CONFIDENTIAL REPORT

To: Board of Directors, GoAnimate Studios
CC: Shareholders, Legal Advisors
From: Alistair McFadden, Chief Integration Officer
Date: December 14, 2023
Subject: Consultation on Dissolution of Chooks123 Productions

Executive Summary:

Chooks123 Productions, a once-thriving animation house based in Greenock, Scotland, ceased active production in April 2020 following its acquisition by GoAnimate Studios. Over the past three years, we have successfully integrated valuable assets and talents into GoAnimate’s workflow and projects. This report examines the implications, benefits, and considerations related to the proposed dissolution of Chooks123 Productions.

Background:

Founded in 2015, Chooks123 Productions quickly made a name for itself with its unique storytelling approach and innovative animation techniques. In January 2020, GoAnimate Studios acquired Chooks123 with the intention of expanding its animation portfolio and leveraging Chooks123’s assets to bolster GoAnimate’s presence in European markets.

As of April 2020, production at Chooks123 was suspended, and the focus shifted towards integrating their resources into the GoAnimate ecosystem. This process included the transfer of IP rights, assimilation of Chooks123’s animation talent into our team, and the merging of technological infrastructure.

Current Status:

The integration period is now complete. The Chooks123 brand has been fully absorbed, and former employees are now embedded within the GoAnimate Studios framework, contributing significantly to various successful projects. With the full transfer of intellectual property and proprietary technology, Chooks123 Productions no longer operates as a distinct entity. Furthermore, the lease for the Chooks123 facility in Greenock has expired, with no intention of renewal.

Financial Implications:

Considering the dormant state of Chooks123 Productions, maintaining the legal entity represents an unnecessary financial overhead. Costs associated with accounting, legal compliance, and other statutory requirements are indefensible when weighed against the lack of active production or revenue generation.

Legal Considerations:

Prior to initiating the dissolution process, a thorough legal review is required to ensure all contractual obligations have been met, and there are no outstanding liabilities. It is essential that the dissolution adheres to the laws and regulations governing corporate dissolution in Scotland and the UK.

Proposal:

We propose to officially dissolve Chooks123 Productions. The practical steps would involve:

1. Distributing a formal proposal for dissolution to all stakeholders.
2. Securing the approval from shareholders and the Board of Directors.
3. Publicly announcing the intended dissolution to ensure transparency and compliance with legal requirements.
4. Settling all outstanding financial obligations.
5. Filing necessary documentation with the Companies House and other regulatory bodies.
6. Archiving all necessary records and data for the legally required period.

Recommendation:

We recommend proceeding with the dissolution of Chooks123 Productions. Given the successful asset integration, there is no foreseeable advantage in maintaining the entity in a non-operational state. A detailed plan of action and timeline for the dissolution process should be established, minimizing disruptions and ensuring a seamless transition.

Projected Outcomes:

Dissolution of Chooks123 Productions is expected to result in a more streamlined corporate structure, reduced administrative costs, and a consolidation of branding under GoAnimate Studios. This action will also allow us to allocate resources more efficiently and focus on our next phase of growth and expansion.

Conclusion:

The proposed dissolution of Chooks123 Productions is a logical and prudent step in the consolidation process post-acquisition. It is a necessary measure to optimize operational efficiency and financial health for GoAnimate Studios.

It is recommended that the Board reviews this report and provides guidance on initiating the dissolution process. A follow-up meeting can be scheduled to discuss the details and address any questions from the Board.

Respectfully submitted,

Alistair McFadden
Chief Integration Officer, GoAnimate Studios
Write a follow up where the playpark (owned by Chooks123) was demolished, and a mini Odeon (a multi purpose one, which can be used for gaming and live sport, also serves alcoholic beverages) was put in it’s place, this happened in 2022, Also, the Chooks123 Studios Network childrens television channel was a joint venture between the company and CSC Media Group, The brand is still in use on the channel, but it is being sold fully, and will be rebranded as Pop on New Years Day.
CONFIDENTIAL REPORT

To: Board of Directors, GoAnimate Studios
CC: Shareholders, Legal Advisors, CSC Media Group
From: Alistair McFadden, Chief Integration Officer
Date: December 16, 2023
Subject: Update on Asset Repurposing and Chooks123 Studios Network Development

Executive Summary:

Following the previous communique concerning the proposal to dissolve Chooks123 Productions, this report provides a crucial update on the repurposing of the company’s physical assets and the development of the Chooks123 Studios Network. In particular, we will address the demolition of the Chooks123 playpark and its replacement with a state-of-the-art mini Odeon in 2022, as well as the impending sale and rebranding of the Chooks123 Studios Network television channel.

Asset Repurposing - Mini Odeon Development:

In 2022, the property which previously held the Chooks123 playpark was redeveloped. The playpark, deemed obsolete following the shift in our business strategy, was sold off and replaced with a modern mini Odeon cinema. This multi-use cinema not only shows the latest movies, but also accommodates gaming events, live sports screenings, and also features an in-house bar serving alcoholic beverages. The mini Odeon concept aligns closely with GoAnimate Studios’ endeavor to diversify entertainment offerings and enhance our engagement with a broader audience demographic.

Financial reports indicate that the mini Odeon has been performing exceedingly well since its opening. Its contemporary business model caters seamlessly to current market trends and consumer expectations. 

Chooks123 Studios Network:

The Chooks123 Studios Network, launched as a joint venture between Chooks123 Productions and CSC Media Group, has effectively entertained and engaged children with its unique programming mix. While the network still utilizes the Chooks123 brand, we are in the final stages of negotiations for its full sale to CSC Media Group.

As per the agreement, the channel will undergo a rebranding process and is set to officially relaunch as Pop on New Year’s Day. “Pop” is a pre-existing brand under CSC Media Group which resonates well with the children’s entertainment market. The timing of this rebranding strategy is designed to capitalize on the holiday period, a peak season for television viewership among our target audience.

We have ensured that all staff members currently employed by the Chooks123 Studios Network have been offered positions under the new management or have received support for alternative opportunities within GoAnimate Studios or the wider industry.

Strategic Benefits:

1. The repurposing of the playpark into a mini Odeon allows us to better align our real estate assets with current business directives and market demands.
2. The sale and rebranding of the Chooks123 Studios Network to Pop will help refocus our brand strategy, enabling us to invest in content and distribution platforms more directly aligned with GoAnimate Studios’ core mission.
3. These developments further solidify GoAnimate Studios’ market position and prepare us for a future of growing engagement in diverse entertainment sectors.

Recommendation and Conclusion:

The Board of Directors is advised to endorse the asset repurposing initiatives and ensure a smooth transition for the Chooks123 Studios Network’s rebranding. We also recommend approval and support of the final sale agreement with CSC Media Group.

The proposed actions reflect a strong commitment to streamlining our operations while maximizing the utility of our assets. The Board is invited to discuss the details provided in this report and to give their consent to move forward.

Respectfully submitted,

Alistair McFadden
Chief Integration Officer, GoAnimate Studios
Write a follow up where dissolution begins on January 5th 2024
CONFIDENTIAL REPORT

To: Board of Directors, GoAnimate Studios
CC: Shareholders, Legal Advisors
From: Alistair McFadden, Chief Integration Officer
Date: January 6, 2024
Subject: Commencement of Chooks123 Productions Dissolution Proceedings

Executive Summary:

As directed by the decision of the Board of Directors and in line with the strategic initiatives previously communicated, the formal dissolution process of Chooks123 Productions commenced on January 5th, 2024. This action follows the successful integration of Chooks123 Productions’ assets into GoAnimate Studios and the recent development involving the Chooks123 Studios Network. Herein, we provide an update on the dissolution proceedings and outline the immediate steps taken as part of this process.

Dissolution Proceedings:

As per the outlined plan, and following the announcement to all stakeholders, the dissolution of Chooks123 Productions has formally begun in accordance with the relevant legal and regulatory frameworks set forth in Scotland and the United Kingdom.

Key actions taken on January 5th include:

1. Filing of Notice of Dissolution with Companies House, indicating the intention to dissolve Chooks123 Productions.
2. Public announcement of the commencement of the dissolution process, enabling any creditors or claimants to present their cases in a timely manner.
3. Review and settlement of any remaining contractual obligations or financial liabilities of Chooks123 Productions by our legal and financial teams.
4. Dispatching of communications to all employees, suppliers, and partners associated with Chooks123 Productions, providing them with information regarding the dissolution and their respective situations or transitions.

Next Steps:

The dissolution process is expected to continue over the next few months, during which time the following actions will be taken:

1. Collection and liquidation of any outstanding assets belonging to Chooks123 Productions.
2. Distribution of remaining assets to shareholders, if applicable and after settling all liabilities.
3. Finalizing employee transitions to either GoAnimate Studios or assisting with external job placements.
4. Preservation of important records and archives as required by law for potential future reference.
5. Cancellation of any remaining business licenses, permits, and insurance policies.
6. Conducting a final review to ensure all aspects of the business have been adequately closed out.

Throughout this process, we will maintain regular communication with all necessary parties to ensure a transparent and orderly dissolution of Chooks123 Productions.

Recommendations and Conclusion:

We recommend that the Board continues to oversee the dissolution process through regular updates from the appointed liquidation committee. Moreover, we suggest appointing an external audit to review the final stages of the dissolution to ensure thorough compliance with legal and financial standards.

The dissolution of Chooks123 Productions marks the end of an era; however, it allows GoAnimate Studios to move forward with a more unified and efficient organizational structure. We are committed to handling this transition with the utmost professionalism and care for all involved parties.

The Board will be apprised of ongoing developments and is encouraged to reach out for further information or clarification as needed.

Respectfully submitted,

Alistair McFadden
Chief Integration Officer, GoAnimate Studios. Write a summary detailing all the stages, beginning with the company running a "skeleton staff" for a year in the facility after production ceased, this was to accommodate the absorption of the international programming sales division, This was also to continue management of the channel, The skeleton staff left in late July 2021 and the facility became dormant, The channel was relocated to CSC's office, The playpark was sold to Odeon Cinemas Limited in January and demolished in June, with the Odeon beginning work in October