2012-11-28 14:49:31 -
TORONTO, CANADA -- (Marketwire) -- 11/28/12 -- Intertainment Media Inc. ("Intertainment" or the "Company") (TSX VENTURE:INT)(OTCQX:ITMTF)(FRANKFURT:I4T) announced today that it has entered into a letter of intent to sell its stake in the itiBiti platform for a total value of $3.5 million to a private technology group which is expected to provide up to $4.5 Million in additional equity value in the form of system development and enhancements. The transaction will take the form of cash, debt conversion as well as equity participation and will provide Intertainment with a 40% equity stake in the operating company. This operating company will be managed by the private technology group owning a 60% stake and will undertake the day to day management, operations and development of the platform including the KNCTR application. The deal also calls for Intertainment to receive one board seat as well as a secured perpetual revenue share of 40% for the first 2 years and declining to 20% annually at year 5 and beyond from the independently managed operation.
Should a future liquidity event occur, where the new enterprise is sold privately or transferred to a public vehicle, Intertainment will receive the initial 30% of the proceeds, up to $5 Million CDN, and 40% of the balance of the value of the transaction.
This announcement, coming in advance of Intertainment Media's Annual General Meeting, where the company will outline its corporate focus moving forward, is one of the first that underscores the tangible delivery of Intertainment's corporate strategy.
The transaction, which is expected to close within sixty (60) days, is subject to due diligence and negotiation of definitive agreements. This agreement represents a significant increase in value as well as a future opportunity with a liquidity event as the initial investment in the itiBiti platform was originally purchased in 2009 for $2 million in a cash and stock transaction.
"This transaction validates Intertainment's incubation process, as we look to invest, develop and nurture investments with a view towards creating continuous value," said David Lucatch, CEO Intertainment Media Inc.
Once a definitive agreement is finalized, the Company will provide further updates and details.
About Intertainment - www.intertainmentmedia.com : www.intertainmentmedia.com
Intertainment is one of Canada's leading technology incubators and is focused on developing, nurturing and investing in both North American and global technologies and companies that provide technology solutions for brands and consumers alike. Intertainment also owns and operates a number of key properties including Ad Taffy, itiBiti (KNCTR), Ortsbo, Deal Frenzy, The Sweet Card and Magnum, with investments in leading edge technologies and social media platforms including theaudience.com. For more information on Intertainment and its properties, please visit www.intertainmentmedia.com.
Intertainment is headquartered in the Toronto, Canada region, with offices in New York, Los Angeles and San Mateo, CA and is listed on the TSX Venture Exchange under the symbol "INT" (TSX VENTURE:INT) and in the US on the OTCQX Market under the symbol "ITMTF". Intertainment is also traded in Europe on the Open Market (Regulated Unofficial Market) of the Frankfurt Exchange through the XETRA trading platform under the symbol "I4T".
Forward Looking Information
This news release contains certain "forward-looking information" within the meaning of such statements under applicable securities law including statements relating to the Placement.
Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Forward-looking information is based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Actual timelines associated may vary from those anticipated in this news release and such variations may be material. Actual results could differ materially because of factors discussed in the management discussion and analysis section of our interim and most recent annual financial statements or other reports and filings with the TSX Venture Exchange and applicable Canadian securities regulations. The Company undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change, unless required by law. The reader is cautioned not to place undue reliance on this forward-looking information.
This news release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States or to or for the account or benefit of U.S. persons (as such terms are defined in Regulation S under the United States Securities Act of 1933, as amended (the "U.S. Securities Act")), absent registration or an exemption from registration. The securities offered have not been and will not be registered under the U.S. Securities Act or any state securities laws and, therefore, may not be offered for sale in the United States, except in transactions exempt from registration under the U.S. Securities Act and applicable state securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Intertainment Media Inc.