Cricket Media Closes First Tranche of Bridge Financing

/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

WASHINGTON, DC, May 13, 2015 /CNW/ - Cricket Media Group Ltd. (TSXV:CKT) ("Cricket Media" or the "Company") announces that it has closed the first tranche of its previously announced bridge financing (the "Bridge Loan") and issued secured convertible debentures in the principal amount of US$2,526,000 (the "Senior Bridge Debentures") and a secured convertible debenture in the principal amount of US$50,000 (the "Junior Bridge Debenture").  Under this first tranche, US$1,576,000 of the Senior Bridge Debentures were issued for cash and US$950,000 of the Senior Bridge Debentures and the Junior Bridge Debenture were issued in settlement of an equal amount outstanding under the revolving line of credit of Cricket Media, Inc., a wholly-owned subsidiary of the Company. The Senior Bridge Debentures form part of the senior tranche of the Bridge Loan as described in the Company's news release dated April 6, 2015 and rank senior to the Company's 6.5% secured convertible debentures in the aggregate principal amount of C$11,999,000 (the "Junior Indebtedness") issued pursuant to a trust indenture dated October 19, 2012 and the Company's 10% secured convertible debentures in the aggregate principal amount of C$10,000,000 issued pursuant to a trust indenture dated March 20, 2013 (the "Senior Indebtedness"). The Junior Bridge Debenture forms part of the junior tranche of the Bridge Loan and ranks junior to the Junior Indebtedness and the Senior Indebtedness.

The Bridge Loan will mature on April 30, 2016 and bears interest at a rate of 5% per annum.  The Company has the option to pay accrued interest in cash, or by issuing the lenders under the Bridge Loan voting common shares or restricted voting common shares at a price equal to the market price at the time of settlement.  The Senior Bridge Debentures and the Junior Bridge Debenture are convertible into voting common shares or restricted voting common shares of the Company at the option of the holder, at a conversion price of US$0.32 per share.  In the event that the Company raises aggregate gross proceeds of a minimum of US$10 million pursuant to an equity financing of preferred shares (the "Financing") and the Bridge Loan, collectively, all outstanding indebtedness under the Bridge Loan will convert into, at the option of the holder: (A) preferred shares at a conversion price equal to the greater of: (i) 80% of the issue price per share under the Financing; and (ii) US$0.32; or (B) voting common shares or restricted voting common shares at a price of US$0.32 per share, or a combination of (A) and (B) at the holder's option.

As a result of the closing of a portion of the senior tranche of the Bridge Loan, an amount of Senior Indebtedness held by insiders of the Company equal to the Canadian dollar equivalent of the principal amount of the Senior Bridge Debentures issued pursuant to this first tranche of the Bridge Loan ranks subordinate to the Junior Indebtedness and the balance of the Senior Indebtedness.

The Company is proceeding with the debt restructuring as described in its news release dated April 6, 2015 (the "Debt Restructuring").  As part of the amendments to the trust indentures in respect of the Junior Indebtedness and Senior Indebtedness to permit the Bridge Loan, the requisite holders of Junior Indebtedness and Senior Indebtedness agreed that the interest payment due thereunder on April 30, 2015 shall not be paid and shall form principal obligations of the Company under the new senior indebtedness that consolidates the Junior Indebtedness and Senior Indebtedness as part of the Debt Restructuring.

Certain of the transactions described in this news release constitute "related party transactions" within the meaning of Multilateral Instrument 61-101 Protection of Minority Shareholders in Special Transactions ("MI 61-101").  For these transactions the Company is relying on the exemption from the formal valuation requirements of MI 61-101 contained in section 5.5(b) of MI 61-101 on the basis that no securities of the Company are listed on a specified market set out in such section and the Company is relying on the exemption from the minority shareholder approval requirements of MI 61-101 contained in Section 5.7(1)(e) of MI 61-101 on the basis of meeting the financial hardship exemption requirements.

About Cricket Media

Cricket Media (TSXV: CKT) is an education media company that provides award-winning content on a safe and secure learning network for children, families and teachers across the world. Cricket Media's 14 popular media brands for toddlers to teens include Babybug, Ladybug, Cricket® and Cobblestone® with multiple language editions and apps in English, Spanish and Chinese. The Company's innovative web-based K12 tools for school and home include the ePals community and virtual classroom for global collaboration as well as In2Books®, a Common Core eMentoring program that builds reading, writing and critical thinking skills. Cricket Media serves approximately one million classrooms and millions of teachers, students and parents in over 200 countries and territories through its platform and NeuPals, its joint venture with China's leading IT services company Neusoft. Cricket Media also licenses its content and platform to top publishing and educational companies worldwide. For more information, please visit www.Cricketmag.com, www.ePals.com and www.In2Books.com.

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.

Forward Looking Statements

This news release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by the Company and described in the forward-looking statements contained in this press release. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do so, what benefits the Company will derive therefrom. The forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

SOURCE Cricket Media Inc.

Aric Holsinger, Chief Financial Officer, Cricket Media, Phone: [phone], [email protected]; Cory Pala, Investor Relations, Phone: [phone], [email protected]