Genius Brands International, Inc. (“Genius Brands” or the
“Company”) (NASDAQ:GNUS) today filed a preliminary proxy statement
in connection with a special meeting of stockholders that is
expected to be held via live webcast at 10:00 a.m. Pacific Daylight
Time, on Thursday, August 27, 2020.
Genius Brands Chairman & CEO, Andy Heyward,
issued the following statement:
“Today we filed a
preliminary proxy for a special meeting of stockholders that is
expected to be held on Thursday, August 27, 2020. The primary
purpose of this meeting is to amend our Articles of Incorporation
to increase the authorized number of shares of Genius Brands
International, Inc. common stock from 233 million to 400 million
shares.
I want to make sure that all our shareholders
understand exactly why we have proposed this amendment, and why we
are confident it is in the shareholders’ interests. The purpose of
these new shares will be to take advantage of unusual current
opportunities to acquire assets in the consolidating entertainment
space, which will be accretive to the company.
Normally, people associate the issuance of
shares with dilution, however when the dilution is accretive, the
benefit to the company is exceeded by the acquisition of the asset,
and is greater than the dilutive effect. That is the primary
purpose of having these new shares available. I speak not only as
your Chairman and CEO, but as one of the largest shareholders in
the company. My interests are fully aligned with those of our
shareholders of common stock. We have only one class of voting
stock, it is common stock and mine1 is the exact same as all other
shareholders.
Today, there is great consolidation going on in
the entertainment industry. There are valuable program and
distribution assets available and a smart company able to be deft
and nimble can acquire them on extremely attractive terms, and may
witness values that might not be available for a long
time. The Genius common stock is a valuable currency that I
believe will enable us to do that.
One only needs to look at The Walt Disney
Company’s playbook, to see the value changing transformation of
important assets….all acquired through issuance of new
stock.
- Pixar
- LucasFilms/StarWars
- Marvel Entertainment
Imagine what the Walt Disney Company would have
been today without having been smart and moved to acquire these
companies.
We believe there are opportunities today for
Genius Brands as well, which can be equally as important for our
company.
I have often spoken about the caliber of our
management team, and its pedigree from the top of the most
successful companies in Hollywood. I also want to draw
attention to the pedigree of your Board of Directors. We have
the former Managing Director of Entertainment at J.P. Morgan, one
of the largest banks in the world, with a leading global media
mergers and acquisitions practice. We have the former Governor
of California, the former President of ABC Entertainment, and the
former Head of Entertainment for Bear Stearns.
The Board met and voted this morning and
determined unanimously it was in the company’s interests to pursue
a robust M&A strategy, by increasing the availability of new
shares to issue. We are focused and determined to grow Genius
Brands into the leader in children’s and family entertainment. As
Genius Brand’s largest shareholder, I can say wholeheartedly that
my interests are aligned with our shareholders to create
value. We are committed to doing what’s in our shareholders’
best interests and our interests are fully aligned with yours.”
About Rainbow Rangers Featuring engaging
storylines rooted in themes of empowerment, diversity, friendship,
and sustainability, Rainbow Rangers, with two seasons
produced, is a rescue-based series that follows the adventures of
seven girls who are Earth’s first responders, protecting people,
animals, resources, and the natural beauty of our world. The
series boasts a unique and highly-accomplished team of
creators from the animated motion picture and television worlds,
including Rob Minkoff (Disney’s The Lion King director),
Shane Morris (Disney’s Frozen co-writer), Tim Mansfield, and New
York Times Bestselling author and Emmy Award-nominated writer
Elise Allen (Dinosaur Train, Lion Guard, Barbie specials), who
serves as head writer and co-creator. Multiple
Emmy Award-winning director Michael Maliani directs the
series, and Genius Brands' Chairman and CEO and multiple Emmy
Award-winning producer, Andy Heyward, serves as executive
producer.
About Llama Llama Based on the award-winning
and bestselling book series by celebrated author and illustrator
Anna Dewdney, the preschool series is about first childhood
experiences and adventures, as well as the special connections
between the lead character, Llama, his Mama and his
grandparents. Llama Llama tells heart-warming tales of
life in a safe, friendly town seen through the eyes of Llama as he
interacts with the amazing world around him. Seasons one and
two of the series are available on Netflix with Jennifer Garner in
the lead role as Mama Llama.
With over 30 million units in print worldwide,
Dewdney’s Llama Llama books from Penguin Young Readers
have all been New York Times bestsellers with several
titles claiming the #1 spot, and her work has been translated
into eight languages. Dewdney’s soothing tales are
synonymous with calming early-childhood anxiety and she was praised
by the Chicago Tribune as a “geographer extraordinaire of
the emotional terrain of preschoolers and their mothers.” Books in
her Llama Llama series include Llama Llama Red
Pajama, Llama Llama Holiday Drama, Llama Llama Misses
Mama, and Llama Llama Time to Share.
About Superhero Kindergarten From the genius
mind of the late Stan Lee comes the action-adventure comedy
series Stan Lee’s Superhero Kindergarten (52 x 11’),
starring Arnold Schwarzenegger. The series brings the very best
superhero storytelling to a new generation of preschoolers with
action, comedy and heart. Embedded in each episode is a valuable
life-lesson about health, exercise, nutrition and
anti-bullying! Stan Lee’s Superhero Kindergarten is
co-produced by Alibaba Group, Stan Lee’s POW! Entertainment, and
Schwarzenegger’s Oak Productions. In addition to his
likeness, Schwarzenegger lends his voice as the lead character in
the series. Co-creator of Deadpool, Fabian Nicieza, who has
sold over 100 million comics worldwide, is scripting the
series. Schwarzenegger joins Genius Brands’ Chairman and
CEO Andy Heyward, as well as Paul Wachter, CEO of Main Street
Advisors, and President of POW! Entertainment Gill Champion as
Executive Producers.
About Kartoon Channel! Kartoon Channel! is
available in over 100 million U.S. television households and over
200 million mobile devices, across multiple AVOD, OTT and cable
platforms, including Amazon Prime, Amazon Fire, Apple TV, Apple
IOS, Android, Roku, DISH, Sling TV, Comcast’s Xfinity on Demand,
Cox, Tubi, Xumo, SelectTV, Redbox, Plex, and YouTube.
Kartoon Channel!’s executive team includes former President
of Fox Kids Networks, Margaret Loesch (Executive Chairman), Former
Walt Disney Television President David Neuman (Chief Creative
Officer), and Caroline Tyre (General Manager).
About Stan Lee Universe Genius Brands and Stan
Lee’s POW! Entertainment have formed a joined venture to
create Stan Lee Universe. Stan Lee Universe will
assume worldwide rights, in perpetuity, to the name, physical
likeness, physical signature, live-action and animated motion
picture, television, online, digital, publishing, comic book,
merchandising and licensing rights to Stan Lee and his IP creations
past*, present, and going forward. Genius Brands is the
managing and controlling partner of the Stan Lee
Universe. Headed by the recently appointed producer of
Batman, Michael Uslan, Stan Lee Universe will be built
from the repository of all of the characters and IP created by Stan
Lee, post-Marvel Entertainment, not otherwise elsewhere. It
is drawn from over 100 original Stan Lee creations, from which
Genius Brands will develop and license approximately seven
properties per year.
About Genius Brands International Genius Brands
International, Inc. (Nasdaq: GNUS) is a leading global kids media
company developing, producing, marketing and licensing branded
children’s entertainment properties and consumer products for media
and retail distribution. The Company’s award-winning ‘content with
a purpose’ portfolio includes the upcoming Stan Lee’s
Superhero Kindergarten, starring Arnold Schwarzenegger and in
partnership with Alibaba; Rainbow Rangers for Nick
Jr.; Llama Llama, starring Jennifer Garner, for Netflix;
award-winning toddler brand Baby Genius; adventure comedy STEM
series Thomas Edison's Secret Lab; and entrepreneurship series
Warren Buffett's Secret Millionaires Club. Through licensing
agreements with leading partners, characters from Genius Brands’ IP
also appear on a wide range of consumer products for the worldwide
retail marketplace. The Company’s new Kartoon Channel! is available
in over 100 million U.S. television households via a broad range of
distribution platforms, including Comcast, Cox, DISH, Amazon Prime,
Sling TV, Apple TV, Roku, Amazon Fire and more. For additional
information, please visit www.gnusbrands.com.
Forward Looking Statements: Certain statements
in this press release constitute "forward-looking statements"
within the meaning of the federal securities laws. Words such as
"may," "might," "will," "should," "believe," "expect,"
"anticipate," "estimate," "continue," "predict," "forecast,"
"project," "plan," "intend" or similar expressions, or statements
regarding intent, belief, or current expectations, are
forward-looking statements. While the Company believes these
forward-looking statements are reasonable, undue reliance should
not be placed on any such forward-looking statements, which are
based on information available to us on the date of this release.
These forward looking statements are based upon current estimates
and assumptions and are subject to various risks and uncertainties,
including without limitation, our ability to generate revenue or
achieve profitability; our ability to obtain additional financing
on acceptable terms, if at all; our ability to repay our
outstanding debt; the potential issuance of a significant number of
shares to our convertible note holders which will dilute our equity
holders; fluctuations in the results of our operations from period
to period; general economic and financial conditions; our ability
to anticipate changes in popular culture, media and movies, fashion
and technology; competitive pressure from other distributors of
content and within the retail market; our reliance on and
relationships with third-party production and animation studios;
our ability to market and advertise our products; our reliance on
third-parties to promote our products; our ability to keep pace
with technological advances; our ability to protect our
intellectual property and those other risk factors set forth in the
“Risk Factors” section of the Company’s most recent Annual Report
on Form 10-K and in the Company's subsequent filings with the
Securities and Exchange Commission (the "SEC"). Thus, actual
results could be materially different. The Company expressly
disclaims any obligation to update or alter statements whether as a
result of new information, future events or otherwise, except as
required by law.
Important Information for Genius Brands International,
Inc. Shareholders
In connection with the special meeting, the
Company will file a definitive proxy statement with the SEC.
Additionally, the Company will file other relevant materials with
the SEC in connection with the special meeting. Copies may be
obtained free of charge at the SEC’s web site at www.sec.gov.
Shareholders of the Company are urged to read the definitive proxy
statement and the other relevant materials when they become
available before making any voting decision with respect to the
proposed charter amendment because they will contain important
information about the charter amendment.
Participants in the Solicitation
The Company and its directors and officers may
be deemed participants in the solicitation of proxies of the
Company’s shareholders in connection with the proposed charter
amendment. Shareholders may obtain more detailed information
regarding the names, affiliations and interests of certain of the
Company’s executive officers and directors in the solicitation by
reading the Company’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2019 and the definitive proxy statement and
other relevant materials filed with the SEC in connection with the
proposed charter amendment when they become available.
MEDIA CONTACT:pr@gnusbrands.com
INVESTOR RELATIONS
CONTACT:
ir@gnusbrands.com
1 Technically, I still own 100 shares of Preferred stock
remaining from when we had Preferred stock. These shares will
shortly be converted to common stock, ensuring I am 100% fully
aligned with all shareholders’ common stock.
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