VersaPay Corporation

TSX VENTURE : VPY


VersaPay Corporation

January 13, 2014 07:58 ET

VersaPay Corporation Announces $5 Million Bought-Deal Financing

TORONTO, ONTARIO--(Marketwired - Jan. 13, 2014) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE U.S.

VersaPay Corporation (TSX VENTURE:VPY) ("VersaPay" or the "Company") today announced that it has entered into an agreement with Mackie Research Capital Corporation ("MRCC") pursuant to which a syndicate of underwriters (the "Underwriters") led by MRCC, will purchase, on a bought-deal private placement basis, 4,167,000 units of the Company ("Units" or the "Securities") at a price of $1.20 per Unit (the "Issue Price") for aggregate gross proceeds to the Company of $5,000,400 (the "Offering"). Each Unit shall be comprised of one common share of the Company (each, a "Common Share") and one-half (1/2) of one Common Share purchase warrant (each whole Common Share purchase warrant, a "Warrant"). Each Warrant shall be exercisable to acquire an additional Common Share (each, a "Warrant Share") at an exercise price of $1.50 per Warrant Share for a period of 24 months following the closing of the Offering.

The Underwriters shall also have the option (the "Underwriters' Option"), exercisable at any time on or prior to the date that is 30 days following the closing date of the Offering, to purchase from VersaPay up to an additional 15% of the number of Units sold pursuant to the Offering.

The Offering will take place by way of a private placement to qualified investors in such provinces of Canada as the Underwriters may designate, and otherwise in those jurisdictions where the Offering can lawfully be made, including but not limited to the United States under applicable private placement exemptions. The securities to be issued under the Offering will have a hold period of four months and one day from closing of the Offering.

The proceeds raised from the sale of Units will be used by the Company to fund the growth of the eInvoice Solutions division and for general corporate and working capital purposes.

The Offering is expected to close on or about the week of February 3rd, 2014.

In consideration for their services, the Underwriters will receive a cash commission equal to 7.0% of the gross proceeds of the Offering, and such number of broker warrants ("Broker Warrants") equal to 7.0% of the aggregate number of Units issued pursuant to the Offering. Each Broker Warrant is exercisable for one Unit at the Issue Price for a period of 24 months from closing of the Offering.

The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

About VersaPay

VersaPay is a financial technology company that delivers payment solutions for businesses. Serving more than 2,500 customers, VersaPay, together with its partners, provides the hardware, technology, infrastructure and support services to enable businesses of all types to accept and process electronic payments. In addition, the Company's cloud-based invoice presentment and payment platform facilitates the efficient exchange of documents and payments between suppliers and customers. VersaPay is headquartered in Toronto, Canada and has operations in Montreal and New York. More information about VersaPay can be found at www.versapay.com.

Forward-Looking and other Cautionary Statements

This news release contains forward-looking statements and information that are based on the beliefs of management and reflect the Company's current expectations. When used in this news release, the words "estimate", "project", "belief", "anticipate", "intend", "expect", "plan", "predict", "may" or "should" and the negative of these words or such variations thereon or comparable terminology, are intended to identify forward-looking statements and information. Such statements and information reflect the current view of the Company with respect to risks and uncertainties that may cause actual results to differ materially from those contemplated in those forward-looking statements and information.

By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, risks relating to the speculative nature of the Company's business, the Company's formative stage of development and the Company's financial position. Forward-looking statements are made based on management's beliefs, estimates and opinions on the date that statements are made and the Company undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change.

Investors are cautioned against attributing undue certainty to forward-looking statements. There are a number of important factors that could cause the Company's actual results to differ materially from those indicated or implied by forward-looking statements and information. Such factors include, among others, risks related to following: the Company's financial position and the potential need for future financings, the ability of the Company to maintain its relationship with its strategic partner for payment processing, the efforts and abilities of the senior management team, the ability of the Company to attract and retain skilled management, competition in the payment processing industry, and the Company's ability to respond to technological change and protect its intellectual property rights.

The Company cautions that the foregoing list of material factors is not exhaustive. When relying on the Company's forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed a certain progression, which may not be realized. It has also assumed that the material factors referred to in the previous paragraph will not cause such forward-looking statements and information to differ materially from actual results or events. There can be no assurance that such assumptions will reflect the actual outcome of such items or factors.

THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME EXCEPT AS REQUIRED IN ACCORDANCE WITH APPLICABLE SECURITIES LEGISLATION.

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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