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Appreciated Files Annual and Interim Financial Statements, Restates Annual Financials Statement for 2019 and Applies for Revocation of Cease Trade Order

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Appreciated Media Holdings Inc.
·8 min read
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VANCOUVER, British Columbia, Feb. 17, 2021 (GLOBE NEWSWIRE) -- Appreciated Media Holdings Inc. (“Appreciated” or the “Company”) (TSXV: AMH) (OTCQB: AMEFF) is pleased to announce that the Company has filed its financial statements and management’s discussion and analysis (“MD&A”) for the year ended June 30, 2020 (the “Annual Financial Statements”) and for the interim periods ended September 30, 2020 and December 31, 2020 (the “Interim Financial Statements”).

Further, in connection with the preparation of the Annual Financial Statements, the Company determined that there was an error in the annual financial statements for the year ended June 30, 2019 statements (the “2019 Financials Statements”) whereby a secured loan and an unsecured loan receivable in respect of “10 Double Zero” should have been recorded. The error resulted in an understatement of liabilities of $354,974, assets of $336,500 and net comprehensive loss of $18,474.

The error has been corrected by restating each of the affected financial statement line items for the prior periods in the Annual Financial Statements as follows:

Consolidated Statement of Financial Position (extract)

June 30,
2019

Increase /
(Decrease)

June 30, 2019
(restated)

Cash

$

141,303

$

-

$

141,303

Accounts receivable and other receivables

1,366,802

-

1,366,802

Prepaid expenses

-

-

-

Loans receivable

449,452

336,500

785,952

Movie rights inventory

269,501

-

269,501

AVOD rights

1

-

1

Movie production royalty asset

1

-

1

Total assets

$

2,227,060

$

336,500

$

2,563,560

Trade payables and accrued liabilities

$

1,518,377

$

1,518,377

Short term loans

1,251,943

354,975

1,606,91

Due to related party

24,794

-

24,794

Total liabilities

$

2,795,113

$

18,474

3,150,088

Share capital

14,145,811

-

14,145,811

Contributed surplus

529,350

-

529,350

Accumulated deficit

(15,243,214)

(18,475)

(15,261,689)

Total shareholders’ equity

(568,053)

$

(18,475)

(586,528)

Consolidated Statement of Loss and Comprehensive Loss (extract)

June 30,
2019

Increase /
(Decrease)

June 30, 2019
(restated)

Financing costs

$

-

$

28,408

$

28,408

Foreign exchange

$

(15,433)

$

(9,933)

$

(5,410)

Net loss and comprehensive loss

$

(12,742,753)

(18,475)

$

(12,761,228)

Loss per share

$

(0.42)

$

-

$

(0.42)

In addition, during the year June 30, 2020, the Company completed an internal restructuring pursuant to which a number of assets together with their associated liabilities have been transferred to certain third parties, including:

  • During the year ended June 30, 2020, the Company assigned accounts receivable of $1,308,700 and corresponding accounts payable $1,308,700 to a company controlled by a former director of Appreciated.

  • During the year ended June 30, 2020, the Company assigned a loan receivable of $449,452 (US$340,000) and corresponding liability of $449,452 to a Company controlled by the former CEO of Appreciated.

  • During the year ended June 30, 2020, the Company assigned a loan receivable of $554,540 (USD425,000) and corresponding liability of $554,540 to a Company controlled by the former CEO of Appreciated.

  • During the year ended June 30, 2020, the Company assigned a loan receivable of $474,552 and corresponding liability of $474,552 to a Company controlled by the former CEO of Appreciated.

  • During the year ended June 30, 2020, the Company assigned a loan receivable of $76,404 and corresponding liability of $76,404 to a Company controlled by the former CEO of Appreciated.

The foregoing transactions, have been conducted as part of a restructuring designed to simplify the Company’s balance sheet by removing assets that were offset entirely by associated liabilities. Further, as a result of the reorganization, the Company has been able to avoid the need to proceed with an insolvency proceeding as a result of the Company’s inability to pay its creditors as they have come due; in part, as a result of Appreciated’s failure to achieve revenue during the last two (2) years of operations. Managements is currently reviewing options with respect to the Company with the intention of identifying opportunities for rebuilding the value of the Company.

Further, as previously announced by the Company, since the end of the financial year ended June 30, 2020:

  • The Company has entered a number of forbearance agreements with its lender, Amcomri GP BVI Limited (“Amcomri”) in relation to missed deadlines for repayment of the Company’s debt to its lender. On November 27, 2020, the Company entered into a forbearance agreement with Amcomri pursuant to which Amcomri agreed to forbear on the enforcement of its rights against the Company until January 5, 2021 and to provide $100,000 of bridge financing to the Company.

  • On December 9, 2020, the former CEO resigned as a director of the Company. In connection with the departure, the Company agreed to return assets to the former CEO’s holding company that were acquired by the Company in May 2020. Moreover, the former CEO agreed to (i) surrender for cancellation 425,000 common shares of the Company and 200,000 stock options, (ii) forgive and release approximately $1,000,000 owed by the Company to the former CEO, and (iii) assist and guarantee the repayment of $150,000 owing by the Company to its principal creditor, Amcomri.

  • On December 21, 2020, the Company has entered into a further bridge financing arrangement (the “Facility”) with Amcomri. Pursuant to the Facility, Amcomri has made an additional $470,000 available to the Company to be used to repay certain debts of the Company. All amounts advanced under the Facility will bear interest at a rate of eight percent (8%) per annum, payable upon demand.

For further information regarding each of the foregoing matters, please see the Company’s press releases, the Annual Financial Statements, Interim Financial Statements and associated MD&A all of which are available under the Company’s profile on SEDAR at www.sedar.com.

Appreciated is now up to date with its continuous disclosure obligations under National Instrument 51-102 - Continuous Disclosure Obligations. As a result, the Company has applied to the British Columbia Securities Commission (the "BCSC") for the revocation of the cease trade order issued against the Company by the BCSC on November 5, 2020 as a result of the Company’s failure to file the Company’s annual financial statements, MD&A and associated officer certificates for the year ended June 30, 2020, in accordance with the timelines set forth in National Instrument 51-102 - Continuous Disclosure Obligations.

About Appreciated

Appreciated is a worldwide film and television media production-packaging company whose core business is producing independent films and television movies for global business-to-business distribution. Appreciated is based in Vancouver, British Columbia.

Additional Information

For further information regarding Appreciated, please refer to the Annual Financial Statements, the Interim Financial Statements and the associated MD&A all of which are available under Appreciated’s SEDAR profile on SEDAR at www.sedar.com.

For more information, please contact:

Larry Howard, Director
Email: larry.howard@amcomri.com
Phone: +353-87-686-8255

Cautionary Note Regarding Forward-Looking Information

This press release contains statements which constitute “forward-looking statements” and “forward-looking information” within the meaning of applicable securities laws (collectively, “forward-looking statements”), including statements regarding the plans, intentions, beliefs and current expectations of Appreciated with respect to future business activities and operating performance. Forward-looking statements are often identified by the words “may”, “would”, “could”, “should”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” or similar expressions and includes information regarding the application for the revocation of the BCSC cease trade order.

Investors are cautioned that forward-looking statements are not based on historical facts but instead reflect Appreciated’s management’s expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although Appreciated believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed thereon, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the resulting issuer. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking statements are the following: the ability to obtain the revocation of the cease trade order in a timely fashion. These forward-looking statements may be affected by risks and uncertainties in the business of Appreciated and general market conditions, including COVID-19.

Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although Appreciated has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended and such changes could be material. Appreciated does not intend, and do not assume any obligation, to update the forward-looking statements except as otherwise required by applicable law.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.