ePals Closes Third Tranche of Non-Brokered Private Placement

Not for Distribution to United States Newswire Services or Dissemination in the United States

Marketwired

WASHINGTON, DC--(Marketwired - Dec 20, 2013) - ePals Corporation (TSX VENTURE: SLN) ("ePals" or the "Company") has completed the third tranche of its previously announced non-brokered private placement (the "Offering") and issued 22,278,812 units of the Company (each, a "Unit") at a price of C$0.075 per Unit for gross proceeds of C$1,670,911. Each Unit consists of one common share of the Company and one-third of one common share purchase warrant (each whole warrant, a "Warrant"). Each Warrant entitles the holder to purchase one additional common share of the Company at a price of C$0.075 until April 30, 2014. 

An aggregate of 21,078,814 of the Units issued consisted of one restricted voting common share and one-third of one Warrant, with each Warrant being exercisable to acquire one restricted voting common share. An aggregate of 1,199,998 of the Units issued consisted of one voting common share and one-third of one Warrant, with each Warrant being exercisable to acquire one voting common share. Each restricted voting common share is convertible into one voting common share at any time at the option of the holder. The restricted voting common shares are not listed or posted for trading on the TSX Venture Exchange or any other stock exchange or marketplace and do not carry the right to vote for the election of directors of the Company.

The Company intends to use the net proceeds of the Offering for general corporate purposes and working capital. 

Subscriptions by insiders of the Company accounted for approximately Cdn$137,500 of the gross proceeds of this third tranche of the Offering. Participation in this third tranche of the Offering by the insiders is exempt from the valuation and minority shareholder approval requirements of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101") by virtue of the exemptions contained in Sections 5.5(b) and 5.7(1)(b) of MI 61-101. 

The securities described herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from those registration requirements. This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there by any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

All securities issued pursuant to the Offering are subject to resale restrictions for a period of four months from the closing date of the applicable tranche of the Offering.

About ePals Corporation

ePals Corporation (TSX VENTURE: SLN) is an education media company and the leading Global Learning Network. Focused on the K-12 market, ePals offers school administrators, teachers, students and parents worldwide trusted content, interactive learning experiences, and a collaborative learning community.

ePals' award-winning products include: popular children's educational publishing brands from toddlers to teens, including CricketR and CobblestoneR; the ePals Global CommunityR; and In2BooksR, a common core eMentoring program that builds reading, writing and critical thinking skills. ePals also offers SchoolMail365 and has recently launched ToolsforSchool.com, a teaching resource marketplace connecting educators to original, classroom-tested content. Also new is a full service content-licensing, clearance and production service for education publishers. ePals serves approximately 1 million classrooms and reaches millions of teachers, students and parents in 222 countries and territories.

Product websites include: www.ePals.com; www.Cricketmag.com; www.In2Books.com; and www.ToolsforSchool.com. Corporate information is available at www.corp.ePals.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward Looking Statements

This press release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements regarding the completion of the Offering and the expected use of proceeds of the Offering. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by the Company and described in the forward-looking statements contained in this press release. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do so, what benefits the Company will derive there from. The forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

Contact:
Contact Information:

Aric Holsinger
Chief Financial Officer
ePals Corporation
Phone: (703) 885-3400
aholsinger@corp.epals.com

Cory Pala
Investor Relations
E.vestor
Phone: (416) 657-2400
cpala@corp.epals.com

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