VANCOUVER, British Columbia, July 29, 2024 (GLOBE NEWSWIRE) -- Amcomri Entertainment Inc. (“Amcomri” or the “Company”) (Cboe CA: AMEN) (Frankfurt: 25YO) (OTC: AMNNF) today announced that Trinity Pictures Distribution Limited (“Trinity”), the Company’s wholly-owned direct subsidiary, has entered into a definitive agreement pursuant to which Trinity has agreed to sell the Company’s film production and distribution business.
Summary
Trinity has entered into a share purchase agreement (the “Purchase Agreement”) with Tropico Limited (the “Purchaser”) and Oranmore Limited (the “Guarantor”) pursuant to which Trinity has agreed to sell to the Purchaser (the “Transaction”): (i) the outstanding shares of 101 Films Limited, a wholly-owned subsidiary of Trinity; (ii) certain motion picture distribution assets of 101 Films International Limited (“101 Films International”), a wholly-owned subsidiary of Trinity; (iii) certain motion picture distribution assets of Amcomri Productions Limited (“APL”), a wholly-owned subsidiary of Trinity; and (iv) APL’s interest in Positivor Limited (collectively, the “Film Business”). The Transaction is subject to, and would be completed following, completion of the transactions contemplated by the previously announced share and asset purchase agreement dated June 25, 2024 among the Company, Trinity, APL, Abacus Media Rights Limited, Sphere Media Inc., Sphere Media UK Ltd. and Sphere Media Distribution Inc. (the “Television Sale Transaction”, and together with the Transaction, the “Sale Transactions”). Accordingly, at the time of the Transaction’s completion, the Transaction would constitute a sale of all or substantially all of the Company’s undertaking pursuant to Section 301 of the Business Corporations Act (British Columbia).
A copy of the Purchase Agreement will be made available under the Company’s SEDAR+ profile at www.sedarplus.com.
Consideration
The aggregate consideration payable pursuant to the Transaction is approximately US$921,000 (based on a GBP/USD exchange rate of 1.2877), plus the assumption of certain obligations and liabilities of 101 Films International and APL.
In connection with the Transaction, as an additional inducement for Trinity to enter into and perform its obligations under the Purchase Agreement, the Guarantor has irrevocably and unconditionally guaranteed the performance of all of the obligations of the Purchaser contemplated by the Purchase Agreement (including the payment of the aggregate consideration payable pursuant to the Transaction).
Regulatory Matters
Paul McGowan, Robert Price and Martin Andrew Lyon (collectively, the “Participating Directors”), each being directors and/or senior officers of the Company, are “related parties” (as such term is defined in Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”)) of the Company. The Purchaser is also a related party of the Company pursuant to MI 61-101 because the Participating Directors, each a related party of the Company, beneficially own, in the aggregate, more than 50% of the securities of the Purchaser. As a result, the Film Sale Transaction contemplated by the Purchase Agreement constitutes a “related party transaction” (as each such term is defined in MI 61-101) and is subject to the requirements set out in MI 61-101. Further details will be included in a material change report to be filed by the Company. Such material change report has not been filed 21 days before the entering into of the Purchase Agreement, as the terms of the Purchase Agreement were not finalized and approved by all parties until immediately prior to the entering into of such agreement.
In connection with the Transaction, Grant Thornton LLP has been engaged to prepare an independent formal valuation of the Film Business (the “Formal Valuation”) in the manner prescribed by MI 61-101. A copy of the Formal Valuation will be provided to shareholders of the Company (the “Shareholders”) in a management information circular (the “Circular”) expected to be provided to the Shareholders in the coming days in connection with an annual general and special meeting of the Shareholders to be held on August 28, 2024 (the “Meeting”).
A copy of the Circular will be made available under the Company’s SEDAR+ profile at www.sedarplus.com.
Shareholder Approval
Approval of the shareholders’ resolution in respect of the Transaction (the “Transaction Resolution”) requires the affirmative vote of not less than two-thirds (66⅔%) of the votes validly cast on the Transaction Resolution by Shareholders present in person or represented by proxy at the Meeting. As the Transaction constitutes a related party transaction, the Transaction requires the affirmative vote, as a separate class, of a majority of the votes validly cast on the Transaction Resolution by Shareholders present in person or represented by proxy at the Meeting, excluding any votes cast in respect of common shares of the Company that are required to be excluded pursuant to MI 61-101.
Closing Conditions
The completion of the Transaction is subject to customary conditions precedent for a transaction of this nature, including approval by Shareholders of the Transaction Resolution and the completion of the Television Sale Transaction.
Distribution(s) to Shareholders and Anticipated Dissolution and Possible Delisting
Further to the Company’s news release dated June 26, 2024, in the event that the Television Sale Transaction is ultimately approved by the Shareholders at the Meeting and completed, the Company expects to distribute the available portion of the net proceeds of the completed Sale Transactions (after payment of, among other things, transaction costs and the payment of all liabilities and obligations of the Company) to Shareholders as a return of capital, to proceed with a voluntary windup and dissolution and to possibly delist from Cboe Canada Inc. (“Cboe Canada”). There are many unknown variables that cannot be accurately predicted at this time, along with known items that are difficult to quantify, all of which will impact the ultimate amount, and the anticipated timing, of any distribution(s) payable to Shareholders.
The purpose and business reason for the Transaction is the sale of the Film Business in order to allow the Company, subject to the approval of the Board and the Shareholders, to proceed with a voluntary windup and dissolution of the Company.
Further details regarding each of the Sale Transactions, the return of capital, the planned windup and dissolution of the Company and the Company’s possible delisting from Cboe Canada, and the risks and procedures associated therewith, will be disclosed in the Circular.
Advisors
Norton Rose Fulbright Canada LLP was retained by the Company as its legal advisor, and Wright Hassall LLP was retained by the Purchaser as its legal advisor. Grant Thornton LLP was retained to provide the Formal Valuation in accordance with MI 61-101. In addition, Grant Thornton LLP has also provided the Board with an independent fairness opinion (the “Fairness Opinion”) to the effect that, as of the date of such opinion and based upon and subject to the assumptions, limitations and qualifications therein, the consideration to be received by Trinity in respect of the Film Business pursuant to the Purchase Agreement is fair, from a financial point of view, to the Shareholders (excluding the Participating Directors).
A copy of the Fairness Opinion will be provided to Shareholders in the Circular, a copy of which will be made available under the Company’s SEDAR+ profile at www.sedarplus.com.
About Amcomri Entertainment Inc.
Amcomri Entertainment Inc. (Cboe CA: AMEN) (Frankfurt: 25Y0) provides global distribution capabilities for independent movie, documentary and TV series producers as well as for its own in-house productions. With decades of experience across all key media platforms, Amcomri is rapidly becoming the go-to team for independent producers seeking the broadest possible audience for their productions. The Amcomri Entertainment Inc. group of companies includes 101 Films, 101 Films International, Hollywood Classics International, Amcomri Productions, Appreciated Media Global, Amcomri Productions and Abacus Media Rights.
For further information about Amcomri, see its disclosure documents on SEDAR+ at www.sedarplus.com or visit the company’s website at https://amcomrientertainmentinc.com/.
| For more information please contact: | |
| Larry Howard Amcomri, Chief Financial Officer Email: larry.howard@amcomri.com Phone: +353-87-686-8255 |
Pierre Boucher MBC Capital Markets Advisors Email: pierre@maisonbrison.com Phone: 1-514-731-0000 |
Forward Looking Statements
This news release includes “forward-looking information” and “forward-looking statements” as such terms are defined under applicable Canadian securities legislation. Forward‐looking information and statements include disclosure regarding possible events, that are based on assumptions about future economic conditions and courses of action, and, in certain cases, can be identified by the use of words such as “potential”, “propose”, “aim”, “depend”, “seeks”, “plans”, “expects”, “is expected”, “intends”, “anticipates”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “can”, “could”, “should”, “shall”, “would”, “might” or “will”, or the negative forms of any of these words and other similar expressions. Forward-looking statements in this news release include statements related to: the terms and conditions, and anticipated benefits (if any) to Shareholders and other stakeholders of the Company, of the Transaction, the return of capital, the planned windup and dissolution of the Company and the Company’s possible delisting from Cboe Canada (including any consideration thereunder, as applicable); the satisfaction of the conditions precedent to the Transaction, the return of capital, the planned windup and dissolution of the Company and the Company’s delisting from Cboe Canada (in each case, if at all); the timing and consummation of the Transaction, the return of capital, the planned windup and dissolution of the Company and the Company’s delisting from Cboe Canada (in each case, if at all); the amount of any return or capital or other distribution(s) to Shareholders; and matters relating to the Circular and the Meeting. There can be no assurance that the proposed Transaction, return of capital, windup and dissolution of the Company and the Company’s delisting from Cboe Canada will be completed at all or on the terms and conditions contemplated therein and in this news release. Forward‐looking information and statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward‐looking information and statements. Such factors include, but are not limited to, risks relating to: approvals required in connection with the Transaction; the satisfaction or waiver of the conditions precedent to the Transaction (if at all) and adverse changes in applicable laws or regulations; delay or inability of the Purchaser to pay the consideration contemplated by the Purchase Agreement; the expenses incurred to complete the Transaction, the return of capital, the planned windup and dissolution of the Company and the Company’s delisting from Cboe Canada; the ability of the Company to pay all liabilities and obligations of the Company, general business, economic, competitive, political and social uncertainties, uncertain and volatile equity and capital markets. Actual results and future events could differ materially from those anticipated in such forward looking information. Accordingly, readers should not place undue reliance on forward‐looking information. All forward-looking information in this news release is made as of the date hereof and qualified by these cautionary statements and those in our continuous disclosure filings available on SEDAR+ at www.sedarplus.com. The Company disclaims any intention or obligation to update or revise such forward‐looking information, whether as a result of new information, future events or otherwise, except as required by law.
Investors are cautioned that, trading in the securities of the Company should be considered highly speculative. For a more detailed discussion of such risks and uncertainties, please see the section entitled “Risk Factors” in the Company’s annual information form dated June 2, 2024, and available under the Company’s profile on SEDAR+ at http://www.sedarplus.com.