SOURCE: ePals

ePals

August 24, 2011 08:00 ET

ePals Acquires Newstogram™ Media Personalization Platform

Acquisition Extends Company's Media Business and Strengthens Partner Network

HERNDON, VA--(Marketwire - Aug 24, 2011) - ePals Corporation (TSX-V: SLN) ("ePals"), an education technology company and leading safe social learning network ("SLN"), today announced its acquisition of the Newstogram™ platform (www.newstogram.com) and the DailyMe® service (www.dailyme.com) business from Nexify, Inc.

The acquisition provides ePals with a robust technology platform for personalization of quality media and learning applications, as well as enhancing its capability to match learners with each based on interests, across the ePals network of approximately 700,000 classrooms and millions of users in 200 countries. It will allow media publishers -- including more than 20 major media companies that currently use the Newstogram platform -- to create "educational" pages that highlight their content and add further breadth and depth to their offerings for family audiences.

The acquisition will also significantly extend ePals' management capabilities in the rapidly expanding online educational media industry, adding Eduardo Hauser and Neil Budde as President and EVP, respectively, of ePals' Media Division. Before founding Nexify, Hauser was EVP of Latin America for AOL and VP News and Information at Venevision. He is on the board of directors of NPR and the Knight Foundation's Journalism Advisory Board. Neil Budde previously was the founding editor and publisher of The Wall Street Journal Online, and VP and Editor in Chief of Yahoo! News, Finance and Sports.

"In acquiring the assets of Nexify and bringing seasoned media veterans like Eduardo and Neil on board, ePals has gained the technology and expertise to better serve our users and partners as we continue to build out a powerful education platform that is unique to the space," said Miles Gilburne, CEO of ePals. "We believe the dynamic personalization and matching capabilities that the Nexify platform has already delivered in general news publishing will have transformational qualities in educational publishing and adaptive learning, as users are matched with quality content and other learners to increase student, teacher and parent engagement and drive demonstrably better outcomes."

"Nexify's leading-edge technology powers advanced features for some of the world's leading content providers, and our team is excited to extend these capabilities into educational media, where personalized content delivery can yield meaningful and lasting results," said Mr. Hauser. "ePals Media will continue to provide media technology to Nexify partners, integrate matching and recommendations technology to the existing ePals products suite, and create a wealth of opportunities for ePals content partners in both the existing ePals network and across the Newstogram network."

Details of the Acquisition

The assets of Nexify, Inc. were acquired by ePals-Nexify, Inc., an indirect wholly-owned Delaware subsidiary of ePals. ePals satisfied payment of the asset purchase price by issuing to Nexify a total of 4,449,686 restricted common voting shares (the "Closing Shares") at a price of US$0.67 per share. In addition, ePals issued to Nexify warrants to acquire an additional 307,000 restricted voting common shares, at a price of US$0.67 per share. The warrants are exercisable, upon vesting, up to four years from the date of closing. The restricted voting common shares and the warrants issued by ePals, and any shares issued upon exercise of the warrants, are subject to a hold period of four months and one day from the date of closing in accordance with applicable Canadian securities laws and the policies of the TSX Venture Exchange. In addition, the Closing Shares are subject to further escrow provisions such that each quarter following the first anniversary of the closing 25% of such shares are released from escrow.

ePals has 67,469,950 voting common shares and 48,017,968 restricted voting common shares (inclusive of the Closing Shares) issued and outstanding. Each restricted voting common share is convertible into one voting common share of ePals.

About ePals Corporation
ePals Corporation (TSX-V: SLN) is an education technology company and leading safe social learning network (SLN). Focused on the K-12 market, ePals offers primary and secondary schools, teachers, students and parents worldwide a safe and secure platform for building educational communities, providing quality digital content and facilitating collaboration for effective 21st century learning. ePals' award-winning products include: the ePals Global Community™; SchoolMail®365, LearningSpace® and In2Books®, a curriculum-based e-mentoring program that builds reading, writing and critical thinking skills. ePals customers and partners include International Baccalaureate, Microsoft Corporation, Dell, Inc., IBM Corp., National Geographic and leading school districts across the United States and globally. ePals connects approximately 700,000 classrooms and millions of teachers, students and parents in approximately 200 countries and territories. For the ePals Global Community, visit www.epals.com. Corporate information is available at www.corp.epals.com.

About Nexify
Nexify is a technology company that is changing the way businesses present and monetize digital content. The company specializes in dynamic personalization for digital media and e-commerce. Its flagship service is Newstogram, a patented behavioral tracking and recommendation technology, which powers personalized news recommendations on hundreds of the world's leading information sites with more than 25 million monthly impressions.

Neither the TSX-V nor its Regulation Services Provider (as that term is defined in the policies of the TSX-V) has in any way passed upon the merits of the Transaction and neither of the foregoing entities has in any way approved or disapproved of the contents of this press release.

Cautionary Statement Regarding Forward-Looking Information:

Certain statements contained in this press release constitute forward-looking information within the meaning of applicable securities laws. These statements relate to future events or future performance. The use of any of the words "could", "intend", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Corporation's current belief or assumptions as to the outcome and timing of such future events. Forward-looking information is necessarily based upon a number of assumptions and factors that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. Those assumptions and factors are based on information currently available to the Corporation. Such material factors and assumptions include, but are not limited to: the Corporation's ability to execute on its business plan; the acceptance of the Corporation's products and services by its customers, including renewals; the timing of execution of outstanding or potential customer contracts by the Corporation; the sales opportunities available to the Corporation; the Corporation's subjective assessment of the likelihood of success of a sales lead or opportunity; that sales will be completed at or above the Corporation's estimated margins; availability of government subsidies; the continued success of business development activities; new products and services will continue to be added to the Corporation's portfolio; demand for webhosting and secure email communication will continue to grow; that the global economy will continue to recover and the demand for our products and services globally will develop and grow; that the regulatory environment continues to develop concerning students, both as to collecting information and narrow casting; and, to the extent needed, that additional financing is available. Although the Corporation has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. The forward-looking information contained in this press release is made as of the date hereof and the Corporation is not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward-looking information. The foregoing statements expressly qualify any forward-looking information contained herein.

Contact Information

  • For further information, please contact:

    Aric Holsinger
    Chief Financial Officer
    ePals Corporation
    Phone: (703) 885-3400

    Jacqueline Van Meter
    Senior Marketing Manager
    ePals Corporation
    Phone: (703) 885-3400