and if it is unsuccessful there is no

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assurance that the Company will be successful in obtaining a license for the intellectual property in question or developing a work around. While UrtheCast is not currently engaged in any intellectual property litigation, UrtheCast could become subject to lawsuits in which it is alleged that it has infringed the intellectual property rights of others or in which the scope, validity and enforceability of UrtheCast's intellectual property rights is challenged. In addition, UrtheCast may commence lawsuits against others who it believes are infringing upon its rights. UrtheCast's involvement in intellectual property litigation or disputes, could be time consuming and result in significant expense to UrtheCast, diversion of resources, and delays or stoppages in the development, production and sales of products or intellectual property, whether or not any claims have merit or such litigation or disputes are resolved in its favour. In the event of an adverse outcome as a defendant in any such litigation, UrtheCast may, among other things, be required to:

• pay substantial damages; • cease the development, manufacture, use, sale or importation of products that infringe upon other patented intellectual property; • expend significant resources to develop or acquire non-infringing intellectual property; • discontinue processes incorporating infringing technology; • develop new non-infringing processes; or • obtain licenses to the infringing intellectual property. Any such result could require the expenditure of substantial time and other resources and could have a material adverse effect on UrtheCast's business and financial results.

Risks Related to Infrastructure

The availability of the Company's products and services will depend on the operation of its satellite operations infrastructure, information technology, communications systems and similar third party technologies and systems. Any downtime, damage to or failure of the Company's systems or those third-party systems that it relies on could result in interruptions in service, which could reduce the Company's revenues and future profits. The Company's systems or those third-party systems that it relies on are vulnerable to damage or interruption from floods, fires, power loss, telecommunications failures, computer viruses, computer denial of service attacks or other attempts to harm the Company's systems. In the event that the Company is unable to collect, process and deliver imagery from its processing facilities, its daily operations and anticipated operating results would be materially and adversely affected. In addition, the ground stations used for downloading data are vulnerable to damage or interruption from human error, intentional bad acts, earthquakes, hurricanes, floods, fires, war, terrorist attacks, power losses, hardware failures, systems failures, telecommunications failures and similar events. The occurrence of any of the foregoing could result in lengthy interruptions in the Company's services and/or damage its reputation, which could have a material adverse effect on the Company's financial condition and results of operations.

Risks Related to Failure to Protect EO Data

The Company's operations depend upon its ability to maintain and protect its EO imagery against damage that may be caused by fire and other natural disasters, power failures, telecommunications failures, terrorist attacks, unauthorized intrusion, computer viruses, equipment malfunction or inadequacy, firewall breach or other events. The EO imagery content that the Company collects is downloaded directly to its facilities, or to ground stations operated by third parties and then transmitted to the Company's facilities, and then stored for sale to customers. Notwithstanding precautions that the Company takes to protect its content, there can be no assurance that a natural disaster or other event would not result in a prolonged interruption in its ability to provide access to, or deliver imagery to, its clients. The temporary or permanent loss or disruption of access to its content could impair the Company's ability to supply current and future customers with images and video, have a negative impact on its anticipated revenue and cause harm to its reputation. Any impairment in the Company's ability to supply its customers with imagery content could affect its ability to retain or attract customers, which would have a material adverse effect on its business, financial condition and results of operations.

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Risks Related to Failure to Gain Market Acceptance

The market may not accept certain of the Company's proposed products and services, including but not limited to those expected to be generated by the OptiSAR Constellation and the UrtheDaily Constellation or other geo-information and geoanalytics products and services that the Company is seeking to create and market. Readers should not rely upon the Company's MOUs or other agreements as an indicator of future revenue growth. There can be no assurance that the Company will enter into definitive agreements with these parties or, if entered into, that such agreements will generate revenues or be profitable for the Company. The Company's success depends, in part, on existing new markets accepting its current and proposed products and services and its ability to develop new markets. The Company's business plan is based on the assumption that it will generate significant future revenue from sales of image products and value-added services produced and geoanalytics products. The commercial sale of high-resolution EO imagery, geo-information and geonalytics products, the use of ‘big-data’ analytics for EO imagery, the application of machine-learning algorithms and technologies to EO imagery analysis, and related products and services are relatively new, and rapidly-changing industries, and sales of such products and services to non-governmental customers is a relatively new market segment. Consequently, it is difficult to predict the ultimate size, demands and preferences of these markets, and the ultimate likelihood of acceptance by these markets of the Company's current and proposed products and services, such as the products and features made possible by machine learning-ready data or other geoanalytics solutions that are expected to be produced by the OptiSAR Constellation and the UrtheDaily Constellation. Expectations regarding future market size by third party research firms, such as Euroconsult and MarketsandMarkets, are based upon various assumptions and may not be realized. The Company's business strategy and projections rely on a number of assumptions, some or all of which may be incorrect. Actual markets could vary materially from the potential markets that UrtheCast has identified.

The Company cannot accurately predict whether its proposed products and services will achieve significant market acceptance (if any) or whether there will be a market for such products and services on terms it deems acceptable. Market acceptance of UrtheCast's commercial EO imagery, geo-information and geonalytics products, and related value-added products and services depends on a number of factors, including the quality, scope, timeliness, sophistication, price and the availability of substitute products and services. Lack of significant market acceptance of UrtheCast's offerings, or other products and services that utilize its products and services, delays in acceptance, failure of certain markets to develop or the need to make significant investments to achieve acceptance by the market would negatively affect the Company's business, financial condition and results of operations.

If the Company is unable to achieve sustained growth, it may be unable to execute its business strategy, expand its business or fund other liquidity needs and its prospects, financial condition and results of operations could be materially and adversely affected.

Risks Related to Changes in Technology

The market in which the Company will operate is characterized by changing technology and evolving industry standards. The Company's systems embody complex technology and may not always be compatible with current and evolving technical standards and systems developed by others. Failure or delays by the Company to meet or comply with the requisite and evolving industry or user standards could have a material adverse effect on the Company's proposed business, results of operations and financial condition. The Company's ability to anticipate changes in technology, technical standards and the needs of the industries it serves or proposes to serve will be a significant factor in its ability to compete or expand. There can be no assurance that the Company will be successful in identifying, developing and marketing products or systems that respond to rapid technological change, evolving standards or individual customer standards or requirements.

Risks Related to Competition and Loss of Market Share

UrtheCast's products and services compete with satellite and aerial imagery and related products and services offered by a range of private and government providers. The Company's current or future competitors may have greater financial, personnel and other resources than the Company does. The Company's major existing competitors include Digital Globe, Inc., Airbus Defence and Space, MacDonald Dettwiler & Associates Ltd., Planet, Inc., and foreign governments including India, South Korea, Taiwan and others that sell their data commercially, as well as numerous aggregators of imagery and imagery-related products and services, including Google and Microsoft. In addition, the

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Company competes against aerial providers of high-resolution imagery, whose offerings provide certain benefits over satellite-based imagery, including better resolution and accuracy. The value of UrtheCast's proposed imagery may also be diluted by Earth imagery that is available free of charge.

The Russian, U.S. or other governments also may develop, construct, launch and operate their own cameras, which could reduce their need to rely on commercial suppliers. In addition, such governments could sell or provide Earth imagery free of charge from their satellites in the commercial market and thereby compete with the Company's proposed imagery products and services. These governments could also subsidize the development, launch and operation of imagery satellites by the Company's current or future competitors.

As non-exhaustive examples, in December 2011, Airbus Defence and Space successfully launched its high- resolution satellite, Pleiades-1a, which began commercial operations in the first half of 2012. Its twin satellite, Pleiades-1b was launched in December 2012 and commenced commercial operation in early 2013. In addition, India successfully launched the SPOT 6 and SPOT 7 satellites in 2012 and 2014 respectively, for Airbus Defence and Space, and in 2015 launched the TripleSat Constellation, developed by SSTL and licensed to the Chinese company 21AT. In early 2017, Digital Global, Inc. began commercial operations with its high-resolution WorldView-4 satellite, while ESA launched its Sentinel-2B spacecraft in 2016 to join its Sentinel-1B spacecraft, launched in 2015. In February 2017, the Indian Space Research Organization launched 104 satellites, including the Cartosat-2 EO satellite and 88 of Planet, Inc.'s nano EO satellites, known as "Doves". Additional satellites from Chinese government and commercial providers, as well as other states, are being launched and could enter the international commercial imagery market in the near-future. All these satellites compete in whole or in part with the products provided by the Company.

The Company's competitors or potential competitors with greater resources could, in the future, offer satellite-based imagery or other products and services with more attractive features than the Company's products and services. The emergence of new remote imaging technologies or the continued growth of low-cost imaging satellites, could negatively affect the Company's marketing efforts. More importantly, if competitors develop and launch satellites or other imagery content sources with more advanced capabilities and technologies than the Company possesses, or offer services at lower prices than the Company does, the Company's business and results of operations could be materially adversely affected. If the Company is unable to offset any necessary decreases in average selling prices by increasing sales volumes or by adjusting its product mix, the Company's revenues and operating margins may decline and its financial position may be harmed.

In addition, the proposed merger of Digital Globe, Inc. and MacDonald Dettwiler & Associates Ltd., as well as the recently announced acquisition of Terra Bella by Planet, Inc., have increased consolidation in the EO industry and are expected to concentrate significant market share, thereby creating a competitive risk to UrtheCast as a small, less capitalized and less well-established entrant in this market.

Risks Related to Lack of Revenue and Additional Funds

The Company can give no assurance that its strategies to further commercialize its imagery offerings can or will be successful, or that it will be able to achieve profitability. In addition, the Company cannot guarantee that it will be able to generate additional revenue in the future. If the Company is unable to further commercialize its products and achieve profitability, it could face cash-flow shortfalls and may need to engage in debt financing or further rounds of equity financing. Any future equity financing would result in equity dilution for UrtheCast's shareholders. In addition, although the Company has been successful in raising funds in the past, there can be no assurance that it will be able to raise sufficient funds in the future on reasonable terms acceptable to the Company. Any failure to raise necessary funds could have a material adverse effect on the Company's growth prospects and financial condition.

Risks Related to Dependence on Foreign Data Distributors

The Company relies, in part, on foreign regional distributors and partners to market and distribute its imagery content in the international market. The Company's foreign distributors and partners may not have the skill or experience to develop regional commercial markets for its imagery products and services, or may have competing interests that negatively affect their sales of the Company's products and services. If the Company's foreign resellers and partners fail to market and sell the Company's imagery products and services successfully, these failures could negatively impact the Company's business, financial condition and results of operations.

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Risks Related to Changes in Laws and Regulations and Political Developments

Changes in Canadian, American, Russian, Spanish, Maltese, European Union or other foreign laws and regulations could have a material adverse effect on the Company's operations and financial condition. UrtheCast's industry is highly regulated due to the sensitive nature of satellite technology. While the Company endeavors to comply with all laws and regulations in force at any given time, it cannot give assurance that the laws and regulations governing its business and operations, including the distribution of satellite imagery, will not change in the future, or of its future compliance with changes in these laws and regulations. The Company's business and operating results may be materially and adversely affected if it is required to alter its business operations to comply with such changes or if its ability to sell its products and services on a global basis is reduced or restricted due to increased government regulation.

Risks Related to Operating in Foreign Jurisdictions and Political Developments and Uncertainty in the Russian Federation

The Company's international business exposes it to risks relating to increased regulation and political or economic instability in foreign markets, which could adversely affect its revenues. In particular, international operations and relationships with foreign parties or governments are subject to the following risks:

• changes in domestic and foreign governmental regulations and licensing requirements; • deterioration of relations between Canada and a particular foreign country; • deterioration of relations between the United States or the member states of the European Union and a particular foreign country; • deterioration of relations between Spain and a particular foreign country; • increases in tariffs and taxes and other trade barriers; • changes in political and economic stability, including fluctuations in the value of foreign currencies, which may make payment in Canadian dollars, United States dollars or Euro, as provided for under some of the Company's existing contracts, more expensive for foreign customers; • effects of austerity programs or similar significant budget reduction programs; and • difficulties in obtaining or enforcing judgments in foreign jurisdictions. These risks are beyond the Company's control and could have a material and adverse effect on its business. For example, the Company's ability to obtain business travel visas to certain regions may become restricted.

Ongoing political tensions and uncertainties as a result of the Russian Federation's foreign policy decisions and actions in respect of Ukraine and other jurisdictions have resulted in the imposition of economic sanctions and have increased the risk that certain governments may impose further economic or other sanctions or penalties on, or may take other actions against, the Russian Federation or on persons and/or companies conducting business in the Russian Federation or may otherwise act in support of Ukraine. There can be no assurance that sanctions or other penalties will not be imposed, or other actions will not be taken, by the Russian Federation, including in response to existing or threatened sanctions or other penalties or actions by Canada, the United States or the European Union and/or other governments against the Russian Federation or persons and/or companies conducting business in the Russian Federation. The imposition of such economic sanctions or other penalties, or such other actions by the Russian Federation and/or other governments, could have a material adverse effect on the Company's assets and operations.

In addition, as discussed under the heading "General Development of the Business – Three Year History – ISS Cameras", Energia terminated its commercial arrangement with UrtheCast in respect of the ISS Cameras effective December 31, 2016. Any prospective sale, licensing or other means of monetizing the ISS Cameras will require the cooperation of Energia and Roscosmos. As a result, any further change or degradation in UrtheCast’s commercial relationship with these entities could impact the timing or success of such sale, license or other monetization, which in turn could have a material adverse effect on the Company's assets and operations.

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Risks Related to Global Economic Conditions

Disruption and volatility in global financial markets may lead to increased rates of default and bankruptcy and may negatively impact consumer-spending levels. These macroeconomic developments could adversely affect UrtheCast's business, operating results or financial condition, as well as its ability to obtain any necessary future financing on reasonable terms. Current or potential customers, including foreign governments, may delay or decrease spending on UrtheCast's products and services as their business and/or budgets are impacted by economic conditions. The inability of customers to pay for UrtheCast's products and services may adversely affect the Company's anticipated future earnings and cash flows.

Risks Related to the Prior Business of Longford

Prior to the Formation Transaction, Longford was an independent international oil and gas company focused on the exploration and development of an oil and gas exploration project known as the Chia Surkh Block (the "Block") in the Kurdistan region of Iraq. On January 16, 2012, Longford entered into an agreement to sell the Block to Genel Energy Plc, and this sale was completed on April 30, 2012 (the "Block Sale"). Completion of the Formation Transaction resulted in a combination of the business activities carried on by each of Longford and EVC as separate entities at the time of closing of the Formation Transaction. While Longford had minimal operations since April 30, 2012, when it announced the Block Sale, the combination of those activities into UrtheCast may expose shareholders and creditors to different business risks than those to which they were exposed to prior to completion of the Formation Transaction. There can be no assurance that Longford's prior operations, conduct and pre-existing liabilities, including in connection with its exploration and operational activities at the Block, the Block Sale and the various agreements that Longford was party to related to the Block, as well as other oil and gas exploration operations undertaken by Longford's subsidiaries prior to the Formation Transaction, will not lead to legal or regulatory proceedings against the Company or one or more of its subsidiaries. Any legal or regulatory proceedings, should they materialize, could have a material adverse effect on the Company's financial position and results of operations.

All historical information regarding Longford contained or incorporated by reference in this AIF was provided by Longford in connection with the Formation Transaction. Although UrtheCast has no reason to doubt the accuracy or completeness of such information, any inaccuracy or material omission in the information about or relating to Longford contained in this AIF or the documents incorporated by reference herein could result in unanticipated liabilities or expenses, increase the cost of integrating the companies or adversely affect the operational plans of UrtheCast and its results of operations and financial condition.

Risks Related to Third Party Credit Risk

The Company is or may be exposed to third party credit risk through its contractual arrangements with its current or future data customers and other parties. In the event such entities fail to meet their contractual obligations, such failures could have a material adverse effect on the Company and its expected cash flow from future operations.

Risks Related to Currency Exchange Rate Risk

The Company's results are reported in Canadian dollars. UrtheCast currently actively operates in Canada, Spain, and the United States, and distributes its image and video content in various jurisdictions around the world. As a result, significant portions of the Company's costs and proposed revenue streams are expected to be denominated in foreign currencies, including the U.S. dollar and Euro. To the extent that there are fluctuations in the Canadian dollar relative to other currencies, the Company's revenue and operating results may be negatively impacted.

Risks Related to Liquidity of Common Shares

There may not be an active, liquid market for the Common Shares. There is no guarantee that an active trading market for the Common Shares will be maintained on the TSX. Investors may not be able to sell their Common Shares quickly or at the latest market price if trading in the Common Shares is not active.

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Risks Related to Market Price Volatility of Common Shares

There can be no assurance that an active market for the Common Shares will be sustained. The market price of the Common Shares may be adversely affected by a variety of factors relating to UrtheCast's business, including fluctuations in the Company's operating and financial results, the results of any public announcements made by the Company or changes in the EO market. In addition, the market price and trading volume of securities of technology companies have experienced substantial volatility in the past, sometimes based on factors unrelated to the financial performance or prospects of the companies involved. These factors include general fluctuations in the stock market, changes in global financial markets, general market conditions, macroeconomic developments globally and market perceptions of the attractiveness of the technology industry. As a result of any of these factors, the market price of the securities of the Company at any given point may not reflect the long-term value of the Company. The stock markets in general have recently experienced extreme volatility. This volatility may adversely affect the market price of the Common Shares.

Risks Related to Potential Dilution of Common Shares

UrtheCast has an unlimited number of Common Shares that may be issued, subject to securities laws, without further action or approval of UrtheCast's shareholders. While the Company's Board is required to fulfill its fiduciary obligations in connection with the issuance of the Common Shares, Common Shares may be issued in transactions with which not all shareholders agree, and the issuance of such shares will cause dilution to the ownership interests of UrtheCast's shareholders. Additional financing may be needed to continue funding the Company's development and operation of its business and may require the issuance of additional securities of the Company. UrtheCast cannot predict the size of future issuances of securities or the effect, if any, that future issuances and sales of securities will have on the market price of the Common Shares. Sales or issuances of substantial numbers of Common Shares, or the perception that such sales could occur, may adversely affect prevailing market prices of the Common Shares.

Risks Related to Dividends

The Company has never declared or paid any cash dividends on its Common Shares and does not anticipate paying cash dividends on its Common Shares in the near term. In the near term, the Company anticipates that it will retain all of its future earnings, if any, for use in the development and expansion of its business and for general corporate purposes. Any determination to pay dividends on the Common Shares in the future will be at the discretion of the Board.

Risks Related to Privacy and Consumer Protection Laws

The Company is and will be subject to numerous Canadian and foreign laws and regulations relating to privacy and consumer protection issues. New laws and regulations (or new interpretations of existing laws and regulations) may increase costs and could negatively impact the Company's anticipated business and results of operations in material ways. The costs of compliance with these laws and regulations may be significant and are likely to increase in the future. Any failure on the Company's part to comply with these laws and regulations can result in negative publicity and diversion of management time and effort and may subject the Company to significant liabilities and other penalties.

Risks Related to UrtheCast's Directors, Officers and Employees

Certain of UrtheCast's directors and officers are also directors and/or officers and/or shareholders of other technology companies. Such associations may give rise to conflicts of interest from time to time. The directors of UrtheCast are required by law to act honestly and in good faith with a view to uphold the best interests of UrtheCast and to disclose any interest that they may have in any project or opportunity of UrtheCast. If a conflict of interest arises at a meeting of the Board of UrtheCast, any director in a conflict must disclose his interest and abstain from voting on such matter. In determining whether or not the Company will participate in any project or opportunity, the directors will primarily consider the degree of risk to which UrtheCast may be exposed and its financial position at the time.

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In addition, because of the specialized nature of UrtheCast's business, it relies heavily on its ability to attract and retain qualified scientific, technical, sales, marketing and managerial personnel. There is little possibility that this dependence will decrease in the near term. The loss of one or more of the Company's senior management personnel could result in the loss of knowledge, experience and technical expertise within the satellite imagery sector, which would be detrimental to the Company if it cannot recruit suitable replacements in a timely manner. The competition for qualified personnel in the commercial high-resolution EO, SAR, satellite design and software design industries is intense. Due to this intense competition, the Company may be unable to continue to attract and retain the qualified personnel necessary for the development of its business or to recruit suitable replacement personnel. In addition, as the Company's operations expand, additional general management resources will be required. The loss of the services of any member of the Company's senior management or the inability to hire or retain experienced management personnel could adversely affect the Company's ability to execute its business plan and harm its operating results. The Company does not maintain "key man" insurance on any members of its management or directors.

DIVIDENDS

The Company has not paid dividends to its shareholders to date and does not anticipate paying cash dividends on the Common Shares in the foreseeable future. The Company's current policy is to retain cash flows to finance the development and enhancement of its cameras and to otherwise reinvest in the Company's business. The declaration and payment of dividends on the Common Shares is at the discretion of the Board of Directors. The Company's dividend policy will be reviewed from time to time by the Board of Directors in the context of earnings, financial condition and other relevant factors.

DESCRIPTION OF CAPITAL STRUCTURE

Common Shares

The Company is authorized to issue an unlimited number of Common Shares. The holders of the Common Shares are entitled to one vote per share at meetings of shareholders, to receive dividends if, as and when declared by the Board (subject to the rights of securities, if any, having priority over the Common Shares) and to receive pro rata the remaining property and assets of the Company upon its dissolution or winding-up (subject to the rights of securities, if any, having priority over the Common Shares).

As of the date of this AIF, there were 118,807,500 Common Shares issued and outstanding. The Common Shares are listed on the TSX under the symbol "UR".

Warrants

As of the date of this AIF, there were 124,842 warrants for the purchase of Common Shares ("Warrants") outstanding with a weighted average exercise price of $1.77. The Warrants expire on June 21, 2018.

The certificates representing the Warrants include customary adjustment provisions relating to the number of securities issuable and the exercise price per security in the event of material transactions or capital reorganization events that would affect the Common Shares (such as a subdivision or consolidation of the Common Shares, the issuance of other securities convertible into Common Shares or payment of an in-kind dividend or distribution) or would be a fundamental change to UrtheCast (including a reclassification of Common Shares or completion of a material corporate transaction).

Options

As of the date of this AIF, there were 6,377,167 options to purchase Common Shares ("Options") outstanding with a weighted average exercise price of $1.30 and expiry dates ranging from January 31, 2017 to November 21, 2021. The Options with an expiry date on January 31, 2017 will remain exercisable until the tenth business day following the end of the Company’s current ordinary course blackout period imposed pursuant to the Company's Insider Trading Policy.

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The Options are governed by the Equity Incentive Plan of the Company dated June 13, 2013, as amended on May 12, 2014 (the "Equity Incentive Plan") and each vested Option is exercisable for one Common Share upon the payment of the exercise price. At the time of the Formation Transaction, each outstanding stock option of EVC was exchanged for one Option (the "Replacement Options"). The Replacement Options are subject to the same vesting conditions, exercise prices and expiry dates as the stock options of EVC that they replaced, except that such Replacement Options are exercisable for the common shares of UrtheCast instead of common shares of EVC. A copy of the Equity Incentive Plan is available for review at www.urthecast.com.

Share Units

Pursuant to the Equity Incentive Plan, the Board is authorized to issue Share Units to eligible persons (as defined therein). Each Share Unit entitles the holder to one Common Share upon vesting. As of the date of this AIF, there are 2,399,998 Share Units outstanding. Of these Share Units, all vest in 25% increments on each of the 6, 12, 18 and 24 month anniversaries of the date of their grant, except 531,248 Share Units granted to directors of the Company, which vest immediately upon grant and will be converted to Common Shares upon such directors ceasing to be directors of the Company.

MARKET FOR SECURITIES

Trading Price and Volume

The Common Shares are listed on the TSX under the trading symbol "UR". The following table sets forth the reported monthly high and low trading prices and trading volume of the Common Shares on the TSX for the most recently completed financial year:

Month Monthly Low Price ($) Monthly High Price ($) Monthly Volume January 2016 0.99 1.6 6,391,682 February 2016 1.14 1.62 8,493,693 March 2016 1.01 1.47 8,577,333 April 2016 0.95 1.24 6,722,504 May 2016 0.98 1.25 5,988,118 June 2016 0.90 1.24 4,463,495 July 2016 0.86 1.06 3,383,556 August 2016 0.91 1.24 5,494,571 September 2016 0.89 1.08 3,760,528 October 2016 0.96 1.15 3,559,638 November 2016 0.69 0.97 7,258,235 December 2016 0.75 0.99 6,091,468

Prior Sales

Common Shares

The following table summarizes the issuances of Common Shares by UrtheCast during the most recently completed financial year:

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Exercise Number of Date of Grant Security Price Securities Issuance Price January 1, 2016 – June 30, 2016(1) Common Shares N/A 1,523,110 N/A January 1, 2016 – June 30, 2016(2) Common Shares N/A 30,000 $0.75(3) July 1, 2016 – December 31, 2016(1) Common Shares N/A 373,750 N/A

Notes: (1) Issued pursuant to vested Restricted Share Units ("RSUs"). (2) Issued pursuant to exercise of options. (3) Weighted average exercise price of the options.

Options

The following table summarizes grants of Options by UrtheCast during the most recently completed financial year:

Date of Grant Security Exercise Price Number of Securities Expiry April 6, 2016(1) Options $1.17 57,000 April 5, 2021 June 28, 2016(1) Options $0.97 870,000 June 27, 2021 November 22, 2016(1) Options $0.87 245,000 November 21, 2021

Note: 1 (1) These Options are granted pursuant to the Equity Incentive Plan. Subject to the terms of the Equity Incentive Plan, the Options vest in /3 increments on each 12-month anniversary of the grant date. Restricted Share Units

The following table summarizes the grants of Share Units by UrtheCast during the most recently completed financial year:

Number of Date of Grant Security Exercise Price Securities Expiry April 6, 2016(1) RSUs N/A 30,000 N/A(2) April 6, 2016(1) RSUs N/A 256,415 N/A(3) June 28, 2016(1) RSUs N/A 2,130,000 N/A(2) November 22, 2016 (1) RSUs N/A 10,000 N/A(2)

Notes: (1) These RSUs are granted pursuant to the Equity Incentive Plan. 1 (2) Vest in /4 increments on each of the six, 12, 18 and 24 month anniversaries of date of grant. Payout occurs on vesting or as soon as possible thereafter. (3) Vested immediately. Payout occurs on termination date.

Warrants

The Company did not issue any warrants during the financial year ended December 31, 2016.

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ESCROWED SECURITIES AND SECURITIES SUBJECT TO CONTRACTUAL RESTRICTION ON TRANSFER

As of December 31, 2016, to the Company's knowledge, none of the Company's securities were in escrow or subject to a contractual restriction on transfer.

DIRECTORS AND OFFICERS

The following table sets forth the name, location of residence and office held by each of UrtheCast's executive officers and directors as of the date of this AIF. Each director is elected at the annual meeting of shareholders or appointed pursuant to the provisions of UrtheCast's by-laws and applicable law to serve until the next annual meeting or until a successor is elected or appointed, subject to earlier resignation by the director. Unless otherwise noted, all directors listed below were appointed to the UrtheCast board of directors concurrent with the Formation Transaction to fill the vacancies created by the resignation of the former directors and officers of Longford.

Name, Office Held and Province Principal Occupation and Country of Residence for Preceding Five Years TYE W. BURT (1)(5) Corporate Director, Chair and Principal of Carbon Arc Investments Chairman and Director Inc., President, CEO and director of Kinross Gold Corporation Ontario, Canada WILLIAM (MAC) EVANS (1)(3)(4)(8) Corporate Director, Chair of the Defence Advisory Board Director Ontario, Canada GREG NORDAL (1)(2)(3)(4)(7) President and CEO of Nelson Education Director Ontario, Canada LETITIA A LONG (1)(2)(4) Corporate Director, Director of the National Geospatial-Intelligence Director Agency Virginia, USA (1)(2)(3)(6) JAMES TOPHAM Corporate Director Director British Columbia, Canada WADE LARSON Director, President and CEO of UrtheCast (previously President and Director, President, Chief Executive COO), Executive VP of EVC, -VP at MacDonald Dettwiler & Officer and Chief Operating Officer Associates Ltd. British Columbia, Canada ISSA NAKHLEH(9) CFO of UrtheCast, CFO of EVC, CFO of Heart Force Medical Inc. Chief Financial Officer British Columbia, Canada SAI W. CHU (9) CFO of VesselCos and Seaspan Crew Management Ltd., CFO of Chief Financial Officer Seaspan Management Services Limited, Manager of Seaspan British Columbia, Canada Corporation, CFO and Principal Accounting Officer of Seaspan Corporation GEORGE TYC CTO of EVC, Technical Director at MDA Chief Technology Officer British Columbia, Canada CHRIS HOESCHEN SVP, Legal at UrtheCast, Director of Legal Affairs at MDA Executive VP, General Counsel and Corporate Secretary British Columbia, Canada

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Name, Office Held and Province Principal Occupation and Country of Residence for Preceding Five Years JEFF RATH VP at EVC, Managing Director of Canaccord Genuity Corp. Executive VP, Corporate Finance and Strategy Massachusetts, USA PETER DUGGAN VP, Programs at UrtheCast, Program Director at MDA Executive VP, Operations British Columbia, Canada

Notes: (1) Member of the Corporate Governance and Nominating Committee (2) Member of the Audit Committee (3) Member of the Compensation Committee (4) Member of the Technical and Operations Committee (5) Chairman of the Corporate Governance and Nominating Committee (6) Chairman of the Audit Committee (7) Chairman of the Compensation Committee (8) Chairman of the Technical and Operations Committee (9) Mr. Sai W. Chu was appointed Chief Financial Officer effective March 29, 2017. Mr. Issa Nakhleh resigned as Chief Financial Officer as of the same date.

Information about each of UrtheCast's current – and in the case of Mr. Sai Chu, future – directors and executive officers, including his/her respective principal occupation during at least the five years preceding December 31, 2016, are as follows:

Tye Burt

Mr. Burt is the Chairman and has been a director of UrtheCast since June 21, 2013. Mr. Burt is Chair and Principal of Carbon Arc Capital Investments Inc., Chair of the University of Guelph Better Planet Project, a Director of ArcelorMittal S.A. and a Governor of the Royal Ontario Museum. From 2005 to 2012, he was President, Chief Executive Officer and a director of Kinross Gold Corporation. From 2010 to 2012, Mr. Burt served on Russia's Foreign Investment Advisory Council, which provides advice on inbound foreign investment to the Prime Minister and the Russian government. Previously, Mr. Burt worked for 16 years in corporate finance and mergers and acquisitions at Cartesian Capital Group, Deutsche Bank AG (as Chairman of Deutsche Bank Canada & Deutsche Bank Securities as well as Head of Global Mining and Metals) and its affiliates and BMO Nesbitt Burns. Mr. Burt is also a former director of MDA and a member of the Duke of Edinburgh's Award Charter for Business Board of Governors.

William (Mac) Evans

Mr. Evans has been a director of UrtheCast since June 21, 2013 and is the Chair of the Technical and Operations Committee. Prior to the Formation Transaction, he had been a director of EVC since August 2012. Mr. Evans was the President of the Canadian Space Agency from November 1994 to November 2001. Mr. Evans led the development of the Canadian Astronaut and RADARSAT programs and negotiated Canada's role in the ISS and a number of international agreements that are the foundation of Canada's international partnerships. In 2004 Mr. Evans was Chief of Staff for the Minister of National Defence (Canada). He is currently Chair of the Defence Advisory Board.

Greg Nordal

Mr. Nordal has been a director of UrtheCast since October 10, 2013 and is the Chair of the Compensation Committee. From 2008 until his retirement in 2016, he led Nelson Education, Canada's leading educational content provider, as President, Chief Executive Officer and a director. Following his retirement, Mr. Nordal remains a board member of Nelson Education Holdings Ltd. Mr. Nordal's expansive executive history also includes roles within Dun & Bradstreet (D&B) Corporation, a premier provider of online business information, as President of its Canadian,

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European and International businesses. Mr. Nordal is also experienced in the tech-space sector, having previously served as a director of MDA.

Letitia A Long

Ms. Long has been a director of UrtheCast since February 23, 2015. She is also a director of Raytheon Company. From 2010 to 2014 she was the Director of the National Geospatial-Intelligence Agency in the United States. From 2006 to 2010, she was the Deputy Director of the Defense Intelligence Agency. These positions culminated a career in the US Intelligence Community that spanned all aspects of organizational leadership, business functions and global operations to include extensive work with the U.S. Congress and international leaders. Ms. Long is currently a Trustee at Noblis, Inc., a leading provider of science and technology and strategy services to the U.S. federal government.

James Topham

Mr. Topham has been a director of UrtheCast since May 11, 2015 and is the Chair of the Audit Committee. He has 30 years of public practice experience as a Chartered Accountant and prior to his retirement in 2008, was a Technology Partner of KPMG's Vancouver office. Mr. Topham was also a founder and for the first nine years, board member of the BC Technology Industry Association. In 2003, Mr. Topham founded the predecessor to the BC Cleantech CEO Alliance, to promote the cleantech industry in BC. Mr. Topham currently serves on the board of two other public technology companies and works with several other private technology companies.

Wade Larson

Mr. Larson is the President and Chief Executive Officer of the Company and has been a director of UrtheCast since June 21, 2013. Mr. Larson acted as the President and Chief Operating Officer of UrtheCast until December 9, 2015. Prior to the Formation Transaction, he had been an Executive Vice-President (since June 2012) and a director (since August 2012) of EVC. Before co- founding EVC, Mr. Larson spent over 17 years in the space sector while working at the Canadian Space Agency and at MDA.

Peter Duggan

Mr. Duggan is the Executive Vice-President, Operations of the Company. From February 2014 until January 2016 he was the VP, Programs of the Company. Prior to joining UrtheCast, he spent 15 years at MDA where he held management roles on the Radarsat-2 Space Mission (launched 2007), the Cassiope Space Mission (launched 2013), and the Radarsat Constellation Space Mission. Most recently, he was Operations Director for Space Missions.

Issa Nakhleh

Mr. Nakhleh will remain as Chief Financial Officer of UrtheCast until his resignation becomes effective on March 29, 2017. Prior to the Formation Transaction, he had been the Chief Financial Officer of EVC since September 2012. From September 2000 to January 2006, Mr. Nakhleh served as Chief Financial Officer of TIR Systems Ltd., a TSX listed company. From January 2006 to June 2006, Mr. Nakhleh served as Chief Financial Officer of First Venture Technologies Inc., a TSX Venture Exchange listed company. Subsequently, and prior to joining EVC, Mr. Nakhleh served as Chief Financial Officer of Heart Force Medical Inc., a private medical device development company.

Sai W. Chu

Mr. Chu will become the Chief Financial Officer of UrtheCast on March 29, 2017. Prior to joining UrtheCast as a consultant in 2017, Mr. Chu served as the Chief Financial Officer of Vancouver-based Seaspan Corporation where he played a key role in its growth from a $500 million-enterprise value, privately-held company to a New York Stock Exchange-listed company with an enterprise value in excess of $7 billion. During Mr. Chu's twelve-year tenure at Seaspan, it became the largest container ship lessor in the world, raising over $10 billion in capital through a series of transactions to support its growth. Prior to joining Seaspan, Mr. Chu was the Corporate Controller at TSX-listed

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Datawest Solutions Inc., which is now part of Fiserv Inc. Mr. Chu qualified as a Certified Management Accountant in 1990 and as a Chartered Accountant in 1992, having articled with KPMG's Vancouver office.

George Tyc

Mr. Tyc is the Chief Technology Officer and a director of UrtheCast. Prior to the Formation Transaction, he had been the Chief Technology Officer of EVC since March 2012 and a director of EVC since August 2012. Prior to his position at EVC, Mr. Tyc was the Technical Director of Smallsats at MDA from June 2001 to March 2012.

Jeff Rath

Mr. Rath is Executive Vice-President of Corporate Finance and Strategy of UrtheCast. Prior to the Formation Transaction, he held the same position with EVC since January 2013. Prior to joining EVC, Mr. Rath spent 14 years as a senior member of Canaccord Genuity Corporation's global research team and a managing director within its technology equity research practice covering Location Technology and Digital Media.

Chris Hoeschen

Mr. Hoeschen is Executive Vice-President, General Counsel and Corporate Secretary of UrtheCast. Prior to joining UrtheCast, Mr. Hoeschen spent five years working at MDA, eventually serving as the Director of Legal Affairs for the company. Before working at MDA, Mr. Hoeschen was in private practice as a corporate solicitor at Lawson Lundell LLP.

To the Company's knowledge, as of the date of this AIF, the current directors and executive officers of the Company as a group beneficially own, or control or direct, directly or indirectly, a total of 7,994,431 Common Shares, representing approximately 6.7% of the Company's total outstanding Common Shares.

Corporate Cease Trade Orders or Bankruptcies

Except as disclosed below, no director or executive officer of UrtheCast or a shareholder holding a sufficient number of securities of UrtheCast to affect materially the control of UrtheCast, within ten years before the date of this AIF, has been a director, chief executive officer or chief financial officer of any company (including UrtheCast) that, while that person was acting in the capacity as director, chief executive officer or chief financial officer, or which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer,

(a) was subject to a cease trade or similar order, or an order that denied the relevant company access to any exemption under securities legislation that was in effect for a period of more than 30 consecutive days; or

(b) within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets.

Until his retirement in 2016, Mr. Nordal was President, CEO and director of Nelson Education Ltd. ("Nelson"). He remains a board member of Nelson Education Holdings Ltd ("Holdings"). On May 12, 2015, Nelson and Holdings obtained an order from the Ontario Superior Court of Justice (Commercial List) initiating proceedings under the Companies' Creditors Arrangement Act (Canada) (the "CCAA Proceedings"). The CCAA Proceedings were a mechanism that allowed Nelson, pursuant to a going-concern sale transaction, to transfer substantially all of its assets and property as a going concern to an entity owned by its senior secured creditors. The CCAA Proceedings were completed in September 2015 and the Nelson business now operates in the normal course.

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Penalties or Sanctions

No director or executive officer of UrtheCast, or a shareholder holding a sufficient number of securities of UrtheCast to affect materially the control of UrtheCast, has

(a) been subject to any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or

(b) been subject to any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable investor in making an investment decision about UrtheCast.

Personal Bankruptcies

No director or executive officer of UrtheCast or a shareholder holding a sufficient number of securities of UrtheCast to affect materially the control of UrtheCast, has, within the 10 years before the date of this AIF, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or been subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the director, executive officer or shareholder.

Conflicts of Interest

To the knowledge of UrtheCast, and other than as disclosed herein, there are no known existing or potential material conflicts of interest among UrtheCast, its directors and officers or a subsidiary of UrtheCast and any director or officer of UrtheCast or of a subsidiary of UrtheCast, or other members of management as a result of their outside business interests, except that certain of the directors or officers may serve as directors and officers of other companies, and therefore it is possible that a conflict may arise between their duties to UrtheCast and their duties as a director or officer of such other companies. See "Risk Factors – Risks Related to UrtheCast's Directors, Officers and Employees".

The directors of UrtheCast are required by law to act honestly and in good faith with a view to the best interests of UrtheCast and to disclose any interests that they may have in any material contract or material transaction. If a conflict of interest arises at a meeting of the Board of Directors of the Company, any director in a conflict is required to disclose his or her interest and abstain from voting on such matter. The directors and officers of UrtheCast are aware of the existence of laws governing accountability of directors and officers for corporate opportunity and requiring disclosures by directors of conflicts of interest in respect of UrtheCast and are required to comply with such laws in respect of any directors' and officers' conflicts of interest or in respect of any breaches of duty by any of its directors or officers.

Promoters

No person has acted as a promoter of the Company during the last two completed financial years or during the current financial year.

LEGAL PROCEEDINGS AND REGULATORY ACTIONS

To the best of the Company's knowledge, there are no material legal proceedings by or against the Company or affecting any of its interest as of the date of this AIF, nor is the Company aware that any such proceedings are contemplated.

Furthermore, there are no: (a) penalties or sanctions imposed against the Company by a court relating to securities legislation or by a securities regulatory authority during its most recently completed financial year; (b) other penalties or sanctions imposed by a court of regulatory body against the Company that would likely be considered important to a reasonable investor in making an investment decision in the Company; or (c) settlement agreements the

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Company entered into before a court relating to securities legislation or with a securities regulatory authority during its most recently completed financial year.

INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS

None of the following persons have had any direct or indirect material interest in any transaction of the Company within the three most recently completed financial years or during the current financial year that has materially affected or is reasonably expected to materially affect the Company:

• a director or executive officer of the Company; • a person or company that beneficially owns, or controls or directs, directly or indirectly, more than 10% of any class or series of the outstanding voting securities of the Company; and • an associate or affiliate of any of the persons or companies referred to in this section.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar of UrtheCast's Common Shares is TSX Trust Company, located at its offices in Vancouver, British Columbia, Canada.

MATERIAL CONTRACTS

The following is a summary of each material contract, other than contracts entered into in the ordinary course of UrtheCast's business, that was entered into in the financial year ending December 31, 2016 or up to the date of this AIF or before the date hereof that is still in effect.

(a) Five-year contract dated November 24, 2014 with a confidential third-party customer, which is valued at US $65 million and pursuant to which the Company will provide engineering services, value-added services and Earth imagery data. See "General Development of the Business – Three Year History – Engineering Services".

(b) Share Purchase and Sale Agreement dated June 22, 2015, with Elecnor, S.A. and Elecnor Deimos Space (collectively, the "Sellers"), S.L.U. for the purchase of Sellers' EO businesses, Deimos Imaging, for an aggregate purchase price of €74.2 million. See "General Development of the Business – Three Year History – Deimos Imaging Acquisition".

(c) Loan agreement dated December 11, 2015, between UrtheCast Spain as borrower and Sabadell as lender for a senior secured term loan of €25 million. See "General Development of the Business – Three Year History – Financings".

(d) Rights Plan dated April 6, 2016, between UrtheCast and Equity Financial Trust Company, as rights agent. See "General Development of the Business – Three Year History – Corporate Developments".

(e) Underwriting Agreement dated March 9, 2017 between UrtheCast and syndicate of underwriters in connection with the Company's equity financing completed March 23, 2017. See "General Development of the Business – Three Year History – Financings".

INTERESTS OF EXPERTS

PricewaterhouseCoopers LLP ("PwC"), located at 18 York Street, Suite 2600, Toronto, Ontario, was appointed as Longford's auditor in 2010. Following the completion of the Formation Transaction, PwC, located at 250 Howe Street, Suite 1400, Vancouver, British Columbia, Canada, V6C 3S7 continued on as the auditors of the

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Company. PwC is independent with respect to the Company within the meaning of the Code of Professional Conduct of the Chartered Professional Accountants of British Columbia.

ADDITIONAL INFORMATION

Additional information relating to the Company is available on Company's issuer profile on SEDAR at www.sedar.com. Shareholders may contact the Corporate Secretary of UrtheCast at 33–1055 Canada Place, Vancouver, British Columbia, Canada, V6C 0C3, by faxing a written request to (604) 669-1799, or by calling (604) 669-1788 to request copies of the Company's financial statements and management's discussion and analysis. Additional information regarding directors' and officers' remuneration, and securities authorized for issuance under equity compensation plans, will be contained in the Company's management information circular dated March 29, 2017, for the annual general meeting of shareholders expected to be held on May 4, 2017.

Financial information is provided in the Company's Annual Financial Statements and Annual MD&A for its most recently completed financial year, which is filed and available on Company's issuer profile on SEDAR at www.sedar.com.

AUDIT COMMITTEE

The primary function of UrtheCast's Audit Committee is to assist the UrtheCast Board in fulfilling its financial oversight responsibilities by reviewing and/or overseeing: (i) the financial reports and other financial information provided by UrtheCast to regulatory authorities and shareholders; (ii) the systems for internal corporate controls which have been established by the UrtheCast Board and management; and (iii) UrtheCast's financial reporting processes generally. In meeting these responsibilities, the Audit Committee monitors the financial reporting process and internal control system, reviews and appraises the work of external auditors, and provides an avenue of communication between the external auditors, senior management and the UrtheCast Board. The Audit Committee is also mandated to review and approve all material related party transactions.

Composition of the Audit Committee

The current Audit Committee is comprised of the following members: Greg Nordal, Letitia A Long and James Topham. The Chair of the Audit Committee is James Topham. All of the members of the Audit Committee are independent within the meaning of National Instrument 52-110 – Audit Committees ("NI-52-110") and are considered to be financially literate, as defined by NI-52-110.

Relevant Education and Experience

The relevant education and experience of the members of the Audit Committee are set forth below:

Until his retirement in 2016, Greg Nordal was President, CEO and a director of Nelson Education, Canada's leading provider of educational content for K-12 and post-secondary markets. Following his retirement, Mr. Nordal remains a director of Nelson Education Holdings Ltd. Mr. Nordal was previously President of Sodexo Canada, and prior to that enjoyed a career with Dun & Bradstreet (D & B) as President of their Canadian, European, and International businesses in a series of progressive assignments. Mr. Nordal has also served on the Audit Committee of MDA, and is a past Chair of Second Harvest, a non-profit organization based in Toronto.

Letitia A Long is a director of Raytheon Company. From 2010 to 2014 she was the Director of the National Geospatial-Intelligence Agency (NGA) in the United States. While Director of NGA, Ms. Long led over 10,000 employees and managed a multi-billion dollar budget. From 2006 to 2010, she was the Deputy Director of the Defense Intelligence Agency. Ms. Long is currently a Trustee at Noblis, Inc., a leading provider of science and technology and strategy services to the U.S. federal government.

James Topham has 30 years of public practice experience as a Chartered Accountant and prior to his retirement in 2008, was a Technology Partner of KPMG's Vancouver office. Mr. Topham was also a founder and for

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the first nine years, board member of the BC Technology Industry Association. In 2003, Mr. Topham founded the predecessor to the BC Cleantech CEO Alliance, to promote the cleantech industry in BC. Mr. Topham currently serves on the board of two other public technology companies as well as working with several other private technology companies.

The Audit Committee's Charter

The Charter of the Audit Committee is attached hereto as Appendix "A".

Audit Committee Oversight

The Board has accepted all recommendations of the Audit Committee since it was formed after the completion of the Formation Transaction regarding the recommendation to nominate or compensate an external auditor.

Pre-Approval Policies and Procedures

The Audit Committee has authority and responsibility for pre-approval of all non-audit services to be provided to the Company or its subsidiary entities by the external auditors or the external auditors of the Company's subsidiary entities, unless such pre-approval is otherwise appropriately delegated or if appropriate specific policies and procedures for the engagement of non-audit services have been adopted by the Audit Committee.

External Auditor Service Fees by Category

The aggregate fees billed by the Company's external auditors in each of the last two fiscal years for audit fees are set out in the table below. In the table, "Audit Fees" are fees billed by the Company's external auditor for services provided in auditing the Company's annual financial statements for the subject year. "Audit-Related Fees" are fees not included in audit fees that are billed by the auditor for assurance and related services that are reasonably related to the performance of the audit review of the Company's financial statements. "Tax Fees" are fees billed by the auditor for professional services rendered for tax compliance, tax advice and tax planning. "All Other Fees" are fees billed by the auditor for products and services not included in the foregoing categories. All amounts in the table are expressed in Canadian dollars.

Financial Year Ending Audit Fees Audit-Related Fees Tax Fees All Other Fees December 31, 2016 $ 424,500 $ 60,000 $ 348,400 $Nil December 31, 2015 $206,000 $132,100 $110,610 $89,100(1) Note: (1) Fees with respect to the auditor’s involvement in the Company’s prospectus offerings in 2015. See "General Description of the Business – Three Year History – Financings".

APPENDIX "A"

URTHECAST CORP. (the "Company")

AUDIT COMMITTEE CHARTER

The Audit Committee (the "Committee") is a committee of the board of directors (the "Board") of the Company. The role of the Committee is to provide oversight of the Company's financial management and of the design and implementation of an effective system of internal financial controls as well as to review and report to the Board on the integrity of the financial statements of the Company, its subsidiaries and associated companies. This includes helping directors meet their responsibilities, facilitating better communication between directors and the external auditor, enhancing the independence of the external auditor, increasing the credibility and objectivity of financial reports and strengthening the role of the directors by facilitating in-depth discussions among directors, management and the external auditor. Management is responsible for establishing and maintaining those controls, procedures and processes and the Committee is appointed by the Board to review and monitor them. The Company's external auditor is ultimately accountable to the Board and the Committee as representatives of the Company's shareholders.

The Company shall provide appropriate funding, as determined by the Committee, to permit the Committee to perform its duties under this Charter, to compensate its advisors and to compensate any registered public accounting firm engaged for the purpose of rendering or issuing an audit report or related work or performing other audit, review or attest services for the Company. The Committee, at its discretion, has the authority to initiate investigations, and hire legal, accounting or other outside advisors or experts to assist the Committee, as it deems necessary to fulfill its duties under this Charter.

Duties and Responsibilities of the Audit Committee

External Auditor

• To be directly and solely responsible, subject to shareholder approval, for the appointment, compensation, retention and oversight of any independent auditor (including resolution of disagreements between management and the independent auditor regarding financial reporting) engaged by the Company for the purpose of preparing or issuing an audit report or related work, with each such auditor reporting directly to the Committee.

• To obtain and review annually a report from the independent auditor describing (i) the independent auditor's internal quality-control procedures, (ii) any material issues raised by the most recent internal quality-control review or peer reviews or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm, and any steps taken to deal with such issues, and (iii) all relationships between the independent auditor and the Company.

• To review with the independent auditor any accounting adjustments that were noted or proposed by the independent auditor but that were "passed" (as immaterial or otherwise), and communications between the audit team and the independent auditor's national office respecting auditing or accounting issues presented by the engagement, and any "management" or "internal control" letter or schedule of unadjusted differences issued, or proposed to be issued, by the independent auditor to the Company, or any other material written communication provided by the independent auditor to the Company's management.

• To oversee the work of the external auditor engaged for the purpose of preparing or issuing an auditor's report or performing other audit, review or attest services for the Company, including the resolution of disagreements between management and the external auditor regarding financial reporting.

• To evaluate the audit services provided by the external auditor, pre-approve all audit fees and recommend to the Board, if necessary, the replacement of the external auditor.

• To pre-approve any non-audit services to be provided to the Company by the external auditor and the fees for those services.

• To review and approve the Company's hiring policies regarding partners, employees and former partners and employees of the present and former external auditor of the Company. The Committee has adopted the following guidelines regarding the hiring of any partner, employee, reviewing tax professional or other person providing audit assurance to the external auditor of the Company on any aspect of its certification of the Company's financial statements:

(a) No member of the audit team that is auditing a business of the Company can be hired into that business or into a position to which that business reports for a period of three years after the audit;

(b) No former partner or employee of the external auditor may be made an officer of the Company or any of its subsidiaries for three years following the end of the individual's association with the external auditor;

(c) The CFO must approve all office hires from the external auditor; and

(d) The CFO must report annually to the Committee on any hires within these guidelines during the preceding year.

• To ensure that the head audit partner assigned by the external auditor to the Company, as well as the audit partner charged with reviewing the audit of the Company, are changed at least every five years, to consider issues related to the timing of such rotation and the transition to new lead and reviewing partners, and to consider whether, in order to assure continuing auditor independence, there should be regular rotation of the audit firm, and report any conclusions on these issues to the Board.

• To review with the independent auditor the critical accounting policies and practices used by the Company, all alternative treatments of financial information within generally accepted accounting principles that the independent auditor has discussed with management, the ramifications of the use of such alternative disclosures and treatments and the treatment preferred by the independent auditor.

• To review, at least annually, the relationships between the Company and the external auditor in order to establish the independence of the external auditor.

Financial Information and Reporting

• To review the Company's annual audited financial statements with the CEO and CFO and then the full Board.

• To review the interim financial statements with the CEO and CFO.

• To review and discuss with management and the external auditor, as appropriate:

• The annual audited financial statements and the interim financial statements, including the accompanying management discussion and analysis; and,

• Earnings guidance and other releases containing information taken from the Company's financial statements prior to their release.

• To review the quality and not just the acceptability of the Company's financial reporting and accounting standards and principles and any proposed material changes to them or their application.

• To review with the CFO any earnings guidance to be issued by the Company and any news release containing financial information taken from the Company's financial statements prior to the release of the financial statements to the public. In addition, the CFO must review with the Committee the substance of any presentations to analysts or rating agencies that contain a change in strategy or outlook.

Oversight

• To review with management its assessment of the effectiveness of and adequacy of the Company's internal control structure and procedures for financial reporting (the "Internal Controls") and consider whether any changes to the Internal Controls are appropriate in light of management's assessment.

• To review and monitor the Company's major financial risks and risk management policies and the steps taken by management to mitigate those risks.

• To meet at least annually with management (including the CFO), the internal audit staff, and the external auditor in separate executive sessions and review issues and matters of concern respecting audits and financial reporting.

• To review with the CEO and CFO of the Company any report on significant deficiencies in the design or operation of the Internal Controls that could adversely affect the Company's ability to record, process, summarize or report financial data, any material weaknesses in Internal Controls identified to the auditors, and any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's Internal Controls.

• To review and approve any related-party transactions, after reviewing each such transaction for potential conflicts of interest and other improprieties.

• To establish procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters, and the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters. To adopt, as necessary, appropriate remedial measures or actions with respect to such complaints or concerns.

• In connection with its review of the annual audited financial statements and interim financial statements, the Committee will also review the process for the CEO and CFO certifications (if required by-law or regulation) with respect to the financial statements and the Company's disclosure and internal controls, including any material deficiencies or changes in those controls.

Membership

• The Committee shall consist solely of three or more members of the Board, each of whom the Board has determined has no material relationship with the Company and is otherwise "unrelated" or "independent" as required under applicable securities rules or applicable stock exchange rules.

• Any member may be removed from office or replaced at any time by the Board and shall cease to be a member upon ceasing to be a director. Each member of the Committee shall hold office until the close of the next annual meeting of shareholders of the Company or until the member ceases to be a director, resigns or is replaced, whichever first occurs.

• The members of the Committee shall be entitled to receive such remuneration for acting as members of the Committee as the Board may from time to time determine.

• All members of the Committee must be "financially literate" (i.e., have the ability to read and understand a set of financial statements such as a balance sheet, an income statement and a cash flow statement). In addition, if required by applicable additional securities regulators or stock exchange rules, at least one member of the Committee shall qualify as a "financial expert" within the meaning of such rules and regulations.

Procedures

• The Board shall appoint one of the directors elected to the Committee as the Chair of the Committee (the "Chair"). In the absence of the appointed Chair from any meeting of the Committee, the members shall elect a Chair from those in attendance to act as Chair of the meeting.

• The Chair will appoint a secretary (the "Secretary") who will keep minutes of all meetings. The Secretary does not have to be a member of the Committee or a director and can be changed by simple notice from the Chair.

• No business may be transacted by the Committee except at a meeting of its members at which a quorum of the Committee is present or by resolution in writing signed by all the members of the Committee. A majority of the members of the Committee shall constitute a quorum, provided that if the number of members of the Committee is an even number, one-half of the number of members plus one shall constitute a quorum.

• The Committee shall meet at least quarterly (or more frequently as circumstances dictate).

• The time and place of the meetings of the Committee, the calling of meetings and the procedure in all respects of such meetings shall be determined by the Committee, unless otherwise provided for in the bylaws of the Company or otherwise determined by resolution of the Board.

• The Committee shall have the resources and authority necessary to discharge its duties and responsibilities, including the authority to select, retain, terminate, and approve the fees and other retention terms (including termination) of special counsel, advisors or other experts or consultants, as it deems appropriate.

• The Committee shall have access to any and all books and records of the Company necessary for the execution of the Committee's obligations and shall discuss with the CEO or the CFO such records and other matters considered appropriate.

• The Committee has the authority to communicate directly with the internal and external auditors.

Reports

• The Committee shall produce the following reports and provide them to the Board:

(a) An annual performance evaluation of the Committee, which evaluation must compare the performance of the Committee with the requirements of this Charter. The performance evaluation should also recommend to the Board any improvements to this Charter deemed necessary or desirable by the Committee. The performance evaluation by the Committee shall be conducted in such manner as the Committee deems appropriate. The report to the Board may take the form of an oral report by the Chair or any other member of the Committee designated by the Committee to make this report.

(b) A summary of the actions taken at each Committee meeting, which shall be presented to the Board at the next Board meeting.