TORONTO, March 12 /CNW/ - Queen Street Entertainment Capital Inc. (TSXV:
QE) ("Queen Street") is pleased to announce that it has entered into a letter
of intent (the "Agreement") to acquire Morningstar Entertainment Inc.
("Morningstar"), a Toronto-based distributor of video and DVD titles.
Morningstar was established 15 years ago by Ron and Liz Mvring and has built a
unique reputation based on integrity and superior service to both content
creators and retail industry alike.
"This is a wonderful synergy in terms of people and business
integration", says Leif Bristow, Queen Street's Pres. and CEO, "everything
contained in QE's stated business objectives is based on the growth of library
and the exploitation of the library through all channels, DVD being the most
consistent and quickest recognized revenue stream from each title in the
library. Under Ron's continuing management we will expect to see a more rapid
growth of QE's revenues. Ron and Liz are receiving stock as part of their
consideration to reflect their continued commitment to the future growth of
the overall business, aligning their interests with those of all
"Morningstar Entertainment is extremely excited about this opportunity
with Queen Street Entertainment Capital" says Ron Mvring, Morningstar's Pres.
"As a leading independent Canadian publisher of DVD programming we are looking
forward to expanding our footprint and distribution activities worldwide with
not only our current library of titles but those productions and acquisitions
to which Queen Street affords us access".
Under the Agreement, Queen Street will acquire all of the issued and
outstanding shares of Morningstar, indirectly, from Ron and Liz Mvring, by
acquiring all of the issued and outstanding shares of their holding company,
Evergreen Ventures Ltd., and directly from Kaleidoscope Entertainment Inc.
("Kaleidoscope"), a company owned by Marshall Kesten and Randy Zalken, all
parties to the Agreement. The purchase price of $1.4 million is payable in the
form of cash and a series of notes payable on August 15, September 1 and
November 15, 2007, respectively, totaling $950,000 as well as the issuance to
Ron and Liz Mvring of 1,000,000 Queen Street common shares (at a deemed value
$0.45 per share). The purchase price is, in part, subject to adjustment based
on Morningstar's EBITDA for the one-year period ending August 31, 2007.
Kaleidoscope is a privately held Canadian television programme
production, distribution and consumer product licensing company. With this
transaction Kaleidoscope will be focusing on the growth potential in those
areas of its business.
No finder's fee was paid in connection with this transaction.
Queen Street trades on the TSX Venture Exchange under the ticker symbol
QE. There are currently 15,368,558 Queen Street common shares outstanding.
Additional information regarding the business of Queen Street may be found
filed on SEDAR at www.sedar.com.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release or the
information contained herein.
For further information:
For further information: Queen Street Entertainment Capital Inc., Leif
Bristow, President and Chief Executive Officer, (tel) (416) 691-6655 ext 222,
or Annette Grot, VP, Finance, (416) 691-6655 ext 231