IOU Financial announces that it has entered into a new agreement to sell loans to the Palos/IOU High Yield Fund, a fund managed by Palos Management Inc.

MONTREAL, April 25, 2014 /CNW Telbec/ - IOU Financial Inc. ("IOU Financial") (TSXV: IOU) is pleased to announce that it has entered into a new agreement with Palos Management Inc. and the Palos/IOU High Yield Fund (the "Fund"), a fund managed by Palos Management Inc., whereby its wholly-owned US subsidiary, IOU Central Inc., will have the opportunity, but not the obligation, to sell to the Fund, and the Fund will have the opportunity, but not the obligation, to purchase, up to US$250 million aggregate principal amount of loans originated, over the course of the sixty month period following the date on which this transaction receives the approval by IOU Financial's disinterested shareholders. Disinterested shareholders will be asked to vote on a resolution to approve such transaction at the Corporation's Annual General Meeting of Shareholders to be held on May 23, 2014 or at any any adjournment or postponement thereof.

This transaction may be considered a related party transaction within the meaning of Regulation 61-101 respecting Protection of Minority Security Holders in Special Transactions ("61-101") since Philippe Marleau, Chief Executive Officer and a director of IOU Financial, is a shareholder in a company that has control over more than 10% of IOU Financial's common shares and which controls, indirectly, or is under the influence of, Palos Management Inc. However, this transaction is exempt from the valuation requirement provided under such regulation since IOU Financial, as a TSX Venture Exchange-listed issuer, is not listed on "specified markets", as defined under 61-101.

The Board of Directors of IOU Financial has unanimously approved the transaction. Philippe Marleau declared his interest prior to the approval by the Board of Directors of IOU Financial and abstained from voting thereon.

About IOU Financial Inc.

IOU Financial, via its U.S. subsidiary, IOU Central, provides small businesses throughout the U.S. access to the capital they need to seize growth opportunities quickly. Typical customers include medical and dental practices, grocery and retail stores, restaurant and hotel franchisees and e-commerce companies. In a unique approach to lending, IOU Central's advanced, automated application and approval system accurately assesses applicants' financial realities, with an emphasis on day-to-day cash flow trends. It makes loans of up to $100,000 to qualified applicants within a few business days, with affordable charges favorable to cash-flow management. IOU Central's speed and transparency make it a trusted alternative to banks. To learn more visit: www.ioucentral.com.

Forward Looking Statements

Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of IOU including, but not limited to, the impact of general economic conditions, industry conditions, dependence upon regulatory and shareholder approvals, the execution of definitive documentation and the uncertainty of obtaining additional financing. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. IOU does not assume any obligation to update or revise its forward-looking statements, whether as a result of new information, future events, or otherwise.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE IOU FINANCIAL INC.

For further information:

Philippe Marleau
Chief Executive Officer
(514) 789-0694 ext. 225

Mayco Quiroz
Chief Financial Officer
(514) 789-0694 ext. 298