OKALLA CORP.
TSX VENTURE : AOK

OKALLA CORP.

June 05, 2008 16:53 ET

Okalla Amalgamation Update

CALGARY, ALBERTA--(Marketwire - June 5, 2008) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW.

Okalla Corp. ("Okalla" or the "Corporation") (TSX VENTURE:AOK) is pleased to announce that it has received conditional approval of the TSX Venture Exchange (the "Exchange") for the proposed amalgamation of Okalla and Racing Around Wholesale, Inc. ("Racing Around"), a North American distributor of licensed sports merchandise based in Nova Scotia, as previously announced. The completion of the amalgamation and listing of the shares of the resulting issuer on the Exchange is subject to the receipt of the approval of the shareholders of Okalla, the completion of the previously announced concurrent financing in the minimum amount of $500,000 and the confirmation of at least 200 public shareholders of the resulting issuer holding at least one board lot of resulting issuer shares. The resulting issuer ("Amalco") will be a Tier 2 Industrial Issuer on the Exchange.

Concurrently with the conditional approval of the Exchange, the information circular detailing the particulars of Racing Around and the Amalgamation has been delivered to the shareholders of Okalla seeking the approval of the Amalgamation at a special meeting convened for the purpose to be held on June 9, 2008. In connection with the Amalgamation, Haywood Securities Inc. ("Haywood") has been engaged by Okalla to act as sponsor.

The Amalgamation Agreement entered into in connection with the proposed transaction has been amended to extend the deadline for completion of the transaction to July 31, 2008 and to change the name of the resulting issuer to "SportsClick Inc." The proposed name of the resulting issuer is subject to regulatory approval.

As previously announced, the Amalgamation will be completed in conjunction with a proposed brokered equity offering by the Amalco (the "Offering") immediately following the completion of the Amalgamation. Haywood has been appointed as an Agent for and on behalf of Okalla pursuant to the Offering to raise, on a commercially reasonable efforts basis, a minimum of CAD$500,000 from the sale of Units of Amalco (the "Units") at a price of $0.40 per Unit.

Each Unit consists of one (1) Common Share (a "Common Share") and one-half ( 1/2) of one non-transferable Common Share Purchase Warrant (a "Warrant"), each whole Warrant entitling the holder thereof to purchase one (1) additional Common Share at a price of $0.50 for a period of 18 months from the date of issue.

Haywood will receive a cash commission equal to 7% of the gross proceeds received by Racing Around from the sale of the Units, in addition to a corporate finance fee of $12,500. The Agent will receive a non-transferable option (the "Agent's Option") to acquire that number of Units that is equal to 7% of the gross number of Units sold, at a price of $0.30 per Common Share for a period of 18 months from the date of closing.

Racing Around intends to utilize the net proceeds from the Offering to investigate opportunities complementary to Racing Around's current core business and for general operating and working capital purposes.

Racing Around is a privately held company incorporated under the laws of Nova Scotia which is engaged in the sale and distribution of quality licensed sports apparel and accessories with trademarked logos and images focusing on the sports of auto racing, hockey, football, basketball and baseball throughout the North American marketplace.

As indicated above, completion of the Proposed Amalgamation is subject to a number of conditions, including but not limited to TSX Venture Exchange acceptance and disinterested Okalla Shareholder approval. The transaction cannot close until the required Okalla Shareholder approval is obtained. There can be no assurance that the Proposed Amalgamation will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Proposed Amalgamation, any information released or received with respect to the Proposed Amalgamation may not be accurate or complete and should not be relied upon. Trading in the Okalla Shares should be considered highly speculative.

Haywood, subject to completion of satisfactory due diligence, has agreed to act as sponsor in connection with the transaction. An agreement to sponsor should not be construed as any assurance with respect to the merits of the transaction or the likelihood of completion.

This news release does not constitute an offer to sell or the solicitation of an offer to buy the securities, or a solicitation of proxies, in any jurisdiction, including but not limited to, the United States. The Okalla Shares 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 laws and may not be offered or sold in the United States except in certain transactions exempt from the registration requirements of the U.S. Securities Act and applicable state securities laws.

Except for the historical and present factual information contained herein, the matters set forth in this news release, including words such as "expects", "projects", "plans", "anticipates" and similar expressions, are forward-looking information that represents management of Okalla's internal projections, expectations or beliefs concerning, among other things, future operating results and various components thereof or the economic performance of Okalla. The projections, estimates and beliefs contained in such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause Okalla's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, those described in Okalla's filings with the Canadian securities authorities. Accordingly, holders of Okalla shares and potential investors are cautioned that events or circumstances could cause results to differ materially from those predicted. Okalla disclaims any responsibility to update these forward-looking statements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy and accuracy of this release.

Contact Information