Corporation (NASDAQ: LOCM), a leading online local media company,
today announced that it has entered into a definitive agreement with The
Tail Wind Fund Ltd., as lead investor, to sell $5 million in convertible
subordinated notes and warrants to purchase common stock. The proceeds
are to be used for general working capital.
The convertible subordinated notes bear interest at 7 percent per year
and are convertible into shares of Local Corporation's common stock at
$2.01 per share, representing a 14.2 percent premium to the company's
closing price on April 9, 2013. In connection with the sale of the
convertible notes, the company also issued to the investors warrants to
purchase 746,268 shares of common stock at an exercise price of $2.01
per share. The convertible notes mature on April 11, 2015. The warrants
are exercisable through April 11, 2018.
"This investment represents a welcome endorsement of our long-term
strategy, which is dedicated to sustaining strong revenue and earnings
growth through building competitive advantages in the markets we serve,"
said Heath Clarke, Local Corporation chairman and CEO. "It allows us to
improve our liquidity and fund our key growth initiatives."
"We believe that Local Corporation is well-positioned to capitalize on
the growing revenue opportunities within the local online advertising
market," said Daniel Nye, Portfolio Manager for CIM Investment
Management Ltd., the fund manager of The Tail Wind Fund Ltd. "We are
looking forward to the company's future growth opportunities and
Merriman Capital, Inc., a wholly owned subsidiary of Merriman Holdings,
Inc. (OTCQX:MERR) acted as lead Placement Agent and Ladenburg Thalmann &
Co. Inc., a subsidiary of Ladenburg Thalmann Financial Services Inc.
(NYSE MKT:LTS) assisted on the transaction.
About Local Corporation
Local Corporation (NASDAQ:LOCM) is a leading online local media company
that connects brick-and-mortar businesses with over a million online and
mobile consumers each day using a variety of innovative digital
marketing products. To advertise, or for more information, visit: http://localcorporation.com.
Forward Looking Statements
This press release contains certain "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. Words or expressions such as
'anticipate,' 'believe,' 'estimate,' 'plans,' 'expect,' 'intend,'
'project,' 'forecast,' 'potential,' 'feel' and similar expressions and
phrases are intended to identify such forward-looking statements. Any
forward-looking statements are based on the beliefs of our management as
well as assumptions made by and information currently available to our
management. Actual results could differ materially from those
contemplated by the forward-looking statements as a result of certain
factors, including, but not limited to, our advertising partners paying
less revenue per click and revenues to us for our search results, our
ability to purchase advertising from third parties to drive users to our
sites, our ability to adapt our business following the shifts in our
monetization partners, our ability to monetize the Local.com domain,
including at a profit, our ability to retain a monetization partner for
the Local.com domain and other web properties under our management that
allows us to operate profitably, our ability to develop, market and
operate our local-search technologies, our ability to market the
Local.com domain as a destination for consumers seeking local-search
results, our ability to realize the expense savings from our recently
announced cost savings measures, our ability to comply with our debt
covenants, our ability to raise additional funds when needed and on
terms that are acceptable to us, our ability to grow our business by
enhancing our local-search services, including through businesses we
acquire, the integration and future performance of our Spreebird
business and our Krillion business, the possibility that the information
and estimates used to predict anticipated revenues and expenses
associated with the businesses we acquire are not accurate, difficulties
executing integration strategies or achieving planned synergies, the
possibility that integration costs and go-forward costs associated with
the businesses we acquire will be higher than anticipated, our ability
to successfully expand our sales channels for new and existing products
and services, our ability to increase the number of businesses that
purchase our advertising products, our ability to expand our advertiser
and distribution networks, our ability to integrate and effectively
utilize our acquisitions' technologies, our ability to develop our
products and sales, marketing, finance and administrative functions and
successfully integrate our expanded infrastructure, as well as our
dependence on major advertisers, competitive factors and pricing
pressures, changes in legal and regulatory requirements, and general
economic conditions. Any forward-looking statements reflect our current
views with respect to future events and are subject to these and other
risks, uncertainties and assumptions relating to our operations, results
of operations, growth strategy and liquidity. All subsequent written and
oral forward-looking statements attributable to us or persons acting on
our behalf are expressly qualified in their entirety by this paragraph.
Unless otherwise stated, all site traffic and usage statistics are from
third-party service providers engaged by the company.
Our most recent Annual Report on Form 10-K and subsequently filed
Current Reports on Form 8-K, and other Securities and Exchange
Commission filings discuss the foregoing risks as well as other
important risk factors that could contribute to such differences or
otherwise affect our business, results of operations and financial
condition. The forward-looking statements in this release speak only as
of the date they are made. We undertake no obligation to revise or
update publicly any forward-looking statement for any reason.
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