MONTREAL, April 24, 2013 /CNW Telbec/ - IOU Financial Inc. (CNSX: IOU) ("IOU" or the "Company") announced today an update on its activities.
During the first quarter of this year, IOU announced that it had closed the final tranche of its over-subscribed $5 million private placement of Units comprised of Class B Common Shares and Warrants to purchase Class B Common Shares, for total gross proceeds of approximately $6.1 million. IOU increased the amount to be raised by its private placement in response to investor demand.
During the same quarter, IOU also announced that it had renewed its secured credit facility for a one-year term (subject to the execution of certain closing documents). The credit facility will be increased over three fold to US$10.0 million from the current limit of CDN$3.0 million. The lender will have an option to extend the contract by an additional year provided it increases the credit facility to US$15.0 million.
With these financings in place, IOU will be able to respond to the significant growth in applications it has recently experienced. During the first quarter of this year, IOU processed approximately US$36.6 million in loan applications. This compares to a total of US$49.4 million in all of 2012, and US$17.5 million in all of 2011. Additionally, during the first quarter of this year, IOU originated approximately US$8.7 million in loans. This compares to a total of US$11.5 million in all of 2012 and US$2.4 million in all of 2011.
About IOU Financial
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
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this news release are forward-looking and are subject to numerous risks and uncertainties, known and unknown. For information identifying known risks and uncertainties, relating to liquidity risks, risks inherent in growing a new business, dependence on third-party service providers, credit risks, competition, regulatory risk, and assumptions that could cause the company's actual results to differ from current expectations, please refer to the section "Risks and Uncertainties" of IOU's most recent Management's Discussion and Analysis ("MD&A"), which may be consulted at www.sedar.com. IOU cautions that the foregoing list of factors is not exhaustive. The forward-looking statements presented in the MD&A reflect IOU's expectations as at the date of the MD&A. IOU Financial does not undertake any obligation to update publicly or to revise any such forward-looking statements, unless required by applicable legislation or regulation.
The Canadian National Stock Exchange (CNSX Markets Inc.) has neither approved nor disapproved of the contents of this press release.
SOURCE: IOU FINANCIAL INC.
For further information:
Chief Executive Officer
(514) 789-0694 ext. 225
Chief Financial Officer
(514) 789-0694 ext. 298