Sycamore Entertainment Group Inc (SEGI)

[RyGuy]

SEGI - Sycamore Entertainment was formerly Imarex Therapeutics. Imarex Therapeutics used ticker symbol IMRX and IPO'd at $5 and wes listed on the NASDAQ. IMRX was shorted essentially from inception of it's IPO, and never saw $5 again.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=22243058

The stock had an estimated 11.6 Million shares in the O/S and an estimated 7 - 9 million shares short, at the time of the merger.

I continued buying shares in November, December, and January of 2010 as someone continued selling to me. Here Superfly noted the activity occurring.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57168636

Now, I admit after the whole Monk fiasco, I was not a big fan of the whole Float Lock Down play. I was however intrigued when I was able to accumulate so many shares of the float just by myself, However, this has never been the reason I have accumulated so many shares. I will share the real reason at the bottom. This definitely has been a patience trying and pain stakingly slow wait to get positive direction from the company, but so far the CEO has not resorted to selling all kinds of stock to get things accomplished.

Here I commented about the Share Structure in late 2010

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57422803

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57430266

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57430668

Here on December 6th, I first revealed my 7 Million share position.

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57435361

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=57624994

Here I updated my position to the board on August 29th, 2011. I have been buying all year long when people would try selling below my cost average, so in turn I would lower my average at the same time. Many here accused me of dumping my holdings every time the stock would take a bit of a dive, so I have continually showed my position

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=66642267

Here is my most recent updated holdings of 12,750,000 shares, so you can see I have not been dumping like 1 person in particular has claimed all year long that I have been doing:

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=68748986&txt2find=holdings

Merger agreement was filed on March 2010: http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=7142334

http://www.otcmarkets.com/stock/SEGI/company-info

The TA is RTCO. It is the same TA that was inherited from the merger with the NASDAQ shell.

http://www.rtco.com/

SEGI updated Company Share Structure as of August 26th, 2011


Float = 15,798,000 shares
O/S = 156,607,608 shares

Current Market Cap: $3,053,848

Sycamore Entertainment's website is: http://www.sycamoreentertainment.com/

Sycamore's principles are Ed Sylvan, Mike Doban, Joe Takats, and Terry Sylvan: http://www.sycamoreentertainment.com/management-team.php

Mike Doban was a former executive at United Artists Theaters, one of 3 founders of Freestyle Releasing, and a well known consultant to the theater industry.

Here is an Interview of Ed Sylvan and Louis Gosset Jr. on Fox Business regarding African Americans in film: http://www.sycamoreentertainment.com/news-20110221.php

A recently released article with Ed Sylvan regarding the funds he has successfully raised so far, and they are currently in negotiation for 2 mid major films for distribution and have secured 1: http://www.fa-mag.com/component/content/article/7395.html?issue=169&magazineID=3&Itemid=211

Ed Sylvan's SEGI CEO's Twitter postings:

http://twitter.com/#!/sycamorefilms


The real reason i have accumulated so much stock, is the potential for return with successful movies. We finally have our first movie announced and it is "Isle of Dogs"

Here is the star Andrew Howard of our film "Isle of Dogs" in a clip of his role in the film "limitless" with Bradley Cooper.

http://www.youtube.com/watch?v=AuqvuKZ0BQ0

Now I do not know for a 100% fact that there is a significant short here, but there does appear to be one since the float was purchased in November 2010 according to company numbers. However, if their is not, I have based based my large investment on a few factors that do not include the potential short position as my investment strategy in any way. I view a potential short being stuck as a bonus if there is one here.

As an investor in SEGI it doesn't really matter what the film investors make, it matters what the distributors take is. Film Producers have the largest risk of losing on a film, than Distributors as distributors are last money in the investment and first money out outside of the theater chains.

Every distribution deal is in effect a business of its own. But you can use base percentages and get a decent estimation of what a company like SEGI could earn from distribution. They also will make more money from managing the P&A fund. I am also using low end numbers in these estimations cause most full service distributors actually make at least 30% but my number is based on a low end service deal of 15%.

Now every deal is different, but P&A (Print & Advertising) funding gets paid back first after the theatrical 50/50 split. Then distributors make anywhere from 15% to 40% of gross revenues.

So just as an example. Using the film as an example "Insidious", pretending that Sycamore acquired the distribution of that film. Again this is just pretending that Sycamore Entertainment released "Insidious"

SEGI would have successfully released the film domestically to the tune of $54 Million. Also lets assume a $10 Million P&A fund was used for the film which is probably a bit high. Cause Film prints and delivery cost on average approximately $1000 for each theater location, and then associated advertising for a few weeks prior. I'm assuming P&A was probably around $5 to $7.5 Million. But $10 Million should be a safe barometer.

http://www.boxofficemojo.com/movies/?id=insidious.htm

We subtract the $10 Million P/A and we'll say a $2.5 Million fee to pay the fund investors for a total of $12.5 Million.

We now have a total of $14.5 Million gross from which distributors are allowed to take any incurred expenses as well as their agreed upon distribution fee which can be anywhere from 15% to 40% but we will use 15% on the low end which is essentially the equivalence of a "service deal".

So say there were $2 Million in expenses negotiated in management fees with the films distribution such as distribution management, marketing plans, and marketing consultants that Sycamore could take off the top to pay off those expenses leaving $12.5 Million. Then there is the 15% SEGI could potentially bring in as their distribution fee which could net them $1,875,000 from the remaining $12,500,000 in this instance plus say a P&A managment fee of $500K, thus leaving the producers that made "Insidious" with $10,625,000 to cover their production budget of $1.5 Million and making the producers a $9,125,000 Million profit.

Take into account the monies made by SEGI in Distribution Fees of $2,000,000 and their 15% take of 1,875,000 and their P&A management of $500,000 then there is potential for $4,375,000.

If just $1,000,000 of this is profit (low end) and they can replicate this business across 5-8 films a year then a significant return could be foreseen. Use 5 films and $5 Million in profit annually from those films spread across an O/S of 157 Million give and EPS of $.03

Use a low end P/E ratio of 10 and you have a $.30 stock. Use a 20 P/E and you have a $.60 stock.

Get a couple of blockbuster movies and Sycamore becomes the next Lionsgate or Summit on the distribution depth chart and your looking a moon shot of the share price.

Keep in mind, that I did not mention anything about the monies received from Home and Video distribution. A DVD costs distributors on Average about $1 to copy. If walmart sells a DVD for $15 the price paid to SEGI would probably be around $7.50. Minus $1 production run costs there is $6.50 left to split between film producers and SEGI the distributor. SEGI would get approximately 40% of that cut as distributor or $2.60 per DVD.

1 Million DVD's sold would net them $2.6 Million based on that calculation.

Imagine doing this all 5 to 8 times a year for every film acquired. Sure some will be flops but what if 1 becomes a blockbuster.

Summit Entertainment was nothing before the "Twilight" series. Lionsgate was nothing until the "Saw" franchise of films was born.

No Sycamore has also just relocated their offices to Paramount Studios Lot. Could be big.

Here is the opening credit sequence to Isle of Dogs. This is all I have been able to find so far.

http://www.youtube.com/watch?v=nUFoeiq19IM