EXO U Announces Closing of First Tranche of Equity Private Placement and Management Change

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MONTREAL, Oct. 23, 2015 /CNW Telbec/ - EXO U Inc. ("EXO U" or the "Corporation") (TSX Venture: EXO) is pleased to announce the first closing of its previously announced private placement offering of up to 20,000,000 units of EXO U (the "Units") at a price of $0.20 per Unit (the "Offering"). The Corporation sold a total of 12,223,750 Units, for aggregate gross proceeds to the Corporation of $2,444,750.

Each Unit consists of one common share (each a "Common Share") in the capital of the Corporation and one common share purchase warrant (each, a "Warrant"). Each Warrant shall entitle the holder thereof to purchase one Common Share (a "Warrant Share") at a price of $0.35 at any time before 5:00 p.m. (Toronto time) on the date that is 24 months following the date on which the Warrant was issued, subject to adjustment in certain events.

In consideration for its services, Mackie Research Capital Corporation (the "Agent") received a cash commission (the "Commission") equal to 6% of the gross proceeds of the brokered portion of the Offering. The Agent also received 607,300 non-transferable warrants (the "Broker Warrants"). Each Broker Warrant has the same term as the Warrants and an exercise price of $0.20. 

As part of the Offering, Shan Ahdoot, the President and Chief Executive Officer of the Corporation and an insider of the Corporation, purchased 1,250,000 Units on a non-brokered basis. His participation in the Offering constitutes a "related party transaction" as defined in Multilateral Instrument 61-101 ("MI 61-101") and Policy 5.9 of the TSX Venture Exchange. This transaction is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101, as neither the fair market value of the securities issued to, nor the consideration paid by Mr. Ahdoot, exceeds 25% of the Corporation's market capitalization. No commission or Broker Warrants were paid to the Agent in connection with Mr. Ahdoot's participation.

The Corporation did not file a material change report more than 21 days before the closing of the Offering as the details of the participation therein by related parties of the Corporation were not settled until shortly prior to the closing of the Offering.

EXO U intends to use the net proceeds of the Offering for general corporate and working capital purposes. All securities issued pursuant to the Offering are subject to a statutory hold period which expires on February 24, 2016. The Corporation will be working to complete a second tranche of the Offering in the coming weeks. The Offering is subject to the final approval of the TSX Venture Exchange.

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, or for the account or benefit of, U.S. persons (as defined in Regulation S under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Management Change

EXO U also announced today that Kevin Pawsey has been appointed as the Chief Executive Officer of the Corporation. Mr. Pawsey joined the organization in August 2015 as Chief Operating Officer. Mr. Pawsey will also join the board of directors of the Corporation (the "Board of Directors"). Mr. Pawsey will succeed Mr. Shan Ahdoot, who will resign from the Chief Executive Officer position but will continue to serve as President and Chairman of the Board of Directors.

Mr. Pawsey is a three-time CEO in the education sector. He brings over twenty years of experience to EXO U and has a proven history of success in developing sustained business growth internationally in the fields of education, technology, and online learning.

"I, and the board of directors of EXO U, are extremely pleased with Kevin assuming the role of CEO of the Corporation", said Shan Ahdoot. "Kevin has a proven track record in building early-stage digital technology businesses and his strong sales and marketing experience will serve us well as we accelerate EXO U's growth."

Mr. Pawsey stated "I am very pleased to be able to take on the role of CEO for EXO U to focus on taking Version 4.0 of the EXO U Platform to known markets where there is a real push to mobile, 1:1, and Bring your Own Device Initiatives. The EXO U Platform gives education technology businesses, publishers, and their respective customers a strong platform enabling teachers to do what they do best and to deliver teaching and learning using technology that compliments existing teaching practices. I look forward to developing the team and building additional partnerships and contracts around the EXO U Platform; recent wins have provided us with additional market feedback that will help accelerate the business plan to target identifiable funding streams."

In connection with Mr. Pawsey's appointment to this new role, the Board of Directors has granted Mr. Pawsey 100,000 options pursuant to the Corporation's stock option plan. The options are exercisable at a price of $0.235 per common share of the Corporation for a period of 10 years following the date of grant and will vest at a rate of 25% after one calendar year following the date of grant, with the balance of 1/36 vesting each month over the subsequent 36 months.

About EXO U

EXO U's shares trade on the TSX Venture Exchange under the ticker symbol EXO.V.  EXO U develops an innovative software platform which 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. It enables true mobility for businesses and educational organizations by solving important mobility issues such as security, privacy, collaboration, and management of application and content. EXO U's technology agnostic framework delivers to end users a safe, reliable, and intuitive smart workspace designed for connecting with people, accessing services, and sharing information and digital content, while requiring minimal infrastructure and optional Internet connectivity. It simplifies management of the entire application lifecycle, freeing the organizations to focus on building engaging apps that work across different operating systems and form factors, thus increasing productivity for developers and reducing total cost of  ownership for organizations. By offering an engaging and exceptional user experience on all computing devices, without compromising security or protected information, the EXO U enterprise and education solutions allow organizations to embrace consumerization and enjoy all the benefits of mobile. For more information, visit http://www.exou.com  and 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 completion of a second tranche of the Offering and the use of the net proceeds thereof, 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.

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

For investor inquiries, please contact: Mr. Kevin Pawsey, Chief Executive Officer, EXO U Inc., Phone: [phone], E-mail: [email protected]; Mr. Doug McCollam, Chief Financial Officer, EXO U Inc., Phone: [phone], E-mail: [email protected]