Preo Software Inc.
TSX VENTURE : PKM

Preo Software Inc.

September 05, 2012 09:30 ET

Preo Software Inc.: News Release

CALGARY, ALBERTA--(Marketwire - Sept. 5, 2012) -

(NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA)

PREO SOFTWARE INC. (the "Corporation") (TSX VENTURE:PKM). The Corporation is pleased to announce a non-brokered private placement to secure up to $2,000,000 from the issuance of up to 2,000,000 units ("Units") of the Corporation at an issuance price of $1.00. Each Unit shall be comprised of: (a) one dollar ($1.00) principal amount convertible, secured, subordinated debenture ("Debenture") of the Corporation with a term of two (2) years and interest to be paid quarterly at the election of the subscribers as follows: (i) 10% ten percent per annum, to be paid exclusively in the form of cash; or (ii) fifteen percent (15%) per annum, to be paid exclusively by the issuance of common shares ("Common Shares") of the Corporation at a deemed price of $0.15 per share for the first quarter and thereafter, at a deemed price per share that is equal to the market price of the Common Shares on the respective interest payment date; and (b) one (1) Common Share purchase warrant ("Warrant") of the Corporation, with each Warrant entitling the holder thereof to purchase one (1) Common Share at an exercise price of $0.15 per share for a period of twenty-four (24) months. The outstanding principal under the Debentures may be converted into Common Shares at any time at a conversion price of $0.15 per share and shall be automatically converted into Common Shares at $0.15 in the event that the volume weighted trading price of not less than 10,000 Common Shares trade at not less than $0.25 for a minimum of 30 consecutive trading days on the facilities of the TSX Venture Exchange ("Exchange").

A commission of $40,000 will be payable to an arm's length party assuming completion of the proposed financing.

The private placement is subject to receipt of final approval of the Exchange.

Reader Advisory

Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. In particular, forward-looking information in this press release includes an anticipated financing. Although we believe that the expectations reflected in the forward-looking information are reasonable, there can be no assurance that such expectations will prove to be correct. The Corporation cannot guarantee future results, performance or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information.

Forward-looking information is based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: general economic conditions in the financial markets. Investors are cautioned that this list of risk factors should not be construed as exhaustive.

The forward-looking information contained in this news release is expressly qualified by this cautionary statement. We undertake no duty to update any of the forward-looking information to conform such information to actual results or to changes in our expectations except as otherwise required by applicable securities legislation. Investors are cautioned not to place undue reliance on forward-looking information.

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.

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