Poynt Corporation
TSX VENTURE : PYN

Poynt Corporation

April 04, 2011 08:00 ET

Poynt Corporation Announces Closing of $15.5 Million Private Placement of Special Warrants to Socius Capital Group and Other Strategic Investors

CALGARY, ALBERTA--(Marketwire - April 4, 2011) -

NOT FOR DISSEMINATION IN THE UNITED STATES

Poynt Corporation ("Poynt Corp." or the "Company") (TSX VENTURE:PYN), a leading provider of mobile local search services, today announced that it has closed its previously announced private placement (the "Offering") of special warrants ("Special Warrants") for gross proceeds of $15,500,000. The Offering was placed to certain strategic investors, with Socius Capital Group ("Socius") being the lead participant with an investment of $10,000,000. Socius, with offices in Los Angeles and New York, has an impressive record of investing in emerging growth companies. 

"This offering, and in particular, the strategic investment by Socius provides Poynt with the resources to accelerate our business plan," said Andrew Osis, CEO, Poynt Corp. "Socius provides access to certain relationships that will further expand our geographic footprint, as well as provide access to business and financial relationships."

Versant Partners Inc. (the "Agent") acted as agent for Poynt in respect of the Offering. A selling group was included in the Offering, a member of which was Roth Capital Partners in the United States. The Company issued an aggregate of 81,578,946 Special Warrants in the Offering, at a price of $0.19 per Special Warrant.

Each Special Warrant is exercisable by the holder at any time after the closing of the Offering, for no additional consideration, into one common share of the Company ("Common Share") and one-half of one Common Share purchase warrant ("Warrant"). Each whole Warrant entitles the holder to purchase one Common Share at a price of $0.19 per share for a period of five (5) years from the date of issuance of the Warrants. All unexercised Special Warrants will be deemed to be exercised on the earlier of (the "Qualification Deadline"): (a) four months and a day following the date of closing of the Offering (the "Closing Date"); and (b) the first business day after a receipt is issued for a final prospectus by or on behalf of the Alberta Securities Commission and the Ontario Securities Commission qualifying the Common Shares and Warrants to be issued upon the exercise of the Special Warrants.

Each holder of Warrants is entitled, for a period of five business days beginning on the date of issuance of the Warrants (and provided that if the Warrants are at the Qualification Deadline subject to any contractual escrow provisions, such time period will commence at such time as the Warrants are no longer subject to such contractual escrow provisions), to exercise the Warrants by surrendering them to the Company in exchange for the issuance of that number of Common Shares determined by dividing the fair value of the Warrants to be exercised (which value was determined as of the Closing Date pursuant to the Black-Scholes option pricing model to be $0.146 per Warrant) into the last closing price of the Common Shares on the TSX Venture Exchange (the "TSXV") immediately prior to the date of surrender.

For services in connection with the Offering, the Agent and the selling group received from the Company a cash commission (the "Commission") of $424,500 and were granted non-transferable warrants (the "Agent's Warrants") of the Company entitling the holder to acquire, for no additional consideration, 2,628,947 compensation options (the "Agent's Options") of the Company. Each Agent's Option is exercisable by the holder to acquire one Common Share at a price of $0.19 per share for a period of 24 months from the Closing Date. In addition, Canaccord Genuity Corp. acted as a special financial advisor to the Company in connection with the Offering and will be paid a cash fee in consideration for such services (the "Special Advisor Fee"). Further, a third party (the "Advisor") who had provided advisory services to the Company was paid a cash fee of $850,500.00 (the "Advisor Fee") at the Closing Date and was granted non-transferable warrants (the "Advisor Warrants") of the Company entitling it to acquire, for no additional consideration, 4,476,315 options (the "Advisor Options") of the Company. Each Advisor Option is exercisable by the holder to acquire one Common Share at a price of $0.19 per share for a period of 24 months from Closing Date. The payment of the Commission, the Special Advisor Fee and the Advisor Fee and the issuance of the Agent's Warrants and Advisor Warrants has been conditionally approved by the TSXV.

The Company intends to use the net proceeds of the Offering to further accelerate its business plan through the addition of personnel in engineering, sales and administrative roles, to evaluate and if determined to be in the best interests of the Company, pursue business development opportunities including acquisitions from third parties and for general working capital purposes. 

The Special Warrants, the Common Shares, the Warrants issued upon exercise of the Special Warrants, the Agent's Warrants, the Agent's Options, the Common Shares issuable pursuant to the Agent's Options, the Advisor Warrants, the Advisor Options and the Common Shares issued upon exercise of the Agent's Options are subject to a hold period under Canadian securities laws of four months and a day from the Closing Date.

The Company has agreed to use reasonable efforts to file a preliminary short form prospectus with the securities commissions in Alberta and Ontario, to qualify the distribution of the Common Shares and Warrants to be issued upon the deemed exercise of the Special Warrants, the distribution of the Agent's Options upon exercise of the Agent's Warrant and the distribution of the Advisor Options upon exercise of the Advisor Warrants.

Upon exercise of the Special Warrants acquired by Socius in the Offering, Socius will hold approximately 12% of the currently outstanding Common Shares (inclusive of the Common Shares issued on exercise of all of the Special Warrants) or approximately 18% of the currently outstanding Common Shares if all of the Warrants to be issued to Socius are exercised. As a result, pursuant to the policies of the TSXV, the Special Warrants issued to Socius (and the Common Shares and Warrants issuable thereunder) and the subscription funds received by the Company for such Special Warrants will be held in escrow pending receipt of all required approvals of the TSXV.

This press release shall not constitute an offer for sale of the securities in the United States. The securities offered 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 exemption from those registration requirements.

About Poynt Corporation

Poynt Corp. (about.poynt.com) is a global leader in the mobile local advertising space. Their Location Based Search application, Poynt (www.poynt.com), enhances the consumers' ability to connect with the people, businesses and events most important to them. Poynt is available on BlackBerry smartphones, iPhone and iPod Touch, Android, Windows Phone 7 and Nokia QT devices in Canada, the United States, Europe and Australia. Poynt Corp. entered the mobile publishing space with the recent acquisition of an advertising publishing platform. Key contracts on both the supply and demand sides are in place to provide inventory into the platform and publishers to display the inventory. Whether through the Poynt Local Search App or the Ad Publishing Platform, Poynt Corp. simplifies connecting consumers with businesses, retailers and events. Headquartered in Calgary, AB, Canada, Poynt Corp. trades on the TSXV under the symbol PYN.

Forward Looking Statement

This news release contains forward-looking statements relating to the Offering and other statements that are not historical facts, including statements regarding the use of proceeds of the Offering, the terms of the Special Warrants and other securities issued pursuant to or in connection with the Offering, and the filing of a prospectus to qualify the distribution in certain Canadian jurisdictions of Common Shares and Warrants on deemed exercise of the Special Warrants. Such forward-looking statements are subject to important risks, uncertainties and assumptions. The results or events predicated in these forward-looking statements may differ materially from actual results or events. As a result, you are cautioned not to place undue reliance on these forward-looking statements.

These forward-looking statements are based on certain key assumptions regarding, among other things: state of the economy in general and capital markets in particular, investor interest in the Company's business and future prospects, the timing of and receipt of all necessary regulatory approvals. Material risk factors that could cause actual results to differ materially from the forward-looking information include, but are not limited to: the risk that closing of the Offering could be delayed if the Company is not able to obtain the necessary regulatory and stock exchange approvals on the timelines it has planned; the risk that the intended use of the net proceeds of the Offering by the Company might change if the board of directors of the Company determines that it would be in the best interests of the Company to deploy the proceeds for some other purpose; risks that the marketing efforts will not result in the anticipated proceeds; the deteriorating economic and market conditions that could lead to reduced spending on information technology products; competition in our target markets; potential capital needs; management of future growth and expansion; the development, implementation and execution of the Company's strategic vision; risk of third-party claims of infringement; protection of proprietary information; customer acceptance of the Company's existing and newly introduced products and fee structures; and the success of the Company's brand development efforts; risks associated with strategic alliances; reliance on distribution channels; product concentration; need to develop new and enhanced products; potential product defects; our ability to hire and retain qualified employees and key management personnel; and risks associated with changes in domestic and international market conditions and the entry into and development of new for the Company's products.

The forward-looking statements contained in this press release are made as of the date of this press release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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.

Contact Information

  • Financial Communications Contact:
    Trilogy Capital Partners
    Darren Minton
    President
    Toll-free: 800-592-6067
    info(at)trilogy-capital.com
    or
    Poynt Corporation:
    Andrew Osis
    President & CEO
    403-313-3719
    http://about.poynt.com