DealNet Capital Corp.
CNSX : DLS

DealNet Capital Corp.

June 17, 2015 16:38 ET

DealNet Announces Financing Update and Issuance of Stock Options

TORONTO, ONTARIO--(Marketwired - June 17, 2015) - DealNet Capital Corp. ("DealNet" or the "Company") (CSE:DLS) is pleased to announce that it has completed the fourth and final tranche of its private placement that was announced on November 25, 2014 (the "Offering").

The closing today resulted in the issuance of 8,015,836 Units, consisting of 8,015,836 common shares ("Common Shares") and 8,015,836 common share purchase warrants. As consideration for the Units issued in this closing, the Company received subscriptions of $1,019,837 in cash and $503,174 from the full and final settlement of various liabilities owing by the Company. The securities issued today will be subject to a hold period until October 18, 2015.

Included in the closing today were subscriptions from insiders totaling $645,000 as well as employees of the Company for $46,000. The insiders are related parties of the Company under Multilateral Instrument 61-101 ("MI 61-101"). The Company is exempt from the formal valuation requirement and shareholder approval requirement of MI 61-101, as described in more detail in the material change report to be filed in connection with these financings. Having regard to these exemptions and the Company's desire to close the financings described above as soon as possible, the Company believes that it is reasonable to have closed the private placement less than 21 days after the date of this news release.

In connection with this closing, the Company incurred finder's fees of approximately $9,706 and issued 51,086 broker warrants to registered brokers.

The Company is also announcing that it intends to complete a non-brokered private placement for up to $1,500,000 of convertible debentures (the "Debentures"). The Debentures will mature two years from the date of issue, bear interest at the rate of 12% per annum payable quarterly and be secured by the assets of Impact Mobile Inc., a wholly owned subsidiary of the Company, subordinated to the secured line of credit of Impact Mobile. The principal amount of the Debentures will be convertible at the holder's option into common shares of the Company at a conversion price of $0.19 for each Common Share. The Company may, at its option, redeem any or all of the Debentures at any time prior to maturity for the unpaid principal plus accrued but unpaid interest. If the current market price of the Common Shares on the date which the Company provides the redemption notice isn't at least 125% of the conversion price, the Company must also pay an additional amount equal to 20% of the interest the holder would have received if held until maturity.

The Company will use the proceeds of the Debenture offering to redeem all its current Secured Subordinated Debentures which mature on July 29, 2015, along with accrued but unpaid interest, for approximately $1,150,000. The balance will be used for general working capital purposes.

In connection with the Debenture offering, the Company will pay a finder's fee, when applicable, of 7% in cash and 7% in warrants (with a term of 18 months and an exercise price of $0.30) to registered holders.

The Company is also announcing, in accordance with the terms of the Company's stock option plan, the issuance of an aggregate 2,550,000 stock options to directors of the Company. The options will vest over a period of three years and will be exercisable for a period of five years at an exercise price of $0.21 per stock option.

Forward-Looking Statements

This press release contains forward-looking statements. More particularly, this press release refers to the proposed Debenture offering. The forward-looking statements are based on certain expectations and assumptions made by the Company. Although the Company believes that those expectations and assumptions are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those anticipated due to a number of factors and risks. In addition to other risks, the Debenture offering could fail to close. The forward-looking statements contained in this press release are made as of the date hereof. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities laws.

About DealNet Capital Corp.

DealNet Capital Corp. focuses on two key vertical markets, Consumer Engagement and Consumer Finance. Through acquisitions, the Company has become a leader in the Consumer Engagement space helping their corporate customers 'speak' to their consumers the way they want to be spoken to using live Voice, Chat, Text, Email and Proximity based engagement solutions. The Company has leveraged its engagement business to offer home improvement financing solutions to consumers, which offer attractive yields and low default rates. The Company continues to seek acquisitions in these key markets.

For additional information please visit www.sedar.com.

The Canadian Securities Exchange does not accept responsibility for the adequacy or accuracy of this release.

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