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WOW! Unlimited Media Announces Closing of Agreement and Option to Acquire Broadcasting Licence From Bell Media

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TORONTO AND VANCOUVER, British Columbia, Sept. 04, 2018 (GLOBE NEWSWIRE) -- Further to its press releases of June 7, 2017 and September 13, 2017, WOW! Unlimited Media Inc. (the "Company" or "WOW! ") (TSXV:WOW) and Bell Media Inc. ("Bell Media") are pleased to announce that they have executed an amended and restated asset purchase agreement (the "Agreement") in connection with the previously announced acquisition of a Category B specialty service (the "Broadcasting Licence") from Bell Media by WOW! Unlimited Networks Inc. ("WOW! Networks"), a wholly-owned subsidiary of WOW! (the "Transaction"). Pursuant to the updated terms of the Agreement, in exchange for the issuance of an aggregate of 3,433,446 common voting shares in the capital of WOW! (the "Consideration Shares") to Bell Media at a deemed price of $2.00 per Consideration Share for aggregate consideration of $6,866,892, WOW! Networks acquired an exclusive option (the "Option") to receive the Broadcasting Licence, for nominal consideration, at any time prior to December 31, 2018. If WOW! Networks does not exercise the Option before such date, it will be deemed to have exercised the Option as of December 31, 2018 and the Broadcasting License will be automatically conveyed to WOW! Networks on April 1, 2019, without any further actions from WOW! or WOW! Networks.

As announced on July 11, 2018, the Transaction was approved by the Canadian Radio-television and Telecommunications Commission (the "CRTC").

Upon the closing of the acquisition of the Option (the "Initial Closing"), WOW! and Bell Media have entered into a lock-up agreement (the "Lock-up Agreement") pursuant to which, among other things, Bell Media has agreed not to sell, transfer or assign the Consideration Shares for a period of up to twenty-four (24) months following the closing of the Transaction.

At the Initial Closing, WOW! and Bell Media have also entered into an investor rights agreement (the "Investor Rights Agreement") pursuant to which Bell Media has been granted: (i) the right to nominate one (1) individual to the board of directors of WOW! at each annual meeting of WOW!'s shareholders following the Initial Closing, such individual director nominee being Michael Cosentino; (ii) the right to appoint a representative to attend all meetings of the board of directors in a non-voting observer capacity following the Initial Closing, such representative observer nominee being Sarah Box; and (iii) subject to customary exceptions, a pre-emptive right to participate in any future offerings of WOW!'s common voting shares (the "Common Shares"), non-voting common shares or variable voting shares on a pro-rata basis following the Initial Closing.

The Transaction constitutes an arm's length reviewable transaction under the TSX Venture Exchange ("TSXV") Corporate Finance Manual Policy 5.3 – Acquisitions and Dispositions of Non-Cash Assets.

Bell Media has further agreed to provide certain services to effect the transition of the Broadcasting Licence. As partial consideration for such services, WOW! issued 900,000 non-transferable Common Share purchase warrants (the "Warrants"), each Warrant entitling Bell Media to acquire one (1) Common Share for a period of three (3) years from the date of issuance at an exercise price of $2.00. The Warrants are subject to vesting, such that a pro rata portion of the Warrants shall vest and become exercisable on the last day of each calendar quarter beginning on September 30, 2018.

Immediately prior to the issuance of the Consideration Shares and Warrants, Bell Media owned or controlled 188,823 Common Shares and $519,000 principal amount of 8% unsecured convertible debentures due December 14, 2020 (the "Convertible Debentures") of WOW!. The Convertible Debentures are convertible into a maximum of 259,500 Common Shares at a conversion price of $2.00 per Common Share, representing 1.11% of the outstanding Common Shares, and 0.78% of all the outstanding Common Shares and variable voting shares of WOW! (collectively, the "Shares"), on a non-diluted basis, and 2.60% of the outstanding Common Shares, and 1.84% of all the outstanding Shares on a partially diluted basis, assuming the conversion of the Convertible Debentures (but assuming no exercise, conversion or exchange of any other convertible or exchangeable securities of the Company by other holders).

Following the issuance of the Consideration Shares and Warrants, Bell Media owns or controls 3,622,269 Common Shares, $519,000 principal amount of Convertible Debentures and 900,000 Warrants, representing 17.76% of the outstanding Common Shares, and 13.12% of all the outstanding Shares, on a non-diluted basis, and 22.18% of the outstanding Common Shares, and 16.62% of all the outstanding Shares on a partially diluted basis, assuming the conversion of the Convertible Debentures and the full vesting and exercise of the Warrants (but assuming no exercise, conversion or exchange of any other convertible or exchangeable securities of the Company by other holders).

The Common Shares and Warrants were issued to Bell Media as consideration for the Option and services related to the Broadcasting Licence. Depending on various factors including, without limitation, conditions in the securities markets and general economic and industry conditions, Bell Media's business or financial condition, and other factors and conditions Bell Media deems appropriate, Bell Media may develop plans in the future to subscribe to, purchase, or sell securities of WOW!, to solicit proxies, or to otherwise participate in any significant transaction involving WOW! to maintain rights and privileges, such as board rights, associated with its current ownership position as provided in the Investor Rights Agreement. At the moment, Bell Media has not developed any such plans. 

Bell Media will be filing an early warning report under the SEDAR profile of WOW! at www.sedar.com. A copy may also be obtained by contacting Thane Fotopoulous, at 514-870-4619, or thane.fotopoulos@bell.ca.

About WOW! Unlimited Media Inc.

WOW Unlimited Media Inc. is creating a leading next-generation kids and youth animation business by focusing on digital platforms and content. The company's key assets include: the world's No. 1 digital animation network, Frederator Networks, which consists of an animation production company Frederator Studios, as well as video on demand channels on digital platforms, and one of Canada's largest, multifaceted animation production studios, Mainframe Studios.

About Bell Media

Bell Media is Canada's leading content creation company with premier assets in television, radio, out-of-home advertising, digital media, and more. Bell Media owns 30 local television stations led by CTV, Canada's highest-rated television network; 30 specialty channels, including TSN and RDS, and four pay TV services. Bell Media is Canada's largest radio broadcaster, with 215 music channels including 109 licensed radio stations in 58 markets across the country, all part of the iHeartRadio brand and streaming service. Bell Media owns Astral, an out-of-home advertising network of more than 30,000 faces in five provinces. Bell Media also operates more than 200 websites; video streaming services including CraveTV, TSN Direct, and RDS Direct; and multi-channel network Much Studios. The company produces live theatrical shows via its partnership with Iconic Entertainment Studios; owns a majority stake in Pinewood Toronto Studios; is a partner in Just for Laughs, the live comedy event and TV producer; and owns Dome Productions Inc., one of North America's leading production facilities providers. Bell Media is part of BCE Inc. ((TSX, NYSE:BCE), Canada's largest communications company. For more on Bell Media, please visit www.BellMedia.ca. The head office of Bell Media is located at 299 Queen Street West, Toronto, Ontario, M5V 2Z5.

Forward-looking Statements

This release contains forward-looking statements under applicable Canadian securities legislation that are not based on historical facts, including, without limitation, statements containing the words "believe", "may", "plan", "will", "estimate", "continue", "anticipate", "intend", "expect", "potential" and similar expressions. Forward-looking statements are necessarily based on estimates and assumptions made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as the factors we believe are appropriate. Forward-looking statements in this release include but are not limited to statements relating to the Transaction with Bell Media Inc.. Such statements reflect management of the Company's current views with respect to future events and are subject to risks and uncertainties and are necessarily based upon a number of estimates and assumptions that, while considered reasonable by WOW, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements. In making the forward-looking statements included in this release, the Company has made various material assumptions, including, but not limited to general business and economic conditions, the Company's ability to protect its intellectual property, the Company's ability to raise additional funding, existing governmental regulations and changes in, or the failure to comply with, CRTC and other governmental regulations and changes in business strategy or development plans. In evaluating forward-looking statements, current and prospective shareholders should specifically consider various factors set out under the heading "Risk Factors" in the Company's Annual Information Form dated April 27, 2018 and in the Company's management discussion and analysis dated May 29, 2018, copies of which are available on WOW's profile on the SEDAR website at www.sedar.com, and as otherwise disclosed from time to time on WOW's SEDAR profile.

Should one or more of these risks or uncertainties, or a risk that is not currently known to us, materialize, or should assumptions underlying those forward-looking statements prove incorrect, actual results may vary materially from those described herein. These forward-looking statements are made as of the date of this release and we do not intend, and do not assume any obligation, to update these forward-looking statements, except as required by applicable securities laws. Investors are cautioned that forward-looking statements are not guarantees of future performance and are inherently uncertain. Accordingly, investors are cautioned not to put undue reliance on forward-looking statements.

SOURCE WOW! Unlimited Media Inc.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For further information visit:

Website: www.wowunlimited.co
Contact: Neil Chakravarti, President &COO

Email: neil@wowunlimited.co

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