MediaValet Announces Brokered Private Placement, Offer to Settle Convertible Debentures, and Share Consolidation

/NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH UNITED STATES NEWSWIRE SERVICES/

VANCOUVER, Aug. 21, 2019 /CNW/ - MediaValet Inc. (TSX-V: MVP) (the "Company" or "MediaValet"), is pleased to announce the launch of a brokered private placement to raise $3.5 million (the "Offering"). The Offering is being led by Cormark Securities Inc. (the "Agent") on a best efforts basis. The Company has also entered into an agreement (the "Board Rights Agreement") with Shen Capital Corporation ("Shen Capital"), pursuant to which the Company will appoint a representative of Shen Capital to the Board of Directors of the Company on closing of the Offering. Concurrently with the Offering, the Company will offer to settle its outstanding convertible debentures and associated warrants for units having the same terms and conditions as those issued pursuant to the Offering. The Offering is conditional on the Company completing a 15:1 consolidation of its outstanding shares.

The Offering

The Offering will consist of up to 6,666,666 units (the "Units") comprised of one post-consolidation common share of the Company and a common share purchase warrant entitling the holder to purchase a further post consolidation common share of the Company (the "Warrants"). The Units are being sold at a post consolidation price of $0.525 per Unit. The Warrants will be exercisable for a period of 36 months from closing, at a price of $0.90 per post consolidation share.

The Warrants are subject to accelerated expiry in the event the daily volume weighted average trading price of the Common Shares equals or exceeds $1.50 for 10 consecutive trading days (an "Acceleration Event"), in which case, the Company may accelerate the expiry date of the warrants to a date that is not less 60 days after the issuance of a press release announcing that the expiry date of the Warrants has been accelerated, provided that such news release is issued within 10 business days of the Acceleration Event. The Company will also give written notice to the holders of Warrants not less than 30 days before the new expiry of the Warrants.

In connection with the Offering the Company will pay the Agent a cash commission and will issue to the Agent warrants to purchase common shares of the Company, exercisable for three years from closing at a price of $0.90 per share.

The Company intends to use the net proceeds of the Offering to provide the working capital required to fund its current growth objectives and to continue executing on its strategic plan. Closing of the Offering is expected to occur on or about September 5, 2019.

Board Rights Agreement

Shen Capital has agreed to participate in the Offering and subscribe, either directly or in combination with its affiliates, for $1.5 million of Units. In connection with Shen Capital's subscription, the Company has entered into the Board Rights Agreement. Pursuant to the Board Rights Agreement, the Company has agreed with Shen Capital to, amongst other things: (i) appoint Francis Shen to the Board of Directors, to hold office until the next annual meeting of the Company, at which Mr. Shen may be nominated for re-election; and (ii) appoint Andrew Shen as a board observer, which appointment will be effective for up to three years. The appointments are subject to completion of the Offering.

Offer to Settle Outstanding Convertible Debentures

Concurrently with the Offering, the Company intends to offer to the holders of its 10% convertible debentures which mature March 21, 2022 (the "Debentures") the opportunity to settle their outstanding debentures and associated common share purchase warrants (the "Debenture Warrants") in exchange for Units (the "Exchange Offer") at the rate of one Unit for each $0.525 principal amount of the Debenture's settled pursuant to the Exchange Offer. The Exchange Offer will be open for acceptance by the holders of the Debentures until the close of business on September 16, 2019.

The Debentures and Debenture Warrants were issued on March 20 2019. The Debentures are convertible into common shares at the rate of one common share for each $0.05 principal amount outstanding during the first 12 months following their issue, and thereafter at one common share for each $0.10 principal amount outstanding. The holders of the Debentures also received one Debenture Warrant for each $0.05 principal amount of the Debenture acquired. Each Debenture Warrant entitles the holder to purchase one common share of the Company at a price of $0.05 per share for a period expiring March 20, 2022. Currently, a total of $1,550,762 principal amount of Debentures and 31,015,240 Debenture Warrants are outstanding.

In order to accept the offer, holders of the Debentures will be required to surrender their Debenture together with all associated Debenture Warrants for cancellation. In exchange, they will receive Units having the same terms and conditions as the Units issued in the Offering. The Exchange Offer is not subject to any minimum subscription level, and may or may not be accepted by any or all of the holders of the Debenture. If all of the holders of the Debentures accept the Exchange Offer, the Company would issue an additional 2,953,833 Units. The Offering is not subject to any minimum acceptance of the Exchange Offer. Insiders of the Company and their affiliates hold approximately $1,050,000 principal amount of the Debentures.

Share Consolidation

The Offering and the Exchange Offer are conditional on the completion of a 15:1 share consolidation by the Company. Accordingly, the Board of Directors has approved the completion, immediately prior to the closing of the Offering, of a share consolidation on a 15 old to one new basis. Currently, the Company has 230,895,122 common shares outstanding. Upon completion of the consolidation, the Company will have approximately 15,393,008 common shares outstanding (prior to the closing of the Offering and the Exchange Offer). The consolidation is being completed as a condition to the closing of the Offering. The consolidation was approved by the shareholders of the Company at the Company's annual meeting held on June 25, 2019. The Company will continue to trade after the consolidation under the name "MediaValet Inc.".

The Offering, the Exchange Offer, and the consolidation, are each subject to the approval of the TSX Venture Exchange.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities to be issued pursuant to the Offering and the Exchange Offer have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or under any state securities laws and may not be offered or sold within the United States or to U.S. persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

About MediaValet Inc.

MediaValet stands at the forefront of the enterprise, cloud?based, digital asset management industry. Built exclusively on Microsoft Azure and available within 140 countries, across 54 Microsoft data center regions around the world, MediaValet delivers unparalleled enterprise class security, reliability, redundancy and scalability while offering the largest global footprint of any DAM solution. In addition to providing all core DAM capabilities and local desktop?to?sever?to?cloud support for creative teams, MediaValet offers industry leading integrations with Slack, Adobe Creative Suite, Microsoft Office 365, Oracle Marketing Cloud (Eloqua), Wrike, Drupal 8, WordPress, Hootsuite and many other best?in?class 3rd party applications.

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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.

This news release contains forward?looking information that involve various risks and uncertainties regarding future events. Such forward?looking information can include without limitation statements based on current expectations involving a number of risks and uncertainties and are not guarantees of future performance of the Company, such as statements that the Company intends to (i) undertake the Offering and the anticipated use of proceeds of the Offering, (ii) appoint an additional director and a board observer; (iii) make the Exchange Offer; and (iv) complete the Consolidation. There are numerous risks and uncertainties that could cause actual results and the Company's plans and objectives to differ materially from those expressed in the forward?looking information, including: (i) adverse market conditions; (ii) the inability of the Company to complete the Offering at all or on the terms announced for whatever reason, including counterparty risks in completing necessary private placement documentation; (iii) that any of the debenture holders accept the Exchange Offer; (v) the proceeds of the Offering will be used in the discretion of management and may be, for valid business reasons, be spent differently than as set out in this news release; and (vi) the TSX Venture Exchange not approving the Offering, the Exchange Offer, the director nominees or the Consolidation, any one of which could affect the other. Actual results and future events could differ materially from those anticipated in such information. These and all subsequent written and oral forward?looking information are based on estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Except as required by law, the Company does not intend to update these forward?looking statements

SOURCE MediaValet Inc.