UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

December 18, 2019

(Date of earliest event reported)

 

Cinedigm Corp.

(Exact name of registrant as specified in its charter)

 

Delaware 001-31810 22-3720962
(State or other jurisdiction
of incorporation) 		(Commission File Number) (IRS Employer
Identification No.)

 

45 West 36th Street, 7th Floor, New York, New York 10018
(Address of principal executive offices) (Zip Code)

 

212-206-8600

(Registrant’s telephone number, including area code)

 

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

  

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transmission period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class Trading Symbol(s) Name of each exchange on which registered
Class A Common Stock CIDM Nasdaq Global Market

 

 

 

 

 

Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

 

On December 18, 2019, Cinedigm Corp. (the "Company"), received a letter (the "Notice") from the Listing Qualifications staff of The NASDAQ Stock Market LLC ("Nasdaq") indicating that the Company no longer meets the requirement to maintain a minimum market value of publicly held shares ("MVPHS") of $15,000,000, as set forth in Nasdaq Listing Rule 5450(b)(3)(C). The Notice does not result in the immediate delisting of the Company's common stock from the Nasdaq Global Market.

 

In accordance with Nasdaq Listing Rule 5810(c)(3)(D), the Company has been provided a period of 180 calendar days, or until June 15, 2020, in which to regain compliance. In order to regain compliance with the MVPHS requirement, the Company's MVPHS must be at least $15,000,000 for a minimum of ten consecutive business days during this 180-day period. If the Company does not regain compliance with the bid price requirement by June 15, 2020, the Company may be eligible for an additional 180 calendar day compliance period. If the Company does not regain compliance by June 15, 2020, or the termination of any subsequent compliance period, if applicable, the Staff will provide written notification to the Company that its common stock may be delisted. At such time, the Company would be afforded the opportunity for a hearing before a Nasdaq Listing Qualifications Panel (the "Panel"). A request for a hearing would stay any suspension or delisting action pending the issuance of a decision by the Panel following the hearing and the expiration of any extension period granted by the Panel. In that regard, the Panel would have the authority to grant the Company up to an additional 180-day period in which to regain compliance.

 

The Company intends to monitor the MVPHS for its common stock between now and June 15, 2020 and will consider the various available options if its common stock does not trade at a level that is likely to regain compliance.

 

Item 8.01. Other Events.

 

On December 19, 2019, Cinedigm Corp. (the “Company”) issued a press release announcing a non-binding letter of intent to acquire an equity stake in Starrise Media Holdings Limited, a leading Chinese entertainment company.

 

Item 9.01 Financial Statements and Exhibits

 

EXHIBIT INDEX

 

Exhibit No.

 

Description

     
99.1   Press release dated December 19, 2019.

 

 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

    CINEDIGM CORP.
     
     
     
Dated: December 26, 2019   By: 

/s/ Gary S. Loffredo

      Gary S. Loffredo
Chief Operating Officer, President of Digital Cinema, General Counsel and Secretary

 

 

 

 

 

Exhibit 99.1

  

 

CINEDIGM AGREES TO PURCHASE 29% STAKE IN LEADING CHINESE ENTERTAINMENT COMPANY STARRISE MEDIA

 

LOS ANGELES, December 19, 2019 (GLOBE NEWSWIRE) -- Cinedigm Corp. (NASDAQ: CIDM) today announced the Company has signed a non-binding letter of intent to buy approximately 29% of the outstanding current common shares in leading Chinese entertainment company Starrise Media Holdings Limited (Starrise) (1616. HK) from existing holders. Cinedigm and Starrise have previously agreed to distribute Chinese entertainment content in North America and to release non-Chinese entertainment content in China theatrically and on digital platforms.

 

Cinedigm will purchase approximately 29% of Starrise’s current common shares from two major Starrise shareholders in exchange for shares of Cinedigm’s Class A common stock. This all-stock purchase will be based on the trailing volume weighted average prices of Cinedigm and Starrise common stock over a time period to be determined by the parties to the transaction.

This proposed transaction follows the significant investment in Cinedigm by Bison Capital, a China-based investment company with a focus on the media and entertainment, healthcare and financial service industries. Founded by Mr. Peixin Xu in 2014, Bison Capital has made multiple investments in film and TV production, film distribution and entertainment-related mobile Internet services. As a result of this proposed transaction, Bison Capital and related entities will increase their investment and ownership levels in Cinedigm.

 

“This proposed investment will be a major transformative transaction for Cinedigm,” said Chris McGurk, Cinedigm’s Chairman and CEO. “It is a key step in our plan to become the first true North America/China studio, uniquely well positioned over the long term to distribute premium film and TV content and launch high growth streaming channels in the two biggest and most important entertainment markets in the world. It will also enhance our efforts to rapidly build our fast-growing OTT business.”

 

“Bison Capital is very supportive of this proposed transaction,” said Peixin Xu, Chairman of Bison Capital. “We are very committed to supporting Cinedigm as the Company executes its compelling content distribution and OTT streaming strategies in North America and China. Our increased investment in Cinedigm as a result of this transaction fully underscores our support.”

 

Through this proposed transaction, Cinedigm will increase its presence and leverage in both the Chinese and North American entertainment markets. These are the two biggest Film and Television markets in the world, with combined Film/TV revenues estimated to be approximately US$180 billion in 2018.

 

 

 

 

Leveraging its unique OTT and independent content distribution capabilities, Cinedigm has been working closely with Bison to develop plans and forge partnerships to release entertainment content and develop OTT channels in China while, reciprocally, releasing Chinese content and new OTT channels in North America, such as the recently launched Chinese language content channel, Bambu.

 

Starrise is listed on the main board of the Stock Exchange of Hong Kong Limited. In calendar year 2018, Starrise reported approximately US$139 million in total revenues. (1.) Starrise’ Film/TV business segment mainly invests in film, television and other short form content. Starrise distributes film content theatrically and to all key media platforms in China and is committed to significantly growing its investment in entertainment content for the rapidly expanding Chinese theatrical and digital marketplaces. Recent prominent film investments by Starrise include The Wandering Earth, one of the most successful Chinese films ever released, generating almost US$700 million at the box office in China in 2019 and The Grandmaster of Kung Fu, a successful internet-released action movie.

 

The all-stock purchase is expected to close in the first quarter of calendar 2020, subject to the completion of a definitive purchase agreement and the receipt of the approval of Cinedigm’s stockholders and other applicable regulatory approvals.

 

ABOUT CINEDIGM

 

Since inception, Cinedigm (NASDAQ: CIDM) has been a leader at the forefront of the digital transformation of content distribution. Adjusting to the rapidly transforming business needs of today’s entertainment landscape, Cinedigm remains a change-centric player focused on providing content, channels and services to the world’s largest media, technology and retail companies. Cinedigm’s Content and Networks groups provide original and aggregated programming, channels and services that entertain consumers globally across hundreds of millions of devices. For more information, visit www.cinedigm.com.

 

Cinedigm™ and Cinedigm Digital Cinema Corp™ are trademarks of Cinedigm Corp. www.cinedigm.com. [CIDM-G]

 

Safe Harbor Statement

 

Investors and readers are cautioned that certain statements contained in this document are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act"). Forward-looking statements include statements that are predictive in nature, which depend upon or refer to future events or conditions, which include words such as "expects," "anticipates," "intends," "plans," "could," "might," "believes," "seeks," "estimates" or similar expressions. In addition, any statements concerning completion of the transactions described in this document, future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, and possible future actions, which may be provided by Cinedigm's management, are also forward-looking statements as defined by the Act. Forward-looking statements are based on current expectations and projections about future events and are subject to various risks, uncertainties and assumptions about Cinedigm, its technology, economic and market factors and the industries in which Cinedigm does business, among other things. These statements are not guarantees of future performance and Cinedigm undertakes no specific obligation or intention to update these statements after the date of this release.

 

 

 

 

Notes: (1.) Calculated at an exchange rate of 6.9 Chinese Yuan to 1 US dollar

 

Contact

 

Cinedigm
Jill Newhouse Calcaterra
310-466-5135
jcalcaterra@cinedigm.com