Elephant Talk Communications Corp. announced receiving a $500,000 advance, structured in the form of a loan, which, upon completion of due diligence by the potential buyer of ValidSoft Limited, the Company's wholly owned subsidiary, such funds may be applied towards the final purchase price of ValidSoft. In addition to the principal amount of $500,000, the Company may receive an additional $1,500,000 advance from the potential buyer.

In the event ValidSoft Limited is sold to the potential buyer, the aggregate loan of $2,000,000 shall be applied toward the purchase price to be paid. In the event the potential buyer does not fund the additional $1,500,000 by January 25, 2016, the Company shall convert the initial $500,000 received to an unsecured subordinated convertible promissory note, which will be convertible into shares of common stock of the Company at $0.30 per share as well as a five-year warrant to purchase additional common shares of the Company at $0.45, subject to certain exceptions. There is no assurance that the Company will consummate the proposed transaction with the potential buyer for ValidSoft Limited or receive the additional $1,500,000 loan from such buyer.