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.
ON BEHALF OF THE BOARD
Jeffrey Sharpe, President & CEO
Forward Looking Statements
This news release contains "forward-looking information" within the meaning of the Canadian securities laws. Forward-looking information is generally identifiable by use of the words "believes," "may," "plans," "will," "anticipates," "intends," "budgets", "could", "estimates", "expects", "forecasts", "projects" and similar expressions, and the negative of such expressions. Forward-looking information in this news release include statements about the ongoing intention to complete a private placement offering and the use of proceeds received from the closing of the first tranche of the private placement offering.
In connection with the forward-looking information contained in this news release, Digital Shelf Space has made numerous assumptions, regarding, among other things, expected investor interest of the ongoing private placement offering. While Digital Shelf Space considers these assumptions to be reasonable, these assumptions are inherently subject to significant uncertainties and contingencies.
Additionally, there are known and unknown risk factors which could cause Digital Shelf Space's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information contained herein. Known risk factors include, among others: Digital Shelf Space may not be able to complete the closing of any further tranches of the private placement offering on the terms currently contemplated, or at all; Digital Shelf Space may not use funds received from the closing of the first tranche of the private placement as currently contemplated; reliance on the health and marketability of celebrity fitness talent in productions owned by Digital Shelf Space; actual results from the use of celebrity fitness products may differ substantially from anticipated results; the substantial investment of capital required to produce and market video and entertainment productions, limitations imposed by our financing abilities, unpredictability of the commercial success of our programming, difficulties in integrating technological changes and other trends affecting the entertainment industry.
A more complete discussion of the risks and uncertainties facing Digital Shelf Space is disclosed in Digital Shelf Space's Filing Statement dated November 16, 2010 and continuous disclosure filings with Canadian securities regulatory authorities at www.sedar.com. All forward-looking information herein is qualified in its entirety by this cautionary statement, and Digital Shelf Space disclaims any obligation to revise or update any such forward-looking information or to publicly announce the result of any revisions to any of the forward-looking information contained herein to reflect future results, events or developments, except as required by law.
Neither 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 the release.
Digital Shelf Space Corp.
President and CEO
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