SilverBirch Closes Equity Financing; Acquires New Directors as Company Sharpens Focus on Growth and Profitability



    
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    Three new board members bring wealth of experience in finance, marketing
    and corporate governance, plus extensive contacts in digital media and
    gaming
    

    TORONTO, Oct. 17 /CNW/ - SilverBirch Inc. (TSX-V: SVB), a leading digital
media company, today announced it has closed its oversubscribed non-brokered
private placement of units, placed by Aberdeen Gould Capital Markets Ltd., for
gross proceeds of $530,600 as previously announced in press releases dated
October 6 and October 14, 2008. The Company is also pleased to announce the
appointment of three corporate leaders, with extensive experience in digital
media and gaming, to the company's board of directors.
    Effective immediately, Mr. Terence M. Donnelly, Executive Vice President,
Chief Information Officer and Chief Privacy Officer of Mandrake Management
Consultants Corp., joins the SilverBirch board as Chairman. He is joined by
Mr. Jeffrey Friedman, C.O.O., Edgemere Capital, and Mr. Kevin Astle, Managing
Principal, Marketing Imperatives International, who have been appointed as
directors.
    Their appointments follow the resignation of three previous directors,
Mr. Brian Courtney, Mr. David Lucatch and Mr. Michael O'Farrell, who
contributed significantly to SilverBirch during the company's early stage
corporate development initiatives and provided public markets guidance.
    "I would like to express my sincere gratitude to Mr. Brian Courtney,
Mr. David Lucatch and Mr. Michael O'Farrell for helping steer SilverBirch to
its current position as a leading player in the digital media industry," said
Derek van der Plaat, CEO of SilverBirch. "I welcome our new board members, and
look forward to leveraging their experience as we integrate recent
acquisitions, develop new products, and advance our company on the path to
profitability and further growth."
    Mr. Terence Donnelly, Mr. Jeffrey Friedman and Mr. Kevin Astle together
bring years of executive-level experience in finance, marketing and corporate
governance to the SilverBirch board. They also deliver extensive knowledge and
contacts in digital media and gaming that are directly applicable to the
business.
    Mr. Donnelly is the Executive Vice President, C.I.O. and C.P.O. of
Mandrake Management Consultants Corp., the largest privately held executive
search firm in Canada. He has founded and led their successful
technology-focused practice, secured tier one clients such as Bell Canada,
Rogers and Microsoft, and has led various technology-related initiatives. He
currently sits on the board of two other publicly traded companies, Active
Control Technology Inc. and China Opportunity Inc. Mr. Donnelly has been
involved in financings, acquisitions and technology development. He also
serves as an advisory board director to three private companies.
    Mr. Friedman is the C.O.O. of Edgemere Capital. Prior to this role, he
was the President and CEO of auto parts manufacturer Depco International Inc.
that had $125 million in annual revenues and 800 employees that was sold to
Martinrea International. Mr. Friedman is a lawyer by training with expertise
in corporate governance. He has held senior executive roles at advanced
technology companies Minacs and Unique Broadband Systems. He also previously
served as a director of Motivus Inc., a publicly traded company listed on the
TSX Venture Exchange.
    Mr. Astle is a seasoned business and marketing strategist, and the
founder of Marketing Imperatives International, a marketing and management
consultancy that specializes in mergers, acquisitions, alliances and strategic
business growth initiatives. As the Executive Vice President and Managing
Director - Americas of The Marketing Store Worldwide, a global marketing
agency, he provided multi-disciplined communications services to major brand
marketers such as McDonalds, Shell and Coca-Cola throughout North and South
America. He also founded Gaylord/Generator Idea Works, a leading Canadian
marketing agency, and previously held executive level roles at consumer
products companies.
    Mr. van der Plaat commented, "We are very excited about the addition of
these new directors to our board. With their experience in interactive
marketing, digital media and gaming, I am confident they will make an
invaluable contribution to our company. The new directors will play a key role
in helping SilverBirch develop profitable markets, enhance its product
offerings, and operationalize its strategic acquisitions to enhance
shareholder value."
    Silverbirch issued 6,632,500 units under the private placement. Each unit
consists of one (1) common share (the "Common Shares") and one half (1/2)
Common Share purchase warrant (a "Warrant") of Silverbirch. Each whole Warrant
entitles the holder to acquire one (1) additional Common Share at a price of
$0.18 per share until October 16, 2010. The Common Shares, Warrants and Common
Shares issuable upon exercise of the Warrants will be subject to a four month
hold period under Canadian law following closing of the private placement,
expiring February 17, 2009.
    The net proceeds of the private placement, will be used in conjunction
with the net proceeds of the previously announced $2 million secured note
financing, $700k of which is conditional upon the closing of the RedMile
acquisition, to launch the Multiplayer Online First Person Shooter Game,
CrossFire, and for general corporate purposes.
    In connection with the offering, Silverbirch paid a finder's fee equal to
7% of the gross proceeds and compensation options equal to 8% of the units
sold in the offering. A finder's fee of $37,142 was paid, and 530,600
compensation options were issued, to Aberdeen Gould Capital Markets Ltd., as
finder, of which MGI Securities Inc. received $3,675 and 52,500 compensation
options from Aberdeen Gould for its services in the offering. Each
compensation option will entitle the holder to purchase one Common Share of
Silverbirch at a price of $0.10 until October 16, 2010. The compensation
options are non-transferable and Common Shares issuable upon exercise of the
compensation options will be subject to a four month hold period under
Canadian law following closing of the private placement, expiring February 17,
2009.
    Silverbirch is also pleased to announce that it has now fulfilled the
final escrow condition in connection with its previously announced offering of
a senior secured note, with Third Eye Capital Corporation acting as agent. As
a result, Silverbirch shortly expects to receive from escrow the net proceeds
of the $1,300,000 representing the first part of the secured note offering.

    About SilverBirch Inc.

    Toronto-based SilverBirch Inc. is a leading digital media company
operating in the fastest growing sectors of the video game and mobile markets.
The company's video game operations include SilverBirch Studios, a mobile and
handheld video game developer, Lighthouse Interactive, a publisher of
interactive entertainment based in the Netherlands, and a co-venture with
G4Box Inc. to operate licensed English language online multiplayer games. In
its mobile division it provides mobile marketing services through Jambo Mobile
Solutions and mobile content by way of an investment in CrossRoad Mobile. For
more information see www.silverbirchinc.com.

    
    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of the content of this news release.
    

    Forward-looking Statements - Certain information set forth in this news
release, including management's assessment of future plans, 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 management's control,
including the impact of general economic conditions, and currency
fluctuations. 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.

    %SEDAR: 00020946E




For further information:

For further information: Derek van der Plaat, Chief Executive Officer,
SilverBirch Inc., Tel: (416) 621-6711 Ext 34, Email: derek@silverbirchinc.com;
Paul Haber, SVP & Chief Financial Officer, SilverBirch Inc., Tel: (416)
621-6711 Ext 35, Email: phaber@silverbirchinc.com

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SILVERBIRCH INC.

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