VoodooVox Inc.

CNSX : VVX


VoodooVox Inc.

February 05, 2014 18:10 ET

VoodooVox Inc. Announces Private Placement

$4.9M gross proceeds

TORONTO, ONTARIO--(Marketwired - Feb. 5, 2014) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES AND DOES NOT CONSTITUTE AN OFFER OF THE SECURITIES DESCRIBED HEREIN.

VoodooVox Inc. (CSE:VVX) ("VoodooVox" or the "Company") is pleased to announce that it will close on February 6, 2014, a private placement financing (the "Financing") for gross proceeds of approximately $4.9 million as follows:

(i) $4,825,000 through the issuance of an aggregate of 96,500,000 common shares in the capital of the Company (the "Common Shares") at a price of $0.05 per Common Share (the "Issue Price") consisting of the UFM Financing and the Concurrent Offering (as such terms are defined herein); and
(ii) the issuance of a secured debenture for gross proceeds of $100,000 with an annual interest rate of 13.5% (the "Debenture").

The closing of the Financing is subject to complying with the requirements of Policy 6 of the Canadian Stock Exchange ("CSE") which require the Company to file a notice with the CSE in connection with the closing of the Financing one business day prior its closing date, which notice has been filed concurrently with the issuance of this press release.

"With the closing of this financing, VoodooVox is well positioned to move to the next phase of its market opportunity," said George Cooney, CEO of VoodooVox. "Moreover, we are excited to have a secured strategic investment from a leading player in local digital and mobile marketing services with User Friendly Media. We look forward to working together bringing forward innovative solutions to a rapidly growing market."

User Friendly Media ("UFM"), a private media company and a portfolio company of Veronis Suhler Stevenson, upon completion of the Financing will purchase 67,500,000 Common Shares and the Debenture (the "UFM Financing") and Stableview Asset Management Inc. is the lead order in the Concurrent Offering. As a result, upon completion of the Financing, UFM will own approximately 40% of the Company's issued and outstanding Common Shares, and UFM has agreed not to acquire any Common Shares in excess of this amount for a period of one year from the closing date of the UFM Financing, subject to certain limited exceptions.

In connection with the terms of the UFM Financing, the Company will increase the size of its board of directors (the "Board") from four directors to five. Two of the company's current directors have agreed to step down and the two vacancies will be filled by two directors appointed by UFM. A fifth director will be appointed by mutual agreement between the Company and UFM as of closing. In addition, in connection with the UFM Financing, the Company will grant UFM a right of first approach and a participation right in connection with future financings.

VoodooVox believes that this transaction with UFM will align the Company with one of the foremost media companies in the United States and will enable management to execute its strategy in expanding the Company's US mobile advertising network.

VoodooVox intends to use net proceeds from the Financing for general working capital and to significantly expand its sales force and to repay certain short term loans of the Company. The Company recently launched its VVX Local product and successfully completed test campaigns for its performance based mobile advertising services for several national brands. Management believes that the Company's recently launched services have received strong market acceptance and with this financing the Company can now focus more resources on building its sales and marketing efforts.

In addition to the UFM Financing, Trapeze Capital Corp. (the "Agent") acted as the Company's Agent in connection with a brokered financing (the "Concurrent Offering"). Pursuant to the terms of the Concurrent Offering, 29,000,000 Common Shares will be issued at the Issue Price of which 11,500,000 Common Shares will result from the conversion of a short- term note previously issued by the Company. Pursuant to the terms of the Financing, the Agent will be paid an aggregate amount of $392,000 in cash commission and an aggregate 7,845,000 compensation options (the "Options") whereby each Option is exercisable into a Common Share at the Issue Price for a period of two years from the closing date of the Financing.

The Common Shares issued pursuant to the Financing will be subject to a regulatory hold period of four months and one day from the date of the closing of the Financing. The Financing remains subject to final CSE acceptance of requisite regulatory filings.

This news release does not constitute, and the subject matter hereof is not, an offer for sale, or a solicitation of an offer to buy, in the United States or to any "U.S Person" (as such term is defined in Regulation S under the U.S. Securities Act of 1933, as amended (the "1933 Act")) of any equity or other securities of VoodooVox Inc. The securities of VoodooVox Inc. have not been registered under the 1933 Act and may not be offered or sold in the United States (or to a U.S. Person) absent registration under the 1933 Act or an applicable exemption from the registration requirements of the 1933 Act.

About VoodooVox Inc.

VoodooVox is a leader in performance based mobile advertising processing billions of transactions for a marquee list of global clients, agencies, advertisers and publishers. Our full service mobile ad network and campaign management platform drives precision-targeted local and national ad campaigns for brand promotion, brand engagement and lead-generation. Additionally, VoodooVox provides platform services for ad serving, analytics, call tracking, and hyper local campaign targeting to a growing list of mobile ecosystem partners. Visit www.voodoovox.com for more info.

About User Friendly Media

User Friendly Media boasts a portfolio of print, digital and mobile marketing solutions for small business. The company's product suite includes 36 print directories, App Express, a mobile app builder, Huzzah, a cutting-edge digital customer loyalty platform and GoLocal247.com, one of the fastest growing local business directory websites in the country. It's a portfolio company of media industry merchant bank Veronis Suhler Stevenson.

Caution regarding forward-looking information

Certain statements in this news release constitute "forward-looking" statements which relates to future events and the Company's future performance. Forward looking statements include the anticipated use of proceeds, the expansion of the Company's US mobile advertising network, the expansion of the Company's sales force and effect this expansion may have on sales and the receipt of the required approvals for the Financing. Forward-looking statements are based upon the opinions, expectations and estimates of management of the Company and, in some cases, information received from or disseminated by third parties, and are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from those anticipated, expressed or implied by such forward-looking statements.

Although the forward-looking statements contained in this news release are based upon what management of the Company believes are reasonable assumptions on the date of this news release, the Company cannot assure investors that actual results will be consistent with these forward-looking statements. Forward-looking statements involve significant risks and uncertainties, they should not be read as guarantees of future performance or results, and they will not necessarily be accurate indications of whether or not such results will be achieved. Actual results could differ materially from those anticipated due to a number of factors and risks.

The forward-looking statements contained in this press release are made as of the date hereof and the Company disclaims any intention or obligation to update or publicly revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities laws. Furthermore, the Company does not assume responsibility for the accuracy and completeness of the forward looking statements set out in this news release. The Company's forward looking statements are expressly qualified in their entirety by the foregoing cautionary statements.

The CSE has not reviewed, approved or disapproved the content of this press release.

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