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Screaming Eagle (SCRM) Shareholders to Vote Upon Warrant Agreement Amendment

Screaming Eagle (SCRM) Shareholders to Vote Upon Warrant Agreement Amendment

Screaming Eagle (NASDAQ:SCRM) filed their S-4 registration statement this afternoon for its combination with Lionsgate Studios.  Included in the S-4 is a proposal for warrantholders where they will be asked to vote upon a proposal to amend the warrant agreement to provide that its whole public warrants, which have an exercise price of $11.50 per share, will be exchanged for $0.50.

Holders of 44.19% of the outstanding SEAC public warrants have already agreed to vote in favor of the amendment, but approval of the agreement requires 50%.

Pursuant to the terms of the sponsor support agreement, SEAC’s sponsor agreed to purchase no less than 5.81% of the outstanding public warrants.

If it fails to do so, then the sponsor will surrender and forfeit, and SEAC will cancel an amount of common shares delivered to the sponsor at the closing equivalent in value to the total amount of the aggregate then current market price for the warrants minus $0.50 multiplied by the number of warrants purchased.

Screaming Eagle recently announced its $4.6 billion combination with Lionsgate Studios in December. Lionsgate Studios will be made up of the TV studio and film production portions of its parent Lionsgate Entertainment (NYSE:LGF.A, LGF.B) as well as its existing content libraries.

The combination is conditioned on, among other things, the approval and adoption of the warrant amendment.