UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
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| Item 1.01 | Entry into a Material Definitive Agreement. |
Purchase Agreement
As previously reported, on June 28, 2023, iMedia Brands, Inc. (the “Company”) and its U.S. subsidiaries filed a voluntary petition (Case No. 23-10852) (the “Chapter 11 Cases”) for relief under Chapter 11 of title 11 of the United States Code in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”).
On August 15, 2023, iMedia Brands, Inc. (the “Company”) and certain of its subsidiaries (together with the Company, collectively, the “Sellers”) entered into an Asset and Equity Purchase Agreement (the “Purchase Agreement”) with IV Media, LLC (“Buyer”), pursuant to which, subject to the terms and conditions in the Purchase Agreement, Buyer agreed to purchase substantially all of the Sellers’ assets for aggregate consideration consisting of (i) cash in an amount equal to $39,947,305.40, (ii) if there is a Minimum Cash Shortfall (as defined in the Purchase Agreement), cash in an amount equal to such Minimum Cash Shortfall and (iii) the assumption of the Assumed Liabilities (as defined in the Purchase Agreement), as further described in the Purchase Agreement (the “Sale Transaction”). The Purchase Agreement contained certain customary representations and warranties made by each party, which were qualified by confidential disclosures provided to the Buyer in connection with the Purchase Agreement. Sellers and the Buyer also agreed to customary covenants in the Purchase Agreement.
On August 15, 2023, the Bankruptcy Court entered an order (the “Sale Order”) (i) authorizing the sale of substantially all of the Company’s assets free and clear of certain encumbrances pursuant to the terms of the Purchase Agreement and the Sale Order, (ii) approving the Company’s entry into the Purchase Agreement, and (iii) authorizing the assumption and assignment of certain executory contracts and unexpired leases.
On August 16, 2023, the Sellers consummated the transactions contemplated by the Purchase Agreement. In connection with the consummation of the Sale Transaction, the senior secured super-priority debtor-in-possession credit facility, dated July 6, 2023, by and among the Company and Siena Lending Group LLC and the other parties thereto as lenders, was repaid in full, subject to the DIP Reserve Amount (as defined within the Purchase Agreement).
The Company intends to file a plan of liquidation with, and seek its confirmation by, the Court, which plan is expected to provide for the distribution of the net proceeds from the Sale Transaction and may contemplate the dissolution of the Company.
The foregoing description of the Purchase Agreement is qualified in its entirety by reference to the full text of the Purchase Agreement, a copy of which is attached hereto as Exhibit 2.1 and incorporated herein in its entirety by reference. The representations, warranties and covenants contained in the Purchase Agreement were made only for purposes of the Purchase Agreement and as of specific dates, were solely for the benefit of the parties to the Purchase Agreement, and may be subject to limitations agreed upon by the contracting parties.
| Item 2.01 | Completion of Acquisition or Disposition of Assets. |
The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
Forward-Looking Statements
This document may contain certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements contained herein that are not statements of historical fact, including statements regarding anticipated timing of filings with the Securities and Exchange Commission are forward-looking. The Company often use words such as anticipates, believes, estimates, expects, intends, seeks, predicts, hopes, should, plans, will, or the negative of these terms and similar expressions to identify forward-looking statements, although not all forward looking-statements contain these words. These statements are based on management's current expectations and accordingly are subject to uncertainty and changes in circumstances. Actual results may vary materially from the expectations contained herein due to various important factors, including (but not limited to), the Company’s ability to resolve the foregoing matters involving its liquidity and indebtedness. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this announcement. The Company is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
| Exhibit No. |
Description | |
| 2.1 | Asset and Equity Purchase Agreement, dated as of August 15, 2023, by and between the Company, the Company’s subsidiaries party thereto, and IV Media, LLC | |
| 104 | Cover Page Interactive Data File, formatted in Inline XBRL |
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 hereunto duly authorized.
| Date: August 21, 2023 | iMedia Brands, Inc. | |
| By: | /s/ James Alt | |
| James Alt | ||
| Chief Transformation Officer | ||