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DHX Media to cut debt load with money from Sony-Peanuts deal

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TOKYO - Snoopy may be joining Sony. Japanese electronics maker Sony Corp.'s music unit said Monday that it is buying a stake in Peanuts Holdings, the company behind Snoopy and Charlie Brown. Sony Music Entertainment signed a deal with Halifax-based DHX Media to acquire 49 per cent of the 80 per cent stake DHX holds in Peanuts.

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Sony Music Entertainment (Japan) has acquired a stake in the classic " Peanuts" brand, created by Charles M. Schulz, from DHX Media. The two companies announced a strategic partnership Monday that sees Sony indirectly purchase 49% of DHX Media's 80% stake in " Peanuts " for $185 million in cash. Following the deal, DHX Media will own 41% of the brand, Sony 39% and the Schulz family 20%.

Alongside the deal, Sony and DHX agreed to an extension of an existing licensing and syndication agency agreement between DHX and Sony's consumer products arm, Sony Creative Products in Japan, which has represented the brand since 2010, leading to 200% growth in the brand locally in that time. Sony Creative Products is currently working on a number of licensing programs to mark the 50th anniversary of the "Peanuts" brand's debut in Japan.

"We are honored to deepen our relationship with Sony Music Entertainment (Japan) as we continue our expansion of 'Peanuts' globally," said Michael Donovan, executive chair and CEO of DHX Media. "Sony Music Entertainment (Japan) has incredible expertise in rights management across the entertainment and consumer products industries. This transaction will allow DHX Media to de-lever our balance sheet as we team up with an ideal partner to help us reach our worldwide growth targets for 'Peanuts' in the coming years."

DHX will use the proceeds from the deal, after payment of transaction costs, to reduce debts. The deal is expected to close around the end of June this year, subject to regulatory approvals and other customary conditions.

DHX Media acquired the "Peanuts" brand as part of a $345 million acquisition of the entertainment division of Iconix Brand Group in May 2017.

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Sony Acquires Stake in DHX Media's 'Peanuts' for Global Partnership

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Sony Music Entertainment (Japan) has acquired a stake in the classic " Peanuts" brand, created by Charles M. Schulz, from DHX Media. The two companies announced a strategic partnership Monday that sees Sony indirectly purchase 49% of DHX Media's 80% stake in " Peanuts " for $185 million in cash.

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Snoopy may be joining Sony.

Japanese electronics maker Sony Corp.'s music unit said Monday that it is buying a stake in Peanuts Holdings, the company behind Snoopy and Charlie Brown.

Sony Music Entertainment signed a deal with DHX Media, based in Nova Scotia, Canada, to acquire 49 per cent of the 80 per cent stake DHX holds in Peanuts.

Under the deal, Sony Music will own 39 per cent and DHX 41 per cent. The family members of Charles Schulz, the creator of Peanuts, will continue to own 20 per cent of Peanuts. The parties hope to complete the acquisition on or about June 30, according to Tokyo-based Sony.

DHX Media Ltd. says the sale of nearly half of its stake in the Peanuts entertainment business to a Sony Corp. division for $237 million cash will help reduce the Canadian animation company's debt load and improve its operating results.

DHX also announced financial results that included a loss of $8 million in the three months ended March 31 and $116.5 million of revenue.

That compared with a year-earlier profit of $7.6 million and $78.3 million of revenue prior to the Peanuts acquisition.

DHX bought majority ownership of the Peanuts and Strawberry Shortcake brands last year under a US$345-million deal that significantly increased its revenue but also its debt load.

DHX Media executive chairman Michael Donovan said the transaction will reduce its debt load "as we team up with an ideal partner to help us reach our worldwide growth targets for Peanuts in the coming years."

Sony said it sees Peanuts as "world-class," and hopes to use its character business expertise to strengthen the brand and push the business to grow.

Sony has a range of characters under its wings, including those from its PlayStation video games. Its film division makes the Spider-man movie series.

Snoopy and other Peanuts characters are extremely popular in Japan, featured in a variety of everyday goods from T-shirts to plastic chopsticks.

The comic series was translated into Japanese decades ago, becoming an instant hit.

Peanuts began as a comic, first published in American newspapers in 1950. It's now carried in 2,200 newspapers around the world in 21 languages. In 2020, it will celebrate its 70th anniversary. Schultz, who used to say that all he wanted to do was to "draw funny pictures," died in 2000.

The popularity of Peanuts was stems partly from its ability to connect with a wide audience through its poetic portrayal of a children's world, exploring with sensitivity and humour themes such as failure, heartbreak and pursuit of music.

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Snoopy joining Sony? DHX Media to sell stake in Peanuts for $237 million to cut debt load

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Snoopy may be joining Sony. Japanese electronics maker Sony Corp.'s music unit said Monday that it is buying a stake in Peanuts Holdings, the company behind Snoopy and Charlie Brown. Sony Music Entertainment signed a deal with DHX Media, based in Nova Scotia, Canada, to acquire 49 per cent of the 80 per cent stake DHX holds in Peanuts.

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DHX Media Ltd. said Monday the sale of nearly half of its stake in the Peanuts entertainment business to a Sony Corp. division for $237 million in cash will help reduce the Canadian animation company's debt load and improve its operating results.

The Halifax-based company will retain 41 per cent of the Peanuts empire, which revolves around characters such as Snoopy, Charlie Brown and Lucy Van Pelt, while Sony Music Entertainment (Japan) Inc. will own 39 per cent. The family of creator Charles M. Schulz will continue to own 20 per cent.

Snoopy, right, throws out the ceremonial first pitch while Charlie Brown looks in a baseball game in New York in 2009. DHX Media Ltd. says the sale of nearly half of its stake in the Peanuts entertainment business to a Sony Corp. division for $237 million cash will help reduce the Canadian animation company's debt load and improve its operating results. (Henny Ray Abrams / THE ASSOCIATED PRESS)

DHX shares plunged Monday after the company also announced a quarterly loss and said it may not achieve its previously-announced guidance for fiscal 2018.

The stock closed down 87 cents, or 20.52 per cent, to $3.37 per share.

DHX executive chairman Michael Donovan said Monday that Sony is paying a 25 per cent premium over what DHX Media paid just last year and it will also help the Canadian company build the Peanuts brand in Asia.

Sony acquired rights to the Peanuts franchise in Japan in 2010. Its success in building Peanuts in Japan "provides a template for success in other markets, particularly other Asian markets, particularly China."

Snoopy and other Peanuts characters are extremely popular in Japan, featured in a variety of everyday goods from T-shirts to plastic chopsticks.

Peanuts began as a comic, first published in American newspapers in 1950. It's now carried in 2,200 newspapers around the world in 21 languages. In 2020, it will celebrate its 70th anniversary. Schultz, who used to say that all he wanted to do was to "draw funny pictures," died in 2000.

The comic series was translated into Japanese decades ago, becoming an instant hit.

Donovan said in an interview that "there's great knowledge and advantage to be gained from that partnership, not only in China, Japan and but throughout Asia."

The transaction will reduce its debt load "as we team up with an ideal partner to help us reach our worldwide growth targets for Peanuts in the coming years," Donovan said.

DHX bought majority ownership of the Peanuts and Strawberry Shortcake brands last year under a $345-million deal (U.S.) that significantly increased its revenue but also its debt load.

The Halifax company has been undergoing a strategic review of its options, including a potential sale of the company, as it struggles under the weight of its debt. Earlier this year, the company announced a management shake up, including replacing its chief executive officer and chief financial officer.

DHX, a leading children's content and brand company, known for Strawberry Shortcake as well as producing children's shows, had a loss of $8 million in the three months ended March 31 and $116.5 million of revenue.

That compared with a year-earlier profit of $7.6 million and $78.3 million of revenue in the comparable quarter last year, prior to its acquisition of majority ownership for the Peanuts and Strawberry Shortcake franchise in mid-2017.

DHX said Monday that it's in advanced negotiations on potential licensing deals but "in the absence of completing one of these opportunities, the company does not expect to achieve its previously disclosed guidance for fiscal 2018."

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DHX Media to cut debt load with money from Sony-Peanuts deal, CEO says | The Star

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DHX Media Ltd. said Monday the sale of nearly half of its stake in the Peanuts entertainment business to a Sony Corp. division for $237 million in cash will help reduce the Canadian animation company's debt load and improve its operating results.

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Two of the world's top entertainment and IP management companies forge global partnership to grow Snoopy, Charlie Brown and the Peanuts gang

Builds on Sony's eight-year relationship representing Peanuts in Japan with 200% growth

DHX Media to use proceeds to pay down debt and reduce leverage

Halifax, NS - 13 May 2018 - DHX Media (TSX: DHX.A, DHX.B; NASDAQ: DHXM) and Sony Music Entertainment (Japan) Inc. ("SMEJ") announce today that they have entered into a definitive agreement whereby SMEJ will indirectly purchase 49% of DHX Media's 80% interest in Peanuts for C$237 million (US$185 million) ¹ in cash, subject to customary working capital adjustments. Pro forma for the transaction, DHX Media will own 41% of Peanuts, SMEJ will own 39%, and the members of the family of Charles M. Schulz will continue to own 20%.

DHX Media and SMEJ have also agreed to extend the duration of the current Licensing and Syndication Agency agreement with SMEJ's consumer products division, Sony Creative Products Inc. ("SCP") in Japan. A leading intellectual property management company in Japan, SCP has represented Peanuts since 2010, and is currently spearheading multiple licensing programs celebrating the 50 th Anniversary of Peanuts' launch in Japan.

"We are honoured to deepen our relationship with Sony Music Entertainment (Japan) as we continue our expansion of Peanuts globally," said Michael Donovan, Executive Chair and CEO of DHX Media. "Sony Music Entertainment (Japan) has incredible expertise in rights management across the entertainment and consumer products industries, having successfully grown the Peanuts business in Japan over 200% since they became our agent in 2010. This transaction will allow DHX Media to de-lever our balance sheet as we team up with an ideal partner to help us reach our worldwide growth targets for Peanuts in the coming years."

DHX Media intends to use the net proceeds from the transaction after the payment of transaction costs to reduce its indebtedness under its term credit facility.

DHX Media and SMEJ aim to complete the transaction on or about June 30, 2018.subject to customary closing conditions, required regulatory approvals, applicable third party consents and the execution of certain ancillary agreements.

DHX Media was advised by Deutsche Bank Securities, Inc and Canaccord Genuity Corp.
¹USD to CAD exchange rate of 1.28 For more information, please contact:
Investor Relations: Nancy Chan-Palmateer - Director, Investor Relations, DHX Media Ltd.
nancy.chanpalmateer@dhxmedia.com
+1 416-977-7358

Financial Media: Shaun Smith - Director, Corporate Communications, DHX Media Ltd.
shaun.smith@dhxmedia.com
+1 416-977-7230

Trade Media: Aimee Norman at DDA Blueprint PR
aimee@ddablueprint.com
+44 (0) 20 8985 4708

About DHX Media
DHX Media Ltd. (TSX: DHX.A, DHX.B; NASDAQ: DHXM) is a leading children's content and brands company, recognized globally for such high-profile properties as Peanuts, Teletubbies, Strawberry Shortcake, Caillou, Inspector Gadget, and the acclaimed Degrassi franchise. One of the world's foremost producers of children's shows, DHX Media owns the world's largest independent library of children's content, at 13,000 half-hours. It licenses its content to broadcasters and streaming services worldwide and generates royalties through its global consumer products program. Through its subsidiary, WildBrain, DHX Media operates one of the largest networks of children's channels on YouTube. Headquartered in Canada, DHX Media has 20 offices worldwide. Visit us at www.dhxmedia.com.

About Sony Music Entertainment (Japan) Inc.
Sony Music Entertainment (Japan) Inc., or SMEJ holds all shares and serves as headquarters for the management and administration of all Sony Music Group subsidiaries, while continuing to grow as a diversified entertainment company. Operations include marketing and tie-ins, finding and developing artists, various entertainers and creators, as well as building our businesses abroad. SMEJstrives to continue finding new opportunities for the entertainment business by coordinating the various business resources throughout the Sony Music Group, in areas such as digital content where some of the latest technologies including VR and AI are applied, digital publishing, exhibition design, education, and sports entertainment. https://www.sme.co.jp/s/SMEen

About Sony Creative ProductsSony Creative Products Inc. (SCP) is an IP firm that provides a full range of merchandising and marketing services focused on the development and use of domestic and international intellectual properties such as copyrighted and trademarked material including illustrated characters. Operations include merchandising such as video, print publications, apparel, toys and other products, while uses in the services field include broadcasting, screening, events, amusement facilities, telecommunications, sales promotion, and distribution, which are handled either directly or under license. http://www.scp.co.jp/en/

Disclaimer
This press release contains "forward-looking statements" under applicable securities laws with respect to DHX Media including, without limitation, statements regarding the business strategies and operational activities of DHX Media and its subsidiaries, the completion of the prospective transactions and expected benefits flowing therefrom. Although DHX Media believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties and are based on information currently available to the DHX Media. Actual results or events may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations, among other things, include risk related to regulatory approvals and satisfaction of other conditions to closing the transactions, including applicable third party consents and the mutual agreement to the ancillary commercial agreements together with the operating agreement for the limited liability company through which DHX Media and SMEJ will hold their 80% interest in Peanuts ancillary commercial agreements, the ability of the parties to execute on the transactions, DHX Media's ability to effectively operate the business following closing, market factors, contract interpretation, application of accounting policies and principles and other factors discussed in materials filed with applicable securities regulatory authorities from time to time including matters discussed under "Risk Factors" in DHX Media's most recent Annual Information Form and annual Management Discussion and Analysis, which also form part of DHX Media's annual report on Form 40-F filed with the U.S. Securities and Exchange Commission. These forward-looking statements are made as of the date hereof, and DHX Media assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law.

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DHX MEDIA FORMS STRATEGIC PARTNERSHIP WITH SONY ON PEANUTS - DHX Media

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Two of the world's top entertainment and IP management companies forge global partnership to grow Snoopy, Charlie Brown and the Peanuts gang Builds on Sony's eight-year relationship representing Peanuts in Japan with 200% growth DHX Media to use proceeds to pay down debt and reduce leverage Halifax, NS - 13 May 2018 - DHX Media ...

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Charlie Brown, Snoopy, and their animated friends are about to have a new boss. Children's entertainment company DHX Media - whose properties include Teletubbies and Inspector Gadget - has agreed to pay $345 million for Iconix Brand Group, which owns 80% of Charles Schulz' as well as all of Strawberry Shortcake.

Schulz' family will continue to own 20% of the Peanuts franchise.

DHX expects the deal to close by the end of June, following approval by antitrust officials.

"Peanuts is one of the world's greatest entertainment brands, with a tremendous global legacy of comics, animated content and consumer products reaching back almost 70 years," DHX chief Dana Landry says.

Peanuts and Strawberry Shortcake "have widespread, evergreen appeal," he adds. That will strengthen DHX's "scale in consumer products" and "drive meaningful growth across multiple revenue streams" to reach "new generations of kids worldwide."

Charles Schulz' widow, Jean Schulz, called DHX "a perfect fit for Peanuts. We respect their innovative and rich history with developing children's shows and brands, and we look forward to working with Dana and his team to steward Peanuts in the future."

The deal will give the Canadian media company more than 340 half-hours of proprietary content that it can use to, as it says, "feed potential new production including new digital content for YouTube, mobile, and video-on-demand services." DHX has the WildBrain network on YouTube.

Sales of consumer products will account for 44% of DHX' annual revenues after the acquisition, up from 19%.

Meanwhile revenues could grow 52% to about C$443 million, with adjusted EBITDA up 40% to approximately C$134 million. The company expects to see about C$5 million in cost synergies per year in the first year, rising to $25 million within five years.

RBC Capital Markets and Jefferies Finance agreed to provide fully underwritten debt financing for the purchase price and will refinance almost all of DHX' current debt.

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'Peanuts' & 'Strawberry Shortcake' To Be Acquired By DHX Media For $345M

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Charlie Brown, Snoopy, and their animated friends are about to have a new boss. Children's entertainment company DHX Media -- whose properties include Teletubbies and Inspector Gadget -- has agreed to pay $345 million for Iconix Brand Group, which owns 80% of Charles Schulz' Peanuts as well as all o...

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Halifax-based DHX Media Ltd. is spending $345 million US to buy the rights to the characters of the Charles Schulz classic Peanuts and to the cartoon series Strawberry Shortcake.

The deal will see DHX buy the entertainment division of Iconix Brand Group Inc., which includes an 80 per cent controlling interest in Peanuts and a 100 per cent interest in Strawberry Shortcake, according to a company news release.

The remaining 20 per cent interest in Peanuts will continue to be held by family members of Schulz, who died in 2000.

DHX already owns numerous children's programs, including Teletubbies, Yo Gabba Gabba!, Caillou, Inspector Gadget and the Degrassi franchise.

The company owns and produces programming that is licensed to major broadcasters and video streaming services worldwide. It also generates royalties from merchandise based on its children's shows.

The company has offices in 19 cities and is headquartered in Halifax.

Cartoons have lasting appeal

In a news release, DHX CEO Dana Landry said Peanuts is one of the world's greatest entertainment brands and he was thrilled to welcome the Peanuts characters into the company's family of children's properties.

Peanuts follows the lives of Charlie Brown, his dog Snoopy and a large cast of other characters as they grow, explore and question the world around them.

Landry said both Peanuts and Strawberry Shortcake have widespread, everlasting appeal that make them ideal for streaming services. He expects both properties to drive up DHX's revenue.

The board of directors of DHX Media and Iconix have approved the sale but it still needs to be approved by regulators.

The deal is expected to close around June 30.

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Charlie Brown and Strawberry Shortcake sold for $345M US to Halifax company | CBC News

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The deal will see DHX Media Ltd. buy the entertainment division of Iconix Brand Group Inc., which includes an 80 per cent controlling interest in Peanuts and a 100 per cent interest in Strawberry Shortcake, according to a company news release.

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Charlie Brown acquired by Canadian firm for more than peanuts | The Star

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A mutual love of hockey helped seal the deal that will see the world's largest independent animation company, based in Halifax, add Charlie Brown and his Peanuts gang to its stable of brands, which already includes Teletubbies, Inspector Gadget and the Degrassi franchise.

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Accretive transaction accelerates DHX Media's growth in IP and consumer products; and provides resilient cash flow generation. Analyst & investor call at 8 a.m. ET.

Accretive transaction expands DHX Media's portfolio of children's IP.

Adds to DHX Media's strategic focus on top brands that leverage its platform in content production, distribution & consumer products.

Significantly accretive to cash EPS & free cash flow per share with substantial potential synergy upside.

Halifax, NS - May 10th, 2017 - DHX Media

DHX Media Ltd. (or the "Company") (TSX: DHX.A, DHX.B, NASDAQ: DHXM), has signed a definitive agreement to acquire the entertainment division of Iconix Brand Group Inc. ("Iconix"), which includes both an 80% controlling interest in Peanuts and 100% of Strawberry Shortcake. The remaining 20% interest in Peanuts will continue to be held by members of the family of Charles M. Schulz. The total purchase price for this acquisition is US$345 million, subject to a customary working capital adjustment, to be paid through a combination of cash on hand, new debt financing facility and a private placement offering of subscription receipts ultimately exchangeable for convertible debentures. The transaction is expected to close on or around June 30, 2017.

" Peanuts is one of the world's greatest entertainment brands, with a tremendous global legacy of comics, animated content and consumer products reaching back almost 70 years," said Dana Landry, CEO of DHX Media. "We are thrilled by the opportunity to welcome Charlie Brown, Snoopy, Lucy, Linus and the entire Peanuts gang into our family of leading kids' properties, including Teletubbies, Inspector Gadget, Caillou, Degrassi and others."

Jean Schulz, widow of Charles M. Schulz, commented: "DHX Media feels like a perfect fit for Peanuts. We respect their innovative and rich history with developing children's shows and brands, and we look forward to working with Dana and his team to steward Peanuts in the future."

"Over the past ten years, DHX Media has become a global leader in children's entertainment content, building scale across production, distribution and consumer products and is perfectly positioned to benefit from the incredible growth of streaming services, worldwide," Mr. Landry continued. " Peanuts and Strawberry Shortcake have widespread, evergreen appeal that make them ideal for layering onto this platform, complementing our 450-title library, and significantly increasing our scale in consumer products. These brands are expected to drive meaningful growth across multiple revenue streams, and we look forward to extending their reach to new generations of kids worldwide."
Strategic Benefits & Value Creation for DHX Media
Adds 340+ half-hours of proprietary content to DHX Media's library, which can feed potential new production including new digital content for YouTube, mobile, and video-on-demand services.
Financing Overview
Creates opportunities to mine an underexploited library for global distribution and expansion into new territories and channels, including our WildBrain network on YouTube.

Combines two highly complementary family entertainment brands to expand our global portfolio while increasing the scale and breadth of our consumer products business from 19% to 44% of total annual revenue, on a pro forma basis.

On a pro forma basis, DHX Media revenue would grow 52% to approximately C$443 million, and adjusted EBITDA would rise by 40% to approximately C$134 million⁽¹⁾⁽³⁾. The transaction would be 6-10% accretive to earnings per share and 25-30% accretive to free cash flow per share⁽²⁾, on a pro forma basis. Even on a leverage neutral basis, the acquisition would be accretive. The highly cash generative nature of the combined entity provides the ability to rapidly de-lever while still permitting investment in the company.

DHX Media also expects to realize annual cost synergies of C$5 million within the first year post-closing (which relates to 13% of the target trailing 12-month EBITDA), and C$25 million within the first five years.

Craig Schulz, son of Charles M. Schulz, added: "The Schulz family is thrilled to be partnering with DHX Media, as we have been greatly impressed by their professionalism and expertise. My father's comic strip and his entire body of work has delighted generations of fans for over 66 years, and we feel confident that DHX Media are the right people to help propel Peanuts into the future."

Financing at close includes a US$30 million revolver, a US$510 million committed term facility (4.1x to 4.4x⁽⁴⁾ leverage) and C$100 million senior unsecured convertible debentures (0.6x to 0.7x⁽⁴⁾ leverage). The company is targeting to reduce leverage to 3.0x⁽⁴⁾ by the end of Fiscal 2019. DHX Media has entered into a commitment agreement with RBC Capital Markets and Jefferies Finance, LLC to provide a fully underwritten debt financing covering the purchase price and also refinancing substantially all of the company's current indebtedness.
Redemption of 5.875% Senior Unsecured Notes due December 2, 2021
Concurrent with such bank financing, DHX Media has entered into an agreement with a syndicate of underwriters (collectively, the "Underwriters") to purchase, on a bought deal private placement basis, 100,000 subscription receipts of the Company (the "Subscription Receipts"), at a price of C$1,000 per Subscription Receipt, for aggregate gross proceeds of C$100 million (the "Offering"). The proceeds of the Subscription Receipts will be held in escrow and released to the company upon the completion of the acquisition. If the acquisition is not concluded within 120 days of issuance of the Subscription Receipts, then the Subscription Receipts will be cancelled and the funds held in escrow returned to the investors.

The Company has granted the Underwriters an option exercisable up to the day prior to closing of the Offering to purchase an additional 15,000 Subscription Receipts (the "Option Receipts") on the same terms and subject to the same conditions as the Subscription Receipts. If the Underwriters exercise their option to purchase the Option Receipts, aggregate gross proceeds of the Offering will be C$115 million.
(1) USD / CAD = 1.3285
(2) DHX Media free cash flow defined as cash flow from operating activities less capital and intangible asset expenditures, plus or minus changes in interim production financing.
(3) Based on the last 12 months to Dec. 31, 2016, and excluding synergies.
(4) Closing assumed to be June 30, 2017. Fiscal 2018 calculated using pro forma June 30, 2017, adjusted EBITDA expected to be US$105 million, and assumes a range of growth and first year synergies of US$10 to $20 million. Transaction Approval
Each Subscription Receipt will entitle the holder thereof to receive, upon satisfaction or waiver of all conditions precedent to closing of the acquisition pursuant to the definitive agreement (other than the final condition precedent of payment of the purchase price to the vendor), for no additional consideration and subject to adjustment, one special warrant (the "Special Warrants") that, upon the satisfaction of certain conditions, shall be automatically exercised, for no additional consideration, to acquire one 5.875% senior unsecured convertible debenture of the company (each, a "Convertible Debenture" and, collectively, the "Convertible Debentures"). Each Convertible Debenture shall be convertible into common shares of the company at a price of C$8.00 per common share, subject to adjustment in certain events.
Analyst and Investor Webcast and Conference Call
The Offering is scheduled to close on or around May 31, 2017, and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approvals of the Toronto Stock Exchange and the NASDAQ stock market. Upon request of the Underwriters, the company will use its reasonable commercial efforts to file a prospectus supplement or a prospectus in order to qualify the distribution of the Convertible Debentures issuable upon exercise of the Special Warrants in Canada. If so requested, the prospectus supplement or prospectus will be filed following the filing of a business acquisition report by the company in connection with the acquisition. The Special Warrants will automatically convert into Convertible Debentures upon the earlier of (i) the third business day following the filing of the prospectus supplement or the issuance of a receipt for the prospectus, and (ii) the date that is four months and one day from the date of the closing of private placement.

The securities to be issued under this Offering will be offered by way of private placement exemptions in all the provinces of Canada and elsewhere. All securities issued pursuant to this Offering will be subject to a statutory hold period of no more than four months from the date of distribution of the Subscription Receipts in accordance with Canadian securities legislation, subject to the prospectus qualification referred to above. The securities being offered have not been registered under the U.S. Securities Act of 1933, as amended, or applicable state securities laws, and may not be offered or sold within the United States absent registration or an applicable exemption from such registration requirements. This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there be any sale of any securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

As part of the refinancing related to the acquisition, DHX Media will redeem its 5.875% Senior Unsecured Notes due December 2, 2021 (the "Notes") on the terms as set out in the indenture governing the Notes. As of the date hereof, C$225 million aggregate principal amount of the Notes remains outstanding.
For more information, please contact:
The redemption of the Notes will be conditional on the closing of the acquisition and completion of the financings detailed herein.

The Boards of Directors of DHX Media and Iconix have approved the transaction, which is subject to approval under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions.

DHX Media management will hold a live webcast and presentation with slides for analysts and investors on May 10, 2017 at 8:00 a.m. ET, at the following address: http://edge.media-server.com/m/p/acr4iphd

To listen by phone, please call (844) 492-6042 toll-free, or (478) 219-0838 internationally and reference conference ID 20841478. The presentation for the call will also be posted to the Investor Relations section of our website, at: http://www.dhxmedia.com/investors/.

Please allow 10 minutes to be connected to the conference call. Instant replay will be available after the call on (855) 859-2056 toll free, or (404) 537-3406, under passcode 20841478, from May 10, 2017, 11 a.m. ET to May 17, 2017, 11 a.m. ET.

Investor Relations: Nancy Chan-Palmateer - Director, Investor Relations, DHX Media Ltd.
nancy.chanpalmateer@dhxmedia.com
+1 416-977-7358

Financial Media: Shaun Smith - Director, Corporate Communications, DHX Media Ltd.
shaun.smith@dhxmedia.com
+1 416-977-7230

Trade Media: Aimee Norman - DDA Blueprint PR
aimee@ddablueprint.com
+44 (0) 20 932 9800

About DHX Media
DHX Media Ltd. ( www.dhxmedia.com) is a leading children's content and brands company, recognized globally for such high-profile properties as Teletubbies, Yo Gabba Gabba!, Caillou, In the Night Garden, Inspector Gadget, and the multiple award-winning Degrassi franchise. Owner of the world's largest independent library of children's content, at more than 12,500 half-hours, the Company owns and produces shows that children love, licensing its content to major broadcasters and streaming services worldwide. The Company's robust consumer products program generates royalties from merchandise based on its much-loved children's brands. Through its subsidiary, WildBrain, DHX Media also operates a network of more than 360 children's channels on YouTube, one of the largest of its kind on the platform. Headquartered in Canada, DHX Media has offices in 19 cities globally, and is listed on the Toronto Stock Exchange (DHX.A and DHX.B) and the NASDAQ Global Select Market (DHXM).

- A Global Powerhouse BrandWhen Charles M. Schulz created the world of Charlie Brown, Snoopy, Lucy, Linus, Woodstock and the rest of the Peanuts friends, he gave birth to a phenomenon that has endured for almost 70 years, and is now widely recognized across generations and demographics. Generating retail sales of US$1.3 billion in 2015, the Peanuts brand has a strong, diversified global licensing program in approximately 100 territories with approximately 1,120 licensees, including Hallmark, Universal Studios, Warner Bros. and Cedar Fair. Animated Peanuts classics continue to be #1 ranked prime time TV specials and have been viewed in 196 countries, while 45 million comics are still read daily. In a recent E-Poll Market research report, Snoopy ranked as the #1 Most-Liked spokescharacter in America among adult consumers and #2 for children. Snoopy was also one of the top three characters of which adult consumers would like to see more. Sources: Licensing Letter, Iconix Brand Group.
DHX Media Fact Sheet Peanuts Brand Fact Sheet Download Infographics
Strawberry Shortcake - A Timeless Girls' Property
A global girls' property with multi-generational appeal, Strawberry Shortcake is truly a timeless brand. After more than 35 years since launch, it continues to resonate with young girls and their mothers who grew up with the beloved Strawberry Shortcake dolls. With a robust publishing program in 30 languages and 130 markets, 14 mobile apps and approximately 148 half-hours of content that have been viewed in 120 countries, Strawberry Shortcake holds tremendous potential in both the content and licensing markets. The property has generated US$4 billion in global sales since 2002 from currently 305 licensees. DHX Media is currently producing, in conjunction with Iconix, a new animated series based on Strawberry Shortcake to drive new global growth for this perennial brand. Sources: American Greetings, Iconix Brand Group.
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Use of Non-GAAP Financial Measures
The terms "EBITDA", "adjusted EBITDA" and free cash flow per share are non-GAAP measures that do not have any standardized meaning under GAAP and therefore may not be comparable to similar measures presented by other companies. These non-GAAP financial measures are provided to enhance the user's understanding of our historical and current financial performance and our prospects for the future. Management believes that these measures provide useful information in that they exclude amounts that are not indicative of our core operating results and ongoing operations and provide a more consistent basis for comparison between periods. Please see the "Use of Non-GAAP Financial Measures" and "Reconciliation of Historical Results to Adjusted EBITDA" sections of the Company's most recent Management Discussion and Analysis, available on EDGAR (www.sec.gov/edgar.shtml) and on SEDAR (www.sedar.com), for the definition and calculation of EBITDA and adjusted EBITDA and free cash flow per share.

Disclaimer
This press release contains "forward-looking statements" under applicable securities laws with respect to DHX Media including, without limitation, statements regarding the business strategies and operational activities of DHX Media and its subsidiaries, completion of the prospective acquisition, bank financing and private placement, the Company's ability to secure financing to complete acquisitions, the expected benefits of the acquisition, the estimated cost synergies that may be generated and the Company's future results of operations (including, without limitation, statements with respect to revenue, EBITDA and adjusted EBITDA) the redemption of the senior unsecured notes and regulatory approval. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties and are based on information currently available to the Company. Actual results or events may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations, among other things, include risk related to regulatory approval and satisfaction of other conditions to closing the acquisition, DHX Media's ability to complete the transaction, successfully integrate the acquired business and realize expected synergies, the ability to retain required employees and customer contracts, the accuracy of the assumptions upon which the expected synergies were estimated, market factors (including currency exchange and interest rate fluctuations), contract interpretation, application of accounting policies and principles, and other factors discussed in materials filed with applicable securities regulatory authorities from time to time including matters discussed under "Risk Factors" in the Company's most recent Annual Information Form and annual Management Discussion and Analysis, which also form part of the Company's annual report on Form 40-F filed with the SEC. These forward-looking statements are made as of the date hereof, and the Company assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law.

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DHX MEDIA TO ACQUIRE PEANUTS & STRAWBERRY SHORTCAKE - DHX Media

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Accretive transaction accelerates DHX Media's growth in IP and consumer products; and provides resilient cash flow generation. Analyst & investor call at 8 a.m. ET. Halifax, NS - May 10th, 2017 - DHX Media Accretive transaction expands DHX Media's portfolio of children's IP. Adds to DHX Media's strategic focus on top brands that leverage its ...