VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 05/03/13 -- Digital Shelf Space Corp. (the "Company" or "DSS") (TSX VENTURE: DSS)(OTCQX: DTSRF) is pleased to announce that further to its new releases dated March 21, 2013 and April 19, 2013, the Company has closed the first tranche of its brokered private placement (the "Offering") for total gross proceeds of $1,204,500, comprised of the offering of $728,000 principal amount of convertible debentures (the "Debentures") and 9,530,000 units (the "Units") at a price of $0.05 per unit for Unit subscription proceeds of $476,500.
An aggregate of $200,000 principal amount of Debentures were issued to two private lenders in consideration for the cancellation of short term notes in the aggregate principal amount of $200,000, which short term bridge loan was previously disclosed in the Company's news release on March 21, 2013.
The Debentures are unsecured, have a term to maturity of 36 months, and carry an interest rate of 12% per annum payable in cash on a semi-annual basis. The principal amount of the Debentures are convertible at the holder's option at any time into common shares of the Company at a conversion price of $0.10 per common share. The Company has the right to force the conversion of the Debentures into common shares in the event that the common shares trade at a price of at least $0.20 for a period of at least 15 consecutive trading days. Following the one-year anniversary of issuance, the Company has the right to redeem the Debentures, in whole or in part, at a premium of 5% to the principal value plus any accrued interest.
Each Unit consists of one common share and one common share purchase warrant. Each whole purchase warrant entitles the holder to purchase one common share of the Company at the price of $0.10 per common share on or before the date occurring 18 months following the closing of the Offering.
In the connection with the Offering, the Company paid a cash commission to Fin-XO Securities Inc. ("Fin-XO") equal to 7.5% of the gross proceeds received by the Company from purchasers of the Debentures and Units sold in the Offering. The Company also paid Fin-XO a corporate finance fee of $7,500 plus HST and reimbursed the reasonable expenses and legal fees of Fin-XO. Additionally, the Company has issued to Fin-XO and its agents an aggregate of 714,750 non-transferable broker warrants (the "Broker Warrants") for the purchase of common shares in the Company. The Broker Warrants have an exercise price of $0.10 per common share and expire 18 months following the closing of the Offering.
In accordance with applicable securities legislation, securities issued pursuant to the Offering are subject to a hold period of four months plus one day from the date of completion of the Offering.
Monies raised from the Offering will be used toward marketing and advertising, content development, transaction and related expenses, and working capital and general corporate purposes.
The Offering is subject to final regulatory approval.
About Digital Shelf Space Corp.
Digital Shelf Space is an independent creator, producer and distributor of home entertainment content targeted at the fitness and sports instruction market. Digital Shelf Space's overall content partnership strategy is to align itself with world-class, global brand partners. For more information visit www.digitalshelfspace.com and to view our current projects with Georges St-Pierre and the TOURAcademy®, visit www.gsprushfit.com and www.touracademydvds.com.
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