RHM.L Regulatory News (RHM)

15 September 2021

ROUND HILL MUSIC ROYALTY FUND LIMITED

("RHM" or the "Company")

Acquisition of 30 song catalogue from Tim Palmer

Provides the Company with exposure to Pearl Jam and Ozzy Osbourne

The Board of Round Hill Music Royalty Fund Limited is pleased to announce that the Company has acquired recorded music income and publishing rights to 30 songs from Tim Palmer, an English record producer, guitarist and songwriter of rock and alternative music.

Key Acquisition Highlights:

· Catalogue of 30 songs covering tracks from the essential Pearl Jam album "Ten", and producer and publishing royalties for Ozzy Osbourne's album "Down to Earth";

· "Ten" is Pearl Jam's debut album, selling over 25 million records worldwide and has been certified Diamond and 13x Platinum by the Recording Industry Association of America. The album contains their most popular songs such as "Even Flow", "Black" and "Jeremy";

· Catalogue includes major hits such as "Alive", which received a certification from the British Phonographic Industry, going Silver in August 2018 for sales and streams of over 200,000;

· Worldwide accolades for this catalogue include 6 number 1s and 20 top 10s; and

· "Down to Earth", the album by Ozzy Osbourne, reached number 4 on the Billboard Charts and 18 in the UK. It was certified Platinum in the US and Gold in UK.

Background to the Catalogue

Tim Palmer is best known for his role in mixing Pearl Jam's album "Ten", which reached number 2 on the Billboard 200 in 1992. The album produced three hit singles: "Alive", "Even Flow" and "Jeremy". "Jeremy" became one of Pearl Jam's best-known songs and received nominations for Best Rock Song and Best Hard Rock Performance at the 35th Grammy Awards. To this day, Pearl Jam is considered one of the most important rock bands of its time and a leader of the 1990s Grunge movement and "Ten" ranks in the top 50 best selling albums of all time in the US according to RIAA data. Over his expansive career, Tim has worked with a number of other highly influential rock and alternative artists including U2, Robert Plant, Tears for Fears, David Bowie and Ozzy Osbourne, for whom he produced and wrote on the Platinum-selling album "Down to Earth".

Catalogue Details

RHM's acquisition of the catalogue includes rights to publishing and recorded music royalties. These rights are broken down as follows:

· 100% of the mixer royalty income for the master recording rights on Pearl Jam's album "Ten";

· 100% of the producer income for the master recording rights on the Ozzy Osbourne album "Down to Earth"; and

· 100% of the publishing interest (including writer's share) in six of the eleven tracks on "Down to Earth".

The publishing share of the catalogue that RHM has acquired offers exposure to a global audience, with 27 per cent of revenue derived from outside of the US.

The revenue from master recording rights comprises 82% of catalogue earnings, with publishing earnings accounting for 3%, and other sources comprising 15%.

The catalogue revenues are focused towards the top tracks, with the Top 3 Songs accounting for 45%, Top 5 Songs accounting for 66% and Top 10 Songs accounting for 82% of revenues.

All figures above are based on the catalogue's royalty statement in the calendar year 2020.

Disclosure of Financial Detail on Acquisitions

Due to commercial sensitivities, the Company is unable to disclose financial details for each acquisition as it occurs. However, on completion of the investment of proceeds from the C Share fundraise of US$86.5 million, together with the remaining undrawn balance of its existing revolving credit facility (the "RCF"), the Company will make further financial disclosure on the acquisitions.

Trevor Bowen, Chair of Round Hill Music Royalty Fund, commented:

"We are very pleased to announce this high-quality catalogue of excellent songs including timeless rock and alternative tracks from two of the world's most well-known artists. The Board is pleased to be utilising the RCF and C Share placing proceeds to further expand the Company's portfolio of diverse catalogues. The Company's investment pipeline remains strong with a number of identified near-term opportunities in exclusivity."

Josh Gruss, Chairman and CEO of Round Hill, the Company's investment manager, commented:

"Tim Palmer is a well-renowned record producer who has mixed and produced some of the most iconic rock and alternative albums and songs over the past four decades. This investment echoes our strategic objective of purchasing royalty rights to classic songs that have proven their ability to produce long-term, steady royalty revenues over the decades, while acquiring the catalogues at attractive valuations."

Tim Palmer commented:

"Last year I celebrated my 5th decade either producing or mixing a UK top 10 album, and after 40 years of working in the business, I am excited to venture into something that feels like a new chapter. Signing to Round Hill is a very unique opportunity for me, and Josh and his team have already shown how much they love and respect the music. I am proud to be part of their ever-expanding family."

FOR FURTHER INFORMATION

Notes: 

Unless the context otherwise requires, capitalised terms used in this announcement have the meanings in the Prospectus.

The Company is a non-cellular Guernsey company. The Company's Investment Objective is to provide investors with an attractive level of regular and growing income and capital returns from investment primarily in high quality, music intellectual property. In order to achieve its Investment Objective, the Company will invest in a songwriter's copyright interest in a musical composition or song (being their writer's share, their publisher's share and their performance rights) together with the rights in the recording of the musical composition or song (known as the master recording rights) together with all such rights and assets considered by its investment manager, Round Hill Music LP ("Round Hill"), to be ancillary thereto. 

Founded in 2010, Round Hill is a fully integrated owner and operator of music copyright properties and the sixth largest music publishing company in the US. Headquartered in New York with additional offices in Nashville, Los Angeles and London, Round Hill has an experienced management and investment team with an established reputation and extensive experience in the music and finance industries.