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TORONTO, Nov. 26 /CNW/ - Fluid Music Canada, Inc. ("Fluid"; TSX: FMN) today announced that it completed its equity offering of 9.26 million common shares at a price of $1.75 per common share for gross proceeds of $16.2 million.
Net proceeds of the financing were approximately $15.38 million and will be used to satisfy in part the cash consideration payable by Fluid pursuant to its successful acquisition of all of the outstanding units of Somerset Entertainment Income Fund ("Somerset"), on a fully-diluted basis, which units were taken up on November 25, 2009.
The financing was co-led by Desjardins Securities Inc. and Octagon Capital Corporation.
In addition, the Credit Agreement among Somerset Entertainment Limited Partnership and the Toronto Dominion Bank was amended to provide for, amongst other discretionary changes, the consent to the change of control of Somerset and an adjustment of the interest rates payable thereunder to current market rates for credit facilities of this nature.
About Fluid Music Canada, Inc.
Fluid is a leading private label music aggregation and distribution company, providing music solutions to both business and individual consumers. Fluid has compiled a music library of over five million songs, free of digital rights management restrictions, from a diverse network of producers, including major label, independent and emerging artists. Fluid's revenue model is comprised largely of programming and broadcasting services for retail and hospitality businesses through a wholly-owned subsidiary. Fluid's objective is to grow its business by monetizing its music catalogue through a range of sales channels and partners.
About Somerset Entertainment Income Fund
Somerset is the leading North American producer and distributor of specialty music and DVDs sold internationally through non-traditional music retailers using interactive displays and a distributor of music in digital format. Somerset's extensive distribution network includes mass merchants, specialty chains and independent gift stores in more than 20 countries, including the United States and Canada. Based in Toronto, Canada, Somerset employs over 180 people at offices in Toronto, Ontario (Canada); Buffalo Grove, Illinois, and Minneapolis, Minnesota (U.S.A.); and Essex, England (U.K.).
Certain statements contained in this release, and elsewhere in Fluid's offer and take-over bid circular dated October 20, 2009 for Somerset (the "Offer"), concerning Fluid's objectives, goals, strategies, intentions, plans, beliefs, expectations and estimates, and the business, operations, financial performance and condition of Somerset and Fluid are forward-looking statements. The words "believe", "expect", "anticipate", "estimate", "intend", "may", "will", "would" and similar expressions and the negative of such expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements are subject to important assumptions, including the following specific assumptions: the ability of Somerset and Fluid to meet their respective revenue targets; the ability to achieve cost synergies; general industry and economic conditions; changes in Somerset's and Fluid's relationships with their customers and suppliers; pricing pressures and other competitive factors; and changes in regulatory requirements affecting the businesses of Somerset and Fluid. Fluid has also made certain macroeconomic and general industry assumptions in the preparation of such forward-looking statements. While Fluid considers these factors and assumptions to be reasonable based on information currently available, they may prove to be incorrect.
Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Such factors include, but are not limited to: risks related to any inefficiencies with the structure of Somerset and/or Fluid, their respective tax treatments and any costs associated with reorganizing Somerset following closing; Fluid may not have sufficient funds to repay the convertible debentures issued in connection with the Offer in cash at maturity; general economic and business conditions; financing risk; risks inherent in the business of operating Somerset and Fluid, including the inability to attract and retain qualified employees; competition; disruptions in business operations; interest rate and foreign currency fluctuations; existing governmental regulations and changes in, or the failure to comply with, governmental regulations; and liability and other claims asserted against Somerset or Fluid. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. There can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, Fluid and/or Somerset. Forward-looking statements are given only as at the date hereof and both Fluid and Somerset disclaim any obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable laws.
Additional information relating to Fluid Music Canada, Inc. is available at www.fluidmusic.com and www.sedar.com. Additional information relating to Somerset Entertainment Income Fund is available at www.somersetent.com and www.sedar.com.
SOURCE FLUID MUSIC CANADA, INC.
For further information: For further information: Fluid Music Canada, Inc., Lorne Abony, President & Chief Executive Officer, (310) 665-9878