QYOU Media Completes $7.3 Million Financing and RTO -- Trading Begins Today

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TSXV: QYOU

CALGARY/TORONTO/LOS ANGELES, March 31, 2017 /CNW/ - Galleria Opportunities Ltd. NEX:GOI.H ("Galleria" or the "Company" or the "Resulting Issuer"), is pleased to announce that it has completed its previously announced business combination (the "Transaction") with QYOU Media Inc. ("QYOU") following the completion of a $7.3 million brokered and non-brokered financing with Dominick Inc. ("Dominick"), as lead agent. The Resulting Issuer has adopted the name "QYOU Media Inc.". QYOU is pleased to announce that the TSX Venture Exchange (the "TSXV") has granted final approval of Galleria's application for its reactivation and graduation as QYOU from NEX to Tier 2 of the TSXV. Common shares of QYOU commenced trading on the TSXV under its new symbol "QYOU" today. QYOU is a pioneer and industry leader in the curation, licensing and programming of short-form web-based video content for the TV Everywhere age. The Corporation delivers linear and on-demand TV channels, playlist-driven mobile apps, custom shows, and influencer marketing support to TV operators, mobile carriers and subscription video service providers worldwide.

Pursuant to the Transaction, each issued and outstanding common share of QYOU (each, a "QYOU Common Share") was exchanged for 0.92 of a post-Consolidation (as defined below) common share of the Corporation (each, a "Resulting Issuer Share") with a deemed value of $0.50 per share. As a result, 52,412,836 QYOU Common Shares were exchanged for 48,219,809 Resulting Issuer Shares. The Resulting Issuer Shares exchanged for each of the QYOU Common Shares outstanding are subject to contractual resale restrictions such that only 10% thereof may be sold after 45 days from the date the Resulting Issuer Shares commence trading (the "Listing Date") on the TSXV, and additional amounts of 30% may be released after 6, 12 and 18 months, respectively, after the Listing Date, subject to earlier releases (subject to regulatory approval) as the Resulting Issuer and Dominick may determine. The other securities of QYOU were exchanged on a one for one basis such that: (i) 14,082,294 existing common share purchase warrants of QYOU were exchanged for 14,082,294 post-Consolidation common share purchase warrants of the Corporation at an average exercise price of $0.75 per share; and (ii) 1,182,190 compensation options of QYOU were exchanged for 1,182,190 post-Consolidation compensation options of the Corporation at an average exercise price of $0.50 per share. In connection with the Transaction, Galleria consolidated its common shares on a two-old-for-one-new basis (to 3,089,150 common shares) before giving effect to the aforementioned Transaction.  The Corporation was continued as an Ontario corporation.

In addition, in connection with the Transaction, Dominick acted as lead agent on its own behalf and on behalf of a syndicate of agents (collectively with Dominick, the "Agents") and completed: (a) a private placement of 8,632,000 subscription units of QYOU (the "Subscription Units") at a price of $0.50 per Subscription Unit for gross proceeds of $4,316,000 (the "Brokered QYOU Offering"); and (b) a private placement of 3,869,000 units of the Galleria (the "Resulting Issuer Units") at a price of $0.50 per Resulting Issuer Unit, each Resulting Issuer Unit comprised of one Resulting Issuer Share and one-half of one Resulting Issuer Share purchase warrant (each whole warrant, a "Resulting Issuer Warrant"), exercisable at $0.75 per share until March 10, 2019, for gross proceeds of $1,934,500 completed through the use of an Exchange Short Form Offering Document (the "Galleria Offering"), together with an additional 2,130,000 Subscription Units sold directly by QYOU on a non-brokered basis (the "Non-Brokered QYOU Offering", and together with the Brokered QYOU Offering and the Galleria Offering, the "Offerings"). In aggregate, 14,631,000 Resulting Issuer Units and Subscription Units were sold for total gross proceeds of $7,315,500.

Upon satisfaction of a number of escrow release conditions, the Subscription Units were automatically exchanged for units of QYOU (the "QYOU Units") immediately prior to the completion of the Transaction, with each QYOU Unit being comprised of one QYOU Class A Common Share (the "QYOU Class A Shares") and one-half of one QYOU Class A Share purchase warrant (each whole warrant, a "QYOU Warrant"). The QYOU Class A Common Shares are identical in all respects to the QYOU Common Shares but are exchangeable on a one for one basis into Resulting Issuer Shares.  Each QYOU Warrant entitles the holder thereof to subscribe for one additional QYOU Class A Share (each, a "QYOU Warrant Share") at an exercise price of $0.75 per QYOU Warrant Share at any time until March 10, 2019. The QYOU Class A Shares were exchanged for Resulting Issuer Shares on the basis of one QYOU Class A Share for each Resulting Issuer Share, and the QYOU Warrants were exchanged for Resulting Issuer Warrants on the basis of one QYOU Warrant for each Resulting Issuer Warrant, upon completion of the Transaction. Upon listing of QYOU, 13,385,483 common shares held by QYOU Media founders, 6,743,775 common shares held by certain non-principal shareholders and 660,082 warrants acquired pursuant to a financing transaction in 2015 held by two insiders will be subject to Tier 2 value escrow requirements of the TSXV (collectively, the "Escrowed Securities"). The Tier 2 value escrow release provisions provide for the release of the Escrowed Securities over 36 months, with 10% of the Escrowed Securities released on the date of the final exchange bulletin, and 15% of the balance of the Escrowed Securities released every 6 months thereafter.

In connection with the Offerings, the Agents were paid a cash commission equal to 7.5% of the gross proceeds of the Brokered QYOU Offering and the Galleria Offering, and 1% of the gross proceeds of the Non-Brokered QYOU Offering.

The Agents were also issued compensation options (the "QYOU Compensation Options") equal to 7.5% of the number of Subscription Units sold under the Brokered QYOU Offering and 1% of the number of Subscription Units sold under the Non-Brokered QYOU Offering, and compensation options (the "Resulting Issuer Compensation Options") equal to 7.5% of the number of Resulting Issuer Units sold under the Galleria Offering. In connection with the Transaction, the QYOU Compensation Options were exchanged for Resulting Issuer Compensation Options on the basis of one QYOU Compensation Option for each Resulting Issuer Compensation Option. Each Resulting Issuer Compensation Option entitles the holder thereof to subscribe for one Resulting Issuer Unit at a price of $0.50 per Resulting Issuer Unit at any time until March 31, 2019. Each whole common share purchase warrant underlying the Resulting Issuer Units entitles the holder thereof to subscribe for one Resulting Issuer Share at a price of $0.75 per share until March 31, 2019.

The proceeds of the Offerings will be used to fund the Resulting Issuer (QYOU's) working capital and for general corporate purposes.  

Chairman G. Scott Paterson said: "We are delighted to welcome so many high quality shareholders to the QYOU Media family and are very excited about the next chapter for the Company as a public company."

The Corporation also announces the grant of stock options to acquire an aggregate of 6,446,496 Resulting Issuer Shares, subject to the execution of definitive option agreements, to directors, officers, consultants and employees of the Corporation.

Each grant of options has a five-year term. The options are subject to vesting which vary depending upon the recipients role in the organization. Each option is exercisable into one Resulting Issuer Share at an exercise price of $0.50 per share.

About QYOU Media Inc.

QYOU Media curates, licenses and programs the best of short form internet video for the benefit of video content providers worldwide including traditional cable and satellite to IPTV, over-the-top content (OTT) and mobile carriers. QYOU's carriage partners offer the channel on a linear, mobile, broadband and VOD basis.

QYOU Media was founded and created by industry veterans Scott Ehrlich, Curt Marvis, Les Garland and G. Scott Paterson, all of whom have extensive histories in both traditional and digital media.

Investors are cautioned that, except as disclosed in the Filing Statement dated February 22, 2017 prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon.  Trading in the securities of the Corporation should be considered highly speculative.

Neither the Exchange nor its Regulation Service Provider (as that term is defined in the policies of the Exchange) has in any way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

Except for historical information contained herein, this news release contains forward-looking statements that involve risks and uncertainties including, but not limited to, the anticipated use of proceeds of the Offerings, the receipt of final Exchange approval of the Transaction, and the resumption of trading of the Resulting Issuer Shares. Actual results may differ materially. The Corporation will not update these forward-looking statements to reflect events or circumstances after the date hereof, except as may be required by applicable securities law. More detailed information about potential factors that could affect financial results is included in the documents filed from time to time with the Canadian securities regulatory authorities by the Corporation.

This 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.

SOURCE QYOU Media Inc.

For further information: G. Scott Paterson, Chairman QYOU Media Inc., (647) 559-2700; Curt Marvis, Co-CEO, QYOU Media Inc., (310) 869-8617


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