TORONTO, ON--(Marketwired - November 21, 2016) -

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ViXS Systems Inc. ("ViXS" or the "Company") (TSX: VXS), a pioneer and leader in media processing solutions, today announced that it closed, on November 21, 2016, the second and final tranche of its previously announced non-brokered convertible debenture private placement offering (the "Private Placement"). This final tranche raised gross proceeds of C$500,000. In aggregate, the Company has issued C$4,200,000 of secured subordinated convertible debentures as part of this Private Placement (the "Convertible Debentures"). The net proceeds will be used for general corporate and working capital purposes in order to support the growth of the business.

Convertible Debenture Private Placement

The Convertible Debentures issued on November 21, 2016 matures on September 9, 2019 and bears an interest at the rate of 10% per annum, payable semi-annually in arrears in cash, subject to adjustment. The Convertible Debentures are convertible into common shares in the capital of the Company ("Common Shares") at a conversion price of C$0.35 per Common Share, subject to adjustment in certain circumstances.

The Convertible Debentures are secured by a general security interest which is subordinated to the security interests of a senior lender to the Company and to the existing holders of secured debentures of the Company issued on January 12, 2016.

In connection, with the issuance of this tranche of Convertible Debentures, the Company has issued 357,142 Common Shares purchase warrants (the "Convertible Debenture Warrants"). Each Convertible Debenture Warrant is exercisable for one Common Share until September 9, 2017 at an exercise price of C$0.60 per Common Share. Each subscriber of this tranche of Convertible Debentures has been issued that number of Convertible Debenture Warrants that is equal to twenty-five percent (25%) of the number of Common Shares issuable upon conversion of such holder's Convertible Debentures. In aggregate, the company issued 3,000,000 warrants in conjunction with the Convertible Debenture.

The Convertible Debenture Warrants are subject to accelerated expiry if the market price (as such term is defined in the TSX Company Manual) of the Company's Common Shares exceeds $0.65 for a ten consecutive trading day period (the "Accelerated Expiry Period"). The Convertible Debenture Warrants will remain exercisable for 20 trading days following the Accelerated Expiry Period, after which any unexercised Convertible Debenture Warrants shall expire.

This tranche of the Private Placement is exempt from prospectus and registration requirements of applicable securities laws and the underlying securities are subject to a mandatory four-month hold period.

This release does not constitute an offer for sale of securities nor a solicitation for offers to buy any securities. The securities referred to in this press release have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities law and may not be offered or sold to, or for the account or benefit of, persons in the United States or "U.S. persons", as such term is defined in Regulation S promulgated under the U.S. Securities Act, unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

About ViXS Systems Inc.

ViXS is a pioneer and market leader in designing revolutionary media processing semiconductor solutions for video over IP streaming solutions, with over 482 patents issued and pending worldwide, numerous industry awards for innovation, and over 33 million media processor shipped to date. ViXS is driving the transition to Ultra HD 4K across the entire content value chain by providing professional and consumer grade chipsets that support the new High Efficiency Video Coding (HEVC) standard up to Main 12 Profile, reducing bandwidth consumption by 50% while providing the depth of color and image clarity needed to take advantage of higher-resolution content. ViXS' XCodePro 300 family is ideal for Ultra HD 4K infrastructure equipment, and the XCode 6000 family of system-on-chip (SoC) products achieve unprecedented levels of integration that enable manufacturers to create cost-effective consumer entertainment devices.

ViXS is headquartered in Toronto, Canada with offices in Europe, Asia and North America. VIXS™, the ViXS® logo, XCode®, XCodePro™, XConnex™ and Xtensiv™ are trademarks and/or registered trademarks of ViXS. Other trademarks are the property of their respective owners. For more information on ViXS, visit our website: www.vixs.com.

FORWARD LOOKING STATEMENTS

Certain statements in this press release which are not historical facts constitute forward-looking statements or information within the meaning of applicable securities laws ("forward-looking statements"). Such statements include, but are not limited to, statements regarding ViXS' projected revenues, gross margins, earnings, growth rates, the impact of new product design wins, market penetration and product plans. The use of terms such as "may", "anticipated", "expected", "projected", "targeting", "estimate", "intend" and similar terms are intended to assist in identification of these forward-looking statements. Readers are cautioned not to place undue reliance upon any such forward-looking statements. Such forward-looking statements are not promises or guarantees of future performance and involve both known and unknown risks and uncertainties that may cause ViXS' actual results to be materially different from historical results or from any results expressed or implied by such forward-looking statements. Accordingly, there can be no assurance that forward-looking statements will prove to be accurate and readers are therefore cautioned not to place undue reliance upon any such forward-looking statements.

Factors that could cause results or events to differ materially from current expectations expressed or implied by forward looking statements contained herein include, but are not limited to: our history of losses and the risks associated with not achieving or sustaining profitability; the Company's dependence on a limited number of customers for a substantial portion of revenues; fluctuating revenue and expense levels arising from changes in customer demand, sales cycles, product mix, average selling prices, manufacturing costs and timing of product introductions; risks associated with competing against larger and more established companies; competitive risks and pressures from further consoldiation amongst competitors, customers, and suppliers; market share risks and timing of revenue recognition associated with product transitions; risks associated with changing industry standards such as HEVC (High Efficiency Video Codec), HDR (High Dynamic Range) and Ultra HD resolution; risks related to intellectual property, including third party licensing or patent infringement claims; the loss of any of the Company's key personnel could seriously harm its business; risks associated with adverse economic conditions; delays in the launch of customer products; price re-negotiations by existing customers; the Company's dependence on a limited number of supply chain partners for the manufacture of its products, legal proceedings arising from the ordinary course of business; ability to raise needed capital; ongoing liquidity requirements;and other factors discussed in the "Risk Factors" section of the Company's Annual Information Form dated March 31, 2016, a copy of which is available under the Company's profile on SEDAR at www.sedar.com. All forward-looking statements are qualified in their entirety by this cautionary statement. ViXS is providing this information as of the current date and does not undertake any obligation to update any forward-looking statements contained herein as a result of new information, future events or otherwise except as may be required by applicable securities laws.