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Works Media Grp(The) (WKS)

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Friday 31 October, 2008

Works Media Grp(The)

Related Party Transaction

RNS Number : 1059H
Works Media Group (The) PLC
31 October 2008
 



THE WORKS MEDIA GROUP PLC


RELATED PARTY TRANSACTION


The Works Media Group plc (the 'Company') announces that it has today entered into a secured  

revolving convertible loan agreement (the 'Loan Agreement') with Milcoz Films Limited ('Milcoz') whereby Milcoz has made available to the Company a loan facility of up to £750,000 for the purpose of:


  • acquiring international sales agency rights;
  • investing as an equity investor in films;
  • acquiring distribution rights in completed films or film catalogues
  • making corporate acquisitions; or 
  • funding print and advertising expenditure in respect of UK distribution activity.

The principal terms are that the facility may be drawn down in tranches during a period of two years from the first draw-down. Interest is payable at a rate of 3% above the Bank of England base rate and is paid six monthly in arrears.  Each tranche drawn down shall be repaid within three years of that tranche being drawn down. In order to provide security for the Loan Agreement, the Company has also today entered into a debenture agreement with Milcoz.


Amounts of loan remaining unpaid at the end of each three-year period can be converted, at Milcoz's option, into fully paid up ordinary shares of the Company.  Conversion will occur at the average mid market price of the Company's shares in the 30 day period prior to the conversion date.  Alternatively, if a share placing occurs at any time, Milcoz may elect to convert all or any part of the debt then outstanding, on the same terms as the rest of the share placing.  Conversion will, in any event, only be possible to the extent that the resultant holding of Milcoz (and/or its connected partiesis no more than 29.9% of the issued ordinary share capital.  It and its connected parties currently hold 44,103,209 ordinary shares representing 29.9% of the issued share capital.


Under AIM Rule 13, the Loan Agreement constitutes a Related Party Transaction as Milcoz is a related party as defined in the AIM Rules for Companies because it is a substantial shareholder, and one of its directors, Costa Theois chairman of the Company.  The remaining directors of the Company, who are deemed to be independent directors for these purposes, consider, having consulted with Dowgate Capital Advisers Limited, the Company's nominated adviser, that the terms of the Loan Agreement are fair and reasonable insofar as the Company's shareholders are concerned.

 

For further information, please contact:


The Works Media Group plc                                                                 020 7612 0030

Norman Humphrey, CEO


Dowgate Capital Advisers Limited                                                         020 7492 4777

James Caithie

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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