EXO U Announces Closing of Equity Private Placement

/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

MONTREAL, Feb. 26, 2016 /CNW Telbec/ - EXO U Inc. ("EXO U" or the "Corporation") (TSXV: EXO) is pleased to announce today the closing of its previously announced non-brokered private placement of 20,000,000 units (the "Units") at a price of CAD$0.10 per Unit for aggregate gross proceeds to the Corporation of CAD$2,000,000 (the "Private Placement").

The Corporation is also pleased to announce, due to investor demand, the closing of an additional non-brokered private placement offering of 2,500,000 Units at a price of CAD$0.12 per Unit for aggregate gross proceeds to the Corporation of CAD$300,000 (the "Additional Private Placement" and, together with the Private Placement, the "Offering"). Closing of the Offering remains subject to the final approval of the TSX Venture Exchange ("TSXV").

Each Unit consists of one (1) common share (each, a "Common Share") in the capital of the Corporation and one (1) common share purchase warrant (each, a "Warrant"). Each Warrant issued pursuant to the Private Placement and the Additional Private Placement shall entitle the holder thereof to acquire one Common Share at a price of CAD$0.15 and CAD$0.16, respectively, for a period of twenty-four (24) months from the closing date of the Offering (the "Expiration Date"). All securities issuable pursuant to the Offering will be subject to a four-month hold period from the date of issuance. The Warrants will be subject to an accelerated expiry (the "Accelerated Expiry") if, at any time after the four-month hold period expires, the 20 trailing-day volume weighted average price of the Common Shares on the TSXV exceeds CAD$0.30, in which event the holder will be given notice that the Warrants will expire 30 days following the date of such notice. The Warrants will be exercisable by the holder during the 30-day period between the notice and the expiration of the Warrants.

As part of the Offering, Hypertechnologie Ciara Inc. ("Hypertec"), an existing "Control Person" of the Corporation, Sean Maniaci, a director of the Corporation and Kevin Pawsey, the Chief Executive Officer and a director of the Corporation, have purchased 4,766,667 Units, 85,000 Units and 83,333 Units, respectively. The participation in the Offering by Hypertec and Messrs. Maniaci and Pawsey constitutes a related party transaction under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("61-101"). The Corporation is relying on exemptions from the formal valuation requirement and the minority approval requirement under 61-101 as neither the fair market value of the Units to be issued to Hypertec and Messrs. Maniaci and Pawsey, nor their investments, will exceed 25% of the Corporation's market capitalization. The Corporation did not file a material change report more than 21 days before the closing of the Offering as the details of these parties' participation in the Offering were not settled until shortly prior to the closing of the Offering.

As previously disclosed on February 10, 2016, the net proceeds of the Offering is intended to be used by the Corporation for general corporate and working capital purposes. In particular, the Corporation intends to use the net proceeds to execute on the plan previously detailed in the February 3, 2016 update.

In connection with the Offering, the Corporation has agreed to pay a finder's fee to certain arm's length parties which includes an aggregate payment in cash in the amount of CAD$58,099 and the issuance of 566,644 compensation warrants ("Compensation Warrants"), with each Compensation Warrant issued pursuant to the Private Placement and the Additional Private Placement entitling the holder thereof to purchase one Common Share at an exercise price of CAD$0.15 and CAD$0.16, respectively, prior to the Expiration Date. The Compensation Warrants will also be subject to the Accelerated Expiry. In addition, the Corporation also agreed to pay an amount equal to USD$50,000 to a separate arm's length party as consideration for the introduction by it to the Corporation of certain purchasers in the Offering and its assistance to the Corporation for investor and management presentations.

The 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, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or 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 EXO U

EXO U's shares trade on the TSX Venture Exchange under the ticker symbol EXO. EXO U develops an innovative software platform that enables businesses and educational institutions to securely mobilize and manage their mobile workforce and students by delivering engaging experiences spanning desktop and mobile applications. At the core of EXO U's platform is the smart and agnostic EXO engine that unifies multiple software platforms, allowing devices to interact and communicate seamlessly together. For more information, visit EXOU.com or follow us on Twitter @exo_u.

Disclaimer in Regards to Forward-Looking Statements

Certain statements made in this press release that are not historical facts, including but not limited to statements with respect to the use of the net proceeds, are forward-looking statements and are subject to important risks, uncertainties and assumptions. The results or events predicted in these forward-looking statements may differ materially from actual results or events. As a result, readers are cautioned not to place undue reliance on these forward-looking statements. The forward-looking information contained in this press release represents EXO U's current expectations. EXO U disclaims any intention and assumes no obligation to update or revise any forward-looking information, except if required by applicable securities laws. For additional information with respect to certain of these and other assumptions and risk factors, please refer to EXO U's management's discussion and analysis for the year ended March 31, 2015, available under the Company's profile on SEDAR at www.sedar.com.  

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.

For more information please visit www.exou.com.

SOURCE EXO U Inc

Investor contacts: Kevin Pawsey, Chief Executive Officer, EXO U Inc., [phone], [email protected]; Shan Ahdoot, President, EXO U Inc., [phone], [email protected]; Media contacts: Ian Bryan, Vice President, Marketing, EXO U Inc., [phone], [email protected]